Beyond the Welfare State: John Rawls and Proprietary Democracy
All over the world, the political left is plagued by right-wing populism. Faith in democracy and human rights is at an all-time low for young Westerners. In France, the main center-left party has been all but ruled out as a presidential candidate next year. In the United States, it began to be shown who to blame for Trump’s election, and in Italy the prime minister resigned after the failed referendum was seen as a vote of no confidence expressed by popular discontent.
But why the populist wave? Why now?
A philosopher has a suggestion as to why this is happening. The current economic model that the major center-left political parties have been using for twenty years is not satisfactory and must be replaced; but with something that offers a clean break and improves the live for everyone.
The late American political philosopher John Rawls argued that the welfare state, defined as a capitalist system where the state ensures a basic level of survival for citizens but does not interfere with major economic decisions, will not ensure that citizens have a real chance to influence policy or have sufficiently equal opportunities in education and employment. The welfare state will therefore generate a demoralized subclass. An underclass that will vote as it should to try to improve its position.
Hmm… people would feel like they don’t really have a say in who’s running the country? Reduced opportunities as incomes become unequal? Dr Rawls may have been on to something, philosophically speaking.
What then would it replace social capitalism with? How would he solve the problem of denial of the right to vote and dissatisfaction?
First of all, a little lesson in philosophy. Rawls postulated two principles of justice which he called Justice as equity, based on what he assumed we would all want in the company if we weren’t sure where we stood in it – an excellent overview of his philosophy can be found here.
These principles of justice as equity are:
First principle: each person has the same unassailable claim to a fully adequate regime of equal fundamental freedoms, which is compatible with the same regime of freedoms for all.
Second principle: Social and economic inequalities must satisfy two conditions:
They are attached to functions and jobs open to all under conditions of fair equality of opportunity;
They must be to the greatest benefit of the less privileged members of society (principle of difference)
With the first principle always taking precedence over the second, and equality of opportunity taking precedence over the principle of difference. The first principle also includes the idea that political freedoms must have “”just value“.
This is why he rejected the welfare state, because great economic inequalities would still be allowed, and the fair value of political freedoms is no longer assured because a handful of tycoons could dominate the political life of the state, leaving the majority of the population with little real political power.
So if the welfare state does not fit these two principles, what does it do?
Rawls proposed two systems which would satisfy his principles. One was democratic socialism, the other was a system he called proprietary democracy.
Proprietary democracy is a system in which the state ensures that the average individual has a chance to actively participate in the market economy around them, rather than just making sure they don’t starve. This system, he suggests, will lead to a larger share of the population owning productive assets, having real political power, and having a real chance of advancement than the rudimentary welfare state.
In such a system, the state would ensure that everyone has excellent education and vocational training options that they can actually use, access to health care and the ability to choose a job without fear of horrific consequences. if he is faced with unemployment, and an atmosphere of freedom to make life choices. Such a system would also ensure that most people have a real opportunity to own productive assets, rather than allowing monopolies to dominate the economy.
The main difference between this and democratic socialism, according to Rawls, is that socialism involves companies owned by workers, or by the state. Whereas a democracy that owns property always involves private ownership of the means of production. Rawls cared less about who owned the elements of the economy and more about the effects of that property.
What is the real version of this system?
There are many examples. The Nordic model, as Icelandic President Ólafur Ragnar Grímsson explained, sums it up pretty well. Similar ideas are seen in the thinking behind the Great Society in the United States, particularly in the promotion of university aid during this time.
Is this what people want? Some commentators think so. Mayor Bill De Blasio of New York has stated his belief that, “the message would have won the election” if the Democratic Party had run on Bernie Sander’s message of equality and progressivism. In the UK, Her Majesty’s most loyal opposition is led by the Labor Party, led by shameless socialist Jeremy Corbyn, who has retained control of his party despite adversity. Of course, a majority of Americans still wouldn’t vote for an openly socialist candidate, and many people think President Obama, a centrist NDP, is himself a socialist. This suggests strong opposition to the progressivism demanded by Justice as equity.
John Rawls was the most important political philosopher of the 20th century. His ideas continued to deeply influence philosophical thought, even the works of those who disagreed with him. His ideas on how to make liberal democracy work for everyone are vitally important to anyone who wants to understand why unrest is happening in Western countries and what we can do about it.