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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

Wednesday, May 31, 2006

Fish! Philosophy: The Beatings Will Continue Until Morale Improves

From a discussion board comment, by someone who experienced the manipulative essence of Fish! Philosophy firsthand. I added paragraph divisions to make it more readable in blog format.

The Fish program, or "Fish philosophy" was supposed to change the way employees view their jobs, and therefore their performance and happiness in the workplace.

My experience with it was exactly the opposite. Between last July and April, three women in my department had heart attacks at work. Others had gone on stress related disability. Overtime was abolished and no hiring was done to replace people who were leaving by the truckload. Morale was non-existent; people were in a position where they hated their jobs, and frustrated over needing the jobs they hated so much. And through all of this, the pressure to produce more and more profits for shareholders was steadily being ratcheted upward.

That's where the whole Fish thing came in. "The beatings will continue until morale improves." We were shown the video and pretty much ordered to start having fun. We were dragged into meetings where ideas were demanded from us on how to make our workplace fun. No one had a clue, and the evidence came from the kinds of suggestions that my co-workers were coming up with. Some examples: crazy pants day, crazy hat day, wear your clothes inside out day, and snack/potluck days. My favorite useless idea was this one: everyone in my department was given a small safety pin. The first one to hear another employee make a negative comment was entitled to take that employee's pin. At the end of two weeks, the employee with the most pins won a prize: one hour of paid time off. In a testament to how well these ideas were working, the third of the heart attacks at work I mentioned happened while this was all going on.

After it was clear that none of these ideas was working, I was asked by my manager to come up with something, since I had a reputation for being apart from the crowd and looking at everything in a different way than everyone else did. I was told that I would be giving a presentation at the next staff meeting.

My talk had to do with how little chance I thought we had of making the Fish philosophy work. I pointed out that we couldn't be forced to have fun, we had to be allowed to. Any idea that had the word "day" in it was pointless[;] the next day things would be back to normal. Changing how we viewed our jobs had to come from the inside, and couldn't be imposed from outside. Management would have to revise unrealistic standards and allow us to find our own meanings in our work. That profit motive kills everything it touches if people aren't seeing any benefit. We had to see tangible (especially spendable) benefits from our work. Making a living, providing for families, and having funds to finance retirements and educations for children were the reasons we were there. We would love to have fun with our work, and would, if we were just allowed to.

I was put on probation shortly afterward and terminated several weeks later. I looked forward to being terminated the same way a long-term terminally ill patient welcomes death....

My management theory was simple. The tone of the corporation is set at the top. Communication can't be limited to only that which comes from the top down. People want to be proud of their work and who they do it for. People have to be allowed to feel there is a point to how they spend their lives, and allowed to share in the fruits of their labors. Our management should have set up a situation in partnership with us instead of an adversarial one. And, as the saying goes, a fish rots from the head down.

--Jon Glissando - Gary, IN, USA

Sunday, May 28, 2006

Vache Folle on Fish! Philosophy and "Negativity"

The mega-church preacher and author Joel Osteen, whose soporific and mesmerizing voice is almost irresistible, preaches joyful obedience. I sometimes catch Osteen as I am channel surfing, and I find him fascinating. I do a pretty good Osteen impression, if I say so myself. If I remember right, he preached this weekend: “You don’t have to go [to] work; you get to go to work.” He had a whole litany of things that we should be grateful for and see as privileges rather than burdens. Mrs Vache Folle piped up with her addition: “You don’t have to have head lice; you get to have head lice.”

On one level, Osteen is right. We should be less ungrateful and more appreciative of our many blessings. We should make the best of our situation until we can change it. But it is too easy to fall into the trap of condemning all criticism and complaint and discontent as subversive and selfish.

I recall Bill Gothard's program in my youth in which I was instructed that any unhappiness I felt was a manifestation of selfishness, that I was responsible for my own feelings and should neither complain nor try to change things. My own pastor used the word "bullshit" to describe how he felt about this teaching.

In the West Indies, folks often referred to the concept of “negativity” as something that impeded progress. It was “negativity” that caused initiatives to fail, and one could sometimes successfully shut down criticism by playing the “negativity” card.

Incidentally, I wonder why it is that management is (implicitly) exempt from all the new-agey "just accept it and get your head in the right place" vibes of Fish! Philosophy. When they send down an angry memo about this or that aspect of how we do our work being unacceptable, why don't we get to tell them "Hey, you can't do anything about the way we do our jobs, but you can choose your attitude toward it"? The answer, obviously, is that we're dealing with a one-way power relationship. They're the ones who get to make "change"; we're the ones who have to "deal with it." They don't need to have a "good attitude" toward the bad shit that's done to them, because they're the ones doing all the bad shit to other people. That's why there's such a close correlation between the appearance of those first Fish! banners and the beginning of downsizing, layoffs, and other unpleasantness. When you see a Fish! Philosophy banner, it's like being told you've got "a real purty mouth": a sign that something really unpleasant is about to follow.

Also incidentally, it's a pretty jarring effect to see all those "don't worry, be happy" Fish! banners all over the place combined with the general atmosphere of fear, reminiscent of a Stalinist purge, that accompanies an open-ended period of layoffs. It's kind of Twilight Zonish: "It's good that management did those horrible things--it's real good!"

Thursday, May 25, 2006

Net Neutrality

I've pretty much stayed out of the "net neutrality" debate because I'm so unqualified to write on such issues. I do have an instinctive reaction against "public good" arguments for equal access without regard to paying for the bandwidth one consumes, as indicated by a previous post. And I found this anti-net neutrality article by Julian Sanchez pretty helpful for a tech dummy like me: "A Neutral Panic: Why there's no need for new laws to keep the Internet open."

Of course, just from my vague layman's impression of the debate, I think there's probably a distinction to be made between cost-based pricing and corporate enclosure of the Web. There's probably some way to combine control of service delivery by content producers with market pricing of services. And here's something worth considering on the other side (via A.E. Lewis on the Distributism yahoogroup). I'd appreciate any comment from readers more tech savvy than I am--which is probably most of you.

You've Already Paid $2,000 For A Fiber Connection You'll Never Get

from the money-back,-please dept

As the Baby Bells falsely complain about how people aren't paying them for the internet, or whine about how it's unfair to expect them to compete against muni-broadband, there's something important to remember. For the last decade, those same telcos have made promise after promise to local governments concerning the delivery of truly open fiber optic connections to the home. In exchange, they've been granted all sorts of privileges and rate increases by the government, costing all of us money. And where did the money go? Not towards what was promised. Bruce Kushnick, who we've written about before is now coming out with a book [$200 Billion Broadband Scandal] that details how the telcos scammed approximately $200 billion from all of us (about $2,000 per household), promising fiber to every home with symmetric 45 Mbps speeds and an open access model that would allow anyone to offer competitive internet services over that connection. This is a promise that they have not kept... though, they have kept our money. That fiber was supposed to be delivered this year (earlier in other cases), but it's not coming. The fiber that telcos are finally starting to offer is much more expensive, much slower, and locked down.

What's Good for the Goose...

Brad Spangler writes:

To accept that the state is banditry but simultaneously deny that the poorest among us are undoubtedly among those who have been stolen from the most (in one fashion or another) is not rational.

Against that backdrop, libertarians ought to re-evaluate their historic hostility to labor organizing. In a genuinely free market, all would rightfully have the opportunity to seek and negotiate the best deal for themselves and their associates that they can. If whatever price the market will bear is good for the plutocrat, it’s just as good for the worker negotiating wages. Personally, I’m proud to be a dues paying IWW member.

I recall seeing a lot of tsk-tsking from Paul Birch and others of like mind in some discussion forum several months back, about what blackguards union workers were for demanding higher wages when their labor was most needed. Golly, aren't these the same people who defend "price gouging" by the oil companies?

Here's what I think it boils down to. For Nixon and Bush, "when the President does it it's not illegal." And for vulgar libertarians, when big business and the rich do it it's OK. In response to someone who said it was perfectly rational for a worker to see how much pay he could get for the least work, Birch replied in offended tones that it might be rational to steal, too, or something to that effect.

Well, before we put "employers" on too high a pedestal, let's consider this quote from a vice president of PR at General Motors (in David M. Gordon's Fat and Mean):

....We are not yet a classless society.... [F]undamentally the mission of [workers'] elected representatives is to get the most compensation for the least amount of labor. Our responsibility to our shareholders is to get the most production for the least amount of compensation.

And here, from the same source, is an advertising blurb from a union-busting consulting firm:

We will show you how to screw your employees (before they screw you)--how to keep them smiling on low pay--how to maneuver them into low-pay jobs they are afraid to walk away from--how to hire and fire so you always make money.

That kind of honesty is quite refreshing, after all the smarmy Fish! Philosophy shit I've been wading through lately.

