~corti-nico/ubuntu/vivid/anarchism/fix1426015 : revision 5

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Appendix -- Is "anarcho"-capitalism a type of anarchism?

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1 Are "anarcho"-capitalists really anarchists?

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1.1 Why is the failure to renounce hierarchy the Achilles Heel

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of right-wing libertarianism?

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1.2 How libertarian is right-Libertarian theory?

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1.3 Is right-Libertarian theory scientific in nature?

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1.4 Is "anarcho"-capitalism a new form of individualist anarchism?

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2 What do "anarcho"-capitalists mean by "freedom?"

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2.1 What are the implications of defining liberty in

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terms of (property) rights?

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2.2 How does private property affect freedom?

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2.3 Can "anarcho"-capitalist theory justify the state?

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2.4 But surely transactions on the market are voluntary?

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2.5 But surely circumstances are the result of liberty

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and so cannot be objected to?

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2.6 Do Libertarian-capitalists support slavery?

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2.7 But surely abolishing capitalism would restrict liberty?

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2.8 Why should we reject the "anarcho"-capitalist definitions

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of freedom and justice?

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3 Why do 'anarcho'-capitalists generally place little or no

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value on equality?"

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3.1 Why is this disregard for equality important?

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3.2 But what about "anarcho"-capitalist support for charity?

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4 What is the right-libertarian position on private property?

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4.1 What is wrong with a "homesteading" theory of property?

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4.2 Why is the "Lockean Proviso" important?

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4.3 How does private property affect individualism?

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4.4 How does private property affect relationships?

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4.5 Does private property co-ordinate without hierarchy?

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5 Will privatising "the commons" increase liberty?

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6 Is "anarcho" capitalism against the state?

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6.1 What's wrong with this "free market" justice?

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6.2 What are the social consequences of such a system?

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6.3 But surely Market Forces will stop abuse by the rich?

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6.4 Why are these "defence associations" states?

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6.5 What other effects would "free market" justice have?

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8 What role did the state take in the creation of capitalism?

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8.1 What social forces lay behind the rise of capitalism?

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8.2 What was the social context of the statement "laissez-faire"?

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8.3 What other forms did state intervention in creating

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capitalism take?

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8.4 Aren't the enclosures a socialist myth?

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8.5 What about the lack of enclosures in the Americas?

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8.6 How did working people view the rise of capitalism?

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8.7 Why is the history of capitalism important?

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9 Is Medieval Iceland an example of "anarcho"-capitalism working in

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practice?

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10 Would laissez-faire capitalism be stable?

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10.1 Would privatising banking make capitalism stable?

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10.2 How does the labour market effect capitalism?

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10.3 Was laissez-faire capitalism stable?

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11 What is the myth of "Natural Law"?

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11.1 Why "Natural Law" in the first place?

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11.2 But "Natural Law" provides protection for individual

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rights from violation by the State. Those against

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Natural Law desire total rule by the state.

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11.3 Why is "Natural Law" authoritarian?

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11.4 Does "Natural Law" actually provides protection for

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individual liberty?

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11.5 But Natural Law was discovered, not invented!

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11.6 Why is the notion of "discovery" contradictory?

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* Is "anarcho"-capitalism a type of anarchism?

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Anyone who has followed political discussion on the net has probably come

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across people calling themselves libertarians but arguing from a right-wing,

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pro-capitalist perspective. For most Europeans this is weird, as in Europe

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the term "libertarian" is almost always used in conjunction with "socialist"

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or "communist." In the US, though, the Right has partially succeeded in

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appropriating this term for itself. Even stranger, however, is that a few of

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these right-wingers have started calling themselves "anarchists" in what

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must be one of the finest examples of an oxymoron in the English language:

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'Anarcho-capitalist'!!

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Arguing with fools is seldom rewarded, but to allow their foolishness to go

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unchallenged risks allowing them to deceive those who are new to anarchism.

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That's what this section of the anarchist FAQ is for, to show why the claims

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of these "anarchist" capitalists are false. Anarchism has always been

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anti-capitalist and any "anarchism" that claims otherwise cannot be part

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of the anarchist tradition. So this section of the FAQ does not reflect

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some kind of debate within anarchism, as many of these types like to pretend,

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but a debate between anarchism and its old enemy, capitalism. In many ways

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this debate mirrors the one between Peter Kropotkin and Herbert Spencer, an

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English pro-capitalist, minimal statist, at the turn the 19th century

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and, as such, it is hardly new.

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The "anarcho"-capitalist argument hinges on using the dictionary definition

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of "anarchism" and/or "anarchy" - they try to define anarchism as being

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"opposition to government," and nothing else. However, dictionaries are

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hardly politically sophisticated and their definitions rarely reflect the

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wide range of ideas associated with political theories and their history.

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Thus the dictionary "definition" is anarchism will tend to ignore its

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consistent views on authority, exploitation, property and capitalism (ideas

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easily discovered if actual anarchist texts are read). And, of course, many

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dictionaries "define" anarchy as "chaos" or "disorder" but we never see

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"anarcho"-capitalists use that particular definition!

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And for this strategy to work, a lot of "inconvenient" history and ideas

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from all branches of anarchism must be ignored. From individualists

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like Spooner and Tucker to communists like Kropotkin and Malatesta,

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anarchists have always been anti-capitalist (see section G for more on

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the anti-capitalist nature of individualist anarchism). Therefore

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"anarcho"-capitalists are not anarchists in the same sense that

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rain is not dry.

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Of course, we cannot stop the "anarcho"-capitalists using the words

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"anarcho", "anarchism" and "anarchy" to describe their ideas. The

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democracies of the west could not stop the Chinese Stalinist state calling

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itself the People's Republic of China. Nor could the social democrats

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stop the fascists in Germany calling themselves "National Socialists".

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Nor could the Italian anarcho-syndicalists stop the fascists using the

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expression "National Syndicalism". This does not mean that any of these

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movements actual name reflected their content -- China is a dictatorship,

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not a democracy, the Nazi's were not socialists (capitalists made fortunes

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in Nazi Germany because it crushed the labour movement), and the Italian

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fascist state had nothing in common with anarcho-syndicalists ideas of

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decentralised, "from the bottom up" unions and the abolition of the

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state and capitalism.

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Therefore, just because someone uses a label it does not mean that they

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support the ideas associated with that label. And this is the case with

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"anarcho"-capitalism -- its ideas are at odds with the key ideas associated

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with all forms of traditional anarchism (even individualist anarchism

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which is often claimed as being a forefather of the ideology).

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All we can do is indicate *why* "anarcho"-capitalism is not part of the

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anarchist tradition and so has falsely appropriated the name. This section

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of the FAQ aims to do just that -- present the case why "anarcho"-capitalists

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are not anarchists. We do this, in part, by indicating where they differ

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from genuine anarchists (on such essential issues as private property,

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equality, exploitation and opposition to hierarchy) In addition, we take

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the opportunity to present a general critique of right-libertarian claims

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from an anarchist perspective. In this way we show up why anarchists reject

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that theory as being opposed to liberty and anarchist ideals.

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We are covering this topic in an anarchist FAQ for three reasons.

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Firstly, the number of "libertarian" and "anarcho"-capitalists on the

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net means that those seeking to find out about anarchism may conclude

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that they are "anarchists" as well. Secondly, unfortunately, some

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academics and writers have taken their claims of being anarchists at

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face value and have included their ideology into general accounts of

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anarchism. These two reasons are obviously related and hence the need

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to show the facts of the matter. As we have extensively documented

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in earlier sections, anarchist theory has always been anti-capitalist.

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There is no relationship between anarchism and capitalism, in any

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form. Therefore, there is a need for this section in order to indicate

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exactly why "anarcho"-capitalism is not anarchist. As will be quickly

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seen from our discussion, almost all anarchists who become aware of

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"anarcho"-capitalism quickly reject it as a form of anarchism (the

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better academic accounts do note that anarchists generally reject

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the claim, though). The last reason is to provide other anarchists

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with arguments and evidence to use against "anarcho"-capitalism and

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its claims of being a new form of "anarchism."

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So this section of the FAQ does not, as we noted above, represent some kind

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of "debate" within anarchism. It reflects the attempt by anarchists to

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reclaim the history and meaning of anarchism from those who are attempting

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to steal its name (just as right-wingers in America have attempted to

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appropriate the name "libertarian" for their pro-capitalist views, and by

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so doing ignore over 100 years of anti-capitalist usage). However, this

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section also serves two other purposes. Firstly, critiquing right-libertarian

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and "anarcho"-capitalist theories allows us to explain anarchist ones at

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the same time and indicate why they are better. Secondly, and more

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importantly, the "ideas" and "ideals" that underlie "anarcho"-capitalism

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are usually identical (or, at the very least, similar) to those of

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neo-liberalism. This was noted by Bob Black in the early 1980s, when

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a "wing of the Reaganist Right has obviously appropriated, with suspect

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selectivity, such libertarian themes as deregulation and voluntarism.

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Ideologues indignant that Reagan has travestied their principles. Tough

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shit! I notice that it's their principles, not mine, that he found suitable

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to travesty." [_The Libertarian As Conservative_] This was echoed by Noam

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Chomsky two decades later when while "nobody takes [right-wing libertarianism]

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seriously" as "everybody knows that a society that worked by . . . [its]

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principles would self-destruct in three seconds" the "only reason" why

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some people "pretend to take it seriously is because you can use it as

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a weapon." [_Understanding Power_, p. 200] As neo-liberalism is being

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used as the ideological basis of the current attack on the working class,

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critiquing "anarcho"-capitalism and right-libertarianism also allows use

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to build theoretical weapons to use to resist this attack and aid the

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class struggle.

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A few more points before beginning. When debating with "libertarian"

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or "anarchist" capitalists it's necessary to remember that while they

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claim "real capitalism" does not exist (because all existing forms of

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capitalism are statist), they will claim that all the good things we

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have -- advanced medical technology, consumer choice of products, etc.

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in modern life, these will be blamed on "statism." Since there has never

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been and never will be a capitalist system without some sort of state,

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it's hard to argue against this "logic." Many actually use the example

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of the Internet as proof of the power of "capitalism," ignoring the

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fact that the state paid for its development before turning it over

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to companies to make a profit from it. Similar points can be made

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about numerous other products of "capitalism" and the world we live

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in. To artificially separate one aspect of a complex evolution fails

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to understand the nature and history of the capitalist system.

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In addition to this ability to be selective about the history and

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results of capitalism, their theory has a great "escape clause." If

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wealthy employers abuse their power or the rights of the working class

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(as they have always done), then they have (according to "libertarian"

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ideology) ceased to be capitalists! This is based upon the misperception

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that an economic system that relies on force *cannot* be capitalistic.

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This is *very* handy as it can absolve the ideology from blame for any

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(excessive) oppression which results from its practice. Thus individuals

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are always to blame, *not* the system that generated the opportunities for

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abuse they freely used.

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Anarchism has always been aware of the existence of "free market"

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capitalism, particularly its extreme (minimal state) wing, and has

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always rejected it. As we discuss in section 7, anarchists from

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Proudhon onwards have rejected the idea of any similar aims and

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goals (and, significantly, vice versa). As academic Alan Carter

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notes, anarchist concern for equality as a necessary precondition

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for genuine freedom means "that is one very good reason for not

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confusing anarchists with liberals or economic 'libertarians'

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some way or another critical of the state. It is why calling the

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likes of Nozick 'anarchists' is highly misleading." ["Some notes

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on 'Anarchism'", pp. 141-5, _Anarchist Studies_, vol. 1, no. 2,

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p. 143] So anarchists have evaluated "free market" capitalism and

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rejected it as non-anarchist for over 150 years. Attempts by

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"anarcho"-capitalism to say that their system is "anarchist" flies

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in the face of this long history of anarchist analysis. That some

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academics fall for their attempts to appropriate the anarchist

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label for their ideology is down to a false premise: it "is judged

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to be anarchism largely because some anarcho-capitalists *say* they

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are 'anarchists' and because they criticise the State." [Peter

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Sabatini, _Social Anarchism_, no. 23, p. 100]

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More generally, we must stress that most (if not all) anarchists do not

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want to live in a society *just like this one* but without state coercion

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and (the initiation of) force. Anarchists do not confuse "freedom" with

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the "right" to govern and exploit others nor with being able to change

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masters. It is not enough to say we can start our own (co-operative)

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business in such a society. We want the abolition of the capitalist

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system of authoritarian relationships, not just a change of bosses

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or the possibility of little islands of liberty within a sea of

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capitalism (islands which are always in danger of being flooded

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and our activity destroyed). Thus, in this section of the FAQ,

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we analysis many "anarcho"-capitalist claims on their own terms

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(for example, the importance of equality in the market or why

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capitalism cannot be reformed away by exchanges on the capitalist

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market) but that does not mean we desire a society nearly identical

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to the current one. Far from it, we want to transform this society

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into one more suited for developing and enriching individuality and

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freedom. But before we can achieve that we must critically evaluate

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the current society and point out its basic limitations.

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Finally, we dedicate this section of the FAQ to those who have seen the

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real face of "free market" capitalism at work: the working men and women

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(anarchist or not) murdered in the jails and concentration camps or on the

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streets by the hired assassins of capitalism.

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1 Are "anarcho"-capitalists really anarchists?

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In a word, no. While "anarcho"-capitalists obviously try to associate

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themselves with the anarchist tradition by using the word "anarcho"

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or by calling themselves "anarchists", their ideas are distinctly at

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odds with those associated with anarchism. As a result, any claims that

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their ideas are anarchist or that they are part of the anarchist

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tradition or movement are false.

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"Anarcho"-capitalists claim to be anarchists because they say that they

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oppose government. As such, as noted in the last section, they use

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a dictionary definition of anarchism. However, this fails to appreciate

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that anarchism is a *political theory*, not a dictionary definition.

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As dictionaries are rarely politically sophisticated things, this means

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that they fail to recognise that anarchism is more than just opposition to

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government, it is also marked a opposition to capitalism (i.e. exploitation

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and private property). Thus, opposition to government is a necessary

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but not sufficient condition for being an anarchist -- you also need

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to be opposed to exploitation and capitalist private property. As

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"anarcho"-capitalists do not consider interest, rent and profits (i.e.

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capitalism) to be exploitative nor oppose capitalist property rights,

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they are not anarchists.

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Moreover, "anarcho"-capitalism is inherently self-refuting. This can be

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seen from leading "anarcho"-capitalist Murray Rothbard. he thundered

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against the evil of the state, arguing that it "arrogates to itself a

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monopoly of force, of ultimate decision-making power, over a given area

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territorial area." In and of itself, this definition is unremarkable.

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That a few people (an elite of rulers) claim the right to rule others

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must be part of any sensible definition of the state or government.

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However, the problems begin for Rothbard when he notes that

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"[o]bviously, in a free society, Smith has the ultimate decision-making

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power over his own just property, Jones over his, etc." [_The Ethics of

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Liberty_, p. 170 and p. 173] The logical contradiction in this position

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should be obvious, but not to Rothbard. It shows the power of ideology,

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the ability of means words (the expression "private property") to turn

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the bad ("ultimate decision-making power over a given area") into the

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good ("ultimate decision-making power over a given area").

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Now, this contradiction can be solved in only *one* way -- the owners

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of the "given area" are also its users. In other words, a system of

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possession (or "occupancy and use") as favoured by anarchists. However,

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Rothbard is a capitalist and supports private property. In other

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words, wage labour and landlords. This means that he supports a

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divergence between ownership and use and this means that this

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"ultimate decision-making power" extends to those who *use,* but do

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not own, such property (i.e. tenants and workers). The statist nature

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of private property is clearly indicated by Rothbard's words -- the

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property owner in an "anarcho"-capitalist society possesses the

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"ultimate decision-making power" over a given area, which is also what

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the state has currently. Rothbard has, ironically, proved by his own

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definition that "anarcho"-capitalism is not anarchist.

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Rothbard does try to solve this obvious contradiction, but utterly fails.

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He simply ignores the crux of the matter, that capitalism is based on

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hierarchy and, therefore, cannot be anarchist. He does this by arguing

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that the hierarchy associated with capitalism is fine as long as the

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private property that produced it was acquired in a "just" manner. In

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so doing he yet again draws attention to the identical authority

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structures and social relationships of the state and property. As

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he puts it:

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"*If* the State may be said too properly *own* its territory, then

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it is proper for it to make rules for everyone who presumes to

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live in that area. It can legitimately seize or control private

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property because there *is* no private property in its area,

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because it really owns the entire land surface. *So long* as

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the State permits its subjects to leave its territory, then, it

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can be said to act as does any other owner who sets down rules

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for people living on his property." [Op. Cit., p. 170]

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Obviously Rothbard argues that the state does not "justly" own its

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territory -- but given that the current distribution of property

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is just as much the result of violence and coercion as the state,

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his argument is seriously flawed. It amounts, as we note in section

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4, to little more than an "immaculate conception of property"

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unrelated to reality. Even assuming that private property was

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produced by the means Rothbard assumes, it does not justify the

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hierarchy associated with it as the current and future generations

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of humanity have, effectively, been excommunicated from liberty by

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previous ones. If, as Rothbard argues, property is a natural right

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and the basis of liberty then why should the many be excluded from

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their birthright by a minority? In other words, Rothbard denies that

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liberty should be universal. He chooses property over liberty while

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anarchists choose liberty over property.

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Even worse, the possibility that private property can result in *worse*

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violations of individual freedom (at least of workers) than the state

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of its citizens was implicitly acknowledged by Rothbard. He uses as a

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hypothetical example a country whose King is threatened by a rising

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"libertarian" movement. The King responses by "employ[ing] a cunning

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stratagem," namely he "proclaims his government to be dissolved, but

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just before doing so he arbitrarily parcels out the entire land area

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of his kingdom to the 'ownership' of himself and his relatives." Rather

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than taxes, his subjects now pay rent and he can "regulate to regulate

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the lives of all the people who presume to live on" his property as he

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sees fit. Rothbard then asks:

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"Now what should be the reply of the libertarian rebels to this pert

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challenge? If they are consistent utilitarians, they must bow to this

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subterfuge, and resign themselves to living under a regime no less

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despotic than the one they had been battling for so long. Perhaps,

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indeed, *more* despotic, for now the king and his relatives can claim

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for themselves the libertarians' very principle of the absolute right

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of private property, an absoluteness which they might not have dared

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to claim before." [Op. Cit., pp. 54-5]

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So not only does the property owner have the same monopoly of power

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over a given area as the state, it is *more* despotic as it is based

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on the "absolute right of private property"! And remember, Rothbard

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is arguing *in favour* of "anarcho"-capitalism. ("if you have unbridled

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capitalism, you will have all kinds of authority: you will have *extreme*

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authority." [Chomksy, _Understanding Power_, p. 200]). So in practice,

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private property is a major source of oppression and authoritarianism within

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society -- there is little or no freedom within capitalist production

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(as Bakunin noted, "the worker sells his person and his liberty for

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a given time"). So, in stark contrast to anarchists, "anarcho"-capitalists

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have no problem with factory fascism (i.e. wage labour), a position which

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seems highly illogical for a theory calling itself libertarian. If it

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were truly libertarian, it would oppose all forms of domination, not

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just statism. This position flows from the "anarcho"-capitalist

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definition of freedom as the absence of coercion and will be discussed

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in section 2 in more detail.

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Of course, Rothbard has yet another means to escape the obvious, namely

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that the market will limit the abuses of the property owners. If workers

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do not like their ruler then they can seek another. However, this reply

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completely ignores the reality of economic and social power. Thus the

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"consent" argument fails because it ignores the social circumstances of

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capitalism which limit the choice of the many. Anarchists have long argued

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that, as a class, workers have little choice but to "consent" to capitalist

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hierarchy. The alternative is either dire poverty or starvation.

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"Anarcho"-capitalists dismiss such claims by denying that there is such a

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thing as economic power. Rather, it is simply freedom of contract. Anarchists

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consider such claims as a joke. To show why, we need only quote (yet again)

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Rothbard on the abolition of slavery and serfdom in the 19th century. He

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argued, correctly, that the "*bodies* of the oppressed were freed, but the

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property which they had worked and eminently deserved to own, remained in

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the hands of their former oppressors. With economic power thus remaining

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in their hands, the former lords soon found themselves virtual masters

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once more of what were now free tenants or farm labourers. The serfs and

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slaves had tasted freedom, but had been cruelly derived of its fruits."

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[Op. Cit., p. 74]

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To say the least, anarchists fail to see the logic in this position. Contrast

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this with the standard "anarcho"-capitalist claim that if market forces

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("voluntary exchanges") result in the creation of "free tenants or farm

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labourers" then they are free. Yet labourers dispossessed by market forces

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are in exactly the same social and economic situation as the ex-serfs and

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ex-slaves. If the latter do not have the fruits of freedom, neither do

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the former. Rothbard sees the obvious "economic power" in the latter case,

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but denies it in the former. It is only Rothbard's ideology that stops

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him from drawing the obvious conclusion -- identical economic conditions

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produce identical social relationships and so capitalism is marked by

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"economic power" and "virtual masters." The only solution is for

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"anarcho"-capitalists to simply say the ex-serfs and ex-slaves were

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actually free to choose and, consequently, Rothbard was wrong. It might

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be inhuman, but at least it would be consistent!

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Rothbard's perspective is alien to anarchism. For example, as

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individualist anarchist William Bailie noted, under capitalism

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there is a class system marked by "a dependent industrial class of

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wage-workers" and "a privileged class of wealth-monopolisers, each

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becoming more and more distinct from the other as capitalism advances."

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This has turned property into "a social power, an economic force

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destructive of rights, a fertile source of injustice, a means of

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enslaving the dispossessed." He concludes: "Under this system equal

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liberty cannot obtain." Bailie notes that the modern "industrial

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world under capitalistic conditions" have "arisen under the *regime*

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of status" (and so "law-made privileges") however, it seems unlikely

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that he would have concluded that such a class system would be fine

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if it had developed naturally or the current state was abolished

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while leaving the class structure intact (as we note in section G.4,

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Tucker recognised that even the "freest competition" was powerless

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against the "enormous concentration of wealth" associated with modern

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capitalism). [_The Individualist Anarchists_, p. 121]

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Therefore anarchists recognise that "free exchange" or "consent" in

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unequal circumstances will reduce freedom as well as increasing inequality

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between individuals and classes. In other words, as we discuss in

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section 3, inequality will produce social relationships which are based on

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hierarchy and domination, *not* freedom. As Noam Chomsky put it:

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"Anarcho-capitalism, in my opinion, is a doctrinal system which, if ever

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implemented, would lead to forms of tyranny and oppression that have few

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counterparts in human history. There isn't the slightest possibility that

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its (in my view, horrendous) ideas would be implemented, because they would

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quickly destroy any society that made this colossal error. The idea of 'free

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contract' between the potentate and his starving subject is a sick joke,

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perhaps worth some moments in an academic seminar exploring the consequences

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of (in my view, absurd) ideas, but nowhere else." [_Noam Chomsky on

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Anarchism_, interview with Tom Lane, December 23, 1996]

456

457

Clearly, then, by its own arguments "anarcho"-capitalism is not anarchist.

458

This should come as no surprise to anarchists. Anarchism, as a political

459

theory, was born when Proudhon wrote _What is Property?_ specifically to

460

refute the notion that workers are free when capitalist property forces

461

them to seek employment by landlords and capitalists. He was well aware

462

that in such circumstances property "violates equality by the rights of

463

exclusion and increase, and freedom by despotism . . . [and has] perfect

464

identity with robbery." He, unsurprisingly, talks of the "proprietor, to

465

whom [the worker] has sold and surrendered his liberty." For Proudhon,

466

anarchy was "the absence of a master, of a sovereign" while "proprietor"

467

was "synonymous" with "sovereign" for he "imposes his will as law, and

468

suffers neither contradiction nor control." This meant that "property

469

engenders despotism," as "each proprietor is sovereign lord within the

470

sphere of his property." [_What is Property_, p. 251, p. 130, p. 264

471

and pp. 266-7] It must also be stressed that Proudhon's classic work is

472

a lengthy critique of the kind of apologetics for private property

473

Rothbard espouses to salvage his ideology from its obvious contradictions.

474

475

Ironically, Rothbard repeats the same analysis as Proudhon but draws

476

the *opposite* conclusions and expects to be considered an anarchist!

477

Moreover, it seems equally ironic that "anarcho"-capitalism calls itself

478

"anarchist" while basing itself on the arguments that anarchism was

479

created in opposition to. As shown, "anarcho"-capitalism makes as much

480

sense as "anarcho-statism" -- an oxymoron, a contradiction in terms. The

481

idea that "anarcho"-capitalism warrants the name "anarchist" is simply

482

false. Only someone ignorant of anarchism could maintain such a thing.

483

While you expect anarchist theory to show this to be the case, the

484

wonderful thing is that "anarcho"-capitalism itself does the same.

485

486

Little wonder Bob Black argues that "[t]o demonise state authoritarianism

487

while ignoring identical albeit contract-consecrated subservient arrangements

488

in the large-scale corporations which control the world economy is fetishism

489

at its worst." [_Libertarian as Conservative_] The similarities between

490

capitalism and statism are clear -- and so why "anarcho"-capitalism cannot

491

be anarchist. To reject the authority (the "ultimate decision-making power")

492

of the state and embrace that of the property owner indicates not only a

493

highly illogical stance but one at odds with the basic principles of anarchism.

494

This whole-hearted support for wage labour and capitalist property rights

495

indicates that "anarcho"-capitalists are not anarchists because they do

496

not reject all forms of *archy.* They obviously support the hierarchy

497

between boss and worker (wage labour) and landlord and tenant. Anarchism,

498

by definition, is against all forms of archy, including the hierarchy

499

generated by capitalist property. To ignore the obvious archy associated

500

with capitalist property is highly illogical.

501

502

In addition, we must note that such inequalities in power and wealth

503

will need "defending" from those subject to them ("anarcho"-capitalists

504

recognise the need for private police and courts to defend property

505

from theft -- and, anarchists add, to defend the theft and despotism

506

associated with property!). Due to its support of private property (and

507

thus authority), "anarcho"-capitalism ends up retaining a state in its

508

"anarchy"; namely a *private* state whose existence its proponents

509

attempt to deny simply by refusing to call it a state, like an ostrich

510

hiding its head in the sand (see section 6 for more on this and why

511

"anarcho"-capitalism is better described as "private state" capitalism).

512

As Albert Meltzer put it:

513

514

"Common-sense shows that any capitalist society might dispense with

515

a 'State' . . . but it could not dispense with organised government,

516

or a privatised form of it, if there were people amassing money and

517

others working to amass it for them. The philosophy of 'anarcho-capitalism'

518

dreamed up by the 'libertarian' New Right, has nothing to do with

519

Anarchism as known by the Anarchist movement proper. It is a lie

520

. . . Patently unbridled capitalism . . . needs some force at its

521

disposal to maintain class privileges, either form the State itself

522

or from private armies. What they believe in is in fact a limited

523

State -- that us, one in which the State has one function, to protect

524

the ruling class, does not interfere with exploitation, and comes as

525

cheap as possible for the ruling class. The idea also serves another

526

purpose . . . a moral justification for bourgeois consciences in

527

avoiding taxes without feeling guilty about it." [_Anarchism:

528

Arguments For and Against_, p. 50]

529

530

For anarchists, this need of capitalism for some kind of state is

531

unsurprising. For "Anarchy without socialism seems equally as impossible

532

to us [as socialism without anarchy], for in such a case it could not be

533

other than the domination of the strongest, and would therefore set in

534

motion right away the organisation and consolidation of this domination;

535

that is to the constitution of government." [Errico Malatesta, _Life and

536

Ideas_, p. 148] Because of this, the "anarcho"-capitalist rejection of

537

anarchist ideas on capitalist property economics and the need for

538

equality, they cannot be considered anarchists or part of the anarchist

539

tradition.

540

541

Thus anarchism is far more than the common dictionary definition

542

of "no government" -- it also entails being against all forms of

543

*archy*, including those generated by capitalist property. This

544

is clear from the roots of the word "anarchy." As we noted

545

in section A.1, the word anarchy means "no rulers" or "contrary

546

to authority." As Rothbard himself acknowledges, the property

547

owner is the ruler of their property and, therefore, those who

548

use it. For this reason "anarcho"-capitalism cannot be considered as

549

a form of anarchism -- a real anarchist must logically oppose

550

the authority of the property owner along with that of the state.

551

As "anarcho"-capitalism does not explicitly (or implicitly, for

552

that matter) call for economic arrangements that will end wage

553

labour and usury it cannot be considered anarchist or part of the

554

anarchist tradition.

555

556

Political theories should be identified by their actual features and

557

history rather than labels. Once we recognise that, we soon find out that

558

"anarcho"-capitalism is an oxymoron. Anarchists and "anarcho"-capitalists

559

are not part of the same movement or tradition. Their ideas and aims

560

are in direct opposition to those of all kinds of anarchists.

561

562

While anarchists have always opposed capitalism, "anarcho"-capitalists

563

have embraced it. And due to this embrace their "anarchy" will be marked

564

by extensive differences in wealth and power, differences that will show

565

themselves up in relationships based upon subordination and hierarchy

566

(such as wage labour), *not* freedom (little wonder that Proudhon

567

argued that "property is despotism" -- it creates authoritarian and

568

hierarchical relationships between people in a similar way to statism).

569

570

Their support for "free market" capitalism ignores the impact of wealth

571

and power on the nature and outcome of individual decisions within the

572

market (see sections 2 and 3 for further discussion). For example,

573

as we indicate in sections J.5.10, J.5.11 and J.5.12, wage labour is less

574

efficient than self-management in production but due to the structure and

575

dynamics of the capitalist market, "market forces" will actively discourage

576

self-management due to its empowering nature for workers. In other words,

577

a developed capitalist market will promote hierarchy and unfreedom in

578

production in spite of its effects on individual workers and their

579

wants (see also section 10.2). Thus "free market" capitalism tends

580

to re-enforce inequalities of wealth and power, *not* eliminate them.

581

582

Furthermore, any such system of (economic and social) power will require

583

extensive force to maintain it and the "anarcho"-capitalist system of

584

competing "defence firms" will simply be a new state, enforcing

585

capitalist power, property rights and law.

586

587

Overall, the lack of concern for meaningful freedom within production and

588

the effects of vast differences in power and wealth within society as a

589

whole makes "anarcho"-capitalism little better than "anarchism for the rich."

590

Emma Goldman recognised this when she argued that "'Rugged individualism'

591

has meant all the 'individualism' for the masters . . . in whose name

592

political tyranny and social oppression are defended and held up as

593

virtues while every aspiration and attempt of man to gain freedom . . .

594

is denounced as . . . evil in the name of that same individualism."

595

[_Red Emma Speaks_, p. 112] And, as such, is no anarchism at all.

596

597

So, unlike anarchists, "anarcho"-capitalists do not seek the "abolition

598

of the proletariat" (to use Proudhon's expression) via changing capitalist

599

property rights and institutions. Thus the "anarcho"-capitalist and the

600

anarchist have different starting positions and opposite ends in mind

601

and so they cannot be considered part of the same (anarchist) tradition.

602

As we discuss further in later sections, the "anarcho"-capitalist

603

claims to being anarchists are bogus simply because they reject so much

604

of the anarchist tradition as to make what they do accept non-anarchist

605

in theory and practice. Little wonder Peter Marshall said that "few

606

anarchists would accept the 'anarcho-capitalists' into the anarchist

607

camp since they do not share a concern for economic equality and

608

social justice." [_Demanding the Impossible_, p. 565]

609

610

1.1 Why is the failure to renounce hierarchy the Achilles Heel of

611

right-wing libertarianism and "anarcho"-capitalism?

612

613

Any capitalist system will produce vast differences in economic (and social)

614

wealth and power. As we argue in section 3.1, such differences will

615

reflect themselves in the market and any "free" contracts agreed there

616

will create hierarchical relationships. Thus capitalism is marked by

617

hierarchy (see section B.1.2) and, unsurprisingly, right-libertarians

618

and "anarcho"-capitalists fail to oppose such "free market" generated

619

hierarchy.

620

621

Both groups approve of it in the capitalist workplace or rented accommodation

622

and the right-Libertarians also approve of it in a 'minimal' state to protect

623

private property ("anarcho"-capitalists, in contrast, approve of the use

624

of private defence firms to protect property). But the failure of these

625

two movements to renounce hierarchy is their weakest point. For

626

anti-authoritarianism has sunk deep roots into the modern psyche,

627

as a legacy of the sixties.

628

629

Many people who do not even know what anarchism is have been profoundly

630

affected by the personal liberation and counterculture movements of the

631

past thirty years, epitomised by the popular bumper sticker, "Question

632

Authority." As a result, society now tolerates much more choice than ever

633

before in matters of religion, sexuality, art, music, clothing, and other

634

components of lifestyle. We need only recall the conservatism that reigned

635

in such areas during the fifties to see that the idea of liberty has made

636

tremendous advances in just a few decades.

637

638

Although this liberatory impulse has so far been confined almost entirely

639

to the personal and cultural realms, it may yet be capable of spilling

640

over and affecting economic and political institutions, provided it

641

continues to grow. The Right is well aware of this, as seen in its ongoing

642

campaigns for "family values," school prayer, suppression of women's

643

rights, fundamentalist Christianity, sexual abstinence before marriage,

644

and other attempts to revive the Ozzie-and-Harriet mindset of the Good Old

645

Days. This is where the efforts of "cultural anarchists" -- artists,

646

musicians, poets, and others -- are important in keeping alive the ideal

647

of personal freedom and resistance to authority as a necessary foundation

648

for economic and political restructuring.

649

650

Indeed, the libertarian right (as a whole) support restrictions on freedom

651

*as long as its not the state that is doing it*! Their support for

652

capitalism means that they have no problem with bosses dictating what

653

workers do during working hours (nor outside working hours, if the job

654

requires employees to take drug tests or not be gay in order to keep it).

655

If a private landlord or company decrees a mandatory rule or mode of

656

living, workers/tenets must "love it or leave it!" Of course, that the

657

same argument also applies to state laws is one hotly denied by

658

right-Libertarians -- a definite case of not seeing the wood for the

659

trees (see section 2.3).

660

661

Of course, the "anarcho"-capitalist will argue, workers and tenants can

662

find a more liberal boss or landlord. This, however, ignores two key facts.

663

Firstly, being able to move to a more liberal state hardly makes state

664

laws less offensive (as they themselves will be the first to point out).

665

Secondly, looking for a new job or home is not that easy. Just a moving

666

to a new state can involve drastic upheavals, so change changing jobs

667

and homes. Moreover, the job market is usually a buyers market (it has

668

to be in capitalism, otherwise profits are squeezed -- see sections C.7

669

and 10.2) and this means that workers are not usually in a position

670

(unless they organise) to demand increased liberties at work.

671

672

It seems somewhat ironic, to say the least, that right-libertarians

673

place rights of property over the rights of self-ownership, even though

674

(according to their ideology) self-ownership is the foundational right

675

from which property rights are derived. Thus in right-libertarianism the

676

rights of property owners to discriminate and govern the property-less

677

are more important than the freedom from discrimination (i.e. to be

678

yourself) or the freedom to govern oneself at all times.

679

680

So, when it boils down to it, right-libertarians are not really bothered

681

about restrictions on liberty and, indeed, they will defend private

682

restrictions on liberty with all their might. This may seem a strange

683

position for self-proclaimed "libertarians" to take, but it flows

684

naturally from their definition of freedom (see section 2 for a

685

full discussion of this). but by not attacking hierarchy beyond certain

686

forms of statism, the 'libertarian' right fundamentally undermines its

687

claim to be libertarian. Freedom cannot be compartmentalised, but is

688

holistic. The denial of liberty in, say, the workplace, quickly results

689

in its being denied elsewhere in society (due to the impact of the

690

inequalities it would produce) , just as the degrading effects of wage

691

labour and the hierarchies with which is it bound up are felt by the worker

692

outside work.

693

694

Neither the Libertarian Party nor so-called "anarcho"-capitalism is

695

*genuinely* anti-authoritarian, as those who are truly dedicated to

696

liberty must be.

697

698

1.2 How libertarian is right-Libertarian theory?

699

700

The short answer is, not very. Liberty not only implies but also requires

701

independent, critical thought (indeed, anarchists would argue that critical

702

thought requires free development and evolution and that it is precisely

703

*this* which capitalist hierarchy crushes). For anarchists a libertarian

704

theory, if it is to be worthy of the name, must be based upon critical

705

thought and reflect the key aspect that characterises life - change and the

706

ability to evolve. To hold up dogma and base "theory" upon assumptions (as

707

opposed to facts) is the opposite of a libertarian frame of mind. A

708

libertarian theory must be based upon reality and recognise the need

709

for change and the existence of change. Unfortunately, right-Libertarianism

710

is marked more by ideology than critical analysis.

711

712

Right-Libertarianism is characterised by a strong tendency of creating

713

theories based upon assumptions and deductions from these axioms (for a

714

discussion on the pre-scientific nature of this methodology and of its

715

dangers, see the next section). Robert Nozick, for example, in _Anarchy,

716

State, and Utopia_ makes no attempt to provide a justification of the

717

property rights his whole theory is based upon. His main assumption is

718

that "[i]ndividuals have rights, and there are certain things no person

719

or group may do to them (without violating their rights)." [_Anarchy,

720

State and Utopia_, p. ix] While this does have its intuitive appeal,

721

it is not much to base a political ideology upon. After all, what rights

722

people consider as valid can be pretty subjective and have constantly

723

evolved during history. To say that "individuals have rights" is to open up

724

the question "what rights?" Indeed, as we argue in greater length in section

725

2, such a rights based system as Nozick desires can and does lead to

726

situations developing in which people "consent" to be exploited and

727

oppressed and that, intuitively, many people consider supporting the

728

"violation" of these "certain rights" (by creating other ones) simply

729

because of their evil consequences.

730

731

In other words, starting from the assumption "people have [certain] rights"

732

Nozick constructs a theory which, when faced with the reality of unfreedom

733

and domination it would create for the many, justifies this unfreedom

734

as an expression of liberty. In other words, regardless of the outcome,

735

the initial assumptions are what matter. Nozick's intuitive rights system

736

can lead to some very non-intuitive outcomes.

737

738

And does Nozick prove the theory of property rights he assumes? He states

739

that "we shall not formulate [it] here." [Op. Cit., p. 150] Moreover, it

740

is not formulated anywhere else in his book. And if it is not formulated,

741

what is there to defend? Surely this means that his Libertarianism is

742

without foundations? As Jonathan Wolff notes, Nozick's "Libertarian property

743

rights remain substantially undefended." [_Robert Nozick: Property, Justice

744

and the Minimal State_, p. 117] Given that the right to acquire property

745

is critical to his whole theory you would think it important enough to go

746

into in some detail (or at least document). After all, unless he provides us

747

with a firm basis for property rights then his entitlement theory is nonsense

748

as no one has the right to (private) property.

749

750

It could be argued that Nozick *does* present enough information to allow

751

us to piece together a possible argument in favour of property rights

752

based on his modification of the "Lockean Proviso" (although he does

753

not point us to these arguments). However, assuming this is the case,

754

such a defence actually fails (see section B.3.4 for more on this). If

755

individuals *do* have rights, these rights do not include property rights

756

in the form Nozick assumes (but does not prove). Nozick appears initially

757

convincing because what he assumes with regards to property is a normal

758

feature of the society we are in (we would be forgiven when we note here

759

that feeble arguments pass for convincing when they are on the same side

760

as the prevailing sentiment).

761

762

Similarly, both Murray Rothbard and Ayn Rand (who is infamous for repeating

763

"A is A" ad infinitum) do the same - base their ideologies on assumptions

764

(see section 11 for more on this).

765

766

Therefore, we see that most of the leading right-Libertarian ideologues

767

base themselves on assumptions about what "Man" is or the rights they

768

should have (usually in the form that people have (certain) rights because

769

they are people). From these theorems and assumptions they build their

770

respective ideologies, using logic to deduce the conclusions that their

771

assumptions imply. Such a methodology is unscientific and, indeed, a relic

772

of religious (pre-scientific) society (see next section) but, more

773

importantly, can have negative effects on maximising liberty. This is

774

because this "methodology" has distinct problems. Murray Bookchin

775

argues:

776

777

"Conventional reason rests on identity, not change; its fundamental

778

principle is that *A equals A,* the famous 'principle of identity,' which

779

means that any given phenomenon can be only itself and cannot be other than

780

what we immediately perceive it to be at a given moment in time. It does not

781

address the problem of change. A human being is an infant at one time, a

782

child at another, an adolescent at still another, and finally a youth and

783

an adult. When we analyse an infant by means of conventional reason, we

784

are not exploring what it is *becoming* in the process of developing into

785

a child." ["A Philosophical Naturalism", _Society and Nature_, No.2, p. 64]

786

787

In other words, right-Libertarian theory is based upon ignoring the

788

fundamental aspect of life - namely *change* and *evolution.* Perhaps

789

it will be argued that identity also accounts for change by including

790

potentiality -- which means, that we have the strange situation that

791

A can *potentially* be A! If A is not actually A, but only has the

792

potential to be A, then A is not A. Thus to include change is to

793

acknowledge that A does not equal A -- that individuals and humanity

794

evolves and so what constitutes A also changes. To maintain identity

795

and then to deny it seems strange.

796

797

That change is far from the "A is A" mentality can be seen from Murray

798

Rothbard who goes so far as to state that "one of the notable attributes

799

of natural law" is "its applicability to all men [sic!], regardless of

800

time or place. Thus ethical law takes its place alongside physical or

801

'scientific' natural laws." [_The Ethics of Liberty_, p. 42] Apparently

802

the "nature of man" is the only living thing in nature that does not evolve

803

or change! Of course, it could be argued that by "natural law" Rothbard is

804

only referring to his method of deducing his (and, we stress, they are

805

just his -- not natural) "ethical laws" -- but his methodology starts

806

by assuming certain things about "man." Whether these assumptions seem

807

far or not is besides the point, by using the term "natural law" Rothbard

808

is arguing that any actions that violate *his* ethical laws are somehow

809

"against nature" (but if they were against nature, they could not occur

810

Procrustean bed for humanity (as Rothbard's ideology shows).

811

812

So, as can be seen, many leading right-Libertarians place great store

813

by the axiom "A is A" or that "man" has certain rights simply because

814

"he" is a "man". And as Bookchin points out, such conventional reason

815

"doubtless plays an indispensable role in mathematical thinking and

816

mathematical sciences . . . and in the nuts-and-bolts of dealing with

817

everyday life" and so is essential to "understand or design mechanical

818

entities." [Ibid., p.67] But the question arises, is such reason

819

useful when considering people and other forms of life?

820

821

Mechanical entities are but one (small) aspect of human life. Unfortunately

822

for right-Libertarians (and fortunately for the rest of humanity), human

823

beings are *not* mechanical entities but instead are living, breathing,

824

feeling, hoping, dreaming, *changing* living organisms. They are not

825

mechanical entities and any theory that uses reason based on such

826

(non-living) entities will flounder when faced with living ones. In

827

other words, right-Libertarian theory treats people as the capitalist

828

system tries to -- namely as commodities, as things. Instead of human

829

beings, whose ideas, ideals and ethics change, develop and grow, capitalism

830

and capitalist ideologues try to reduce human life to the level of corn or

831

iron (by emphasising the unchanging "nature" of man and their starting

832

assumptions/rights).

833

834

This can be seen from their support for wage labour, the reduction of

835

human activity to a commodity on the market. While paying lip service

836

to liberty and life, right-libertarianism justifies the commodification

837

of labour and life, which within a system of capitalist property rights

838

can result in the treating of people as means to an end as opposed

839

to an end in themselves (see sections 2 and 3.1).

840

841

And as Bookchin points out, "in an age of sharply conflicting values and

842

emotionally charges ideals, such a way of reasoning is often repellent.

843

Dogmatism, authoritarianism, and fear seem all-pervasive." [Ibid., p. 68]

844

Right-Libertarianism provides more than enough evidence for Bookchin's

845

summary with its support for authoritarian social relationships, hierarchy

846

and even slavery (see section 2).

847

848

This mechanical viewpoint is also reflected in their lack of appreciation

849

that social institutions and relationships evolve over time and, sometimes,

850

fundamentally change. This can best be seen from property. Right-libertarians

851

fail to see that over time (in the words of Proudhon) property "changed

852

its nature." Originally, "the word *property* was synonymous with . . .

853

*individual possession*" but it became more "complex" and turned into

854

*private property* -- "the right to use it by his neighbour's labour."

855

The changing of use-rights to (capitalist) property rights created relations

856

of domination and exploitation between people absent before. For the

857

right-Libertarian, both the tools of the self-employed artisan and the

858

capital of a transnational corporation are both forms of "property" and

859

(so) basically identical. In practice, of course, the social relations

860

they create and the impact they have on society are totally different.

861

Thus the mechanical mind-set of right-Libertarianism fails to understand

862

how institutions, like property, evolve and come to replace whatever

863

freedom enhancing features they had with oppression (indeed, von Mises

864

argued that "[t]here may possibly be a difference of opinion about

865

whether a particular institution is socially beneficial or harmful. But

866

once it has been judged [by whom, we ask] beneficial, one can no longer

867

contend that, for some inexplicable reason, it must be condemned as

868

immoral." [_Liberalism_, p. 34] So much for evolution and change!).

869

870

Anarchism, in contrast, is based upon the importance of critical thought

871

informed by an awareness that life is in a constant process of change. This

872

means that our ideas on human society must be informed by the facts, not by

873

what we wish was true. For Bookchin, an evaluation of conventional wisdom

874

(as expressed in "the law of identity") is essential and its conclusions

875

have "enormous importance for how we behave as ethical beings, the nature

876

of nature, and our place in the natural world. Moreover. . . these issues

877

directly affect the kind of society, sensibility, and lifeways we wish to

878

foster." [Bookchin, Op. Cit., pp. 69-70]

879

880

Bookchin is correct. While anarchists oppose hierarchy in the name of

881

liberty, right-libertarians support authority and hierarchy, all of which

882

deny freedom and restrict individual development. This is unsurprising

883

because the right-libertarian ideology rejects change and critical thought

884

based upon the scientific method and so is fundamentally *anti-life* in

885

its assumptions and *anti-human* in its method. Far from being a libertarian

886

set of ideas, right-Libertarianism is a mechanical set of dogmas that deny

887

the fundamental nature of life (namely change) and of individuality (namely

888

critical thought and freedom). Moreover, in practice their system of

889

(capitalist) rights would soon result in extensive restrictions on liberty

890

and authoritarian social relationships (see sections 2 and 3) -- a

891

strange result of a theory proclaiming itself "libertarian" but one

892

consistent with its methodology.

893

894

From a wider viewpoint, such a rejection of liberty by right-libertarians

895

is unsurprising. They do, after all, support capitalism. Capitalism

896

produces an inverted set of ethics, one in which capital (dead labour) is

897

more important that people (living labour). After all, workers are usually

898

easier to replace than investments in capital and the person who owns

899

capital commands the person who "only" owns his life and productive

900

abilities. And as Oscar Wilde once noted, crimes against property "are

901

the crimes that the English law, valuing what a man has more than what

902

a man is, punishes with the harshest and most horrible severity." [_The

903

Soul of Man Under Socialism_, p. 1182]

904

905

This mentality is reflected in right-libertarianism when it claims that

906

stealing food is a crime while starving to death (due to the action of

907

market forces/power and property rights) is no infringement of your rights

908

(see section 4.2 for a similar argument with regards to water). It can

909

also be seen when right-libertarian's claim that the taxation "of earnings

910

from labour" (e.g. of one dollar from a millionaire) is "*on a par with*

911

forced labour" [Nozick, Op. Cit., p. 169] while working in a sweatshop

912

for 14 hours a day (enriching said millionaire) does not affect your

913

liberty as you "consent" to it due to market forces (although, of course,

914

many rich people have earned their money *without* labouring themselves --

915

their earnings derive from the wage labour of others so would taxing

916

those, non-labour, earnings be "forced labour"?) Interestingly, the

917

Individualist Anarchist Ben Tucker argued that an income tax was "a

918

recognition of the fact that industrial freedom and equality of

919

opportunity no longer exist here [in the USA in the 1890s] even in

920

the imperfect state in which they once did exist" [quoted by James

921

Martin, _Men Against the State_, p. 263] which suggests a somewhat

922

different viewpoint on this matter than Nozick or Rothbard.

923

924

That capitalism produces an inverted set of ethics can be seen when the

925

Ford produced the Pinto. The Pinto had a flaw in it which meant that if

926

it was hit in a certain way in a crash the fuel tank exploded. The Ford

927

company decided it was more "economically viable" to produce that car and

928

pay damages to those who were injured or the relatives of those who died

929

than pay to change the invested capital. The needs for the owners of

930

capital to make a profit came before the needs of the living. Similarly,

931

bosses often hire people to perform unsafe work in dangerous conditions

932

and fire them if they protest. Right-libertarian ideology is the

933

philosophical equivalent. Its dogma is "capital" and it comes before

934

life (i.e. "labour").

935

936

As Bakunin once put it, "you will always find the idealists in the very

937

act of practical materialism, while you will see the materialists pursuing

938

and realising the most grandly ideal aspirations and thoughts." [_God

939

and the State_, p. 49] Hence we see right "libertarians" supporting

940

sweat shops and opposing taxation -- for, in the end, money (and the

941

power that goes with it) counts far more in that ideology than ideals

942

such as liberty, individual dignity, empowering, creative and productive

943

work and so forth for all. The central flaw of right-libertarianism is

944

that it does not recognise that the workings of the capitalist market can

945

easily ensure that the majority end up becoming a resource for others in

946

ways far worse than that associated with taxation. The legal rights

947

of self-ownership supported by right-libertarians does not mean that

948

people have the ability to avoid what is in effect enslavement to

949

another (see sections 2 and 3).

950

951

Right-Libertarian theory is not based upon a libertarian methodology or

952

perspective and so it is hardly surprising it results in support for

953

authoritarian social relationships and, indeed, slavery (see section

954

2.6).

955

956

1.3 Is right-Libertarian theory scientific in nature?

957

958

Usually, no. The scientific approach is *inductive,* much of the

959

right-libertarian approach is *deductive.* The first draws generalisations

960

from the data, the second applies preconceived generalisations to the data.

961

A completely deductive approach is pre-scientific, however, which is why

962

many right-Libertarians cannot legitimately claim to use a scientific

963

method. Deduction does occur in science, but the generalisations are

964

primarily based on other data, not *a priori* assumptions, and are checked

965

against data to see if they are accurate. Anarchists tend to fall into the

966

inductive camp, as Kropotkin put it:

967

968

"Precisely this natural-scientific method applied to economic facts,

969

enables us to prove that the so-called 'laws' of middle-class sociology,

970

including also their political economy, are not laws at all, but

971

simply guesses, or mere assertions which have never been verified

972

at all." [_Kropotkin's Revolutionary Pamphlets_, p. 153]

973

974

The idea that natural-scientific methods can be applied to economic and

975

social life is one that many right-libertarians reject. Instead they

976

favour the deductive (pre-scientific) approach (this we must note is

977

not limited purely to Austrian economists, many more mainstream

978

capitalist economists also embrace deduction over induction).

979

980

The tendency for right-Libertarianism to fall into dogmatism (or *a priori*

981

theorems, as they call it) and its implications can best be seen from the

982

work of Ludwig von Mises and other economists from the right-Libertarian

983

"Austrian school." Of course, not all right-libertarians necessarily

984

subscribe to this approach (Murray Rothbard for one did) but its use by

985

so many leading lights of both schools of thought is significant and

986

worthy of comment. And as we are concentrating on *methodology* it is

987

not essential to discuss the starting assumptions. The assumptions (such

988

as, to use Rothbard's words, the Austrian's "fundamental axiom that

989

individual human beings act") may be correct, incorrect or incomplete --

990

but the method of using them advocated by von Mises ensures that such

991

considerations are irrelevant.

992

993

Von Mises (a leading member of the Austrian school of economics) begins by

994

noting that social and economic theory "is not derived from experience; it

995

is prior to experience..." Which is back to front. It is obvious that

996

experience of capitalism is necessary in order to develop a viable theory

997

about how it works. Without the experience, any theory is just a flight of

998

fantasy. The actual specific theory we develop is therefore derived from

999

experience, informed by it and will have to get checked against reality

1000

to see if it is viable. This is the scientific method - any theory must

1001

be checked against the facts. However, von Mises goes on to argue at length

1002

that "no kind of experience can ever force us to discard or modify *a priori*

1003

theorems; they are logically prior to it and cannot be either proved by

1004

corroborative experience or disproved by experience to the contrary . . ."

1005

1006

And if this does not do justice to a full exposition of the phantasmagoria

1007

of von Mises' *a priorism*, the reader may take some joy (or horror) from

1008

the following statement:

1009

1010

"If a contradiction appears between a theory and experience, *we must

1011

always assume* that a condition pre-supposed by the theory was not

1012

present, or else there is some error in our observation. The disagreement

1013

between the theory and the facts of experience frequently forces us to think

1014

through the problems of the theory again. *But so long as a rethinking of

1015

the theory uncovers no errors in our thinking, we are not entitled to doubt

1016

its truth*" [emphasis added -- the quotes presented here are cited

1017

in _Ideology and Method in Economics_ by Homa Katouzian, pp. 39-40]

1018

1019

In other words, if reality is in conflict with your ideas, do not adjust

1020

your views because reality must be at fault! The scientific method would

1021

be to revise the theory in light of the facts. It is not scientific to

1022

reject the facts in light of the theory! This anti-scientific perspective

1023

is at the heart of his economics as experience "can never . . . prove or

1024

disprove any particular theorem":

1025

1026

"What assigns economics to its peculiar and unique position in the

1027

orbit of pure knowledge and of the practical utilisation of knowledge

1028

is the fact that its particular theorems are not open to any verification

1029

or falsification on the grounds of experience . . .. . . The ultimate

1030

yardstick of an economic theorem's correctness or incorrectness is solely

1031

reason unaided by experience." [_Human Action_, p. 858]

1032

1033

Von Mises rejects the scientific approach as do all Austrian Economists.

1034

Murray Rothbard states approvingly that "Mises indeed held not only that

1035

economic theory does not need to be 'tested' by historical fact but also

1036

that it *cannot* be so tested." ["Praxeology: The Methodology of Austrian

1037

Economics" in _The Foundation of Modern Austrian Economics_, p. 32]

1038

Similarly, von Hayek wrote that economic theories can "never be verified

1039

or falsified by reference to facts. All that we can and must verify is the

1040

presence of our assumptions in the particular case." [_Individualism and

1041

Economic Order_, p. 73]

1042

1043

This may seen somewhat strange to non-Austrians. How can we ignore reality

1044

when deciding whether a theory is a good one or not? If we cannot evaluate

1045

our ideas, how can we consider them anything bar dogma? The Austrian's

1046

maintain that we cannot use historical evidence because every historical

1047

situation is unique. Thus we cannot use "complex heterogeneous historical

1048

facts as if they were repeatable homogeneous facts" like those in a

1049

scientist's experiment [Rothbard, Op. Cit., p. 33]. While such a position

1050

*does* have an element of truth about it, the extreme *a priorism* that

1051

is drawn from this element is radically false (just as extreme empiricism

1052

is also false, but for different reasons).

1053

1054

Those who hold such a position ensure that their ideas cannot be evaluated

1055

beyond logical analysis. As Rothbard makes clear, "since praxeology begins

1056

with a true axiom, A, all that can be deduced from this axiom must also

1057

be true. For if A implies be, and A is true, then B must also be true."

1058

[Op. Cit., pp. 19-20] But such an approach makes the search for truth a

1059

game without rules. The Austrian economists (and other right-libertarians)

1060

who use this method are free to theorise anything they want, without such

1061

irritating constrictions as facts, statistics, data, history or experimental

1062

confirmation. Their only guide is logic. But this is no different from what

1063

religions do when they assert the logical existence of God. Theories

1064

ungrounded in facts and data are easily spun into any belief a person

1065

wants. Starting assumptions and trains of logic may contain inaccuracies

1066

so small as to be undetectable, yet will yield entirely false conclusions.

1067

1068

In addition, trains of logic may miss things which are only brought

1069

to light by actual experiences (after all, the human mind is not all

1070

knowing or all seeing). To ignore actual experience is to loose that

1071

input when evaluating a theory. Hence our comments on the irrelevance

1072

of the assumptions used -- the methodology is such that incomplete or

1073

incorrect assumptions or steps cannot be identified in light of experience.

1074

This is because one way of discovering if a given chain of logic requires

1075

checking is to test its conclusions against available evidence (although

1076

von Mises did argue that the "ultimate yardstick" was "solely reason unaided

1077

by experience"). If we *do* take experience into account and rethink a

1078

given theory in the light of contradictory evidence, the problem

1079

remains that a given logical chain may be correct, but incomplete

1080

or concentrate on or stress inappropriate factors. In other words, our

1081

logical deductions may be correct but our starting place or steps wrong

1082

and as the facts are to be rejected in the light of the deductive method,

1083

we cannot revise our ideas.

1084

1085

Indeed, this approach could result in discarding (certain forms of) human

1086

behaviour as irrelevant (which the Austrian system claims using empirical

1087

evidence does). For there are too many variables that can have an influence

1088

upon individual acts to yield conclusive results explaining human behaviour.

1089

Indeed, the deductive approach may ignore as irrelevant certain human

1090

motivations which have a decisive impact on an outcome. There could be

1091

a strong tendency to project "right-libertarian person" onto the rest of

1092

society and history, for example, and draw inappropriate insights into the

1093

way human society works or has worked. This can be seen, for example,

1094

in attempts to claim pre-capitalist societies as examples of

1095

"anarcho"-capitalism in action.

1096

1097

Moreover, deductive reasoning cannot indicate the relative significance

1098

of assumptions or theoretical factors. That requires empirical study. It

1099

could be that a factor considered important in the theory actually turns

1100

out to have little effect in practice and so the derived axioms are so

1101

weak as to be seriously misleading.

1102

1103

In such a purely ideal realm, observation and experience are distrusted

1104

(when not ignored) and instead theory is the lodestone. Given the bias

1105

of most theorists in this tradition, it is unsurprising that this style

1106

of economics can always be trusted to produce results proving free markets

1107

to be the finest principle of social organisation. And, as an added

1108

bonus, reality can be ignored as it is *never* "pure" enough according

1109

to the assumptions required by the theory. It could be argued, because

1110

of this, that many right-libertarians insulate their theories from

1111

criticism by refusing to test them or acknowledge the results of such

1112

testing (indeed, it could also be argued that much of right-libertarianism

1113

is more a religion than a political theory as it is set-up in such a

1114

way that it is either true or false, with this being determined not

1115

by evaluating facts but by whether you accept the assumptions and

1116

logical chains presented with them).

1117

1118

Strangely enough, while dismissing the "testability" of theories many

1119

right-Libertarians (including Murray Rothbard) *do* investigate historical

1120

situations and claim them as examples of how well their ideas work in

1121

practice. But why does historical fact suddenly become useful when it

1122

can be used to bolster the right-Libertarian argument? Any such example

1123

is just as "complex" as any other and the good results indicated may

1124

not be accountable to the assumptions and steps of the theory but to other

1125

factors totally ignored by it. If economic (or other) theory is untestable

1126

then *no* conclusions can be drawn from history, including claims for the

1127

superiority of laissez-faire capitalism. You cannot have it both ways

1128

as evidence that their ideas work.

1129

1130

Perhaps the Austrian desire to investigate history is not so strange

1131

after all. Clashes with reality make a-priori deductive systems implode

1132

as the falsifications run back up the deductive changes to shatter the

1133

structure built upon the original axioms. Thus the desire to find *some*

1134

example which proves their ideology must be tremendous. However, the

1135

deductive a-priori methodology makes them unwilling to admit to being

1136

mistaken -- hence their attempts to downplay examples which refute their

1137

dogmas. Thus we have the desire for historical examples while at the same

1138

time they have extensive ideological justifications that ensure reality

1139

only enters their world-view when it agrees with them. In practice,

1140

the latter wins as real-life refuses to be boxed into their dogmas

1141

and deductions.

1142

1143

Of course it is sometimes argued that it is *complex* data that is

1144

the problem. Let use assume that this is the case. It is argued that

1145

when dealing with complex information it is impossible to use aggregate

1146

data without first having more simple assumptions (i.e. that "humans

1147

act"). Due to the complexity of the situation, it is argued, it is

1148

impossible to aggregate data because this hides the individual activities

1149

that creates it. Thus "complex" data cannot be used to invalidate

1150

assumptions or theories. Hence, according to Austrians, the axioms

1151

derived from the "simple fact" that "humans act" are the only basis

1152

for thinking about the economy.

1153

1154

Such a position is false in two ways.

1155

1156

Firstly, the aggregation of data *does* allow us to understand complex

1157

systems. If we look at a chair, we cannot find out whether it is

1158

comfortable, its colour, whether it is soft or hard by looking at

1159

the atoms that make it up. To suggest that you can is to imply the

1160

existence of green, soft, comfortable atoms. Similarly with gases.

1161

They are composed to countless individual atoms but scientists do

1162

not study them by looking at those atoms and their actions. Within

1163

limits, this is also valid for human action. For example, it would

1164

be crazy to maintain from historical data that interest rates will

1165

be a certain percentage a week but it is valid to maintain that

1166

interest rates are known to be related to certain variables in certain

1167

ways. Or that certain experiences will tend to result in certain forms

1168

of psychological damage. General tendencies and "rules of thumb" can

1169

be evolved from such study and these can be used to *guide* current

1170

practice and theory. By aggregating data you can produce valid

1171

information, rules of thumb, theories and evidence which would be

1172

lost if you concentrated on "simple data" (such as "humans act").

1173

Therefore, empirical study produces facts which vary across time

1174

and place, and yet underlying and important patterns can be

1175

generated (patterns which can be evaluated against *new* data

1176

and improved upon).

1177

1178

Secondly, the simple actions themselves influence and are influenced

1179

in turn by overall (complex) facts. People act in different ways in

1180

different circumstances (something we can agree with Austrians about,

1181

although we refuse to take it to their extreme position of rejecting

1182

empirical evidence as such). To use simple acts to understand

1183

complex systems means to miss the fact that these acts are not

1184

independent of their circumstances. For example, to claim that the

1185

capitalist market is "just" the resultant of bilateral exchanges

1186

ignores the fact that the market activity shapes the nature and

1187

form of these bilateral exchanges. The "simple" data is dependent

1188

on the "complex" system -- and so the complex system *cannot* be

1189

understood by looking at the simple actions in isolation. To do so

1190

would be to draw incomplete and misleading conclusions (and it is

1191

due to these interrelations that we argue that aggregate data should

1192

be used critically). This is particularly important when looking at

1193

capitalism, where the "simple" acts of exchange in the labour market

1194

are dependent upon and shaped by circumstances outside these acts.

1195

1196

So to claim that (complex) data cannot be used to evaluate a theory

1197

is false. Data can be useful when seeing whether a theory is confirmed by

1198

reality. This is the nature of the scientific method -- you compare the

1199

results expected by your theory to the facts and if they do not match you

1200

check your facts *and* check your theory. This may involve revising the

1201

assumptions, methodology and theories you use if the evidence is such as

1202

to bring them into question. For example, if you claim that capitalism is

1203

based on freedom but that the net result of capitalism is to produce

1204

relations of domination between people then it would be valid to revise,

1205

for example, your definition of freedom rather than deny that domination

1206

restricts freedom (see section 2 on this). But if actual experience is

1207

to be distrusted when evaluating theory, we effectively place ideology

1208

above people -- after all, how the ideology affects people in *practice*

1209

is irrelevant as experiences cannot be used to evaluate the (logically

1210

sound but actually deeply flawed) theory.

1211

1212

Moreover, there is a slight arrogance in the "Austrian" dismissal of

1213

empirical evidence. If, as they argue, the economy is just too complex

1214

to allow us to generalise from experience then how can one person

1215

comprehend it sufficiently to create an economic ideology as the

1216

Austrian's suggest? Surely no one mind (or series of minds) can

1217

produce a model which accurately reflects such a complex system? To

1218

suggest that one can deduce a theory for an exceedingly complex social

1219

system from the theoretical work based on an analysis technique which

1220

deliberately ignores that reality as being unreliable seems to require

1221

a deliberate suspension of one's reasoning faculties. Of course, it

1222

may be argued that such a task is possible, given a small enough subset

1223

of economic activity. However, such a process is sure to lead its

1224

practitioners astray as the subset is not independent of the whole

1225

and, consequently, can be influenced in ways the ideologist does not

1226

(indeed, cannot) take into account. Simply put, even the greatest mind

1227

cannot comprehend the complexities of real life and so empirical

1228

evidence needs to inform any theory seeking to describe and explain

1229

it. To reject it is simply to retreat into dogmatism and ideology,

1230

which is precisely what right-wing libertarians generally do.

1231

1232

Ultimately, this dismissal of empirical evidence seems little more

1233

than self-serving. It's utility to the ideologist is obvious. It

1234

allows them to speculate to their hearts content, building models of

1235

the economy with no bearing to reality. Their models and the conclusions

1236

it generates need never be bothered with reality -- nor the effects of

1237

their dogma. Which shows its utility to the powerful. It allows them

1238

to spout comments like "the free market benefits all" while the rich

1239

get richer and allows them to brush aside any one who points out such

1240

troublesome facts.

1241

1242

That this position is self-serving can be seen from the fact that most

1243

right libertarians are very selective about applying von Mises' argument.

1244

As a rule of thumb, it is only applied when the empirical evidence goes

1245

against capitalism. In such circumstances the fact that the current

1246

system is not a free market will also be mentioned. However, if the

1247

evidence seems to bolster the case for propertarianism then empirical

1248

evidence becomes all the rage. Needless to say, the fact that we do not

1249

have a free market will be conveniently forgotten. Depending on the

1250

needs of the moment, fundamental facts are dropped and retrieved to

1251

bolster the ideology.

1252

1253

As we indicated above (in section 1.2) and will discuss in more depth

1254

later (in section 11) most of the leading right-Libertarian theorists

1255

base themselves on such deductive methodologies, starting from assumptions

1256

and "logically" drawing conclusions from them. The religious undertones

1257

of such methodology can best be seen from the roots of right-Libertarian

1258

"Natural law" theory.

1259

1260

Carole Pateman, in her analysis of Liberal contract theory, indicates

1261

the religious nature of the "Natural Law" argument so loved by the

1262

theorists of the "Radical Right." She notes that for Locke (the main source

1263

of the Libertarian Right's Natural Law cult) "natural law" was equivalent

1264

of "God's Law" and that "God's law exists externally to and independently

1265

of individuals." [_The Problem of Political Obligation_, p. 154] No role

1266

for critical thought there, only obedience. Most modern day "Natural Law"

1267

supporters forget to mention this religious undercurrent and instead

1268

talk of about "Nature" (or "the market") as the deity that creates Law,

1269

not God, in order to appear "rational." So much for science.

1270

1271

Such a basis in dogma and religion can hardly be a firm foundation for

1272

liberty and indeed "Natural Law" is marked by a deep authoritarianism:

1273

1274

"Locke's traditional view of natural law provided individual's with an

1275

external standard which they could recognise, but which they did not

1276

voluntarily choose to order their political life." [Pateman, Op. Cit.,

1277

p. 79]

1278

1279

In Section 11 we discuss the authoritarian nature of "Natural Law"

1280

and will not do so here. However, here we must point out the political

1281

conclusions Locke draws from his ideas. In Pateman's words, Locke

1282

believed that "obedience lasts only as long as protection. His

1283

individuals are able to take action themselves to remedy their political

1284

lot. . . but this does not mean, as is often assumed, that Locke's theory

1285

gives direct support to present-day arguments for a right of civil

1286

disobedience. . . His theory allows for two alternatives only: either

1287

people go peacefully about their daily affairs under the protection of

1288

a liberal, constitutional government, or they are in revolt against a

1289

government which has ceased to be 'liberal' and has become arbitrary and

1290

tyrannical, so forfeiting its right to obedience." [Op. Cit., p. 77]

1291

1292

Locke's "rebellion" exists purely to reform a *new* 'liberal' government,

1293

not to change the existing socio-economic structure which the 'liberal'

1294

government exists to protect. His theory, therefore, indicates the results

1295

of a priorism, namely a denial of any form of social dissent which may change

1296

the "natural law" as defined by Locke. This perspective can be found in

1297

Rothbard who lambasted the individualist anarchists for arguing that

1298

juries should judge the law as well as the facts. For Rothbard, the law

1299

would be drawn up by jurists and lawyers, not ordinary people (see

1300

section 1.4 for details). The idea that those subject to laws should

1301

have a say in forming them is rejected in favour of elite rule. As

1302

von Mises put it:

1303

1304

"The flowering of human society depends on two factors: the

1305

intellectual power of outstanding men to conceive sound social

1306

and economic theories, and the ability of these or other men

1307

to make these ideologies palatable to the majority" [_Human

1308

Action_, p. 864]

1309

1310

Yet such a task would require massive propaganda work and would only,

1311

ultimately, succeed by removing the majority from any say in the

1312

running of society. Once that is done then we have to believe that

1313

the ruling elite will be altruistic in the extreme and not abuse

1314

their position to create laws and processes which defended what

1315

*they* thought was "legitimate" property, property rights and what

1316

constitutes "aggression." Which, ironically, contradicts the key

1317

capitalist notion that people are driven by self-gain. The obvious

1318

conclusion from such argument is that any right-libertarian regime

1319

would have to exclude change. If people can change the regime they

1320

are under they may change it in ways that right libertarian's do

1321

not support. The provision for ending amendments to the regime or

1322

the law would effectively ban most opposition groups or parties

1323

as, by definition, they could do nothing once in office (for

1324

minimal state "libertarians") or in the market for "defence"

1325

agencies (for "anarcho"-capitalists). How this differs from a

1326

dictatorship is hard to say -- after all, most dictatorships have

1327

parliamentary bodies which have no power but which can talk a lot.

1328

Perhaps the knowledge that it is *private* police enforcing *private*

1329

power will make those subject to the regime maximise their utility

1330

by keeping quiet and not protesting. Given this, von Mises' praise

1331

for fascism in the 1920s may be less contradictory than it first

1332

appears (see section 6.5) as it successfully "deterred democracy"

1333

by crushing the labour, socialist and anarchist movements across

1334

the world.

1335

1336

So, von Mises, von Hayek and most right-libertarians reject the scientific

1337

method in favour of ideological correctness -- if the facts contradict your

1338

theory then they can be dismissed as too "complex" or "unique". Facts,

1339

however, should inform theory and any theory's methodology should take

1340

this into account. To dismiss facts out of hand is to promote dogma.

1341

This is not to suggest that a theory should be modified very time new

1342

data comes along -- that would be crazy as unique situations *do* exist,

1343

data can be wrong and so forth -- but it does suggest that if your theory

1344

*continually* comes into conflict with reality, it is time to rethink the

1345

theory and not assume that facts cannot invalidate it. A true libertarian

1346

would approach a contradiction between reality and theory by evaluating

1347

the facts available and changing the theory is this is required, not by

1348

ignoring reality or dismissing it as "complex".

1349

1350

Thus, much of right-Libertarian theory is neither libertarian nor scientific.

