This is the alternative

…from the crisis of meaning to a challenge-focused democratic economy

This article was first published as part of OpenDemocracy’s Left Governmentality series

As the free market struggles there is a real need to think about what the alternatives might be. Margaret Thatcher famously claimed that “there is no alternative” to market capitalism. This system has generated wealth, but it has done so both by destroying the environment on which it depends, and by creating enormous human misery. As we enter the second decade of a global economic crisis to which no solution is in sight it is time to reconsider what the alternative should look like.

We know that there are a series of Grand Challenges which we must tackle. Climate breakdown threatens the very existence of our society, poverty blights the lives of billions of people, we are running out of antibiotics. We need a way to address these problems. But we must not lose democracy in this. Grand challenges are all-too-often deployed as a way to sideline democracy. What I outline below seeks to align an approach to our economy that aligns grand challenges with a more vigorous democracy to ensure that we use the technology at our disposal to tackle the challenges we must address.

It is particularly important to understand that free market capitalism’s strongest asset was its ability to effectively allocate resources in an information-poor context. Yet the world we live in, and especially our economy are now information rich. The business model of the big Silicon Valley companies, like Google, is entirely based on data for business (“if you’re not paying for it, YOU are the product”). What I propose is a method to turn this understanding of demand into social good, rather than trillion-dollar valued companies.

The failure of technocratic free-market-democracy

In the 1980s a trend emerged: public opinion data began to drive our politics. By having a data-rich approach to designing political programmes, parties could deliver what people wanted. The data was created through extensive polling and focus groups. Each policy or initiative was tested against public opinion to discern what was popular. In the UK, with Tony Blair as leader Philip Gould guided New Labour to massive election victories on the back of this approach. Hand-in-hand with the ideology of New Public Management, this transformed citizens’ relationship with the state, reformulating it around a consumer model. Citizens became mere customers of public services.

These twin-approaches were shaken by the decision to go to war in Iraq. And the combination of polling-led government and New Public Management finally foundered on the rocks of the global economic crisis after 2008. People were happy to be consulted if they thought the government was acting in their interests. Opinion-led technocratic government is only effective for as long as people believe that technocrats can make better decisions than they can. The decision to deregulate global financial markets made people believe technocrats were not capable of the basic technocratic skill – they weren’t very good at making decisions.

The technocratic society comes with a range of symptoms. People are disengaged and feel decisions are taken without them. This makes citizens skeptical about the ability of politics to deliver for people and reckless about the decisions they make when given the opportunity to vote.

We also have a lack of shared social goals. The deference to the market that characterises our society and economy has robbed us of any sense that we could or should approach big social or environmental problems as a society. Since the 1970s there has been a deeply held belief that the market will sort all of our problems out. And that the more elements of our society we financialise the more effective the solutions will be. We know that this is wrong. But what we lack is any structure by which to define and agree on what these shared social goals are.

Participation and deliberation in an economic system

Below I set out both how we can re-engage citizens in the process of making decisions and then how we can use that re-engagement to decide upon and tackle the grand challenges of our era. I draw on concepts around participatory and deliberative democracy and challenge and mission approaches in public policy.

I believe that we can draw these together to build the popular support for an economy that tackles the great challenges of the age, and does so with the efficiency that we associate with war economies.

Our society has changed substantially since the creation of the democratic structures on which we depend, in three key ways.

Firstly, we have substantially better-educated citizens. The 1945 Labour government chose to govern nationalised industries through much more traditional top-down structures because they believed that workers lacked the necessary skills to manage their own places of work. Whether this was true or not, it is definitely the case that today’s demos are very substantially better educated than that of the 1940s.

We also have a society and economy that is marked by substantially more choice and autonomy both in the workplace and in our everyday lives. Our lives are saturated with choice in a way that previous generations would not have recognised. From choice in school meals to the end of the job for life, we spend much more time making choices for ourselves. This extends to the workplace where most workers enjoy much more autonomy than they did 50 years ago.

Finally, we now have tools to disseminate a quantity of information at a speed previously unimaginable. We have the ability to transmit information at unprecedented speed and in unprecedented quantities, allowing decisions to be made in real time across different locations in much more informed ways. From social media to digital tools for deliberation there are methods that allow many more people to be involved in many more ways in understanding public policy.

Consumer culture has created citizens accustomed to a great deal more choice than our ancestors ever enjoyed. This stretches from the variety of produce available in supermarkets, to ‘fast fashion’ and the development of disposable clothes. All require citizens to define their identity through consumer choice. In the workplace, workers are expected to exercise judgement in a way Fordist or Taylorist industry simply did not expect. Even in precarious jobs with zero hours contracts workers are expected to exercise substantial choice and autonomy – reflected in the attempt to make these workers claim ‘self-employment’.