I know, I know, I've read Economics in One Lesson. I'm familiar with the argument that "in a free market" wages are determined by productivity. I've also seen, in the real world, real wages that have remained stagnant or even fallen slightly since the 1970s, as the real GDP nearly doubled. That brings to mind a quote from Mises:

If a contradiction appears between a theory and experience, we must always assume that a condition pre-supposed by the theory was not present, or else there is some error in our observation. Thedisagreement between the theory and the facts of experience frequently forces us to think through the problems of the theory again. But so long as a rethinking of the theory uncovers no errors in our thinking, we are not entitled to doubt its truth. [Epistemological Problems of Economics]

When the theory predicts that in a free market wages will be determined by the productivity of labor, and we see that they aren't, what's the obvious conclusion? That we're dealing with power relations, not market relations.

Monday, May 22, 2006

"The High Cost of Developing Drugs"

My last post on patents led to an interesting exchange between a couple of regular readers taking opposite views of the subject: Joshua Holmes, a frequent contributor to No Treason, and quasibill, an apparent former drug industry insider who often weighs in against Ron Bailey's (stipulation--unpaid) cheerleading for Big Pharma at Reason Hit&Run.

Josh made the point that new food recipes, with relatively low development costs, were hardly typical of product innovation. Quasibill, in response, provided some new and (for me at least) mind-blowing information on just why the cost of developing new drugs is so high. I was aware that the FDA testing regime added considerably to the cost--not only its excessively stringent safety testing requirements, but its requirement since the 1960s of testing for efficacy. And I understood that such regulatory inflation of costs served as a market entry barrier, effectively cartelizing the drug industry between a handful of highly capitalized firms. What I didn't realize was just how much of the cost comes, not from testing specific drugs, but from gaming the patent system: i.e., testing a spectrum of related drugs in order to secure patent lockdown on alternative versions of the same drug, and thus forestall competition.

What generally gets included in the accounting for research costs are some amazing things, that I can't do justice to on a blog - I get surprised everytime I talk to my friends in the industry about how much waste is involved - but it's all invisible to them. It's just "how it needs to be for the FDA to keep track of everything." If you want, I can give you some examples, but I'd rather focus on another point for now -

Namely that what big pharma is researching is cancer meds. It's not. In the rare instances that big pharma produces and markets such medicines, it has purchased them from small start-ups that themselves are the result normally of a university laboratory's work. When big pharma cites to billions of research costs, what it is talking about is the process whereby they literally test millions of very closely related compounds to find out if they have a solid therapeutic window. This type of research is directly related to the patent system, as changing one functional group can get you around most patents, eventually. So you like to bulk up your catalogue and patent all closely related compounds, while choosing only the best among them, or, if you're second to market, one that hasn't yet been patented.

This work is incredibly data intensive, and requires many Ph.D's, assistants, and high powered computers and testing equipment to achieve. But it is hardly necessary in the absence of a patent regime. In the absence of patents, (and of course the FDA), you could just focus on finding a sufficient therapeutic window, and cut out the remaining tests. It would be an issue of marginal costs to determine whether someone would go to the effort to find a "better" therapeutic window, or related parameter.

So the "high cost of developing drugs" is really the high cost of maintaining a monopoly against potential competitors pursuing similar lines of research. Think of that the next time you see one of those smarmy, soft-lit Glaxo or Pfizer ads with the elevator music in the background, where some biochemist gets all teary about her Alzheimer's-afflicted grandma.

Sunday, May 21, 2006

Intellectual Property Stifles Innovation

Jonathan Rowe, at On the Commons.

Here in the Philppines, no one owns the idea of pansit which is a kind of noodle dish, or of skewered chicken, or of shucked corn roasted on a street corner. These are part of a food culture; and according to our leading economic lights, they should therefore stagnate into a culinary puddle of lassitude and waste. Who would improve that which they do not own?

Well, it turns out lots of people will. There is pansit and roasted corn and a multitude of soups and stews that I forget the names of on just about every corner -- just as, in the U.S., the common ownership of pizza and moo shu pork has not deterred countless restaurant owners from concocting their own versions of these. To the contrary, it is in the culinary commons that invention is most alive. I can treat you to a lot more varieties of moo shu in San Francisco than I can varieties of a Big Mac. That is because there are no varieties of Big Macs. The corporate property regime has frozen it in place, to change only when a hulking legal and marketing bureaucracy permits.

Friday, May 19, 2006

Managing, Somehow, to Survive Without Parasites

Via Mark Monson's LVT News Digest, a regular feature on the Land Theory yahoogroup. Damien Ochiel, Mbaratho Mulago, writing in the Kenya Times:

Six thousand people. Five clinics. Two primary schools. Two churches. An endless string of clubs.

Two supermarkets. Five storyed buildings. A booming construction industry.

Four petrol stations, one casino with live entertainment, a cyber café, photocopying centres.

No slums. No beggars. No street children. No banks.


As recently as 1984, this bustling trading centre in Mavoko Municipality was a mere expanse of African bush on a narrow strip of land approximately 50 by 1,000 metres between the old and the new alignment of the Mombasa road, some 15 km from Nairobi city.

In the mid 1980s, crafty sand traders from Machakos district, some 30 km further east, found that by dumping their lorry loads along the old alignment of the Mombasa road, not more than 50m from the new one, they avoided the weighbridge charges....

Soon after the sand trade begun, the first shops started appearing. They mostly sold food and drink, but in no time other services were provided for: tailors, clinics, a locksmith, shoemakers. It did not take long before wooden shacks gave way to stone and cement buildings. By 1990, Mlolongo was booming, while officially continuing not to exist.

Even today, it is useless to try to locate Mlolongo on a map. An interesting phenomenon is that neither politicians nor street preachers, not even NGOs, find a ready audience in a fully employed population. And the inhabitants do not look forward to having such operators in their midst.


Henry George (1839-97) used to say, capitalist A and worker B do not divide between themselves the wealth produced by B. They divide what is left to them after landowner C rakes in his rent, usurer D his interest, tax collector E his extortions, and a whole line of parasites from F to Z their more or less visible cuts.

It is evident that the Mlolongo dwellers avoid, or evade, some of that. Not all, for sure, otherwise the place would not differ much from an earthly paradise. A tentative, necessarily incomplete, analysis follows.

What strikes a visitor first is the difference between the north side of the new Mombasa road where Mlolongo lies, and the south, which spots a few buildings and a vast expanse of undeveloped savannah. The difference is land speculation.

Land is not free on either side of the road, but the system of tenure is leasehold in the North and freehold in the South. Result: the lease price paid to the Mavoko Municipality would be wasted by anyone not developing the land paid for.

Hence the booming construction.On the south side, the landowner sits on his daily appreciating but empty property, unwilling to sell and waiting to make a kill.

The perverse system of taxation that Kenya has inherited from the British rewards the idle landowner’s sloth, while punishing the working people’s industry. The perversion consists in the fact that the value of the idle property increases by the day not because of what its owner does, but because of what the people on the other side of the road do.

If the attention of tax collector E was diverted away from the fruits of Mlolongo people’s labour towards the immoral (but legal) earnings of that representative of class C, Mlolongo would take off economically way beyond the dreams of every academic economist....

The absence, or inconspicuousness, of so many eaters of labourers’ wages goes a long way to explain the unusual prosperity of Mlolongo, but it does not mean that people there wallow in opulence. There is no poverty in the sense of destitution, but wages are low. The population is big enough to have attracted there the power company. It has connected the place to the national grid, but since the water supply is a municipal monopoly, they are still without water. Every family needs 40 litres a day, which they buy from vendors at 2 shillings a litre.

And there is no sewerage system. Every shop-cum dwelling space owner has built his own septic tank under the property, but in the outlying areas north of the road, there are still open sewers waiting to be dealt with. Somehow.

Thursday, May 18, 2006

Mutualist Political Economy In--About Friggin' Time

The shipment of Studies in Mutualist Political Economy finally arrived from the printer, and I mailed out the back orders today. My sincere apologies to those who have been inconvenienced by the long wait, and many thanks for your patience.

I've been looking into Lulu and Amazon Booksurge, among other on-demand publishers, in hopes of preventing any more headaches in the future. Anybody out there have any recommendations?

Agribusiness and the State

Three items:

1) Via Stanley Dagnal Rowe, Jr. A great article by Joel Salatin of Polyface Farm: "Everything I Want to Do is Illegal."

I want to dress my beef and pork on the farm where I’ve coddled and raised it. But zoning laws prohibit slaughterhouses on agricultural land. For crying out loud, what makes more holistic sense than to put abattoirs where the animals are? But no, in the wisdom of Western disconnected thinking, abattoirs are massivecentralized facilities visited daily by a steady stream of tractor trailers and illegal alien workers.

