The system IS working!

Well, for those who count… The TUC has produced an interesting report on inequality and income division in the UK. Its conclusions will hardly be surprising to anyone who has paid attention since the 1980s or has a firm grasp of reality (rather than neo-classical economics). Needless to say, under neo-liberalism the rich have got richer, working class people have been squeezed and society has become more caste like (social mobility has fallen).

I’ve contrasted the claims of the neo-liberals with the reality after their reforms before using the example of von Hayek (and in An Anarchist FAQ). I’ll now contrast this data with Milton Friedman.

TUC: “In the 25 years from 1945, the share of the nation’s output going to wages held steady at close to 60% before rising to nearly 65% in 1975. Since that high point, the wage share has been in inexorable decline. Today it stands at a mere 53%. An even steeper fall has occurred in the United States, while continental Europe has experienced a shallower fall.”

Milton Friedman: “One of the most striking facts which run counter to people's expectations has to do with the source of income. The more capitalistic a country is, the smaller the fraction of income for the use of what is generally regarded as capital, and the larger the fraction paid for human services.”

As discussed in AFAQ, this assertion was doubtful even when it was made in 1962. Since the rise of neo-liberalism, inspired in large part by Friedman’s ideas, it has been decisively refuted. The more capitalistic a country has become, the smaller the fraction of income paid for human labour. What a surprise…

TUC: “Britain has, over the last three decades, been steadily transformed from a relatively high wage, low debt, equal society to a low wage, high debt and much more unequal society.”

Milton Friedman: “[a] striking fact, contrary to popular conception, is that capitalism leads to less inequality than alternative systems of organisation and that the development of capitalism has greatly lessened the extent of inequality.”

Again, Thatche r’s Friedman-inspired reforms prove this assertion it is not true. Inequality exploded under the Tories in the 1980s (which shows the sheer gall of the Tories current anti-Brown poster berating inequality under New Labour!). In short, inequality rises with neo-liberalism (and social mobility falls). P aul Krugman’s new book is good on this (although, obviously, US focused).

It would be churlish to note that the 1970s saw the rise of influence of Friedman's ideas in both countries and that they were applied in the early 1980s… but I will!

TUC: “As a result wages have been falling behind productivity growth. Over the last three decades economic potential has been growing by 1.9% per year while real wages have been rising by only 1.6% a year. Since 2000 the gap has widened with real wages rising by around half the productivity gains.”

In other words, workers are producing more for less wages (relatively speaking, of course -- while wages have been increasing, the value of what they produce has increased more). However, according to neo-classical orthodoxy this should be impossible.

Why? Neoclassical ideology states that the wage a worker earns, measured in units of output, equals the amount of output the worker can produce. If not, then capitalists would change the number of workers they hire and so bring wages and productivity in line. If wages were below productivity, capitalists would find it profitable to hire more workers. Conversely, if the wage were above productivity, firms would fire workers, lower wages and increase productivity. Equilibrium requires the wage of a worker equalling what that worker can produce.

Yet, for other 30 years, in both America and the UK no such thing has happened (it did in the “bad old days” of “militant” unions). Productivity growth has exceeded wage growth for decades (more so in the US where the assault on unions was more extreme). Of course, that has not affected the ideology. However, I would suggest that the socialist analysis of how exploitation happens under capitalism (in the workplace) is proven right again… It also suggests that class struggle determines wages just as it determines productivity.

And talking of which, had a discussion on a couple of email lists about “anarcho”-capitalism related issues. One was a link to a suggested leaflet by a left (?) propertarian directed towards the Tea-Baggers movement in America. Given that the Tea-Baggers seem to be unable to identify reality (Obama as communist? Get real!), I’m not sure the best way of addressing them would be. They cannot be ignored as some are working class people disenchanted with the American neo-liberal system (and rightly so) even if the movement itself seems to be pure a Astroturf campaign organised by the same ruling class people who put them into the squeezer to begin with.

