Today, people are free to buy what they want in competitive markets. However organising consumption like this has a number of problems. Income inequality creates a “one dollar, one vote” system, so the things produced are skewed towards those with more money; many markets are monopolies or oligopolies; collective services are underproduced; and, our wants are warped by advertising and market mispricing.
Like production, much of the activity with consumption is social. Therefore consumption in a participatory economy is organised to:
- Enable citizens to participate in decisions around consumption of public goods where they live via their neighbourhood Consumers’ Council.
- Enable people to express their preferences for public goods and services as easily as they can for individual goods.
- Enable consumers to provide useful information to workplaces during the annual planning to help them to plan what to produce.
- Have a democratic influence over wider public services in their towns, cities and nationally via the election of delegates to consumer federations.
The Consumers’ Council
Every individual, family, or “household” is a member of a direct democratic decision-making body where they live, called a neighbourhood consumers’ council where each member has one vote.
The size of a neighbourhood consumers’ council will vary in size depending on where one lives, but could typically be made up of around 100 or more people who live on the same street or block as each other. Meetings could take place face-to-face and/or using online technology.
Members of a neighbourhood consumers’ council:
- Meet to make proposals, participate in discussions, and vote on which collective goods they would like to consume in their neighbourhood.
- Elect and send delegates to federations of consumers’ councils to formulate plans for public goods for the suburb, city and nationally for members to vote on.
- Participate in decisions around the redistribution of income to other members based on special need requests.
- Take part in an annual democratic planning procedure by providing information to workplaces about what goods and services they expect to consume for the year ahead.
Why do we even need organisations for consumption?
Like production, consumption is also a social activity. Decisions about what we consume have an influence on others in society and therefore we need institutions for organising the planning and coordination of consumption.
Having consumer councils and federations is necessary to enable everyone in society to participate in planning the economy by providing helpful information to workplaces about what to produce for the year, any changes, and to organise production and the division of jobs.
Consumer councils are also necessary to enable all citizens in society to make proposals, deliberate and make decisions around local public goods. It is very difficult to do this within the market system without the government taking on the role. This still leads to an undersupply of public goods.
A consumer council could also be combined with the political system and act as the local primary level decision-making body for political decisions. For more, see participatory polity
Won’t there be too many meetings?
For planning individual consumption during the annual planning, you won’t need to meet with others in your neighbourhood council. You can complete your personal consumption proposals by yourself in your home.
For making decisions around collective consumption and choosing roles, such as delegates, meetings would need to be organised and can be spaced out during the year. The frequency of meetings, for example whether monthly or more or less frequently, would be up to the neighbourhood members to decide. These meetings would be voluntary and not mandatory to attend.
How are decisions made in the consumer council?
The goal is to maximise self-management by giving people a say to the degree they are affected by decisions. Below are some possible approaches and techniques towards helping this goal and increasing participation.
Within meetings, councils could use participatory decision-making practices. These could include things like using round robins, paired listening, breakout groups, temperature checks, and using participatory hand signals, such as for making a direct point, a clarification, a technical point, jazz hands for agreement, etc. Roles could include a facilitator, a note taker and a time keeper that can all be rotated.
Members can make proposals for collective consumption, ideas are discussed, refined into fully costed projects, and then members make a final decision by voting. This could be by consensus or by majority rule depending on how they want to go about it.
Related Real-World Examples
Vauban Community, Freiburg
Vauban is on an old disused french military base in Freiburg Germany. The residence got together with the local council to decide on how it should be best used. Through the community having a say in the decision they created ‘a sustainable model district’ with it being first housing community in the world where the homes make a positive energy balance.
There is space for walking and cycling plus more public transport and around 70% of people chose to not use cars. Vauban shows you what is possible in a democracy if individuals are allowed to have control over their community.
A Citizens’ Assembly
A Citizens’ Assembly is a representative group of citizens who are selected at random from the population to learn about, deliberate upon, and make recommendations in relation to a particular issue.
The process starts with a learning phase involving presentations by experts, group discussions and access to a range of source materials. Participants listen and quiz experts on a particular issue and then deliberate to arrive on a decision based on the public interest.
Citizen assemblies can be used at any level: local, municipal and national, and have been used successfully in various places including Canada, Ireland, Poland and Holland.
Community Land Trusts
Community Land Trusts (CLTS) are non-profit membership organisations that acquire and steward land in a “trust” for the permanent benefit of a community.
A CLT holds ownership of land in perpetuity, while residents rent or buy the homes or stores that sit on the land via a land ground lease with the CLT. This ensures the long-term affordability of the housing for the benefit of the community.
Local people living and working in the community must have the opportunity to join the CLT as members where each member gets one vote. Those members control the CLT, usually through a board being elected from the membership.
The Participatory City in East London
The Participatory City is a project in Barking and Dagenham in East London to co-create the first large scale, fully inclusive, practical participatory eco-system.
The project aims to promote social inclusion and democratic participation with over 250 neighbourhood-led projects around skill and resource sharing, enabling families working and playing more together, batch cooking and community meals, food growing, tree planting, trading, making and repairing.
