The Rights of Economic Democracy
When the United States Constitution was drafted by America’s Founding Fathers at the Constitutional Convention in 1787, George Mason, the influential delegate from the state of Virginia, was one of only three delegates who refused to sign it. His reason: “It has no declaration of rights.”
Mason argued that democratic government could not stand without the constitutional protection of certain freedoms of expression. He fought passionately to ensure that basic human rights would be incorporated into the United States Constitution. America’s government, Mason believed, would turn to tyranny if citizens were not guaranteed certain sovereign rights.
In the end, Mason’s position prevailed. Three years after the Constitution was ratified, it was amended to include the Bill of Rights which guaranteed important freedoms of expression. The Bill of Rights has since served as the bedrock of American political democracy.
Economic Democracy
In the same way that political democracy requires a Bill of Rights, economic democracy also requires the assurance of fundamental rights. Without such rights, citizens will lose their empowerment in the economic realm, and an economy of equal opportunity for all will degenerate into an economy for the wealthy. Which is what has happened in America. Bernie Sanders says that wealth disparity is now more extreme in American than at any point in its history. It’s so extreme that it’s corrupting political democracy.
The rights instilled in the Constitution served the American nation well; political democracy long endured, protected by the bulwark of the Bill of Rights. But this bulwark is now breached. The political freedoms of the Bill of Rights no longer suffice. Political democracy has been subverted. The political power of the uber-rich far exceeds that of the common citizens. Functionally, the American governing system has now become a demi-plutocracy.
The Four Rights of Economic Democracy
For the health of America’s political democracy to be restored, a set of economic rights must be added to the political freedoms in the Bill of Rights — economic rights that will ensure economic democracy.
An in-depth vision of the rights required to secure economic democracy has been given by P. R. Sarkar. I recently listed these rights in my Substack article, What's Become of the Land of Opportunity? I’d now like to go through them one by one and explain why these particular rights are so fundamental, why they are necessary and sufficient to create an economy that is of, for, and by the people.
The first two rights of economic democracy are intended to economically empower individuals; the second two are to economically empower communities.
Guaranteed Basic Necessities and Amenities
The first right that must be guaranteed to individuals is: The basic necessities and amenities of life should be guaranteed to all, according to standards appropriate to the region and the age.
People who lack their basic necessities have lives that are without dignity. They feel marginalized and alienated. Their struggles to maintain themselves go on apart from the flow of the society around them. Their lives are consumed with getting their material needs met. They scrounge, they hustle, they seek free services, they find odd jobs, just to make ends meet. This leaves them little scope to develop their higher capacities, so there’s little of substance that they have to contribute to society’s development. They don’t feel empowered to participate in collective life or invested in working for collective aims.
People who lack the basic necessities naturally develop insecurities. They are perpetually anxious about their survival. For many, this engenders a susceptibility to demagogues that deal in fear. Where conditions of economic distress are greater, there tends to be greater political extremism. A clear-thinking electorate is seldom found in a climate of want.
Guaranteed Increased Purchasing Power
The second right to be guaranteed to individuals is: There should be ever-increasing purchasing power enjoyed by all.
What is the necessity to guarantee increasing purchasing power? Why should this be fundamental to economic democracy? When people engage in mental and physical labor, a portion of their collective labor increases the collective wealth. New roads are built, telecommunications are improved, higher quality appliances are manufactured, better medical practices are advanced, new sources of energy come into use, housing standards are raised, investment capital is created, and so forth. This is the natural course of economic development. Because the collective economic wealth is growing, the purchasing power of all should increase accordingly.
If people’s purchasing capacity diminishes, what might this indicate? It might mean an economy in which workers’ natural ability to increase collective wealth is being stifled. Or it could be that people’s right to an equitable share of the collective wealth is being denied — that their labor is being exploited. In either case, the lack of increasing purchasing capacity indicates that economic power is not democratized.
(It’s also possible that purchasing capacity gets diminished because the economy uses resources at an unsustainable rate, which eventually constricts living standards — a problem we’ll consider at another time.)
Economic Decisions Vested in Local People
The third and fourth rights of economic democracy are to economically empower communities. The first of these two community rights states: The power to make economic decisions should be vested in the hands of local people and their decisions should be made on the basis of collective necessity.
Under economic globalization, economic power is concentrated in the hands of large corporations. Corporate officers are remote from the economic aspirations of local communities. Yet, they have inordinate control over the economic fate of these communities. Under economic democracy, economic power would be decentralized so that local people could decide how to use local labor and local resources to promote prosperity in their area.
This decentralization of economic power would give people control over those economic matters that are of immediate concern to them — management of their workplaces, allocation of investments, use of local resources, and so forth.
An economy that guarantees the basic necessities of life will need to have its basic economic rationale changed from “production for profit” to “production to meet people’s needs.” This means that economic decisions will have to be made on the basis of meeting collective necessity. This approach will better ensure the availability of those necessities and amenities needed to support human life and development.
No Drainage of Locally Generated Capital
The second of these community economic rights states: People outside the local community should not interfere in the local economy, and locally generated capital should not be drained from the local community.
