On August 26th, C4SS’s Sheldon Richman appeared on The Scott Horton Show to discuss libertarian class analysis, its roots, and the contemporary class divide. The interview is about 28 minutes.

Oath Keeper presence in Ferguson has been an issue boiling beneath the surface since the 2014 riots. Members began showing up when community hostility spilled over into the streets; Oath Keepers appointed themselves protectors of Ferguson property from looters. Reception was mixed, but some members of the community welcomed them and allowed them to patrol their storefronts. Now in August 2015, they’ve returned with divided intentions. Some showed up once again as an ostensive private security force while others had a more symbolic goal in mind. The Missouri Chapter of Oath Keepers want to arm 50 black protesters with AR-15s.

The Oath Keepers are known to be a decentralized lot, not always fitting the mold of the typical militia group of white guys playing paramilitary in the woods. However, this proposed demonstration has drawn the ire of the national Oath Keepers leadership. They don’t want to see guns handed out to people in the streets. As a result, many involved in the protest, including chief organizer Sam Andrews, have broken with the national leadership.

Stewart Rhodes, founder of Oath Keepers, sides with the leadership and with the many furious emails he claims to have received from gun rights advocates. Rhodes wants to avoid the perception that he’s arming “rioters.” Andrews has not minced words, responding that those against the protest are simply bigoted: “The law enforcement side of [Rhodes’s] board and membership are racist, and he does not want to lose their money.” The Oath Keepers were a large presence at the Bundy Ranch standoff in 2014. Andrews claims their willingness to cooperate with a decentralized armed resistance there but not in Ferguson demonstrates his point.

Rhodes claims to be on the same anti-police state side of politics as Andrews. But in 2014, Rhodes said of his organization’s presence in Ferguson: “We thought they were going to do it right this time, but when Monday rolled around and they didn’t park the National Guard at these businesses, that’s when we said we have got to do something.” National Guard? Sounds like someone who was itching for any kind of occupying force in Ferguson. Rhodes sees the Oath Keepers not as an organization opposing a police state, but as a more efficient alternative to one.

The foundation of Oath Keepers has always been to provide a space for cops and military to rally around a particular interpretation of the Constitution. They are not for a self-policing citizenry, but for policing within the bounds of the Constitution. They are not opposed to any particular law except when it violates the Constitution. No doubt this sort of philosophy might result in a more agreeable legal regime, but constitutionalism in and of itself doesn’t necessarily equate to freedom and equality. It is far from a self-enforcing document.

The Constitution fostered, among many other horrors, slave patrols. This is an uncomfortable fact for anyone proclaiming loyalty to it. It should be of particular concern to a group made up largely of white men whose task has been to monitor the behavior of a black community. However, Andrews’s move is a welcome break with this uncomfortable history. Andrews’s brand of activism does not seek to govern or establish a militia for the sake of asserting constitutional rights, but instead to remedy an imbalance of power.

The problem with Rhodes’s philosophy should be apparent to anyone who believes gun ownership stems from more than just a constitutional basis. Rhodes wants a militia, town guards, and, as white men since the founding of this nation and before have wanted, to control the means of defense in the hands of black people. Sam Andrews, for whatever faults exist in his philosophy, isn’t interested in this paternalistic approach. What makes his protest so powerful is that it’s not some scheme to get the weapons in the hands of the right people. That is, after all, how we got the police. He is handing over the power of a rifle to men and women who we, as a society, have stripped of the right to self-determination.

Andrews says he believes he has an obligation to protect the weak. Instead of standing on a rooftop with his own rifle, he is offering the purest form of protection — self-defense.

The split within Oath Keepers represents a push by some to shed the group’s colonial mindset. Rather than impose a new (or a return to a much older) regime, Andrews wants to break with imposed orders. The last thing Ferguson needs is organized white authority dictating their terms of “freedom.” External plans for freedom only establish the walls of a new prison.

We don’t need plans, rulebooks, oaths, or new patrolmen to protect us. All we need is for dictatorial governing bodies like Oath Keepers and the state to step aside and let us govern and defend ourselves.

Philip Giraldi discusses whether Iranian weapons are really killing American soldiers or not.

Ted Galen Carpenter discusses the U.S. government’s love of dictators.

David Gordon discusses the notion of libertarian paternalism.

Gene Healy discusses who the most militarist of the candidates is.

Robert Golan-Vilella discusses law in a time of endless war.

Matt Peppe discusses Carter’s bloodstained legacy.

Neve Gordon discusses forced feeding in Israel.

Dr. Ramzy Baroud discusses the refugee crisis resulting from the 2011 Libyan War.

Joseph Stromberg discusses America as the neo-British empire.

Lucy Steigerwald discusses Ron Paul’s new book via an interview with him.

Justin Raimondo discusses the return of Judith Miller.

David Bromwich discusses the return of the neoconservative empire.

Nick MacWilliam discusses U.S. support for Pinochet’s head of secret police.

Jonathan Marshall discusses the Honduran coup’s ugly aftermath.

Laurence M. Vance discusses GOP hypocrisy on Planned Parenthood.

James Bovard discusses Eric Holder’s legacy.

Vic Allen reviews a book on U.S. military basing.

Maggie McNeill discusses sex work decriminalization.

Ivan Eland discusses presidents who’ve exceeded their historical reputations.

Dan Sanchez discusses the militarization of the superhero.

John C. O’Day discusses giving war a chance.

Paul Mueller discusses Adam Smith on sympathy.

Richard M. Ebeling discusses the free market vs the bureaucratic state.

Jacob G. Hornberger discusses Hitler, Mussolini, Khrushchev, and Trump.

Sam Husseini discusses Bernie Sander’s take on Saudi intervention in Yemen.

Ramzy Baroud discusses upcoming wars in Libya.

Jonathan Cook discusses Israel’s thug at the UN.

Nicola Perugini and Neve Gordon discuss a case before the Israeli Supreme Court.

Jacob G. Hornberger discusses libertarianism and immigration policy.

Sheldon Richman discusses Donald Trump’s views on trade.

Presidential contender and “progressive” hero Bernie Sanders has been rightfully criticized for his support of the Violent Crime Control and Law Enforcement Act. The act, also known as the “Biden Crime Bill,” dramatically increased police presence and funding, banned “assault weapons,” and created strict new sentencing guidelines.

Somehow Sanders has managed to escape criticism for a similarly bad piece of legislation he supported — the Local Law Enforcement Against Hate Crimes Act — another virtual gift bag for police departments. Hate crime legislation is often accepted as a net gain for minority communities. But in today’s over-criminalized, over-incarcerated, police state, the last thing we need is a new excuse to lock people up, no matter how feel-good hate crime legislation might seem.

While Sanders claims to oppose mandatory minimum sentences, his support for these two draconian bills shows he’s just fine with the status quo so long as he can apply some lipstick to it.  The increased sentencing regimes created by these acts further solidifies a permanent prisoner class. This does not look like opposition to an out of control criminal justice system; it appears more like an endorsement of the criminal justice system when it suits Bernie’s surface-level political agenda.

However well-intentioned his support for this increased sentencing power may be, it fuels mass incarceration, plain and simple. Longer sentences for those convicted of hate crimes gains communities of color nothing except a legislative and judicial spectacle. In many cases, it is members of minority communities who are locked up for longer terms by these sorts of laws.

Moreover, an increase in the population of bigots in the prison system doesn’t help those already stuck there, many of whom don’t belong. Sanders occasionally acknowledges the ongoing injustice perpetrated on those incarcerated for nonviolent drug offenses. But new hate crime laws can only hurt these people, the forgotten victims. Too often, “progressives” forget about the suffering of these people and their right to be protected. Do they really need to be introduced to a new class of cellmates?

Sanders says he wants to end the use of private prisons. But how does he expect to accomplish this while supporting longer sentences for his “pet” crimes?

It’s also worth noting that mass incarceration isn’t just the result of the profit motive underlying private prisons. It’s an extension of the state’s desire for authority and control — an age old problem. That a privileged class of prison industrialists now benefits financially from the state’s power lust doesn’t change the root issue. Anyone who wants to end the corrupt criminal justice system needs to first address the state’s executive role in it.

Hate crime laws, like all other new criminalization, grants more resources and power to police departments. That they are for a supposedly noble purpose does not stop law enforcement from using them maliciously. Could the slave patrols of the South have been trusted with resources granted to them for the purpose of protecting slaves from unnecessarily cruel masters?

Hate crime legislation diverts precious resources from oppressed communities and transfers them into the hands of the powerful. The funds used to propose, pass, and execute the terms of hate crime legislation are funds stolen from the public, including communities of color, who are often then victimized by the very institutions putting their bounty to use. The parasitic nature of the state and law enforcement weakens the financial and social stability of those it claims to protect. Enough is enough. Return the multi-billions of dollars looted from taxpayers for programs like the Biden Crime Bill and the Hate Crimes Act to their rightful owners. Empower communities to make the changes that no government ever can.

We need to eliminate the middle men playing both sides of the fence. The state and its vast enforcement arm play the dual role of protector and attacker. Restorative and transformative methods of justice must be emphasized by anyone campaigning as an advocate of black lives and the lives of other marginalized communities. For what use is talking about black lives if all we’re doing is enacting white punishment?

The Bible Reloaded is a Youtube channel, in which hosts Hugo and Jake review films, kids shows, religious comics and more from an atheistic, secular humanist perspective. Their work tends to be humorous and the targets of their criticism are often religious films. They watch these Mystery Science Theater style and comment on bad acting, low production quality or mixed up moral messages. On August 21st, the duo posted a review of the film Audacity by Christian evangelist Ray Comfort. The film, in short, encourages anti-gay Christians not to compromise their bigotry.

Comfort, who is most well known outside of religious circles for arguing that Bananas prove the existence of God (in part because of their pointed tip for “ease of entry”), also has a reputation for using copyright claims to take down works criticizing his output. The intended purpose of copyrights and patents, namely suppressing competition through the creation of government granted monopolies, is harmful enough. However, the use of intellectual property laws also serves the devious purpose of stifling free speech and criticism, as seen in Comfort’s case. Jake and Hugo knew this when making their review, and they took the precaution of using hand-drawn images and stock photos instead of visuals from the film. They explicitly state this at the beginning of their review, and note that while their usual technique of using film clips for a review is protected under the fair use doctrine, it is simply not worth the risk associated with being accused of copyright infringement.

This is particularly important for YouTube users. YouTube deletes channels that receive three copyright strikes, effectively meaning a loss of income for content creators. Even a single strike revokes a channel’s live broadcasting privileges and its ability to post videos over 15 minutes long. YouTube takes copyright claims seriously, and they can hardly be blamed as copyrights are enforced through government coercion. Unfortunately, anyone can file a claim against a YouTube Channel, and the company largely treats the accused as guilty until proven innocent.

Ray Comfort’s company Living Waters Publications chose to make a Digital Millenium Copyright Act complaint against The Bible Reloaded’s review of his film, causing YouTube to take down the video and issue a strike against its creators. Hugo and Jake took to Twitter to publicize the matter. Friends of theirs in the atheist blogosphere such as JT Eberhard of What Would JT Do? and Hemant Mehta of Friendly Atheist also got involved. As a result, Living Waters Publications received widespread public criticism. To quote Hugo and Jake, “This got resolved pretty much through the community, almost as quickly as it happened.” Ultimately Ray Comfort was contacted and he reversed the claim, stating he did not know why it was filed. Whether he did this out of fear of the legal penalties for making a fraudulent DMCA (perjury), personal benevolence, or simply due to the pressures of bad publicity is open to speculation. Thankfully, it was resolved without the threats of violence that often characterize internet related conflicts.

While the state’s copyright policies stifle the free flow of information and create ugly abuses, closely-knit online online communities allow victims of the abuses to fight back. The relatively free flow of online information does much to keep bad behavior in check. Hopefully this incident will open people’s eyes to the problem with copyright in general, as well as YouTube’s reactionary IP policies.

Life is pretty good here in the Volunteer State. As an East Tennessean I am particularly fond of the great Smoky Mountains, my scruffy little city of Knoxville, the University of Tennessee and surrounding colleges, a multitude of markets (including a rising craft beer scene) and an array of state parks. Just the other weekend my family and I, accompanied by some close friends, made our way out to Frozen Head State Park. Here, on a rather cool August afternoon, we built camp under Hemlock, Oak and Poplar, cooked over embers, played in the cool, trickling waters of Flat Fork and enjoyed our child’s laughter on his first overnight adventure in the Cumberland forest.

I live for these moments. Simple, quick escapes into the wild. It is a good break from the trials of the week. As an instructor of Natural and Behavioral Science at a local community college, it is nice to run into nature, sit, breathe and enjoy her complexity. It recharges me for the classroom and helps me give my best. In the halls of the academy I work to cultivate the interests of students, to teach them science, describe what we know about how the world operates, to note the mysteries that still need to be solved and to instill a sense of wonder regarding the natural environment. Science is much more than methodology, it is a way to understand our place in the cosmos and thus the human condition.

State parks and the halls of higher education are just two examples of spaces that mean a lot to me and many other Tennesseans. Whether it is the solace of the park or the curiosity of the classroom, these institutions reflect a human desire to explore, labor, leisure, wonder and create.

With this in mind, I am rather disturbed by a Request for Proposals (RFP) posted on August 11 to the Tennessee Department of General Services website. In a cost saving effort, the executive branch of Tennessee’s government is looking to outsource management of public institutions (including parks, campgrounds, research facilities, colleges, classrooms, prisons and National Guard armories) to the business sector. The RFP asked for private contractors to “provide a short narrative” regarding their expertise, qualifications, job timelines, service level agreements and geographic vendor presence.  I am equally disturbed that these conversations with private vendors have been going on for months with no public discussion of just how it would change the nature of these public goods — including how a new for-profit model might impact labor and admission to facilities.

Of course, the RFP should not be surprising. Tennessee Governor Bill Haslam is just following modern conservative doctrine. Of course the alternative, modern liberal doctrine, isn’t desirable either. As far as the conservative is concerned, cutting spending and selling public lands and institutions to the highest bidder is sound economics. The plan is applauded by the political right as a benefit to taxpayers with little or no reflection on the detriment done to public goods. On the other side of the aisle, Tennessee Democrats and the operating union UCW-CWA (which, full disclosure, I am a member of) are rallying on behalf of public workers. The idea is, the stronger the public sector, the better off is Tennessee labor. The Haslam plan is berated by the political left who have little or no understanding of the destructive nature of the state and its maintenance of public goods. What the state gives it can easily take away.

In viewing governance as such a black and white concept we lose the very concept of democracy. The false duality that says public goods can only be managed by either the state or private business fails to recognize that both approaches are authoritarian and overlook liberty as a praxis. We forget about the ability of “we” the public to run and manage our own affairs. We completely overlook the commons. Yet, common lands, institutions, and resources, coupled with our (freed) markets, build the public arena. It is in this arena that debate, consensus and adaptation, if empowered, can mold real governance. Conservatism and modern liberalism both deny the public their right to the commons. The commons are lost, as the state and allied business interests control the public arena. This is true everywhere, not just in Tennessee.

I write this article in defense of the overlooked common sector. The common sector is all but forgotten in our contemporary political discourse. Equally forgotten is common property. Common property is land or space in which all members of a given community hold equal rights over said territory — power is equally distributed. There is no coercive body delegating property management or use, as in state territory, nor is there exclusive ownership given to an anointed individual or privileged group, as with private property. Common property is liberated from enclosure movements — the cultural, social, economic and natural resources remain accessible to and managed by all stakeholders. This is not to say there is no governance of these resources. To the contrary, a highly ordered, decentralized, adaptive governance applies to common property. The people govern collectively.

Lucky for us, commons governance is slowly making a comeback. There are many examples of commons methodology. One poignant example is adaptive management of natural resources. Adaptive Collaborative Management (ACM) is an increasingly popular method of conflict resolution developed to resolve complex problems requiring collective action. ACM implores science, considers politics and fosters discussion between competing interests to build mutualistic approaches to conflict resolution.

Take the work of famed Nobel Laureate Elinor Ostrom. Ostrom, an economist and political scientist, challenged the idea that centralized authority, be it through government regulation or private property ownership, was necessary to successfully manage natural resources. In her landmark book, Governing the Commons, she demonstrated, under classical libertarian conditions (power equally distributed among individuals), that common property can be successfully managed by organized community members and user associations. Her life of research sheds light on commons governance and alternative social organization. She is not alone: “Ostromites,” as they are lovingly called, are everywhere. Even in government institutions, commons practitioners are decentralizing authority every bit they can.

For an earlier example, consider Peter Kropotkin (1842–1921). Kropotkin was a Russian prince, but is famous for his anarchism and discussions of evolutionary biology. It is Kropotkin who advanced the understanding of mutualistic relationships in the natural world. From his work, and others after him, we see the world as a place of competition, but also of incredible cooperation. Kropotkin’s work and those who’ve built on it has had a profound impact on how I view natural systems and our own capabilities as a species.

The common sector revisits the idea of (small d) democracy. Imagine a world where individuals, neighborhoods, a communities, cities, localities, etc. are interested and engaged in the affairs around them. The common sector presents the idea that there is no need to look to vertical power structures (such as the state or the business class) to make decisions, but that we can look horizontally to one another to make decisions. This is our right to the commons. It is the liberty of the individual to cultivate his neighborhood, community, city, region and so on. The commons are a market, freed of the restrictions of the state and capital, in action.

Such an ethic of governance allows competition of ideas between institutions, so that we may labor to maximize our potential and interests. Individuals discover their place in the community, and are empowered to labor free of capital, market or state restrictions.

As far as access to institutions goes, at the societal level, it is my belief that education, wild lands (via parks), health care and other services will be so sought after, that the models that govern them will change. I will use academia as an example.

Education is one of the greatest undertakings of our society. Learning is a life long pursuit and an endless adventure. Education provides the instruction and tools necessary for people to reach their maximum potential during this pursuit. Education is much more than teaching to a test or preparing individuals for the workforce — it is paramount to the cultivation of society. Education works to enhance the natural capacities of individuals by developing their innate need for intellectual growth. The old motto still rings true: “Learners are not empty vessels waiting to be filled, but instead respond in different ways to the stream of knowledge and its current.”

When benefits such as these transcend the community, the community may find the institutions that provide them so critical to the social order that they will be removed from the cash nexus. “Public” institutions would truly be public, a common regime. Private institutions, specialty institutions, under a new business model, free of the state, could compete in an open market, and this competition would drive down cost to the benefit of all individuals.

Commons governance is rebel governance. Liberty is no enemy of human labor. Individual and common interests will thrive alongside one another under liberty. Our enemy is the state, its allies and the calculated enclosure of our commons.

C4SS Feed 44 presents James C. Wilson‘s “Debt Forgiveness: End the Student Loan Industrial Complex” read by Mike Godzina and edited by Nick Ford.

The student debt crisis is not limited to students in for-profit schools, but state institutions as well. Federal Student loans have the problem of being one size fits all. In a market setting, lenders would be able to assess student’s future prospects before lending.