Cohousing communities are intentional communities, created and democratically run by their residents. Each household has a self-contained, private home as well as shared community space. Residents come together to manage their community, share activities, and regularly eat together. Decision making in cohousing communities is often based on forming a consensus within the community.
Collective consumption are goods and services which are consumed collectively by a group of people or wider community, rather than consumed individually. For example, parks, libraries or leisure centres.
Today, while it is easy to walk into a shop and consume a good as an individual, it is much more difficult to express your preference for consuming collective goods and services.
Collective consumption often has a number of advantages over individual consumption, including cost-saving, enhancing community and reducing our environmental impact.
To give people a choice and make it just as easy for anyone to express their desire for collective goods and services as for individual consumption, any member can make a proposal and vote for a collective good via their neighbourhood consumers’ council. A typical process could be as follows:
- Ideas and priorities for collective goods and services are discussed between members
- Specific proposals are developed, put forward and costed
- Proposals are discussed and voted on
- Accepted proposals are submitted by the neighbourhood consumers’ council during annual participatory planning
Collective consumption does not have to be limited to more obvious things, like parks and libraries. People could also choose many other things too, such as, a community music studio, a community gym, a community kitchen, communal eating area, or anything else that residents want.
As well as funding local collective goods and services in their neighbourhoods, citizens, through their councils, would be able to express their preferences and vote for collective goods and services for their city and nationally, such as transportation, healthcare, fibre broadband, or online media libraries for the digital commons.
How is this different to collective consumption by a local government body today?
The lowest level government body today, such as a borough or district, is a representative body covering a large number of people. Representatives are elected every four years or so.
Instead, a neighbourhood consumers’ council is a direct decision-making body made up of a smaller size of people (e.g. 100 people, the exact number will vary and be worked out through experience) that live together in a community where every member has a vote on decisions. It is not a representative body.
Neighbourhood consumer councils participate in an annual democratic planning procedure to participate in the economy, whereas local government bodies today do not.
Higher level consumer councils in the federation are made up of delegates which are recallable and rotatable and may be requested to formulate referendums by sending councils on contentious issues. Whereas, government bodies today have representatives typically from political parties which are hard to recall and are not rotated. There is typically no direct decision-making in practice.
If I don’t use a collective good, do I still pay for it?
Individual members are charged with their share for the cost of collective goods. The charge for each individual member need not necessarily be the same and could aim to reflect estimated differences in the use of the service. It is up to the councils and federations to decide how to distribute costs for collective goods and services to their members.
What things make sense to be consumed collectively?
This is up to citizens in a participatory economy to democratically decide. A society could choose to have no collective goods at all, or they could choose to have many.
However, some things make a lot of sense and are more efficient and environmentally friendly to be consumed collectively. For example, things like parks, libraries, transportation, education and healthcare. This could also include less obvious things, for example a digital music streaming service or a community kitchen.
We can expect citizens would choose a greater amount of public goods in a participatory economy than exist today, because having membership and a direct decision-making say in one’s neighbourhood consumer council enables people to express their preferences for collective consumption much more easily.
Related Real-World Examples
Participatory Budgeting is a democratic decision-making process, in which ordinary people living in a community decide how to allocate part of a municipal or public budget.
Participatory Budgeting started in Porto Alegre, Brazil, in 1989, as an anti-poverty measure that helped reduce child mortality by nearly 20%. Since then it has spread to over 3,000 cities around the world, and has been used to decide budgets from states, counties, cities, housing authorities and schools.
The typical process starts with proposals initiated by citizens, which are then publicly deliberated with a committee to finalise the projects to be voted on. The draft budget is shared to the public and put for a public vote. The municipal government implements the top proposals.
Participatory Budgeting in Brooklyn, New York
Participatory Budgeting is used in community assemblies around the United States. This short introductory video was made in collaboration with the Participatory Budgeting Project.
Participatory Budgeting in Porto Alegre, Brazil
Modern participatory budgeting was born in the Brazilian city of Porto Alegre. These assemblies select representatives for each neighbourhood to review the priorities from every district, and then in turn to elect a Municipal Council of the Budget to reconcile all the various demands from across the metropolis.
Participatory Budgeting in Paris, France
The participatory budget in Paris is the largest ever implemented in the world. Residents of France’s capital can propose ideas for and vote on what 5% of the city’s budget will be spent on every year.
Income for Need
In addition to providing income for people’s efforts at work, society will also want to provide income to certain sections of the population based on need. This is already common in some form and to varying degrees today, for example, pension income to those who are retired, or benefits to those who are unable to work.
Income in a participatory economy is received in four ways, through:
- Remuneration for Work – workers receive income based on their levels of effort or sacrifice in their workplace.
- Compensation for damage caused by pollution – citizens can apply for membership to communities of affected parties (CAPs) and receive compensation for harm caused by emissions of pollutants.
- Allowances – children, retired, disabled, students or other category groups can receive income through national allowances. These levels and categories of needs-based allowances could be increased and extended to any groups in society as decided democratically by citizens and enshrined in a constitution to protect minority rights.