But what about dressing a couple of animals a year in the backyard? How can that be compared to a ConAgra or Tyson facility? In the eyes of the government, the two are one and the same. Every T-bone steak has to be wrapped in a half-million dollar facility so that it can be sold to your neighbor. The fact that I can do it on my own farm more cleanly, more responsibly, more humanely, more efficiently, and in a more environmentally friendly manner doesn’t matter to the government agents who walk around with big badges on their jackets and wheelbarrow-sized regulations tucked under their arms.

OK, so I take my animals and load them onto a trailer for the first time in their life to send them up the already clogged interstate to the abattoir to await their appointed hour with a shed full of animals of dubious extraction. They are dressed by people wearing long coats with deep pockets with whom I cannot even communicate. The carcasses hang in a cooler alongside others that were not similarly cared for in life. After the animals are processed, I return to the facility hoping to retrieve my meat. When I return home to sell these delectable packages, the county zoning ordinance says that this is a manufactured product because it exited the farm and was reimported as a valueadded product, thereby throwing our farm into the Wal-Mart category, another prohibition in agricultural areas. Just so you understand this, remember that an onfarm abattoir was illegal, so I took the animals to a legal abattoir, but now the selling of said products in an on-farm store is illegal....

What does the Organic Trade Association have to fear from me using the “O” word?
If society really wants government certification, my little market share will continue to deteriorate into oblivion. If, however, the certification effort represents a same-old, same-old power grab by the elitists to exterminate the fringe players, it is merely another example of fear replacing faith.

This doesn't fall under the heading of regulatory restrictions on small-scale agriculture, but it deals with another theme I've touched on: raising the threshold of subsistence by crowding out or prohibiting the means of comfortable poverty.

You would think that if I cut the trees, mill the logs into lumber, and build the house on my own farm, I could make it however I wanted to. Think again. It’s illegal to build a house less than 900 square feet. Period. Doesn’t matter if I’m a hermit or the father of 20. The government agents have decreed, in their egocentric wisdom, that no human can live in anything less than 900 square feet.

Our son got married last year and wanted to build a small cottage on the farm, which he now oversees for the most part. Our new saying is, “He runs the farm, and I just run around.” The plan was to do what Mom and Dad did for Teresa and I — trade houses when children come. That way our empty nest downsizes, and the young people can upsize in the main family farmhouse. Sounds reasonable and environmentally sensitive to me. But no, his little honeymoon cottage — or our retirement shack — had to be a 900-square-foot TajMahal. A state-of-the-art accredited composting toilet to avoid the need for a septic system and sewer leach field was denied.

2) Via Steve Bryant, by email. An interesting review at Monthly Review of The Conquest of Bread, by Richard A. Walker (a history of agribusiness in California):

Popular wisdom has it that the success of agriculture in California springs from the natural abundance of the state’s Mediterranean climate and alluvial soils. But an argument made popular by Marc Reisner, in Cadillac Desert, and menacing in Roman Polanski’s film noir Chinatown, holds that the motor behind California’s growth has been the massive federal and state water projects that have diverted millions of gallons of water to irrigate the fields of California’s farmers. The munificence of nature and bounteous irrigation have undoubtedly ratcheted up the level of dynamism of California’s agriculture, contends Walker, but neither has been the catalyst for it. Water in particular lacks explanatory power as the driving force behind the state’s double-edged vitality since irrigation projects were not in the forward guard of the growth of California agriculture, but trailed behind it.

Agrarian capitalism and the dynamism of the region, Walker argues, have been undergirded by the twin commodification of land and labor—that is, the transformation of nature and human activity into objects that could be bought and sold on the market. Following California’s annexation by the United States, Gold Rush–engorged speculators grabbed large tracts of the countryside, by expelling Native American tribes from their land, snapping up property from Mexican rancheros, and benefiting from the largesse of the privatization of federal lands. Within a generation, land could be exchanged on the market without constraint.

Labor in California was turned into a commodity through a process which Marx, borrowing from Adam Smith, termed “primitive accumulation.” American Indians who had been peons or hunter gatherers were now turned into “free” wage workers to toil on the farms of California’s new capitalists. Toward the end of the nineteenth century, California moved from production of grains, garden crops, and cattle grazing, to a revolution in horticulture, growing a plethora of oranges, lemons, apricots, almonds, and figs. Large numbers of workers were needed in the orchards at harvest time and recruiters rounded up U.S.-born and immigrant workers, poor town dwellers and footloose fruit tramps, in order to ensure a glut of labor and pittance wages.

The dawn of wage labor did not preclude growers from harnessing unfree labor under fully capitalist conditions, as with the notorious bracero program. An arrangement put in place during the Second World War, the bracero program institutionalized a form of indentured labor in which more than four million Mexicans were brought to the United States to work as farm laborers stripped of the freedom to leave employers. It was eventually abolished in 1964, after having lowered farm wages and given capital accumulation a large shot in the arm, but it illustrated the very active role of the state as a handmaiden of the interests of agrarian capitalists in procuring cheap, yoked labor.

Walker maintains that the process of “primitive accumulation” is not a one-off phenomenon in the transformation of pre-capitalist social relations to full-blown capitalism, but rather a continuous process that partially accounts for the weakness of the labor movement in California. Growers and processors have depended on successive waves of dispossessed or foreign workers—Native Americans, Basques, Chinese, Japanese, Italians, Portuguese, Mexicans, Punjabis, Mixtecans, Hmong, and Vietnamese—many of whom are later deported and replaced by new immigrants. Such a strategy undermines the ability of workers to build alliances and unify themselves as a conscious class....

As Walker makes clear, in its one hundred and fifty year history, California never was the domain of family farmers, but instead was characterized by large landholdings from the time of the Gold Rush.

3) at Counterpunch, "Corporate Agriculture's Dirty Little Secret," by Al Krebs:

To begin with the question needs to be asked who really are "illegal" immigrants on mostly territory that now comprises one third of the U.S. land mass and which in fact belonged to Mexico prior to the Treaty of Guadalupe Hidalgo of 1848 ?

Here was land literally stolen from the Mexican people by a handful of thievish land barons in what the famous land reformer Henry George once described as "a history of greed, of perjury, of corruption, of spoliation and high-handed robbery for which it would be difficult to find a parallel."

The long-term consequences of such action was that in the words of Ernesto Galarza, author of the classic Merchants of Labor, the Treaty left "the toilers on one side of the border, the capital and the best land on the other."

Therefore, it is no accident that throughout U.S. history the chronic areas of rural poverty have remained the South, where the plantation system has dominated the agricultural scene, and the Southwest, where the vast tracts of productive land have remained in the hands of a privileged few through the years.

During those years these large growers have developed the mistaken notion that the nation and our government should provide them with a cheap, unorganized work force.

With such initiatives as the bracero program, originally passed by the Congress during World World II as an emergency manpower act and which remained in place until 1964 before it was terminated, and in recent years so-called "guest worker" programs, corporate agribusiness has managed to hoodwink politicians and the public into thinking that unless these programs were continued our crops would rot in the fields.

This same thinking also motivated the large meat and poultry slaughter houses in the Midwest beginning in the late 1960's, to aggressively and promote the idea that they too should be entitled to the "the slaves we rent."

Wednesday, May 17, 2006

Inmates Running the Asylum?

Rad Geek quotes Richard Posner on the late difficulties of Harvard President Lawrence Summers. Posner takes the recent victory of uppity faculty over a university administration as the segue to a general denunciation of worker cooperatives:

To appreciate the sheer strangeness of the situation, imagine the reaction of the CEO of a business firm, and his board of directors, if after the CEO criticized one of the firm’s executives for absenteeism, ascribed the underrepresentation of women in the firm’s executive ranks to preferences rather than discrimination, dealt in peremptory fashion with the firm’s employees, and refused to share decision-making powers with them, was threatened with a vote of no confidence by the employees. He and his board would tell them to go jump in the lake. But of course there would be no danger that the employees would stage a vote of no confidence, because every employee would take for granted that a CEO can be brusque, can chew out underperforming employees, can delegate as much or as little authority to his subordinates as he deems good for the firm, and can deny accusations of discrimination.

If, however, for employees we substitute shareholders, the situation changes drastically. The shareholders are the owners, the principals; the CEO is their agent. He is deferential to them. Evidently the members of the Harvard faculty consider themselves the owners of the institution.

