Workplace-Consumption-Rights and Consumption over your estimated Proposal

Questions
1

Hello everyone,
I wanted to clarify some aspects concerning consumption rights and the handling of overconsumption (consumed more than planned) for myself, so here are some thoughts and questions.

1. The first question is how a workers’/worker-councils’ income is specifically determined over the course of a year.

As I understand it, there are two different ways by which my workplace/workers’ council (WC) will get credited a certain amount of consumption-rights, which it then can distribute (on its own terms) among its members: One would be to compensate the workplace according to its SB/SC-Ratio in relation to the average SB/SC in the sector (which means that higher effort would be rewarded), all of which is determined at the end of the year. The other method would be to just give every council the same average compensation per person.
Now assuming the first case: Am I correct, that the whole amount of distribution rights your workplace gets credited is set at the end of one year for the whole respective following year? Example: The average SB/SC compensation in my sector is 10.000 (PE-currency) per person. In the end of year 1 the result of my WC with 10 members is a SB/SC-Ratio of 20% above average. This means that my workplace gets 120.000 (PE-currency) to distribute among its member in the following year 2.
So far correct? Is it just about the (last) end-year results determining the following years distribution? There is no (inter-year running) monthly assessment and adaptation of the workplace compensation? What if a workplace hires a new worker, would this in the above example mean that the WC now would have 132.000 (PE) to distribute among its members, or if the new workmate joins in the middle of the year (if even possible) accordingly 126.000 (PE)?

2. Now the (widely different) second question: What if I overstretch my consumption in relation to my planning-assessment in the annual planning procedure during the year?

Both Hahnel and Anders address this question (Hahnel, Democratic Economic Planning, p. 125-126 and Anders, Anarchist Accounting, p. 42).

Both propose that if a certain degree of deviation is reached, you’ll get informed that you maybe should revise your proposal. But assuming you won’t do that and (maybe also for other reasons) at the end of the year you’ll have overconsumed in relation to your personal plan (since you are free to do so). Is there some kind of penalty-fee-mechanism which encourages the consumers to try to stick to the plan as best as possible, or otherwise to revise the plan as exactly as possible during the year?

Here a quote from ‘Democratic Economic Planning’:
“If one’s rate of consumption for an item deviates by say 20% from the rate implied by the annual request, consumers could be “prompted” and asked if they want to make a change. In any case, if at the end of the year the total social cost of someone’s actual consumption differs from the social cost of what they had asked and been approved for, they would simply be credited or debited appropriately in their savings account.” (p. 126)

One thing that irritates me here is the formulation that at the end of the year you get ‘credited or debited’. Why at the end of the year? As far as I understood it your account gets debited as soon as you buy something during the year? Is this as obvious as it seems and just means that - bottom line, as the sum of all these individual payments - you would have to pay proportionally more in comparison to your (not complied with) plan-proposal? If that is the case, where is the incentive to revise your proposal except for the (at some point probably somewhat annoying) mails urging you to do so?

Regards,
A.

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2

Robin and Anders are the most qualified to respond to this post since you’re asking questions in response to their books. However, I’m going to take a shot at the second question.

Notice that Robin’s book is talking about debiting AND crediting. While it’s true that debts could be immediately applied during the year, you can’t credit someone’s account for products they didn’t consume until the year is complete. Imagine trying to credit someone for products they didn’t consume during month 11 of the plan; that doesn’t make sense since people still have an entire month to acquire more products. I imagine the phrase “end of the year” is being used as a “catch all” for both cases.

When you talk about revising a consumption plan, I’m not totally sure what you mean because the consumption plans aren’t revised during the year. I think the hope is that people will revise their consumption BEHAVIOR based on the message, but there’s no guarantee they’ll do that. If you’re talking about revising next year’s consumption plan based on last year’s debts, I would say it’s the software’s responsibility to make sure consumers can’t ask for more than they have the right to ask for. However, there’s different ways for dealing with this.

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Hello Michael,
thanks for your response. I will go straight to the last point of your answer, since this is at the core of my (second) question. Here some quotes from Robin and Anders concerning individual plan-adjustments, which let me to my conclusions:

“Some consumers will be more accurate than others in preparing their consumption proposals, and other consumers will need to adjust their proposals more during the year when their actual consumption deviates from their planned consumption. When a deviation exceeds a certain predetermined level, a consumer may be urged to update her consumption proposal. Some adjustments will cancel each other out at the total level in the consumer federations so that no, or only marginal, changes of production plans need to be made during a year.” (Sandström, Anarchist Accounting, p. 42).