By making student loans so widely available the state contributes to making higher education a “must have” for even entry level jobs. Corporations are now able to abandon in-house education, shifting costs to tax payers and students. Degrees themselves have become commodities rather than the skills acquired. In such an environment, Universities are able to charge students for four years of irrelevant courses rather than simply granting the degree or certification for a specific trade or skill.

Furthermore, it allows corporations to justify shifting greater percentages of their pay to overly credentialed upper management. The same happens at universities themselves as administration costs and tuition sky-rocket, while cuts are made everywhere else.

Feed 44:

• http://www.c4ss.org/
• http://www.youtube.com/user/c4ssvideos
• https://itunes.apple.com/us/podcast/c4ss-media/id872405202?mt=2
• http://www.stitcher.com/podcast/smash-walls-radio/c4ss-media?refid=stpr
• https://twitter.com/C4SSmedia

Bitcoin tips welcome:

• 1N1pF6fLKAGg4nH7XuqYQbKYXNxCnHBWLB

As you may know, I’ve got some opinions about capitalism, and about the idea of “anarcho-capitalism.” I think that anarcho-capitalism is an incoherent goal, and in some ways destructive in practice. Not because I’ve got a problem with property, money, competition or market exchange, but because I think the conflation of these market forms with capitalistic concentrations of ownership and corporate business practices comes from a series of misconceptions, and some flat out economic blunders. Moreover, while there is a wide range of views among anarcho-capitalists, most tend to accept or outright promote some of the worst ills of capitalism as part of anarcho-capitalism. As a few examples: 1) anarcho-capitalism often encourages disproportionately business-centric rather than people-centric understandings of what economic freedom means and why it’s good; 2) it often constrains the imagination about what a free society might look like, to a really damaging extent; [1] 3) it encourages some wildly false and blinding beliefs about the origins of statist control; [2] 4) it systematically tends to recommend thinner rather than thicker conceptions of liberty, and so has been closely connected with a toxic cultural conservatism and defensiveness about many forms of status-quo social privilege; and 5) it has typically involved a dangerous and deliberate indifference to the effects that highly concentrated or class-stratified patterns of ownership, management, and access to social or economic capital, can have in damaging and deforming market dynamics.

It is my view that capitalism is not compatible with anarchism — that in fact, anarchy would undermine and destroy capitalist patterns of ownership and management wherever they existed. Attempts to defend capitalism more or less always end up falling back on serious errors or compromises of important anarchist principles.

But, all that said, I’m not at all interested in issuing dogmatic definitions to the effect that “anarcho-capitalists” cannot possibly count as genuine anarchists. I think that they are often wrong and  inconsistent. I also think that many anti-capitalist anarchists are wrong and inconsistent. Moreover, I think that there are anarcho-capitalists who have done good and important work which it’s worthwhile for other anarchists to study — both work about anarchist history [3] and work in contemporary anarchist theory. I think this work, even when it’s deeply mistaken, is worth taking the time to study with care and with a good-faith effort at charitable understanding. Unfortunately, some left-libertarians, in an effort to criticize what’s wrong with right-wing anti-statism and anarcho-capitalism, end up taking cheap shots at something that’s more reflective of their impressions of contemporary debates with pro-capitalist types than it is the actual history of anarcho-capitalism. For example, a while back C4SS posted a perfectly righteous little post on anarcho-capitalism criticizing it from a left-libertarian, anti-capitalist perspective. As well it should be criticized. Then, in comments, Tom Blanton added this:

I believe the term “anarcho-capitalist” was devised to appeal to conservatives (and their balanced checkbooks). While anarchism is scary and radical to conservatives, a guy in a suit and tie calling himself an anarcho-capitalist is not so threatening, especially when they support Republican presidential candidates. That sends a signal that maybe they don’t really want to abolish the state, but really just want some tax cuts and less regulations – just like Ronald Reagan!

And Dave Hummels followed it up by saying:

Ha! I think you have summed up Murray Rothbard’s appeal nicely. Well done, Tom.

If an-caps are looking for a new label, I have a suggestion: Bossertarian. I don’t know if it rolls of the tongue that smoothly, but it I think it’s a more honest portrayal of where their sympathy lies.

This is a common line; and it’s something of a self-congratulatory narrative among left-libertarians, when we’re trying to explain where the free-market anti-capitalist view comes from, and how it differs from “anarcho-capitalism.” But while I can’t speak to all the sources of Murray Rothbard’s appeal, I can say that, contrary to popular opinion, the term “anarcho-capitalism” was not — as far as anyone can tell — coined by Murray Rothbard.

Rothbard did, of course, use the term very frequently later on in his career. He was calling himself an “anarchist” and describing his views as a form of “anarchism” throughout the 1960s. And certainly those who first called themselves anarcho-capitalists were heavily influenced by Rothbard’s ideas. But the specific formulation of the term anarcho-capitalism does not, as far as I have been able to find, originate in Rothbard’s writing. The term does not seem to appear in print at all before 1969; Rothbard used it occasionally during 1969, [4] but did not use it extensively in his own writing until the early 1970s. The earliest uses of the term are sometimes attributed to the anarcho-Randian Jarret Wollstein’s 1969 pamphlet, Society Without Coercion: A New Concept of Social Organization, wherein Wollstein introduces the term “anarcho-capitalism” in section 2. 4, “Naming a Free Society.” But he introduces it there as a term that people in his circles had already been tossing around, and I don’t yet know of any good way to determine whether this section reflects content that was included in the February, 1969 talk that the pamphlet was based on, or whether the term was introduced when the talk was re-edited and expanded into a print pamphlet in August, 1969. [5]

In fact, the earliest documented, printed use of the word “anarcho-capitalism” that I can find [6] actually comes neither from Wollstein nor from Rothbard, but from Karl Hess’s manifesto “The Death of Politics,” which was published in Playboy in March, 1969. And the way it’s used there, if you see something calculated to appeal to business conservatives, I want to know what kind of conservatives you know. Here’s Karl; watch as he flies past, breaking the ideological sound barrier. Boldface mine.

This is not a time of radical, revolutionary politics. Not yet. Unrest, riot, dissent and chaos notwithstanding, today’s politics is reactionary. Both left and right are reactionary and authoritarian. That is to say: Both are political. They seek only to revise current methods of acquiring and wielding political power. Radical and revolutionary movements seek not to revise but to revoke. The target of revocation should be obvious. The target is politics itself.

Radicals and revolutionaries have had their sights trained on politics for some time. As governments fail around the world, as more millions become aware that government never has and never can humanely and effectively manage men’s affairs, government’s own inadequacy will emerge, at last, as the basis for a truly radical and revolutionary movement. In the meantime, the radical-revolutionary position is a lonely one. It is feared and hated, by both right and left — although both right and left must borrow from it to survive. The radical-revolutionary position is libertarianism, and its socioeconomic form is Laissez-faire capitalism.

Libertarianism is the view that each man is the absolute owner of his life, to use and dispose of as he sees fit: that all man’s social actions should be voluntary: and that respect for every other man’s similar and equal ownership of life and, by extension, the property and fruits of that life, is the ethical basis of a humane and open society. In this view, the only — repeat, only — function of law or government is to provide the sort of self-defense against violence that an individual, if he were powerful enough, would provide for himself.

If it were not for the fact that libertarianism freely concedes the right of men voluntarily to form communities or governments on the same ethical basis, libertarianism could be called anarchy.

Laissez-faire capitalism, or anarchocapitalism, is simply the economic form of the libertarian ethic. – Karl Hess, The Death of Politics, Playboy (March 1969)

Now there are all kinds of intriguing things going on here. All sorts of insights mixed in with many errors (I’m here to document anarcho-capitalism, not to praise it.). But whatever the case may be, it seems to me obvious that in Hess’s hands, the last possible thing on his mind in adopting “anarcho-capitalist” (rather than other common labels at the time — “libertarian,” “individualist,” “free markets,” etc.) was devising a label to appeal to conservatives or businessmen, or to avoid the whiff of frightening radicalism. If anything, Hess’s point in adopting the label seems exactly the reverse — to emphasize that his picture of economic and political freedom is something that ought to scare the hell out of conservatives:

The great flaw in conservatism is a deep fissure down which talk of freedom falls, to be dashed to death on the rocks of authoritarianism. Conservatives worry that the state has too much power over people. But it was conservatives who gave the state that power. It was conservatives, very similar to today’s conservatives, who ceded to the state the power to produce not simply order in the community but a certain kind of order.

It was European conservatives who, apparently fearful of the openness of the Industrial Revolution (why, anyone could get rich!), struck the first blows at capitalism by encouraging and accepting laws that made the disruptions of innovation and competition less frequent and eased the way for the comforts and collusions of cartelization.

Big business in America today and for some years has been openly at war with competition and, thus, at war with laissez-faire capitalism. Big business supports a form of state capitalism in which government and big business act as partners. Criticism of this statist bent of big business comes more often from the left than from the right these days, and this is another factor making it difficult to tell the players apart. John Kenneth Galbraith, for instance, has most recently taken big business to task for its anticompetitive mentality. The right, meantime, blissfully defends big business as though it had not, in fact, become just the sort of bureaucratic, authoritarian force that rightists reflexively attack when it is governmental.

The left’s attack on corporate capitalism is, when examined, an attack on economic forms possible only in collusion between authoritarian government and bureaucratized, nonentrepreneurial business. It is unfortunate that many New Leftists are so uncritical as to accept this premise as indicating that all forms of capitalism are bad, so that full state ownership is the only alternative. This thinking has its mirror image on the right.

It was American conservatives, for instance, who very early in the game gave up the fight against state franchising and regulation and, instead, embraced state regulation for their own special advantage. Conservatives today continue to revere the state as an instrument of chastisement even as they reject it as an instrument of beneficence. … For many conservatives, the bad dream that haunts their lives and their political position (which many sum up as “law and order” these days) is one of riot. To my knowledge, there is no limit that conservatives would place upon the power of the state to suppress riots.

Even in a laissez-faire society, of course, the right to self-defense would have to be assumed, and a place for self-defense on a community basis could easily be imagined. But community self-defense would always be exclusively defensive. Conservatives betray an easy willingness to believe that the state should also initiate certain offensive actions, in order to preclude trouble later on. “Getting tough” is the phrase most often used. It does not mean just getting tough on rioters. It means getting tough on entire ranges of attitudes: clipping long hair, rousting people from parks for carrying concealed guitars, stopping and questioning anyone who doesn’t look like a member of the Jaycees, drafting all the ne’er-do-wells to straighten them up, ridding our theaters and bookstores of “filth” and, always and above all, putting “those” people in their place. To the conservative, all too often, the alternatives are social conformity or unthinkable chaos.

Even if these were the only alternatives — which they obviously aren’t — there are many reasons for preferring chaos to conformity. Personally, I believe I would have a better chance of surviving — and certainly my values would have a better chance of surviving — with a Watts, Chicago, Detroit, or Washington in flames than with an entire nation snug in a garrison. – Karl Hess, The Death of Politics, Playboy (March 1969)

In spite of the in-your-face radicalism of the essay and the overt hostility to both conservatives and big business, Hess is actually much more tentative about the “anarcho” than he is about “capitalism;” but he makes clear the anti-politics that he envisions does, ultimately, mean the abolition of the state:

Conservatives and liberals alike hold in common the mystical notion that nations really mean something, probably something permanent. Both ascribe to lines drawn on maps — or in the dirt or in the air — the magical creation of communities of men that require sovereignty and sanction. The conservative feels this with exaltation when he beholds the Stars and Stripes. The liberal feels this with academic certitude when he concludes that Soviet boundaries must be “guaranteed” to prevent Soviet nervousness. Today, in the ultimate confusion, there are people who feel that the lines drawn by the Soviet Union, in blood, are better than the lines drawn, also in blood, by American foreign policy. Politicians just think this way.

The radical and revolutionary view of the future of nationhood is, logically, that it has no future, only a past — often an exciting one, and usually a historically useful one at some stage. But lines drawn on paper, on the ground or in the stratosphere are clearly insufficient to the future of mankind.

Again, it is technology that makes it feasible to contemplate a day in which the politics of nationhood will be as dead as the politics of power-wielding partisanship. First, there is enough information and wealth available to ensure the feeding of all people, without the slaughtering of some to get at the possessions of others. Second, there is no longer any way to protect anything or anybody behind a national boundary anyway.

Not even the Soviet Union, with what conservatives continue to fear as an “absolute” control over its people, has been able to stop, by drawing lines or executing thousands, the infusion of subversive ideas, manners, music, poems, dances, products, desires. If the world’s pre-eminent police state (either us or them, depending on your political point of view) has been unable to protect itself fully behind its boundaries, what faith can or should we, the people, retain in boundaries?

It is to be expected that both liberals and conservatives respond to the notion of the end of nationhood with very similar shouts of outrage or jerks of reaction. The conservative says it shall not be. There will always be a U.S. Customs Inspector and long may he wave. The liberal says that far from ending nationhood, he wants to expand it, make it world-wide, to create a proliferation of mini- and micronations in the name of ethnic and cultural preservation, and then to erect a great super-bureaucracy to supervise all the petty bureaucracies.

Like Linus, neither liberal nor conservative can bear the thought of giving up the blanket — of giving up government and going it alone as residents of a planet, rather than of a country. Advocates of isolationism (although some, admittedly, defend it only as a tactic) seem to fall into a paradox here. Isolationism not only depends upon nationhood, it rigidifies it. There is a subcategory of isolationism, however, that might avoid this by specifying that it favors only military isolationism, or the use of force only for self-defense. Even this, however, requires political definitions of national self-defense in these days of missiles, bases, bombers, and subversion. – Karl Hess, The Death of Politics. Playboy (March 1969)

And his particular interest in that essay — again, the closest thing that I have been able to find to a first coining and founding document for self-described “anarcho-capitalism” — is to insist that consistent libertarians and radicals should support voluntary socialism, black revolution, and the New Left student radicals.

I recall very vividly a comment on this subject by Roy Innis, the national director of the Congress of Racial Equality. He spoke of Mayor John Lindsay’s typically liberal zeal in giving money to black people, smothering them with it — or silencing them. Innis then said that the one thing Mayor Lindsay would not give the blacks was what they really wanted: political power. He meant that the black community in Harlem, for instance, rather than being gifted with tax money by the bushel, would prefer to be gifted with Harlem itself. It is a community. Why shouldn’t it govern itself, or at least live by itself, without having to be a barony of New York City Ward politics? However, I take exception to the notion of merely building in Harlem a political structure similar to but only separate from New York City’s. And I may be doing Mr. Innis, who is an exceptional man, an injustice by even suggesting that that is what he had in mind.

But beyond this one instance, there is implicit in the very exciting undercurrents of black power in this country an equally exciting possibility that it will develop into a rebellion against politics itself. It might insist upon a far less structured community, containing far more voluntary institutions within it. There is no question in my mind that, in the long run, this movement and similar ones will discover that laissez-faire is the way to create genuine communities of voluntarism. Laissez-faire is the only form of social/economic organization that could tolerate and even bless a kibbutz operating in the middle of Harlem, a hippie selling hashish down the street, and, a few blocks farther on, a firm of engineers out to do in Detroit with a low-cost nuclear vehicle.

The kibbutz would represent, in effect, a voluntary socialism — what other form could free men tolerate? The hash seller would represent institutionalized — but voluntary — daydreaming, and the engineers would represent unregulated creativity. All would represent laissez-faire capitalism in action and none would need a single bureaucrat to help, hinder, civilize or stimulate. And, in the process simply of variegated existence, the residents of this voluntary community, as long as others voluntarily entered into commerce with them, would solve the “urban” problem in the only way it ever can be solved; i.e., via the vanishment of politics that created the problem in the first place.

Student dissenters today seem to feel that somehow they have crashed through to new truths and new politics in their demands that universities and communities be made responsive to their students or inhabitants. But most of them are only playing with old politics. When the dissenters recognize this, and when their assault becomes one against political power and authority rather than a fight to gain such power, then this movement may release the bright potential latent in the intelligence of so many of its participants. Incidentally, to the extent that student activists the world over are actually fighting the existence of political power, rather than trying to grab some of it for themselves, they should not be criticized for failing to offer alternative programs; i.e., for not spelling out just what sort of political system will follow their revolution. What ought to follow their revolution is just what they’ve implicitly proposed: no political system at all.

The style of SDS so far seems most promising in this respect. It is itself loosely knit and internally anti-authoritarian as well as externally revolutionary. Liberty also looks for students who rather than caterwauling the establishment will abandon it, establish their own schools, make them effective and wage a concerned and concerted revolt against the political regulations and power that, today, give a franchise to schools — public and private — that badly need competition from new schools with new ideas.

Looking back, this same sort of thinking was true during the period of the sit-ins in the South. Since the enemy also was state laws requiring separate facilities, why wasn’t it also a proper tactic to defy such laws by building a desegregated eating place and holding it against hell and high water? This is a cause to which any libertarian could respond.

Similarly with the school situation. Find someone who will rebel against public-education laws and you will have a worthy rebel indeed. Find someone who just rants in favor of getting more liberals, or more conservatives, onto the school board, and you will have found a politically oriented, passé man — a plastic rebel.

Politics has always been the institutionalized and established way in which some men have exercised the power to live off the output of other men. But even in a world made docile to these demands, men do not need to live by devouring other men.

Politics does devour men. A laissez-faire world would liberate men. And it is in that sort of liberation that the most profound revolution of all may be just beginning to stir. It will not happen overnight, just as the lamps of rationalism were not quickly lighted and have not yet burned brightly. But it will happen — because it must happen. Man can survive in an inclement universe only through the use of his mind. His thumbs, his nails, his muscles and his mysticism will not be enough to keep him alive without it. – Karl Hess, The Death of Politics, Playboy (March 1969)

Does this mean that the anarcho-capitalists are right? That anarchism is or even could be capitalist, or that Hess was right to adopt the labels he did? Absolutely not. Does it mean that market anarchists ought to be comfortable with “capitalism” as an identity or that Hess’s understanding of it is particularly consistent? Like I said, I’ve got some views of my own on that, and I think that there are several interrelated mistakes in a view like this, some of which are related to what the term has come to mean in more recent debates.

But if we are going to try to read the anarcho-capitalists with understanding, then it is important to keep a clear eye on where this formulation and this tradition actually came from, at the time it emerged. The term was coined in in-your-face, hyper-radical documents from the most Left-oriented figures within the lazy-fairy scene; it came from people who had the most interest in putting forward the revolutionary edge of the things that they believed in, and the greatest hostility towards both conservatives and conventional big business. And with that in mind, it is important for left-libertarians to make our arguments against anarcho-capitalism on fair ground, to differentiate ourselves through serious, substantial argument not by means of under-sourced, and implicitly self-flattering, narratives about the motives and origins of our opponents.

(Of course, you may think that there is not much pay-off in spending much time with anarcho-capitalist writing, or in trying to read it with understanding. I’d hardly blame you if you came to that conclusion; everyone has limited time and there are many other things to read. But then if so, you shouldn’t make broad statements about what anarcho-capitalism is, what motivates it, or where it comes from.)

