11.11.07
Voltairine de Cleyre, Anarcho-Capitalist?
[cross-posted at Liberty & Power]
William Gillis is putting together a left-oriented (he doesn’t like the term “left” but I can’t think of a better short way to describe it) series of market anarchist pamphlets in PDF form, reprinting various “historical articles from our tradition that highlight our relation to the revolutionary left and explain Market Anarchist theory in general terms.” There’s one in there by me – and how my piece got in there with classics by Murray Rothbard and Voltairine de Cleyre beats me, but I’m not complaining! Check out the first five.
The de Cleyre piece – co-authored with one “Rosa Slobodinsky,” who, according to Shawn Wilbur, was actually Rachelle Slobodinsky Yarros, wife of Victor Yarros – may be especially controversial. It was written while de Cleyre and Slobodinsky were still in their individualist anarchist phase, and represents a defense of individualist anarchism against the anarcho-communist alternative. (De Cleyre later repudiated individualist anarchism, though without embracing the communist version either; instead she came to favour a more pluralistic vision of anarchism where different economic arrangements, whether individualistic or communistic, would coexist. I’m happy to call that view individualist anarchism even if she wasn’t. Slobodinsky’s later “apostasy” was more serious; she seems to have agreed with her husband in renouncing anarchism entirely, or so at least I infer from this write-up, which portrays her as a self-described “half apologetic pragmatist” who “admired the Soviet Union.” Ah well.)
The “especially controversial” part comes in the individualists’ willingness to use the term “capitalistic” to describe their system. As I’ve discussed before, anarcho-socialists tend to go ballistic when anarcho-capitalists claim the legacy of individualist anarchists like de Cleyre. (See for example this review – whose author incidentally appears to think that Crispin Sartwell is an anarcho-capitalist!) Yet to the charge, on the part of anarcho-communists, that individualist anarchism amounts to a form of capitalism, de Cleyre and Slobodinsky reply:
Capitalistic Anarchism? Oh, yes, if you choose to call it so. Names are indifferent to me; I am not afraid of bugaboos. Let it be so, then, capitalistic Anarchism.
I can predict the likely reactions from both sides. Anarcho-capitalists will say: “See, de Cleyre was a defender of capitalism after all! So much for those lefty anarchists who told us that the hem of the individualist anarchist tradition was too purely anti-capitalist for us benighted capitalists to touch. Now we have the individualist anarchists’ own word for it that they were happy to be called capitalist anarchists!” And anarcho-socialists will respond: “De Cleyre and Slobodinsky are clearly using the term tongue in cheek! They’re responding to a smear by insisting on talking about substance rather than labels. They’re not really endorsing capitalism the way you pseudo-anarchists do.”
Let me try to say something to moderate both reactions. What the 19th-century individualist anarchists advocated under the name of a “free market” has both similarities with and differences from what the mainstream of 20th-century anarcho-capitalists have advocated under that name. Anarcho-capitalists tend to stress the similarities and ignore the differences; anarcho-socialists tend to stress the differences and ignore the similarities. It would be a mistake on the part of anarcho-capitalists to seize on de Cleyre’s and Slobodinsky’s use of the term “capitalistic Anarchism” to elide the genuine differences that exist between the two traditions. But by the same token, it is a mistake for anarcho-socialists to seize on anarcho-capitalists’ use of the term “capitalism” as though it implied agreement with existing corporatist capitalism.
Too often anarcho-socialists have treated anarcho-capitalists’ mere willingness to use the term “capitalism” as though this terminological choice by itself committed anarcho-capitalists to all sorts of awful things incompatible with the anarchist tradition – and this passage from de Cleyre and Slobidinsky is a useful corrective to that tendency. Anarcho-capitalists likewise tend to downplay, while anarcho-socialists tend to exaggerate, the extent to which the individualist anarchists called themselves “socialists” – as though the choice of terminology were the crucial one. (Tucker, for example, tended to use the term “socialism” favourably in his early writings and pejoratively in his later ones; anarcho-capitalists rarely quote the earlier usage and anarcho-socialists rarely quote the later. I myself have pretty much given up using either “socialism” or “capitalism” to mean anything at all, for reasons I explain here.)
And along with the terminological blinkers come substantive blinkers. You’d never guess, from reading some of the anarcho-capitalists’ attempts to claim the mantle of the individualist anarchists, that most of those individualist anarchists saw the anarchist cause as inextricably bound up with “socialist” causes like worker empowerment and the abolition of the wage system – causes that many anarcho-capitalists in vulgar-libbin’ mode regard as anathema. But then you’d likewise never guess from reading anarcho-socialist critiques of anarcho-capitalism that there have nevertheless been self-described anarcho-capitalists, and prominent ones, who themselves favoured worker empowerment and the abolition of the wage system. All these details call for studying similarities and differences carefully and using the sledgehammer sparingly.
So, how significant is it that a figure like Voltairine de Cleyre was willing to call her position “capitalist”? I say: less than some anarcho-capitalists may be tempted to claim, yet more than some anarcho-socialists may care to admit.
Dain said,
November 11, 2007 at 2:31 pm
“Is it justice to take from talent to reward incompetency? Is it justice to virtually say that the tool is not to the toiler, nor the product to the producer, but to others? Is it justice to rob toil of incentive? The justice you seek lies not in such injustice, where material equality could only be attained at the dead level of mediocrity.”
Apparently this individualist anarchist hasn’t grappled with Rawls. Obviously.
