The Problem of Structure

What would the constitution of a free nation look like? In trying to answer that question we immediately think in terms of a Bill of Rights, restrictions on governmental power, and so forth. And any constitution worth having would certainly include those things. But if a constitution is to be more than a wish list, it must also specify the political structure necessary to ensure that these freedoms are not eroded or ignored. Consider the old Soviet Constitution, which guaranteed all sorts of fine-sounding freedoms for its citizens — but which in practice proved only an empty promise, since its interpretation and enforcement lay in the hands of an unfettered monolithic centralized state.

Framing a constitution is an exercise in public-choice economics; politicians react to incentives, and so the political incentive structure must be designed in such a way that those in authority cannot profit by the aggrandizement of state power.

Such was the intent of the Framers of the U.S. Constitution when they established the Federal system. Each branch of government was expected to be jealous of the others, and so to be motivated to serve as a check on their expansion. At the same time, the broad base of representation was expected to ensure that no special interest could succeed in manipulating the government.

As we have since learned all too well, the experiment eventually proved to be a failure. Madison and his colleagues could not foresee the logrolling process whereby government branches and special interests (“factions”) that were intended to hold one another in perpetual check instead made concessions to one another’s ambitions in exchange for like concessions to their own. Yet some foresaw the danger; one Anti-Federalist poet, bemoaning the recent ratification of the Constitution, wrote:

In five short years, of freedom weary grown,
We quit our plain republics for a throne;
Congress and President full proof shall bring
A mere disguise for Parliament and King.

Thus did the streamlined confederation become the swollen imperial Leviathan.

Decentralize!

Thomas Jefferson wrote many stirring passages about the natural rights of man. But when asked to summarize his political philosophy, he replied that he could state it in one sentence: “Divide the counties into wards.” In other words: decentralize, decentralize, decentralize!

There are many advantages to political decentralization as a structural limitation on government power. Imagine a country the size of the United States, but consisting of only five states. Now imagine the same region containing 500 states. All other things being equal, the second situation is likely to be much more hospitable to freedom than the first. The smaller the political unit, the greater the influence an individual citizen can have in politics, thus decreasing the lobbying advantage that concentrated special interests have over the diffuse general public. Further, as the number of available alternative political jurisdictions increases, the citizen’s exit option becomes more powerful. The freedom to leave one state is small comfort if there are only a handful of others nearby to go to; but with many states, the odds of finding a satisfactory destination are much better.

In addition, competition between states can serve as a check on state power, since if any state becomes too oppressive its citizens can vote with their feet. Also, decentralization softens the impact of government mistakes. If a single centralized government decides to implement some ill-conceived plan, everybody has to suffer. But with many states implementing different policies, a bad policy can be escaped, while a good policy can be imitated. (Here too, competition can serve as a discovery process.) The Federal structure of the United States, imperfect though it is, may well explain why this country has not plunged as rapidly into socialism as its European counterparts — individual states having free entry while most European countries do not. (Fifty states is certainly better than one — though still a far cry from Jefferson’s notion that six square miles was the optimum size for a basic political unit within a republic.) And Switzerland’s even more decentralized canto! n sy stem has doubtless played a similar role in the preservation of Swiss freedom. (Frances Kendall and Leon Louw’s book After Apartheid has helped to bring to the libertarian community’s attention the usefulness of a canton-style system to countries torn by ethnic strife; but its appeal is not limited to such cases.)

Housetrailers and Empty Landscapes

The constitution of a free nation, then, should most likely be characterized by a radically decentralized power structure, along the lines of some sort of canton system. But can the Swiss model be improved on? I think so.

The effectiveness of competition among political jurisdictions is inversely proportional to the costs of changing one’s jurisdiction. Massachusetts faces serious competition from New Hampshire, but little from Alaska, since the costs of voting with one’s feet are so much higher in the second case. (The same is true at the international level; there’s no mystery as to why Cuban and Haitian refugees are trying to get into Miami rather than into Geneva.) And even when the alternative jurisdiction is nearby, the costs of switching are not exactly low. Uprooting oneself and perhaps one’s family in order to move to another state can be costly, both financially and emotionally.

The high cost of switching results from the fact that political jurisdictions correspond to geographical regions, and geographical relocation is not always feasible. Yet a decentralised system serves as a more effective check on the growth of state power to the extent that switching costs are low. Therefore, it seems desirable to decouple political jurisdiction from geographical location.

David Friedman offers an example: “Consider our world as it would be if the costs of moving from one country to another were zero. Everyone lives in a housetrailer and speaks the same language. One day, the president of France announces that because of troubles with neighboring countries, new military taxes are being levied and conscription will begin shortly. The next morning the president of France finds himself ruling a peaceful but empty landscape, the population having been reduced to himself, three generals, and twenty-seven war correspondents.” (Machinery of Freedom, 2nd ed., p. 123.)

If people could switch political jurisdictions without switching location, we would have the functional equivalent of the situation Friedman envisions. Competition among jurisdictions would be higher, and the amount of state interference that people would tolerate without switching would be lower, than in a political system where jurisdiction and geographic location are linked.

The Case of Iceland

There are a number of historical precedents for this idea. To pick one famous example, the Icelandic Free Commonwealth (930-1262) operated on the Thing system. A “Thing” was a court or assembly. (The English word “thing” originally had this meaning also; when Hamlet says “The play’s the thing wherein I’ll catch the conscience of the King,” the pun is successful because in Shakespeare’s time the word “thing” had begun to have its modern meaning, but also still retained the earlier flavor of a judicial proceeding to establish guilt or innocence.) The national legislative assembly, with its attendant national judiciary, was called the All-Thing; beneath it were four Quarter-Things, corresponding to the four geographical regions of Iceland. But here the tie between geography and jurisdiction ended.

Under each Quarter-Thing were three or four Varthings, and assigned to each of these were three Things. Residents of a Quarter were free to choose membership in any of the nine or twelve Things attached (through the Varthings) to their Quarter-Thing. Membership in a Thing determined who your Godhi or chieftain was; a Godhi protected his Thingmen against local threats, appointed judges from his Thing to serve on the judiciary, and represented his Thingmen in the national legislature. In return, a Godhi’s Thingmen paid him fees and did him various favors. One could officially switch one’s membership from one Thing to another simply by making the appropriate announcement in front of witnesses. Since the cost of transferring one’s allegiance to another Godhi was far smaller than it would have been if the Things had been purely territorial entities, competition put a brake on the ability of any Godhi to oppress his Thingmen too severely or to demand excessive favors or tribute. ! This decentralized system appears to have been quite effective. The Icelandic Free Commonwealth did eventually succumb to centralization, but it took three hundred years; the United States took much less.

(For more information on the Icelandic system, see Jesse Byock’s Medieval Iceland, William Miller’s Bloodtaking and Peacemaking, and David Friedman’s “Private Creation and Enforcement of Law: A Historical Case” (Journal of Legal Studies 8, 1979). For a historical survey of similar systems, see Bruce Benson’s Enterprise of Law, and bibliographic essays by Tom Bell and Albert Loan in Humane Studies Review 7, no. 1 (1991/92).)

Virtual Cantons

The Icelandic case has been a popular model among libertarian defenders of market anarchism. But it’s important to see that it offers valuable lessons to framers of governments as well. Within the framework of a state, the divorce of jurisdiction from geography is not an option at the national level; but it remains a very live option at the local level. Just as a nation may be divided into many small geographically distinct cantons for purposes of local government and national representation, so it might also be divided into analogous political units that had no territorial significance. These might be called “virtual cantons.”

Two Functions of Virtual Cantons

Like the Icelandic Things, the virtual cantons would have two functions: representation at the national level, and government at the local level (with “local” now serving as a structural rather than a geographical concept).

In the first case, each virtual canton would send a representative to the national legislature. Citizens would be free to switch their allegiance to another canton whenever they chose, without having to change their residence; so it would be like being able to live in New York and yet choose a Senator from Arizona as one’s representative. Also advisable would be a constitutional provision allowing any group of citizens above a certain size to form a new canton. (The lack of this crucial feature proved to be a fatal flaw in the Icelandic system: since Godhordh, or seats on the legislature, were marketable commodities, it eventually became possible for a small number of families (who had acquired their wealth by being recipients of tithe taxes, which, unlike Godhi fees, divorced income from accountability — a result of Iceland’s forcible conversion to Christianity) to buy up these Godhordh and monopolize the legislature. The Icelandic constitution had no provision for the creation of new Godhordh to counteract this threat.)

On the “local” level, each virtual canton would pass its own laws and provide its own enforcement. Citizens would be subject to the laws of the national legislature and to those of their own canton, but not to those of other cantons. A principal job of the national government would be to regulate relationships among cantons, laying down guidelines for the adjudication of disputes among members of different cantons, resolving conflicts between laws of different cantons, and so forth. But within that nationally-determined framework, there would be free competition among virtual cantons.

Such competition would have many benefits. The threat of losing “customers” would push taxes and wasteful spending far below their current monopoly levels. The presence of alternatives would also lower the incidence of government oppression by linking revenue with accountability. (Imagine, for example, how quickly the LAPD would have lost paying customers after the Rodney King beating if rival law enforcement agencies in the same area had been competing for public support.)

A virtual-canton system is also more fair than a purely majoritarian system. Under majority rule, if 51% of the population favors law X and 49% favors law Y, then law X is imposed on everyone, including the dissenting minority. In short, majority rule creates negative externalities for minorities. A system of virtual cantons would help to internalize these externalities: the minority opposed to law X need not be subjected to it, but may instead join a virtual canton offering law Y. Those in the majority cannot conscript the minority into supporting their projects (or vice versa), but must bear the full costs themselves.

Virtual cantons also provide a better check against local tyranny than do other decentralized systems. In a territorial system, those in a given geographical region may find voting with their feet prohibitively costly, and so must suffer whatever the local government decides to impose; the option to change cantons without changing residency offers the functional equivalent of voting with one’s feet, at a far cheaper rate. In general, virtual cantons would provide far more effective checks and balances than those among the three branches of government in the Federal system, because of the competitive potentialities (to which the Federal system has no analogue) of switching between cantons or creating new ones.

The virtual canton system also solves information problems: would cantons tend to divide at all along geographical boundaries, or not? would they vary greatly in size? how many would there be? Competition would allow the market to determine the optimal answers to meet citizens’ needs.

National Government

The national government has a vital role to play in providing coordination among the policies of the various cantons. Yet it must be severely restricted in its powers, or the whole purpose of decentralization will be defeated. If the national government, rather than the cantons, becomes the chief locus of decision-making, then the competition among jurisdictions will become otiose, and the cantons will degenerate into special interest blocs vying for centralized power. Hence national powers must be more severely constrained (not just by a written wish list, but structurally) than canton powers, in order to force most political disputes down to the canton level (and thus onto the competitive market).

There are a number of ways of doing this: severe term limits, supermajority requirements, a plural executive, etc. One promising suggestion, offered by Robert Heinlein in his novel The Moon is A Harsh Mistress, would be a bicameral legislature: one house requiring a two-thirds vote to pass laws, the other a one-third vote to repeal laws. It might be especially useful to compose the former of canton representatives (thus ensuring maximum participation of various interest groups in the legislative process) and the latter of popularly elected representatives (thus accommodating Isabel Paterson’s principle, in God of the Machine, that any stable political regime must provide an official conduit for the masses to exercise a veto power). A weak central power and thriving virtual cantons could combine the best of anarchy and limited government.

C4SS has teamed up with the Distro of the Libertarian Left. The Distro produces and distribute zines and booklets on anarchism, market anarchist theory, counter-economics, and other movements for liberation. For every copy of Kevin Carson’s “‘Privatization’ or Privateering?” that you purchase through the Distro, C4SS will receive a percentage. Support C4SS with Kevin Carson’s “‘Privatization’ or Privateering?”

$1.00 for the first copy. $0.60 for every additional copy.

“A free market is not a society in which all of soc­i­ety’s functions are performed by private, for-profit business corporations. It’s a society where all fun­c­t­ions are performed by free, voluntary assoc­iat­ions. That means people get whatever services they need by organiz­ing them cooperatively with other willing partici­p­ants, or persuading someone to volunt­ar­ily supply them. And nobody is forced to pay for services they don’t want. . . .

“Capitalists don’t get rich by actually making things or providing services. They get rich by controlling – with the help of the state – the circumstances under which people are allowed to make things or provide services. If they do actually make things or provide services, they do so under carefully con­trolled circumstances where they get their money from involuntary customers who are conscripted into pay­ing by the state, or the state limits the ability of other firms to compete with them. You know, like Halli­b­urton and those military con­tractors. Or the private health insurance people have to buy under Obama­care. Under cap­i­tal­ism, privileged businesses make mon­ey by doing stuff on other people’s nickel. Big busi­ness gets its profits by external­iz­ing its operating expenses on the taxpayer. . . .

