Like Hodgskin, today’s market anarchists do not object to the mere fact that capital is compensated for its part in the process of production. The worry — which can only finally be allayed by observing a now hypothetical free market and finding out — is that capital is overcompensated due to a position of privilege which the State confers on it. “One is almost tempted to believe,” wrote Hodgskin, “that capital is a sort of cabalistic word, like Church or State, or any other of those general terms which are invented by those who fleece the rest of mankind to conceal the hand that shears them. It is a sort of idol before which men are called upon to prostrate themselves . . . .”
Among Hodgskin’s central insights, habitually overlooked by most free marketers, is the idea that the fact of exchange in and of itself does not prove the absence of exploitation. Unequal exchange is exploitative insofar as one party to the exchange has an unfair advantage, one gained from the coercive prevention or restriction of competition. Considered on the micro level, unequal exchange might manifest in, for example, the employment relationship or an agreement for consumer goods or services. On a larger scale, unequal exchange analyses may aid our understanding of the way that the poor, developing world interacts economically with the rich and developed West.
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