This kind of rhetoric may have seemed self evidently valid in the 19th century, among socialists as well as the bourgeois, but today it would be a dead giveaway that the person speaking is a conservative. “Incompetence”, “Mediocrity”, “Incentive”. If revulsion is the common reaction to notions such as those in the quote above - even if the revolted are being hypocritical as they apply this kind of “bourgeois” attitude to their personal lives - the individualist/market anarchist will lose hearts and minds.
paxx:blog » Blog Archive » Anarcho-”Kapitalismus” vs. Anarcho-”Sozialismus”? said,
November 11, 2007 at 4:56 pm
[…] Ohne grossen Kommentar verweise ich mal wieder auf einen Blogbeitrag von Roderick Long: “ Voltairine de Cleyre, Anarcho-Capitalist?” […]
Administrator said,
November 11, 2007 at 7:42 pm
Dain — in terms of doctrine (as opposed to rhetorical tone), what in that passage is incompatible with Rawls?
Rich Paul said,
November 11, 2007 at 8:05 pm
I’ve never found a good answer to this:
If “anarcho-socialists” want to have no government, but want to prevent free trade from occurring, how are they going to prevent it? They say they want to abolish the wage system … but what are they going to do, if I believe my best option at some particular point in my life is to work and let somebody else supply the tools? Will they kill me? Will they kill him? Will they imprison us both? Where? Do you intend to have prisons for people who attempt to produce for themselves in your “anarchy? Or will you just steal the fruits of our labor? And if so, what separates disorganized thieves from the organized thieves at the IRS?
I’m really curious about this. Socialism is about taking power from individuals and giving it to central planners, who then use force, instead of persuasion and reward, to get the individual to follow their edicts. How can any of this be done without a government? The only thing I can envision, which would be akin to socialism but without a government, is massive mob violence against anyone who seems to have an above average ability or willingness to produce.
Miguel Madeira said,
November 11, 2007 at 8:41 pm
“They say they want to abolish the wage system … but what are they going to do, if I believe my best option at some particular point in my life is to work and let somebody else supply the tools? Will they kill me? Will they kill him? Will they imprison us both? Where? Do you intend to have prisons for people who attempt to produce for themselves in your “anarchy? Or will you just steal the fruits of our labor?”
This was already explained in all anarcho-socialist texts: in anarcho-socialism, propert rights of tools owned by a person different from the person who works with the tools are not enforced, i.e., you, as a worker, have the right of “expropriate” these tools from your boss (probably, these fall in the category “Or will you just steal the fruits of our labor?”).
“And if so, what separates disorganized thieves from the organized thieves at the IRS?”
The “disorganized”?
Brad Spangler said,
November 11, 2007 at 9:41 pm
A few things…
I strongly recommend avoiding the term “anarcho-socialist”. To the people you
Brad Spangler said,
November 11, 2007 at 9:49 pm
[continued]
…are attempting to describe, the term typically sounds odd and generally paints you as uninformed in their view. Nobody describes *themself* as an “anarcho-socialist”. Rather, they tend to view the terms “libertarian socialist” and “anarchist” as largely overlapping if not quite completely synonymous (opinions vary), although not all libertarian socialists are anarchists and there are other exceptions in both cases.
Look, if you insisted on describing automobiles as “wheelo-transporter devices”, people are going to wonder what f***in planet you just dropped in from, and they’d have a point.
Brad Spangler said,
November 11, 2007 at 10:06 pm
[continued]
Secondly, if Tuckerite mutualism is both “libertarian socialism” AND “free-market libertarianism”, then at the very least we have to face the prospect that it’s perfectly legitimate to view Rothbardian market anarchist as “socialism” as well.
Anarcho-”capitalism”, as an ideology, IS socialism because it answers the social question.
Anarcho-capitalism, as a movement, IS NOT socialism because it is reformist rather than revolutionary and the anarcho-capitalist thus behaves politically as a de facto classical liberal.
Yet Rothbard’s contributions to individualist anarchist theory are perfectly legitimate ideas about the nature of a stateless society, and they have astonishingly “anti-capitalist” (anti-”statist monopoly of capital”) implications.
You can’t credibly say “Tuckerite mutualism is libertarian socialism” while “Rothbardian market anarchism is Capitalism”, and thereby imply that they are worlds apart on the political spectrum when the principal differences are fundamentally rather negligible.
Those fundamental differences are:
1) Usufruct property theory versus Rothbardian property theory.
2) Labor theory of value versus subjective theory of value.
Both usufruct and Rothbardian property theory are variations on the theme of labor made property as a natural moral phenomenon standing in contrast to fraudulent state awards of property title.
The labor theory of value came into socialism from “capitalist” economists. Why can’t the subjective theory of value do the same?
If Tuckerite mutualist anarchism is libertarian socialism, then so is so-called “anarcho-capitalism”. The fundamentals are to similar. Both posit that the stateless free market answers “the social question”.
Mike Erwin said,
November 11, 2007 at 10:09 pm
The phrase “abolition of the wage system” has not always historically been understood as “abolition of wages.”
e.g. Chaplin, “General Strike for Industrial Freedom:”
“The ultimate aim of the General Strike as regards wages is to give each producer the full product of his labor. The demand for better wages becomes revolutionary only when it is coupled with the demand that the exploitation of labor must cease…”
Brad Spangler said,
November 11, 2007 at 10:19 pm
[continued]
Re: Victor Yarros — Every anti-establishment movement has its sellouts and lamers. There is virtually nothing new under the sun. Dana Rohrabacher, Alan Greenspan, etc.
Rich Paul said,
November 11, 2007 at 11:38 pm
Hmmm … small problem.
