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Mutualist Blog: Free Market Anti-Capitalism

To dissolve, submerge, and cause to disappear the political or governmental system in the economic system by reducing, simplifying, decentralizing and suppressing, one after another, all the wheels of this great machine, which is called the Government or the State. --Proudhon, General Idea of the Revolution

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Location: Northwest Arkansas, United States

Monday, July 31, 2006

Guest Posting at Panchromatica

Ian Bertram of Panchromatica is on a posting hiatus while moving house, and has invited some guest posters to help fill in the gap. The ongoing theme is urban planning issues. Today I'm the guest poster, with this one: "A Free Market View of Urban Planning." Check it out.

And while you're over there, bookmark the site for the high level of commentary that appears there the rest of the time.

Emma Goldman Finishing School

Via Roger on Anarchy List. Seattle Weekly has an article on the Emma Goldman Finishing School intentional community:

"Sasha Berkman," the founder, describes the idea behind it:

The theory is: Revolution is not the moment that you seize power. The revolution is the building of day-to-day alternative systems and structures.

Unlike most intentional communities, which are rural, Emma's is an urban commune situated close to the headquarters of Amazon.Com.

If you live at Emma's, you do not have to work at a paying job, but you can't spend more than $15,000 a year, no matter how much you earn. You cannot own a car, but for four hours of labor a week, you can join Emma's car co-op with three vehicles, all equally decrepit. There are home-cooked vegetarian meals most nights, though you have to be willing to eat food partially harvested from Dumpsters (somewhere between 10 percent and 20 percent of the community's food is scavenged). Illegal drugs aren't allowed, but the commune home brews its own beer. All decisions are made by consensus. Every week there is a three-hour house meeting where all the final decisions for the commune are made. You can't be lazy and live at Emma's, and it helps if you have a good sense of humor. Emma's members are white, middle-class, college-educated, dedicated nonviolent revolutionaries, currently between the ages of 23 and 40, trying to concretely realize their utopian vision in the middle of a dystopian world of war, famine, disease, and ecological devastation. Berkman explains what they are doing by quoting an old anarchist adage: We are building the new society in the shell of the old....

Emma's has adopted a modified form of income sharing called labor sharing. The fundamental principle is that an hour of anyone's time is equal to an hour of anyone else's time. In the community, and in the world its members envision, an hour that Cooper spends as executive director of a nonprofit is equal to the hour that Berkman spends taking garbage out of a Dumpster. As Cooper [director of the land trust that bought the abandoned apartment building that houses the commune] wrote, "Sharing income, resources, and property is a direct affront to our capitalistic ideology of the individual, and thus is a scary idea to entertain."

I disagree. An hour-for-hour labor exchange is the height of individualism. By acknowledging that labor is worthy of its hire, that nobody has the right to command the goods or services of another producer except through a voluntary exchange of value for value, the labor exchange honors the sovereign, equal individual.

Currently, each of Emma's members owes the community 118 hours a month. Those can be worked entirely inside the house—at the moment, two members have chosen that option—or nearly entirely outside the house at a paying job. The exception is that everyone must help clean the common areas.

People who receive income from paying jobs turn over all of their wages to the commune. In exchange for their income and household labor, members receive food, shelter, health insurance, transportation (bus passes and car co-op), a modest retirement savings, and educational expenses, including payments on student loans. Members also receive a small personal allowance, currently maxed out at $417 a month, for clothing, entertainment, hobbies, and the like. The living expenses for each member add up to around $15,000 annually, which puts them in the lowest 10 percent of income for individuals in Seattle. For Emma's members, their voluntary poverty is a living critique of capitalist consumerism.

Any money that the community receives over and above expenses and allowances is loaned to a "social justice fund" (members who leave are reimbursed over time for their financial contributions). Currently at around $100,000, the fund is part of the group's plans to help like-minded people start revolutionary projects in Seattle. "We have a distinctly expansionist strategy," says Parke Burgess, 40, a member for the last three and a half years. Burgess explains that Emma's members hope to help jump-start dozens of residential communities and worker-run collectives in the area. "Hopefully, there will be a meat-eating commune or one where they all smoke cigarettes. Our hope is to create a microcosm of Seattle in these many communities. They could be residential or a food distribution system or a zero-interest bank or risk pools instead of conventional insurance. That's a huge focus of our hope and dreams for this institution."

This sounds a bit like Mark Gillespie's idea in an article for Strike the Root:

Now, while these ICs are growing, each new community will be working to spawn others. I don't care if the community is one of rabid Christian post-millenialists or if they are the most homo of homosexuals. Start helping others to design their own communities. A smart group of an-caps could actually make this a business model. Soon a federation of radically differing communities will be in full agreement on mutual protection and mutual growth.

Sunday, July 30, 2006

Nock: The Criminal Exploiter State

Via Adam Ricketson on Eternal Vigilance. A killer quoe from Albert Nock, on the criminality of the state and its central purpose of class exploitation. From "The Criminality of the State," America Mercury Magazine, March 1939

[T]he State's criminality is nothing new and nothing to be wondered at. It began when the first predatory group of men clustered together and formed the State, and it will continue as long as the State exists in the world, because the State is fundamentally an anti-social institution, fundamentally criminal. The idea that the State originated to serve any kind of social purpose is completely unhistorical. It originated in conquest and confiscation -- that is to say, in crime. It originated for the purpose of maintaining the division of society into an owning-and-exploiting class and a propertyless dependent class -- that is, for a criminal purpose. No State known to history originated in any other manner, or for any other purpose. Like all predatory or parasitic institutions, its first instinct is that of self-preservation. All its enterprises are directed first towards preserving its own life, and, second, towards increasing its own power and enlarging the scope of its own activity. For the sake of this it will, and regularly does, commit any crime which circumstances make expedient.

Cooperative Sector in Uruguay

Alan Avans at Ecodema has an interesting post (with a lot of good links) on cooperatives in Uruguay, which has "probably the heaviest concentration of cooperatives of all kinds relative to its population..."

Saturday, July 29, 2006

Keep Taxpayer Dollars Out of Bill Gates' Pocket

Believe it or not, the Adam Smith Institute blog sometimes provides something besides fodder for negative posts. When it does, there's a pretty good chance Alex Singleton is the author. In "Should UK education be switching to OpenOffice?" Singleton argues that open source software would reduce computer costs by half in primary schools and by a quarter in secondary schools.

Of course, since "public" schools are spending (in Milton Friedman's phrase) other people's money on other people, they've got no real reason to want to save money. When the neighboring city of Siloam Springs voted down a millage increase for schools, the school administration announced shortly afterward that it was cancelling its planned purchase of new computers. Instead, it would upgrade existing computers at far less cost, with almost the same increase in performance. Well, well, well! If they hadn't had their money fix cut off, they wouldn't have even considered doing something that cost-effective.

Friday, July 28, 2006

Nuclear Power and the State

Sean Gabb of the Libertarian Alliance asks

whether, in a world without government, there would be many nuclear power stations.

His answer:

I do not think there would be many nuclear power stations in a world without government. Bearing in mind their actual—or just their suspected - dangers, the common law tort of nuisance would prevent any from being built in England. Would you be happy if one were built within 20 miles of your home? Would you knowingly buy property within that sort of radius? I would not—nor would even if they came with safeguards costing ten times what is now spent.

I say, therefore, that nuclear power can only be generated in a territory without much population, and elsewhere only when an enlarged government is able to sweep aside individual complaints and to indemnify the relevant big business interests with legal privilege or financial subsidy.

I would add that virtually every link in the production chain for nuclear power is heavily subsidized by the state, starting with research and development that are are almost entirely state-funded. The actual physical process is likewise subsidized, from the building of roads to the uranium mines on government land, to the disposal of waste. And of course, the above-mentioned subsidy and/or indemnification of liability costs.

The Corporate State: Libertarian Enemy Number One

Hat tip to Keith Preston. "What Is the Enemy?" by Sheldon Richman:

...the great threat to liberty is the corporate state, otherwise known as corporatism, state capitalism, and political capitalism....

Libertarianism is radical not conservative, and laissez faire protects no vested interests. Libertarians once were highly sensitive to this point. The great 19th-century champions of the market, such as Benjamin Tucker and the contributors to his Liberty magazine, thought of themselves as “free-market socialists” because they wanted no part of “capitalism,” which they viewed as the historical system in which government intervenes in behalf of capital and to the detriment of common workers. The word still denotes that for many, perhaps most, people....

On the international stage, this danger is writ large. The United States is assumed to favor free markets (“capitalism”), so when it meddles in other countries, supports dictators, and encourages (or imposes) interventionist economic measures, that is seen as consistent with the free-market philosophy. Resentment against those policies becomes resentment against the free market. This has done untold damage to the libertarian cause where it should have flourished. If capitalism means feudalism (stealing land from peasants), virtually forced labor in factories and mines, and wholesale violations of civil liberties (including torture), who would want any part of it?

