Agorism and Nazism: A Study in Polar Opposites

In the Gorilla Experiment episode of the Big Bang Theory, Dr. Sheldon Cooper attempts to teach Penny some rudimentary physics. True to his pedantic nature, Sheldon begins his sketch of the history of physics by mentioning the agora, from which we get the modern term agorism. Following Samuel Edward Konkin III’s (SEK III’s) An Agorist Primer, the word “agora” is still used to this day to mean simply the “open marketplace.”

To the modern agorist, the agora or uncorrupted free marketplace is the goal; the means of going from the current statism to the agora is called “counter-economics.” “All non-coercive human action committed in defiance of the State constitutes the Counter-Economy,” according to SEK III in his book An Agorist Primer. He mentions some specific examples of what is meant by non-coercive action in defiance of the State:

  • Tax evasion
  • Inflation avoidance
  • Smuggling
  • Free production
  • Illegal distribution
  • The free flow of both labor (“illegal aliens”) and capital across borders
  • Information and secrecy of that information
  • And many more

The general idea of counter-economics is very similar to what Robert Neuwirth calls System D as reported in an interview called Why Black Market Entrepreneurs Matter to the World Economy. Neuwirth says that

there’s a French word for someone who’s self-reliant or ingenious: débrouillard…the street economy…l’économie de la débrouillardise—the self-reliance economy, or the DIY economy if you will. I decided to use this term myself—shortening it to System D—because it’s a less pejorative way of referring to what has traditionally been called the informal economy or black market or even underground economy. I’m basically using the term to refer to all the economic activity that flies under the radar of government. So, unregistered, unregulated, untaxed, but not outright criminal—I don’t include gun-running, drugs, human trafficking, or things like that. (bold emphasis mine)

Nevertheless, the reason why I want to mention System D is because it helps me starkly illustrate that in the final analysis what is being discussed here is simply human survival. This is a discussion that, without being hyperbolic, does touch upon life-and-death issues. To make this unexceptionable point crystal clear, Neuwirth, in his book The Stealth of Nations, mentions how System D has helped people survive the financial crisis:

A 2009 study by Deutsche Bank, the huge German commercial lender, suggested that people in the European countries with the largest portions of their economies that were unlicensed and unregulated—in other words, citizens of the countries with the most robust System D—fared better in the economic meltdown of 2008 than folks living in centrally planned and tightly regulated nations.

He further illustrates the survival issue with an example from Latin America:

Studies of countries throughout Latin America have shown that desperate people turned to System D to survive during the most recent financial crisis. This spontaneous system, ruled by the spirit of organized improvisation, will be crucial for the development of cities in the twenty-first century. (bold emphasis mine)

Perhaps one of the most impressive examples of the counter-economics idea in action is that of what businesspeople did in order to evade the price control laws of Nazi Germany. It also gives me the opportunity to bring to light an issue that seems to be neglected; nevertheless, it does play an important role in undermining the establishment of state sovereignty. In a truly brilliant passage found in his book The Art of Not Being Governed: An Anarchist History of Upland Southeast Asia, James C. Scott mentions that shifting of linguistic practices is vital for state evasion and for state prevention:

State rulers find it well nigh impossible to install an effective sovereignty over people who are constantly in motion, who have no permanent pattern of organization, no permanent address, whose leadership is ephemeral, whose subsistence patterns are pliable and fugitive, who have few permanent allegiances, and who are liable, over time, to shift their linguistic practices and their ethnic identity. And this is just the point! The economic, political, and cultural organization of such people is, in large part, a strategic adaptation to avoid incorporation in state structures. (all emphasis is mine)

With that prologue now out of the way, let me get to my main point: that the behavior of some businesspeople (I cannot say all because it is fairly easy to demonstrate that some businesspeople wanted fascism or even created it) acted as perfect textbook examples of agorists evading the Nazi price controls introduced in 1936.

