Vulgar Libertarianism Watch, Part 1
So I've decided to go with the original impulse, and regularly feature "Vulgar Libertarianism Watch" without making it the main focus of the blog. And what better way to kick things off than with the first installment of this feature?
First, a note on what vulgar libertarianism is. The term, coined as far as I know by yours truly, alludes both to the "vulgar Marxism" of twentieth century Marxoids, and to what Marx called the "vulgar political economy" of the generation after Ricardo and Mill. The defining feature of vulgar political economy, as Marx described it, was that it had ceased to be an attempt at the scientific explication of the laws of economics, and had become a hired prize-fighter on behalf of plutocratic interests. Classical political economy was a revolutionary creed that threatened the interests of the landed oligarchy and the mercantilists. And it was amenable to even more revolutionary uses, as evidenced by the Ricardian socialists. The most famous socialist treatment of Ricardo, of course, is that of Marx. But the socialist development of classical political economy also included free marketers like Thomas Hodgskin (the most preeminent of Ricardian socialists), the mutualist and individualist anarchists from Warren to Tucker and Spooner, and many Georgists. My own work falls within this latter array of petty bourgeois deviationationists. But with the triumph of the industrial owning classes in 1830s Britain, the focus of political economy shifted from scientific investigation and a radical challenge to the power of the Old Regime, to an apology for the status quo.
I described vulgar libertarianism as an ideology in the opening section of Chapter Four of my Studies in Mutualist Political Economy. Since that passage is as coherent a description as I am likely to write, rather than reinvent the wheel I'll just take the lazy man's way out and paste in the relevant paragraphs:
This school of libertarianism has inscribed on its banner the reactionary watchword: "Them pore ole bosses need all the help they can get." For every imaginable policy issue, the good guys and bad guys can be predicted with ease, by simply inverting the slogan of Animal Farm: "Two legs good, four legs baaaad." In every case, the good guys, the sacrificial victims of the Progressive State, are the rich and powerful. The bad guys are the consumer and the worker, acting to enrich themselves from the public treasury. As one of the most egregious examples of this tendency, consider Ayn Rand's characterization of big business as an "oppressed minority," and of the Military-Industrial Complex as a "myth or worse."
The ideal "free market" society of such people, it seems, is simply actually existing capitalism, minus the regulatory and welfare state: a hyper-thyroidal version of nineteenth century robber baron capitalism, perhaps; or better yet, a society "reformed" by the likes of Pinochet, the Dionysius to whom Milton Friedman and the Chicago Boys played Aristotle.
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 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."
In "That Taco Bell Brouhaha," Art Carden addresses the boycott (by the Wobblies, various student anti-sweatshop coalitions, and others) of Taco Bell on behalf of the Immolakee Indians who pick its tomatoes. In response to charges that Taco Bell's wages are exploitative, Carden responds:
This is precisely wrong. Taco Bell's wage policy alleviates the "continued misery of farmworkers and their families" rather than contributing to it. Wages are not foisted upon workers; they agree to pick tomatoes for "sub-poverty wages" for a reason. In a market economy, they do so because the 'sub-poverty wages" paid by Taco Bell suppliers are a better deal than anyone else is offering. It's the same reason people line up for "sweatshop" jobs in developing countries. Far from contributing to "continued misery," Taco Bell is making workers' lives a little bit better by offering something better than their next-best option.
Before we rush to condemn free markets and market forces, we have to ask where the workers are coming from. In many cases, Taco Bell suppliers employ migrant workers who are making their own "run for the border." Migrant workers in Immokalee come from places like Haiti, Mexico, and Central America—areas where markets have been crippled by state intervention for generations. The end result is a veritable army of workers who have not been allowed to build a skill set through free market employment and who are now suited to do nothing better than pick tomatoes for pennies. Far from being the enemies of labor, American markets are offering migrant workers an opportunity to substantially improve their standards of living and the prospects of their children.
There are so many features of vulgar libertarianism here, it's hard to decide where to begin. The defense of the behavior of big business under "actually existing capitalism" in terms of "how the free market works" is, as I already pointed out in the passage above from Mutualist Political Economy, an immediate tipoff that we've encountered a vulgar libertarian.
It's quite jarring, though, to encounter such writing at the website of an institution so closely associated with the memory of Murray Rothbard. A central theme of Rothbard's work, and that of left-Rothbardians like Joseph Stromberg, has been the essentially statist (and exploitative) nature of corporate capitalism in its existing form. As Rothbard put it in "The Student Revolution" (The Libertarian, May 1, 1969), "our corporate state uses the coercive taxing power either to accumulate corporate capital or to lower corporate costs." So to pass from reading an excellent piece of free market analysis like this or this, to reading an apology for the status quo like the piece under consideration here, is positively obscene.