Notes: 

[1] In particular, the attempt to attach freed market ideals to something looking a lot like stereotypical commercialism and existing capitalist modes of ownership and production have tended to produce economic writing that completely ignores all the most important factors in economic life, strips freed markets of their most distinctively disruptive and anarchistic characteristics, and in fact strips them also of their most distinctively market-like operations.

[2] For example the common delusion that libertarian ideas will somehow naturally appeal to social and economic conservatives; or the insane belief that statist controls come mostly from populist agitation and mostly victimize the wealthy or socially well-connected — when in fact they have largely been the result of concerted and deliberate big-business campaigns to increase the scope and power of the state and to regulate industries in their own benefit — campaigns whose effects have inevitably benefited well-entrenched industrialists and financiers.

[3] For example, our understanding of the 19th century anti-capitalist individualist anarchists would be much thinner, and much poorer, if not for the work that has been put in by pro-capitalist writers like Carl Watner and Wendy McElroy, publishing in anarcho-capitalist forums like Journal of Libertarian Studies and Independent Review.

[4] See for example “Anarcho-Rightism“, October 1969, and “The Movement Grows“, June 1969.

[5] If I had to guess, my guess would be that it was introduced later, after the talk. Wollstein originally called his talk “Government Without Coercion,” and his comments about what he changed in making the booklet and why he changed it, seem to suggest that his revisions were largely in the direction of framing his view as more explicitly anarchistic, probably as a result of conversations with Roy Childs, who was already calling himself an “anarchist” by this time.

[6] And if you have a counter-example, hit me up with it in the comments — this is an ongoing research project.

C4SS Feed 44 presents Sheldon Richman‘s “What the Hell are we Doing in Yemen?” read by Joey Clark and edited by Nick Ford.

Iran today serves the same purpose the Soviet Union, or the International Communist Conspiracy, served from the end of World War II until 1989-91, when the Soviet empire collapsed. Iran is the all-purpose arch enemy on which virtually any evil can be blamed. So the war party and its Saudi and Israeli allies tell us every day that Iran is on the march, controlling capitals throughout the Middle East: Baghdad, Damascus, Beirut, and now Sana’a.

But this is absurd. Iran is not on the march. George W. Bush knowingly delivered Baghdad to Iran-friendly Iraqi Shiites in 2003. The Assad regime in Syria is a long-time Iranian ally that Obama and his first secretary of state, Hillary Clinton, declared open season on, emboldening al-Qaeda and its more-virulent mutation, ISIS. Iran’s friends in Lebanon, the political party Hezbollah, formed itself in response to Israel’s 1982 invasion and long occupation. None of these demonstrate an aggressive Iran. A better explanation is that those alliances help Iran cope with the American encirclement. (Recall: the CIA overthrew Iran’s democratic government in 1953 and was complicit in Iraq’s 1980s offensive war against Iran, in which Saddam Hussein used U.S.-facilitated chemical weapons. Since then, U.S. presidents and Israel’s government have attacked Iran in many ways: economic, cyber, proxy-terrorist, and covert.)

Feed 44:

• http://www.c4ss.org/
• http://www.youtube.com/user/c4ssvideos
• https://itunes.apple.com/us/podcast/c4ss-media/id872405202?mt=2
• http://www.stitcher.com/podcast/smash-walls-radio/c4ss-media?refid=stpr
• https://twitter.com/C4SSmedia

Bitcoin tips welcome:

• 1N1pF6fLKAGg4nH7XuqYQbKYXNxCnHBWLB

C4SS Feed 44 presents Kevin Carson‘s “Won’t Get Fooled Again” read by Tony Dreher and edited by Nick Ford.

In 2008, we heard a lot of stuff from Obama about the NSA’s warrantless wiretapping and Gitmo; and then in January 2009 Obama turned on a dime and enacted George Bush’s third term on such issues. Despite populist rhetoric about pulling out of NAFTA (which his team may have, a la Lieberman, reassured Canada was just rhetoric), Obama has doubled down on so-called “free trade agreements” like TPP during his administration.

But at least Obama in 2008 could do a plausible impression of someone who actually meant what he said. Hillary Clinton can’t for the life of her. Typically, three days after Clinton answers a question with her “I’m glad you asked me that” smile, news emerges proving it was a lie. Remember her story about landing under fire in Bosnia? And if you believe her vote to authorize the Iraq war was motivated by anything but concern for her future electability, say hello to the Easter Bunny for me.

Feed 44:

• http://www.c4ss.org/
• http://www.youtube.com/user/c4ssvideos
• https://itunes.apple.com/us/podcast/c4ss-media/id872405202?mt=2
• http://www.stitcher.com/podcast/smash-walls-radio/c4ss-media?refid=stpr
• https://twitter.com/C4SSmedia

Bitcoin tips welcome:

• 1N1pF6fLKAGg4nH7XuqYQbKYXNxCnHBWLB

Well, kind of.

Obviously Benjamin Tucker had no direct opinions about “anarcho-capitalism,” because the term was not even coined until many years after his death, and several decades after his retirement from radical politics. But Tucker did have quite a bit to say about the relationships among anarchism, socialism, and capitalism, and it may be worth having a look at it.

The question’s interesting partly as a matter of historical curiosity, but partly also because it may help shed some light on an old argument which has mostly produced heat. There are certain groups of anti-capitalist anarchists — most of them communist or collectivist anarchists — who tend to start spitting fire when pro-capitalist anti-statists like Murray Rothbard or David Friedman describe themselves as “anarcho-capitalists,” or identify their position as a form of “anarchism” simpliciter, or identify anarcho-capitalism as a close relation of the free-market individualist anarchism of Benjamin Tucker, Lysander Spooner, Victor Yarros, et al. The locus classicus of the fire-spitting on the web is of course Section F and Section G of the “social anarchist” Anarchist FAQ; if that’s not where you’re encountering the debate, you’re almost certain to hear it get cited repeatedly anyway. At this point a heated debate soon follows over whether anarcho-capitalism is a genuine form of anarchism, or an unrelated form of right-wing anti-statism being fraudulently passed off as anarchism. The debate often focuses in on the notion of an anarchist tradition, and the argument turns to the question of (1) whether a pro-capitalist position is or is not incompatible with essential and continuous elements of that tradition; and (2) whether anarcho-capitalism is a legitimate part of that tradition or an independent and basically alien ideology that has just nicked some terminology and a couple slogans from traditional anarchism. And this is where the individualist anarchists get dragged into the fight.

Social anarchists and anarcho-capitalists spend quite a bit of time fighting with each other over who gets to claim the individualist anarchists of the late 19th and early 20th century. The anarcho-capitalists point out the Liberty circle’s relentless emphasis on free markets, free competition, individually-held property, and opposition to communism. The social anarchists point out Tucker et al.’s self-identification as “socialists,” their relentless explicit attacks on the capitalist and landlord classes, their identification with nonviolent forms of labor militancy, and their analysis of interest on loans, rent on land, profits from the hiring out of capital, etc. as the creatures of state-fabricated privileges to the propertied classes. I don’t want to get too deep into these exegetical arguments right now; I’ve already discussed some of the semantic difficulties involved elsewhere (1, 2, 3, etc.), and Roderick has a couple of excellent posts on the topic at Austro-Athenian Empire (2007-04-01): Against Anarchist Apartheid and more recently Austro-Athenian Empire (2007-11-11): Voltairine de Cleyre, Anarcho-capitalist? For now, suffice it to say that both sides of the argument are substantially right, and substantially wrong; many anarcho-capitalists have been maddeningly selective, and substantially distorted the individualists in order to obscure or neglect the socialistic bite of the individualist understanding of class, privilege, and exploitation. But the social anarchists have also cut a lot of corners in explaining the individualists’ positions, which mostly serve to make Tucker, Spooner, Yarros, de Cleyre, etc. seem much more monolithic than they actually were, and to make them seem significantly less propertarian, and more friendly towards collectivistic and communistic socialism, than they actually were. Meanwhile the social anarchists’ reconstruction of anarcho-capitalist theory is so ferociously uncharitable, and so far out of touch with the versions of anarcho-capitalism espoused by central figures such as Karl Hess and Murray Rothbard in the period of Left and Right and Libertarian Forum, that frankly they ought to be embarrassed to show it in public.

In any case, since I am myself an individualist anarchist, and not an anarcho-capitalist or a social anarchist, I don’t have much of a dog in the fight, except insofar as it gets a bit tiresome watching the two bicker over the individualist tendency within the movement as if they were arguing over the contents of their dead grandmother’s will. We are still about and hardly need a bunch of anarcho-capitalists and social anarchists to do the talking for us. But setting aside most of the exegetical argument, there are a couple of claims that social anarchists routinely make about “the anarchist tradition” that need some closer scrutiny.

First, social anarchists claim that a no-government position is necessary but not sufficient for genuine anarchism; second, they claim that traditionally anarchists have understood anarchism to demand not only the abolition of the State as such, but also opposition to capitalism, in some fairly robust sense, and that the anti-capitalist position is as essential to all genuine traditional anarchism as the anti-statist position. Hence the amount of ink spilled in order to demonstrate that Benjamin Tucker did, indeed, call himself an anarchistic socialist, that the individualists did indeed believe that wage workers were systemically exploited by employers, that they did support squatters over absentee landlords, and that the economic predominance of capitalists, landlords, and money barons in the marketplace was a creature of government privilege, which would collapse on a genuinely free market. (It’s actually not at all clear to me how this position is supposed to be radically different from Karl Hess’s position, or Rothbard’s position in Confiscation and the Homestead Principle. But whatever.) It is certainly true that Tucker and his comrades considered themselves socialists as well as individualists, and that they considered their socialism very important to their position. But did these traditional anarchists actually agree with contemporary social anarchists’ interpretive claims about the meaning of the term anarchism, or the essential features of the anarchist tradition?

Roderick recently put up a good post about the attitude of Voltairine de Cleyre, during her earlier individualist anarchist phase. (De Cleyre later changed her position in a way that she understood as a rejection of individualist anarchism, and which social anarchists often claim was a conversion to anarcho-communism. But in fact her later position was more of an economic panarchy in which individualist and communist communities could coexist.) Now, here’s Tucker, in an column that he first penned for Liberty in 1890, and then reprinted in Instead of a Book. Tucker was responding to an explicit attempt to give definitions of socialism and anarchism in Hugh Pentecost’s radical paper, the Twentieth Century. The boldface is mine.

Take now another Twentieth Century definition, — that of Anarchism. I have not the number of the paper in which it was given, and cannot quote it exactly. But it certainly made belief in co-operation an essential of Anarchism. This is as erroneous as the definition of Socialism. Co-operation is no more an essential of Anarchism than force is of Socialism. The fact that the majority of Anarchists believe in co-operation is not what makes them Anarchists, just as the fact that the majority of Socialists believe in force is not what makes them Socialists. Socialism is neither for nor against liberty; Anarchism is for liberty, and neither for nor against anything else. Anarchy is the mother of co-operation, — yes, just as liberty is the mother of order; but, as a matter of definition, liberty is not order nor is Anarchism co-operation.

I define Anarchism as the belief in the greatest amount of liberty compatible with equality of liberty; or, in other words, as the belief in every liberty except the liberty to invade.

It will be observed that, according to the Twentieth Century definitions, Socialism excludes Anarchists, while, according to Liberty’s definitions, a Socialist may or may not be an Anarchist, and an Anarchist may or may not be a Socialist. Relaxing scientific exactness, it may be said, briefly and broadly, that Socialism is a battle with usury and that Anarchism is a battle with authority. The two armies — Socialism and Anarchism — are neither coextensive nor exclusive; but they overlap. The right wing of one is the left wing of the other. The virtue and superiority of the Anarchistic Socialist — or Socialistic Anarchist, as he may prefer to call himself — lies in the fact that he fights in the wing that is common to both. Of course there is a sense in which every Anarchist may be said to be a Socialist virtually, inasmuch as usury rests on authority, and to destroy the latter is to destroy the former. But it scarcely seems proper to give the name Socialist to one who is such unconsciously, neither desiring, intending, nor knowing it. — Benjamin Tucker, Armies that Overlap, Instead of a Book. ¶¶ 10–12.

Tucker was famously strict in applying the term “anarchist” — he argued that professedly anti-statist communists such as Johann Most or the Haymarket martyrs were not in fact anarchists, but only governmentalists of a different stripe who had illegitimately appropriated the term from the proponents of individual property and free markets. So it’s interesting to note that here, while Tucker places himself in the socialist camp, he is explicitly willing to grant the name “anarchist” to those who oppose the state even if they reject socialism and accept or support capitalistic “usury;” it would seem that Tucker would have accepted anarcho-capitalism, but not many forms of social anarchism, as legitimately anarchistic. If it were the 19th century individualists who were separating the sheep from the goats, instead of having a bunch of latter-day social anarchists swoop in putatively to do it on their behalf and save them from the evil schemes of the an-caps, then you’d get a very different line-up for the anarchist tradition; of the two Murrays, Rothbard would probably be in, and Bookchin would probably be out.

Now, that’s an interesting result. Not because of the fact that Tucker must be right about this; just because Tucker used the word one way doesn’t mean that everyone did then, or that everyone has to now. After all, I certainly don’t have any problem with referring to Most or Albert Parsons or Kropotkin as an anarchist, even though I think that there are key points on which Tucker is right and they are wrong. But I do think that it’s important, if you’re going to go appeal to the anarchist tradition, to make sure that the claims you’re making about continuity and essential features are supported by how those traditional anarchists saw themselves, and not just a projection of your own priorities and your own ideas about what’s essential onto your predecessors. Given what Tucker, for one, actually said about what he understood anarchism to mean, and who he would or would not recognize as a fellow anarchist, I don’t think that the the social anarchist polemics have done a very good job of that, as far as the Liberty individualists are concerned.

It’s hardly news that Charles and David Koch are longtime supporters of the American Legislative Exchange Council (ALEC). For example, Institute for Humane Studies “Koch fellows” are heavily represented in staff jobs at ALEC, and frequently go on to head the task forces that draft model legislation. The Kochs stated some time ago their preference for Scott Walker among the long list of 2016 GOP hopefuls. And now, to complete the triangle, Talking Points Memo recently shone a spotlight on Walker’s involvement with ALEC (Brian Murphy, “Meet ALEC’s (Hoped For) Man in Washington: Scott Walker,” August 10). Walker has frequently used emergency rules to railroad through ALEC legislation without debate.

Although all three points of this triangle are celebrated in the mainstream libertarian press with heavy use of the term “free market,” they’re anything but. It’s hardly surprising that ALEC’s association with “free markets” is just a brand image for public consumption, given private sector members’ (aka “corporations”) role in setting its agenda; private sector members of ALEC’s task forces have absolute veto power over all model legislation drafted by those bodies, guaranteeing that any state legislative proposals generated by ALEC will actively promote the economic interests of the corporate donors it represents.

The Arkansas Times (Max Brantley, “ALEC, Scott Walker and cozy lobbying opportunities,” Aug. 11) gives a particularly foul example of the sort of human garbage that show up to hobnob at ALEC. Among the official hosts of an ALEC gathering at a San Diego steakhouse were four Arkansas lobbyists. They included Gilbert Baker, whose claim to fame is bribing a state judge to reduce a negligence judgement against nursing home magnate Michael Morton by more than $4 million.

Equally suggestive of the phoniness of Koch “free market” pretensions is their support for fossil fuel pipelines like Keystone (which is possible only through use of eminent domain and profitable only through liability caps for spills) and fracking (a front-loaded ponzi scheme industry which depends heavily on regulatory preemption of liability for earthquakes and pollution, and ALEC-drafted “trade secret” legislation that prohibits disclosing the chemicals used in fracking).

At the federal level ALEC has vigorously supported “free trade agreements” (falsely so-called) like NAFTA and TPP, which have nothing to do with free trade and everything to do with the draconian “intellectual property” laws central to the protectionist business model of global corporations.

The list of other fake “free market” (but actually corporatist) state policies supported by the Kochs, ALEC and/or Walker is a long one. So-called “right-to-work” laws, for example, are actually a regulatory assault on the freedom of employers and unions to negotiate union shop contracts, and a mandate that unions represent non-dues-paying scabs. “Ag-gag” legislation treats undercover reporting on factory farms as an act of economic terrorism. Other legislation forces consumers to pay utilities to accept surplus electricity fed back into the grid from solar generators on the alleged grounds that they’re “free riders” on utility infrastructure, even though they probably actually save electric companies money by feeding back energy at times of peak demand.

Especially offensive is so-called “tort reform” which eviscerates the civil liability which would be the main recourse in a free market for punishing damage to consumers, workers and the public by corporate malefactors. Besides liability caps, “loser pays” provisions amount to a guarantee nobody of ordinary means will risk suing deep pocket corporations even in the worst cases of wrongdoing.

Other questionable policies celebrated by the usual right-libertarian suspects include laws which weaken the job security and bargaining power of public school teachers (the very un-Hayekian practice of empowering administrative bureaucrats at the expense of the people actually teaching kids) and replacing defined benefit pensions with defined contribution ones (what some people would call violating contracts). In addition Walker is a poster boy for “disaster capitalism.” He has a history — much like Paul Bremer’s Coalition Provisional Authority in Iraq — of promoting corporate looting of public sector assets. So, two rules to keep in mind next time you hear the Koch brothers, ALEC or Scott Walker associated with “free markets”: 1) they’re lying; and 2) follow the money.

C4SS Feed 44 presents Kevin Carson‘s “‘Intellectual Property’ Kills’” read by Mike Godzina and edited by Nick Ford.

The key agenda at the center of all the so-called “free trade agreements” is the imposition, at the behest of the giant corporations that depend on “intellectual property” monopolies for their profits, of a form of protectionism far more coercive and harmful than tariffs ever dreamed of being. “Intellectual property” serves the same function that tariffs did a century ago; only now that corporations are global rather than national, the protectionist barriers are erected at corporate boundaries rather than national ones. But in either case, the protectionism involves a monopoly on the right to sell certain goods within certain market areas.

Drug patents have killed millions, and if the corporate pigs at the TPP trough get their way will kill millions more. And the enclosure of the knowledge commons erects toll-gates to impede sharing and building on knowledge. In so doing destroys the basic peer-to-peer ethos of science, which is the basis of the so-called “shoulders of giants” effect.

We need to continue fighting Aaron Swartz’s battle for information freedom, to hack academic journal paywalls and make the liberated articles freely available at file-sharing sites. And we need to seize on the opportunity offered by 3D printed drugs and open-source pharmacology to produce cheap, pirated knockoffs of patented drugs through so many different small, distributed outlets that the drug companies and their state can’t possibly suppress them.

