“When economic democracy – a world of human equality, democracy and cooperation – is the alternative, capitalism will no longer be seen as a lesser evil. When the working class, not a revolutionary party, is the agency of social transformation, change will be based on workplace organization, community mobilizations and democratic political action. The goal will be to transform capitalism into economic democracy through gains and reforms that improve living conditions while methodically replacing wealth-holders’ entitlement with human entitlement, capitalist ownership with community ownership and master-servant relations with workplace democracy.”
Economic democracy is described as an integral component of an inclusive democracy, in Takis Fotopoulos’ Towards An Inclusive Democracy as a stateless, moneyless and marketless economy that precludes private accumulation of wealth and the institutionalization of privileges for some sections of society, without relying on a mythical post-scarcity state of abundance, or sacrificing freedom of choice.
The proposed system aims to meet the basic needs of all citizens (macroeconomic decisions), and secure freedom of choice (microeconomic decisions). Therefore, the system consists of two basic elements:
(1) democratic planning, which involves a feedback process between workplace assemblies, demotic assemblies and a con federal assembly, and (2) an artificial market using personal vouchers, which ensures freedom of choice but avoids the adverse effects of real markets. Although David Pepper called this system “a form of money based on the labor theory of value”, it is not a money model since vouchers cannot be used as a general medium of exchange and store of wealth.
Another distinguishing feature of inclusive democracy is its distinction between basic and non-basic needs. Remuneration is determined separately according to the cost of basic needs, and according to degree of effort for non-basic needs. Inclusive democracy is based on the principle that meeting basic needs is a fundamental human right which is guaranteed to all who are in a physical condition to offer a minimal amount of work. By contrast, participatory economics guarantees that basic needs are satisfied only for public goods or are covered by compassion and by a guaranteed basic income for the unemployed and those who cannot work. Many advocates of participatory economics and Participation have contested this.
As part of inclusive democracy, economic democracy is the authority of demos (community) in the economic sphere—which requires equal distribution of economic power. Therefore, all macroeconomic decisions (overall level of production, consumption and investment, amounts of work and leisure implied, technologies to be used, etc.) are made by the collectively and without representation.
State Representative Bob Filner (D-CA) as H.R. 5257, proposed a basic income guarantee. According to the U.S. Basic Income Guarantee Network:
“The basic income guarantee (BIG) is a government insured guarantee that no citizen’s income will fall below some minimal level for any reason. All citizens would receive a BIG without means test or work requirement. BIG is an efficient and effective solution to poverty that preserves individual autonomy and work incentives while simplifying government social policy. Some researchers estimate that a small BIG, sufficient to cut the poverty rate in half could be financed without an increase in taxes by redirecting funds from spending programs and tax deductions aimed at maintaining incomes.
A cooperative is a limited liability entity, organized either for-profit or not-for-profit, that differs from a corporation in that its producing members, rather than investors, comprise the decision-making authority. By various names, cooperatives play an essential role in all forms of Economic Democracy. Classified as either consumer cooperatives or worker cooperatives, the cooperative business model is fundamental to the interests of economic democracy.
According to the International Cooperative Alliance’s Statement on the Cooperative Identity, “cooperatives are democratic organizations controlled by their members, who actively participate in setting policies and making decisions. Men and women serving as elected representatives are accountable to the membership. In primary cooperatives members have equal voting rights (one member, one vote) and cooperatives at other levels are also organized in a democratic manner.
In some Co-operative economics literature, the aim is the achievement of a Co-operative Commonwealth; a society based on cooperative and socialist principles. Co-operative economists – Federalist, Individualist, and otherwise – have presented the extension of their economic model to its natural limits as a goal.
This ideal was widely supported in early-twentieth century U.S. and Canadian leftist circles. This ideal, and the language behind it, were central to the formation of the Co-operative Commonwealth Federation in 1935, which became Canada’s largest left-wing political party, and continues to this day as the New Democratic Party. They were also important to the economic principles of the Farmer-Labor Party of the United States, particularly in the FLP’s Minnesota affiliate, where advocacy for a Co-operative Commonwealth formed the central theme of the Party’s platform from 1934, until the Minnesota FLP merged with the state Democratic Party to form the Democratic–Farmer–Labor Party in 1944.