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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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Sunday, January 08, 2006

Varieties of Voluntary Economy

Roderick Long links to an excellent article by Philip E. Jacobson: "Three Voluntary Economies"

A free nation is not necessarily a Capitalist nation.... In the United States, libertarians tend to associate the idea of an economy based on voluntary relations with cash-based, for-profit enterprises. Other voluntary economic relations are possible. In addition to enterprises based on private monetary profit, there are at least two others which do not use this approach. one is the system based on charitable donations, usually of cash. The other is the system based on the charitable donation of labor....

Organizations which portray themselves in loudly ideological terms often give special praise to one of the three types of economy. Yet they may benefit predominantly from participation in one or both of the other types. The former Soviet Union extolled the virtues of collective enterprise, a labor charity system where the labor and the beneficiaries were the same community. It also praised charitable contributions across international borders. Yet much of its international economic activity was conducted as if it were one large cash-for-profit enterprise, even when it dealt with other "socialist" nations. Many religious organizations emphasize the virtues of giving and present themselves as cash charity organizations. Yet they often maintain substantial investments in cash-for-profit enterprises used (among other things) to provide luxurious living accommodations for their leaders. The Libertarian Party of the United States argues that the vast majority of economic functions should be performed by cash-for-profit enterprises. Yet it is organized primarily as a labor charity and to a lesser extent as a cash charity. Its cash-for-profit activities are negligible and of very limited success....

Both cash charity and labor charity enterprises can engage in the sale of goods and services on the open market. They may behave as cash-for-profit enterprises when dealing with these customers, though the profits may go to philanthropic activities like feeding the poor or supporting medical research. Enterprises which are clearly cash-for-profit in their general operations may make substantial contributions as cash charity enterprises. At times these contributions may be made as guarantees to the buyer of goods or services (i.e., "ten cents from every dollar purchase goes towards xxx charitable fund")....

It is difficult to predict which social factors would encourage which type of economy in the absence of initiated force....

All libertarians should be tolerant of enterprises using any of the three voluntary economies. It is a fine thing to discuss and praise one's favorite, especially as an alternative to coercive systems. And a certain amount of rivalry among the three types is to be expected, even encouraged, in a free society. But advocates of each type should not adopt overly chauvinistic positions. At a time when the greatest threat to prosperity is the encroachment of coercive systems on the free associations of individuals, all libertarians should rejoice at the success of any enterprise based on voluntary relations.

Brad Spangler has an interesting discussion of Jacobson's use of the term "capitalism," contrasting it with both the Austrian usage and my own. As he wrote in an earlier post,

Those who investigate that idea of private law and private security in only a shallow sense, however, often wind up with the mistaken impression that anarcho-capitalists are obsessed with money and business. In actuality, we’re obsessed with non-aggression. Any non-aggressive option that people freely choose and is found by them to meet their needs is by definition a market solution....

As the for-profit business model is only one form of organization that people might choose to use, it’s entirely possible, and likely in fact, that an anarcho-capitalistic society would at least somewhat (and perhaps largely) incorporate other models of voluntary organization — even in the law and security industries. The point is that if people are going to truly be free, then you can’t lay down some “blueprint for anarchy” that will be followed to the letter.

Compare that to Karl Hess' statement in Libertarian Forum:

Libertarianism is a people's movement and a liberation movement. It seeks the sort of open, non-coercive society in which the people, the living, free, distinct people may voluntarily associate, dis-associate, and, as they see fit, participate in the decisions affecting their lives. This means a truly free market in everything from ideas to idiosyncrasies. It means people free collectively to organize the resources of their immediate community or individualistically to organize them; it means the freedom to have a community-based and supported judiciary where wanted, none where not, or private arbitration services where that is seen as most desirable. The same with police. The same with schools, hospitals, factories, farms, laboratories, parks, and pensions. Liberty means the right to shape your own institutions. It opposes the right of those institutions to shape you simply because of accreted power or gerontological status.

In other words, the cooperative, the barter association, and the mutual aid society are at least as much free market institutions as the capitalist corporation--and probably a damned sight more so.


Anonymous Anonymous said...

They're all market institutions - capitalist corporations, mutual aid societies, and market syndicates. I would expect a free market society to have them all.

- Josh

January 10, 2006 5:02 AM  

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