Similarly, if capitalism at home means a system rigged in favor of cartelized industries and a nearly prohibitive regulatory/tax morass for small and would-be competitors, who needs it?

In other words, U.S. policy for years has made anti-capitalism appealing to millions of people at home and abroad by associating capitalism with corporatism and imperialism. These people should be libertarians.

And some "libertarians" have made anti-capitalism appealing to millions by associating capitalism with corporatism and imperialism. For example: ASI agitprop like the piece linked in my previous post, which is conservative and does protect vested interests.

Thursday, July 27, 2006

Vulgar Libertarianism Watch, Part XVIII

Via Tim Hilton at the Globalisation Institute blog. An absolutely awful article by--who else--Madsen Pirie of the Adam Smith Institute: "Big business — it's mankind's biggest boon."

The article attempts a sleight of hand, jumping back and forth from a defense of "business" and voluntary exchange in general, and a critique of the zero-sum assumptions of collectivists, to a defense of the giant corporation--for the most part the creature of the state's zero-sum intervention in the economy.

It is all very well for film-makers and NGO zealots to sneer at business, but it is businesses that bring the food to their tables and make the drugs available when they are sick. It is the large corporations that add cultural richness to our lives by enabling, say, a recording of folk-singers from Mali to be downloaded on to an iPod in Sydney. It is big business that liberates people to widen their horizons by jumping on a jumbo jet to a far-flung part of the world. It is the large corporations that have diminished domestic drudgery by providing vacuum cleaners, microwaves and refrigerators. For that matter, it is large corporations that help to finance, produce, distribute and market anti-corporation movies, watched on TV screens or cut on to DVDs made by big businesses.

Whether these things are currently done by large corporations is beside the point. An apologist for the old state-owned and -planned economy in the USSR might just as easily have said, "it is state industry that brings you your food and medicine." The proper question is whether the large corporation is necessary to provide them, and whether it acts in collusion with the state to crowd out other ways of providing them.

Most of Pirie's choices of examples are unfortunate, not to say comical, from the standpoint of his "free market" rhetoric. Consider, for example, the origins of the jumbo jet in the Cold War military-industrial complex. The aircraft industry was spiralling into the red after WWII, until Truman's heavy bomber program breathed life into it. The jumbo jet itself would have been impossible without taxpayer-funded heavy bombers, because the production runs for jumbo jets alone were too short to pay for the expensive machine tools required to build them. The aircraft industry is the most state-dependent welfare bum of any industry in America--well, except perhaps the drug industry, another one of Pirie's examples. Consider, again, the extent of government funding of drug research, the government's patent system, and the government's reimportation bans. A major part of the development costs that patents were supposedly intended to recoup are actually the costs of gaming the patent system: developing "me, too" versions of drugs about to go off-patent, or establishing patent lock-down on alternative forms of a drug. The entertainment industry is also an unfortunate choice for an example, given the RIAA and MPAA lips firmly clamped around the nipples of Congress.

And I wonder why Pirie puts so much emphasis on "large corporations." Most consumer goods like microwaves, vacuum cleaners and refrigerators could be made more efficiently by smaller factories producing for local markets. The problem is that the state subsidizes so many of the inefficiency costs of large size, and so restrains competition, that inefficiency doesn't carry the competitive disadvantages it would in a free market.

The constant reference to large corporations, and not just to business as such, gives away Pirie's real agenda. This little puff piece was designed, not to defend business as such, but as propaganda on behalf of some of the most powerful institutions in the world. Anyone with the gall to use language about "the spontaneous nature of economic activity, and the free trade and choices that it brings" in a defense of the state capitalist corporation (that includes the aircraft, drug and entertainment industries, no less) is a master of disingenuity. But it's no surprise, coming from the ASI. The ASI's mission is to defend, not the principles of the free market as such, but the interests of the large corporation. The "free market" language is just protective coloring.

More Howlers from Reisman

George Reisman was interviewed on his article "Mutualism: A Philosophy for Thieves" on FMNN eRadio with John St. George ("Chemical Ali" Massoud tipped me off to this). The website's blurb about the interview has the campy feel of Reefer Madness, or a 1950s FBI propaganda film on "International Communism": "THE MUTUALIST: Ever lurking, ever searching to simply 'squat' and take your land. Is this the next step from Eminent Domain?"

Of course, Reisman gives mutualist property rights theory the same clueless overall treatment as he did in "Mutualism's Support for Exploitation of Labor and State Coercion." His hypothetical scenarios all involve, not mutualism as a coherent set of property rules enforced by majority social consensus in a locality, but as the private philosophy of some individual con artist attempting to scam an unsuspecting landlord in a Lockean society. And the need for mutualist owner-occupiers to appeal to the consensus of their neighbors for enforcement of their property rights is characterized as dependence on a state or "band of thugs" for enforcement--even at the same time Reisman shows Lockeans enforcing their property rights by the very same sort of appeal to their neighbors. I've already dealt with his ham-handed treatment, at length (see the synopsis of links to the debate at the bottom of this post).

But here are some more howlers you might enjoy:

Q. Does mutualism have its roots in socialism or communism?

A. I'd say it's about eighty percent Marxism. It accepts Marx's theory of how wages and profits are determined. See, Marx claimed that profit income is stolen from the workers, that property... that workers should have all the income that results. They are the producers, allegedly, and the businessmen aren't.

This is the level of knowledge of nineteenth century political philosophy I'd expect from a B- student in an undergrad Western Civ class. It would be a lot more accurate to say that the entire socialist movement, including Marx, Proudhon, and free market radicals like Hodgskin and the American individualists, all accepted the radical Ricardian theory of how wages and profits were determined.

The mutualists say you don't need socialism, the problem [of profits] would be addressed if the government... didn't do anything that stood in the way of banks being formed that would create a flood of new and additional money that would drive interest rates down close to zero. The mutualists think that expanding the quantity of money can permanently reduce the rate of interest and then indirectly the rate of profit pretty close to zero, and they think the only reason that this doesn't happen is the government is restricting the ability of the banking system to create money.

OK, breathe deeply now. Take a look at this passage from my rejoinder article, made directly in response to the sort of misreading Reisman makes above:

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.

Now, as I see it, there are only three possibilities: 1) Reisman just goes on repeating his assertion without ever having bothered to read my response to it; 2) he read my response but is unable to understand how it contradicts what he wrote; or 3) he's deliberately persisting in a conscious mischaracterization. So he's either lazy, lacking in reading comprehension, or a liar. I'd really prefer to believe #1 or #2 because, despite all my online wrangling with him, he doesn't seem like a bad guy--more clueless than malicious.

But for crying out loud, before you criticize something, make sure you've got a clue about what you're criticizing! I've been criticized by Lockeans who actually understand my position (see Roderick Long's review article in JLS), and believe me, they're a lot more effective than Reisman. It takes a lot less work for me to make fun of a critic who comes up with howlers like these, than to put the effort into answering effective criticisms by someone who understands what he's criticizing. And some people who never heard of mutualism before they saw Reisman's article have followed the trackbacks to my responses, compared what I actually said to his clownish mischaracterizations of it, and wound up thinking the worse of him. Frequent commenter quasibill, who still disagrees with me on the nature of property rights, learned in that very way never to trust Reisman's account of anything. I'm just afraid people will suspect I'm paying Reisman to write this stuff. He's certainly not doing himself any favors.

I feel like I've lifted up a rock and seen what's crawling under it.

My immediate reaction was to say "likewise"; but I thought better of it, because I don't really see Reisman that way. More than anything, I'm a little taken aback by his utter revulsion, his delenda est, root-and-branch attitude. It's as though he just suddenly discovered the broad segment of free market libertarian thought in this country that has taken a radical view of land. He's not only writing off me (big deal) and Warren and Tucker; he's writing off Henry George, Bolton Hall, Oppenheimer, Nock, Frank Chodorov, Spencer Heath, etc., etc. It's not just that he disagrees with me on the nature of property rights in land (that's entirely legitimate), it's that he's entirely incapable of seeing the Lockean and other more radical strands of classical liberalism as common members of a larger category. There have been plenty of radical Lockeans in the Rothbardian camp (including Rothbard himself) who've seen these "land cranks" as fellow travellers (if misguided ones) in the free market movement, and appreciated their contributions in areas where they agreed. Reisman, on the other hand, really does act like he's turned a rock over. But I don't see how a "professor emeritus" who's a prominent libertarian figure can be so abysmally ignorant about the history of his own movement.

Here, by the way, is a synopsis of my exchanges with Reisman so far:

Reisman. "Mutualism: A Philosophy for Thieves"
Carson. "There He Goes Again!"
Reisman. "Mutualism's Support for the Exploitation of Labor and State Coercion"
Carson. "George Reisman's Double Standard"

Read them for yourself and decide whether Reisman gives a fair account of my position.