While the leaflet had the promising title “EMBRACE THE CLASS STRUGGLE” the text was a major disappointment: “This so-called health care bill is top-down class warfare . . . . We’re not talking about the old, worn out Marxist idea of class struggle between simply the rich and the poor.”

In other words “Do NOT Embrace the Class Struggle”! It suggests class collaboration: “The makers are you — the productive class, both workers and honest business people.” Ah, yes, “honest” business people – presumably the ones who pay their workers the full product of their wages… This brings me to another quote (not sure who originally said it), posted on another list at the same time, on this “libertarian” (i.e., propertarian) “class” analysis:

“One flaw in Marx's thinking, you see, was his theory of exploitation. Libertarians recognize that there is nothing inherently ‘exploitative’ in any genuinely voluntary agreement, such as agreeing to work for a wage.”

I suppose that shows how ignorant these “libertarians” are of the libertarian tradition. Marx took his theory from Proudhon's “What is Property?” – and Proudhon was well aware that wage-labour IS inherently exploitative (and oppressive). That was why he advocated associated labour to replace it.

So merely using the term “class” (or “libertarian”, of course) does not mean that people are talking about the same thing. The same with ideas like “workers’ control”, “socialism”, “anti-capitalism” and a host of other words we apparently share (in this case) with state socialists. This was a point I made in a leaflet addressed to the “anti-capitalist” movement after the likes of the SWP saw its potential.

In terms of the “proof” that wage-labour is non-exploitative, we see around us many “voluntary” agreements which are obviously exploitative and oppressive – patriarchal marriage, for example. Would a “libertarian” proclaim that an abused wife was NOT exploited and oppressed because she remains in the marriage? Here is Walter (voluntary slavery) Block:

“Consider the sexual harassment which continually occurs between a secretary and a boss . . . while objectionable to many women, [it] is not a coercive action. It is rather part of a package deal in which the secretary agrees to all aspects of the job when she agrees to accept the job, and especially when she agrees to keep the job. The office is, after all, private property. The secretary does not have to remain if the ‘coercion’ is objectionable.”

This is quoted in AFAQ as well as my review article on Voltairine de Cleyre. So, obviously, just because something is technically “voluntary” it does not mean that exploitation and oppression are automatically excluded from it. In terms of wage-labour, as Proudhon argued 170 years ago workers sell their liberty to the boss who then uses that power of command to make the worker produce more than their wages. That is the point of hiring workers, after all! Capitalist (Lockean) property rights theory is premised on labour as a commodity, so allowing workers NOT to receive the full-product of their labour while also apparently defending their right to own what they produce. Which is why Proudhon (and then Marx) located exploitation in the workplace and not in exchange.

The feminist author Carole Pateman has written on this issue extensively in her books (The Sexual Contract, for example). Her good introduction to her analysis can be found in the essay Self-Ownership and Property in the Person (she uses the term "libertarian" in this essay although as someone who was in an anarchist group at university she is well aware of the real roots of that word and used the word “contractarianism” in previous works for propertarian ideology). I would recommend reading her if you have not done so already (I use them in An Anarchist FAQ).

This is not to suggest that the capitalist’s do not use state to skew the market in their favour, of course they do (the NAIRU, anyone?). The history of capitalism is one of state intervention (almost always against the working class). That in itself shows that the notion to “honest” business people is a joke. If there really were harmony of interests between classes (as Rothbard suggested) then why have capitalists always used state power to further their interests? If the “free market” really benefited everyone and bosses and wage-slaves have interests in common, the master-class would never have turned to the state in the first place… nor would their ideologues (economists) have rationalised this intervention as essential to keep the proles in their place

Marx would not have been surprised but he would have stressed that such intervention was to bolster the domination of the boss in the workplace and did not create it (while state intervention was used to create capitalism in the first place, I’m talking of individual employment contracts in the here and now). In that, as I’ve suggested, he followed Proudhon’s analysis of how exploitation happened under capitalism. Given that “What is Property?” was written in 1840, there is really no excuse for self-proclaimed “libertarians” to not be aware of its argument. But, then, the ignorance of self-proclaimed “libertarians” about the actual libertarian tradition is staggering. On Infoshop News someone posted a propertarian post replying to Walter Block’s defence of “libertarians” using the term “capitalism” as a good thing. He opines:

“But, the enemies of libertarianism are always trying to take words away from us. They have already long ago stolen ‘liberal.’ We must now call ourselves ‘classical liberals’ if we want to use that appellation at all. Some have recently had the audacity to try to take away the word ‘libertarian.’ I refer, here, to Noam Chomsky, who has the temerity to characterize himself as a libertarian.”

