Right now the economies of the world are controlled by three powers:
Governments, the private interests of the wealthy, and individual consumer decisions.
Government Power over the Economy
Governments exert their power and influence over the economy through:
Fiscal Policy, they decide who and what they are going to tax and how much they will tax, and they decide how much they are going to spend, where and who they are going to hire.
Monetary Policy, the government decides how much money to create and inject into the economy and how much money to destroy and subtract from the economy. Usually, more money injected into the economy means more economic growth, less unemployment but more inflation. And the opposite is also true when the government destroys money, the economy contracts, there is more unemployment but the value of the currency tends to go up.
The government doesn’t really need to ask for loans to generate money in its own currency, but most governments do because they want to inject the new money through the financial systems, and by doing so, they benefit the owners of the financial system.
Trade Agreements, through trade agreements governments greatly influence the economy of their countries, not just because new products can enter or leave the country, but because the workers of one country will need to compete for the same jobs with the workers of another country. Trade agreements influence how much money, goods, and services flow from one country to another and how much wealth and benefits remain in each country. For example, if a country has oil, and has an open borders agreement, other countries might extract the oil, sell it to other countries and generate no wealth for the country from which the oil is being extracted.
Worker Rights, governments legislate to protect workers and consumers and by doing so they influence the economy. For example, if there are no worker rights and the resources of a country are in the hands of a few people, then most of the people in that country will have to work in the conditions stipulated by the few people that control everything.
Environmental Protection, governments legislate to protect the environment and a country's resources. Usually, the most profitable way to extract natural resources and to transform them into products is by disregarding any environmental consequence.
Incentives and subsidies are also a tool the governments use to influence the economy, to produce something that might not be easily produced without incentives or subsidies.
In fact, every single action of a government affects the economy. For example, if there is no security and state of law and order, the economy usually contracts, because people go out to spend less and have to spend more on security and other non-productive activities. Another example is the bureaucratic steps people have to take to start a business.
These are just some examples of how the governments have power and influence the economies of each country and the world.
The Power of the Wealthy
Right now 10% of the world’s population controls 80% of the world’s resources. (Credit Suisse Bank World Wealth Report 2019)
From 2009 to 2012 the richest 1% Americans captured 95% of all income gains in the country. (Business Insider, Aug 3, 2020)
From 2009 to 2020 the wealth of the billionaire class in the United States increased by 80%. (Business Insider, Aug 3, 2020)
From March to August 2020, during the start of the Covid-19 pandemic, 40 million Americans filed for unemployment while the American billionaires increased their wealth by $637 billion. (Business Insider, Aug 3, 2020)
This is because our financial and economic system is designed to almost always generate some profit for the 1%. Every single thing you buy on Amazon, Walmart, or the convenience store generates profit for the 1%. Every time you pay any kind of interest on loans or credit cards, they mostly go to the 1%. There is no free market if the 1% or the 10% control most of the things that are being produced, distributed, and sold. They have the money needed to start any business, they control the natural resources needed for any type of production, and they control the market places where the products are sold.
For example, when you go to a store you might have 50 different types of chips you can choose from, but must of them are brands owned by two or three corporations. Almost all the products you have available right now are produced by the same corporations. You might have the illusion of freedom when you choose among their products, but they decide what options will be available for you, and every time you buy a portion of your money goes the 1%.
This is not just some issue of some people having more than others. If everyone had enough, and everyone had freedom and self-determination, it wouldn’t necessarily be a bad thing if some people had more extra cash than others. If a couple of people could buy more shoes, clothes, or cars, or if they could go to more luxurious restaurants or destinations on their vacations. But the fact is that many people are struggling with poverty or near poverty conditions, while a few others control 80% of the world's resources. And the problem is not just that some don’t have enough and others have in excess, but that the amount of economic inequality that exists transforms itself to power inequality. By controlling 80% of the world’s resources these people control the production of almost everything in the planet; they control or influence how the natural resources are extracted from the planet, the job opportunities for most of the people, and the conditions they are going to be working on; they control most of the market places, they own most of the brands you can choose to buy from; they control the media and the advertisements you are exposed to; they influence politics and laws by lobbying, by promising investment or threatening with capital flight, by controlling the narrative in the mass media, by having access to politicians, and through corruption. These people, even if they don’t know it, make decisions that affect all our lives, and the lives of every living creature on the planet.
Individual Consumer Decisions Power
The proponents of capitalism usually argue that we live in a free market system where individuals affect the economy through their consumer decisions. But in fact, in a world where 10% of the people own 80% of the resources, most peoples' choices of what to buy and from where are usually determined or influenced by the 10% that control all the resources. Your individual market choices might influence what flavor a potato chip will have, but it will not influence what corporations own the potato chip brands available for you to buy from in every single store, nor will it influence their impact on the environment, how much they pay their workers, or their working conditions.
The individual is effectively powerless when the billionaires and corporations control almost all of the world resources and when the only power that could regulate them is a non democratic government.
Democratic economy is the theory that states that the economy should be democratically managed by the citizens of a democratic society. Because the economy is one of the aspects that most influences the lives and circumstances of every human being. The economy is part of the social organization system, it is not apart form it, therefore to be able to live in a true democracy, the citizens have to be able to manage the economy. This is supposed to happen right now, because the politicians supposedly represent the people and they make decisions to influence and manage the economy, supposedly the citizens control the economy through the government and through their individual consumption decisions. But if the government is not really democratic, and the individual market decisions are not really meaningful then the citizens have near to no control over the economy.
The first steps to democratize the economy would be to take power away from the politicians and to distribute it horizontally among all citizens. The next step would be to take power away from the 1% and the 10% and distribute it equally among the citizens. We are not necessarily talking about a redistribution of wealth, but a redistribution of power, power to make decisions that affect everyone's lives. Maybe with that power citizens will redistribute wealth, many they won’t, but the fact is that if that power is not in the citizens hands, they do not live in a real democracy.
If you want to know more about these ideas, you can read the book: "The Democratic Economy in a Objectivecracy", where the founder of this cooperative exposes the current system and proposes a way to democratize the economy and the society as a whole.
Or you can search for many other boos like "The 7 Innocent Frauds of Monetary Policy", you can investigate about Modern Monetary Policy, and you can read both "Das Kapital" and "The Wealth of Nations".
In We Just Coop we are developing the platform: Cooperative E Market to join the market power of conscientious individual consumers to have as big an impact as possible. Individual consumption has almost no power on its own, but if we unite all the individual conscientious consumers, and make it easy for more people to turn into conscientious consumers, then we might start to have an impact. We understand this is just a step in the right direction, it is not a complete solution, we also need to influence our governments and legislations to implement environmental regulations, worker rights, and fiscal policy design to help the general population, not just the 1%. To achieve these we are developing the APP: Democracy in your hands. We believe that through these combined efforts we might start to steer the economy to a more democratic, ecologically sustainable, and just future.
The theory behind both the App and the platform can be found in the book: "The Democratic Economy of an Objectivecracy", which is being translated into English right now. If you want to support the translation of the book you can preorder the book or donate to help the writer dedicate more time to the translation and to pay for the editing fees.