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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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Friday, August 05, 2005

Dan Swinney Article on High Road

Dan Swinney of the Center for Labor and Community Research, author of Building the Bridge to the High Road and frequent reporter on the cooperative economy in Emilia Romagna, has an excellent article in The High Road newsletter: "A Third Way? Or the Only Way?"

Is the Social Economy a Third Way to produce and distribute goods and services, particularly suited to the margins of a market economy dominated by traditional capitalist business interests and practices? Must real solutions to the economic devastation we see around us come only from government? Is our movement's primary arena of contention therefore that of politics at the local, regional, and national levels?

At the Center for Labor and Community Research (CLCR) we answer "no" to all three. We have an obligation and an opportunity to present a compelling and comprehensive alternative to the neo-liberal model in the political arena. But we can and must also do so in the market itself, and make ours the mainstream model of development for our countries.

The Social Economy is not a Third Way--it is the Only Way, and the market is the place to demonstrate this claim to hegemony in tandem with the use of our political skills in the more familiar terrain of the state. If we are willing to use our values, our militancy, our ability to organize, and our commitment to radical democracy, and combine them with the technical skills of business assessment, finance, and management--if we ar willing to do all this, we can compete in the market and win.

He's preaching to the choir as far as I'm concerned. I've written myself about the need for the alternative economy or counter-economy to grow beyond merely operating in the interstices of a state capitalist structure, and to evolve into an interlocking network of cooperative production, finance and retail operations that will eventually supplant the existing state capitalist framework. I am a little ambivalent about his reference to "political skills" and the "terrain of the state." If that refers to using political pressure to roll back the state's current intervention on behalf of corporate interests, well and good. If it means an integral role for the state in creating and maintaining an alternative system (as he suggests below), I'm agin it.

Here's how a character in Ken Macleod's The Star Fraction put it:

...what we always meant by socialism wasn't something you forced on people, it was people organizing themselves as they pleased into co-ops, collectives, communes, unions.... And if socialism really is better, more efficient than capitalism, then it can bloody well compete with capitalism. So we decided, forget all the statist shit and the violence: the best place for socialism is the closest to a free market you can get!

Swinney draws several lessons from his years of experience in the CLCR, of using High Road practices to save and turn around failing business firms under labor and community leadership.

One of them I strongly agree with:

The market is not synonymous with capitalism. The market is an achievement of human civilization that both predates capitalism and will persist for a long time even if capitalism is replaced by another system.

Indeed, capitalism is simply a system of class privilege in which the state intervenes in the market on behalf of capitalists. The term capitalism was originally coined, not to describe a system of free enterprise, but a society in which industrial capitalists exerted the same control over the state as did the landed aristocracy of the Old Regime.

Another of Swinney's generalizations I disagree with just as strongly:

...our role in the market is complemented by our success and influence in the state and civil society. There has never been and never will be a "free market." Every value system uses the regulatory, coercive, co-ordinating, and incentive power of the state, as well as its influence in the broader culture to supplement its power in the market. And so must we.

The observation that markets operate in a framework of social coordination, and with a social consensus on normative rules, is hardly new. It's also unexceptionable, as far as I'm concerned. The real question is whether such coordination requires a state. The real question, identified by Proudhon, is whether Liberty is the mother or the daughter of Order. Is social peace and cooperation impossible without some organization that claims the right to initiate force on behalf of all inhabitants in a given geographical area, and a monopoly on the right to define the legitimate use of force in that area? I also disagree, by the way, with Swinney's attempt to distinguish "the market" not only from the state, but from "the broader culture." The market is not just the cash nexus. It is the entire realm of voluntary transactions, including mutual aid, cooperation, and the gift economy.

It is true that there has never been a free market. There has likewise never been, since the birth of the state, a statist society free of class rule and exploitation. If the fact that one of these has never existed implies that it never will, then why doesn't the same conclusion also apply to the other? Since the rise of advanced civilizations several thousand years ago, we've never had a developed society without both a coercive state and a parasitic ruling class. If we cannot free ourselves of the one, what reason for hope is there of ridding ourselves of the other?

More often than not--if not always--the state has been the enemy of the kinds of socially enforced rules and cooperation that markets depend on. The evils that Swinney identifies with the Low Road were brought about by the state--capitalism was created by the state, through a coercive revolution imposed from above--and depend on state intervention for their survival. The state, by definition, is a coercive mechanism; that mechanism is used to create externalities, and to benefit one class at the expense of another. Any state intervention in the market results in a zero-sum outcome, in which one party benefits at another's expense. That is why class exploitation requires a state.

Since the beginning of history, a social order based on voluntary cooperation and peaceful exchange of labor between producers has existed only within the interstices of a statist system of class rule. Our goal is eventually to replace coercion with voluntary cooperation, to the greatest extent possible. The method was described by Gustav Landauer:

The State is a condition, a certain relationship among human beings, a mode of behavior, we destroy it by contracting other relationships, by behaving differently toward one and other...

...and by Paul Goodman:

A free society cannot be the substitution of a "new order" for the old order; it is the extension of spheres of free action until they make up most of the social life.


