Tuesday, August 19, 2008

Why I Am Not a Mutualist

Mutualism, particularly its Tuckerite branch, has fascinated me since my discovery of it several years ago. Why is it so fascinating to me? Because it is widely regarded by scholars as a leftist branch of free-market libertarianism. It’s genuinely left-wing…but it’s still free market libertarianism/anarchism. Who the hell doesn’t want to jump on that bandwagon? Where do I sign up?

Unfortunately, the more I looked into and thought about it, the more I began to realize why Rothbard created anarcho-capitalism in the first place. Mutualism is a confusing, dated, convoluted mess of a political philosophy with very dubious positions on economics. (I'm not going to spend much time on the labor theory of value, since it has been done elsewhere.)

“Syndical Syndrom:” Rothbard’s Critique of Mutualism

Most market anarchists are familiar with Rothbard’s critique of some Mutualist ideas in The Spooner-Tucker Doctrine: An Economist’s View. Less are aware of his critique in Syndical Syndrom, which in my opinion is a far better article. Excerpt:

In free-market capitalism, there have never been
any restrictions on workers banding together in producers'
coops to own their own capital equipment. And yet, in the
free economy, producers' coops have been notorious by
their non-existence, or rapid failure in competition with
'capitalist" firms. The reason is that, unknown to the
economically ignorant syndicalists, the capitalists perform
an extremely important service to the workers, as a
result of which most people prefer to be hired by capitalists
rather than be self or cooperatively employed. The
two basic functions are those of the "capitalist" per se
and those of the "entrepreneur". As a capitalist, the employer
saves money from his possible consumption, and
invests the money in paying workers their income in advance
of sale of product. In an automobile factory, the
capitalist pays workers their weekly wages now; in a producers'
cooperative factory, the workers would have to go
without income for months or years, until their product is
finally sold to the consumers. The capitalist earning of
"interest" for this advance payment is precisely equivalent
to the creditor who earns interest by lending someone
money now while being repaid at some point in the future.
In both cases, "interest" is earned as payment for savings
and time preference for income now rather than waiting
for the future.

The second service performed by the employer is to
assume the significant risks of entrepreneurship. A producers'
cooperative firm invests resources in a product,
and then hopes to sell that product to the consumers at a
net profit. But suppose that the efficiency and the foresight
of the workers is minimal; suppose, in short, that
they produce an Edsel that fails to sell? If they do, their
income is negative rather than positive, and they lose
capital assets which they can scarcely afford. In the
capitalist economy, the employer assumes these capital
risks, and only he therefore is subject to monetary losses
if his product is inefficiently produced or if he cannot achieve
satisfactory sales.

Most workers are unwilling or unable to assume these
risks of entrepreneurship, and therefore they greet the
employer's willingness to do so, as well as to pay them
in advance of sales, with sighs of relief. Or would if they
understood the process. We can confidently predict that
if Yugoslavia ever allows full-scale capitalist employment
(as it does now for small-scale enterprise) that its
producers' coops will rapidly give way to orthodox "capitalist"
modes of production - to the benefit of all concerned.

These are striking blows, IMO, to the mutualist position on rent, interest, and profit. How exactly are people going to survive when they have to wait YEARS to get paid? How many people have the money to invest in, say, a new airline, even if they wanted to? Without profit, I don't even see how modern retailers or wholesalers could exist. The mutualist answer to this argument has been mostly unimpressive. Kevin Carson's response:

Time preference is not a constant. It is skewed much more to the present for a laborer without independent access to the means of production, or to subsistence or security. Even the vulgar political economists recognized that the degree of poverty among the laboring classes determined their level of wages, and hence the level of profit.

Ok, fair enough, so state intervention and social standing are obviously going to impact one's time preference to some extent. But does anyone seriously believe that interest and profit are going to fall to zero!? Or that everyone is going to happily wait for months or years to get paid?