They should not be the owners. The economic literature on worker cooperatives identifies decisive objections to that form of organization that are fully applicable to university governance. The workers have a shorter horizon than the institution. Their interest is in getting as much from the institution as they can before they retire; what happens afterwards has no direct effect on them unless their pensions are dependent on the institution’s continued prosperity. That consideration aside (it has no application to most professors’ pensions), their incentive is to play a short-run game, to the disadvantage of the institution—and for the further reason that while the faculty as a group might be able to destroy the institution and if so hurt themselves, an individual professor who slacks off or otherwise acts against the best interests of the institution is unlikely to have much effect on the institution.
Uh, yeah. I've seen the amazingly long time horizons of senior management at some of the places I've worked. "Who cares if the ship goes down, as long as the worker bees locked in steerage drown first and we're sittin' pretty on the observation deck!" "Let's burn the place to the ground and sell it for charcoal to inflate the quarterly earnings report, and then cash in our stock! Woo hoo!"

Rad Geek comments:

Posner’s right that when it comes to operations like Harvard, workers generally have a shorter horizon of interest than the institution that they work for. There’s nothing wrong with pointing out the temptations that this creates. There is something wrong with passing this off as a problem that’s unique to workers (industrial, professional, or otherwise), or claiming that this kind of organizational problem is somehow solved by ditching co-operative models in favor of an organizational hierarchy.

When institutions are hundreds of years old and designed to last into the indefinite future, everyone has horizons shorter than those of the institution. This is not just true of workers; it’s true of shareholders, trustees, clients, executives, and all other mortal human beings.

Roderick Long also observed in the comments that

the separation between labour and management creates knowledge problems and incentive problems. Sure, there will no doubt be cases where such separation works better, and market competition will help identify such cases, but traditional management structures need to face more competition from the bottom-up alternative.

As I commented myself on that thread, Posner confuses cause and effect. Workers have a short time horizon because they have no say over how things are run. They deal with the consequences of other people’s stupidity (namely, those above them) and don’t fully internalize the benefits if they work harder or find ways to make the process more productive.

I suspect the European serf and the southern slave also had “short time horizons.” Imagine that.

But when workers do have a reason to be interested in improving the work process, they usually have a far better idea of what needs to be done than management does. Posner should read Hayek on what he called "distributed idiosyncratic knowledge."

Barry Stein (Size, Efficiency, and Community Enterprise) had some important things to say about the unique competence of those actually engaged in the production process. Most innovation, he wrote, is the cumulative effect of lots of incremental process improvements. And the people most qualified to identify opportunities for such improvements are, obviously, those involved in the process. In the hierarchical corporation, those most aware of what would improve efficiency have the least power to do anything about it. And, frankly, they also have very little incentive, since any productivity increases resulting from their improvements will surely be followed by layoffs, soaring stock prices, and senior management awarding itself a huge bonus for “cutting costs.” What worker in his right mind would do something to help his worst enemy?

By the way: as Paul Goodman pointed out in The Community of Scholars, many universities of the High Middle Ages arose as cooperative institutions controlled either by the faculty or the students. The latter model, as it developed at Bologna, was described by Roderick Long in "A University Built by the Invisible Hand."

Stephen Pearl Andrews Texts Online

Kenneth Gregg has finished posting his online text of Stephen Pearl Andrews' Science of Society, with Part II--Cost the Limit of Price--now up and running.

And Shawn Wilbur http://libertarian-labyrinth.blogspot.com/ has found (at Google Books) an online text of Andrews' The Basic Outline of Universology: An Introduction to the Newly Discovered Science of the Universe....

Tuesday, May 16, 2006

Front Porch Anarchists

Bill Kauffman's got a group blog, Reactionary Radicals, to promote his book Look Homeward America: In Search of Reactionary Radicals and Front Porch Anarchists. One of the contributors is Reason magazine's Jesse Walker, who is apparently the token transhumanist libertarian Titan colonist in the house.

My favorite post so far is by Dan McCarthy:

I was a junior at Washington University in St. Louis when the November 1998 issue of Chronicles — I was a new subscriber — arrived in my mailbox. “Reactionary Radicals,” the cover proclaimed, beneath a picture of two peasants pulling back the hands of a great clock. (And as the free-market anarchist Murray Rothbard used to say, if we can’t turn back those hands, “We shall break the clock of Woodrow Wilson’s New Freedom and perpetual war. We shall repeal the twentieth century.”)

Inside was Bill Kauffman’s tribute — now collected in Look Homeward, America — to Dorothy Day and the Catholic Worker movement, which related the story from Confessions of an Original Sinner of how John Lukacs reacted to Henry Kissinger putting in an appearance at National Review’s 25th anniversary bash. Lukacs asked himself who the real conservative was: the saintly Day, recently deceased, or the ghastly Kissinger? While the rest of the assembled worthies applauded Nixon’s consigliere, Lukacs booed.

After reading that, I knew I would never be fit for service in the conservative mainstream again. And thank God.

Definite runner up, though, is this classic quote from Smedley Butler, included in a Clark Stooksbury post:

I helped make Mexico and especially Tampico safe for American interests in 1914. I helped make Haiti and Cuba a decent place for the National City Bank boys to collect revenues in. I helped in the raping of a half a dozen Central American republics for the benefit of Wall Street. The record of Racketeering is long. I helped purify Nicaragua for the international house of the Brown Brothers in 1909-1912. I brought light to the Dominican Republic for American sugar interests in 1916. I helped make Honduras “right” for American fruit companies in 1903. In China in 1927 I helped see to it that Standard went its way unmolested . . . Looking back on it, I feel I might have given Al Capone a few hints. The best he could do was to operate his racket in three city districts. We Marines operated on three continents.

You may remember Bill Kauffman from such articles as "The Way of Love: Dorothy Day and the American Right," "My America vs. the Empire," and "Think Locally, Act Locally, Live Locally: Education on the Human Scale," or the books Dispatches from the Muckdog Gazette : A Mostly Affectionate Account of a Small Town's Fight to Survive and America First!: Its History, Culture, and Politics. He's also figures prominently, among assorted personages from the decentralist Left and Old Right, in the Vermont secessionist movement, Second Vermont Republic.

Sunday, May 14, 2006

Vulgar Libertarianism Watch, Part XVII

Cato Unbound recently promoted an essay by William Easterly, "Why Aid Doesn't Work," as an attempt to to "kick off" a blogospheric "conversation" on the issue.

Implicit in Easterly's essay is the assumption that "globalization" is the result of pro-market policies, rather than state intervention on behalf of transnational corporations:

Economic development happens, not through aid, but through the homegrown efforts of entrepreneurs and social and political reformers. While the West was agonizing over a few tens of billion dollars in aid, the citizens of India and China raised their own incomes by $715 billion by their own efforts in free markets.

Silly me. I thought China had encouraged foreign investment through corporate welfare, like expropriating village land for industrial parks, and sweatshop-friendly labor policies, like forcible suppression of independent labor unions.

Easterly also implicitly assumes that the kind of "structural adjustment" demanded by the Bretton Woods agencies is equivalent to "free market reform":

Dozens of “structural adjustment” loans (aid loans conditional on policy reforms) made to Africa, the former Soviet Union, and Latin America, only to see the failure of both policy reform and economic growth. The evidence suggests that aid results in less democratic and honest government, not more.

In fact, as I've repeatedly argued (see, for example, "The Neoliberal Myth of Small Government"), most of the "reforms" pushed by the IMF and World Bank are just warmed-over state capitalism.

Take so-called "privatization," for example. Here's how Sean Corrigan, a columnist at LewRockwell.Com described the process a few years ago:

Does he [Treasury Secretary O'Neill] not know that the whole IMF-US Treasury carpet-bagging strategy of full-spectrum dominance is based on promoting unproductive government-led indebtedness abroad, at increasingly usurious rates of interest, and then--either before or, more often these days, after, the point of default--bailing out the Western banks who have been the agents provocateurs of this financial Operation Overlord, with newly-minted dollars, to the detriment of the citizenry at home?

Is he not aware that, subsequent to the collapse, these latter-day Reconstructionists must be allowed to swoop and to buy controlling ownership stakes in resources and productive capital made ludicrously cheap by devaluation, or outright monetary collapse?

Does he not understand that he must simultaneously coerce the target nation into sweating its people to churn out export goods in order to service the newly refinanced debt, in addition to piling up excess dollar reserves as a supposed bulwark against future speculative attacks (usually financed by the same Western banks’ lending to their Special Forces colleagues at the macro hedge funds) - thus ensuring the reverse mercantilism of Rubinomics is maintained?

Joseph Stromberg, another Rothbardian free marketer, characterized most privatization as "funny auctions, that amounted to new expropriations by domestic and foreign investors...."

And as Nicholas Hildyard pointed out, the privatization is only nominal. It leaves a larger share of functions under nominally private direction, but operating within a web of protections, advantages and subsidies largely defined by the state:

While the privatisation of state industries and assets has certainly cut down the direct involvement of the state in the production and distribution of many goods and services, the process has been accompanied by new state regulations, subsidies and institutions aimed at introducing and entrenching a "favourable environment" for the newly-privatised industries.

