Economic democracy: Waiting for mutation

A spokesperson of the Aam Aadmi Party (AAP) recently clarified that it can be Socialist without being silly. This is unlikely to impress those who want market-driven growth in India. For them AAP’s stance on matters economic revives anxieties that leaning towards socialism is an incurable compulsion of Indian politics.

However it is much more likely that AAP is a manifestation of the ideological vacuum that has been caused by the dramatic collapse of state socialism and the more complex crisis of capitalism.

While much of the media attention is naturally focused on deciphering quite what AAP stands for, this enquiry should not be handicapped by knee-jerk opposition to either socialism or capitalism.

It would be far more fruitful to address the critical conundrum of our times – just what is economic democracy and how can it be realized.

In the ‘Frequently Asked Questions’ section of its website, AAP takes on the issue of whether it is a leftist party. “We are very much solution-focused rather than ideology-driven” is the answer. There is nothing to be gained, says the AAP site, by dividing political parties as left, right, center: “If the solution to a problem lies on the left we are happy to consider it. Likewise if it is on right (or in the center) we are equally happy to consider it.”

This would indicate that AAP shies away from ideology as something that diverts attention from the core objective – serving the common man. Thus it is an implicit champion of some form of economic democracy. But just what does this mean both in terms of principles and operational modalities?

While there is no clear answer to this question, AAP can draw strength from a strong underlying consensus that has emerged over the last few years among a wide range of people – be they activists, business people or ‘aam admi’. Above all, this consensus rejects crony capitalism and rapacious greed. Many of the same people are also committed to overall fairness, equal opportunity and are looking for win-win solutions.

These aspirations cannot be fulfilled by tweaking 20^th century models of socialism and capitalism or just seeking a combination of their best features. Instead we are in the midst of a mutation which promises to take us far beyond the sum total of what we learnt from the various political and economic experiments of the past.

Yogendra Yadav, the political scientist who has emerged as the chief architect of AAP’s ideological edifice, has recently spoken sympathetically about a pervasive mistrust of radical ideologies of the 20^th century. Yadav has also noted a growing willingness among a wide range of people to be both open minded and ideologically agnostic. “This is the ideological space we want to occupy, not the middle ground between Left and Right, but transcending this binary,” Yadav recently said in an interview to the Indian Express.

This is not uniquely AAP’s burden. Seeking such a value frame for political economy is a global undertaking and one of the most critical intellectual challenges of the 21^st century.

At one end of the spectrum, closer to the mainstream financial sector, is the global excitement promoting social enterprise and emerging interest in the concept of ‘shared value.’ The premise of social enterprises is that social justice and equity can be fostered through business models that are market based but seek to generate not just money returns but ‘profits’ in terms of higher incomes and environmental regeneration.

‘Shared value’ is a term popularized by American business gurus Michael Porter and Mark Kramer. Their premise is that “the capitalist system is under siege” – not because of a socialist resurgence but because business is increasingly seen as a major cause of social, environmental, and economic problems. Porter and Kramer’s solution is for companies not to focus exclusively on money profits and instead generate economic value in ways that also produces value for society by addressing its challenges and reconnects company success with social progress.

But promoting shared value and social enterprise cannot quite contend with, or contain, the bubbling global outrage over what intellectual Noam Chomsky famously called “profits over people.” Perhaps the most forceful expression of this angst was the cascade of ‘Occupy Wall Street’ protests two years ago.

John Elkington, the sustainability expert who 20 years ago coined the term Triple Bottom Line, is now skeptical about how the mainstreaming of this concept is diluting it. In a talk he gave at Gateway House in December, Elkington emphasized that there are severe limitations to a “shared value” approach because there are many contexts in which it is not possible to create a win-win deal.

India is certainly rife with such situations – notably where large numbers of people stand to lose their habitats and livelihoods in order to make way for mining or industrial projects. There are also competing needs for water and energy by urban India and its rural counterparts.

This will be the critical test for AAP’s fledgling quest for an ideological frame beyond the old divide of Left vs Right. Will the metropolitan members of AAP agree with or support the cause of people’s movements that are working for a more equitable spread of economic opportunities and environmental sustainability?

It may neither be fair nor practical to expect that AAP alone provide the answers. That is necessarily a collective and somewhat convoluted task in which people from all walks of life must participate.

Shadow boxing between timed-out images of socialism and capitalism is only a distraction from the real task at hand – namely, to figure out what are the non-negotiable core values which would enable us to negotiate competing claims to plenitude in both society and the marketplace.

Rajni Bakshi is the Gandhi Peace Fellow at Gateway House: Indian Council on Global Relations.

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