1351

Much of right-libertarian thought is highly axiomatic, being logically

1352

deduced from such starting axioms as "self-ownership" or "no one should

1353

initiate force against another". Hence the importance of our discussion

1354

of von Mises as this indicates the dangers of this approach, namely the

1355

tendency to ignore/dismiss the consequences of these logical chains and,

1356

indeed, to justify them in terms of these axioms rather than from the

1357

facts. In addition, the methodology used is such as that it would be

1358

fair to argue that right-libertarians get to critique reality but reality

1359

can never be used to critique right-libertarianism -- for any empirical

1360

data presented as evidence as be dismissed as "too complex" or "unique"

1361

and so irrelevant (unless it can be used to support their claims, of

1362

course).

1363

1364

Hence W. Duncan Reekie's argument (quoting leading Austrian economist

1365

Israel Kirzner) that "empirical work 'has the function of establishing

1366

the *applicability* of particular theorems, and thus *illustrating* their

1367

operation' . . . Confirmation of theory is not possible because there is no

1368

constants in human action, nor is it necessary because theorems themselves

1369

describe relationships logically developed from hypothesised conditions.

1370

Failure of a logically derived axiom to fit the facts does not render

1371

it invalid, rather it 'might merely indicate inapplicability' to the

1372

circumstances of the case.'" [_Markets, Entrepreneurs and Liberty_, p. 31]

1373

1374

So, if facts confirm your theory, your theory is right. If facts do not

1375

confirm your theory, it is still right but just not applicable in this case!

1376

Which has the handy side effect of ensuring that facts can *only* be used

1377

to support the ideology, *never* to refute it (which is, according to this

1378

perspective, impossible anyway). As Karl Popper argued, a "theory

1379

which is not refutable by any conceivable event is non-scientific."

1380

[_Conjectures and Refutations_, p. 36] In other words (as we noted

1381

above), if reality contradicts your theory, ignore reality!

1382

1383

Kropotkin hoped "that those who believe in [current economic doctrines]

1384

will themselves become convinced of their error as soon as they come

1385

to see the necessity of verifying their quantitative deductions by

1386

quantitative investigation." [Op. Cit., p. 178] However, the Austrian

1387

approach builds so many barriers to this that it is doubtful that

1388

this will occur. Indeed, right-libertarianism, with its focus on exchange

1389

rather than its consequences, seems to be based upon justifying domination

1390

in terms of their deductions than analysing what freedom actually means

1391

in terms of human existence (see section 2 for a fuller discussion).

1392

1393

The real question is why are such theories taken seriously and arouse

1394

such interest. Why are they not simply dismissed out of hand, given their

1395

methodology and the authoritarian conclusions they produce? The answer is,

1396

in part, that feeble arguments can easily pass for convincing when they

1397

are on the same side as the prevailing sentiment and social system. And, of

1398

course, there is the utility of such theories for ruling elites - "[a]n

1399

ideological defence of privileges, exploitation, and private power will be

1400

welcomed, regardless of its merits." [Noam Chomsky, _The Chomsky Reader_,

1401

p. 188]

1402

1403

1.4 Is "anarcho"-capitalism a new form of individualist anarchism?

1404

1405

Some "anarcho"-capitalists shy away from the term, preferring such

1406

expressions as "market anarchist" or "individualist anarchist." This

1407

suggests that there is some link between their ideology and that of

1408

Tucker. However, the founder of "anarcho"-capitalism, Murray Rothbard,

1409

refused that label for, while "strongly tempted," he could not do so

1410

because "Spooner and Tucker have in a sense pre-empted that name for

1411

their doctrine and that from that doctrine I have certain differences."

1412

Somewhat incredibly Rothbard argued that on the whole politically

1413

"these differences are minor," economically "the differences are

1414

substantial, and this means that my view of the consequences of

1415

putting our more of less common system into practice is very far from

1416

theirs." ["The Spooner-Tucker Doctrine: An Economist's View", _Journal

1417

of Libertarian Studies_, vol. 20, no. 1, p. 7]

1418

1419

What an understatement! Individualist anarchists advocated an economic

1420

system in which there would have been very little inequality of wealth

1421

and so of power (and the accumulation of capital would have been minimal

1422

without profit, interest and rent). Removing this social and economic

1423

basis would result in *substantially* different political regimes. This

1424

can be seen from the fate of Viking Iceland, where a substantially

1425

communal and anarchistic system was destroyed from within by increasing

1426

inequality and the rise of tenant farming (see section 9 for details).

1427

In other words, politics is not isolated from economics. As David

1428

Wieck put it, Rothbard "writes of society as though some part of it

1429

(government) can be extracted and replaced by another arrangement while

1430

other things go on before, and he constructs a system of police and

1431

judicial power without any consideration of the influence of historical

1432

and economic context." ["Anarchist Justice," in _Nomos XIX_, Pennock

1433

and Chapman, eds., p. 227]

1434

1435

Unsurprisingly, the political differences he highlights *are* significant,

1436

namely "the role of law and the jury system" and "the land question."

1437

The former difference relates to the fact that the individualist anarchists

1438

"allow[ed] each individual free-market court, and more specifically, each

1439

free-market jury, totally free rein over judicial decision." This horrified

1440

Rothbard. The reason is obvious, as it allows real people to judge the law

1441

as well as the facts, modifying the former as society changes and evolves.

1442

For Rothbard, the idea that ordinary people should have a say in the law is

1443

dismissed. Rather, "it would not be a very difficult task for Libertarian

1444

lawyers and jurists to arrive at a rational and objective code of libertarian

1445

legal principles and procedures." [Op. Cit., p. 7-8] Of course, the fact that

1446

"lawyers" and "jurists" may have a radically different idea of what is just

1447

than those subject to their laws is not raised by Rothbard, never mind

1448

answered. While Rothbard notes that juries may defend the people against

1449

the state, the notion that they may defend the people against the authority

1450

and power of the rich is not even raised. That is why the rich have tended to

1451

oppose juries as well as popular assemblies.

1452

1453

Unsurprisingly, the few individualist anarchists that remained pointed this

1454

out. Laurance Labadie, the son of Tucker associate Joseph Labadie, argued

1455

in response to Rothbard as follows:

1456

1457

"Mere common sense would suggest that any court would be influenced

1458

by experience; and any free-market court or judge would in the very

1459

nature of things have some precedents guiding them in their instructions

1460

to a jury. But since no case is exactly the same, a jury would have

1461

considerable say about the heinousness of the offence in each case,

1462

realising that circumstances alter cases, and prescribing penalty

1463

accordingly. This appeared to Spooner and Tucker to be a more flexible

1464

and equitable administration of justice possible or feasible, human

1465

beings being what they are.. . .

1466

1467

"But when Mr. Rothbard quibbles about the jurisprudential ideas of

1468

Spooner and Tucker, and at the same time upholds *presumably in his

1469

courts* the very economic evils which are at bottom the very reason

1470

for human contention and conflict, he would seem to be a man who

1471

chokes at a gnat while swallowing a camel." [quoted by Mildred J.

1472

Loomis and Mark A. Sullivan, "Laurance Labadie: Keeper Of The Flame",

1473

pp. 116-30, _Benjamin R. Tucker and the Champions of Liberty_,

1474

Coughlin, Hamilton and Sullivan (eds.), p. 124]

1475

1476

In other words, to exclude the general population from any say in the

1477

law and how it changes is hardly a "minor" difference! Particularly

1478

if you are proposing an economic system which is based on inequalities

1479

of wealth, power and influence and the means of accumulating more.

1480

It is like a supporter of the state saying that it is a "minor"

1481

difference if you favour a dictatorship rather than a democratically

1482

elected government. As Tucker argued, "it is precisely in the

1483

tempering of the rigidity of enforcement that one of the chief

1484

excellences of Anarchism consists . . . under Anarchism all rules

1485

and laws will be little more than suggestions for the guidance of

1486

juries, and that all disputes . . . will be submitted to juries

1487

which will judge not only the facts but the law, the justice of

1488

the law, its applicability to the given circumstances, and the

1489

penalty or damage to be inflicted because of its infraction . . .

1490

under Anarchism the law . . . will be regarded as *just* in

1491

proportion to its flexibility, instead of now in proportion to

1492

its rigidity." [_The Individualist Anarchists_, pp. 160-1] In

1493

others, the law will evolve to take into account changing social

1494

circumstances and, as a consequence, public opinion on specific

1495

events and rights. Tucker's position is fundamentally *democratic*

1496

and evolutionary while Rothbard's is autocratic and fossilised.

1497

1498

On the land question, Rothbard opposed the individualist position of

1499

"occupancy and use" as it "would automatically abolish all rent

1500

payments for land." Which was *precisely* why the individualist

1501

anarchists advocated it! In a predominantly rural economy, this

1502

would result in a significant levelling of income and social

1503

power as well as bolstering the bargaining position of non-land

1504

workers by reducing unemployment. He bemoans that landlords

1505

cannot charge rent on their "justly-acquired private property"

1506

without noticing that is begging the question as anarchists deny

1507

that this is "justly-acquired" land. Unsurprising, Rothbard

1508

considers "the property theory" of land ownership as John Locke's,

1509

ignoring the fact that the first self-proclaimed anarchist book

1510

was written to refute that kind of theory. His argument simply shows

1511

how far from anarchism his ideology is. For Rothbard, it goes

1512

without saying that the landlord's "freedom of contract" tops the

1513

worker's freedom to control their own work and live and, of course,

1514

their right to life. [Op. Cit., p. 8 and p. 9] However, for

1515

anarchists, "the land is indispensable to our existence,

1516

consequently a common thing, consequently insusceptible of

1517

appropriation." [Proudhon, _What is Property?_, p. 107]

1518

1519

The reason question is why Rothbard considers this a *political*

1520

difference rather than an economic one. Unfortunately, he does not

1521

explain. Perhaps because of the underlying *socialist* perspective

1522

behind the anarchist position? Or perhaps the fact that feudalism

1523

and monarchism was based on the owner of the land being its ruler

1524

suggests a political aspect to the ideology best left unexplored?

1525

Given that the idea of grounding rulership on land ownership receded

1526

during the Middle Ages, it may be unwise to note that under

1527

"anarcho"-capitalism the landlord and capitalist would, likewise,

1528

be sovereign over the land *and* those who used it? As we noted

1529

in section 1, this is the conclusion that Rothbard does draw.

1530

As such, there *is* a political aspect to this difference.

1531

1532

Moreover. "the expropriation of the mass of the people from the

1533

soil forms the basis of the capitalist mode of production." [Marx,

1534

_Capital_, vol. 1, p. 934] For there are "two ways of oppressing

1535

men: either directly by brute force, by physical violence; or

1536

indirectly by denying them the means of life and this reducing them

1537

to a state of surrender." In the second case, government is "an

1538

organised instrument to ensure that dominion and privilege will be

1539

in the hands of those who . . . have cornered all the means of life,

1540

first and foremost the land, which they make use of to keep the

1541

people in bondage and to make them work for their benefit."

1542

[Malatesta, _Anarchy_, p. 21] Privatising the coercive functions

1543

of said government hardly makes much difference.

1544

1545

Of course, Rothbard is simply skimming the surface. There are two

1546

main ways "anarcho"-capitalists differ from individualist anarchists.

1547

The first one is the fact that the individualist anarchists are

1548

socialists. The second is on whether equality is essential or not

1549

to anarchism. Each will be discussed in turn.

1550

1551

Unlike both Individualist (and social) anarchists, "anarcho"-capitalists

1552

support capitalism (a "pure" free market type, which has never existed

1553

although it has been approximated occasionally). This means that they

1554

reject totally the ideas of anarchists with regards to property and

1555

economic analysis. For example, like all supporters of capitalists

1556

they consider rent, profit and interest as valid incomes. In contrast,

1557

all Anarchists consider these as exploitation and agree with the

1558

Individualist Anarchist Benjamin Tucker when he argued that

1559

"*[w]hoever* contributes to production is alone entitled. *What*

1560

has no rights that *who* is bound to respect. *What* is a thing. *Who*

1561

is a person. Things have no claims; they exist only to be claimed. The

1562

possession of a right cannot be predicted of dead material, but only a

1563

living person."[quoted by Wm. Gary Kline, _The Individualist Anarchists_,

1564

p. 73]

1565

1566

This, we must note, is the fundamental critique of the capitalist theory

1567

that capital is productive. In and of themselves, fixed costs do not

1568

create value. Rather value is creation depends on how investments are

1569

developed and used once in place. Because of this the Individualist

1570

Anarchists, like other anarchists, considered non-labour derived income

1571

as usury, unlike "anarcho"-capitalists. Similarly, anarchists reject

1572

the notion of capitalist property rights in favour of possession

1573

(including the full fruits of one's labour). For example, anarchists

1574

reject private ownership of land in favour of a "occupancy and use"

1575

regime. In this we follow Proudhon's _What is Property?_ and argue that

1576

"property is theft". Rothbard, as noted, rejected this perspective.

1577

1578

As these ideas are an *essential* part of anarchist politics, they cannot

1579

be removed without seriously damaging the rest of the theory. This can

1580

be seen from Tucker's comments that "*Liberty* insists. . . [on] the abolition

1581

of the State and the abolition of usury; on no more government of man by

1582

man, and no more exploitation of man by man." [cited by Eunice Schuster in

1583

_Native American Anarchism_, p. 140]. He indicates that anarchism has

1584

specific economic *and* political ideas, that it opposes capitalism along

1585

with the state. Therefore anarchism was never purely a "political" concept,

1586

but always combined an opposition to oppression with an opposition to

1587

exploitation. The social anarchists made exactly the same point. Which

1588

means that when Tucker argued that "*Liberty* insists on Socialism. . . -

1589

true Socialism, Anarchistic Socialism: the prevalence on earth of Liberty,

1590

Equality, and Solidarity" he knew exactly what he was saying and meant it

1591

wholeheartedly. [_Instead of a Book_, p. 363]

1592

1593

So because "anarcho"-capitalists embrace capitalism and reject socialism,

1594

they cannot be considered anarchists or part of the anarchist tradition.

1595

1596

Which brings us nicely to the second point, namely a lack of concern for

1597

equality. In stark contrast to anarchists of all schools, inequality

1598

is not seen to be a problem with "anarcho"-capitalists (see section 3).

1599

However, it is a truism that not all "traders" are equally subject to the

1600

market (i.e. have the same market power). In many cases, a few have

1601

sufficient control of resources to influence or determine price and in

1602

such cases, all others must submit to those terms or not buy the commodity.

1603

When the commodity is labour power, even this option is lacking -- workers

1604

have to accept a job in order to live. As we argue in section 10.2,

1605

workers are usually at a disadvantage on the labour market when compared

1606

to capitalists, and this forces them to sell their liberty in return for

1607

making profits for others. These profits increase inequality in society

1608

as the property owners receive the surplus value their workers produce.

1609

This increases inequality further, consolidating market power and so weakens

1610

the bargaining position of workers further, ensuring that even the freest

1611

competition possible could not eliminate class power and society (something

1612

B. Tucker recognised as occurring with the development of trusts within

1613

capitalism -- see section G.4).

1614

1615

By removing the underlying commitment to abolish non-labour income, any

1616

"anarchist" capitalist society would have vast differences in wealth

1617

and so power. Instead of a government imposed monopolies in land, money

1618

and so on, the economic power flowing from private property and capital

1619

would ensure that the majority remained in (to use Spooner's words) "the

1620

condition of servants" (see sections 2 and 3.1 for more on this).

1621

The Individualist Anarchists were aware of this danger and so supported

1622

economic ideas that opposed usury (i.e. rent, profit and interest) and

1623

ensured the worker the full value of her labour. While not all of them

1624

called these ideas "socialist" it is clear that these ideas *are* socialist

1625

in nature and in aim (similarly, not all the Individualist Anarchists

1626

called themselves anarchists but their ideas are clearly anarchist in

1627

nature and in aim).

1628

1629

This combination of the political and economic is essential as they mutually

1630

reinforce each other. Without the economic ideas, the political ideas

1631

would be meaningless as inequality would make a mockery of them. As Kline

1632

notes, the Individualist Anarchists' "proposals were designed to establish

1633

true equality of opportunity . . . and they expected this would result in

1634

a society without great wealth or poverty. In the absence of monopolistic

1635

factors which would distort competition, they expected a society largely

1636

of self-employed workmen with no significant disparity of wealth between

1637

any of them since all would be required to live at their own expense and

1638

not at the expense of exploited fellow human beings." [Op. Cit., pp. 103-4]

1639

1640

Because of the evil effects of inequality on freedom, both social

1641

and individualist anarchists desired to create an environment in which

1642

circumstances would not drive people to sell their liberty to others

1643

at a disadvantage. In other words, they desired an equalisation of

1644

market power by opposing interest, rent and profit and capitalist

1645

definitions of private property. Kline summarises this by saying "the

1646

American [individualist] anarchists exposed the tension existing in

1647

liberal thought between private property and the ideal of equal access.

1648

The Individual Anarchists were, at least, aware that existing conditions

1649

were far from ideal, that the system itself working against the majority

1650

of individuals in their efforts to attain its promises. Lack of capital,

1651

the means to creation and accumulation of wealth, usually doomed a

1652

labourer to a life of exploitation. This the anarchists knew and they

1653

abhorred such a system." [Op. Cit., p. 102]

1654

1655

And this desire for bargaining equality is reflected in their economic

1656

ideas and by removing these underlying economic ideas of the individualist

1657

anarchists, "anarcho"-capitalism makes a mockery of any ideas they

1658

do appropriate. Essentially, the Individualist Anarchists agreed with

1659

Rousseau that in order to prevent extreme inequality of fortunes you

1660

deprive people of the means to accumulate in the first place and

1661

*not* take away wealth from the rich. An important point which

1662

"anarcho"-capitalism fails to understand or appreciate.

1663

1664

There are, of course, overlaps between individualist anarchism and

1665

"anarcho"-capitalism, just as there are overlaps between it and Marxism

1666

(and social anarchism, of course). However, just as a similar analysis

1667

of capitalism does not make individualist anarchists Marxists, so

1668

apparent similarities between individualist anarchism does not make

1669

it a forerunner of "anarcho"-capitalism. For example, both schools

1670

support the idea of "free markets." Yet the question of markets is

1671

fundamentally second to the issue of property rights for what is

1672

exchanged on the market is dependent on what is considered legitimate

1673

property. In this, as Rothbard notes, individualist anarchists and

1674

"anarcho"-capitalists differ and different property rights produce

1675

different market structures and dynamics. This means that capitalism

1676

is not the only economy with markets and so support for markets cannot

1677

be equated with support for capitalism. Equally, opposition to markets

1678

is *not* the defining characteristic of socialism (as we note in

1679

section G.2.1). As such, it *is* possible to be a market socialist

1680

(and many socialist are). This is because "markets" and "property" do

1681

not equate to capitalism:

1682

1683

"Political economy confuses, on principle, two very different kinds of

1684

private property, one of which rests on the labour of the producers

1685

himself, and the other on the exploitation of the labour of others. It

1686

forgets that the latter is not only the direct antithesis of the former,

1687

but grows on the former's tomb and nowhere else.

1688

1689

"In Western Europe, the homeland of political economy, the process of

1690

primitive accumulation is more of less accomplished. . . .

1691

1692

"It is otherwise in the colonies. There the capitalist regime constantly

1693

comes up against the obstacle presented by the producer, who, as owner

1694

of his own conditions of labour, employs that labour to enrich himself

1695

instead of the capitalist. The contradiction of these two diametrically

1696

opposed economic systems has its practical manifestation here in the

1697

struggle between them." [Karl Marx, _Capital_, vol. 1, p. 931]

1698

1699

Individualist anarchism is obviously an aspect of this struggle

1700

between the system of peasant and artisan production of early America

1701

and the state encouraged system of private property and wage labour.

1702

"Anarcho"-capitalists, in contrast, assume that generalised wage labour

1703

would remain under their system (while paying lip-service to the possibilities

1704

of co-operatives -- and if an "anarcho"-capitalist thinks that co-operative

1705

will become the dominant form of workplace organisation, then they are

1706

some kind of market socialist, *not* a capitalist). It is clear that their

1707

end point (a pure capitalism, i.e. generalised wage labour) is directly

1708

the opposite of that desired by anarchists. This was the case of the

1709

Individualist Anarchists who embraced the ideal of (non-capitalist)

1710

laissez faire competition -- they did so, as noted, to *end* exploitation,

1711

*not* to maintain it. Indeed, their analysis of the change in American

1712

society from one of mainly independent producers into one based mainly

1713

upon wage labour has many parallels with, of all people, Karl Marx's

1714

presented in chapter 33 of _Capital_. Marx, correctly, argues that "the

1715

capitalist mode of production and accumulation, and therefore capitalist

1716

private property, have for their fundamental condition the annihilation

1717

of that private property which rests on the labour of the individual

1718

himself; in other words, the expropriation of the worker." [Op. Cit.,

1719

p. 940] He notes that to achieve this, the state is used:

1720

1721

"How then can the anti-capitalistic cancer of the colonies be healed?

1722

. . . Let the Government set an artificial price on the virgin soil,

1723

a price independent of the law of supply and demand, a price that compels

1724

the immigrant to work a long time for wages before he can earn enough

1725

money to buy land, and turn himself into an independent farmer."

1726

[Op. Cit., p. 938]

1727

1728

Moreover, tariffs are introduced with "the objective of manufacturing

1729

capitalists artificially" for the "system of protection was an artificial

1730

means of manufacturing manufacturers, or expropriating independent

1731

workers, of capitalising the national means of production and

1732

subsistence, and of forcibly cutting short the transition . . . to

1733

the modern mode of production," to capitalism [Op. Cit., p. 932 and

1734

pp. 921-2]

1735

1736

It is this process which Individualist Anarchism protested against, the use

1737

of the state to favour the rising capitalist class. However, unlike social

1738

anarchists, many individualist anarchists were not consistently against

1739

wage labour. This is the other significant overlap between "anarcho"-capitalism

1740

and individualist anarchism. However, they were opposed to exploitation and

1741

argued (unlike "anarcho"-capitalism) that in their system workers bargaining

1742

powers would be raised to such a level that their wages would equal the full

1743

product of their labour. However, as we discuss in section G.1.1 the social

1744

context the individualist anarchists lived in must be remembered. America

1745

at the times was a predominantly rural society and industry was not as

1746

developed as it is now wage labour would have been minimised (Spooner,

1747

for example, explicitly envisioned a society made up mostly entirely of

1748

self-employed workers). As Kline argues:

1749

1750

"Committed as they were to equality in the pursuit of property, the

1751

objective for the anarchist became the construction of a society

1752

providing equal access to those things necessary for creating wealth.

1753

The goal of the anarchists who extolled mutualism and the abolition of

1754

all monopolies was, then, a society where everyone willing to work would

1755

have the tools and raw materials necessary for production in a

1756

non-exploitative system . . . the dominant vision of the future society

1757

. . . [was] underpinned by individual, self-employed workers." [Op. Cit.,

1758

p. 95]

1759

1760

As such, a limited amount of wage labour within a predominantly

1761

self-employed economy does not make a given society capitalist any

1762

more than a small amount of governmental communities within an

1763

predominantly anarchist world would make it statist. As Marx argued.

1764

when "the separation of the worker from the conditions of labour

1765

and from the soil . . . does not yet exist, or only sporadically,

1766

or on too limited a scale . . . Where, amongst such curious

1767

characters, is the 'field of abstinence' for the capitalists?

1768

. . . Today's wage-labourer is tomorrow's independent peasant

1769

or artisan, working for himself. He vanishes from the labour-market

1770

of wage-labourers into independent producers, who work for themselves

1771

instead of for capital" and so "the degree of exploitation of the

1772

wage-labourer remain[s] indecently low." In addition, the

1773

"wage-labourer also loses, along with the relation of dependence,

1774

the feeling of dependence on the abstemious capitalist." [Op. Cit.,

1775

pp. 935-6]

1776

1777

Saying that, as we discuss in section G.4, individualist anarchist support

1778

for wage labour is at odds with the ideas of Proudhon and, far more

1779

importantly, in contradiction to many of the stated principles of the

1780

individualist anarchists themselves. In particular, wage labour violates

1781

"occupancy and use" as well as having more than a passing similarity to

1782

the state. However, these problems can be solved by consistently applying

1783

the principles of individualist anarchism, unlike "anarcho"-capitalism,

1784

and that is why it is a real school of anarchism. In other words, a

1785

system of *generalised* wage labour would not be anarchist nor would

1786

it be non-exploitative. Moreover, the social context these ideas were

1787

developed in and would have been applied ensure that these contradictions

1788

would have been minimised. If they had been applied, a genuine anarchist

1789

society of self-employed workers would, in all likelihood, have been

1790

created (at least at first, whether the market would increase inequalities

1791

is a moot point -- see section G.4).

1792

1793

We must stress that the social situation is important as it shows how

1794

apparently superficially similar arguments can have radically different

1795

aims and results depending on who suggests them and in what circumstances.

1796

As noted, during the rise of capitalism the bourgeoisie were not shy in

1797

urging state intervention against the masses. Unsurprisingly, working class

1798

people generally took an anti-state position during this period. The

1799

individualist anarchists were part of that tradition, opposing what Marx

1800

termed "primitive accumulation" in favour of the pre-capitalist forms of

1801

property and society it was destroying.

1802

1803

However, when capitalism found its feet and could do without such obvious

1804

intervention, the possibility of an "anti-state" capitalism could arise.

1805

Such a possibility became a definite once the state started to intervene

1806

in ways which, while benefiting the system as a whole, came into conflict

1807

with the property and power of individual members of the capitalist and

1808

landlord class. Thus social legislation which attempted to restrict the

1809

negative effects of unbridled exploitation and oppression on workers and

1810

the environment were having on the economy were the source of much outrage

1811

in certain bourgeois circles:

1812

1813

"Quite independently of these tendencies [of individualist anarchism]

1814

. . . the anti-state bourgeoisie (which is also anti-statist, being

1815

hostile to any social intervention on the part of the State to protect

1816

the victims of exploitation -- in the matter of working hours, hygienic

1817

working conditions and so on), and the greed of unlimited exploitation,

1818

had stirred up in England a certain agitation in favour of

1819

pseudo-individualism, an unrestrained exploitation. To this end, they

1820

enlisted the services of a mercenary pseudo-literature . . . which

1821

played with doctrinaire and fanatical ideas in order to project a species

1822

of 'individualism' that was absolutely sterile, and a species of

1823

'non-interventionism' that would let a man die of hunger rather than

1824

offend his dignity." [Max Nettlau, _A Short History of Anarchism_, p. 39]

1825

1826

This perspective can be seen when Tucker denounced Herbert Spencer as

1827

a champion of the capitalistic class for his vocal attacks on social

1828

legislation which claimed to benefit working class people but stays

1829

strangely silent on the laws passed to benefit (usually indirectly)

1830

capital and the rich. "Anarcho"-capitalism is part of that tradition,

1831

the tradition associated with a capitalism which no longer needs obvious

1832

state intervention as enough wealth as been accumulated to keep workers

1833

under control by means of market power.

1834

1835

As with the original nineteenth century British "anti-state"

1836

capitalists like Spencer and Herbert, Rothbard "completely overlooks

1837

the role of the state in building and maintaining a capitalist economy

1838

in the West. Privileged to live in the twentieth century, long after

1839

the battles to establish capitalism have been fought and won, Rothbard

1840

sees the state solely as a burden on the market and a vehicle for

1841

imposing the still greater burden of socialism. He manifests a kind

1842

of historical nearsightedness that allows him to collapse many centuries

1843

of human experience into one long night of tyranny that ended only with

1844

the invention of the free market and its 'spontaneous' triumph over the

1845

past. It is pointless to argue, as Rothbard seems ready to do, that

1846

capitalism would have succeeded without the bourgeois state; the fact

1847

is that all capitalist nations have relied on the machinery of government

1848

to create and preserve the political and legal environments required

1849

by their economic system." That, of course, has not stopped him "critis[ing]

1850

others for being unhistorical." [Stephen L Newman, _Liberalism at Wit's

1851

End_, pp. 77-8 and p. 79]

1852

1853

In other words, there is substantial differences between the victims of a

1854

thief trying to stop being robbed and be left alone to enjoy their property

1855

and the successful thief doing the same! Individualist Anarchist's were

1856

aware of this. For example, Victor Yarros stressed this key difference

1857

between individualist anarchism and the proto-"libertarian" capitalists

1858

of "voluntaryism":

1859

1860

"[Auberon Herbert] believes in allowing people to retain all their

1861

possessions, no matter how unjustly and basely acquired, while getting

1862

them, so to speak, to swear off stealing and usurping and to promise to

1863

behave well in the future. We, on the other hand, while insisting on the

1864

principle of private property, in wealth honestly obtained under the reign

1865

of liberty, do not think it either unjust or unwise to dispossess the

1866

landlords who have monopolised natural wealth by force and fraud. We hold

1867

that the poor and disinherited toilers would be justified in expropriating,

1868

not alone the landlords, who notoriously have no equitable titles to their

1869

lands, but *all* the financial lords and rulers, all the millionaires and

1870

very wealthy individuals. . . . Almost all possessors of great wealth

1871

enjoy neither what they nor their ancestors rightfully acquired (and if

1872

Mr. Herbert wishes to challenge the correctness of this statement, we are

1873

ready to go with him into a full discussion of the subject). . . .

1874

1875

"If he holds that the landlords are justly entitled to their lands, let

1876

him make a defence of the landlords or an attack on our unjust proposal."

1877

[quoted by Carl Watner, "The English Individualists As They Appear In

1878

Liberty," pp. 191-211, _Benjamin R. Tucker and the Champions of Liberty_,

1879

Coughlin, Hamilton and Sullivan (eds.), pp. 199-200]

1880

1881

Significantly, Tucker and other individualist anarchists saw state intervention

1882

has a result of capital manipulating legislation to gain an advantage on the

1883

so-called free market which allowed them to exploit labour and, as such, it

1884

benefited the *whole* capitalist class. Rothbard, at best, acknowledges

1885

that *some* sections of big business benefit from the current system and so

1886

fails to have the comprehensive understanding of the dynamics of capitalism

1887

as a *system* (rather as an ideology). This lack of understanding of capitalism

1888

as a historic and dynamic system rooted in class rule and economic power is

1889

important in evaluating "anarcho"-capitalist claims to anarchism. Marxists

1890

are not considered anarchists as they support the state as a means of

1891

transition to an anarchist society. Much the same logic can be applied to

1892

right-wing libertarians (even if they do call themselves "anarcho"-capitalists).

1893

This is because they do not seek to correct the inequalities produced by

1894

previous state action before ending it nor do they seek to change the

1895

definitions of "private property" imposed by the state. In effect, they

1896

argue that the "dictatorship of the bourgeoisie" should "wither away" and

1897

be limited to defending the property accumulated in a few hands. Needless

1898

to say, starting from the current (coercively produced) distribution of

1899

property and then eliminating "force" simply means defending the power and

1900

privilege of ruling minorities:

1901

1902

"The modern Individualism initiated by Herbert Spencer is, like the critical

1903

theory of Proudhon, a powerful indictment against the dangers and wrongs of

1904

government, but its practical solution of the social problem is miserable --

1905

so miserable as to lead us to inquire if the talk of 'No force' be merely an

1906

excuse for supporting landlord and capitalist domination." [_Act For

1907

Yourselves_, p. 98]

1908

1909

2 What do "anarcho"-capitalists mean by "freedom"?

1910

1911

For "anarcho"-capitalists, the concept of freedom is limited to the idea

1912

of "freedom from." For them, freedom means simply freedom from the

1913

"initiation of force," or the "non-aggression against anyone's person and

1914

property." [Murray Rothbard, _For a New Liberty_, p. 23] The notion that

1915

real freedom must combine both freedom "to" *and* freedom "from" is

1916

missing in their ideology, as is the social context of the so-called

1917

freedom they defend.

1918

1919

Before starting, it is useful to quote Alan Haworth when he notes that

1920

"[i]n fact, it is surprising how *little* close attention the concept

1921

of freedom receives from libertarian writers. Once again _Anarchy,

1922

State, and Utopia_ is a case in point. The word 'freedom' doesn't

1923

even appear in the index. The word 'liberty' appears, but only to

1924

refer the reader to the 'Wilt Chamberlain' passage. In a supposedly

1925

'libertarian' work, this is more than surprising. It is truly

1926

remarkable." [_Anti-Libertarianism_, p. 95]

1927

1928

Why this is the case can be seen from how the "anarcho"-capitalist

1929

defines freedom.

1930

1931

In a right-libertarian or "anarcho"-capitalist society, freedom is

1932

considered to be a product of property. As Murray Rothbard puts it, "the

1933

libertarian defines the concept of 'freedom' or 'liberty'. . .[as a]

1934

condition in which a person's ownership rights in his body and his

1935

legitimate material property rights are not invaded, are not aggressed

1936

against. . . . Freedom and unrestricted property rights go hand in hand."

1937

[Op. Cit., p.41]

1938

1939

This definition has some problems, however. In such a society, one cannot

1940

(legitimately) do anything with or on another's property if the owner

1941

prohibits it. This means that an individual's only *guaranteed* freedom

1942

is determined by the amount of property that he or she owns. This has the

1943

consequence that someone with no property has no guaranteed freedom at

1944

all (beyond, of course, the freedom not to be murdered or otherwise

1945

harmed by the deliberate acts of others). In other words, a distribution

1946

of property is a distribution of freedom, as the right-libertarians

1947

themselves define it. It strikes anarchists as strange that an ideology

1948

that claims to be committed to promoting freedom entails the conclusion

1949

that some people should be more free than others. However, this is the

1950

logical implication of their view, which raises a serious doubt as to

1951

whether "anarcho"-capitalists are actually interested in freedom.

1952

1953

Looking at Rothbard's definition of "liberty" quoted above, we can

1954

see that freedom is actually no longer considered to be a fundamental,

1955

independent concept. Instead, freedom is a derivative of something

1956

more fundamental, namely the "legitimate rights" of an individual,

1957

which are identified as property rights. In other words, given that

1958

"anarcho"-capitalists and right libertarians in general consider the

1959

right to property as "absolute," it follows that freedom and property

1960

become one and the same. This suggests an alternative name for the right

1961

Libertarian, namely "Propertarian." And, needless to say, if we do not

1962

accept the right-libertarians' view of what constitutes "legitimate"

1963

"rights," then their claim to be defenders of liberty is weak.

1964

1965

Another important implication of this "liberty as property" concept is

1966

that it produces a strangely alienated concept of freedom. Liberty, as

1967

we noted, is no longer considered absolute, but a derivative of property

1968

and still be considered free by the ideology. This concept of liberty

1969

(namely "liberty as property") is usually termed "self-ownership." But,

1970

to state the obvious, I do not "own" myself, as if were an object somehow

1971

separable from my subjectivity -- I *am* myself. However, the concept of

1972

"self-ownership" is handy for justifying various forms of domination and

1973

oppression -- for by agreeing (usually under the force of circumstances,

1974

we must note) to certain contracts, an individual can "sell" (or rent out)

1975

themselves to others (for example, when workers sell their labour power to

1976

capitalists on the "free market"). In effect, "self-ownership" becomes the

1977

means of justifying treating people as objects -- ironically, the very thing

1978

the concept was created to stop! As L. Susan Brown notes, "[a]t the moment

1979

an individual 'sells' labour power to another, he/she loses self-determination

1980

and instead is treated as a subjectless instrument for the fulfilment of

1981

another's will." [_The Politics of Individualism_, p. 4]

1982

1983

Given that workers are paid to obey, you really have to wonder which planet

1984

Murray Rothbard is on when he argues that a person's "labour service is

1985

alienable, but his *will* is not" and that he [sic!] "cannot alienate his

1986

*will*, more particularly his control over his own mind and body." [_The

1987

Ethics of Liberty_, p. 40, p. 135] He contrasts private property and

1988

self-ownership by arguing that "[a]ll physical property owned by a person

1989

is alienable . . . I can give away or sell to another person my shoes, my

1990

house, my car, my money, etc. But there are certain vital things which, in

1991

natural fact and in the nature of man, are *in*alienable . . . [his] will

1992

and control over his own person are inalienable." [Op. Cit., pp. 134-5]

1993

1994

But "labour services" are unlike the private possessions Rothbard lists

1995

as being alienable. As we argued in section B.1 ("Why do anarchists oppose

1996

hierarchy") a person's "labour services" and "will" cannot be divided -- if

1997

you sell your labour services, you also have to give control of your body

1998

and mind to another person! If a worker does not obey the commands of her

1999

employer, she is fired. That Rothbard denies this indicates a total lack

2000

of common-sense. Perhaps Rothbard will argue that as the worker can quit at

2001

any time she does not alienate their will (this seems to be his case against

2002

slave contracts -- see section 2.6). But this ignores the fact that between

2003

the signing and breaking of the contract and during work hours (and perhaps

2004

outside work hours, if the boss has mandatory drug testing or will fire

2005

workers who attend union or anarchist meetings or those who have an

2006

"unnatural" sexuality and so on) the worker *does* alienate his will

2007

and body. In the words of Rudolf Rocker, "under the realities of the

2008

capitalist economic form . . . there can be no talk of a 'right over one's

2009

own person,' for that ends when one is compelled to submit to the economic

2010

dictation of another if he does not want to starve." [_Anarcho-Syndicalism_,

2011

p. 17]

2012

2013

Ironically, the rights of property (which are said to flow from an

2014

individual's self-ownership of themselves) becomes the means, under

2015

capitalism, by which self-ownership of non-property owners is denied. The

2016

foundational right (self-ownership) becomes denied by the derivative right

2017

(ownership of things). Under capitalism, a lack of property can be just

2018

as oppressive as a lack of legal rights because of the relationships of

2019

domination and subjection this situation creates.

2020

2021

So Rothbard's argument (as well as being contradictory) misses the point

2022

(and the reality of capitalism). Yes, *if* we define freedom as "the absence

2023

of coercion" then the idea that wage labour does not restrict liberty is

2024

unavoidable, but such a definition is useless. This is because it hides

2025

structures of power and relations of domination and subordination. As Carole

2026

Pateman argues, "the contract in which the worker allegedly sells his labour

2027

power is a contract in which, since he cannot be separated from his

2028

capacities, he sells command over the use of his body and himself. . .

2029

To sell command over the use of oneself for a specified period . . .

2030

is to be an unfree labourer." [_The Sexual Contract_, p. 151]

2031

2032

In other words, contracts about property in the person inevitably create

2033

subordination. "Anarcho"-capitalism defines this source of unfreedom away,

2034

but it still exists and has a major impact on people's liberty. Therefore

2035

freedom is better described as "self-government" or "self-management" --

2036

to be able to govern ones own actions (if alone) or to participate in the

2037

determination of join activity (if part of a group). Freedom, to put it

2038

another way, is not an abstract legal concept, but the vital concrete

2039

possibility for every human being to bring to full development all their

2040

powers, capacities, and talents which nature has endowed them. A key

2041

aspect of this is to govern one own actions when within associations

2042

(self-management). If we look at freedom this way, we see that coercion

2043

is condemned but so is hierarchy (and so is capitalism for during working

2044

hours, people are not free to make their own plans and have a say in what

2045

affects them. They are order takers, *not* free individuals).

2046

2047

It is because anarchists have recognised the authoritarian nature of

2048

capitalist firms that they have opposed wage labour and capitalist

2049

property rights along with the state. They have desired to replace

2050

institutions structured by subordination with institutions constituted

2051

by free relationships (based, in other words, on self-management) in

2052

*all* areas of life, including economic organisations. Hence Proudhon's

2053

argument that the "workmen's associations . . . are full of hope both as a

2054

protest against the wage system, and as an affirmation of *reciprocity*"

2055

and that their importance lies "in their denial of the rule of capitalists,

2056

money lenders and governments." [_The General Idea of the Revolution_,

2057

pp. 98-99]

2058

2059

Unlike anarchists, the "anarcho"-capitalist account of freedom allows an

2060

individual's freedom to be rented out to another while maintaining that the

2061

person is still free. It may seem strange that an ideology proclaiming its

2062

support for liberty sees nothing wrong with the alienation and denial of

2063

liberty but, in actual fact, it is unsurprising. After all, contract theory

2064

is a "theoretical strategy that justifies subjection by presenting it as

2065

freedom" and nothing more. Little wonder, then, that contract "creates

2066

a relation of subordination" and not of freedom [Carole Pateman, Op. Cit.,

2067

p. 39, p. 59]

2068

2069

Any attempt to build an ethical framework starting from the abstract

2070

individual (as Rothbard does with his "legitimate rights" method) will

2071

result in domination and oppression between people, *not* freedom.

2072

Indeed, Rothbard provides an example of the dangers of idealist

2073

philosophy that Bakunin warned about when he argued that while

2074

"[m]aterialism denies free will and ends in the establishment of

2075

liberty; idealism, in the name of human dignity, proclaims free

2076

will, and on the ruins of every liberty founds authority." [_God

2077

and the State_, p. 48] This is the case with "anarcho"-capitalism

2078

can be seen from Rothbard's wholehearted support for wage labour

2079

and the rules imposed by property owners on those who use, but do

2080

not own, their property. Rothbard, basing himself on abstract

2081

individualism, cannot help but justify authority over liberty.

2082

2083

Overall, we can see that the logic of the right-libertarian definition of

2084

"freedom" ends up negating itself, because it results in the creation

2085

and encouragement of *authority,* which is an *opposite* of freedom. For

2086

example, as Ayn Rand points out, "man has to sustain his life by his own

2087

effort, the man who has no right to the product of his effort has no means

2088

to sustain his life. The man who produces while others dispose of his

2089

product, is a slave." [_The Ayn Rand Lexicon: Objectivism from A to Z_,

2090

pp. 388-9] But, as was shown in section C, capitalism is based on, as

2091

Proudhon put it, workers working "for an entrepreneur who pays them and

2092

keeps their products," and so is a form of *theft.* Thus, by "libertarian"

2093

capitalism's *own* logic, capitalism is based not on freedom, but on

2094

(wage) slavery; for interest, profit and rent are derived from a worker's

2095

*unpaid* labour, i.e. "others dispose of his [sic] product."

2096

2097

And if a society *is* run on the wage- and profit-based system suggested

2098

by the "anarcho" and "libertarian" capitalists, freedom becomes a

2099

commodity. The more money you have, the more freedom you get. Then, since

2100

money is only available to those who earn it, Libertarianism is based on

2101

that classic saying "work makes one free!" (_Arbeit macht frei!_), which

2102

the Nazis placed on the gates of their concentration camps. Of course,

2103

since it is capitalism, this motto is somewhat different for those at the

2104

top. In this case it is "other people's work makes one free!" -- a truism

2105

in any society based on private property and the authority that stems from

2106

it.

2107

2108

Thus it is debatable that a libertarian or "anarcho" capitalist society

2109

would have less unfreedom or coercion in it than "actually existing

2110

capitalism." In contrast to anarchism, "anarcho"-capitalism, with its

2111

narrow definitions, restricts freedom to only a few aspects of social life

2112

and ignores domination and authority beyond those aspects. As Peter Marshall

2113

points out, the right-libertarian's "definition of freedom is entirely

2114

negative. It calls for the absence of coercion but cannot guarantee the

2115

positive freedom of individual autonomy and independence." [_Demanding

2116

the Impossible_, p. 564] By confining freedom to such a narrow range of

2117

human action, "anarcho"-capitalism is clearly *not* a form of anarchism.

2118

Real anarchists support freedom in every aspect of an individual's life.

2119

2120

2.1 What are the implications of defining liberty in terms of (property)

2121

rights?

2122

2123

The change from defending liberty to defending (property) rights has

2124

important implications. For one thing, it allows right libertarians to

2125

imply that private property is similar to a "fact of nature," and so to

2126

conclude that the restrictions on freedom produced by it can be ignored.

2127

This can be seen in Robert Nozick's argument that decisions are voluntary

2128

if the limitations on one's actions are not caused by human action which

2129

infringe the rights of others. Thus, in a "pure" capitalist society the

2130

restrictions on freedom caused by wage slavery are not really restrictions

2131

because the worker voluntarily consents to the contract. The circumstances

2132

that drive a worker to make the contract are irrelevant because they are

2133

created by people exercising their rights and not violating other peoples'

2134

ones (see the section on "Voluntary Exchange" in _Anarchy, State, and

2135

Utopia_, pp. 262-265).

2136

2137

This means that within a society "[w]hether a person's actions are voluntary

2138

depends on what limits his alternatives. If facts of nature do so, the

2139

actions are voluntary. (I may voluntarily walk to someplace I would prefer

2140

to fly to unaided)." [_Anarchy, State, and Utopia_, p. 262] Similarly,

2141

the results of voluntary actions and the transference of property can

2142

be considered alongside the "facts of nature" (they are, after all, the

2143

resultants of "natural rights"). This means that the circumstances created

2144

by the existence and use of property can be considered, in essence, as

2145

a "natural" fact and so the actions we take in response to these circumstances

2146

are therefore "voluntary" and we are "free" (Nozick presents the example

2147

[p. 263] of someone who marries the only available person -- all the more

2148

attractive people having already chosen others -- as a case of an action

2149

that is voluntary despite removal of all but the least attractive alternative

2150

through the legitimate actions of others. Needless to say, the example can

2151

be -- and is -- extended to workers on the labour market -- although, of

2152

course, you do not starve to death if you decide not to marry).

2153

2154

However, such an argument fails to notice that property is different from

2155

gravity or biology. Of course not being able to fly does not restrict

2156

freedom. Neither does not being able to jump 10 feet into the air. But

2157

unlike gravity (for example), private property has to be protected by laws

2158

and the police. No one stops you from flying, but laws and police forces

2159

must exist to ensure that capitalist property (and the owners' authority

2160

over it) is respected. The claim, therefore, that private property in

2161

general, and capitalism in particular, can be considered as "facts of

2162

nature," like gravity, ignores an important fact: namely that the

2163

people involved in an economy must accept the rules of its operation --

2164

rules that, for example, allow contracts to be enforced; forbid using

2165

another's property without his or her consent ("theft," trespass, copyright

2166

infringement, etc.); prohibit "conspiracy," unlawful assembly, rioting,

2167

and so on; and create monopolies through regulation, licensing, charters,

2168

patents, etc. This means that capitalism has to include the mechanisms

2169

for deterring property crimes as well as mechanisms for compensation and

2170

punishment should such crimes be committed. In other words, capitalism

2171

is in fact far more than "voluntary bilateral exchange," because it *must*

2172

include the policing, arbitration, and legislating mechanisms required

2173

to ensure its operation. Hence, like the state, the capitalist market

2174

is a social institution, and the distributions of goods that result

2175

from its operation are therefore the distributions sanctioned by a

2176

capitalist society. As Benjamin Franklin pointed out, "Private property

2177

. . . is a Creature of Society, and is subject to the Calls of that

2178

Society."

2179

2180

Thus, to claim with Sir Isaiah Berlin (the main, modern, source of the

2181

concepts of "negative" and "positive" freedom -- although we must add that

2182

Berlin was not a right-Libertarian), that "[i]f my poverty were a kind of

2183

disease, which prevented me from buying bread . . . as lameness prevents

2184

me from running, this inability would not naturally be described as a

2185

lack of freedom" totally misses the point ["Two Concepts of Liberty",

2186

in _Four Essays on Liberty_, p. 123]. If you are lame, police officers

2187

do not come round to stop you running. They do not have to. However, they

2188

*are* required to protect property against the dispossessed and those who

2189

reject capitalist property rights.

2190

2191

This means that by using such concepts as "negative" liberty and ignoring

2192

the social nature of private property, right-libertarians are trying to

2193

turn the discussion away from liberty toward "biology" and other facts

2194

of nature. And conveniently, by placing property rights alongside gravity

2195

and other natural laws, they also succeed in reducing debate even about

2196

rights.

2197

2198

Of course, coercion and restriction of liberty *can* be resisted, unlike

2199

"natural forces" like gravity. So if, as Berlin argues, "negative"

2200

freedom means that you "lack political freedom only if you are prevented

2201

from attaining a goal by human beings," then capitalism is indeed based on

2202

such a lack, since property rights need to be enforced by human beings ("I

2203

am prevented by others from doing what I could otherwise do"). After all,

2204

as Proudhon long ago noted, the market is manmade, hence any constraint

2205

it imposes is the coercion of man by man and so economic laws are not as

2206

inevitable as natural ones [see Alan Ritter's _The Political Thought of

2207

Pierre-Joseph Proudhon_, p. 122]. Or, to put it slightly differently,

2208

capitalism requires coercion in order to work, and hence, is *not*

2209

similar to a "fact of nature," regardless of Nozick's claims (i.e.

2210

property rights have to be defined and enforced by human beings, although

2211

the nature of the labour market resulting from capitalist property

2212

definitions is such that direct coercion is usually not needed). This

2213

implication is actually recognised by right-libertarians, because they

2214

argue that the rights-framework of society should be set up in one way

2215

rather than another. In other words, they recognise that society is not

2216

independent of human interaction, and so can be changed.

2217

2218

Perhaps, as seems the case, the "anarcho"-capitalist or right-Libertarian

2219

will claim that it is only *deliberate* acts which violate your (libertarian

2220

defined) rights by other humans beings that cause unfreedom ("we define

2221

freedom . . . as the *absence of invasion* by another man of an man's

2222

person or property" [Rothbard, _The Ethics of Liberty_, p. 41]) and so

2223

if no-one deliberately coerces you then you are free. In this way the

2224

workings of the capitalist market can be placed alongside the "facts of

2225

nature" and ignored as a source of unfreedom. However, a moments thought

2226

shows that this is not the case. Both deliberate and non-deliberate acts

2227

can leave individuals lacking freedom.

2228

2229

Let us assume (in an example paraphrased from Alan Haworth's excellent

2230

book _Anti-Libertarianism_, p. 49) that someone kidnaps you and places you

2231

down a deep (naturally formed) pit, miles from anyway, which is impossible

2232

to climb up. No one would deny that you are unfree. Let us further assume

2233

that another person walks by and accidentally falls into the pit with you.

2234

2235

According to right-libertarianism, while you are unfree (i.e. subject to

2236

deliberate coercion) your fellow pit-dweller is perfectly free for they

2237

have subject to the "facts of nature" and not human action (deliberate or

2238

otherwise). Or, perhaps, they "voluntarily choose" to stay in the pit,

2239

after all, it is "only" the "facts of nature" limiting their actions. But,

2240

obviously, both of you are in *exactly the same position,* have *exactly

2241

the same choices* and so are *equally* unfree! Thus a definition of

2242

"liberty" that maintains that only deliberate acts of others -- for

2243

example, coercion -- reduces freedom misses the point totally.

2244

2245

Why is this example important? Let us consider Murray Rothbard's analysis

2246

of the situation after the abolition of serfdom in Russia and slavery in

2247

America. He writes:

2248

2249

"The *bodies* of the oppressed were freed, but the property which they

2250

had worked and eminently deserved to own, remained in the hands of their

2251

former oppressors. With economic power thus remaining in their hands, the

2252

former lords soon found themselves virtual masters once more of what

2253

were now free tenants or farm labourers. The serfs and slaves had tasted

2254

freedom, but had been cruelly derived of its fruits." [_The Ethics of

2255

Liberty_, p. 74]

2256

2257

However, contrast this with Rothbard's claims that if market forces

2258

("voluntary exchanges") result in the creation of free tenants or labourers

2259

then these labourers and tenants are free (see, for example, _The Ethics of

2260

Liberty_, pp. 221-2 on why "economic power" within capitalism does not

2261

exist). But the labourers dispossessed by market forces are in *exactly*

2262

the same situation as the former serfs and slaves. Rothbard sees the

2263

obvious "economic power" in the later case, but denies it in the former.

2264

But the *conditions* of the people in question are identical and it

2265

is these conditions that horrify us. It is only his ideology that stops

2266

Rothbard drawing the obvious conclusion -- identical conditions produce

2267

identical social relationships and so if the formally "free" ex-serfs are

2268

subject to "economic power" and "masters" then so are the formally "free"

2269

labourers within capitalism! Both sets of workers may be formally free,

2270

but their circumstances are such that they are "free" to "consent" to

2271

sell their freedom to others (i.e. economic power produces relationships

2272

of domination and unfreedom between formally free individuals).

2273

2274

Thus Rothbard's definition of liberty in terms of rights fails to provide

2275

us with a realistic and viable understanding of freedom. Someone can be

2276

a virtual slave while still having her rights non-violated (conversely,

2277

someone can have their property rights violated and still be free; for

2278

example, the child who enters your backyard without your permission to

2279

get her ball hardly violates your liberty -- indeed, you would never know

2280

that she has entered your property unless you happened to see her do it).

2281

So the idea that freedom means non-aggression against person and their

2282

legitimate material property justifies extensive *non-freedom* for the

2283

working class. The non-violation of property rights does *not* imply freedom,

2284

as Rothbard's discussion of the former slaves shows. Anyone who, along with

2285

Rothbard, defines freedom "as the *absence of invasion* by another man of

2286

any man's person or property" in a deeply inequality society is supporting,

2287

and justifying, capitalist and landlord domination. As anarchists have

2288

long realised, in an unequal society, a contractarian starting point

2289

implies an absolutist conclusion.

2290

2291

Why is this? Simply because freedom is a result of *social* interaction,

2292

not the product of some isolated, abstract individual (Rothbard uses the

2293

model of Robinson Crusoe to construct his ideology). But as Bakunin

2294

argued, "the freedom of the individual is a function of men in society,

2295

a necessary consequence of the collective development of mankind." He

2296

goes on to argue that "man in isolation can have no awareness of his

2297

liberty . . . Liberty is therefore a feature not of isolation but of

2298

interaction, not of exclusion but rather of connection." [_Selected

2299

Writings_, p. 146, p. 147] Right Libertarians, by building their

2300

definition of freedom from the isolated person, end up by supporting

2301

restrictions of liberty due to a neglect of an adequate recognition

2302

of the actual interdependence of human beings, of the fact what each

2303

person does is effected by and affects others. People become aware of

2304

their humanity (liberty) in society, not outside it. It is the *social

2305

relationships* we take part in which determine how free we are and

2306

any definition of freedom which builds upon an individual without

2307

social ties is doomed to create relations of domination, not freedom,

2308

between individuals -- as Rothbard's theory does (to put it another

2309

way, voluntary association is a necessary, but not sufficient,

2310

condition for freedom. Which is why anarchists have always stressed

2311

the importance of equality -- see section 3 for details).

2312

2313

So while facts of nature can restrict your options and freedom, it is the

2314

circumstances within which they act and the options they limit that are

2315

important (a person trapped at the bottom of a pit is unfree as the options

2316

available are so few; the lame person is free because their available options

2317

are extensive). In the same manner, the facts of society can and do restrict

2318

your freedom because they are the products of human action and are defined

2319

and protected by human institutions, it is the circumstances within which

2320

individuals make their decisions and the social relationships these decisions

2321

produce that are important (the worker driven by poverty to accept a slave

2322

contract in a sweat shop is unfree because the circumstances he faces have

2323

limited his options and the relations he accepts are based upon hierarchy;

2324

the person who decides to join an anarchist commune is free because the

2325

commune is non-hierarchical and she has the option of joining another

2326

commune, working alone and so forth).

2327

2328

All in all, the right-Libertarian concept of freedom is lacking. For an

2329

ideology that takes the name "Libertarianism" it is seems happy to ignore

2330

actual liberty and instead concentrate on an abstract form of liberty which

2331

ignores so many sources of unfreedom as to narrow the concept until it

2332

becomes little more than a justification for authoritarianism. This can be

2333

seen from right-Libertarian attitudes about private property and its effects

2334

on liberty (as discussed in the next section).

2335

2336

2.2 How does private property affect freedom?

2337

2338

The right-libertarian does not address or even acknowledge that the

2339

(absolute) right of private property may lead to extensive control by

2340

property owners over those who use, but do not own, property (such as

2341

workers and tenants). Thus a free-market capitalist system leads to a

2342

very selective and class-based protection of "rights" and "freedoms."

2343

For example, under capitalism, the "freedom" of employers inevitably

2344

conflicts with the "freedom" of employees. When stockholders or their

2345

managers exercise their "freedom of enterprise" to decide how their

2346

company will operate, they violate their employee's right to decide

2347

how their labouring capacities will be utilised. In other words, under

2348

capitalism, the "property rights" of employers will conflict with and

2349

restrict the "human right" of employees to manage themselves. Capitalism

2350

allows the right of self-management only to the few, not to all. Or,

2351

alternatively, capitalism does not recognise certain human rights as

2352

*universal* which anarchism does.

2353

2354

This can be seen from Austrian Economist W. Duncan Reekie's defence of

2355

wage labour. While referring to "intra-firm labour markets" as "hierarchies",

2356

Reekie (in his best *ex cathedra* tone) states that "[t]here is nothing

2357

authoritarian, dictatorial or exploitative in the relationship. Employees

2358

order employers to pay them amounts specified in the hiring contract just

2359

as much as employers order employees to abide by the terms of the contract."

2360

[_Markets, Entrepreneurs and Liberty_, p. 136, p. 137] Given that "the

2361

terms of contract" involve the worker agreeing to obey the employers

2362

orders and that they will be fired if they do not, its pretty clear that the

2363

ordering that goes on in the "intra-firm labour market" is decidedly *one

2364

way*. Bosses have the power, workers are paid to obey. And this begs the

2365

question, *if* the employment contract creates a free worker, why must

2366

she abandon her liberty during work hours?

2367

2368

Reekie actually recognises this lack of freedom in a "round about" way

2369

when he notes that "employees in a firm at any level in the hierarchy can

2370

exercise an entrepreneurial role. The area within which that role can be

2371

carried out increases the more authority the employee has." [Op. Cit.,

2372

p. 142] Which means workers *are* subject to control from above which

2373

restricts the activities they are allowed to do and so they are *not*

2374

free to act, make decisions, participate in the plans of the organisation,

2375

to create the future and so forth within working hours. And it is strange

2376

that while recognising the firm as a hierarchy, Reekie tries to deny that

2377

it is authoritarian or dictatorial -- as if you could have a hierarchy

2378

without authoritarian structures or an unelected person in authority

2379

who is not a dictator. His confusion is shared by Austrian guru Ludwig

2380

von Mises, who asserts that the "entrepreneur and capitalist are not

2381

irresponsible autocrats" because they are "unconditionally subject to

2382

the sovereignty of the consumer" while, *on the next page*, admitting

2383

there is a "managerial hierarchy" which contains "the average subordinate

2384

employee." [_Human Action_, p. 809 and p. 810] It does not enter his

2385

mind that the capitalist may be subject to some consumer control while

2386

being an autocrat to their subordinated employees. Again, we find the

2387

right-"libertarian" acknowledging that the capitalist managerial

2388

structure is a hierarchy and workers are subordinated while denying

2389

it is autocratic to the workers! Thus we have "free" workers within

2390

a relationship distinctly *lacking* freedom (in the sense of

2391

self-government) -- a strange paradox. Indeed, if your personal

2392

life were as closely monitored and regulated as the work life of

2393

millions of people across the world, you would rightly consider it

2394

oppression.

2395

2396

Perhaps Reekie (like most right-libertarians) will maintain that workers

2397

voluntarily agree ("consent") to be subject to the bosses dictatorship

2398

(he writes that "each will only enter into the contractual agreement

2399

known as a firm if each believes he will be better off thereby. The

2400

firm is simply another example of mutually beneficial exchange"

2401

[Op. Cit., p. 137]). However, this does not stop the relationship

2402

being authoritarian or dictatorial (and so exploitative as it is

2403

*highly* unlikely that those at the top will not abuse their power).

2404

And as we argue further in the next section (and also see sections B.4,

2405

3.1 and 10.2), in a capitalist society workers have the option of

2406

finding a job or facing abject poverty and/or starvation.

2407

2408

Little wonder, then, that people "voluntarily" sell their labour and

2409

"consent" to authoritarian structures! They have little option to do

2410

otherwise. So, *within* the labour market, workers *can* and *do* seek

2411

out the best working conditions possible, but that does not mean that

2412

the final contract agreed is "freely" accepted and not due to the

2413

force of circumstances, that both parties have equal bargaining power

2414

when drawing up the contract or that the freedom of both parties is

2415

ensured. Which means to argue (as many right-libertarians do) that

2416

freedom cannot be restricted by wage labour because people enter

2417

into relationships they consider will lead to improvements over their

2418

initial situation totally misses the points. As the initial situation

2419

is not considered relevant, their argument fails. After all, agreeing

2420

to work in a sweatshop 14 hours a day *is* an improvement over starving

2421

to death -- but it does not mean that those who so agree are free

2422

when working there or actually *want* to be there. They are not and

2423

it is the circumstances, created and enforced by the law, that have

2424

ensured that they "consent" to such a regime (given the chance, they

2425

would desire to *change* that regime but cannot as this would violate

2426

their bosses property rights and they would be repressed for trying).

2427

2428

So the right-wing "libertarian" right is interested only in a narrow

2429

concept of freedom (rather than in "freedom" or "liberty" as such).

2430

This can be seen in the argument of Ayn Rand (a leading ideologue of

2431

"libertarian" capitalism) that "*Freedom*, in a political context, means

2432

freedom from government coercion. It does *not* mean freedom from the

2433

landlord, or freedom from the employer, or freedom from the laws of nature

2434

which do not provide men with automatic prosperity. It means freedom from

2435

the coercive power of the state -- and nothing else!" [_Capitalism: The

2436

Unknown Ideal_, p. 192] By arguing in this way, right libertarians ignore

2437

the vast number of authoritarian social relationships that exist in

2438

capitalist society and, as Rand does here, imply that these social

2439

relationships are like "the laws of nature." However, if one looks at the

2440

world without prejudice but with an eye to maximising freedom, the major

2441

coercive institution is seen to be not the state but capitalist social

2442

relationships (as indicated in section B.4).

2443

2444

The right "libertarian," then, far from being a defender of freedom, is

2445

in fact a keen defender of certain forms of authority and domination. As

2446

Peter Kropotkin noted, the "modern Individualism initiated by Herbert

2447

Spencer is, like the critical theory of Proudhon, a powerful indictment

2448

against the dangers and wrongs of government, but its practical solution

2449

of the social problem is miserable -- so miserable as to lead us to

2450

inquire if the talk of 'No force' be merely an excuse for supporting

2451

landlord and capitalist domination." [_Act For Yourselves_, p. 98]

2452

2453

To defend the "freedom" of property owners is to defend authority and

2454

privilege -- in other words, statism. So, in considering the concept of

2455

liberty as "freedom from," it is clear that by defending private property

2456

(as opposed to possession) the "anarcho"-capitalist is defending the power

2457

and authority of property owners to govern those who use "their" property.

2458

And also, we must note, defending all the petty tyrannies that make the

2459

work lives of so many people frustrating, stressful and unrewarding.

2460

2461

However, anarchism, by definition, is in favour of organisations and social

2462

relationships which are non-hierarchical and non-authoritarian. Otherwise,

2463

some people are more free than others. Failing to attack hierarchy leads

2464

to massive contradiction. For example, since the British Army is a

2465

volunteer one, it is an "anarchist" organisation! (see next section

2466

for a discussion on why the "anarcho"-capitalism concept of freedom

2467

also allows the state to appear "libertarian").

2468

2469

In other words, "full capitalist property rights" do not protect freedom,

2470

in fact they actively deny it. But this lack of freedom is only inevitable

2471

if we accept capitalist private property rights. If we reject them, we

2472

can try and create a world based on freedom in all aspects of life,

2473

rather than just in a few.

2474

2475

2.3 Can "anarcho"-capitalist theory justify the state?

2476

2477

Ironically enough, "anarcho"-capitalist ideology actually allows the state

2478

to be justified along with capitalist hierarchy. This is because the reason

2479

why capitalist authority is acceptable to the "anarcho"-capitalist is

2480

because it is "voluntary" -- no one forces the worker to join or remain

2481

within a specific company (force of circumstances are irrelevant in this

2482

viewpoint). Thus capitalist domination is not really domination at all. But

2483

the same can be said of all democratic states as well. Few such states bar

2484

exit for its citizens -- they are free to leave at any time and join any

2485

other state that will have them (exactly as employees can with companies).

2486

Of course there *are* differences between the two kinds of authority --

2487

anarchists do not deny that -- but the similarities are all too clear.

2488

2489

The "anarcho"-capitalist could argue that changing jobs is easier than

2490

changing states and, sometimes, this is correct -- but not always. Yes,

2491

changing states does require the moving of home and possessions over

2492

great distances but so can changing job (indeed, if a worker has

2493

to move half-way across a country or even the world to get a job

2494

"anarcho"-capitalists would celebrate this as an example of the

2495

benefits of a "flexible" labour market). Yes, states often conscript

2496

citizens and send them into dangerous situations but bosses often force

2497

their employees to accept dangerous working environments on pain of

2498

firing. Yes, many states do restrict freedom of association and speech,

2499

but so do bosses. Yes, states tax their citizens but landlords and

2500

companies only let others use their property if they get money in

2501

return (i.e. rent or profits). Indeed, if the employee or tenant does not

2502

provide the employer or landlord with enough profits, they will quickly

2503

be shown the door. Of course employees can start their own companies

2504

but citizens can start their own state if they convince an existing state

2505

(the owner of a set of resources) to sell/give land to them. Setting up

2506

a company also requires existing owners to sell/give resources to those

2507

who need them. Of course, in a democratic state citizens can influence

2508

the nature of laws and orders they obey. In a capitalist company, this

2509

is not the case.

2510

2511

This means that, logically, "anarcho"-capitalism must consider a series

2512

of freely exitable states as "anarchist" and not a source of domination.

2513

If consent (not leaving) is what is required to make capitalist domination

2514

not domination then the same can be said of statist domination. Stephen

2515

L. Newman makes the same point:

2516

2517

"The emphasis [right-wing] libertarians place on the opposition of liberty

2518

and political power tends to obscure the role of authority in their

2519

worldview . . . the authority exercised in private relationships, however

2520

meets with no objection. . . . [This] reveals a curious insensitivity to

2521

the use of private authority as a means of social control. Comparing public

2522

and private authority, we might well ask of the [right-wing] libertarians:

2523

When the price of exercising one's freedom is terribly high, what practical

2524

difference is there between the commands of the state and those issued

2525

by one's employer? . . . Though admittedly the circumstances are not

2526

identical, telling disgruntled empowers that they are always free to leave

2527

their jobs seems no different in principle from telling political dissidents

2528

that they are free to emigrate." [_Liberalism at Wit's End_, pp. 45-46]

2529

2530

Murray Rothbard, in his own way, agrees:

2531

2532

"*If* the State may be said too properly *own* its territory, then it is

2533

proper for it to make rules for everyone who presumes to live in that

2534

area. It can legitimately seize or control private property because there

2535

*is* no private property in its area, because it really owns the entire

2536

land surface. *So long* as the State permits its subjects to leave its

2537

territory, then, it can be said to act as does any other owner who

2538

sets down rules for people living on his property." [_The Ethics of

2539

Liberty_, p. 170]

2540

2541

Rothbard's argues that this is *not* the case simply because the state

2542

did not acquire its property in a "just" manner and that it claims

2543

rights over virgin land (both of which violates Rothbard's "homesteading"

2544

theory of property -- see section 4.1 for details and a critique).

2545

Rothbard argues that this defence of statism (the state as property owner)

2546

is unrealistic and ahistoric, but his account of the origins of property

2547

is equally unrealistic and ahistoric and that does not stop him supporting

2548

capitalism. People in glass houses should not throw stones!

2549

2550

Thus he claims that the state is evil and its claims to authority/power

2551

false simply because it acquired the resources it claims to own "unjustly"

2552

pp. 170-1, for Rothbard's attempt to explain why the state should not be

2553

considered as the owner of land). And even *if* the state *was* the

2554

owner of its territory, it cannot appropriate virgin land (although,

2555

as he notes elsewhere, the "vast" US frontier no longer exists "and

2556

there is no point crying over the fact" [Op. Cit., p. 240]).

2557

2558

So what makes hierarchy legitimate for Rothbard is whether the property

2559

it derives from was acquired justly or unjustly. Which leads us to a

2560

few *very* important points.

2561

2562

Firstly, Rothbard is explicitly acknowledging the similarities between

2563

statism and capitalism. He is arguing that *if* the state had developed

2564

in a "just" way, then it is perfectly justifiable in governing ("set[ting]

2565

down rules") those who "consent" to live on its territory in *exactly*

2566

the same why a property owner does. In other words, private property

2567

can be considered as a "justly" created state! These similarities between

2568

property and statism have long been recognised by anarchists and that

2569

is why we reject private property along with the state (Proudhon did,

2570

after all, note that "property is despotism" and well as "theft"). But,

2571

according to Rothbard, something can look like a state (i.e. be a

2572

monopoly of decision making over an area) and act like a state (i.e.

2573

set down rules for people, govern them, impose a monopoly of force)

2574

but not be a state. But if it looks like a duck and sounds like a duck,

2575

it is a duck. Claiming that the origins of the thing are what counts is

2576

irrelevant -- for example, a cloned duck is just as much a duck as

2577

a naturally born one. A statist organisation is authoritarian whether

2578

it comes from "just" or "unjust" origins. Does transforming the

2579

ownership of the land from states to capitalists *really* make the

2580

relations of domination created by the dispossession of the many

2581

less authoritarian and unfree? Of course not.

2582

2583

Secondly, much property in "actually existing" capitalism is the product

2584

(directly or indirectly) of state laws and violence ("the emergence of

2585

both agrarian and industrial capitalism in Britain [and elsewhere, we

2586

must add] . . . could not have got off the ground without resources

2587

to state violence -- legal or otherwise" [Brian Morris, _Ecology &

2588

Anarchism_, p. 190]). If state claims of ownership are invalid due to

2589

their history, then so are many others (particularly those which claim

2590

to own land). As the initial creation was illegitimate, so are the

2591

transactions which have sprung from it. Thus if state claims of property

2592

rights are invalid, so are most (if not all) capitalist claims. If the

2593

laws of the state are illegitimate, so are the rules of the capitalist.

2594

If taxation is illegitimate, then so are rent, interest and profit.

2595

Rothbard's "historical" argument against the state can also be applied

2596

to private property and if the one is unjustified, then so is the other.

2597

2598

Thirdly, *if* the state had evolved "justly" then Rothbard would actually

2599

have nothing against it! A strange position for an anarchist to take.

2600

Logically this means that if a system of corporate states evolved

2601

from the workings of the capitalist market then the "anarcho"-capitalist

2602

would have nothing against it. This can be seen from "anarcho"-capitalist

2603

support for company towns even though they have correctly been described

2604

as "industrial feudalism" (see section 6 for more on this).

2605

2606

Fourthly, Rothbard's argument implies that similar circumstances producing

2607

similar relationships of domination and unfreedom are somehow different

2608

if they are created by "just" and "unjust" means. Rothbard claims that

2609

because the property is "justly" acquired it means the authority a

2610

capitalist over his employees is totally different from that of a state

2611

over its subject. But such a claim is false -- both the subject/citizen

2612

and the employee are in a similar relationship of domination and

2613

authoritarianism. As we argued in section 2.2, how a person got

2614

into a situation is irrelevant when considering how free they are.

2615

Thus, the person who "consents" to be governed by another because all

2616

available resources are privately owned is in exactly the same situation

2617

as a person who has to join a state because all available resources are

2618

owned by one state or another. Both are unfree and are part of authoritarian

2619

relationships based upon domination.

