Beyond Collectivism and Individualism Prout's Decentralized Economy

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Beyond Collectivism and Individualism: Prout'sDecentralized Economy

Prout writer Trond Overland explains clearly and simply how bothcapitalism and communisim involve centralized economies, with thecapitalist economic model putting power in the hands of a few wealthycapitalists and the communist model putting control in the hands of a fewparty-dominated planning bodies. In both scenarios, the common peoplesuffer like anything! In both scenarioes, the common people areeconomically exploited, generally without understanding the reason. TheProut economic model provides five important principles to ensureeconomic decentralization: (1) The resources of a region should becontrolled and used by the local people. (2) Production should be based onconsumption, not profit. (3) Prodution and distribution should take placevia cooperatives, since cooperatives by their very nature will guaranteeequitable distribution of wealth and decentralized economic power. (4) Onlylocal people should work in and control local economic enterprises. (5)Essential commodities should be produced by localcompanies/cooperatives - even if the quality may be somewhat inferior tooutside equivalent products, because it is far more important that localpeople have jobs!

by Trond OverlandIn both capitalism and communism there is economic centralization. Capitalismcentralizes economic control in the hands of a few big capitalists, whilecommunism centralizes control in the hands of party-dominated planning bodies.Centralized economies have failed to guarantee ever-increasing purchasingcapacity, or to eradicate exploitation and want. Economic planning loses efficacyif undertaken by people who are remote from productive activity. Planning muststart at the level where the expertise of local people can solve economicproblems and create prosperity. In the interest of advancing peoples all-round

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welfare, decentralization of economic control is essential.Prout's economic system follows five important principles of economicdecentralization.1) The resources of a region should be controlled and utilized by the localpeople. At the least, local people need to control production of the importantbasic necessities to insure their economic security. They should also process rawmaterials locally so that their natural resource endowment gets used as a securebasis for their local economy. Excessive dependency on import of raw materialsleads to drainage of capital and uncertainty of supply.

2) Production should be based on consumption, not profit. Production should beundertaken to meet the needs of the general population, not to create profit for asmall number of entrepreneurs. Production should be geared to local marketsand supply of basic commodities, rather than to export or supply of luxury goods.If this is done, there will be maximum local circulation of money, creatingincreased production, more jobs, and greater purchasing capacity. An economybuilt up around production for local consumption will attain much greater vitalitythan one based on production for export.3) Production and distribution should be organized primarily throughcooperatives. Cooperatives, by the nature of their structure, equitably distributewealth and decentralize economic power. At the same time, a decentralizedeconomy is essential for the viability of cooperatives: allocating raw materials for local use assures their constant supply to cooperatives and reduces marketuncertainty. Because cooperatives tend to serve local needs, there is also lessuncertainty of product demand. The economic certainty created by cooperativeenterprise will give local people a sense of economic security. Because of thisthey will support the cooperative system.4) Only local people should work in and control local economic enterprises. Localpeople are best qualified to guide the development of their workplaces so as topromote their own economic well-being. Outside economic interests should notinterfere with the local economy, and use of outside laborers should beavoidedespecially if there is not full employment of local people. The economy

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should provide employment for local people, and ensure that their skills andpotentialities are fully utilized. Opportunities must exist for employing educatedpeople in the local economy so they are not forced to search elsewhere for workwhich utilizes their talents.5) Essential commodities should be produced by local enterprises. Import of basic commodities should be restricted for a period of time in order to developlocal industries and prevent an outflow of capital. Although locally producedgoods may initially be inferior in quality, more costly, or less available, it isnecessary to shelter their production in the initial stage. Otherwise, local industrywill not develop, leading to decreased employment opportunities and control of the local economy by outside interests. If goods are locally produced, theeconomy will thrive, and capital will remain in the local area where it can enhancethe prosperity of local people. Free trade advocates feel consumers should havethe right to buy the best or cheapest products available. Prout gives greater importance to the right to be employed and have a stable, vigorous economy.Healthy economic development generally fosters quality of production. But if localcommodities do not satisfy peoples needs, steps should be taken to improve

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their quality or decrease their cost. _____________________________________ Source: Prout World, http://www.proutworld.org

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