Currently, these developments are being deployed in commercial and organisational contexts but have yet to meaningfully enter our democracy. Many companies have adopted techniques and approaches like Buurtzorg social care cooperatives to use technology to maximise worker autonomy and bring increased productivity and happiness. In almost every workplace decisions are made or communicated electronically. Yet the main reactions from progressives have been either to ignore these changes or to demand a return to top-down technocratic approaches. Both are doomed to failure.

We can measure the success of democratic processes through the ability of people to accept an outcome that wasn’t their preferred option – what political scientists call “losers consent”. At a time when the opportunity to empower citizens has never been greater, we need urgently to understand how we can harness these developments to deliver social change.

There are a number of approaches in this area that can help to deliver a more democratic society. Michael Albert and others have codified this approach as participatory economics, which forms a basis for building a popular economy. The Participatory Budgeting and Planning approaches that are becoming more popular having been piloted by Brazilian radicals are important tools for making outcomes more popular. In Ireland, Citizens’ Assemblies have allowed two very well contested referendums on contentious issues (equal marriage and abortion) which enjoyed almost universal losers’ consent. Minipublics, citizens’ juries and a vast array of other deliberative and participatory tools are now available.

What is important, though, is not which tools we use. We need to get better, more practised and more comfortable with making decisions. Too often democracy is seen as divisive, scary and difficult. In reality, the alternative is totalitarianism. And perhaps the most important way we can change this situation is to develop methods that allow people to be heard through the process. That way we can facilitate losers’ consent, and build systems that generate confidence through decision making. Democracy has always meant decision making by the people. The attempt to redefine it has led us to where we are. We need to claim back the original meaning of democracy. We need to allow people to make decisions again.

Challenges and missions

However, we should not just use these tools within our existing systems: we need to find new ways to create shared societal goals. There is a move to creating and defining “Grand Challenges” that could act in this way. Some of these are based on the Sustainable Development Goals, some are set up by wealthy individuals, and some are set out by governments.

Instead of the aim of government being to grow the economy, it should be to address these challenges. The priority given to challenges and how they are defined can be agreed through deliberative processes. From the ageing society and climate breakdown to the role of humans in a world pervaded by data and automation, it is clear that the market cannot deliver the solutions we need. Instead, we should use deliberative processes to set out the priorities and resources needed to solve these problems.

For all that business leaders espouse free-market ideology, few businesses use these competitive processes internally. Indeed Sears (the American supermarket operator) tried, and has since gone into administration. The free market’s great advantage is that it is able to allocate resources in low-information contexts more effectively. But most businesses are high-information contexts, and our economy is now information-rich. We can use participatory and deliberative techniques to decide on what the challenges are, then use our information-rich economies to solve those challenges.

Mariana Mazzucato sets out how most private sector innovation is, in fact, the outcome of public sector research and development. In her dazzling book “The Entrepreneurial State”, she explains that even the highpoints of capitalist achievement, like the iPhone, are almost entirely based on public research. Public research gave us the touchscreen, mobile network technology and global positioning system technology that makes the iPhone a useful device.

She goes on to argue that the state can benefit from this investment through the creation of missions. I argue that these missions and the Grand Challenges with which they fit should be decided and defined through the deliberative processes I describe above.

The crucial aim of this process should be to create missions that are specific enough to create the change they seek, but also general enough to allow people to develop innovative solutions. The solution to eradicating poverty might be a universal basic income, or it might be universal basic services or a mixture of both. Or it may be a solution we have not yet developed. The challenge should allow for both testing of the options we understand and for new options.

Once we have decided on a Challenge, like addressing climate breakdown, it can form a focus for participation. At a stroke, we can overcome the silos and barriers dividing public and voluntary or private sectors. We can begin to unleash human ingenuity in the service of these Challenges. They can be broken down into missions that allow people to contribute. To take an example in the climate breakdown challenge: this might be broken down into categories from zero-carbon transport or decarbonising domestic heating systems. This opens the way for institutional, individual and government action towards these missions.

These Challenges could come from a number of sources. They might be drawn down from the Sustainable Development Goals, or from national structures like the Scottish National Performance Framework. Most importantly there should be a process by which citizens can trigger a Grand Challenge. This could be through a citizen’s initiative or official petition like the existing EU or Number 10 petition sites. It could also be through interventions by social partners (like Trade Unions or Professional Bodies) or elected representatives. At a continental or global level, this could be generated by national or sub-national governments.