When I create wealth, it is always with the intent, sooner or later, of consuming. There is no point in production without consumption. So if I put some of the wealth I created aside, in order to procure tools, machines, buildings, or other needful things to increase my production, I do so because I believe it will increase my ability to consume at some later point in time. If, however, anybody who wants to can just come along and confiscate my productive assets, or capital, then I have no reason to create capital. And without capital, we would all be subsistence farmers, trying to scratch a living from the earth with digging sticks.
Sorry, the government is impoverishing me just fine … there would be no point in going to all the trouble of abolishing government if in the same stroke, I would be abolishing my ability to maintain a standard of living which allows me to enjoy my newfound freedom.
Dain said,
November 12, 2007 at 12:15 am
Well I meant Rawls’ idea that people don’t have a right to utilize their inborn talent without intervention to compel them to “share”. I’m not sure if his difference principle overrides this idea, however. I’m far from a scholar on the guy.
A better quote in the pamphlet to cite for my point about Rawls would have been this:
COMM: “When I see that you are enjoying things which I cannot hope to get, what think you will be my feelings toward you? Shall I not envy you, as the poor do the rich today.”
INDV: “Why, will you hate a man because he has finer eyes or better health than you? Do you want to demolish a person’s manuscript because he excels you in penmanship?”
Rich Paul said,
November 12, 2007 at 12:18 am
Actually, there is one thing I’m unclear on which might mitigate my earlier words. It is said that “the society” would not enforce contracts for labor. The question is, when my former helper showed up to confiscate my tools and equipment, and reduce me to beggary, would there be an organized force to prevent me from protecting myself against him? Would there be an organization with special power to force me to submit, or would it just be a matter of whether I or my former employee were quicker with a gun?
One of they annoying things about a state, is that when the enslave of impoverish you, they expect you not to resist. I suppose I could tolerate a society in which there was no help in resisting, so long as it was not so organized as to make self-defense impossible.
Administrator said,
November 12, 2007 at 1:13 am
Brad,
Nobody describes *themself* as an “anarcho-socialist”.
Well, that’s true, but that’s because most anarcho-socialists don’t recognise anarcho-capitalists as genuine anarchists, so they would think “anarcho-socialist” redundant.
Analogously, most trinitarian Christians wouldn’t call themselves “trinitarian Christians” because they’d think the adjective superfluous, since they don’t regard non-trinitarian Christians as genuine Christians.
william said,
November 12, 2007 at 4:09 am
Roderick,
Despite whatever you may hear on the FAQ, the majority of “social” Anarchists I know are actually quite distanced from the term “socialism” and WOULDN’T self-apply it or even really consider it redundant.
It’s cliche and not entirely true, but the movement today at least sees itself as split evenly between Red and Green Anarchists. Most Reds would consider anarchism and “socialism” redundant, most Greens never use it and would be a little weirded out to hear it applied to them.
In practice the great Red/Green split isn’t anywhere as neat as everyone makes it out to be. Between the hugely varying schools, cultures and tendencies that make up the Anarchist Social Movement (my polite way of saying “non ancaps” since the ancaps while sometimes connected to Anarchism in Theory and Discourse, are clearly not a part of the actual Anarchist *Movement* and don’t even have their own *Movement*) I’d say about 35% would freely associate with the term “socialist.” And that’s looking at the movement globally, which tends to favor Syndicalism outside the Anglosphere and Eastern Europe. In America I’d say that percentage would be far lower. Insurrectionary Anarchism, Post-Leftism, Green Anarchism, Anarcha-Feminism, Post-Anarchism, Anarcho-Primitivism, Classical Individualist Anarchism, and the general feeling of Anarchism-Without-Adjectives… “Anarcho-Socialist” beyond sounding really strange and an indicator that the speaker has no idea what he’s talking about, would generally be taken derogatorily.
william said,
November 12, 2007 at 4:31 am
-”If “anarcho-socialists” want to have no government, but want to prevent free trade from occurring, how are they going to prevent it?”
We don’t.
Free association is the foundation of ALL schools of Anarchism.
The critique of “trade” is two fold:
1) That the current opportunities for “trade” are coercive or framed within coercive conditions. So we need to abolish those coercive conditions (ie equalize wealth so that everyone can start over).
2) That “trade” in its present form has a psychological underpinning that is corruptive and destructive. Leading to commodification, greed and other things that will make a culture of liberty impossible.
-”They say they want to abolish the wage system … but what are they going to do, if I believe my best option at some particular point in my life is to work and let somebody else supply the tools?”
They want to create a world where you will never feel forced into a situation where you HAVE to take orders in order to survive because there are no other options. They would create other options in the form of cooperatives, unions, communes and collectives. If you want to hire your friend to roof your house or have someone apprentice under you, that’s perfectly acceptable.
-”Will they kill me? Will they kill him? Will they imprison us both?”
Oh, yes. Obviously.
-”Where?”
Siberia, Comrade.
-”Do you intend to have prisons for people who attempt to produce for themselves in your “anarchy?”"
Hell no. Hermits and individualist producers are and have always been encouraged by even the most extreme of Anarcho-communists. They just figure that most people will want to join a coop and that working together as equals will be preferable to the vast majority.
-”Or will you just steal the fruits of our labor?”
I might nip a couple french fries off your plate when you’re not looking.
-”And if so, what separates disorganized thieves from the organized thieves at the IRS?”
We wear ratty clothes. Duh.
-”I’m really curious about this. Socialism is about taking power from individuals and giving it to central planners, who then use force, instead of persuasion and reward, to get the individual to follow their edicts.”
