I just finished reading Robin Hahnel’s recently published book ‘Democratic Economic Planning’ and have some open questions to clarify regarding Hahnel’s ideas in the subchapter on “International Financial Investment” (pp. 277-278), as I think there are some problematic contradictions there (but maybe I just lack understanding).
Shortly before, Hahnel writes about ‘international direct investments’ that these are completely prohibited for a Participatory Economy, as they would run counter to the fundamental principles and values - especially workers’ self-management - of Parecon. Here is a longer excerpt:
“Should a country with a participatory economy engage in international trade (IT)? Should a country with a participatory economy engage in international financial investment (IFI)? Should a country with a participatory economy make direct foreign investments abroad (DFI) or permit DFI by foreigners in its economy? And, if a country with a participatory economy should enter into any of these international economic relationships, how should it go about doing so? […] However, we begin by explaining why a country with a participatory economy should not engage in DFI of any kind.
A country with a participatory economy will not have to decide whether any of its worker councils should make direct foreign investments abroad, or whether foreign businesses should be permitted to make direct foreign investments in its participatory economy because DFI is incompatible with a fundamental principle of participatory economics — worker self-management. […] And while worker councils and federations in a participatory economy may encourage and even help establish worker owned cooperatives in other countries, the principle of economic self-management also does not allow a worker council in a participatory economy to own and operate for profit a business abroad, because that would make foreign workers into employees rather than full members of a worker council with all the rights that entails.” (p. 268-269)
The same basic message with regard to (national) financial investment can be found in the FAQs (» Is there a stock market?)
(» Can I use my personal savings to make investments?)
So how should it then be legitimate to make financial investments on an international level and how would these concretely look like, so that the principles of Parecon are preserved? Doesn’t one then also let workers abroad work for oneself (now as a nation) to a certain extent and skim off the “rates of return on investment” and “interest rates on international loans” (p. 277), the created surplus value? And where can the central principle of ‘reward for effort’ be found in all this, if I (as a nation) let my capital ‘work’ for me abroad?
I hope these are not too many questions at once…