“Who cares if a corporation like Halliburton is nominally ‘private’ or ‘public?’ If it makes its money through force, it’s really just a part of the state. . . .”

This article was originally published as “‘Privatization’ or Cor­poratism?” in December 2013, as a syndicated column for the Center for a Stateless Society (c4ss.org).

Kevin A. Carson is a mutualist writer living and working in northwest Arkansas, and the author of several incredibly influential works on contemporary mutualist anarchism, including “The Iron Fist Behind the Invisible Hand,” Studies in Mutualist Political Economy,Organization Theory: A Libertarian Per­spect­ive, The Homebrew Industrial Revolution, and numerous articles and research reports for the Center for a Stateless Society.

C4SS Media presents Natasha Petrova‘s “Walter Block’s Wrong Headed Anti-Unionism,” read by James Tuttle and edited by Nick Ford.

The final aspect to be discussed is whether unionism is compatible with the normative philosophical principles of libertarianism. An emphatic yes is the answer. Left-libertarian market anarchist unionism involves a voluntary association of free and equal workers working together for their freedom from arbitrary employer power. Voluntary association and freedom are core libertarian principles. They most emphatically apply to the working class.

Na segunda, dia 13 de janeiro, dois policiais de Fullerton, na Califórnia, acusados do espancamento até a morte de Kelly Thomas foram inocentados e o promotor anunciou sua decisão de não processar um terceiro policial envolvido. As milhões de pessoas que acompanhavam o deenrolar dos fatos encararam o veredito com incredulidade: como alguém que tinha visto o terrível vídeo em que Thomas era espancado contra a parede de forma brutal com punhos e cassetetes, implorando por sua vida e chamando por seu pai, poderia justificar outra decisão que não “culpados”?

A resposta está num famoso experimento psicológico – a experiência de Milgram -, conduzido em 1961. Conduzido quando ainda se lembrava claramente dos julgamentos de Nuremberg, o experimento levava os sujeitos a acreditar que estavam torturando um colega na sala ao lado (que, na verdade, se tratava de um ator fingindo ser um voluntário e não sofria qualquer dor) com choques elétricos cada vez mais potentes. Seguros de que os cientistas conduzindo o experimento assumiriam toda a responsabilidade pelos atos e impelidos a continuar, o sujeitos continuaram a (pensavam eles) causar mais e mais dor com choques dolorosos nos colegas, mesmo quando os gritos se tornavam cada vez mais altos e depois se silenciavam. Em suma, eram pessoas dispostas a infligir dor em estranhos que imploravam por piedade, ao ponto de perderem a consciência e talvez morrerem, confiando em garantias de “figuras de autoridade responsáveis”, contanto que a vítima fosse enquadrada como alguém de fora.

Psicólogos do desenvolvimento nos dizem que as crianças são introduzidas à socialização com a visão de que a autoridade política é uma extensão da autoridade dos pais. O presidente é visto primariamente como um tipo de mamãe ou papai e o resto do país é a família. Gradualmente, agentes como o Congresso, os tribunais e assim por diante entram no cenário – primeiramente vistos simplesmente como “auxiliares” ao presidente, somente mais tarde como limitadores de sua autoridade. A aura de autoridade parental, porem, persiste num nível subliminar.

A aura contínua de autoridade estimula a tendência a dar a líderes políticos o benefício da dúvida mesmo quando eles iniciam guerras (“devem conhecer informações de que não sabemos”) e a perceber sistemas de autoridade como coisa que exitem por consentimento popular para solucionar problemas comuns (“o governo somos todos nós”). Em nenhum outro lugar esse entimento é mais forte que na visão do policiais inculcada em crianças pequenas. “O policial é seu amigo”. “Se estiver em perigo ou precisar de ajuda, chame um policial”. “Eles deviam estar fazendo algo de errado ou não teriam sido presos”.

Isso tudo, porém, é simplesmente falso. Talvez no passado a polícia tenha sido uma presença benéfica aos bairros e em pequenas cidades, onde os residentes locais conheciam há tempos uns os outros e o policial em ronda (e mesmo neste caso, as coisas podiam não ser tão róseas para mendigos e membros de minorias raciais). Mas hoje em dia a maioria dos policiais de corporações metropolitanas de qualquer tamanho são pessoas que escolheram o trabalho de polícia baseados em suas personalidades autoritárias e em seu desejo de brutalizar os outros; outra parte são pessoas aculturadas à brutalidade após se juntarem às forças policiais, enquanto a maioria daqueles que não se encaixa em nenhuma das primeiras duas categorias aprende a honrar o código de silêncio da farda quando testemunham a brutalidade dos seus “companheiros”.

O que aconteceu com Thomas é um procedimento padrão de operação da polícia em muitas jurisdiçõe: continue a brutalizar alguém que já tenha se tornado fisicamente incapaz de resistência – para além de espasmos involuntários de agonia – enquanto você grita “Pare de resistir! Pare de resistir!”. As polícias locais não passam de impérios sórdidos de criminalidade sustentados por evidências plantadas, armadilhas, testemunhos forçados, confiscos de bens de indivíduos privados e cães treinados para dar alertas falso sob comando. Graças à ampla disponibilidade de equipamentos militares e treinamento cruzado com as forças armadas, os policiais americanos estão militarizados ao ponto de que os times da SWAT são usados para executar buscas de rotina ou mandados de prisão – derrubando portas, atirando em animais domésticos, pilhando casas e aterrorizando famílias na calada da noite como as polícias soviética e nazista. As forças policiais cada vez mais veem os civis como uma população inimiga para ser sujeita a mostras aleatórias de força.

Até que a maioria das pessoas abandone seu respeito pela autoridade uniformizada que foi inculcado pelo estado e sua tendência a tratar pessoas de fora como “o outro”, os vereditos de Rodney King e Kelly Thomas – e tantas outras decisões parecidas, mas desconhecidas – continuarão a acontecer.

Traduzido do inglês para o português por Erick Vasconcelos.

Göran Hugo Olssons nya dokumentär Concerning Violence undersöker kolonialism I Afrika, med massvis med material från svenska nyhetsarkiv, och genom att knyta ihop filmen med Frantz Fanons bok Jordens fördömda från 1961. Utdrag från boken läses up av Lauryn Hill, vars berättande förmedlar Fanons idéer på ett fängslande sätt. Jag såg nyligen filmen på Sundance Film Festival.

Filmen är med avsikt strukturerad som en bok. Som filmens fulla titel Concerning Violence: Nine Scenes From the Anti-Imperialistic Self-Defense låter förstå är den indelat I nio kapitel. Dessa kapitel behandlar en bred uppsättning historier om kolonialism och motstånd.

En scen visar en intervju med en rasist I Rhodesia som är rädd att svarta “terrorister” snart kan komma att ta makten och beklagar att svarta människor uttrycker en strävan efter välstånd och oberoende. En annan följer gerillakämpar som attackerar en Portugisisk militärbas i det territorium som idag kallas Angola. Svenska reportrar pratar med kristna missionärer som jobbar på att påtvinga monogami på afrikanska befolkningar. Rasistiska kolonisatörer och rebelliska infödda filmas båda i länder Afrika runt.

För mig är filmens kraftigaste delar de som belyser det brutala våld och den exploatering som utgör kolonialismens kärna. En särskilt upplysande scen visar en gruvarbetarstrejk vid en europeiskt ägd gruva i Liberia. Den liberianska militären skickades in för att slå ner strejken. Presidenten menade att arbetarna borde helt enkelt borde ha tagit upp sina klagomål med regeringen innan de gick ut i strejk, och att han endast skickade dit trupper för att hindra våld. En av soldaterna intervjuas sen, och beskriver hur han fått order att initiera våld. Det är en avslöjande skildring av hur ekonomisk exploatering och ojämlikhet backas upp av statligt våld.

En annan otroligt viktig scen avbildar hur NATO-trupper försöker stoppa antikoloniala rebeller genom att droppa napalmbomber på hela byar av civila. Trots att de som försvarar sig mot imperialism än idag förses med ”terrorist”-etiketter, var det genom terrorkampanjer västliga krafter upprätthöll kolonial dominans.

Karske är den mest chockerande bilden I filmen en kvinna vars arm har blivit avhackad, så att hon liknar Venus de Milo-statyn. Hon tar hans om sitt barn, som har en liknande skada, i ett sjukhus, med deras motbjudande skador som en stark avbildning av kolonialt våld

Dessa och andra scener knyts ihop av Frantz Fanons ord, utbasunerade som text på skärmen och lästa högt och passionerat av musikern och aktivisten Lauryn Hill. Fanons text berättar hur de infödda drivs till våldsamt motstånd under kolonialismen, om den ekonomiska orättvisan kolonialism främjar, om dehumaniseringen som är inneboende i kolonialismen, om våldet som begås av polisen och militären för koloniala regeringars räkning.

Den här filmen är för kort för att ge tittaren en full bild av kolonialismen. Istället får vi korta vinjetter som visar oss exempel på kolonisering och dekolonisering. Förhoppningsvis lockar detta tittare att lära sig mer om kolonisering, motståndsrörelser, och Fanons verk. Om inte borde den åtminstone ge alla ett hum om vad det är för värld vi lever i: en värld där fängelser, krig och polisvåld möjliggör massiva mängder ekonomisk exploatering, förbrytelser och rasism.

Download: MOLOCH: Mass-Production Industry as a Statist Construct.

I. The Origins of Sloanist Mass Production

A Fork in the Road
A Wrong Turn
The Role of the State in Tipping the Balance

II. The Institutional Imperatives of Sloanism

Economies of Scale, Economies of Speed, and Push Distribution
Microeconomic Institutional Forms for Providing Stability
Mass Consumption to Absorb Surplus
Political Capitalism
State Action to Absorb Surplus: Imperialism
State Action to Absorb Surplus: Creation of New Industries

III. Conclusion

Mass production divorces production from consumption. The rate of production is driven by the imperative of keeping the machines running at full capacity so as to minimize unit costs, rather than by customer orders. So in addition to contractual control of inputs, mass-production industry faces the imperative of guaranteeing consumption of its output by managing the consumer. It does this through push distribution, high-pressure marketing, planned obsolescence, and consumer credit.

Mass advertising serves as a tool for managing aggregate demand. According to Baran and Sweezy, the main function of advertising is “waging, on behalf of the producers and sellers of consumer goods, a relentless war against saving and in favor of consumption.” And that function is integrally related to planned obsolescence:

The strategy of the advertiser is to hammer into the heads of people the unquestioned desirability, indeed the imperative necessity, of owning the newest product that comes on the market. For this strategy to work, however, producers have to pour on the market a steady stream of “new” products, with none daring to lag behind for fear his customers will turn to his rivals for newness.

Genuinely new or different products, however, are not easy to come by, even in our age of rapid scientific and technological advance. Hence much of the newness with which the consumer is systematically bombarded is either fraudulent or related trivially and in many cases even negatively to the function and serviceability of the product. [86]

….In a society with a large stock of consumer durable goods like the United States, an important component of the total demand for goods and services rests on the need to replace a part of this stock as it wears out or is discarded. Built-in obsolescence increases the rate of wearing out, and frequent style changes increase the rate of discarding…. The net result is a stepping up in the rate of replacement demand and a general boost to income and employment. In this respect, as in others, the sales effort turns out to be a powerful antidote to monopoly capitalism’s tendency to sink into a state of chronic depression. [87]

Although seemingly less state-dependent than the expedients discussed elsewhere in this paper, mass advertising had a large state component. For one thing, the founders of the mass advertising and public relations industries were, in large part, also the founders of the science of “manufacturing consent” used to manipulate Anglo-American populations into supporting World War I. For another, the state’s own organs of propaganda (through the USDA, school home economics classes, etc.) put great emphasis on discrediting “old-fashioned” atavisms like home-baked bread and home-grown and -canned vegetables, and promoting in their place the “up-to-date” housewifely practice of heating stuff up out of cans from the market. [88] Jeffrey Kaplan describes this as the “gospel of consumption”:

[Industrialists] feared that the frugal habits maintained by most American families would be difficult to break. Perhaps even more threatening was the fact that the industrial capacity for turning out goods seemed to be increasing at a pace greater than people’s sense that they needed them.

It was this latter concern that led Charles Kettering, director of General Motors Research, to write a 1929 magazine article called “Keep the Consumer Dissatisfied.”… Along with many of his corporate cohorts, he was defining a strategic shift for American industry — from fulfilling basic human needs to creating new ones.

In a 1927 interview with the magazine Nation’s Business, Secretary of Labor James J. Davis provided some numbers to illustrate a problem that the New York Times called “need saturation.” Davis noted that “the textile mills of this country can produce all the cloth needed in six months’ operation each year” and that 14 percent of the American shoe factories could produce a year’s supply of footwear. The magazine went on to suggest, “It may be that the world’s needs ultimately will be produced by three days’ work a week.”