As on the mark as these three critics are, there are a few points I'd add. First, the state assets to be "privatized" are often infrastructure, built with World Bank loans, whose main purpose was to make foreign capital investments profitable. Second, the debt acquired to build that infrastructure is used to blackmail the local government into adopting neoliberal structural adjustment "reforms" that include selling the same infrastructure, to the same politically connected international investors, for pennies on the dollar. Third, to entice foreign capital into buying the assets, the local government often has to spend more money to make them saleable than they get from the proceeds. Fourth, the new owners' first order of business is usually systematic asset-stripping, resulting in far more money than they paid for the "privatized" property. In other words, what we're really talking about is looting.

Easterly, finally, tosses around the generic term "aid" as though it referred mainly to aid to the poor (as Eric Cartman might say, "a bunch of tree-hugging hippie crap"), when in fact the majority of Western foreign aid and loans from multilateral financial bodies has been corporate welfare to Western corporations. The World Bank was created, originally, to subsidize the export of surplus capital. And the majority of its loans have been, as we saw above, for the transportation and utility infrastructure needed to make Western capital investments profitable. According to Gabriel Kolko's 1988 estimate [Confronting the Third World: United States Foreign Policy 1945-1980], almost two thirds of the World Bank's loans since its inception had gone to transportation and power infrastructure. A laudatory Treasury Department report referred to such infrastructure projects (comprising some 48% of lending in FY 1980) as "externalities" to business, and spoke glowingly of the benefits of such projects in promoting the expansion of business into large market areas and the consolidation and commercialization of agriculture [Dept. of the Treasury. United States Participation in the Multilateral Development Banks in the 1980s (GPO, 1982)].

So what kinds of genuinely free market policies could the West undertake to promote prosperity in the Third World? Here are a few, for starters:

1. Western governments should support genuine property rights in the land. That is, they should stop siding with the Latifundistas and other landed oligarchies against land reform, and support strengthening of the peasantry's traditional tenure rights in the land. The history of American foreign policy in the Third World, unfortunately, is pretty accurately symbolized by its intervention on behalf of United Fruit Company in Guatemala: decades of collusion between landlord and general oligarchies, American agribusiness interests, and the U.S. national security establishment. Murray Rothbard, a libertarian considerably less prone than the Catoids to confuse "property rights" and the "free market" with plutocratic interests, acknowledged that most "property rights" in the Third World were really what Thomas Hodgskin called "artificial" and Albert Jay Nock called "law-made" (see "Rothbard on Feudalism and Land Reform") Such property claims, descended largely from state grants of land under colonial regimes, came at the expense of the legitimate property rights of the peasants who had appropriated the land through their own labor.

One reason Third World labor is willing to work in sweatshops as their "best available alternative" is that they've been forcibly deprived of any better alternative. If the countless land expropriations of recent decades had not taken place, if the property rights of peasant cultivators had been upheld against quasi-feudal property rights based on state land grants to absentee landlords, if hundreds of millions of now landless laborers still had independent access to subsistence farming, the bargaining position of labor against Wal-Mart's suppliers would be considerably different. As was the case with the enclosures in Britain, employers find it a lot harder to get cheap labor when workers have independent access to the means of production. Some factual questions were recently raised about Ellennita Muetze Hellmer's JLS article "Establishing Government Accountability in the Anti-Sweatshop Campaign," but that shouldn't obscure the validity of her central point: it's disingenuous for sweatshop employers to congratulate themselves on providing crutches to destitute Third World laborers when they've colluded with government in breaking their legs in the first place.

2. Repudiate international "intellectual property" accords. The central motivation behind the GATT intellectual property regime was to permanently lock in the collective monopoly of advanced production technology by TNCs, and impede the rise of independent competition in the Third World. It would, as Martin Khor wrote, "effectively prevent the diffusion of technology to the Third World, and would tremendously increase monopoly royalties of the TNCs whilst curbing the potential development of Third World technology." The developed world pushed particularly hard to protect industries relying on or producing "generic technologies," and to restrict diffusion of "dual use" technologies. Not to put too fine a point on it, the aim of international "intellectual property" law is to lock the Third World into a permanent status of global sweatshop, hewers of wood and drawers of water for Western capital [Martin Khor, The Uruguay Round and Third World Sovereignty (Penang, Malaysia: Third World Network, 1990); Chakravarthi Raghavan, Recolonization: GATT, the Uruguay Round & the Third World (Penang, Malaysia: Third World Network, 1990)].

3. Replace the phony neoliberal version of "privatization" with the real thing--that is, privatization based on respect for the property rights of the taxpayers whose sweat equity is embodied in the assets. Murray Rothbard argued that state property should be treated as "unowned" in the Lockean sense, and subject to homesteading by those actually mixing their labor with it ["Confiscation and the Homestead Principle," Libertarian Forum June 15, 1969]. In the case of public utilities, that means organizing them either as producers' co-ops under the control of workers' syndicates, or consumer cooperatives owned by the ratepayers. All state property and services should, in some similar fashion, be returned directly to the people. The state has no right to sell, to its favored cronies, property that was originally paid for with money looted from the taxpayers.

4. More generally, the U.S. should abandon the Palmerstonian model of fake "free trade" for the genuine article, as conceived by Cobden. According to Oliver MacDonough ["The Anti-Imperialism of Free Trade," The Economic History Review (Second Series) 14:3 (1962)], the Palmerstonian system was utterly loathed by the Cobdenites. The sort of thing Cobden objected to included the "dispatch of a fleet 'to protect British interests' in Portugal," to the "loan-mongering and debt-collecting operations in which our Government engaged either as principal or agent," and generally, all "intervention on behalf of British creditors overseas" and all forcible opening of foreign markets. Cobden opposed, above all, the confusion of "free trade" with "mere increases of commerce or with the forcible 'opening up' of markets."

Real free trade policy, on the other hand, doesn't require multilateral bureaucracies like the WTO. It simply requires eliminating U.S. trade barriers, and allowing Americans to trade or invest anywhere they want to in the world on whatever terms they can negotiate--provided that they also internalize all costs and risks of doing business overseas, without the U.S. government subsidizing their operating costs, insuring them against nationalization by hostile governments, and suchlike. It's that simple.

Friday, May 12, 2006

Per Bylund: Building the Structure of the New Society Within the Shell of the Old

Or as he titles it, "A Strategy for Forcing the State Back."

This is sort of a follow-up to my previous post on Dmytri Kleiner's venture communism idea, since what they're talking about is so similar once you get past the surface ideological differences.

What I’m proposing is a mix of two somewhat known recipes that are really liberating in two distinctly different ways. The first recipe provides instructions for how to break free vertically through building a decentralized infrastructure for free communities avoiding the State and its centralized "solutions" altogether. The other recipe advocates breaking free horizontally through making use of one’s personal network of friends and colleagues, and doing business out of the State’s reach....

....You cannot win taking the State on mano a mano so why even bother? But it is quite possible to break free small-scale and doing it for yourself. I have no idea why libertarians seem to wish to liberate "the whole nation," instead of doing what’s best for yourself and your kin first....

What [the vertical strategy] means in real terms is to create local or neighborhood networks for self-reliance, where people in the vicinity get together to find ways to produce whatever is necessary for survival and a good life. It means creating local production facilities and markets with no effective State regulations and without the State’s knowledge.

Karl Hess discusses the enormous possibilities of this approach in his excellent but small book Community Technology. In the book, Hess discusses his own experience in creating local networks for creating free and independent neighborhoods through replacing State "services" with community technology and voluntarily partaking in neighborhood activities and projects producing vegetables on rooftops and breeding fish in basements....

....This specific Hessian project was carried out in Washington D.C., which shows it is possible to create a somewhat sovereign and independent community even in very urban areas. A neighborhood not dependent on the State for supplies is a neighborhood not easily subdued. Also, such a community is not as easily punished by the government if its independence is discovered and the threat considered real. A community does not suffer from government refusing to supply its services if it isn’t first wholly dependent on such services.

The point I’m trying to make here is not that we should all go rural, live like cavemen, and grow our own vegetables. I’m saying we should stop thinking in terms of centralization and large-scale production. Hess stresses the fact that most, if not all important technology is equally or better suited for small-scale use on a family or community level. We do not need to rely on global corporations or the nation-state to get our hands on what we treasure in life. Community Technology shows just that.

The other [horizontal] strategy simply means taking part in and actively creating networks and structures for black markets....

What it basically proposes is to trade with people you know and people who are recommended to you. This can all be done at whatever scale one finds appropriate, using available technology such as the Internet and e.g. E-bay for communication and money transactions. A first step could be to hire the children next-door to mow the lawn or baby-sit. It does not have to be very sophisticated at first....