Even modern anti-capitalist individualist anarchists are a
little queasy about these positions:

Benjamin Tucker, a 19th Century individualist anarchist, and perhaps the most famous individualist anarchist of all, at one point, thought that not only ownership of land, but also all rent, business profits, and interest were wrong, and their victims should never be compelled to pay any of these, unless it was their choosing. He even thought that workers, renters, and lendees, who had once voluntarily agreed to respect these capitalist institutions, should later be able to go back and seek compensation for the wrongs done to them.

Today, with more developed economic theory, this doesn't seem to make so much sense -- if you prohibit all rent, profit, and interest, what will most likely happen is nobody will rent, lend, or make capital investments, and the poor will simply not be able to obtain housing, money, or physical capital to work with.

Another critique of the Mutualist position echoes Rothbard:

In a given anarcho-socialist business, production is owned entirely by those who worked upon the capital (for they own the capital,) and is presumably sold in some form of market.

Given that no one would give capital to an anarcho-socialist business for free, and given that no one can invest in an anarcho-socialist business for they can gain no return, therefore to gain employment workers must be forced to contribute capital. Which means that workers without capital are in an irresolvable situation, for they can neither gain employment nor capital, unless some charitable person were to grant them capital for free. A loan of capital to the worker is out of the question, for consider; the creditor purchases capital upon which the worker is employed, the creditor takes some of the production in return, which is no different from capitalist investment!, and this holds true even if the loan is issued by their future co-workers.

All workers must invest capital, and their remuneration must be commensurate with the amount that they invest; for any other would be grossly unfair. Workers however do different types of work, for different durations, requiring different skills. remuneration must also be commensurate with the type of work they do. Given that the remuneration, or ownership of production if you like, is dependent upon the level of investment and of work, both of which vary, why not allow people to invest and do no work, as per capitalism? And this brings to light the false distinction, for anarcho-socialism contains the capitalist element of capitalism, just that investors must work on their capital, which seems to me -- utterly stupid. Any level set by law which determines whether an individual investor is really ‘a worker’ or ‘an evil capitalist’ will be an arbitrary ratio between the level of investment and the level of work contributed. Now, the judgment by members of a business as whether to employ an additional co-worker will depend not only on the skills of the particular worker, the amount of remuneration relative to their contributed work that they desire and the business can afford, but also the amount of capital which this particular worker can and wishes to contribute. Given that this is specific to the worker, and given that each business will have different needs for capital, there will be no market-price for any type of labor, and so no reliable guide.

By forbidding all investment where the capitalist does not also work on the capital, businesses can only gain investment by employing more people, and individuals cannot invest unless they work, which means they also cannot distribute risk in their investments.

Unlike in the capitalist system, workers must work without pay until the product is sold.
The results of an anarcho-socialist system are inevitable; substantially reduced investment, increased poverty.

Assume though that an anarcho-socialist system were viable, and that one day a former worker decides to invest his/her earnings, except that he/she does not wish to work upon capital. Consider though that he/she offers employment to someone working elsewhere in a similar line of work for an anarcho-socialist business, and that the offer includes; immediate pay, no requirement of investment and therefore no risk, and a higher wage, and that the product is sold at a lower price to consumers. This would be forbidden. Yet... what is so wrong about it that it requires legislation?

To be fair, I don't believe Kevin Carson or other Mutualists would "forbid" this. Yet, this just leads to the next part of my critique:

Mutualism and Wage Labor: The Contradiction That Just Won't Go Away

Confusingly, many Mutualists support/supported wage labor, despite their opposition to profit. Huh!? That's right.

As Tucker put it,

...the minute you remove privilege, the class that now enjoy it will be forced to sell their labor, and then, when there will be nothing but labor with which to buy labor, the distinction between wage-payers and wage-receivers will be wiped out, and every man will be a laborer exchanging with fellow-laborers. Not to abolish wages, but to make every man dependent upon wages and secure to every man his whole wages is the aim of Anarchistic Socialism.

He also believed that...

When interest, rent, and profit disappear under the influence of free money, free land, and free trade, it will make no difference whether men work for themselves, or are employed, or employ others. In any case they can get nothing but that wage for their labor which free competition determines. Therefore they need not become their own employers.