Feed 44:

• http://www.c4ss.org/
• http://www.youtube.com/user/c4ssvideos
• https://itunes.apple.com/us/podcast/c4ss-media/id872405202?mt=2
• http://www.stitcher.com/podcast/smash-walls-radio/c4ss-media?refid=stpr
• https://twitter.com/C4SSmedia

Bitcoin tips welcome:

• 1N1pF6fLKAGg4nH7XuqYQbKYXNxCnHBWLB

C4SS Feed 44 presents Nick Ford‘s “The NSA is Phoning it in Again” read by Joey Clark and edited by Nick Ford.

The fact that Alexander needed convincing that the program was a failure is proof enough that it was mostly talk. If you need to convince your boss of something that is widely known otherwise and that he has little incentive to admit, what do you think will happen?

This dynamic within a hierarchy is not new and related to a phenomenon Kevin Carson calls “magical thinking”.

The workers at the bottom of the NSA, complicit as they may be for these awful affronts to our dignity, are much more front and center with what the program actually does. Thus they have much more knowledge about what is going on and what might be worth changing. But they have little incentive to tell the people up top that because they could get fired or punished.

Feed 44:

• http://www.c4ss.org/
• http://www.youtube.com/user/c4ssvideos
• https://itunes.apple.com/us/podcast/c4ss-media/id872405202?mt=2
• http://www.stitcher.com/podcast/smash-walls-radio/c4ss-media?refid=stpr
• https://twitter.com/C4SSmedia

Bitcoin tips welcome:

• 1N1pF6fLKAGg4nH7XuqYQbKYXNxCnHBWLB

Ira Stoll discusses how Trump and Sanders are similar.

A. Barton Hinkle discusses libertarian approaches to dealing with income inequality.

Tom Engelhardt discusses the U.S. antiwar movement.

Richard Ebeling discusses the views of John Stuart Mill.

Justin Raimondo discusses Hilary Clinton, Chelsea Manning, and double standards.

Jacob G. Hornberger discusses Jeb Bush’s confused mindset on Iraq.

Jacob G. Hornberger discusses the bombing of innocents.

Glenn Greenwald discusses Obama’s failed bid to close Gitmo.

Laurence M. Vance discusses 80 years of social security.

Lucy Steigerwald discusses the dropping of the atomic bombs.

Conor Friedersdorf discusses the ongoing persecution of Chelsea Manning.

Gareth Porter discusses post-Vienna U.S. foreign policy.

Sheldon Richman discusses the U.S.-Israel conflict.

Andrew Levine discusses how AIPAC is headed for defeat.

Michael Brendan Dougherty discusses how Dubya and Marco Rubio’s foreign policies are similar.

Robert Fantina discusses Israel, the U.S. Congress, and the Iran nuclear agreement.

Paul Mueller discusses the ethics of Adam Smith.

Uri Avnery discusses Jewish terrorists and administrative detention.

Stephen Lendman discusses the torture of Chelsea Manning in prison.

Chris Anders discusses why continuing indefinite detention isn’t closing Gitmo.

Robert Parry discusses the neoconservative desire to be trusted.

Justin Raimondo discusses the potential for liberalization in communist Cuba.

Ramzy Baroud discusses the rise and fall of revolutionary discourse in the Arab world.
Eric Margolis discusses how Republicans can’t face the truth about Iraq.

Norman Solomon discusses the value of Wikileaks.

Peter Koening discusses the Iran Gambit two.

Steve Chapman discusses Christie, Rand Paul, and the NSA.

Richard M. Ebeling discusses a classical liberal vision for a freer and more prosperous America.

Bruce Fein discusses the myth of presidential wisdom in foreign affairs.

Ivan Eland discusses the scorecard on U.S. interventionism.

Dan Sanchez discusses the cycle of the state.

In a recent email, a professor of sociology expressed some skepticism about what she regarded as over-enthusiastic treatment of the possibilities for new education models in a stateless society. Among other things, she questioned the apparent claim that new media, online courses and free lectures would “save the education system” or provide access to education.

My response to these points is that 1) we should first address the prior question of the nature of the system we’re guaranteeing access to, and 2) the current education system needs to be destroyed, not saved.

The critic seems to be treating the need for “education” as relatively static, and asking only how the models for delivering it would be different in a stateless society. The real question is, whose needs are being served right now? One thing is for sure — it’s definitely not the students’. The customers, or clients, of today’s educational system are corporate employers. Students are simply the raw material. The specifications for what “needs” to be taught today, and the whole institutional system for delivering it, were set by a century-old interlocking constellation of institutions centered on large mass-production industry.

Discussions of “guaranteeing access” to education, healthcare, jobs and so forth on the mainstream Left seem to follow a common pattern. First, the good in question is a necessary input into the existing corporate system. Second, consumption of the good by ordinary people is transformed into one of Ivan Illich’s “radical monopolies,” participation in which becomes becomes a fundamental requirement for survival. And third, it’s institutionalized under the control of a professionalized administrative caste which maintains a monopoly on providing the good.

The mainstream Left tends to focus almost entirely on how access to that given model can be “guaranteed,” with little or no discussion of changing the internal culture of the institutional system that delivers it, or changing the extent to which it is a radical monopoly that people are required to participate in to have comfortable subsistence.

It reminds me of what Antonio Negri and Michael Hardt have said about the social democratic agenda which, far from taking advantage of the liberatory potential of new technology to abolish work or enable a Kropotkinian vision of self-managed cooperative shops in agro-industrial villages, aims “to reintegrate the working class within capital.” “It would mean, on the one hand, re-creating the mechanisms by which capital can engage, manage, and organize productive forces and, on the other, resurrecting the welfare structures and social mechanisms necessary for capital to guarantee the social reproduction of the working class.”

Our anarchistic vision involves not simply abolishing the educational system as we know it, but also abolishing all the institutional customers for that system’s product. One thing I constantly emphasize is that, in an economy of self-managed cooperative production, self-employment, and direct production for use in the informal/household sector, the kind of education being demanded for employment wouldn’t be driven mainly by the needs of corporate Human Resources departments. They’d be set by the actual recipients of education, which in turn would be set on an ad hoc basis by individual workers negotiating as equals with small, self-organized production groups.

In the same email, the correspondent raises the question of what administrative and other overhead costs have to do with “abolishing the state and thus public education, and outsourcing it to new media.”

The answer is that the rise of higher education as a high-overhead, capital-intensive institution directly mirrors the rise of mass-production industry on the same model. And in both cases, high overhead was an entry barrier that empowered giant, hierarchical institutions that used human beings as raw material (human resources). Eliminating the overhead also eliminates the entry barriers to people directly self-organizing the same functions outside the control of the large institutions.

C4SS Feed 44 presents “Platonic Productivity” from the book Markets Not Capitalism, written by Roderick Long, read by Stephanie Murphy and edited by Nick Ford.

“Nothing I’ve said shows that men and women are equally productive; it’s only meant to show that, given prevailing cultural norms and power relations, we might well expect to see a gap between men’s and women’s earnings even if they were equally productive (which is at least reason for skepticism about claims that they are not equally productive).

I would also add that even if there are persistent problems — non-governmental but nonetheless harmful power relations and the like — that market processes do not eliminate automatically, it does not follow that there is nothing to be done about these problems short of a resort to governmental force. That’s one reason I’m more sympathetic to the labour movement and the feminist movement than many libertarians nowadays tend to be. In the 19th century, libertarians saw political oppression as one component in an interlocking system of political, economic, and cultural factors; they made neither the mistake of thinking that political power was the only problem nor the mistake of thinking that political power could be safely and effectively used to combat the other problems.”

Feed 44:

http://www.c4ss.org/
http://www.youtube.com/user/c4ssvideos
https://itunes.apple.com/us/podcast/c4ss-media/id872405202?mt=2
http://www.stitcher.com/podcast/smash-walls-radio/c4ss-media?refid=stpr
https://twitter.com/C4SSmedia
Bitcoin tips welcome:

1N1pF6fLKAGg4nH7XuqYQbKYXNxCnHBWLB

Donald Trump may think the media stenographers are out to get him, but if they were really doing their job, his head would be spinning. He doesn’t know how good he has it. Or maybe he does.

One need only think about the questions Trump is not asked to see what I mean. Take Trump’s position on trade. He’s given a forum to spout the hoariest fallacies without even a raised eyebrow from Anderson Cooper, Chris Cuomo, et al. Maybe they don’t know any better, or maybe they think that challenging Trump’s crackpot economics is not their department. Either way, they do their audience a disservice.

How great would it be if some reporter asked, “Mr. Trump, didn’t Adam Smith refute all this in 1776?”

Or: “Mr. Trump, show me where Henry George erred when he said, ‘What protection teaches us is to do to ourselves in time of peace is what enemies seek to do to us in time of war'”?

If that is too highbrow, they might ask: “Mr. Trump, if your import taxes force Americans to pay more for cars and other foreign-made products, won’t they have less money to spend on other things or to invest? How would that help make America great?”

Trump says American presidents have been played for chumps by foreign countries in trade (and all other) matters. His proof? Americans send the Japanese corn and wheat, and the Japanese send Americans cars in return. To him this is — on its face — an outrage. Strangely, he adds that the Japanese don’t want the corn or wheat. No one bothers to ask him why, then, they accept those commodities. I thought Americans were the ones being taken advantage of.

Before we get to the core of the matter, let’s point out that Trump’s story is rather oversimplified. No American pays for a foreign car with corn or wheat. Americans use dollars. Car dealers also use dollars. So do wholesalers, etc. True, at some point, Japanese handlers of cars are paid in yen, or if paid in dollars, they convert them to yen (if they do not invest the dollars in American stocks, bonds, or real estate). Eventually, someone in Japan buys American wheat or corn (or something else), but those commodities are not bartered for automobiles. At any rate, what would be wrong if they were? In fact, what would be wrong if the Japanese refused to accept the commodities and sent the cars to us for free? Would greatness lie in rejecting free cars? Would free cars free up resources and labor for things we can’t afford today because we have to pay for cars? Trump needs to read Bastiat.

Let’s ignore, at least for now, that “the vast majority of the cars and trucks made in North America are still produced in the U.S. for domestic consumption and export to other countries” and that many foreign cars have American parts. Let’s also ignore the rather key fact that foreign automakers long ago built factories in the United States. From the way Trump talks, you’d think it was 1980, but you don’t hear reporters mentioning that to him.

Those are relevant facts, but they are not critical to exposing Trump’s protectionist snake oil. So let’s assume that Americans import all their cars from Mexico, Japan, Germany, Sweden, and South Korea.

So what?

As long as the government does not subsidize or penalize consumer choice either directly or indirectly, we have no reason for concern about Americans’ auto-buying. (If the government were distorting the market — which of course it does — the proper response would be to eliminate the interventions, not to micromanage us, as Trump would do.)

The purpose of production is not job-creation; it’s consumption. If Americans find foreign-made cars a better value than American cars, so be it. To the extent they save money, they have more discretionary income with which to buy other things or to save and invest. For those who (needlessly) worry about jobs, this new ability to buy and save ought to be comforting. If Americans’ direct auto-making talents aren’t valued in the marketplace, Americans will make other things that consumers (here and abroad) will want. That’s the law of comparative advantage in action. (Again, this assumes no government distortions, such as those created by subsidies, taxes, occupational licensing, zoning, central banking, intellectual property, and other special-interest political mischief.)

Under these circumstances and contrary to Trump, it would be wrong to say, “Americans don’t make cars.” Of course they do. What does it mean to “make cars”? It surely does not mean to produce cars out of thin air, like magic. No one does that, not even Detroit in its heyday. Rather, it means to use labor and the forces of nature to transform raw and semi-finished materials into cars, converting a pile of matter from a less-useful form to a more-useful form from the consumers’ perspective.

In economics we have the fable of the mysterious factory that turned wheat into cars. Farmers would deliver the wheat to the door on the left, and a few days later cars would roll out from the door on the right. How could this be? It turned out that the factory was located at a harbor. Foreign ships docked at the factory, where they unloaded cars and loaded wheat. Voila! Cars from wheat. This is not a verbal trick. The process of production consists in a variety activities, and trade is one of them.

So an American who grows wheat and trades it to an automaker for a car (as if it happened that way) has indeed produced a car — indirectly to be sure, but he produced it nonetheless. From the consumer’s perspective, it doesn’t matter if the car seller made the car or acquired it through trade, as long as he sees a net benefit in the transaction.

But this is old news. It was spelled centuries ago by David Hume, Adam Smith, David Ricardo, Frederic Bastiat, John Stuart Mill, and others. No doubt the late Spanish Scholastics had figured it out before them. Most economists today accept it, including Paul Krugman. I guess Trump never got the memo.

We don’t need a deal-maker in the White House. We need the freedom to trade with anyone we please, anywhere in the world, on any terms we find agreeable. Government should butt out. Hear that, Mr. Trump?

Trump traffics in the stalest of stale trade fallacies, just as he traffics in the stalest of stale immigration fallacies. It’s what demagogues do. When will a reporter call him on it?

1. “Rejoinder” to Murray Rothbard

This is not, properly speaking, a rejoinder — obviously, since Rothbard’s article predates my book. But since it was chosen to set the tone for this symposium issue, and includes some comments on individualist anarchism in general, I’ll make a few remarks anyway.

On the land issue, I reserve comment, since that is also the focus of Roderick Long’s review. I merely observe that characterizing the Ingalls-Tucker doctrine as a limit on the landlord’s right to dispose of his “justly-acquired private property” begs the question of just how property is justly acquired.

On money and banking issues, Rothbard made the mistake of interpreting the Greene-Tucker system of mutual banking as an attempt at inflationary expansion of the money supply. Although the Greene-Tucker doctrine is often casually lumped together (in a broader category of “money cranks”) with social crediters, bimetallists, etc., it is actually quite different. Greene and Tucker did not propose inflating the money supply, but rather eliminating the monopoly price of credit made possible by the state’s entry barriers: licensing of banks, and large capitalization requirements for institutions engaged in providing only secured loans. Most libertarians are familiar with such criticisms of professional licensing as a way of ensuring monopoly income for the providers of medical, legal and other services. Licensing and capitalization requirements, likewise, enable providers of credit to charge a monopoly price for their services.

In fact, Rothbard himself made a similar analysis of the life insurance industry, in which state reserve requirements served as market entry barriers and thus inflated the cost of insurance far above the levels necessary for purely actuarial requirements (Rothbard 1977, p. 59).

And Böhm-Bawerk’s originary rate of interest was by no means a complete answer to Greene and Tucker. Aside from the monopoly premium made possible by the state’s banking laws, over and above the originary rate of interest, Böhm-Bawerk himself admitted that time preference might vary in steepness with one’s economic security and independence. Since, as the individualist anarchists argued, the state’s policies render capital artificially inaccessible to labor and increase labor’s dependence on the owners of capital, the time preference of laborers is artificially steep.

2. Rejoinder to Bob Murphy

My favorite part of Murphy’s review is his repeated reminder, at the outset, that “Carson is not a crank.” I may use that as a blurb for the next printing of my book. Recently science fiction writer Ken MacLeod, who had bought a copy of my book not long before, mentioned in his blog that a new collection of articles from Reason was the only libertarian paperback on his shelves whose cover didn’t “holler of crank.” So Murphy’s reassurance is doubly welcome.

The central area of disagreement between us concerns the importance of the “exceptions” to the cost theory of value. We have, it seems to me, a largely semantic disagreement on whether they are “exceptions” or simply secondary deviations from a primary law; and the significance that attaches to them, whether “exceptions” or “deviations,” is mainly a matter of subjective emphasis. Unlike Murphy, I prefer to regard the “exceptions” as second-order scarcity deviations. The validity of the central insight of classical political economy, that price is always tending toward a natural value determined by cost, with secondary fluctuations caused by scarcity rent, is unimpaired. And Marshall’s analogy of ripples on a pond, or of a swinging weight, is still admirably suited to describing real-world phenomena. The cost factor and scarcity rents are of entirely different orders of significance, being (respectively) a fundamental underlying tendency and a secondary disruption of that tendency.

Murphy writes:

a cost theory of (exchange) value entirely neglects the role of subjective valuations in the formation of market prices. Human actors are forward looking, and hence past expenditures and effort are irrelevant to the present determination of the relative merits of two different commodities. Even if all memory of previous expenditures were suddenly lost, market prices would still form.

Entirely neglects!?? I’m flabbergasted. I specifically addressed the issue of sunk costs in chapter one, along with the operation of the law of value through forward-looking behavior. Even Friedrich Engels acknowledged (in his Preface to Marx’s critique of Proudhon, The Poverty of Philosophy) that the market price of already-produced goods informed the producer, ex post facto, of the amount of socially necessary labor embodied in it, and thus influenced his prospective decision of how much to produce in the future.

In present-day capitalist society each individual capitalist produces off his own bat what, how and as much as he likes. The social demand, however, remains an unknown magnitude to him, both in regard to quality, the kind of objects required, and in regard to quantity. … Nevertheless, demand is finally satisfied in way or another, good or bad, and, taken as a whole, production is ultimately geared towards the objects required. How is this evening out of the contradiction effected? By competition. And how does the competition bring about this solution? Simply by depreciating below their labour value those commodities which by their kind or amount are useless for immediate social requirements, and by making the producers feel … that they have produced either absolutely useless articles or ostensibly useful articles in unusable, superfluous quantity.

[C]ontinual deviations of the prices of commodities from their values are the necessary condition in and through which the value of the commodities as such can come into existence. Only through the fluctuations of competition, and consequently of commodity prices, does the law of value of commodity production assert itself and the determination of the value of the commodity by the socially necessary labour time become a reality. (Marx and Engels 1884, pp. 286–87)

It is precisely through such subjective evaluations, in response to market price signals, that price moves toward cost. Of course market prices would form in Murphy’s collective amnesia scenario; but unless the acquisition of new knowledge from experience were suppressed, the prices of reproducible goods would again start gravitating toward production cost, as producers responded to ongoing price signals.

Murphy writes that the cost theory applies only to the prices of reproducible goods, and can only explain the “‘natural’ (long-run) price of a good.” The classical political economists admitted as much. Ricardo’s cost theory, which incorporates scarcity, can explain “day-to-day fluctuations in market price.” Cost theories assert only that cost is the natural equilibrium value that price always tends toward, despite constant disruptions by the forces of supply and demand. And those disruptions, indeed, are the mechanism by which price moves toward cost.

He also faults me for charging Böhm-Bawerk with a straw man, over Ricardo’s treatment of scarcity exceptions. Böhm-Bawerk specifically referred to Ricardo’s acknowledgement of the scarcity exceptions, Murphy writes, and therefore cannot be accused of misrepresenting Ricardo. But where Böhm-Bawerk erred, I think, is in his view of the significance of those scarcity deviations for the over-all validity of Ricardo’s thought. In the passage Murphy quotes, Böhm-Bawerk wrote:

Ricardo himself only went a very little way over the proper limits. As I have shown, he knew right well that his law of value was only a particular law; he knew, for instance, that the value of scarce goods rests on quite another principle. He only erred in so far as he very much overestimated the extent to which his law is valid, and practically ascribed to it a validity almost universal. The consequence is that, later on, he forgot almost entirely the little exceptions he had rightly made but too little considered at the beginning of his work.

