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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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Thursday, December 22, 2005

Sympathy for the Devil

In the comments on "WTFWWTOD?" an interesting discussion sprung up over which think tanks and publications were most prone to vulgar libertarianism. The emerging consensus seems to be that most are a mixture of good and bad. But Mises.Org, for some reason, is a place of extremes, combining the best of the best with the most vulgar of the vulgar. As an example of the latter, Joel Schlosberg links to an especially awful piece, "In Defense of Scrooge," which seems to resurface around Christmas every year at Lew Rockwell or Mises.Org. Now you might wonder why, of all people, Levin picked Scrooge to defend. Oh, wait, I know--because he's rich! And as we all know, "free market principles" mean defending big business and the rich. Geez, I wonder why so many liberal Democrats instinctively reject libertarians as "greedy Republicans" in sheep's clothing, and why we have so much trouble promoting libertarian ideas in their venues. The answer, Mr. Levin, is in the mirror.

Levin's article includes this gem:

So let's look without preconceptions at Scrooge's allegedly underpaid clerk, Bob Cratchit. The fact is, if Cratchit's skills were worth more to anyone than the fifteen shillings Scrooge pays him weekly, there would be someone glad to offer it to him. Since no one has, and since Cratchit's profit-maximizing boss is hardly a man to pay for nothing, Cratchit must be worth exactly his present wages.

Note the standard vulgar libertarian pose of defending existing wealth, on the assumption that this is a free market. Now where have we seen this before? "Wal-Mart can't be exploiting workers or competing unfairly against small retailers, because the way a free market works is blah blah blah blah blah...."

Now, mind, Dickens' setting is an England where the Combination Laws and Laws of Settlement are still fairly recent, and large-scale waves of enclosures are still a living memory for many. In the previous two centuries, a majority of English peasants had been robbed of copyholds, commons rights, and other customary forms of tenure, and transformed (by state violence in collusion with the owning classes) into a propertyless proletariat. Any worker in an overpopulated parish of London who attempted to vote with his feet and seek work in the underpopulated industrial districts of the north, without permission, was a criminal under the terms of the internal passport system known as the Laws of Settlement. But voluntary movement being prohibited, the parish Poor Law overseers were more than happy to auction off denizens of the poorhouses, by the gross, to factory owners in said underpopulated industrial districts. Voluntary association to bargain for higher wages, likewise, was criminalized by the Combination Law--enforced, not by juries, but by administrative law with none of the customary common law protections for the defendant.

To summarize: the vast majority of English had been robbed of their property, society forcibly reconstructed from above, and the working majority put under totalitarian social controls by a plutocratic government, exactly as an occupying power would have done to a conquered population--all in order that they might be more easily exploited by the rich. The situation of the English working class during the Industrial Revolution, in other words, was slavery.

What next--a "free market" defense of wage rates in the Warsaw Ghetto?

Merry Christmas, everybody, and thanks for reading.


Anonymous Anonymous said...

The situation with the Laws of Settlement reminds me a little bit of how current immigration policy impacts the labor market. Especially when you look at the pro-corporation solution pushed by the neo-cons.

December 22, 2005 12:47 PM  
Blogger Unknown said...

Great observation, Logan!

It also, strangely enough, produces similar mechanics as subsidizing higher education and "de-skilling" manual labor... a certain group of people is formed who are essentially "de-certified" and unable to work freely and openly in the general labor market.

The idea is to create a tiered labor market, in which sub-classes become castes. The wealthy can then organize these castes for their own benefit.

December 22, 2005 1:16 PM  
Anonymous Anonymous said...

In fairness to Levin, he never says England is a free market. It's quite true that Cratchit's labour was probably worth no more than he was being paid.

Moreover, in fairness to Scrooge, the Settlement Laws and Enclosures were not his doing. His background tells us that he himself was born poor and made his wealth through the world through hard work and thrift. Now, as an employer, he benefits indirectly from these things, but there's no indication he's at the root of it.

- Josh

December 22, 2005 10:06 PM  
Anonymous Anonymous said...

Well, actually, Scrooge is helping perpetuate the strategic leverage, in proportion as the loan markets don't actually raise productivity but rather fuel competition for the money and so raise prices - the usury element.

I don't know what the proportion was when England was a developing country, but certainly Levin's made up example of people competing for loans for operations mainly serves to raise surgeons' fees rather than create new surgical options that would not have been there otherwise.

This area of funding is related to what Pigou considered might be "pecuniary externalities". The effect does happen, but it isn't an externality since aggregate wealth isn't changed. However it is transferred.

I hope to touch on some of this in an example I will put in my planned email about free trade to KC; it will be the part where giving farmers more productivity, and even more by lending them funds to cover it, actually impoverishes them with gains going to town dwellers.

(It's counter-intuitive, and is distorted by survivor bias usually making average farmers better off - people driven out don't get counted in the "after" sample. Sadly, "fair trade" doesn't help either, which is also counter-intuitive.)