Your average reader (whether a follower of Rothbard or Kropotkin or Marx) is now confused shitless. How, exactly, are you going to have wage labor without profit? Why in the world would you bother paying someone wages if you aren't hoping to see a return? It would defeat the entire point. A number of mutualists themselves (at least some on message boards and blogs) seem to think this is a contradiction.

The answer is even more confusing. Tucker wanted
wages to absorb profits. In other words, he wanted wages to rise to the laborer's "full product." Don't worry, I don't understand it either.

Nobody in the real world is going to put that much effort and risk into a project, just to let some schmuck off the street get the profits. Again, that would defeat the entire point of hiring someone.

If there is an answer to this contradiction, I haven't heard it.

"Occupancy and Use"? Maybe in the 19th Century.

Mutualists believe private property in land should be run on an "occupancy and use" basis. The problems with this are enormous.

If we followed this "occupancy and use" thing consistently, we would no longer have hotels, college dorms, or even parking spaces. Life would become extremely inconvenient. All companies that expanded beyond one building would not be able to operate. How a highway road would operate without being owned by someone is anyone's guess. And god help you if you want to go on a vacation (or not own a home).

D. Burton (again) is also skeptical of how well this would
work today.

..individualist anarchists have traditionally opposed the unlimited ownership of land, especially absentee ownership, for the purpose of passively collecting rent. In the 19th Century, the main idea was some kind of squatter sovereignty, in which individuals only had a right to land while they were using it. Any unused land was free for someone else to claim. That made a lot of sense in the frontier-type situation of 19th Century America. Today, there is a lot more complex and innovative though to deal with space constraints and environmental issues.

Out With The Old, In With The New

Most individualist anarchists today disagree with mutualism, but still find much to admire in it. I will admit that I greatly enjoy reading what Kevin Carson has to say, and that Tucker is one of my favorite anarchists. I may not always agree with their views, but I still find mutualism and old-school individualist anarchism to be quite fascinating.

To conclude, I'm going to cut and paste what I said in an earlier post:

Rothbardian anarcho-capitalism, influenced by Lysander Spooner and Benjamin Tucker, retains most of their spirit but omits their silly ideas and errors (such as the labor theory of value, which nobody believes in anymore). In my opinion, it is simply a modernized form of market anarchism with the crap cut out. Does that put it outside of historical/classical anarchism a bit? Yes. Who cares?


anarcho-mercantilist said...

Mutualism does not oppose employer-employee relationships. It just think that in a free market, it would be dominated by self-contractors who may work together as in a cooperative, just a matter of personal preference. Even if working as a self-contractor would compensate less than an employee, he may prefer to avoid employment to avoid obeying all commands by his employer.

These are striking blows, IMO, to the mutualist position on rent, interest, and profit.

They do not oppose these positions, they just think that in a free market, these would be unprofitable, hence would not exist as much as they currently do. Interest rates in a free market, without banking restrictions, would go down due to the fact thate individuals would make more loans without regulations. Thus, interest rates would go down. Rent would also go down with interest rates. Non-innovative profit from interest would approach to zero. The capitalist would not earn interest from his factory.

Proudhon clarified that "I never meant to ... prevent property from being freely and regularly acquired through sale and exchange, nor to forbid and suppress, by sovereign decree, ground rent and interest on capital. . . . all these forms of human activity should remain free and optional for all."

Thus, he implied that he does not oppose all voluntary transactions.

Take the definition of mutualism literally--the opposite of parasitism. Thus, free-market anarchism is mutualism because it is countra-parasitic. The mainstream and the literal definition of mutualism are both compatible with market anarchism, since Proudhon does not oppose voluntary transactions.

You also should take the literal definition of capitalism, which is "capital" (wealth) + "-ism" (ideology). Thus, capitalism is plutocracy.

If you take the literal definition of "wage slavery" and "surplus value," then they do exist. Wage slavery exist because monopoly firms have an advantage over workers. Surplus value exists because it is common to have a mark-up of 100% in American retail stores. If taxes comprise 50% of your income, then you only keep 25% of your income since both the 50% taxes and the 100% markup (also 50%) is lost.