To give a worked example, we might want to address the Grand Challenge of Climate Breakdown. This might be triggered by citizens, governments or social partners. It would then be broken down into missions. These might focus on reducing carbon emissions through energy, land use, transport, heat, construction or other major causes of greenhouse gasses. They could then prompt economy-wide action to reduce the use of internal combustion engines or to rewild for carbon reduction, or any of the other ideas that we haven’t yet pressed into action.

Because there has been citizen leadership and will be citizen involvement it creates a situation like a war economy. War economies are remarkable for their increased productivity and innovation. The advances in aeroplane and rocket technology during the Second World War are good examples of how war economies can create innovation. They are also very effective at prioritising investment for activities to tackle challenges. War is, of course, incredibly destructive, but creating an economic paradigm that replicates the mission-focus of a war economy with a less destructive alternative offers the benefits without the costs.

Citizen involvement should not be limited to the definition or prioritisation of challenges. Involving people in the development of policy through research, citizen science and social science, action research, crowdsourcing data and other mechanisms should complement the processes of definition and prioritisation. By increasing citizen involvement we can help broaden understanding of how decisions are made. This will strengthen public faith in those decisions and the processes and structures that supported their development.

Utilising the unprecedented wealth of information that saturates our world will make the free market look like a very blunt tool. Dealing with the real challenges of our age will reengage citizens in politics. And if we can focus our efforts on addressing challenges like climate breakdown we can secure a future for our society.

This will replace the current technocratic new public management methods with deliberative techniques designed to build public priorities into the policy process. It is the most effective way to chart a way forward that avoids the tyranny of the free market. It moves our collective decision making away from the market, and towards decision making on the basis of popular will.

It means we can begin to address popular alienation with the political process, through building out democratic processes into areas that have become dominated by the market. We can also build public expertise in decision making, creating better policy. But this goes well beyond policy, it is about creating ways to work together so we can create a better world.

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Rural Transport: Planes, Trains and Automobiles transformed

This provocation was written for Snook.

In “The Village” — the BBC drama by Peter Moffat, starring Maxine Peake, the modern age is ushered in by the arrival of a bus for the first time to the eponymous village in the Derbyshire Dales. My own grandmother cycled everywhere in rural south Armagh, on the Irish border, including a gasp-inducing 2-mile cycle whilst in labour — hours before giving birth to my mother. For many rural areas, transport has never really worked. For those who could afford cars, it might have been ok in the 1990s before the huge increases in insurance costs. But for those who can’t drive — and that’s both young people and many older people who didn’t learn — it excludes them from access to health and educational opportunities, jobs and society more broadly.

We have never created the rural equivalent of Mass public transport systems. As transport became more available to the working classes in cities, most people outside cities did not have access to that sort of transport. And when we came to design rural transport systems they were often done on urban models. All too often rural transport was designed by people with little experience of living in rural areas. This meant that as urban communities enjoyed growing connectivity, many areas outside our cities were left behind. The volume of passengers was never enough to sustain regular bus services, and sharing lifts went out of fashion in the 1980s, amid growing individualism and fear of crime.

We are now at a turning point. The rural bus is becoming endangered, and at the same time technology is changing how we move around. That creates the opportunity to replace a system that has worked for the few, but failed the many. Snook is interested in making sure that we put design principles at the heart of these changes, and that technology becomes a solution to the existing problems, rather than adding to those problems. We want to take an asset-based approach that knits existing social relationships with new technology to build an infrastructure that is a techno-socio-physical hybrid. That is, a new way of rural living that builds on existing connections to harness technology and overcome transport problems.

There are approaches like “Mobility as a Service”, which sees transport, not in traditional infrastructure terms (road building, buying new vehicles), but rather as a way of allowing people to do everyday things they need to do. By getting to work, educational institutions and health providers it helps people to be a part of society, and that’s what Mobility as a Service is all about. Improved accessible transport services can help us reduce isolation and loneliness. This is an important shift in focus and should inform how we adopt new technology. It starts with identifying where people need to travel and identifying how that need can be met. This is particularly important as it will allow us to build inclusive transport systems that accommodate people who can’t drive a private car — because of age, disability, or wealth. We need to replace dysfunctional transport systems with transit that works for all.