WTF? Block does not know that “libertarian” was first coined by a communist-anarchist in 1858? That by the end of the 19th century it was being used by anarchists across the globe as an alternative for anarchist? That right-wing use of the term dates from the 1950s? And that Rothbard was well aware that, one, anarchists had been using “libertarian” for some time and, second, that all anarchists were socialists? And so the thieves complain when an actual libertarian uses the term to describe their ideas? The audacity…

Perhaps worse is the article which links and replies to Block. Why it got posted on Infoshop I don’t know. It proclaims von Mises as a “revolutionary economist” and Rothbard’s “revolutionary wisdom”! It also states: “I still very tightly cling to self-proclaimed ‘anarcho-capitalist’ Murray Rothbard's activism and anaylsis of morality, ethics, political science and economics.” Not to mention: “The reasoning flaws within the philosophies of self-proclaimed libertarian socialists of the communitarian variety are pretty well described by you.”

So the ideology is the same, but the name is changed! As if we are opposing the NAME of propertarian ideology rather than its content. At least Block does us a favour by honestly proclaiming what he stands for rather than doing a rebranding exercise to make the ideology more appealing to genuine lovers of liberty… Much better to be honest like Block than such self-contradictory nonsense as “Brad Spangler . . .  has contested in the more forward manner that market anarchists of the self-proclaimed agorist, voluntaryist and ‘anarcho-capitalist’ variety are socialists”! Rothbard called himself a capitalist for a reason…

While I’m all for engaging those coming to anarchism from other political positions (hence my attempts to explore the weaknesses of Marxism and Leninism), I fail to see the benefit if all that happens is that someone changes the name of their ideology while keeping the rest of it the same! Sure, propertarians are against “actually existing” capitalism but that is because it is an imperfect example of the “Unknown Ideal” (to use Ayn Rand’s term). Genuine anarchists are against the perfect form as well! Hopefully few anarchists will fall for such obvious rebranding exercises…

Some may wonder why I bother with these people. After the work on AFAQ, I do bother with them that much. I look into them when others post links to them and when they somehow creep into the anarchist and other sites I visit. I keep an eye out for a few reasons.

First, I try and counteract the notion that these people are anarchists (or even libertarians) That is important because unless we challenge that notion we will wake-up one day to find “anarchist” as degraded a term as libertarian has become in America (where it means propertarian). Given that there is a concerted effort to redefine fascism as a “left-wing” ideology, the suggestion propertarians are anarchists needs to be nipped in the bud.

Second, neo-liberalism is indebted to propertarian ideology as well as neo-classical economics (and “Austrian” economics which flows from the same roots). No matter how mental some of their ideas are, they creep into the mainstream (such is the power of money funding think-tanks). Take, for example, Bryan Caplan (author of the propertarian “Anarchist Theory FAQ”) and his book The Myth of the Rational Voter. In it he suggested that the Council of Economic Advisers (a three-member unit of the Executive Office of the President that provides the President with economic advice) be given the right to veto laws which violate approved economic ideology. In other words, rule by appointed economists – a highly elitist position. Caplan says “[i]n a modern democracy, not only can a libertarian be elitist; a libertarian has to be elitist. To be a libertarian in a modern democracy is to say that nearly 300 million Americans are wrong, and a handful of nay-sayers are right.” However, this is not elitist (unless you subscribe to the silly and hypocritical Leninist position that any recognition that new ideas are initially held by a minority is “elitist”). What is elitist is to conclude that this so-called “enlightened” minority should rule the majority, which is what he does suggest by his empowering of the Council of Economic Advisers. Advocating this is far from arguing that we need to be aware of the possiblity of the tyranny of the majority.