Business leaders were less than enthusiastic about the prospect of a society no longer centered on the production of goods. For them, the new “labor-saving” machinery presented not a vision of liberation but a threat to their position at the center of power. John E. Edgerton, president of the National Association of Manufacturers, typified their response when he declared: “Nothing… breeds radicalism more than unhappiness unless it is leisure.”

By the late 1920s, America’s business and political elite had found a way to defuse the dual threat of stagnating economic growth and a radicalized working class in what one industrial consultant called “the gospel of consumption” — the notion that people could be convinced that however much they have, it isn’t enough. President Herbert Hoover’s 1929 Committee on Recent Economic Changes observed in glowing terms the results: “By advertising and other promotional devices . . . a measurable pull on production has been created which releases capital otherwise tied up.” They celebrated the conceptual breakthrough: “Economically we have a boundless field before us; that there are new wants which will make way endlessly for newer wants, as fast as they are satisfied.” [89]

Chandler’s model of “high-speed, high-throughput, turning high fixed costs into low unit costs,” and Galbraith’s “technostructure,” presuppose a “push” model of distribution. Here’s how it was described by Paul Goodman:

… in recent decades… the center of economic concern has gradually shifted from either providing goods for the consumer or gaining wealth for the enterpriser, to keeping the capital machines at work and running at full capacity; for the social arrangements have become so complicated that, unless the machines are running at full capacity, all wealth and subsistence are jeopardized, investment is withdrawn, men are unemployed. That is, when the system depends on all the machines running, unless every kind of good is produced and sold, it is also impossible to produce bread. [90]

The same imperative was at the root of the hypnopaedic socialization in Huxley’s Brave New World: “ending is better than mending”; “the more stitches, the less riches.” Or as GM designer Harley Earl said in the 1950s,

My job is to hasten obsolescence. I’ve got it down to two years; now when I get it down to one year, I’ll have a perfect score. [91]

The older economy that the “push” distribution system replaced was one in which most foods and drugs were what we would today call “generic.” Flour, cereal, and similar products were commonly sold in bulk and weighed and packaged by the grocer (the ratio had gone from roughly 95% bulk to 75% package goods during the twenty years before Borsodi wrote in 1927); the producers geared production to the level of demand that was relayed to them by the retailers’ orders. Drugs, likewise, were typically compounded by the druggist on-premises to the physician’s specifications, from generic components. [92] Production was driven by orders from the grocer, as customers used up his stock of bulk goods.

Under the new “push” system, the producers appealed directly to the consumer through brand-name advertising, and relied on pressure on the grocer to create demand for what they chose to produce. Brand loyalty helps to stabilize demand for a particular manufacturer’s product, and eliminate the fluctuation of demand that accompanies price competition in pure commodities.

The problem was that the consumer, under the new regime of Efficiency, paid about four times as much for trademarked flour, sugar, etc., as he had paid for bulk goods under the old “inefficient” system. [93] Under the old regime, the grocer was a purchasing agent for the customer; under the new, he was a marketing agent for the producer.

Distribution costs are increased still further by the fact that larger-scale production and greater levels of capital intensiveness increase the unit costs resulting from idle capacity, and thereby (as we saw in the last chapter) greatly increase the resources devoted to high-pressure, “push” forms of marketing.

Borsodi’s book The Distribution Age was an elaboration of the fact that production costs fell by perhaps a fifth between 1870 and 1920, even as the cost of marketing and distribution nearly tripled. [94]

The modest reduction in unit production cost was more than offset by the increased costs of distribution and high-pressure marketing. “[E]very part of our economic structure,” he wrote, was “being strained by the strenuous effort to market profitably what modern industry can produce.” [95]

Distribution costs are far lower under a demand-pull regime, in which production is geared to demand. As Borsodi argued,

…[I]t is still a fact… that the factory which sells only in its natural field because that is where it can serve best, meets little sales-resistance in marketing through the normal channels of distribution. The consumers of such a factory are so “close” to the manufacturer, their relations are so intimate, that buying from that factory has the force of tradition. Such a factory can make shipment promptly; it can adjust its production to the peculiarities of its territory, and it can make adjustments with its customers more intelligently than factories which are situated at a great distance. High pressure methods of distribution do not seem tempting to such a factory. They do not tempt it for the very good reason that such a factory has no problem to which high pressure distribution offers a solution.

It is the factory which has decided to produce trade-marked, uniform, packaged, individualized, and nationally advertised products, and which has to establish itself in the national market by persuading distributors to pay a higher than normal price for its brand, which has had to turn to high pressure distribution. Such a factory has a selling problem of a very different nature from that of factories which are content to sell only where and to whom they can sell most efficiently. [96]

For those whose low overhead permits them to produce in response to consumer demand, marketing is relatively cheap. Rather than expending enormous effort to make people buy their product, they can just fill the orders that come in. When demand for the product must be created, the effort (to repeat Borsodi’s metaphor) is comparable to that of making water run uphill. Mass advertising is only a small part of it. Even more costly is direct mail advertising and door-to-door canvassing by salesmen to pressure grocers in a new market to stock one’s goods, and canvassing of grocers themselves by sales reps. [97] The costs of advertising, packaging, brand differentiation, etc., are all costs of overcoming sales resistance that only exist because production is divorced from demand rather than driven by it.

And this increased marginal cost of distribution for output above the natural level of demand results, in accordance with Ricardo’s law of rent, in higher average price for all goods. [98]

For those who can flexibly respond to demand, also, predictability of consumer demand doesn’t matter that much. Of the grocer, for example, Borsodi pointed out that the customer would always have to eat, and would continue to do so without a single penny of high pressure marketing. It was therefore a matter of indifference to the grocer whether the customer ate some particular product or brand name; he would stock whatever goods the customer preferred, as his existing stocks were used up, and change his orders in keeping with changes in customer preference. To the manufacturer, on the other hand, it is of vital importance that the customer buy (say) mayonnaise in particular — and not just mayonnaise, but his particular brand of mayonnaise. [99]

And the proliferation of brand names with loyal followings raises the cost of distribution considerably: rather than stocking generic cornflakes in bulk commodity form, and replacing the stock as it is depleted, the grocer must maintain large enough stocks of all the (almost identical) popular brands to ensure against running out, which means slower turnover and more wasted shelf space. This is another illustration of the same general principle we’ve already seen: push distribution results in the costly disruption of flow by stagnant eddies and flows, in the form of ubiquitous inventories. [100]

The advantage of brand specification, from the perspective of the producer, is that it “lifts a product out of competition”: [101] “the prevalence of brand specification has all but destroyed the normal basis upon which true competitive prices can be established.” [102] As Barry Stein described it, branding “convert[s] true commodities to apparent tailored goods, so as to avoid direct price competition in the marketplace.”

The distinctions introduced — elaborate packaging, exhortative advertising and promotion that asserts the presence of unmeasurable values, and irrelevant physical modification (colored toothpaste) — do not, in fact, render these competing products “different” in any substantive sense, but to the extent that consumers are convinced by these distinctions and treat them as if they were different, product loyalty is generated. [103]

Under the old regime, competition between identifiable producers of bulk goods enabled grocers to select the highest quality bulk goods, while providing them to customers at the lowest price. Brand specification, on the other hand, relieves the grocer of the responsibility for standing behind his merchandise and turns him into a mere stocker of shelves with the most-requested brands.

The process went on until — decades later — the very idea of a return to price competition in the production of goods, instead of brand-name competition for market share, would strike manufacturers with horror. Price competition is the worst nightmare of the oligopoly manufacturer and the advertising industry:

At the annual meeting of the U.S. Association of National Advertisers in 1988, Graham H. Phillips, the U.S. Chairman of Ogilvy & Mather, berated the assembled executives for stooping to participate in a “commodity marketplace” rather than an image-based one. “I doubt that many of you would welcome a commodity marketplace in which one competed solely on price, promotion and trade deals, all of which can be easily duplicated by competition, leading to ever-decreasing profits, decay, and eventual bankruptcy.” Others spoke of the importance of maintaining “conceptual value-added,” which in effect means adding nothing but marketing. Stooping to compete on the basis of real value, the agencies ominously warned, would speed not just the death of the brand, but corporate death as well. [104]

It’s telling that Chandler, the apostle of the great “efficiencies” of this entire system, frankly admitted all of these things. In fact, far from regarding it as an “admission,” he treated it as a feature of the system. He explicitly equated “prosperity” to the rate of flow of material through the system and the speed of production and distribution — without any regard to whether the rate of “flow” was twice as fast because people were throwing stuff in the landfills twice as fast to keep the pipelines from clogging up.

The new middle managers did more than devise ways to coordinate the high-volume flow from suppliers of raw materials to consumers. They invented and perfected ways to expand markets and to speed up the processes of production and distribution. Those at American Tobacco, Armour, and other mass producers of low-priced packaged products perfected techniques of product differentiation through advertising and brand names that had been initially developed by mass marketers, advertising agencies, and patent medicine makers. The middle managers at Singer wee the first to systematize personal selling by means of door-to-
door canvassing; those at McCormick among the first to have franchised dealers using comparable methods. Both companies innovated in installment buying and other techniques of consumer credit. [105]

In other words, the Sloanist system Chandler idealized was more “efficient” because it was better at persuading people to throw stuff away so they could buy more, and better at producing substandard shit that would have to be thrown away in a few years. Only a liberal of the mid-20th century, writing at the height of consensus capitalism, at a time when the first rumblings of New Left critique were only just issuing from Port Huron, and when his own establishment liberalism was as yet utterly untainted by the thinnest veneer of greenwash, could write such a thing from the standpoint of an enthusiast.

The overall system was a “solution” in search of a problem. State subsidies and mercantilism gave rise to centralized, overcapitalized industry, which led to overproduction, which led to the need to find a way of creating demand for lots of crap that nobody wanted.

Notes: 

86. Paul Baran and Paul Sweezy, Monopoly Capitalism: An Essay in the American Economic and Social Order (New York: Monthly Review Press, 1966), pp. 128-129.

87. Ibid., p. 131.

88. This is the theme of Stuart Ewen, Captains of Consciousness: Advertising and the Social Roots of Consumer Culture (New York: McGraw-Hill, 1976).

89. Jeffrey Kaplan, “The Gospel of Consumption: And the better future we left behind,” Orion, May/June 2008
<http://www.orionmagazine.org/index.php/articles/article/2962>.

90. Paul and Percival Goodman, Communitas: Means of Livelihood and Ways of Life (New York: Vintage Books, 1947,
1960), pp. 188-89.

91. Eric Rumble, “Toxic Shocker,” Up! Magazine, January 1, 2007 <http://www.up-
magazine.com/magazine/exclusives/Toxic_Shocker_3.shtml>.

92. Ralph Borsodi, The Distribution Age (New York and London: D. Appleton and Company, 1929), pp. 217, 228.

93. Quoted in Ibid., pp. 160-61.

94. Ibid., p. v.

95. Ibid., p. 4.

96. Ibid., pp. 112-113.

97. Ibid., p. 136.

98. Ibid., p. 247.

99. Ibid., pp. 83-84.

100. Ibid., p. 84.

101. Ibid., p. 162.

102. Ibid. pp. 216-17.

103. Stein, Size, Efficiency, and Community Enterprise, p. 79.

104. Naomi Klein, No Logo (New York: Picador, 1999), p. 14.

105. Chandler, The Visible Hand, p. 411.

Durante un discurso en las Naciones Unidas en el 2006, Hugo Chávez acusó al ex presidente de EE.UU. George W. Bush de ser «el diablo» mientras alzaba en sus manos una ejemplar de Hegemonía o Supervivencia: El Dominio Mundial de Estados Unidos, catapultando el libro en la lista de best-sellers de Amazon.com.

Por su parte, Chomsky ha declarado en varias ocasiones que Chávez llevó a cabo una ruptura revolucionaria con el pasado político de Venezuela, especialmente en relación con las políticas sociales del estado para con los pobres, haciendo eco del discurso chavista fundacional de la «revolución bolivariana».

En una entrevista con el periódico español Diagonal en marzo de 2006 Chomsky declaró que «por primera vez el país está utilizando… recursos energéticos para su desarrollo… en la construcción, la salud…». Así mismo, en un artículo de opinión para La Jornada de México en el 2005, escribió que «es sólo ahora con el presidente Chávez… [que] la medicina se ha convertido en algo real para la mayoría de los pobres».

El mes pasado, hablando con el economista venezolano Miguel Ángel Santos , Chomsky reiteró su punto: «Durante muchos años Venezuela estuvo dominada por élites que… cosechaban todos los beneficios de las bonanzas petroleras mientras marginaban a los pobres… Chávez se enfrentó a eso…».