There are probably a few libertarians in every town who are interested in starting a private network for free trade. This network can grow and find other networks to trade with and thus cover a multitude of goods and services and large areas and perhaps whole continents. The beauty of it is that it all comes naturally, it is intuitive for people to exchange favors, goods, and services without first asking the State’s permission.

This strategy was originally proposed by agorist Samuel Edward Konkin III, author of The New Libertarian Manifesto, in which he elaborates the strategy of counter-economics....

Counter-economic networks would grow much stronger if combined with the insight of Karl Hess that people are able to and benefit from taking over the production of essential goods and services locally. Imagine the web of counter-economic actors combined with sovereign communities with production of foodstuffs and technology exceeding their internal demand. That combined counter-State movement for personal benefit and profit would provide a powerful adversary to the State.

Venture Communism: Telekommunisten

Dmytri Kleiner, of the Venture Communism project, announces the launching of the first business enterprise under that project: Telekommunisten. It's an IP-based virtual phone company, worker-owned and operated.

The perfect service for managing your organization's phones, including automated attendant, call forwarding, voice mail and many other features you would expect from a professional PBX system, yet because our system is IP-based we can provide features no traditional telephone switch can provide, such as unbelievably low international calling rates, and the ability to map phone numbers from all over the world to your local extensions....

For more background on the idea of a Venture Commune, you can check out Kleiner's discussion list. This post, in particular, has a lot of detail on the idea:


....The Venture Commune is a type of voluntary worker's association, designed to enclose the productivity of labour and enable the possibility of the collective accumulation of Land and Capital, which, in the endgame, will eventually allow the workers to buy the entire world from the Capitalists....

How can workers change society to better suite the interests of workers?

As long as they operate within the Capitalist mode of production, they can not change society politically, because whatever wealth they can apply to influencing social institutions must come from the share of the product that they retain, and thus will always be smaller then the share of the product that can be applied by Property to prevent this change.

Any political change is dependent on a prior change in the mode of production which increases the share of wealth retained by the worker. The change in the mode of production must come first, this change can not be achieved politically, not by vote, nor by lobby, nor by advocacy, nor by revolutionary violence.

Not as long as the owners of property have more wealth to apply to prevent any change, by funding their own candidates, their own lobbyists, their own advocates, and building up a greater capacity for counter-revolutionary violence.

Society can not be changed by a strike, not as long as owners of Property have more accumulated wealth to sustain themselves during production interruptions.

Not even collective bargaining can work, for so long as the owners of Property own the product, they set the price of the product, thus any gains in wages are lost to rising prices.

So how can workers change society to better suite the interests of workers if neither political means, nor strike, nor collective bargaining is possible?

By refusing to apply their labour to property that they do not own, and instead, acquiring their own mutual property.

This means enclosing their labour in Venture Communes, taking control of their own productive process, retaining the entire product of their labour, forming their own Capital, and expanding until they have collectively accumulated enough wealth to achieve a greater social influence than the owners of property, making real social change possible.


A Venture Commune is a joint stock corporation, much like the Venture Capital Funds of the Capitalist class, however it has four distinct properties which transform it into an effective vehicle for revolutionary worker's struggle.

1- A Share In The Venture Commune Can Only Be Acquired By Contributions Of Labour, And Not Property.

In other words only by working is ownership earned, not by contributing Land, Capital or even Money. Only Labour.

It is this contributed labour which represents the initial Investment capacity of the Commune.

The Commune Issues its own currency, based on the value of the labour pledges it has.

It then invests this currency into the private enterprises which it intends to purchase or fund, these Enterprises thus become owned by the Commune, in the same way that Enterprises which receive Venture Capital become owned by a Venture Capital Fund.

2- The Venture Commune's Return On Investment From Its Enterprises Is Derived From Rent And Not Income.

As condition of investment, the Enterprise agrees to not own its own property, neither Land nor Capital, but rather to rent Land and Capital from the Commune.

The Commune, unlike a Venture Capital Fund, never takes a share of the income of the Enterprise nor of any of its workers.

The Commune finances the acquisition of Land and Capital by issuing Bonds, and then Rents the Land and Capital to its Enterprises, or an Enterprise can sell whatever Land and Capital it acquires through other means to the Commune, and in turn Rent it.

In this way Property is always owned Mutually by all the members of the Commune, however all workers and the Enterprises that employ them retain the entire product of their labour.

3- The Venture Commune Is Owned Equally By All Its Members.

Each member can have one share, and only one share. Thus although each worker is able to earn different prices for their labour from the Enterprises, based on the demand for their labour, each worker may never earn any more than one share in the ownership of the Commune itself, and therefore can never accumulate a disproportionate share of the proceeds of Property.

Ownership of Property can therefore never be concentrated in fewer and fewer hands and used to exploit the worker as in Capitalist corporations.

4- All Those Who Apply Their Labour To The Property Of The Commune Must Be Eligible For Membership In The Commune.

The Commune may not refuse membership to any Labour employed by any of its enterprises that works with the Land and Capital controlled by the commune. In this way commune members can not exploit outside wage earners, an the labour needs of the Enterprise will ensure that each Commune continues to grow and accept new members.

In an early exchange on the subject, I asked:

Interesting. Are you proposing that organized workers gradually buy up the economy from the capitalists?

Kleiner's response:

Yes. Exactly. I think John Stuart Mill also proposed something similar in his Workingman's Co-operatives.

In a subsequent email, he elaborated:

Thus, the Capitalists will face a weaker and weaker bargaining position as the Venture Communes grow, and their profits diminish.

Here's how I stated my understanding of the idea:

My idea is that the corporate economy uses capital and land inputs pretty inefficiently, because the state guarantees capitalists access to them in large quantities. The alternative economy possesses them in much smaller quantities, but can use them much more intensively. And as the alternative economy becomes independent of the land and capital of the corporate economy, and labor becomes increasingly scarce and increases its bargaining power, the land and capital in possession of the ruling class becomes increasingly worthless to them.

I expressed the same idea at greater length in this post: "Building the Structure of the New Society Within the Shell of the Old":

Anything that marginally increases the independence of labor and reduces its dependence on wages, and marginally reduces the supply of labor available to capitalists and landlords, will also marginally reduce the rate of profit and thus make their land and capital less profitable to them. The value of land and capital to landlords and capitalists depends on the ability to hire labor on their own terms. Anything that increases the marginal price of labor will reduce the marginal returns on capital and land.

What's more, even a partial shift in bargaining power from capital to labor will increase the share of their product that wage-workers receive even in capitalist industry. The individualist anarchists argue that a removal of special legal privileges for capital would increase the bargaining power of labor until the rate of profit was effectively zero, and capitalist enterprises took on the character (de facto) of workers' co-ops.

And the owning classes use less efficient forms of production precisely because the state gives them preferential access to large tracts of land and subsidizes the inefficiency costs of large-scale production. Those engaged in the alternative economy, on the other hand, will be making the most intensive and efficient use of the land and capital available to them. So the balance of forces between the alternative and capitalist economy will not be anywhere near as uneven as the distribution of property might indicate.

If everyone capable of benefiting from the alternative economy participates in it, and it makes full and efficient use of the resources already available to them, eventually we'll have a society where most of what the average person consumes is produced in a network of self-employed or worker-owned production, and the owning classes are left with large tracts of land and understaffed factories that are almost useless to them because it's so hard to hire labor except at an unprofitable price. At that point, the correlation of forces will have shifted until the capitalists and landlords are islands in a mutualist sea--and their land and factories will be the last thing to fall, just like the U.S Embassy in Saigon.

Thursday, May 11, 2006

More Revolution, Still Untelevised

Via Jesse Walker on LeftLibertarian. Despite Lula's foot-dragging on land reform in Brazil, the Rural Landless Workers' Movement has accomplished a lot outside of state channels.

As Brazil approaches the 10th anniversary of the April 17, 1996 Eldorado dos Carajás massacre, which saw six unarmed land reform protestors shot and thirteen slaughtered with hatchets and machetes at the hands of Brazilain police, attention will again be focused on the disappointing performance of President Luiz Inacio Lula da Silva’s government regarding this issue. The killings drew international attention to the struggles of Brazilian activists who sought to confront their country’s tremendous agrarian inequalities, and helped to further solidify the political clout of the Movement of Landless Rural Workers (MST, Movimento dos Trabalhadores Rurais Sem Terra). The MST, which was a key player in Lula’s finally victorious quest for power in 2002, has become increasingly dissatisfied with the distance between the president’s promises and his actions....

Despite his leftist rhetoric, Lula in power has governed from the center:

...like many of Lula’s other promises regarding social change, it was soon glaringly obvious that land reform would come second to his administration’s neoliberal economic policies which Lula claimed were essential in order to attract the foreign investment needed to generate funds for his proposed social justice programs....