Wednesday, July 26, 2006

Biomimetics Technologies

I recently filled a book order for Meir Israelowitz, who lives in Hannover. He told me a lot of interesting things about the outfit he works with, Biomimetics Technologies.

The company came out of research work done at Carnegie Mellon from 1997 to 2003, attempting to mimic natural processes. The idea was to create technologies based on biological processes like tissue growth. It's now a company affiliated with the University of Toronto and based in that city. It is, however, distributed geographically with some work being done in Germany and France.

Biomimetics' core staff of nine includes a mix of engineers, mathematicians, and people in the physical and biological sciences. They have, among other things, developed a microchip that mimics the insect melanophila acumainata's ability to detect fires from 50km.

Interestingly, they're organized as a cooperative and their work unit is affiliated with the I.W.W.

Big Business's Role in Creating Interstate Highway System

A couple of commenters on yesterday's Wal-Mart post, Adam Ricketson and quasibill, raised valid questions about the moral culpability of big business in taking advantage of available externalities. There's a difference, they rightly said, between taking advantage of a situation that exists anyway (hey, I go to the Post Office, after all), and collusion in creating the situation. The distinction is entirely correct.

Now, obviously, Wal-Mart couldn't have had a role in the initial creation of the Interstate Highway System, since it didn't exist until the early sixties. (I know from personal experience that they play a much more active role, at least at the local level, in lobbying for highway and airport pork).

But some of the biggest corporate apologists at the Mises Blog thread I linked to went a lot further, and asserted that big business was always an entirely passive beneficiary in all circumstances, and that the state alone--narrowly defined--could be blamed for creating subsidies. Even when a corporation is holding the bag and collecting the loot, only the guy actually holding the gun can be blamed for the stickup.

In the same comment thread, Sheldon Richman blasted me with this bit of utterly mind-roasting information which had somehow escaped me so far:

Kevin, for what it's worth, the secretary of defense during the initial construction of the interstate highway system, which was justified as a cold-war defense measure, was Charles Wilson, former chief of GM, the guy who said that what's good for GM is good for the country and vice versa.

Shazam!! Well, that's a smoking gun, if I ever saw one.

Just to avoid the off chance of embarrassment from sloppy fact-checking, I did a bit of web searching. Googling "Charles Wilson" and "Interstate," I quickly found an excellent Counterpunch article by Mike Ferner. I quote:

The "most powerful pressure group in Washington," began in June, 1932, when GM President, Alfred P. Sloan, created the National Highway Users Conference, inviting oil and rubber firms to help GM bankroll a propaganda and lobbying effort that continues to this day....

In 1953, President Eisenhower appointed then-GM President Charles Wilson as his Secretary of Defense, who pushed relentlessly for a system of interstate highways. Francis DuPont, whose family owned the largest share of GM stock, was appointed chief administrator of federal highways....

Helping to keep the driving spirit alive, Dow Chemical, producer of asphalt, entered the PR campaign with a film featuring a staged testimonial from a grade school teacher standing up to her anti-highway neighbors with quiet indignation. "Can't you see this highway means a whole new way of life for the children?"

Actually, I think the system of federally designated state highways started all the way back in the 1920s, and I don't know what lobbying efforts went into that (although I've sure as hell got some good ideas). But 1932 is still a pretty long lineage for the automobile-highway complex, dontcha think?

So much for all the hand-wringing big business bukakkists over at Mises Blog, whining that them pore ol' corporations just couldn't help using the Interstates that that mean ol' government created, but that they (John Galts, every one) would probably have built themselves an even better Interstate all by themselves, with their own money, if it wasn't for the baaaad ol' government with it's nasty ol' gun pointed at their heads. Horseshit. Complete and utter horseshit.

Excellent Summary of Cost Externalization

At Social Memory Complex:

Markets are fair only to the extent that liability is conserved inside every activity. People act responsibly because there are consequences for irresponsibility. Adam Smith pointed out the productive power of markets when he said, “It is not the benevolence of the butcher, the brewer, or the baker, that we expect our dinner, but from their regard to their own interest.” In the same sense, we don’t rely on their benevolence to protect us from the harms they might visit on us through corner-cutting, pollution, etc.

If we start unbalancing the picture by taking away the need for some actors to fully account for the costs of their actions, it’s not hard to see that you’ve provided an incentive for them to rack up costs - benevolent though they may seem. There is a vast array of “intangible” interests that the market moderates - but it can only effectively account for them if they are actually worked into the decision making process of economic actors. The market makes these intangible interests tangible through the calculation of costs in the production of goods and services.

Of course, these costs - intangible as they may be - don’t disappear from reality just because they don’t go on the corporate ledger. Rather, the costs are simply shifted to another party - usually, the public. So think about it: first, you socialize the costs by legal fiat, and try to distract people from the root of the decision making process that creates them. Then, when these intangible effects that are supposedly so hard to quantify percolate into the tangibility of affecting actual humans and their lives, it’s left to the environmentally and socially conscious among us to try and refashion these intangible effects into terms movers and shakers - you know, politicians, lobbyists, corporate big-wigs - can understand. And yet, it’s the left who’s accused of having no economic sense!...

Truly productive enterprises don’t need gimmicks to function.... If investors had never had a blanket grant of immunity from fully calculating their true costs, how much cleaner or balanced would industry be? Would we have these huge inequalities of wealth if large scale capitalization didn’t get a sweetheart deal? Would we have more competitive sectors of industry if everybody had to compete, not just on the price of their widget, but the full risks of producing that widget - including dumping waste, emissions, etc.? We’ll never know....

Smarter Critics of Environmentalism, Please

or, Ad Hominems Against the Ad Hominizers; or, People who Use Ad Hominems are Nazis, Unless It's Us.

In a comment thread about one of George Reisman's anti-mutualist posts, Shawn Wilbur remarked:

The section on environmentalism [in Capitalism] is probably the worst in terms of its mean-spiritedness, its tendency to lump [together] radically different tendencies, it's failures to back up broad claims with adequate evidence, etc.

That's borne out in spades, not only in regard to Reisman himself but many of his fellow travellers as well, in a post at Mises Blog. Reisman's remarks on "environmentalists" remind me of nothing so much as an 80-year-old Bircher in high-water pants and a bolo tie, sitting in front of the American Legion post and haranguing everyone in earshot about the "Innernashunnul Commonists."

Reisman, in the main article, denounces "environmentalists" for their resort to ad hominems.

One of the very first replies to my posting of CO2 Science’s journal review "A 221-Year Temperature History of the Southwest Coast of Greenland" was this: "’CO2 Science’ is funded by Exxon. Come on, you guys are usually such independent thinkers—you can do better than rehash this stuff.”

The author of this statement believes that it is sufficient to name the economic affiliation of an individual or organization to be able to dismiss and ignore anything that comes from them. This was a tactic employed for generations by the Marxists. Instead of refuting the criticisms leveled against their doctrines by economists and others, they were content to identify critics as a member of the capitalist class or as having received financial support from capitalists. The Nazis had their own variant of the practice. They were content to identify their critics as Jewish or as somehow supported by Jews or otherwise affiliated with Jews....

In the United States, we are fortunate to have both a long-standing tradition and clear Constitutional protection of a defendant’s right in a criminal trial not to testify. What the Marxists and Nazis and those who are following in their path today are seeking is the equivalent of a prohibition of a defendant’s right to testify.

Individuals, corporations, industries, are to be subject to attack by those who seek to injure or destroy them, and they are to be prohibited from defending themselves by virtue of people being unwilling listen to what they have to say. They are not to be listened to for no other reason than that their avoidance of injury and their survival matters to them. They have an “interest” in the outcome. Yes, they do. And they have a right to be heard—for that very reason! Because their best defense is truth.

He also makes this sweeping generalization:

...the environmental movement would like to destroy... the oil industry, along with the coal and atomic power industries, and is using the alleged connection between global warming and CO2 emissions as its main weapon in its attempt to do so.

Several commenters, starting with CMB at the outset of the thread, were unkind enough to point out the frequent appearence of ad hominem attacks on pro-global warming research--right there at Mises Blog! Here's CMB's comment:

What about all those "Marxists" in the last thread who dismissed all the science surrounding global warming on the basis that scientists are a bunch of statists? Don't they deserve a mention too?

FTR, I find it not good that you compare the people in the last thread who voiced doubts about the reliability of "CO2 Science" to Nazis. The likes of Tokyo Tom and I were arguing in good faith and making reasonable points. Yet here you are comparing us to the worst people in the world! In my opinion--and with the greatest of respect--making wild allegations like that is more a hallmark of a totalitarian way of thinking than the kind of reasonable and polite debate we were entering into.

Dan, taking umbrage on Reisman's behalf, wrote:

I believe they mentioned state sponsored studies as self-interested in response to arguments that the exxon study cannot trusted on the basis of its self interested position. Indeed, they framed the argument as "If the Exxon study is not trustworthy on such and such grounds, then the very same grounds can be used to discount government studies." There is nothing wrong with that kind of argument, as its basically a form of reductio.