Given the terrible record of these “expert” economists predicting the current crisis, who would be silly enough to support such a policy? Well, step up the Tories. “Boy” George Gideon Oliver Osborne in his Mais Lecture argued for “an independent Office for Budget Responsibility” which would be “made up of a three person committee, accountable to Parliament, and a small secretariat of economists and public finance experts.” Its role would be “publishing independent fiscal forecasts at least twice a year around the time of the Budget and PBR, based on existing government policy at the time.” It would “publish a recommendation for the amount of net fiscal tightening or loosening it judges necessary for the Treasury” and if the Chancellor chooses “not to abide by that recommendation he or she will have to explain their reasoning to Parliament, but it would be a brave Chancellor who chose to do so.” So the Tories would add yet more “independent” control (rule by “experts” and economists) to the “independent” Bank of England and so the public would have even less say in the decisions affecting their lives.

So do not discount the impact of propertarian ideology and its role in the class struggle. The aim of propertarians, like neo-liberals, is to disempower the majority, getting them to be in the position of wage-slaves in a company (and so it no coincidence that proposals by propertarians always seem to increase autocratic tendencies in the state, not decrease them). They are seeking to create a system were only property-owners have any meaningful say in things, essentially aiming for Locke’s vision of a state as a joint-stock corporation (i.e., run by the owners and the population in the role of its employees – this is described well in The political theory of possessive individualism: Hobbes to Locke by C. B. MacPherson). Whether it is a minimum state or private defence firms enforcing a Rothbardian “general libertarian law code” is of no great consequence except that in the later there is not even the pretence that the majority can have a say in the laws and decisions that impact on them. I’ve been long toying with producing an “anarcho”-capitalist argument explaining the rise of the state by means of market forces (an imaginary history – along the lines of this (pdf) article – well, if its good enough for the likes of Rothbard to justify capitalism why not?). In short, by buying out or merging with others, a few property owners become the landlord of vast areas of land and numbers of workplaces (and so rulers of those who live and work within them). As this was not achieved by force, these obvious monarchies would not be states from an “anarcho”-capitalist perspective! Rousseau points out the blindly obvious:

That a rich and powerful man, having acquired immense possessions in land, should impose laws on those who want to establish themselves there, and that he should only allow them to do so on condition that they accept his supreme authority and obey all his wishes; that, I can still conceive . . . Would not this tyrannical act contain a double usurpation: that on the ownership of the land and that on the liberty of the inhabitants?

I mentioned I like Rousseau? He is one of my favourite non-anarchist writers. His influence on French thought is key to understanding the evolution of anarchism, particularly his influence on Proudhon (yes, Proudhon rejected many aspects of his ideas but his reasons for doing flow from his influence!). I was going to cover this in my Introduction to Property is Theft! but it was cut (along with much more) due to space considerations. And, yes, the footnotes are longer than the extracted paragraph:

Lastly, as with many French thinkers of the nineteenth century, the influence of Jean-Jacque Rousseau can be seen in Proudhon’s work. This can be seen from both the used terminology and by the fact that he returned to criticise Rousseau time and time again. [1] In many ways, Proudhon can be seen as trying to make the hopes of Rousseau’s vision of a self-governing society, in which people associate as equals and without losing their freedom by so doing. Proudhon, needless to say, rejected the Rousseau of the dominant Jacobin interpretation, namely that of a centralised indivisible republic, as such a scheme simply did not secure the hopes of freedom and equality wished for. [2] Instead, he argued that only a federal regime could secure genuine freedom.[3] In other words, Proudhon can be seen as pursuing a Rousseauean critique of Rousseau. [4]