Even though the ROI of American retail stores are low, they still may be an advantage since they are inefficient and does not keep all the profits resulting from the profit margin. They are inefficient because of monopoly and may have tax loopholes that hide their ROI. (they often outsource their profits to foreign low-tax states)

Use the literal definition, not the loaded form, since the latter is a floating abstraction and emotional.

Cork said...


My purpose here isn’t to argue whether interest rates would be lower or higher (though I have seen some good arguments they would be higher, considering current state policies), but that interest is not inherently immoral. Mutualists think it is, even though they won’t set up a police state to stop it, like the “anarcho”-communists.

I sometimes like to use the phrase “anarcho-capitalism” because it is provocative and enrages the lefties. The more vigorous their denunciations, the more entertaining it is to me. Simple as that. But I admit: I have come to like “market anarchism” better. It sounds better.

anarcho-mercantilist said...

My purpose here isn’t to argue whether interest rates would be lower or higher (though I have seen some good arguments they would be higher, considering current state policies)

Certainly, if the Federal Reserve stopped printing money to the banks, interest rates would go up. However, paradoxically, if the state deregulated the lending restrictions, then interest rates would be lower (again) because everyone can lend money to others without restrictions. The supply of funds would be higher because everyone can lend money without complicated licenses, which would result in lower interest rates.

So at first, if the Federal government eliminates printing, the interest rates would go up, but also it would go down if it additionally eliminated the banking restrictions restricting average people to lend money to others.

Mutualists think it is, even though they won’t set up a police state to stop it, like the “anarcho”-communists.

So if some market anarchists think that doing drugs is immoral but won't set up a police state, do you denounce them? If they set up voluntary anti-smoking programs because they think smoking is immoral, would you oppose these voluntary associations? Yes, mutualists oppose rent like market anarchists oppose drugs.

Cork said...

"So if some market anarchists think that doing drugs is immoral but won't set up a police state, do you denounce them? If they set up voluntary anti-smoking programs because they think smoking is immoral, would you oppose these voluntary associations?"

Of course not. I'm just explaining why I'm not a Mutualist: I don't consider interest or rent to be necessarily immoral or undesirable. Therefore, looking for ways to get rid of them isn't a goal of mine or part of my agenda.

As for interest rates, you make an interesting argument. Ultimately, the only way to find what rates would be like is to get rid of the state and then see what happens.

anarcho-mercantilist said...

As for interest rates, you make an interesting argument.

That's very likely to happen, and would likely to be much lower. Because individuals are not taxed on 80% of their income in anarchism, they would be five times richer. Because they are richer, they can loan out more money (most of their money is unnecessary), which would lower the interest rates substantially (perhaps even lower than the current subsidized Federal funds rate)!.

Think of getting rid of the parasitic taxes: both sides of the payroll taxes, federal and state taxes, excise taxes, property taxes, inflation taxes, the parasitic financial industry, the parasitic pharmeteutical industry, monopolized firms, business regulations, etc. would make individuals much more richer.

anarcho-mercantilist said...

the distinction between wage-payers and wage-receivers will be wiped out

If you actually believe the distinction between the employers and the employees would be wiped out in anarchism, they you must not criticize employment because there is no distinction.

For example, in anarchism, employers (the managers) would have a much lesser role in anarchism. Today, the employers (and CEOS) benefit from financial speculation, which would not exist without inflation.

"And yet, in the
free economy, producers' coops have been notorious by
their non-existence, or rapid failure in competition with
'capitalist" firms."

Today's existence of rich CEOs is due to speculation fued from inflation.

anarcho-mercantilist said...

Employment and employers would not exist in anarchism because there is no such legal distinction. Quit defending the "employers," you troll.

Cork said...

Heh, you're calling me a troll on my own blog? What do you mean employment and employers wouldn't exist? Of course they would. Even Tucker and Proudhon thought they would.

Like many so-called "left-libertarians," you act as if I'm unaware that the state grants privileges to employers and corporations under the current system. Duurrr...no shit, sherlock. Do I have to add that to every fucking sentence I write?

anarcho-mercantilist said...