December 23, 2005 2:41 AM  
Anonymous Anonymous said...


You are right that Scrooge doesn't operate in a free market, and that transactions between Scrooge and other characters are therefore in a sence not voluntary. But in some other sence they are.

Let me explain by using an example. Imagine we're living in a market anarchy. I'm a merchant selling doorlocks, and you are my customer. You buy a doorlock from me. At first site it looks like a free market transaction. But you wouldn't buy the doorlock if there was not some risk of burglary. So in a way you are coerced by (potential) burglars to buy a doorlock. And I'm profiting from that situation. So, following your line of reasoning as I understand it, I would be exploiting you, and my actions would be undefensible.

I would plead not guilty on the grounds of not being the one who coerces you. I'm not part of the problem, I'm part of the solution. In one sence our transaction is not voluntary, yet in an other sence it is.

I think the same goes for Scrooge. Off course Cratchit's options are limited by the state. So Cratchit is in a way coerced to work for Scrooge. But it's not Scrooge who is coercing him. Scrooge is not part of the problem, but part of the solution.

The only way Scrooge could be part of the problem, is when he somehow played a part in bringing about the laws which make Cratchit's life so difficult. As far as I know there is no mention of that in the story. (I never read the original book, so I could be wrong here, but I don't think Levin would have defended Scrooge if there was any mention of Scrooge actively using the state. Anyway, if I'm wrong about this, I'll be glad to hear about it.)

Off course in real life things aren't that clear cut. I agree with "vulgar libertarians" that people work for and buy from Wall Mart because it's the best option available for them, given the circumstances of state intervention, so Wall Mart is doing them a service. (And off course, they are doing Wall Mart a service.) But if Wall Mart actively plays a part in bringing about state intervention that limits peoples options, then they are in a way guilty of using slave labor. (Although one could argue that they are not doing so entirely voluntary themselves, since not doing that would put them at a disadvantage compared to competitors, due to state intervention, which means, following the same reasoning as above, they are coerced.)

December 23, 2005 1:13 PM  
Anonymous Anonymous said...

A defense of Scrooge? It's like this from "National Lampoon", but without the tongue-in-cheek:

Ayn Rand's A Selfish Christmas (1951)

In this hour-long radio drama, Santa struggles with the increasing demands of providing gifts for millions of spoiled, ungrateful brats across the world, until a single elf, in the engineering department of his workshop, convinces Santa to go on strike. The special ends with the entropic collapse of the civilization of takers and the spectacle of children trudging across the bitterly cold, dark tundra to offer Santa cash for his services, acknowledging at last that his genius makes the gifts — and therefore Christmas — possible.

Prior to broadcast, Mutual Broadcast System executives raised objections to the radio play, noting that 56 minutes of the hour-long broadcast went to a philosophical manifesto by the elf and of the four remaining minutes, three went to a love scene between Santa and the cold, practical Mrs. Claus that was rendered into radio through the use of grunts and the shattering of several dozen whiskey tumblers. In later letters, Rand sneeringly described these executives as "anti-life."

December 23, 2005 11:39 PM  
Blogger Kevin Carson said...


That's an excellent comparison. Right now, under the present immigration laws, employers have the best of both world. The laws are honored mainly in the breech, so employers have access to all the illegals they want for unskilled jobs. But they're still technically illegal, and living under a shadow, so they're paranoid about "the authorities" and view their boss as a protector. So it's unlikely they'll stick their necks out by trying to organize. Bush's guest-worker proposal essentially ratifies this state of affairs, turning them into peons whose continued stay in this country depends on maintaining the employer's good will.

Josh and Martin,

Well, Scrooge himself expresses a favorable view of the workhouses and prisons as a way of warehousing the destitute. And I can't remember for sure whether Christmas Carol is set post-1833 or not, but I suspect Scrooge would have qualified for the very tiny electorate.


I love it! Did Santa have angular cheekbones and piercing blue eyes, and smoke a lot?

December 24, 2005 9:15 AM  
Anonymous Anonymous said...

There's another, slightly more sophisticated, Scrooge screed at Lew Rockwell's site for 24-25.12.05, this time by Butler Shaffer.

People might be interested to look at http://en.wikipedia.org/wiki/Turnip_%28Brassica_rapa%29 which I just stumbled across. The history part shows a similar perspective. It appears to be drawn from some older text, possibly the 1911 Encyclopaedia Britannica though unusually this isn't acknowledged. Remember, it is entirely accurate, merely lacking in some context.

In a similar way, we should remember that the Warsaw Ghetto was a good thing compared to the available alternatives. It's merely a materially incomplete description.

December 25, 2005 3:38 AM  
Anonymous Anonymous said...

Here's a libertarian-case-against-Scrooge piece I wrote about a decade ago.

December 26, 2005 12:06 AM  

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