Many of those who most supported Lula as he came into office have become his most ardent critics: human rights groups, NGOs, and even the Catholic Church accuse him of selling out to big landowners and giant corporations. Disenchantment with Lula’s sluggish role in the realm of land reform has been manifested in a wave of land invasions by former Lula supporters, as they attempt to place the issue in the center of the political debate come October. "This was a government that didn't face up to the powerful rural and economic oligarchies," says Maria Luiza Mendonca, the director of the Human Rights and Social Justice Network, an umbrella group.

Brazil is an extreme manifestation of the "latifundismo" phenomenon:

According to the Brazilian Census Bureau, 1% of landowners currently control 45% of the nation’s farmland, while approximately 37% of Brazil’s 184 million citizens hold less than 1% of land. Meanwhile in Brazil, the so-called “South American breadbasket,” about 4.8 million landless farmers struggle to survive with temporary or part-time work, on meager wages, and under conditions, as reported by the U.S. State Department Human Rights Bureau, as being analogous to slavery....

According to Brazil’s National Institute for Settlement and Agrarian Reform (a public body), 150 million hectares of farmland is presently underused in the country, including 20 million fertile and easily accessible hectares that could be put into production almost immediately. The MST estimates that up to 60% of the Brazilian countryside lies fallow, producing a devastating social backlash as millions of the rural poor join the ranks of the nation’s favela (urban slum) dwellers. “Indeed,” the MST insists, “the wealthiest 20% of the Brazilian population own 90% of the land, much of it being idle, used for ranching, tax write-offs, or to produce crops exclusively for export, while millions starve in the country.”

Or slash and burn rain forests for want of access to vacant land far better suited to farming.

The MST arose in 1984 in response to these conditions. It's probably the most important grass-roots land reform movement in the world. Dr. Miguel Carter of American University, who specializes in Brazilian land reform issues, argues that

MST’s nonviolent tactics – land occupations, marches, road blockades, and petitions – have demonstrably strengthened Brazil’s civil society by incorporating its most marginalized masses into its inner recesses. Perhaps this record of success helps to explain why, despite the fact that the Brazilian media overwhelmingly portrays the group as radical, and therefore dangerous, opinion polls by April of 1997, revealed that 94% of the population felt the MST’s struggle was just, and that 85% supported its non-violent method of land occupations as a proper vehicle for accelerating lethargic government reforms....

And if, under the cumulative effects of neocon propaganda, you've come to identify "civil society" with ice cream socials and bowling clubs, while the guys in suits hold the real reins of power, think again. The Brazilian underclass has succeeded in organizing a civil society of its own, outside of the state capitalist system:

...Often living in tents and armed only with farm tools, landless activists have been able to make impressive gains, acquiring a total land area of roughly the size of the state of Louisiana. Approximately 200,000 landless still wait in make-shift encampments, sleeping under tarps on the sides of highways, or squatting on vacant plots.

While squatters carry out ad hoc land reform, the MST has stepped in with social services where the Brazilian government has failed, both under Lula and his predecessors. The MST draws funding from often creative sources, ranging from 400 farming cooperatives, to its own natural medicine plant in Ceara. Its 1,600 government-recognized settlements, spread across 23 Brazilian states, boast health care centers, 1,800 primary and secondary schools (serving 160,000 children), and a literacy program involving over of 30,000 adults. In 2005, the MST established its first university, Escola Nacional Florestan Fernandes, named after the famous Brazilian intellectual, on a campus outside of São Paulo. In addition, as a method to accelerate the spread of social services, the organization has signed a number of formal agreements with federal government and sub-national agencies to carry out a variety of development projects to provide services, including education and healthcare....

If they keep this up, they may decide they don't need Lula as much as he needs them.

Stamping Out Ownlife

The novelist, Nigel Balchin, was once invited to address a conference on "incentives" in industry. He remarked that "Industrial psychologists must stop messing about with tricky and ingenious bonus schemes and find out why a man, after a hard day's work, went home and enjoyed digging in his garden."

But don't we already know why? He enjoys going home and digging in his garden because he is free from foremen, managers and bosses. He is free from the monotony and slavery of doing the same thing day in and day out, and is in control of the whole job from start to finish. He is free to decide for himself how and when to set about it. He is responsible to himself and not to somebody else. He is working because he wants to and not because he has to. He is doing his own thing. He is his own man.

--Colin Ward, Anarchy in Action

It's amazing how much continuity there is between the behaviors demanded of students by the publik skools, and of employees by their employers.

Sunni Maravillosa, in a post on unschooling, quotes a critic:

"It is not suited either to all kids or all parents," said Tom Hatch, a professor at Columbia University Teachers College in New York City. "It requires students with considerable curiosity and independence, who come up with and get interested in questions and can sustain some interest in them."

She comments:

To simplify the idea further, today's American educational system is largely geared to spit out white-collar cogs for the corporate and bureaucratic machines. How can someone attempt to just estimate how many of those unhappy cogs would have been much better served by going to a trade school, but didn't even consider that possibility because of a lack of knowledge about their existence or because such careers tend to be looked down upon?

I have yet to see a child with anything close to normal intelligence, who hasn't yet had his or her natural inclination to explore beaten to death, who doesn't have considerable curiosity and independence. Yet when a mechanically-inclined school student takes apart a piece of equipment to see how it works instead of completing his math sheet along with the rest of the class, will that initiative be rewarded? Of course not! Most formal schooling pounds out curiosity and independence, which they must if all students are going to fit neatly into their little curricular boxes.

As Paul Goodman wrote somewhere, one of the first lessons a schoolchild learns is that whatever independent interest or project he pursues is only a "hobby," to be patronizingly tolerated by those in authority so long as it doesn't interfere with his "real" learning--but to be instantly put away in favor of the important tasks assigned him by the teacher, the boss, or whatever other authority figure has assumed the right to determine the ends of his existence.

F. Gruel, in a comment to Maravillosa's post, vividly recaptured a feeling most of us remember all too well:

I spent 13 years in government school (including kindergarten.) At third grade I had a severe dislike of my school situation. It seemed so foreign. Summer break was always a great experience. Runnin' around, doin' "stuff".

When school started it was horrible. Just seeing all the, otherwise intriguing, "school supplies" at Target made me depressed. Even getting "school clothes" irritated me. Why couldn't I wear the same shit I've been wearing all summer?

But most of us don't have to remember back that far to relive the feeling. The sense of dread, of impending loss of freedom, experienced by F. Gruel at the prospect of another school year, is the same dread felt by most sane people at the loss of control experienced every time we step through the front door of our workplace. The prison doors are about to clang shut.

The transition from self-directed work to work under a boss was especially violent for those experiencing it for the first time, during the early days of the factory system. J.L. and Barbara Hammond, in The Town Labourer, wrote:

In the modern world most people have to adapt themselves to some kind of discipline, and to observe other' people's timetables, ...or work under other people's orders, but we have to remember that the population that was flung into the brutal rhythm of the factory had earned its living in relative freedom, and that the discipline of the early factory was particularly savage.... No economist of the day, in estimating the gains or losses of factory employment, ever allowed for the strain and violence that a man suffered in his feelings when he passed from a life in which he could smoke or eat, or dig or sleep as he pleased, to one in which somebody turned the key on him, and for fourteen hours he had not even the right to whistle. It was like entering the airless and laughterless life of a prison.

The state public education systems in the United States were set up mainly to transform a largely self-employed population, used to working under their own direction, into "human resources" who would willingly take orders from a boss. The habits of cheerfully obeying teacher, of lining up on command, of eating and pissing at the sound of a bell, were precisely the habits required of factory workers.

Since then, the emphasis has changed somewhat. Now the schools inculate the habits of bureaucratic toadyism that are desired in a white collar worker. But the principle is basically the same.

The adult who goes to work is infantilized: transformed into a bigger version of the school child whose advancement and success depend entirely on pleasing the teacher, on sucking up to authority figures in general. An anonymous GM worker expressed it beautifully in this poem, reproduced by Tom Peters in In Search of Excellence:

Are these men and women
Workers of the world?
or is it an overgrown nursery,
with children--goosing, slapping boys
giggling, snotty girls?

What is it about that entrance way,
those gates to the plant? Is it the
guards, the showing of your badge--the smell?....
What is it that instantaneously makes
a child out of a man?
Moments before he was a father, a husband,
an owner of property,
a voter, a lover, an adult.
When he spoke at least some listened.
Salesmen courted his favor.
Insurance men appealed to his family responsibility
and by chance the church sought his help....

But that was before he shuffled past the guard,
climbed the steps,
hung up his coat and
took his place along the line.

Going to work, like going to school, means substituting someone else's priorities and judgement for your own.

Ken Blanchard, in his foreword to Fish!, has expressed dismay at what he called the "TGIF mentality." He wondered what we could accomplish if we put 100% of ourselves into our work, instead of bringing only 60% of ourselves to work and leaving the rest out in our cars waiting to go home.