Like many so-called "left-libertarians," you act as if I'm unaware that the state grants privileges to employers and corporations under the current system.

The left-libertarians, such as Alex Strekal (a.k.a. Brainpolice) and Karl Hess, used to be a hard-core Ron Paul and Barry Goldwater supporters repectively, and proponents of the Constitution. Alex Strekal wants to eliminate minimum wage rates, which is vulgar libertarian position. He thinks that labor regulations such as welfare and minimum wage is the cause of all society's problems. He at that time seems to be unaware about the parasitic financial, banking, trade, educational, pharmaceutical, physician, regulatory, licensing, legal, taxation, intellectual property and military industries; and how the artificially high interest rates (NOT artificially low) from the corrupt monetary system causes financial industry speculation, are the actual causes of society's problems. Thus, when the left-libertarians calls you a vulgar libertarian, he relates you with his past unawarance of state corruption. Strekal thinks that all anarcho-capitalists are unaware of the above corrupt industries, just like how he once was.

Why did you cite Rothbard's empirical observation that the contemporary lack of cooperative associations (by your definition) would reflect the same as it would in anarchism?

And yet, in the
free economy, producers' coops have been notorious by
their non-existence, or rapid failure in competition with
'capitalist" firms.

Just they does not exist now, it does not mean it would not exist in anarchism. Think about it. The artificial distribution of income inequality would make only the rich afford to fund massive amounts of capital to start an employer-controlled business. Also, because the artificially high interest rates (only privileged banks can borrow at the Federal funds rate), workers cannot borrow much money to donate capital to start his own cooperative.

If you want examples of currently-existing cooperative associations, then here you go: shopping malls and strip malls are cooperative associations of independent contractors and sole proprietorships. For an example list, see list of retail cooperatives.

One advantage of cooperative associations is that the employers would not have the right to arbitrary give orders to the employee like in serfdom. The workers would be free from employer orders and authority, which would subjectively improve his conditions even if he would be compensated less.

Cork said...

Eliminating the minimum wage is not the "vulgar libertarian" position. It's the pro-worker position. Big business loves the minimum wage, btw (it's an easy way to hassle their smaller competitors).

Why did you cite Rothbard's empirical observation that the contemporary lack of cooperative associations (by your definition) would reflect the same as it would in anarchism?

Their lack of existence has nothing to do with state-granted privileges to corporations. They rarely exist for the same reason communes rarely exist, and I doubt that would change much under anarchism. In fact, state intervention is the only reason they have existed in so many countries. I believe they get special tax breaks and benefits even here in the US.

Your list of supposed cooperative retailers is very dodgy. I mean, Ace Hardware? ROFL. That place definitely has managers and bosses. Even the left-anarchists' favorite example (Mondragon) is nothing close to a pure syndicalist style co-op. These places all have hierarchy and specialization.


Cork said...

I also disagree with you that the employer-employee relationship is authoritarian (or at least inherently authoritarian).

I'm planning to do a post on this soon, so I won't go through it now.

anarcho-mercantilist said...

Eliminating the minimum wage is not the "vulgar libertarian" position. It's the pro-worker position.

But if you eliminate the corporative privileges that monopolizes the corporations, they would pay the worker in a much higher income, therefore minimum wages are not needed. Eliminating minimum wage would bring the wages of the workers down on the already low wages caused by monopoly firms. So if you oppose minimum wage while you support other corrupted regulations, you are INTENSIFYING the state-sanctioned corruption that impoverishes the workers.

As said, fixing minimum wage would improve only 0.001% of the corruption. Why eliminate minimum wages when workers' wages are very low because of corruption in the first place? If you eliminate the other 99.999% of the corruption, the wages would natually rise much above, so minimum wages do not hurt any business, including big businesses and small businesses if the other 99.999% of the corruption is repealed.

Another example: Unemployment is purely state-caused. Welfare would compensate the unemployed individuals. Eliminating welfare is worsening the state-induced impoverishment. Thus, opposing welfare while supporting the current system actually worsening the already state-caused unemployment.