Anonymous Anonymous said...

You'd better have a good think about just how ground cover plants work. They co-operate to make a network externality to dominate a local ecology to exclude other plants, usually by outshading them but sometimes like Eucalyptus by poisoning the earth against other root types (e.g. with leaf litter). The thing is, while the analogy applies to one sort of economy, that doesn't make the alternative on offer exempt from the same flaws. Almost any approach that worked as a system would inherently tend to exclude other approaches - and the "socialism" discussed here as a truly free market alternative is one such.

August 05, 2005 10:52 PM  
Anonymous Anonymous said...

"The state, by definition, is a coercive mechanism; that mechanism is used to create externalities, and to benefit one class at the expense of another. Any state intervention in the market results in a zero-sum outcome, in which one party benefits at another's expense. That is why class exploitation requires a state."

I think it might be more appropriate to say that the mechanism - enclosure of the natural and social commons - affords benefits and natural opportunities to accrue to the privileged while creating a legal and monetary obligation on the excluded which can only be satisfied by negation of their property rights to the fruits of their labor.

BillG (not Gates)
classical progressive green

August 06, 2005 8:32 PM  
Anonymous Anonymous said...

I don't think that sort of class-oriented exploitation requires a state, unless you are using this "state of affiars", as it were, as a definition of a state. All it takes is entrenched power, not any putative legal/moral authority. It's a "good men do nothing" thing.

August 08, 2005 2:13 AM  
Blogger Kevin Carson said...


There may be something to what you say in your first post. After all, a system is more than the sum of its parts. And my own point was that a cooperative system of production *and* distribution and financing would be mutually supporting.

But such a mutually supporting network, IMO, is the natural result when the state stops subsidizing other ways of doing things. The corporate system requires ongoing state intervention for its survival. Decentralized, small-scale production and cooperative forms of ownership, on the other hand, are what's likely to emerge without state action.

Re your second comment on the necessity of the state for exploitation, read Oppenheimer's case in the opening part of The State.

August 08, 2005 9:44 AM  
Anonymous Anonymous said...

While I agree that a lack of a state would produce that sort of decentralised thing as emergent behaviour, I see two caveats. One is that - without a clean transition - there would be casualties getting there from here, and how is that clean transition itself to emerge? The other is that, cancer like, eventually exploitative groups would emerge - bandits, pirates, or whatever - who would regard everything other than their own in groups as fair game. This in turn starts the long climb (descent?) to organised force structures working in a systematic and sustained way. I was pointing out the lack of any immunisation, as it were, against this latter development. Greece had decentralisation for centuries before the Greeks arrived with ar

August 08, 2005 9:46 PM  
Blogger Kevin Carson said...


In a sense the transition period would *be* the immunization you're looking for. If such a society ever comes about, it will be the end result of a prolonged process of education and alternative institution-building. So it's likely the general population will be dedicated to a decentralized, bottom-up way of doing things and be prepared to resist any "man who would be king."

August 11, 2005 6:35 PM  
Anonymous Anonymous said...

That's throwing a greater burden still on the transition. We should also remember that cewrtain kinds of transition are inherently impossible because invariants get preserved (a technicality, like getting something out of nothing). As, when and if I annotate your work I must remember to highlight these issues. For now, consider what happened to the likes of the different Mormon sects that attempted to build within existing frameworks. Some, like the Strangites, were destroyed bu those that disregarded their own rules. Others vanished without trace. Others still became what they feared, using Danites, and some of today's Jack Mormons fence off the world and have to fit in a low profile way while they "bleed the beast" and tap social

August 12, 2005 1:49 AM  
Anonymous Anonymous said...

Drat. That was meant to be me, PML, again, not anonymous. Anyhow, I was using the various Mormon variants as a worked example of the difficulties of transition and the risk of merely reinventing Leviathan.

August 12, 2005 1:52 AM  
Blogger Kevin Carson said...

I agree the danger is there. That's why I emphasize attacking the structural framework at the same time as building alternative social insitutions.

August 13, 2005 4:12 AM  
Anonymous Anonymous said...

CarlD717 said:

I think Swinney's point, often missed by many free marketeers, is that the market is not simply a two way relationship between buyer and seller, but is really a three-way relationship between buyer, seller and cop.

The 'cop' enters the relationship in relatively simple forms of standardizing weights and measures or enforcement of contracts all the way up to more complex forms of adding value in the form of gathering and dispersing information that curbs market failure and grows wealth sustainably.

If we 'high roaders' stay out of this arena, we simply give the 'low roaders' a monopoly over these tools.

Strategically, in my opinion, the market, the state and classes all between to wither away as we make a global transition from economies of scarcity to economies of abundance, as we see the amount of labor time in a given commodity approach zero through cybernetics, and as we increase our knowledge of all economies as subsets of the ecosphere without any 'externalities,' and make the optimal adjustments.

A bit visionary to be sure, but it's what makes the 'high road' a worthy path through life.

August 15, 2005 3:52 PM  

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