2620

2621

And, lastly, while "anarcho"-capitalism may be a "just" society, it is

2622

definitely *not* a free one. It will be marked by extensive hierarchy,

2623

unfreedom and government, but these restrictions of freedom will be of a

2624

private nature. As Rothbard indicates, the property owner and the state

2625

create/share the same authoritarian relationships. If statism is unfree,

2626

then so is capitalism. And, we must add, how "just" is a system which

2627

undermines liberty. Can "justice" ever be met in a society in which

2628

one class has more power and freedom than another. If one party is in

2629

an inferior position, then they have little choice but to agree to the

2630

disadvantageous terms offered by the superior party (see section 3.1).

2631

In such a situation, a "just" outcome will be unlikely as any contract

2632

agreed will be skewed to favour one side over the other.

2633

2634

The implications of these points are important. We can easily imagine

2635

a situation within "anarcho"-capitalism where a few companies/people

2636

start to buy up land and form company regions and towns. After all,

2637

this *has* happened continually throughout capitalism. Thus a "natural"

2638

process may develop where a few owners start to accumulate larger and

2639

larger tracks of land "justly". Such a process does not need to result

2640

in *one* company owning the world. It is likely that a few hundred,

2641

perhaps a few thousand, could do so. But this is not a cause for

2642

rejoicing -- after all the current "market" in "unjust" states also

2643

has a few hundred competitors in it. And even if there is a large

2644

multitude of property owners, the situation for the working class is

2645

exactly the same as the citizen under current statism! Does the fact

2646

that it is "justly" acquired property that faces the worker really

2647

change the fact she must submit to the government and rules of another

2648

to gain access to the means of life?

2649

2650

When faced with anarchist criticisms that *circumstances* force workers

2651

to accept wage slavery the "anarcho"-capitalist claims that these are to

2652

be considered as objective facts of nature and so wage labour is not

2653

domination. However, the same can be said of states -- we are born into

2654

a world where states claim to own all the available land. If states are

2655

replaced by individuals or groups of individuals does this change the

2656

essential nature of our dispossession? Of course not.

2657

2658

Rothbard argues that "[o]bviously, in a free society, Smith has

2659

the ultimate decision-making power over his own just property, Jones

2660

over his, etc." [Op. Cit., p. 173] and, equally obviously, this

2661

ultimate-decision making power extends to those who *use,* but do

2662

not own, such property. But how "free" is a free society where the

2663

majority have to sell their liberty to another in order to live?

2664

Rothbard (correctly) argues that the State "uses its monopoly of

2665

force . . . to control, regulate, and coerce its hapless subjects.

2666

Often it pushes its way into controlling the morality and the very

2667

lives of its subjects." [Op. Cit., p. 171] However he fails to note

2668

that employers do exactly the same thing to their employees. This,

2669

from an anarchist perspective, is unsurprising, for (after all) the

2670

employer *is* "the ultimate decision-making power over his just

2671

property" just as the state is over its "unjust" property. That

2672

similar forms of control and regulation develop is not a surprise

2673

given the similar hierarchical relations in both structures.

2674

2675

That there is a choice in available states does not make statism

2676

any less unjust and unfree. Similarly, just because we have a choice

2677

between employers does not make wage labour any less unjust or unfree.

2678

But trying to dismiss one form of domination as flowing from "just"

2679

property while attacking the other because it flows from "unjust"

2680

property is not seeing the wood for the trees. If one reduces liberty,

2681

so does the other. Whether the situation we are in resulted from "just"

2682

or "unjust" steps is irrelevant to the restrictions of freedom we face

2683

because of them (and as we argue in section 2.5, "unjust" situations

2684

can easily flow from "just" steps).

2685

2686

The "anarcho"-capitalist insistence that the voluntary nature of an

2687

association determines whether it is anarchistic is deeply flawed -- so

2688

flawed in fact that states and state-like structures (such as capitalist

2689

firms) can be considered anarchistic! In contrast, anarchists think that

2690

the hierarchical nature of the associations we join is equally as

2691

important as its voluntary nature when determining whether it is

2692

anarchistic or statist. However this option is not available to the

2693

"anarcho"-capitalist as it logically entails that capitalist companies

2694

are to be opposed along with the state as sources of domination,

2695

oppression and exploitation.

2696

2697

2.4 But surely transactions on the market are voluntary?

2698

2699

Of course, it is usually maintained by "anarcho"-capitalists that no-one

2700

puts a gun to a worker's head to join a specific company. Yes, indeed,

2701

this is true -- workers can apply for any job they like. But the point

2702

is that the vast majority cannot avoid having to sell their liberty to

2703

others (self-employment and co-operatives *are* an option, but they

2704

account for less than 10% of the working population and are unlikely

2705

to spread due to the nature of capitalist market forces -- see section

2706

J.5.11 and J.5.12 for details). And as Bob Black pointed out, right

2707

libertarians argue that "'one can at least change jobs.' but you can't

2708

avoid having a job -- just as under statism one can at least change

2709

nationalities but you can't avoid subjection to one nation-state

2710

or another. But freedom means more than the right to change masters."

2711

[_The Libertarian as Conservative_]

2712

2713

So why do workers agree to join a company? Because circumstances force

2714

them to do so - circumstances created, we must note, by *human* actions

2715

and institutions and not some abstract "fact of nature." And if the world

2716

that humans create by their activity is detrimental to what we should

2717

value most (individual liberty and individuality) then we should consider

2718

how to *change that world for the better.* Thus "circumstances" (current

2719

"objective reality") is a valid source of unfreedom and for human

2720

investigation and creative activity -- regardless of the claims of

2721

right-Libertarians.

2722

2723

Let us look at the circumstances created by capitalism. Capitalism is

2724

marked by a class of dispossessed labourers who have nothing to sell by

2725

their labour. They are legally barred from access to the means of life

2726

and so have little option but to take part in the labour market. As

2727

Alexander Berkman put it:

2728

2729

"The law says your employer does not sell anything from you, because it

2730

is done with your consent. You have agreed to work for your boss for

2731

certain pay, he to have all that you produce . . .

2732

2733

"But did you really consent?

2734

2735

"When the highway man holds his gun to your head, you turn your valuables

2736

over to him. You 'consent' all right, but you do so because you cannot

2737

help yourself, because you are *compelled* by his gun.

2738

2739

"Are you not *compelled* to work for an employer? Your need compels you

2740

just as the highwayman's gun. You must live. . . You can't work for

2741

yourself . . .The factories, machinery, and tools belong to the

2742

employing class, so you *must* hire yourself out to that class in order

2743

to work and live. Whatever you work at, whoever your employer may be, it

2744

is always comes to the same: you must work *for him*. You can't help

2745

yourself. You are *compelled*." [_What is Communist Anarchism?_, p. 9]

2746

2747

Due to this class monopoly over the means of life, workers (usually) are

2748

at a disadvantage in terms of bargaining power -- there are more workers

2749

than jobs (see section B.4.3 and 10.2 for a discussion why this is

2750

the normal situation on the labour market).

2751

2752

As was indicated in section B.4 (How does capitalism affect liberty?),

2753

within capitalism there is no equality between owners and the dispossessed,

2754

and so property is a source of *power.* To claim that this power should be

2755

"left alone" or is "fair" is "to the anarchists. . . preposterous. Once a

2756

State has been established, and most of the country's capital privatised,

2757

the threat of physical force is no longer necessary to coerce workers

2758

into accepting jobs, even with low pay and poor conditions. To use Ayn

2759

Rand's term, 'initial force' has *already taken place,* by those who now

2760

have capital against those who do not. . . . In other words, if a thief

2761

died and willed his 'ill-gotten gain' to his children, would the children

2762

have a right to the stolen property? Not legally. So if 'property is theft,'

2763

to borrow Proudhon's quip, and the fruit of exploited labour is simply legal

2764

theft, then the only factor giving the children of a deceased capitalist a

2765

right to inherit the 'booty' is the law, the State. As Bakunin wrote,

2766

'Ghosts should not rule and oppress this world, which belongs only to

2767

the living'" [Jeff Draughn, _Between Anarchism and Libertarianism_].

2768

2769

Or, in other words, right-Libertarianism fails to "meet the charge that

2770

normal operations of the market systematically places an entire class of

2771

persons (wage earners) in circumstances that compel them to accept the

2772

terms and conditions of labour dictated by those who offer work. While

2773

it is true that individuals are formally free to seek better jobs or

2774

withhold their labour in the hope of receiving higher wages, in the end

2775

their position in the market works against them; they cannot live if they

2776

do not find employment. When circumstances regularly bestow a relative

2777

disadvantage on one class of persons in their dealings with another class,

2778

members of the advantaged class have little need of coercive measures to

2779

get what they want." [Stephen L. Newman, _Liberalism at Wit's End_,

2780

p. 130]

2781

2782

To ignore the circumstances which drive people to seek out the most

2783

"beneficial exchange" is to blind yourself to the power relationships

2784

inherent within capitalism -- power relationships created by the

2785

unequal bargaining power of the parties involved (also see section

2786

3.1). And to argue that "consent" ensures freedom is false; if you

2787

are "consenting" to be join a dictatorial organisation, you "consent"

2788

*not* to be free (and to paraphrase Rousseau, a person who renounces

2789

freedom renounces being human).

2790

2791

Which is why circumstances are important -- if someone truly wants to

2792

join an authoritarian organisation, then so be it. It is their life. But

2793

if circumstances ensure their "consent" then they are not free. The

2794

danger is, of course, that people become *accustomed* to authoritarian

2795

relationships and end up viewing them as forms of freedom. This can be

2796

seen from the state, which the vast majority support and "consent" to.

2797

And this also applies to wage labour, which many workers today accept

2798

as a "necessary evil" (like the state) but, as we indicate in section

2799

8.6, the first wave of workers viewed with horror as a form of (wage)

2800

slavery and did all that they could to avoid. In such situations all

2801

we can do is argue with them and convince them that certain forms of

2802

organisations (such as the state and capitalist firms) are an evil

2803

and urge them to change society to ensure their extinction.

2804

2805

So due to this lack of appreciation of circumstances (and the fact that

2806

people become accustomed to certain ways of life) "anarcho"-capitalism

2807

actively supports structures that restrict freedom for the many. And how

2808

is "anarcho"-capitalism *anarchist* if it generates extensive amounts of

2809

archy? It is for this reason that all anarchists support self-management

2810

within free association -- that way we maximise freedom both inside *and*

2811

outside organisations. But only stressing freedom outside organisations,

2812

"anarcho"-capitalism ends up denying freedom as such (after all, we

2813

spend most of our waking hours at work). If "anarcho"-capitalists

2814

*really* desired freedom, they would reject capitalism and become

2815

anarchists -- only in a libertarian socialist society would agreements

2816

to become a wage worker be truly voluntary as they would not be driven

2817

by circumstances to sell their liberty.

2818

2819

This means that while right-Libertarianism appears to make "choice" an ideal

2820

(which sounds good, liberating and positive) in practice it has become a

2821

"dismal politics," a politics of choice where most of the choices are bad.

2822

And, to state the obvious, the choices we are "free" to make are shaped by

2823

the differences in wealth and power in society (see section 3.1) as

2824

well as such things as "isolation paradoxes" (see section B.6) and the

2825

laws and other human institutions that exist. If we ignore the context

2826

within which people make their choices then we glorify abstract processes

2827

at the expense of real people. And, as importantly, we must add that many

2828

of the choices we make under capitalism (shaped as they are by the

2829

circumstances within which they are made), such as employment contracts,

2830

result in our "choice" being narrowed to "love it or leave it" in the

2831

organisations we create/join as a result of these "free" choices.

2832

2833

This ideological blind spot flows from the "anarcho"-capitalist definition

2834

of "freedom" as "absence of coercion" -- as workers "freely consent" to

2835

joining a specific workplace, their freedom is unrestricted. But to

2836

defend *only* "freedom from" in a capitalist society means to defend

2837

the power and authority of the few against the attempts of the many to

2838

claim their freedom and rights. To requote Emma Goldman, "'Rugged

2839

individualism' has meant all the 'individualism' for the masters . . . ,

2840

in whose name political tyranny and social oppression are defended and

2841

held up as virtues' while every aspiration and attempt of man to gain

2842

freedom . . . is denounced as . . . evil in the name of that same

2843

individualism." [_Red Emma Speaks_, p. 112]

2844

2845

In other words, its all fine and well saying (as right-libertarians do)

2846

that you aim to abolish force from human relationships but if you support

2847

an economic system which creates hierarchy (and so domination and oppression)

2848

by its very workings, "defensive" force will always be required to maintain

2849

and enforce that domination. Moreover, if one class has extensive power

2850

over another due to the systematic (and normal) workings of the market,

2851

any force used to defend that power is *automatically* "defensive". Thus

2852

to argue against the use of force and ignore the power relationships that

2853

exist within and shape a society (and so also shape the individuals within

2854

it) is to defend and justify capitalist and landlord domination and

2855

denounce any attempts to resist that domination as "initiation of

2856

force."

2857

2858

Anarchists, in contrast, oppose *hierarchy* (and so domination

2859

within relationships -- bar S&M personal relationships, which are a

2860

totally different thing altogether; they are truly voluntary and they

2861

also do not attempt to hide the power relationships involved by using

2862

economic jargon). This opposition, while also including opposition to

2863

the use of force against equals (for example, anarchists are opposed

2864

to forcing workers and peasants to join a self-managed commune or

2865

syndicate), also includes support for the attempts of those subject

2866

to domination to end it (for example, workers striking for union

2867

recognition are not "initiating force", they are fighting for their

2868

freedom).

2869

2870

In other words, apparently "voluntary" agreements can and do limit

2871

freedom and so the circumstances that drive people into them *must* be

2872

considered when deciding whether any such limitation is valid. By

2873

ignoring circumstances, "anarcho"-capitalism ends up by failing to

2874

deliver what it promises -- a society of free individuals -- and

2875

instead presents us with a society of masters and servants. The question

2876

is, what do we feel moved to insist that people enjoy? Formal, abstract

2877

(bourgeois) self-ownership ("freedom") or a more substantive control

2878

over one's life (i.e. autonomy)?

2879

2880

2.5 But surely circumstances are the result of liberty and so cannot

2881

be objected to?

2882

2883

It is often argued by right-libertarians that the circumstances we face

2884

within capitalism are the result of individual decisions (i.e. individual

2885

liberty) and so we must accept them as the expressions of these acts (the

2886

most famous example of this argument is in Nozick's _Anarchy, State, and

2887

Utopia_ pp. 161-163 where he maintains that "liberty upsets patterns").

2888

This is because whatever situation evolves from a just situation by just

2889

(i.e. non-coercive steps) is also (by definition) just.

2890

2891

However, it is not apparent that adding just steps to a just situation

2892

will result in a just society. We will illustrate with a couple of

2893

banal examples. If you add chemicals which are non-combustible together

2894

you can create a new, combustible, chemical (i.e. X becomes not-X by

2895

adding new X to it). Similarly, if you have an odd number and add another

2896

odd number to it, it becomes even (again, X becomes not-X by adding a new

2897

X to it). So it *is* very possible to go from an just state to an unjust

2898

state by just step (and it is possible to remain in an unjust state by

2899

just acts; for example if we tried to implement "anarcho"-capitalism

2900

on the existing -- unjustly created -- situation of "actually existing"

2901

capitalism it would be like having an odd number and adding even numbers

2902

to it). In other words, the outcome of "just" steps can increase inequality

2903

within society and so ensure that some acquire an unacceptable amount of

2904

power over others, via their control over resources. Such an inequality of

2905

power would create an "unjust" situation where the major are free to

2906

sell their liberty to others due to inequality in power and resources

2907

on the "free" market.

2908

2909

Ignoring this objection, we could argue (as many "anarcho"-capitalists

2910

and right-libertarians do) that the unforeseen results of human action

2911

are fine unless we assume that these human actions are in themselves bad

2912

(i.e. that individual choice is evil).

2913

2914

Such an argument is false for three reasons.

2915

2916

First, when we make our choices the aggregate impact of these choices are

2917

unknown to us -- and not on offer when we make our choices. Thus we cannot

2918

be said to "choose" these outcomes, outcomes which we may consider deeply

2919

undesirable, and so the fact that these outcomes are the result of

2920

individual choices is besides the point (if we knew the outcome

2921

we could refrain from doing them). The choices themselves, therefore,

2922

do not validate the outcome as the outcome was not part of the choices

2923

when they where made (i.e. the means do not justify the ends). In other

2924

words, private acts often have important public consequences (and

2925

"bilateral exchanges" often involve externalities for third parties).

2926

Secondly, if the outcome of individual choices is to deny or restrict

2927

individual choice on a wider scale at a later stage, then we are hardly

2928

arguing that individual choice is a bad thing. We want to arrange it so

2929

that the decisions we make now do not result in them restricting our

2930

ability to make choices in important areas of life at a latter stage.

2931

Which means we are in favour of individual choices and so liberty, not

2932

against them. Thirdly, the unforeseen or unplanned results of individual

2933

actions are not necessarily a good thing. If the aggregate outcome of

2934

individual choices harms individuals then we have a right to modify the

2935

circumstances within which choices are made and/or the aggregate results

2936

of these choices.

2937

2938

An example will show what we mean (again drawn from Haworth's excellent

2939

_Anti-Libertarianism_, p. 35). Millions of people across the world bought

2940

deodorants which caused a hole to occur in the ozone layer surrounding

2941

the Earth. The resultant of these acts created a situation in which

2942

individuals and the eco-system they inhabited were in great danger.

2943

The actual acts themselves were by no means wrong, but the aggregate

2944

impact was. A similar argument can apply to any form of pollution.

2945

Now, unless the right-Libertarian argues that skin cancer or other

2946

forms of pollution related illness are fine, its clear that the

2947

resultant of individual acts can be harmful to individuals.

2948

2949

The right-Libertarian could argue that pollution is an "initiation of

2950

force" against an individual's property-rights in their person and so

2951

individuals can sue the polluters. But hierarchy also harms the individual

2952

(see section B.1) -- and so can be considered as an infringement of

2953

their "property-rights" (i.e. liberty, to get away from the insane

2954

property fetish of right-Libertarianism). The loss of autonomy can be

2955

just as harmful to an individual as lung cancer although very different

2956

in form. And the differences in wealth resulting from hierarchy is

2957

well known to have serious impacts on life-span and health.

2958

2959

As noted in section 2.1, the market is just as man-made as pollution. This

2960

means that the "circumstances" we face are due to aggregate of millions of

2961

individual acts and these acts occur within a specific framework of rights,

2962

institutions and ethics. Anarchists think that a transformation of our

2963

society and its rights and ideals is required so that the resultant of

2964

individual choices does not have the ironic effect of limiting individual

2965

choice (freedom) in many important ways (such as in work, for example).

2966

2967

In other words, the *circumstances* created by capitalist rights and

2968

institutions requires a *transformation* of these rights and institutions

2969

in such a way as to maximise individual choice for all -- namely, to abolish

2970

these rights and replace them with new ones (for example, replace property

2971

rights with use rights). Thus Nozick's claims that "Z does choose voluntarily

2972

if the other individuals A through Y each acted voluntarily and within their

2973

rights" [Op. Cit., p. 263] misses the point -- it is these rights that are

2974

in question (given that Nozick *assumes* these rights then his whole thesis

2975

is begging the question).

2976

2977

And we must add (before anyone points it out) that, yes, we are aware that

2978

many decisions will unavoidably limit current and future choices. For

2979

example, the decision to build a factory on a green-belt area will make

2980

it impossible for people to walk through the woods that are no longer

2981

there. But such "limitations" (if they can be called that) of choice are

2982

different from the limitations we are highlighting here, namely the lose

2983

of freedom that accompanies the circumstances created via exchange in the

2984

market. The human actions which build the factory modify reality but

2985

do not generate social relationships of domination between people in

2986

so doing. The human actions of market exchange, in contrast, modify the

2987

relative strengths of everyone in society and so has a distinct impact

2988

on the social relationships we "voluntarily" agree to create. Or, to put

2989

it another way, the decision to build on the green-belt site does "limit"

2990

choice in the abstract but it does *not* limit choice in the kind of

2991

relationships we form with other people nor create authoritarian

2992

relationships between people due to inequality influencing the content

2993

of the associations we form. However, the profits produced from using the

2994

factory increases inequality (and so market/economic power) and so weakens

2995

the position of the working class in respect to the capitalist class within

2996

society. This increased inequality will be reflected in the "free"

2997

contracts and working regimes that are created, with the weaker "trader"

2998

having to compromise far more than before.

2999

3000

So, to try and defend wage slavery and other forms of hierarchy by arguing

3001

that "circumstances" are created by individual liberty runs aground on its

3002

own logic. If the circumstances created by individual liberty results in

3003

pollution then the right-Libertarian will be the first to seek to change

3004

those circumstances. They recognise that the right to pollute while producing

3005

is secondary to our right to be healthy. Similarly, if the circumstances

3006

created by individual liberty results in hierarchy (pollution of the mind

3007

and our relationships with others as opposed to the body, although it

3008

affects that to) then we are entitled to change these circumstances too

3009

and the means by which we get there (namely the institutional and rights

3010

framework of society). Our right to liberty is more important than the

3011

rights of property -- sadly, the right-Libertarian refuses to recognise

3012

this.

3013

3014

2.6 Do Libertarian-capitalists support slavery?

3015

3016

Yes. It may come as a surprise to many people, but right-Libertarianism is

3017

one of the few political theories that justifies slavery. For example, Robert

3018

Nozick asks whether "a free system would allow [the individual] to sell

3019

himself into slavery" and he answers "I believe that it would." [_Anarchy,

3020

State and Utopia_, p. 371] While some right-Libertarians do not agree with

3021

Nozick, there is no logical basis in their ideology for such disagreement.

3022

3023

The logic is simple, you cannot really own something unless you can sell

3024

it. Self-ownership is one of the cornerstones of laissez-faire capitalist

3025

ideology. Therefore, since you own yourself you can sell yourself.

3026

3027

(For Murray Rothbard's claims of the "unenforceability, in libertarian

3028

theory, of voluntary slave contracts" see _The Ethics of Liberty_, pp.

3029

134-135 -- of course, *other* libertarian theorists claim the exact

3030

opposite so "libertarian theory" makes no such claims, but nevermind!

3031

Essentially, his point revolves around the assertion that a person

3032

"cannot, in nature, sell himself into slavery and have this sale enforced

3033

- for this would mean that his future will over his own body was being

3034

surrendered in advance" and that if a "labourer remains totally subservient

3035

to his master's will voluntarily, he is not yet a slave since his submission

3036

is voluntary." [p. 40] However, as we noted in section 2, Rothbard

3037

emphasis on quitting fails to recognise that actual denial of will and

3038

control over ones own body that is explicit in wage labour. It is this

3039

failure that pro-slave contract "libertarians" stress -- as we will

3040

see, they consider the slave contract as an extended wage contract.

3041

Moreover, a modern slave contract would likely take the form of a

3042

"performance bond" [p. 136] in which the slave agrees to perform X

3043

years labour or pay their master substantial damages. The threat of

3044

damages that enforces the contract and such a "contract" Rothbard does

3045

agree is enforceable -- along with "conditional exchange" [p. 141]

3046

which could be another way of creating slave contracts.)

3047

3048

Nozick's defence of slavery should not come as a surprise to any one

3049

familiar with classical liberalism. An elitist ideology, its main rationale

3050

is to defend the liberty and power of property owners and justify unfree

3051

social relationships (such as government and wage labour) in terms of

3052

"consent." Nozick just takes it to its logical conclusion, a conclusion

3053

which Rothbard, while balking at the label used, does not actually

3054

disagree with.

3055

3056

This is because Nozick's argument is not new but, as with so many

3057

others, can be found in John Locke's work. The key difference is

3058

that Locke refused the term "slavery" and favoured "drudgery" as,

3059

for him, slavery mean a relationship "between a lawful conqueror

3060

and a captive" where the former has the power of life and death over

3061

the latter. Once a "compact" is agreed between them, "an agreement

3062

for a limited power on the one side, and obedience on the other . . .

3063

slavery ceases." As long as the master could not kill the slave, then

3064

it was "drudgery." Like Nozick, he acknowledges that "men did sell

3065

themselves; but, it is plain, this was only to drudgery, not to slavery:

3066

for, it is evident, the person sold was not under an absolute, arbitrary,

3067

despotical power: for the master could not have power to kill him, at

3068

any time, whom, at a certain time, he was obliged to let go free out

3069

of his service." [Locke, _Second Treatise of Government_, Section 24]

3070

In other words, like Rothbard, voluntary slavery was fine but just call

3071

it something else.

3072

3073

Not that Locke was bothered by involuntary slavery. He was heavily

3074

involved in the slave trade. He owned shares in the "Royal Africa

3075

Company" which carried on the slave trade for England, making a

3076

profit when he sold them. He also held a significant share in another

3077

slave company, the "Bahama Adventurers." In the "Second Treatise",

3078

Locke justified slavery in terms of "Captives taken in a just war."

3079

[Section 85] In other words, a war waged against aggressors. That, of

3080

course, had nothing to do with the *actual* slavery Locke profited from

3081

(slave raids were common, for example). Nor did his "liberal" principles

3082

stop him suggesting a constitution that would ensure that "every freeman

3083

of Carolina shall have absolute power and authority over his Negro slaves."

3084

The constitution itself was typically autocratic and hierarchical, designed

3085

explicitly to "avoid erecting a numerous democracy." [_The Works of John

3086

Locke_, vol. X, p. 196]

3087

3088

So the notion of contractual slavery has a long history within right-wing

3089

liberalism, although most refuse to call it by that name. It is of course

3090

simply embarrassment that stops Rothbard calling a spade a spade. He

3091

incorrectly assumes that slavery has to be involuntary. In fact, historically,

3092

voluntary slave contracts have been common (David Ellerman's _Property and

3093

Contract in Economics_ has an excellent overview). Any new form of voluntary

3094

slavery would be a "civilised" form of slavery and could occur when an

3095

individual would "agree" to sell themselves to themselves to another (as

3096

when a starving worker would "agree" to become a slave in return for food).

3097

In addition, the contract would be able to be broken under certain conditions

3098

(perhaps in return for breaking the contract, the former slave would have

3099

pay damages to his or her master for the labour their master would lose -

3100

a sizeable amount no doubt and such a payment could result in debt slavery,

3101

which is the most common form of "civilised" slavery. Such damages

3102

may be agreed in the contract as a "performance bond" or "conditional

3103

exchange").

3104

3105

In summary, right-Libertarians are talking about "civilised" slavery (or,

3106

in other words, civil slavery) and not forced slavery. While some may have

3107

reservations about calling it slavery, they agree with the basic concept

3108

that since people own themselves they can sell themselves as well as

3109

selling their labour for a lifetime.

3110

3111

We must stress that this is no academic debate. "Voluntary" slavery has

3112

been a problem in many societies and still exists in many countries today

3113

(particularly third world ones where bonded labour -- i.e. where debt is

3114

used to enslave people -- is the most common form). With the rise of sweat

3115

shops and child labour in many "developed" countries such as the USA,

3116

"voluntary" slavery (perhaps via debt and bonded labour) may become

3117

common in all parts of the world -- an ironic (if not surprising) result

3118

of "freeing" the market and being indifferent to the actual freedom of

3119

those within it.

3120

3121

And it is interesting to note that even Murray Rothbard is not against

3122

the selling of humans. He argued that children are the property of their

3123

parents. They can (bar actually murdering them by violence) do whatever

3124

they please with them, even sell them on a "flourishing free child market."

3125

[_The Ethics of Liberty_, p. 102] Combined with a whole hearted support

3126

for child labour (after all, the child can leave its parents if it objects

3127

to working for them) such a "free child market" could easily become a

3128

"child slave market" -- with entrepreneurs making a healthy profit selling

3129

infants to other entrepreneurs who could make profits from the toil of

3130

"their" children (and such a process did occur in 19th century Britain).

3131

Unsurprisingly, Rothbard ignores the possible nasty aspects of such a

3132

market in human flesh (such as children being sold to work in factories,

3133

homes and brothels). And, of course, such a market could see women

3134

"specialising" in producing children for it (the use of child labour

3135

during the Industrial Revolution actually made it economically sensible

3136

for families to have more children) and, perhaps, gluts and scarcities

3137

of babies due to changing market conditions. But this is besides the

3138

point.

3139

3140

Of course, this theoretical justification for slavery at the heart of an

3141

ideology calling itself "libertarianism" is hard for many right-Libertarians

3142

to accept. Some of the "anarcho"-capitalist type argue that such contracts

3143

would be very hard to enforce in their system of capitalism. This attempt

3144

to get out of the contradiction fails simply because it ignores the nature

3145

of the capitalist market. If there is a demand for slave contracts to be

3146

enforced, then companies will develop to provide that "service" (and it would

3147

be interesting to see how two "protection" firms, one defending slave contracts

3148

and another not, could compromise and reach a peaceful agreement over whether

3149

slave contracts were valid). Thus we could see a so-called "anarchist" or

3150

"free" society producing companies whose specific purpose was to hunt down

3151

escaped slaves (i.e. individuals in slave contracts who have not paid

3152

damages to their owners for freedom). Of course, perhaps Rothbard would

3153

claim that such slave contracts would be "outlawed" under his "general

3154

libertarian law code" but this is a denial of market "freedom". If slave

3155

contracts *are* "banned" then surely this is paternalism, stopping

3156

individuals from contracting out their "labour services" to whom and

3157

however long they "desire". You cannot have it both ways.

3158

3159

So, ironically, an ideology proclaiming itself to support "liberty" ends

3160

up justifying and defending slavery. Indeed, for the right-libertarian the

3161

slave contract is an exemplification, not the denial, of the individual's

3162

liberty! How is this possible? How can slavery be supported as an expression

3163

of liberty? Simple, right-Libertarian support for slavery is a symptom of

3164

a *deeper* authoritarianism, namely their uncritical acceptance of contract

3165

theory. The central claim of contract theory is that contract is the means

3166

to secure and enhance individual freedom. Slavery is the antithesis to freedom

3167

and so, in theory, contract and slavery must be mutually exclusive. However,

3168

as indicated above, some contract theorists (past and present) have included

3169

slave contracts among legitimate contracts. This suggests that contract

3170

theory cannot provide the theoretical support needed to secure and enhance

3171

individual freedom. Why is this?

3172

3173

As Carole Pateman argues, "contract theory is primarily about a way of

3174

creating social relations constituted by subordination, not about exchange."

3175

Rather than undermining subordination, contract theorists justify modern

3176

subjection -- "contract doctrine has proclaimed that subjection to a master

3177

p. 146] The question central to contract theory (and so right-Libertarianism)

3178

is not "are people free" (as one would expect) but "are people free to

3179

subordinate themselves in any manner they please." A radically different

3180

question and one only fitting to someone who does not know what liberty

3181

means.

3182

3183

Anarchists argue that not all contracts are legitimate and no free individual

3184

can make a contract that denies his or her own freedom. If an individual

3185

is able to express themselves by making free agreements then those free

3186

agreements must also be based upon freedom internally as well. Any agreement

3187

that creates domination or hierarchy negates the assumptions underlying the

3188

agreement and makes itself null and void. In other words, voluntary

3189

government is still government and the defining chararacteristic of

3190

an anarchy must be, surely, "no government" and "no rulers."

3191

3192

This is most easily seen in the extreme case of the slave contract. John

3193

Stuart Mill stated that such a contract would be "null and void." He argued

3194

that an individual may voluntarily choose to enter such a contract but

3195

in so doing "he abdicates his liberty; he foregoes any future use of it

3196

beyond that single act. He therefore defeats, in his own case, the

3197

very purpose which is the justification of allowing him to dispose of

3198

himself. . .The principle of freedom cannot require that he should be

3199

free not to be free. It is not freedom, to be allowed to alienate his

3200

freedom." He adds that "these reasons, the force of which is so

3201

conspicuous in this particular case, are evidently of far wider

3202

application." [quoted by Pateman, Op. Cit., pp. 171-2]

3203

3204

And it is such an application that defenders of capitalism fear (Mill did

3205

in fact apply these reasons wider and unsurprisingly became a supporter of

3206

a market syndicalist form of socialism). If we reject slave contracts as

3207

illegitimate then, logically, we must also reject *all* contracts that

3208

express qualities similar to slavery (i.e. deny freedom) including wage

3209

slavery. Given that, as David Ellerman points out, "the voluntary

3210

slave . . . and the employee cannot in fact take their will out of their

3211

intentional actions so that they could be 'employed' by the master or

3212

employer" we are left with "the rather implausible assertion that a

3213

person can vacate his or her will for eight or so hours a day for weeks,

3214

months, or years on end but cannot do so for a working lifetime."

3215

[_Property and Contract in Economics_, p. 58]

3216

3217

The implications of supporting voluntary slavery is quite devastating

3218

for all forms of right-wing "libertarianism." This was proven by Ellerman

3219

when he wrote an extremely robust defence of it under the pseudonym

3220

"J. Philmore" called _The Libertarian Case for Slavery_ (first published

3221

in _The Philosophical Forum_, xiv, 1982). This classic rebuttal takes the

3222

form of "proof by contradiction" (or *reductio ad absurdum*) whereby he

3223

takes the arguments of right-libertarianism to their logical end and shows

3224

how they reach the memorably conclusion that the "time has come for liberal

3225

economic and political thinkers to stop dodging this issue and to

3226

critically re-examine their shared prejudices about certain voluntary

3227

social institutions . . . this critical process will inexorably drive

3228

liberalism to its only logical conclusion: libertarianism that finally

3229

lays the true moral foundation for economic and political slavery."</i>

3230

3231

Ellerman shows how, from a right-"libertarian" perspective there is a

3232

"fundamental contradiction" in a modern liberal society for the state

3233

to prohibit slave contracts. He notes that there "seems to be a basic

3234

shared prejudice of liberalism that slavery is inherently involuntary,

3235

so the issue of genuinely voluntary slavery has received little scrutiny.

3236

The perfectly valid liberal argument that involuntary slavery is inherently

3237

unjust is thus taken to include voluntary slavery (in which case, the

3238

argument, by definition, does not apply). This has resulted in an

3239

abridgment of the freedom of contract in modern liberal society." Thus it

3240

is possible to argue for a "civilised form of contractual slavery."

3241

["J. Philmore,", Op. Cit.]

3242

3243

So accurate and logical was Ellerman's article that many of its readers

3244

were convinced it *was* written by a right-libertarian (including, we have

3245

to say, us!). One such writer was Carole Pateman, who correctly noted

3246

that "[t]here is a nice historical irony here. In the American South,

3247

slaves were emancipated and turned into wage labourers, and now

3248

American contractarians argue that all workers should have the

3249

opportunity to turn themselves into civil slaves." [Op. Cit., p. 63]).

3250

3251

The aim of Ellerman's article was to show the problems that employment (wage

3252

labour) presents for the concept of self-government and how contract need

3253

not result in social relationships based on freedom. As "Philmore" put it,

3254

"[a]ny thorough and decisive critique of voluntary slavery or constitutional

3255

nondemocratic government would carry over to the employment contract --

3256

which is the voluntary contractual basis for the free-market

3257

free-enterprise system. Such a critique would thus be a *reductio ad

3258

absurdum*." As "contractual slavery" is an "extension of the employer-employee

3259

contract," he shows that the difference between wage labour and slavery is

3260

the time scale rather than the principle or social relationships involved.

3261

[Op. Cit.] This explains, firstly, the early workers' movement called

3262

capitalism "wage slavery" (anarchists still do) and, secondly, why

3263

capitalists like Rothbard support the concept but balk at the name. It

3264

exposes the unfree nature of the system they support! While it is possible

3265

to present wage labour as "freedom" due to its "consensual" nature, it

3266

becomes much harder to do so when talking about slavery or dictatorship.

3267

Then the contradictions are exposed for all to see and be horrified by.

3268

3269

All this does not mean that we must reject free agreement. Far from it! Free

3270

agreement is *essential* for a society based upon individual dignity and

3271

liberty. There are a variety of forms of free agreement and anarchists

3272

support those based upon co-operation and self-management (i.e. individuals

3273

working together as equals). Anarchists desire to create relationships

3274

which reflect (and so express) the liberty that is the basis of free

3275

agreement. Capitalism creates relationships that deny liberty. The opposition

3276

between autonomy and subjection can only be maintained by modifying or

3277

rejecting contract theory, something that capitalism cannot do and so the

3278

right-wing Libertarian rejects autonomy in favour of subjection (and so

3279

rejects socialism in favour of capitalism).

3280

3281

The real contrast between anarchism and right-Libertarianism is best

3282

expressed in their respective opinions on slavery. Anarchism is based

3283

upon the individual whose individuality depends upon the maintenance of

3284

free relationships with other individuals. If individuals deny their

3285

capacities for self-government from themselves through a contract

3286

the individuals bring about a qualitative change in their relationship

3287

to others - freedom is turned into mastery and subordination. For the

3288

anarchist, slavery is thus the paradigm of what freedom is *not*, instead

3289

of an exemplification of what it is (as right-Libertarians state). As

3290

Proudhon argued:

3291

3292

"If I were asked to answer the following question: What is slavery?

3293

and I should answer in one word, It is murder, my meaning would be

3294

understood at once. No extended argument would be required to show that

3295

the power to take from a man his thought, his will, his personality, is a

3296

power of life and death; and that to enslave a man is to kill him." [_What

3297

is Property?_, p. 37]

3298

3299

In contrast, the right-Libertarian effectively argues that "I support slavery

3300

because I believe in liberty." It is a sad reflection of the ethical and

3301

intellectual bankruptcy of our society that such an "argument" is actually

3302

taken seriously by (some) people. The concept of "slavery as freedom" is

3303

far too Orwellian to warrant a critique - we will leave it up to right

3304

Libertarians to corrupt our language and ethical standards with an attempt

3305

to prove it.

3306

3307

From the basic insight that slavery is the opposite of freedom, the anarchist

3308

rejection of authoritarian social relations quickly follows (the right-wing

3309

Libertarians fear):

3310

3311

"Liberty is inviolable. I can neither sell nor alienate my liberty; every

3312

contract, every condition of a contract, which has in view the alienation or

3313

suspension of liberty, is null: the slave, when he plants his foot upon the

3314

soil of liberty, at that moment becomes a free man. . . Liberty is the original

3315

condition of man; to renounce liberty is to renounce the nature of man: after

3316

that, how could we perform the acts of man?" [P.J. Proudhon, Op. Cit., p. 67]

3317

3318

The employment contract (i.e. wage slavery) abrogates liberty. It is based

3319

upon inequality of power and "exploitation is a consequence of the fact

3320

that the sale of labour power entails the worker's subordination." [Carole

3321

Pateman, Op. Cit., P. 149] Hence Proudhon's (and Mill's) support of

3322

self-management and opposition to capitalism - any relationship that

3323

resembles slavery is illegitimate and no contract that creates a

3324

relationship of subordination is valid. Thus in a truly anarchistic

3325

society, slave contracts would be unenforceable -- people in a truly

3326

free (i.e. non-capitalist) society would *never* tolerate such a

3327

horrible institution or consider it a valid agreement. If someone was

3328

silly enough to sign such a contract, they would simply have to

3329

say they now rejected it in order to be free -- such contracts are

3330

made to be broken and without the force of a law system (and private

3331

defence firms) to back it up, such contracts will stay broken.

3332

3333

The right-Libertarian support for slave contracts (and wage slavery)

3334

indicates that their ideology has little to do with liberty and far more

3335

to do with justifying property and the oppression and exploitation it

3336

produces. Their support and theoretical support for slavery indicates

3337

a deeper authoritarianism which negates their claims to be libertarians.

3338

3339

2.7 But surely abolishing capitalism would restrict liberty?

3340

3341

Many "anarcho"-capitalists and other supporters of capitalism argue that

3342

it would be "authoritarian" to restrict the number of alternatives that

3343

people can choose between by abolishing capitalism. If workers become wage

3344

labourers, so it is argued, it is because they "value" other things more --

3345

otherwise they would not agree to the exchange. But such an argument

3346

ignores that reality of capitalism.

3347

3348

By *maintaining* capitalist private property, the options available

3349

to people *are* restricted. In a fully developed capitalist economy the

3350

vast majority have the "option" of selling their labour or starving/living

3351

in poverty -- self-employed workers account for less than 10% of the working

3352

population. Usually, workers are at a disadvantage on the labour market

3353

due to the existence of unemployment and so accept wage labour because

3354

otherwise they would starve (see section 10.2 for a discussion on why

3355

this is the case). And as we argue in sections J.5.11 and J.5.12,

3356

even *if* the majority of the working population desired co-operative

3357

workplaces, a capitalist market will not provide them with that outcome

3358

due to the nature of the capitalist workplace (also see Juliet C. Schor's

3359

excellent book _The Overworked American_ for a discussion of why workers

3360

desire for more free time is not reflected in the labour market). In other

3361

words, it is a myth to claim that wage labour exists or that workplaces are

3362

hierarchical because workers value other things -- they are hierarchical

3363

because bosses have more clout on the market than workers and, to use

3364

Schor's expression, workers end up wanting what they get rather than

3365

getting what they want.

3366

3367

Looking at the reality of capitalism we find that because of inequality

3368

in resources (protected by the full might of the legal system, we should

3369

note) those with property get to govern those without it during working

3370

hours (and beyond in many cases). If the supporters of capitalism were

3371

actually concerned about liberty (as opposed to property) that situation

3372

would be abhorrent to them -- after all, individuals can no longer exercise

3373

their ability to make decisions, choices, and are reduced to being order

3374

takers. If choice and liberty are the things we value, then the ability

3375

to make choices in all aspects of life automatically follows (including

3376

during work hours). However, the authoritarian relationships and the

3377

continual violation of autonomy wage labour implies are irrelevant to

3378

"anarcho"-capitalists (indeed, attempts to change this situation are

3379

denounced as violations of the autonomy of the property owner!). By

3380

purely concentrating on the moment that a contract is signed they

3381

blind themselves to the restricts of liberty that wage contracts create.

3382

3383

Of course, anarchists have no desire to *ban* wage labour -- we aim to

3384

create a society within which people are not forced by circumstances

3385

to sell their liberty to others. In order to do this, anarchists propose

3386

a modification of property and property rights to ensure true freedom of

3387

choice (a freedom of choice denied to us by capitalism). As we have

3388

noted many times, "bilateral exchanges" can and do adversely effect the

3389

position of third parties if they result in the build-up of power/money

3390

in the hands of a few. And one of these adverse effects can be the

3391

restriction of workers options due to economic power. Therefore it is

3392

the supporter of capitalist who restricts options by supporting an economic

3393

system and rights framework that by their very workings reduce the options

3394

available to the majority, who then are "free to choose" between those

3395

that remain (see also section B.4). Anarchists, in contrast, desire

3396

to expand the available options by abolishing capitalist private property

3397

rights and removing inequalities in wealth and power that help restrict

3398

our options and liberties artificially.

3399

3400

So does an anarchist society have much to fear from the spread of

3401

wage labour within it? Probably not. If we look at societies such as

3402

the early United States or the beginnings of the Industrial Revolution

3403

in Britain, for example, we find that, given the choice, most people

3404

preferred to work for themselves. Capitalists found it hard to find

3405

enough workers to employ and the amount of wages that had to be offered

3406

to hire workers were so high as to destroy any profit margins. Moreover,

3407

the mobility of workers and their "laziness" was frequently commented

3408

upon, with employers despairing at the fact workers would just work

3409

enough to make end meet and then disappear. Thus, left to the actions

3410

of the "free market," it is doubtful that wage labour would have spread.

3411

But it was not left to the "free market".

3412

3413

In response to these "problems", the capitalists turned to the state

3414

and enforced various restrictions on society (the most important being

3415

the land, tariff and money monopolies -- see section B.3 and 8). In

3416

free competition between artisan and wage labour, wage labour only

3417

succeeded due to the use of state action to create the required

3418

circumstances to discipline the labour force and to accumulate

3419

enough capital to give capitalists an edge over artisan production

3420

(see section 8 for more details).

3421

3422

Thus an anarchist society would not have to fear the spreading of

3423

wage labour within it. This is simply because would-be capitalists

3424

(like those in the early United States) would have to offer such

3425

excellent conditions, workers' control and high wages as to make

3426

the possibility of extensive profits from workers' labour nearly

3427

impossible. Without the state to support them, they will not be

3428

able to accumulate enough capital to give them an advantage within

3429

a free society. Moreover, it is somewhat ironic to hear capitalists

3430

talking about anarchism denying choice when we oppose wage labour

3431

considering the fact workers were not given any choice when the

3432

capitalists used the state to develop wage labour in the first place!

3433

3434

2.8 Why should we reject the "anarcho"-capitalist definitions of freedom

3435

and justice?

3436

3437

Simply because they lead to the creation of authoritarian social relationships

3438

and so to restrictions on liberty. A political theory which, when consistently

3439

followed, has evil or iniquitous consequences, is a bad theory.

3440

3441

For example, any theory that can justify slavery is obviously a bad theory

3442

- slavery does not cease to stink the moment it is seen to follow your

3443

theory. As right-Libertarians can justify slave contracts as a type of wage

3444

labour (see section 2.6) as well as numerous other authoritarian social

3445

relationships, it is obviously a bad theory.

3446

3447

It is worth quoting Noam Chomsky at length on this subject:

3448

3449

"Consider, for example, the 'entitlement theory of justice'. . . [a]ccording

3450

to this theory, a person has a right to whatever he has acquired by means

3451

that are just. If, by luck or labour or ingenuity, a person acquires

3452

such and such, then he is entitled to keep it and dispose of it as he

3453

wills, and a just society will not infringe on this right.

3454

3455

"One can easily determine where such a principle might lead. It is entirely

3456

possible that by legitimate means - say, luck supplemented by contractual

3457

arrangements 'freely undertaken' under pressure of need - one person

3458

might gain control of the necessities of life. Others are then free to

3459

sell themselves to this person as slaves, if he is willing to accept

3460

them. Otherwise, they are free to perish. Without extra question-begging

3461

conditions, the society is just.

3462

3463

"The argument has all the merits of a proof that 2 + 2 = 5 . . . Suppose

3464

that some concept of a 'just society' is advanced that fails to characterise

3465

the situation just described as unjust. . . Then one of two conclusions

3466

is in order. We may conclude that the concept is simply unimportant and

3467

of no interest as a guide to thought or action, since it fails to

3468

apply properly even in such an elementary case as this. Or we may conclude

3469

that the concept advanced is to be dismissed in that it fails to correspond

3470

to the pretheorectical notion that it intends to capture in clear cases.

3471

If our intuitive concept of justice is clear enough to rule social

3472

arrangements of the sort described as grossly unjust, then the sole interest

3473

of a demonstration that this outcome might be 'just' under a given 'theory

3474

of justice' lies in the inference by *reductio ad absurdum* to the

3475

conclusion that the theory is hopelessly inadequate. While it may capture

3476

some partial intuition regarding justice, it evidently neglects others.

3477

3478

"The real question to be raised about theories that fail so completely

3479

to capture the concept of justice in its significant and intuitive

3480

sense is why they arouse such interest. Why are they not simply dismissed

3481

out of hand on the grounds of this failure, which is striking in

3482

clear cases? Perhaps the answer is, in part, the one given by Edward

3483

Greenberg in a discussion of some recent work on the entitlement theory

3484

of justice. After reviewing empirical and conceptual shortcomings, he

3485

observes that such work 'plays an important function in the process of

3486

. . . 'blaming the victim,' and of protecting property against egalitarian

3487

onslaughts by various non-propertied groups.' An ideological defence of

3488

privileges, exploitation, and private power will be welcomed, regardless

3489

of its merits.

3490

3491

"These matters are of no small importance to poor and oppressed people

3492

here and elsewhere." [_The Chomsky Reader_, pp. 187-188]

3493

3494

It may be argued that the reductions in liberty associated with capitalism

3495

is not really an iniquitous outcome, but such an argument is hardly fitting

3496

for a theory proclaiming itself "libertarian." And the results of these

3497

authoritarian social relationships? To quote Adam Smith, under the capitalist

3498

division of labour the worker "has no occasion to exert his understanding, or

3499

exercise his invention" and "he naturally loses, therefore, the habit of such

3500

exercise and generally becomes as stupid and ignorant as it is possible for

3501

a human creature to become." The worker's mind falls "into that drowsy

3502

stupidity, which, in a civilised society, seems to benumb the understanding

3503

of almost all of the inferior [sic!] ranks of people." [cited by Chomsky,

3504

Op. Cit., p. 186]

3505

3506

Of course, it may be argued that these evil effects of capitalist authority

3507

relations on individuals are also not iniquitous (or that the very real

3508

domination of workers by bosses is not really domination) but that suggests

3509

a desire to sacrifice real individuals, their hopes and dreams and lives to

3510

an abstract concept of liberty, the accumulative effect of which would be

3511

to impoverish all our lives. The kind of relationships we create *within*

3512

the organisations we join are of as great an importance as their

3513

voluntary nature. Social relations *shape* the individual in many

3514

ways, restricting their freedom, their perceptions of what freedom

3515

is and what their interests actually are. This means that, in order not

3516

to be farcical, any relationships we create must reflect in their internal

3517

workings the critical evaluation and self-government that created them

3518

in the first place. Sadly capitalist individualism masks structures of

3519

power and relations of domination and subordination within seemingly

3520

"voluntary" associations -- it fails to note the relations of domination

3521

resulting from private property and so "what has been called 'individualism'

3522

up to now has been only a foolish egoism which belittles the individual.

3523

Foolish because it was not individualism at all. It did not lead to what

3524

was established as a goal; that is the complete, broad, and most perfectly

3525

attainable development of individuality." [Peter Kropotkin, _Selected

3526

Writings_, p. 297]

3527

3528

This right-Libertarian lack of concern for concrete individual freedom

3529

and individuality is a reflection of their support for "free markets" (or

3530

"economic liberty" as they sometimes phrase it). However, as Max Stirner

3531

noted, this fails to understand that "[p]olitical liberty means that the

3532

*polis,* the State, is free; . . . not, therefore, that I am free of the

3533

State. . . It does not mean *my* liberty, but the liberty of a power that

3534

rules and subjugates me; it means that one of my *despots* . . . is free."

3535

[_The Ego and Its Own_, p. 107] Thus the desire for "free markets" results

3536

in a blindness that while the market may be "free" the individuals within

3537

it may not be (as Stirner was well aware, "[u]nder the *regime* of the

3538

commonality the labourers always fall into the hands of the possessors

3539

. . . of the capitalists, therefore." [Op. Cit., p. 115])

3540

3541

In other words, right-libertarians give the greatest importance to an

3542

abstract concept of freedom and fail to take into account the fact that

3543

real, concrete freedom is the outcome of self-managed activity, solidarity

3544

and voluntary co-operation. For liberty to be real it must exist in all

3545

aspects of our daily life and cannot be contracted away without seriously

3546

effecting our minds, bodies and lives. Thus, the right-Libertarian's

3547

"defence of freedom is undermined by their insistence on the concept of

3548

negative liberty, which all too easily translates in experience as the

3549

negation of liberty." [Stephan L. Newman, _Liberalism as Wit's End_,

3550

p. 161]

3551

3552

Thus right-Libertarian's fundamental fallacy is that "contract" does not

3553

result in the end of power or domination (particularly when the bargaining

3554

power or wealth of the would-be contractors is not equal). As Carole

3555

Pateman notes, "[i]ronically, the contractarian ideal cannot encompass

3556

capitalist employment. Employment is not a continual series of discrete

3557

contracts between employer and worker, but . . . one contract in which a

3558

worker binds himself to enter an enterprise and follow the directions

3559

of the employer for the duration of the contract. As Huw Benyon has

3560

bluntly stated, 'workers are paid to obey.'" [_The Sexual Contract_,

3561

p. 148] This means that "the employment contract (like the marriage

3562

contract) is not an exchange; both contracts create social relations

3563

that endure over time - social relations of subordination." [Ibid.]

3564

3565

Authority impoverishes us all and must, therefore, be combated wherever

3566

it appears. That is why anarchists oppose capitalism, so that there shall

3567

be "no more government of man by man, by means of accumulation of capital."

3568

[P-J Proudhon, cited by Woodcock in _Anarchism_, p. 110] If, as Murray

3569

Bookchin point it, "the object of anarchism is to increase choice" [_The

3570

Ecology of Freedom_, p. 70] then this applies both to when we are creating

3571

associations/relationships with others and when we are *within* these

3572

associations/relationships -- i.e. that they are consistent with the

3573

liberty of all, and that implies participation and self-management *not*

3574

hierarchy. "Anarcho"-capitalism fails to understand this essential point

3575

and by concentrating purely on the first condition for liberty ensures a

3576

society based upon domination, oppression and hierarchy and not freedom.

3577

3578

It is unsurprising, therefore, to find that the basic unit of analysis

3579

of the "anarcho"-capitalist/right-libertarian is the transaction (the

3580

"trade," the "contract"). The freedom of the individual is seen as

3581

revolving around an act, the contract, and *not* in our relations with

3582

others. All the social facts and mechanisms that precede, surround and

3583

result from the transaction are omitted. In particular, the social

3584

relations that result from the transaction are ignored (those, and

3585

the circumstances that make people contract, are the two unmentionables

3586

of right-libertarianism).

3587

3588

For anarchists it seems strange to concentrate on the moment that a

3589

contract is signed and ignore the far longer time the contract is

3590

active for (as we noted in section A.2.14, if the worker is free when

3591

they sign a contract, slavery soon overtakes them). Yes, the voluntary

3592

nature of a decision is important, but so are the social relationships

3593

we experience due to those decisions.

3594

3595

For the anarchist, freedom is based upon the insight that other people,

3596

apart from (indeed, *because* of) having their own intrinsic value, also

3597

are "means to my end", that it is through their freedom that I gain my

3598

own -- so enriching my life. As Bakunin put it:

3599

3600

"I who want to be free cannot be because all the men around me do not yet

3601

want to be free, and consequently they become tools of oppression against

3602

me." [quoted by Errico Malatesta in _Anarchy_, p. 27]

3603

3604

Therefore anarchists argue that we must reject the right-Libertarian

3605

theories of freedom and justice because they end up supporting the

3606

denial of liberty as the expression of liberty. What this fails to

3607

recognise is that freedom is a product of social life and that (in

3608

Bakunin's words) "[n]o man can achieve his own emancipation without

3609

at the same time working for the emancipation of all men around him.

3610

My freedom is the freedom of all since I am not truly free in thought

3611

and in fact, except when my freedom and my rights are confirmed and

3612

approved in the freedom and rights of all men who are my equals."

3613

[Ibid.]

3614

3615

Other people give us the possibilities to develop our full human potentiality

3616

and thereby our freedom, so when we destroy the freedom of others we limit

3617

our own. "To treat others and oneself as property," argues anarchist L. Susan

3618

Brown, "objectifies the human individual, denies the unity of subject and

3619

object and is a negation of individual will . . . even the freedom gained

3620

by the other is compromised by this relationship, for to negate the will

3621

of another to achieve one's own freedom destroys the very freedom one

3622

sought in the first place." [_The Politics of Individualism_, p. 3]

3623

3624

Fundamentally, it is for this reason that anarchists reject the

3625

right-Libertarian theories of freedom and justice -- it just does

3626

not ensure individual freedom or individuality.

3627

3628

3 Why do anarcho"-capitalists generally place little or no value

3629

on "equality," and what do they mean by that term?

3630

3631

Murray Rothbard argues that "the 'rightist' libertarian is not opposed

3632

to inequality." [_For a New Liberty_, p. 47]In contrast, "leftist"

3633

libertarians oppose inequality because it has harmful effects on

3634

individual liberty.

3635

3636

Part of the reason "anarcho"-capitalism places little or no value on

3637

"equality" derives from their definition of that term. Murray Rothbard

3638

defines equality as:

3639

3640

"A and B are 'equal' if they are identical to each other with respect to a

3641

given attribute... There is one and only one way, then, in which any two

3642

people can really be 'equal' in the fullest sense: they must be identical

3643

in *all* their attributes." He then points out the obvious fact that "men

3644

are not uniform,. . . . the species, mankind, is uniquely characterised by a

3645

high degree of variety, diversity, differentiation: in short, inequality."

3646

[_Egalitarianism as a Revolt against Nature and Other Essays_, p. 4, p.5]

3647

3648

In others words, every individual is unique. Something no egalitarian

3649

has ever denied. On the basis of this amazing insight, he concludes that

3650

equality is impossible (except "equality of rights") and that the attempt

3651

to achieve "equality" is a "revolt against nature" -- as if any anarchist

3652

had ever advocated such a notion of equality as being identical!

3653

3654

And so, because we are all unique, the outcome of our actions will not

3655

be identical and so social inequality flows from natural differences

3656

and not due to the economic system we live under. Inequality of

3657

endowment implies inequality of outcome and so social inequality.

3658

As individual differences are a fact of nature, attempts to create

3659

a society based on "equality" (i.e. making everyone identical in terms

3660

of possessions and so forth) is impossible and "unnatural."

3661

3662

Before continuing, we must note that Rothbard is destroying language to

3663

make his point and that he is not the first to abuse language in this

3664

particular way. In George Orwell's _1984_, the expression "all men are

3665

created equal" could be translated into Newspeak, but it would make as

3666

much sense as saying "all men have red hair," an obvious falsehood

3667

(see "The Principles of Newspeak" Appendix). It's nice to know that

3668

"Mr. Libertarian" is stealing ideas from Big Brother, and for the same

3669

reason: to make critical thought impossible by restricting the meaning

3670

of words.

3671

3672

"Equality," in the context of political discussion, does not mean

3673

"identical," it usually means equality of rights, respect, worth, power

3674

and so forth. It does not imply treating everyone identically (for example,

3675

expecting an eighty year old man to do identical work to an eighteen

3676

violates treating both with respect as unique individuals). For anarchists,

3677

as Alexander Berkman writes, "equality does not mean an equal amount but

3678

equal *opportunity*. . . Do not make the mistake of identifying equality

3679

in liberty with the forced equality of the convict camp. True anarchist

3680

equality implies freedom, not quantity. It does not mean that every one

3681

must eat, drink, or wear the same things, do the same work, or live in

3682

the same manner. Far from it: the very reverse, in fact. Individual needs

3683

and tastes differ, as appetites differ. It is *equal* opportunity to satisfy

3684

them that constitutes true equality. Far from levelling, such equality opens

3685

the door for the greatest possible variety of activity and development. For

3686

human character is diverse, and only the repression of this free diversity

3687

results in levelling, in uniformity and sameness. Free opportunity and

3688

acting out your individuality means development of natural dissimilarities

3689

and variations. . . . Life in freedom, in anarchy will do more than liberate

3690

man merely from his present political and economic bondage. That will be

3691

only the first step, the preliminary to a truly human existence."

3692

[_The ABC of Anarchism_, p. 25]

3693

3694

Thus anarchists reject the Rothbardian-Newspeak definition of equality

3695

as meaningless within political discussion. No two people are identical

3696

and so imposing "identical" equality between them would mean treating

3697

them as *unequals*, i.e. not having equal worth or giving them equal

3698

respect as befits them as human beings and fellow unique individuals.

3699

3700

So what should we make of Rothbard's claim? It is tempting just to quote

3701

Rousseau when he argued "it is . . . useless to inquire whether there is any

3702

essential connection between the two inequalities [social and natural];

3703

for this would be only asking, in other words, whether those who command

3704

are necessarily better than those who obey, and if strength of body or

3705

of mind, wisdom, or virtue are always found in particular individuals,

3706

in proportion to their power or wealth: a question fit perhaps to be

3707

discussed by slaves in the hearing of their masters, but highly unbecoming

3708

to reasonable and free men in search of the truth." [_The Social Contract

3709

and Discourses_, p. 49] But a few more points should be raised.

3710

3711

The uniqueness of individuals has always existed but for the vast majority

3712

of human history we have lived in very egalitarian societies. If social

3713

inequality did, indeed, flow from natural inequalities then *all*

3714

societies would be marked by it. This is not the case. Indeed, taking

3715

a relatively recent example, many visitors to the early United States

3716

noted its egalitarian nature, something that soon changed with the rise

3717

of wage labour and industrial capitalism (a rise dependent upon state

3718

action, we must add, -- see section 8). This implies that the society

3719

we live in (its rights framework, the social relationships it generates

3720

and so forth) has a far more of a decisive impact on inequality than

3721

individual differences. Thus certain rights frameworks will tend to

3722

magnify "natural" inequalities (assuming that is the source of the

3723

initial inequality, rather than, say, violence and force). As Noam

3724

Chomsky argues:

3725

3726

"Presumably it is the case that in our 'real world' some combination of

3727

attributes is conducive to success in responding to 'the demands of the

3728

economic system' . . . One might suppose that some mixture of avarice,

3729

selfishness, lack of concern for others, aggressiveness, and similar

3730

characteristics play a part in getting ahead [in capitalism]. . . Whatever

3731

the correct collection of attributes may be, we may ask what follows

3732

from the fact, if it is a fact, that some partially inherited combination

3733

of attributes tends to material success? All that follows . . . is a

3734

comment on our particular social and economic arrangements . . . The

3735

egalitarian might responds, in all such cases, that the social order

3736

should be changes so that the collection of attributes that tends to

3737

bring success no longer do so . . . " [_The Chomsky Reader_, p. 190]

3738

3739

So, perhaps, if we change society then the social inequalities we see today

3740

would disappear. It is more than probable that natural difference has been

3741

long ago been replaced with *social* inequalities, especially inequalities

3742

of property (which will tend to increase, rather than decrease, inequality).

3743

And as we argue in section 8 these inequalities of property were initially

3744

the result of force, *not* differences in ability. Thus to claim that social

3745

inequality flows from natural differences is false as most social inequality

3746

has flown from violence and force. This initial inequality has been magnified

3747

by the framework of capitalist property rights and so the inequality within

3748

capitalism is far more dependent upon, say, the existence of wage labour,

3749

rather than "natural" differences between individuals.

3750

3751

If we look at capitalism, we see that in workplaces and across industries

3752

many, if not most, unique individuals receive identical wages for identical

3753

work (although this often is not the case for women and blacks, who receive

3754

less wages than male, white workers). Similarly, capitalists have

3755

deliberately introduced wage inequalities and hierarchies for no other

3756

reason that to divide (and so rule) the workforce (see section D.10).

3757

Thus, if we assume egalitarianism *is* a revolt against nature, then

3758

much of capitalist economic life is in such a revolt (and when it is

3759

not, the "natural" inequalities have been imposed artificially by those

3760

in power).

3761

3762

Thus "natural" differences do not necessarily result in inequality as such.

3763

Given a different social system, "natural" differences would be encouraged

3764

and celebrated far wider than they are under capitalism (where, as we

3765

argued in section B.1, hierarchy ensures the crushing of individuality

3766

rather than its encouragement) without any change in social equality.

3767

The claim that "natural" differences generates social inequalities is

3768

question begging in the extreme -- it takes the rights framework of

3769

society as a given and ignores the initial source of inequality in

3770

property and power. Indeed, inequality of outcome or reward is more

3771

likely to be influenced by social conditions rather than individual

3772

differences (as would be the case in a society based on wage labour

3773

or other forms of exploitation).

3774

3775

Another reason for "anarcho"-capitalist lack of concern for equality is

3776

that they think that "liberty upsets patterns" (see section 2.5,

3777

for example). It is argued that equality can only be maintained by

3778

restricting individual freedom to make exchanges or by taxation of

3779

income. However, what this argument fails to acknowledge is that

3780

inequality also restricts individual freedom (see next section, for

3781

example) and that the capitalist property rights framework is not

3782

the only one possible. After all, money is power and inequalities

3783

in terms of power easily result in restrictions of liberty and the

3784

transformation of the majority into order takers rather than free

3785

producers. In other words, once a certain level of inequality is

3786

reached, property does not promote, but actually conflicts with,

3787

the ends which render private property legitimate. Moreover, Nozick

3788

(in his "liberty upsets patterns" argument) "has produced . . . an

3789

argument for unrestricted private property using unrestricted private

3790

property, and thus he begs the question he tries to answer." [Andrew

3791

Kerhohan, "Capitalism and Self-Ownership", from _Capitalism_, p. 71]

3792

For example, a worker employed by a capitalist cannot freely exchange

3793

the machines or raw materials they have been provided with to use but

3794

Nozick does not class this distribution of "restricted" property rights

3795

as infringing liberty (nor does he argue that wage slavery itself

3796

restricts freedom, of course).

3797

3798

So in response to the claim that equality could only be maintained by

3799

continuously interfering with people's lives, anarchists would say that

3800

the inequalities produced by capitalist property rights also involve

3801

extensive and continuous interference with people's lives. After all, as

3802

Bob Black notes "[y]our foreman or supervisor gives you more or-else

3803

orders in a week than the police do in a decade" nevermind the other

3804

effects of inequality such as stress, ill health and so on [_Libertarian

3805

as Conservative_]. Thus claims that equality involves infringing liberty

3806

ignores the fact that inequality also infringes liberty. A reorganisation

3807

of society could effectively minimise inequalities by eliminating the

3808

major source of such inequalities (wage labour) by self-management (see

3809

section I.5.11 for a discussion of "capitalistic acts" within an anarchist

3810

society). We have no desire to restrict free exchanges (after all, most

3811

anarchists desire to see the "gift economy" become a reality sooner or

3812

later) but we argue that free exchanges need not involve the unrestricted

3813

property rights Nozick assumes. As we argue in sections 2 and 3.1,

3814

inequality can easily led to the situation where self-ownership is used

3815

to justify its own negation and so unrestricted property rights may

3816

undermine the meaningful self-determination (what anarchists would

3817

usually call "freedom" rather than self-ownership) which many people

3818

intuitively understand by the term "self-ownership".

3819

3820

Thus, for anarchists, the "anarcho"-capitalist opposition to equality

3821

misses the point and is extremely question begging. Anarchists do not

3822

desire to make humanity "identical" (which would be impossible and a

3823

total denial of liberty *and* equality) but to make the social

3824

relationships between individuals equal in *power.* In other words,

3825

they desire a situation where people interact together without

3826

institutionalised power or hierarchy and are influenced by each other

3827

"naturally," in proportion to how the (individual) *differences*

3828

between (social) *equals* are applicable in a given context. To quote

3829

Michael Bakunin, "[t]he greatest intelligence would not be equal to a

3830

comprehension of the whole. Thence results. . . the necessity of the

3831

division and association of labour. I receive and I give -- such is human

3832

life. Each directs and is directed in his turn. Therefore there is no

3833

fixed and constant authority, but a continual exchange of mutual,

3834

temporary, and, above all, voluntary authority and subordination."

3835

[_God and the State_, p. 33]

3836

3837

Such an environment can only exist within self-managed associations,

3838

for capitalism (i.e. wage labour) creates very specific relations

3839

and institutions of authority. It is for this reason anarchists are

3840

socialists (i.e. opposed to wage labour, the existence of a proletariat

3841

or working class). In other words, anarchists support equality precisely

3842

*because* we recognise that everyone is unique. If we are serious about

3843

"equality of rights" or "equal freedom" then conditions must be such

3844

that people can enjoy these rights and liberties. If we assume the right

3845

to develop one's capacities to the fullest, for example, then inequality

3846

of resources and so power within society destroys that right simply because

3847

people do not have the means to freely exercise their capacities (they

3848

are subject to the authority of the boss, for example, during work hours).

3849

3850

So, in direct contrast to anarchism, right-Libertarianism is unconcerned

3851

about any form of equality except "equality of rights". This blinds

3852

them to the realities of life; in particular, the impact of economic and

3853

social power on individuals within society and the social relationships

3854

of domination they create. Individuals may be "equal" before the law and

3855

in rights, but they may not be free due to the influence of social

3856

inequality, the relationships it creates and how it affects the law and

3857

the ability of the oppressed to use it. Because of this, all anarchists

3858

insist that equality is essential for freedom, including those in the

3859

Individualist Anarchist tradition the "anarcho"-capitalist tries to

3860

co-opt -- "Spooner and Godwin insist that inequality corrupts freedom.

3861

Their anarchism is directed as much against inequality as against tyranny"

3862

and "[w]hile sympathetic to Spooner's individualist anarchism, they

3863

[Rothbard and David Friedman] fail to notice or conveniently overlook

3864

its egalitarian implications." [Stephen L. Newman, _Liberalism at Wit's

3865

End_, p. 74, p. 76]

3866

3867

Why equality is important is discussed more fully in the next section.

3868

Here we just stress that without social equality, individual freedom is

3869

so restricted that it becomes a mockery (essentially limiting freedom

3870

of the majority to choosing *which* employer will govern them rather

3871

than being free within and outside work).

3872

3873

Of course, by defining "equality" in such a restrictive manner, Rothbard's

3874

own ideology is proved to be nonsense. As L.A. Rollins notes, "Libertarianism,

3875

the advocacy of 'free society' in which people enjoy 'equal freedom' and

3876

'equal rights,' is actually a specific form of egalitarianism. As such,

3877

Libertarianism itself is a revolt against nature. If people, by their very

3878

biological nature, are unequal in all the attributes necessary to achieving,

3879

and preserving 'freedom' and 'rights'. . . then there is no way that people

3880

can enjoy 'equal freedom' or 'equal rights'. If a free society is conceived

3881

as a society of 'equal freedom,' then there ain't no such thing as 'a

3882

free society'." [_The Myth of Natural Law_, p. 36]

3883

3884

Under capitalism, freedom is a commodity like everything else. The more

3885

money you have, the greater your freedom. "Equal" freedom, in the

3886

Newspeak-Rothbardian sense, *cannot* exist! As for "equality before the

3887

law", its clear that such a hope is always dashed against the rocks of

3888

wealth and market power (see next section for more on this). As far as

3889

rights go, of course, both the rich and the poor have an "equal right" to

3890

sleep under a bridge (assuming the bridge's owner agrees of course!); but

3891

the owner of the bridge and the homeless have *different* rights, and so

3892

they cannot be said to have "equal rights" in the Newspeak-Rothbardian

3893

sense either. Needless to say, poor and rich will not "equally" use the

3894

"right" to sleep under a bridge, either.

3895

3896

Bob Black observes in _The Libertarian as Conservative_ that "[t]he

3897

time of your life is the one commodity you can sell but never buy

3898

back. Murray Rothbard thinks egalitarianism is a revolt against

3899

nature, but his day is 24 hours long, just like everybody else's."

3900

3901

By twisting the language of political debate, the vast differences

3902

in power in capitalist society can be "blamed" not on an unjust

3903

and authoritarian system but on "biology" (we are all unique

3904

individuals, after all). Unlike genes (although biotechnology

3905

corporations are working on this, too!), human society *can* be

3906

changed, by the individuals who comprise it, to reflect the basic

3907

features we all share in common -- our humanity, our ability to

3908

think and feel, and our need for freedom.

3909

3910

3.1 Why is this disregard for equality important?

3911

3912

Simply because a disregard for equality soon ends with liberty for the

3913

majority being negated in many important ways. Most "anarcho"-capitalists

3914

and right-Libertarians deny (or at best ignore) market power. Rothbard,

3915

for example, claims that economic power does not exist; what people

3916

call "economic power" is "simply the right under freedom to refuse to

3917

make an exchange" [_The Ethics of Liberty_, p. 222] and so the concept

3918

is meaningless.