Now I have criticized Ricardo myself, in chapter one, for greatly underestimating the extent of scarcity deviations from the cost principle; as Marshall later observed, most prices at any given time deviate considerably from their cost, or equilibrium value. The significance of cost is that it is a normal value toward which actual prices are tending, as illustrated by Marshall’s dangling weight at the end of a string. But one might just as well criticize Ricardo for going too far in the other direction, as well, in treating scarcity as a twin principle of value alongside of cost (like the “short-run” blade of Marshall’s scissors). Although Ricardo underemphasized the extent of scarcity deviations, in elevating scarcity to an independent force equal to cost, he overemphasized its significance. Although actual prices almost always differ from their “normal” values, because of scarcity, the deviations are entirely secondary to the primary law of cost.

Murphy criticizes my use of gravitation and ballistics as metaphors to illustrate scarcity as the cause of secondary deviations from the primary law of cost. But in the specific sense in which I used it — that the natural tendency of an object under the pull of gravity is to fall toward the center of the earth, unless obstructed by secondary forces — I still consider it an apt illustration. In fact, my intention in using the gravity metaphor was essentially what Murphy recommends as a “better” one: “Gravity makes everything fall,” a law which is “generally true, but is offset by disturbing forces.” Indeed, “disturbing forces” is an excellent phrase for describing the relative importance of scarcity deviations from the more general tendency of cost — I wish I’d thought of it myself. What I was trying to convey, perhaps badly, was something like Marshall’s metaphor of the dangling weight always moving back toward center despite disruptions.

In any case, we are left with a question that’s largely a matter of subjective judgment. If a theory of exchange value says that “the general tendency is toward value x, with secondary deviations caused by y,” is it fair to treat y as an “exception” to that statement? I believe we’ve reached the point where we must agree to disagree on that question; there’s no appeal to objective fact that can settle it. My own judgment is that the sacrifice of “theoretical generality,” if it in fact exists, is necessary for adequately dealing with the complexity of reality. But there are some practical considerations involved in choosing one theory over the other.

Murphy himself concedes that “the long-run tendency for a reproducible good’s price to equal the money expenditures … necessary for its continued production is entirely compatible with the marginal utility explanation.” And, I might add, the subjectivist marginal utility explanation of individual behavior in a market is entirely compatible with the framework of classical political economy. Indeed, that explanation was implicit in classical political economy as a mechanism for how the law of value operated through the forces of supply and demand. The virtue of the subjectivist/marginalist paradigm is that it made this mechanism explicit. By providing an explicit subjective mechanism for short-term price determination, at the point of sale, the marginalists made a great advance. But their great advance would have been better incorporated into a higher synthesis of the classical paradigm, rather than set up in opposition to it.

Murphy considers unexceptionable the subjectivists’ goal of greater generality and elegance. As I wrote in chapter one, quoting Buchanan from Cost and Choice (1999, p. 9), the subjectivists took the classical political economists’ paradigm for scarce goods (like works of art and heirlooms, or food in a besieged city), and elevated it into a paradigm for the study of all exchange-value, by treating quantities as fixed at the point of sale. This is, indeed, a greater formal unity. And Böhm-Bawerk’s marginal pairs are a brilliant way of understanding the formation of spot prices. The question, however, is whether the admitted “greater generality” achieved by applying the rules for scarce goods to all goods in this way, outweighs the obscurity it casts on many of the central questions and insights of classical political economy.

The classicals’ insight that price moves toward cost, unless impeded by secondary factors, is a vitally important one. When coupled with the insights of the radical disciples of Ricardo, on the role of “artificial rights of property” and other state-created scarcities, in causing deviation from the cost principle, the conclusions are revolutionary. And at least as usually explicated, much of the work of the early marginalist/subjectivists in the political context of their time seems deliberately designed to obscure these insights. Sacrificing these insights for the sake of what is, admittedly, greater formal elegance, would in my opinion be a great mistake.

As a minor issue, finally, Murphy mentions my use of the term “equilibrium price” in a sense that’s no longer in current use; as I use it, he says, it is closer in meaning to what Mises meant by final price. In my book, I admittedly use “equilibrium price” in the archaic, nineteenth century sense of the natural value toward which prices are tending. But I believe I explicitly mentioned Mises’ “final price” as something like it, in answering Austrian objections that the “long-run” doesn’t exist.

Moving on from our main point of contention, Murphy brings up some other points. My argument, in chapter two, is that labor is unique among the factors of production in that it carries a positive and absolute disutility. The “abstention,” “sacrifice,” “waiting,” or “opportunity cost” associated by other schools with the provision of land and capital is entirely situational, and may derive entirely from a legalistic position from which one may refrain from obstructing access. I quote Maurice Dobb’s example of state grants of power to obstruct roads and set up private tolls, and the resulting “productivity” of this “factor” when the toll-keeper allows free passage. I expand on the point, arguing that by the very same principle a slave-owner is “contributing” a “factor” to production by renting the labor of his slaves. Murphy replies:

yes, Mr. Carson, that is exactly how I would explain the pricing of slaves. … The subjective theory of value can explain prices even under conditions that do not conform to our sense of justice. I can also analyze the effects of, say, a tariff on cars, even though I consider tariffs to be immoral and inefficient.

Fair enough. I have no quarrel with a theoretical mechanism to explain the pricing of slaves, passage through private checkpoints, goods protected by tariff, or anything else. But that does not in any way alter the fact that such pricing reflects an artificial scarcity created by a state grant of privilege; and the “abstention” or “sacrifice” or “opportunity cost” involved does not carry anything like the moral significance commonly attached to those terms (“the abstemious capitalist”) in popular capitalist apologetics. My point was that such “opportunity costs” were entirely relative to an artificially privileged position of control over access, and thus differ fundamentally from the real sacrifice involved in the disutility of labor. More importantly, I intended to make the point (and succeeded, in my opinion) that such artificial scarcities of “factors of production,” based on legal privilege, are the most important cause of long-term deviations from labor-value.

Murphy also raises a question that, I confess, I found a stumper at first. In defending the real (and not relative) disutility involved in opportunity cost, he gives the examples of the owner of a tract of virgin forest who experiences real discomfort at the idea of the trees being cut down, and of a widow “forced to pawn her wedding ring to avoid starvation.” But after some consideration, I decided that the examples are irrelevant to factor prices in a capitalist economy. While the subjective pain may be real, the subjective significance of such unique and unreproducible goods has little to do with the market prices of inputs that are generally treated, at least on the larger scale, as uniform and homogenous. The widow’s ring cannot be considered a factor of production at all, except to the extent that the money from its sale might be invested in production (as opposed to food, in Murphy’s example). And while the sentimental value of the trees may influence the “opportunity cost” of selling the land for Mr. Murphy, the price at which he can find a willing buyer will be determined by what land will generally fetch, which takes us back to the role of the state’s “artificial right of property” in determining the price of vacant land. The opportunity cost by which factor costs are generally set in the broader capitalist economy reflects the standard returns which are available to various uses of a factor given the existing legal and institutional framework. While the sentimental value of the forest or the ring may have a big effect on the price at which Mr. Murphy or the widow is willing to sell them, it has little to do with the prevailing market price of factors of production for a buyer who isn’t interested in such unique qualities.

For that matter, the fact that the land is (as Murphy specifies) virgin forest indicates that it has not been altered by his labor, or the labor of anyone else in the past; and since his property claim, under these conditions, does not even come up to Rothbard’s Lockean standards, it amounts to a case of what Jerry Tuccille called “anarcholand grabbism” (Tuccille 1970, p. 3). Which brings us back to my original point: artificial scarcity, in this case from state-enforced monopoly of land that has never been legitimately homesteaded.

Moving on, Murphy critiques my discussion of time preference in chapter three. He objects to my treatment (actually borrowed from Maurice Dobb) of time preference as a scarcity rent on present labor, owing to its increased disutility, as “just another factor in the ‘haggling of the market’ [Adam Smith], by which labor’s product is allocated among laborers.” This, says Murphy, “will simply not do.” It is, he says, confusing the lower utility of a future product with the higher disutility of present labor. But in practical terms, I believe they translate into something quite similar. I am aware of the theoretical distinction. But we’re all familiar with the fable of the grasshopper and the ant; and in that story, the greater unpleasantness of labor today than labor mañana, and the lesser weight given to “jam tomorrow” than “jam today,” amount in common sense understanding to pretty much the same qualities of human nature. Rothbard himself sometimes blurred the distinction between time preference and Marshallian “waiting” to an extent that would surely have grieved Böhm-Bawerk (Rothbard 1993, pp. 294–95, 298); Roger W. Garrison argued, in his turn, that the concept of “waiting” as a factor of production was compatible with Austrian time preference (Block and Rockwell 1988, p. 49). Similarly, I believe Böhm-Bawerk’s time preference theory belongs in a broader category of closely related theories (along with Senior’s abstinence and Marshall’s waiting), and probably represents less of a radical, qualitative break with his predecessors than he would have wished to believe.

Finally, Murphy quotes my statement that “[i]t is only in a capitalist (i.e., statist) economy that a propertied class … can keep itself in idleness by lending the means of subsistence to producers in return for a claim on future output.” He raises the question of what happens in a mutualist society

if an industrious worker accumulates a large stockpile of consumer goods, and sells them in exchange for future goods? Could he not live indefinitely off the interest? Would this be forbidden, or does Carson just deny that it would ever happen in the absence of state intervention?

The answer, of course, is the latter. With Benjamin Tucker, I say that, if the worker can manage to accumulate such a stockpile of goods through his own efforts, unaided by state-enforced monopolies; and if he can find a borrower willing to deal with him on such terms — in that case, more power to him! But in the absence of a usurious monopoly premium on credit brought about by the state’s market entry barriers in banking, with the availability of cheaper credit alternatives through mutual banks, and with far less steep time preferences in a society with wider distribution of property ownership, I think he’ll have a much harder time finding a taker for such a deal than do present-day lenders.

One of Mr. Murphy’s criticisms I found entirely legitimate. My book has little to say about absolute price levels. I paid that issue little mind, believing that relative exchange value was the main issue of contention between the labor and subjective theories. But the work of Mises and the later Austrians on that subject is certainly worthy of more consideration, and if I ever publish a revised edition of Mutualist Political Economy I hope to give it greater attention.

3. Rejoinder to Walter Block

At the outset of his review, Walter Block remarks that “[t]his is an infuriating book.” Shortly afterward he comments, half in jest, that the obvious amount of effort that went into researching and writing it is “one more indication of the weakness of the labor theory of value.” I might respond, in the same spirit, that the extent of his frustration, despite manifestly having put so little effort into a careful reading of the book, is an indication of the disutility of labor.

One thing he finds especially upsetting is that, despite my showing “great familiarity with many of the most important libertarian contributors to the field of political economy” (including “no fewer than nine” of Rothbard’s publications), that familiarity “seems to have been wasted on Carson, as he adopts the labor theory of value of all things as the basic building block of his analytic framework.” This is a very telling comment. The appropriate response upon reading his list of authorities, apparently, is not critical analysis, but genuflection. Indeed, Block’s response to most of my criticisms of the Austrians amounts to little more than talking past them, and reasserting some dictum of Böhm-Bawerk or Mises that ”everybody knows,” without ever directly addressing my counterarguments.

In fact, Block’s approach reminds me of the Böhm-Bawerk quote from Capital and Interest that I use as an epigraph for my book:

I have criticized the law of Labour Value with all the severity that a doctrine so utterly false seemed to me to deserve. It may be that my criticism also is open to many objections. But one thing at any rate seems to me certain: earnest writers concerned to find out the truth will not in future venture to content themselves with asserting the law of value as has been hitherto done.

In future anyone who thinks that he can maintain this law will first of all be obliged to supply what his predecessors have omitted — a proof that can be taken seriously. Not quotations from authorities; not protesting and dogmatizing phrases; but a proof that earnestly and conscientiously goes into the essence of the matter. On such a basis no one will be more ready and willing to continue the discussion than myself.

I attempted such a proof, in part one of my book. Now the shoe is on the other foot. Some subjectivists, like Bob Murphy and Roderick Long, are responding with the sort of thoughtful counter-arguments that Böhm-Bawerk hoped for in vain from labor-theory proponents. But all too many subjectivists are guilty of the same intellectual laziness of which Böhm-Bawerk complained in his adversaries. Rather than being able to make a coherent argument as to why goods should exchange in proportion to embodied labor, or to elaborate a mechanism by which this was brought about (Böhm-Bawerk complained), the labor theorists appealed to the authority of Smith, Ricardo, or Marx, as a thirteenth century scholastic might appeal to Aristotle.

Today, similarly, in one mainstream libertarian venue after another, I find that any reference to the labor theory of value is dismissed with similar appeals to the conventional wisdom that “everybody knows.” For example, I constantly encounter arguments picked up second-or third-hand from libertarian polemicists, or from an Econ 101 lecture, that were in fact anticipated and answered by Ricardo or Marx 150 years ago. Hence Block’s resurrection of the “mud pie” chestnut, which you’d think anyone who’d ever read any Ricardo or Marx would be ashamed to recycle under his own name. I also find a lot of “refutations” of things that the classical political economists never said; but since the “refuters” get their arguments second-or third-hand, they have only the vaguest idea of what the objects of their summary dismissal actually said. “Talking points: they’re true because they’re said a lot!”

To return to that old mud pie strawman, Block not only treats the “socially necessary labor” argument as circular, but gives the misleading impression that it was a lamely adopted response to some telling subjectivist criticism. In fact, the idea that the producer is informed of the “socially necessary labor” product, ex post facto, by the price it fetches on the market, was put forth by Marx in his early arguments with Proudhon (see the quote from The Poverty of Philosophy in my rejoinder to Murphy above). So the actual case is just the reverse: the “mud pie” argument was an exercise in intellectual laziness by those who were too ignorant of what they were criticizing to be aware that Marx had “answered” it before it was ever made.

Block’s second refutation considers the elements of “time, risk, and time preference.” Block, apparently, expects me to be dumb-founded by such arguments; rather remarkable, since I devoted an entire chapter to time preference, and explicitly stated in the text that the Tuckerite critique of profit concerned only net profit, or profit on capital as such, and not risk premium. So far as I know, even the most thorough-going mutualist has never objected to the pooling of risk by actuarial mechanisms; and the risk premium is no different from that in principle.

As for “time,” his treatment of it is one of many things in his review that has me wondering how he could possibly have read my book. His argument is nothing but a recycled version of the old labor fund doctrine, in which the provident capitalist comes to the rescue of the hapless laborer who has no savings to live off of during the production process, in return receiving something for his “contribution.” That’s all well and good, except for the question of how the worker came to be so dependent, and how the means of production and the “labor fund” came to be concentrated in the hands of a few people, in the first place.

The answer to this question, which Block gives such short shrift, brings to mind Harry Browne’s quip about the government breaking your legs and then congratulating itself for giving you crutches. A major part of my book is devoted to the history of primitive accumulation, in which the propertied classes (in collusion with the state) robbed the laboring classes of their property in the land.

Regarding time preference, Block complains of the “scant nine pages” devoted to considering it in chapter three: “Very bad form.” But he summarizes my nine-page argument in one sentence, dismissing it without giving his readers any independent basis for understanding what it is he is criticizing. Here’s the sentence he quotes:

When labor abstains from present consumption to accumulate its own capital, time-preference is simply an added form of disutility of present labor, as opposed to future labor.

Unlike Murphy, Block doesn’t bother to answer this argument in itself. He simply proceeds to ask:

This is singularly unhelpful. Where … does Carson think capitalist entrepreneurs arise from, apart from the class of artisans who begin working on their own account, reduce their consumption below income, and use the resultant savings to finance employees on a residual income claimant basis?

Although the reader might not realize it from reading Block’s review, I devoted a considerable portion of my book to answering that question in detail. First of all, despite Block’s apparent misimpression, “capitalist entrepreneur” isn’t a single word. Contra Mises’s misleading summary of the history of the Industrial Revolution, the entrepreneurs who worked themselves up from the “class of artisans” by hard work and abstention provided a minority of total investment capital. They were decidedly junior partners of the owners of the greatest concentrations of wealth: the Whig landed oligarchy and the great mercantile fortunes. Block, you’d think, would be at least aware of the distinction (made by the late Samuel Edward Konkin and other Rothbardian radicals) between entrepreneurs and unproductive rentiers.

Block continues:

It of course cannot be denied that some capitalists get their start out of stolen past labor, as he asserts over and over again, but this need hardly necessarily be the case.

Block, apparently, is channelling Tweedledee: “If it was, it might be; but it isn’t, so it ain’t. That’s logic.” Whether it is the case is a historical question, to which I devoted two entire chapters (four and five) and cited a great deal of evidence — hardly what I would characterize as simply “asserting over and over.” Making unfounded assertions, while ignoring the evidence already produced to the contrary, is more in Mr. Block’s line.

In fact, I did indeed “[have] an answer to Böhm-Bawerk’s devastating critique of socialism.” It’s in the rest of that nine pages, besides that one sentence that Block quotes. This is yet another of those passages which has me wondering whether Block actually read the book, or simply skimmed it for material to put in sneer-quotes and answer with the appropriate boilerplate. Here, for the benefit of the reader who might want some independent basis for evaluation, is an extremely condensed passage from chapter three:

Böhm-Bawerk for the most part stuck to an ahistorical treatment of the actual origins of the distribution of wealth, taking as a given that the propertied classes were in a position of having surplus property for investment as a result of their past thrift or productivity. Often he did not address the issue at all, but simply assumed the present distribution of property as his starting point.

The propertyless laboring classes, like the capitalists, just happened to be there.

Why the laborers might lack individual or collective property in their means of production, or be unable through cooperative effort to mobilize their own “labor fund” in the production interval, Böhm-Bawerk did not say. Why the capitalists happened to be in possession of so much superfluous wealth, he likewise did not speculate. That the bulk of a nation’s productive resources should be concentrated in the hands of a few people, rather than those of the laboring majority, is by no means a self-evident necessity. Böhm-Bawerk himself accepted it as altogether unremarkable. For the cause of such an odd situation, therefore, we will have to look elsewhere than in his work.

The answer lies not in economic theory, but in history. The existing distribution of property among economic classes, about which Böhm-Bawerk was so coy, is the historic outcome of State violence. We shall examine, in a later chapter, the process of primitive accumulation by which the laboring majority has been forcibly robbed of its property in the means of production, transformed into a propertyless laboring class, and since then prevented by law and privilege from obtaining unfettered access to capital.

It will suffice for the moment to say that, although time preference no doubt holds true universally even when property is evenly distributed, the present after-effects of primitive accumulation render time-preference much steeper than it would otherwise be. Time preference is not a constant. It is skewed much more to the present for a laborer without independent access to the means of production, or to subsistence or security. Even the vulgar political economists recognized that the degree of poverty among the laboring classes determined their level of wages, and hence the level of profit.

