At last nights meeting of the Missoula International Organization for a Participatory Society (IOPS) there was a good discussion around the theoretical precepts of Parecon or Participatory Economy. There are various concerns that, especially on the scale of global society, proposed non-market mechanisms for determining production and allocation would turn into bureaucratic nightmares.
It is difficult to imagine our fellow capitalist "citizens" actually participating in Council meetings and drawn out iterations over who gets what, over what is socially valued labor, or over what natural resources should be devoted to which sector of the economy, considering how little people participate in their own governance or politics. This "self-management" is described as utilizing "simple communicative and organizing principles" but as many of us who were involved in Occupy know, there is nothing simple about organizing or communicating.
Another question arose around the "norm for decisions": "..methods of dispersing information and for arriving at and tallying preferences into decisions should convey to each party involved influence over said decisions to the degree he or she will be affected by them." It is true that a metric for measuring the degree to which you are affected needs considerable thought, especially when you enter the more subjective realm. Some could insist they are greatly affected by the flapping of a butterflies wings in Nepal.
It could be argued that the success of capitalist markets rests at least in part on the way competition harnesses and directs Desire for the lost object, to put it in Lacanian terms. The struggle for identity and for commodities is left to The Invisible Hand, whereas in a council system, we would have to confront Our Community. So there are questions of scale (might work in the particular but not universally), questions of psychology and "human nature" and questions of design and each deserves consideration.
But at the heart of this project is the over-arching question: What is democracy and are you a democrat? One instructive place that democracy works, as expressed in governance and law, is driving. Here, the General Will( Rossueau) is expressed as: We all want to get around safely at a certain speed. How to do this? We all have to agree to sacrifice some degree of sovereignty to the collective body in order to secure certain advantage. It's not hard to imagine the results of a Mad Max, competitive system, where those with the biggest tanks win. Instead we set up signs and laws and jails- and this is done all over the globe (to varying degrees).
I think there is another, more elusive principle at work as well, and it is actually similar to The Invisible Hand. The Hand is a symbol for the Cosmic Force (Cosmos) which theoretically integrates and transforms the Desire (self-interest)of Each into a Pareto- efficient or optimal outcome for All. Unfortunately, markets depend on perfect information to function and can't account for externalities. They are fatally flawed in many other other ways addressed in familiar critiques. Basically, they don't pretend to address justice or equality.
Radically Democratic Participation, on the other hand, has precisely those just outcomes, rather than efficient ones, as its goal. And just as natural ecosystems transform diversity into resilience, the sheer diversity of Desire expressed by the demos in a process where dignity is deemed essential will produce rational( just) outcomes for All in the aggregate. As the human brain/psyche becomes conditioned by ever greater individuation, diversity and plurality, the greater it's capacity towards integration, empathy and compromise. In this way society becomes more resilient, the economy becomes more just and "the full development of each becomes the condition for the full development of all." Voila.