That's one thing he got right. We leave a lot of ourselves behind when we go to work. We leave our values, our independent judgment, and our personal priorities at the door, and become a tool in someone else's hand.

For people like Blanchard in the world of work, as for educrats in the world of skool, the atavistic persistence of ownlife is something to be overcome through new and better forms of human resource engineering. They are mightily offended by what Elizabeth Anderson called the separation of work from home.

However arbitrary and abusive the boss may have been on the factory floor, when work was over the workers could at least escape his tyranny (unless they lived in a factory town, where one's boss was also one's landlord and regulator of their lives through their leases). Again, in the early phase of industrialization, this was small comfort, given that nearly every waking hour was spent at work. But as workers gained the right to a shortened workday--due to legislation as well as economic growth--the separation of work from home made a big difference to workers' liberty from their employers' wills.

As long as wage labor has existed, the whole point of it has been a devil's bargain in which one sells one's life in order to live; a shift at work is a chunk of your life that you cut off and sell, so you can have the money to support yourself in your real life--the part you have control over. In return for the worker's submission to the bosses' authority on the job, he received sovereignty over the rest of his life in the "real world" outside of work. Under the terms of this Taylorist bargain, the worker surrendered his sense of craftsmanship and control over his own work in return for the right to express his "real" personality through consumption, in the part of his life that still belonged to him.

This fundamental distinction, one of the basic qualities that makes us human, is reflected in the saying that "every Englishman's home is his castle," and the widespread libertarian understanding that property is the basis of freedom. "There, I take orders from you; here, in my domain, I control my life."

Is it really that hard for Blanchard to understand? What sane person wouldn't prefer a world in which the priorities he follows are his own? In which he has real control--not in the artificial Fish! philosophy sense of controlling how he reacts to situations imposed on him by others, or "choosing his attitude," but of actually controlling what he does, and when and how he does it, without taking orders from someone else. What sane person wouldn't regard his private life as his real life, and his job merely as a means for serving that end?

The Taylorist bargain is no longer good enough for our overlords. It's not enough that we take their orders and do our jobs willingly while we're at work. The fact that a part of us looks forward to leaving the prison and reentering our private domains, rejoining the 40% of ourselves that we leave in our cars at work, means that our minds don't completely belong to Big Brother.

It's significant that HR Nazis are so enamored of the Myers-Briggs personality test. As Barbara Ehrenreich suggested in a recent interview, it's probably to weed out the introverts. An introvert is someone who finds continued dealings with others to be a drain on his energy, and needs time alone in his own space, in a world under his own control, to recharge. So the distinction between work and ownlife (Blanchard's much-lamented "TGIF mentality") is built into the basic structure of the introvert's personality, even more so than with people in general. Work is a period of time that belongs to somebody else, to be endured until it is over, so one may get back to the business of living his real life. For such a person, the modern trend of increasing intrusion of work into the sphere of private life is especially galling. The eroding and increasingly permeable boundary between work and home, with the possibility that work might erupt into one's private life at any moment with the ringing of a cell-phone or the beeping of a pager, is simply intolerable.

In other words, introversion is simply a more intense experession of the same characteristic that the HR Nazis want to stamp out in all of us.

What they hope for is the same thing desired by the Party in Orwell's 1984: a new, inhuman breed of human being who no longer distinguishes between private and public life, between mine and thine. Like the Party, they want to stamp out the last vestiges of ownlife and create a New Man who is happy to think of "home" as a shelf where he's stored when he's not doing something important, until he can again be "of service." Blanchard, while he's wishing away the TGIF mentality, might as well wish for a new kind of school child who doesn't dread the beginning of the five-day sentence on Monday morning, or the first day of school in September. If Blanchard and his ilk succeed, through some combination of conditioning, electrodes, and pharmacology, in creating a worker who doesn't look forward to getting out from under his boss so he can go home and dig in his own garden, they will have succeeded in stamping out the last vestiges of ownlife; more imporantly, they will have succeeded in remaking humanity in the Party's image. What Blanchard and his ilk desire is a hive of human worker bees.

Monday, May 08, 2006

The Cost of Addiction

Via Catallarchy. Doc Searls compares the Net, as a "public good," to the Interstate Highway System. In the process, he refers to the "advances made possible" by the Interstate and asks:

According to Wikipedia, the Interstate Highway System cost $114 billion to build. Can we even begin to calculate what it would cost us today not to have it?

As I commented at Searls' blog post, the main cost of not having the interstate has been brought about by our having it.

Access to subsidized highway transportation, at a cost that has little if anything to do with the costs one imposes on the system, has encouraged a business model that relies heavily on the Interstate. The Interstate has generated distance between things, and thus increased our dependence on the Interstate. It's an example of what Ivan Illich called a "radical monopoly."

And to the extent that subsidized long-distance transportation makes centralized production artificially profitable, the Interstate results in a net loss of efficiency. We'd be better off, overall, if the Interstate had never been built. Something which is only profitable when the cost side of the ledger is shifted to somebody else, is not really an "advance."

Friday, May 05, 2006

Two New Publications

Roderick Long, Austro-Athenian Empire blogger and editor of Journal of Libertarian Studies, has announced a new publication: Industrial Radical.

Topics to be explored include: radical libertarian alternatives to statism, militarism, and intellectual property; the social and cultural requirements of a free and flourishing society; the structure of work, family, and property relationships in such a society; strategies for getting from here to there; and the possibility of “gains from trade” between the left/socialist and right/capitalist traditions within libertarianism.

The title “Industrial Radical” honors the libertarian and individualist anarchist thinkers and activists of the 19th century, who were “industrial” in the sense of championing what they called the industrial mode of social organization, based on voluntary cooperation and mutual benefit, over the militant mode, based on hierarchy, regimentation, and violence; and who were “radical” in the sense of recognizing that social problems are embedded in sustaining networks of institutions and practices, and so can be addressed only via thoroughgoing social change. Their approach informs our vision.

Check out the planned themes of the forthcoming issues, and I think you'll agree it's something to look forward to.

Just Things: The Fair Trade Journal of Applied Counter-Economics has just put out its first issue. It's edited by Steve Herrick (aka esteban), frequent Mutualist Blog commenter and owner of chlorophyll blog.

The purpose of both the magazine and the site is to explore how the fair-trade model, which is currently focused heavily on coffee, can be extrapolated out to the wider economy. At its core, the fair-trade model isn't about commodities at all, but an equitable, egalitarian and empowering way of dealing with each other as people. Economic transactions are secondary - they deal with mere things. On the other hand, we need things to live, and we have trade them back and forth. The trick is to trade things justly.

Thursday, May 04, 2006

Michael Lewyn: A Libertarian Smart Growth Agenda

Via Trevor J. Acorn.

"Smart Growth" is often a dirty word among supporters of smaller government. For example, the Heritage Foundation's Edwin Feulner titled a recent article: "Protecting Your Property From Stupid 'Smart Growth' Socialists."

But if "smart growth" means support for more walkable, less vehicle-dependent communities, smart growth supporters and the property rights movement share a common cause on many issues relating to land use and transportation.

In particular, both movements have excellent reason to oppose numerous elements of American zoning law.

For example, both sprawl critics and libertarians should oppose government regulations that create a separate zone for every human activity....

Government spending also causes problems for libertarians and smart growthers alike. Every year, government at all levels spends over $100 billion on highways -- highways that, by facilitating development on the suburban fringe, shifts development away from older, often more walkable, communities. Every dollar spent on new and wider highways is a dollar taken from taxpayers, and every inch of right-of-way that Big Brother takes is an inch taken from landowners. So advocates of limited government have excellent reasons to favor limited highway spending.

Wednesday, May 03, 2006

Dave Pollard on Organizational Behavior

....business 'leaders' don't get it: They tell other people what to do, tell them what they want done, and bring in consultants and experts to help them 'effect change' in their organizations. They cannot fathom that most of what happens in their organizations is workarounds developed by front-line people to make things work in the organization despite the inept and usually inappropriate advice of management and professional advisors who only think they understand what is really going on and why.

And when an industry is cartelized among a handful of firms, the internal policies of each firm are likely to be based on the "industry trend": that is, on what a firm's management hears from equally clueless management at other firms, who know as little as they do about the real effect of their policies on what happens at the level of actual production. The people at the tops of the pyramids can communicate with each other much more effectively than they can monitor what's going on at the lower levels of their own organizations. As R.A. Wilson said, you never tell the truth to a man who's pointing a gun at you; information is systematically filtered as it moves up the hierarchy, until those at the top drown in falsified data. Deming said "drive out fear," but it's easier said than done. The only reliable way to do it may be to reverse the flow of authority, from bottom to top.