I may throw such accusations at my friends when I’m feeling like being a dick, but NO ANARCHIST ACTUALLY SUBSCRIBES TO THAT. If they call themselves “socialist” they mean it in the sense that being social and working together with others is a good thing, and that we should look out for the common welfare.
NO ANARCHIST HAS EVER WANTED CENTRAL PLANNERS.
-”How can any of this be done without a government? The only thing I can envision, which would be akin to socialism but without a government, is massive mob violence against anyone who seems to have an above average ability or willingness to produce.”
Oh, yeah! Lynch mobs!
william said,
November 12, 2007 at 4:52 am
“The question is, when my former helper showed up to confiscate my tools and equipment, and reduce me to beggary…”
Wouldn’t happen. I know of no Anarchist–no matter how many punk rock patches they may wear–who would ever be down with that.
If you’re a CEO and you “have” a dozen factories under Corporate State Capitalism, they’d turn the factories over to the workers and on-the-floor administrators who ran them. If you tried to continue ordering about the workers or imposing your will on the factories, there’d probably be some collective force applied to evict you and your cops.
If you’re a boss of a small business then they’d try to talk to you and work out some new form of more equal and fair workplace democracy. People from the rest of the community would mediate.
A man who truly did build his business with the sweat of his brow alone and didn’t benefit at all (or even significantly) from the unfair conditions of State Capitalism would almost certainly be left alone. In the instances where Anarchism has taken root this has almost always been the case.
But if you insisted on imposing working conditions that were generally considered unfair you’d find yourself a dinosaur unable to network with anyone else. The other communes and coops wouldn’t really be interested and workers would expect to get far more equal wages to your own.
The real issue at hand is that few Anarchists think the current wages being paid workers are fair. That those with money and power have colluded together to create a general atmosphere of coercion and control that has impeded those born in want for centuries.
If you worked at a mill for a decade and barely made enough to eat, while the owner had caviar then the Anarchists see something seriously wrong with this and would claim that you are owed serious BACK PAYMENTS. And while you could obtain these by making off with one of the owner’s limos, they feel it would be far more productive and a far better investment to make off with the entire factory you’ve been slaving in with your fellow workers.
The owner’s not going to be reduced to starvation (like you were) but neither is he going to be allowed to retain all the things he got away with stealing when the cops were in his pocket.
Brad Spangler said,
November 12, 2007 at 5:45 am
@Roderick,
Regarding: “…but that’s because most anarcho-socialists don’t recognise anarcho-capitalists as genuine anarchists”
I assumed you were aware that this is old news to me. I’ve been on the anarcho-”capitalist” end of the debate and I’m still fundamentally a Rothbardian. My contention is NOT that anarcho-capitalism is not anarchism, but that anarcho-capitalism is incorrectly named.
Look, the “capitalistic” anarchism de Cleyre was talking about is the Tuckerite doctrine — mutualism. If mutualism is “libertarian socialism”, then so is Rothbardian market anarchism.
Look, ususfruct and LTV are not themselves enough, IMO, to create a gulf between what is essentially versions 1.0 and 2.0 of the same ideas (Tucker > Rothbard). Usufruct and LTV don’t themselves alone make mutualism “libertarian socialism”. Rather, 100% “free land, free money and free competition” do because as a package they answer the social question. Yet Rothbardian market anarchism, despite its differences with the Tucker doctrine, SHARES variations on that “Holy Trinity” (as it is referenced in the de Cleyre / Slobodinsky article).
Free Land? Rothbardian property theory, check!
Free money? Rothbard was an ardent proponent of free banking. Check!
Free competition? Rothbard, as you know, favored 100% free competition in all industries, most notably the provision of law and security. Check!
Rothbard was a socialist for the same reasons Tucker was a socialist.
Furthermore, there’s EVEN somewhat of a precedent for considering Rothbard (and hard-core Rothbardians) “socialist” in the sense that “anarchism is libertarian socialism”. Stirner is typically recognized as an anarchist despite having been critical of anarchists in his day and not calling himslef one.
Gene Callahan said,
November 12, 2007 at 7:11 am
“Rothbard was an ardent proponent of free banking.”
In that he equated it with fraud?
Brad Spangler said,
November 12, 2007 at 8:29 am
re: “”How can any of this be done without a government?”
It can’t, and that’s a good thing. There are other definitions of “socialism”.
Socialism without government, i.e. “libertarian socialism”?
Yes, it’s called “civil society” and it’s a social agenda rather than a political agenda. If you’re a free-market libertarian you’re already in favor of it, you just aren’t accustomed to thinking of it as “socialism”.
As Proudhon noted, the social revolution is undermined if it comes through a political revolution.
This has nothing to do with the Misesean definition of “socialism”. You don’t have to accept the Misesean definition of “socialism” in order to make use of Mises fundamental economic insights.
Brad Spangler said,
November 12, 2007 at 8:39 am
@Gene
Rothbard favored a 100% free market in banking.
Brad Spangler said,
November 12, 2007 at 8:53 am
Rothbard’s opinion as a professional economist, namely that he saw mutualist banking as inflationary, can and ought to be considered distinct from his “political” thought (i.e. the circumstances when use of force is or isn’t justified).
“But my main quarrel with the Spooner-Tucker doctrine is not. political but economic…”
Administrator said,
November 12, 2007 at 12:00 pm
To Brad: yes, but Rothbard also thought (wrongly in my view) that fractional-reserve banking was a rights-violation, a form of fraud, even if the customers were fully informed. It wasn’t just an economic view.