3919

3920

However, the fact is that there are substantial power centres in

3921

society (and so are the source of hierarchical power and authoritarian

3922

social relations) which are *not the state.* The central fallacy of

3923

"anarcho"-capitalism is the (unstated) assumption that the various

3924

actors within an economy have relatively equal power. This assumption

3925

has been noted by many readers of their works. For example, Peter Marshall

3926

notes that "'anarcho-capitalists' like Murray Rothbard assume individuals

3927

would have equal bargaining power in a [capitalist] market-based society"

3928

[_Demanding the Impossible_, p. 46] George Walford also makes this clear

3929

in his comments on David Friedman's _The Machinery of Freedom_:

3930

3931

"The private ownership envisages by the anarcho-capitalists would be very

3932

different from that which we know. It is hardly going too far to say that

3933

while the one is nasty, the other would be nice. In anarcho-capitalism there

3934

would be no National Insurance, no Social Security, no National Health

3935

Service and not even anything corresponding to the Poor Laws; there would be

3936

no public safety-nets at all. It would be a rigorously competitive society:

3937

work, beg or die. But as one reads on, learning that each individual would

3938

have to buy, personally, all goods and services needed, not only food,

3939

clothing and shelter but also education, medicine, sanitation, justice,

3940

police, all forms of security and insurance, even permission to use the

3941

streets (for these also would be privately owned), as one reads about all

3942

this a curious feature emerges: everybody always has enough money to buy

3943

all these things.

3944

3945

"There are no public casual wards or hospitals or hospices, but neither is

3946

there anybody dying in the streets. There is no public educational system

3947

but no uneducated children, no public police service but nobody unable to

3948

buy the services of an efficient security firm, no public law but nobody

3949

unable to buy the use of a private legal system. Neither is there anybody

3950

able to buy much more than anybody else; no person or group possesses

3951

economic power over others.

3952

3953

"No explanation is offered. The anarcho-capitalists simply take it for

3954

granted that in their favoured society, although it possesses no machinery

3955

for restraining competition (for this would need to exercise authority over

3956

the competitors and it is an *anarcho*- capitalist society) competition

3957

would not be carried to the point where anybody actually suffered from it.

3958

While proclaiming their system to be a competitive one, in which private

3959

interest rules unchecked, they show it operating as a co-operative one,

3960

in which no person or group profits at the cost of another." [_On the

3961

Capitalist Anarchists_]

3962

3963

This assumption of (relative) equality comes to the fore in Murray

3964

Rothbard's "Homesteading" concept of property (discussed in section

3965

4.1). "Homesteading" paints a picture of individuals and families

3966

doing into the wilderness to make a home for themselves, fighting

3967

against the elements and so forth. It does *not* invoke the idea

3968

of transnational corporations employing tens of thousands of people

3969

or a population without land, resources and selling their labour to

3970

others. Indeed, Rothbard argues that economic power does not exist

3971

(at least under capitalism; as we saw in section 2.1 he does make

3972

of a pro-death penalty and anti-death penalty "defence" firm coming

3973

to an agreement (see section 6.3) assumes that the firms have equal

3974

bargaining powers and resources -- if not, then the bargaining process

3975

would be very one-sided and the smaller company would think twice before

3976

taking on the larger one in battle (the likely outcome if they cannot

3977

come to an agreement on this issue) and so compromise.

3978

3979

However, the right-libertarian denial of market power is unsurprising. The

3980

necessity, not the redundancy, of equality is required if the inherent

3981

problems of contract are not to become too obvious. If some individuals

3982

*are* assumed to have significantly more power than others, and if they

3983

are always self-interested, then a contract that creates equal partners

3984

is impossible -- the pact will establish an association of masters and

3985

servants. Needless to say, the strong will present the contract as being

3986

to the advantage of both: the strong no longer have to labour (and become

3987

rich, i.e. even stronger) and the weak receive an income and so do not

3988

starve.

3989

3990

If freedom is considered as a function of ownership then it is very

3991

clear that individuals lacking property (outside their own body, of

3992

course) loses effective control over their own person and labour (which

3993

was, lets not forget, the basis of their equal natural rights). When

3994

ones bargaining power is weak (which is typically the case in the

3995

labour market) exchanges tend to magnify inequalities of wealth

3996

and power over time rather than working towards an equalisation.

3997

3998

In other words, "contract" need not replace power if the bargaining

3999

position and wealth of the would-be contractors are not equal (for, if

4000

the bargainers had equal power it is doubtful they would agree to sell

4001

control of their liberty/time to another). This means that "power" and

4002

"market" are not antithetical terms. While, in an abstract sense, all

4003

market relations are voluntary in practice this is not the case within

4004

a capitalist market. For example, a large company has a comparative

4005

advantage over small ones and communities which will definitely shape

4006

the outcome of any contract. For example, a large company or rich person

4007

will have access to more funds and so stretch out litigations and strikes

4008

until their opponents resources are exhausted. Or, if a local company is

4009

polluting the environment, the local community may put up with the damage

4010

caused out of fear that the industry (which it depends upon) would relocate

4011

to another area. If members of the community *did* sue, then the company

4012

would be merely exercising its property rights when it threatened to move

4013

to another location. In such circumstances, the community would "freely"

4014

consent to its conditions or face massive economic and social disruption.

4015

And, similarly, "the landlords' agents who threaten to discharge agricultural

4016

workers and tenants who failed to vote the reactionary ticket" in the 1936

4017

Spanish election were just exercising their legitimate property rights

4018

when they threatened working people and their families with economic

4019

uncertainty and distress. [Murray Bookchin, _The Spanish Anarchists_,

4020

p. 260]

4021

4022

If we take the labour market, it is clear that the "buyers" and "sellers"

4023

of labour power are rarely on an equal footing (if they were, then

4024

capitalism would soon go into crisis -- see section 10.2). In fact,

4025

competition "in labour markets is typically skewed in favour of

4026

employers: it is a buyer's market. And in a buyer's market, it is the

4027

sellers who compromise." [Juliet B. Schor, _The Overworked American_,

4028

p. 129] Thus the ability to refuse an exchange weights most heavily on

4029

one class than another and so ensures that "free exchange" works to

4030

ensure the domination (and so exploitation) of one party by the other.

4031

4032

Inequality in the market ensures that the decisions of the majority

4033

of within it are shaped in accordance with that needs of the powerful,

4034

not the needs of all. It was for this reason that the Individual Anarchist

4035

J.K. Ingalls opposed Henry George's proposal of nationalising the land.

4036

Ingalls was well aware that the rich could outbid the poor for leases

4037

on land and so the dispossession of the working classes would continue.

4038

4039

The market, therefore, does not end power or unfreedom -- they are still

4040

there, but in different forms. And for an exchange to be truly voluntary,

4041

both parties must have equal power to accept, reject, or influence its

4042

terms. Unfortunately, these conditions are rarely meet on the labour market

4043

or within the capitalist market in general. Thus Rothbard's argument that

4044

economic power does not exist fails to acknowledge that the rich can

4045

out-bid the poor for resources and that a corporation generally has

4046

greater ability to refuse a contract (with an individual, union or

4047

community) than vice versa (and that the impact of such a refusal is

4048

such that it will encourage the others involved to "compromise" far

4049

sooner). And in such circumstances, formally free individuals will

4050

have to "consent" to be unfree in order to survive.

4051

4052

As Max Stirner pointed out in the 1840s, free competition "is not 'free,'

4053

because I lack the *things* for competition." [_The Ego and Its Own_,

4054

p. 262] Due to this basic inequality of wealth (of "things") we find

4055

that "[u]nder the *regime* of the commonality the labourers always fall

4056

into the hands of the possessors . . . of the capitalists, therefore. The

4057

labourer cannot *realise* on his labour to the extent of the value that

4058

it has for the customer." [Op. Cit., p. 115] Its interesting to note that

4059

even Stirner recognises that capitalism results in exploitation. And we

4060

may add that value the labourer does not "realise" goes into the hands of

4061

the capitalists, who invest it in more "things" and which consolidates and

4062

increases their advantage in "free" competition.

4063

4064

To quote Stephan L. Newman:

4065

4066

"Another disquieting aspect of the libertarians' refusal to acknowledge

4067

power in the market is their failure to confront the tension between freedom

4068

and autonomy. . . Wage labour under capitalism is, of course, formally free

4069

labour. No one is forced to work at gun point. Economic circumstance, however,

4070

often has the effect of force; it compels the relatively poor to accept work

4071

under conditions dictated by owners and managers. The individual worker

4072

retains freedom [i.e. negative liberty] but loses autonomy [positive

4073

liberty]." [_Liberalism at Wit's End_, pp. 122-123]

4074

4075

(As an aside, we should point out that the full Stirner quote cited above

4076

is "[u]nder the *regime* of the commonality the labourers always fall

4077

into the hands of the possessors, of those who have at their disposal some

4078

bit of the state domains (and everything possessible in State domain belongs

4079

to the State and is only a fief of the individual), especially money and

4080

land; of the capitalists, therefore. The labourer cannot *realise* on his

4081

labour to the extent of the value that it has for the customer."

4082

4083

It could be argued that we misrepresenting Stirner by truncating the quote,

4084

but we feel that such a claim this is incorrect. Its clear from his book that

4085

Stirner is considering the "minimal" state ("The State is a - commoners'

4086

State . . . It protects man . . .according to whether the rights entrusted

4087

to him by the State are enjoyed and managed in accordance with the will,

4088

that is, laws, of the State." The State "looks on indifferently as one grows

4089

poor and the other rich, unruffled by this alternation. As *individuals*

4090

they are really equal before its face." [Op. Cit., p. 115, p. 252]). As

4091

"anarcho"-capitalists consider their system to be one of rights and

4092

laws (particularly property rights), we feel that its fair to generalise

4093

Stirner's comments into capitalism *as such* as opposed to "minimum state"

4094

capitalism. If we replace "State" by "libertarian law code" you will see

4095

what we mean. We have included this aside before any right-libertarians

4096

claim that we are misrepresenting Stirner' argument.)

4097

4098

If we consider "equality before the law" it is obvious that this also

4099

has limitations in an (materially) unequal society. Brian Morris notes

4100

that for Ayn Rand, "[u]nder capitalism . . . politics (state) and economics

4101

(capitalism) are separated . . . This, of course, is pure ideology, for

4102

Rand's justification of the state is that it 'protects' private property,

4103

that is, it supports and upholds the economic power of capitalists by

4104

coercive means." [_Ecology & Anarchism_, p. 189] The same can be said

4105

of "anarcho"-capitalism and its "protection agencies" and "general

4106

libertarian law code." If within a society a few own all the resources

4107

and the majority are dispossessed, then any law code which protects

4108

private property *automatically* empowers the owning class. Workers

4109

will *always* be initiating force if act against the code and so

4110

"equality before the law" reinforces inequality of power and wealth.

4111

4112

This means that a system of property rights protects the liberties of

4113

some people in a way which gives them an unacceptable degree of power

4114

over others. And this cannot be met merely by reaffirming the rights

4115

in question, we have to assess the relative importance of various kinds

4116

of liberty and other values we how dear.

4117

4118

Therefore right-libertarian disregard for equality is important because

4119

it allows "anarcho"-capitalism to ignore many important restrictions of

4120

freedom in society. In addition, it allows them to brush over the negative

4121

effects of their system by painting an unreal picture of a capitalist

4122

society without vast extremes of wealth and power (indeed, they often

4123

construe capitalist society in terms of an ideal -- namely artisan

4124

production -- that is really *pre*-capitalist and whose social

4125

basis has been eroded by capitalist development). Inequality shapes

4126

the decisions we have available and what ones we make -- "An 'incentive'

4127

is always available in conditions of substantial social inequality that

4128

ensure that the 'weak' enter into a contract. When social inequality

4129

prevails, questions arises about what counts as voluntary entry into

4130

a contract . . . Men and women . . . are now juridically free and equal

4131

citizens, but, in unequal social conditions, the possibility cannot be

4132

ruled out that some or many contracts create relationships that bear

4133

uncomfortable resemblances to a slave contract." [Carole Pateman,

4134

_The Sexual Contract_, p. 62]

4135

4136

This ideological confusion of right-libertarianism can also be seen from

4137

their opposition to taxation. On the one hand, they argue that taxation

4138

is wrong because it takes money from those who "earn" it and gives it to

4139

the poor. On the other hand, "free market" capitalism is assumed to be

4140

a more equal society! If taxation takes from the rich and gives to the

4141

poor, how will "anarcho"-capitalism be more egalitarian? That equalisation

4142

mechanism would be gone (of course, it could be claimed that all great

4143

riches are purely the result of state intervention skewing the "free

4144

market" but that places all their "rags to riches" stories in a strange

4145

position). Thus we have a problem, either we have relative equality or

4146

we do not. Either we have riches, and so market power, or we do not.

4147

And its clear from the likes of Rothbard, "anarcho"-capitalism will

4148

not be without its millionaires (there is, after all, apparently nothing

4149

un-libertarian about "organisation, hierarchy, wage-work, granting of

4150

funds by libertarian millionaires, and a libertarian party"). And so

4151

we are left with market power and so extensive unfreedom.

4152

4153

Thus, for a ideology that denounces egalitarianism as a "revolt against

4154

nature" it is pretty funny that they paint a picture of "anarcho"-capitalism

4155

as a society of (relative) equals. In other words, their propaganda is

4156

based on something that has never existed, and never will, namely an

4157

egalitarian capitalist society.

4158

4159

3.2 But what about "anarcho"-capitalist support for charity?

4160

4161

Yes, while being blind to impact of inequality in terms of economic and

4162

social power and influence, most right-libertarians *do* argue that the

4163

very poor could depend on charity in their system. But such a recognition

4164

of poverty does not reflect an awareness of the need for equality or the

4165

impact of inequality on the agreements we make. Quite the reverse in

4166

fact, as the existence of extensive inequality is assumed -- after all,

4167

in a society of relative equals, poverty would not exist, nor would

4168

charity be needed.

4169

4170

Ignoring the fact that their ideology hardly promotes a charitable

4171

perspective, we will raise four points. Firstly, charity will not

4172

be enough to countermand the existence and impact of vast inequalities

4173

of wealth (and so power). Secondly, it will be likely that charities

4174

will be concerned with "improving" the moral quality of the poor and

4175

so will divide them into the "deserving" (i.e. obedient) and "undeserving"

4176

(i.e. rebellious) poor. Charity will be forthcoming to the former, those

4177

who agree to busy-bodies sticking their noses into their lives. In this

4178

way charity could become another tool of economic and social power (see

4179

Oscar Wilde's _The Soul of Man Under Socialism_ for more on charity).

4180

Thirdly, it is unlikely that charity will be able to replace all the

4181

social spending conducted by the state -- to do so would require a

4182

ten-fold increase in charitable donations (and given that most

4183

right-libertarians denounce the government for making them pay taxes

4184

to help the poor, it seems unlikely that they will turn round and

4185

*increase* the amount they give). And, lastly, charity is an implicate

4186

recognition that, under capitalism, no one has the right of life -- its

4187

a privilege you have to pay for. That in itself is enough to reject the

4188

charity option. And, of course, in a system designed to secure the life

4189

and liberty of each person, how can it be deemed acceptable to leave the

4190

life and protection of even one individual to the charitable whims of

4191

others? (Perhaps it will be argued that individual's have the right to

4192

life, but not a right to be a parasite. This ignores the fact some people

4193

*cannot* work -- babies and some handicapped people -- and that, in a

4194

functioning capitalist economy, many people cannot find work all the

4195

time. Is it this recognition of that babies cannot work that prompts many

4196

right-libertarians to turn them into property? Of course, rich folk

4197

who have never done a days work in their lives are never classed as

4198

parasites, even if they inherited all their money). All things

4199

considered, little wonder that Proudhon argued that:

4200

4201

"Even charitable institutions serve the ends of those in authority

4202

marvellously well.

4203

4204

"Charity is the strongest chain by which privilege and the Government,

4205

bound to protect them, holds down the lower classes. With charity,

4206

sweeter to the heart of men, more intelligible to the poor man than

4207

the abstruse laws of Political Economy, one may dispense with justice."

4208

[_The General Idea of the Revolution_, pp. 69-70]

4209

4210

As noted, the right-libertarian (passing) acknowledgement of poverty does

4211

not mean that they recognise the existence of market power. They never

4212

ask themselves how can someone be free if their social situation is such

4213

that they are drowning in a see of usury and have to sell their labour

4214

(and so liberty) to survive.

4215

4216

4 What is the right-libertarian position on private property?

4217

4218

Right libertarians are not interested in eliminating capitalist

4219

private property and thus the authority, oppression and exploitation

4220

which goes with it. It is true that they call for an end to the state,

4221

but this is not because they are concerned about workers being exploited

4222

or oppressed but because they don't want the state to impede capitalists'

4223

"freedom" to exploit and oppress workers even more than is the case now!

4224

4225

They make an idol of private property and claim to defend absolute,

4226

"unrestricted" property rights (i.e. that property owners can do anything

4227

they like with their property, as long as it does not damage the property

4228

of others. In particular, taxation and theft are among the greatest evils

4229

possible as they involve coercion against "justly held" property). They

4230

agree with John Adams that "[t]he moment that idea is admitted into

4231

society that property is not as sacred as the Laws of God, and that

4232

there is not a force of law and public justice to protect it, anarchy

4233

and tyranny commence. Property must be sacred or liberty cannot exist."

4234

4235

But in their celebration of property as the source of liberty they

4236

ignore the fact that private property is a source of "tyranny" in itself

4237

(see sections B.1 and B.4, for example -- and please note that anarchists

4238

only object to private property, *not* individual possession, see section

4239

B.3.1). However, as much anarchists may disagree about other matters,

4240

they are united in condemning private property. Thus Proudhon argued

4241

that property was "theft" and "despotism" while Stirner indicated the

4242

religious and statist nature of private property and its impact on

4243

individual liberty when he wrote :

4244

4245

"Property in the civic sense means *sacred* property, such that I must

4246

*respect* your property... Be it ever so little, if one only has somewhat

4247

of his own - to wit, a *respected* property: The more such owners... the

4248

more 'free people and good patriots' has the State.

4249

4250

"Political liberalism, like everything religious, counts on *respect,*

4251

humaneness, the virtues of love. . . . For in practice people respect

4252

nothing, and everyday the small possessions are bought up again by greater

4253

proprietors, and the 'free people' change into day labourers." [_The Ego

4254

and Its Own_, p. 248]

4255

4256

Thus "anarcho"-capitalists reject totally one of the common (and so

4257

defining) features of all anarchist traditions -- the opposition to

4258

capitalist property. From Individualist Anarchists like Tucker to

4259

Communist-Anarchists like Bookchin, anarchists have been opposed to

4260

what Godwin termed "accumulated property." This was because it was in

4261

"direct contradiction" to property in the form of "the produce of his

4262

[the worker's] own industry" and so it allows "one man. . . [to] dispos[e]

4263

of the produce of another man's industry." [_The Anarchist Reader_,

4264

pp. 129-131] Thus, for anarchists, capitalist property is a source

4265

exploitation and domination, *not* freedom (it undermines the freedom

4266

associated with possession by created relations of domination between

4267

owner and employee).

4268

4269

Hardly surprising then the fact that, according to Murray Bookchin, Murray

4270

Rothbard "attacked me [Bookchin] as an anarchist with vigour because, as

4271

he put it, I am opposed to private property." [_The Raven_, no. 29, p. 343]

4272

4273

We will discuss Rothbard's "homesteading" justification of property in

4274

the next section. However, we will note here one aspect of right-libertarian

4275

defence of "unrestricted" property rights, namely that it easily generates

4276

evil side effects such as hierarchy and starvation. As famine expert Amartya

4277

Sen notes:

4278

4279

"Take a theory of entitlements based on a set of rights of 'ownership,

4280

transfer and rectification.' In this system a set of holdings of

4281

different people are judged to be just (or unjust) by looking at past

4282

history, and not by checking the consequences of that set of holdings.

4283

But what if the consequences are recognisably terrible? . . .[R]efer[ing]

4284

to some empirical findings in a work on famines . . . evidence [is

4285

presented] to indicate that in many large famines in the recent past,

4286

in which millions of people have died, there was no over-all decline

4287

in food availability at all, and the famines occurred precisely because

4288

of shifts in entitlement resulting from exercises of rights that are

4289

perfectly legitimate. . . . [Can] famines . . . occur with a system of

4290

rights of the kind morally defended in various ethical theories, including

4291

Nozick's. I believe the answer is straightforwardly yes, since for many

4292

people the only resource that they legitimately possess, viz. their

4293

labour-power, may well turn out to be unsaleable in the market, giving

4294

the person no command over food . . . [i]f results such as starvations

4295

and famines were to occur, would the distribution of holdings still

4296

be morally acceptable despite their disastrous consequences? There is

4297

something deeply implausible in the affirmative answer." [_Resources,

4298

Values and Development_, pp. 311-2]

4299

4300

Thus "unrestricted" property rights can have seriously bad consequences

4301

and so the existence of "justly held" property need not imply a just

4302

or free society -- far from it. The inequalities property can generate

4303

can have a serious on individual freedom (see section 3.1). Indeed,

4304

Murray Rothbard argued that the state was evil not because it restricted

4305

individual freedom but because the resources it claimed to own were

4306

not "justly" acquired. Thus right-libertarian theory judges property

4307

*not* on its impact on current freedom but by looking at past history.

4308

This has the interesting side effect of allowing its supporters to

4309

look at capitalist and statist hierarchies, acknowledge their similar

4310

negative effects on the liberty of those subjected to them but argue

4311

that one is legitimate and the other is not simply because of their

4312

history! As if this changed the domination and unfreedom that both

4313

inflict on people living today (see section 2.3 for further

4314

discussion and sections 2.8 and 4.2 for other examples of

4315

"justly acquired" property producing terrible consequences).

4316

4317

The defence of capitalist property does have one interesting side

4318

effect, namely the need arises to defend inequality and the authoritarian

4319

relationships inequality creates. In order to protect the private property

4320

needed by capitalists in order to continue exploiting the working class,

4321

"anarcho"-capitalists propose private security forces rather than state

4322

security forces (police and military) -- a proposal that is equivalent

4323

to bringing back the state under another name.

4324

4325

Due to (capitalist) private property, wage labour would still exist under

4326

"anarcho"-capitalism (it is capitalism after all). This means that "defensive"

4327

force, a state, is required to "defend" exploitation, oppression, hierarchy

4328

and authority from those who suffer them. Inequality makes a mockery of

4329

free agreement and "consent" (see section 3.1). As Peter Kropotkin

4330

pointed out long ago:

4331

4332

"When a workman sells his labour to an employer . . . it is a mockery to

4333

call that a free contract. Modern economists may call it free, but the

4334

father of political economy -- Adam Smith -- was never guilty of such

4335

a misrepresentation. As long as three-quarters of humanity are compelled

4336

to enter into agreements of that description, force is, of course,

4337

necessary, both to enforce the supposed agreements and to maintain such

4338

a state of things. Force -- and a good deal of force -- is necessary to

4339

prevent the labourers from taking possession of what they consider unjustly

4340

appropriated by the few. . . . The Spencerian party [proto-right-libertarians]

4341

perfectly well understand that; and while they advocate no force for changing

4342

the existing conditions, they advocate still more force than is now used

4343

for maintaining them. As to Anarchy, it is obviously as incompatible with

4344

plutocracy as with any other kind of -cracy." [_Anarchism and Anarchist

4345

Communism_, pp. 52-53]

4346

4347

Because of this need to defend privilege and power, "anarcho"-capitalism

4348

is best called "private-state" capitalism. This will be discussed in more

4349

detail in section 6.

4350

4351

By advocating private property, right libertarians contradict many of

4352

their other claims. For example, they say that they support the right of

4353

individuals to travel where they like. They make this claim because they

4354

assume that only the state limits free travel. But this is a false

4355

assumption. Owners must agree to let you on their land or property

4356

("people only have the right to move to those properties and lands where

4357

the owners desire to rent or sell to them." [Murray Rothbard, _The Ethics

4358

of Liberty_, p. 119]. There is no "freedom of travel" onto private property

4359

(including private roads). Therefore immigration may be just as hard under

4360

"anarcho"-capitalism as it is under statism (after all, the state, like

4361

the property owner, only lets people in whom it wants to let in). People

4362

will still have to get another property owner to agree to let them in

4363

before they can travel -- exactly as now (and, of course, they also have

4364

to get the owners of the road to let them in as well). Private property,

4365

as can be seen from this simple example, is the state writ small.

4366

4367

One last point, this ignoring of ("politically incorrect") economic and

4368

other views of dead political thinkers and activists while claiming them

4369

as "libertarians" seems to be commonplace in right-Libertarian circles. For

4370

example, Aristotle (beloved by Ayn Rand) "thought that only living things

4371

could bear fruit. Money, not a living thing, was by its nature barren, and

4372

any attempt to make it bear fruit (*tokos*, in Greek, the same word used

4373

for interest) was a crime against nature." [Marcello de Cecco, quoted

4374

by Doug Henwood, _Wall Street_, p. 41] Such opposition to interest hardly

4375

fits well into capitalism, and so either goes unmentioned or gets classed

4376

as an "error" (although we could ask why Aristotle is in error while Rand is

4377

not). Similarly, individualist anarchist opposition to capitalist property

4378

and rent, interest and profits is ignored or dismissed as "bad economics"

4379

without realising that these ideas played a key role in their politics

4380

and in ensuring that an anarchy would not see freedom corrupted by

4381

inequality. To ignore such an important concept in a person's ideas is

4382

to distort the remainder into something it is not.

4383

4384

4.1 What is wrong with a "homesteading" theory of property?

4385

4386

So how do "anarcho"-capitalists justify property? Looking at Murray

4387

Rothbard, we find that he proposes a "homesteading theory of property".

4388

In this theory it is argued that property comes from occupancy and mixing

4389

labour with natural resources (which are assumed to be unowned). Thus the

4390

world is transformed into private property, for "title to an unowned

4391

resource (such as land) comes properly only from the expenditure of

4392

labour to transform that resource into use." [_The Ethics of Liberty_,

4393

p. 63]

4394

4395

Rothbard paints a conceptual history of individuals and families

4396

forging a home in the wilderness by the sweat of their labour (its

4397

tempting to rename his theory the "immaculate conception of property"

4398

as his conceptual theory is somewhat at odds with actual historical

4399

fact).

4400

4401

Sadly for Murray Rothbard, his "homesteading" theory was refuted

4402

by Proudhon in _What is Property?_ in 1840 (along with many other

4403

justifications of property). Proudhon rightly argues that "if the

4404

liberty of man is sacred, it is equally sacred in all individuals;

4405

that, if it needs property for its objective action, that is, for its

4406

life, the appropriation of material is equally necessary for all . . .

4407

Does it not follow that if one individual cannot prevent another . . .

4408

from appropriating an amount of material equal to his own, no more can

4409

he prevent individuals to come." And if all the available resources

4410

are appropriated, and the owner "draws boundaries, fences himself in

4411

. . . Here, then, is a piece of land upon which, henceforth, no one

4412

has a right to step, save the proprietor and his friends . . . Let

4413

[this]. . . multiply, and soon the people . . . will have nowhere

4414

to rest, no place to shelter, no ground to till. They will die at

4415

the proprietor's door, on the edge of that property which was their

4416

birthright." [_What is Property?_, pp. 84-85, p. 118]

4417

4418

As Rothbard himself noted in respect to the aftermath of slavery

4419

(see section 2.1), not having access to the means of life places

4420

one the position of unjust dependency on those who do. Rothbard's

4421

theory fails because for "[w]e who belong to the proletaire class,

4422

property excommunicates us!" [P-J Proudhon, Op. Cit., p. 105] and so

4423

the vast majority of the population experience property as theft and

4424

despotism rather than as a source of liberty and empowerment (which

4425

possession gives). Thus, Rothbard's account fails to take into account

4426

the Lockean Proviso (see section B.3.4) and so, for all its intuitive

4427

appeal, ends up justifying capitalist and landlord domination (see

4428

next section on why the Lockean Proviso is important).

4429

4430

It also seems strange that while (correctly) attacking social contract

4431

theories of the state as invalid (because "no past generation can bind

4432

later generations" [Op. Cit., p. 145]) he fails to see he is doing

4433

*exactly that* with his support of private property (similarly, Ayn

4434

Rand argued that "[a]ny alleged 'right' of one man, which necessitates

4435

the violation of the right of another, is not and cannot be a right"

4436

[_Capitalism: The Unknown Ideal_, p. 325] but obviously appropriating

4437

land does violate the rights of others to walk, use or appropriate that

4438

land). Due to his support for appropriation and inheritance, he is

4439

clearly ensuring that future generations are *not* born as free as

4440

the first settlers were (after all, they cannot appropriate any land,

4441

it is all taken!). If future generations cannot be bound by past ones,

4442

this applies equally to resources and property rights. Something

4443

anarchists have long realised -- there is no defensible reason why

4444

those who first acquired property should control its use by future

4445

generations.

4446

4447

However, if we take Rothbard's theory at face value we find numerous

4448

problems with it. If title to unowned resources comes via the "expenditure

4449

of labour" on it, how can rivers, lakes and the oceans be appropriated?

4450

The banks of the rivers can be transformed, but can the river itself? How

4451

can you mix your labour with water? "Anarcho"-capitalists usually blame

4452

pollution on the fact that rivers, oceans, and so forth are unowned, but

4453

how can an individual "transform" water by their labour? Also, does fencing

4454

in land mean you have "mixed labour" with it? If so then transnational

4455

corporations can pay workers to fence in vast tracks of virgin land

4456

(such as rainforest) and so come to "own" it. Rothbard argues that this

4457

is not the case (he expresses opposition to "arbitrary claims"). He notes

4458

that it is *not* the case that "the first discoverer . . . could properly

4459

lay claim to [a piece of land] . . . [by] laying out a boundary for the

4460

area." He thinks that "their claim would still be no more than the boundary

4461

*itself*, and not to any of the land within, for only the boundary will

4462

have been transformed and used by men" [Op. Cit., p. 50f]

4463

4464

However, if the boundary *is* private property and the owner refuses others

4465

permission to cross it, then the enclosed land is inaccessible to others! If

4466

an "enterprising" right-libertarian builds a fence around the only oasis in

4467

a desert and refuses permission to cross it to travellers unless they pay

4468

his price (which is everything they own) then the person *has* appropriated

4469

the oasis without "transforming" it by his labour. The travellers have the

4470

choice of paying the price or dying (and the oasis owner is well within his

4471

rights letting them die). Given Rothbard's comments, it is probable that

4472

he will claim that such a boundary is null and void as it allows "arbitrary"

4473

claims -- although this position is not at all clear. After all, the fence

4474

builder *has* transformed the boundary and "unrestricted" property rights

4475

is what right-libertarianism is all about.

4476

4477

And, of course, Rothbard ignores the fact of economic power -- a transnational

4478

corporation can "transform" far more virgin resources in a day than a family

4479

could in a year. Transnational's "mixing their labour" with the land does

4480

not spring into mind reading Rothbard's account of property growth, but in

4481

the real world that is what will happen.

4482

4483

If we take the question of wilderness (a topic close to many eco-anarchists'

4484

and deep ecologists' hearts) we run into similar problems. Rothbard states

4485

clearly that "libertarian theory must invalidate [any] claim to ownership"

4486

of land that has "never been transformed from its natural state" (he

4487

presents an example of an owner who has left a piece of his "legally owned"

4488

land untouched). If another person appears who *does* transform the land,

4489

it becomes "justly owned by another" and the original owner cannot stop her

4490

(and should the original owner "use violence to prevent another settler from

4491

entering this never-used land and transforming it into use" they also become

4492

a "criminal aggressor"). Rothbard also stresses that he is *not* saying that

4493

land must continually be in use to be valid property [Op. Cit., pp. 63-64]

4494

(after all, that would justify landless workers seizing the land from

4495

landowners during a depression and working it themselves).

4496

4497

Now, where does that leave wilderness? In response to ecologists who oppose

4498

the destruction of the rainforest, "anarcho"-capitalists suggest that they

4499

put their money where their mouth is and *buy* rainforest land. In this way,

4500

it is claimed, rainforest will be protected (see section B.5 for why such

4501

arguments are nonsense). As ecologists desire the rainforest *because it

4502

is wilderness* they are unlikely to "transform" it by human labour (its

4503

precisely that they want to stop). From Rothbard's arguments it is fair

4504

to ask whether logging companies have a right to "transform" the virgin

4505

wilderness owned by ecologists, after all it meets Rothbard's criteria

4506

(it is still wilderness). Perhaps it will be claimed that fencing off

4507

land "transforms" it (hardly what you imagine "mixing labour" with to

4508

mean, but nevermind) -- but that allows large companies and rich

4509

individuals to hire workers to fence in vast tracks of land (and

4510

recreate the land monopoly by a "libertarian" route). But as we noted

4511

above, fencing off land does not seem to imply that it becomes property

4512

in Rothbard's theory. And, of course, fencing in areas of rainforest

4513

disrupts the local eco-system -- animals cannot freely travel, for example --

4514

which, again, is what ecologists desire to stop. Would Rothbard accept a

4515

piece of paper as "transforming" land? We doubt it (after all, in his

4516

example the wilderness owner *did* legally own it) -- and so most

4517

ecologists will have a hard time in "anarcho"-capitalism (wilderness

4518

is just not an option).

4519

4520

As an aside, we must note that Rothbard fails to realise -- and this comes

4521

from his worship of the market and his "Austrian economics" -- is that people

4522

value many things which do not appear on the market. He claims that wilderness

4523

is "valueless unused natural objects" (for it people valued them, they would

4524

use -- i.e. appropriate -- them). But unused things may be of *considerable*

4525

value to people, wilderness being a classic example. And if something *cannot*

4526

be transformed into private property, does that mean people do not value it?

4527

For example, people value community, stress free working environments,

4528

meaningful work -- if the market cannot provide these, does that mean they

4529

do not value them? Of course not (see Juliet Schor's _The Overworked American_

4530

on how working people's desire for shorter working hours was not transformed

4531

into options on the market).

4532

4533

Moreover, Rothbard's "homesteading" theory actually violates his support

4534

for unrestricted property rights. What if a property owner *wants* part

4535

of her land to remain wilderness? Their desires are violated by the

4536

"homesteading" theory (unless, of course, fencing things off equals

4537

"transforming" them, which it apparently does not). How can companies

4538

provide wilderness holidays to people if they have no right to stop

4539

settlers (including large companies) "homesteading" that wilderness?

4540

And, of course, where does Rothbard's theory leave hunter-gather or

4541

nomad societies. They *use* the resources of the wilderness, but they

4542

do not "transform" them (in this case you cannot easily tell if virgin

4543

land is empty or being used as a resource). If a troop of nomads find

4544

its traditionally used, but natural, oasis appropriated by a homesteader

4545

what are they to do? If they ignore the homesteaders claims he can call

4546

upon his "defence" firm to stop them -- and then, in true Rothbardian

4547

fashion, the homesteader can refuse to supply water to them unless they

4548

hand over all their possessions (see section 4.2 on this). And if

4549

the history of the United States (which is obviously the model for

4550

Rothbard's theory) is anything to go by, such people will become

4551

"criminal aggressors" and removed from the picture.

4552

4553

Which is another problem with Rothbard's account. It is completely

4554

ahistoric (and so, as we noted above, is more like an "immaculate

4555

conception of property"). He has transported "capitalist man" into

4556

the dawn of time and constructed a history of property based upon

4557

what he is trying to justify (not surprising, as he does this with

4558

his "Natural Law" theory too -- see section 11). What *is* interesting

4559

to note, though, is that the *actual* experience of life on the US

4560

frontier (the historic example Rothbard seems to want to claim) was

4561

far from the individualistic framework he builds upon it and (ironically

4562

enough) it was destroyed by the development of capitalism.

4563

4564

As Murray Bookchin notes, "the independence that the New England yeomanry

4565

enjoyed was itself a function of the co-operative social base from which

4566

it emerged. To barter home-grown goods and objects, to share tools and

4567

implements, to engage in common labour during harvesting time in a

4568

system of mutual aid, indeed, to help new-comers in barn-raising,

4569

corn-husking, log-rolling, and the like, was the indispensable cement

4570

that bound scattered farmsteads into a united community." [_The Third

4571

Revolution_, vol. 1, p. 233] Bookchin quotes David P. Szatmary (author

4572

of a book on Shay' Rebellion) stating that it was a society based

4573

upon "co-operative, community orientated interchanges" and not a

4574

"basically competitive society." [Ibid.]

4575

4576

Into this non-capitalist society came capitalist elements. Market forces

4577

and economic power soon resulted in the transformation of this society.

4578

Merchants asked for payment in specie which (and along with taxes)

4579

soon resulted in indebtedness and the dispossession of the homesteaders

4580

from their land and goods. In response Shay's rebellion started,

4581

a rebellion which was an important factor in the centralisation of

4582

state power in America to ensure that popular input and control over

4583

government were marginalised and that the wealthy elite and their

4584

property rights were protected against the many (see Bookchin, Op.

4585

Cit., for details). Thus the homestead system was undermined,

4586

essentially, by the need to pay for services in specie (as demanded

4587

by merchants).

4588

4589

So while Rothbard's theory as a certain appeal (reinforced by watching

4590

too many Westerns, we imagine) it fails to justify the "unrestricted"

4591

property rights theory (and the theory of freedom Rothbard derives

4592

from it). All it does is to end up justifying capitalist and landlord

4593

domination (which is probably what it was intended to do).

4594

4595

4.2 Why is the "Lockean Proviso" important?

4596

4597

Robert Nozick, in his work _Anarchy, State, and Utopia_ presented a

4598

case for private property rights that was based on what he termed

4599

the "Lockean Proviso" -- namely that common (or unowned) land and

4600

resources could be appropriated by individuals as long as the position

4601

of others is not worsen by so doing. However, if we *do* take this

4602

Proviso seriously private property rights cannot be defined (see

4603

section B.3.4 for details). Thus Nozick's arguments in favour of

4604

property rights fail.

4605

4606

Some right-libertarians, particularly those associated with the

4607

Austrian school of economics argue that we must reject the Lockean

4608

Proviso (probably due to the fact it can be used to undermine the

4609

case for absolute property rights). Their argument goes as follows:

4610

if an individual appropriates and uses a previously unused resource,

4611

it is because it has value to him/her, as an individual, to engage in

4612

such action. The individual has stolen nothing because it was previously

4613

unowned and we cannot know if other people are better or worse off, all

4614

we know is that, for whatever reason, they did not appropriate the

4615

resource ("If latecomers are worse off, well then that is their proper

4616

assumption of risk in this free and uncertain world. There is no longer

4617

a vast frontier in the United States, and there is no point crying

4618

over the fact." [Murray Rothbard, _The Ethics of Liberty_, p. 240]).

4619

4620

Hence the appropriation of resources is an essentially individualistic,

4621

asocial act -- the requirements of others are either irrelevant or

4622

unknown. However, such an argument fails to take into account *why*

4623

the Lockean Proviso has such an appeal. When we do this we see that

4624

rejecting it leads to massive injustice, even slavery.

4625

4626

However, let us start with a defence of rejecting the Proviso from a

4627

leading Austrian economist:

4628

4629

"Consider . . . the case . . . of the unheld sole water hole in the

4630

desert (which *everyone* in a group of travellers knows about), which

4631

one of the travellers, by racing ahead of the others, succeeds in

4632

appropriating . . . [This] clearly and unjustly violates the Lockean

4633

proviso. . . For us, however, this view is by no means the only one

4634

possible. We notice that the energetic traveller who appropriated

4635

all the water was not doing anything which (always ignoring, of course,

4636

prohibitions resting on the Lockean proviso itself) the other travellers

4637

were not equally free to do. The other travellers, too, could have

4638

raced ahead . . . [they] did *not* bother to race for the water . . .

4639

It does not seem obvious that these other travellers can claim that

4640

they were *hurt* by an action which they could themselves have easily

4641

taken." [Israel M. Kirzner, "Entrepreneurship, Entitlement, and Economic

4642

Justice", pp. 385-413, in _Reading Nozick_, p. 406]

4643

4644

Murray Rothbard, we should note, takes a similar position in a similar

4645

example, arguing that "the owner [of the sole oasis] is scarcely being

4646

'coercive'; in fact he is supplying a vital service, and should have

4647

the right to refuse a sale or charge whatever the customers will pay.

4648

The situation may be unfortunate for the customers, as are many situations

4649

in life." [_The Ethics of Liberty_, p. 221] (Rothbard, we should note,

4650

is relying to the right-libertarian von Hayek who -- to his credit --

4651

does maintain that this is a coercive situation; but as others, including

4652

other right-libertarians, point out, he has to change his definition

4653

of coercion/freedom to do so -- see Stephan L. Newman's _Liberalism at

4654

Wit's End_, pp. 130-134 for an excellent summary of this debate).

4655

4656

Now, we could be tempted just to rant about the evils of the right

4657

libertarian mind-frame but we will try to present a clam analysis

4658

of this position. Now, what Kirzner (and Rothbard et al) fails to note is

4659

that without the water the other travellers will die in a matter of days.

4660

The monopolist has the power of life and death over his fellow travellers.

4661

Perhaps he hates one of them and so raced ahead to ensure their death.

4662

Perhaps he just recognised the vast power that his appropriation would

4663

give him and so, correctly, sees that the other travellers would give

4664

up all their possessions and property to him in return for enough water

4665

to survive.

4666

4667

Either way, its clear that perhaps the other travellers did not "race

4668

ahead" because they were ethical people -- they would not desire to

4669

inflict such tyranny on others because they would not like it inflicted

4670

upon them.

4671

4672

Thus we can answer Kirzner's question -- "What . . . is so obviously

4673

acceptable about the Lockean proviso. . . ?" [Ibid.]

4674

4675

It is the means by which human actions are held accountable to social

4676

standards and ethics. It is the means by which the greediest, most

4677

evil and debased humans are stopped from dragging the rest of humanity

4678

down to their level (via a "race to the bottom") and inflicting untold

4679

tyranny and domination on their fellow humans. An ideology that could

4680

consider the oppression which could result from such an appropriation

4681

as "supplying a vital service" and any act to remove this tyranny as

4682

"coercion" is obviously a very sick ideology. And we may note that

4683

the right-libertarian position on this example is a good illustration

4684

of the dangers of deductive logic from assumptions (see section 1.3

4685

for more on this right-libertarian methodology) -- after all W. Duncan

4686

Reekie, in his introduction to Austrian Economics, states that "[t]o be

4687

intellectually consistent one must concede his absolute right to the

4688

oasis." [_Markets, Entrepreneurs and Liberty_, p. 181] To place ideology

4689

before people is to ensure humanity is placed on a Procrustean bed.

4690

4691

Which brings us to another point. Often right-libertarians say that

4692

anarchists and other socialists are "lazy" or "do not want to work".

4693

You could interpret Kirzner's example as saying that the other

4694

travellers are "lazy" for not rushing ahead and appropriating the

4695

oasis. But this is false. For under capitalism you can only get rich

4696

by exploiting the labour of others via wage slavery or, within a

4697

company, get better pay by taking "positions of responsibility"

4698

(i.e. management positions). If you have an ethical objection to

4699

treating others as objects ("means to an end") then these options

4700

are unavailable to you. Thus anarchists and other socialists are

4701

not "lazy" because they are not rich -- they just have no desire to

4702

get rich off the labour and liberty of others (as expressed in their

4703

opposition to private property and the relations of domination it

4704

creates). In other words, Anarchism is not the "politics of envy";

4705

it is the politics of liberty and the desire to treat others as

4706

"ends in themselves".

4707

4708

Rothbard is aware of what is involved in accepting the Lockean Proviso

4709

to the outlawry of *all* private property of land, since one can always

4710

say that the reduction of available land leaves everyone else . . .

4711

worse off", _The Ethics of Liberty_, p. 240 -- see section B.3.4 for

4712

a discussion on why the Proviso *does* imply the end of capitalist

4713

property rights). Which is why he, and other right-libertarians, reject

4714

it. Its simple. Either you reject the Proviso and embrace capitalist

4715

property rights (and so allow one class of people to be dispossessed

4716

and another empowered at their expense) or you reject private property

4717

in favour of possession and liberty. Anarchists, obviously, favour

4718

the latter option.

4719

4720

As an aside, we should point out that (following Stirner) the would-be

4721

monopolist is doing nothing wrong (as such) in attempting to monopolise

4722

the oasis. He is, after all, following his self-interest. However, what

4723

is objectionable is the right-libertarian attempt to turn thus act into

4724

a "right" which must be respected by the other travellers. Simply put,

4725

if the other travellers gang up and dispose of this would be tyrant

4726

then they are right to do so -- to argue that this is a violation of

4727

the monopolists "rights" is insane and an indication of a slave

4728

mentality (or, following Rousseau, that the others are "simple").

4729

Of course, if the would-be monopolist has the necessary *force* to

4730

withstand the other travellers then his property then the matter is

4731

closed -- might makes right. But to worship rights, even when they

4732

obviously result in despotism, is definitely a case of "spooks in

4733

the head" and "man is created for the Sabbath" not "the Sabbath

4734

is created for man."

4735

4736

4.3 How does private property effect individualism?

4737

4738

Private property is usually associated by "anarcho"-capitalism with

4739

individualism. Usually private property is seen as the key way of

4740

ensuring individualism and individual freedom (and that private

4741

property is the expression of individualism). Therefore it is useful

4742

to indicate how private property can have a serious impact on

4743

individualism.

4744

4745

Usually right-libertarians contrast the joys of "individualism" with

4746

the evils of "collectivism" in which the individual is sub-merged into

4747

the group or collective and is made to work for the benefit of the

4748

group (see any Ayn Rand book or essay on the evils of collectivism).

4749

4750

But what is ironic is that right-libertarian ideology creates a view

4751

of industry which would (perhaps) shame even the most die-hard fan of

4752

Stalin. What do we mean? Simply that right-libertarians stress the

4753

abilities of the people at the top of the company, the owner, the

4754

entrepreneur, and tend to ignore the very real subordination of those

4755

lower down the hierarchy (see, again, any Ayn Rand book on the worship

4756

of business leaders). In the Austrian school of economics, for example,

4757

the entrepreneur is considered the driving force of the market process

4758

and tend to abstract away from the organisations they govern. This

4759

approach is usually followed by right-libertarians. Often you get the

4760

impression that the accomplishments of a firm are the personal triumphs

4761

of the capitalists, as though their subordinates are merely tools not

4762

unlike the machines on which they labour.

4763

4764

We should not, of course, interpret this to mean that right-libertarians

4765

believe that entrepreneurs run their companies single-handedly (although

4766

you do get that impression sometimes!). But these abstractions help hide

4767

the fact that the economy is overwhelmingly interdependent and organised

4768

hierarchically within industry. Even in their primary role as organisers,

4769

entrepreneurs depend on the group. A company president can only issue

4770

general guidelines to his managers, who must inevitably organise and

4771

direct much of their departments on their own. The larger a company gets,

4772

the less personal and direct control an entrepreneur has over it. They must

4773

delegate out an increasing share of authority and responsibility, and is

4774

more dependent than ever on others to help him run things, investigate

4775

conditions, inform policy, and make recommendations. Moreover, the

4776

authority structures are from the "top-down" -- indeed the firm is

4777

essentially a command economy, with all members part of a collective

4778

working on a common plan to achieve a common goal (i.e. it is essentially

4779

collectivist in nature -- which means it is not too unsurprising that Lenin

4780

argued that state socialism could be considered as one big firm or office

4781

and why the system he built on that model was so horrific).

4782

4783

So the firm (the key component of the capitalist economy) is marked

4784

by a distinct *lack* of individualism, a lack usually ignored by right

4785

libertarians (or, at best, considered as "unavoidable"). As these firms

4786

are hierarchical structures and workers are paid to obey, it does make

4787

*some* sense -- in a capitalist environment -- to assume that the

4788

entrepreneur is the main actor, but as an individualistic model of

4789

activity it fails totally. Perhaps it would not be unfair to say that

4790

capitalist individualism celebrates the entrepreneur because this

4791

reflects a hierarchical system in which for the one to flourish, the

4792

many must obey? (Also see section 1.1).

4793

4794

Capitalist individualism does not recognise the power structures that

4795

exist within capitalism and how they affect individuals. In Brian

4796

Morris' words, what they fail "to recognise is that most productive

4797

relations under capitalism allow little scope for creativity and

4798

self-expression on the part of workers; that such relationships

4799

are not equitable; nor are they freely engaged in for the mutual

4800

benefit of both parties, for workers have no control over the

4801

production process or over the product of their labour. Rand [like

4802

other right-libertarians] misleadingly equates trade, artistic

4803

production and wage-slavery. . . [but] wage-slavery . . . is quite

4804

different from the trade principle" as it is a form of "exploitation"

4805

[_Ecology & Anarchism_, p. 190]

4806

4807

He further notes that "[s]o called trade relations involving human

4808

labour are contrary to the egoist values Rand [and other capitalist

4809

individualists] espouses - they involve little in the way of

4810

independence, freedom, integrity or justice." [Ibid., p. 191]

4811

4812

Moreover, capitalist individualism actually *supports* authority and

4813

hierarchy. As Joshua Chen and Joel Rogers point out, the "achievement

4814

of short-run material satisfaction often makes it irrational [from

4815

an individualist perspective] to engage in more radical struggle, since

4816

that struggle is by definition against those institutions which

4817

provide one's current gain." In other words, to rise up the company

4818

structure, to "better oneself," (or even get a good reference) you

4819

cannot be a pain in the side of management -- obedient workers do

4820

well, rebel workers do not.

4821

4822

Thus the hierarchical structures help develop an "individualistic"

4823

perspective which actually reinforces those authority structures.

4824

This, as Cohn and Rogers notes, means that "the structure in which

4825

[workers] find themselves yields less than optimal social results

4826

from their isolated but economically rational decisions." [quoted

4827

by Alfie Kohn, _No Contest_, p. 67, p. 260f]

4828

4829

Steve Biko, a black activist murdered by the South African police

4830

in the 1970s, argued that "the most potent weapon of the oppressor

4831

is the mind of the oppressed." And this is something capitalists

4832

have long recognised. Their investment in "Public Relations" and

4833

"education" programmes for their employees shows this clearly,

4834

as does the hierarchical nature of the firm. By having a ladder

4835

to climb, the firm rewards obedience and penalises rebellion. This

4836

aims at creating a mind-set which views hierarchy as good and so

4837

helps produce servile people.

4838

4839

This is why anarchists would agree with Alfie Kohn when he argues that

4840

"the individualist worldview is a profoundly conservative doctrine: it

4841

inherently stifles change." [Ibid., p. 67] So, what is the best way

4842

for a boss to maintain his or her power? Create a hierarchical workplace

4843

and encourage capitalist individualism (as capitalist individualism

4844

actually works *against* attempts to increase freedom from hierarchy).

4845

Needless to say, such a technique cannot work forever -- hierarchy

4846

also encourages revolt -- but such divide and conquer can be *very*

4847

effective.

4848

4849

And as anarchist author Michael Moorcock put it, "Rugged individualism

4850

also goes hand in hand with a strong faith in paternalism -- albeit a

4851

tolerant and somewhat distant paternalism -- and many otherwise

4852

sharp-witted libertarians seem to see nothing in the morality of a

4853

John Wayne Western to conflict with their views. Heinlein's paternalism

4854

is at heart the same as Wayne's. . . To be an anarchist, surely, is

4855

to reject authority but to accept self-discipline and community

4856

responsibility. To be a rugged individualist a la Heinlein and

4857

others is to be forever a child who must obey, charm and cajole

4858

to be tolerated by some benign, omniscient father: Rooster Coburn

4859

shuffling his feet in front of a judge he respects for his office

4860

(but not necessarily himself) in True Grit." [_Starship Stormtroopers_]

4861

4862

One last thing, don't be fooled into thinking that individualism or concern

4863

about individuality -- not *quite* the same thing -- is restricted to the

4864

right, they are not. For example, the "individualist theory of society . . .

4865

might be advanced in a capitalist or in an anti-capitalist form . . . the

4866

theory as developed by critics of capitalism such as Hodgskin and the

4867

anarchist Tucker saw ownership of capital by a few as an obstacle to

4868

genuine individualism, and the individualist ideal was realisable only

4869

through the free association of labourers (Hodgskin) or independent

4870

proprietorship (Tucker)." [David Miller, _Social Justice_, pp. 290-1]

4871

4872

And the reason why social anarchists oppose capitalism is that it creates

4873

a *false* individualism, an abstract one which crushes the individuality

4874

of the many and justifies (and supports) hierarchical and authoritarian

4875

social relations. In Kropotkin's words, "what has been called 'individualism'

4876

up to now has been only a foolish egoism which belittles the individual.

4877

It did not led to what it was established as a goal: that is the complete,

4878

broad, and most perfectly attainable development of individuality." The

4879

new individualism desired by Kropotkin "will not consist . . . in the

4880

oppression of one's neighbour . . . [as this] reduced the [individualist]

4881

. . . to the level of an animal in a herd." [_Selected Writings_, p, 295,

4882

p. 296]

4883

4884

4.4 How does private property affect relationships?

4885

4886

Obviously, capitalist private property affects relationships between people

4887

by creating structures of power. Property, as we have argued all through

4888

this FAQ, creates relationships based upon domination -- and this cannot

4889

help but produce servile tendencies within those subject to them (it also

4890

produces rebellious tendencies as well, the actual ratio between the two

4891

tendencies dependent on the individual in question and the community they

4892

are in). As anarchists have long recognised, power corrupts -- both those

4893

subjected to it and those who exercise it.

4894

4895

While few, if any, anarchists would fail to recognise the importance of

4896

possession -- which creates the necessary space all individuals need to

4897

be themselves -- they all agree that private property corrupts this

4898

liberatory aspect of "property" by allowing relationships of domination

4899

and oppression to be built up on top of it. Because of this recognition,

4900

all anarchists have tried to equalise property and turn it back into

4901

possession.

4902

4903

Also, capitalist individualism actively builds barriers between people.

4904

Under capitalism, money rules and individuality is expressed via

4905

consumption choices (i.e. money). But money does not encourage an

4906

empathy with others. As Frank Stronach (chair of Magna International,

4907

a Canadian auto-parts maker that shifted its production to Mexico)

4908

put it, "[t]o be in business your first mandate is to make money, and

4909

money has no heart, no soul, conscience, homeland." [cited by Doug

4910

Henwood, _Wall Street_, p. 113] And for those who study economics,

4911

it seems that this dehumanising effect also strikes them as well:

4912

4913

"Studying economics also seems to make you a nastier person. Psychological

4914

studies have shown that economics graduate students are more likely to

4915

'free ride' -- shirk contributions to an experimental 'public goods'

4916

account in the pursuit of higher private returns -- than the general

4917

public. Economists also are less generous that other academics in

4918

charitable giving. Undergraduate economics majors are more likely to

4919

defect in the classic prisoner's dilemma game that are other majors.

4920

And on other tests, students grow less honest -- expressing less of

4921

a tendency, for example, to return found money -- after studying

4922

economics, but not studying a control subject like astronomy.

4923

4924

"This is no surprise, really. Mainstream economics is built entirely

4925

on a notion of self-interested individuals, rational self-maximisers

4926

who can order their wants and spend accordingly. There's little room

4927

for sentiment, uncertainty, selflessness, and social institutions.

4928

Whether this is an accurate picture of the average human is open to

4929

question, but there's no question that capitalism as a system and

4930

economics as a discipline both reward people who conform to the

4931

model." [Doug Henwood, Op. Cit., p, 143]

4932

4933

Which, of course, highlights the problems within the "trader" model

4934

advocated by Ayn Rand. According to her, the trader is *the* example

4935

of moral behaviour -- you have something I want, I have something you

4936

want, we trade and we both benefit and so our activity is self-interested

4937

and no-one sacrifices themselves for another. While this has *some*

4938

intuitive appeal it fails to note that in the real world it is a pure

4939

fantasy. The trader wants to get the best deal possible for themselves

4940

and if the bargaining positions are unequal then one person will gain

4941

at the expense of the other (if the "commodity" being traded is labour,

4942

the seller may not even have the option of not trading at all). The

4943

trader is only involved in economic exchange, and has no concern for

4944

the welfare of the person they are trading with. They are a bearer of

4945

things, *not* an individual with a wide range of interests, concerns,

4946

hopes and dreams. These are irrelevant, unless you can make money out

4947

of them of course! Thus the trader is often a manipulator and outside

4948

novels it most definitely is a case of "buyer beware!"

4949

4950

If the trader model is taken as the basis of interpersonal relationships,

4951

economic gain replaces respect and empathy for others. It replaces human

4952

relationships with relationships based on things -- and such a mentality

4953

does not encompass how interpersonal relationships affect both you

4954

and the society you life in. In the end, it impoverishes society and

4955

individuality. Yes, any relationship must be based upon self-interest

4956

(mutual aid is, after all, something we do because we benefit from it

4957

in some way) but the trader model presents such a *narrow* self-interest

4958

that it is useless and actively impoverishes the very things it should be

4959

protecting -- individuality and interpersonal relationships (see section

4960

I.7.4 on how capitalism does not protect individuality).

4961

4962

4.5 Does private property co-ordinate without hierarchy?

4963

4964

It is usually to find right-libertarians maintain that private property

4965

(i.e. capitalism) allows economic activity to be co-ordinated by

4966

non-hierarchical means. In other words, they maintain that capitalism

4967

is a system of large scale co-ordination without hierarchy. These

4968

claims follow the argument of noted right-wing, "free market"

4969

economist Milton Friedman who contrasts "central planning involving

4970

the use of coercion - the technique of the army or the modern

4971

totalitarian state" with "voluntary co-operation between

4972

individuals - the technique of the marketplace" as two distinct

4973

ways of co-ordinating the economic activity of large groups

4974

("millions") of people. [_Capitalism and Freedom_, p. 13]

4975

4976

However, this is just playing with words. As they themselves point

4977

out the internal structure of a corporation or capitalist company

4978

is *not* a "market" (i.e. non-hierarchical) structure, it is a

4979

"non-market" (hierarchical) structure of a market participant

4980

(see section 2.2). However "market participants" are part of

4981

the market. In other words, capitalism is *not* a system of

4982

co-ordination without hierarchy because it does contain hierarchical

4983

organisations which *are an essential part of the system*!

4984

4985

Indeed, the capitalist company *is* a form of central planning and

4986

shares the same "technique" as the army. As the pro-capitalist writer

4987

Peter Drucker noted in his history of General Motors, "[t]here is a

4988

remarkably close parallel between General Motors' scheme of organisation

4989

and those of the two institutions most renowned for administrative

4990

efficiency: that of the Catholic Church and that of the modern army . . ."

4991

[quoted by David Enger, _Apostles of Greed_, p. 66] And so capitalism

4992

is marked by a series of totalitarian organisations -- and since when

4993

was totalitarianism liberty enhancing? Indeed, many "anarcho"-capitalists

4994

actually celebrate the command economy of the capitalist firm as being

4995

more "efficient" than self-managed firms (usually because democracy

4996

stops action with debate). The same argument is applied by the Fascists

4997

to the political sphere. It does not change much -- nor does it become

4998

less fascistic -- when applied to economic structures. To state the

4999

obvious, such glorification of workplace dictatorship seems somewhat

5000

at odds with an ideology calling itself "libertarian" or "anarchist".

5001

Is dictatorship more liberty enhancing to those subject to it than

5002

democracy? Anarchists doubt it (see section A.2.11 for details).

5003

5004

In order to claim that capitalism co-ordinates individual activity

5005

without hierarchy right-libertarians have to abstract from individuals

5006

and how they interact *within* companies and concentrate purely on

5007

relationships *between* companies. This is pure sophistry. Like markets,

5008

companies require at least two or more people to work - both are forms

5009

of social co-operation. If co-ordination within companies is hierarchical,

5010

then the system they work within is based upon hierarchy. To claim that

5011

capitalism co-ordinates without hierarchy is simply false - its based

5012

on hierarchy and authoritarianism. Capitalist companies are based upon

5013

denying workers self-government (i.e. freedom) during work hours. The

5014

boss tells workers what to do, when to do, how to do and for how long.

5015

This denial of freedom is discussed in greater depth in sections B.1

5016

and B.4.

5017

5018

Because of the relations of power it creates, opposition to capitalist

5019

private property (and so wage labour) and the desire to see it ended

5020

is an essential aspect of anarchist theory. Due to its ideological

5021

blind spot with regards to apparently "voluntary" relations of

5022

domination and oppression created by the force of circumstances

5023

(see section 2 for details), "anarcho"-capitalism considers

5024

wage labour as a form of freedom and ignore its fascistic aspects

5025

(when not celebrating those aspects). Thus "anarcho"-capitalism is not

5026

anarchist. By concentrating on the moment the contract is signed, they

5027

ignore that freedom is restricted during the contract itself. While

5028

denouncing (correctly) the totalitarianism of the army, they ignore

5029

it in the workplace. But factory fascism is just as freedom destroying

5030

as the army or political fascism.

5031

5032

Due to this basic lack of concern for freedom, "anarcho"-capitalists

5033

cannot be considered as anarchists. Their total lack of concern

5034

about factory fascism (i.e. wage labour) places them totally outside

5035

the anarchist tradition. Real anarchists have always been aware of that

5036

private property and wage labour restriction freedom and desired to

5037

create a society in which people would be able to avoid it. In other

5038

words, where *all* relations are non-hierarchical and truly co-operative.

5039

5040

To conclude, to claim that private property eliminates hierarchy is false.

5041

Nor does capitalism co-ordinate economic activities without hierarchical

5042

structures. For this reason anarchists support co-operative forms of

5043

production rather than capitalistic forms.

5044

5045

5 Will privatising "the commons" increase liberty?

5046

5047

"Anarcho"-capitalists aim for a situation in which "no land areas,

5048

no square footage in the world shall remain 'public,'" in other words

5049

*everything* will be "privatised." [Murray Rothbard, _Nations by

5050

Consent_, p. 84] They claim that privatising "the commons" (e.g. roads,

5051

parks, etc.) which are now freely available to all will increase liberty.

5052

Is this true? We have shown before why the claim that privatisation can

5053

protect the environment is highly implausible (see section E.2). Here we

5054

will concern ourselves with private ownership of commonly used "property"

5055

which we all take for granted and pay for with taxes.

5056

5057

Its clear from even a brief consideration of a hypothetical society based

5058

on "privatised" roads (as suggested by Murray Rothbard in _For a New

5059

Liberty_, pp. 202-203 and David Friedman in _The Machinery of Freedom_,

5060

pp. 98-101) that the only increase of liberty will be for the ruling elite.

5061

As "anarcho"-capitalism is based on paying for what one uses, privatisation

5062

of roads would require some method of tracking individuals to ensure that

5063

they pay for the roads they use. In the UK, for example, during the 1980s

5064

the British Tory government looked into the idea of toll-based motorways.

5065

Obviously having toll-booths on motorways would hinder their use and restrict

5066

"freedom," and so they came up with the idea of tracking cars by satellite.

5067

Every vehicle would have a tracking device installed in it and a satellite

5068

would record where people went and which roads they used. They would then

5069

be sent a bill or have their bank balances debited based on this information

5070

(in the fascist city-state/company town of Singapore such a scheme *has*

5071

been introduced).

5072

5073

If we extrapolate from this example to a system of *fully* privatised

5074

"commons," it would clearly require all individuals to have tracking

5075

devices on them so they could be properly billed for use of roads,

5076

pavements, etc. Obviously being tracked by private firms would be a

5077

serious threat to individual liberty. Another, less costly, option would

5078

be for private guards to randomly stop and question car-owners and

5079

individuals to make sure they had paid for the use of the road or pavement

5080

in question. "Parasites" would be arrested and fined or locked up. Again,

5081

however, being stopped and questioned by uniformed individuals has more

5082

in common with police states than liberty. Toll-boothing *every* street

5083

would be highly unfeasible due to the costs involved and difficulties for

5084

use that it implies. Thus the idea of privatising roads and charging

5085

drivers to gain access seems impractical at best and distinctly freedom

5086

endangering if implemented at worse.

5087

5088

Of course, the option of owners letting users have free access to the

5089

roads and pavements they construct and run would be difficult for a

5090

profit-based company. No one could make a profit in that case. If

5091

companies paid to construct roads for their customers/employees to use,

5092

they would be financially hindered in competition with other companies

5093

that did not, and thus would be unlikely to do so. If they restricted

5094

use purely to their own customers, the tracking problem appears again.

5095

5096

Some may object that this picture of extensive surveillance of

5097

individuals would not occur or be impossible. However, Murray

5098

Rothbard (in a slightly different context) argued that technology

5099

would be available to collate information about individuals. He

5100

argued that "[i]t should be pointed out that modern technology

5101

makes even more feasible the collection and dissemination of

5102

information about people's credit ratings and records of keeping or

5103

violating their contracts or arbitration agreements. Presumably, an

5104

anarchist [sic!] society would see the expansion of this sort of

5105

dissemination of data." ["Society Without A State", in _Nomos XIX_,

5106

Pennock and Chapman (eds.), p. 199] So, perhaps, with the total

5107

privatisation of society we would also see the rise of private

5108

Big Brothers, collecting information about individuals for use by

5109

property owners. The example of the _Economic League_ (a British

5110

company who provided the "service" of tracking the political

5111

affiliations and activities of workers for employers) springs

5112

to mind.

5113

5114

And, of course, these privatisation suggestions ignore differences in

5115

income and market power. If, for example, variable pricing is used to

5116

discourage road use at times of peak demand (to eliminate traffic jams

5117

at rush-hour) as is suggested both by Murray Rothbard and David Friedman,

5118

then the rich will have far more "freedom" to travel than the rest of

5119

the population. And we may even see people having to go into debt just

5120

to get to work or move to look for work.

5121

5122

Which raises another problem with notion of total privatisation, the

5123

problem that it implies the end of freedom of travel. Unless you get

5124

permission or (and this seems more likely) pay for access, you will

5125

not be able to travel *anywhere.* As Rothbard *himself* makes clear,

5126

"anarcho"-capitalism means the end of the right to roam or even

5127

travel. He states that "it became clear to me that a totally privatised

5128

country would not have open borders at all. If every piece of land

5129

in a country were owned . . . no immigrant could enter there unless

5130

invited to enter and allowed to rent, or purchase, property." [_Nations

5131

by Consent_, p. 84] What happens to those who cannot *afford* to

5132

pay for access is not addressed (perhaps, being unable to exit a

5133

given capitalist's land they will become bonded labourers? Or be

5134

imprisoned and used to undercut workers' wages via prison labour?

5135

Perhaps they will just be shot as trespassers? Who can tell?). Nor

5136

is it addressed how this situation actually *increases* freedom.

5137

For Rothbard, a "totally privatised country would be as closed as

5138

the particular inhabitants and property owners [*not* the same

5139

thing, we must point out] desire. It seems clear, then, that the

5140

regime of open borders that exists *de facto* in the US really

5141

amounts to a compulsory opening by the central state. . . and does

5142

not genuinely reflect the wishes of the proprietors." [Op. Cit.,

5143

p. 85] Of course, the wishes of *non*-proprietors (the vast

5144

majority) do not matter in the slightest. Thus, it is clear, that

5145

with the privatisation of "the commons" the right to roam, to

5146

travel, would become a privilege, subject to the laws and rules

5147

of the property owners. This can hardly be said to *increase*

5148

freedom for anyone bar the capitalist class.

5149

5150

Rothbard acknowledges that "in a fully privatised world, access

5151

rights would obviously be a crucial part of land ownership."

5152

[_Nations by Consent_, p. 86] Given that there is no free lunch,

5153

we can imagine we would have to pay for such "rights." The implications

5154

of this are obviously unappealing and an obvious danger to individual

5155

freedom. The problem of access associated with the idea of privatising

5156

the roads can only be avoided by having a "right of passage" encoded

5157

into the "general libertarian law code." This would mean that road

5158

owners would be required, by law, to let anyone use them. But where

5159

are "absolute" property rights in this case? Are the owners of roads

5160

not to have the same rights as other owners? And if "right of passage"

5161

is enforced, what would this mean for road owners when people sue

5162

them for car-pollution related illnesses? (The right of those injured

5163

by pollution to sue polluters is the main way "anarcho"-capitalists

5164

propose to protect the environment. See sections E.2 and E.3). It

5165

is unlikely that those wishing to bring suit could find, never mind

5166

sue, the millions of individual car owners who could have potentially

5167

caused their illness. Hence the road-owners would be sued for letting

5168

polluting (or unsafe) cars onto "their" roads. The road-owners would

5169

therefore desire to restrict pollution levels by restricting the

5170

right to use their property, and so would resist the "right of

5171

passage" as an "attack" on their "absolute" property rights. If

5172

the road-owners got their way (which would be highly likely given

5173

the need for "absolute" property rights and is suggested by the variable

5174

pricing way to avoid traffic jams mentioned above) and were able to

5175

control who used their property, freedom to travel would be *very*

5176

restricted and limited to those whom the owner considered "desirable."

5177

Indeed, Murray Rothbard supports such a regime ("In the free [sic!]

5178

society, they [travellers] would, in the first instance, have the

5179

right to travel only on those streets whose owners agree to have

5180

them there" [_The Ethics of Liberty_, p. 119]). The threat to

5181

liberty in such a system is obvious -- to all but Rothbard and

5182

other right-libertarians, of course.

5183

5184

To take another example, let us consider the privatisation of parks,

5185

streets and other public areas. Currently, individuals can use these areas

5186

to hold political demonstrations, hand out leaflets, picket and so on.

5187

However, under "anarcho"-capitalism the owners of such property can

5188

restrict such liberties if they desire, calling such activities "initiation

5189

of force" (although they cannot explain how speaking your mind is an

5190

example of "force"). Therefore, freedom of speech, assembly and a host

5191

of other liberties we take for granted would be reduced (if not eliminated)

5192

under a right-"libertarian" regime. Or, taking the case of pickets and

5193

other forms of social struggle, its clear that privatising "the commons"

5194

would only benefit the bosses. Strikers or other activists picketing or

5195

handing out leaflets in shopping centre's are quickly ejected by private

5196

security even today. Think about how much worse it would become under

5197

"anarcho"-capitalism when the whole world becomes a series of malls -- it

5198

would be impossible to hold a picket when the owner of the pavement objects,

5199

for example (as Rothbard himself argues, Op. Cit., p. 132) and if the owner

5200

of the pavement also happens to be the boss being picketed, then workers'

5201

rights would be zero. Perhaps we could also see capitalists suing working

5202

class organisations for littering their property if they do hand out

5203

leaflets (so placing even greater stress on limited resources).

5204

5205

The I.W.W. went down in history for its rigorous defence of freedom of

5206

speech because of its rightly famous "free speech" fights in numerous

5207

American cities and towns. Repression was inflicted upon wobblies who

5208

joined the struggle by "private citizens," but in the end the I.W.W. won.

5209

Consider the case under "anarcho"-capitalism. The wobblies would have

5210

been "criminal aggressors" as the owners of the streets have refused

5211

to allow "undesirables" to use them to argue their case. If they

5212

refused to acknowledge the decree of the property owners, private

5213

cops would have taken them away. Given that those who controlled

5214

city government in the historical example were the wealthiest citizens

5215

in town, its likely that the same people would have been involved in

5216

the fictional ("anarcho"-capitalist) account. Is it a good thing that

5217

in the real account the wobblies are hailed as heroes of freedom but

5218

in the fictional one they are "criminal aggressors"? Does converting

5219

public spaces into private property *really* stop restrictions on free

5220

speech being a bad thing?