As for your whining about being compared to Nazis it has nothing to do with gas chambers, so grow up. The Nazis as well as the Marxists indeed were well known for ad hominem type attacks, in which they attacked the source of an argument rather than the argument itself. Professor Reisman could not have made that any clearer.

Despite Dan's lame attempt to pass off the ad hominems as tu quoque arguments, I myself have seen enough right-libertarians reflexively resorting to ad hominems to know it's a fairly common response to any research that appears dangerously "soft" on global warming. Global warming is commonly dismissed as a trojan horse for the regulatory state. As I recounted in a recent post, Reason's Ron Bailey was himself accused of being an environmentalist dupe for expressing a moderate shift in opinion toward the pro-warming position.

Anyway, quasibill showed up for a rejoinder to Dan:

"The Nazis as well as the Marxists indeed were well known for ad hominem type attacks, in which they attacked the source of an argument rather than the argument itself. Professor Reisman could not have made that any clearer."

Apparently by acting like a Nazi or Marxist, and using ad hominem attacks every chance he gets...

Good thing I wasn't drinking coffee. Reading Reisman, I keep thinking the title ought to be My Struggle Against Looters, Moochers, Whim-Worshippers, and Hippies of the Right--and Methodists!

Quasibill also mocked Reisman's hyperbolic treatment of environmentalists' ad hominem attacks on industry-funded research as tantamount to suppressing testimony in one's own defense.

Don R. responded that Reisman's remark just couldn't be hyperbole, because "the lunatic fringe of the envronmental movement does EVERYTHING possible to silence opposition."

Quasibill stuck to his guns on the charge of hyperbole, speculating on the likely reaction of a court to an attorney who produced this howler:

"your honor, you cannot possibly allow the prosecution to cross examine my client, my eyewitness, and my expert witness on their bias, as it would be akin to prohibiting my client from testifying on his own behalf!"

CMB seized on the "lunatic fringe" qualifier in Dan's comment, pointing out that

[t]he discussion is not about the lunatic fringe. It's about a couple of Austrian-friendly posters in the previous thread (myself included) who don't think the man-made global warming theory is necessarily wrong.

But the Kool-Aid drinkers insisted that all environmentalists belonged to "the lunatic fringe of the environmental movement," and that an environmentalist by definition is one who wants to silence its critics, destroy the oil industry through massive government regulation, etc. Sione, for instance, made this remarkably broad assertion:

The Nazis are about collectivism. Environmentalism necessarily treats people under collectivist premise. These two are simply variants of the same old poison.

CMB responded:

that just isn't true. Typing "Free-market environmentalism" into Wikipedia might be a good start.

Sione came back with this bit of sweet reason:

Adding the tag "free market" does not alter the essential attributes of environmentalism one iota. One may as well rename communism, free market communism.

Environmentalism requires the application of coercive force to ensure all people behave in the manner that environmentalists demand. Options to choose alternatives to the environmentalist ideology are forbidden. People are to be treated as a collective entity, not as individuals.

Indeed just another variant of colectivism.

Sione isn't just saying that it's unlikely, based on his assessment of past experience, that someone might seek to further environmentalist goals through free market means like eliminating energy and transportation subsidies. He's saying that it's logically impossible, because environmentalism is coercive by definition. See, a word means exactly what I want it to mean, no more and no less; it's just a question of who is to be the master. There's glory for you.

Even funnier, one especially frothy-mouthed rug chewer (Mark Humphries) let loose with the shotgun blast below, arguing that ad hominems were only bad when used in regard to industry-funded science! When it came from environmentalists, on the other hand, suggestions of bias weren't bad at all. The difference, see, is that the industry research tells the truth, whereas environmentalist claims about global warming are lies. "Research that agrees with me is true, and research that agrees with my enemies is junk science; and whether money biases research depends on whether it's sponsoring the good guys or the bad guys." Just like the Contras were "freedom fighters" instead of "terrorists," because they were disembowelling peasants for the right reasons. Yeah, I know, I know, this guy really is running around loose. Anyway, here it is for your amusement:

Professor Reisman has pointed out indisputable similarities between ad hominum attacks routinely employed by Stalinist thugs and Nazis, and on this website by those who disparage any connection by science to Exxon or Mobil. The response to Reisman's clearly valid observation is to attempt to smear him as a totalitarian and etc. That response reinforces one of Dr. Reisman's points: Green crusaders are much more interested in shouting down their opposition than they are in carefully thinking about evidence and facts.

The global warming crusade is politics masquerading as "science". One indication of this bait and switch tactic is the argument, continually promoted by left-wing Greens, that a "consensus" of climate scientists support this officially sanctioned thesis. Aside from the questionable truth of this claim (more on this below), consensus has nothing to do with the process of identifying evidence, facts, and the logical integrations tbat lead to new scientific breakthroughs. So scientists properly ought not to be concerned with consensus. Consensus is the obsession of politicans maneuvering to impose their will by force on other people.

Reasonable people should be highly skeptical of much of the "science" produced by contemporary state-sanctioned institutions, because those institutions owe their existence to coercion. They are financed with tax dollars, and more and more they tend to be staffed and run by ambitious political types, who know how to massage the system for grants, prestigious awards, budget boosts, and official approval. Authentic scientists devoted to the adventure of discovery and understanding do not fare well in these institutions of Correctness, because the greater their devotion to science, the higher their resistance to compromising truth for political gain. There are many examples from history of the basic contempt for knowlege fostered by and charateristic of command science. As Ayn Rand explained years ago, force and intelligence are logically and fundamentally antagonistic.

In sharp contrast to the deceit that emerges when science is distorted by a regime of coercion, privately funded science, whether by Exxon or some other organziation, has a major stake in establishing the truth. For private funding is voluntary, so both sponsors and scientists have a huge stake in getting results, which in this case means establishing facts. The privately-funded scientists want to establish facts because their reputations and prospects for advancement in science depend on it. Their sponsors want to establish facts, because such is their only effective defense against those who attack them. "Scientists" who embark on a career in tax-funded politically-driven institutions think of themselves as engaged in science, but to the extent that their job security and advancement depend on acceding to political considerations, they are engaged in pretend-science. And these "other" considerations, whether or not they are acknowleged in public, comprise the whole purpose behind the institution that employs them!

Tokyo Tom, a frequent participant in the environmental threads at Mises Blog, got in a good jibe against Reisman:

What Dr. Reisman fails to note is that, at least as far as disussion on this blog goes, the best target of his very valid point - that one should not dismiss an argument through identifying them with a villanous group - would be himself and perhaps one or two other here.

He also quoted from some dangerously environmentalistic-sounding material (by Roy Cordato) that had somehow managed to slip in at Mises.Org and contaminate their precious bodily fluids:

If a pollution problem exists then its solution must be found in either a clearer definition of property rights to the relevant resources or in the stricter enforcement of rights that already exist. This has been the approach taken to environmental problems by nearly all Austrians who have addressed these kinds of issues (see Mises 1998; Rothbard 1982; Lewin 1982; Cordato 1997). This shifts the perspective on pollution from one of "market failure" where the free market is seen as failing to generate an efficient outcome, to legal failure where the market process is prevented from proceeding efficiently because the necessary institutional framework, clearly defined and enforced property rights, is not in place.

Why, that sounds like... like.... (gasp!) free market environmentalism!

There is, in fact, a respectable segment of environmentalist thought arguing that the best way to reduce carbon emissions is to reduce government-created externalities, in the form of subsidized transportation infrastructure, subsidized sprawl, and wars for oil. And even among geolibertarian environmentalists, the recommended approach is to substitute taxes on pollution and resource consumption for current taxes on labor and capital.

But according to Reisman, Sione, et al, anyone who takes these positions is apparently excluded from the environmentalist category (which is apparently a Platonic eidolon), by definition. I knew the Randroids had gone batshit on the nominalist vs. realist thing, but really!

Tuesday, July 25, 2006

Smarter Wal-Mart Defenders, Please!

The Mises Blog linked to another by-the-numbers defense of Wal-Mart, this time by Paul Kirklin. The article was about what you'd expect (he even repeated the "best available alternative" cliche in the comment thread, in response to a discouraging word about sweatshops).

You have to wonder if these things are written on a prefab template:
1. Nobody's forced to shop there;
2. Nobody's forced to work there;
3. Its sweatshop suppliers beat the best available alternative for foreign labor;
4. And you're an ignorant socialist! Neener neener!

What stands out, though, is a great comment by our own frequent commenter, Joshua Holmes (aka Wild Pegasus):


* soaks up hundreds of millions in direct subsidies

* gets millions more in wildly unfair tax breaks

* steals tens, perhaps hundreds of thousands of acres of land through public domain

* buys most of its products in blatantly corporatist China

* gets free access to the interstate highway system

Fuck them and their "free-market" defenders.

