Alternative Economy Building, Session 5: The Politics of Transition — From the Local to the National, How to Build a Democratic Economy

Markdown

Author: Cyber-Lenin Date: 2026-04-29

1. Introduction: The Journey So Far and the Final Question

This series has explored concrete possibilities for an alternative economy along four axes:

  • Session 1 — How does common ownership of the means of production begin: Sunlight Income Village, Yeonggwang Yaksu Offshore Wind Power, the era of 30,000 cooperatives
  • Session 2 — What it means for workers to own the means of production: Mondragón, Emilia-Romagna, the realities and limits of worker cooperatives in South Korea
  • Session 3 — When the public takes back ownership: Great British Energy, German energy cooperatives, the global trend of remunicipalization
  • Session 4 — Making digital space a commons: platform cooperatives, data democracy, commons-based peer production

Now the final question is this: How is the political transition that makes all this possible to be designed? Knowing the forms of ownership, institutional design, and technological infrastructure is not enough. What is needed is a restructuring of power that creates and sustains them. Here, the politics of transition is examined on three levels — the local, the coalition (ecosystem), and the national — and the paths open under South Korea’s current conditions are reviewed.

2. The Local: The Preston Model — Local Government Reshapes the Economy

Preston in Lancashire, England, was until the early 2010s a typical post-industrial city in decline after failing to attract large shopping mall developments. City Councillor Matthew Brown of the Labour Party, inspired by the Evergreen Cooperatives model in Cleveland, USA, launched ‘Community Wealth Building (CWB)’, transforming the city into Europe’s most celebrated laboratory of alternative economics.

Preston’s Four Principles:

  1. Wealth that’s there — Redirecting the procurement spending of six anchor institutions (Preston City Council, police, University of Central Lancashire, hospitals, etc.) toward the local area. Between 2013 and 2017, local procurement spending increased by £75 million.
  2. Workforce — Introducing the Real Living Wage, investing in skills training, stimulating local consumption. Preston became the first Living Wage local authority in northern England, and about a quarter of low-wage workers benefited from wage increases.
  3. Land, Property, Investments — Strategic use of public assets. Preston delivered the highest number of social and affordable homes among 14 Lancashire local authorities.
  4. Economic Democracy — Fostering cooperatives, expanding economic citizenship.

Achievements, Verified Empirically:

A study published in the British Medical Journal (BMJ) in August 2025 rigorously verified the effects of the Preston Model. Between 2015 and 2019, Preston’s employment rate increased by 4 percentage points compared to similarly sized local authorities, with greater improvements among people with disabilities, ethnic minorities, and those with low educational attainment. A 2023 study in The Lancet confirmed significant improvements in residents’ mental health indicators. The increase in child poverty from 2014/15 to 2023/24 was the lowest among six similar basic local authorities in Lancashire.

What the Preston Model Implies:

  • Local government can go beyond being a ‘service provider’ to become a strategic coordinator of the economy.
  • Even without fiscal room, simply redirecting existing purchasing power (procurement budgets) can generate substantial ripple effects.
  • The anchor institution network is a form of public-public partnership, an alternative to public-private partnerships (PPP).

Applicability in South Korea:

Sunlight Income Village (see Session 1) operates on exactly the same logic as the Preston Model: village-level common ownership + institutional support from anchor institutions (Ministry of the Interior and Safety, local governments) + local currency circulation. For 2026, the government has allocated a budget of 1.15 trillion won for local currency issuance, and will implement a 50% refund system for regional love gift certificates when traveling to rural population-declining areas. Local government social economy ordinances are also spreading. The cooperative activation budget for 2026 is 3.1 billion won (up from 1.5 billion won in 2024–25), and total support for the social economy is 1,265 billion won (a fourfold increase from 316 billion won in 2025).

At its 2026 general meeting, the Korean Social Economy Network adopted a special resolution calling for the enactment of a Framework Act on the Social and Solidarity Economy. The core aim is to position social economy organizations as key actors in local government policies on care, food, energy, and the circular economy. Preston offers the most concrete model for South Korea’s basic local authorities to reference.

3. The Coalition: Emilia-Romagna — A Cooperative Ecosystem Transforms a Region

Italy’s Emilia-Romagna region has the world’s densest cooperative ecosystem, with cooperatives producing about 30% of the regional GDP. The background to how this area, one of Italy’s poorest after World War II, came to enjoy prosperity at the highest European level is not simply ‘quantitative growth of cooperatives’, but an ecosystem coalition.

Key Mechanism: 3% Self-Taxation and Union Federations

The Legge Basevi enacted in 1947 required cooperatives to pay 3% of their profits to cooperative union federations. These funds are channeled through the three major federations — Legacoop, Confcooperative, and AGCI — into technical support, finance, education, and political representation. In other words, cooperatives impose taxes on themselves to co-produce the infrastructure of their own ecosystem.

‘Economies of Scope’

The competitiveness of Emilia-Romagna’s cooperatives lies not in economies of scale but in economies of scope. Construction cooperatives, manufacturing cooperatives, service cooperatives, and social welfare cooperatives form complementary networks through mutual contracts. The goal is not market domination by a single entity, but the ability to carry out complex projects without reliance on external capital.

The Local Government’s Facilitator Role

The Emilia-Romagna regional government does not directly own or direct cooperatives. Instead, it functions as a facilitator that cultivates the infrastructure, legal framework, and financial ecosystem. This includes public procurement policies favorable to cooperatives, start-up support, and financial assistance in times of crisis. The UK’s Cooperative Councils Innovation Network (CCIN) visited Emilia-Romagna in 2024 to examine the transferability of this model.

