Our association has written a collective review of Guenther Sandleben’s book on labour time calculation. Note: This text was translated using AI due to time constraints.

Review: Günther Sandleben: Society After Money. Labor-Time Calculation as an Alternative

The book by Günther Sandleben, recently published by PapyRossa, is an important contribution to recent debates on post-capitalist forms of economic organization, in which the market economy and the associated monetary form as a unit of economic calculation are being reconsidered. In addition to the so-called “cybersocialist” approaches, for example by Cockshott and Cottrell, which aim to simulate market movements—and thus market prices—through the collection of massive amounts of data, the idea of labor-time calculation also repeatedly appears in these debates. Anyone seeking an informed overview of the state of these debates, and also wishing to learn about the historical roots of labor-time calculation in early socialism of the left Ricardian school and its influence on the “scientific socialism” of Marx and Engels, will find Sandleben’s book highly recommended. He summarizes the various approaches with pointed brevity, without losing himself in them.

Sandleben’s main concern is to present the possibility of an economy-wide labor-time calculation that operates entirely without money or algorithmic simulations of markets or demand. The basic unit of calculation in this post-capitalist economic system is intended to be the average hour of labor, in the sense that for each industry, an average labor time should be determined for the respective products, which then forms the basis for an economy-wide transfer of goods in production and consumption. In this regard, the author is influenced not only by the reflections of Marx and Engels on a socialist society but also significantly by the text Fundamental Principles of Communist Production and Distribution. The latter was written in 1930 by a council-communist collective of authors (the Group of International Communists, hereafter GIK), which sought to distinguish itself both from social-democratic ideas of socialization and from Bolshevik state socialism. The aim of the GIK was a labor-time calculation based on collective ownership of the means of production. In accordance with this idea, Sandleben also distances himself in his book from the actually existing state socialisms, which were unable to overcome either money as a unit of calculation or the form of alienated wage labor, even though he duly acknowledges the early Bolshevik considerations on economy-wide planning without money from the initial phase of the October Revolution.

According to the author, his current aim is to more precisely determine the concrete implementation of this idea of labor-time calculation, since the GIK did not address certain crucial problem areas in their text: “How should the labor times contained in production facilities be distributed among the various economic goods that have required such facilities? And how is the labor time of the producers who operated these facilities assigned? (p. 48)” According to Sandleben, the existing managerial cost accounting in particular could provide a key for calculating the time expenditure for individual items and goods, which the GIK had “ignored” (ibid.). At this point, one could object that bourgeois cost accounting and its relation to labor time are indeed mentioned in the GIK text. However, it must be agreed with the author that the connection is not really developed in the GIK text, which is why his book can already be regarded, in this respect, as an excellent clarification of this issue.

The elucidation of the relationship between modern managerial cost accounting and labor-time calculation thus becomes the central theme of Sandleben’s book. The corresponding chapter begins with a sharp refutation of Ludwig Mises’ famous argument that an economy-wide exchange of goods would be impossible without money. The author convincingly demonstrates that labor time is indeed capable of replacing money as a unit of calculation. In line with Marx’s labor theory of value, according to which the price of goods already reflects the socially necessary average labor time, Sandleben clearly shows—using the methods of managerial cost accounting—that this already constitutes a hidden form of labor-time calculation. However, because it is a cost accounting system, operating with monetary values, it must always also take into account unproductive state interests (taxes) and owners’ claims (ground rent, interest, entrepreneurial wages), i.e., the appropriation and distribution of exploited surplus value. Here, the economist Günther Sandleben not only provides an illuminating insight into modern methods of managerial calculation—which he also links to Karl Marx’s findings in Capital—but he is also able to extract the rational core of this cost accounting with a view to labor-time calculation at the level of individual enterprises: “The methods known from cost accounting for recording and allocating costs could (…) be transferred to labor-time–based production chains; only that now, in place of cost values, units of labor time would be used. They would become methods for recording, calculating, and allocating labor-time units, modified and expanded by the new conditions of communal production (p. 119).” In this sense, his book makes an important contribution, grounded in economic theory, to the idea of labor-time calculation, which on the one hand avoids a merely abstract-utopian adherence to the idea, and on the other hand resists the temptation, due to a lack of alternatives, to reintroduce market-based elements that correspond only to capitalist property relations into such a utopia.