Here are four speculative scenarios that might transform rural transport, we are keen to work with you to help make these possibilities realities, delivered through human centred design:

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Platform-based lift sharing

The first shift that could happen is the development of an online or app-based platform for lift sharing. This would allow people to share journeys they are planning to take, or were taking, and they can pick people up on the way. This could also allow for mileage to be recompensed — this is in contrast to the Uber model of replacing taxi drivers. It’s about creating an exchange economy, rather than turning over existing jobs to big corporations.

This is both eminently doable, and something that is closely aligned with existing apps like Uber. The real question is — why hasn’t it happened yet?

That might be because the money behind Uber is massive, and no ‘not for profit’ provider has the marketing budget to embed itself in people’s travel habits.

However, by using behavioural science and working with big institutional partners we could get a platform to scale. By bringing together all the public agencies working in an area like Dumfries and Galloway, or one of the national parks, we could align commuting data and allow drivers to share their travel information with others. This could create the basis for a working rural version of demand-responsive transport. By mapping routes and getting public sector workers to explore whether they could offer a lift, we could begin to build a culture of lift sharing again.

This could also help people with picking up prescriptions, groceries and other helpful acts. The overspill benefits may include stronger relationships and better connections, with more reciprocity. We may see the emergence of shared electric minibuses doing shorter commutes that are no longer being served by buses. This looks like a 21st-century reinvention of the bus.

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Big technological shifts in electric vehicles and automation

We seem to be on the brink of a transformation in engine technology and automation. While it seems that full automation may be some way away, there’s a real chance that the task of driving will become much simpler over the coming years. Especially in the UK, the opportunities for energy generation in rural areas will also create opportunities.The Isle of Unst in Orkney has created a hydrogen economy making zero-emission transport the norm both by car and (soon) ferry, using surplus renewable energy. When there is more energy than is needed to power the island, it is used to create hydrogen, which then provides zero carbon transport. As renewable prices plunge this will become a more frequent approach — especially in wind and wave-rich rural areas.

The emergence of electric bikes and scooters with substantial ranges — often of over 20 miles, also gives us the opportunity to think through how we can do that tricky last mile of transport or even the sort of journey my grandmother did every day! At a lower price, and less maintenance than a car, and with very low running costs, these products may be transformational for rural areas. Bike sharing like the Santander sponsored scheme in London might make sense with electric bikes in rural areas.

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Changes in work make transport less necessary

We know that work is changing rapidly. Working from home is becoming more common. There are more co-working spaces, and an increasing list of tasks can be undertaken remotely. That’s mostly the case for what are (or were) office jobs, but it may become more widespread as small scale manufacturing using digital looms and 3D printers becomes more prevalent. This will create a repair economy, where fixing broken items becomes more common. The repair economy may be further facilitated through open-sourcing of plans for physical objects.

We won’t have to get in a car to get furniture, or a new fridge, we could get them manufactured locally. This will relocate jobs and reduce travel miles.

In some, cases drones will replace delivery journeys, and there may be an interesting reshaping of the nature of some rural journeys. There is the possibility of a ‘just in time’delivery approach (using drones to deploy parts as they’re needed) developing in rural areas, which will accelerate the move to small-scale local manufacturing. It’s possible that rural mail deliveries will be carried out by drone in the very near future. This will lead to the development of distributed manufacturing, much of which will be in rural areas.

Office jobs will be transformed by advances in teleconferencing, incorporating virtual reality and augmented reality. Co-working spaces will replace the office as the normal place for office jobs. Meetings will happen in salons where full interaction with colleagues in other locations will happen through virtual reality. 5G mobile phone technology and broadband rollout will need to keep pace with this, and that will be a vital pressure point for government and service providers.

If you don’t have to get in a car or bus to go to a manufacturing job, if you are going to a local coworking space for your office job, then your need for transport reduces substantially. This aligns with some of the Scottish Government’s Manufacturing Action Plan to grow smart manufacturing through optimising supply chains.

Rural transport will be best transformed by the human-centred adoption of technology

We know that technology will disrupt transport as we know it. We also know that if we don’t make the change in transport human-centred, it will fail to meet the needs of rural communities. That’s why design is so important. We need to use design principles to make sure that technology solves the vital problems facing us. By identifying where it’s is necessary, shifting the incentives for different types of transport and matching supply to demand; we can create inclusive rural transport. And that will help to end depopulation and keep vibrant communities in rural areas. If we get it right, the advantages enjoyed by rural areas may make them the preferred spaces to live.

If you’re interested in discussing how we can prepare for more effective use of new technology get in touch. I’m really keen to work with others to make sure we put people at the heart of adoption of new transport technologies.

You can visit the Snook website here: Snook. Illustrations by Isabella Bunnell.