5221

5222

Of course, Rothbard (and other right-libertarians) are aware that

5223

privatisation will not remove restrictions on freedom of speech,

5224

association and so on (while, at the same time, trying to portray

5225

themselves as supporters of such liberties!). However, for

5226

right-libertarians such restrictions are of no consequence. As

5227

Rothbard argues, any "prohibitions would not be state imposed,

5228

but would simply be requirements for residence or for use of

5229

some person's or community's land area." [_Nations by Consent_,

5230

p. 85] Thus we yet again see the blindness of right-libertarians

5231

to the commonality between private property and the state. The

5232

state also maintains that submitting to its authority is the

5233

requirement for taking up residence in its territory (see

5234

also section 2.3 for more on this). As Benjamin Tucker noted,

5235

the state can be defined as (in part) "the assumption of sole

5236

authority over a given area and all within it." [_The Individualist

5237

Anarchists_, p. 24] If the property owners can determine

5238

"prohibitions" (i.e. laws and rules) for those who use the

5239

property then they are the "sole authority over a given area

5240

and all within it," i.e. a state. Thus privatising "the commons"

5241

means subjecting the non-property owners to the rules and laws

5242

of the property owners -- in effect, privatising the state and

5243

turning the world into a series of Monarchies and oligarchies

5244

without the pretence of democracy and democratic rights.

5245

5246

These examples can hardly be said to be increasing liberty for society as

5247

a whole, although "anarcho" capitalists seem to think they would. So far

5248

from *increasing* liberty for all, then, privatising the commons would

5249

only increase it for the ruling elite, by giving them yet another monopoly

5250

from which to collect income and exercise their power over. It would

5251

*reduce* freedom for everyone else. As Peter Marshall notes, "[i]n the name

5252

of freedom, the anarcho-capitalists would like to turn public spaces into

5253

private property, but freedom does not flourish behind high fences protected

5254

by private companies but expands in the open air when it is enjoyed by all."

5255

[_Demanding the Impossible_, p. 564]

5256

5257

Little wonder Proudhon argued that "if the public highway is nothing but

5258

an accessory of private property; if the communal lands are converted into

5259

private property; if the public domain, in short, is guarded, exploited,

5260

leased, and sold like private property -- what remains for the proletaire?

5261

Of what advantage is it to him that society has left the state of war to

5262

enter the regime of police?" [_System of Economic Contradictions_, p. 371]

5263

5264

6 Is "anarcho"-capitalism against the state?

5265

5266

No. Due to its basis in private property, "anarcho"-capitalism implies a

5267

class division of society into bosses and workers. Any such division

5268

will require a state to maintain it. However, it need not be the same

5269

state as exists now. Regarding this point, "anarcho"-capitalism plainly

5270

advocates "defence associations" to protect property. For the

5271

"anarcho"-capitalist, however, these private companies are not

5272

states. For anarchists, they most definitely are.

5273

5274

According to Murray Rothbard ["Society Without A State", in _Nomos XIX_,

5275

Pennock and Chapman, eds., p. 192], a state must have one or both of the

5276

following characteristics:

5277

5278

1) The ability to tax those who live within it.

5279

2) It asserts and usually obtains a coerced monopoly of the

5280

provision of defence over a given area.

5281

5282

He makes the same point in _The Ethics of Liberty_ [p. 171].

5283

5284

Instead of this, the "anarcho"-capitalist thinks that people should be

5285

able to select their own "defence companies" (which would provide the

5286

needed police) and courts from the free market in "defence" which would

5287

spring up after the state monopoly has been eliminated. These companies

5288

"all. . . would have to abide by the basic law code" ["Society Without

5289

A State", p. 206]. Thus a "general libertarian law code" would govern the

5290

actions of these companies. This "law code" would prohibit coercive

5291

aggression at the very least, although to do so it would have to specify

5292

what counted as legitimate property, how said can be owned and what

5293

actually constitutes aggression. Thus the law code would be quite

5294

extensive.

5295

5296

How is this law code to be actually specified? Would these laws be

5297

democratically decided? Would they reflect common usage (i.e. custom)?

5298

"supply and demand"? "Natural law"? Given the strong dislike of

5299

democracy shown by "anarcho"-capitalists, we think we can safely say

5300

that some combination of the last two options would be used. Murray

5301

Rothbard, as noted in section 1.4, opposed the individualist anarchist

5302

principle that juries would judge both the facts and the law, suggesting

5303

instead that "Libertarian lawyers and jurists" would determine a "rational

5304

and objective code of libertarian legal principles and procedures." The

5305

judges in his system would "not [be] making the law but finding it on the

5306

basis of agreed-upon principles derived either from custom or reason."

5307

["Society without a State", Op. Cit., p. 206] David Friedman, on the other

5308

hand, argues that different defence firms would sell their own laws.

5309

[_The Machinery of Freedom_, p. 116] It is sometimes acknowledged

5310

that non-libertarian laws may be demanded (and supplied) in such a

5311

market.

5312

5313

Around this system of "defence companies" is a free market in "arbitrators"

5314

and "appeal judges" to administer justice and the "basic law code." Rothbard

5315

believes that such a system would see "arbitrators with the best reputation

5316

for efficiency and probity . . . [being] chosen by the various parties in the

5317

market . . . [and] will come to be given an increasing amount of business."

5318

Judges "will prosper on the market in proportion to their reputation for

5319

efficiency and impartiality." [Op. Cit., p. 199 and p. 204] Therefore,

5320

like any other company, arbitrators would strive for profits and wealth,

5321

with the most successful ones becoming "prosperous." Of course, such

5322

wealth would have no impact on the decisions of the judges, and if it did,

5323

the population (in theory) are free to select any other judge (although, of

5324

course, they would also "strive for profits and wealth" -- which means the

5325

choice of character may be somewhat limited! -- and the laws which they

5326

were using to guide their judgements would be enforcing capitalist rights).

5327

5328

Whether or not this system would work as desired is discussed in the

5329

following sections. We think that it will not. Moreover, we will argue that

5330

"anarcho"-capitalist "defence companies" meet not only the criteria of

5331

statehood we outlined in section B.2, but also Rothbard's own criteria

5332

for the state, quoted above.

5333

5334

As regards the anarchist criterion, it is clear that "defence companies"

5335

exist to defend private property; that they are hierarchical (in that

5336

they are capitalist companies which defend the power of those who employ

5337

them); that they are professional coercive bodies; and that they exercise

5338

a monopoly of force over a given area (the area, initially, being the

5339

property of the person or company who is employing the "association").

5340

If, as Ayn Rand noted (using a Weberian definition of the state) a government

5341

is an institution "that holds the exclusive power to *enforce* certain rules

5342

of conduct in a given geographical area" [_Capitalism: The Unknown Ideal_,

5343

p. 239] then these "defence companies" are the means by which the property

5344

owner (who exercises a monopoly to determine the rules governing their

5345

property) enforce their rules.

5346

5347

For this (and other reasons), we should call the "anarcho"-capitalist

5348

defence firms "private states" -- that is what they are -- and

5349

"anarcho"-capitalism "private state" capitalism.

5350

5351

Before discussing these points further, it is necessary to point out a

5352

relatively common fallacy of "anarcho"-capitalists. This is the idea that

5353

"defence" under the system they advocate means defending people, not

5354

territorial areas. This, for some, means that defence companies are not

5355

"states." However, as people and their property and possessions do not

5356

exist merely in thought but on the Earth, it is obvious that these

5357

companies will be administering "justice" over a given area of the

5358

planet. It is also obvious, therefore, that these "defence associations"

5359

will operate over a (property-owner defined) area of land and enforce

5360

the property-owner's laws, rules and regulations. The deeply

5361

anti-libertarian, indeed fascistic, aspects of this "arrangement"

5362

will be examined in the following sections.

5363

5364

6.1 What's wrong with this "free market" justice?

5365

5366

It does not take much imagination to figure out whose interests "prosperous"

5367

arbitrators, judges and defence companies would defend: their own, as well

5368

as those who pay their wages -- which is to say, other members of the rich

5369

elite. As the law exists to defend property, then it (by definition) exists

5370

to defend the power of capitalists against their workers.

5371

5372

Rothbard argues that the "judges" would "not [be] making the law but

5373

finding it on the basis of agreed-upon principles derived either from

5374

custom or reason" [Rothbard, Op. Cit., p. 206]. However, this begs the

5375

question: *whose* reason? *whose* customs? Do individuals in different

5376

classes share the same customs? The same ideas of right and wrong? Would

5377

rich and poor desire the same from a "basic law code"? Obviously not. The

5378

rich would only support a code which defended their power over the poor.

5379

5380

Although only "finding" the law, the arbitrators and judges still exert

5381

an influence in the "justice" process, an influence not impartial or

5382

neutral. As the arbitrators themselves would be part of a profession, with

5383

specific companies developing within the market, it does not take a

5384

genius to realise that when "interpreting" the "basic law code," such

5385

companies would hardly act against their own interests as companies. In

5386

addition, if the "justice" system was based on "one dollar, one vote," the

5387

"law" would best defend those with the most "votes" (the question of

5388

market forces will be discussed in section 6.3). Moreover, even if

5389

"market forces" would ensure that "impartial" judges were dominant, all

5390

judges would be enforcing a *very* partial law code (namely one that

5391

defended *capitalist* property rights). Impartiality when enforcing

5392

partial laws hardly makes judgements less unfair.

5393

5394

Thus, due to these three pressures -- the interests of arbitrators/judges,

5395

the influence of money and the nature of the law -- the terms of "free

5396

agreements" under such a law system would be tilted in favour of lenders

5397

over debtors, landlords over tenants, employers over employees, and in

5398

general, the rich over the poor, just as we have today. This is what one

5399

would expect in a system based on "unrestricted" property rights and a

5400

(capitalist) free market. A similar tendency towards the standardisation

5401

of output in an industry in response to influences of wealth can be seen

5402

from the current media system (see section D.3 -- How does wealth

5403

influence the mass media?)

5404

5405

Some "anarcho"-capitalists, however, claim that just as cheaper cars were

5406

developed to meet demand, so cheaper defence associations and "people's

5407

arbitrators" would develop on the market for the working class. In this

5408

way impartiality will be ensured. This argument overlooks a few key points:

5409

5410

Firstly, the general "libertarian" law code would be applicable to *all*

5411

associations, so they would have to operate within a system determined

5412

by the power of money and of capital. The law code would reflect,

5413

therefore, property *not* labour and so "socialistic" law codes would

5414

be classed as "outlaw" ones. The options then facing working people

5415

is to select a firm which best enforced the *capitalist* law in their

5416

favour. And as noted above, the impartial enforcement of a biased law

5417

code will hardly ensure freedom or justice for all.

5418

5419

Secondly, in a race between a Jaguar and a Volkswagen Beetle, who is more

5420

likely to win? The rich would have "the best justice money can buy," as

5421

they do now. Members of the capitalist class would be able to select the

5422

firms with the best lawyers, best private cops and most resources. Those

5423

without the financial clout to purchase quality "justice" would simply be

5424

out of luck - such is the "magic" of the marketplace.

5425

5426

Thirdly, because of the tendency toward concentration, centralisation,

5427

and oligopoly under capitalism (due to increasing capital costs for new

5428

firms entering the market, as discussed in section C.4), a few companies

5429

would soon dominate the market -- with obvious implications for "justice."

5430

Different firms will have different resources. In other words, in a

5431

conflict between a small firm and a larger one, the smaller one is at a

5432

disadvantage in terms of resources. They may not be in a position to fight

5433

the larger company if it rejects arbitration and so may give in simply

5434

because, as the "anarcho"-capitalists so rightly point out, conflict and

5435

violence will push up a company's costs and so they would have to be avoided

5436

by smaller companies. It is ironic that the "anarcho"-capitalist implicitly

5437

assumes that every "defence company" is approximately of the same size, with

5438

the same resources behind it. In real life, this would clearly *not* the case.

5439

5440

Fourthly, it is *very* likely that many companies would make subscription to

5441

a specific "defence" firm or court a requirement of employment. Just as today

5442

many (most?) workers have to sign no-union contracts (and face being fired

5443

if they change their minds), it does not take much imagination to see that

5444

the same could apply to "defence" firms and courts. This was/is the case

5445

in company towns (indeed, you can consider unions as a form of "defence"

5446

firm and these companies refused to recognise them). As the labour market

5447

is almost always a buyer's market, it is not enough to argue that workers

5448

can find a new job without this condition. They may not and so have to put

5449

up with this situation. And if (as seems likely) the laws and rules of the

5450

property-owner will take precedence in any conflict, then workers and tenants

5451

will be at a disadvantage no matter how "impartial" the judges.

5452

5453

Ironically, some "anarcho"-capitalists point to current day company/union

5454

negotiations as an example of how different defence firms would work

5455

out their differences peacefully. Sadly for this argument, union rights

5456

under "actually existing capitalism" were created and enforced by the

5457

state in direct opposition to capitalist "freedom of contract." Before

5458

the law was changed, unions were often crushed by force -- the companies

5459

were better armed, had more resources and had the law on their side.

5460

Today, with the "downsizing" of companies we can see what happens to

5461

"peaceful negotiation" and "co-operation" between unions and companies

5462

when it is no longer required (i.e. when the resources of both sides

5463

are unequal). The market power of companies far exceeds those of the

5464

unions and the law, by definition, favours the companies. As an example

5465

of how competing "protection agencies" will work in an "anarcho"-capitalist

5466

society, it is far more insightful than originally intended!

5467

5468

Now let us consider the "basic law code" itself. How the laws in the

5469

"general libertarian law code" would actually be selected is anyone's

5470

guess, although many "anarcho"-capitalists support the myth of "natural

5471

law," and this would suggest an unchangeable law code selected by those

5472

considered as "the voice of nature" (see section 11. for a discussion of

5473

its authoritarian implications). David Friedman argues that as well as a

5474

market in defence companies, there will also be a market in laws and rights.

5475

However, there will be extensive market pressure to unify these differing

5476

law codes into one standard one (imagine what would happen if ever CD

5477

manufacturer created a unique CD player, or every computer manufacturer

5478

different sized floppy-disk drivers -- little wonder, then, that over

5479

time companies standardise their products). Friedman himself acknowledges

5480

that this process is likely (and uses the example of standard paper sizes

5481

to indicate such a process).

5482

5483

In any event, the laws would not be decided on the basis of "one person, one

5484

vote"; hence, as market forces worked their magic, the "general" law code

5485

would reflect vested interests and so be very hard to change. As rights and

5486

laws would be a commodity like everything else in capitalism, they would soon

5487

reflect the interests of the rich -- particularly if those interpreting the

5488

law are wealthy professionals and companies with vested interests of their

5489

own. Little wonder that the individualist anarchists proposed "trial by jury"

5490

as the only basis for real justice in a free society. For, unlike professional

5491

"arbitrators," juries are ad hoc, made up of ordinary people and do not

5492

reflect power, authority, or the influence of wealth. And by being able

5493

to judge the law as well as a conflict, they can ensure a populist revision

5494

of laws as society progresses.

5495

5496

Thus a system of "defence" on the market will continue to reflect the

5497

influence and power of property owners and wealth and not be subject to

5498

popular control beyond choosing between companies to enforce the capitalist

5499

laws.

5500

5501

6.2 What are the social consequences of such a system?

5502

5503

The "anarcho" capitalist imagines that there will be police agencies,

5504

"defence associations," courts, and appeals courts all organised on a

5505

free-market basis and available for hire. As David Weick points out,

5506

however, the major problem with such a system would not be the corruption

5507

of "private" courts and police forces (although, as suggested above, this

5508

could indeed be a problem):

5509

5510

"There is something more serious than the 'Mafia danger', and this other

5511

problem concerns the role of such 'defence' institutions in a given social

5512

and economic context.

5513

5514

"[The] context. . . is one of a free-market economy with no restraints

5515

upon accumulation of property. Now, we had an American experience,

5516

roughly from the end of the Civil War to the 1930's, in what were in

5517

effect private courts, private police, indeed private governments. We

5518

had the experience of the (private) Pinkerton police which, by its spies,

5519

by its *agents provocateurs,* and by methods that included violence and

5520

kidnapping, was one of the most powerful tools of large corporations

5521

and an instrument of oppression of working people. We had the experience

5522

as well of the police forces established to the same end, within

5523

corporations, by numerous companies. . . . (The automobile companies

5524

drew upon additional covert instruments of a private nature, usually

5525

termed vigilante, such as the Black Legion). These were, in effect,

5526

private armies, and were sometimes described as such. The territories

5527

owned by coal companies, which frequently included entire towns and their

5528

environs, the stores the miners were obliged by economic coercion to

5529

patronise, the houses they lived in, were commonly policed by the private

5530

police of the United States Steel Corporation or whatever company owned

5531

the properties. The chief practical function of these police was, of

5532

course, to prevent labour organisation and preserve a certain balance of

5533

'bargaining.'

5534

5535

"These complexes were a law unto themselves, powerful enough to ignore,

5536

when they did not purchase, the governments of various jurisdictions of

5537

the American federal system. This industrial system was, at the time,

5538

often characterised as feudalism. . . ." ["Anarchist Justice", Op. Cit.,

5539

pp. 223-224]

5540

5541

For a description of the weaponry and activities of these private armies,

5542

the economic historian Maurice Dobbs presents an excellent summary in

5543

_Studies in Capitalist Development_ [pp. 353-357]. According to a report on

5544

"Private Police Systems" cited by Dobbs, in a town dominated by Republican

5545

Steel, the "civil liberties and the rights of labour were suppressed by

5546

company police. Union organisers were driven out of town." Company towns

5547

had their own (company-run) money, stores, houses and jails and many

5548

corporations had machine-guns and tear-gas along with the usual shot-guns,

5549

rifles and revolvers. The "usurpation of police powers by privately paid

5550

'guards and 'deputies', often hired from detective agencies, many with

5551

criminal records" was "a general practice in many parts of the country."

5552

5553

The local (state-run) law enforcement agencies turned a blind-eye to what

5554

was going on (after all, the workers *had* broken their contracts and

5555

so were "criminal aggressors" against the companies) even when union

5556

members and strikers were beaten and killed. The workers own defence

5557

organisations were the only ones willing to help them, and if the workers

5558

seemed to be winning then troops were called in to "restore the peace"

5559

(as happened in the Ludlow strike, when strikers originally cheered

5560

the troops as they thought they would defend their civil rights; needless

5561

to say, they were wrong).

5562

5563

Here we have a society which is claimed by many "anarcho"-capitalists

5564

as one of the closest examples to their "ideal," with limited state

5565

intervention, free reign for property owners, etc. What happened? The

5566

rich reduced the working class to a serf-like existence, capitalist

5567

production undermined independent producers (much to the annoyance of

5568

individualist anarchists at the time), and the result was the emergence

5569

of the corporate America that "anarcho"-capitalists say they oppose.

5570

5571

Are we to expect that "anarcho"-capitalism will be different? That, unlike

5572

before, "defence" firms will intervene on behalf of strikers? Given that

5573

the "general libertarian law code" will be enforcing capitalist property

5574

rights, workers will be in exactly the same situation as they were then.

5575

Support of strikers violating property rights would be a violation of

5576

the "general libertarian law code" and be costly for profit making firms

5577

to do (if not dangerous as they could be "outlawed" by the rest). Thus

5578

"anarcho"-capitalism will extend extensive rights and powers to bosses,

5579

but few if any rights to rebellious workers. And this difference in power

5580

is enshrined within the fundamental institutions of the system.

5581

5582

In evaluating "anarcho"-capitalism's claim to be a form of anarchism,

5583

Peter Marshall notes that "private protection agencies would merely serve

5584

the interests of their paymasters." [_Demanding the Impossible_, p. 653]

5585

With the increase of private "defence associations" under "really existing

5586

capitalism" today (associations that many "anarcho"-capitalists point to

5587

as examples of their ideas), we see a vindication of Marshall's claim.

5588

There have been many documented experiences of protesters being badly

5589

beaten by private security guards. As far as market theory goes, the

5590

companies are only supplying what the buyer is demanding. The rights of

5591

others are *not a factor* (yet more "externalities," obviously). Even

5592

if the victims successfully sue the company, the message is clear --

5593

social activism can seriously damage your health. With a reversion

5594

to "a general libertarian law code" enforced by private companies,

5595

this form of "defence" of "absolute" property rights can only increase,

5596

perhaps to the levels previously attained in the heyday of US capitalism,

5597

as described above by Weick.

5598

5599

6.3 But surely market forces will stop abuses by the rich?

5600

5601

Unlikely. The rise of corporations within America indicates exactly how a

5602

"general libertarian law code" would reflect the interests of the rich and

5603

powerful. The laws recognising corporations as "legal persons" were *not*

5604

primarily a product of "the state" but of private lawyers hired by the

5605

rich -- a result with which Rothbard would have no problem. As Howard

5606

Zinn notes:

5607

5608

"the American Bar Association, organised by lawyers accustomed to

5609

serving the wealthy, began a national campaign of education to reverse

5610

the [Supreme] Court decision [that companies could not be considered as

5611

a person]. . . . By 1886. . . the Supreme Court had accepted the argument

5612

that corporations were 'persons' and their money was property protected by

5613

the process clause of the Fourteenth Amendment. . . . The justices of the

5614

Supreme Court were not simply interpreters of the Constitution. They were

5615

men of certain backgrounds, of certain [class] interests." [_A People's

5616

History of the United States_, p. 255]

5617

5618

Of course it will be argued that the Supreme Court is a monopoly and so

5619

our analysis is flawed. In "anarcho"-capitalism there is no monopoly.

5620

But the corporate laws came about because there was a demand for them.

5621

That demand would still have existed in "anarcho"-capitalism. Now, while

5622

there may be no Supreme Court, Rothbard does maintain that "the basic

5623

Law Code . . .would have to be agreed upon by all the judicial agencies"

5624

but he maintains that this "would imply no unified legal system"! Even

5625

though "[a]ny agencies that transgressed the basic libertarian law

5626

code would be open outlaws" and soon crushed this is *not*, apparently,

5627

a monopoly. [_The Ethics of Liberty_, p. 234] So, you either agree to

5628

the law code or you go out of business. And that is *not* a monopoly!

5629

Therefore, we think, our comments on the Supreme Court decision are

5630

valid.

5631

5632

If all the available defence firms enforce the same laws, then it can

5633

hardly be called "competitive"! And if this is the case (and it is)

5634

"when private wealth is uncontrolled, then a police-judicial complex

5635

enjoying a clientele of wealthy corporations whose motto is self-interest

5636

is hardly an innocuous social force controllable by the possibility of

5637

forming or affiliating with competing 'companies.'" [Weick, Op. Cit.,

5638

p. 225]

5639

5640

This is particularly true if these companies are themselves Big Business

5641

and so have a large impact on the laws they are enforcing. If the law

5642

code recognises and protects capitalist power, property and wealth as

5643

fundamental *any* attempt to change this is "initiation of force" and

5644

so the power of the rich is written into the system from the start!

5645

5646

(And, we must add, if there is a general libertarian law code to which

5647

all must subscribe, where does that put customer demand? If people demand

5648

a non-libertarian law code, will defence firms refuse to supply it? If so,

5649

will not new firms, looking for profit, spring up that will supply what

5650

is being demanded? And will that not put them in direct conflict with the

5651

existing, pro-general law code ones? And will a market in law codes not

5652

just reflect economic power and wealth? David Friedman, who is for a market

5653

in law codes, argues that "[i]f almost everyone believes strongly that

5654

heroin addiction is so horrible that it should not be permitted anywhere

5655

under any circumstances anarcho-capitalist institutions will produce laws

5656

against heroin. Laws are being produced on the market, and that is what the

5657

market wants." And he adds that "market demands are in dollars, not votes.

5658

The legality of heroin will be determined, not by how many are for or against

5659

but how high a cost each side is willing to bear in order to get its way."

5660

[_The Machinery of Freedom_, p. 127] And, as the market is less than equal

5661

in terms of income and wealth, such a position will mean that the capitalist

5662

class will have a higher effective demand than the working class, and more

5663

resources to pay for any conflicts that arise. Thus any law codes that

5664

develop will tend to reflect the interests of the wealthy.)

5665

5666

Which brings us nicely on to the next problem regarding market forces.

5667

5668

As well as the obvious influence of economic interests and differences

5669

in wealth, another problem faces the "free market" justice of

5670

"anarcho"-capitalism. This is the "general libertarian law code" itself.

5671

Even if we assume that the system actually works like it should in theory,

5672

the simple fact remains that these "defence companies" are enforcing laws

5673

which explicitly defend capitalist property (and so social relations).

5674

Capitalists own the means of production upon which they hire wage-labourers

5675

to work and this is an inequality established *prior* to any specific

5676

transaction in the labour market. This inequality reflects itself in

5677

terms of differences in power within (and outside) the company and

5678

in the "law code" of "anarcho"-capitalism which protects that power

5679

against the dispossessed.

5680

5681

In other words, the law code within which the defence companies work

5682

assumes that capitalist property is legitimate and that force can

5683

legitimately be used to defend it. This means that, in effect,

5684

"anarcho"-capitalism is based on a monopoly of law, a monopoly which

5685

explicitly exists to defend the power and capital of the wealthy.

5686

The major difference is that the agencies used to protect that

5687

wealth will be in a weaker position to act independently of their

5688

pay-masters. Unlike the state, the "defence" firm is not remotely

5689

accountable to the general population and cannot be used to equalise

5690

even slightly the power relationships between worker and capitalist.

5691

5692

And, needless to say, it is very likely that the private police forces

5693

*will* give preferential treatment to their wealthier customers (what

5694

business does not?) and that the law code will reflect the interests of the

5695

wealthier sectors of society (particularly if "prosperous" judges administer

5696

that code) in reality, even if not in theory. Since, in capitalist practice,

5697

"the customer is always right," the best-paying customers will get their

5698

way in "anarcho"-capitalist society.

5699

5700

For example, in chapter 29 of _The Machinery of Freedom_, David Friedman

5701

presents an example of how a clash of different law codes could be resolved

5702

by a bargaining process (the law in question is the death penalty). This

5703

process would involve one defence firm giving a sum of money to the other

5704

for them accepting the appropriate (anti/pro capital punishment) court.

5705

Friedman claims that "[a]s in any good trade, everyone gains" but this

5706

is obviously not true. Assuming the anti-capital punishment defence firm

5707

pays the pro one to accept an anti-capital punishment court, then, yes,

5708

both defence firms have made money and so are happy, so are the anti-capital

5709

punishment consumers but the pro-death penalty customers have only (perhaps)

5710

received a cut in their bills. Their desire to see criminals hanged (for

5711

whatever reason) has been ignored (if they were not in favour of the

5712

death penalty, they would not have subscribed to that company). Friedman

5713

claims that the deal, by allowing the anti-death penalty firm to cut its

5714

costs, will ensure that it "keep its customers and even get more" but

5715

this is just an assumption. It is just as likely to loose customers to a

5716

defence firm that refuses to compromise (and has the resources to back it

5717

up). Friedman's assumption that lower costs will automatically win over

5718

people's passions is unfounded. As is the assumption that both firms have

5719

equal resources and bargaining power. If the pro-capital punishment firm

5720

demands more than the anti can provide and has larger weaponry and troops,

5721

then the anti defence firm may have to agree to let the pro one have its

5722

way.

5723

5724

So, all in all, it is *not* clear that "everyone gains" -- there may be a

5725

sizeable percentage of those involved who do not "gain" as their desire for

5726

capital punishment is traded away by those who claimed they would enforce

5727

it.

5728

5729

In other words, a system of competing law codes and privatised rights

5730

does not ensure that *all* consumers interests are meet. Given unequal

5731

resources within society, it is also clear that the "effective demand"

5732

of the parties involved to see their law codes enforced is drastically

5733

different. The wealthy head of a transnational corporation will have far

5734

more resources available to him to pay for *his* laws to be enforced than

5735

one of his employees on the assembly line. Moreover, as we argue in sections

5736

3.1 and 10.2, the labour market is usually skewed in favour of capitalists.

5737

This means that workers have to compromise to get work and such compromises

5738

may involve agreeing to join a specific "defence" firm or not join one

5739

at all (just as workers are often forced to sign non-union contracts

5740

today in order to get work). In other words, a privatised law system

5741

is very likely to skew the enforcement of laws in line with the skewing

5742

of income and wealth in society. At the very least, unlike every other

5743

market, the customer is *not* guaranteed to get exactly what they demand

5744

simply because the product they "consume" is dependent on other within

5745

the same market to ensure its supply. The unique workings of the

5746

law/defence market are such as to deny customer choice (we will

5747

discuss other aspects of this unique market shortly).

5748

5749

Weick sums up by saying "any judicial system is going to exist in the

5750

context of economic institutions. If there are gross inequalities of

5751

power in the economic and social domains, one has to imagine society as

5752

strangely compartmentalised in order to believe that those inequalities

5753

will fail to reflect themselves in the judicial and legal domain, and that

5754

the economically powerful will be unable to manipulate the legal and

5755

judicial system to their advantage. To abstract from such influences of

5756

context, and then consider the merits of an abstract judicial system. . .

5757

is to follow a method that is not likely to take us far. This, by the

5758

way, is a criticism that applies. . .to any theory that relies on a rule

5759

of law to override the tendencies inherent in a given social and economic

5760

system" [Weick, Op. Cit., p. 225] (For a discussion of this problem

5761

as it would surface in attempts to protect the environment under

5762

"anarcho"-capitalism, see sections E.2 and E.3.)

5763

5764

There is another reason why "market forces" will not stop abuse by the rich,

5765

or indeed stop the system from turning from private to public statism. This

5766

is due to the nature of the "defence" market (for a similar analysis of

5767

the "defence" market see Tyler Cowen's "Law as a Public Good: The Economics

5768

of Anarchy" in _Economics and Philosophy_, no. 8 (1992), pp. 249-267 and

5769

"Rejoinder to David Friedman on the Economics of Anarchy" in _Economics

5770

and Philosophy_, no. 10 (1994), pp. 329-332). In "anarcho"-capitalist theory

5771

it is assumed that the competing "defence companies" have a vested interest

5772

in peacefully settling differences between themselves by means of arbitration.

5773

In order to be competitive on the market, companies will have to co-operate

5774

via contractual relations otherwise the higher price associated with conflict

5775

will make the company uncompetitive and it will go under. Those companies

5776

that ignore decisions made in arbitration would be outlawed by others,

5777

ostracised and their rulings ignored. By this process, it is argued, a

5778

system of competing "defence" companies will be stable and not turn into

5779

a civil war between agencies with each enforcing the interests of their

5780

clients against others by force.

5781

5782

However, there is a catch. Unlike every other market, the businesses in competition in the "defence" industry *must* co-operate with its fellows

5783

in order to provide its services for its customers. They need to be able

5784

to agree to courts and judges, agree to abide by decisions and law codes

5785

and so forth. In economics there are other, more accurate, terms to

5786

describe co-operative activity between companies: collusion and cartels.

5787

Collusion and cartels is where companies in a specific market agree to

5788

work together to restrict competition and reap the benefits of monopoly

5789

power by working to achieve the same ends in partnership with each other.

5790

In other words this means that collusion is built into the system, with

5791

the necessary contractual relations between agencies in the "protection"

5792

market requiring that firms co-operate and, by so doing, to behave

5793

(effectively) as one large firm (and so, effectively, resemble the

5794

state even more than they already do). Quoting Adam Smith seems appropriate

5795

here: "People of the same trade seldom meet together, even for merriment

5796

and diversion, but the conversation ends in a conspiracy against the

5797

public, or in some contrivance to raise prices." [_The Wealth of

5798

Nations_, p. 117]

5799

5800

For example, when buying food it does not matter whether the supermarkets

5801

I visit have good relations with each other. The goods I buy are independent

5802

of the relationships that exist between competing companies. However, in the

5803

case of private states, this is *not* the case. If a specific "defence"

5804

company has bad relationships with other companies in the market then

5805

it is against my self-interest to subscribe to it. Why join a private state

5806

if its judgements are ignored by the others and it has to resort to violence

5807

to be heard? This, as well as being potentially dangerous, will also push up

5808

the prices I have to pay. Arbitration is one of the most important services

5809

a defence firm can offer its customers and its market share is based upon

5810

being able to settle interagency disputes without risk of war or uncertainty

5811

that the final outcome will not be accepted by all parties.

5812

5813

Therefore, the market set-up within the "anarcho"-capitalist "defence" market

5814

is such that private states *have to co-operate* with the others (or go out

5815

of business fast) and this means collusion can take place. In other words,

5816

a system of private states will have to agree to work together in order to

5817

provide the service of "law enforcement" to their customers and the result

5818

of such co-operation is to create a cartel. However, unlike cartels in other

5819

industries, the "defence" cartel will be a stable body simply because its

5820

members *have* to work with their competitors in order to survive.

5821

5822

Let us look at what would happen after such a cartel is formed in a specific

5823

area and a new "defence company" desired to enter the market. This new

5824

company will have to work with the members of the cartel in order to provide

5825

its services to its customers (note that "anarcho"-capitalists already

5826

assume that they "will have to" subscribe to the same law code). If the

5827

new defence firm tries to under-cut the cartel's monopoly prices, the other

5828

companies would refuse to work with it. Having to face constant conflict or

5829

the possibility of conflict, seeing its decisions being ignored by other

5830

agencies and being uncertain what the results of a dispute would be, few

5831

would patronise the new "defence company." The new company's prices would

5832

go up and so face either folding or joining the cartel. Unlike every other

5833

market, if a "defence company" does not have friendly, co-operative relations

5834

with other firms in the same industry then it will go out of business.

5835

5836

This means that the firms that are co-operating have but to agree not to

5837

deal with new firms which are attempting to undermine the cartel in order

5838

for them to fail. A "cartel busting" firm goes out of business in the same

5839

way an outlaw one does - the higher costs associated with having to solve

5840

all its conflicts by force, not arbitration, increases its production

5841

costs much higher than the competitors and the firm faces insurmountable

5842

difficulties selling its products at a profit (ignoring any drop of

5843

demand due to fears of conflict by actual and potential customers).

5844

Even if we assume that many people will happily join the new firm in spite

5845

of the dangers to protect themselves against the cartel and its taxation

5846

(i.e. monopoly profits), enough will remain members of the cartel (perhaps

5847

they will be fired if they change, perhaps they dislike change and think

5848

the extra money is worth peace, perhaps they fear that by joining the

5849

new company their peace will be disrupted or the outcomes of their problems

5850

with others too unsure to be worth it, perhaps they are shareholders and

5851

want to maintain their income) so that co-operation will still be needed

5852

and conflict unprofitable and dangerous (and as the cartel will have more

5853

resources than the new firm, it could usually hold out longer than the new

5854

firm could). In effect, breaking the cartel may take the form of an

5855

armed revolution -- as it would with any state.

5856

5857

The forces that break up cartels and monopolies in other industries (such as

5858

free entry -- although, of course the "defence" market will be subject to

5859

oligopolistic tendencies as any other and this will create barriers to entry,

5860

see section C.4) do not work here and so new firms have to co-operate or loose

5861

market share and/or profits. This means that "defence companies" will reap

5862

monopoly profits and, more importantly, have a monopoly of force over a given

5863

area.

5864

5865

Hence a monopoly of private states will develop in addition to the existing

5866

monopoly of law and this is a de facto monopoly of force over a given

5867

area (i.e. some kind of public state run by share holders). New companies

5868

attempting to enter the "defence" industry will have to work with the

5869

existing cartel in order to provide the services it offers to its customers.

5870

The cartel is in a dominant position and new entries into the market either

5871

become part of it or fail. This is exactly the position with the state,

5872

with "private agencies" free to operate as long as they work to the state's

5873

guidelines. As with the monopolist "general libertarian law code", if

5874

you do not toe the line, you go out of business fast.

5875

5876

It is also likely that a multitude of cartels would develop, with a given

5877

cartel operating in a given locality. This is because law enforcement

5878

would be localised in given areas as most crime occurs where the criminal

5879

lives. Few criminals would live in New York and commit crimes in Portland.

5880

However, as defence companies have to co-operate to provide their services,

5881

so would the cartels. Few people live all their lives in one area and so

5882

firms from different cartels would come into contact, so forming a

5883

cartel of cartels.

5884

5885

A cartel of cartels may (perhaps) be less powerful than a local cartel, but

5886

it would still be required and for exactly the same reasons a local one

5887

is. Therefore "anarcho"-capitalism would, like "actually existing capitalism,"

5888

be marked by a series of public states covering given areas, co-ordinated by

5889

larger states at higher levels. Such a set up would parallel the United States

5890

in many ways except it would be run directly by wealthy shareholders without

5891

the sham of "democratic" elections. Moreover, as in the USA and other states

5892

there will still be a monopoly of rules and laws (the "general libertarian

5893

law code").

5894

5895

Some "anarcho"-capitalists claim that this will not occur, but that the

5896

co-operation needed to provide the service of law enforcement will somehow

5897

*not* turn into collusion between companies. However, they are quick to

5898

argue that renegade "agencies" (for example, the so-called "Mafia

5899

problem" or those who reject judgements) will go out of business because

5900

of the higher costs associated with conflict and not arbitration. However,

5901

these higher costs are ensured because the firms in question do not

5902

co-operate with others. If other agencies boycott a firm but co-operate with

5903

all the others, then the boycotted firm will be at the same disadvantage

5904

5905

The "anarcho"-capitalist is trying to have it both ways. If the punishment

5906

of non-conforming firms cannot occur, then "anarcho"-capitalism will turn

5907

into a war of all against all or, at the very least, the service of social

5908

peace and law enforcement cannot be provided. If firms cannot deter others

5909

from disrupting the social peace (one service the firm provides) then

5910

"anarcho"-capitalism is not stable and will not remain orderly as agencies

5911

develop which favour the interests of their own customers and enforce their

5912

own law codes at the expense of others. If collusion cannot occur (or is

5913

too costly) then neither can the punishment of non-conforming firms and

5914

"anarcho"-capitalism will prove to be unstable.

5915

5916

So, to sum up, the "defence" market of private states has powerful forces

5917

within it to turn it into a monopoly of force over a given area. From a

5918

privately chosen monopoly of force over a specific (privately owned) area,

5919

the market of private states will turn into a monopoly of force over a

5920

general area. This is due to the need for peaceful relations between

5921

companies, relations which are required for a firm to secure market

5922

share. The unique market forces that exist within this market ensure

5923

collusion and monopoly.

5924

5925

In other words, the system of private states will become a cartel and so a

5926

public state - unaccountable to all but its shareholders, a state of the

5927

wealthy, by the wealthy, for the wealthy. In other words, fascism.

5928

5929

6.4 Why are these "defence associations" states?

5930

5931

It is clear that "anarcho"-capitalist defence associations meet the

5932

criteria of statehood outlined in section B.2 ("Why are anarchists

5933

against the state"). They defend property and preserve authority

5934

relationships, they practice coercion, and are hierarchical

5935

institutions which govern those under them on behalf of a

5936

"ruling elite," i.e. those who employ both the governing forces

5937

and those they govern. Thus, from an anarchist perspective, these

5938

"defence associations" as most definitely states.

5939

5940

What is interesting, however, is that by their own definitions a very

5941

good case can be made that these "defence associations" as states

5942

in the "anarcho"-capitalist sense too. Capitalist apologists usually

5943

define a "government" (or state) as those who have a monopoly of force

5944

and coercion within a given area. Relative to the rest of the society,

5945

these defence associations would have a monopoly of force and coercion

5946

of a given piece of property; thus, by the "anarcho"-capitalists'

5947

*own definition* of statehood, these associations would qualify!

5948

5949

If we look at Rothbard's definition of statehood, which requires (a) the

5950

power to tax and/or (b) a "coerced monopoly of the provision of defence

5951

over a given area", "anarcho"-capitalism runs into trouble.

5952

5953

In the first place, the costs of hiring defence associations will be

5954

deducted from the wealth created by those who use, but do not own, the

5955

property of capitalists and landlords. Let not forget that a capitalist

5956

will only employ a worker or rent out land and housing if they make a

5957

profit from so doing. Without the labour of the worker, there would be

5958

nothing to sell and no wages to pay for rent. Thus a company's or

5959

landlord's "defence" firm will be paid from the revenue gathered from

5960

the capitalists power to extract a tribute from those who use, but do

5961

not own, a property. In other words, workers would pay for the agencies

5962

that enforce their employers' authority over them via the wage system

5963

and rent -- taxation in a more insidious form.

5964

5965

In the second, under capitalism most people spend a large part of their

5966

day on other people's property -- that is, they work for capitalists

5967

and/or live in rented accommodation. Hence if property owners select a

5968

"defence association" to protect their factories, farms, rental housing,

5969

etc., their employees and tenants will view it as a "coerced monopoly of

5970

the provision of defence over a given area." For certainly the employees

5971

and tenants will not be able to hire their own defence companies to

5972

expropriate the capitalists and landlords. So, from the standpoint of

5973

the employees and tenants, the owners do have a monopoly of "defence"

5974

over the areas in question. Of course, the "anarcho"-capitalist will

5975

argue that the tenants and workers "consent" to *all* the rules and

5976

conditions of a contract when they sign it and so the property owner's

5977

monopoly is not "coerced." However, the "consent" argument is so weak

5978

in conditions of inequality as to be useless (see sections 2.4 and

5979

3.1, for example) and, moreover, it can and has been used to justify

5980

the state. In other words, "consent" in and of itself does not ensure

5981

that a given regime is not statist (see section 2.3 for more on this).

5982

So an argument along these lines is deeply flawed and can be used to

5983

justify regimes which are little better than "industrial feudalism"

5984

(such as, as indicated in section B.4, company towns, for example --

5985

an institution which right-libertarianism has no problem with). Even

5986

the "general libertarian law code," could be considered a "monopoly

5987

of government over a particular area," particularly if ordinary

5988

people have no real means of affecting the law code, either because

5989

it is market-driven and so is money-determined, or because it

5990

will be "natural" law and so unchangeable by mere mortals.

5991

5992

In other words, *if* the state "arrogates to itself a monopoly of force,

5993

of ultimate decision-making power, over a given area territorial area"

5994

[Rothbard, _The Ethics of Liberty_, p. 170] then its pretty clear that the

5995

property owner shares this power. The owner is, after all, the "ultimate

5996

decision-making power" in their workplace or on their land. If the boss takes

5997

a dislike to you (for example, you do not follow their orders) then you

5998

get fired. If you cannot get a job or rent the land without agreeing

5999

to certain conditions (such as not joining a union or subscribing

6000

to the "defence firm" approved by your employer) then you either

6001

sign the contract or look for something else. Of course Rothbard fails

6002

to note that bosses have this monopoly of power and is instead referring

6003

to "prohibiting the voluntary purchase and sale of defence and judicial

6004

services." [Op. Cit., p. 171] But just as surely as the law of contract

6005

allows the banning of unions from a property, it can just as surely

6006

ban the sale and purchase of defence and judicial services (it could

6007

be argued that market forces will stop this happening, but this is

6008

unlikely as bosses usually have the advantage on the labour market

6009

and workers have to compromise to get a job -- see section 10.2 on

6010

why this is the case). After all, in the company towns, only company

6011

money was legal tender and company police the only law enforcers.

6012

6013

Therefore, it is obvious that the "anarcho"-capitalist system meets

6014

the Weberian criteria of a monopoly to enforce certain rules in a

6015

given area of land. The "general libertarian law code" is a monopoly

6016

and property owners determine the rules that apply to their property.

6017

Moreover, if the rules that property owners enforce are subject to

6018

rules contained in the monopolistic "general libertarian law code" (for

6019

example, that they cannot ban the sale and purchase of certain products

6020

*definitely* meets the Weberian definition of the state (as described by

6021

Ayn Rand as an institution "that holds the exclusive power to *enforce*

6022

certain rules of conduct in a given geographical area" [_Capitalism: The

6023

Unknown Ideal_, p. 239]) as its "law code" overrides the desires of

6024

property owners to do what they like on their own property.

6025

6026

Therefore, no matter how you look at it, "anarcho"-capitalism and its

6027

"defence" market promotes a "monopoly of ultimate decision making power"

6028

over a "given territorial area". It is obvious that for anarchists, the

6029

"anarcho"-capitalist system is a state system. As, as we note, a reasonable

6030

case can be made for it also being a state in "anarcho"-capitalist theory

6031

as well.

6032

6033

So, in effect, "anarcho"-capitalism has a *different* sort of state, one

6034

in which bosses hire and fire the policeman. As Peter Sabatini notes [in

6035

_Libertarianism: Bogus Anarchy_], "[w]ithin Libertarianism, Rothbard

6036

represents a minority perspective that actually argues for the total

6037

elimination of the state. However Rothbard's claim as an anarchist is

6038

quickly voided when it is shown that he only wants an end to the public

6039

state. In its place he allows countless private states, with each person

6040

supplying their own police force, army, and law, or else purchasing these

6041

services from capitalist vendors. . . Rothbard sees nothing at all wrong

6042

with the amassing of wealth, therefore those with more capital will

6043

inevitably have greater coercive force at their disposal, just as

6044

they do now."

6045

6046

Far from wanting to abolish the state, then, "anarcho"-capitalists only

6047

desire to privatise it - to make it solely accountable to capitalist wealth.

6048

Their "companies" perform the same services as the state, for the same

6049

people, in the same manner. However, there is one slight difference.

6050

Property owners would be able to select between competing companies

6051

for their "services." Because such "companies" are employed by the boss,

6052

they would be used to reinforce the totalitarian nature of capitalist firms

6053

by ensuring that the police and the law they enforce are not even slightly

6054

accountable to ordinary people.

6055

6056

Looking beyond the "defence association" to the defence market itself (as

6057

we argued in the last section), this will become a cartel and so become

6058

some kind of public state. The very nature of the private state, its need

6059

to co-operate with others in the same industry, push it towards a

6060

monopoly network of firms and so a monopoly of force over a given

6061

area. Given the assumptions used to defend "anarcho"-capitalism, its

6062

system of private statism will develop into public statism - a state

6063

run by managers accountable only to the share-holding elite.

6064

6065

To quote Peter Marshall again, the "anarcho"-capitalists "claim that

6066

all would benefit from a free exchange on the market, it is by no means

6067

certain; any unfettered market system would most likely sponsor a

6068

reversion to an unequal society with defence associations perpetuating

6069

exploitation and privilege." [_Demanding the Impossible_, p. 565]

6070

History, and current practice, prove this point.

6071

6072

In short, "anarcho"-capitalists are not anarchists at all, they are just

6073

capitalists who desire to see private states develop -- states which are

6074

strictly accountable to their paymasters without even the sham of

6075

democracy we have today. Hence a far better name for "anarcho"-capitalism

6076

would be "private-state" capitalism. At least that way we get a fairer

6077

idea of what they are trying to sell us. As Bob Black writes in _The

6078

Libertarian as Conservative_, "To my mind a right-wing anarchist is just a

6079

minarchist who'd abolish the state to his own satisfaction by calling it

6080

something else. . . . They don't denounce what the state does, they just

6081

object to who's doing it."

6082

6083

6.5 What other effects would "free market" justice have?

6084

6085

Such a system would be dangerous simply because of the power it places

6086

in the hands of companies. As Michael Taylor notes, "whether the [protection]

6087

market is competitive or not, it must be remembered that the product

6088

is a peculiar one: when we buy cars or shoes or telephone services we

6089

do not give the firm power based on force, but armed protection agencies,

6090

like the state, make customers (their own and others') vulnerable, and

6091

having given them power we cannot be sure that they will use it only for

6092

our protection." [_Community, Anarchy and Liberty_, p. 65]

6093

6094

As we argued above, there are many reasons to believe that a "protection"

6095

market will place most of society (bar the wealthy elite) in a "vulnerable"

6096

position. One such reason is the assumptions of the "anarcho"-capitalists

6097

themselves. As they note, capitalism is marked by an extreme division of

6098

labour. Instead of everyone having all the skills they need, these skills

6099

are distributed throughout society and all (so it is claimed) benefit.

6100

6101

This applies equally to the "defence" market. People subscribe to a

6102

"defence firm" because they either cannot or do not want the labour of

6103

having to protect their own property and person. The skills of defence,

6104

therefore, are concentrated in these companies and so these firms will

6105

have an advantage in terms of experience and mental state (they are trained

6106

to fight) as well as, as seems likely, weaponry. This means that most normal

6107

people will be somewhat at a disadvantage if a cartel of defence firms

6108

decides to act coercively. The division of labour society will discourage

6109

the spread of skills required for sustained warfare throughout society

6110

and so, perhaps, ensure that customers remain "vulnerable." The price

6111

of liberty may be eternal vigilance, but are most people willing to

6112

include eternal preparation of war as well? For modern society, the

6113

answer seems to be no, they prefer to let others do that (namely the

6114

state and its armed forces). And, we should note, an armed society may be

6115

a polite one, but its politeness comes from fear, *not* mutual respect

6116

and so totally phoney and soul destroying.

6117

6118

If we look at inequality within society, this may produce a ghettoisation

6119

effect within "anarcho"-capitalism. As David Friedman notes, conflict

6120

between defence firms is bad for business. Conflict costs money both

6121

in terms of weaponry used and increased ("danger money") wages. For this

6122

reason he thinks that peaceful co-operation will exist between firms.

6123

However, if we look at poor areas with high crime rates then its clear

6124

that such an area will be a dangerous place. In other words, it is very

6125

likely to be high in conflict. But conflict increases costs, and so

6126

prices. Does this mean that those areas which need police most will

6127

also have the highest prices for law enforcement? That is the case

6128

with insurance now, so perhaps we will see whole areas turning into

6129

Hobbesian anarchy simply because the high costs associated with

6130

dangerous areas will make the effective demand for their services

6131

approach zero.

6132

6133

In a system based on "private statism," police and justice would be

6134

determined by "free market" forces. As indicated in section B.4.1,

6135

right-libertarians maintain that one would have few rights on other

6136

peoples' property, and so the owner's will would be the law (possibly

6137

restricted somewhat by a "general libertarian law code", perhaps not

6138

police protection would become victims of roving bandits and rampant

6139

crime, resulting in a society where the wealthy are securely protected

6140

in their bastions by their own armed forces, with a bunch of poor

6141

crowded around them for protection. This would be very similar to

6142

feudal Europe.

6143

6144

The competing police forces would also be attempting to execute the laws

6145

of their sponsors in areas that may not be theirs to begin with, which

6146

would lead to conflicts unless everyone agreed to follow a "general

6147

libertarian law code" (as Rothbard, for one, wants). If there were

6148

competing law codes, the problem of whose "laws" to select and enforce

6149

would arise, with each of the wealthy security sponsors desiring that

6150

their law control all of the land. And, as noted earlier, if there

6151

were *one* "libertarian law code," this would be a "monopoly of

6152

government" over a given area, and therefore statist.

6153

6154

In addition, it should be noted that the right-libertarian claim that

6155

under their system anarchistic associations would be allowed as long as

6156

they are formed voluntarily just reflects their usual vacuous concept of

6157

freedom. This is because such associations would exist within and be

6158

subject to the "general libertarian law code" of "anarcho"-capitalist

6159

society. These laws would reflect and protect the interests and power of

6160

those with capitalist property, meaning that unless these owners agree,

6161

trying to live an anarchist life would be nearly impossible (its all

6162

fine and well to say that those with property can do what they like, if

6163

you do not have property then experimentation could prove difficult --

6164

not to mention, of course, few areas are completely self-sufficient meaning

6165

that anarchistic associations will be subject to market forces, market

6166

forces which stress and reward the opposite of the values these communes

6167

were set up to create). Thus we must *buy* the right to be free!

6168

6169

If, as anarchists desire, most people refuse to recognise or defend the

6170

rights of private property and freely associate accordingly to organise

6171

their own lives and ignore their bosses, this would still be classed as

6172

"initiation of force" under "anarcho"-capitalism, and thus repressed.

6173

In other words, like any authoritarian system, the "rules" within

6174

"anarcho"-capitalism do not evolve with society and its changing

6175

concepts (this can be seen from the popularity of "natural law" with

6176

right-libertarians, the authoritarian nature of which is discussed

6177

in section 11).

6178

6179

Therefore, in "anarcho"-capitalism you are free to follow the (capitalist)

6180

laws and to act within the limits of these laws. It is only within this

6181

context that you can experiment (if you can afford to). If you act outside

6182

these laws, then you will be subject to coercion. The amount of coercion

6183

required to prevent such actions depends on how willing people are to

6184

respect the laws. Hence it is not the case that an "anarcho"-capitalist

6185

society is particularly conducive to social experimentation and free

6186

evolution, as its advocates like to claim. Indeed, the opposite may be the

6187

case, as any capitalist system will have vast differences of wealth and

6188

power within it, thus ensuring that the ability to experiment is limited

6189

to those who can afford it. As Jonathan Wolff points out, the "image of

6190

people freely moving from one utopia to another until they find their

6191

heaven, ignores the thought that certain choices may be irreversible. . .

6192

This thought may lead to speculation about whether a law of evolution

6193

would apply to the plural utopias. Perhaps, in the long run, we may find

6194

the framework regulated by the law of survival of the economically most

6195

fit, and so we would expect to see a development not of diversity but of

6196

homogeneity. Those communities with great market power would eventually

6197

soak up all but the most resistant of those communities around them."

6198

[_Robert Nozick: Property, Justice and the Minimal State_, p. 135]

6199

6200

And if the initial distribution of resources is similar to that already

6201

existing then the "economically most fit" will be capitalistic (as argued

6202

in section J.5.12, the capitalist market actively selects against

6203

co-operatives even though they are more productive). Given the head

6204

start provided by statism, it seems likely that explicitly capitalist

6205

utopia's would remain the dominant type (particularly as the rights

6206

framework is such as to protect capitalist property rights). Moreover,

6207

we doubt that most "anarcho"-capitalists would embrace the ideology if

6208

it was more than likely that non-capitalist utopias would overcome

6209

the capitalist ones (after all, they *are* self-proclaimed capitalists).

6210

6211

So, given that "anarcho"-capitalists who follow Murray Rothbard's ideas and

6212

minimal-statist right-libertarians agree that *all* must follow the basic

6213

"general libertarian law code" which defends capitalist property rights,

6214

we can safely say that the economically "most fit" would be capitalist ones.

6215

Hardly surprising if the law code reflects capitalist ideas of right and

6216

wrong. In addition, as George Reitzer has argued (see _The McDonaldization

6217

of Society_), capitalism is driven towards standardisation and conformity

6218

by its own logic. This suggests that plurality of communities would soon

6219

be replaced by a series of "communities" which share the same features

6220

of hierarchy and ruling elites. ("Anarcho"-capitalists who follow David

6221

Friedman's ideas consider it possible, perhaps likely, that a free market

6222

in laws will result in one standard law code and so this also applies to

6223

that school as well)

6224

6225

So, in the end, the "anarcho" capitalists argue that in their system you

6226

are free to follow the (capitalist) law and work in the (capitalist)

6227

economy, and if you are lucky, take part in a "commune" as a collective

6228

capitalist. How *very* generous of them! Of course, any attempt to

6229

change said rules or economy are illegal and would be stopped by private

6230

states.

6231

6232

As well as indicating the falsity of "anarcho"-capitalist claims to

6233

support "experimentation," this discussion has also indicated that

6234

coercion would not be absent from "anarcho"-capitalism. This would be the

6235

case only if everyone voluntarily respected private property rights and

6236

abided by the law (i.e. acted in a capitalist-approved way). As long as

6237

you follow the law, you will be fine -- which is exactly the same as under

6238

public statism. Moreover, if the citizens of a society do not want a

6239

capitalist order, it may require a lot of coercion to impose it. This

6240

can be seen from the experiences of the Italian factory occupations

6241

in 1920 (see section A.5.5), in which workers refused to accept capitalist

6242

property or authority as valid and ignored it. In response to this

6243

change of thought within a large part of society, the capitalists

6244

backed fascism in order to stop the evolutionary process within society.

6245

6246

The socialist economic historian Maurice Dobbs, after reviewing the private

6247

armies in 1920s and 1930s America made much the same point: "When business

6248

policy takes the step of financing and arming a mass political movement

6249

to capture the machinery of government, to outlaw opposing forms of

6250

organisation and suppress hostile opinions we have merely a further and

6251

more logical stage beyond [private armies]" [Op. Cit., p. 357]

6252

6253

(Noted Austrian Economist Ludwig von Mises whose extreme free market

6254

liberal political and economic ideas inspired right-libertarianism in

6255

many ways had this to say about fascism: "It cannot be denied that Fascism

6256

and similar movements aiming at the establishment of dictatorships are full

6257

of the best intentions and that their intervention has, for the moment,

6258

saved European civilisation. The merit that Fascism has thereby won for

6259

itself will live eternally in history." [_Liberalism_, p. 51])

6260

6261

This example illustrates the fact that capitalism *per se* is essentially

6262

authoritarian, because it is necessarily based on coercion and hierarchy,

6263

which explains why capitalists have resorted to the most extreme forms of

6264

authoritarianism -- including totalitarian dictatorship -- during crises

6265

that threatened the fundamental rules of the system itself. There is no

6266

reason to think that "anarcho"-capitalism would be any different.

6267

6268

Since "anarcho"-capitalism, with its private states, does not actually

6269

want to get rid of hierarchical forms of authority, the need for one

6270

government to unify the enforcement activities of the various defence

6271

companies becomes apparent. In the end, that is what "anarcho"-capitalism

6272

recognises with its "general libertarian law code" (based either on market

6273

forces or "natural law"). Thus it appears that one government/hierarchy

6274

over a given territory is inevitable under any form of capitalism. That

6275

being the case, it is obvious that a democratic form of statism, with

6276

its checks and balances, is preferable to a dictatorship that imposes

6277

"absolute" property rights and so "absolute" power.

6278

6279

Of course, we do have another option than either private or public

6280

statism. This is anarchism, the end of hierarchical authority and its

6281

replacement by the "natural" authority of communal and workplace

6282

self-management.

6283

6284

7 How does the history of "anarcho"-capitalism show that

6285

it is not anarchist?

6286

6287

Of course, "anarcho"-capitalism does have historic precedents and

6288

"anarcho"-capitalists spend considerable time trying to co-opt

6289

various individuals into their self-proclaimed tradition of

6290

"anti-statist" liberalism. That, in itself, should be enough to

6291

show that anarchism and "anarcho"-capitalism have little in

6292

common as anarchism developed in opposition to liberalism and

6293

its defence of capitalism. Unsurprisingly, these "anti-state"

6294

liberals tended to, at best, refuse to call themselves anarchists

6295

or, at worse, explicitly deny they were anarchists.

6296

6297

One "anarcho"-capitalist overview of their tradition is presented

6298

by David M. Hart. His perspective on anarchism is typical of the

6299

school, noting that in his essay anarchism or anarchist "are used

6300

in the sense of a political theory which advocates the maximum

6301

amount of individual liberty, a necessary condition of which is

6302

the elimination of governmental or other organised force." [David

6303

M. Hart, "Gustave de Molinari and the Anti-statist Liberal

6304

Tradition: Part I", pp. 263-290, _Journal of Libertarian Studies_,

6305

vol. V, no. 3, p. 284] Yet anarchism has *never* been solely

6306

concerned with abolishing the state. Rather, anarchists have always

6307

raised economic and social demands and goals along with their

6308

opposition to the state. As such, anti-statism may be a necessary

6309

condition to be an anarchist, but not a sufficient one to count a

6310

specific individual or theory as anarchist.

6311

6312

Specifically, anarchists have turned their analysis onto private

6313

property noting that the hierarchical social relationships created

6314

by inequality of wealth (for example, wage labour) restricts

6315

individual freedom. This means that if we do seek "the maximum

6316

of individual liberty" then our analysis cannot be limited to

6317

just the state or government. Consequently, to limit anarchism

6318

as Hart does requires substantial rewriting of history, as can

6319

be seen from his account of William Godwin.

6320

6321

Hart tries to co-opt of William Godwin into the ranks of "anti-state"

6322

liberalism, arguing that he "defended individualism and the right to

6323

property." [Op. Cit., p. 265] He, of course, quotes from Godwin to

6324

support his claim yet strangely truncates Godwin's argument to exclude

6325

his conclusion that "[w]hen the laws of morality shall be clearly

6326

understood, their excellence universally apprehended, and themselves

6327

seen to be coincident with each man's private advantage, the idea of

6328

property in this sense will remain, but no man will have the least

6329

desire, for purposes of ostentation or luxury, to possess more than

6330

his neighbours." [_An Enquiry into Political Justice_, p. 199] In

6331

other words, personal property (possession) would still exist but

6332

not private property in the sense of capital or inequality of wealth.

6333

6334

This analysis is confirmed in book 8 of Godwin's classic work

6335

entitled "On Property." Needless to say, Hart fails to mention

6336

this analysis, unsurprising as it was later reprinted as a socialist

6337

pamphlet. Godwin thought that the "subject of property is the

6338

key-stone that completes the fabric of political justice." Like

6339

Proudhon, Godwin subjects property as well as the state to an

6340

anarchist analysis. For Godwin, there were "three degrees" of

6341

property. The first is possession of things you need to live.

6342

The second is "the empire to which every man is entitled over

6343

the produce of his own industry." The third is "that which

6344

occupies the most vigilant attention in the civilised states

6345

of Europe. It is a system, in whatever manner established, by

6346

which one man enters into the faculty of disposing of the produce

6347

of another man's industry." He notes that it is "clear therefore

6348

that the third species of property is in direct contradiction to

6349

the second." [Op. Cit., p. 701 and p. 710-2]

6350

6351

Godwin, unlike classical liberals, saw the need to "point

6352

out the evils of accumulated property," arguing that the

6353

the "spirit of oppression, the spirit of servility, and the

6354

spirit of fraud . . . are the immediate growth of the

6355

established administration of property. They are alike hostile

6356

to intellectual and moral improvement." Like the socialists

6357

he inspired, Godwin argued that "it is to be considered that

6358

this injustice, the unequal distribution of property, the

6359

grasping and selfish spirit of individuals, is to be regarded

6360

as one of the original sources of government, and, as it rises

6361

in its excesses, is continually demanding and necessitating new

6362

injustice, new penalties and new slavery." He stressed, "let it

6363

never be forgotten that accumulated property is usurpation."

6364

[Op. Cit., p. 732, pp. 717-8, and p. 718]

6365

6366

Godwin argued against the current system of property and in favour

6367

of "the justice of an equal distribution of the good things of

6368

life." This would be based on "[e]quality of conditions, or,

6369

in other words, an equal admission to the means of improvement

6370

and pleasure" as this "is a law rigorously enjoined upon mankind

6371

by the voice of justice." [Op. Cit., p. 725 and p. 736] Thus his

6372

anarchist ideas were applied to private property, noting like

6373

subsequent anarchists that economic inequality resulted in the

6374

loss of liberty for the many and, consequently, an anarchist

6375

society would see a radical change in property and property rights.

6376

As Kropotkin noted, Godwin "stated in 1793 in a quite definite

6377

form the political and economic principle of Anarchism."

6378

Little wonder he, like so many others, argued that Godwin was "the

6379

first theoriser of Socialism without government -- that is to

6380

say, of Anarchism." [_Environment and Evolution_, p. 62 and p. 26]

6381

For Kropotkin, anarchism was by definition not restricted to

6382

purely political issues but also attacked economic hierarchy,

6383

inequality and injustice. As Peter Marshall confirms, "Godwin's

6384

economics, like his politics, are an extension of his ethics."

6385

[_Demanding the Impossible_, p. 210]

6386

6387

Godwin's theory of property is significant because it reflected

6388

what was to become standard nineteenth century socialist thought

6389

on the matter. In Britain, his ideas influenced Robert Owen and,

6390

as a result, the early socialist movement in that country. His

6391

analysis of property, as noted, predated Proudhon's classic

6392

anarchist analysis. As such, to state, as Hart did, that Godwin

6393

simply "concluded that the state was an evil which had to be

6394

reduced in power if not eliminated completely" while not noting

6395

his analysis of property gives a radically false presentation

6396

of his ideas. [Hart, Op. Cit., p. 265] However, it does fit

6397

into his flawed assertion that anarchism is purely concerned

6398

with the state. Any evidence to the contrary is simply ignored.

6399

6400

7.1 Are competing governments anarchism?

6401

6402

No, of course not. Yet according to "anarcho"-capitalism, it is.

6403

This can be seen from the ideas of Gustave de Molinari.

6404

6405

Hart is on firmer ground when he argues that the 19th century

6406

French economist Gustave de Molinari is the true founder of

6407

"anarcho"-capitalism. With Molinari, he argues, "the two different

6408

currents of anarchist thought converged: he combined the political

6409

anarchism of Burke and Godwin with the nascent economic anarchism

6410

of Adam Smith and Say to create a new forms of anarchism" that

6411

has been called "anarcho-capitalism, or free market anarchism."

6412

[Op. Cit., p. 269] Of course, Godwin (like other anarchists) did

6413

not limit his anarchism purely to "political" issues and so he

6414

discussed "economic anarchism" as well in his critique of private

6415

property (as Proudhon also did later). As such, to artificially

6416

split anarchism into political and economic spheres is both

6417

historically and logically flawed. While some dictionaries

6418

limit "anarchism" to opposition to the state, anarchists did

6419

and do not.

6420

6421

The key problem for Hart is that Molinari refused to call himself

6422

an anarchist. He did not even oppose government, as Hart himself

6423

notes Molinari proposed a system of insurance companies to

6424

provide defence of property and "called these insurance companies

6425

'governments' even though they did not have a monopoly within a

6426

given geographical area." As Hart notes, Molinari was the sole

6427

defender of such free-market justice at the time in France.

6428

[David M. Hart, "Gustave de Molinari and the Anti-statist Liberal

6429

Tradition: Part II", pp. 399-434,_Journal of Libertarian Studies_,

6430

vol. V, no. 4, p. 415 and p. 411] Molinari was clear that he wanted

6431

"a regime of free government, "counterpoising "monopolist or communist

6432

governments" to "free governments." This would lead to "freedom of

6433

government" rather than its abolition (not freedom *from* government).

6434

For Molinarie the future would not bring "the suppression of the

6435

state which is the dream of the anarchists . . . It will bring the

6436

diffusion of the state within society. That is . . . 'a free state

6437

in a free society.'" [quoted by Hart, Op. Cit., p. 429, p. 411 and

6438

p. 422] As such, Molinari can hardly be considered an anarchist,

6439

even if "anarchist" is limited to purely being against government.

6440

6441

Moreover, in another sense Molinari was in favour of the state.

6442

As we discuss in section 6, these companies would have a monopoly

6443

within a given geographical area -- they have to in order to

6444

enforce the property owner's power over those who use, but do

6445

not own, the property in question. The key contradiction can be

6446

seen in Molinari's advocating of company towns, privately owned

6447

communities (his term was a "proprietary company"). Instead of

6448

taxes, people would pay rent and the "administration of the

6449

community would be either left in the hands of the company itself

6450

or handled special organisations set up for this purpose." Within

6451

such a regime "those with the most property had proportionally the

6452

greater say in matters which affected the community." If the poor

6453

objected then they could simply leave. [Op. Cit., pp. 421-2 and

6454

p. 422]

6455

6456

Given this, the idea that Molinari was an anarchist in any form can

6457

be dismissed. His system was based on privatising government, not

6458

abolishing it (as he himself admitted). This would be different from

6459

the current system, of course, as landlords and capitalists would be

6460

hiring force directly to enforce their decisions rather than relying

6461

on a state which they control indirectly. This system, as we proved

6462

in section 6, would not be anarchist as can be seen from American

6463

history. There capitalists and landlords created their own private

6464

police forces and armies, which regularly attacked and murdered union

6465

organisers and strikers. As an example, there is Henry Ford's Service

6466

Department (private police force):

6467

6468

"In 1932 a hunger march of the unemployed was planned to march up

6469

to the gates of the Ford plant at Dearborn. . . The machine guns

6470

of the Dearborn police and the Ford Motor Company's Service Department

6471

killed [four] and wounded over a score of others. . . Ford was

6472

fundamentally and entirely opposed to trade unions. The idea of

6473

working men questioning his prerogatives as an owner was outrageous

6474

. . . [T]he River Rouge plant. . . was dominated by the autocratic

6475

regime of Bennett's service men. Bennett . . organise[d] and train[ed]

6476

the three and a half thousand private policemen employed by Ford. His

6477

task was to maintain discipline amongst the work force, protect Ford's

6478

property [and power], and prevent unionisation. . . Frank Murphy,

6479

the mayor of Detroit, claimed that 'Henry Ford employs some of the

6480

worst gangsters in our city.' The claim was well based. Ford's

6481

Service Department policed the gates of his plants, infiltrated

6482

emergent groups of union activists, posed as workers to spy on

6483

men on the line. . . Under this tyranny the Ford worker had no

6484

security, no rights. So much so that any information about the

6485

state of things within the plant could only be freely obtained

6486

from ex-Ford workers." [Huw Beynon, _Working for Ford_, pp. 29-30]

6487

6488

The private police attacked women workers handing out pro-union handbills

6489

and gave them "a severe beating." At Kansas and Dallas "similar beatings

6490

were handed out to the union men." This use of private police to control

6491

the work force was not unique. General Motors "spent one million dollars

6492

on espionage, employing fourteen detective agencies and two hundred spies

6493

at one time [between 1933 and 1936]. The Pinkerton Detective Agency found

6494

anti-unionism its most lucrative activity." [Op. Cit., p. 34 and p. 32]

6495

We must also note that the Pinkerton's had been selling their private

6496

police services for decades before the 1930s. For over 60 years the

6497

Pinkerton Detective Agency had "specialised in providing spies, agent

6498

provocateurs, and private armed forces for employers combating labour

6499

organisations." By 1892 it "had provided its services for management

6500

in seventy major labour disputes, and its 2 000 active agents and 30 000

6501

reserves totalled more than the standing army of the nation." [Jeremy

6502

Brecher, _Strike!_, p. 55] With this force available, little wonder

6503

unions found it so hard to survive in the USA.

6504

6505

Only an "anarcho"-capitalist would deny that this is a private government,

6506

employing private police to enforce private power. Given that unions could

6507

be considered as "defence" agencies for workers, this suggests a picture

6508

of how "anarcho"-capitalism may work in practice radically different from

6509

the pictures painted by its advocates. The reason is simple, it does not

6510

ignore inequality and subjects economics to an anarchist analysis. Little

6511

wonder, then, that Proudhon stressed that it "becomes necessary for the

6512

workers to form themselves into democratic societies, with equal conditions

6513

for all members, on pain of a relapse into feudalism." Anarchism, in

6514

other words, would see "[c]apitalistic and proprietary exploitation

6515

stopped everywhere, the wage system abolished" and so "the economic

6516

organisation [would] replac[e] the governmental and military system."

6517

[_The General Idea of the Revolution_, p. 227 and p. 281] Clearly, the

6518

idea that Proudhon shared the same political goal as Molinari is a joke.

6519

He would have dismissed such a system as little more than an updated form

6520

of feudalism in which the property owner is sovereign and the workers

6521

subjects (see section B.4 for more details).