So what do you really think, Josh? In response, Mises comments frequenter "Person" repeated a predictable line of argument he has resorted to more than once (and taken a beating every time:

Yep, "foul" everyone who has and uses free access to the interstate highway system. They're obviously criminal and any business success they had obviously wouldn't have happened without the state.

Everyone is a statist. Everyone should be looted for that crime.

Person followed up shortly thereafter with

I have one more question for everyone who likes to play the game of "ooh, look at this one state intervention that appears to help Wal-mart and ignore all the others that hinder it, so obviously Sam Walton would have been incapable of success in business without the state":

If some anti-statist movement was able to achieve some success, would you say, "Obviously, they had an immense subsidy due to their ability to freely travel on the interstate highway system, so any success they can claim must be due to the state." ?

No, no of course you wouldn't. If you made the first claim about Wal-mart, you're probably not mentally capable of maintaining that much consistency in your positions.

Ahem. The argument, I believe, is that a subsidy to a given input disproportionately benefits those firms which make heaviest use of that input. Businesses operating over large market areas, and relying most heavily on long-distance distribution, will benefit disproportionately from the Interstates. Therefore, they constitute a subsidy to economic centralization. Anyone incapable of following that train of thought ought to go easy on the "mental capability" remarks; you know, glass houses and all that.

Yancey Ward also joined in with this argument:

Several commenters have complained that WalMart uses eminent domain. This is not true. WalMart may benefit from its usage, but it is government that actually wields the power.

Holmes attempted to explain why highway subsidies have this effect, and also used Brad Spangler's brilliant gun man/bag man analogy:

Yep, "foul" everyone who has and uses free access to the interstate highway system. They're obviously criminal and any business success they had obviously wouldn't have happened without the state.

They might have had business success, but certainly not on the scale they have it.

Compare the damage done by trucks to the damage done by cars. Trucks cause significantly more damage to highways than cars, for obvious reasons. So, are trucks and trucking companies paying more in taxes due to the damage they cause? No, of course not. This is a subsidy. A free market highway system, if such a creature could even exist, would have to charge trucks much more for access due to the extensive damage they cause.

Several commenters have complained that WalMart uses eminent domain. This is not true. WalMart may benefit from its usage, but it is government that actually wields the power.
So they're just holding the bag while the government holds the gun. Gotcha.
For those unfamiliar with the "holding the bag" reference, here's the original:

...one robber (the literal apparatus of government) keeps you covered with a pistol while the second (representing State-allied corporations) just holds the bag that you have to drop your wristwatch, wallet and car keys in. To say that your interaction with the bagman was a “voluntary transaction” is an absurdity. Such nonsense should be condemned by all libertarians. Both gunman and bagman together are the true State.

...at least to anyone outside of Galt's Gulch, where all the cheekbones are sharp and everyone's above average. Next came quincunx:

A free market highway system, if such a creature could even exist, would have to charge trucks much more for access due to the extensive damage they cause.

Well it did exist sans trucks in the early 1800s (~3500 mi of private roads). Vehicles were charged for their tire width and number of axles.

BTW, toll booths charge for axles even today (at least in my corner of the country).

Unless you have a problem with this example because technically, the state was around - so it might have subsidized someone somewhere which could have effected this in some vague marginal sense.

So the fact that private roads existed before trucks came into existence, and therefore logically could not have charged trucks fees based on the damage they caused, proves that a free market road system's pricing wouldn't have to take trucks' damage into account today when they do exist? Didn't logic like this once cause a computer to explode in an episode of Star Trek?

Person came back with another argument that he's used before--that the recipients of direct government subsidies are net victims of government interference:

[Person]: "They might have had business success, but certainly not on the scale they have it."

Certainly? Certainly? I guess in all your moral indignation, it never once occurred to you that maybe government intervention is more of a hindrance to Wal-mart than a support? Could you for moment just contemplate that possibility? That maybe without government intervention in the transportation system, maybe their methods would have been even more successful? Or maybe the intelligence of Sam Walton maybe, just maybe, wouldn't have entered a blue screen of death if political/market conditions were different, but would have adapted just the same?

[Holmes]: Yes, certainly. As in "There would certainly be no atomic bomb without the state", so "Wal-Mart would certainly not have enjoyed this level of success without the state".

[Person]: If you don't have a meaningful response, please, just concede the point. You're not fooling anybody with a cryptic response. No one thinks you have a deep understanding of the issue you're trying to reveal through subtle comparisons. What they see is a troll who's trying to score some "street cred" with mutualists. Grow up.

Well, surely he can't have any less "street cred" than Person has scored with his faceless Misesian masters, after this pathetic performance. (Now that you've successfully passed the Mises Blog comments hazing challenge, Josh, your promotion papers for thirty-third degree mutualist will be in the mail. I expect to have your initiation ceremony sometime next week.)

[Holmes]: Concede what point? Wal-Mart benefits heavily from state interference on its behalf, making it more successful than it would be. I'm not sure what deeper insight you would like. Or did I defile your Church of the Rich?

[Person]: Did you not read anything I posted, at all? Sure, some interventions "benefit" Wal-mart. Such benefits could also be grossly inferior to what a free market would provide. What's your basis for claiming the free market would not be more conducive to their success through e.g. cheaper provision of such inputs?

....Yet all you can do is isolate one "benefit" and attribute to that, all of Wal-mart's success. You don't realize how hindering this "benefit" is, nor even realize it's incumbent upon you to demonstrate otherwise. I've explained this again and again, for example, by asking you to apply the same standards to anyone who uses "the interstate highway system" and ask if you consider the state the sine qua non of their success. That attempt was, of course, lost on you.

Quasibill, who has mopped the floor with Person in previous debates when he made that same argument about the Interstates, had at him once again:

You would realize that whatever "benefit" they're getting from the government, that input would be far, far, far cheaper if they could buy it on a free market. That "benefit" is a hindrance.

So, in person's world, welfare moms would receive better benefits to sit at home and churn out kids absent the state. The Robert Byrd outhouse on the appalachian trail would be furnished in platinum. The 15 administrative assistants in my school district would be making more than the $95,000.00 salary they are already making for their 30/hr a week jobs. Contractors on public works jobs are making less than they would in the absence of prevailing wage laws. Union members are actually making less than they would if companies were allowed to fire them if they went on strike.

Bwahahaha. This isn't the first time that Person has used that lame argument about the Interstate, and then been used to mop the floor by quasibill. Alas, quasibill's puny logic is powerless against Person's mighty head of brick. Flash back to this exchange:

[Person]: Furthermore, if you divide the costs of the road system out by the users, it's clear they're getting a great deal. If you don't beleive the free market could replicate this, that's an indictment of the free market, not of government -- hardly a libertarian position. What's more likely is that Wal-Mart is hindered by government, not helped. Transportation would be easier, not harder.

[quasibill]: Hardly. The whole point of state intervention is to give *someone* a good deal. Of course, the point that Rothbard made, and apparently many Austrians currently fail to realize, is that the unstated part of that deal is that someone else gets a raw deal. So to argue that big business wouldn't get such a good deal on roads in a true free market is NOT an indictment of the market.

[Person]: The state build roads. But the market is better -- the market would have made better, cheaper roads, and long-distance transportation would be even cheaper.

[quasibill]: This is not necessarily true. The market is better, but not always cheaper. Just ask any robber or burglar....

It appears from your answers that you have a serious misunderstanding of the issue of cost in general versus cost to an individual.

Just because transportation would be cheaper in general if left to the market does NOT necessarily imply that it would be cheaper to a given individual or business. In fact that is exactly why socialism exists - to defray the costs suffered by certain individuals off onto the taxpaying class as a whole. The whole point is obviously to make it cheaper for certain individuals or classes than it would be otherwise. Government is incompetent in general, sure, but it does succeed at re-distributing wealth fairly well.

So your assertion that transportation as a whole would be cheaper, while likely true, does nothing to refute the argument that for an individual actor like Wal-Mart, it would likely be more expensive, as they no longer could spread the costs among the taxpaying base.

A lot of other good criticism, as well. M.E. Hoffer, whose comment about sweatshops drew Kirklin's "best available alternative" response, repeatedly rubbed Kirkland's nose in the fact that the labor conditions being criticized extend to forced labor (another anonymous commenter referred to the rapes, tortures, and mass murders carried out by the regular military units that Exxon hired for security in Indonesia, helpfully supplying them with equipment to dig mass graves--say, isn't Indonesia another of those "free market" havens for sweatshop employers?).

Kirklin responded with a lot of embarrassed heming and hawing and "what I meant to says" to the effect that he didn't support rape, torture, or murder, and that no American company should be doing business with people engaged in such things. This got contemptuous responses from Anonymous...