“Neighborhood consumption councils and consumer federations make consumption desires known for both private and public goods during the participatory planning process by entering proposals on behalf of their members. However, neighborhood proposals for private consumption are really just neighborhood-wide best guesses. In other words, nobody is going to hold households to their consumption requests when it turns out they want to consume more of some things and less of others than they pre-ordered. […] We are well aware that consumers will misestimate what they ask for and need to make changes during the year, and that some consumers will prove more reliable and others more fickle. The easiest way to think about this is to imagine each consumer with a debit swipe card that records what they consume during the year as they pick it up and compares their rate of consumption for items against the amount they had asked and been approved for. If one’s rate of consumption for an item deviates by say 20% from the rate implied by the annual request, consumers could be ‘prompted’ and asked if they want to make a change.” (Hahnel, Democratic Economic Planning, p. 125-126).

I hope this provides some more clarity regarding my statement/question.

So: is the only sensible response to a deviation > 20% (1) to kindly “ask” a consumer, “if they want to make a change”, or (2) should there at a certain point also be tangible penalty-fees, levied to maintain some minimum-discipline to stick to the plan (or revise the plan as accurately as possible) at least to a certain degree?

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I’ve never been under the impression that consumers will edit or resubmit plans during the year, and I don’t think that’s necessary. I think both authors (and they can correct me if I’m wrong) are referring to the behavior of consumers and are not suggesting that people will resubmit a consumption plan during the year.

I think the question you’re getting at here is “how will the plan adjust”? It’s likely the actual consumption will be different than what was proposed in the consumption plans. We can kindly ask consumers to stick to their plans, but what happens if they ignore that?

Like the books mention, there could be scenarios where no adjustments are required. For example, if the changes from one consumer cancels out the changes from another. However, additional steps will be required if the consumer deviations cause a product shortage. There are different ways you could deal with this, but I would not recommend punishing consumers with fees or anything like that. It’s normal for people to change their minds and/or behavior, so it’s up to the system to adapt accordingly.

There are many ways you could deal with supply shortages, but here are some that come to mind:

  1. Adjust the production plans so more products are being made.
  2. Have a policy where the products can only be acquired by people who included them in their consumption plan.
  3. Increase the price of the products so not as many people can purchase them.
  4. Scrap the current plan and create a new one using the annual planning procedure.

There are other ways too, but I think you get the idea!

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Alright, then I guess we have different understandings on this point. Like already said, as far as I understand the above mentioned citations, you indeed would have the opportunity to change your proposal, if necessary, during the year which would then update the aggregate annual plan. In would assume, since this mechanism (if actually used) would complement the (indirect) indicator of offer and demand by sales as an further (direct) indicator in the interim-assessments/monitoring, this could help to increase efficiency in the specific adaption/adjustment-measures of the annual plan (if necessary) due to better information and therefore I see no reason to abandon it.
So my point is not to focus on the different options for plan-adjustment during the year, which you have already summarized well and concisely above. I’m interested in obtaining the necessary information for this purpose. And, if you accept the second mechanism – i.e. revising your proposal during the year – as meaningful supplement (to supply and demand movements due to sales made), my question would be how to encourage to use him appropriately. Or put differently: Is the potentially resulting efficiency gain worth imposing penalty-fees, or is it negligible to the extent that it would be better handled without such restrictive incentives?

If your point is correct and there is no such mechanism at all for inter-annual adjustment of one’s individual production schedule, then of course the whole question/argument is moot.

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Thanks for the thoughtful reply!

I think the difference in understanding is coming down to terminology. You can definitely change what you decide to consume, but when you say “change your proposal” that makes me think people are expected to write this down somewhere and submit it like during the annual planning procedure. As I understand it, this consumption data would be automatically collected based on sales. To put it simply: the initial plan is based on predictions, while the plan adjustments are based on reality.

In many cases I imagine it would be redundant to submit a new consumption plan. Why do that when the sales data is going to show what you did anyway? The only time I can see this being beneficial would be if you’re signaling a change that the sales data wouldn’t show until months later. I suppose it would be nice if consumers tried to alert producers of this, but I certainly wouldn’t expect most people to do it.

In regards to efficiency, sending a new consumption plan is basically like submitting a new prediction. It could increase or decrease efficiency based on how accurate the new predictions end up being. Due to this, I don’t see a reason to push consumers to constantly update their predictions; just let the data from reality come in and make adjustments off that.

Perhaps Robin or Anders could clarify the quotes from the books, but that’s my understanding of it.

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