6522

6523

Unsurprisingly, Molinari (unlike the individualist anarchists) attacked

6524

the jury system, arguing that its obliged people to "perform the duties

6525

of judges. This is pure communism." People would "judge according to the

6526

colour of their opinions, than according to justice." [quoted by Hart,

6527

Op. Cit., p. 409] As the jury system used amateurs (i.e. ordinary people)

6528

rather than full-time professionals it could not be relied upon to defend

6529

the power and property rights of the rich. As we noted in section 1.4,

6530

Rothbard criticised the individualist anarchists for supporting juries

6531

for essentially the same reasons.

6532

6533

But, as is clear from Hart's account, Molinari had little concern

6534

that working class people should have a say in their own lives beyond

6535

consuming goods. His perspective can be seen from his lament about

6536

those "collonies where slavery has been abolished without the compulsory

6537

labour being replaced with an equivalent quantity of free [sic!] labour

6538

[i.e., wage labour], there has occurred the opposite of what happens

6539

everyday before our eyes. Simple workers have been seen to exploit

6540

in their turn the industrial *entrepreneurs,* demanding from them

6541

wages which bear absolutely no relation to the legitimate share in

6542

the product which they ought to receive. The planters were unable

6543

to obtain for their sugar a sufficient price to cover the increase

6544

in wages, and were obliged to furnish the extra amount, at first

6545

out of their profits, and then out of their very capital. A

6546

considerable number of planters have been ruined as a result . . .

6547

It is doubtless better that these accumulations of capital should be

6548

destroyed than that generations of men should perish [Marx: 'how

6549

generous of M. Molinari'] but would it not be better if both survived?"

6550

[quoted by Karl Marx, _Capital_, vol. 1, p. 937f]

6551

6552

So workers exploiting capital is the "opposite of what happens everyday

6553

before our eyes"? In other words, it is normal that entrepreneurs

6554

"exploit" workers under capitalism? Similarly, what is a "legitimate

6555

share" which workers "ought to receive"? Surely that is determined by

6556

the eternal laws of supply and demand and not what the capitalists (or

6557

Molinari) thinks is right? And those poor former slave drivers, they

6558

really do deserve our sympathy. What horrors they face from the

6559

impositions subjected upon them by their ex-chattels -- they had to

6560

reduce their profits! How dare their ex-slaves refuse to obey them

6561

in return for what their ex-owners think was their "legitimate share

6562

in the produce"! How "simple" these workers are, not understanding

6563

the sacrifices their former masters suffer nor appreciating how much

6564

more difficult it is for their ex-masters to create "the product"

6565

without the whip and the branding iron to aid them! As Marx so

6566

rightly comments: "And what, if you please, is this 'legitimate

6567

share', which, according to [Molinari's] own admission, the capitalist

6568

in Europe daily neglects to pay? Over yonder, in the colonies, where the

6569

workers are so 'simple' as to 'exploit' the capitalist, M. Molinari

6570

feels a powerful itch to use police methods to set on the right road

6571

that law of supply and demand which works automatically everywhere

6572

else." [Op. Cit., p. 937f]

6573

6574

An added difficulty in arguing that Molinari was an anarchist is that he

6575

was a contemporary of Proudhon, the first self-declared anarchist, and lived

6576

in a country with a vigorous anarchist movement. Surely if he was really

6577

an anarchist, he would have proclaimed his kinship with Proudhon and joined

6578

in the wider movement. He did not, as Hart notes as regards Proudhon:

6579

6580

"their differences in economic theory were considerable, and it is probably

6581

for this reason that Molinari refused to call himself an anarchist in spite

6582

of their many similarities in political theory. Molinari refused to accept

6583

the socialist economic ideas of Proudhon . . . in Molinari's mind, the term

6584

'anarchist' was intimately linked with socialist and statist economic views."

6585

[Op. Cit., p. 415]

6586

6587

Yet Proudhon's economic views, like Godwin's, flowed from his anarchist

6588

analysis and principles. They cannot be arbitrarily separated as Hart

6589

suggests. So while arguing that "Molinari was just as much an anarchist

6590

as Proudhon," Hart forgets the key issue. Proudhon was aware that private

6591

property ensured that the proletarian did not exercise "self-government"

6592

during working hours, i.e. was not a self-governing individual. As for

6593

Hart claiming that Proudhon had "statist economic views" it simply shows

6594

how far an "anarcho"-capitalist perspective is from genuine anarchism.

6595

Proudhon's economic analysis, his critique of private property and

6596

capitalism, flowed from his anarchism and was an integral aspect of it.

6597

6598

To restrict anarchism purely to opposition to the state, Hart is

6599

impoverishing anarchist theory and denying its history. Given

6600

that anarchism was born from a critique of private property as well

6601

as government, this shows the false nature of Hart's claim that

6602

"Molinari was the first to develop a theory of free-market,

6603

proprietary anarchism that extended the laws of the market and

6604

a rigorous defence of property to its logical extreme." [Op. Cit.,

6605

p. 415 and p. 416] Hart shows how far from anarchism Molinari was

6606

as Proudhon had turned his anarchist analysis to property, showing

6607

that "defence of property" lead to the oppression of the many by

6608

the few in social relationships identical to those which mark

6609

the state. Moreover, Proudhon, argued the state would always be

6610

required to defend such social relations. Privatising it would

6611

hardly be a step forward.

6612

6613

Unsurprisingly, Proudhon dismissed the idea that the laissez faire

6614

capitalists shared his goals. "The school of Say," Proudhon argued,

6615

was "the chief focus of counter-revolution next to the Jesuits"

6616

and "has for ten years past seemed to exist only to protect and

6617

applaud the execrable work of the monopolists of money and necessities,

6618

deepening more and more the obscurity of a science naturally difficult

6619

and full of complications." Much the same can be said of "anarcho"-

6620

capitalists, incidentally. For Proudhon, "the disciples of Malthus and

6621

of Say, who oppose with all their might any intervention of the State

6622

in matters commercial or industrial, do not fail to avail themselves

6623

of this seemingly liberal attitude, and to show themselves more

6624

revolutionary than the Revolution. More than one honest searcher

6625

has been deceived thereby." However, this apparent "anti-statist"

6626

attitude of supporters of capitalism is false as pure free market

6627

capitalism cannot solve the social question, which arises because

6628

of capitalism itself. As such, it was impossible to abolish the

6629

state under capitalism. Thus "this inaction of Power in economic

6630

matters was the foundation of government. What need should we have

6631

of a political organisation, if Power once permitted us to enjoy

6632

economic order?" Instead of capitalism, Proudhon advocated the

6633

"constitution of Value," the "organisation of credit," the

6634

elimination of interest, the "establishment of workingmen's

6635

associations" and "the use of a just price." [_The General Idea

6636

of the Revolution, p. 225, p. 226 and p. 233]

6637

6638

Clearly, then, the claims that Molinari was an anarchist fail as

6639

he, unlike his followers, were aware of what anarchism actually

6640

stood for. Hart, in his own way, acknowledges this:

6641

6642

"In spite of his protestations to the contrary, Molinari should

6643

be considered an anarchist thinker. His attack on the state's

6644

monopoly of defence must surely warrant the description of

6645

anarchism. His reluctance to accept this label stemmed from the

6646

fact that the socialists had used it first to describe a form

6647

of non-statist society which Molinari definitely opposed. Like

6648

many original thinkers, Molinari had to use the concepts developed

6649

by others to describe his theories. In his case, he had come to

6650

the same political conclusions as the communist anarchists although

6651

he had been working within the liberal tradition, and it is

6652

therefore not surprising that the terms used by the two schools

6653

were not compatible. It would not be until the latter half of the

6654

twentieth century that radical, free-trade liberals would use the

6655

word 'anarchist' to describe their beliefs." [Op. Cit., p. 416]

6656

6657

It should be noted that Proudhon was *not* a communist-anarchist,

6658

but the point remains. The aims of anarchism were recognised by

6659

Molinari as being inconsistent with his ideology. Consequently,

6660

he (rightly) refused the label. If only his self-proclaimed

6661

followers in the "latter half of the twentieth century" did the

6662

same anarchists would not have to bother with them!

6663

6664

As such, it seems ironic that the founder of "anarcho"-capitalism

6665

should have come to the same conclusion as modern day anarchists

6666

on the subject of whether his ideas are a form of anarchism or not!

6667

6668

7.2 Is government compatible with anarchism?

6669

6670

Of course not, but ironically this is the conclusion arrived at

6671

by Hart's analyst of the British "voluntaryists," particularly

6672

Auberon Herbert. Voluntaryism was a fringe part of the right-wing

6673

individualist movement inspired by Herbert Spencer, a spokesman

6674

for free market capitalism in the later half of the nineteenth

6675

century. As with Molinari, there is a problem with presenting

6676

this ideology as anarchist, namely that its leading light,

6677

Herbert, explicitly rejected the label "anarchist."

6678

6679

Herbert was clearly aware of individualist anarchism and distanced

6680

himself from it. He argued that such a system would be "pandemonium."

6681

He thought that people should "not direct our attacks - as the

6682

anarchists do - *against all government*, against government in

6683

itself" but "only against the overgrown, the exaggerated, the

6684

insolent, unreasonable and indefensible forms of government, which

6685

are found everywhere today." Government should be "strictly limited

6686

to its legitimate duties in defence of self-ownership and individual

6687

rights." He stressed that "we are governmentalists . . . formally

6688

constituted by the nation, employing in this matter of force the

6689

majority method." Moreover, Herbert knew of, and rejected,

6690

individualist anarchism, considering it to be "founded on a fatal

6691

mistake." [_Essay X: The Principles Of Voluntaryism And Free Life_]

6692

As such, claims that he was an anarchist or "anarcho"-capitalist

6693

cannot be justified.

6694

6695

Hart is aware of this slight problem, quoting Herbert's claim that

6696

he aimed for "regularly constituted government, generally accepted by

6697

all citizens for the protection of the individual." [quoted by Hart,

6698

Op. Cit., p. 86] Like Molinari, Herbert was aware that anarchism

6699

was a form of socialism and that the political aims could not be

6700

artificially separated from its economic and social aims. As such,

6701

he was right *not* to call his ideas anarchism as it would result

6702

in confusion (particularly as anarchism was a much larger movement

6703

than his). As Hart acknowledges, "Herbert faced the same problems that

6704

Molinari had with labelling his philosophy. Like Molinari, he rejected

6705

the term 'anarchism,' which he associated with the socialism of Proudhon

6706

and . . . terrorism." While "quite tolerant" of individualist anarchism,

6707

he thought they "were mistaken in their rejections of 'government.'"

6708

However, Hart knows better than Herbert about his own ideas, arguing

6709

that his ideology "is in fact a new form of anarchism, since the most

6710

important aspect of the modern state, the monopoly of the use of force

6711

in a given area, is rejected in no uncertain terms by both men." [Op.

6712

Cit., p. 86] He does mention that Benjamin Tucker called Herbert a

6713

"true anarchist in everything but name," but Tucker denied that

6714

Kropotkin was an anarchist suggesting that he was hardly a reliable

6715

guide. [quoted by Hart, Op. Cit., p. 87] As it stands, it seems that

6716

Tucker was mistaken in his evaluation of Herbert's politics.

6717

6718

Economically, Herbert was not an anarchist, arguing that the state

6719

should protect Lockean property rights. Of course, Hart may argue

6720

that these economic differences are not relevant to the issue of

6721

Herbert's anarchism but that is simply to repeat the claim that

6722

anarchism is simply concerned with government, a claim which is

6723

hard to support. This position cannot be maintained, given that

6724

both Herbert and Molinari defended the right of capitalists and

6725

landlords to force their employees and tenants to follow their

6726

orders. Their "governments" existed to defend the capitalist from

6727

rebellious workers, to break unions, strikes and occupations. In

6728

other words, they were a monopoly of the use of force in a given

6729

area to enforce the monopoly of power in a given area (namely, the

6730

wishes of the property owner). While they may have argued that this

6731

was "defence of liberty," in reality it is defence of power and

6732

authority.

6733

6734

What about if we just look at the political aspects of his ideas?

6735

Did Herbert actually advocate anarchism? No, far from it. He clearly

6736

demanded a minimal state based on voluntary taxation. The state

6737

would not use force of any kind, "except for purposes of restraining

6738

force." He argued that in his system, while "the state should compel

6739

no services and exact no payments by force," it "should be free to

6740

conduct many useful undertakings . . . in competition with all voluntary

6741

agencies . . . in dependence on voluntary payments." [Herbert, Op. Cit.]

6742

As such, "the state" would remain and unless he is using the term "state"

6743

in some highly unusual way, it is clear that he means a system

6744

where individuals live under a single elected government as their

6745

common law maker, judge and defender within a given territory.

6746

6747

This becomes clearer once we look at how the state would be organised.

6748

In his essay "A Politician in Sight of Haven," Herbert does discuss

6749

the franchise, stating it would be limited to those who paid a

6750

voluntary "income tax," anyone "paying it would have the right

6751

to vote; those who did not pay it would be -- as is just --

6752

without the franchise. There would be no other tax." The law

6753

would be strictly limited, of course, and the "government . . .

6754

must confine itself simply to the defense of life and property,

6755

whether as regards internal or external defense." In other words,

6756

Herbert was a minimal statist, with his government elected by a

6757

majority of those who choose to pay their income tax and funded

6758

by that (and by any other voluntary taxes they decided to pay).

6759

Whether individuals and companies could hire their own private

6760

police in such a regime is irrelevant in determining whether it

6761

is an anarchy.

6762

6763

This can be best seen by comparing Herbert with Ayn Rand. No one

6764

would ever claim Rand was an anarchist, yet her ideas were extremely

6765

similar to Herbert's. Like Herbert, Rand supported laissez-faire

6766

capitalism and was against the "initiation of force." Like Herbert,

6767

she extended this principle to favour a government funded by voluntary

6768

means ["Government Financing in a Free Society," _The Virtue of

6769

Selfishness_, pp. 116-20] Moreover, like Herbert, she explicitly

6770

denied being an anarchist and, again like Herbert, thought the idea

6771

of competing defence agencies ("governments") would result in chaos.

6772

The similarities with Herbert are clear, yet no "anarcho"-capitalist

6773

would claim that Rand was an anarchist, yet they do claim that Herbert

6774

was.

6775

6776

This position is, of course, deeply illogical and flows from the

6777

non-anarchist nature of "anarcho"-capitalism. Perhaps unsurprisingly,

6778

when Rothbard discusses the ideas of the "voluntaryists" he fails to

6779

address the key issue of who determines the laws being enforced in

6780

society. For Rothbard, the key issue is *who* is enforcing the law,

6781

not where that law comes from (as long, of course, as it is a law

6782

code he approves of). The implications of this is significant, as

6783

it implies that "anarchism" need not be opposed to either the state

6784

nor government! This can be clearly seen from Rothbard's analysis of

6785

voluntary taxation.

6786

6787

Rothbard, correctly, notes that Herbert advocated voluntary taxation as

6788

the means of funding a state whose basic role was to enforce Lockean

6789

property rights. For Rothbard, the key issue was *not* who determines

6790

the law but who enforces it. For Rothbard, it should be privatised

6791

police and courts and he suggests that the "voluntary taxationists

6792

have never attempted to answer this problem; they have rather stubbornly

6793

assumed that no one would set up a competing defence agency within a

6794

State's territorial limits." If the state *did* bar such firms, then

6795

that system is not a genuine free market. However, "if the government

6796

*did* permit free competition in defence service, there would soon no

6797

longer be a central government over the territory. Defence agencies,

6798

police and judicial, would compete with one another in the same

6799

uncoerced manner as the producers of any other service on the market."

6800

[_Power and Market_, p. 122 and p. 123]

6801

6802

However, this misses the point totally. The key issue that Rothbard

6803

ignores is who determines the laws which these private "defence" agencies

6804

would enforce. If the laws are determined by a central government, then

6805

the fact that citizen's can hire private police and attend private courts

6806

does not stop the regime being statist. We can safely assume Rand, for

6807

example, would have had no problem with companies providing private security

6808

guards or the hiring of private detectives within the context of her

6809

minimal state. Ironically, Rothbard stresses the need for such a monopoly

6810

legal system:

6811

6812

"While 'the government' would cease to exist, the same cannot be said for

6813

a constitution or a rule of law, which, in fact, would take on in the free

6814

society a far more important function than at present. For the freely

6815

competing judicial agencies would have to be guided by a body of absolute

6816

law to enable them to distinguish objectively between defence and invasion.

6817

This law, embodying elaborations upon the basic injunction to defend person

6818

and property from acts of invasion, would be codified in the basic legal code.

6819

Failure to establish such a code of law would tend to break down the free

6820

market, for then defence against invasion could not be adequately achieved."

6821

[Op. Cit., p. 123-4]

6822

6823

So if you violate the "absolute law" defending (absolute) property rights

6824

then you would be in trouble. The problem now lies in determining who sets

6825

that law. Rothbard is silent on how his system of monopoly laws are determined

6826

or specified. The "voluntaryists" did propose a solution, namely a central

6827

government elected by the majority of those who voluntarily decided to pay

6828

an income tax. In the words of Herbert:

6829

6830

"We agree that there must be a central agency to deal with crime - an

6831

agency that defends the liberty of all men, and employs force against

6832

the uses of force; but my central agency rests upon voluntary support,

6833

whilst Mr. Levy's central agency rests on compulsory support." [quoted

6834

by Carl Watner, "The English Individualists As They Appear In Liberty,"

6835

pp. 191-211, _Benjamin R. Tucker and the Champions of Liberty_, p. 194]

6836

6837

And all Rothbard is concerned over private cops would exist or not! This

6838

lack of concern over the existence of the state and government flows from

6839

the strange fact that "anarcho"-capitalists commonly use the term "anarchism"

6840

to refer to any philosophy that opposes all forms of initiatory coercion.

6841

Notice that government does not play a part in this definition, thus

6842

Rothbard can analyse Herbert's politics without commenting on who

6843

determines the law his private "defence" agencies enforce. For Rothbard,

6844

"an anarchist society" is defined "as one where there is no legal possibility

6845

for coercive aggression against the person and property of any individual." He

6846

then moved onto the state, defining that as an "institution which possesses

6847

one or both (almost always both) of the following properties: (1) it acquires

6848

its income by the physical coercion known as 'taxation'; and (2) it acquires

6849

and usually obtains a coerced monopoly of the provision of defence service

6850

(police and courts) over a given territorial area." ["Society without a State",

6851

in _Nomos XIX_, Pennock and Chapman (eds.)., p. 192]

6852

6853

This is highly unusual definition of "anarchism," given that it utterly fails to

6854

mention or define government. This, perhaps, is understandable as any attempt

6855

to define it in terms of "monopoly of decision-making power" results in showing

6856

that capitalism is statist (see section 1 for a summary). The key issue here

6857

is the term "legal possibility." That suggestions a system of laws which

6858

determine what is "coercive aggression" and what constitutes what is and what

6859

is not legitimate "property." Herbert is considered by "anarcho"-capitalists as

6860

one of them. Which brings us to a strange conclusion, that for

6861

"anarcho"-capitalists you can have a system of "anarchism" in which there is

6862

a government and state -- as long as the state does not impose taxation nor

6863

stop private police forces from operating!

6864

6865

As Rothbard argues "if a government based on voluntary taxation permits free

6866

competition, the result will be the purely free-market system . . . The previous

6867

government would now simply be one competing defence agency among many on the

6868

market." [_Power and Market_, p. 124] That the government is specifying what

6869

is and is not legal does not seem to bother him or even cross his mind. Why

6870

should it, when the existence of government is irrelevant to his definition

6871

of anarchism and the state? That private police are enforcing a monopoly law

6872

determined by the government seems hardly a step in the right direction nor

6873

can it be considered as anarchism. Perhaps this is unsurprising, for under

6874

his system there would be "a basic, common Law Code" which "all would have to

6875

abide by" as well as "some way of resolving disputes that will gain a majority

6876

consensus in society . . . whose decision will be accepted by the great

6877

majority of the public." ["Society without a State," Op. Cit., p. 205]

6878

6879

At least Herbert is clear that this would be a government system, unlike

6880

Rothbard who assumes a monopoly law but seems to think that this is not a

6881

government or a state. As David Wieck argued, this is illogical for

6882

according to Rothbard "all 'would have to' conform to the same legal

6883

code" and this can only be achieved by means of "the forceful action

6884

of adherents to the code against those who flout it" and so "in his

6885

system *there would stand over against every individual the legal authority

6886

of all the others.* An individual who did not recognise private property as

6887

legitimate would surely perceive this as a tyranny of law, a tyranny of the

6888

majority or of the most powerful -- in short, a hydra-headed state. If the

6889

law code is itself unitary, then this multiple state might be said to have

6890

properly a single head -- the law . . . But it looks as though one might

6891

still call this 'a state,' under Rothbard's definition, by satisfying *de

6892

facto* one of his pair of sufficient conditions: 'It asserts and usually

6893

obtains a coerced monopoly of provision of defence service (police and

6894

courts) over a given territorial area' . . . Hobbes's individual sovereign

6895

would seem to have become many sovereigns -- with but one law, however, and

6896

in truth, therefore, a single sovereign in Hobbes's more important sense of

6897

the latter term. One might better, and less confusingly, call this a

6898

libertarian state than an anarchy." ["Anarchist Justice", in _Nomos XIX_,

6899

Pennock and Chapman (eds.)., pp. 216-7]

6900

6901

The obvious recipients of the coercion of the new state would be those who

6902

rejected the authority of their bosses and landlords, those who reject the

6903

Lockean property rights Rothbard and Herbert hold dear. In such cases, the

6904

rebels and any "defence agency" (like, say, a union) which defended them

6905

would be driven out of business as it violated the law of the land. How

6906

this is different from a state banning competing agencies is hard to

6907

determine. This is a "difficulty" argues Wieck, which "results from the

6908

attachment of a principle of private property, and of unrestricted

6909

accumulation of wealth, to the principle of individual liberty. This

6910

increases sharply the possibility that many reasonable people who respect

6911

their fellow men and women will find themselves outside the law because

6912

of dissent from a property interpretation of liberty." Similarly, there is

6913

the economic results of capitalism. "One can imagine," Wieck continues,

6914

"that those who lose out badly in the free competition of Rothbard's economic

6915

system, perhaps a considerable number, might regard the legal authority as an

6916

alien power, state for them, based on violence, and might be quite unmoved by

6917

the fact that, just as under nineteenth century capitalism, a principle of

6918

liberty was the justification for it all." [Op. Cit., p. 217 and pp. 217-8]

6919

6920

7.3 Can there be a "right-wing" anarchism?

6921

6922

Hart, of course, mentions the individualist anarchists, calling Tucker's

6923

ideas "*laissez faire* liberalism." [Op. Cit., p. 87] However, Tucker

6924

called his ideas "socialism" and presented a left-wing critique of most

6925

aspects of liberalism, particularly its Lockean based private property

6926

rights. Tucker based much of his ideas on property on Proudhon, so if

6927

Hart dismisses the latter as a socialist then this must apply to the

6928

former. Given that he notes that there are "two main kinds of anarchist

6929

thought," namely "communist anarchism which denies the right of an

6930

individual to seek profit, charge rent or interest and to own property"

6931

and a "'right-wing' proprietary anarchism, which vigorously defends

6932

these rights" then Tucker, like Godwin, would have to be placed in the

6933

"left-wing" camp. ["Gustave de Molinari and the Anti-statist Liberal

6934

Tradition: Part II", Op. Cit., p. 427] Tucker, after all, argued that

6935

he aimed for the end of profit, interest and rent and attacked private

6936

property in land and housing beyond "occupancy and use."

6937

6938

As can be seen, Hart's account of the history of "anti-state" liberalism

6939

is flawed. Godwin is included only by ignoring his views on property,

6940

views which in many ways reflects the later "socialist" (i.e.

6941

anarchist) analysis of Proudhon. He then discusses a few individuals

6942

who were alone in their opinions even within extreme free market right

6943

and all of whom knew of anarchism and explicitly rejected the name for

6944

their respective ideologies. In fact, they preferred the term "government"

6945

to describe their systems which, on the face of it, would be hard to

6946

reconcile with the usual "anarcho"-capitalist definition of anarchism

6947

as being "no government." Hart's discussion of individualist anarchism

6948

is equally flawed, failing to discuss their economic views (just as

6949

well, as its links to "left-wing" anarchism would be obvious).

6950

6951

However, the similarities of Molinari's views with what later became

6952

known as "anarcho"-capitalism are clear. Hart notes that with Molinari's

6953

death in 1912, "liberal anti-statism virtually disappeared until it was

6954

rediscovered by the economist Murray Rothbard in the late 1950's"

6955

["Gustave de Molinari and the Anti-statist Liberal Tradition: Part

6956

III", Op. Cit., p. 88] While this fringe is somewhat bigger than

6957

previously, the fact remains that the ideas expounded by Rothbard

6958

are just as alien to the anarchist tradition as Molinari's. It

6959

is a shame that Rothbard, like his predecessors, did not call

6960

his ideology something other than anarchism. Not only would it have

6961

been more accurate, it would also have lead to much less confusion

6962

and no need to write this section of the FAQ! As it stands, the

6963

only reason why "anarcho"-capitalism is considered a form of "anarchism"

6964

by some is because one person (Rothbard) decided to steal the

6965

name of a well established and widespread political and social theory

6966

and movement and apply it to an ideology with little, if anything,

6967

in common with it.

6968

6969

As Hart inadvertently shows, it is not a firm base to build a claim.

6970

That anyone can consider "anarcho"-capitalism as anarchist simply

6971

flows from a lack of knowledge about anarchism. As numerous anarchists

6972

have argued. For example, "Rothbard's conjunction of anarchism with

6973

capitalism," according to David Wieck, "results in a conception that is

6974

entirely outside the mainstream of anarchist theoretical writings or social

6975

movements . . . this conjunction is a self-contradiction." He stressed that

6976

"the main traditions of anarchism are entirely different. These traditions,

6977

and theoretical writings associated with them, express the perspectives and

6978

the aspirations, and also, sometimes, the rage, of the oppressed people in

6979

human society: not only those economically oppressed, although the major

6980

anarchist movements have been mainly movements of workers and peasants,

6981

but also those oppressed by power in all those social dimensions . . .

6982

including of course that of political power expressed in the state." In

6983

other words, "anarchism represents . . . a moral commitment (Rothbard's

6984

anarchism I take to be diametrically opposite)." ["Anarchist Justice",

6985

libertarian state than an anarchy." ["Anarchist Justice", in _Nomos XIX_,

6986

Pennock and Chapman (eds.), p. 215, p. 229 and p. 234]

6987

6988

It is a shame that some academics consider only the word Rothbard uses

6989

as relevant rather than the content and its relation to anarchist theory

6990

and history. If they did, they would soon realise that the expressed

6991

opposition of so many anarchists to "anarcho"-capitalism is something

6992

which cannot be ignored or dismissed. In other words, a "right-wing"

6993

anarchist cannot and does not exist, no matter how often they use that

6994

word to describe their ideology. As Bob Black put it, "a right-wing

6995

anarchist is just a minarchist who'd abolish the state to his own

6996

satisfaction by calling it something else . . . They don't denounce what

6997

the state does, they just object to who's doing it." [_Libertarian as

6998

Conservative_]

6999

7000

The reason is simple. Anarchist economics and politics cannot be artificially

7001

separated, they are linked. Godwin and Proudhon did not stop their

7002

analysis at the state. They extended it the social relationships produced

7003

by inequality of wealth, i.e. economic power as well as political power.

7004

To see why, we need only consult Rothbard's work. As noted in the last

7005

section, for Rothbard the key issue with the "voluntary taxationists"

7006

was not who determined the "body of absolute law" but rather who enforced

7007

it. In his discussion, he argued that a democratic "defence agency" is

7008

at a disadvantage in his "free market" system. As he put it:

7009

7010

"It would, in fact, be competing at a severe disadvantage, having been

7011

established on the principle of 'democratic voting.' Looked at as a

7012

market phenomenon, 'democratic voting' (one vote per person) is simply

7013

the method of the consumer 'co-operative.' Empirically, it has been

7014

demonstrated time and again that co-operatives cannot compete successfully

7015

against stock-owned companies, especially when both are equal before the

7016

law. There is no reason to believe that co-operatives for defence would

7017

be any more efficient. Hence, we may expect the old co-operative government

7018

to 'wither away' through loss of customers on the market, while joint-stock

7019

(i.e., corporate) defence agencies would become the prevailing market form."

7020

7021

Notice how he assumes that both a co-operative and corporation would be

7022

"equal before the law." But who determines that law? Obviously *not* a

7023

democratically elected government, as the idea of "one person, one vote"

7024

in determining the common law all are subject to is "inefficient." Nor does

7025

he think, like the individualist anarchists, that the law would be judged

7026

by juries along with the facts. As we note in section 1.4, he rejects

7027

that in favour of it being determined by "Libertarian lawyers and jurists."

7028

Thus the law is unchangeable by ordinary people and enforced by private

7029

defence agencies hired to protect the liberty and property of the owning

7030

class. In the case of a capitalist economy, this means defending the

7031

power of landlords and capitalists against rebel tenants and workers.

7032

7033

This means that Rothbard's "common Law Code" will be determined, interpreted,

7034

enforced and amended by corporations based on the will of the majority of

7035

shareholders, i.e. the rich. That hardly seems likely to produce equality

7036

before the law. As he argues in a footnote:

7037

7038

"There is a strong *a priori* reason for believing that corporations will be

7039

superior to co-operatives in any given situation. For if each owner receives

7040

only one vote regardless of how much money he has invested in a project

7041

(and earnings are divided in the same way), there is no incentive to invest

7042

more than the next man; in fact, every incentive is the other way. This

7043

hampering of investment militates strongly against the co-operative form."

7044

7045

So *if* the law is determined by the defence agencies and courts then it

7046

will be determined by those who have invested most in these companies. As

7047

it is unlikely that the rich will invest in defence firms which do not

7048

support their property rights, power, profits and definition of property

7049

rights, it is clear that agencies which favour the wealthy will survive

7050

on the market. The idea that market demand will counter this class rule

7051

seems unlikely, given Rothbard's own argument. After all, in order to

7052

compete successfully you need more than demand, you need source of

7053

investment. If co-operative defence agencies do form, they will be at

7054

a market disadvantage due to lack of investment. As argued in section

7055

J.5.12, even though co-operatives are more efficient than capitalist

7056

firms lack of investment (caused by the lack of control by capitalists

7057

Rothbard notes) stops them replacing wage slavery. Thus capitalist wealth

7058

and power inhibits the spread of freedom in production. If we apply his

7059

own argument to Rothbard's system, we suggest that the market in "defence"

7060

will also stop the spread of more libertarian associations thanks to

7061

capitalist power and wealth. In other words, like any market, Rothbard's

7062

"defence" market will simply reflect the interests of the elite, not

7063

the masses.

7064

7065

Moreover, we can expect any democratic defence agency (like a union) to

7066

support, say, striking workers or squatting tenants, to be crushed. This

7067

is because, as Rothbard stresses, *all* "defence" firms would be expected

7068

to apply the "common" law, as written by "Libertarian lawyers and jurists."

7069

If they did not they would quickly be labelled "outlaw" agencies and crushed

7070

by the others. Ironically, Tucker would join Bakunin and Kropotkin in an

7071

"anarchist" court accused to violating "anarchist" law by practising and

7072

advocating "occupancy and use" rather than the approved Rothbardian property

7073

rights. Even if these democratic "defence" agencies could survive and not

7074

be driven out of the market by a combination of lack of investment and

7075

violence due to their "outlaw" status, there is another problem. As we

7076

discussed in section 1, landlords and capitalists have a monopoly of

7077

decision making power over their property. As such, they can simply refuse

7078

to recognise any democratic agency as a legitimate defence association and

7079

use the same tactics perfected against unions to ensure that it does not

7080

gain a foothold in their domain (see section 6 for more details).

7081

7082

Clearly, then, a "right-wing" anarchism is impossible as any system based

7083

on capitalist property rights will simply be an oligarchy run by and for

7084

the wealthy. As Rothbard notes, any defence agency based on democratic

7085

principles will not survive in the "market" for defence simply because it

7086

does not allow the wealthy to control it and its decisions. Little

7087

wonder Proudhon argued that laissez-faire capitalism meant "the victory

7088

of the strong over the weak, of those who own property over those who own

7089

nothing." [quoted by Peter Marshall, _Demanding the Impossible_, p. 259]

7090

7091

8 What role did the state take in the creation of capitalism?

7092

7093

If the "anarcho"-capitalist is to claim with any plausibility that "real"

7094

capitalism is non-statist or that it can exist without a state, it must

7095

be shown that capitalism evolved naturally, in opposition to state

7096

intervention. However, in reality, the opposite is the case. Capitalism

7097

was born from state intervention and, in the words of Kropotkin, "the State

7098

. . . and capitalism . . . developed side by side, mutually supporting and

7099

re-enforcing each other." [_Kropotkin's Revolutionary Pamphlets_, p. 181]

7100

7101

Numerous writers have made this point. For example, in Karl Polanyi's

7102

flawed masterpiece _The Great Transformation_ we read that "the road to

7103

the free market was opened and kept open by an enormous increase in

7104

continuous, centrally organised and controlled interventionism" by the

7105

state [p. 140]. This intervention took many forms -- for example, state

7106

support during "mercantilism," which allowed the "manufactures" (i.e.

7107

industry) to survive and develop, enclosures of common land, and so forth.

7108

In addition, the slave trade, the invasion and brutal conquest of the

7109

Americas and other "primitive" nations, and the looting of gold, slaves,

7110

and raw materials from abroad also enriched the European economy, giving

7111

the development of capitalism an added boost. Thus Kropotkin:

7112

7113

"The history of the genesis of capital has already been told by socialists

7114

many times. They have described how it was born of war and pillage, of

7115

slavery and serfdom, of modern fraud and exploitation. They have shown

7116

how it is nourished by the blood of the worker, and how little by little

7117

it has conquered the whole world." [Op. Cit., p. 207]

7118

7119

Or, if Kropotkin seems too committed to be fair, we have John Stuart Mill's

7120

statement that:

7121

7122

"The social arrangements of modern Europe commenced from a distribution

7123

of property which was the result, not of just partition, or acquisition

7124

by industry, but of conquest and violence. . . " [_Principles of Political

7125

Economy_, p. 15]

7126

7127

Therefore, when supporters of "libertarian" capitalism say they are

7128

against the "initiation of force," they mean only *new* initiations

7129

of force; for the system they support was born from numerous initiations

7130

of force in the past. And, as can be seen from the history of the last

7131

100 years, it also requires state intervention to keep it going (section

7132

D.1, "Why does state intervention occur?," addresses this point in some

7133

detail). Indeed, many thinkers have argued that it was precisely this

7134

state support and coercion (particularly the separation of people from

7135

the land) that played the *key* role in allowing capitalism to develop

7136

rather than the theory that "previous savings" did so. As the noted

7137

German thinker Franz Oppenheimer argued, "the concept of a 'primitive

7138

accumulation,' or an original store of wealth, in land and in movable

7139

property, brought about by means of purely economic forces" while

7140

"seem[ing] quite plausible" is in fact "utterly mistaken; it is a

7141

'fairly tale,' or it is a class theory used to justify the privileges

7142

of the upper classes." [_The State_, pp. 5-6]

7143

7144

This thesis will be discussed in the following sections. It is, of course,

7145

ironic to hear right-wing libertarians sing the praises of a capitalism

7146

that never existed and urge its adoption by all nations, in spite of the

7147

historical evidence suggesting that only state intervention made

7148

capitalist economies viable -- even in that Mecca of "free enterprise,"

7149

the United States. As Noam Chomsky argues, "who but a lunatic could have

7150

opposed the development of a textile industry in New England in the early

7151

nineteenth century, when British textile production was so much more

7152

efficient that half the New England industrial sector would have gone

7153

bankrupt without very high protective tariffs, thus terminating industrial

7154

development in the United States? Or the high tariffs that radically

7155

undermined economic efficiency to allow the United States to develop steel

7156

and other manufacturing capacities? Or the gross distortions of the

7157

market that created modern electronics?" [_World Orders, Old and New_,

7158

p. 168]. To claim, therefore, that "mercantilism" is not capitalism

7159

makes little sense. Without mercantilism, "proper" capitalism would never

7160

have developed, and any attempt to divorce a social system from its roots

7161

is ahistoric and makes a mockery of critical thought.

7162

7163

Similarly, it is somewhat ironic when "anarcho"-capitalists and right

7164

libertarians claim that they support the freedom of individuals to

7165

choose how to live. After all, the working class was not given *that*

7166

particular choice when capitalism was developing. Indeed, their right

7167

to choose their own way of life was constantly violated and denied. So

7168

to claim that *now* (after capitalism has been created) we get the

7169

chance to try and live as we like is insulting in the extreme. The

7170

available options we have are not independent of the society we live

7171

in and are decisively shaped by the past. To claim we are "free" to

7172

live as we like (within the laws of capitalism) is basically to argue

7173

that we are able to "buy" the freedom that every individual is due from

7174

those who have stolen it from us in the first place!

7175

7176

Needless to say, some right-libertarians recognise that the state played

7177

a massive role in encouraging industrialisation (more correct to say

7178

"proletarianisation" as it created a working class which did not own

7179

the tools they used, although we stress that this process started on

7180

the land and not in industry). So they contrast "bad" business people

7181

(who took state aid) and "good" ones. Thus Rothbard's comment that

7182

Marxists have "made no particular distinction between 'bourgeoisie'

7183

who made use of the state, and bourgeoisie who acted on the free

7184

market." [_The Ethics of Liberty_, p. 72]

7185

7186

But such an argument is nonsense as it ignores the fact that the "free

7187

market" is a network (and defined by the state by the property rights

7188

it enforces). For example, the owners of the American steel and other

7189

companies who grew rich and their companies big behind protectionist

7190

walls are obviously "bad" bourgeoisie. But are the bourgeoisie who supplied

7191

the steel companies with coal, machinery, food, "defence" and so on not also

7192

benefiting from state action? And the suppliers of the luxury goods to the

7193

wealthy steel company owners, did they not benefit from state action? Or the

7194

suppliers of commodities to the workers that laboured in the steel factories

7195

that the tariffs made possible, did they not benefit? And the suppliers to

7196

these suppliers? And the suppliers to these suppliers? Did not the users of

7197

technology first introduced into industry by companies protected by state

7198

orders also not benefit? Did not the capitalists who had a large and landless

7199

working class to select from benefit from the "land monopoly" even though

7200

they may not have, unlike other capitalists, directly advocated it? It

7201

increased the pool of wage labour for *all* capitalists and increased their

7202

bargaining position/power in the labour market at the expense of the working

7203

class. In other words, such a policy helped maintain capitalist market power,

7204

irrespective of whether individual capitalists encouraged politicians to

7205

vote to create/maintain it. And, similarly, *all* capitalists benefited

7206

from the changes in common law to recognise and protect capitalist private

7207

property and rights that the state enforced during the 19th century (see

7208

section B.2.5).

7209

7210

It appears that, for Rothbard, the collusion between state and business

7211

is the fault, not of capitalism, but of particular capitalists. The system

7212

is pure; only individuals are corrupt. But, for anarchists, the origins

7213

of the modern state-capitalist system lies not in the individual qualities

7214

of capitalists as such but in the dynamic and evolution of capitalism itself

7215

against the destructive actions of the market, individual qualities and

7216

so forth. In other words, Rothbard's claims are flawed -- they fail to

7217

understand capitalism as a *system* and its dynamic nature.

7218

7219

Indeed, if we look at the role of the state in creating capitalism we

7220

could be tempted to rename "anarcho"-capitalism "marxian-capitalism".

7221

This is because, given the historical evidence, a political theory

7222

can be developed by which the "dictatorship of the bourgeoisie" is

7223

created and that this capitalist state "withers away" into anarchy.

7224

That this means rejecting the economic and social ideas of Marxism

7225

and their replacement by their direct opposite should not mean that

7226

we should reject the idea (after all, that is what "anarcho"-capitalism

7227

has done to Individualist Anarchism!). But we doubt that many

7228

"anarcho"-capitalists will accept such a name change (even though

7229

this would reflect their politics far better; after all they do not

7230

object to past initiations of force, just current ones and many do

7231

seem to think that the modern state *will* wither away due to market

7232

forces).

7233

7234

But this is beside the point. The fact remains that state action was

7235

required to create and maintain capitalism. Without state support it

7236

is doubtful that capitalism would have developed at all.

7237

7238

So, when the right suggests that "we" be "left alone," what they mean by

7239

"we" comes into clear focus when we consider how capitalism developed.

7240

Artisans and peasants were only "left alone" to starve, and the working

7241

classes of industrial capitalism were only "left alone" outside work and

7242

for only as long as they respected the rules of their "betters." As for

7243

the other side of the class divide, they desire to be "left alone" to

7244

exercise their power over others, as we will see. That modern "capitalism"

7245

is, in effect, a kind of "corporate mercantilism," with states providing

7246

the conditions that allow corporations to flourish (e.g. tax breaks,

7247

subsidies, bailouts, anti-labour laws, etc.) says more about the statist

7248

roots of capitalism than the ideologically correct definition of capitalism

7249

used by its supporters.

7250

7251

8.1 What social forces lay behind the rise of capitalism?

7252

7253

Capitalist society is a relatively recent development. As Murray Bookchin

7254

points out, for a "long era, perhaps spanning more than five centuries,"

7255

capitalism "coexisted with feudal and simple commodity relationships"

7256

in Europe. He argues that this period "simply cannot be treated as

7257

'transitional' without reading back the present into the past." [_From

7258

Urbanisation to Cities_, p. 179] In other words, capitalism was not

7259

a inevitable outcome of "history" or social evolution.

7260

7261

He goes on to note that capitalism existed "with growing significance

7262

in the mixed economy of the West from the fourteenth century up to the

7263

seventeenth" but that it "literally exploded into being in Europe,

7264

particularly England, during the eighteenth and especially nineteenth

7265

centuries." [Op. Cit., p. 181] The question arises, what lay behind

7266

this "growing significance"? Did capitalism "explode" due to its

7267

inherently more efficient nature or where there other, non-economic,

7268

forces at work? As we will show, it was most definitely the later one --

7269

capitalism was born not from economic forces but from the political

7270

actions of the social elites which its usury enriched. Unlike artisan

7271

(simple commodity) production, wage labour generates inequalities

7272

and wealth for the few and so will be selected, protected and encouraged

7273

by those who control the state in their own economic and social interests.

7274

7275

The development of capitalism in Europe was favoured by two social elites,

7276

the rising capitalist class within the degenerating medieval cities and

7277

the absolutist state. The medieval city was "thoroughly changed by the

7278

gradual increase in the power of commercial capital, due primarily to

7279

foreign trade. . . By this the inner unity of the commune was loosened,

7280

giving place to a growing caste system and leading necessarily to a

7281

progressive inequality of social interests. The privileged minorities

7282

pressed ever more definitely towards a centralisation of the political

7283

forces of the community. . . Mercantilism in the perishing city republics

7284

led logically to a demand for larger economic units [i.e. to nationalise

7285

the market]; and by this the desire for stronger political forms was

7286

greatly strengthened. . . . Thus the city gradually became a small

7287

state, paving the way for the coming national state." [Rudolf Rocker,

7288

_Nationalism and Culture_, p. 94]

7289

7290

The rising economic power of the proto-capitalists conflicted with that of

7291

the feudal lords, which meant that the former required help to consolidate

7292

their position. That aid came in the form of the monarchical state. With

7293

the force of absolutism behind it, capital could start the process of

7294

increasing its power and influence by expanding the "market" through

7295

state action.

7296

7297

As far as the absolutist state was concerned, it "was dependent upon the

7298

help of these new economic forces, and vice versa. . . ." "The absolutist

7299

state," Rocker argues, "whose coffers the expansion of commerce filled. . .,

7300

at first furthered the plans of commercial capital. Its armies and fleets . . .

7301

contributed to the expansion of industrial production because they

7302

demanded a number of things for whose large-scale production the shops

7303

of small tradesmen were no longer adapted. Thus gradually arose the

7304

so-called manufactures, the forerunners of the later large industries."

7305

[Op. Cit., p. 117-8]

7306

7307

Some of the most important state actions from the standpoint of early

7308

industry were the so-called Enclosure Acts, by which the "commons" -- the

7309

free farmland shared communally by the peasants in most rural villages --

7310

was "enclosed" or incorporated into the estates of various landlords as

7311

private property (see section 8.3). This ensured a pool of landless

7312

workers who had no option but to sell their labour to capitalists. Indeed,

7313

the widespread independence caused by the possession of the majority of

7314

households of land caused the rising class of merchants to complain

7315

"that men who should work as wage-labourers cling to the soil, and in

7316

the naughtiness of their hearts prefer independence as squatters to

7317

employment by a master." [R.H Tawney, cited by Allan Elgar in _The

7318

Apostles of Greed_, p. 12]

7319

7320

In addition, other forms of state aid ensured that capitalist firms got

7321

a head start, so ensuring their dominance over other forms of work (such

7322

as co-operatives). A major way of creating a pool of resources that

7323

could be used for investment was the use of mercantilist policies which

7324

used protectionist measures to enrich capitalists and landlords at the

7325

expense of consumers and their workers. For example, one of most common

7326

complaints of early capitalists was that workers could not turn up to

7327

work regularly. Once they had worked a few days, they disappeared as

7328

they had earned enough money to live on. With higher prices for food,

7329

caused by protectionist measures, workers had to work longer and harder

7330

and so became accustomed to factory labour. In addition, mercantilism

7331

allowed native industry to develop by barring foreign competition and

7332

so allowed industrialists to reap excess profits which they could then

7333

use to increase their investments. In the words of Marian-socialist

7334

economic historian Maurice Dobbs:

7335

7336

"In short, the Mercantile System was a system of State-regulated exploitation

7337

through trade which played a highly important rule in the adolescence of

7338

capitalist industry: it was essentially the economic policy of an age of

7339

primitive accumulation." [_Studies in Capitalism Development_, p. 209]

7340

7341

As Rocker summarises, "when abolutism had victoriously overcome all

7342

opposition to national unification, but its furthering of mercantilism

7343

and economic monopoly it gave the whole social evolution a direction

7344

which could only lead to capitalism." [Op. Cit., pp. 116-7]

7345

7346

This process of state aid in capitalist development was also seen in the

7347

United States of America. As Edward Herman points out, the "level of

7348

government involvement in business in the United States from the late

7349

eighteenth century to the present has followed a U-shaped pattern: There

7350

was extensive government intervention in the pre-Civil War period (major

7351

subsidies, joint ventures with active government participation and direct

7352

government production), then a quasi-laissez faire period between the

7353

Civil War and the end of the nineteenth century [a period marked by

7354

"the aggressive use of tariff protection" and state supported railway

7355

construction, a key factor in capitalist expansion in the USA], followed

7356

by a gradual upswing of government intervention in the twentieth century,

7357

which accelerated after 1930." [_Corporate Control, Corporate Power_,

7358

p. 162]

7359

7360

Such intervention ensured that income was transferred from workers to

7361

capitalists. Under state protection, America industrialised by forcing

7362

the consumer to enrich the capitalists and increase their capital stock.

7363

"According to one study, of the tariff had been removed in the 1830s

7364

'about half the industrial sector of New England would have been

7365

bankrupted' . . . the tariff became a near-permanent political

7366

institution representing government assistance to manufacturing. It

7367

kept price levels from being driven down by foreign competition and

7368

thereby shifted the distribution of income in favour of owners of

7369

industrial property to the disadvantage of workers and customers."

7370

[Richard B. Du Boff, _Accumulation and Power_, p. 56]

7371

7372

This protection was essential, for as Du Boff notes, the "end of the

7373

European wars in 1814 . . . reopened the United States to a flood of

7374

British imports that drove many American competitors out of business.

7375

Large portions of the newly expanded manufacturing base were wiped out,

7376

bringing a decade of near-stagnation." Unsurprisingly, the "era of

7377

protectionism began in 1816, with northern agitation for higher

7378

tariffs. . . " [Op. Cit., p. 14, p. 55]

7379

7380

Combined with ready repression of the labour movement and government

7381

"homesteading" acts (see section 8.5), tariffs were the American

7382

equivalent of mercantilism (which, after all, was above all else a

7383

policy of protectionism, i.e. the use of government to stimulate

7384

the growth of native industry). Only once America was at the top

7385

of the economic pile did it renounce state intervention (just as

7386

Britain did, we must note).

7387

7388

This is *not* to suggest that government aid was limited to tariffs.

7389

The state played a key role in the development of industry and

7390

manufacturing. As John Zerzan notes, the "role of the State is

7391

tellingly reflected by the fact that the 'armoury system' now rivals

7392

the older 'American system of manufactures' term as the more

7393

accurate to describe the new system of production methods" developed

7394

in the early 1800s. [_Elements of Refusal_, p. 100] Moreover, the

7395

"lead in technological innovation [during the US Industrial

7396

Revolution] came in armaments where assured government orders

7397

justified high fixed-cost investments in special-pursue machinery

7398

and managerial personnel. Indeed, some of the pioneering effects

7399

occurred in government-owned armouries." [William Lazonick, _Competitive

7400

Advantage on the Shop Floor_, p. 218] The government also "actively

7401

furthered this process [of "commercial revolution"] with public

7402

works in transportation and communication." [Richard B. Du Boff,

7403

Op. Cit., p. 15]

7404

7405

In addition to this "physical" aid, "state government provided critical

7406

help, with devices like the chartered corporation" [Ibid.] and,

7407

as we noted in section B.2.5, changes in the legal system which

7408

favoured capitalist interests over the rest of society.

7409

7410

Interestingly, there was increasing inequality between 1840 and 1860 in

7411

the USA This coincided with the victory of wage labour and industrial

7412

capitalism -- the 1820s "constituted a watershed in U.S. life. By

7413

the end of that decade . . .industrialism assured its decisive American

7414

victory, by the end of the 1830s all of its cardinal features were

7415

definitely present." [John Zerzan, Op. Cit., p. 99] This is unsurprising,

7416

for as we have argued many times, the capitalist market tends to

7417

increase, not reduce, inequalities between individuals and classes.

7418

Little wonder the Individualist Anarchists at the time denounced the

7419

way that property had been transformed into "a power [with which] to

7420

accumulate an income" (to use the words of J.K. Ingalls).

7421

7422

Over all, as Paul Ormerod puts it, the "advice to follow pure free-market

7423

polices seems . . . to be contrary to the lessons of virtually the whole

7424

of economic history since the Industrial Revolution . . . every country

7425

which has moved into . . . strong sustained growth . . . has done so

7426

in outright violation of pure, free-market principles." "The model of

7427

entrepreneurial activity in the product market, with judicious state

7428

support plus repression in the labour market, seems to be a good model

7429

of economic development." [_The Death of Economics_, p. 63]

7430

7431

Thus the social forces at work creating capitalism was a combination of

7432

capitalist activity and state action. But without the support of the

7433

state, it is doubtful that capitalist activity would have been enough

7434

to generate the initial accumulation required to start the economic

7435

ball rolling. Hence the necessity of Mercantilism in Europe and its

7436

modified cousin of state aid, tariffs and "homestead acts" in America.

7437

7438

8.2 What was the social context of the statement "laissez-faire?"

7439

7440

The honeymoon of interests between the early capitalists and autocratic

7441

kings did not last long. "This selfsame monarchy, which for weighty

7442

reasons sought to further the aims of commercial capital and was. . .

7443

itself aided in its development by capital, grew at last into a

7444

crippling obstacle to any further development of European industry."

7445

[Rudolf Rocker, _Nationalism and Culture_, p. 117]

7446

7447

This is the social context of the expression "laissez-faire" -- a

7448

system which has outgrown the supports that protected it in its

7449

early stages of growth. Just as children eventually rebel against

7450

the protection and rules of their parents, so the capitalists rebelled

7451

against the over-bearing support of the absolutist state. Mercantilist

7452

policies favoured some industries and harmed the growth of industrial

7453

capitalism in others. The rules and regulations imposed upon those

7454

it did favour reduced the flexibility of capitalists to changing

7455

environments. As Rocker argues, "no matter how the abolutist state

7456

strove, in its own interest, to meety the demands of commerce, it

7457

still put on industry countless fetters which became gradually

7458

more and more oppressive . . . [it] became an unbearable burden . . .

7459

which paralysed all economic and social life." [Op. Cit., p. 119]

7460

All in all, mercantilism became more of a hindrance than a help

7461

and so had to be replaced. With the growth of economic and

7462

social power by the capitalist class, this replacement was

7463

made easier.

7464

7465

Errico Malatesta notes, "[t]he development of production, the vast expansion

7466

of commerce, the immeasurable power assumed by money . . . have guaranteed

7467

this supremacy [of economic power over the political power] to the

7468

capitalist class which, no longer content with enjoying the support of

7469

the government, demanded that government arise from its own ranks. A

7470

government which owed its origin to the right of conquest . . . though

7471

subject by existing circumstances to the capitalist class, went on

7472

maintaining a proud and contemptuous attitude towards its now wealthy

7473

former slaves, and had pretensions to independence of domination. That

7474

government was indeed the defender, the property owners' gendarme, but

7475

the kind of gendarmes who think they are somebody, and behave in an

7476

arrogant manner towards the people they have to escort and defend, when

7477

they don't rob or kill them at the next street corner; and the capitalist

7478

class got rid of it . . . [and replaced it] by a government [and state] . . .

7479

at all times under its control and specifically organised to defend that

7480

class against any possible demands by the disinherited." [_Anarchy_,

7481

pp. 19-20]

7482

7483

Malatesta here indicates the true meaning of "leave us alone," or

7484

"laissez-faire." The *absolutist* state (not "the state" per se) began

7485

to interfere with capitalists' profit-making activities and authority,

7486

so they determined that it had to go -- as happened, for example, in the

7487

English, French and American revolutions. However, in other ways, state

7488

intervention in society was encouraged and applauded by capitalists. "It

7489

is ironic that the main protagonists of the State, in its political and

7490

administrative authority, were the middle-class Utilitarians, on the other

7491

side of whose Statist banner were inscribed the doctrines of economic

7492

Laissez Faire" [E.P. Thompson, _The Making of the English Working Class_,

7493

p. 90]. Capitalists simply wanted *capitalist* states to replace

7494

monarchical states, so that heads of government would follow state

7495

economic policies regarded by capitalists as beneficial to their

7496

class as a whole. And as development economist Lance Taylor argues:

7497

7498

"In the long run, there are no laissez-faire transitions to modern

7499

economic growth. The state has always intervened to create a capitalist

7500

class, and then it has to regulate the capitalist class, and then the

7501

state has to worry about being taken over by the capitalist class,

7502

but the state has always been there." [quoted by Noam Chomsky, _Year

7503

501_, p. 104]

7504

7505

In order to attack mercantilism, the early capitalists had to ignore

7506

the successful impact of its policies in developing industry and

7507

a "store of wealth" for future economic activity. As William Lazonick

7508

points out, "the political purpose of [Adam Smith's] the _Wealth of

7509

Nations_ was to attack the mercantilist institutions that the British

7510

economy had built up over the previous two hundred years. . . In

7511

his attack on these institutions, Smith might have asked why the

7512

extent of the world market available to Britain in the late eighteenth

7513

century was *so uniquely under British control.* If Smith had

7514

asked this 'big question,' he might have been forced to grant credit

7515

for [it] . . . to the very mercantilist institutions he was

7516

attacking . . ." Moreover, he "might have recognised the integral

7517

relation between economic and political power in the rise of Britain

7518

to international dominance." Overall, "[w]hate the British advocates

7519

of laissez-faire neglected to talk about was the role that a system

7520

of national power had played in creating conditions for Britain to

7521

embark on its dynamic development path . . . They did not bother to

7522

ask how Britain had attained th[e] position [of 'workshop of the

7523

world'], while they conveniently ignored the on going system of

7524

national power - the British Empire -- that . . . continued to

7525

support Britain's position." [_Business Organisation and the Myth

7526

of the Market Economy_, p. 2, p. 3, p.5]

7527

7528

Similar comments are applicable to American supporters of laissez

7529

faire who fail to notice that the "traditional" American support for

7530

world-wide free trade is quite a recent phenomenon. It started only

7531

at the end of the Second World War (although, of course, *within*

7532

America military Keynesian policies were utilised). While American

7533

industry was developing, the country had no time for laissez-faire.

7534

After it had grown strong, the United States began preaching laissez-faire

7535

to the rest of the world -- and began to kid itself about its own

7536

history, believing its slogans about laissez-faire as the secret of

7537

its success. In addition to the tariff, nineteenth-century America

7538

went in heavily for industrial planning--occasionally under that name

7539

but more often in the name of national defence. The military was the

7540

excuse for what is today termed rebuilding infrastructure, picking

7541

winners, promoting research, and co-ordinating industrial growth (as

7542

it still is, we should add).

7543

7544

As Richard B. Du Boff points out, the "anti-state" backlash of the

7545

1840s onwards in America was highly selective, as the general

7546

opinion was that "[h]enceforth, if governments wished to subsidise

7547

private business operations, there would be no objection. But if

7548

public power were to be used to control business actions or if

7549

the public sector were to undertake economic initiatives on its

7550

own, it would run up against the determined opposition of private

7551

capital." [_Accumulation and Power_, p. 26] In other words, the

7552

state could aid capitalists indirectly (via tariffs, land policy,

7553

repression of the labour movement, infrastructure subsidy and so

7554

on) and it would "leave them alone" to oppress and exploit workers,

7555

exploit consumers, build their industrial empires and so forth.

7556

7557

So, the expression "laissez-faire" dates from the period when

7558

capitalists were objecting to the restrictions that helped create

7559

them in the first place. It has little to do with freedom as such and

7560

far more to do with the needs of capitalist power and profits (as Murray

7561

Bookchin argues, it is an error to depict this "revolutionary era and its

7562

democratic aspirations as 'bourgeois,' an imagery that makes capitalism

7563

a system more committed to freedom, or even ordinary civil liberties,

7564

than it was historically" [_From Urbanisation to Cities_, p. 180f]).

7565

Takis Fotopoules, in his essay "The Nation-state and the Market",

7566

indicates that the social forces at work in "freeing" the market

7567

did not represent a "natural" evolution towards freedom:

7568

7569

"Contrary to what liberals and Marxists assert, marketisation of the

7570

economy was not just an evolutionary process, following the expansion of

7571

trade under mercantilism . . . modern [i.e. capitalist] markets did not

7572

evolve out of local markets and/or markets for foreign goods . . . the

7573

nation-state, which was just emerging at the end of the Middle Ages,

7574

played a crucial role creating the conditions for the 'nationalisation'

7575

of the market . . . and . . . by freeing the market [i.e. the rich and

7576

proto-capitalists] from effective social control." [_Society and Nature_,

7577

Vol. 3, pp. 44-45]

7578

7579

The "freeing" of the market thus means freeing those who "own" most of

7580

the market (i.e. the wealthy elite) from "effective social control," but

7581

the rest of society was not as lucky. Peter Kropotkin makes a similar point

7582

in _Modern Science and Anarchism_, "[w]hile giving the capitalist any

7583

degree of free scope to amass his wealth at the expense of the helpless

7584

labourers, the government has *nowhere* and *never*. . .afforded the

7585

labourers the opportunity 'to do as they pleased'." [_Kropotkin's

7586

Revolutionary Pamphlets_, p. 182]

7587

7588

The one essential form of support the "Libertarian" right wants the state

7589

(or "defence" firms) to provide capitalism is the enforcement of property

7590

rights -- the right of property owners to "do as they like" on their own

7591

property, which can have obvious and extensive social impacts. What

7592

"libertarian" capitalists object to is attempts by others -- workers,

7593

society as a whole, the state, etc. -- to interfere with the authority

7594

of bosses. That this is just the defence of privilege and power (and

7595

*not* freedom) has been discussed in section B and elsewhere in

7596

section F, so we will not repeat ourselves here.

7597

7598

Samuel Johnson once observed that "we hear the loudest *yelps* for

7599

liberty among the drivers of Negroes." Our modern "libertarian"

7600

capitalist drivers of wage-slaves are yelping for exactly the

7601

same kind of "liberty." [Johnson quoted in Noam Chomsky, _Year 501_,

7602

p. 141]

7603

7604

8.3 What other forms did state intervention in creating capitalism take?

7605

7606

Beyond being a paymaster for new forms of production and social relations

7607

and defending the owners' power, the state intervened economically in

7608

other ways as well. As we noted in section B.2.5, the state played a key

7609

role in transforming the law codes of society in a capitalistic fashion,

7610

ignoring custom and common law to do so. Similarly, the use of tariffs

7611

and the granting of monopolies to companies played an important role

7612

in accumulating capital at the expense of working people, as did the

7613

breaking of unions and strikes by force.

7614

7615

However, one of the most blatant of these acts was the enclosure of

7616

common land. In Britain, by means of the Enclosure Acts, land that

7617

had been freely used by poor peasants for farming their small family

7618

plots was claimed by large landlords as private property. As E.P. Thompson

7619

notes, "Parliament and law imposed capitalist definitions to exclusive

7620

property in land" [_Customs in Common_, p. 163]. Property rights, which

7621

exclusively favoured the rich, replaced the use rights and free agreement

7622

that had governed peasant's use of the commons. Unlike use rights, which

7623

rest in the individual, property rights require state intervention to

7624

create and maintain.

7625

7626

This stealing of the land should not be under estimated. Without land,

7627

you cannot live and have to sell your liberty to others. This places

7628

those with capital at an advantage, which will tend to increase,

7629

rather than decrease, the inequalities in society (and so place the

7630

landless workers at an increasing disadvantage over time). This

7631

process can be seen from early stages of capitalism. With the

7632

enclosure of the land, an agricultural workforce was created which

7633

had to travel where the work was. This influx of landless ex-peasants

7634

into the towns ensured that the traditional guild system crumbled

7635

and was transformed into capitalistic industry with bosses and wage

7636

slaves rather than master craftsmen and their journeymen. Hence the

7637

enclosure of land played a key role, for "it is clear that economic

7638

inequalities are unlikely to create a division of society into an

7639

employing master class and a subject wage-earning class, unless

7640

access to the mans of production, including land, is by some means

7641

or another barred to a substantial section of the community."

7642

[Maurice Dobbs, _Studies in Capitalist Development_, p. 253]

7643

7644

The importance of access to land is summarised by this limerick

7645

by the followers of Henry George (a 19th century writer who argued

7646

for a "single tax" and the nationalisation of land). The Georgites

7647

got their basic argument on the importance of land down these few,

7648

excellent lines:

7649

7650

A college economist planned

7651

To live without access to land

7652

He would have succeeded

7653

But found that he needed

7654

Food, shelter and somewhere to stand.

7655

7656

Thus the Individualist (and other) anarchists' concern over the

7657

"land monopoly" of which the Enclosure Acts were but one part.

7658

The land monopoly, to use Tucker's words, "consists in the

7659

enforcement by government of land titles which do not rest upon

7660

personal occupancy and cultivation." [_The Anarchist Reader_,

7661

p. 150] It is important to remember that wage labour first

7662

developed on the land and it was the protection of land titles

7663

of landlords and nobility, combined with enclosure, that meant

7664

people could not just work their own land.

7665

7666

In other words, the circumstances so created by enclosing the land

7667

and enforcing property rights to large estates ensured that capitalists

7668

did not have to point a gun at workers head to get them to work long hours

7669

in authoritarian, dehumanising conditions. In such circumstances,

7670

when the majority are dispossessed and face the threat of starvation,

7671

poverty, homelessness and so on, "initiation of force" is *not required.*

7672

But guns *were* required to enforce the system of private property that

7673

created the labour market in the first place, to enforce the enclosure

7674

of common land and protect the estates of the nobility and wealthy.

7675

7676

In addition to increasing the availability of land on the market, the

7677

enclosures also had the effect of destroying working-class independence.

7678

Through these Acts, innumerable peasants were excluded from access to

7679

their former means of livelihood, forcing them to migrate to the cities

7680

to seek work in the newly emerging factories of the budding capitalist

7681

class, who were thus provided with a ready source of cheap labour. The

7682

capitalists, of course, did not describe the results this way, but

7683

attempted to obfuscate the issue with their usual rhetoric about

7684

civilisation and progress. Thus John Bellers, a 17th-century supporter

7685

of enclosures, claimed that commons were "a hindrance to Industry, and .

7686

. . Nurseries of Idleness and Insolence." The "forests and great Commons

7687

make the Poor that are upon them too much like the *indians.*" [quoted by

7688

Thompson, Op. Cit., p. 163] Elsewhere Thompson argues that the commons

7689

"were now seen as a dangerous centre of indiscipline . . . Ideology was

7690

added to self-interest. It became a matter of public-spirited policy

7691

for gentlemen to remove cottagers from the commons, reduce his labourers

7692

to dependence . . ." [_The Making of the English Working Class_,

7693

pp. 242-3]

7694

7695

The commons gave working-class people a degree of independence which

7696

allowed them to be "insolent" to their betters. This had to be stopped,

7697

as it undermined to the very roots of authority relationships within

7698

society. The commons *increased* freedom for ordinary people and made

7699

them less willing to follow orders and accept wage labour. The reference

7700

to "Indians" is important, as the independence and freedom of Native

7701

Americans is well documented. The common feature of both cultures was

7702

communal ownership of the means of production and free access to it

7703

(usufruct). This is discussed further in section I.7 (Won't Libertarian

7704

Socialism destroy individuality?)

7705

7706

As the early American economist Edward Wakefield noted in 1833, "where

7707

land is cheap and all are free, where every one who so pleases can easily

7708

obtain a piece of land for himself, not only is labour dear, as respects

7709

the labourer's share of the product, but the difficulty is to obtain

7710

combined labour at any price." [_England and America_, quoted by

7711

Jeremy Brecher and Tim Costello, _Commonsense for Hard Times_,

7712

p. 24]

7713

7714

The enclosure of the commons (in whatever form it took -- see section

7715

8.5 for the US equivalent) solved both problems -- the high cost of

7716

labour, and the freedom and dignity of the worker. The enclosures

7717

perfectly illustrate the principle that capitalism requires a state to

7718

ensure that the majority of people do not have free access to any means

7719

of livelihood and so must sell themselves to capitalists in order to

7720

survive. There is no doubt that if the state had "left alone" the European

7721

peasantry, allowing them to continue their collective farming practices

7722

("collective farming" because, as Kropotkin shows in _Mutual Aid_, the

7723

peasants not only shared the land but much of the farm labour as well),

7724

capitalism could not have taken hold (see _Mutual Aid_, pp. 184-189,

7725

for more on the European enclosures). As Kropotkin notes, "[i]nstances

7726

of commoners themselves dividing their lands were rare, everywhere the

7727

State coerced them to enforce the division, or simply favoured the

7728

private appropriation of their lands" by the nobles and wealthy.

7729

[_Mutual Aid_, p. 188]

7730

7731

Thus Kropotkin's statement that "to speak of the natural death of the

7732

village community [or the commons] in virtue of economical law is as

7733

grim a joke as to speak of the natural death of soldiers slaughtered

7734

on a battlefield." [Op. Cit., p. 189]

7735

7736

Like the more recent case of fascist Chile, "free market" capitalism was

7737

imposed on the majority of society by an elite using the authoritarian

7738

state. This was recognised by Adam Smith when he opposed state

7739

intervention in _The Wealth of Nations_. In Smith's day, the government

7740

was openly and unashamedly an instrument of wealth owners. Less than

7741

10 per cent of British men (and no women) had the right to vote. When

7742

Smith opposed state interference, he was opposing the imposition of

7743

wealth owners' interests on everybody else (and, of course, how "liberal",

7744

nevermind "libertarian", is a political system in which the many follow

7745

the rules and laws set-down in the so-called interests of all by the

7746

few? As history shows, any minority given, or who take, such power *will*

7747

abuse it in their own interests). Today, the situation is reversed, with

7748

neo-liberals and right libertarians opposing state interference in the

7749

economy (e.g. regulation of Big Business) so as to prevent the public

7750

from having even a minor impact on the power or interests of the elite.

7751

7752

The fact that "free market" capitalism always requires introduction by an

7753

authoritarian state should make all honest "Libertarians" ask: How "free"

7754

is the "free market"? And why, when it is introduced, do the rich get

7755

richer and the poor poorer? This was the case in Chile (see Section

7756

C.11). For the poverty associated with the rise of capitalism in England

7757

200 years ago, E.P. Thompson's _The Making of the English Working Class_

7758

provides a detailed discussion. Howard Zinn's _A People's History of the

7759

United States_ describes the poverty associated with 19th-century US

7760

capitalism.

7761

7762

8.4 Aren't the enclosures a socialist myth?

7763

7764

The short answer is no, they are not. While a lot of historical analysis

7765

has been spent in trying to deny the extent and impact of the enclosures,

7766

the simple fact is (in the words of noted historian E.P. Thompson)

7767

enclosure "was a plain enough case of class robbery, played according

7768

to the fair rules of property and law laid down by a parliament of

7769

property-owners and lawyers." [_The Making of the English Working

7770

Class_, pp. 237-8]

7771

7772

The enclosures were one of the ways that the "land monopoly" was created.

7773

The land monopoly was used to refer to capitalist property rights and

7774

ownership of land by (among others) the Individualist Anarchists. Instead

7775

of an "occupancy and use" regime advocated by anarchists, the land monopoly

7776

allowed a few to bar the many from the land -- so creating a class of

7777

people with nothing to sell but their labour. While this monopoly is less

7778

important these days in developed nations (few people know how to farm)

7779

it was essential as a means of consolidating capitalism. Given the choice,

7780

most people preferred to become independent farmers rather than wage workers

7781

(see next section).

7782

7783

However, the importance of the enclosure movement is downplayed by

7784

supporters of capitalism. Little wonder, for it is something of an

7785

embarrassment for them to acknowledge that the creation of capitalism

7786

was somewhat less than "immaculate" -- after all, capitalism is portrayed

7787

as an almost ideal society of freedom. To find out that an idol has

7788

feet of clay and that we are still living with the impact of its

7789

origins is something pro-capitalists must deny. So *is* the enclosures

7790

a socialist myth? Most claims that it is flow from the work of the

7791

historian J.D. Chambers' famous essay "Enclosures and the Labour Supply

7792

in the Industrial Revolution." [_Economic History Review_, 2nd series,

7793

no. 5, August 1953] In this essay, Chambers attempts to refute Karl

7794

Marx's account of the enclosures and the role it played in what Marx

7795

called "primitive accumulation."

7796

7797

We cannot be expected to provide an extensive account of the debate

7798

that has raged over this issue. All we can do is provide a summary

7799

of the work of William Lazonick who presented an excellent reply to

7800

those who claim that the enclosures were an unimportant historical

7801

event. We are drawing upon his summary of his excellent essay "Karl

7802

Marx and Enclosures in England" [_Review of Radical Political Economy_,

7803

no. 6, Summer, 1974] which can be found in his books _Competitive

7804

Advantage on the Shop Floor_ and _Business Organisation and the Myth

7805

of the Market Economy_. There are three main claims against the socialist

7806

account of the enclosures. We will cover each in turn.

7807

7808

Firstly, it is often claimed that the enclosures drove the uprooted

7809

cottager and small peasant into industry. However, this was never

7810

claimed. It is correct that the agricultural revolution associated

7811

with the enclosures *increased* the demand for farm labour as claimed

7812

by Chambers and others. And this is the whole point - enclosures

7813

created a pool of dispossessed labourers who had to sell their

7814

time/liberty to survive. The "critical transformation was not the

7815

level of agricultural employment before and after enclosure but

7816

the changes in employment relations caused by the reorganisation

7817

of landholdings and the reallocation of access to land." [_Competitive

7818

Advantage on the Shop Floor_, p. 30] Thus the key feature of the

7819

enclosures was that it created a supply for farm labour, a supply

7820

that had no choice but to work for another. This would drive down

7821

wages and increase demand. Moreover, freed from the land, these

7822

workers could later move to the towns in search for better work.