Then maybe, just maybe, you shouldn't write an extensive article that praises state-capitalism and forced-labor camps, and assume that anyone who disagrees with you is "utterly ignorant of economics." And in many places, it is incredibly difficult for a worker to quit if he doesn't like his job. Many corporations sieze land and farms that are already being used by other workers, meaning that there isn't much of a choice whether to work for them or not. Other corporations refuse to pay workers for a very long time, so that they can't quit (or they get none of the pitiful amounts of money they earn)....

Take a gander at this article. This worker was literally worked to death in a sweatshop not much different from the ones Wal-Mart owns. This worker COULD NOT quit, because the company refused to pay her on time. Read about the totalitarian conditions in this place (even the most hardcore laissez-faire supporter will be wincing while reading this thing). Truly sickening....

...and Hoffer:

If you really believe what you say : "I don't think companies should use slave labor under any circumstances.", then you should revisit the main thesis of your article, check many of your premises, and fully research the source of many of the products WMT sells.

quincunx, that inexhaustible fountain of faulty logic, responded to Anonymous' Indonesia link with the brilliant argument that the atrocities were committed by the Indonesian army, not Exxon--this despite the fact that Exxon hired the army as rent-a-cops and then gave them the equipment to dig mass graves. Quincunx continued:

...you put yourself in a tight corner, since you can't praise ANYTHING as long as nation states exist. Period. Your examples show CRIME, fully backed by corrupt governments. If you want to solve these, you must protest their dictators....

"Many corporations sieze land and farms that are already being used by other workers"

And who is the broker in this transaction? I think you know.

Now that's a brilliant argument. The guy holding the bag is just a passive beneficiary of the guy holding the gun. He's a victim of circumstances! The robber would probably kill him if he didn't take the money! And anyway, as Person suggested above, just think of how much money the bag man could have got if he weren't for all that interference from the guy with the gun! Anonymous turned quincunx's upside-down logic back on its feet again:

And you put yourself in a tight corner by praising EVERYTHING as long as nation states exist. According to you, any corporation that makes a living by hopping in bed with the state is just as innocent as can be. Poor, poor corporate fatcats! I feel soooo sorry for them--being denounced for working with the state and stealing at gun-point.

To which Blah responded:

We're talking about a pretty gray area here (i.e. When a state commits a crime, how much of the blame falls on corporations for not stopping, or even aiding, the state?). In my opinion, to say that it seriously hurts the author's thesis is insane, and not worth debating further.

Yeah, sure enough, it's a pretty gray area. Hiring the army to commit mass murder and then helping it dig the mass graves. Or constructing the Nazi death camps, and then using their inmates as slave labor in your factories. Yeah, that's a toughie, all right. Could take an army of ethical theorists forever to work through all the complexities and permutations of moral ambiguity like that. Certainly anyone who jumps to moral conclusions about something as iffy as the free market credentials of I.G. Farben must be barking batshit insane. In the meantime, let's get back to praising Wal-Mart's holy name!

Another great comment came from Shane Steinfeld, Minister of Truth for the Bureaucrash Activist Network:

I have a hard time thinking of Wal-Mart as a "shining example" of market economics. First, Wal-mart is a corporation -- a business that has purchased "limited liability" protections from the government, in the form of a "corporate license". Corporations (in the "limited liability" sense; not the formal, "corporate structure" sense) wouldn't exist in a truly free market.

Too many "free-market" libertarians seem to forget (or fail to realize) that Adam Smith's Wealth of Nations was the premiere anti-corporate manifesto: The free market was conceived as a way of protecting against the unholy marriage of business & government. I'm no economist, but I'd venture to guess that the issuance of corporate licenses represents the single-biggest intrusion of government into the economy today.

Second, let's not forget that Wal-Mart is one of the nation's largest beneficiaries of eminent domain abuse. The company seems to have no problem asking local governments to grab up private property & transfer it into their hands.

Let's not all line up to be corporate cheerleaders, just because it's the opposite of what the socialists are doing. Wal-Mart is no hero, in my book.

Monday, July 24, 2006

Three Quotes on Intrinsic vs. Extrinsic Motivation

In my opinion, the salient cause of ineptitude in promotion and in all hiring practices is that, under centralized conditions, fewer and fewer know what is a good job of work. The appearance of competence may count for more than the reality, and it is a lifework to manufacture appearance or, more usually, to adapt to the common expectation. Just as there is reliance on extrinsic motives, there is heavy reliance on extrinsic earmarks of competence: testing, profiles, publications, hearsay among wives, flashy curricula vitae. Yet there is no alternative method of selection. In decentralized conditions, where a man knows what goes on and engages in the whole enterprise, an applicant can present a masterpiece for examination and he has functional peers who can decide whether they want him in the guild.

....What swells the costs in enterprises carried on in the interlocking centralized systems of society, whether commercial, official, or non-profit institutional, are all the factors of organization, procedure, and motivation that are not directly determined to the function and to the desire to perform it.... [Paul Goodman, People or Personnel]

...the social needs exist in the school as "goals of the administration" and this adds many complications: the scholars must be motivated, disciplined, evaluated. But when students who want to be lawyers or doctors find themselves a faculty, or masters with something important to profess attract disciples, the case is simpler: the goals are implicit and there is no problem of motivation. [Paul Goodman, The Community of Scholars]

Atro had once explained to him how this was managed, how the sergeants could give the privates orders, how the lieutenants could give the privates and the sergeants orders, how the captains... and so on and so on up to the generals, who could give everyone else orders and need take them from none, except the commander in chief. Shevek had listened with incredulous disgust. "You call that organization?" he had inquired. "You even call it discipline? But it is neither. It is a coercive mechanism of extraordinary inefficiency--a kind of seventh-millennium steam engine! With such a rigid and fragile structure what could be done that was worth doing?" This had given Atro a chance to argue the worth of warfare as the breeder of courage and manliness and weeder-out of the unfit, but the very line of his argument had forced him to concede the effectiveness of guerrillas, organized from below, self-disciplined. "But that only works when the people think they're fighting for something of their own--you know, their homes, or some notion or other," the old man had said. Shevek had dropped the argument. He now continued it, in the darkening basement among the stacked crates of unlabeled chemicals. He explained to Atro that he now understood why the Army was organized as it was. It was indeed quite necessary. No rational form of organization would serve the purpose. He simply had not understood that the purpose was to enable men with machine guns to kill unarmed men and women easily and in great quantities when told to do so. [Ursula LeGuin, The Dispossessed]

Sunday, July 23, 2006

Larry Gambone on Corporate Welfare Reform

It isn't necessary to control corporate capitalism with legislation that restricts its harmful aspects. Simply pull the plug on it – abolish corporate law, patents, eliminate all forms of government assistance, no more state as capitalist goon squad, repeal all anti-worker legislation....

Without its state provided life support systems, corporate capitalism would gradually disappear, in the same way the Mom and Pop hamburger joint faded away thanks to MacDonalds. Only this time the evolution would be in the opposite direction. Nature abhors a vacuum, with the state's vicious pets dying off, small businesses, small farms and local production would return. I suspect many new ventures would be cooperatives. With a high level of local production and local consumption the vagaries of the corporate created world market would lessen and we could evolve into a “steady state economy” rather than the ecological insanity of “growth as God.”

Vulgar Liberalism Watch, Part II

Sometimes the biggest obstacle libertarians face in communicating with "progressive" liberals is libertarians: i.e. the common liberal impression, often justified, that libertarians are just pot-smoking Republicans who see corporate welfare queens as the victimized party in modern society. As I've said before,

in my list of statist evils, the guys who are breaking legs rank considerably higher than the ones handing out government crutches. All too many libertarians could care less about the statism that causes the problems of income disparity, but go ballistic over the statism intended to alleviate it. It's another example of the general rule that statism that helps the rich is kinda sorta bad, maybe, I guess, but statism that helps the poor is flaming red ruin on wheels.

But sometimes the obstacle is the utter tenacity with which liberals themselves hold on to their own misconceptions: e.g., that the state is the only possible means of coordinating cooperative behavior between human beings, and that the only alternative is a Hobbesian free-for-all.

This was illustrated by an interesting open thread at John Quiggin's blog. It was quickly taken over by a discussion of the benefits of cooperative behavior in game theory.

The beginnings were quite promising. Meika started with a link to a story about Timothy Killingback's work.

Under the typical public goods game, an experimenter gives four players a pot of money. Each player can invest all or some of the money into a common pool. The experimenter then collects money thrown into the pool, doubles it and divides it amongst the players. The outcome: If every player invests all the money, every player wins big. If every player cheats by investing a just few dollars, every player reaps a small dividend. But if a cooperator squares off against a cheater – with the altruist investing more than the swindler – the swindler always gets the bigger payoff. Cheating, in short, is a winning survival strategy.

Under the new model, the team introduced population dynamics into the public goods game.