To Gene: but I don’t think “free banking” necessarily implies fractional-reserve banking (some Rothbardians, for example, talk about ‘100% reserve free banking’), so I don’t think it’s false to call Rothbard a proponent of free banking.
To everybody: more replies to come, I promise!
Brad Spangler said,
November 12, 2007 at 2:51 pm
Roderick,
I happen to share your disagreement with Rothbard about fractional reserve banking in a free market being, in and of itself, fraud — that is, provided that the banker doesn’t present themselves as anything other than a fractional reserve bank.
However…
A labor backed currency wouldn’t be fractional reserve banking if it was 100% backed by actual labor contracts sufficient to cover all labor notes issued.
Rothbard’s sole mention of “fraud” in his essay on the Spooner-Tucker doctrine was in reference to any currency not backed by gold or silver IF it calls itself a “dollar”. Clearly, the Ithaca Hour, for example, doesn’t fit this standard of fraud either.
Now, my thoughts on “mutual banking” vary depending on what exactly one means by the term. I happen to like credit unions. I’m not particularly convinced that a labor backed currency would be a good business model for a currency issuer, with gold being the clear favorite in my opinion. But all those personal opinions have nothing to do with my political opinion on whether or not mutual banking is compatible with the legal code of a stateless free market society. Clearly it is, unless a particular scheme has some criminal aspect.
That’s the market for you. Diverse preferences are largely accomodated, to the extent it is economically feasible. You don’t have to understand or like it. Personally, I’ve always found the ongoing popularity of the Chia Pet(tm) rather disturbing.
John said,
November 12, 2007 at 6:09 pm
Smash Zaxlebax!
Rich Paul said,
November 12, 2007 at 7:43 pm
There was a specific practice in banking which Rothbard considered fraudulent. This is fractional reserve banking.
If you own a grain elevator, and store grain for others, and issue warehouse receipts, you are in a business very similar to banking. You are in the business of storing something of value, and providing access to the owners when the time comes. Your warehouse receipts, if they are “bearer” receipts, and can be redeemed by anyone who uses them, are equivalent to paper money. Your customers are not guaranteed that they will receive the same grain which they deposited when they come to collect, but they are guaranteed to be able to collect equivalent grain upon demand.
All of this is good. You are in an honest business, have a good reputation, and making money. But what happens if you decide that since your receipts are traded as if they were the commodity itself, and since you always have some inventory stored (and matching outstanding receipts), you can print up some fake receipts and sell them yourself? At this point, you have committed embezzlement or fraud, depending on the details.
What are the economic effects of your fraud? Your fake receipts create ‘phantom grain’, which does not really exist. This depresses the price of the grain, because the apparent supply is no longer equal to the actual supply … but the market price is determined by the intersection of the apparent supply curve and the apparent demand curve … since nobody is aware of what the actual curves are. At some point, if you do this enough, somebody will come to cash a receipt when there is no grain in your elevator. That person, when frustrated in his attempt to collect his property, will alert probably alert the police. Your other customers will rush to try to get their grain back, or as much of it as actually exists. Potential customers will choose to take their business to somebody honest, and thus you will have little inflow of grain to ‘make good’ your embezzlement. At this point, the price of grain will revert to it’s normal price, as consumers and investors learn the real conditions of the grain market.
This has actually happened in America, and the operators of the grain elevators were considered to have committed criminal acts.
This is exactly equivalent to fractional reserve banking, except that bankers have been granted the legal privilege to commit this fraud with impunity. The effects on the price of money are identical. But when the commodity in question is that commodity which a society has chosen to use as money, whether it is gold or fiat scrap paper, the effects can be disastrous. This is why there was a business cycle even before the Federal Reserve came along, and made our entire money system fraudulent.
When the value of money is depressed by an apparent increase in supply, the economy goes into a “boom” condition, as lots of people invest in things that they would know were unprofitable if they knew the true state of the money supply. As they do this, people make money, wages rise, and asset prices rise, and everything looks prosperous. But the prosperity is illusory, and eventually there are bank runs. At this point, the banks have to curtail their new lending activity, in order to try to become liquid, and they also find themselves making many loans to each other. The apparent money supply of the society contracts. Prices drop, wages drop, businesses which invested badly cease to exist, and production is rearranged into a condition which matches reality. This is a painful, but needed, process. It was called a depression until the Great Depression, and after that they started calling it a recession.
Of course the Great Depression was caused by the Federal Reserve, which did pretty much the same thing on a huge scale. This gave us both the roaring twenties and the Depression. Other examples of the Federal Reserve’s mischief include the “dot.com” boom and bust, the housing boom and bust, and the fact that people no longer save money, since the rate of interest so rarely exceeds the actual (not the government reported) rate of inflation.
Karl Marx said that if you want to destroy a capitalist economy, you must debauch their currency. In America, he is getting his wish, and all the misery which accompanies it, in spades. If productivity were still what it was in his day, with these insane policies in effect, there would be actual famine. Luckily, capitalism has advanced toward a level of productivity which allows almost universal prosperity, in spite of government interventions into the market.
Rich Paul said,
November 12, 2007 at 7:49 pm
I would suggest using another word. If your system is not based on Marx’s ignorance and brutality, the unfettered slavery of all to all, and the complete destruction of the individual, you might not want to call it by the name of a system which is.