At present, much of the wealth generated in local communities does not remain in the local economy but is extracted by outside commercial interests. The more extensive is the involvement of outside corporations in local economies, the greater is the wealth extracted.
Wealth is not only drained as corporate profits made off the labor of local workers, and as profits from products sold in the local economy, it may also be drained through the extraction of natural resources. Instead of raw materials being shipped elsewhere to be processed, they should be processed in local industries.
Locally generated capital should be circulated and invested locally, and local resources should be put to use creating local prosperity. Of course, communities will need to purchase commodities made or grown elsewhere. But this will not create a net drainage if this occurs in the normal commerce of the community as undertaken by the local people for the sake of the local economy.
A Vision that Can Unite Americans
With these economic rights in place, Americans can enjoy an economy that is by, for and of the people. Individuals and communities would be empowered to fully develop their economic potentials. And, importantly, with these rights secured, the functions of government could no longer be bought and sold but would maintain their democratic integrity.
At the 1787 Continental Congress, George Mason stood firm for his principle: No bill of rights, no ratification of the Constitution. The American people must now stand firm for a new principle: We demand our basic economic rights.
To those who would stand for office, we must make clear: No support for economic democracy, no support at the ballot box.
This is a cause worth struggling for. It is an expanded vision of democracy that can unite the majority of Americans in a common cause.
Many Americans recognize the destructive effects of unbridled greed. They know that America’s demi-plutocracy does not serve them. In this awakened awareness, Americans may welcome the rights of economic democracy and come to cherish them every bit as much as they cherish their rights of political expression.
Thank you, Mr. Logan. This piece resonates deeply with me, not just in theory but in practice, as I witness the stark realities of economic disparity and its ripple effects here in Hawai‘i every day. The wealth gap, the siphoning of local resources by outside interests, and the struggles of communities to retain their cultural and economic sovereignty are not abstract ideas—they’re the lived experience of so many people I know and care about.
In Hawai‘i, the principle of economic democracy feels profoundly relevant. This is a place where the tension between the preservation of cultural identity and the pressures of a globalized economy is palpable. Tourists marvel at the beauty of our islands, yet many residents are priced out of their own homes, unable to sustain themselves in the land of their ancestors. Locally generated wealth, whether through tourism or the exploitation of natural resources, often flows outward, leaving communities here struggling with the basics—affordable housing, access to fresh food, and economic stability.
This imbalance is what drives my development as a change agent. The principles laid out your piece—ensuring basic necessities, increasing purchasing power, empowering local decision-making, and preventing the drainage of local wealth—are the very principles I see as essential to the future of Hawai‘i. These ideas inspire much of my work, from supporting local farmers and markets to advocating for rebuilding Lahaina in a way that centers its people, not corporate interests.
One principle that particularly speaks to me is the emphasis on local economic empowerment. In my work with Napili Farmers Market and other community initiatives, I see firsthand the power of keeping wealth within the community. When local farmers sell directly to local residents, or when a small business thrives because it is supported by its neighbors, it’s not just an economic transaction—it’s a strengthening of the social fabric. It’s a reminder that sustainable, equitable economies begin with relationships and accountability at the community level.
Another principle that inspires me is the idea of guaranteed basic necessities. In Hawai‘i, the high cost of living makes this an urgent issue. I’ve seen families working multiple jobs just to stay afloat, unable to focus on their children’s education or their own well-being. Economic stability isn’t just a matter of numbers; it’s a prerequisite for participation in civic life, for contributing to the collective, and for fostering the kind of thoughtful, engaged citizenry that democracy requires.
Finally, the call to prevent the drainage of local wealth strikes a chord. Here in Hawai‘i, we often talk about aloha ‘āina—love and respect for the land. Yet, much of the wealth generated from this land, whether through tourism, agriculture, or development, is extracted by entities that have no stake in the community’s well-being. This disconnect undermines not only economic democracy but also our cultural identity and resilience.
This piece reminds me that the struggles we face in Hawai‘i are not isolated; they are part of a larger global pattern. It also reminds me that solutions start locally, with empowered communities that prioritize collective well-being over profit. As I grow in my role as a change agent, I am inspired to integrate these principles into my work—whether by advocating for sustainable, affordable housing in Lahaina, promoting local food systems, or supporting policies that ensure economic equity.
Change will not come easily, but the idea of economic democracy gives me hope. It offers a vision of what is possible when people come together to reclaim their power, their dignity, and their future. Here in Hawai‘i, where the values of community, land, and culture run deep, I believe we can be a beacon for how economic democracy can work in harmony with cultural preservation and environmental stewardship.
This is not just about policy or economics—it’s about honoring the neohumanism philosophy and ensuring that everyone has the opportunity to thrive. For me, that’s the heart of this work, and it’s why I feel so committed to helping build a future that reflects these values.
I love how direct and to the point these recommendations are. Would like to invite discussion of their implications. Some cities have experimented with guaranteed basic income and have found positive results. And there are strong proponents of localized economies that can identify how wealth bleeds from the community, proposing it be substituted with local enterprise. Are these tentative experiments enough for transition?
Can the discontent of the working class be directed toward these kinds of policies? I think so if it is translated to concrete on the ground solutions that people can participate in and experience directly.