In an economy of distributive property ownership, as would have existed had the free market been allowed to develop without large-scale robbery, time-preference would affect only laborers’ calculations of their own present consumption versus their own future consumption. All consumption, present or future, would be beyond question the result of labor. It is only in a capitalist (i.e., statist) economy that a propertied class, with superfluous wealth far beyond its ability to consume, can keep itself in idleness by lending the means of subsistence to producers in return for a claim on future output.

The main “critic” of Böhm-Bawerk to which those nine pages are devoted, interspersed with extensive block quotes from Böhm-Bawerk himself, is me — which stands to reason, considering it’s my book.

Perhaps the greatest howlers in Block’s review are his comments on employment relations:

He [Carson] … sees economics as a zero sum game wherein the capitalist can only earn at the expense of the worker. He does not seem to realize that all commercial interactions, particularly including the one between employer and employee, are of necessity mutually beneficial in the ex ante sense. … He … thinks that “profit results from unequal exchange”; pray tell, what is that? In one sense, all exchange is equal, in that both parties gain in the ex ante sense. … He repeats this error about unequal exchange several times. … However, he … sees “capitalist acts between consenting adults” in Nozick’s felicitous terminology … in a positive manner, correctly rejecting the concept of the market as a zero sum game. It is more than passing curious how he can be so sensible in one section of his book, and so prone to error in others.

For an answer to his question, Block need go no further than Franz Oppenheimer (one of his long list of libertarian authorities from whom I failed to benefit). “Unequal exchange” and “zero-sum games” result from state intervention in the market. Free exchange, without state intervention, is indeed mutually beneficial, and creates a Pareto-optimal result in which everyone benefits to some extent and nobody is harmed. That doesn’t have much to do with employment relations in the current economy, however. I reject the idea of the market as a zero-sum game, consistently, in every part of my book. I argue that the present capitalist economy is a zero-sum game because it is not a free market.

Block seems unable to grasp my distinction between how things work under “actually existing capitalism” and how they would work in a free market (ironically, he later accuses me of deliberately obscuring the same distinction — see below). In fact, his defense of existing employment relations in terms of how things work “in a free market” is one of the main identifying features of what I call the “vulgar libertarian.” I quote from chapter four of my book:

Vulgar libertarian apologists for capitalism use the term “free market” in an equivocal sense: they seem to have trouble remembering, from one moment to the next, whether they’re defending actually existing capitalism or free market principles. So we get the standard boilerplate article in The Freeman arguing that the rich can’t get rich at the expense of the poor, because “that’s not how the free market works” — implicitly assuming that this is a free market. When prodded, they’ll grudgingly admit that the present system is not a free market, and that it includes a lot of state intervention on behalf of the rich. But as soon as they think they can get away with it, they go right back to defending the wealth of existing corporations on the basis of “free market principles.”

Against such commentary by Block, I can do no better than to quote Bob Murphy’s review:

I had never really considered the origins of the present distribution of property titles, and Carson makes a strong case that the typical libertarian defense of the modern employer/employee relationship may be quite naïve due to ignorance of the historical development of capitalism.

In another passage on employment issues, Block writes:

States Carson … : “In an order of free and voluntary exchange, all transactions are mutually beneficial to both parties. It is only when force enters the picture that one party benefits at the expense of the other.” This is all well and good, at least superficially. The difficulty is encountered when we realize that for this author “force enters the picture” whenever an employer makes an offer to an employee.

Yes — if wealth is concentrated in the hands of a small number of employers, and employees are deprived of independent access to means of production and subsistence, and the labor market is otherwise made a buyer’s market, all by state action. Then it’s exploitation. Block presents a counter-challenge: what if the employer is a former employee, who saved up a labor-fund from his own wages, and then his fellow employees asked him to bear the risk of a new enterprise? Would I consider this exploitation? No, aside from the caveat that the rate of return he demanded would be influenced by the state’s market entry barriers for banking. And if my aunt had testicles, I’d consider her my uncle!

Among the errors which supposedly mar my work, he accuses me of “conflat[ing] profits (which disappear in equilibrium) with interest (which does not).” That’s only true if you insist on using the politically approved terminology from the Big Austrian Lexicon. In fact, I specifically distinguished what the Austrians call “entrepreneurial profit” from returns on capital as such, although I did not feel obligated to restrict myself to the kewl kids’ jargon.

Another such “error”:

He … thinks there can be such a thing as “free market socialism,” not realizing this is a contradiction in terms, if the latter phrase is used, as per usual, as employed by this author, to strip the capitalists, entrepreneurs, landowners, etc., of their due.

I use the term “socialism” in exactly the same sense as Benjamin Tucker used it in “State Socialism and Anarchism,” to describe a free market in which capital and land are subject to the same laws of competition as labor, without state enforcement of monopoly privileges.

And another: “He … does not seem to understand that ‘monopoly’ necessarily involves government interferences with free entry into an industry.” Considering that I explicitly say that it does, that I define the state’s money monopoly in terms of market entry barriers for the banking industry, and that I rely heavily in chapter six on the Gabriel Kolko/Murray Rothbard treatment of regulatory cartelization, it’s hard to guess why Block doubts my understanding of the principle. Considering the way he reflexively comes to the defense of actual monopolies, created by the state’s entry barriers, and defends them in terms of “how the free market works,” it’s more likely that he doesn’t understand it.

I’m also accused of adopting the “mainstream neoclassical view” of monopoly, as opposed to “the correct Austrian one”; that is, I judge the competitiveness of an industry by the number of firms in it. But if one reads chapter six carefully — and with Block that’s a big if — it becomes clear that I take that position only when the number of firms is artificially low as a result of state action. I don’t believe even Rothbard would object in principle to the idea that prices may become stickier or more stable, through price leadership and other forms of tacit collusion, as the number of firms in a market decreases. But so long as there are no market entry barriers, and no government restraints on competition, that does not alter the fact that prices are fully competitive. I have no quarrel with that position. When competition is artificially restrained, on the other hand (see, e.g., Kolko’s treatment of the effects of “unfair competition” provisions of the FTC and Clayton Acts, and Rothbard on regulatory cartelization), or the number of competitors artificially reduced, by state action, I think it’s fair to refer to an “oligopoly markup” under such conditions.

Time and again, I find myself straining to put an interpretation on Block’s review that doesn’t call either his reading comprehension or his honesty into question. In places, his comprehension is apparently so poor as to suggest that his obtuseness is a mere pose: disingenuousness, in other words. For example:

Our author … approvingly cites Smith (1776) to the effect that “the ‘real price’ of a thing … what it ‘really costs to the man who wants to acquire it’ was ‘the toil and trouble of acquiring it.’” But suppose I am out for a stroll and see a gigantic diamond sitting on a rock. I don’t even have to go through the ‘toil and trouble’ of bending down to pick it up; it is right there, hand high. All I do is seize it. There is virtually no “toil and trouble” involved. And yet this precious stone is worth millions.

If this passage is taken at face value, Block must be almost entirely ignorant of the actual thought of the classical political economists, except as distilled for him in Austrian polemical literature — or at least unwilling or unable to understand their thought on its own terms. It is hard to imagine how anyone could come away from an honest reading of chapter one of my book, let alone The Wealth of Nations itself, without understanding that Smith’s quote applied only to reproducible goods.

And — get this — Block faults me for obscuring the difference between “corporate state monopoly capitalism” and laissez-faire. This, when time and time again he comes to the defense of corporations in the existing fascist economy, responding that corporations can’t exploit workers, or engage in unfair competition, or gouge consumers, because “that’s not how things work in the market economy!” The two systems, as Block says, “are as different as night and day. They have nothing in common.” Precisely my point. The present system is either one, or the other. Take your pick, Mr. Block, and stick to it. Don’t keep jumping from one to the other, depending on which one is most useful to a pro-corporate apologetic. Next, he has the gall to accuse me of doing “all [I] possibly can to bring about confusion in this regard,” and to suggest that I’m guilty of “perhaps a purposeful and willful confusion between the two.” A remarkable case of mirror-imaging, that!

As examples of my willful confusion, I take Mises to task for his defense of the dark satanic mills of the Industrial Revolution, which (he said) workers viewed as preferable to the other available alternatives. Never mind that, as I demonstrated at length, the employing classes were for the most part in active collusion with the state in determining what other “alternatives” were available. But Mises, you see, was only defending them “qua employers”!

And the land thefts I describe in chapters four and five, as central to the creation and development of historic capitalism, are “part and parcel of state monopoly corporate capitalism, not the laissez-faire variety.” Ah, well, that certainly clarifies things. … Except, where has this laissez-faire capitalism ever existed, except in the interstices of the existing state capitalist system, to the extent that politically capitalists and landlords have tolerated it? The central argument of my historical chapters is that capitalism, as an actual historical phenomenon, has been defined by statism from its very beginning; its foundation was “written in letters of blood and fire,” and its ongoing structural features are integrally bound up with statism. Like Ricardian radicals who first used the term “capitalism” in the early nineteenth century, I regard the present system as capitalistic precisely to the extent that it differs from a free market or laissez-faire. And my entire criticism of monopolies, labor exploitation, imperialism, etc., is of that real-world capitalist system. “Carson infuriatingly muddies the waters here, even though he full well knows the difference.” It is Block who muddies the waters; whether he full well knows the difference, only he can say.

Likewise, I fail to distinguish between the two varieties of capitalism in the Industrial Revolution.

Surely, there was some land and other theft, suppression, exploitation. But because of this, our author throws out the innovation baby along with the repression bath water. Surely, we can properly distinguish between the entrepreneur who drags the economy into modernity, and employs children who otherwise would have starved, even if one and the same person were also guilty of violations of the libertarian nonaggression act [sic].

It’s hard for me to believe anyone could intend this to be taken seriously, let alone decide how to answer it. “Surely, we can distinguish between the governments which provides crutches to the cripple who otherwise would have fallen down, even if one and the same government were also guilty of breaking his legs. We’re just defending government qua crutch-provider.” And Block calls me a schizophrenic Jekyll and Hyde character!

The central difference between us, I think, is over the extent to which the present system can be taken as a proxy for the free market. I made it clear in my book that I consider it statist to the core, and to have been so from its very beginning, with genuine free market elements only allowed to operate to the extent that the state capitalist ruling class saw them as being to their interest. Block, apparently, sees the present system as already a fairly close approximation to the free market, with only a few statist lacunae to complicate his picture of a world run by McDonald’s and Wal-Mart without the interference of government regulations or labor unions.

As examples of my purported “economic illiteracy,” Block mentions my references to “scabs,” “dumping,” “collusion,” “price leadership,” etc. In every one of those cases, I criticize the phenomenon in question in the context of the state capitalist system (as my very chapter titles should be enough to tell him). “Dumping,” for example, is mentioned in the context of Schumpeter’s “export-dependent monopoly capitalism” — in much the same way that the Rothbardian Joseph Stromberg uses it in his article “The Role of State Monopoly Capitalism in the American Empire” (2001, pp. 57–93).

Another example of my economic illiteracy, according to Block, is this: “Demobilization of the war economy after 1945 very nearly threw the overbuilt and government-dependent industrial sector into a renewed depression.” Again, read Stromberg’s article for a favorable Austrian spin on the over-accumulation/under-consumption thesis. As Stromberg shows, such analyses by J.A. Hobson and the Monthly Review group are quite apt in the case of state monopoly capitalism. In reference to my discussion of monopoly profit being extracted from consumers, Block responds:

This is of course quite reasonable in the monopoly that emanates in state monopoly corporate capitalism; here, some firms are forbidden entry, and the privileged others can certainly exploit consumers. But how in bloody blue blazes can this take place under laissez faire capitalism?

Um, Mr. Block? Just read the title of chapter six, from which this is cited: “The Rise of Monopoly Capitalism.”

As a final example of my economic illiteracy, Block mentions my discussion of large firms that operate well above the level of optimal efficiency, far beyond the point at which economy of scale levels off.

In our author’s view … bigness is badness. But only the market can determine how big is too big. And, if a firm exceeds this barrier, whatever it is, market forces will soon rein it in. Companies such as Microsoft, Wal-Mart, Coca-Cola, and McDonald’s are truly gargantuan. Does this mean they are too big? Not a bit of it. Were this so, they would now be well on their way toward a reduced size.

Well, I’m tempted to speculate that some form of illiteracy is at work here, at any rate. How he could have got that from reading the actual text is beyond me. In fact, he stands my position on my head. I don’t believe any form of intervention by the state or any other coercive body is necessary to impose a limit on size. As Block says, that’s a job for the free market; but unlike Block, I think a description of the functioning of a free market calls for the subjunctive case, not the indicative. Wal-Mart, McDonald’s, etc., would indeed be on their way toward reduced size, in a free market. Does Block honestly assert that they currently function in a free market? If so, he should cheerfully retract, with an apology, his accusation that I blur the distinction between laissez-faire and state capitalism. In the passage in question, I argued that the present size of most (if not all) large corporations reflects existing state intervention in the economy, either to cartelize industry through regulations, to subsidize accumulation, or to externalize the inefficiency costs of large size. My argument is that the size of McDonald’s, et al., reflects the nature of the state capitalist system, and that a genuinely free market would break them down into much smaller, more efficient firms. Once again, as a vulgar libertarian, Block seems to forget from one moment to the next just what it is he’s defending.

But, perplexingly, he goes on immediately afterward to comment: “Nor is it easy to see how the government presently props them up.” Now, if he acknowledges that that is my argument — that corporations are able to grow beyond the point of peak efficiency because the government props them up — then his previous insinuation that I want “outsiders” to impose a maximum size on firms must be pure disingenuousness. Either that, or he can’t remember from one minute to the next what he has written. As for the myriad ways in which the government props them up, whether they’re easy for Block to see or not, I describe them at great length in chapter six.

4. Rejoinder to George Reisman

Unlike Walter Block, Mr. Reisman is too exercised to make even a half-hearted attempt at good humor or to acknowledge, pro forma, my well-meaning efforts in writing my book. He immediately goes in for the kill. As the editor warned me ahead of time, the reviews ranged from “we must enlighten our well-meaning and often insightful but at important points misguided comrade,” to “kill the commie!” Reisman, I find, is anchoring the right end of that spectrum.

Reisman’s very title is an exercise in question-begging. And he continues that question-begging in his first paragraph, saying that my book “centers on the incredible claim, self-contradictory on its face, that capitalism, including laissez-faire capitalism, is a system based on state intervention, in violation of the free market.” By the way: if Reisman’s subordinate clause, “including laissez-faire capitalism,” has any meaning at all, it implies that Reisman regards claims of state intervention even in non-laissez-faire capitalism as incredible and self-contradictory.

I deliberately chose to resurrect the original, Hodgskinian sense of the term “capitalism” for the same reason that some twentieth century free market advocates chose to rehabilitate it as a god-term: to make a point. The term “capitalism,” as it was originally used, did not refer to a free market, but to a type of statist class system in which capitalists controlled the state and the state intervened in the market on their behalf. It is still used in this sense by some prominent libertarians. R.A. Wilson, for example:

FREE MARKET: That condition of society in which all economic transactions result from voluntary choice without coercion.
THE STATE: That institution which interferes with the Free Market through the direct exercise of coercion or the granting of privileges (backed by coercion).
PRIVILEGE: From the Latin privi, private, and lege, law. An advantage granted by the State and protected by its powers of coercion. A law for private benefit.
USURY: That form of privilege or interference with the Free Market in which one State-supported group monopolizes the coinage and thereby takes tribute (interest), direct or indirect, on all or most economic transactions.
LANDLORDISM: That form of privilege or interference with the Free Market in which one State-supported group “owns” the land and thereby takes tribute (rent) from those who live, work, or produce on the land.
CAPITALISM: That organization of society, incorporating elements of tax, usury, landlordism, and tariff, which thus denies the Free Market while pretending to exemplify it. (Shea and Wilson 1975, pp 622–23)

As I explained in the book, in these very words, I distinguish “capitalism” from the “free market” precisely to the extent that it is not “laissez-faire.” The point is that “laissez-faire capitalism,” historically speaking, is an oxymoron. “Actually existing capitalism” has been characterized by massive state intervention since its very beginnings. Like Benjamin Tucker, writing in “State Socialism and Anarchism,” I advocate an end to capitalism by means of laissez-faire and free markets.

I have no quarrel with those who deliberately use the term “laissez-faire capitalism” and distinguish it from “actually existing capitalism.” Many self-styled anarcho-capitalists, for their part, have no problem with my usage, so long as we understand each other’s meaning. For a discussion on the nuanced nature of the term “capitalism,” and its history, I recommend Chris Sciabarra’s blog post “Capitalism: The Known Reality” (Sciabarra 2005, Notablog). I do, however, have a quarrel with historical illiterates who are so mired in temporal provincialism as to be unaware that such terms have a history. Reisman, evidently, is among the latter, since he puts “individualist anarchism” in sneer-quotes (as though I’d invented the term), and refers to the labor theory of value as a “Marxist” doctrine.

Reisman also refers to me on virtually every page of his review as a “Marxist,” to the point that it is not only tedious but seems forced. Perhaps he believes that enough repetitions will make the lie stick; but the main effect of such childishness is to highlight his own historical ignorance.

Reisman accuses me of disingenuousness in my treatment of Ricardo’s labor theory of value, since I supposedly ignore his recognition of time and the rate of profit as complicating factors. I am, he says, a labor theory “absolutist,” like Marx, who “recognizes nothing but the quantity of labor expended in production as the source of exchange value.” First of all, there are precious few labor theory “absolutists” in Reisman’s sense. Considering the importance of the general rate of profit and the associated transformation problem in Marxian economics, it should be evident that the rate of profit complicates things as much for Marx as for Ricardo. And the implication in Ricardo himself that profit was deducted from labor-value was picked up by a whole school of Ricardian socialists, who derived radical conclusions from his economics well before Marx came along.

As Reisman later says himself,

Carson, along with all other Marxists, and, it must be said, along with almost all other economists of every persuasion, including Böhm-Bawerk, follows Adam Smith in regarding profit as a deduction from what would otherwise be wages.

In any case, since I not only distinguish entrepreneurial profit and risk premium from return on capital as such, but devote an entire chapter to time preference, it is a stretch to call my labor theory “absolutist.”

In his comments on my treatment of the land monopoly, Reisman again resorts to question-begging:

if I, a legitimate owner of a piece of property, decide to rent it out to a tenant who agrees to pay the rent, the property, according to Carson, becomes that of the tenant, and my attempt to collect the mutually-agreed-upon rent is regarded as a violent invasion of his [the tenant’s] “absolute right of property.” In effect, Carson considers as government intervention the government’s upholding the rights of a landlord against a thief. He believes he has the right to prohibit me and the tenant from entering into an enforceable contract respecting the payment of rent and that such action is somehow not a violation of our freedom of contract and not government intervention.