Rich Paul said,
November 12, 2007 at 7:56 pm
There is nothing in the capitalist philosophy which requires a monopoly of anything by anybody, except that each individual has an inalienable “monopoly” on the use of his own body and people have an alienable “monopoly” on the use of their other property. The right to property follows from the right to self ownership … if you cannot claim the fruits of your labor, you are not free.
There are only two requirements to implement a capitalist system:
Private Property
Free Trade
As for the labor theory of value, it is simply wrong. If I am a bad craftsmen, I can take perfectly good flour, and shortening, and apples, and sugar, and make a completely inedible pie. But the value of the ingredients have been “increased” by one hour of labor. This is no consolation to anybody who actually has to eat my worthless pie.
Rich Paul said,
November 12, 2007 at 8:18 pm
The current distribution of wealth in America, and probably even more so in Europe, is certainly more related to political power than to productive ability. I personally don’t care, so long as the government crippled market which allowed these conditions to develop is put out of it’s misery, so that the incompetents will lose their money and the competent will make money. Fix the market, and wealth will redistribute itself.
Working together with others is a fine thing. Socialism, however, implies being forced by violence or the threat of violence to work together with your slave-masters. These are rather different things.
But what happens if, under the ensuing “anarchy”, if somebody is more successful than somebody else. It may well be that Joe is extremely good at what he does, and that he is able to offer more money to his employees than they are able to make on their own. This, of course, only holds if he is actually able to make his own decisions. If he is forced to let his employees decide how they will use his property to make money, then their incomes will be limited to what they are able to produce. If that is what they want, of course, there is nothing to stop them from going into business themselves. But many people are not interested in doing the work, and taking the risks, associated with entrepreneurship.
If you add up all the union dues collected by General Motors employees, and image that each month, rather than spending the money on leg breakers or sending it to the Mafia or their spiritual brothers in government, they had spent the money on General Motors stock, and that they had reinvested the dividends from that stock in buying more stock, they would own General Motors several times over. Why did they not do this? Because they were incapable of running General Motors, and either
(a) they knew they were incapable
(b) they didn’t know it was possible to buy the company, which would rather prove my belief that they were incapable of running it.
Their ain’t no such thing as a free lunch. If you depend for your survival on plundering the productive, there will eventually remain nobody who is productive to plunder.
Brad Spangler said,
November 12, 2007 at 9:28 pm
@Rich,
Regarding “the capitalist philosophy”. There is no singular “the” applicable in such matters when the word “capitalism” has multiple operative definitions. If that doesn’t make any sense to you, ask a few questions before presuming to lecture me on stuff I was explaining to people over a decade ago.
william said,
November 12, 2007 at 11:46 pm
“Socialism, however, implies being forced by violence or the threat of violence to work together with your slave-masters.”
While it may personally imply that TO YOU, it actually means no such thing. There are still old definitions where it just means WORKING TOGETHER WITHOUT COERCION.
Why the hell do you get the right to impose your definition on the different one they’re using?
“Fix the market, and wealth will redistribute itself.”
The starving need food today. Those who have been fucked over badly by the state/capitalism need recompense.
“If you depend for your survival on plundering the productive, there will eventually remain nobody who is productive to plunder.”
You presume that even a minority of people today who have wealth and would get that wealth stolen, have it because they are more productive. This is just ridiculously laughable. The smartest people I’ve ever known were well below poverty line, they became smart because they had to be in order to stay alive. But they never, ever, ever made it out of poverty, the costs were just too high. My time with the rich or middle-class has been infuriating because they’re dumb as sheep.
“…they had spent the money on General Motors stock, and that they had reinvested the dividends from that stock in buying more stock, they would own General Motors several times over. Why did they not do this?”
Because they were too busy trying to get by?
“Their ain’t no such thing as a free lunch.”
Actually there is. Of a sort. Read up on Gift Economies.
“It may well be that Joe is extremely good at what he does, and that he is able to offer more money to his employees than they are able to make on their own. This, of course, only holds if he is actually able to make his own decisions.”
So then they’d let him make those alone. Duh. Free association.
“If he is forced to let his employees decide how they will use his property to make money, then their incomes will be limited to what they are able to produce.”
Why would they force him to accept their decisions? Rather they’d just VOLUNTARILY leave certain tasks to those best suited to deal with them. But they’d be pretty pissed if he kept such skill as an absolute secret to himself. Because he’d be monopolizing and conspiring against them to keep his power.
“But many people are not interested in doing the work, and taking the risks, associated with entrepreneurship.”
Many people are UNABLE to take the risks. And few entrepreneurs are willing to do the work that many if not most of the workingclass and those in poverty take upon themselves just to survive.
To clarify for you this ridiculous fear. No Anarcho-Communist (the most red of Red Anarchists) would ever have a problem with someone striking it out and being individually more successful if that success was not dependent upon anyone else’s subjugation.
They just can’t really imagine any one person ending up being radically more successful than any other person in a free world.
Social Anarchists are mostly worried about passive forms of social and psychological domination. They won’t use coercion to fight a person they feel is trying to non-coercively get a leg up over others in bad faith. They just would want to talk to him and work things out. Usually using free association to “punish” him.
Kevin Carson said,
November 13, 2007 at 1:30 am
Gene Callahan,
I think Rothbard mistakenly classified the Greene-Tucker model of mutual banking as a system based on fiat money and currency inflation. In fact, the central point of Greene’s and Tucker’s analysis of capitalist banking was exactly the same as Rothbard’s analysis of the effect of legally mandated capitalization requirements for life insurance. In both cases, the state requires capitalization at levels far higher than required by risk considerations alone, and thereby raises entry barriers and reduces the number of firms competing to supply life insurance–or credit. So it’s odd that he missed Tucker’s point, when he himself was making the very same point in a different context.