If the free market is so great why don’t you go and live there?

Anyone advocating alternatives to free-market capitalism will soon find themselves challenged to back their beliefs by moving to a socialist country. When I was younger it was East Germany, I think it’s now North Korea. “If socialism is so great, why don’t you go and live in East Germany” articulates two things, firstly the failure of actually existing 20th century ‘socialism’, and the perceived hypocrisy of those advocating alternatives to the free market as a way of organising society.

But interestingly those who argue for the free market as a the way of organising society are strikingly reluctant to run their own businesses in these ways. When they do try to run companies on the principles of the free market, they fail.

This is exacerbated by the erasure of ways of talking about the world that aren’t about the free market. When we discuss how the world could work in different ways we have no vocabulary at either conceptual or linguistic level to describe alternatives to the free market.

But the fascinating thing about the free market is that it isn’t really the guiding principle of any of the big organisations whose leaders are its greatest cheerleaders. Almost every big corporation operates through information-rich planning processes.

Most don’t operate internal free markets, because they’re wasteful, inhibit innovation and promote damaging competition. In almost every circumstance they’ve been tried they result in gaming the system, rather than improved results.

It used to be the case that our economy was incredibly information-poor. When Chile tried economic planning in the 1970s they used telex in a fascinating experiment called Cybersyn. It didn’t really work.

But information technology is totally unrecognisable today, and could easily be deployed in developing economic plans in a way that was unimaginable in the 1970s. In fact, it’s this form of ‘information capitalism’ that made Google a trillion dollar company.

Sears, the US supermarket company, is probably the most notable corporate attempt at internal free markets. Sears filed for bankruptcy last year.

Yet we continue to use the free market as the sole guiding principle for our society. Time to think again.

Community and Economy: on the success of Highlands and Islands Enterprise

Highlands and Islands Enterprise (HIE) is a rare beast: an economic development agency that enjoys widespread popular support amongst the population of the area in which it operates. First set up as the Highlands and Islands Development Board in 1965 it has been successful in reversing the economic decline of the Scottish highlands and islands. And not only has it been successful, its success is widely recognised.

This is extremely unusual. Industrial policy is littered with the corpses of long-dead and largely unlamented agencies. From the inward investment approach of the 1980s to the ‘connected economy’ approach of the 2000s, the changing winds of policy have swept away a range of agencies. In Wales industrial development was taken back into the competencies of central government. In England, the Regional Development Agencies were replaced by Local Economic Partnerships that enjoyed substantially less resource.

In Scotland and Northern Ireland the equivalent bodies, Invest NI and Scottish Enterprise survived, but are regularly the subject of political opprobrium. In the run-up to the 2016 Scottish Parliament election, the Scottish Government launched an Enterprise and Skills Review in which the intention was strongly signalled that Highlands and Islands Enterprise and Scottish Enterprise would be merged to form a single body.

The mantra of the Minister needing to be seen to do something is all-too-often merging the unmerged and demerging the merged. So it seemed would be the fate of Highlands and Islands Enterprise. But a groundswell of support for HIE – the “Keep HIE Local” campaign – meant Ministers chose not to merge it with Scottish Enterprise. Indeed, such was the success of HIE that Ministers ended up committing to a new development agency, on the model of HIE, for the south of Scotland.

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So why is HIE so popular? Why did Highlanders fear its abolition so much they campaigned to save it? The answer lies in the unique element of its mission, that gives a pointer as to what successful inclusive innovation might look like. Almost every other economic development agency is tasked with growing businesses, seeking inward investment from transnational businesses and other economy-specific activities like knowledge transfer. HIE does these things too. But it also has a mission to support community development.

It is this twin commitment to economic and community development that has allowed HIE to support the hugely successful transfer of crofting estates into community ownership. It has allowed Highland communities to enjoy the benefits of widespread development of community renewables and it has helped to reverse depopulation and retain communities in many remote and rural areas. So much so that other areas of rural Scotland want a similar agency.

And HIE faces new challenges. Adaptation to climate change and the impact of the data economy and automation will change the way the rural economy works. As will the widespread deployment of drones, which could both threaten the much loved rural postie, but could also facilitate true just in time delivery.

Of course, seeing community and economy as interlinked to the point of indivisibility makes HIE’s job more difficult. But it also seems to be more effective than a separation of community and economy that risks appearing reductive and locating the economy outside the scope of the society in which it functions. HIE shows we can build a successful economy in a way that reduces alienation. And it does so in a way so successful that people are prepared to fight for HIE’s ongoing survival.