Regarding the question of how enterprise-level planning should be linked to economy-wide planning, the author himself remains largely undecided. He suggests an interaction between central “top-down” and decentralized “bottom-up” planning, which would be “dependent on institutional conditions, as well as on economic, social, and ecological factors” (p. 127). This is precisely where our critique comes in. In our view, central, economy-wide planning always implies a central bureaucratic planning authority and, ultimately, state power. While Sandleben rejects the Bolshevik model, he sees no real alternatives when it comes to planning institutions. In this respect, the GIK’s “addition method” (p. 48), which the author does not further discuss, was already a step ahead. In this system, the planning authority rests solely with the individual enterprises, which then organize the flow of goods in coordination with a “Public Accounting” system and in direct communication with other enterprises (productive enterprises for machinery and intermediate goods, as well as consumer cooperatives for the distribution of consumer goods), without the need for central direction or state intervention.
The advantage of such a decentralized planned economy would also be that niche needs and products could be taken into account, and that enterprises could respond to changing production conditions in a decentralized and individualized manner—always starting from the self-managed enterprises themselves, which thereby retain their initiative.

The crucial political prerequisites for such a socialist mode of production are largely not addressed by Günther Sandleben. Even in the GIK text, these questions are largely backgrounded in favor of presenting the new method of economic calculation. This can, for example, be seen in the whole complex of issues concerning simple and complex labor. In this respect, Sandleben is unfortunately not sufficiently clear. While he writes that there are “good reasons” not to “take the degree of complexity of labor into account when recording labor times” (p. 73), he then goes on, using the example of time-banking circles, to discuss various technical implementation options based on labor-time calculation (such as paying one hour of work as two hours), without taking a clear position himself.

We take the consistent position that every hour should count equally, and not just because the work of a bricklayer is often physically much more demanding than that of, say, a teacher, nor simply because the argument that one has invested far more money and time in one’s own qualifications no longer applies—since in the society we envision all forms of education would be provided by the community—but above all because we assume that a new economy must also bring with it new egalitarian forms of social relations. Only under the principle that every hour counts equally does the possibility disappear of using differences between mental and physical labor, gender differences, or ethnic differences to organize power hierarchies through unequal compensation. It is only through a decisively egalitarian labor-time calculation that such differences would lose their political character. In this sense, we view the creation of new forms of social relations among people as the purpose of a new socialist society, and the socialist economy based on labor-time calculation only as a means to achieve this purpose. However, this purpose must already be present in all labor relations. Collective ownership of the means of production must be genuinely practiced in a new society and must not be misunderstood as merely a legal change. We consider a decisively democratic and egalitarian labor-time calculation to be both a prerequisite and a consequence of collective ownership. We believe that Günther Sandleben ultimately shares this position with us, but his rather technical presentation of the methods of cost and labor-time calculation could give the impression that these are primarily technical problems. Indeed, on p. 85 of his book, he writes: “It will be seen that the task can only consist in transferring the practices of cost accounting to labor-time calculation.” Yet, as he himself has shown, bourgeois cost accounting already includes enterprise-level domination and exploitation, and nevertheless, in capitalism, managerial rationality is often understood as a rationality that deals only with purely technical conditions. We remind the reader that economics has always also been politics. In this sense, the book Society After Money: Labor-Time Calculation as an Alternative should be read as a significant contribution to the ongoing and forthcoming debates on the development of a new social order, despite any criticisms.

Guenther Sandleben: Gesellschaft nach dem Geld. Arbeitszeitrechnung als Alternative. PapyRossa Verlag, March 2022, 159 pages.