Rich,
You resurrect a version of the old “mud pie” canard as proof that the labor theory of value is “false.” Apparently you are unaware that Marx *invented* that argument, in the context of his debates with Proudhon. It has no bearing whatsoever on what the proponents of the labor theory (either the classical political economists, anarchists, or Marxists) actually believed. I’m amazed at the number of people who smugly assert that Bohm-Bawerk, or Mises, or somebody “disproved” the LTV, who are almost completely unaware of the actual points of contention between the two sides. Bohm-Bawerk welcomed any attempt by LTV proponents to continue the debate, but expressed his hope that they would abandon the appeals to authority that so many relied on in favor of a reasoned argument based with an explicit explanatory mechanism for the LTV. Now, over a century later, the shoe is on the other foot, with marginalists and subjectivists regurgitating poorly understood third-hand arguments and appealing to the authority of Bohm-Bawerk (”everybody knows…”).
Re your question about the UAW and GM stock, the answer is that the U.S. government specifically outlawed (in the same package of legislation as Taft-Hartley) the buyup by union pension funds of voting shares of stock in their own employers. Congress feared that they would do exactly what you mention, and the country would wind up under some sort of CIO syndicalism.
Administrator said,
November 13, 2007 at 1:45 pm
A quick point about the labour theory of value (as I understand it): in the form that Kevin Carson defends (which he takes to be what most advocates of that theory traditionally meant; I’m not sufficiently up on the history to say yea or nay on that point), the price of a (reproducible) good brought to the market will tend, under free competition, to be governed by the subjective cost to the producer of the labour of making it, because if the good brings less to the producer than that cost, the producer will stop making it, and if the good brings more to the producer than that cost, the price will be whittled down by competition (assuming, I guess, that other producers’ subjective costs are comparable — perhaps a debatable assumption?). Hence if price and labour cost systematically diverge, that implies the existence of some sort of illegitimate intervention in the market.
Whatever the merits of this view, it’s not vulnerable to the mud-pie objection, and it’s at least not obviously incompatible with subjectivism or marginal utility. To the extent that Austrians disagree with it, the disagreement seems to have more to do with how fundamental an explanation it is rather than whether it’s blankly wrong. See Bob Murphy’s Austrian critique of Carson, and Carson’s reply.
Rich Paul said,
November 13, 2007 at 10:18 pm
It is true that in general the market price of a think will tend to approach the cost of producing that thing. This is not, however, limited to labor. Producing a thing may also deplete land resources. Consider an iron mine. There are no “iron gnomes” replenishing the mine through their labor and iron making prowess. When the iron is gone, it is gone.
Thus if you value a thing at the sum of the labor that has gone into a thing, and have no private property in land, you will undervalue the land itself, over-exploit it, and leave nothing behind. (see: the environmental disaster of the Former Soviet Union or Red China).
Under a capitalist system of private property, however, land, once it has been claimed by “mixing labor with it”, will be privately held. The value of the iron in the present market will have to be compared to the predicted future value of that same iron, discounted for time preferences. If the time preferences of the population as a whole do not match the owners’ time preferences, entrepreneurs can buy the land at an amount which satisfies the current owners’ preference for a smaller amount of money sooner, and the satisfy the (future) publics predicted desire for iron, while making money. This might not be in the form of not mining at all … they may just decide that they can work the mine more slowly and more efficiently (never forget the law or diminishing returns).
The end result is the reverse of the theory that costs determine price. Prices determine costs. The market price of the output, over time, determines the market prices of the inputs. This is called “imputation”.
As for the definition of capitalism, it seems that you guys have the same tendency as I … you want to use (and to have me use) your definitions of both socialism and capitalism. No anarcho-capitalist would ever say that he desires a system in which there is some kind of monopoly on ownership of capital. As a matter of fact, one of the major arguments against our crippled market is that regulation prevents people from becoming owners of capital. I did not know about the union regulation, but it fits the pattern. Of course, if the union had ceased to operate as a union, or if the workers had organized a “stock buying club” instead of a union, they would have been much better off. The “they were spending their money trying to get by” argument does not work … they lost the use of that money when they paid it in union dues, and it did not help them “get by”. The Mafia spent that money “trying to get by”, the workers just lost it.
Brad Spangler said,
November 13, 2007 at 11:41 pm
@Rich,
Regarding “No anarcho-capitalist would ever say that he desires a system in which there is some kind of monopoly on ownership of capital.”
Uhh, yeah, I know this. I have been a Rothbardian since 1990. You seem to be arguing in a reflexive pattern instead of responding to what I’m actually saying.
I said, essentially, that Rothbardian market anarchism is “anti-capitalist” in the sense that the word “capitalism” is sometimes used to refer to a statist monopoly of capital.
You just indirectly confirmed that yourself (not that I needed your validation, but heh…).
I didn’t once assert which is a more correct defintion of capitalism or socialism. I merely showed awareness of the differtent usages and indicated which I was referring to. You’re the one who metaphorically stomped his feet and pouted.
So, with regard to:
“it seems that you guys… want to use (and to have me use) your definitions of both socialism and capitalism.”
No, you’re projecting that. I’m aware of multiple definitions and proficient in switching back and forth between them in an intellectually honest manner. You’re only perceiving the parts I disagree with you on and blanking out the rest, as I have to make the case for THAT part of what I say. You don’t challenge me on my usage of words where my usage is in accord with your own. so of course it seems like I’m just as militant about definitions as you are. I’m not, though. You’re just not paying attention.