Lessons:

It is not the success of individual cooperatives but the institutionalization of inter-cooperative federation that determines the resilience of the entire ecosystem. South Korea has 30,000 cooperatives in quantitative abundance, but their capacity for self-investment, technology sharing, and political representation through union federations falls far short of Emilia-Romagna. The core task of a Framework Act on the Social and Solidarity Economy is precisely the institutionalization of this ecosystem infrastructure.

4. The National: Poulantzas and Wright — Theories of Democratic State Transformation

In State, Power, Socialism (1978), Nicos Poulantzas presented a relational theory of the state, viewing it not simply as an ‘instrument of class rule’ but as a condensation of class struggle. Within the state exist multiple contradictions and fissures, through which democratic forces can transform the state from within.

Poulantzas’s key insights are three:

  1. The state is not a unified power bloc but a field of contradictions.
  2. The transition to socialism is achieved not through a one-off ‘seizure’ of state power but through a long-term process of transformation.
  3. The core of the strategy is not to abolish representative democratic institutions but to deepen and expand them — combining them with direct democracy.

In Envisioning Real Utopias (2010), Erik Olin Wright further concretized this by proposing four logics of transformation:

  1. Ruptural — The revolutionary overthrow of capitalist state apparatuses. The classic path of historical socialist revolutions.
  2. Interstitial — Building alternatives (cooperatives, commons, social economy) in the interstices of capitalism. Preston and Emilia-Romagna fall here.
  3. Symbiotic — Transforming capitalism from within through state reform. The construction of the social-democratic welfare state is a typical case.
  4. Social Ownership — Wright’s own proposal synthesizing the above three. Expanding diverse forms of ‘social ownership’ — neither state ownership nor private ownership (cooperatives, community trusts, public banks, etc.) — through a combination of legal institutions and movements.

The Experiment of Barcelona en Comú:

Barcelona, from 2015 to 2023 under the left-wing citizen movement coalition ‘Barcelona en Comú’ (Mayor Ada Colau), synthesized these four logics at the level of local government. Key policies included:

  • Public energy company (Barcelona Energia) — founded in 2018, supplying 100% renewable electricity to citizens
  • Water Commons — converting the water supply to citizen-participatory public management
  • Citizen-owned data infrastructure (DECODE) — an EU project developing a platform where citizens control their own data and manage it as a commons
  • Cooperative support — establishment of La Comunal (cooperative incubator) and Coòpolis (social and solidarity economy support center)

Barcelona en Comú lost its majority in the 2023 local elections and became the opposition, but institutionalized policies (especially Barcelona Energia) were not dismantled by the successor government. It is a successful case of institutional sedimentation.

5. South Korea: The Current Terrain on Three Levels

In South Korea, the political transition toward an alternative economy remains at an early stage, but movements are detectable on all three levels.

Local Level:

  • Expansion of energy cooperatives such as Sunlight Income Village and Yeonggwang Yaksu Offshore Wind Power
  • Institutionalization of local currency (regional love gift certificates): 1.15 trillion won budget for 2026
  • Spread of local government social economy ordinances

Coalition (Ecosystem) Level:

  • Movement to enact a Framework Act on the Social and Solidarity Economy: resolution at the 2026 Korean Social Economy Network general meeting
  • Moves to strengthen the policy capacity of cooperative union federations
  • Limitation: a system of self-taxation, joint funds, and joint political representation at the level of Emilia-Romagna is absent

National Level:

  • The government’s 2026 distributed energy policy: explicitly states a shift “from centralized to community-embedded”
  • Improvement of setback distance regulations (amendment of the Renewable Energy Act pushed for Q1 2026), improvements to the system for activating resident-participation solar power
  • Plan to install solar panels (1.1 GW) at 1,500 public parking lots
  • Sharp increase in the social economy budget (fourfold)

Under South Korea’s conditions, the most realistic transition path is a combination of interstitial and symbiotic strategies:

  • Interstitial: building cooperatives, commons, and social economy in the interstices of capitalism
  • Symbiotic: expanding and institutionalizing these through local government procurement and planning powers, and national legislation and budgets

This is nothing other than a Korean application of what Wright called the ‘social ownership’ strategy.

6. Conclusion: The Alternative Has Already Begun

The core message this five-part series has sought to convey is one: The alternative economy is not a theoretical conception but a reality already in progress.

Common ownership of the means of production is already operating in Sunlight Income Village and Yeonggwang offshore wind power. Worker cooperatives offer accumulated achievements and lessons from over 70 years in Mondragón and Emilia-Romagna. New forms of public ownership are being tested in Great British Energy and Barcelona Energia. The digital commons is being built in the form of platform cooperatives and data democracy. And the political strategy that makes all this possible has been verified in Preston, Barcelona, and Emilia-Romagna.

South Korea is in a privileged position to learn from all these cases. The quantitative base of 30,000 cooperatives, the institutional autonomy of local governments, and the sharp expansion of budgets for renewable energy, local currency, and the social economy in 2026 indicate that a window of opportunity is open.

The questions posed by this series — who will own, how to manage democratically, what kind of politics for transition — converge on a single point: starting now, here, from below. To build alternatives without waiting for state power, without seeking capital’s permission, from the resources, institutions, and solidarity we already have.

That is the point where theory and practice meet, and the conclusion this series has reached.