While it is immoral for the state to fix the damage caused by the state, it is more immoral to oppose the fixes such as welfare. If you eliminate welfare, individuals would starve to death because it is not a free market. Repealing minimum wage is actually leveraging state-sanctioned unemployment to harm individuals even more.

Eliminating minimum wage does not ELIMINATE unemployment. What about the labor unions, employee firing and hiring regulations, business regulations that prohibit start-ups that also causes unemployment? As said, eliminating minimum wage is intensifying the state-sanctioned low-wage rates of the workers from other types of corruption.

Big business loves the minimum wage, btw (it's an easy way to hassle their smaller competitors).

It's just a 0.001% compared to the much more serious corrupt regulations that are millions of times worse. Why focus on minimum wage? Are you a reformist? If you deny reformism, then you MUST not both support nor oppose minimum wage. You should not even discuss about minimum wage.

If are a reformist, eliminating minimum wage without eliminating the causes of low real wages first (e.g. corruption and high prices) is actually not the best way to eliminate oppression. You should eliminate business monopolies that pays their workers lower than the market rate first, before you elminate minimum wages. You should elminate regulations that support monopoly retail stores that charges a markup of 100% first, before you elminate minimum wage.

In the free market, workers would be paid much more than the minimum wage. Supporting minimum wage in the current system is intensifying state oppression, since it is not a free market. So opposing minimum wage, per se, is a vulgar libertarian positions.

Big business loves the minimum wage, btw (it's an easy way to hassle their smaller competitors).

The secret is that big business loves minimum wage is because they can afford to pay their workers more BECAUSE they do not have to spend much on regulatory compliance IN PROPORTION to smaller businesses! Smaller businesses cannot afford the regressive costs of regulatory compliance while paying state-dictated minimum wages. If you eliminate the regressive regulatory compliance costs in the first place, then minimum wage would not benefit big businesses anymore!

Don't you realize that?!

Cork said...

Even under our current corporatist-fascist system, workers are better off with the minimum wage terminated.



Obviously we shouldn't stop there, but keeping it in place or raising it will only have bad effects.

Why focus on minimum wage? Are you a reformist? If you deny reformism, then you MUST not both support nor oppose minimum wage. You should not even discuss about minimum wage."

Uhhh..last time I checked, you were the one who brought it up. I'm just going against your claim that we have to "wait" to repeal minimum wage, welfare, and so on until every other thing is repealed (which will be never).

That is a complete road to nowhere, and will never accomplish anything. It's the exact same mindset that Libertarian Party members have. "Guys, we have to be realistic and abolish things in a specific order." Bullshit.

You get rid of whatever you can whenever you can, or you will never get anything done. You're like the paleolibertarians who say "Guys, we have to get rid of welfare before we abolish the border controls." Bullshit.

See my post, "Why Gradualism and Pragmatism Are Completely Worthless."

anarcho-mercantilist said...

I'm just going against your claim that we have to "wait" to repeal minimum wage, welfare, and so on until every other thing is repealed (which will be never).

If you repeal everything if there is opportunity, it is still a form of gradualism since you advocate a state to gradually repeal regulations.

The only way to repeal regulations is to repeal them all at once.

You cannot repeal some regulations and wait to repeal others when the opportunity arises. If you are given the opportunity to repeal minimum wage, unions, and corporate taxes in one day, repeal some tomorrow, and go on and repeal more and more, it would cause chaos and takes too much time. It would take hundreds of years to repeal the massive amounts of regulations if given this rate. You cannot even have the time to read all the regulations to repeal them.

It would also be difficult for you to lobby the state to repeal minimum wage and labor regulations. You cannot compete with the big multibillionaire businesses that lobby regulations. Imagine repealing all the regulations. It would be millions of time more difficult.

As you said in your post.

Begging on your knees like a fucking pathetic baby to implement tiny, pitiful, meaningless changes that will quickly be reversed

Repealing minimum wage is a meaningless change. Repealing all things given regardless if you follow the order or not, is a form of graudalism!