Since the rules for determining the “legitimate owner of a piece of property” versus the “thief” are the point at issue between the Locke and the Ingalls-Tucker property doctrines, it does Reisman no good simply to assume the matter in contention. Reisman’s critique is only valid if one accepts the Lockean ownership rules as self-evident. Unlike Long, who makes a good effort to argue the case, Reisman simply begs the question. Who is the initiator of force, and who is the defender, depends on how the prior question of ownership rules is resolved. The enforcement of any property rights rules, whether Lockean, Ingalls-Tucker, or Georgist, depends on a local consensus on what constitutes a valid ownership claim. And the enforcement of any such set of rules by a local community will be perceived as legitimate self-defense by the adherents of that property rights regime, and as aggression by adherents of rival philosophies.

Reisman makes the same mistake as Rothbard in characterizing the Greene-Tucker system of mutual banking as one of easy money. The purpose of mutual banks is not “unlimited credit expansion,” but the elimination of entry barriers to the credit market which enable privileged lenders to charge a monopoly price for secured loans. In fact, Reisman goes so far as to say that I seem “totally unaware” of this argument by Rothbard in his article on the Spooner-Tucker doctrine. Unaware, or just unconvinced? Reisman, like Block, reminds me of the labor theory advocates who provoked Böhm-Bawerk’s ire. He, like they, substitutes appeals to authority for reasoned argument.

Next, Reisman enters into an extended discussion of why, apparently, he regards capitalist ownership and wage labor as the only possible way of organizing large-scale production. Although some forms of production require “the assembly of a large aggregate of capital goods and the presence of a large number of workers,” and “cannot be conducted by individual workers each employing his own capital goods,” it does not follow that capitalist ownership and wage labor are the sole means by which labor and productive resources can be aggregated. Reisman objects to my denial of “the necessity of the separation of wage earners from the ownership of the capital goods with which they work”; not only do I deny it, but, in my stiff-neckedness, “[m]ore than once … [depict] the separation as utterly unnecessary.”

So are we to take it that Reisman regards the separation of wage labor from ownership of the means of production as a “necessity” for large-scale production? If so, he doesn’t make himself very clear as to why it’s necessary. He seems to assume, without making any real argument, that the only alternative to the capitalist-owned enterprise is cottage industry and artisan labor.

This theme is coupled with another: my “naïveté” in allegedly yearning for an economy of nothing but cottage industry and artisan labor. It seems that I must agree with Reisman, whether I want to or not, that artisan labor is the only viable form of producer ownership and control of production. Although I have argued that the factory system replaced cottage industry in part for reasons other than technical efficiency, I have never argued that mass production is unnecessary under all circumstances. But what I have actually written can’t stand in the way of Reisman’s effort to pigeonhole me as a romantic medievalist.

He manages to incorporate virtually every point I make about the industrial revolution into this leitmotif of his: my citations of Kirkpatrick Sale and Steven Marglin, for example, proving my pathological nostalgia for the world of William Morris. Thus, Reisman dismisses as a “virtual fairy tale” Sale’s claims about the legal suppression of the tools of cottage industry — without, of course, any regard to whether or not such laws actually existed. “Carson and Sale,” he remarks, “apparently never heard of such things as the Luddites and the later attacks on machinery in 1826, both occasioned by the inability of cottage producers to meet the competition of factories.” Well, that’s certainly an interesting observation, considering that Sale wrote a book about the Luddites (Sale 1995). In any case, the question is not whether cottage producers could “meet the competition of factories,” but what the nature of that competition was — statist or market. It’s hard, after all, to compete with the Godfather.

Reisman takes exception to Stephen Marglin’s claim (in “What Do Bosses Do?”, 1974) that increased efficiency results not from division of labor as such, but from separation of tasks. Marglin argued that a cottage laborer could achieve most of the increased efficiencies of Adam Smith’s pin factory by simply dividing and sequencing the tasks: first drawing out all the wire, then cutting the entire production run, then sharpening it, etc. Reisman’s “disproof”?

It [saving of time from division of labor] would normally not be present in the case of an individual attempting to perform by himself all of the steps involved in the production of a product. For example, if I am assembling, say, a table for my own use. … I would almost certainly be assembling only one such table, and would experience all of the wasted motion entailed in having to pass numerous times from one distinct operation to another. … There would be no room at all for “sequencing” in the sense used by Carson, in such a case. If I were to attempt to produce pins for my own use, I would have need for only a relatively modest quantity, and there would accordingly be only very limited scope for sequencing in Carson’s sense and thus in reducing the motion wasted in passing from task to task.

Marglin was referring to cottage production of pins for the market, with production runs large enough to allow the division and sequencing of tasks. To prove the impracticality of this method, Reisman provides the examples of assembling a single table, and a few pins — in both cases for one’s own use. Apparently, he does not grasp the distinction between cottage production for a commodity market, and production for the household subsistence economy.

Matters are different only when the division of labor has been carried to the point at which there is a regular production of large quantities of a given item for the market. In such a case there is real scope for sequencing in Carson’s sense, and it would save a great deal of wasted motion compared with an individual performing all of the steps in sequence one unit at a time.

Egad! In other words, it would “only” work in the very circumstances I was talking about.

As just pointed out, however, the very existence of this possibility already presupposes the existence of considerable division of labor. It is only a question of whether or not it pays to carry the division of labor further, within the production of the item: i.e., to substitute the greater division of labor present in factory production for the lesser division of labor entailed in cottage production.

Unfortunately, for Carson and Marglin, it very clearly does pay. … It pays because, if for no other reason, factory production is far more efficient in terms of the use of capital goods, and thus of the labor required to produce them, than is cottage production. It avoids the enormous wastes in the form of unnecessary duplication of equipment and idle inventory that would be present in cottage production.

Maybe, yes, but not “very clearly.” As I have already pointed out, I nowhere argued that factory production was never more efficient than cottage production — only that such technical efficiencies were not enough, by themselves, to explain the extent of the “competitive advantage” Reisman writes of, without additional tilting of the playing field in the factories’ direction.

As for the scale of production necessary to make full use of a capital good, that is the textbook definition of internal economy of scale. But the level of output at which that is achieved is an empirical question that varies from one industry to another. Reisman’s a priori ruling out of household production is, therefore, unjustified. In addition, that great fantasist Kirkpatrick Sale devotes a considerable portion of his book Human Scale (1980) to a detailed technical consideration of the possibility that small factories, using multiple-purpose production machinery, could serve local markets of a few tens of thousands with at most only minor increases in unit cost of production.

And please bear in mind that Reisman’s economies of scale are only one side of a coin. There are also diseconomies of scale. There are the increasing internal transaction costs and inefficiencies from added layers of bureaucracy that Oliver Williamson wrote about (1985). There is the internal character of a corporation as a planned economy, with internal pricing of factors separated ever further from external market prices, as its size increases. There is the irrationality involved in the increased difficulty of tracking the costs and benefits of each individual action, so that administrative incentives have to be substituted for market incentives in dealing with personnel (with, of course, all sorts of attendant moral hazard problems). Perhaps most importantly, there are the costs of long-distance distribution. As Ralph Borsodi pointed out decades ago, increased distribution costs offset economies of scale at fairly low levels of output. And further, as Barry Stein showed in Size, Efficiency, and Community Enterprise, (1974) a factory can operate considerably below peak economy of scale (perhaps only a third of optimal output) with only a 5 percent or 10 percent increase in unit cost, which is more than offset by the reduced cost of distribution.

So putting the work of Sale, Borsodi, and Stein together, we find that a decentralized economy of diversified, small-scale production for local use, is quite feasible, with little or no reduction in overall efficiency. And without the state’s subsidies to long-distance shipping, and many of the other diseconomies of large size, that is the likely direction in which a free market would be pushing us. What’s more, the modest scale of the factories required for such local markets would be well within the means of the worker cooperatives that Reisman finds so ludicrous.

Reisman also ridicules me for, in his words, “extolling the virtues of spade cultivation over that of using the plow.” Well, whether Reisman likes it or not, raised bed production with spade cultivation is more productive than mechanized row crop agriculture in terms output per acre, at least in growing vegetables. See, for example, Michael Perelman’s The Myth of Agricultural Efficiency (1977). And the biointensive farming techniques of John Jeavons are, compared to the spade horticulture Perelman writes about, like a Ferrari compared to a Stanley Steamer. Raised bed farming requires higher labor inputs; but mechanized agribusiness, having preferential access to large tracts of land, prefers to economize on man-hours rather than space. On the other hand, the destitute beggars on the streets of Third World cities would no doubt prefer such labor-intensive cultivation of the land that was stolen from them, to their present fate. Further, as counter-intuitive as Reisman may find it, the economies of mechanized farming and food processing are not that great even over the ordinary techniques of the average backyard gardener. Borsodi did a careful study of all the costs (including labor time and supplies) involved in growing and canning vegetables at home, and found that it was cheaper overall to grow one’s own. As I said above, the increased overhead and distribution costs of large scale production offset many of the economies that Reisman is so enamored of.

Another alleged claim Reisman dismisses is that

to induce subsistence farmers to earn money, it is first necessary to impose taxes on them payable in cash, as though the goods available for purchase with cash, which they both desire and would have no means of producing by themselves, would not constitute a sufficient inducement.

Straw man. I did not say that no farmers would be willing to participate in the cash economy without imposing taxes on them — only that state policies forced them to do so on a larger scale than they otherwise would. Or perhaps Reisman does not believe state taxation has any effect on behavior — an odd position for a libertarian. Again, whether Reisman likes it or not, this was the motivation of the British authorities in East Africa and numerous other colonies in imposing poll taxes: to force subsistence farmers into the wage labor market. And those notorious Marxists, the propertied classes of industrial England, were pretty frank in their own assessment of the situation. The literature of the period is full of statements by the landed gentry that enclosures were necessary to get laborers to work for whatever they were offered, because it was impossible to impose proper discipline on a man who wasn’t destitute. Mr. Reisman might profit from reading the work of E.G. Wakefield (1969 and 1834) who advocated limiting colonists’ access to vacant land; the reason, he said, was that it was impossible to make an acceptable level of profit off of labor when workers had independent access to cheap land.

I’ve complained that Reisman never answers the question of why capital might not have been aggregated for large-scale production by laborers themselves, in a free market where the producing classes had not been robbed of their means of production and the state had not preempted the channels of association between them. But in a way, he does provide an answer, in response to this offending passage of mine:

Why could not an artisans’ guild function as a means of mobilizing capital for large-scale production, the same as a corporation? Why could not the peasants of a village cooperate in the purchase and use of mechanized farming equipment: Perhaps because, in the absence of a “progressive” ruling class, they just couldn’t get their minds right. Or maybe just because.

The outraged Reisman accuses me of the great crime of “attributing to the average person qualities of independent thought and judgment that are found only in exceptional individuals.” And again: “Carson is simply unaware that innovation is the product of exceptional, dedicated individuals who must overcome the uncomprehending dullness of most of their fellows, and often their hostility as well.”

Well! So much for Karl Hess’s statement that “libertarianism is a people’s movement”! Uh, shouldn’t Reisman be out defacing a fireplace, or blowing up a copper mine, or something?

It’s especially odd to have Reisman using this passage as evidence of my “collectivism,” since I wrote it to criticize the Marxist dogma that historic capitalism was a necessary “progressive” force that overcome the backward, “petty bourgeois” instincts of peasants and artisans by driving them into the factories like beasts. In his odes to economy of scale and centralization, on the need for one-man management, etc., he sounds like Friedrich Engels. So apparently he is more sympathetic to the collectivists than I am; indeed, he seems to be a Galbraithian technocrat at heart. Perhaps the irony escapes Reisman, who is so fond of calling me a “Marxist”; but I find it delicious.

Reisman constantly repeats, in one form or another, that an economy of simple circulation and self-employed artisan labor would be “one of the most extreme poverty.” He echoes the Marxists in denying that any significant pooling of resources or accumulation of capital could take place outside of the wage system — the separation of ownership from labor. But he produces no evidence for this assertion, aside from his a priori assumption that innovation is the sole preserve of square-jawed, sharp-cheekboned, cigarette-puffing Übermenschen of Galt’s Gulch.

On the subject of innovation, Reisman should read Stein’s Size, Efficiency, and Community Enterprise, mentioned above. Stein found that the overwhelming bulk of productivity-enhancing innovations involved incremental changes in the work process, and that increased productivity was mainly the cumulative effect of such incremental changes. And guess what? The people actually engaged in the work process are most likely to notice ways it might be improved. In my experience, the main reason things get done so irrationally in large organizations is that those who have the most direct knowledge of what’s wrong have the least power to fix it — another example of the poor internalization of consequences of actions in a hierarchy. The simplest change must be submitted to a “suggestion box,” and gestate through seventeen levels of management; if it’s ever heard from again, it comes back down in barely recognizable form like an ukaz from a Soviet industrial ministry. The literature on worker self-management is full of countless studies and volume upon volume on the increased productivity resulting from it. Maybe Reisman could skip his next rereading of Atlas Shrugged and take a look at it.

Reisman objects to my characterization of the historical events of the early modern period, in which the new absolute states of Western Europe used their gunpowder to conquer their own territories and reduce the free cities, and delayed the further development of the intellectual and technical innovations of the High Middle Ages. Whether Reisman likes it or not, the Renaissance did indeed build on the prior cultural achievements of the free cities and monasteries of the thirteenth and fourteenth centuries; and the technical prerequisites for steam-poweredproduction had indeed been developed by that civilization. Much of the industrial revolution in the textbooks involved reinventing the wheel, or taking these earlier developments up again after a prolonged hiatus. On this subject, I recommend Jean Gimpel’s The Medieval Machine: The Industrial Revolution of the Middle Ages (1977).

Reisman describes the late Middle Ages, “along with all the other portions of the Middle Ages,” as “an era ruled by fear and superstition,” and “characterized by such phenomena as famines, plagues, dungeons and torture chambers, burning at the stake, and periodic outbreaks of mass psychosis.” Mercy! I’m glad none of these things ever happened in the early modern period! Dungeons and torture chambers have been associated with states throughout history, limited mainly by the extent of their reach. The reach of the new absolute monarchs being so much greater than that of their medieval predecessors, I doubt the Middle Ages had anything on Henry VIII or Louis XIV in that regard. One of the virtues of the free cities, before the rise of absolutist government, is that they existed largely beyond the reach of central states. Reisman’s picture of the Middle Ages is a cartoonish parody.

Reisman’s disparagement of the Middle Ages is certainly a departure from Rothbard’s position, by the way — especially his contempt for the Scholastics (1998, p. 6). Rothbard devoted over a hundred pages to them in his treatise on the history of economic thought, and referred to them elsewhere as “remarkable and prescient economists” (Rothbard 1995, chaps. 2–4 and 1997, p. 174).

Reisman finds issues of primitive accumulation especially vexing. He mocks Oppenheimer’s thesis of political appropriation of the land, not only denying that it has an effect on the wages laborers are willing to accept, but attempting to minimize the extent to which such land theft even occurred.

But he need go no further than that old “Marxist” Rothbard (heavily influenced by Oppenheimer, by the way), for a treatment of the issue as radical as anyone could want. Rothbard’s view was that artificial scarcity of land raises its marginal value product, and thus lowers wage rates (Rothbard 1977, pp. 132–33).

Reisman denies that the movement of agricultural laborers to the factories had anything to do with “people having been driven from the land or being denied access to it,” insisting instead that it came about solely through their preference for wage labor. And this “choice” was made available by “private ownership of land and respect for the property rights of landowners.” By landowners, of course, Reisman means, not the cultivators who were forced to pay rent on their own land by feudal conquerors, but the heirs of the political appropriators.

Reisman has little respect for the customary property rights of peasants when they come into conflict with the landlord’s need to make a buck. He shows abysmal ignorance of the property rights issues involved in the Stuart land “reform” — going so far as to accuse me of sympathy for the feudal system. The Stuart “reform” did, indeed, replace feudal land tenure with the principle of “private ownership.” But Reisman seems to be unaware that there were two possible ways to transform feudal property into modern private property. One would have been to nullify the “property” claims of the landed aristocracy, which existed only in feudal legal theory, and regularize the de facto title of the peasants cultivators who had been in occupation since before the Conquest. The other would have been to transform the feudal landlords’ nominal property claims into a modern right of private property, and in the process transform the peasants into tenants-at-will.

On this issue, it’s clear where Murray Rothbard’s sympathies lay. Here is his take, in chapters 10 and 11 of The Ethics of Liberty, on feudalism, by which he meant “continuing aggression by titleholders of land against peasants engaged in transforming the soil”:

But suppose that centuries ago, Smith was tilling the soil and therefore legitimately owning the land; and then that Jones came along and settled down near Smith, claiming by use of coercion the title to Smith’s land, and extracting payment or “rent” from Smith for the privilege of continuing to till the soil. Suppose that now, centuries later, Smith’s descendants (or, for that matter, other unrelated families) are now tilling the soil, while Jones’s descendants, or those who purchased their claims, still continue to exact tribute from the modern tillers. Where is the true property right in such a case? It should be clear that here, just as in the case of slavery, we have a case of continuing aggression against the true owners — the true possessors — of the land, the tillers, or peasants, by the illegitimate owner, the man whose original and continuing claim to the land and its fruits has come from coercion and violence. Just as the original Jones was a continuing aggressor against the original Smith, so the modern peasants are being aggressed against by the modern holder of the Jones-derived land title. In this case of what we might call “feudalism” or “land monopoly,” the feudal or monopolist landlords have no legitimate claim to the property. The current “tenants,” or peasants, should be the absolute owners of their property, and, as in the case of slavery, the land titles should be transferred to the peasants, without compensation to the monopoly landlords. (1998, pp. 66, 69)

Even Mises, surely more conventionally right-wing than Rothbard, had this to say on the land question:

Nowhere and at no time has the large-scale ownership of land come into being through the working of economic forces in the market. It is the result of military and political effort. Founded by violence, it has been upheld by violence and by that alone. As soon as the latifundia are drawn into the sphere of market transactions they begin to crumble, until at last they disappear completely. Neither at their formation or in their maintenance have economic causes operated. The great landed fortunes did not arise through the economic superiority of large-scale ownership, but by violent annexation outside the area of trade. (1951, p. 375)

But Reisman’s sympathies are four-square on the side of the feudal landlords. He defends the enclosures, for example, as a mere exercise of “the right of landowners to fire unnecessary workers” — a matter-of-fact assertion comparable to the one in 1066 and All That that the Pope and all his bishops seceded from the Church of England. The commons were the joint property of the villagers; enclosure was theft, pure and simple. But Reisman is not above justifying such theft on pragmatic grounds, for the effect of land consolidation in making possible the rise of scientific farming. Apparently, for Reisman the violation of property rights is perfectly all right so long as it promotes “progress.” If a piece of stolen property can be put to more productive use by the thief, the theft is justified by the verdict of history. I’d be interested in Reisman’s take on Kelo.

Even when Reisman admits that expropriations of peasant land took place, he asserts, incredibly, that “there is no reason for thinking that the basic pattern of the economic system in terms of the preponderance of employment as a wage earner versus self-employment would be significantly different” without such expropriations. Of course, he makes (once again) the implicit assumption that wage labor and separation of labor from ownership is the only way of accumulating capital and organizing mass production — a nation of peasant proprietors and self-employed artisans being unable to voluntarily organize cooperative labor without John Galt as overseer.