- Special needs requests – for any situations which are not covered by national allowances, anyone is free to apply for extra income for special needs in one’s neighbourhood consumer council or federation.
Why not distribute only based on need?
While it makes sense to distribute income based on need to those who are disadvantaged or to those who are too young or too old to work, it is recommended that income received from work is for effort and sacrifice for the following two reasons.
Firstly, it is unfair – only distributing based on need doesn’t take into account the sacrifices people make at work. It is only fair to compensate those who choose to work harder, longer or perform more unpleasant or dangerous tasks.
Secondly, it is hard to evaluate whether one person’s need is greater than another’s. In a situation where two people have comparable circumstances, on what basis does one get more than the other? This could lead to acrimony and feelings of injustice
Ultimately in a participatory economy power rests with citizens, and any groups of people within their self-managed neighbourhood consumers’ councils, workers’ councils or federations, could choose to experiment with greater levels of income for need as they wish.
What about Universal Basic Income (UBI) or Universal Basic Services (UBS)?
In a Participatory Economy there is fair income from work as well as income for those in need, and full employment is provided through democratic planning. This would reduce the need for a Universal Basic Income (UBI). However, whether some form of UBI is chosen is a democratic choice.
Universal Basic Services (UBS) are to do with national collective consumption. UBS could be more prominent within a participatory society as preferences for collective consumption are more easily captured through federations of consumers’ councils. For example, citizens may choose to extend universal basic services beyond only things like healthcare and education to also include transport, digital broadband and any other services they wish.
Related Real-World Examples
Universal Basic Income (UBI) in Alaska
The Alaska Permanent Fund pays an annual cash dividend to every citizen of Alaska between $1,100 to $2,072 per citizen, which is $4,400 to $8,288 for a family of four.
The Social Welfare System
The modern welfare system was fought for and won by populations in many countries in the early 20th century. Many countries around the world today have government administered welfare systems, which provide support for those in old age, support for the maintenance of children, universal healthcare, parental and sick leave, unemployment and disability benefits. However, many of these services have been under attack since the 1980s and the emergence of the neo-liberal economic agenda.
There are public goods and services that we use with larger groups of the population than just in our neighbourhood. For example, using a library in our suburb, transport in a city, or a national education service.
Because collective goods should be decided on and funded by all those who primarily use the service or good, consumer councils are grouped together into federations of councils across larger geographical areas.
Every neighbourhood consumers’ council selects a person to represent the views of the members of their neighbourhood, called a delegate. Neighbourhood delegates are sent to democratic decision-making bodies to discuss and make decisions with other delegates around public consumption that affect larger geographical regions from the ward, city, regional all the way up to the national level.
These federations of consumer councils are organised in a nested bottom-up decision-making structure to enable those affected to have a say at the appropriate level.
At every level of a consumer federation, Research and Development (R&D) units would be attached to provide expert independent information to support consumption decisions.
As with workplace delegates, consumer delegates are accountable to the consumers’ councils that send them. To safeguard self-management and ensure power is kept bottom-up, each delegate is:
- Rotated – the role is rotated between people to prevent any one person monopolising the position
- Mandatable – they can be instructed to vote a certain way over any particular issue by the sending consumer council
- Recallable – they can be recalled and replaced at anytime by the consumer council that sends them
Do representatives in higher councils get paid?
Yes, pay is according to effort like any other job in the economy.
How many federation levels would there be?
This would be for a future participatory society to decide and would depend on the population size of a country.
For example, for a country the size of the United States with a population of around 330 million, if there were 50 people on every council, then this would require five federation levels to cover the whole country.
See Stephen Shalom’s essay on a nested democratic council structure for a participatory political system for a more detailed examination of this topic.
What are the main tasks that consumer federations perform?
The main function consumer federations serve is to make decisions around collective consumption. In every council level from ward up to the national, representatives propose, debate and vote on what collective goods and services to fund for their respective area and submit proposals during the annual participatory planning.
During the year, consumer federations negotiate with the industry federations to adjust the current year’s plans where necessary.
Consumer federations also organise shopping outlets, represent and protect consumer rights, produce product information and organise independent testing and reviews of products to help consumers make informed decisions (similar to consumer organisations today, such as which.co.uk) .
Related Real-World Examples
Council Confederations in Rojava, Syria
In the Kurdish controlled region of Syria called Rojava, they have organised their decision-making system around confederations of democratic councils.
The Free Territory of Makhnovia
The Free Territory, of Makhnovia, was a stateless and egalitarian society in Ukraine. Millions of workers and peasants were organised into communities governed via a process of participatory democracy and were linked via a federation of councils.
The Ethical Consumer Co-operative
The ethical consumer is an independent, not-for-profit, multi-stakeholder co-operative with open membership, based in Manchester, UK, which provides information to help consumers make informed and ethical choices.
Consumer federations in a participatory economy would also function to protect the interests of consumers by providing impartial advice, information and reviews about products.