Lamentablemente, Chomsky ignora hechos básicos de la historia contemporánea de Venezuela. No hay nada de revolucionario en las políticas sociales chavistas.

En La Revolución como Espectáculo, Rafael Uzcátegui, co-editor del periódico anarquista venezolano El Libertario, presenta una enorme cantidad de datos que muestran que hasta principios de los años 80, cuando los precios del petróleo comenzaron un descenso sostenido que drenó la capacidad del Estado venezolano para sostener los subsidios masivos que apaciguaban a las masas desde 1958 y en última instancia condujo al Caracazo en 1989 (una ola de disturbios durante el segundo gobierno de Carlos Andrés Pérez en la que miles de personas fueron asesinadas por los militares), las políticas de bienestar eran tan omnipresentes, y a veces más efectivas, que las que caracterizaron al período chavista.

Limitaremos la mirada a las dos áreas mencionadas por Chomsky, vivienda y asistencia sanitaria (Uzcátegui aplica un análisis similar para una amplia gama de políticas sociales).

Según los datos del censo nacional, los proyectos de vivienda del estado redujeron las chabolas como porcentaje del total de viviendas del 37,18% en 1961 al 12,56% en 1990. La penetración de la red eléctrica pasó del 58,16% en 1961 al 76,59% en 1981. El acceso a agua potable aumentó del 46,7% en 1961 al 68,74% en 1981.

El gobierno de Chávez construyó un promedio de 26.000 hogares por año entre 1999 y 2008. El promedio de la década de los 90 fue mucho más alto, alcanzando 64.000 por año.

Las «Clínicas Populares» y «Hospitales del Pueblo» creados por la famosa Misión Barrio Adentro, un programa ampliamente publicitado como pionero en dar acceso a los pobres a la atención médica, son hoy incapaces de proporcionar tratamiento para cualquier dolencia más compleja que una fractura ósea.

Para los tratamientos críticos la gente debe acudir a la vieja red de hospitales construidos durante la Cuarta República, que en 1980 alcanzó una de las coberturas más amplias de la región con 2,7 camas por cada mil habitantes, pero que hoy está prácticamente en ruinas.

Esto se tradujo, entre otras tragedias, en que las mujeres más pobres de Venezuela diesen a luz en condiciones inhumanas durante el período 1998-2008, y en una tasa de 16% de mortalidad materna debida a abortos clandestinos para el 2010.

La otra cara del argumento de Chomsky, que Venezuela antes de Chávez estaba dominada por élites que cosechaban la mayor parte de la bonanza petrolera, es cierta pero irrelevante. La Venezuela de hoy sigue estando dominada por élites, aunque nuevas: la llamada boliburguesía, ricos y poderosos gracias a sus conexiones políticas o su participación directa en el todopoderoso estado bolivariano.

En realidad, la élite chavista es mucho más corrupta, autoritaria e inepta que sus predecesores de la Cuarta República. Si el monopolio del uso de la fuerza y ​​la administración de la justicia es la característica más básica y definitoria del estado, Venezuela hoy fácilmente puede ser descrita como un estado fallido: La epidemia de violencia que azota al país dejó un saldo de casi 25.000 asesinatos en el 2013, más del 90% sin resolver .

Hugo Chávez no era un revolucionario. Más bien profundizó el modelo de socialdemocracia petro-estatista imperante en Venezuela desde 1958 hasta un nivel sin precedentes. Y también, como sostiene Uzcátegui en su libro, ejecutó magistralmente el arte del espectáculo demagógico como nadie antes que él – espectáculo que dejó totalmente deslumbrado a Noam Chomsky, a pesar de su toda su fuerza intelectual y analítica .

C4SS has teamed up with the Distro of the Libertarian Left. The Distro produces and distribute zines and booklets on anarchism, market anarchist theory, counter-economics, and other movements for liberation. For every copy of S. E. Parker’s “My Anarchism” that you purchase through the Distro, C4SS will receive a percentage. Support C4SS with S. E. Parker’s “My Anarchism“.

$1.00 for the first copy. $0.60 for every additional copy.

Originally published as an article in Free Life, the journal of the Libertarian Alliance (U.K.), in Vol. II, No. 2 (Spring 1981), “My Anarchism” defends a bracing individualism, and opens up a challenge to communist theories of ownership: if access to the means of production is mediated entirely through social relationships and communal connections, does this mean social liberation? Or does it just mean a new social capitalism, with the individual finding herself at the mercy of new monopolies, administered “horizontally” by the majority?

“The common ownership of the means of production would confront me with the choice: integrate or perish. Any group, or federation of groups, can be as powerful as any state if it monopolises in any given area the potentialities of action and realisation. The result would be social totalitarianism. . . .”

“What power could I exercise for example if I were stuck at the base of the pyramid of workers’ councils proposed as the administrative structure for indus­tries in the communist society? At best, and in its purest form, such a system might produce an ‘anarchism’ of groups. It would not produce an anarchism of individuals…”

“There is no vertical authority exercised by a State, but there is horizontal authority exercised by ‘soc­iety’ in the form of customs that are often more ubi­quit­ous and despotic than modern governments. . . . All col­lec­t­i­v­ities need norms to which their members must conform if they are to function. And these norms need sanctions to ensure that they are obeyed. Anarchism has never existed as a form of society, nor is it ever likely to. Indeed, I consider it a grave mistake to conceive of anarchism as asocial theory. Anarchism is not a form of society. It is the cutting edge of individualism. . . .”

Sidney Parker was a prolific individualist anarchist writer and editor best known for his long-running egoist journal Minus One, later retitled The Egoist and Ego, which ran from 1963–1993.

De meeste markt-anarchisten beweren dat staten met dwang opgelegde territoriale monopolies zijn. Deze monopolies nemen de taken van defensie en geschillenbeslechting op zich. Oftewel; het zijn maffiosi met een goede PR-afdeling.

De basisfunctie van een staat is om het leven van haar burgers te beschermen. Echter, word je niet de mogelijkheid gegeven om te kunnen kiezen wie deze beschermende taak op zich neemt. Je word gedwongen om deze bescherming, geleverd door de lokale monopoliehouder, te betalen of je dat nou wilt of niet. Als je je verzet beland je in de gevangenis.

Eén van de manieren waarop markt-anarchisten deze kwestie benaderen is om te vragen “moet iemand ooit onder dwang voor een dienst betalen?” Wij zijn natuurlijk tegen dergelijke daden van dwang op ethische gronden. We zijn ook van mening dat zulke gedwongen interferentie met de keuze van de consument een afschuwelijk incentive-probleem creëert: waarom zou een staat je vriendelijk behandelen als ze net zo goed weg kunnen komen met een onvriendelijke behandeling?

Een staat is niet het bestuur op basis van de instemming van de geregeerden, maar verovering onder valse voorwendselen.

Vertalingen voor dit artikel:

• English, What is a government or state?

<< TERUG NAAR VEELGESTELDE VRAGEN

One of the virtues of Jacob Huebert’s Libertarianism Today is that it provides ample evidence for the high literacy rates of Americans prior to the introduction of compulsory education laws. The moral and the practical come together beautifully here. Not only is it unethical to initiate force for the purpose of compelling children to attend schools, it isn’t necessary for effectual education. The consequentialist statist is left without good evidence.

Let us turn to a select quotation from the book on page 114:

Professor Lawrence Cremin has estimated that male literacy ranged from 70 to 100 percent. Other research shows that from 1650 to 1795, male literacy rose from 60 percent to 90 percent, and female literacy rose from 30 percent to 45 percent. From 1800 to 1840, literacy in the North rose from 75 percent to somewhere between 91 and 97 percent. In the South during that same time period, it went from 50 to 60 percent to 81 percent. Writer and educator, John Taylor Gatto notes that “by 1840 the incidence of complex literacy in the United States was between 93 and 100 percent wherever such a thing mattered.” In 1850, just before Massachusetts imposed compulsory schooling, literacy in that state was at 98 percent.

A highly literate population is clearly possible without state intervention in education. This goes along well with the moral principle of freedom of thought for children idenitfied by the late radical educator, John Holt. This principle demands that young people be free to control their own learning. When allowed to do so, a child is able to fit learning how to read into his or her own desires/interests. A self-directed process of discovery that can strengthen a child’s drive to learn more.

The joy of reading is preferable when not tainted by the evil of aggressive coercion. We left-libertarians are uniquely positioned to encourage literacy without coercion. There are revolutionary alternatives to an statist regime of compelled learning. They include unschooling, Sudbury schools, and Montessori schools. Among these choices, unschooling is my favorite. It provides the most radical alternative to statist models of education. In its respect for individuality, choice, and freedom, it’s the most compatible with libertarian principle.

Cultural change requires a corresponding educational transformation. If we wish to move society towards greater freedom, we will have to raise our children differently. They are to be allowed a great deal of freedom to pursue their own dreams and interests. The educational alternatives mentioned above can help make this a reality. Let’s get started on it!

Translations for this article:

• Turkish, Zorunlu Öğretim, Okuryazarlık, Ve Eğitim Alternatifleri.

Download: MOLOCH: Mass-Production Industry as a Statist Construct.

I. The Origins of Sloanist Mass Production

A Fork in the Road
A Wrong Turn
The Role of the State in Tipping the Balance

II. The Institutional Imperatives of Sloanism

Economies of Scale, Economies of Speed, and Push Distribution
Microeconomic Institutional Forms for Providing Stability
Mass Consumption to Absorb Surplus
Political Capitalism
State Action to Absorb Surplus: Imperialism
State Action to Absorb Surplus: Creation of New Industries

III. Conclusion

In keeping with the need for stability and control Galbraith described above, the technostructure resorted to organizational expedients within the corporate enterprise to guarantee reliable outlets for production and provide long-term predictability in the availability and price of inputs. These expedients can be summed up as replacing the market price mechanism with planning.

A firm cannot usefully foresee and schedule future action or prepare for contingencies if it does not know what its prices will be, what its sales will be, what its costs including labor and capital costs will be and what will be available at these costs…. Much of what the firm regards as planning consists in minimizing or getting rid of market influences. [73]

Galbraith described three institutional expedients taken by the technostructure to control the uncertainties of the market and permit long-term predictability: vertical integration, the use of market power to control suppliers and outlets, and long-term contractual arrangements with suppliers and outlets. [74]

In vertical integration, “[t]he planning unit takes over the source of supply or the outlet; a transaction that is subject to bargaining over prices and amounts is thus replaced with a transfer within the planning unit.” [75]

One of the most important forms of “vertical integration” is the choice to “make” rather than “buy” credit — replacing the external credit markets with internal finance through retained earnings. [76] The theory that management is controlled by outside capital markets assumes a high degree of dependence on outside finance. But in fact management’s first line of defense, in maintaining its autonomy from shareholders and other outside interests, is to minimize its reliance on outside finance. Management tends to finance new investments as much as possible with retained earnings, followed by debt, with new issues of shares only as a last resort. [77] Issues of stock are important sources of investment capital only for startups and small firms undertaking major expansions. [78] Most corporations finance a majority of their new investment from retained earnings, and tend to limit investment to the highest priorities when retained earnings are scarce. [79] As Doug Henwood says, in the long run “almost all corporate capital expenditures are internally financed, through profits and depreciation allowances.” Between 1952 and 1995, almost 90% of investment was funded from retained earnings. [80]

Market control “consists in reducing or eliminating the independence of action of those to whom the planning unit sells or from whom it buys,” while preserving “the outward form of the market.” Market power follows from large size in relation to the market. A decision to buy or not to buy, as in the case of General Motors and its suppliers, can determine the life or death of a firm. What’s more, large manufacturers always have the option of vertical integration — making a part themselves instead of buying it — to discipline suppliers. “The option of eliminating a market is an important source of power for controlling it.” [81]

Long-term contracting can reduce uncertainty by “specifying prices and amounts to be provided or bought for substantial periods of time.” Each large firm creates a “matrix of contracts” in which market uncertainty is eliminated as much as possible. [82]

The use of contracts to stabilize input availability and price is exemplified, in particular, by the organizational expedients to stabilize wages and reduce labor turnover under the American labor regime. The purpose of the Wagner regime, created under the New Deal, was “by stabilizing wages and employment, to insulate the cost of a major element of production from the flux of a market economy.” [83] From management’s perspective, the sort of bureaucratized industrial union established under Wagner had the primary purposes of enforcing contracts on the rank and file and suppressing wildcat strikes. The corporate liberal managers who were most open to industrial unionism in the 1930s were, in many cases, the same people who had previously relied on company unions and works councils. Their motivation, in both cases, was the same. For example, GE’s Gerard Swope, one of the most “progressive” of corporate liberals and the living personification of the kinds of corporate interests that backed FDR, had attempted in 1926 to get the AFL’s William Green to run GE’s works council system. [84]

Another institutional expedient of Galbraith’s technostructure is to regulate the pace of technical change, with the oligopoly firms in an industry colluding to introduce innovation at a rate that maximizes returns. Or as Paul Goodman put it, a handful of manufacturers control the market, “competing with fixed prices and slowly spooned-out improvements.” [85]

Notes: 

73. Galbraith, The New Industrial State, p. 37.

74. Ibid., p. 38.

75. Ibid., p. 39.

76. Ibid., pp. 50-51.

77. Martin Hellwig, “On the Economics and Politics of Corporate Finance and Corporate Control,” in Xavier Vives, ed.,
Corporate Governance: Theoretical and Empirical Perspectives (Cambridge: Cambridge University Press, 2000),pp.
100-101.