Players were broken into groups and played with other members of their group. Each player then reproduced in proportion to the payoff they received from playing the game, passing their cooperator or cheater strategy on to their offspring. After reproduction, random mutations occurred, changing how much an individual invests. Finally, players randomly dispersed to other groups, bringing their investment strategies with them. The result was an ever-changing cast of characters creating groups of various sizes.

After running the model through 100,000 generations, the results were striking. Cooperators not only survived, they thrived and maintained their numbers over time. The key is group size.

Terje supplemented this with a recommendation of Richard Dawkins' The Selfish Gene for its "insights in the area of altruism arising from systems that are seemingly driven by payoffs for selfish action." He added:

To a large extent it is why I think the use of state based coersion to supposedly enforce and ensure altruism and co-operative behaviour is mostly flawed and unnecessary. Most of what the state currently does in the name of altruism (ie the welfare state) can be better achieved in the long term by individual acts of charity, free market dynamics and civil society.

This is the point at which Paul Kelly, our exemplary vulgar liberal, jumped in:

Regarding welfare etc, quite often those individuals decide it is more efficient and rational to do these things collectively, through a central authority. It makes economic sense.

Frequent Mutualist Blog commenter P.M. Lawrence confronted him on the issue:

Actually, no, PK, it doesn’t make economic sense - unless of course the range of options has been restricted beforehand. Guess what, in our time and place it has been restricted like that.

Lawrence was kind enough to direct Kelley to my blog for some relevant material. Kelly's response:

So everyone should wander around guessing who is the most needy and give them money? Just pick the skinniest person? Or should research be done?

And they say the government schools aren't teaching critical thinking skills! Lawrence's rejoinder:

I’m sorry PK, was there some reason you didn’t find the material I referred you to at Kevin Carson’s site, or is it just that you think I should spoonfeed things?

Surely you aren’t under the impression that (a) the problems would be as great as they are now if only efforts were made to engineer them out (rather than provide governmental palliative care for them), and (b) that only a government can ever handle problems?

Fatfingers attempted to interpret Kelly's comments in a charitable light (i.e., finding some way of reading them as something other than total idiocy)....

PM, don’t confuse collectivism for government. PK talks about collectives, and you assume government. While I personally believe government will inevitably organically arise from collectives, for the purposes of thought experiments, stick with the given parameters.

...but Kelly wasn't having any of it:

You’re right PM, I’m not going to read a long economic paper explaining why it’s better for everyone to walk around making their own individual decisions. I would prefer a spoonfeeding please.

Lawrence came back:

Fatfingers, I did not “assume” that PK was talking about governments. He was explicitly talking about central authority, not merely some form of co-operative or collective action. That’s what a government is. If you are obliged to submit to it, it qualifies under the walks like a duck test.

Finally, tipped off by Lawrence to the interesting thread, I stopped by and left a comment:

As P.M. Lawrence said, it is Paul Kelley who assumes that cooperative effort can only be organized through government, and PML who is trying to get it into PK’s head that cooperative (or collective) effort can be achieved by voluntary means.

The fact that PK automatically dismisses any suggestion that voluntary cooperation is possible as a call for “everyone [to] wander around guessing who is the most needy and give them money,” suggests to me that PK’s problem goes beyond mere historical illiteracy. The underlying problem is far more basic: an inability (or unwillingness) to recognize a non sequitur in his own argument. If he is unable to acknowledge a fundamental logical flaw in his argument, all the empirical evidence in the world won’t do him any good.

But I’m more than willing to accept a person’s admission that he’s too lazy to follow a simple link that directly concerns the validity of a general assertion he made, or that he’s uninterested in any evidence as to whether his opinion is correct–just so long as he’s willing to admit that his opinion is, as a result, absolutely worthless.

For anyone else who is interested, though, there is a wealth of historical material on associations for mutual aid among the working class before the rise of the welfare state. Kropotkin’s last two chapters on the recent history of Europe in Mutual Aid are a good starting point.

E.P. Thompson has a great deal of good information on sick benefit societies, burial societies, and other mutuals in The Making of the English Working Class.

Colin Ward’s Anarchy in Action contains a section on the “welfare road we failed to take.”

Dr. Bob James is one of the best historians of working class friendly societies in the 18th and 19th centuries. Many of his articles can be found at the “Radical Tradition” site.

Finally, Section J.5.16 of An Anachist FAQ has an amazing amount of material on such self-organization, including extended block quotes and many, many references.

The kinds of voluntary mutual aid described by these writers were first suppressed by the capitalists (because they were seen as potential breeding grounds for subversion, and a possible basis for mutual economic support during strikes), and later crowded out or suppressed by regulation when the New Class decided that working class self-organization was atavistic and should be supplanted by the benevolent supervision of “qualified professionals.” David Beito’s From Mutual Aid to the Welfare State is a history, in large part, of the latter phenomenon, in addition to a good account of mutual aid organizations themselves.

Saturday, July 22, 2006

Sheldon Richman on Nock

...for Nock, the United States does not represent the radical break in political history that it is often made out to be. It metamorphosed from the British system of privilege (through land grants, tariffs, and other enactments), despite the Jeffersonian window-dressing, then forged a distinctly American form of the merchant-State. Stripped to essentials, it was Oppenheimer’s organization of the political means, with the business class as the prime beneficiary.

Part of Nock’s view is colored by his position on land ownership. Nock was a follower of Henry George, who held that no individual has the right to the value of land per se because that value is created not by the putative owner, but by the community. Thus that value should be taxed for the benefit of the community — the famous “single tax.” (The individual user of land, however, did have the right to the fruits of his labor.) For George and Nock, a host of evils grow out of a Lockean notion of property ownership, including land speculation and scarcity. (Nock was no fan of Locke or Adam Smith.) But Nock’s view of American history is also shaped by a view of ownership that is not dependent on George’s position. Nock (like Rothbard after him) condemned the political creation of scarcity in land — the process by which rulers parcel out property (which they never homesteaded) to favored interests, who then charge rent for others to use and occupy it. This thoroughly illegitimate “land monopoly” creates far-ranging injustices. For example, it prevents competition and closes off options to the mass of people, forcing them to work for others, depressing wages, and leaving them vulnerable to exploitation. In a society without land privilege, workers would have alternatives to standard employment. Nock thought the initial distribution of land was crucial, and that many in society suffer long after that distribution is made. This suffering then is used to justify further state intervention.

Friday, July 21, 2006

Crispin Sartwell on Our System of Free Market Democracy

The American state and the American corporation are intertwined from the top down, as they swap lobbyists for congressmen, regulators for board members. The global economic situation is governed by trade agreements performed by government officials, most of them no doubt about to return to industry.

Essentially, we're in a command economy, whether it's run by "Democrats" or "Republicans," who differ at most on the details of how to manipulate the economy by tax or monetary policy. God only knows what "capitalism" is supposed to mean these days, but it surely doesn't mean free markets....

As Thomas Friedman and many other transcenders of the past have argued, what separates the Chinese from the American system is that American education is insufficiently rigid and centralized to be "competitive in the global economy." This problem is being rapidly addressed in the only way it could be: by massive bureaucratic regulation of every level of the life of every child. Another term for this is "excellence."....

Everyone pervasively applies state power for economic purposes. And everyone, to one extent or another, regulates expression both by economic and political means.

And the overall movement is toward a convergence of all these systems in centralized polities dedicated to rapid and regulated economic expansion. The Chinese and American systems grow more similar at every moment, but neither one of them is becoming more free-wheeling, more open to criticism, more entrepreneurial, or more creative.

They compete with one another to dominate global markets, but they cooperate to manufacture the profoundly unfree future.

Great Discussion on Corporate Hierarchies

Damn, but this is good! Jeremy Weiland of Social Memory Complex got into an interesting discussion with Alexander Kjerulf on the latter's blog post "How Not to Lead Geeks." The post itself wasn't bad--a fairly good Dilbertesque take on tech workers' negative reactions to the pointy-haired boss. But the discussion in the comments was amazing.

Weiland entered the fray about halfway down, channelling Friedrich Hayek and R. A. Wilson:

I would be very interested in your opinion on the proper role of management.

We can talk all day about the ways management messes up in its relations with any social category (as if this type of conflict was anything fundamentally different than the ongoing tension between labor and management since the Industrial Revolution) but I’m afraid a lot of geeks see management as the solution to a problem that management itself created. Here’s the problem: no matter if you’re a geek, genius, or MBA, unless you’re doing the work, you’re in the least informed position to make decisions. Reports, scrums, charts - none of it is a replacement for being there, doing the work, and knowing the situation at hand. You can’t separate the experience of work from the process.

The problem isn’t bad management, it’s the whole concept of management: the idea that decision making can be separated from the actual work.... The problems with management are the same problems in any organization hierarchically structured where information flows between relatively more powerful and relatively less powerful people - because the jobs are on the line, and management is always playing catch up to the true situational picture, managers are simply told whatever they need to hear in order not to be fired much of the time. There’s a delay involved as well as a fundamental case of rose-colored glasses. It’s easy to see why somebody like Ken Lay could argue he didn’t know what was going on - in fact, I fail to see how any manager who isn’t getting his hands dirty on a project could possibly claim a knowledge of the project sufficient to judge it.