I’m a Rothbardian socialist in the sense that Benjamin Tucker was a “socialist” — by which I mean I advocate a completely free market, devoid of even the subsidies to Capital found in the fake laissez faire of the late 19th century US. In fact, I’ve commented at length elsewhere over a lengthy period of time about how Rothbardian property theory’s potential as a clearer basis for revolutionary redistribution of property arguably makes Rothbard “redder” than Tucker.
If by “capitalism” we mean legitimate property rights and a free market, I’m a “capitalist”.
If by ’socialism” we mean the revolutionary seizure of the property illegitimately held by the ruling class and the end of worker exploitation by monopolists of capital (who can only succeed in doing so via market intervention), then I’m as Red as they come, baby.
I am simultaneously to the right of Reagan and to the left of Lenin. Such is the non-Euclidean geometry of zero-state space.
Rich Paul said,
November 14, 2007 at 7:01 am
Before I discovered the Libertarian party, I used to say “No party will have me … I’m to the left of the democrats and to the right of the republicans”.
Gotta go to work and get exploited, more later.
Venus Cassandra said,
November 15, 2007 at 6:56 pm
I am a bit late in adding my two cents to this comment thread, but I figure that Roderick will get an email announcing my comment or something.
Speaking as an “ex” (I still have some anarcho-socialist tendencies) - communist anarchist type who now considers herself a left-libertarian mutualist or mutualist friendly anarchist, I would point out that communist anarchists generally have a different view of what constitutes exploitation than free market libertarians. The left-communist anarchist view of the state focuses on hierarchy as its defining exploitative feature and thus views any hierarchical economic entities as also being exploitative. The capitalist system’s essential feature is viewed as the hierarchy involved in work done for someone else that is paid in wages. This is obviously different from the aggressive use of force as the standard practice of taking advantage of people.
So, a communist anarchist might not view it as exploitative to render the factory owner factory-less, and committing acts of violence to usurp them of ownership, as constituting a violation of their rights. It would be seen as carrying out justice for the victimized wage workers. As a fight against unjust authority, power, and wealth. The third part of the equation dealing with some kind of LTV.
Of course, even the ardent communist anarchist FAQ at Infoshop.org will tell you that individualists would be left alone to pursue their own economic dreams, so it’s not an all or nothing affair. They would disagree that the competitive marketplace is likely to reduce concentrations of wealth or disperse economic power though, and would probably see any major inequalities of income as leading to a situation where a smaller number of people held real power in society.
Administrator said,
November 15, 2007 at 8:54 pm
For some excellent discussion of how left-wing market anarchists should think about exploitation, see this exchange between Matt MacKenzie and Charles Johnson.
Sheldon Richman said,
November 17, 2007 at 9:36 am
Fascinating discussion. My venture into the label wars is here:
http://www.fee.org/in_brief/default.asp?id=1709
Sheldon Richman said,
November 17, 2007 at 9:37 am
Oops. I forgot that I have a question. Would someone formally state The Social Question? Much seems to hang on this. Thanks.
Sheldon Richman said,
November 17, 2007 at 10:33 am
Apropos of value theories and mud pies:
“A thing cannot have value, if it is not a useful article. If it is not useful, then the labor it contains is also useless, does not count as labor and hence does not create value.”
That could have been written by Carl Menger, but it was written by Karl Marx (Capital, vol. 1; quoted in E. von Bohm-Bawerk, Capital and Interest, vol. 1, Chapter XII, “The Exploitation Theory,” note 75).
Rad Geek People’s Daily 2007-12-01 – Benjamin Tucker on Anarcho-Capitalism said,
December 2, 2007 at 1:14 am
[…] Social anarchists and anarcho-capitalists spend quite a bit of time fighting with each other over who gets to claim the individualist anarchists of the late 19th and early 20th century. The anarcho-capitalists point out the Liberty circle’s relentless emphasis on free markets, free competition, individually-held property, and opposition to communism. The social anarchists point out Tucker et al.’s self-identification as socialists, their relentless explicit attacks on the capitalist and landlord classes, their identification with nonviolent forms of labor militancy, and their analysis of interest on loans, rent on land, profits from the hiring out of capital, etc. as the creatures of state-fabricated privileges to the propertied classes. I don’t want to get too deep into these exegetical arguments right now; I’ve already discussed some of the semantic difficulties involved elsewhere (1, 2, 3, etc.), and Roderick has a couple of excellent posts on the topic at Austro-Athenian Empire (2007-04-01): Against Anarchist Apartheid and more recently Austro-Athenian Empire (2007-11-11): Voltairine de Cleyre, Anarcho-capitalist? For now, suffice it to say that both sides of the argument are substantially right, and substantially wrong; many anarcho-capitalists have been maddeningly selective, and substantially distorted the individualists in order to obscure or neglect the socialistic bite of the individualist understanding of class, privilege, and exploitation. But the social anarchists have also cut a lot of corners in explaining the individualists’ positions, which mostly serve to make Tucker, Spooner, Yarros, de Cleyre, etc. seem much more monolithic than they actually were, and to make them seem significantly less propertarian, and more friendly towards collectivistic and communistic socialism, than they actually were. Meanwhile the social anarchists’ reconstruction of anarcho-capitalist theory is so ferociously uncharitable, and so far out of touch with the versions of anarcho-capitalism espoused by central figures such as Karl Hess and Murray Rothbard in the period of Left and Right and Libertarian Forum, that frankly they ought to be embarrassed to show it in public. […]