78. Ralph Estes, Tyranny of the Bottom Line: Why Corporations Make Good People Do Bad Things (San Francisco: Berrett-Koehler Publishers, 1996), p. 51.

79. Hellwig, pp. 101-102, 113.

80. Doug Henwood, Wall Street: How it Works and for Whom (London and New York: Verso, 1997), p. 3.

81. Galbraith, The New Industrial State, pp. 39-40.

82. Ibid., pp. 41-42.

83. Ibid., p. 65.

84. Piore and Sabel, p. 132.

85. Paul Goodman, People or Personnel, in People or Personnel and Like a Conquered Province (New York: Vintage Books, 1963, 1965), p. 58.

Freedom and the right to self-defense won a great victory in Texas on Thursday, February 6.

Burleson County prosecutor Julie Renken vindictively sought to cage marijuana farmer Henry Goedrich Magee for murder after the fatal shooting of  Adam Sowders, who invaded Magee’s home in the middle of the night to steal his crops and his firearms. Because Sowders was a deputy sheriff, Renken sought to make an example of Magee for anyone who might dare resist the agents of the state. But in a stunning development, the long-moribund grand jury, originally intended as a check on state power but in recent years increasingly a rubber stamp, stirred and declined to indict Mr. Magee. The grand jury determined that not enough evidence existed to try him for murder.

The right to defend one’s self is in many ways the most basic principle of liberty. Those who have been in the power of the state and who have known that they will be physically forced to comply, forced to the point of death, know well how precious the right of self-defense is. In truth, one against whom you cannot defend yourself might be well considered your master, even your owner. If any country is to be regarded as free, the citizens thereof must have a universally acknowledged right to resist unlawful arrest, even (and especially) to the point of killing police who act unlawfully.

That grand jury struck a blow for liberty, but much remains to be done. Mr. Magee was only spared indictment because the grand jury found insufficient evidence to prove that Sowders had adequately identified himself as a police officer before Magee gunned him down. Had Sowders clearly identified himself as the armed agent of the state, intent on abducting Mr. Magee and his girlfriend and stealing their crops and firearms,  Magee would even now face a lifetime in prison or possibly even execution for defending himself against an armed, violent intruder.

But Magee struck another blow for liberty the moment he pulled that trigger. As a veteran of the Iraq War and of the nocturnal home invasions that characterized that war, I can say from personal experience that the knowledge that the inhabitants of a home might shoot back weighs heavily on the minds of criminals, uniformed or otherwise, as they prepare to break in. Indeed, the casualties we suffered played a huge, perhaps dominant part in the switch from “cordon and search,” or classical home invasions, to “cordon and knock” as the preferred tactic for locating the enemy. Furthermore those casualties, as dearly as I may miss the ones I knew personally, were the reason we ultimately left Iraq.

Whether or not to resist state violence is a deeply personal decision we all must face any time we confront an agent of the state, whether it is the tax collector, a traffic stop or a SWAT team coming through our doors at midnight. But even the simple act of making it a decision, of actively deciding whether it is in your best interests and in the best interests of all our brothers and sisters to resist or to passively submit, is a liberatory act, a moment of freedom. For too long we have obeyed our conditioning and rolled over for the state.  Magee’s case is a positive step, but his decision to resist, to shoot at anyone invading his home, regardless of who signs their paycheck, is what makes him a hero.

C4SS has teamed up with the Distro of the Libertarian Left. The Distro produces and distribute zines and booklets on anarchism, market anarchist theory, counter-economics, and other movements for liberation. For every copy of James Tuttle’s “Direct Action on the Job!” that you purchase through the Distro, C4SS will receive a percentage. Support C4SS with James Tuttle’s “Direct Action on the Job!”

$1.00 for the first copy. $0.60 for every additional copy.

This article is a transcript of a talk by Director Tuttle, entitled “The Libertarian and Radical Labor Dis­con­nect,” on the culture, techniques and ideas of radical labor organizing, originally presented at the Dallas Students for Liberty Regional Conference in October 2012.

“The case that I’d like to build is threefold. I want to say there’s a distinction between radical labor and conservative labor, and radical labor is, can be de­fin­ed as, solidarity power: decentralized, apolitical — ex­plicit­ly apolitical — and direct action based. And that they’re org­anizing in order to displace power, or gain power where there is none. So from this kind of model, we can understand or start to understand how they operate, operat­ing along — how are they thinking of targets and tactics? — and how are they reacting to them? — where does this militancy come from?

“I would like to suggest there are three themes that are formed in radical organizations. One of them is solidarity. Another one is the concept called ‘visceral orientation:’ you feel it in your gut when you look around. And a culture of resistance, which will start to demonstrate why you’re operating this way, and why they ally in some instances with this group and why not in another instance. . . .

“Work as we experience it and recognize it to­day contains features that undermine or act against radicalism. And that, due to our shared kind of radicalism, that this is a con­cern not just for labor but for libertarianism. I think we can charitably re­gard liber­tar­ian­ism as a project that is the opposite of, or in op­pos­i­t­ion to, authority. . . . Liberty should not be a condition that you clock in and out of. . . If we’re going to be active and political off of work, then why are we clocking in and accepting situations where we can’t actively in­put? It feels weird to fight for liberty, but only after work.”

F.W. James Tuttle is a left-libertarian anarcho-os­tro­m­ite living and working in Tulsa, Oklahoma, the Coordinating Director of the Center for a Stateless Society (C4SS), a Co-Editor of the left-libertarian zine ALLiance Journal, and a proud organizer for the Industrial Workers of the World. A video recording of this talk was uploaded to YouTube by the DFW Alliance of the Libertarian Left; the transcript was prepared through the generous assistance of L.B., and edited for the booklet format by Charles Johnson of the Alliance of the Libertarian Left Distro.

The following article, “Cómo el Go se convirtió en el juego favorito de anarquistas y libertarios,” was written by David de Ugarte and published on El Correo de las Indias, January 17, 2014.

When the British Go Association proposed to fund a strategy to promote the game and commissioned a study on its image, the result was surprising [PDF]: Go was described in the responses as too “difficult,” too “intellectual,” or simply “outside of reach” of the respondents. Part of this image problem could be due to the fact that its introduction in Europe and the US was led by mathematicians, physicists and engineers linked to the scientific vanguard and elite universities. Perhaps it also has something to do with how Go has been portrayed by North American cinema: A game which even geniuses like John Nash are incapable of mastering, overwhelmed by the “chaotic nature of the universe” that the game supposedly reflects.

What’s interesting is that there’s some truth to that. Ultimately, the main precursor of the game in England was none other than Alan Turing. While directing the famous team that would decipher the Enigma machine and create Colossus, the first computer in history, he was playing Go almost daily. The scene of Turing studying the goban [board], or inviting others to play, became so common that today, in Bletchley Park, his old office is decorated with a board and two baskets of stones. That was where he taught a young mathematician from Oxford to play – I. J. Good. Good would continue working — and playing — with Turing after the war in the famous studio in Manchester where The Baby and Mark 1, the first civilian computers, would be born.

He is considered the successor to Turing’s work, and we owe Good things as important as the Fast Fourier transform, surely the most used algorithm in history. Beyond informatics and Baysian statistics, the truth is that he had an interesting life, including milestones like the first theorization of the “technological singularity” and having advised Kubrick on HAL and the information systems in “2001: A Space Odyssey.”

But in reality, Good had already become popular among restless young students years before the movie, when, in his column in the New Scientist of January 21, 1965, he published an article called “The mystery of Go.” Today, the British Go Association recognizes that article as the true beginning of the spread of the game in the islands, and a whole generation of players remembers it as the starting point of their attraction to the game.

The curiosity awakened by the article materialized in dozens of clubs, almost all linked to university environments in which the student movements of ’68 were brewing. The famous Arabist Robert Irwin tells in his memoir how “the craze for the Japanese game of Go was at its height,” and his alter ego, Harvey, star of the moment in the “Oxford Anarchist Society” teaches him to play and use shi, the logic of encircling, as a way of approaching discussions of all kinds.

Go In May Of ’68

Go is jumping from the science faculties to the social faculties, and from the islands to the continent. In 1965, a mathematics professor, Chevalley, that began playing the game because of Good’s article, teaches Jacques Roubaud to play. Roubard is one of the founders of the Oulipo group, and, though he will go down in history as a writer, a mathematician by training. Soon two more members join the group: Pierre Lusson and the great Georges Perec. Perec is captivated by the game, and in the middle of 1968, writes “The Disparition,” which uses more than a few metaphors that begin in situations on the board, and in 1969, with Lusson and Roubaud, the famous “Petit traité invitant à la découverte of l’art subtil du go.”

Although manuals had already been published in French, the book unleashes the interest of the young French intellectuals of the times, who take Go as symbolic of otherness, of the opposite of thought of traditional power symbolized by chess.

Go becomes something alternative and cool. Even a young North American science fiction writer, Ursula K. Leguin, includes it in her latest novel, “The left hand of darkness,” winner of the Hugo award that year (and the Nebula the following year, 1970).

Years later, Deleuze and Guattari, who had seen a goban for the first time at Perec’s home, will pick up this Perecian and spirit-of-’68 idea of the otherness of Go, in one of the most important books of libertarian European thought at the end of the century, “A Thousand Plateaus” (1980):

Chess is a game of State, or court; the Emperor of China practiced it. Chess pieces are codified, they have an internal nature or intrinsic properties, from which their movements, their positions, their confrontations are derived. They are qualified, the horse is always a horse, the bishop a bishop, the pawn a pawn. Each one is like a subject of enunciation, gifted with a relative power; and those relative powers combine in a subject of enunciation, the chess player, or the form of inner self of the game.

The pawns in Go, on the contrary, are balls, cards, simple arithmetic units, whose sole function is anonymous, collective or third-person: “It” advances — it could be man, a woman, a flea, or an elephant. The pawns in Go are the elements of a non-subjectivized mechanical agency, without intrinsic properties, but only situational. The relationships are also very different in the two cases. In their means of inwardness, the chess pieces maintain two-way relationships with each other, and with the adversary : their functions are structural. A pawn in Go, on the contrary, only has means of outwardness, or extrinsic relationships with cloudy consteallations, according to which it carries out functions of insertion or situation, like bordering, surrounding, breaking. A single pawn in Go can synchronously annihilate a whole constellation, while one chess piece cannot (or can only do it diachronically).

Chess is clearly a war, but an insitutionalized, regulated, codified war, with a front, a rearguard, and battles. What is unique about Go, on the other hand, is that it is a war without battlelines, without confrontation and rearguard, and in the ultimate extreme, without battle: pure strategy, while chess is semiotics. Finally, it is not about space itself: in the case of the chess, it is a game of distributing a closed space, hence, of going from one point to another, of occupying a maximum of squares with a minimum of pieces. Go is a game of being distributed in a open space, of occupying the space, of conserving the possibility of emerging at any point: movement no longer goes from one point to another, but rather becomes perpetual, without goal or destination, without departure or arrival.

Smooth space of Go versus striated space of chess. Nomos of Go versus State of chess, nomos versus polis. Because chess codifies and decodifies space, while Go proceeds in another way, territorializing and desterritorializing it (turning the exterior into a territory in space, consolidating that territory through the construction of a second adjacent territory, deterritorializing the enemy through the internal rupture of their territory, deterritorializing oneself by retreating, going somewhere else…). Another justice, another movement, another space-time.

The Internet Era

In the ’80s and ’90s, in Europe and the US, Go no longer depended on concrete people to develop. It was a minority cultural element within a minority. But that excentric and often erudite minority, almost always university-associated and technophile, was fermenting in something new: hacker culture, which, in turn, was going to shape a good part of the new world that would come with the Internet. When, in the second half of the ’90s, HTML and the newborn World Wide Web opened the tap of massive socialization of the new medium, Go gained a sudden visibility simply because the percentage of Internet users who are players is far above the average in the population.

