Rise of a New Economy

From: Fall of the American Empire and the Rise of a New Economy

 

Once the economic collapse of America has occurred, what then? We need to study what our economic options are. Esteemed economist Shrii Prabhat Ranjan Sarkar has provided to the world a glorious vision of a new economic model called PROUT (Progressive Utilization Theory), which contains guidelines for the creation of a new economy. He says that regional, self-sufficient socio-economic units must be formed on the basis of common cultural, geographic, social and economic factors. These socio-economic units may be affiliated in a federated system, but they must possess sufficient self-determination in their own local economic regions to create and control developmental policy.

Every region's economy should be organized into three types of enterprises: cooperatives, key industries, and small private enterprises. Cooperatives would form the core of the economy. Except for a few large-scale, key industries and small private enterprises producing nonessentials, all production is to be organized under worker-owned and controlled enterprises. Cooperatives increase worker motivation and job satisfaction because they give workers control of the business as well as a stake in its profits. When cooperatives have access to the requisite inputs of production—capital, entrepreneurship, skilled labor, and competent management—they invariably out-perform private, free-market enterprises. Cooperatives are controlled by their worker members on the basis of one member, one vote. All members must purchase a membership share in the cooperative. This initial capital contribution gives each worker member a financial stake in the business. Thus workers' ownership rights are based on their functional role as workers, and not on the basis of their capital contribution.

Very complex, capital-intensive industries, such as utilities or industries producing raw materials or goods which are strategic to the regional economy, should be designated as key industries. As they play a crucial role in stimulating production and development for the region, they must come under community control, not worker control. Key industries should be controlled either by the local or regional government, or by an autonomous board. That board or local government operations would hire a plant management team. Participatory team management techniques should be used to insure maximum worker involvement. An effective incentive system should be used to motivate productivity. Key industries should operate on a no profit, no loss basis. The state should not subsidize their operation, nor should the industry reap profits.

Small businesses—those having a maximum of about 5-8 employees—can be privately owned. Private enterprises should not be involved with producing or distributing staple commodities. Salaries of workers and income of owners should be subject to minimum and maximum standards established for the region. (In fact, today in Germany the people are on the streets demanding a minimum wage as well as a maximum wage for all workers!)

Economic planning should take place at the central, regional, and district levels. But, for the most part, planning authority should reside at the local level. The most basic unit of planning is the district. District boundaries should not be determined on the basis of political considerations, but on the basis of geographic factors, socio-economic requirements, common economic problems, and common aspirations of the people.