[1] Even elements of Proudhon’s economic analysis are reflected in Rousseau: “The terms of social compact between these two estates of men may be summed up in a few words: ‘You have need of me, because I am rich and you are poor. We will therefore come to an agreement. I will permit you to have the honour of serving me, on condition that you bestow on me that little you have left, in return for the pains I shall take to command you.’” (“A Discourse on Political Economy”, The Social Contract and Discourses (Everyman, 1996), p. 162)

[2] For an excellent libertarian re-framing of Rousseau’s argument, see Carole Pateman’s The Problem of Political Obligation: A Critique of Liberal Theory (Polity Press, 1985). Her Participation and Democratic Theory (Cambridge University Press, 1970). Robert Graham pursues Pateman’s insights and their relation with libertarian theory in his excellent article “The Anarchist Contract” (Reinventing Anarchy, Again (AK Press, 1996), edited by Howard J. Ehrlich) and his Introduction to the Pluto Press edition of Proudhon’s General Idea of the Revolution. Guild socialist G.D.H. Cole also usefully engages with Rousseau’s ambiguous legacy from a position similar to Proudhon’s.

[3] While the centralised interpretation of Rousseau dominated French radical circles, the notion of a decentralised, federal associative republic was not totally foreign to Rousseau. In the Social Contract, we find him arguing that associations produce particular wills which may overwhelm the general will, so ensuring that “there is no longer a general will, and the opinion which prevails is purely particular.” He then suggests that it was “therefore essential, if the general will is to be able to make itself known, that there should be no partial society in the state and that each citizen should express his own opinion.” However, he then added that “if there are partial societies, it is best to have as many as possible and to prevent them from being unequal.” Although he stated that these “precautions are the only ones that the guarantee that the general will shall be always enlightened, and that the people shall in no way deceive itself” he did suggest the former solution was “the sublime and unique system.” (Book 2, Chapter 3; p. 204)

[4] Given the key influence of Rousseau on Proudhon and his constant engagement with him and his legacy and combined with Marx’s almost utter silence on the matter, it seems ironic to read Paul Thomas suggest that “it is Rousseau’s perception of the problem to which Marx, following Hegel, subscribes.” (p. 11) If by this it was meant that Marx followed the flawed and counter-productive Jacobin interpretation of Rousseau and aimed for a centralised republic then that it would be less false. In reality, it was Proudhon who analysed and explored the ideas and legacy of Rousseau the most of the two: “Between the federal contract and that of Rousseau and 1793 there is all the difference between a reality and a hypothesis.” (The Principle of Federation, p. 39)

Going back to health care, Chomsky argues that it is better than nothing (Michael Moore also makes some good points – and, no, I'm not suggesting he is an anarchist). Some of the comments made in reply are utterly mental... but that seems to be the case these days, so no surprise. I guess we can expect the chorus to start the demonising because Chomsky did not say that the ONLY thing we can do is abolish capitalism and anything else is just a minor distraction designed to keep the system going... (and, yes, state intervention can occur to keep capitalism going, as reforms to combat its worse excesses, try to stablise an inherently unstable system, as well as bolster capitalist market power).

Of course, I cannot really make any sort of comment on this as I have universal health care (actually nationalised – it is amazing I’m still alive and free to write this if the right’s propaganda were remotely accurate!) so I’m not going to be a hypocrite and deny it to others in the name of a dubious understanding of anarchism. I will say this: this kind of bill is what you get when you leave reforms in the hands of politicians. If people took direct action and forced their politicians to pay attention to them, I think this bill would have been far better.

After all, the protests by the right were most the vociferous and on-the-streets and these helped made the final bill as conservative as it is (that and the lobbying by corporations, of course). The reason this bill was so bad was because WE (progressives, sane people, whatever) left it to the politicians to act FOR us. The only people who put pressure on the politicians came from the RIGHT. If the left had been as or more vocal what would have been the result?

I have to say, when I look at the tea-baggers I really fail to see much in the way of possible allies. That is not to ignore them, but rather to recognise that if you think Obama is a Marxist-Leninist then it is going to be hard to get you to recognise reality never mind the joys of anarchism. Particularly as we wish to expropriate “honest” bosses as well as “dishonest” ones in the name of freedom.