Especially typical of the vulgar libertarian style is the argument that Taco Bell offers a "better deal" than the "next-best option." This argument can be found, phrased in slightly different words, in pseudo-"free market" boilerplate in just about any issue of The Freeman: Ideas on Liberty or any daily installment of the Adam Smith Institute blog. Here are several almost identical examples culled from The Freeman:
But are the “low-wage, non-union” Ecuadorian laborers better off working now for some foreign corporation? Apparently they think so, or else they would have stayed with what they were doing previously. (Would you leave your job for one with less pay and worse conditions?) [Barry Loberfeld. "A Race to the Bottom" (July 2001)]
People line up in China and Indonesia and Malaysia when American multinationals open a factory. And that is because even though the wages are low by American standards, the jobs created by those American firms are often some of the best jobs in those economies. [Russell Roberts. "The Pursuit of Happiness: Does Trade Exploit the Poorest of the Poor?" (September 2001)]
What the Industrial Revolution made possible, then, was for these people, who had nothing else to offer to the market, to be able to sell their labor to capitalists in exchange for wages. That is why they were able to survive at all.... As Mises argues, the very fact that people took factory jobs in the first place indicates that these jobs, however distasteful to us, represented the best opportunity they had. [Thomas E. Woods, Jr. "A Myth Shattered: Mises, Hayek, and the Industrial Revolution" (November 2001)]
In nineteenth-century America, anti-sweatshop activism was focused on domestic manufacturing facilities that employed poor immigrant men, women, and children. Although conditions were horrendous, they provided a means for many of the country's least-skilled people to earn livings. Typically, those who worked there did so because it was their best opportunity, given the choices available....
It is true that the wages earned by workers in developing nations are outrageously low compared to American wages, and their working conditions go counter to sensibilities in the rich, industrialized West. However, I have seen how the foreign-based opportunities are normally better than the local alternatives in case after case, from Central America to Southeast Asia. [Stephan Spath, "The Virtues of Sweatshops" (March 2002)]
More recently, the argument was reincarnated by Radley Balko, who referred to Third World sweatshops as "the best of a series of bad employment options available" to laborers there. Within a couple of days, this piece was recirculated over the "free market" [sic] blogosphere, along with numerous comments that "sweatshops are far superior to third-world workers' next best options...," or to similar effect (the last phrase comes from another article by Carden posted on the Mises blog last May, by the way). For more examples of the same argument, just Google "sweatshops"+"next-best alternative".
But the grand-daddy of this argument was Ludwig von Mises, writing in Human Action:
The factory owners did not have the power to compel anybody to take a factory job. They could only hire people who were ready to work for the wages offered to them. Low as these wage rates were, they were nonetheless much more than these paupers could earn in any other field open to them. [Regnery Third Revised Edition, 619-20]
In the world the rest of us non-vulgar libertoids inhabit, of course, things are a little less rosy. There was a great deal of continuity between the Whig landed aristocracy that carried out the enclosures and other abrogations of traditional rights to the land, and the employing classes of early industrial Britain. The early industrialists of Manchester, far from being (as Mises portrayed them) an upstart class who accumulated capital through their own parsimony, were junior partners of the landed oligarchy; the latter were a major source of investment capital. And the factory owners benefited, in addition, from near-totalitarian social controls on the movement and free association of labor; this legal regime included the Combination Acts, the Riot Act, and the law of Settlements (the latter amounting to an internal passport system).
In addition, the general legal framework (as Benjamin Tucker described it) restricted labor's access to its own capital through such forms of self-organization as mutual banks. As a result of this "money monopoly," workers were forced to sell their labor in a buyer's market on terms set by the owning classes, and thus pay tribute (in the form of a wage less than their labor-product) for access to the means of production.
Lysander Spooner, a hero to many anarcho-capitalists, in Natural Law described the process in somewhat less than capitalistic language:
In process of time, the robber, or slaveholding, class---who had seized all the lands, and held all the means of creating wealth---began to discover that the easiest mode of managing their slaves, and making them profitable, was not for each slaveholder to hold his specified number of slaves, as he had done before, and as he would hold so many cattle, but to give them so much liberty as would throw upon themselves (the slaves) the responsibility of their own subsistence, and yet compel them to sell their labor to the land-holding class---their former owners---for just what the latter might choose to give them. Of course, these liberated slaves, as some have erroneously called them, having no lands, or other property, and no means of obtaining an independent subsistence, had no alternative---to save themselves from starvation---but to sell their labor to the landholders, in exchange only for the coarsest necessaries of life; not always for so much even as that.
These liberated slaves, as they were called, were now scarcely less slaves than they were before. Their means of subsistence were perhaps even more precarious than when each had his own owner, who had an interest to preserve his life. They were liable, at the caprice or interest of the landholders, to be thrown out of home, employment, and the opportunity of even earning a subsistence by their labor. They were, therefore, in large numbers, driven to the necessity of begging, stealing, or starving; and became, of course, dangerous to the property and quiet of their late masters.
The consequence was, that these late owners found it necessary, for their own safety and the safety of their property, to organize themselves more perfectly as a government and make laws for keeping these dangerous people in subjection; that is, laws fixing the prices at which they should be compelled to labor, and also prescribing fearful punishments, even death itself, for such thefts and tresspasses as they were driven to commit, as their only means of saving themselves from starvation.