Remember that certain combinations of regulations would interact in a nonlinear fashion, which would produce chaotic results and may be worser than no repeal at all. This frequently occurs if you repeal some regulations while leaving others intact. For example, if given the opportunity, would you repeal the national defence in the current systeme? How about repealing all the prisons? Yes, these have benefits, but they also have problems.

Cork said...

Dude, I'm an agorist for cryin' out loud (at least in the sense of accepting the counter-economics theory). I am nowhere close to being a "reformer."

I don't claim that the state should "gradually repeal regulations," as my ultimate strategy. I'm only saying that whenever you do have a chance to reduce the state's power in some way you should do it.

For example, if given the opportunity, would you repeal the national defence in the current systeme?

This is a joke, right? What market anarchist wouldn't abolish the US military at the snap of a finger?

You seem to be a 'Noam Chomsky' anarchist. "Get rid of the state some day, but in the mean time keep it as powerful and centralized as humanly possible." If that's a 'reformer' stance, I don't know what is.

Cork said...

I meant to write, "If that's not a reformer stance, I don't know what is."

Cork said...

I'm only saying that whenever you do have a chance to reduce the state's power in some way you should do it.

Let me be more clear about this. I am not advocating participation in politics or lobbying the state. I'm just saying that if the state rulers are considering getting rid of a law or regulation (perhaps for public pressure or any reason), you should "support" it and speak in favor of it, instead of begging the state to keep it in place.

Cork said...


read this:

anarcho-mercantilist said...

If you want to eliminate some regulations, given some opportunity, it is just as immoral as keeping the regulation. For example, if you eliminate national defense, the unemployed would be killed because they cannot afford national defense. Eliminating national defense has the same immorality as keeping national defense. Eliminating national defense if just shifting the burden from the Iraqis to the unemployed. If you want to abolish national defense because there are greater numbers of Iraqis saved than the unemployed hurt, you are just acknowledging purely numerical amounts. It is utilitarian to eliminate national defense without eliminating the state itself. Would you kill a few people to abolish some regulations? What if the one of the people killed is you?

This is a joke, right? What market anarchist wouldn't abolish the US military at the snap of a finger?

Yes, I would rather prefer national defense eliminated (as a practical consequentialist solution) rather than not eliminate it, but morality-wise, the elmination or not would are all identically immoral (since you are just shifting the burden from the Iraqis to the unemployed). The only way to eliminate regulations is to eliminate all regulations in a short period of time.

Kevin Carson said...

Thanks for the mention and the thoughtful analysis.

Below are my comments in reply to an email correspondent who drew my attention to your piece (following his remarks quoted).

> Why I Am Not a Mutualist - This one is brand new and comes from a
> self-described "Rothbardian market anarchist".

> I'm particularly interested in your response to the delayed paycheck
> argument and the argument that profit is payment for the risk of
> entrepreneurship (this is how I've always thought of it naturally but that
> doesn't mean I'm not biased). Also, he discusses occupancy and use. This is
> something I don't see discuss in terms of practical implementation much. I
> always here the objection that people would take your house when you go on
> vacation. I imagined that this was rather silly since in practice it would
> likely involve some sort of control mechanism such as registering the
> property with some public mechanism as "in use" and requiring renewals (with
> reasonable time frames) before a property could become abandoned.
> Furthermore, cross-checks could prevent absentee property acquisition. Is
> that how you see it working? Of course, my idea sounds > kind of like a state.

In fairness to Cork, I think he was specifically unimpressed with my argument for the limited relevance of time preference (depending on property distribution).

But I'm equally unimpressed with the material by Rothbard that he appeals to as an authority. Rothbard keeps asserting that producer cooperatives have never caught on, despite having always been permitted under "free market capitalism" or in "the free economy." I have to wonder what bearded Spock universe this free economy existed in. The Enclosures and Combination Laws were barely over before the state started subsidizing the new corporate economy. One might just as well take the lack of genuine worker-owned enterprise in the old USSR as evidence that it was uncompetitive.

