Capitalism and Un-Freedom (More on Contract Feudalism)

A bon mot from Lenin's Tomb (via Freiheit und Wissen):

The illusion of a free and equal contract between employee and employer is one that exerts considerable hold, particularly given the paucity of industrial conflict over the last fifteen years. The thought that the situation might be rigged in advance, by virtue of the capitalists control of the means of production, is so obvious that it eludes many people who otherwise place themselves on the Left.

In part, this is because people are prepared from an early age to expect and accept this state of affairs. In high school Business Studies class, I was shown along with my class mates a video sponsored by some bank which purported to demonstrate how the division of labour came about. It all took place, it seemed, in a relatively benign and peaceful fashion, with no intruding political questions or economic phases. From the cavemen to cashcards, it was really all about work being broken down into separate tasks which would be undertaken by those most able to do them. Then, finding contact with nearby villages, they would trade things that they were good at making for the things that the other villages were good at making. David Ricardo chortled from beyond the grave. The only interesting thing about this propaganda video is that it raised not a single eyebrow - as how could it? One is led to expect to work for a capitalist without seeing anything necessarily unjust about it, and one has nothing to compare it to. The worker is taught to sell herself (all those job interview training schemes) without perceiving herself as a commodity.

I had a similar reaction to all those passages on time-preference in Bohm-Bawerk and Mises that just accepted, as a matter of course, that one person was in a position to "contribute" capital to the production process, while another person for some mysterious reason needed the means of production and the labor-fund that were so graciously "provided." The old bourgeois nursery tale of primitive accumulation is still a favorite, although it has been thoroughly discredited by commentators ranging from the statist Marx....

In times long gone-by there were two sorts of people; one, the diligent, intelligent, and, above all, frugal elite; the other, lazy rascals, spending their substance, and more, in riotous living. The legend of theological original sin tells us certainly how man came to be condemned to eat his bread in the sweat of his brow; but the history of economic original sin reveals to us that there are people to whom this is by no means essential. Never mind! Thus it came to pass that the former sort accumulated wealth, and the latter sort had at last nothing to sell except their own skins. And from this original sin dates the poverty of the great majority that, despite all its labour, has up to now nothing to sell but itself, and the wealth of the few that increases constantly although they have long ceased to work.

to the free market socialist Franz Oppenheimer.

According to Adam Smith, the classes in a society are the results of "natural" development. From an original state of equality, these arose from no other cause than the exercise of the economic virtues of industry, frugality and providence. Since these virtues are pre-eminently those of a bourgeois society, the capitalist rule, thus sanctioned by natural law, is just and unassailable. As a corollary to this theorem the claims of Socialism cannot be admitted....

For them, class domination, on this theory, is the result of a gradual differentiation from an original state of general equality and freedom, with no implication in it of any extra-economic power....

This assumed proof is based upon the concept of a "primitive accumulation," or an original store of wealth, in lands and in movable property, brought about by means of purely economic forces; a doctrine justly derided by Karl Marx as a "fairy tale." Its scheme of reasoning approximates this:

Somewhere, in some far-stretching, fertile country, a number of free men, of equal status, form a union for mutual protection. Gradually they differentiate into property classes. Those best endowed with strength, wisdom, capacity for saving, industry and caution, slowly acquire a basic amount of real or movable property; while the stupid and less efficient, and those given to carelessness and waste, remain without possessions. The well-to-do lend their productive property to the less well-off in return for tribute, either ground-rent or profit, and become thereby continually richer, while the others always remain poor. These differences in possession gradually develop social class distinctions; since everywhere the rich have preference, while they alone have the time and the means to devote to public affairs and to turn the laws administered by them to their own advantage. Thus, in time, there develops a ruling and property-owning estate, and a proletariat, a class without property. The primitive state of free and equal fellows becomes a class-state, by an inherent law of development, because in every conceivable mass of men there are, as may readily be seen, strong and weak, clever and foolish, cautious and wasteful ones.

As a free market anti-capitalist, of course, I have to stipulate that there's nothing inherently wrong with wage labor. There's nothing inherently wrong with someone owning means of production, and hiring the labor of another to work them--if (and it's a big if) there was no coercion involved in acquiring the means of production, and no coercion is involved in the terms under which the worker must sell his labor. Under such circumstances, the owner's means of production are simply his own crystallized labor, and his returns from ownership are nothing but the cost of amortizing that labor. The natural wage of labor, under such circumstances, is its full product. And all exchanges are exchanges of labor. After all, as Benjamin Tucker put it, the whole point of socialism, rightfully speaking, is that labor should be paid its full product--not that being paid is a bad thing.

[Johann] Most being a Communist, he must, to be consistent, object to the purchase or sale of anything whatever; but why he should particularly object to the purchase and sale of labor is more than I can understand. Really, in the last analysis, labor is the only thing that has any title to be bought or sold. Is there any just basis of price except cost? And is there anything that costs except labor or suffering (another name for labor)? Labor should be paid! Horrible, isn't it? Why, I thought the fact that is not paid was the whole grievance. "Unpaid labor" has been the chief complaint of all Socialists, and that labor should get its reward has been their chief contention. Suppose I had said to Kropotkin that the real question is whether Communism will permit individuals to exchange their labor or products on their own terms. Would then Most have been as shocked? ....Yet in another form I said precisely that.

Now these principles would be a great guide to practice, if we lived in a free market society that had evolved peacefully from the society of the High Middle Ages, based on free exchange between peasant proprietors living on their own land and self-governing tradesmen in the town communes.

As it is, however, the means of production, during the centuries of the capitalist epoch, have been concentrated in a few hands by one of the greatest robberies in human history. The peasants of Europe were driven off the land by state-approved robbery, and driven into the factories like cattle. Their movements during the early industrial era were restricted by what amounted to an internal passport system, and their bargaining power in the labor market restricted by draconian Combination Laws enforced by administrative fiat. And even in the so-called "free market" that ensued, owners of capital and land were able to exact tribute from labor, thanks to state policies that restricted workers' access to cheap, self-organized capital, and forced them to sell their labor in a buyer's market. So the worker has been robbed doubly: by the state's initial use of force to forestall a producer-owned market economy; and by the state's ongoing intervention that forces him to sell his labor for less than his product. The vast majority of accumulated capital today is the result, not of the capitalist's past labor and abstention, but of robbery.