Then there are the arguments of the right in terms of the whole “Road to Serfdom” thing. Von Hayek has NEVER been proved right, never (people still invoke his business cycle theory in spite of Kaldor and Sraffa refuting it in the 1930s). No democratic country has moved from state intervention to central planning and to tyranny. None. States which were already dictatorships have introduced central planning, true, but that was not his argument. I guess the empirical evidence is pointless as the whole rationale of the argument is to stop reforms – based on the “slippery slope” premise. So I understand why it is invoked so regularly.

Hayek’s argument ranks with the “reforms will do more harm than good” assertions of neo-classical and “Austrian” economics.... And talking of which, is it not great to have a so-called “science” which says exactly what the bosses want to hear? Of course, that is just pure co-incidence… although if you consider economic ideology as a commodity and subject it to standard supply and demand theory, you would surely conclude that when the rich demand an ideology which supports their position then it will be supplied? But I’ve yet to see a neo-classical economist apply his craft to his own ideology (presumably as a “science” it is above reproach, just like it is above empirical evidence…).

Still, I guess the awkward fact that we in the UK have nationalised health care and yet are as free as Americans is not mentioned. Nor that the moves towards centralised state power and restrictions in liberty really got going under Thatcher and neo-liberalism as they sought to break down all and any barriers to their market reforms. For example, my union is currently being balloted for strike action. Thatcher’s anti-union laws mean that the state is regulating free associations and it really restricts what we can do to resist the impositions of our bosses. As intended... And guess what, wages have been squeezed…The freedom to do what you are ordered to do strangely benefits those who are going the ordering... who could have predicted that... (to quote Proudhon: “Contrary to all expectation! It takes an economist not to expect these things”). Hence the importance of unions and struggle, I would suggest (in spite of the obvious flaws of social democratic trade unions). Needless to say, the right-wing media is attacking the strikers and their unions and as I have discussed before they are framing it in terms of how disgraceful it is for these workers to have higher wages, conditions and whatever than the rest. In other words, invoking the politics of envy to encourage non-union workers to hate unions (and public sector workers) because their situation is not as bad as their own. And who will win this race to the bottom? The bosses, of course.

As I mentioned in my last blog, I’ve been reading Bakunin’s The Political Theology of Mazzini and the International (which is yet more evidence for the blindly obvious statement that Bakunin was a syndicalist – unless you are a Leninist). One day, I saw the reprisals of BA against its strikers and it reminded me of Bakunin’s comment that the “employers . . . and, in general, all men who are put in a position of command, are naturally more or less despots; they love the slavery of their labourers and they detest their revolts; this is in the nature of things.” Nothing much has changed in over 100 years!

Then, during a very much “of its time” discussion of Asia, Bakunin makes the comment strikes are an “apprenticeship in liberty, dignity, rights, and human respect” and that a strike “is the first step in the path of human and real emancipation; this is the apprenticeship of humanity, of its foundation, of its aim, of its thought, of the only road to its emancipation.” Which is another reason why the bosses and their lackeys hate strikes so much, they start to produce the new world which will replace capitalism – both in terms of the structures of a free society but also in the ethics and ideas. By struggling, we change the world and change ourselves.

So it is hard not to agree with Bakunin: “The revolt of the laborers and the spontaneous organisation of human solidary [sic!] labour through the free federation of the workingmen’s groups!” In other words, build the new world while fighting this one.

Another interesting Chomsky interview (as usual). He mentions Freedom, a paper I have been known to write for: “You know, you can see that if you look at, you know, the serious, substantial anarchist journals. Like, take, say, Freedom in England, which maybe is the oldest or one of the oldest anarchist journals” Nice words for a paper which has improved a lot over the last ten years (except the “England” bollocks... he means Britain, he should know better – particularly as he has been to Scotland!).

Finally, the Proudhon Reader (Property is Theft!) now has a cover… I like it. Still looking for An Anarchist FAQ volume 2 cover so suggestions please…

Until I blog again, be seeing you...


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