7823

7824

Secondly, it is argued that the number of small farm owners increased,

7825

or at least did not greatly decline, and so the enclosure movement was

7826

unimportant. Again, this misses the point. Small farm owners can still

7827

employ wage workers (i.e. become capitalist farmers as opposed to

7828

"yeomen" -- independent peasant proprietor). As Lazonick notes, "[i]t

7829

is true that after 1750 some petty proprietors continued to occupy

7830

and work their own land. But in a world of capitalist agriculture,

7831

the yeomanry no longer played an important role in determining the

7832

course of capitalist agriculture. As a social class that could

7833

influence the evolution of British economy society, the yeomanry

7834

had disappeared." [Op. Cit., p. 32]

7835

7836

Thirdly, it is often claimed that it was population growth, rather than

7837

enclosures, that caused the supply of wage workers. So was population

7838

growth more important that enclosures? Maurice Dobbs argues that "the

7839

centuries in which a proletariat was most rapidly recruited were apt to

7840

be those of slow rather than of rapid natural increase of population,

7841

and the paucity or plenitude of a labour reserve in different countries

7842

was not correlated with comparable difference in their rates of

7843

population-growth." [_Studies in Capitalist Development_, p. 223]

7844

Moreover, the population argument ignores the question of whether

7845

the changes in society caused by enclosures and the rise of capitalism

7846

have an impact on the observed trends towards earlier marriage and

7847

larger families after 1750. Lazonick argues that "[t]here is reason

7848

to believe that they did." [Op. Cit., p. 33] Also, of course, the use

7849

of child labour in the factories created an economic incentive to have

7850

more children, an incentive created by the developing capitalist system.

7851

Overall, Lazonick notes that "[t]o argue that population growth created

7852

the industrial labour supply is to ignore these momentous social

7853

transformations" associated with the rise of capitalism. [_Business

7854

Organisation and the Myth of the Market Economy_, p. 273]

7855

7856

In other words, there is good reason to think that the enclosures, far

7857

from being some kind of socialist myth, in fact played a key role in

7858

the development of capitalism. As Lazonick himself notes, "Chambers

7859

misunderstood" "the argument concerning the 'institutional creation'

7860

of a proletarianised (i.e. landless) workforce. Indeed, Chamber's

7861

own evidence and logic tend to support the Marxian [and anarchist!]

7862

argument, when it is properly understood." [Op. Cit., p. 273]

7863

7864

8.5 What about the lack of enclosures in the Americas?

7865

7866

The enclosure movement was but one way of creating the "land monopoly"

7867

which ensured the creation of a working class. The circumstances facing

7868

the ruling class in the Americas were distinctly different than in

7869

the Old World and so the "land monopoly" took a different form there.

7870

In the Americas, enclosures were unimportant as customary land rights

7871

did not really exist. Here the problem was that (after the original

7872

users of the land were eliminated, of course) there were vast tracks

7873

of land available for people to use.

7874

7875

Unsurprisingly, there was a movement towards independent farming and

7876

this pushed up the price of labour, by reducing the supply. Capitalists

7877

found it difficult to find workers willing to work for them at wages

7878

low enough to provide them with sufficient profits. It was due the

7879

difficulty in finding cheap enough labour that capitalists in America

7880

turned to slavery. All things being equal, wage labour *is* more

7881

productive than slavery. But in early America all things were *not*

7882

equal. Having access to cheap (indeed, free) land meant that working

7883

people had a choice, and few desired to become wage slaves. Because

7884

of this, capitalists turned to slavery in the South and the "land

7885

monopoly" in the North and West.

7886

7887

This was because, in the words of Maurice Dobbs, it "became clear to

7888

those who wished to reproduce capitalist relations of production in

7889

the new country that the foundation-stone of their endeavour must be

7890

the restriction of land-ownership to a minority and the exclusion of

7891

the majority from any share in [productive] property." [_Studies in

7892

Capitalist Development_, pp. 221-2] As one radical historian puts

7893

it, "[w]hen land is 'free' or 'cheap'. as it was in different regions

7894

of the United States before the 1830s, there was no compulsion for

7895

farmers to introduce labour-saving technology. As a result,

7896

'independent household production' . . . hindered the development

7897

of capitalism . . . [by] allowing large portions of the population

7898

to escape wage labour." [Charlie Post, "The 'Agricultural Revolution'

7899

in the United States", pp. 216-228, _Science and Society_, vol. 61,

7900

no. 2, p. 221]

7901

7902

It was precisely this option (i.e. of independent production) that

7903

had to be destroyed in order for capitalist industry to develop.

7904

The state had to violate the holy laws of "supply and demand"

7905

by controlling the access to land in order to ensure the normal

7906

workings of "supply and demand" in the labour market (i.e. that

7907

the bargaining position on the labour market favoured employer

7908

over employee). Once this situation became the typical one (i.e.

7909

when the option of self-employment was effectively eliminated)

7910

a (protectionist based) "laissez-faire" approach could be adopted

7911

and state action used only to protect private property from the

7912

actions of the dispossessed.

7913

7914

So how was this transformation of land ownership achieved?

7915

7916

Instead of allowing settlers to appropriate their own farms as was

7917

the case before the 1830s, the state stepped in once the army had

7918

cleared out the original users. Its first major role was to enforce

7919

legal rights of property on unused land. Land stolen from the Native

7920

Americans was sold at auction to the highest bidders, namely speculators,

7921

who then sold it on to farmers. This process started right "after

7922

the revolution, [when] huge sections of land were bought up by rich

7923

speculators" and their claims supported by the law [Howard Zinn, _A

7924

People's History of the United States_, p. 125] Thus land which should

7925

have been free was sold to land-hungry farmers and the few enriched

7926

themselves at the expense of the many. Not only did this increase

7927

inequality within society, it also encouraged the development of wage

7928

labour -- having to pay for land would have ensured that many immigrants

7929

remained on the East Coast until they had enough money. Thus a pool of

7930

people with little option but to sell their labour was increased due to

7931

state protection of unoccupied land. That the land usually ended up in

7932

the hands of farmers did not (could not) countermand the shift in class

7933

forces that this policy created.

7934

7935

This was also the essential role of the various "Homesteading Acts" and,

7936

in general, the "Federal land law in the 19th century provided for the

7937

sale of most of the public domain at public auction to the higher bidder

7938

. . . Actual settlers were forced to buy land from speculators, at

7939

prices considerably above the federal minimal price" (which few people

7940

could afford anyway) [Charlie Post, Op. Cit., p. 222]. Little wonder

7941

the Individualist Anarchists supported an "occupancy and use" system

7942

of land ownership as a key way of stopping capitalist and landlord

7943

usury as well as the development of capitalism itself.

7944

7945

This change in the appropriation of land had significant effects on

7946

agriculture and the desirability of taking up farming for immigrants.

7947

As Post notes, "[w]hen the social conditions for obtaining and maintaining

7948

possession of land change, as they did in the midwest between 1830 and

7949

1840, pursuing the goal of preserving [family ownership and control] . . .

7950

produced very different results. In order to pay growing mortgages,

7951

debts and taxes, family farmers were compelled to specialise production

7952

toward cash crops and to market more and more of their output."

7953

[Op. Cit., p. 221-2]

7954

7955

So, in order to pay for land which was formerly free, farmers got

7956

themselves into debt and increasingly turned to the market to pay it

7957

off. Thus, the "Federal land system, by transforming land into a commodity

7958

and stimulating land speculation, made the midwestern farmers dependent

7959

upon markets for the continual possession of their farms." [Charlie

7960

Post, Op. Cit., p. 223] Once on the market, farmers had to invest in

7961

new machinery and this also got them into debt. In the face of a bad

7962

harvest or market glut, they could not repay their loans and their

7963

farms had to be sold to so do so. By 1880, 25% of all farms were

7964

rented by tenants, and the numbers kept rising.

7965

7966

This means that Murray Rothbard's comments that "once the land was

7967

purchased by the settler, the injustice disappeared" are nonsense -- the

7968

injustice was transmitted to other parts of society and this, along

7969

with the legacy of the original injustice, lived on and helped transform

7970

society towards capitalism [_The Ethics of Liberty_, p. 73]. In

7971

addition, his comments about "the establishment in North America

7972

of a truly libertarian land system" would be one the Individualist

7973

Anarchists would have seriously disagreed with! [Ibid.]

7974

7975

Thus state action, in restricting free access to the land, ensured that

7976

workers were dependent on wage labour. In addition, the "transformation

7977

of social property relations in northern agriculture set the stage for

7978

the 'agricultural revolution' of the 1840s and 1850s . . . [R]ising

7979

debts and taxes forced midwestern family farmers to compete as

7980

commodity producers in order to maintain their land-holding . . .

7981

The transformation . . . was the central precondition for the

7982

development of industrial capitalism in the United States."

7983

[Charlie Post, Ibid., p. 226]

7984

7985

In addition to seizing the land and distributing it in such a way

7986

as to benefit capitalist industry, the "government played its part

7987

in helping the bankers and hurting the farmers; it kept the amount

7988

of money - based in the gold supply - steady while the population

7989

rose, so there was less and less money in circulation. The farmer

7990

had to pay off his debts in dollars that were harder to get. The

7991

bankers, getting loans back, were getting dollars worth more than

7992

when they loaned them out - a kind of interest on top of interest.

7993

That was why . . . farmers' movements [like the Individualist

7994

Anarchists, we must add] . . . [talked about] putting more money

7995

in circulation." [Howard Zinn, Op. Cit., p. 278]

7996

7997

Overall, therefore, state action ensured the transformation of

7998

America from a society of independent workers to a capitalist one.

7999

By creating and enforcing the "land monopoly" (of which state

8000

ownership of unoccupied land and its enforcement of landlord

8001

rights were the most important) the state ensured that the

8002

balance of class forces tipped in favour of the capitalist

8003

class. By removing the option of farming your own land, the

8004

US government created its own form of enclosure and the creation

8005

of a landless workforce with little option but to sell its

8006

liberty on the "free market". This, combined with protectionism,

8007

ensured the transformation of American society from a pre-capitalist

8008

one into a capitalist one. They was nothing "natural" about it.

8009

8010

Little wonder the Individualist Anarchist J.K. Ingalls attacked

8011

the "land monopoly" in the following words:

8012

8013

"The earth, with its vast resources of mineral wealth, its spontaneous

8014

productions and its fertile soil, the free gift of God and the common

8015

patrimony of mankind, has for long centuries been held in the grasp of

8016

one set of oppressors by right of conquest or right of discovery; and

8017

it is now held by another, through the right of purchase from them.

8018

All of man's natural possessions . . . have been claimed as property;

8019

nor has man himself escaped the insatiate jaws of greed. The invasion

8020

of his rights and possessions has resulted . . . in clothing property

8021

with a power to accumulate an income." [quoted by James Martin, _Men

8022

Against the State_, p. 142]

8023

8024

8.6 How did working people view the rise of capitalism?

8025

8026

The best example of how hated capitalism was can be seen by the rise

8027

and spread of the socialist movement, in all its many forms, across the

8028

world. It is no coincidence that the development of capitalism also saw

8029

the rise of socialist theories. However, in order to fully understand how

8030

different capitalism was from previous economic systems, we will consider

8031

early capitalism in the US, which for many "Libertarians" is *the* example

8032

of the "capitalism-equals-freedom" argument.

8033

8034

Early America was pervaded by artisan production -- individual ownership

8035

of the means of production. Unlike capitalism, this system is *not*

8036

marked by the separation of the worker from the means of life. Most

8037

people did not have to work for another, and so did not. As Jeremy

8038

Brecher notes, in 1831 the "great majority of Americans were farmers

8039

working their own land, primarily for their own needs. Most of the rest

8040

were self-employed artisans, merchants, traders, and professionals.

8041

Other classes - employees and industrialists in the North, slaves and

8042

planters in the South - were relatively small. The great majority of

8043

Americans were independent and free from anybody's command." [_Strike!_,

8044

p. xxi] These conditions created the high cost of combined (wage)

8045

labour which ensured the practice of slavery existed.

8046

8047

However, toward the middle of the 19th century the economy began to

8048

change. Capitalism began to be imported into American society as the

8049

infrastructure was improved, which allowed markets for manufactured

8050

goods to grow. Soon, due to (state-supported) capitalist competition,

8051

artisan production was replaced by wage labour. Thus "evolved" modern

8052

capitalism. Many workers understood, resented, and opposed their

8053

increasing subjugation to their employers ("the masters", to use Adam

8054

Smith's expression), which could not be reconciled with the principles

8055

of freedom and economic independence that had marked American life and

8056

sunk deeply into mass consciousness during the days of the early economy.

8057

In 1854, for example, a group of skilled piano makers wrote that "the day

8058

is far distant when they [wage earners] will so far forget what is due to

8059

manhood as to glory in a system forced upon them by their necessity and in

8060

opposition to their feelings of independence and self-respect. May the

8061

piano trade be spared such exhibitions of the degrading power of the day

8062

[wage] system." [quoted by Brecher and Costello, _Common Sense for Hard

8063

Times_, p. 26]

8064

8065

Clearly the working class did not consider working for a daily wage, in

8066

contrast to working for themselves and selling their own product, to be

8067

a step forward for liberty or individual dignity. The difference between

8068

selling the product of one's labour and selling one's labour (i.e.

8069

oneself) was seen and condemned ("[w]hen the producer . . . sold his

8070

product, he retained himself. But when he came to sell his labour, he

8071

sold himself . . . the extension [of wage labour] to the skilled

8072

worker was regarded by him as a symbol of a deeper change" [Norman

8073

Ware, _The Industrial Worker, 1840-1860_, p. xiv]). Indeed, one group

8074

of workers argued that they were "slaves in the strictest sense of

8075

the word" as they had "to toil from the rising of the sun to the going

8076

down of the same for our masters - aye, masters, and for our daily

8077

bread" [Quoted by Ware, Op. Cit., p. 42] and another argued that "the

8078

factory system contains in itself the elements of slavery, we think

8079

no sound reasoning can deny, and everyday continues to add power to

8080

its incorporate sovereignty, while the sovereignty of the working

8081

people decreases in the same degree." [quoted by Brecher and Costello,

8082

Op. Cit., p. 29]

8083

8084

Almost as soon as there were wage workers, there were strikes, machine

8085

breaking, riots, unions and many other forms of resistance. John Zerzan's

8086

argument that there was a "relentless assault on the worker's historical

8087

rights to free time, self-education, craftsmanship, and play was at

8088

the heart of the rise of the factory system" is extremely accurate

8089

[_Elements of Refusal_, p. 105]. And it was an assault that workers

8090

resisted with all their might. In response to being subjected to the

8091

"law of value," workers rebelled and tried to organise themselves to

8092

fight the powers that be and to replace the system with a co-operative

8093

one. As the printer's union argued, "[we] regard such an organisation

8094

[a union] not only as an agent of immediate relief, but also as an

8095

essential to the ultimate destruction of those unnatural relations at

8096

present subsisting between the interests of the employing and the

8097

employed classes. . . .[W]hen labour determines to sell itself no

8098

longer to speculators, but to become its own employer, to own and

8099

enjoy itself and the fruit thereof, the necessity for scales of

8100

prices will have passed away and labour will be forever rescued

8101

from the control of the capitalist." [quoted by Brecher and Costello,

8102

Op. Cit., pp. 27-28]

8103

8104

Little wonder, then, why wage labourers considered capitalism as a

8105

form of "slavery" and why the term "wage slavery" became so popular

8106

in the anarchist movement. It was just reflecting the feelings of those

8107

who experienced the wages system at first hand and joined the socialist

8108

and anarchist movements. As labour historian Norman Ware notes, the

8109

"term 'wage slave' had a much better standing in the forties [of the

8110

19th century] than it has today. It was not then regarded as an empty

8111

shibboleth of the soap-box orator. This would suggest that it has

8112

suffered only the normal degradation of language, has become a *cliche*,

8113

not that it is a grossly misleading characterisation." [Op. Cit., p. xvf]

8114

8115

These responses of workers to the experience of wage labour is important

8116

to show that capitalism is by no means "natural." The fact is the first

8117

generation of workers tried to avoid wage labour is at all possible as

8118

they hated the restrictions of freedom it imposed upon them. They were

8119

perfectly aware that wage labour was wage slavery -- that they were

8120

decidedly *unfree* during working hours and subjected to the will of

8121

another. While many working people now are accustomed to wage labour

8122

(while often hating their job) the actual process of resistance to

8123

the development of capitalism indicates well its inherently authoritarian

8124

nature. Only once other options were closed off and capitalists given

8125

an edge in the "free" market by state action did people accept and

8126

become accustomed to wage labour.

8127

8128

Opposition to wage labour and factory fascism was/is widespread and seems

8129

to occur wherever it is encountered. "Research has shown", summarises

8130

William Lazonick, "that the 'free-born Englishman' of the eighteenth

8131

century - even those who, by force of circumstance, had to submit to

8132

agricultural wage labour - tenaciously resisted entry into the

8133

capitalist workshop." [_Business Organisation and the Myth of the

8134

Market Economy_, p. 37] British workers shared the dislike of wage

8135

labour of their American cousins. A "Member of the Builders' Union"

8136

in the 1830s argued that the trade unions "will not only strike

8137

for less work, and more wages, but will ultimately *abolish wages,*

8138

become their own masters and work for each other; labour and capital

8139

will no longer be separate but will be indissolubly joined together

8140

in the hands of workmen and work-women." [quoted by Geoffrey Ostergaard,

8141

_The Tradition of Workers' Control_, p. 133] This is unsurprising,

8142

for as Ostergaard notes, "the workers then, who had not been swallowed

8143

up whole by the industrial revolution, could make critical comparisons

8144

between the factory system and what preceded it." [Op. Cit., p. 134]

8145

While wage slavery may seem "natural" today, the first generation of

8146

wage labourers saw the transformation of the social relationships they

8147

experienced in work, from a situation in which they controlled their

8148

own work (and so themselves) to one in which *others* controlled them,

8149

and they did not like it. However, while many modern workers instinctively

8150

hate wage labour and having bosses, without the awareness of some other

8151

method of working, many put up with it as "inevitable." The first

8152

generation of wage labourers had the awareness of something else

8153

(although, of course, a flawed something else) and this gave then

8154

a deep insight into the nature of capitalism and produced a deeply

8155

radical response to it and its authoritarian structures.

8156

8157

Far from being a "natural" development, then, capitalism was imposed on

8158

a society of free and independent people by state action. Those workers

8159

alive at the time viewed it as "unnatural relations" and organised to

8160

overcome it. These feelings and hopes still exist, and will continue to

8161

exist until such time as we organise and "abolish the wage system" (to

8162

quote the IWW preamble) and the state that supports it.

8163

8164

8.7 Why is the history of capitalism important?

8165

8166

Simply because it provides us with an understanding of whether that system

8167

is "natural" and whether it can be considered as just and free. If the

8168

system was created by violence, state action and other unjust means then

8169

the apparent "freedom" which we currently face within it is a fraud, a

8170

fraud masking unnecessary and harmful relations of domination, oppression

8171

and exploitation. Moreover, by seeing how capitalist relationships were

8172

viewed by the first generation of wage slaves reminds us that just because

8173

many people have adjusted to this regime and consider it as normal (or

8174

even natural) it is nothing of the kind.

8175

8176

Murray Rothbard is well aware of the importance of history. He considered

8177

the "moral indignation" of socialism arises from the argument "that the

8178

capitalists have stolen the rightful property of the workers, and therefore

8179

that existing titles to accumulated capital are unjust." He argues that

8180

given "this hypothesis, the remainder of the impetus for both Marxism and

8181

anarchosyndicalism follow quote logically." [_The Ethics of Liberty_,

8182

p. 52]

8183

8184

So some right-libertarians are aware that the current property owners

8185

have benefited extensively from violence and state action in the past.

8186

Murray Rothbard argues (in _The Ethics of Liberty_, p. 57) that if the

8187

just owners cannot be found for a property, then the property simply

8188

becomes again unowned and will belong to the first person to appropriate

8189

and utilise it. If the current owners are not the actual criminals then

8190

there is no reason at all to dispossess them of their property; if the

8191

just owners cannot be found then they may keep the property as the

8192

first people to use it (of course, those who own capital and those who

8193

use it are usually different people, but we will ignore this obvious

8194

point).

8195

8196

Thus, since all original owners and the originally dispossessed are long

8197

dead nearly all current title owners are in just possession of their

8198

property except for recently stolen property. The principle is simple,

8199

dispossess the criminals, restore property to the dispossessed if they

8200

can be found otherwise leave titles where they are (as Native American

8201

tribes owned the land *collectively* this could have an interesting effect

8202

on such a policy in the USA. Obviously tribes that were wiped out need

8203

not apply, but would such right-libertarian policy recognise such

8204

collective, non-capitalist ownership claims? We doubt it, but we could

8205

be wrong -- the Libertarian Party Manifesto states that their "just"

8206

property rights will be restored. And who defines "just"? And given

8207

that unclaimed federal land will be given to Native Americans, its

8208

seems pretty likely that the *original* land will be left alone).

8209

8210

Of course, that this instantly gives an advantage to the wealthy on the

8211

new "pure" market is not mentioned. The large corporations that, via

8212

state protection and support, built their empires and industrial base

8213

will still be in an excellent position to continue to dominate the

8214

market. Wealthy land owners, benefiting from the effects of state

8215

taxation and rents caused by the "land monopoly" on farmstead failures,

8216

will keep their property. The rich will have a great initial advantage

8217

and this may be more than enough to maintain them in there place. After

8218

all, exchanges between worker and owner tend to reinforce existing

8219

inequalities, *not* reduce them (and as the owners can move their

8220

capital elsewhere or import new, lower waged, workers from across the

8221

world, its likely to stay that way).

8222

8223

So Rothbard's "solution" to the problem of past force seems to be

8224

(essentially) a justification of existing property titles and not

8225

a serious attempt to understand or correct past initiations of force

8226

that have shaped society into a capitalist one and still shape it today.

8227

The end result of his theory is to leave things pretty much as they are,

8228

for the past criminals are dead and so are their victims.

8229

8230

However, what Rothbard fails to note is that the *results* of this state

8231

action and coercion are still with us. He totally fails to consider

8232

that the theft of productive wealth has a greater impact on society

8233

than the theft itself. The theft of *productive* wealth shapes

8234

society in so many ways that *all* suffer from it (including current

8235

generations). This (the externalities generated by theft) cannot be

8236

easily undone by individualistic "solutions".

8237

8238

Let us take an example somewhat more useful that the one Rothbard uses

8239

(namely, a stolen watch). A watch cannot really be used to generate

8240

wealth (although if I steal a watch, sell it and buy a winning lottery

8241

ticket, does that mean I can keep the prize after returning the money

8242

value of your watch to you? Without the initial theft, I would not have

8243

won the prize but obviously the prize money far exceeds the amount

8244

stolen. Is the prize money mine?). Let us take a tool of production

8245

rather than a watch.

8246

8247

Let assume a ship sinks and 50 people get washed ashore on an island. One

8248

woman has foresight to take a knife from the ship and falls unconscious

8249

on the beach. A man comes along and steals her knife. When the woman

8250

awakes she cannot remember if she had managed to bring the knife ashore

8251

with her or not. The man maintains that he brought it with him and no one

8252

else saw anything. The survivors decide to split the island equally

8253

between them and work it separately, exchanging goods via barter.

8254

8255

However, the man with the knife has the advantage and soon carves

8256

himself a house and fields from the wilderness. Seeing that they need

8257

the knife and the tools created by the knife to go beyond mere existing,

8258

some of the other survivors hire themselves to the knife owner. Soon

8259

he is running a surplus of goods, including houses and equipment which

8260

he decides to hire out to others. This surplus is then used to tempt

8261

more and more of the other islanders to work for him, exchanging their

8262

land in return for the goods he provides. Soon he owns the whole island

8263

and never has to work again. His hut is well stocked and extremely

8264

luxurious. His workers face the option of following his orders or

8265

being fired (i.e. expelled from the island and so back into the water

8266

and certain death). Later, he dies and leaves his knife to his son.

8267

The woman whose knife it originally was had died long before, childless.

8268

8269

Note that the theft did not involve taking any land. All had equal access

8270

to it. It was the initial theft of the knife which provided the man with

8271

market power, an edge which allowed him to offer the others a choice

8272

between working by themselves or working for him. By working for him

8273

they did "benefit" in terms of increased material wealth (and also

8274

made the thief better off) but the accumulate impact of unequal

8275

exchanges turned them into the effective slaves of the thief.

8276

8277

Now, would it *really* be enough to turn the knife over to the whoever

8278

happened to be using it once the theft was discovered (perhaps the

8279

thief made a death-bed confession). Even if the woman who had originally

8280

taken it from the ship been alive, would the return of the knife *really*

8281

make up for the years of work the survivors had put in enriching the

8282

the thief or the "voluntary exchanges" which had resulted in the thief

8283

owning all the island? The equipment people use, the houses they life

8284

in and the food they eat are all the product of many hours of collective

8285

work. Does this mean that the transformation of nature which the knife

8286

allowed remain in the hands of the descendants of the thief or become

8287

the collective property of all? Would dividing it equally between all

8288

be fair? Not everyone worked equally hard to produce it. So we have a

8289

problem -- the result of the initial theft is far greater than the

8290

theft considered in isolation due to the productive nature of what was

8291

stolen.

8292

8293

In other words, what Rothbard ignores in his attempt to undermine

8294

anarchist use of history is that when the property stolen is of a

8295

productive nature, the accumulative effect of its use is such as to

8296

affect all of society. Productive assets produce *new* property, *new*

8297

values, create a *new* balance of class forces, *new* income and wealth

8298

inequalities and so on. This is because of the *dynamic* nature of

8299

production and human life. When the theft is such that it creates

8300

accumulative effects after the initial act, it is hardly enough to say

8301

that it does not really matter any more. If a nobleman invests in a

8302

capitalist firm with the tribute he extracted from his peasants, then

8303

(once the firm starts doing well) sells the land to the peasants and

8304

uses that money to expand his capitalist holdings, does that *really*

8305

make everything all right? Does not the crime transmit with the cash?

8306

After all, the factory would not exist without the prior exploitation

8307

of the peasants.

8308

8309

In the case of actually existing capitalism, born as it was of extensive

8310

coercive acts, the resultant of these acts have come to shape the *whole*

8311

society. For example, the theft of common land (plus the enforcement of

8312

property rights -- the land monopoly -- to vast estates owned by the

8313

aristocracy) ensured that working people had no option to sell their

8314

labour to the capitalists (rural or urban). The terms of these contracts

8315

reflected the weak position of the workers and so capitalists extracted

8316

surplus value from workers and used it to consolidate their market

8317

position and economic power. Similarly, the effect of mercantilist

8318

policies (and protectionism) was to enrich the capitalists at the

8319

expense of workers and allow them to build industrial empires.

8320

8321

The accumulative effect of these acts of violation of a "free" market

8322

was to create a class society wherein most people "consent" to be

8323

wage slaves and enrich the few. While those who suffered the impositions

8324

are long gone and the results of the specific acts have multiplied and

8325

magnified well beyond their initial form. And we are still living with

8326

them. In other words, the initial acts of coercion have been transmitted

8327

and transformed by collective activity (wage labour) into society-wide

8328

affects.

8329

8330

Rothbard argues in the situation where the descendants (or others) of

8331

those who initially tilled the soil and their aggressors ("or those who

8332

purchased their claims") still extract "tribute from the modern tillers"

8333

that this is a case of "*continuing* aggression against the true owners."

8334

This means that "the land titles should be transferred to the peasants,

8335

without compensation to the monopoly landlords." [Op. Cit., p. 65] But

8336

what he fails to note is that the extracted "tribute" could have been

8337

used to invest in industry and transform society. Why ignore what the

8338

"tribute" has been used for? Does stolen property not remain stolen

8339

property after it has been transferred to another? And if the stolen

8340

property is used to create a society in which one class has to sell

8341

their liberty to another, then surely any surplus coming from those

8342

exchanges are also stolen (as it was generated directly and indirectly

8343

by the theft).

8344

8345

Yes, anarchist agree with Rothbard -- peasants should take the land they

8346

use but which is owned by another. But this logic can equally be applied to

8347

capitalism. Workers are still living with the effects of past initiations

8348

of force and capitalists still extract "tribute" from workers due to

8349

the unequal bargaining powers within the labour market that this has

8350

created. The labour market, after all, was created by state action

8351

(directly or indirectly) and is maintained by state action (to protect

8352

property rights and new initiations of force by working people). The

8353

accumulative effects of stealing productive resources as been to

8354

increase the economic power of one class compared to another. As the

8355

victims of these past abuses are long gone and attempts to find their

8356

descendants meaningless (because of the generalised effects the

8357

thefts in question), anarchists feel we are justified in demanding

8358

the "expropriation of the expropriators".

8359

8360

Due to Rothbard's failure to understand the dynamic and generalising

8361

effects that result from the theft of productive resources (i.e. externalities

8362

that occur from coercion of one person against a specific set of others) and

8363

the creation of a labour market, his attempt to refute anarchist analysis

8364

of the history of "actually existing capitalism" also fails. Society is

8365

the product of collective activity and should belong to us all (although

8366

whether and how we divide it up is another question).

8367

8368

9 Is Medieval Iceland an example of "anarcho"-capitalism working in

8369

practice?

8370

8371

Ironically, medieval Iceland is a good example of why "anarcho"-capitalism

8372

will *not* work, degenerating into de facto rule by the rich. It should be

8373

pointed out first that Iceland, nearly 1,000 years ago, was not a capitalistic

8374

system. In fact, like most cultures claimed by "anarcho"-capitalists as

8375

examples of their "utopia," it was a communal, not individualistic, society,

8376

based on artisan production, with extensive communal institutions as well as

8377

individual "ownership" (i.e. use) and a form of social self-administration,

8378

the *thing* -- both local and Iceland-wide -- which can be considered a

8379

"primitive" form of the anarchist communal assembly.

8380

8381

As William Ian Miller points out "[p]eople of a communitarian nature. . .

8382

have reason to be attracted [to Medieval Iceland]. . . the limited role

8383

of lordship, the active participation of large numbers of free people . . .

8384

in decision making within and without the homestead. The economy barely

8385

knew the existence of markets. Social relations preceded economic

8386

relations. The nexus of household, kin, Thing, even enmity, more than the

8387

nexus of cash, bound people to each other. The lack of extensive economic

8388

differentiation supported a weakly differentiated class system . . . [and

8389

material] deprivations were more evenly distributed than they would be

8390

once state institutions also had to be maintained." [_Bloodtaking and

8391

Peacemaking: Feud, Law and Society in Saga Iceland_, p. 306]

8392

8393

At this time Iceland "remained entirely rural. There were no towns, not

8394

even villages, and early Iceland participated only marginally in the active

8395

trade of Viking Age Scandinavia." There was a "diminished level of

8396

stratification, which emerged from the first phase of social and economic

8397

development, lent an appearance of egalitarianism - social stratification

8398

was restrained and political hierarchy limited." [Jesse Byock, _Viking Age

8399

Iceland_, p. 2] That such a society could be classed as "capitalist" or

8400

even considered a model for an advanced industrial society is staggering.

8401

8402

Kropotkin in _Mutual Aid_ indicates that Norse society, from which the

8403

settlers in Iceland came, had various "mutual aid" institutions, including

8404

communal land ownership (based around what he called the "village community")

8405

and the *thing* (see also Kropotkin's _The State: Its Historic Role_ for a

8406

discussion of the "village community"). It is reasonable to think that

8407

the first settlers in Iceland would have brought such institutions with

8408

them and Iceland did indeed have its equivalent of the commune or "village

8409

community," the *Hreppar*, which developed early in the country's history.

8410

Like the early local assemblies, it is not much discussed in the Sagas but

8411

is mentioned in the law book, the Gr g s, and was composed of a minimum of

8412

twenty farms and had a five member commission. The Hreppar was self-governing

8413

and, among other things, was responsible for seeing that orphans and the

8414

poor within the area were fed and housed. The Hreppar also served as a

8415

property insurance agency and assisted in case of fire and losses due to

8416

diseased livestock.

8417

8418

In addition, as in most pre-capitalist societies, there were "commons",

8419

common land available for use by all. During the summer, "common lands

8420

and pastures in the highlands, often called *almenning*, were used by

8421

the region's farmers for grazing." This increased the independence of

8422

the population from the wealthy as these "public lands offered opportunities

8423

for enterprising individuals to increase their store of provisions and to

8424

find saleable merchandise." [Jesse Byock, Op. Cit., p. 47 and p. 48]

8425

8426

Thus Icelandic society had a network of solidarity, based upon communal

8427

life:

8428

8429

"The status of farmers as free agents was reinforced by the presence of

8430

communal units called *hreppar* (sing. *hreppr*) . . . these [were]

8431

geographically defined associations of landowners. . . the *hreppr*

8432

were self-governing . . . .[and] guided by a five-member steering

8433

committee . . . As early as the 900s, the whole country seems to have

8434

been divided into *hreppar* . . . *Hreppar* provided a blanket of

8435

local security, allowing the landowning farmers a measure of

8436

independence to participate in the choices of political life . . .

8437

8438

"Through copoperation among their members, *hreppar* organised and

8439

controlled summer grazing lands, organised communal labour, and

8440

provided an immediate local forum for settling disputes. Crucially,

8441

they provided fire and livestock insurance for local farmers. . .

8442

[They also] saw to the feeding and housing of local orphans, and

8443

administered poor relief to people who were recognised as inhabitants

8444

of their area. People who could not provide for themselves were

8445

assigned to member farms, which took turns in providing for them."

8446

[Byock, Op. Cit., pp. 137-8]

8447

8448

In practice this meant that "each commune was a mutual insurance

8449

company, or a miniature welfare state. And membership in the commune

8450

was not voluntary. Each farmer had to belong to the commune in which

8451

his farm was located and to contribute to its needs." [Gissurarson,

8452

quoted by Birgit T. Runolfsson Solvason, _Ordered Anarchy, State and

8453

Rent-Seeking: The Icelandic Commonwealth, 930-1262_] The Icelandic

8454

Commonwealth did not allow farmers *not* to join its communes and

8455

"[o]nce attached to the local *hreppr*, a farm's affliation could

8456

not be changed." However, they did play a key role in keeping the

8457

society free as the *hreppr* "was essentially non-political and

8458

addressed subsistence and economic security needs. Its presence

8459

freed farmers from depending on an overclass to provide comparable

8460

services or corresponding security measures." [Byock, Op. Cit., p. 138]

8461

8462

Therefore, the Icelandic Commonwealth can hardly be claimed in any

8463

significant way as an example of "anarcho"-capitalism in practice. This

8464

can also be seen from the early economy, where prices were subject to popular

8465

judgement at the *skuldaping* ("payment-thing") *not* supply and demand.

8466

[Kirsten Hastrup, _Culture and History in Medieval Iceland_, p. 125]

8467

Indeed, with its communal price setting system in local assemblies, the

8468

early Icelandic commonwealth was more similar to Guild Socialism (which

8469

was based upon guild's negotiating "just prices" for goods and services)

8470

than capitalism. Therefore Miller correctly argues that it would be wrong

8471

to impose capitalist ideas and assumptions onto Icelandic society:

8472

8473

"Inevitably the attempt was made to add early Iceland to the number of

8474

regions that socialised people in nuclear families within simple

8475

households. . . what the sources tell us about the shape of Icelandic

8476

householding must compel a different conclusion." [Op. Cit., p. 112]

8477

8478

In other words, Kropotkin's analysis of communal society is far closer

8479

to the reality of Medieval Iceland than "anarcho"-capitalist attempts

8480

to turn it into a some kind of capitalist utopia.

8481

8482

However, the communal nature of Icelandic society also co-existed (as

8483

in most such cultures) with hierarchical institutions, including some with

8484

capitalistic elements, namely private property and "private states" around

8485

the local *godar.* The godar were local chiefs who also took the role of

8486

religious leaders. As the _Encyclopaedia Britannica_ explains, "a kind of

8487

local government was evolved [in Iceland] by which the people of a

8488

district who had most dealings together formed groups under the leadership

8489

of the most important or influential man in the district" (the godi).

8490

The godi "acted as judge and mediator" and "took a lead in communal

8491

activities" such as building places of worship. These "local assemblies.

8492

. . are heard of before the establishment of the althing" (the national

8493

thing). This althing led to co-operation between the local assemblies.

8494

8495

Thus Icelandic society had different elements, one based on the local

8496

chiefs and communal organisations. Society was marked by inequalities

8497

as "[a]mong the landed there were differences in wealth and prominence.

8498

Distinct cleavages existed between landowners and landless people and

8499

between free men and slaves." This meant it was "marked by aspects of

8500

statelessness and egalitarianism as well as elements of social hierarchy

8501

. . . Although Iceland was not a democratic system, proto-democratic

8502

tendencies existed." [Byock, Op. Cit., p. 64 and p. 65] The Icelandic

8503

social system was designed to reduce the power of the wealthy by

8504

enhancing communal institutions:

8505

8506

"The society . . . was based on a system of decentralised self-government

8507

. . . The Viking Age settlers began by establishing local things, or

8508

assemblies, which had been the major forum for meetings of freemen

8509

and aristocrats in the old Scandinavian and Germanic social order. . .

8510

They [the Icelanders] excluded overlords with coercive power and

8511

expended the mandate of the assembly to fill the full spectrum of

8512

the interests of the landed free farmers. The changes transformed a

8513

Scandinavian decision-making body that mediated between freemen and

8514

overlords into an Icelandic self-contained governmental system without

8515

overlords. At the core of Icelandic government was the Althing, a

8516

national assembly of freemen." [Byock, Op. Cit., p. 75]

8517

8518

Therefore we see communal self-management in a basic form, *plus*

8519

co-operation between communities as well. These communistic,

8520

mutual-aid features exist in many non-capitalist cultures and are

8521

often essential for ensuring the people's continued freedom within

8522

those cultures (section B.2.5 on why the wealthy undermine these

8523

popular "folk-motes" in favour of centralisation). Usually, the

8524

existence of private property (and so inequality) soon led to the

8525

destruction of communal forms of self-management (with participation

8526

by all male members of the community as in Iceland), which are replaced

8527

by the rule of the rich.

8528

8529

While such developments are a commonplace in most "primitive" cultures,

8530

the Icelandic case has an unusual feature which explains the interest

8531

it provokes in "anarcho"-capitalist circles. This feature was that

8532

individuals could seek protection from any godi. As the _Encyclopaedia

8533

Britannica_ puts it, "the extent of the godord [chieftancy] was not fixed

8534

by territorial boundaries. Those who were dissatisfied with their chief

8535

could attach themselves to another godi. . . As a result rivalry arose

8536

between the godar [chiefs]; as may be seen from the Icelandic Sagas."

8537

This was because, while there were "a central legislature and uniform,

8538

country-wide judicial and legal systems," people would seek the

8539

protection of any godi, providing payment in return. [Byock, Op. Cit.,

8540

p. 2] These godi, in effect, would be subject to "market forces," as

8541

dissatisfied individuals could affiliate themselves to other godi. This

8542

system, however, had an obvious (and fatal) flaw. As the _Encyclopaedia

8543

Britannica_ points out:

8544

8545

"The position of the godi could be bought and sold, as well as inherited;

8546

consequently, with the passing of time, the godord for large areas of the

8547

country became concentrated in the hands of one man or a few men. This was

8548

the principal weakness of the old form of government: it led to a struggle

8549

of power and was the chief reason for the ending of the commonwealth and

8550

for the country's submission to the King of Norway."

8551

8552

It was the existence of these hierarchical elements in Icelandic society

8553

that explain its fall from anarchistic to statist society. As Kropotkin

8554

argued "from chieftainship sprang on the one hand the State and on the

8555

other *private* property." [_Act for Yourselves_, p. 85] Kropotkin's

8556

insight that chieftainship is a transitional system has been confirmed

8557

by anthropologists studying "primitive" societies. They have come to the

8558

conclusion that societies made up of chieftainships or chiefdoms are

8559

not states: "Chiefdoms are neither stateless nor state societies in the

8560

fullest sense of either term: they are on the borderline between the two.

8561

Having emerged out of stateless systems, they give the impression of being

8562

on their way to centralised states and exhibit characteristics of both."

8563

[Y. Cohen quoted by Birgit T. Runolfsson Solvason, Op. Cit.] Since the

8564

Commonwealth was made up of chiefdoms, this explains the contradictory

8565

nature of the society - it was in the process of transition, from anarchy

8566

to statism, from a communal economy to one based on private property.

8567

8568

The *political* transition within Icelandic society went hand in hand with

8569

an *economic* transition (both tendencies being mutually reinforcing).

8570

Initially, when Iceland was settled, large-scale farming based on extended

8571

households with kinsmen was the dominant economic mode. This semi-communal

8572

mode of production changed as the land was divided up (mostly through

8573

inheritance claims) between the 10th and 11th centuries. This new economic

8574

system based upon individual *possession* and artisan production was then

8575

slowly displaced by tenant farming, in which the farmer worked for a

8576

landlord, starting in the late 11th century. This economic system (based

8577

on tenant farming, i.e. capitalistic production) ensured that

8578

"great variants of property and power emerged." [Kirsten Hastrup, _Culture

8579

and History in Medieval Iceland_, pp. 172-173]

8580

8581

So significant changes in society started to occur in the eleventh century,

8582

as "slavery all but ceased. Tenant farming . . . took [its] place." Iceland

8583

was moving from an economy based on *possession* to one based on *private

8584

property* and so "the renting of land was a widely established practice by

8585

the late eleventh century . . . the status of the *godar* must have been

8586

connected with landownership and rents." This lead to increasing oligarchy

8587

and so the mid- to late-twelfth century was "characterised by the appearance

8588

of a new elite, the big chieftains who are called storgodar . . . [who]

8589

struggled from the 1220s to the 1260s to win what had earlier been

8590

unobtainable for Icelandic leaders, the prize of overlordship or

8591

centralised executive authority." [Byock, Op. Cit., p. 269 and pp. 3-4]

8592

8593

During this evolution in ownership patterns and the concentration of wealth

8594

and power into the hands of a few, we should note that the godi's and wealthy

8595

landowners' attitude to profit making also changed, with market values

8596

starting to replace those associated with honour, kin, and so on. Social

8597

relations became replaced by economic relations and the nexus of household,

8598

kin and Thing was replaced by the nexus of cash and profit. The rise of

8599

capitalistic social relationships in production and values within society

8600

was also reflected in exchange, with the local marketplace, with its

8601

pricing "subject to popular judgement" being "subsumed under central

8602

markets." [Hastrup, Op. Cit., p. 225]

8603

8604

With a form of wage labour (tenant farming) being dominant within society,

8605

it is not surprising that great differences in wealth started to appear.

8606

Also, as protection did not come free, it is not surprising that a godi

8607

tended to become rich also (in Kropotkin's words, "the individual

8608

accumulation of wealth and power"). Powerful godi would be useful for

8609

wealthy landowners when disputes over land and rent appeared, and wealthy

8610

landowners would be useful for a godi looking for income. Concentrations

8611

of wealth, in other words, produce concentrations of social and political

8612

power (and vice versa) -- "power always follows wealth." [Kropotkin,

8613

_Mutual Aid_, p. 131]

8614

8615

The transformation of *possession* into *property* and the resulting rise

8616

of hired labour was a *key* element in the accumulation of wealth and power,

8617

and the corresponding decline in liberty among the farmers. Moreover, with

8618

hired labour springs dependency -- the worker is now dependent on good

8619

relations with their landlord in order to have access to the land they need.

8620

With such reductions in the independence of part of Icelandic society, the

8621

undermining of self-management in the various Things was also likely as

8622

labourers could not vote freely as they could be subject to sanctions from

8623

their landlord for voting the "wrong" way ("The courts were less likely to

8624

base judgements on the evidence than to adjust decisions to satisfy the

8625

honour and resources of powerful individuals." [Byock, Op. Cit., p. 185]).

8626

Thus hierarchy within the economy would spread into the rest of society,

8627

and in particular its social institutions, reinforcing the effects of the

8628

accumulation of wealth and power.

8629

8630

The resulting classification of Icelandic society played a key role in its

8631

move from relative equality and anarchy to a class society and statism.

8632

As Millar points out:

8633

8634

"as long as the social organisation of the economy did not allow for

8635

people to maintain retinues, the basic egalitarian assumptions of the

8636

honour system. . . were reflected reasonably well in reality. . . the

8637

mentality of hierarchy never fully extricated itself from the egalitarian

8638

ethos of a frontier society created and recreated by juridically equal

8639

farmers. Much of the egalitarian ethic maintained itself even though it

8640

accorded less and less with economic realities. . . by the end of the

8641

commonwealth period certain assumptions about class privilege and

8642

expectations of deference were already well enough established to have

8643

become part of the lexicon of self-congratulation and self-justification."

8644

[Op. Cit., pp. 33-4]

8645

8646

This process in turn accelerated the destruction of communal life and the

8647

emergence of statism, focused around the godord. In effect, the godi and

8648

wealthy farmers became rulers of the country. Political changes simply

8649

reflected economic changes from a communalistic, anarchistic society to

8650

a statist, propertarian one. Ironically, this process was a natural

8651

aspect of the system of competing chiefs recommended by

8652

"anarcho"-capitalists:

8653

8654

"In the twelfth and thirteenth centuries Icelandic society experienced

8655

changes in the balance of power. As part of the evolution to a more

8656

stratified social order, the number of chieftains diminished and the power

8657

of the remaining leaders grew. By the thirteenth century six large families

8658

had come to monopolise the control and ownership of many of the original

8659

chieftaincies." [Byock, Op. Cit., p. 341]

8660

8661

These families were called *storgodar* and they "gained control over whole

8662

regions." This process was not imposed, as "the rise in social complexity

8663

was evolutionary rather than revolutionary . . . they simply moved up the

8664

ladder." This political change reflected economic processes, for "[a]t

8665

the same time other social transformations were at work. In conjunction

8666

with the development of the *storgadar* elite, the most successful among

8667

the *baendr* [farmers] also moved up a rung on the social ladder, being

8668

'big farmers' or *Storbaendr*" [Op. Cit., p. 342] Unsurprisingly, it was

8669

the rich farmers who initiated the final step towards normal statism

8670

and by the 1250s the *storbaendr* and their followers had grown weary

8671

of the *storgodar* and their quarrels. In the end they accepted the

8672

King of Norway's offer to become part if his kingdom.

8673

8674

The obvious conclusion is that as long as Iceland was not capitalistic,

8675

it was anarchic and as it became more capitalistic, it became more statist.

8676

8677

This process, wherein the concentration of wealth leads to the destruction

8678

of communal life and so the anarchistic aspects of a given society, can be

8679

seen elsewhere, for example, in the history of the United States after the

8680

Revolution or in the degeneration of the free cities of Medieval Europe.

8681

Peter Kropotkin, in his classic work _Mutual Aid_, documents this process

8682

in some detail, in many cultures and time periods. However, that this

8683

process occurred in a society which is used by "anarcho"-capitalists as an

8684

example of their system in action reinforces the anarchist analysis of the

8685

statist nature of "anarcho"-capitalism and the deep flaws in its theory,

8686

as discussed in section 6.

8687

8688

As Miller argues, "[i]t is not the have-nots, after all, who invented the

8689

state. The first steps toward state formation in Iceland were made by

8690

churchmen. . . and by the big men content with imitating Norwegian

8691

royal style. Early state formation, I would guess, tended to involve

8692

redistributions, not from rich to poor, but from poor to rich, from

8693

weak to strong." [Op. Cit., p. 306]

8694

8695

The "anarcho"-capitalist argument that Iceland was an example of

8696

their ideology working in practice is derived from the work of

8697

David Friedman. Friedman is less gun-ho than many of his followers,

8698

arguing in _The Machinery of Freedom_, that Iceland only had some

8699

features of an "anarcho"-capitalist society and these provide some

8700

evidence in support of his ideology. How a pre-capitalist society

8701

can provide any evidence to support an ideology aimed at an

8702

advanced industrial and urban economy is hard to say as the

8703

institutions of that society cannot be artificially separated

8704

from its social base. Ironically, though, it does present some

8705

evidence against "anarcho"-capitalism precisely because of the

8706

rise of capitalistic elements within it.

8707

8708

David Friedman is aware of how the Icelandic Republic degenerated and its

8709

causes. He states in a footnote in his 1979 essay "Private Creation and

8710

Enforcement of Law: A Historical Case" that the "question of why the system

8711

eventually broke down is both interesting and difficult. I believe that two

8712

of the proximate causes were increased concentration of wealth, and hence

8713

power, and the introduction into Iceland of a foreign ideology -- kingship.

8714

The former meant that in many areas all or most of the godord were held by

8715

one family and the latter that by the end of the Sturlung period the

8716

chieftains were no longer fighting over the traditional quarrels of who

8717

owed what to whom, but over who should eventually rule Iceland. The

8718

ultimate reasons for those changes are beyond the scope of this paper."

8719

8720

However, from an anarchist point of view, the "foreign" ideology of kingship

8721

would be the *product* of changing socio-economic conditions that were

8722

expressed in the increasing concentration of wealth and not its cause.

8723

After all, the settlers of Iceland were well aware of the "ideology" of

8724

kingship for the 300 years during which the Republic existed. As Byock

8725

notes, Iceland "inherited the tradition and the vocabulary of statehood

8726

from its European origins . . . On the mainland, kings were enlarging their

8727

authority at the expense of the traditional rights of free farmers. The

8728

emigrants to Iceland were well aware of this process . . . available

8729

evidence does suggest that the early Icelanders knew quite well what

8730

they did not want. In particular they were collectively opposed to the

8731

centralising aspects of a state." [Op. Cit., p. 64-6] Unless some kind

8732

of collective and cultural amnesia occurred, the notion of a "foreign

8733

ideology" causing the degeneration is hard to accept. Moreover, only

8734

the concentration of wealth allowed would-be Kings the opportunity to

8735

develop and act and the creation of boss-worker social relationships on

8736

the land made the poor subject to, and familiar with, the concept of

8737

authority. Such familiarity would spread into all aspects of life and,

8738

combined with the existence of "prosperous" (and so powerful) godi to

8739

enforce the appropriate servile responses, ensured the end of the relative

8740

equality that fostered Iceland's anarchistic tendencies in the first place.

8741

8742

In addition, as private property is a monopoly of rulership over a given

8743

area, the conflict between chieftains for power was, at its most basic, a

8744

conflict of who would *own* Iceland, and so rule it. The attempt to ignore

8745

the facts that private property creates rulership (i.e. a monopoly of

8746

government over a given area) and that monarchies are privately owned

8747

states does Friedman's case no good. In other words, the system of private

8748

property has a built in tendency to produce both the ideology and fact of

8749

Kingship - the power structures implied by Kingship are reflected in the

8750

social relations which are produced by private property.

8751

8752

Friedman is also aware that an "objection [to his system] is that the rich

8753

(or powerful) could commit crimes with impunity, since nobody would be able

8754

to enforce judgement against them. Where power is sufficiently concentrated

8755

this might be true; this was one of the problems which led to the eventual

8756

breakdown of the Icelandic legal system in the thirteenth century. But so

8757

long as power was reasonably dispersed, as it seem to have been for the

8758

first two centuries after the system was established, this was a less

8759

serious problem." [Op. Cit.]

8760

8761

Which is quite ironic. Firstly, because the first two centuries of Icelandic

8762

society was marked by *non-capitalist* economic relations (communal pricing

8763

and family/individual possession of land). Only when capitalistic social

8764

relationships developed (hired labour and property replacing possession

8765

and market values replacing social ones) in the 12th century did power

8766

become concentrated, leading to the breakdown of the system in the 13th

8767

century. Secondly, because Friedman is claiming that "anarcho"-capitalism

8768

will only work if there is an approximate equality within society! But this

8769

state of affairs is one most "anarcho"-capitalists claim is impossible

8770

and undesirable!

8771

8772

They claim there will *always* be rich and poor. But inequality in wealth

8773

will also become inequality of power. When "actually existing" capitalism

8774

has become more free market the rich have got richer and the poor poorer.

8775

Apparently, according to the "anarcho"-capitalists, in an even "purer"

8776

capitalism this process will be reversed! It is ironic that an ideology

8777

that denounces egalitarianism as a revolt against nature implicitly

8778

requires an egalitarian society in order to work.

8779

8780

In reality, wealth concentration is a fact of life in *any* system based

8781

upon hierarchy and private property. Friedman is aware of the reasons why

8782

"anarcho"-capitalism will become rule by the rich but prefers to believe

8783

that "pure" capitalism will produce an egalitarian society! In the case of

8784

the commonwealth of Iceland this did not happen - the rise in private

8785

property was accompanied by a rise in inequality and this lead to the

8786

breakdown of the Republic into statism.

8787

8788

In short, Medieval Iceland nicely illustrates David Weick's comments (as

8789

quoted in section 6.3) that "when private wealth is uncontrolled, then

8790

a police-judicial complex enjoying a clientele of wealthy corporations

8791

whose motto is self-interest is hardly an innocuous social force controllable

8792

by the possibility of forming or affiliating with competing 'companies.'"

8793

This is to say that "free market" justice soon results in rule by the rich,

8794

and being able to affiliate with "competing" "defence companies" is

8795

insufficient to stop or change that process.

8796

8797

This is simply because any defence-judicial system does not exist in a

8798

social vacuum. The concentration of wealth -- a natural process under

8799

the "free market" (particularly one marked by private property and wage

8800

labour) -- has an impact on the surrounding society. Private property,

8801

i.e. monopolisation of the means of production, allows the monopolists to

8802

become a ruling elite by exploiting, and so accumulating vastly more

8803

wealth than, the workers. This elite then uses its wealth to control the

8804

coercive mechanisms of society (military, police, "private security

8805

forces," etc.), which it employs to protect its monopoly and thus its

8806

ability to accumulate ever more wealth and power. Thus, private property,

8807

far from increasing the freedom of the individual, has always been the

8808

necessary precondition for the rise of the state and rule by the rich.

8809

Medieval Iceland is a classic example of this process at work.

8810

8811

10 Would laissez-faire capitalism be stable?

8812

8813

Unsurprisingly, right-libertarians combine their support for "absolute

8814

property rights" with a whole-hearted support for laissez-faire capitalism.

8815

In such a system (which they maintain, to quote Ayn Rand, is an "unknown

8816

ideal") everything would be private property and there would be few (if

8817

any) restrictions on "voluntary exchanges." "Anarcho"-capitalists are

8818

the most extreme of defenders of pure capitalism, urging that the state

8819

itself be privatised and no voluntary exchange made illegal (for example,

8820

children would be considered the property of their parents and it would

8821

be morally right to turn them into child prostitutes -- the child has

8822

the option of leaving home if they object).

8823

8824

As there have been no example of "pure" capitalism it is difficult to

8825

say whether their claims about are true (for a discussion of a close

8826

approximation see the section 10.3). This section of the FAQ is an

8827

attempt to discover whether such a system would be stable or whether

8828

it would be subject to the usual booms and slumps. Before starting we

8829

should note that there is some disagreement within the right-libertarian

8830

camp itself on this subject (although instead of stability they usually

8831

refer to "equilibrium" -- which is an economics term meaning that all

8832

of a societies resources are fully utilised).

8833

8834

In general terms, most right-Libertarians' reject the concept of

8835

equilibrium as such and instead stress that the economy is inherently

8836

a dynamic (this is a key aspect of the Austrian school of economics).

8837

Such a position is correct, of course, as such noted socialists as

8838

Karl Marx and Michal Kalecki and capitalist economists as Keynes

8839

recognised long ago. There seems to be two main schools of thought

8840

on the nature of disequilibrium. One, inspired by von Mises, maintains

8841

that the actions of the entrepreneur/capitalist results in the market

8842

co-ordinating supply and demand and another, inspired by Joseph

8843

Schumpeter, who question whether markets co-ordinate because

8844

entrepreneurs are constantly innovating and creating new markets,

8845

products and techniques.

8846

8847

Of course both actions happen and we suspect that the differences in

8848

the two approaches are not important. The important thing to remember

8849

is that "anarcho"-capitalists and right-libertarians in general reject

8850

the notion of equilibrium -- but when discussing their utopia they

8851

do not actually indicate this! For example, most "anarcho"-capitalists

8852

will maintain that the existence of government (and/or unions) causes

8853

unemployment by either stopping capitalists investing in new lines

8854

of industry or forcing up the price of labour above its market clearing

8855

level (by, perhaps, restricting immigration, minimum wages, taxing

8856

profits). Thus, we are assured, the worker will be better off in

8857

"pure" capitalism because of the unprecedented demand for labour

8858

it will create. However, full employment of labour is an equilibrium

8859

in economic terms and that, remember, is impossible due to the

8860

dynamic nature of the system. When pressed, they will usually admit

8861

there will be periods of unemployment as the market adjusts or that

8862

full unemployment actually means under a certain percentage of

8863

unemployment. Thus, if you (rightly) reject the notion of equilibrium

8864

you also reject the idea of full employment and so the labour market

8865

becomes a buyers market and labour is at a massive disadvantage.

8866

8867

The right-libertarian case is based upon logical deduction, and the

8868

premises required to show that laissez-faire will be stable are somewhat

8869

incredible. If banks do not set the wrong interest rate, if companies

8870

do not extend too much trade credit, if workers are willing to accept

8871

(real wage related) pay cuts, if workers altruistically do not abuse their

8872

market power in a fully employed society, if interest rates provide

8873

the correct information, if capitalists predict the future relatively

8874

well, if banks and companies do not suffer from isolation paradoxes,

8875

then, perhaps, laissez-faire will be stable.

8876

8877

So, will laissez-faire capitalism be stable? Let us see by analysing

8878

the assumptions of right-libertarianism -- namely that there will be

8879

full employment and that a system of private banks will stop the

8880

business cycle. We will start on the banking system first (in section

8881

10.1) followed by the effects of the labour market on economic stability

8882

(in section 10.2). Then we will indicate, using the example of 19th

8883

century America, that actually existing ("impure") laissez-faire was

8884

very unstable.

8885

8886

Explaining booms and busts by state action plays an ideological convenience

8887

as it exonerates market processes as the source of instability within

8888

capitalism. We hope to indicate in the next two sections why the business

8889

cycle is inherent in the system (see also sections C.7, C.8 and C.9).

8890

8891

10.1 Would privatising banking make capitalism stable?

8892

8893

It is claimed that the existence of the state (or, for minimal statists,

8894

government policy) is the cause of the business cycle (recurring economic

8895

booms and slumps). This is because the government either sets interest

8896

rates too low or expands the money supply (usually by easing credit

8897

restrictions and lending rates, sometimes by just printing fiat money).

8898

This artificially increases investment as capitalists take advantage of

8899

the artificially low interest rates. The real balance between savings and

8900

investment is broken, leading to over-investment, a drop in the

8901

rate of profit and so a slump (which is quite socialist in a way, as

8902

many socialists also see over-investment as the key to understanding

8903

the business cycle, although they obviously attribute the slump to

8904

different causes -- namely the nature of capitalist production, not

8905

that the credit system does not play its part -- see section C.7).

8906

8907

In the words of Austrian Economist W. Duncan Reekie, "[t]he business

8908

cycle is generated by monetary expansion and contraction . . . When

8909

new money is printed it appears as if the supply of savings has

8910

increased. Interest rates fall and businessmen are misled into

8911

borrowing additional founds to finance extra investment activity . . .

8912

This would be of no consequence if it had been the outcome of [genuine

8913

saving] . . . -but the change was government induced. The new money

8914

reaches factor owners in the form of wages, rent and interest . . .

8915

the factor owners will then spend the higher money incomes in their

8916

existing consumption:investment proportions . . . Capital goods

8917

industries will find their expansion has been in error and malinvestments

8918

have been inoccured." [_Markets, Entrepreneurs and Liberty_, pp. 68-9]

8919

8920

In other words, there has been "wasteful mis-investment due to government

8921

interference with the market." [Op. Cit., p. 69] In response to this

8922

(negative) influence in the workings of the market, it is suggested

8923

by right-libertarians that a system of private banks should be used and

8924

that interest rates are set by them, via market forces. In this way an

8925

interest rate that matches the demand and supply for savings will

8926

be reached and the business cycle will be no more. By truly privatising

8927

the credit market, it is hoped by the business cycle will finally stop.

8928

8929

Unsurprisingly, this particular argument has its weak points and in this

8930

section of the FAQ we will try to show exactly why this theory is wrong.

8931

8932

Let us start with Reckie's starting point. He states that the "main problem"

8933

of the slump is "why is there suddenly a '*cluster*' of business errors?

8934

Businessmen and entrepreneurs are market experts (otherwise they would

8935

not survive) and why should they all make mistakes simultaneously?"

8936

[Op. Cit., p. 68] It is this "cluster" of mistakes that the Austrians'

8937

take as evidence that the business cycle comes from outside the workings

8938

of the market (i.e. is exogenous in nature). Reekie argues that an "error

8939

cluster only occurs when all entrepreneurs have received the wrong signals

8940

on potential profitability, and all have received the signals simultaneously

8941

through government interference with the money supply." [Op. Cit., p. 74]

8942

But is this *really* the case?

8943

8944

The simple fact is that groups of (rational) individuals can act in the

8945

same way based on the same information and this can lead to a collective

8946

problem. For example, we do not consider it irrational that everyone in a

8947

building leaves it when the fire alarm goes off and that the flow of

8948

people can cause hold-ups at exits. Neither do we think that its unusual

8949

that traffic jams occur, after all those involved are all trying to get

8950

to work (i.e. they are reacting to the same desire). Now, is it so

8951

strange to think that capitalists who all see the same opportunity for

8952

profit in a specific market decide to invest in it? Or that the aggregate

8953

outcome of these individually rational decisions may be irrational (i.e.

8954

cause a glut in the market)?

8955

8956

In other words, a "cluster" of business failures may come about because

8957

a group of capitalists, acting in isolation, over-invest in a given

8958

market. They react to the same information (namely super profits in

8959

market X), arrange loans, invest and produce commodities to meet demand

8960

in that market. However, the aggregate result of these individually

8961

rational actions is that the aggregate supply far exceeds demand, causing

8962

a slump in that market and, perhaps, business failures. The slump in this

8963

market (and the potential failure of some firms) has an impact on the

8964

companies that supplied them, the companies that are dependent on

8965

their employees wages/demand, the banks that supplied the credit and so

8966

forth. The accumulative impact of this slump (or failures) on the chain of

8967

financial commitments of which they are but one link can be large and,

8968

perhaps, push an economy into general depression. Thus the claim that

8969

it is something external to the system that causes depression is flawed.

8970

8971

It could be claimed the interest rate is the problem, that it does

8972

not accurately reflect the demand for investment or relate it to the

8973

supply of savings. But, as we argued in section C.8, it is not at all

8974

clear that the interest rate provides the necessary information to

8975

capitalists. They need investment information for their specific

8976

industry, but the interest rate is cross-industry. Thus capitalists in

8977

market X do not know if the investment in market X is increasing

8978

and so this lack of information can easily cause "mal-investment" as

8979

over-investment (and so over-production) occurs. As they have no

8980

way of knowing what the investment decisions of their competitors are

8981

or now these decisions will affect an already unknown future, capitalists

8982

may over-invest in certain markets and the net effects of this aggregate

8983

mistake can expand throughout the whole economy and cause a general

8984

slump. In other words, a cluster of business failures can be accounted

8985

for by the workings of the market itself and *not* the (existence of)

8986

government.

8987

8988

This is *one* possible reason for an internally generated business cycle

8989

but that is not the only one. Another is the role of class struggle which

8990

we discuss in the next section and yet another is the endogenous nature

8991

of the money supply itself. This account of money (proposed strongly by,

8992

among others, the post-Keynesian school) argues that the money supply

8993

is a function of the demand for credit, which itself is a function of the

8994

level of economic activity. In other words, the banking system creates

8995

as much money as people need and any attempt to control that creation

8996

will cause economic problems and, perhaps, crisis (interestingly, this

8997

analysis has strong parallels with mutualist and individualist anarchist

8998

theories on the causes of capitalist exploitation and the business

8999

cycle). Money, in other words, emerges from *within* the system and

9000

so the right-libertarian attempt to "blame the state" is simply wrong.

9001

9002

Thus what is termed "credit money" (created by banks) is an essential

9003

part of capitalism and would exist without a system of central banks.

9004

This is because money is created from within the system, in response

9005

to the needs of capitalists. In a word, money is endogenous and credit

9006

money an essential part of capitalism.

9007

9008

Right-libertarians do not agree. Reekie argues that "[o]nce fractional

9009

reserve banking is introduced, however, the supply of money substitutes

9010

will include fiduciary media. The ingenuity of bankers, other financial

9011

intermediaries and the endorsement and *guaranteeing of their activities

9012

by governments and central banks* has ensured that the quantity of fiat

9013

money is immense." [Op. Cit., p. 73]

9014

9015

Therefore, what "anarcho"-capitalists and other right-libertarians seem

9016

to be actually complaining about when they argue that "state action" creates

9017

the business cycle by creating excess money is that the state *allows*

9018

bankers to meet the demand for credit by creating it. This makes sense,

9019

for the first fallacy of this sort of claim is how could the state *force*

9020

bankers to expand credit by loaning more money than they have savings.

9021

And this seems to be the normal case within capitalism -- the central

9022

banks accommodate bankers activity, they do not force them to do it. Alan

9023

Holmes, a senior vice president at the New York Federal Reserve, stated

9024

that:

9025

9026

"In the real world, banks extend credit, creating deposits in the

9027

process, and look for the reserves later. The question then becomes

9028

one of whether and how the Federal Reserve will accommodate the demand

9029

for reserves. In the very short run, the Federal Reserve has little or

9030

no choice about accommodating that demand, over time, its influence

9031

can obviously be felt." [quoted by Doug Henwood, _Wall Street_, p. 220]

9032

9033

(Although we must stress that central banks are *not* passive and do have

9034

many tools for affecting the supply of money. For example, central banks

9035

can operate "tight" money policies which can have significant impact on

9036

an economy and, via creating high enough interest rates, the demand for

9037

money.)

9038

9039

It could be argued that because central banks exist, the state

9040

creates an "environment" which bankers take advantage off. By not

9041

being subject to "free market" pressures, bankers could be tempted to

9042

make more loans than they would otherwise in a "pure" capitalist system

9043

(i.e. create credit money). The question arises, would "pure" capitalism

9044

generate sufficient market controls to stop banks loaning in excess of

9045

available savings (i.e. eliminate the creation of credit money/fiduciary

9046

media).

9047

9048

It is to this question we now turn.

9049

9050

As noted above, the demand for credit is generated from *within* the system

9051

and the comments by Holmes reinforce this. Capitalists seek credit in order

9052

to make money and banks create it precisely because they are also seeking

9053

profit. What right-libertarians actually object to is the government (via

9054

the central bank) *accommodating* this creation of credit. If only the

9055

banks could be forced to maintain a savings to loans ratio of one, then

9056

the business cycle would stop. But is this likely? Could market forces

9057

ensure that bankers pursue such a policy? We think not -- simply because

9058

the banks are profit making institutions. As post-Keynesianist Hyman Minsky

9059

argues, "[b]ecause bankers live in the same expectational climate as

9060

businessmen, profit-seeking bankers will find ways of accommodating their

9061

customers. . . Banks and bankers are not passive managers of money to

9062

lend or to invest; they are in business to maximise profits. . ." [quoted

9063

by L. Randall Wray, _Money and Credit in Capitalist Economies_, p. 85]

9064

9065

This is recognised by Reekie, in passing at least (he notes that "fiduciary

9066

media could still exist if bankers offered them and clients accepted them"

9067

[Op. Cit., p. 73]). Bankers will tend to try and accommodate their customers

9068

and earn as much money as possible. Thus Charles P. Kindleberger comments

9069

that monetary expansion "is systematic and endogenous rather than random

9070

and exogenous" seem to fit far better the reality of capitalism that the

9071

Austrian and right-libertarian viewpoint [_Manias, Panics, and Crashes_,

9072

p. 59] and post-Keynesian L. Randall Wray argues that "the money supply

9073

. . . is more obviously endogenous in the monetary systems which predate

9074

the development of a central bank." [Op. Cit., p. 150]

9075

9076

In other words, the money supply cannot be directly controlled by the

9077

central bank since it is determined by private decisions to enter into

9078

debt commitments to finance spending. Given that money is generated

9079

from *within* the system, can market forces ensure the non-expansion

9080

of credit (i.e. that the demand for loans equals the supply of savings)?

9081

To begin to answer this question we must note that investment is

9082

"essentially determined by expected profitability." [Philip Arestis,

9083

_The Post-Keynesian Approach to Economics_, p. 103] This means

9084

that the actions of the banks cannot be taken in isolation from the rest

9085

of the economy. Money, credit and banks are an essential part of

9086

the capitalist system and they cannot be artificially isolated from

9087

the expectations, pressures and influences of that system.

9088

9089

Let us assume that the banks desire to maintain a loans to savings

9090

ratio of one and try to adjust their interest rates accordingly. Firstly,

9091

changes in the rate of interest "produce only a very small, if any,

9092

movement in business investment" according to empirical evidence

9093

[Op. Cit., pp. 82-83] and that "the demand for credit is extremely

9094

inelastic with respect to interest rates." [L. Randall Wray, Op. Cit.,

9095

p. 245] Thus, to keep the supply of savings in line with the demand

9096

for loans, interest rates would have to increase greatly (indeed,

9097

trying to control the money supply by controlling the monetary bases

9098

in this way will only lead to very big fluctuations in interest rates).

9099

And increasing interest rates has a couple of paradoxical effects.

9100

9101

According to economists Joseph Stiglitz and Andrew Weiss (in "Credit

9102

Rationing in Markets with Imperfect Knowledge", _American Economic

9103

Review_, no. 71, pp. 393-410) interest rates are subject to what is called the

9104

"lemon problem" (asymmetrical information between buyer and seller). Stiglitz

9105

and Weiss applied the "lemons problem" to the credit market and argued

9106

(and unknowingly repeated Adam Smith) that at a given interest rate, lenders

9107

will earn lower returns by lending to bad borrowers (because of defaults)

9108

than to good ones. If lenders try to increase interest rates to compensate

9109

for this risk, they may chase away good borrowers, who are unwilling to

9110

pay a higher rate, while perversely not chasing away incompetent, criminal,

9111

or malignantly optimistic borrowers. This means that an increase in interest

9112

rates may actually increase the possibilities of crisis, as more loans may

9113

end up in the hands of defaulters.