Really the only use for management is to keep other bureaucracies internal to the organization (such as HR) and external to the organization (such as the IRS or OSHA) from bothering the creative guys. Other than that, I see no reason why - if we’re going to have some people doing make-work “management” - they should be calling the shots. I don’t see why we working geeks should need to ask for the right to make decisions in the first place, other than that the power relationships are severely out of whack. Maybe we should start reforming there, instead of finding better ways to use managerial voodoo to pretend like managers have some gift to offer those of us who actually do the work.

Kjerulf responded in the voice of Tom Peters, who can also be pretty good at times:

Jeremy: You’re right, as long as we define management as making decisions for others. That has of course been the traditional role of management for the entire industrial age and we’re stuck with the paradigm.

However, I think that this type of management works pretty badly in industrial, production-oriented workplaces. In knowledge-based, creative businesses it’s even worse, for precisely the reason you mention: It’s an attempt to concentrate decision making away from the people actually doing the work. In a constant world, this has at least a passing chance of working. In a fast-changing business environment? Forget about it!

So traditional management is out. But leaders and managers are still very much needed, it just has to be a different brand.

Yesterday it meant making decisions, allocating resources, making plans, checking quality and enforcing regulations.

Today it has to be coaching, mentoring, teaching, facilitating and supporting.

THAT is the role of management. One that not only makes people happy at work but also gives businesses much better results. It’s not pie-in-the-sky, this goes straight to the bottom line!

Back to Weiland:

...let me make clear: I have no problem with managers are you describe them - at least, when they make business sense. I have no problems with hierarchies, where they naturally occur. But as long as one has to operate in the business world, one will have to deal with those inputs and influences that drain energy from productive organizations. So if managers can keep that stuff off of the guys in the trenches, provide actual (if marginal) value to those workers, and make sure the focus is not on “command and control” (it didn’t work in the Soviet Union; it’s not going to work in the corporation) but on arriving at decisions through a process that at least APPROACHES informed consensus - while still giving individuals freedom to take risks and pursue personal visions of value-adding to the organization - then I think that’s great. And if some suit-and-tie types get a little scared in the process, well, so much the better - market corrections happen, right? :-)

If leaders foster this environment without overburdening the individuals (i.e. seeing employees as “resources” whose output must be maximized rather than essential, creative, nuturing parts of an organic organization) then great. And I agree - a well managed work force is a total bottom line matter. The problems in current corporate climates rise not from the profit motivation but from the inability of management to see the long term time horizon, where the true growth and profitability occurs - usually from a lack of information, sophistication, or passion about a given project. True revolutionary, profitable value creation rarely occurs overnight or over the course of a year, even.

The key is to get managers into a frame of mind where they don’t interject themselves where unneeded. You sound like the type of manager who manages from a position of competence and not simply “monitoring human resources”. But please be aware: you are the exception (as I’m sure you already know). There is a “class” of white collar paper pushers and timesheet minders who see the worker as an adversary, not a partner, and who try to harvest the forest rather than grow and nurture it. This is a matter of fundamentals: “Who moved my cheese” or “Fish!” philosophy and mindlessness can’t mask it.

That "time horizon" thing is pretty synchronicitous, if that's even a word. I first read this exchange several weeks ago, before I read the book that resulted in this recent post: "Robert Jackall on Corporate Bureaucracy."

Kjerulf enthusiastically endorsed that comparison of top-down direction in the corporation and in Gosplan:

I could not say it better!

He also linked to a post about the success of Enterprise Systems:

* We had no managers
* People did excellent work
* We made major decisions together, democratically
* We made good money (not obscene, just good :o)
* We had fun
* All employees became co-owners
* People didn’t work too much - 40 hrs a week or less
* Leadership changed hands dynamically

Elling joined the exchange at this point, expressing his doubts about the dispensability of hierarchy:

....I think you’re attacking structures which you can do without in a small company....

In a large company there’s a NEED for the structures which you are proposing to tear down. And I think you’d notice it if you spent some time as a manager in such a company.

Weiland's response:

I can anticipate some of this need - the need to account for diverse costs accurately and thoroughly, the need to maintain a standard of output for workers in an organized, fair fashion, etc. - but these play to the weaknesses of large organizations. In other words, large organizations SHOULD be at a disadvantage, and the structures we’re proposing tearing out actually add value only in the sense that MegaCorp is inherently inefficient and out of scale with the market.

So... the need for management - and the organizational pathologies that accompany it - are symptoms of the problem of scale, not the problems themselves.

Elling again:

What I mean is that large companies need to have a hierarchical structure. And in such companies there need to be people assigned with jobs to “manage” groups of other people. If you do not organize it this way, it simply becomes impossible to handle.

Cityzen jane made an excellent point about the difference between intrinsic and extrinsic motivation, that sounded an awful lot like Paul Goodman:

What a lot of manager’s seem not to understand in more traditional companies (and I’ve worked both for huge companies and skunkwork garage projects) is that creative people (geeks, visual people and researchers) are intrinsically motivated. If they are good, they wake up and go to bed and dream about ng things better, more elegantly - more beautifully. I certainly do.

And that there is no better way to kill that in a person than to apply arbitrary, theory driven management methods and standards to them, or try to shove a technology you read about in PC magazine as the next big thing at them. Most managers get into their positions because of external motivational factors…. more money - bigger car, bigger house…Yes, those perks are great icing on the cake - but the best most of US hope for is a place where our talents and brains can be fully expressed.

We are internally motivated. We are on the eternal search for the best possible work situation and we very often will leave on a dime - for less money to find it....

It’s hard for a manager to hear that for the most part they are often irrelevant to the productivity of the techie. But it’s pretty much the case. I spend about 70 hours a week. 40 required by my job, the rest - because I am insatiably curious about technology and how to do things better. It is my nature. You want to encourage me to be myself in this regard or I am unmotivated to use my extra cycles for YOUR bottom line. With proper care and feeding I wish to make that MY bottom line - but that doesn’t happen if I’m a just cog in your plan for world domination or at least a Lexus by end of next quarter.

Weiland's response:

I think this applies to production and line workers, too - it’s just that management likes inculating a culture that prevents them from expecting the right sorts of incentives for efficiency. Whenever possible, management wants a bunch of predictable, homogenized worker “units” rather than having to deal with people with different talents, motivations, etc. It’s just easier if you’re gonna do central planning....

My point is that for the typical manager, a workforce of 100 people who all produce at 80%, who all have the same world view, and who all have the same capacities - that is FAR preferrable to a workforce with some people who are 100% prouctive, some who are 60% or 70%, and who are diverse and have different goals in life.

That’s why in the blue collar industries, the goal is to deskill labor by making everything an “assembly line” process. If they can get labor to do just what’s necessary for production with no creativity - and have management direct all production centrally - they prefer it even though it’s less efficient because it makes them necessary.

He tied this strand in with the other one, Elling's remarks on the need for hierarchy in large organizations:

The problem for large organizations with this model [of bottom-up organization and self-directed work] is that it’s hard to guarantee reproducable results, NOT that it’s unworkable. The key is the control issue - they’d rather have control than success when it comes down to it. It seems perverse and counterintuitive but it’s true - when your job is on the line and you don’t have control over all the factors of production, you can be incredibly risk adverse, to the point of defeating the whole reason you exist: profitability.

Large organizations need to moderate the volatility of human factors such as creativity, personal lives, touchy-feely concerns, etc., which is why they higher managers to turn us all into “human resources” that are rationalized and understandable. They’d much prefer a decrease in productivity to a decrease in forcastability because of the inherent problems with large scale organization (it’s the same with a government, an educational institution, etc.). This is largely due to an entire class of people who see management as a task distinct from the actual productive work, which as I said before is ridiculous. They are scared on some level because they often simply don’t understand what it really means to produce good value. How can they - human motivation and ingenuity is not something you can break down into a cut and dry formula and “institutionalize”!

Since large groups can’t internalize the decision making necessary to engage in authentic risk (like individuals can) they are doomed to continuously direct workers by fiat, micromanage strategies where they do exist, and collect copious amounts of metrics to systematize what is essentially an entrepeneurial, personal, passionate endeavor that really can’t be quantified.

For me, the question is not whether or not large organizations need hierarchy. It's whether large organizations themselves are needed. All the management machinery that was created to manage the large corporation became necessary only because the state encouraged the growth of firms that large in the first place--firms far beyond the point of diminishing returns when it comes to efficiency. One might as well ask whether hierarchical management was "needed" in a single state factory that produced half the widgets used in the USSR. The question ought to be why the factory was that big to begin with.

Kjerulf was so stimulated by the discussion that he summed it up in a new post: "The Need for Structure."