In his book The Vampire Economy: Doing Business under Fascism, Günter Reimann, much like James C. Scott, emphasizes the importance of permanent change—or subversion of “standardization”—as a key method for evading the will of the State. Conformity truly is the jailer of the world. Reimann notes that

manufacturers may introduce changes in standardized products which result in making the finished article more complicated, solely for the purpose of enabling the manufacturer to claim that the finished product is a “new article,” which will not be subject to the old price restrictions. The State is enforcing more standardization of production in order to save raw materials; manufacturers must do exactly the reverse in order to defend their private interests. (bold emphasis mine)

To further evade the State’s price control system, buyers and sellers would set up these “combination deals” that amounted to selling scarce resources for a higher price while “tricking” the State into thinking that one was following the prescribed price orders. I want to reproduce in full Reimann’s story about how the buyers and sellers executed this legerdemain because it illustrates an actual way of appearing to be “legitimate” while actually being the complete opposite:

A peasant was arrested and put on trial for having repeatedly sold his old dog together with a pig. When a private buyer of pigs came to him, a sale was staged according to the official rules. The buyer would ask the peasant: “How much is the pig?” The cunning peasant would answer: “I cannot ask you for more than the official price. But how much will you pay for my dog which I also want to sell?” Then the peasant and the buyer of the pig would no longer discuss the price of the pig, but only the price of the dog. They would come to an understanding about the price of the dog, and when an agreement was reached, the buyer got the pig too. The price for the pig was quite correct, strictly according to the rules, but the buyer had paid a high price for the dog. Afterward, the buyer, wanting to get rid of the useless dog, released him, and he ran back to his old master for whom he was indeed a treasure.

In the end, the peasant never actually sells his dog since the buyer effectively gives the dog back to him by releasing the dog. The buyer gets the pig, which is the official side of this transaction, but the seller gets to keep the official price for the pig plus the phantom dog sale price, thus the seller gets a price above the State mandated price for selling his pig.

Naturally, the State is going to try to crackdown on such prestidigitation, a fancy word for any sneaky sleight of hand behavior. Being Nazi Germany, the State’s response was quite predictable. According to Reimann, the State used “control purchases” in order to catch people for audaciously circumventing its price rules. What exactly were Nazi “control purchases”? They consisted of the following:

  • Secret police agents
  • The secret police agents would be plainclothes officers and would pose as harmless buyers, but willing to offer a higher price than the official price
  • The secret police agents would then try to induce businesspeople to make an illegal transaction with them

To me this sounds like a drug sting operation but for such prosaic items as selling pigs! A pig sting! (That has double entendre written all over it.)

In order to avoid getting caught, the idea of shifting one’s linguistic practices comes into play among those engaged in productive activity. Reimann points out explicitly that when applying agorism, one must learn to speak a new language:

In order to discuss illegal business transactions in a manner that makes them seem legal, businessmen in fascist countries learn to speak the language of experienced underground adversaries of the regime. They are often uncertain as to whether a prospective buyer is “reliable” and therefore talk in terms which are innocent and the meaning of which can be interpreted in different ways. (bold emphasis mine)

In conclusion, I think that one possible way to “market” agorism to people who are currently not agorists is to show that the underlying ideas have a long and honorable history. I have tried to illustrate this by using both a recent and a historical example. In the recent example, i.e., the current financial crisis, agorism and System D have helped desperate people on multiple continents earn a living and stay alive. Agorism and System D thus are helping people survive. The compare and contrast is blatantly obvious: the greedy ruling class caused the problem through their central bank monetary policies but the agorists provided the solution and it is working in practice. The Nazi example demonstrates that agorism is a tool for undermining a totalitarian regime. Once again, agorism can position itself as being on the side of humanity against some of its most monstrous enemies. And how did our pig buyer and pig seller do it: through a negotiated exchange in which both parties came to an acceptable agreement. In other words, voluntary exchange subverts totalitarianism once again.

Anarchy and Democracy
Fighting Fascism
Markets Not Capitalism
The Anatomy of Escape
Organization Theory