9114

9115

This gives banks a strong incentive to keep interest rates lower than

9116

they otherwise could be. Moreover, "increases in interest rates make

9117

it more difficult for economic agents to meet their debt repayments"

9118

[Philip Arestis, Op. Cit., pp. 237-8] which means when interest rates

9119

*are* raised, defaults will increase and place pressures on the banking

9120

system. At high enough short-term interest rates, firms find it hard to

9121

pay their interest bills, which cause/increase cash flow problems and

9122

so "[s]harp increases in short term interest rates . . .leads to a fall

9123

in the present value of gross profits after taxes (quasi-rents) that

9124

capital assets are expected to earn." [Hyman Minsky, _Post-Keynesian

9125

Economic Theory_, p. 45]

9126

9127

In addition, "production of most investment goods is undertaken on

9128

order and requires time for completion. A rise in interest rates is not

9129

likely to cause firms to abandon projects in the process of production

9130

. . . This does not mean . . . that investment is completely unresponsive

9131

to interest rates. A large increase in interest rates causes a 'present

9132

value reversal', forcing the marginal efficiency of capital to fall

9133

below the interest rate. If the long term interest rate is also

9134

pushed above the marginal efficiency of capital, the project may be

9135

abandoned." [Wray, Op. Cit., pp. 172-3] In other words, investment

9136

takes *time* and there is a lag between investment decisions and actual

9137

fixed capital investment. So if interest rates vary during this lag

9138

period, initially profitable investments may become white elephants.

9139

9140

As Michal Kalecki argued, the rate of interest must be lower than the

9141

rate of profit otherwise investment becomes pointless. The incentive for

9142

a firm to own and operate capital is dependent on the prospective rate

9143

of profit on that capital relative to the rate of interest at which the

9144

firm can borrow at. The higher the interest rate, the less promising

9145

investment becomes.

9146

9147

If investment is unresponsive to all but very high interest rates (as

9148

we indicated above), then a privatised banking system will be under

9149

intense pressure to keep rates low enough to maintain a boom (by,

9150

perhaps, creating credit above the amount available as savings). And

9151

if it does this, over-investment and crisis is the eventual outcome. If it

9152

does not do this and increases interest rates then consumption and

9153

investment will dry up as interest rates rise and the defaulters (honest

9154

and dishonest) increase and a crisis will eventually occur.

9155

9156

This is because increasing interest rates may increase savings *but*

9157

it also reduces consumption ("high interest rates also deter both consumers

9158

and companies from spending, so that the domestic economy is weakened

9159

and unemployment rises" [Paul Ormerod, _The Death of Economics_, p. 70]).

9160

This means that firms can face a drop off in demand, causing them problems

9161

and (perhaps) leading to a lack of profits, debt repayment problems and

9162

failure. An increase in interest rates also reduces demand for investment

9163

goods, which also can cause firms problems, increase unemployment and

9164

so on. So an increase in interest rates (particularly a sharp rise) could

9165

reduce consumption and investment (i.e. reduce aggregate demand) and have

9166

a ripple effect throughout the economy which could cause a slump to occur.

9167

9168

In other words, interest rates and the supply and demand of savings/loans

9169

they are meant to reflect may not necessarily move an economy towards

9170

equilibrium (if such a concept is useful). Indeed, the workings of a

9171

"pure" banking system without credit money may increase unemployment

9172

as demand falls in both investment and consumption in response to

9173

high interest rates and a general shortage of money due to lack of

9174

(credit) money resulting from the "tight" money regime implied by

9175

such a regime (i.e. the business cycle would still exist). This was

9176

the case of the failed Monetarist experiments on the early 1980s when

9177

central banks in America and Britain tried to pursue a "tight" money

9178

policy. The "tight" money policy did not, in fact, control the money

9179

supply. All it did do was increase interest rates and lead to a serious

9180

financial crisis and a deep recession (as Wray notes, "the central

9181

bank uses tight money polices to raise interest rates" [Op. Cit.,

9182

p. 262]). This recession, we must note, also broke the backbone of

9183

working class resistance and the unions in both countries due to the

9184

high levels of unemployment it generated. As intended, we are sure.

9185

9186

Such an outcome would not surprise anarchists, as this was a key feature

9187

of the Individualist and Mutualist Anarchists' arguments against the

9188

"money monopoly" associated with specie money. They argued that

9189

the "money monopoly" created a "tight" money regime which reduced

9190

the demand for labour by restricting money and credit and so

9191

allowed the exploitation of labour (i.e. encouraged wage labour)

9192

and stopped the development of non-capitalist forms of production.

9193

Thus Lysander Spooner's comments that workers need "*money capital*

9194

to enable them to buy the raw materials upon which to bestow their

9195

labour, the implements and machinery with which to labour . . . Unless

9196

they get this capital, they must all either work at a disadvantage,

9197

or not work at all. A very large portion of them, to save themselves

9198

from starvation, have no alternative but to sell their labour to

9199

others . . ." [_A Letter to Grover Cleveland_, p. 39] It is interesting

9200

to note that workers *did* do well during the 1950s and 1960s under

9201

a "liberal" money regime than they did under the "tighter" regimes of

9202

the 1980s and 1990s.

9203

9204

We should also note that an extended period of boom will encourage banks

9205

to make loans more freely. According to Minsky's "financial instability

9206

model" crisis (see "The Financial Instability Hypothesis" in _Post-Keynesian

9207

Economic Theory_ for example) is essentially caused by risky financial

9208

practices during periods of financial tranquillity. In other words,

9209

"stability is destabilising." In a period of boom, banks are happy and

9210

the increased profits from companies are flowing into their vaults.

9211

Over time, bankers note that they can use a reserve system to increase

9212

their income and, due to the general upward swing of the economy,

9213

consider it safe to do so (and given that they are in competition

9214

with other banks, they may provide loans simply because they are

9215

afraid of losing customers to more flexible competitors). This

9216

increases the instability within the system (as firms increase

9217

their debts due to the flexibility of the banks) and produces the

9218

possibility of crisis if interest rates are increased (because

9219

the ability of business to fulfil their financial commitments

9220

embedded in debts deteriorates).

9221

9222

Even if we assume that interest rates *do* work as predicted in

9223

theory, it is false to maintain that there is one interest rate. This

9224

is not the case. "Concentration of capital leads to unequal access to

9225

investment funds, which obstructs further the possibility of smooth

9226

transitions in industrial activity. Because of their past record of

9227

profitability, large enterprises have higher credit ratings and easier

9228

access to credit facilities, and they are able to put up larger collateral

9229

for a loan." [Michael A. Bernstein, _The Great Depression_, p. 106] As

9230

we noted in section C.5.1, the larger the firm, the lower the interest

9231

rate they have to pay. Thus banks routinely lower their interest rates

9232

to their best clients even though the future is uncertain and past

9233

performance cannot and does not indicate future returns. Therefore

9234

it seems a bit strange to maintain that the interest rate will bring

9235

savings and loans into line if there are different rates being offered.

9236

9237

And, of course, private banks cannot affect the underlying fundamentals

9238

that drive the economy -- like productivity, working class power and

9239

political stability -- any more than central banks (although central

9240

banks can influence the speed and gentleness of adjustment to a crisis).

9241

9242

Indeed, given a period of full employment a system of private banks may

9243

actually speed up the coming of a slump. As we argue in the next section,

9244

full employment results in a profits squeeze as firms face a tight labour

9245

market (which drives up costs) and, therefore, increased workers' power

9246

at the point of production and in their power of exit. In a central bank

9247

system, capitalists can pass on these increasing costs to consumers and

9248

so maintain their profit margins for longer. This option is restricted

9249

in a private banking system as banks would be less inclined to devalue

9250

their money. This means that firms will face a profits squeeze sooner

9251

rather than later, which will cause a slump as firms cannot make ends

9252

meet. As Reekie notes, inflation "can temporarily reduce employment

9253

by postponing the time when misdirected labour will be laid off" but

9254

as Austrian's (like Monetarists) think "inflation is a monetary

9255

phenomenon" he does not understand the real causes of inflation

9256

and what they imply for a "pure" capitalist system [Op. Cit., p. 67,

9257

p. 74]. As Paul Ormerod points out "the claim that inflation is always

9258

and everywhere purely caused by increases in the money supply, and

9259

that there the rate of inflation bears a stable, predictable relationship

9260

to increases in the money supply is ridiculous." And he notes that

9261

"[i]ncreases in the rate of inflation tend to be linked to falls in

9262

unemployment, and vice versa" which indicates its *real* causes --

9263

namely in the balance of class power and in the class struggle.

9264

[_The Death of Economics_, p. 96, p. 131]

9265

9266

Moreover, if we do take the Austrian theory of the business cycle at

9267

face value we are drawn to conclusion that in order to finance investment

9268

savings must be increased. But to maintain or increase the stock of

9269

loanable savings, inequality must be increased. This is because,

9270

unsurprisingly, rich people save a larger proportion of their income

9271

than poor people and the proportion of profits saved are higher than

9272

the proportion of wages. But increasing inequality (as we argued in

9273

section 3.1) makes a mockery of right-libertarian claims that their

9274

system is based on freedom or justice.

9275

9276

This means that the preferred banking system of "anarcho"-capitalism

9277

implies increasing, not decreasing, inequality within society. Moreover,

9278

most firms (as we indicated in section C.5.1) fund their investments

9279

with their own savings which would make it hard for banks to loan

9280

these savings out as they could be withdrawn at any time. This could

9281

have serious implications for the economy, as banks refuse to fund

9282

new investment simply because of the uncertainty they face when

9283

accessing if their available savings can be loaned to others (after all,

9284

they can hardly loan out the savings of a customer who is likely to

9285

demand them at any time). And by refusing to fund new investment, a

9286

boom could falter and turn to slump as firms do not find the necessary

9287

orders to keep going.

9288

9289

So, would market forces create "sound banking"? The answer is probably

9290

not. The pressures on banks to make profits come into conflict with

9291

the need to maintain their savings to loans ration (and so the

9292

confidence of their customers). As Wray argues, "as banks are profit

9293

seeking firms, they find ways to increase their liabilities which

9294

don't entail increases in reserve requirements" and "[i]f banks share

9295

the profit expectations of prospective borrowers, they can create

9296

credit to allow [projects/investments] to proceed." [Op. Cit., p. 295,

9297

p. 283] This can be seen from the historical record. As Kindleberger

9298

notes, "the market will create new forms of money in periods of

9299

boom to get around the limit" imposed on the money supply [Op. Cit.,

9300

p. 63]. Trade credit is one way, for example. Under the Monetarist

9301

experiments of 1980s, there was "deregulation and central bank

9302

constraints raised interest rates and created a moral hazard --

9303

banks made increasingly risky loans to cover rising costs of issuing

9304

liabilities. Rising competition from nonbanks and tight money

9305

policy forced banks to lower standards and increase rates of growth

9306

in an attempt to 'grow their way to profitability'" [Op. Cit., p. 293]

9307

9308

Thus credit money ("fiduciary media") is an attempt to overcome the

9309

scarcity of money within capitalism, particularly the scarcity of

9310

specie money. The pressures that banks face within "actually

9311

existing" capitalism would still be faced under "pure" capitalism.

9312

It is likely (as Reekie acknowledges) that credit money would still

9313

be created in response to the demands of business people (although

9314

not at the same level as is currently the case, we imagine). The

9315

banks, seeking profits themselves and in competition for customers,

9316

would be caught between maintaining the value of their business

9317

(i.e. their money) and the needs to maximise profits. As a boom

9318

develops, banks would be tempted to introduce credit money to

9319

maintain it as increasing the interest rate would be difficult

9320

and potentially dangerous (for reasons we noted above). Thus, if

9321

credit money is not forth coming (i.e. the banks stick to the

9322

Austrian claims that loans must equal savings) then the rise in

9323

interest rates required will generate a slump. If it is forthcoming,

9324

then the danger of over-investment becomes increasingly likely.

9325

All in all, the business cycle is part of capitalism and *not*

9326

caused by "external" factors like the existence of government.

9327

9328

As Reekie notes, to Austrians "ignorance of the future is endemic"

9329

[Op. Cit., p. 117] but you would be forgiven for thinking that this

9330

is not the case when it comes to investment. An individual firm

9331

cannot know whether its investment project will generate the stream

9332

of returns necessary to meet the stream of payment commitments

9333

undertaken to finance the project. And neither can the banks who

9334

fund those projects. Even *if* a bank does not get tempted into

9335

providing credit money in excess of savings, it cannot predict

9336

whether other banks will do the same or whether the projects it

9337

funds will be successful. Firms, looking for credit, may turn to

9338

more flexible competitors (who practice reserve banking to some

9339

degree) and the inflexible bank may see its market share and

9340

profits decrease. After all, commercial banks "typically establish

9341

relations with customers to reduce the uncertainty involved in

9342

making loans. Once a bank has entered into a relationship with

9343

a customer, it has strong incentives to meet the demands of

9344

that customer." [Wray, Op. Cit., p. 85]

9345

9346

There are example of fully privatised banks. For example, in the

9347

United States ("which was without a central bank after 1837") "the

9348

major banks in New York were in a bind between their roles as

9349

profit seekers, which made them contributors to the instability

9350

of credit, and as possessors of country deposits against whose

9351

instability they had to guard." [Kindleberger, Op. Cit., p. 85]

9352

9353

In Scotland, the banks were unregulated between 1772 and 1845

9354

but "the leading commercial banks accumulated the notes of lessor

9355

ones, as the Second Bank of the United States did contemporaneously

9356

in [the USA], ready to convert them to specie if they thought

9357

they were getting out of line. They served, that is, as an

9358

informal controller of the money supply. For the rest, as so

9359

often, historical evidence runs against strong theory, as

9360

demonstrated by the country banks in England from 1745 to 1835,

9361

wildcat banking in Michigan in the 1830s, and the latest

9362

experience with bank deregulation in Latin America." [Op. Cit.,

9363

p. 82] And we should note there were a few banking "wars" during

9364

the period of deregulation in Scotland which forced a few of the

9365

smaller banks to fail as the bigger ones refused their money

9366

and that there was a major bank failure in the Ayr Bank.

9367

9368

Kendleberger argues that central banking "arose to impose control

9369

on the instability of credit" and did not cause the instability

9370

which right-libertarians maintain it does. And as we note in

9371

section 10.3, the USA suffered massive economic instability

9372

during its period without central banking. Thus, *if* credit

9373

money *is* the cause of the business cycle, it is likely that

9374

a "pure" capitalism will still suffer from it just as much as

9375

"actually existing" capitalism (either due to high interest rates

9376

or over-investment).

9377

9378

In general, as the failed Monetarist experiments of the 1980s prove,

9379

trying to control the money supply is impossible. The demand for money

9380

is dependent on the needs of the economy and any attempt to control

9381

it will fail (and cause a deep depression, usually via high interest

9382

rates). The business cycle, therefore, is an endogenous phenomenon caused

9383

by the normal functioning of the capitalist economic system. Austrian

9384

and right-libertarian claims that "slump flows boom, but for a totally

9385

unnecessary reason: government inspired mal-investment" [Reekie, Op.

9386

Cit., p. 74] are simply wrong. Over-investment *does* occur, but it

9387

is *not* "inspired" by the government. It is "inspired" by the banks

9388

need to make profits from loans and from businesses need for investment

9389

funds which the banks accommodate. In other words, by the nature of

9390

the capitalist system.

9391

9392

10.2 How does the labour market effect capitalism?

9393

9394

In many ways, the labour market is the one that affects capitalism the

9395

most. The right-libertarian assumption (like that of mainstream economics)

9396

is that markets clear and, therefore, the labour market will also clear.

9397

As this assumption has rarely been proven to be true in actuality (i.e.

9398

periods of full employment within capitalism are few and far between),

9399

this leaves its supporters with a problem -- reality contradicts the

9400

theory.

9401

9402

The theory predicts full employment but reality shows that this is not

9403

the case. Since we are dealing with logical deductions from assumptions,

9404

obviously the theory cannot be wrong and so we must identify external

9405

factors which cause the business cycle (and so unemployment). In this

9406

way attention is diverted away from the market and its workings --

9407

after all, it is assumed that the capitalist market works -- and onto

9408

something else. This "something else" has been quite a few different

9409

things (most ridiculously, sun spots in the case of one of the founders of

9410

marginalist economics, William Stanley Jevons). However, these days most

9411

pro-free market capitalist economists and right-libertarians have now

9412

decided it is the state.

9413

9414

In this section of the FAQ we will present a case that maintains that

9415

the assumption that markets clear is false at least for one, unique,

9416

market -- namely, the market for labour. As the fundamental assumption

9417

underlying "free market" capitalism is false, the logically consistent

9418

superstructure built upon comes crashing down. Part of the reason why

9419

capitalism is unstable is due to the commodification of labour (i.e.

9420

people) and the problems this creates. The state itself can have

9421

positive and negative impacts on the economy, but removing it or

9422

its influence will not solve the business cycle.

9423

9424

Why is this? Simply due to the nature of the labour market.

9425

9426

Anarchists have long realised that the capitalist market is based upon

9427

inequalities and changes in power. Proudhon argued that "[t]he manufacturer

9428

says to the labourer, 'You are as free to go elsewhere with your services

9429

as I am to receive them. I offer you so much.' The merchant says to the

9430

customer, 'Take it or leave it; you are master of your money, as I am

9431

of my goods. I want so much.' Who will yield? The weaker." He, like all

9432

anarchists, saw that domination, oppression and exploitation flow from

9433

inequalities of market/economic power and that the "power of invasion

9434

lies in superior strength." [_What is Property?_, p. 216, p. 215]

9435

9436

This applies with greatest force to the labour market. While mainstream

9437

economics and right-libertarian variations of it refuse to acknowledge

9438

that the capitalist market is a based upon hierarchy and power, anarchists

9439

(and other socialists) do not share this opinion. And because they do

9440

not share this understanding with anarchists, right-libertarians will

9441

never be able to understand capitalism or its dynamics and development.

9442

Thus, when it comes to the labour market, it is essential to remember

9443

that the balance of power within it is the key to understanding the

9444

business cycle. Thus the economy must be understood as a system of

9445

power.

9446

9447

So how does the labour market effect capitalism? Let us consider a

9448

growing economy, on that is coming out of a recession. Such a growing

9449

economy stimulates demand for employment and as unemployment falls,

9450

the costs of finding workers increase and wage and condition demands

9451

of existing workers intensify. As the economy is growing and labour

9452

is scare, the threat associated with the hardship of unemployment is

9453

weakened. The share of profits is squeezed and in reaction to this

9454

companies begin to cut costs (by reducing inventories, postponing

9455

investment plans and laying off workers). As a result, the economy

9456

moves into a downturn. Unemployment rises and wage demands are

9457

moderated. Eventually, this enables the share of profits first of all to

9458

stabilise, and then rise. Such an "interplay between profits and

9459

unemployment as the key determinant of business cycles" is

9460

"observed in the empirical data." [Paul Ormerod, _The Death

9461

of Economics_, p. 188]

9462

9463

Thus, as an economy approaches full employment the balance of power on

9464

the labour market changes. The sack is no longer that great a threat

9465

as people see that they can get a job elsewhere easily. Thus wages

9466

and working conditions increase as companies try to get new (and

9467

keep) existing employees and output is harder to maintain. In the

9468

words of economist William Lazonick, labour "that is able to command

9469

a higher price than previously because of the appearance of tighter

9470

labour markets is, by definition, labour that is highly mobile via

9471

the market. And labour that is highly mobile via the market is labour

9472

whose supply of effort is difficult for managers to control in the

9473

production process. Hence, the advent of tight labour markets generally

9474

results in more rapidly rising average costs . . .as well as upward

9475

shifts in the average cost curve. . ." [_Business Organisation and

9476

the Myth of the Market Economy_, p. 106]

9477

9478

In other words, under conditions of full-employment "employers are

9479

in danger of losing the upper hand." [Juliet B. Schor, _The Overworked

9480

American_, p. 75] Schor argues that "employers have a structural advantage

9481

in the labour market, because there are typically more candidates ready

9482

and willing to endure this work marathon [of long hours] than jobs

9483

for them to fill." [p. 71] Thus the labour market is usually a buyers

9484

market, and so the sellers have to compromise. In the end, workers

9485

adapt to this inequality of power and instead of getting what they

9486

want, they want what they get.

9487

9488

But under full employment this changes. As we argued in section B.4.4

9489

and section C.7, in such a situation it is the bosses who have to

9490

start compromising. And they do not like it. As Schor notes, America

9491

"has never experienced a sustained period of full employment. The

9492

closest we have gotten is the late 1960s, when the overall unemployment

9493

rate was under 4 percent for four years. But that experience does

9494

more to prove the point than any other example. The trauma caused

9495

to business by those years of a tight labour market was considerable.

9496

Since then, there has been a powerful consensus that the nation cannot

9497

withstand such a low rate of unemployment." [Op. Cit., pp. 75-76]

9498

9499

So, in other words, full employment is not good for the capitalist

9500

system due to the power full employment provides workers. Thus

9501

unemployment is a necessary requirement for a successful capitalist

9502

economy and not some kind of aberration in an otherwise healthy system.

9503

Thus "anarcho"-capitalist claims that "pure" capitalism will soon result

9504

in permanent full employment are false. Any moves towards full employment

9505

will result in a slump as capitalists see their profits squeezed from below

9506

by either collective class struggle or by individual mobility in the

9507

labour market.

9508

9509

This was recognised by Individualist Anarchists like Benjamin Tucker, who

9510

argued that mutual banking would "give an unheard of impetus to business,

9511

and consequently create an unprecedented demand for labour, -- a demand

9512

which would always be in excess of the supply, directly contrary of the

9513

present condition of the labour market." [_The Anarchist Reader_, pp.

9514

149-150] In other words, full employment would end capitalist exploitation,

9515

drive non-labour income to zero and ensure the worker the full value of

9516

her labour -- in other words, end capitalism. Thus, for most (if not all)

9517

anarchists the exploitation of labour is only possible when unemployment

9518

exists and the supply of labour exceeds the demand for it. Any move

9519

towards unemployment will result in a profits squeeze and either the

9520

end of capitalism or an economic slump.

9521

9522

Indeed, as we argued in the last section, the extended periods of

9523

(approximately) full employment until the 1960s had the advantage that

9524

any profit squeeze could (in the short run anyway) be passed onto working

9525

class people in the shape of inflation. As prices rise, labour is made

9526

cheaper and profits margins supported. This option is restricted under

9527

a "pure" capitalism (for reasons we discussed in the last section) and

9528

so "pure" capitalism will be affected by full employment faster than

9529

"impure" capitalism.

9530

9531

As an economy approaches full employment, "hiring new workers suddenly

9532

becomes much more difficult. They are harder to find, cost more, and

9533

are less experiences. Such shortages are extremely costly for a firm."

9534

[Schor, Op. Cit., p. 75] This encourages a firm to pass on these rises

9535

to society in the form of price rises, so creating inflation. Workers,

9536

in turn, try to maintain their standard of living. "Every general

9537

increase in labour costs in recent years," note J. Brecher and J.

9538

Costello in the late 1970s, "has followed, rather than preceded, an

9539

increase in consumer prices. Wage increases have been the result of

9540

workers' efforts to catch up after their incomes have already been

9541

eroded by inflation. Nor could it easily be otherwise. All a businessman

9542

has to do to raise a price . . . [is to] make an announcement. . . Wage

9543

rates . . . are primarily determined by contracts" and so cannot be

9544

easily adjusted in the short term. [_Common Sense for Bad Times_,

9545

p, 120]

9546

9547

These full employment pressures will still exist with "pure" capitalism

9548

(and due to the nature of the banking system will not have the safety

9549

value of inflation). This means that periodic profit squeezes will occur,

9550

due to the nature of a tight labour market and the increased power of

9551

workers this generates. This in turn means that a "pure" capitalism will

9552

be subject to periods of unemployment (as we argued in section C.9)

9553

and so still have a business cycle. This is usually acknowledged by

9554

right-libertarians in passing, although they seem to think that this

9555

is purely a "short-term" problem (it seems a strange "short-term"

9556

problem that continually occurs).

9557

9558

But such an analysis is denied by right-libertarians. For them government

9559

action, combined with the habit of many labour unions to obtain higher

9560

than market wage rates for their members, creates and exacerbates mass

9561

unemployment. This flows from the deductive logic of much capitalist

9562

economics. The basic assumption of capitalism is that markets clear. So

9563

if unemployment exists then it can only be because the price of labour

9564

(wages) is too high (Austrian Economist W. Duncan Reekie argues

9565

that unemployment will "disappear provided real wages are not

9566

artificially high" [_Markets, Entrepreneurs and Liberty_, p. 72]).

9567

9568

Thus the assumption provokes the conclusion -- unemployment is caused

9569

by an unclearing market as markets always clear. And the cause for

9570

this is either the state or unions. But what if the labour market

9571

*cannot* clear without seriously damaging the power and profits of

9572

capitalists? What if unemployment is required to maximise profits

9573

by weakening labours' bargaining position on the market and so

9574

maximising the capitalists power? In that case unemployment is

9575

caused by capitalism, not by forces external to it.

9576

9577

However, let us assume that the right-libertarian theory is correct.

9578

Let us assume that unemployment is all the fault of the selfish unions

9579

and that a job-seeker "who does not want to wait will always get a job

9580

in the unhampered market economy." [von Mises, _Human Action_, p. 595]

9581

9582

Would crushing the unions reduce unemployment? Let us assume that the

9583

unions have been crushed and government has been abolished (or, at the

9584

very least, become a minimum state). The aim of the capitalist class is

9585

to maximise their profits and to do this they invest in labour saving

9586

machinery and otherwise attempt to increase productivity. But increasing

9587

productivity means that the prices of goods fall and falling prices

9588

mean increasing real wages. It is high real wages that, according to

9589

right-libertarians, that cause unemployment. So as a reward for increasing

9590

productivity, workers will have to have their money wages cut in order

9591

to stop unemployment occurring! For this reason some employers might

9592

refrain from cutting wages in order to avoid damage to morale - potentially

9593

an important concern.

9594

9595

Moreover, wage contracts involve *time* -- a contract will usually agree a

9596

certain wage for a certain period. This builds in rigidity into the market,

9597

wages cannot be adjusted as quickly as other commodity prices. Of course,

9598

it could be argued that reducing the period of the contract and/or allowing

9599

the wage to be adjusted could overcome this problem. However, if we reduce

9600

the period of the contract then workers are at a suffer disadvantage as they

9601

will not know if they have a job tomorrow and so they will not be able to

9602

easily plan their future (an evil situation for anyone to be in). Moreover,

9603

even without formal contracts, wage renegotiation can be expensive. After

9604

all, it takes time to bargain (and time is money under capitalism) and wage

9605

cutting can involve the risk of the loss of mutual good will between

9606

employer and employee. And would *you* give your boss the power to

9607

"adjust" your wages as he/she thought was necessary? To do so would

9608

imply an altruistic trust in others not to abuse their power.

9609

9610

Thus a "pure" capitalism would be constantly seeing employment

9611

increase and decrease as productivity levels change. There exist

9612

important reasons why the labour market need not clear which revolve

9613

around the avoidance/delaying of wage cuts by the actions of capitalists

9614

themselves. Thus, given a choice between cutting wages for all workers

9615

and laying off some workers without cutting the wages of the remaining

9616

employees, it is unsurprising that capitalists usually go for the later.

9617

After all, the sack is an important disciplining device and firing workers

9618

can make the remaining employees more inclined to work harder and be

9619

more obedient.

9620

9621

And, of course, many employers are not inclined to hire over-qualified

9622

workers. This is because, once the economy picks up again, their worker

9623

has a tendency to move elsewhere and so it can cost them time and money

9624

finding a replacement and training them. This means that involuntary

9625

unemployment can easily occur, so reducing tendencies towards full

9626

employment even more. In addition, one of the assumptions of the

9627

standard marginalist economic model is one of decreasing returns

9628

to scale. This means that as employment increases, costs rise and so

9629

prices also rise (and so real wages fall). But in reality many industries

9630

have *increasing* returns to scale, which means that as production

9631

increases unit costs fall, prices fall and so real wages rise. Thus in

9632

such an economy unemployment would increase simply because

9633

of the nature of the production process!

9634

9635

Moreover, as we argued in-depth in section C.9, a cut in money wages is

9636

not a neutral act. A cut in money wages means a reduction in demand for

9637

certain industries, which may have to reduce the wages of its employees

9638

(or fire them) to make ends meet. This could produce a accumulative

9639

effect and actually *increase* unemployment rather than reduce it.

9640

9641

In addition, there are no "self-correcting" forces at work in the

9642

labour market which will quickly bring employment back to full levels.

9643

This is for a few reasons. Firstly, the supply of labour cannot be

9644

reduced by cutting back production as in other markets. All we can

9645

do is move to other areas and hope to find work there. Secondly, the

9646

supply of labour can sometimes adjust to wage decreases in the

9647

wrong direction. Low wages might drive workers to offer a greater

9648

amount of labour (i.e. longer hours) to make up for any short

9649

fall (or to keep their job). This is usually termed the "efficiency

9650

wage" effect. Similarly, another family member may seek employment

9651

in order to maintain a given standard of living. Falling wages may

9652

cause the number of workers seeking employment to *increase*,

9653

causing a full further fall in wages and so on (and this is ignoring

9654

the effects of lowering wages on demand discussed in section C.9).

9655

9656

The paradox of piece work is an important example of this effect.

9657

As Schor argues, "piece-rate workers were caught in a viscous

9658

downward spiral of poverty and overwork. . . When rates were

9659

low, they found themselves compelled to make up in extra output

9660

what they were losing on each piece. But the extra output produced

9661

glutted the market and drove rates down further." [Juliet C. Schor,

9662

_The Overworked American_, p, 58]

9663

9664

Thus, in the face of reducing wages, the labour market may see an

9665

accumulative move away from (rather than towards) full employment,

9666

The right-libertarian argument is that unemployment is caused by real

9667

wages being too high which in turn flows from the assumption that markets

9668

clear. If there is unemployment, then the price of the commodity labour

9669

is too high -- otherwise supply and demand would meet and the market

9670

clear. But if, as we argued above, unemployment is essential to

9671

discipline workers then the labour market *cannot* clear except for

9672

short periods. If the labour market clears, profits are squeezed. Thus

9673

the claim that unemployment is caused by "too high" real wages is false

9674

(and as we argue in section C.9, cutting these wages will result in

9675

deepening any slump and making recovery longer to come about).

9676

9677

In other words, the assumption that the labour market must clear

9678

is false, as is any assumption that reducing wages will tend to push

9679

the economy quickly back to full employment. The nature of wage labour

9680

and the "commodity" being sold (i.e. human labour/time/liberty) ensure

9681

that it can never be the same as others. This has important implications

9682

for economic theory and the claims of right-libertarians, implications

9683

that they fail to see due to their vision of labour as a commodity

9684

like any other.

9685

9686

The question arises, of course, of whether, during periods of full

9687

employment, workers could not take advantage of their market power

9688

and gain increased workers' control, create co-operatives and so

9689

reform away capitalism. This was the argument of the Mutualist and

9690

Individualist anarchists and it does have its merits. However, it

9691

is clear (see section J.5.12) that bosses hate to have their authority

9692

reduced and so combat workers' control whenever they can. The logic

9693

is simple, if workers increase their control within the workplace

9694

the manager and bosses may soon be out of a job and (more importantly)

9695

they may start to control the allocation of profits. Any increase

9696

in working class militancy may provoke capitalists to stop/reduce

9697

investment and credit and so create the economic environment (i.e.

9698

increasing unemployment) necessary to undercut working class power.

9699

9700

In other words, a period of full unemployment is not sufficient to

9701

reform capitalism away. Full employment (nevermind any struggle over

9702

workers' control) will reduce profits and if profits are reduced

9703

then firms find it hard to repay debts, fund investment and provide

9704

profits for shareholders. This profits squeeze would be enough to

9705

force capitalism into a slump and any attempts at gaining workers'

9706

self-management in periods of high employment will help push it

9707

over the edge (after all, workers' control without control over the

9708

allocation of any surplus is distinctly phoney). Moreover, even if

9709

we ignore the effects of full employment may not last due to problems

9710

associated with over-investment (see section C.7.2), credit and interest

9711

rate problems (see section 10.1) and realisation/aggregate demand

9712

disjoints. Full employment adds to the problems associated with the

9713

capitalist business cycle and so, if class struggle and workers power

9714

did not exist or cost problem, capitalism would still not be stable.

9715

9716

If equilibrium is a myth, then so is full employment. It seems

9717

somewhat ironic that "anarcho"-capitalists and other right-libertarians

9718

maintain that there will be equilibrium (full employment) in the one

9719

market within capitalism it can never actually exist in! This is

9720

usually quietly acknowledged by most right-libertarians, who mention

9721

in passing that some "temporary" unemployment *will* exist in their

9722

system -- but "temporary" unemployment is not full employment. Of course,

9723

you could maintain that all unemployment is "voluntary" and get round

9724

the problem by denying it, but that will not get us very far.

9725

9726

So it is all fine and well saying that "libertarian" capitalism would be

9727

based upon the maxim "From each as they choose, to each as they are chosen."

9728

[Robert Nozick, _Anarchy, State, and Utopia_, p. 160] But if the labour

9729

market is such that workers have little option about what they "choose"

9730

to give and fear that they will *not* be chosen, then they are at a

9731

disadvantage when compared to their bosses and so "consent" to being

9732

treated as a resource from the capitalist can make a profit from. And

9733

so this will result in any "free" contract on the labour market favouring

9734

one party at the expense of the other -- as can be seen from "actually

9735

existing capitalism".

9736

9737

Thus any "free exchange" on the labour market will usually *not* reflect

9738

the true desires of working people (and who will make all the "adjusting"

9739

and end up wanting what they get). Only when the economy is approaching

9740

full employment will the labour market start to reflect the true desires

9741

of working people and their wage start to approach its full product.

9742

And when this happens, profits are squeezed and capitalism goes into

9743

slump and the resulting unemployment disciplines the working class and

9744

restores profit margins. Thus full employment will be the exception

9745

rather than the rule within capitalism (and that is a conclusion which

9746

the historical record indicates).

9747

9748

In other words, in a normally working capitalist economy any labour

9749

contracts will not create relationships based upon freedom due to

9750

the inequalities in power between workers and capitalists. Instead,

9751

any contracts will be based upon domination, *not* freedom. Which

9752

prompts the question, how is libertarian capitalism *libertarian* if

9753

it erodes the liberty of a large class of people?

9754

9755

10.3 Was laissez-faire capitalism stable?

9756

9757

Firstly, we must state that a pure laissez-faire capitalist system has

9758

not existed. This means that any evidence we present in this section

9759

can be dismissed by right-libertarians for precisely this fact -- it

9760

was not "pure" enough. Of course, if they were consistent, you would

9761

expect them to shun all historical and current examples of capitalism

9762

or activity within capitalism, but this they do not. The logic is

9763

simple -- if X is good, then it is permissible to use it. If X is

9764

bad, the system is not pure enough.

9765

9766

However, as right-libertarians *do* use historical examples so shall

9767

we. According to Murray Rothbard, there was "quasi-laissez-faire

9768

industrialisation [in] the nineteenth century" [_The Ethics of Liberty_,

9769

p. 264] and so we will use the example of nineteenth century America --

9770

as this is usually taken as being the closest to pure laissez-faire --

9771

in order to see if laissez-faire is stable or not.

9772

9773

Yes, we are well aware that 19th century USA was far from laissez-faire

9774

so on -- but as this example has been often used by right-Libertarians'

9775

themselves (for example, Ayn Rand) we think that we can gain a lot from

9776

looking at this imperfect approximation of "pure" capitalism (and as

9777

we argued in section 8, it is the "quasi" aspects of the system that

9778

counted in industrialisation, *not* the laissez-faire ones).

9779

9780

So, was 19th century America stable? No, it most definitely was not.

9781

9782

Firstly, throughout that century there were a continual economic booms

9783

and slumps. The last third of the 19th century (often considered

9784

as a heyday of private enterprise) was a period of profound instability

9785

and anxiety. Between 1867 and 1900 there were 8 complete business

9786

cycles. Over these 396 months, the economy expanded during 199 months

9787

and contracted during 197. Hardly a sign of great stability (since the

9788

end of world war II, only about a fifth of the time has spent in periods

9789

of recession or depression, by way of comparison). Overall, the

9790

economy went into a slump, panic or crisis in 1807, 1817, 1828,

9791

1834, 1837, 1854, 1857, 1873, 1882, and 1893 (in addition, 1903

9792

and 1907 were also crisis years).

9793

9794

Part of this instability came from the eras banking system. "Lack of

9795

a central banking system," writes Richard Du Boff, "until the Federal

9796

Reserve act of 1913 made financial panics worse and business cycle

9797

swings more severe" [_Accumulation and Power_, p. 177] It was in

9798

response to this instability that the Federal Reserve system was

9799

created; and as Doug Henwood notes "the campaign for a more rational

9800

system of money and credit was not a movement of Wall Street vs. industry

9801

or regional finance, but a broad movement of elite bankers and the

9802

managers of the new corporations as well as academics and business

9803

journalists. The emergence of the Fed was the culmination of attempts

9804

to define a standard of value that began in the 1890s with the emergence

9805

of the modern professionally managed corporation owned not by its managers

9806

but dispersed public shareholders." [_Wall Street_, p. 93] Indeed,

9807

the Bank of England was often forced to act as lender of last resort

9808

to the US, which had no central bank.

9809

9810

In the decentralised banking system of the 19th century, during panics

9811

thousands of banks would hoard resources, so starving the system for

9812

liquidity precisely at the moment it was most badly needed. The creation

9813

of trusts was one way in which capitalists tried to manage the system's

9814

instabilities (at the expense of consumers) and the corporation was a

9815

response to the outlawing of trusts. "By internalising lots of the

9816

competitive system's gaps -- by bring more transactions within the same

9817

institutional walls -- corporations greatly stabilised the economy."

9818

[Henwood, Op. Cit., p. 94]

9819

9820

All during the hey-day of laissez faire we also find popular protests

9821

against the money system used, namely specie (in particular gold), which

9822

was considered as a hindrance to economic activity and expansion (as well

9823

as being a tool for the rich). The Individualist Anarchists, for example,

9824

considered the money monopoly (which included the use of specie as money)

9825

as the means by which capitalists ensured that "the labourers . . . [are]

9826

kept in the condition of wage labourers," and reduced "to the conditions

9827

of servants; and subject to all such extortions as their employers . . .

9828

may choose to practice upon them", indeed they became the "mere tools

9829

and machines in the hands of their employers". With the end of this

9830

monopoly, "[t]he amount of money, capable of being furnished . . .

9831

[would assure that all would] be under no necessity to act as a servant,

9832

or sell his or her labour to others." [Lysander Spooner, _A Letter to

9833

Grover Cleveland_, p. 47, p. 39, p. 50, p. 41] In other words, a specie

9834

based system (as desired by many "anarcho"-capitalists) was considered

9835

a key way of maintaining wage labour and exploitation.

9836

9837

Interestingly, since the end of the era of the Gold Standard (and so

9838

commodity money) popular debate, protest and concern about money has

9839

disappeared. The debate and protest was in response to the *effects* of

9840

commodity money on the economy -- with many people correctly viewing

9841

the seriously restrictive monetary regime of the time responsible for

9842

economic problems and crisis as well as increasing inequalities. Instead

9843

radicals across the political spectrum urged a more flexible regime,

9844

one that did not cause wage slavery and crisis by reducing the amount

9845

of money in circulation when it could be used to expand production and

9846

reduce the impact of slumps. Needless to say, the Federal Reserve system

9847

in the USA was far from the institution these populists wanted (after all,

9848

it is run by and for the elite interests who desired its creation).

9849

9850

That the laissez-faire system was so volatile and panic-ridden suggests

9851

that "anarcho"-capitalist dreams of privatising everything, including

9852

banking, and everything will be fine are very optimistic at best (and,

9853

ironically, it was members of the capitalist class who lead the movement

9854

towards state-managed capitalism in the name of "sound money").

9855

9856

11 What is the myth of "Natural Law"?

9857

9858

Natural Law, and the related concept of Natural Rights, play an important

9859

part in Libertarian and "anarcho"-capitalist ideology. Right-libertarians

9860

are not alone in claiming that their particular ideology is based on the

9861

"law of nature". Hitler, for one, claimed the same thing for Nazi ideology.

9862

So do numerous other demagogues, religious fanatics, and political

9863

philosophers. However, each likes to claim that only *their* "natural

9864

law" is the "real" one, all the others being subjective impositions. We

9865

will ignore these assertions (they are not arguments) and concentrate

9866

on explaining why natural law, in all its forms, is a myth. In addition,

9867

we will indicate its authoritarian implications.

9868

9869

Instead of such myths anarchists urge people to "work it out for themselves"

9870

and realise that any ethical code is subjective and not a law of nature.

9871

If its a good "code", then others will become convinced of it by your

9872

arguments and their intellect. There is no need to claim its a function

9873

of "man's nature"!

9874

9875

The following books discuss the subject of "Natural Law" in greater depth

9876

and are recommended for a fuller discussion of the issues raised in this

9877

section:

9878

9879

Robert Anton Wilson, _Natural Law_ and L.A. Rollins, _The Myth of

9880

Natural Law_.

9881

9882

We should note that these books are written by people associated, to some

9883

degree, with right-libertarianism and, of course, we should point out that

9884

not all right-libertarians subscribe to "natural law" theories (David

9885

Friedman, for example, does not). However, such a position seems to be

9886

the minority in right-Libertarianism (Ayn Rand, Robert Nozick and Murray

9887

Rothbard, among others, did subscribe to it). We should also point out that

9888

the Individualist Anarchist Lysander Spooner also subscribed to "natural

9889

laws" (which shows that, as we noted above, the concept is not limited to

9890

one particular theory or ideology). We present a short critique of Spooner's

9891

ideas on this subject in section G.7.

9892

9893

Lastly, it could be maintained that it is a common "straw man" to maintain

9894

that supporters of Natural Law argue that their Laws are like the laws of

9895

physics (and so are capable of stopping people's actions just as the law

9896

of gravity automatically stops people flying from the Earth). But that is

9897

the whole point -- using the term "Natural Law" implies that the moral

9898

rights and laws that its supporters argue for are to be considered just

9899

like the law of gravity (although they acknowledge, of course, that unlike

9900

gravity, *their* "natural laws" *can be violated in nature*). Far from

9901

saying that the rights they support are just that (i.e. rights *they* think

9902

are good) they try to associate them with universal facts. For example,

9903

Lysander Spooner (who, we must stress, used the concept of "Natural law"

9904

to *oppose* the transformation of America into a capitalist society, unlike

9905

Rand, Nozick and Rothbard who use it to defend capitalism) stated that:

9906

9907

"the true definition of law is, that it is a fixed, immutable, natural

9908

principle; and not anything that man ever made, or can make, unmake, or

9909

alter. Thus we speak of the laws of matter, and the laws of mind; of the

9910

laws of gravitation, the laws of light, heat, and electricity. . .etc.,

9911

etc. . . . The law of justice is just as supreme and universal in the moral

9912

world, as these others are in the mental or physical world; and is as

9913

unalterable as are these by any human power. And it is just as false

9914

and absurd to talk of anybody's having the power to abolish the law of

9915

justice, and set up their own in its stead, as it would be to talk of

9916

their having the power to abolish the law of gravitation, or any other

9917

natural laws of the universe, and set up their own will in the place of

9918

them." [_A Letter to Grover Cleveland_, p. 88]

9919

9920

Rothbard and other capitalist supporters of "Natural Law" make the same sort

9921

of claims (as we will see). Now, why, if they are aware of the fact that

9922

unlike gravity their "Natural Laws" can be violated, do they use the term

9923

at all? Benjamin Tucker said that "Natural Law" was a "religious" concept

9924

I will get cross" does not have *quite* the same power as "Do not violate

9925

these rights, they are facts of natural and you are violating nature"

9926

(compare to "Do not violate these laws, or you will go to hell"). So to

9927

point out that "Natural Law" is *not* the same as the law of gravity

9928

(because it has to be enforced by humans) is not attacking some kind of

9929

"straw man" -- it is exposing the fact that these "Natural Laws" are just

9930

the personal prejudices of those who hold them. If they do not want then

9931

to be exposed as such then they should call their laws what they are

9932

of nature.

9933

9934

11.1 Why the term "Natural Law" in the first place?

9935

9936

Murray Rothbard claims that "Natural Law theory rests on the insight. . .

9937

that each entity has distinct and specific properties, a distinct 'nature,'

9938

which can be investigated by man's reason" [_For a New Liberty_, p. 25]

9939

and that "man has rights because they are *natural* rights. They are

9940

grounded in the nature of man." [_The Ethics of Liberty_, p. 155]

9941

9942

To put it bluntly, this form of "analysis" was originated by Aristotle

9943

and has not been used by science for centuries. Science investigates by

9944

proposing theories and hypotheses to explain empirical observations,

9945

testing and refining them by experiment. In stark contrast, Rothbard

9946

*invents* definitions ("distinct" "natures") and then draws conclusions

9947

from them. Such a method was last used by the medieval Church and is

9948

devoid of any scientific method. It is, of course, a fiction. It

9949

attempts to deduce the nature of a "natural" society from a priori

9950

considerations of the "innate" nature of human beings, which just means

9951

that the assumptions necessary to reach the desired conclusions have been

9952

built into the definition of "human nature." In other words, Rothbard

9953

defines humans as having the "distinct and specific properties" that,

9954

given his assumptions, will allow his dogma (private state capitalism)

9955

to be inferred as the "natural" society for humans.

9956

9957

Rothbard claims that "if A, B, C, etc., have differing attributes, it

9958

follows that they have different *natures.*" [_The Ethics of Liberty_,

9959

p. 9] Does this means that as every individual is unique (have different

9960

attributes), they have different natures? Skin and hair colour are

9961

different attributes, does this mean that red haired people have

9962

different natures than blondes? That black people have different natures

9963

than white (and such a "theory" of "natural law" was used to justify slavery

9964

masters and so slavery is okay). Of course Rothbard aggregates "attributes"

9965

to species level, but why not higher? Humans are primates, does that mean

9966

we have the same natures are monkeys or gorillas? We are also mammals as

9967

well, we share many of the same attributes as whales and dogs. Do we

9968

have similar natures?

9969

9970

But this is by the way. To continue we find that after defining certain

9971

"natures," Rothbard attempts to derive "Natural Rights and Laws" from

9972

them. However, these "Natural Laws" are quite strange, as they can be

9973

violated in nature! Real natural laws (like the law of gravity) *cannot*

9974

be violated and therefore do not need to be enforced. The "Natural Laws"

9975

the "Libertarian" desires to foist upon us are not like this. They need

9976

to be enforced by humans and the institutions they create. Hence, Libertarian

9977

"Natural Laws" are more akin to moral prescriptions or juridical laws.

9978

However, this does not stop Rothbard explicitly "plac[ing]" his "Natural

9979

Laws" "alongside physical or 'scientific' natural laws." [_The Ethics of

9980

Liberty_, p. 42]

9981

9982

So why do so many Libertarians use the term "Natural Law?" Simply, it gives

9983

them the means by which to elevate their opinions, dogmas, and prejudices to

9984

a metaphysical level where nobody will dare to criticise or even think about

9985

them. The term smacks of religion, where "Natural Law" has replaced

9986

"God's Law." The latter fiction gave the priest power over believers.

9987

"Natural Law" is designed to give the Libertarian ideologist power over

9988

the people that he or she wants to rule.

9989

9990

How can one be against a "Natural Law" or a "Natural Right"? It is

9991

impossible. How can one argue against gravity? If private property,

9992

for example, is elevated to such a level, who would dare argue against

9993

it? Ayn Rand listed having landlords and employers along with "the laws

9994

of nature." They are *not* similar: the first two are social relationships

9995

which have to be imposed by the state; the "laws of nature" (like gravity,

9996

needing food, etc.) are *facts* which do not need to be imposed. Rothbard

9997

claims that "the natural fact is that labour service *is* indeed a

9998

commodity." [Op. Cit., p. 40] However, this is complete nonsense --

9999

labour service as a commodity is a *social* fact, dependent on the

10000

distribution of property within society, its social customs and so

10001

forth. It is only "natural" in the sense that it exists within a given

10002

society (the state is also "natural" as it also exists within nature at

10003

a given time). But neither wage slavery or the state is "natural" in

10004

the sense that gravity is natural or a human having two arms is. Indeed,

10005

workers at the dawn of capitalism, faced with selling their labour services

10006

to another, considered it as decidedly "unnatural" and used the term

10007

"wage slavery" to describe it!

10008

10009

Thus, where and when a "fact" appears is essential. For example, Rothbard

10010

claims that "[a]n apple, let fall, will drop to the ground; this we all

10011

observe and acknowledge to be *in the nature* of the apple." [_The Ethics

10012

of Liberty_, p. 9] Actually, we do not "acknowledge" anything of the kind.

10013

We acknowledge that the apple was subject to the force of gravity and that is

10014

why it fell. The same apple, "let fall" in a space ship would *not* drop

10015

to the floor. Has the "nature" of the apple changed? No, but the situation

10016

it is in has. Thus any attempt to generate abstract "natures" requires

10017

you to ignore reality in favour of ideals.

10018

10019

Because of the confusion its usage creates, we are tempted to think

10020

that the use of "Natural Law" dogma is an attempt to *stop* thinking,

10021

to restrict analysis, to force certain aspects of society off the

10022

political agenda by giving them a divine, everlasting quality.

10023

10024

Moreover, such an "individualist" account of the origins of rights will

10025

always turn on a muddled distinction between individual rationality and

10026

some vague notion of rationality associated with membership of the

10027

human species. How are we to determine what is rational for an individual

10028

*as and individual* and what is rational for that same individual *as a

10029

human being*? It is hard to see that we can make such a distinction for

10030

"[i]f I violently interfere with Murray Rothbard's freedom, this may

10031

violate the 'natural law' of Murray Rothbard's needs, but it doesn't

10032

violate the 'natural law' of *my* needs." [L.A. Rollins, _The Myth of

10033

Natural Rights_, p. 28] Both parties, after all, are human and if such

10034

interference is, as Rothbard claims, "antihuman" then why? "If it helps

10035

me, a human, to advance my life, then how can it be unequivocally

10036

'antihuman'?" [L. A. Rollins, Op. Cit., p. 27] Thus "natural law" is

10037

contradictory as it is well within the bounds of human nature to violate

10038

it.

10039

10040

This means that in order to support the dogma of "Natural Law," the cultists

10041

*must* ignore reality. Ayn Rand claims that "the source of man's rights

10042

is. . .the law of identity. A is A -- and Man is Man." But Rand (like

10043

Rothbard) *defines* "Man" as an "entity of a specific kind -- a rational

10044

being" [_The Virtue of Selfishness_, pp. 94-95]. Therefore she cannot

10045

account for *irrational* human behaviours (such as those that violate

10046

"Natural Laws"), which are also products of our "nature." To assert that

10047

such behaviours are not human is to assert that A can be not-A, thus

10048

contradicting the law of identity. Her ideology cannot even meet its

10049

own test.

10050

10051

11.2 But "Natural Law" provides protection for individual rights from

10052

violation by the State. Those who are against Natural Law desire

10053

total rule by the state.

10054

10055

The second statement represents a common "Libertarian" tactic. Instead of

10056

addressing the issues, they accuse an opponent of being a "totalitarian"

10057

(or the less sinister "statist"). In this way, they hope to distract

10058

attention from, and so avoid discussing, the issue at hand (while at the

10059

same time smearing their opponent). We can therefore ignore the second

10060

statement.

10061

10062

Regarding the first, "Natural Law" has *never* stopped the rights of

10063

individuals from being violated by the state. Such "laws" are as much use

10064

as a chocolate fire-guard. If "Natural Rights" could protect one from the

10065

power of the state, the Nazis would not have been able to murder six

10066

million Jews. The only thing that stops the state from attacking people's

10067

rights is individual (and social) power -- the ability and desire to

10068

protect oneself and what one considers to be right and fair. As the

10069

anarchist Rudolf Rocker pointed out, "Political [or individual] rights

10070

do not exist because they have been legally set down on a piece of paper,

10071

but only when they have become the ingrown habit of a people, and when any

10072

attempt to impair them will be meet with the violent resistance of the

10073

populace. . . .One compels respect from others when he knows how to

10074

defend his dignity as a human being. . . .The people owe all the

10075

political rights and privileges which we enjoy today, in greater or

10076

lesser measure, not to the good will of their governments, but to their

10077

own strength." [_Anarcho-Syndicalism_, p. 64]

10078

10079

Of course, if is there are no "Natural Rights," then the state has no

10080

"right" to murder you or otherwise take away what are commonly regarded as

10081

human rights. One can object to state power without believing in "Natural

10082

Law."

10083

10084

11.3 Why is "Natural Law" authoritarian?

10085

10086

Rights, far from being fixed, are the product of social evolution and

10087

human action, thought and emotions. What is acceptable now may become

10088

unacceptable in the future. Slavery, for example, was long considered

10089

"natural." In fact, John Locke, the "father" of "Natural Rights," was

10090

heavily involved in the slave trade. He made a fortune in violating what

10091

is today regarded as a basic human right: not to be enslaved. Many in

10092

Locke's day claimed that slavery was a "Natural Law." Few would say so

10093

now.

10094

10095

Thomas Jefferson indicates exactly why "Natural Law" is authoritarian

10096

when he wrote "[s]ome men look at constitutions with sanctimonious

10097

reverence, and deem them like the ark of the Covenant, too sacred to be

10098

touched. They ascribe to the men of the preceding age a wisdom more

10099

than human, and suppose what they did to be beyond amendment. . .laws and

10100

institutions must go hand in hand with the progress of the human mind. . .

10101

as that becomes more developed, more enlightened, as new discoveries are

10102

made, institutions must advance also, to keep pace with the times. . .

10103

We might as well require a man to wear still the coat which fitted him

10104

when a boy as civilised society to remain forever under the regimen

10105

of their barbarous ancestors."

10106

10107

The "Natural Law" cult desires to stop the evolutionary process by which

10108

new rights are recognised. Instead they wish to fix social life into

10109

what *they* think is good and right, using a form of argument that tries

10110

to raise their ideology above critique or thought. Such a wish is opposed

10111

to the fundamental feature of liberty: the ability to think for oneself.

10112

Michael Bakunin writes "the liberty of man consists solely in this: that

10113

he obeys natural laws because he has *himself* recognised them as such,

10114

and not because they have been externally imposed upon him by any

10115

extrinsic will whatever, divine or human, collective or individual."

10116

[_Bakunin on Anarchism_, p. 227]

10117

10118

Thus anarchism, in contrast to the "natural law" cult, recognises that

10119

"natural laws" (like society) are the product of individual evaluation of

10120

reality and social life and are, therefore, subject to change in the light

10121

of new information and ideas (Society "progresses slowly through the moving

10122

power of individual initiative" [Bakunin, _The Political Philosophy of

10123

Bakunin_, p. 166] and so, obviously, do social rights and customs). Ethical

10124

or moral "laws" (which is what the "Natural Law" cult is actually about)

10125

is not a product of "human nature" or abstract individuals. Rather, it is

10126

a *social* fact, a creation of society and human interaction. In Bakunin's

10127

words, "moral law is not an individual but a social fact, a creation of

10128

society" and any "natural laws" are "inherent in the social body" (and so,

10129

we must add, not floating abstractions existing in "man's nature"). [Ibid.,

10130

p. 125, p. 166]

10131

10132

The case for liberty and a free society is based on the argument that,

10133

since every individual is unique, everyone can contribute something that

10134

no one else has noticed or thought about. It is the free interaction of

10135

individuals which allows them, along with society and its customs and

10136

rights, to evolve, change and develop. "Natural Law," like the state,

10137

tries to arrest this evolution. It replaces creative inquiry with dogma,

10138

making people subject to yet another god, destroying critical thought with

10139

a new rule book.

10140

10141

In addition, if these "Natural Laws" are really what they are claimed

10142

to be, they are necessarily applicable to *all* of humanity (Rothbard

10143

explicitly acknowledges this when he wrote that "one of the notable

10144

attributes of natural law" is "its applicability to all men, regardless

10145

of time or place" [_The Ethics of Liberty_, p. 42]). In other words,

10146

every other law code *must* (by definition) be "against nature" and

10147

there exists *one* way of life (the "natural" one). The authoritarian

10148

implications of such arrogance is clear. That the Dogma of Natural Law was

10149

only invented a few hundred years ago, in one part of the planet, does not

10150

seem to bother its advocates. Nor does the fact that for the vast majority

10151

of human existence, people have lived in societies which violated almost

10152

*all* of their so-called "Natural Laws" To take one example, before the

10153

late Neolithic, most societies were based on usufruct, or free access

10154

to communally held land and other resources (see Murray Bookchin, _The

10155

Ecology of Freedom_). Thus for millennia, all human beings lived in

10156

violation of the supposed "Natural Law" of private property -- perhaps

10157

the chief "law" in the "Libertarian" universe.

10158

10159

If "Natural Law" did exist, then all people would have discovered these

10160

"true" laws years ago. To the contrary, however, the debate is still

10161

going on, with (for example) fascists and "Libertarians" each claiming

10162

"the laws of nature" (and socio-biology) as their own.

10163

10164

11.4 Does "Natural Law" actually provides protection for individual liberty?

10165

10166

But, it seems fair to ask, does "natural law" actually respect individuals

10167

and their rights (i.e. liberty)? We think not. Why?

10168

10169

According to Rothbard, "the natural law ethic states that for man, goodness

10170

or badness can be determined by what fulfils or thwarts what is best for

10171

man's nature." [_The Ethics of Liberty_, p. 10] But, of course, what may

10172

be "good" for "man" may be decidedly *bad* for men (and women). If we

10173

take the example of the sole oasis in a desert (see section 4.2) then,

10174

according to Rothbard, the property owner having the power of life and

10175

death over others is "good" while, if the dispossessed revolt and refuse

10176

to recognise his "property", this is "bad"! In other words, Rothbard's

10177

"natural law" is good for *some* people (namely property owners) while

10178

it can be bad for others (namely the working class). In more general

10179

terms, this means that a system which results in extensive hierarchy

10180

(i.e. *archy*, power) is "good" (even though it restricts liberty for

10181

the many) while attempts to *remove* power (such as revolution and the

10182

democratisation of property rights) is "bad". Somewhat strange logic,

10183

we feel.

10184

10185

However such a position fails to understand *why* we consider coercion to

10186

be wrong/unethical. Coercion is wrong because it subjects an individual

10187

to the will of another. It is clear that the victim of coercion is lacking

10188

the freedom that the philosopher Isaiah Berlin describes in the following

10189

terms:

10190

10191

"I wish my life and decisions to depend on myself, not on external forces

10192

of whatever kind. I wish to be an instrument of my own, not of other

10193

men's, acts of will. I wish to be a subject, not an object; to be moved

10194

by reasons, by conscious purposes, which are my own, not by causes which

10195

affect me, as it were, from outside. I wish to be somebody, not nobody; a

10196

doer -- deciding, not being decided for, self-directed and not acted upon

10197

by external nature or by other mean as if I were a thing, or an animal, or

10198

a slave incapable of playing a human role, that is, of conceiving goals

10199

and policies of my own and realising them." [_Four Essays on Liberty_,

10200

p. 131]

10201

10202

Or, as Alan Haworth points out, "we have to view coercion as a violation

10203

of what Berlin calls *positive* freedom." [_Anti-Libertarianism_, p. 48]

10204

10205

Thus, if a system results in the violation of (positive) liberty by its

10206

very nature -- namely, subject a class of people to the will of another

10207

class (the worker is subject to the will of their boss and is turned

10208

into an order-taker) -- then it is justified to end that system. Yes,

10209

it is "coercion" is dispossess the property owner -- but "coercion" exists

10210

only for as long as they desire to exercise power over others. In other

10211

words, it is not domination to remove domination! And remember it is

10212

the domination that exists in coercion which fuels our hatred of it,

10213

thus "coercion" to free ourselves from domination is a necessary evil

10214

in order to stop far greater evils occurring (as, for example, in the

10215

clear-cut case of the oasis monopoliser).

10216

10217

Perhaps it will be argued that domination is only bad when it is involuntary,

10218

which means that it is only the involuntary nature of coercion that makes

10219

it bad, not the domination it involves. By this argument wage slavery is

10220

not domination as workers voluntarily agree to work for a capitalist (after

10221

all, no one puts a gun to their heads) and any attempt to overthrow

10222

capitalist domination is coercion and so wrong. However, this argument

10223

ignores that fact that *circumstances* force workers to sell their liberty

10224

and so violence on behalf of property owners is not (usually) required --

10225

market forces ensure that physical force is purely "defensive" in nature.

10226

And as we argued in section 2.2, even Rothbard recognised that the

10227

economic power associated with one class of people being dispossessed

10228

and another empowered by this fact results in relations of domination

10229

which cannot be considered "voluntary" by any stretch of the imagination

10230

(although, of course, Rothbard refuses to see the economic power associated

10231

with capitalism -- when its capitalism, he cannot see the wood for the trees

10232

use of coercion and violence -- see section 8).

10233

10234

Thus, "Natural law" and attempts to protect individuals rights/liberty and

10235

see a world in which people are free to shape their own lives are fatally

10236

flawed if they do not recognise that private property is incompatible with

10237

these goals. This is because the existence of capitalist property smuggles

10238

in power and so domination (the restriction of liberty, the conversion of

10239

some into order-givers and the many into order-takers) and so Natural Law

10240

does not fulfil its promise that each person is free to pursue their own

10241

goals. The unqualified right of property will lead to the domination and

10242

degradation of large numbers of people (as the oasis monopoliser so

10243

graphically illustrates).

10244

10245

And we stress that anarchists have no desire to harm individuals, only to

10246

change institutions. If a workplace is taken over by its workers, the owners

10247

are not harmed physically. If the oasis is taken from the monopoliser, the

10248

ex-monopoliser becomes like other users of the oasis (although probably

10249

*disliked* by others). Thus anarchists desire to treat people as fairly as

10250

possible and not replace one form of coercion and domination with another --

10251

individuals must *never* be treated as abstractions (if they have

10252

power over you, destroy what creates the relation of domination, *not*

10253

the individual, in other words! And if this power can be removed without

10254

resorting to force, so much the better -- a point which social and

10255

individualist anarchists disagree on, namely whether capitalism can

10256

be reformed away or not comes directly from this. As the Individualists

10257

think it can, they oppose the use of force. Most social anarchists think

10258

it cannot, and so support revolution).

10259

10260

This argument may be considered as "utilitarian" (the greatest good for

10261

the greatest number) and so treats people not as "ends in themselves"

10262

but as "means to an end". Thus, it could be argued, "natural law" is

10263

required to ensure that *all* (as opposed to some, or many, or the

10264

majority of) individuals are free and have their rights protected.

10265

10266

However, it is clear that "natural law" can easily result in a minority

10267

having their freedom and rights respected, while the majority are

10268

forced by circumstances (created by the rights/laws produced by applying

10269

"natural law" we must note) to sell their liberty and rights in order

10270

to survive. If it is wrong to treat anyone as a "means to an end",

10271

then it is equally wrong to support a theory or economic system that

10272

results in people having to negate themselves in order to live. A respect

10273

for persons -- to treat them as ends and never as means -- is not compatible

10274

with private property.

10275

10276

The simple fact is that *there are no easy answers* -- we need to weight

10277

up our options and act on what we think is best. Yes, such subjectivism

10278

lacks the "elegance" and simplicity of "natural law" but it reflects

10279

real life and freedom far better. All in all, we must always remember

10280

that what is "good" for man need not be good for people. "Natural law"

10281

fails to do this and stands condemned.

10282

10283

11.5 But Natural Law was discovered, not invented!

10284

10285

This statement truly shows the religious nature of the Natural Law cult.

10286

To see why its notion of "discovery" is confused, let us consider the Law

10287

of Gravity. Newton did not "discover" the law of gravity, he invented a

10288

theory which explained certain observed phenomena in the physical world.

10289

Later Einstein updated Newton's theories in ways that allowed for a better

10290

explanation of physical reality. Thus, unlike "Natural Law," scientific

10291

laws can be updated and changed as our knowledge changes and grows. As

10292

we have already noted, however, "Natural Laws" cannot be updated because

10293

they are derived from fixed definitions (Rothbard is pretty clear on this,

10294

he states that it is "[v]ery true" that natural law is "universal, fixed and

10295

immutable" and so are "'absolute' principles of justice" and that they are

10296

"independent of time and place" [_The Ethics of Liberty_, p. 19]). However,

10297

what he fails to understand is that what the "Natural Law" cultists are

10298

"discovering" are simply the implications of their own definitions, which

10299

in turn simply reflect their own prejudices and preferences.

10300

10301

Since "Natural Laws" are thus "unchanging" and are said to have been

10302

"discovered" centuries ago, it's no wonder that many of its followers look

10303

for support in socio-biology, claiming that their "laws" are part of the

10304

genetic structure of humanity. But socio-biology has dubious scientific

10305

credentials for many of its claims. Also, it has authoritarian implications

10306

*exactly* like Natural Law. Murray Bookchin rightly characterises

10307

socio-biology as "suffocatingly rigid; it not only impedes action with the

10308

autocracy of a genetic tyrant but it closes the door to any action that is

10309

not biochemically defined by its own configuration. When freedom is

10310

nothing more than the recognition of necessity. . .we discover the gene's

10311

tyranny over the greater totality of life. . .when knowledge becomes

10312

dogma (and few movements are more dogmatic than socio-biology) freedom is

10313

ultimately denied." ["Socio-biology or Social Ecology", in _Which way for

10314

the Ecology Movement?_ pp. 49 - 75, p. 60]

10315

10316

In conclusion the doctrine of Natural Law, far from supporting individual

10317

freedom, is one of its greatest enemies. By locating individual rights

10318

within "Man's Nature," it becomes an unchanging set of dogmas. Do we really

10319

know enough about humanity to say what are "Natural" and universal Laws,

10320

applicable forever? Is it not a rejection of critical thinking and thus

10321

individual freedom to do so?

10322

10323

11.6 Why is the notion of "discovery" contradictory?

10324

10325

Ayn Rand indicates the illogical and contradictory nature of the concepts

10326

of "discovering" "natural law" and the "natural rights" this "discovery"

10327

argument creates when she stated that her theory was "objective." Her

10328

"Objectivist" political theory "holds that good is neither an attribute of

10329

'things in themselves' nor man's emotional state, but *an evaluation* of

10330

the facts of reality by man's consciousness according to a rational standard

10331

of value. . . The objective theory holds that *the good is an aspect of

10332

reality in relation to man* - and that it must be discovered, not invented,

10333

by man." [_Capitalism: The Unknown Ideal_, p. 22]

10334

10335

However, this is playing with words. If something is "discovered" then it

10336

has always been there and so is an intrinsic part of it. If "good" *is*

10337

"discovered" by "man" then "good" exists independently of people -- it

10338

is waiting to be "discovered." In other words, "good" is an attribute of

10339

"man as man," of "things in themselves" (in addition, such a theory also

10340

implies that there is just *one* possible interpretation of what is "good"

10341

for all humanity). This can be seen when Rand talks about her system of

10342

"objective" values and rights.

10343

10344

When discussing the difference between "subjective," "intrinsic" and

10345

"objective" values Rand noted that "intrinsic" and "subjective" theories

10346

"make it possible for a man to believe what is good is independent of man's

10347

mind and can be achieved by physical force." [Op. Cit., p. 22] In other

10348

words, intrinsic and subjective values justify tyranny. However, her

10349

"objective" values are placed squarely in "Man's Nature" -- she states that

10350

"[i]ndividual rights are the means of subordinating society to moral law"

10351

and that "the source of man's rights is man's nature." [Op. Cit., p. 320,

10352

p. 322]

10353

10354

She argues that the "*intrinsic* theory holds that the good is inherent

10355

in certain things or actions, as such, regardless of their context and

10356

consequences, regardless of any benefit or injury they may cause to the

10357

actors and subjects involved." [Op. Cit., p. 21] According to the _Concise

10358

Oxford Dictionary_, "intrinsic" is defined as "inherent," "essential,"

10359

"belonging naturally" and defines "nature" as "a thing's, or person's,

10360

innate or essential qualities or character." In other words, if, as

10361

Rand maintains, man's rights *are* the product of "man's nature" then

10362

such rights are *intrinsic*! And if, as Rand maintains, such rights

10363

are the "extension of morality into the social system" then morality

10364

itself is also intrinsic.

10365

10366

Again, her ideology fails to meet its own tests -- and opens the way for

10367

tyranny. This can be seen by her whole hearted support for wage slavery and

10368

her total lack of concern how it, and concentrations of wealth and power,

10369

affect the individuals subjected to them. For, after all, what is "good"

10370

is "inherent" in capitalism, regardless of the context, consequences,

10371

benefits or injuries it may cause to the actors and subjects involved.

10372

10373

The key to understanding her contradictory and illogical ideology lies in

10374

her contradictory use of the word "man." Sometimes she uses it to describe

10375

individuals but usually it is used to describe the human race collectively

10376

("man's nature," "man's consciousness"). But "Man" does not have a

10377

consciousness, only individuals do. Man is an abstraction, it is individuals

10378

who live and think, not "Man." Such "Man worship" -- like Natural Law --

10379

has all the markings of a religion.

10380

10381

As Max Stirner argues "liberalism is a religion because it separates my

10382

essence from me and sets it above me, because it exalts 'Man' to the same

10383

extent as any other religion does to God. . . it sets me beneath Man."

10384

[_The Ego and Its Own_, p. 176] Indeed, he "who is infatuated with *Man*

10385

leaves persons out of account so far as that infatuation extends, and floats

10386

in an ideal, sacred interest. *Man*, you see, is not a person, but an ideal,

10387

a spook." [Op. Cit., p.79]

10388

10389

Rand argues that we must evaluate "the facts of reality by man's consciousness

10390

according to a rational standard of value" but who determines that value?

10391

She states that "[v]alues are not determined by fiat nor by majority vote"

10392

[p. 24] but, however, neither can they be determined by "man" or "man's

10393

consciousness" because "man" does not exist. Individuals exist and have

10394

consciousness and because they are unique have different values (but as we

10395

argued in section A.2.19, being social creatures these values are generalised

10396

across individuals into social, i.e. objective, values). So, the abstraction

10397

"man" does not exist and because of this we see the healthy sight of

10398

different individuals convincing others of their ideas and theories

10399

by discussion, presenting facts and rational debate. This can be best

10400

seen in scientific debate.

10401

10402

The aim of the scientific method is to invent theories that explain facts,

10403

the theories are not part of the facts but created by the individual's mind

10404

in order to explain those facts. Such scientific "laws" can and do change

10405

in light of new information and new thought. In other words, the scientific

10406

method is the creation of subjective theories that explain the objective

10407

facts. Rand's method is the opposite - she assumes "man's nature," "discovers"

10408

what is "good" from those assumptions and draws her theories by deduction

10409

from that. This is the *exact* opposite of the scientific method and, as we

10410

noted above, comes to us straight from the Roman Catholic church.

10411

10412

It is the subjective revolt by individuals against what is considered

10413

"objective" fact or "common sense" which creates progress and develops

10414

ethics (what is considered "good" and "right") and society. This, in

10415

turn, becomes "accepted fact" until the next free thinker comes along and

10416

changes how we view the world by presenting *new* evidence, re-evaluating

10417

old ideas and facts or exposing the evil effects associated with certain

10418

ideas (and the social relationships they reflect) by argument, fact and

10419

passion. Attempts to impose "an evaluation of the facts of reality by man's

10420

consciousness" would be a death blow to this process of critical thought,

10421

development and evaluation of the facts of reality by individual's

10422

consciousness. Human thought would be subsumed by dogma.

10423