In concluding his treatment of my account of primitive accumulation, Reisman repeats his assertion that it is “simply groundless.”

As we have seen, what has led to the separation of labor from the land is not any injustices that may have been committed in connection with enclosures or anything else, but the rise in the productivity of labor in agriculture and mining.

No; what “we have seen” is Reisman’s repeated assertion of that claim, in the process ignoring the great bulk of my specific evidence to the contrary, as to how the state in fact did expropriate the land from the laboring classes, and then intervened through such social controls as the Laws of Settlement and the Combination Laws to reduce the bargaining power of workers in the labor market. His modus operandi is to summarize, badly, my general line of argument (when he does not utterly misrepresent it), while ignoring the supporting evidence, and then make facile, sweeping counter-claims with little or no evidence. He concludes by repeating his unsubstantiated assertion, with a rhetorical flourish, as evidence (“we have seen”). Still more incredibly, he asserts that his version of events is “implied by economic science” — certainly the most amazing feat of a priori deduction that I’ve ever seen.

It makes no difference whatsoever to the present “pattern of organization of a capitalist economy” whether capital was accumulated by laboring classes pooling their own resources, or the resources were pooled by thieves who then hired the laboring classes to work the accumulated means of production. No difference except to those doing the work, perhaps.

Reisman also argues that it doesn’t really matter whether the laboring classes were robbed of their property in the past, because even without such robbery it would have wound up concentrated in the most efficient hands, anyway. Although Reisman doesn’t actually invoke the name of Coase, his specter hovers over this passage nonetheless.

On the matter of primitive accumulation, there is an amazing parallel between Reisman and that most vulgar of vulgar Marxists, Friedrich Engels. Engels, in Anti-Dühring, argued that the process of primitive accumulation would have taken place in exactly the same way without any state expropriation whatsoever, solely through the effects of success and failure in the free market. Essentially, Engels retreated from Marx’s entire body of work on primitive accumulation, in which he described the massive expropriation of the peasantry, “written in fire and blood.” Engels, in effect, embraced the “bourgeois nursery tale” of primitive accumulation, ridiculed by Marx and Oppenheimer alike, in which the present distribution of property reflects an endless series of victories by the industrious ant over the lazy grasshopper. Marx himself, for that matter, was on the defensive about the logical implications of his history of primitive accumulation. Why? There was an entire school of radical classical liberals and market-oriented Ricardian socialists who argued that state robbery and state-enforced unequal exchange were the causes of economic exploitation. As Maurice Dobb wrote in his introduction to Marx’s Contribution to the Critique of Political Economy:

the school of writers to whom the name of the Ricardian Socialists has been given … who can be said to have held a “primitive” theory of exploitation, explained profit on capital as the product of superior bargaining power, lack of competition and “unequal exchanges between Capital and Labour.” … This was the kind of explanation that Marx was avoiding rather than seeking. It did not make exploitation consistent with the law of value and with market competition, but explained it by departures from, or imperfections in, the latter. To it there was an easy answer from the liberal economists and free traders: namely, “join with us in demanding really free trade and then there can be no ‘unequal exchanges’ and exploitation.” (Marx 1970, p. 13)

And as I commented in my book, this “easy answer” was exactly the approach taken by Thomas Hodgskin and the individualist anarchists of America. The greatest of the latter, Benjamin Tucker, reproached as merely a “consistent Manchester man,” wore that label as a badge of honor. Engels was facing something similar, in Eugen Dühring’s “force theory” of economic exploitation. He was forced to retreat from Marx’s history of primitive accumulation, because he found the implications of that history politically and strategically intolerable. I suspect Reisman is forced to repudiate it for similar reasons.

Walter Block included Oppenheimer and some other leftish free market radicals in his list of libertarian luminaries from association with whom I failed to benefit. Reisman, on the contrary, is satisfied with a brief snarl at Oppenheimer’s theory of political appropriation of land as the necessary basis for economic exploitation. In repudiating him, of course, he repudiates not only Albert Nock, whom most of even the conventional free market milieu regards as something of a demigod; he also repudiates Rothbard. In short, Reisman circles his wagons much more closely than Block, in his single-minded obsession with defending the distribution of property under actually existing capitalism. Reisman is willing to cut himself off from a huge part of the free market libertarian tradition, as one might amputate a gangrenous limb, in order to save what he views as its heart: the defense of that last and best of oppressed minorities, Big Business. He cuts himself off from the entire radical legacy of early classical liberalism, and its transmitters like Oppenheimer and Nock (who had such a profound influence on Rothbard himself), in order to make common cause with the rich and powerful. He is forced to repudiate an entire strand of Rothbard’s thought, on which (as Long says in his review article) the socialist strand of individualist anarchism had such a formative influence.

Reisman also devotes a considerable portion of his review to promoting a novel idea of his own: that wages are a deduction from what would otherwise be profit. In this view, the net sales revenue of artisan laborers after expenses was profit; the rise of the wage system meant the deduction of wages from this profit for the first time. Of course, the net revenue after expenses was the reason the artisan was expending effort: income to support himself. And if this income weren’t enough to compensate him for his effort, he’d cease to work. In Reisman’s own words, profits, not wages, are the original and primary form of labor income. So call it what you will, even Reisman admits that the original form of income was labor income. The remuneration of labor, beyond a repayment of cost outlays on raw materials and tools, is what motivates self-employed laborers to work; whether Reisman calls it “wages” or “profit” is beside the point. So, novelty notwithstanding, Reisman’s argument strikes me as a distinction without a difference.

Reisman, like Block, shows the vulgar libertarian tendency to forget from one minute to the next what it is he’s defending: the winners in the existing system, or free market principles as such. He repeatedly argues that small-scale farming and manufacture couldn’t be more efficient than the large corporations, because if they were the large corporations would be losing out in competition. He effortlessly shifts back and forth from the indicative to the subjunctive in his description of how a free market either does, or would, operate, depending on its strategic usefulness for the defense of big business:

In those instances in which larger-scale production or larger-scale ownership … is in fact relatively inefficient, a free market operates to replace it with more efficient smaller-scale operation or ownership.

Well, yes, a free market would do so. Is this a free market? Yes or no? If yes, then the present size of big business reflects superior performance. If no, then the real isn’t necessarily rational.

Like Block, Reisman objects to my treatment of over-accumulation and under-consumption, under twentieth century state capitalism, and the resulting drive to imperialism. Like Block, he shows some confusion as to just what he’s defending, at one point conceding that state capitalism exists to some extent — but then later denying, on the basis of free market principles, that tendencies toward over-accumulation and under-consumption can exist. Again, I refer him (like Block) to Stromberg’s ground-breaking article, “The Role of State Monopoly Capitalism in the American Empire” (see previous citation) for an Austrian treatment of those phenomena. As I said before, Reisman is forced to cut himself off from the best of his own tradition, because it might compromise his attempt to out-Mises Mises in defense of big business. And he is forced to abandon the entire New Left analysis of state capitalism — Weinstein,Kolko, Williams, etc. — that Rothbard made such productive use of, because it undermines his strategic position.

Finally, I readily concede the accuracy of one of Reisman’s criticisms: that my analysis of Böhm-Bawerk was based on Smart’s translation of the first German edition, rather than the third German edition. If I publish a new edition of the book, I will remedy that defect.

5. Rejoinder to Roderick Long

First, a clarification: Since I used the phrase “common patrimony” in my book to characterize both the Georgist and the Ingalls-Tucker view of land, I’ve learned that some Georgists regard the “common” right as several, rather than collective: that each individual has, as a birth-right, an equal and independent right of access to land. And since favorably situated sites are not a reproducible commodity, something like the “law of equal liberty” implies the payment of compensation to the excluded. The community is not the collective owner, but simply the agent of all individual human beings, severally, in guaranteeing their individual rights of access to the commons.

Tucker, similarly, deduced this right of access, via the “equal liberty” principle, from self-ownership.

So, technically speaking, the mutualists and Georgists do not erect mankind’s common patrimony in the land into a separate and independent principle apart from self-ownership. But it follows so directly from the latter as to approach the status of an independent axiom.

Long challenges the common patrimony claim on the grounds that mankind has never established a legitimate claim to the Earth by collective labor-homesteading. (It strikes me that this objection would apply just as well to the several rights of equal access described above.) As ingenious as this argument is, I must counter that mankind’s collective (or “common”) right in the land as a patrimony, and the individual property right established by labor-homesteading, are two entirely different sets of rules for entirely different classes of “ownership.” Long is arguing apples and oranges. The rules for individual appropriation by labor exist in the light of the broader and more fundamental principles of mankind’s common access rights to the land, and are a way of implementing this common right in accordance with the principle of equal liberty.

Although Long goes on to anticipate my possible argument that mankind’s common right of access, and individual property rights established by labor-appropriation, are two separate classes of rights, he argues that the former is a violation of the right of self-ownership. The individual, in mixing his labor with natural resources, makes it an inalienable adjunct to his person in exactly the same sense as his body.

As ingenious (again) as this theory is, I don’t believe it stands up to scrutiny any more than Long’s first argument. As Nozick pointed out, a property rights theory includes not only rules of initial acquisition, but rules for transfer and abandonment. As Bill Orton argued (quoted in chapter five of my book), all property rights theories, including Lockean, make provision for adverse possession and constructive abandonment of property. They differ only in degree, rather than kind: in the “stickiness” of property, as Orton puts it. There is a large element of convention in any property rights system — Georgist, mutualist, and both proviso and nonproviso Lockeanism — in determining what constitutes transfer and abandonment. And labor homesteading of land entails such an element of convention even in ascertaining how much land is actually appropriated, with a resulting degree of uncertainty as to the boundary between self and nonself that does not arise as to the body. These considerations, taken together, would seem to indicate that the acquisition of land does not bring it into the same intimate and inalienable association with one’s ego as does ownership over one’s own body.

In response to Long’s final challenge, as to the extent of common patrimony (e.g., an alien race’s hypothetical claim on the entire universe as the common patrimony of all intelligent life), I can only reply that it would come into play under exactly the same circumstances as Locke’s proviso: when more than one being desires the same parcel of land, and possession by one excludes competing access claims by others. Land monopoly is a moot point until the local demand for locations exceeds their supply.

Of course, Tucker’s understanding of the law of equal liberty ignored all these considerations, and was established on purely Stirnerite grounds: in a stateless society, an invisible hand mechanism would eventually lead to such a mutual recognition of equal access rights as a way to minimize conflict. Per Bylund also has a couple of interesting new pieces on these issues, by the way. In one of them, his master’s thesis, he presents a novel argument reassessing the basis of the self-ownership principle (Bylund 2005a). In the other, he attempts to resolve the conflict between Lockean and possessory theories of property (2005b).

I do welcome Long’s position on collective homesteading, and on the commons as a form of joint private property. It would go a long way toward remedying the atomistic excesses of some vulgar libertarians, who deny that collective rights can exist — and have used such arguments to justify the nullification of tribal claims to hunting grounds, villagers rights to the common (see Reisman’s review, for example), etc. Even this proposal, of course, requires a set of conventional rules as to how much common labor is needed to appropriate how much surrounding land and resources.

Long’s allowance for collective homesteading may also provide more eirenic possibilities than even he envisioned, by making much of the dispute between us a moot issue. Arguably, the only criterion for determining whether common ownership of land exists in a given community, and the extent of those common rights, is the local conventions of property ownership, written or unwritten, that have grown up over time. So whether a given community possesses common rights in accordance with Georgist or mutualist or Lockean principles, essentially depends on what a majority of the local population says the rules are. We are left, as a result, with a panarchy in which competing local property systems exist side by side — peacefully, let us hope.

As a practical matter, it would be prohibitively expensive to enforce the mutualist, Georgist, or Lockean property claims of dissidents in a community which is predominantly of another persuasion. Soanarcho-capitalist protection agencies would have exclusionary clauses for absentee landlord claims in a neighboring Tuckerite community, mutualists would refrain from invading the neighboring Rothbardian community to defend the cultivator against his landlord, and so forth. And sparsely populated areas, in practice, would be governed by de facto possessory ownership, because in most cases the free market cost of hiring enforcers of an absentee ownership claim against squatters would probably outweigh the value of the land. In the end, a peaceful panarchy would evolve in the absence of the state, because war simply wouldn’t pay.

<< Back to Studies in Carsonian Mutualism.

References:

Block, Walter, and Llewellyn H. Rockwell, Jr. 1988. “Professor Rothbard and the Theory of Interest.” In Man, Economy and Liberty: Essays in Honor of Murray N. Rothbard. Walter Block and Llewellyn H. Rockwell, Jr., eds. Auburn, Ala.: Auburn University Press.

Buchanan, James. 1999. Cost and Choice: An Inquiry in Economic Theory. Vol. 6, Collected Works. Indianapolis: Liberty Fund.

Bylund, Per. 2005a. “Man and Matter: A Philosophical Inquiry into the Justification of Ownership in Land from the Basis of Self-Ownership.” (Lunds Universitet, 2005). http://www.perbylund.com/academics_ polsci_msc.pdf.
———. 2005b. “Private Property or Possession: A Synthesis” (September 7, 2005). http://www.anarchism.net/anarchism_privatepropertyorpossessionasynthesis.htm.

Gimpel, Jean. 1977. The Medieval Machine: The Industrial Revolution of the Middle Ages. New York: Penguin.

Marglin, Steven A. 1974. “What Do Bosses Do? The Origins and Functions of Hierarchy in Capitalist Production—Part I.” Review of Radical Political Economics 6:2 (Summer). Available online at http://post.economics.harvard.edu/faculty/marglin/papers/What_Do_Bosses_Do.pdf

Marx, Karl. 1970. Contribution to the Critique of Political Economy. New York: International Publishers.

Marx, Karl, and Friedrich Engels. 1884. Preface to the First German Edition of The Poverty of Philosophy. In Collected Works, vol. 26 1990. New York: International Publishers. Pp. 286–87.

Mises, Ludwig von. 1951. Socialism. New York: Yale University Press. Perelman, Michael. 1977. “Farming for Profit in a Hungry World: The Myth of Agricultural Efficiency.” In The Political Economy of Food and Energy (Ann Arbor: University of Michigan, 1977).

Reisman, George. 1998. “The Scholastics Contributed Nothing to Sound Economics.” Capitalism: A Treatise on Economics. Ottawa Ill.: Jameson Books.

Rothbard, Murray N. 1998. The Ethics of Liberty. New York: New York University Press.
———.1997. The Logic of Action I: Method, Money, and the Austrian School. Cheltenham, U.K.: Edward Elgar.
———.1995. Economic Thought Before Adam Smith: An Austrian Perspective on the History of Economic Thought. Vol. I. Cheltenham U.K.: Edward Elgar.
———.1993. Man, Economy, and State: A Treatise on Economic Principles. Auburn, Ala.: Ludwig von Mises Institute.
———.[1970] 1977. Power and Market: Government and the Economy Kansas City: Sheed Andrews and McMeel. P. 59.

Sale, Kirkpatrick. 1995. Rebels Against the Future. Reading, Mass.: Addison-Wesley.
———. 1980. Human Scale. New York: Coward, McCann and Geoghegan.

Sciabarra, Chris. 2005. “Capitalism: The Known Reality.” Notablog. (Feb. 4) available online at http://www.nyu.edu/projects/sciabarra/notablog/ archives/000288.html.

Shea, Robert, and Robert Anton Wilson. 1975. The Illuminatus! Trilogy. New York: Dell. 136.

Stein, Barry. 1974. Size, Efficiency, and Community Enterprise. Cambridge, Mass.: Center for Community Economic Development.

Stromberg, Joseph. 2001. Journal of Libertarian Studies 15, no. 3 (Summer):57–93, available online at http://www.mises.org/journals/jls/15_3/ 15_3_3.pdf.

Tuccille, Jerry. 1970. “Bits and Pieces.” Libertarian Forum (November 1): 3.

Wakefield, E.G. [1849] 1969. A View of the Art of Colonization. Reprints of Economic Classics. New York: Augustus M. Kelley.
———. 1834. England and America. New York: Harper and Brothers.

Williamson, Oliver. 1985. The Economic Institutions of Capitalism: Firms, Markets, Relational Contracting. (New York: New York Free Press; London: Collier Macmillan, 1985).

An article at Medium (Tim O’Reilly, “Networks and the Nature of the Firm — What’s the Future of Work?” August 14) describes Uber and Airbnb as “textbook examples” of “the way that networks trump traditional forms of corporate organization, and how they are changing traditional ways of managing that organization.” Um, no.

What Uber and Airbnb are “textbook examples” of is what Michel Bauwens of the Foundation for P2P Alternatives calls “netarchical capitalism”:  an intermediate organizational form in which the owners of proprietary platforms use them to extract value from the users. As a friend on Twitter observed the same day the article was written, the capitalists at Uber and Airbnb extract usury from workers’ use of their own physical capital.

In the early 20th century, technological historian Lewis Mumford coined the term “cultural pseudomorph” to describe the cooptation of new, liberatory technologies — technologies which opened the possibility of fundamentally new social and economic relations — into a preexisting, technologically superfluous institutional framework. His example was the central technology of the new neotechnic era — electrically powered machinery — which was ideally suited to a new economic model of relocalized craft production with machinery scaled to the flow of production, production flow scaled to orders, and small manufacturing shops sited near the point of consumption, all on a lean, demand-pull basis. Instead, thanks to an alliance between the capitalist state and the dominant economic players, electrical power was incorporated into mass production, a newer version of the paleotechnic Dark Satanic Mills of the 19th century. Mass production threw away all the efficiency advantages of scaling production to demand at the point of consumption, and instead built a model based on running enormously expensive, large-scale, specialized machinery full speed to produce large batches totally divorced from preexisting demand. This required all the inefficiencies of supply-push, batch-and-queue distribution — the cost of which more than offset the reduced unit costs of production in the factories themselves.

We saw it again in recent years, with attempts by global corporations to outsource actual production to small-scale job shops using cheap CNC machinery — which, again, is best suited to relocalized craft production — but using finance, marketing and ownership of patents and trademarks to retain a monopoly on distribution of the product.

Both these technological revolutions could be coopted into older, corporate institutional forms for a time; but that time is coming to an end with the rise of the open-source hardware, micromanufacturing and peer production movements.

And the Uber/Airbnb “sharing economy” model — another intermediate form that involves putting new wine in old bottles — is likewise unsustainable. In the case of “ride-sharing” services falsely so-called, the sharing economy is ideally suited to genuine p2p organizational forms — horizontal and open-source, owned and self-organized by the actual drivers and/or passengers themselves. Uber and Lyft, despite the fact that new network technologies render the corporate form entirely superfluous, are — just like Nike and Apple and other corporations that don’t actually produce anything any more — attempting to use “intellectual property” (in this case a proprietary, walled-garden app), enforced by their capitalist state, to enclose the new technologies of abundance and extract rent from them.

If you wonder how that’s going to work out for them, just ask the music industry.