Robert Bozulich, author of some of the best-known books on the game in the West, is a good example of that environment and that evolution. He studied at UCLA and graduated in mathematics from Berkeley in ’66. In ’68, he went to Japan, where he created his first publishing house — in English — specializing in Go, Ishi Press, which will be succeeded, in the ’90s, by Kiseido. In 2000, when the first game servers appeared, he created, through Kiseido, KGS the exchange and gaming space for Go most used by Western players. A resident of Japan, he became a go-to person in the world of online libertarian activism, in which he became involved to the point of standing as a candidate for several testimonial formations, the latest being the Personal Freedom Party. He is not the only one. By 2003, it was already relatively common to find voices that called for a “Go strategy at the libertarian fringes of Republicanism. One discussion permeated those surroundings to the point of normalizing references to the game among electoral strategists.

The Go’ing Insurrection

In the insurrectionist and collectivist side of anarchism, a similar phenomenon was taking place, though with constant references to the idea of Go given by Deleuze and Guattari. In the second half of the nineties, the first groups that begin to think about Go as a metaphor to theorize libertarian alternatives that incorporate the Internet and free software into their design were already appearing. But it will be with the crisis, starting in 2010, that the strategic metaphors based on Go begin to multiply.

And thus, in November 2013, The Go’ing Insurrection [PDF] appears, the little book that is fashionable among afficionados right now. Anonymously written, its title is an homage to The Arriving Insurrection [PDF] (or The Coming Insurrection, depending on the translation), the famous and polemic post-Tiqqun text attributed to Joulien Coupat, to whom, however, it owes little beyond a few quotes: the idea that in politics, as in Go, territory is a relational concept, not spatial or scenic, does not begin with Coupat, but is, rather, commonplace in non-nationalist European thought since Walter Benjamin. In any case, the result is forty very suggestive pages, and recommended for anyone regardless of their ideology.

Go and the interesting life

The idea of Go as a school, or at least as a strategic language to think in terms of liberties and conflict resolution, surely has won more people over to Go than to libertarian ideas.

What’s true is that the game of Go is a terrain on which new situations and problems are constantly presented in an intellectually elegant manner. To solve them, to learn, to create knowledge for the pleasure of knowing, is doubtlessly more than enough motivation in itself. According to Desmond Morris, to learn, to discover, is the pleasure that evolution taught us to enjoy so that we would be able to adapt to the medium without having to wait millions of years to see if mutations responded better or not.

The libertarian ethos of all times has intuited that it is in that pleasure where the meaning of existence resides. So have totalitarian and paternalistic regimes of all times, of course, but they reject the frivolity of that “empty knowledge” that disperses society from the dream – their dream – of a one and only objective.

Surely that is the truth underneath the old Chinese saying that “no Go player is a bad person.” A game so abstract generates a kind of knowledge that is so hard to instrumentalize, that it necessarily raises a contradiction between the political will to impose on others, and the personal pleasure of an interesting life. You have to be a bit of an anarchist to be able to incorporate Go into your life. And if you like it because you’ve turned the desire to learn into the engine of your actions, it’s more than likely that you also have a minimalist in you, and you’re not very interested in fighting over resources or wealth with anyone.

Certainly, that pleasure in serial learning and discovery is what Desmond Morris called happiness.

Translated by Steve Herrick from the original (in Spanish).

Download: MOLOCH: Mass-Production Industry as a Statist Construct.

I. The Origins of Sloanist Mass Production

A Fork in the Road
A Wrong Turn
The Role of the State in Tipping the Balance

II. The Institutional Imperatives of Sloanism

Economies of Scale, Economies of Speed, and Push Distribution
Microeconomic Institutional Forms for Providing Stability
Mass Consumption to Absorb Surplus
Political Capitalism
State Action to Absorb Surplus: Imperialism
State Action to Absorb Surplus: Creation of New Industries

III. Conclusion

Alfred Chandler, like Galbraith, was thoroughly sold on the greater efficiencies of the large corporation. He argued that the modern multi-unit enterprise arose when administrative coordination “permitted” greater efficiencies. [45]

By linking the administration of producing units with buying and distributing units, costs for information on markets and sources of supply were reduced. Of much greater significance, the internalization of many units permitted the flow of goods from one unit to another to be administratively coordinated. More effective scheduling of flows achieved a more intensive use of facilities and personnel employed in the processes of production and so increased productivity and reduced costs. [46]

Organizationally, output was expanded through improved design of manufacturing or processing plants and by innovations in managerial practices and procedures required to synchronize flaws and supervise the work force. Increases in productivity also depend on the skills and abilities of the managers and the workers and the continuing improvement of their skills over time. Each of these factors or any combination of them helped to increase the speed and volume of the flow, or what some processors call the “throughput,” of materials within a single plant or works…. [47]

Integration of mass production with mass distribution afforded an opportunity for manufacturers to lower costs and increase productivity through more effective administration of the processes of production and distribution and coordination of the flow of goods through them. Yet the first industrialists to integrate the two basic sets of processes did not do so to exploit such economies. They did so because existing marketers were unable to sell and distribute products in the volume they were produced. [48]

The mass-production factory achieved “economies of speed” from “greatly increasing the daily use of equipment and personnel.” [49] (Of course, Chandler starts by assuming the greater inherent efficiency of capital-intensive modes of production, which then require “economies of speed” to reduce unit costs from the expensive capital assets).

What Chandler meant by “economies of speed” was entirely different from lean production’s understanding of flow. Chandler’s meaning is suggested by his celebration of the new corporate managers who “developed techniques to purchase, store, and move huge stocks of raw and semifinished materials. In order to maintain a more certain flow of goods, they often operated fleets of railroad cars and transportation equipment.” [50] In other words, both the standard Sloanist model of enormous buffer stocks of unfinished goods, and warehouses full of finished goods awaiting orders — and the faux “lean” model in which inventory is swept under the rug and moved into warehouses on wheels and in container-ships.

(The reader may be puzzled or even annoyed by my repeated use of the term “Sloanism.” I got it from the insightful commentary of Eric Husman at GrimReader blog, in which he treats the production and accounting methods of General Motors as paradigmatic of 20th century American mass-production industry, and contrasts them with the lean methods popularly identified with Taichi Ohno’s Toyota production system.)

“Sloanism” refers, in particular, to the management accounting system identified with General Motors. It was first developed by Brown at DuPont, and brought to GM when DuPont acquired a controlling share of the company and put Alfred Sloan in charge. Brown’s management accounting system, whose perverse incentives are dissected in detail by William Waddell and Norman Bodek in Rebirth of American Industry, became the basis of the Generally Accepted Accounting Principles (GAAP) that prevail throughout American corporate management.

In Sloanist management accounting, inventory is counted as an asset “with the same liquidity as cash.” Regardless of whether a current output is needed to fill an order, the producing department sends it to inventory and is credited for it. Under the practice of “overhead absorption,” all production costs are fully incorporated into the price of goods “sold” to inventory, at which point they count as an asset on the balance sheet.

With inventory declared to be an asset with the same liquidity as cash, it did not really matter whether the next ‘cost center,’ department, plant, or division actually needed the output right away in order to consummate one of these paper sales. The producing department put the output into inventory and took credit. [51]

…Expenses go down…, while inventory goes up, simply by moving a skid full of material a few operations down the stream. In fact, expenses can go down and ROI can improve even when the plant pays an overtime premium to work on material that is not needed; or if the plant uses defective material in production and a large percentage of the output from production must be scrapped. [52]

In other words, by the Sloanist accounting principles predominant in American industry, the expenditure of money on inputs is by definition the creation of value. As Waddell described it at his blog,

companies can make a bunch of stuff, assign huge buckets of fixed overhead to it and move those overheads over to the balance sheet, making themselves look more profitable.

It’s a system summed up perfectly by Paul Goodman’s notion of the culture of cost-plus. And as Waddell points out, the GDP as a metric depends on the same GAAP assumptions as American industry: it counts expenditure on inputs, by definition, as the creation of wealth. [53] The American corporate economy is governed by a set of metrics much like that of the Soviet planned economy. A given “output” represents an economic value equal to the inputs it consumes, regardless of whether anyone actually wants the output, whether they work, or whether they could have been produced with a fraction of the inputs.

American factories frequently have warehouses filled with millions of dollars worth of obsolete inventory, which is still there “to avoid having to reduce profits this quarter by writing it off.” When the corporation finally does have to adjust to reality, the result is costly write-downs of inventory.

It did not take much of a mathematician to figure out that, if all you really care about is the cost of performing one operation to a part, and you were allowed to make money by doing that single operation as cheaply as possible and then calling the partially complete product an asset, it would be cheaper to make them a bunch at a time.

It stood to reason that spreading set-up costs over many parts was cheaper than having to set-up for just a few even if it meant making more parts than you needed for a long time. It also made sense, if you could make enough parts all at once, to just make them cheaply, and then sort out the bad ones later.

Across the board, batches became the norm because the direct cost of batches was cheap and they could be immediately turned into money — at least as far as Mr. DuPont was concerned — by classifying them as work-in-process inventory. [54]

Under the Sloan system, if a machine can be run at a certain speed, it must be run at that speed to maximize efficiency. And the only way to increase efficiency is to increase the speed at which individual machines can be run. [55] The Sloan system focuses, exclusively, on labor savings “perceived to be attainable only through faster machines. Never mind that faster machines build inventory faster, as well.” [56]

The lean approach has its own “economies of speed,” but they are the direct opposite of the Sloanist approach. The Sloanist approach focuses on maximizing economies of speed in terms of the unit cost of a particular machine, without regard to the inventories of unfinished goods that must accumulate as buffer stocks as a result, and all the other enormous eddies in the flow of production. As the authors of Natural Capitalism put it, it attempts to optimize each step of the production process in isolation, “thereby pessimizing the entire system.” A machine can reduce the labor cost of one step by running at enormous speeds, and yet be out of sync with the overall process. [57] Waddell and Bodek give the example of Ernie Breech, sent from GM to “save” Ford, demanding a plant manager tell him the cost of manufacturing the steering wheel so he could calculate ROI for that step of the process. The plant manager was at a loss trying to figure out what Breech wanted: did he think steering wheel production was a bottleneck in production flow, or what? But for Breech, if the unit cost of that machine and the direct cost of the labor working it were low enough compared to the “value” of the steering wheels “sold” to inventory, that was all that mattered. Under the Sloan accounting system, producing a steering wheel — even in isolation, and regardless of what was done with it or whether there was an order for the car it was a part of — was a money-making proposition. “Credit for that work — it looks like a payment on the manufacturing budget — is given for performing that simple task because it moves money from expenses to assets. [58]

The lean approach, in contrast, gears production flow to orders, and then sizes individual machines and steps in the production process to the volume of overall flow. Under lean thinking, it’s better to have a less specialized machine with a lower rate of output, in order to avoid an individual step out of proportion to the overall production flow. This is what the Toyota Production System calls takt: pacing the output of each stage of production to meet the needs of the next stage, and pacing the overall flow of all the stages in accordance with current orders. [59] In a Sloan factory, the management would select machinery to produce the entire production run “as fast as they humanly could, then sort out the pieces and put things together later.” [60]

To quote the authors of Natural Capitalism again: “The essence of the lean approach is that in almost all modern manufacturing,”

the combined and often synergistic benefits of the lower capital investment, greater flexibility, often higher reliability, lower inventory cost, and lower shipping cost of much smaller and more localized production equipment will far outweigh any modest decreases in its narrowly defined “efficiency” per process step. It’s more efficient overall, in resources and time and money, to scale production properly, using flexible machines that can quickly shift between products. By doing so, all the different processing steps can be carred out immediately adjacent to one another with the product kept in continuous flow. The goal is to have no stops, no delays, no backflows, no inventories, no expediting, no bottlenecks, no buffer stocks, and no muda [waste]. [61]

The contrast is illustrated by a couple of examples from Natural Capitalism: an overly “efficient” grinding machine at Pratt & Whitney, and a cola bottling machine likewise oversized in relation to its task:

The world’s largest maker of jet engines for aircraft had paid $80 million for a “monument” — state-of-the-art German robotic grinders to make turbine blades. The grinders were wonderfully fast, but their complex computer controls required about as many technicians as the old manual production system had required machinists. Moreover, the fast grinders required supporting processes that were costly and polluting. Since the fast grinders were meant to produce big, uniform batches of product, but Pratt & Whitney needed agile production of small, diverse batches, the twelve fancy grinders were replaced with eight simple ones costing one-fourth as much. Grinding time increased from 3 to 75 minutes, but the throughput time for the entire process decreased from 10 days to 75 minutes because the nasty supporting processes were eliminated. Viewed from the whole-system perspective of the complete production process, not just the grinding step, the big machines had been so fast that they slowed down the process too much, and so automated that they required too many workers. The revised production system, using a high-wage traditional workforce and simple machines, produced $1 billion of annual value in a single room easily surveyable from a doorway. It cost half as much, worked 100 times faster, cut changeover time from 8 hours to 100 seconds, and would have repaid its conversion costs in a year even if the sophisticated grinders were simply scrapped. [62]

In the cola industry, the problem is “the mismatch between a very small-scale operation — drinking a can of cola — and a very large-scale one, producing it.” The most “efficient” large-scale bottling machine creates enormous batches that are out of scale with the distribution system, and result in higher unit costs overall than would modest-sized local machines that could immediately scale production to demand-pull. The reason is the excess inventories that glut the system, and the “pervasive costs and losses of handling, transport, and storage between all the elephantine parts of the production process.” As a result, “the giant cola-canning machine may well cost more per delivered can than a small, slow, unsophisticated machine that produces the cans of cola locally and immediately on receiving an order from the retailer.” [63]

In a genuine lean factory, managers are hounded in daily meetings about meeting the numbers for inventory reduction and reduction of cycle time, in the same way that they’re hounded on a daily basis to reduce direct labor hours and increase ROI in a Sloanist factory. James Womack et al, in The Machine That Changed the World, recount an amusing anecdote about a delegation of lean production students from Corporate America touring a Toyota plant. Reading a question on their survey form as to how many days of inventory were in the plant, the Toyota manager politely asked whether the translator could have meant minutes of inventory. [64]

As Mumford put it, “Measured by effective work, that is, human effort transformed into direct subsistence or into durable works of art and technics, the relative gains of the new industry were pitifully small.” [65] The amount of wasted resources and crystallized labor embodied in the enormous warehouses of Sloanist factories and the enormous stocks of goods in process, the mushrooming cost of marketing, the “warehouses on wheels,” and the mountains of discarded goods in the landfills that could have been repaired for a tiny fraction of the cost of replacing them, easily outweigh the savings in unit costs from mass production itself. The cost savings from mass production are more than offset by the costs of mass distribution.

