The unique aim of such a collectivisation is to yield an income to every member of the community, unconditionally. The State would simply act as the intermediary who transfers the dividends on your account. In this way, everybody feels that the collective ownership is his, not only abstractly but in facts.
According to the Marxist orthodoxy, socialism has two legs: state ownership and planning. I think that the market system is far more efficient than planning, which leads me to abandon the idea of planning. So we are led to design an economic system combining public ownership with market. It needs some imagination. In my proposition, the reformist government leaves the firms as it finds them. The only change concerns the shareholding (in favour of the State).
The traditional way to build collective ownership, from a capitalist context, is nationalisation, generally of big firms in strategic sectors. I am not a supporter of this kind of collectivisation, though I admit that it is admissible for enterprises of which the kind of activity is better run by the State, such as natural monopolies, public goods… In many European countries, a large part of these enterprises belong already partly or totally to national or local authorities. But to create a public sector for the sake of social justice (more equality) is a whole different ballgame. It is generally understood that nationalisation needs compensation of the ex-owners. This is sensible for nationalisations justified by common utility, but not when the aim is redistribution. When the State simultaneously gains and loses the same amount, the community does not become richer.
In 1982, the Mitterrand government (Union of the Left) has nationalised a series of French big enterprises, after having paid compensations to the ex-shareholders. I confess I do not understand the motivation of such a decision. Was the aim:
- To have influence on the management of these national jewels? Maybe but why? If the State were a better manager than private sector, it would be known.
- To preserve the economic independence of the nation? Then, the nationalisations are not match.
- To take better account of the interests of consumers? A good regulation would make the job.
The two headlines of my proposition are:
- A very high tax on bequests and on income. The tax would be highly progressive. The marginal rates would be as high as they were in the USA in the time of Roosevelt, but this applies naturally only to marginal rates. The rate would be independent of the family ties as it is in Anglo-Saxon countries (in contrast to European continental counties).
- The (slow) constitution of an investment fund, fed by surplus of the (high) taxes over public spending (which must not increase).
For many bequests, the exchange of shares would be the only way to pay the whole of the tax. Taxes paid in money are to finance the purchase of securities by the Fund at the Stock exchange.
The public investment fund is the heart of the system. It would be managed as are existing pension funds. Its managers would be interested in the return and the risk of their investments but would not take part in the management of firms in which they invest. With time, the fund would grow and after some years, it would be able to pay a not too low dividend to every adult citizen. The law would guarantee the independence of the Fund from government intervention.
Not intentionally, my proposition comes close to a well-known one, discussed almost all over the world: the universal basic income. The difference is that “my” dividend would not be a flat sum but would depend of the profitability of the productive sector.
So happens the building of an economy of mixed property. Many firms would keep their boss; private shareholders would keep some percentage of the capital of many firms but the State would become the major shareholder in the country. Undertakers would go on creating new private firms. The tax rules would be favourable to young enterprises.
This is the main pillar of my proposition of market socialism. But it is to be completed by two other ones:
- A good regulation. A strong regulation aims to make professional life agreeable (but productive) and to protect environment. Firms would naturally keep freedom of supply and pricing. Regulation does impair economic dynamism only where it troubles competition. When the rules are identical for all agents, they are considered as an unavoidable context.
- Joint-management with employees. This process has already prevailed in Germany for a long time. It does not prevent German enterprises being among the most powerful in the world. I think that this joint-management is necessary to check the salaries of the senior management.
Would the achievement of such a program lead to a classless society? Certainly not, but it would drastically reduce inequality without bringing efficiency into danger.
The main prerequisite is ideological. The general opinion about property rights must change. It is obvious that my proposition is at odds with the conception of the sacred right of property prevalent in our society. Many consider it as belonging to Human Rights, which confusion results from the historical fact that human rights were first expounded by bourgeois revolutions. A large social debate over these questions is necessary before any party could include my proposition in its program.