As for the labor-fund doctrine, it rests on a fundamental misconception: that the capitalist actually accumulates a labor fund over time through abstention, until he's saved enough, and then pays workers' wages out of that during the production process, and then finally recompenses himself by selling the product. In fact, as Hodgskin argued in both *Labour Defended* and *Popular Political Economy*, what workers consume during the production process comes from current production by other workers. This is obtained by a claim on the current production of those other workers, whether by a capitalist employer or worker-owners, mediated by the credit system. So what we really have to look at is why the capitalist is in a position of privileged access to the credit system while the workers aren't, and is therefore able to preempt the ability of different groups of workers to make such arrangements between themselves through some sort of federal mutual credit arrangement. I discuss this at somewhat greater length in draft Ch. 11 of the org theory MS.

Likewise, his objection re the unwillingness of conventional creditors to lend money to an anarcho-socialist enterprise assumes the a-s enterprise existing as an island in a conventional capitalist sea. My counter-question is, why couldn't enterprises obtain capital through the cooperative pooling of resources between federated workers' co-ops?

As a Rothbardian, Cork should understand the difference between profit in the sense of the originary rate of interest (i.e., on capital as such), and entrepreneurial profit. Most non-Austrians who talk about profit (including Tucker and the individualists) take the term primarily in the first sense. On the other hand, neither Tucker nor I object to entrepreneurial profit. The belief that profits on capital as such would fall to near zero even in wage employment is fully compatible with the belief that the employer's return would include amortization costs of his investment, plus a "profit" equivalent to his wages of superintendence.

Your [emailer] impression of the occupancy-and-use issues is on the mark, IMO. Cork's questions about going on vacation are a red herring. As Tucker pointed out, occupancy and use would be enforced by local juries in a society of small possessor-owners, whose primary concern (naturally) would be to avoid the evil of large-scale absentee ownership while maintaining the security and convenience of small possessor-owners. So it's unlikely that they'd put an interpretation on occupancy-and-use that left them in peril of expropriation whenever they went on a long vacation or even trotted down to the Piggly Wiggly for a half gallon of milk. Some reasonable judicial criteria for determining constructive abandonment would surely be adopted, with some due process required before somebody could simply move in like Goldilocks and start eating your porridge.

The question of hotels and the like is a genuine one. I don't know of any "canonical" answer. As with vacations and the like, my own guess is that the law of occupancy-and-use would be understood to exist for man, and not man for the law, and that so long as the primary evil of large-scale absentee ownership of people's permanent residences didn't exist, some common-sense local consensus would determine how to handle such things as hotels.

I think the highway is also a red herring. See Roderick Long's work on common property under market anarchism. There's no reason rights of way couldn't be common property without a state, with the roads being owned and maintained by communities or neighborhoods.

Mike Gogulski said...

Finally I got to reading this. Saves me writing a post I've been thinking of for a month with, well, the exact same title!

For myself, if I were forced to choose immediately between accepting the mutualist anarchy and the present (or any) states, I'd jump aboard for mutualism without hesitation. I'd pick a different theory, though, if my choice weren't forced.

An interesting question, to me at least: are you aware of any writing exploring scenarios in which mutualist and ancap societies coexist and intermingle?

I imagine that if there were no states and half of the people were mutualists while the remainder were ancaps, and assuming that all historical property disputes had already been settled, that if the two philosophies competed in the marketplace, mutualism would lose. For reasons of the risks you point out, I would expect that starting from a 50/50 distribution, a big chunk of the folks in the mutualist camp would rapidly switch their allegiance, probably signing up for an ancap DRO or PDA or whatever that didn't carry the mutualist restrictions and bias. That would leave the mutualists at what can be presumed a competitive disadvantage to the degree that market share drives perception and in access to resources to build the mutualist economy. At that point, competition between the two systems -- at least such competition as might be inferred from taking productivity, wealth, efficiency, general satisfaction or other measures of desirable aggregates -- would have to run its course a good while for us to really know which system would come to be accepted most broadly.

Would mutualism die out entirely? I doubt it; I suspect there might be many communities and/or cultures in which mutualism might enjoy a coequal or dominant position over the ancap paradigm. I also suspect that mutualist and ancap communities, both separate and overlapping, could coexist, provided the two camps could agree on property dispute arbitrators, which I also suspect they could.