Chandler’s model of production resulted in the adoption of increasingly specialized, asset-specific production machinery:

The large industrial enterprise continued to flourish when it used capital-intensive, energy-consuming, continuous or large-batch production technology to produce for mass markets. [66]

The ratio of capital to labor, materials to labor, energy to labor, and managers to labor for each unit of output became higher. Such high-volume industries soon became capital-intensive, energy-intensive, and manager-intensive. [67]

Of course this view is fundamentally wrong-headed. To regard a particular machine as “more efficient” based on its unit costs taken in isolation is sheer idiocy. If the costs of idle capacity are so great as to elevate unit costs above those of less specialized machinery, at the levels of spontaneous demand occurring without push marketing, and if the market area required for full utilization of capacity results in distribution costs greater than the unit cost savings from specialized machinery, then the expensive product-specific machinery is, in fact, less efficient.

Galbraith and Chandler wrote as though the adoption of the machinery were enough to automatically increase efficiency, in and of itself, regardless of how much money had to be spent elsewhere to “save” that money.

But if we approach things from the opposite direction, we can see that flexible manufacturing with easily redeployable assets makes it feasible to shift quickly from product to product in the face of changing demand, and thus eliminates the imperative of controlling the market. As Barry Stein said,

if firms could respond to local conditions, they would not need to control them. If they must control markets, then it is a reflection of their lack of ability to be adequately responsive. [68]

…Consumer needs, if they are to be supplied efficiently, call increasingly for organizations that are more flexibly arranged and in more direct contact with those customers. The essence of planning, under conditions of increasing uncertainty, is to seek better ways for those who have the needs to influence or control the productive apparatus more effectively, not less.

Under conditions of rapid environmental change, implementing such planning is possible only if the “distance” between those supplied and the locus of decision-making on the part of those producing is reduced…. But it can be shown easily in information theory that the feedback — information linking the environment and the organization attempting to service that environment — necessarily becomes less accurate or less complete as the rate of change of data increases, or as the number of steps in the information transfer process continues.

Stein suggested that Galbraith’s solution was to suppress the turbulence: “to control the changes, in kind and extent, that the society will undergo.” [69] But far better, he argues, would be “a value shift that integrates the organization and the environment it serves.”

This problem is to be solved not by the hope of better planning on a large scale…, but by the better integration of productive enterprises with the elements of society needing that production.

Under conditions of rapid change in an affluent and complex society, the only means available for meeting differentiated and fluid needs is an array of producing units small enough to be in close contact with their customers, flexible enough to produce for their demands, and able to do so in a relatively short time…. It is a contradiction in terms to speak of the necessity for units large enough to control their environment, but producing products which in fact no one may want! [70]

As to the problem of planning — large firms are said to be needed here because the requirements of sophisticated technology and increasingly specialized knowledge call for long lead times to develop, design, and produce products. Firms must therefore have enough control over the market to assure that the demand needed to justify that time-consuming and costly investment will exist. This argument rests on a foundation of sand; first, because the needs of society should precede, not follow, decisions about what to produce, and second, because the data do not substantiate the need for large production organizations except in rare and unusual instances, like space flight. On the contrary, planning for social needs requires organizations and decision-making capabilities in which the feedback and interplay between productive enterprises and the market in question is accurate and timely — conditions more consistent with smaller organizations than large ones. [71]

In short, mass production requires supply-push distribution to guarantee a market before production takes place.

Although Galbraith and Chandler commonly justified the corporation’s power over the market in terms of its social benefits, they had things exactly backward. The “technostructure” can survive because it is enabled to be less responsive to consumer demand. An oligopoly firm in a cartelized industry, in which massive, inefficient bureaucratic corporations share the same bureaucratic culture, is protected from competition. The “innovations” Chandler so prizes are able to succeed because they are determined by the organization for its own purposes, and the organization has the power to impose top-down “change” on a cartelized market, with little regard to consumer preferences, instead of responding flexibly to them. The large corporate organization is not more efficient at accomplishing goals received from outside; it is more efficient at accomplishing goals it sets for itself for its own purposes, and then using its power to adapt the rest of society to those goals.

So to turn to our original point, the apostles of mass production have all, at least tacitly, identified the superior efficiency of the large corporation with its control over the external environment. Sloanist mass production subordinates the consumer, and the rest of outside society, to the institutional needs of the corporation.

Chandler himself admitted as much, in discussing what he called a strategy of “productive expansion.” Big business added new outlets that permitted it to make “more complete use” of its “centralized services and facilities.” [72] In other words, “efficiency” is defined by the existence of “centralized facilities,” as such; efficiency is then promoted by finding ways to make people buy the stuff the centralized facilities can produce running at full capacity. These theories amount, in practice, to a circular argument that oligopoly capitalism is “successful” because it is most efficient at achieving the ends of oligopoly capitalism. Chandler’s version of “successful development” is a roaring success indeed, if we start with the assumption that society should be reengineered to desire what the technostructure wants to produce.

Notes: 

45. Chandler, The Visible Hand, p. 6.

46. Ibid., pp. 6-7.

47. Ibid., p. 241.

48. Ibid., p. 287.

49. Ibid., p. 244.

50. Ibid., p. 412.

51. Waddell and Bodek, p. 75.

52. Ibid., p. 140.

53. William Waddell, “The Irrelevance of the Economists,” Evolving Excellence, May 6, 2009
<http://www.evolvingexcellence.com/blog/2009/05/the-irrelevance-of-the-economists.html>.

54. Waddell and Bodek, p. 98.

55. Ibid., p. 122.

56. Ibid., p. 119.

57. Paul Hawken, Amory Lovins, and L. Hunter Lovins, Natural Capitalism: Creating the Next Industrial Revolution (Boston, New York, London: Little, Brown, and Company, 1999), pp. 129-30.

58. Waddell and Bodek, pp. 89, 92.

59. Ibid., pp. 122-123.

60. Ibid., p. 39.

61. Hawken et al, pp. 129-130.

62. Ibid., pp. 128-129.

63. Ibid., p. 129.

64. James P. Womack, Daniel T. Jones, Daniel Roos, The Machine That Changed the World (New York: MacMillan, 1990), p. 80.

65. Mumford, Technics and Civilization, p. 196.

66. Ibid., p. 347.

67. Ibid., p. 241.

68. Barry Stein, Size, Efficiency, and Community Enterprise (Cambridge: Center for Community Economic Development, 1974), p. 41.

69. Ibid., p. 43.

70. Ibid., p. 44.

71. Ibid., p. 58.

72. Chandler, The Visible Hand, p. 487.

“As Apple prepares to defend itself against a multi-billion dollar patent infringement claim in Europe,” reports Apple Insider, “the company has aligned with rival Google in asking the U.S. Supreme Court to allow stiffer penalties for patent trolls who bring frivolous lawsuits.”

Well, it’s about time. But the problem with Apple’s position is that there’s no such thing as a patent lawsuit … or for that matter, a patent … that isn’t frivolous (“not serious in content or attitude or behavior”).

It’s true that patent litigation has become more and more visibly silly over the last few years, but as a major player in the silliness (having, among other idiocies, applied for — and received! — a patent on rectangular devices with rounded corners) Apple doesn’t have much standing to complain about that. There’s not enough room in this column to really go into Apple’s other “intellectual property” howlers, but let’s name two:

Their flagship Macintosh line began as a lock, stock and barrel copy, from user interface to peripherals (ever heard of a “mouse?”), of Xerox’s 1981 Star terminal system. And they briefly sued (before settling with) Amazon over “rights” to the words “app store.” So please, let us break out the world’s smallest violin  for Apple’s angst over “patent trolls.”

Even if patents actually accomplished their advertised purpose — “securing for limited Times to … Inventors the exclusive Right to their … Discoveries,” as the US Constitution puts it — they’d be a very bad idea. The claim that one can own an idea is silly on its face, and not a claim that anyone would pay the slightest mind to were it not enforced at gunpoint by the state.

But the advertised purpose of patents is not their actual purpose.

Their actual purpose is to restrain competition and limit innovation so as to provide economic advantage — monopoly pricing power, in fact — to established firms who, by virtue of their ability to pay off (pardon my indelicate language; I believe the word I’m looking for is “lobby”) politicians, bureaucrats and judges, can thereby indulge their desire avoid market competition on price or quality.

Decades ago, I worked for a well-known boat manufacturer. One summer, I spent several weeks as the “menial tasks” guy — hauling boats and trailers back and forth for modifications, that kind of thing — for the company’s newly hired boat designer as he worked to assemble a prototype “different enough” from the last boat he’d designed (for another firm) to avoid (or at least successfully fight) “infringement” claims. I don’t know how much this “patent compliance” runaround (and any ensuing litigation) added to the cost of each unit of the new boat, but there’s no doubt that it did affect the retail price.

In other words, patents are indirect taxes on consumers. Patent monopolists can charge higher prices because government suppresses their would-be competitors for them. And if those competitors do manage to bring products to market, those products are also more expensive because they’ve had to spend money on patent licensing, or on patent research to avoid “infringement,” or on insurance to protect themselves against patent litigation.

Apple’s complaint, in its essentials, is that patent “trolls” just buy up patent “rights,” then search for infringement to cash in on, rather than going to the trouble of making real products. But why shouldn’t they do that? If, as Apple would have us believe, patents are a legitimate market instrument, then the “trolls” are just exploiting that instrument more efficiently than Apple cares to, right?

The problem isn’t “patent trolls.” The problem is patents.

Translations for this article:

• Italian, Il Problema non sono i Patent Troll. Il Problema Sono i Brevetti.
• French, Les « trolls de brevets » ne sont pas le problème. Les brevets sont le problème.

C4SS has teamed up with the Distro of the Libertarian Left. The Distro produces and distribute zines and booklets on anarchism, market anarchist theory, counter-economics, and other movements for liberation. For every copy of Oscar Wilde’s “The Soul of Man Under Socialism” that you purchase through the Distro, C4SS will receive a percentage. Support C4SS with Oscar Wilde’s “The Soul of Man Under Socialism“.

$2.00 for the first copy. $1.00 for every additional copy.

Originally circulated in 1891 as a privately printed book, by the world-renowned gay Anglo-Irish Aesth­et­icist poet, play­wright and critic Oscar Wilde (1854-1900). Wilde declared himself an anarchist following his encounter with the Russian expatriate anarchist Peter Kropotkin. His artistic work, and his later persecution, trial and imprisonment for his sexual relationships with male lovers were widely and sympathetically discussed in the Anarchist press during the 1890s, and his Anarchist writings were later reprinted by Emma Goldman and Alex­ander Berkman’s Mother Earth publishing company. The essay offers a fascinating exploration of the cultural impacts of anarchistic socialism and individualism — not as a tearing-down of all in the name of rigidly formal equality, but rather a liberating opportunity for all to fully express what makes them unique, and and flourish in their idiosyncrasy.

“We are often told that the poor are grateful for charity. Some of them are, no doubt, but the best amongst the poor are never grateful. They are un­grate­ful, dis­con­tent­ed, disobedient, and rebellious. They are quite right to be so. Charity they feel to be a ridiculous­ly in­ade­qu­ate mode of partial rest­it­ut­ion, or a sentimental dole, usually ac­com­panied by some im­pert­i­n­ent attempt of the senti­mentalist to tyrannise over their private lives. Why should they be grateful for the crumbs that fall from the rich man’s table? Dis­obe­d­ience is man’s original virtue. It is through dis­obed­ience that pro­gress has been made, through dis­obed­ience and through rebellion. . . .

“It is clear, then, that no Authoritarian Socialism will do. . . . Under an industrial bar­rack sys­tem, or a system of economic tyranny, nobody would be able to have any such freedom at all. Every man must be left quite free to choose his own work. No form of compulsion must he ex­er­c­is­ed over him. . . . All association must be quite voluntary. It is only in vol­unt­ary associations that man is fine. . . . Socialism itself will be of value simply because it will lead to Individualism.

“Art is Individualism, and Individ­u­alism is a disturbing and disintegrating force. Therein lies its immense val­ue. For what it seeks to disturb is monotony of type, slavery of custom, tyr­an­ny of habit, and the reduction of man to the level of a machine. . . . Self­ish­ness is not living as one wishes to live, it is asking others to live as one wishes to live. And unselfishness is letting other people’s lives alone, not interfering with them. Selfishness always aims at creating around it an absolute uniformity of type. Unselfishness re­cog­nises infinite variety of type as a delightful thing, accepts it, acquiesces in it, enjoys it.”

I recently finished reading the second edition of Chris Matthew Sciabarra’s, Ayn Rand: The Russian Radical. It was a fantastic read and is highly recommended. There is a comprehensive review in the works, but I want to use this blog post to touch on a particular quotation from We the Living. Kira is quoted thus:

I don’t want to fight for the people, I don’t want to fight against the people, I don’t want to hear of the people. I want to be left alone — to live!

This quotation captures a dialectical transcendence of the false dualism between submerging your individuality in an organicist collectivist conception of the people and sacrificing the mass of people. Kira simply wants to be left alone to live in freedom rather than having to choose between fighting for an elite against the people or on behalf of a mass that demands the sacrifice of her individuality.

The question left unanswered is how a left-libertarian should approach this quotation, because we left-libertarians do strive to improve the living standards of the vast majority of people. A left-libertarian could approach it by embracing the message of individual freedom contained therein while still engaging in militant action against elite power structures. The goal is to transcend the collectivism of both elitism and majoritarian estatism.

The above is best accomplished by making sure that revolutionary organization is structured in a way that discourages intrusions upon individual freedom. Left-libertarians are uniquely placed to fight a revolution without sacrificing individual rights in the process. The Marxist states of the 20th century showed what happens when you abandon respect for the individual. Left-libertarians seek to become the left and avoid the mistakes of the past. They can learn from the failed Marxist experience.

Does this mean abandoning all collective action? Not at all. Collective action carried out by autonomous individuals coming together with a shared purpose is eminently libertarian. Collective action is not the same thing as collectivism. The latter is an organcist doctrine that holds that the individual is a mere cell of a social super organism that is an entity unto itself. This is obvious mysticism and not supported by the evidence of the senses. This doesn’t mean that society doesn’t exist. It exists through the individuals that compose it. Kira’s statement is a cry for privacy and individuality within a social context. Let us help to realize her dream and push towards more freedom.

Download: MOLOCH: Mass-Production Industry as a Statist Construct.

I. The Origins of Sloanist Mass Production

A Fork in the Road
A Wrong Turn
The Role of the State in Tipping the Balance

II. The Institutional Imperatives of Sloanism

Economies of Scale, Economies of Speed, and Push Distribution
Microeconomic Institutional Forms for Providing Stability
Mass Consumption to Absorb Surplus
Political Capitalism
State Action to Absorb Surplus: Imperialism
State Action to Absorb Surplus: Creation of New Industries

III. Conclusion

The mass-production model carried some strong imperatives: first, it required large-batch production, running the enormously expensive product-specific machinery at full capacity, to minimize unit costs; and second, it required social control and predictability to ensure that the output would be consumed, lest growing inventories and glutted markets cause the wheels of industry to stop turning. Here’s Lewis Mumford on the principle:

As mechanical methods have become more productive, the notion has grown up that consumption should become more voracious. In back of this lies an anxiety lest the productivity of the machine create a glut in the market….

This threat is overcome by “the devices of competitive waste, of shoddy workmanship, and of fashion…” [34]

As described by Piore and Sabel, the problem was that product-specific resources could not be reallocated when the market shifted; under such conditions, the cost of market unpredictability was unacceptably high. Markets for the output of mass-production industry had to be guaranteed because highly specialized machinery could not be reallocated to other uses with changes in demand. [35]

Mass production was therefore profitable only with markets that were large enough to absorb an enormous output of a single, standardized commodity, and stable enough to keep the resources involved in the production of that commodity continuously employed. Markets of this kind… did not occur naturally. They had to be created. [36]

….It became necessary for firms to organize the market so as to avoid fluctuations in demand and create a stable atmosphere for profitable, long-term investment. [37]

Ralph Borsodi argued that

“[w]ith serial production, … man has ventured into a topsy-turvy world in which goods that wear out rapidly or that go out of style before they have a chance to be worn out seem more desirable than goods which are durable and endurable. Goods now have to be consumed quickly or discarded quickly so that the buying of goods to take their place will keep the factory busy. [38]

With continuous operation of [the factory’s] machinery, much larger quantities of its products must be sold to the public. The public buys normally only as fast as it consumes the product. The factory is therefore confronted by a dilemma; if it makes things well, its products will be consumed but slowly, while if it makes them poorly, its products will be consumed rapidly.

It naturally makes its products as poorly as it dares.

It encourages premature depreciation. [39]

(In a free market, of course, firms that made stuff well would have a competitive advantage. But in our unfree market, the state’s subsidies to inefficiency cost, “intellectual property” laws, and other restraints on competition insulate firms from the full competitive disadvantage of offering inferior products.)

Because of the imperative for overcapitalized industry to operate at full capacity, on round-the-clock shifts, in order to spread the cost of its expensive machinery over the greatest possible number of units of output, the imperative of guaranteeing consumption of the output was equally great.

This is not just a caricature by the enemies of Sloanist mass-production. It has been a constant theme of the model’s most enthusiastic advocates and defenders. They disagree with economic decentralists, not on the systemic requirements of the mass-production model, but only on whether or not it has on the whole been a good thing, and whether there is any viable alternative.

In The New Industrial State, Galbraith wrote about the connection between capital intensiveness and the “technostructure’s” need for predictability and control:

…[Machines and sophisticated technology] require… heavy investment of capital…. They involve, also, a greatly increased lapse of time between any decision to produce and the emergence of a salable product.

From these changes come the need and the opportunity for the large organization. It alone can deploy the requisite capital; it alone can mobilize the requisite skills…. The large commitment of capital and organization well in advance of result requires that there be foresight and also that all feasible steps be taken to insure that what is foreseen will transpire. [40]

…From the time and capital that must be committed, the inflexibility of this commitment, the needs of large organization and the problems of market performance under conditions of advanced technology, comes the necessity for planning. [41]

The need for planning… arises from the long period of time that elapses during the production process, the high investment that is involved and the inflexible commitment of that investment to the particular task. [42]

Planning exists because [the market] process has ceased to be reliable. Technology, with its companion commitment of time and capital, means that the needs of the consumer must be anticipated—by months or years…. [I]n addition to deciding what the consumer will want and will pay, the firm must make every feasible step to see that what it decides to produce is wanted by the consumer at a remunerative price…. It must exercise control over what is sold…. It must replace the market with planning. [43]

…The need to control consumer behavior is a requirement of planning. Planning, in turn, is made necessary by extensive use of advanced technology and capital and by the relative scale and complexity of organization. These produce goods efficiently; the result is a very large volume of production. As a further consequence, goods that are related only to elementary physical sensation–that merely prevent hunger, protect against cold, provide shelter, suppress pain–have come to comprise a small and diminishing part of all production. Most goods serve needs that are discovered to the individual not by the palpable discomfort that accompanies deprivation, but by some psychic response to their possession…. [44]

For Galbraith, the “accepted sequence” of consumer sovereignty, in which consumer demand determines what is produced, was replaced by a “revised sequence” in which oligopoly corporations determine what is produced and then dispose of it by managing consumer behavior. In contemporary terms, the demand-pull economy is replaced by a supply-push model.

Notes: 

34. Mumford, Technics and Civilization, pp. 396-397.

35. Piore and Sabel, p. 50.

36. Ibid., p. 49.

37. Ibid., p. 54.

38. Ralph Borsodi, This Ugly Civilization (Philadelphia: Porcupine Press, 1929, 1975), pp. 64-65.

39. Ibid., p. 126.

40. John Kenneth Galbraith, The New Industrial State (New York: Signet Books, 1967), p. 16

41. Ibid., p. 28.

42. Ibid., p. 31.

43. Ibid., pp. 34-35.

44. Ibid., pp. 210-212.

Speaking at the United Nations in 2006, Hugo Chávez excoriated ex- US President George W. Bush as “the devil.” Chávez waved a copy of Noam Chomsky’s Hegemony or Survival: America’s Quest for Global Dominance, catapulting the book onto Amazon’s best-seller list.

For his part, Chomsky has repeatedly stated that Chávez ushered a revolutionary break with Venezuela’s political past, especially regarding the social policies of the state toward the poor, echoing the foundational Chavista discourse of “Bolivarian revolution.”

In an interview with Spanish newspaper Diagonal in March 2006, Chomsky declared that “for the first time, the country is using … energy resources for its development … in construction, health …” Likewise, in a 2005 op-ed for Mexico’s La Jornada, he wrote “it is only now with President Chávez … [that] medicine has become something real for a majority of the poor.”

Last month, speaking to Venezuelan economist Miguel Ángel Santos, Chomsky repeated his point: “For many years Venezuela was dominated by elites that … harvested all the benefits from the oil bonanzas while marginalizing the poor … Chávez came up against that …”

Regrettably, Chomsky ignores basic facts of Venezuelan contemporary history. There is nothing revolutionary about the Chavista welfare state.

In Revolution as Spectacle, Rafael Uzcátegui, co-editor of Venezuelan anarchist newspaper El Libertario, presents reams of data showing that up until the early 80’s, when oil prices started a sustained decline that drained the Venezuelan state’s capacity to sustain the massive subsidies that appeased the masses since 1958 and ultimately led to the Caracazo (a wave of riots in 1989 where thousands were killed by the military under the second administration of Carlos Andrés Pérez) welfare policies were as ubiquitous, and at times more effective, than those of Chávez’s reign.

Let’s limit our look to the two areas mentioned by Chomsky, housing and health care (Uzcátegui applies a similar analysis to a wide range of welfare policies).

According to national census data, the state’s housing projects reduced shanty-town dwellings as a percentage of total housing from 37.18% in 1961 to 12.56% in 1990. Penetration of the electricity grid was 58.16% in 1961 and 76.59% in 1981. Access to running water increased from 46.7% in 1961 to 68.74% in 1981.

The Chávez administration built an average of of 26,000 households per year between 1999 and 2008. The average for the 90s decade was a much higher 64,000 per year.

The Popular Clinics and Hospitals of the People created by the famous Barrio Adentro Mission, a program widely publicized as having secured hitherto unparalleled access to basic health care for the poor, are today unable to provide treatment for any ailment more complex than a broken bone.

For critical treatments, the people must rely on the old hospital network built during the Fourth Republic, which in 1980 reached one of the widest coverages of the region with 2.7 beds per thousand habitants, but today is basically in shambles.

This translated, among other tragedies, into poor women in Venezuela giving birth under inhuman conditions during the period 1998-2008, and a 16% rate of maternal deaths due to clandestine abortions for 2010.

The flip side of Chomsky’s argument, that Venezuela before Chávez was dominated by elites harvesting most of the oil bonanza, is true, but irrelevant: Today’s Venezuela is still dominated by brave new elites, the so called boliborgoise, wealthy and powerful thanks to their connections to, or direct participation in, the all-powerful Bolivarian state.

Actually, the Chavista elite is much more corrupt, authoritarian and inept than their Fourth Republic predecessors. If the monopoly on the use of force and administration of justice is the defining feature of the state, Venezuela today can easily be described as a failed one: The country’s epidemic of violence netted almost 25,000 murders in 2013, more than 90% unsolved.

Hugo Chávez was no revolutionary. He simply took the petro-statist social democratic model prevailing in Venezuela since 1958 to a whole new level. As Uzcátegui argues in his book, he masterfully executed the art of the demagogic spectacle like no one before him — spectacle that utterly mesmerized Noam Chomsky, despite his analytical and intellectual prowess.

Translations for this article:

• Spanish, Noam Chomsky, Deslumbrado por el Espectáculo Bolivariano.
• Portuguese, Noam Chomsky: fascinado pelo espetáculo bolivariano.