The Market and the State
Few things are as repugnant to the socialist and the anarchist as that most flummoxing of movement – the anarcho-capitalists. What the socialists and the anarchists have always been against, they proudly wear of a badge of honor. Whereas the socialist and the anarchist attack privilege and power in all of its forms, the anarcho-capitalist seeks to disengage privilege and power from one another, and wield that privilege against power, somehow without attention paid to the contradiction. While the socialist and the anarchist struggle to ground their theory and practice in the real world, the anarcho-capitalist proceed from abstractions such as those offered by the Austrian School. Where socialism and anarchism eschew the impulse to nationalism, fascism, and other insidious power relation, certain contingencies of the anarcho-capitalists through their lot in with the alt-right, the ‘race realists’, the so-called aristocratic anarchists, the Neo-Reactionaries, so on and so forth. Everywhere the socialist or the anarchist turns, the anarcho-capitalist emerges as its inverse, its shadow.
There is another function that the anarcho-capitalist has served to fulfill, which is the ongoing isolation of that most contentious of systems: the market.
It is over the market itself that those of us on the left must struggle – and I’m not referring to the defense of Keynesianism or social democratic market economies by some hyper laissez-faire anarcho-capitalist discourse. I’m referring to the free market itself, or, as William Gillis calls it, the “freed market”, a scenario in which exchange takes place beyond the purview of state command or corporate control. The concept of the freed market, despite drawing on laissez-faire doctrines and at times on the writings of the proto-neoliberals, is a distinctively anti-capitalist concept, and rejects at every turn the sort of codifications that lead to the current crisis.
Deferring material analyses of the divergence between markets and capitalism and related issues to future posts, I would ask the reader familiar with the ravages of neoliberalism to answer the following questions:
- When a food riot breaks out against the IMF-imposed corporate looting of a society, who wields the baton against the unruly population so expropriation can continue?
- Who negotiates the trade deals that gives rise to these sorts of conditions, and the conditions that give rise to sweatshop labor, uneven development, and exploitation of the periphery by the core?
- When malinvestment crumbles the ground beneath the feet of the top-heavy financial firm, who provides the cash so business can continue as usual?
- Who enforces the law that locks the academic article behind a $30 pay wall, that gets you penalized for torrenting a movie or video game, or that insulates a piece of genetic code as intellectual property?
The answer, of course, is the state. “Hold on a second,” one might be saying now. “The neoliberal era is marked by the state being seized by the corporations”, and on this they would be right – up to an extent. Substandard discourses on neoliberalism like that of Naomi Klein treats neoliberalism as the deconstruction of state power, while paradoxically emphasizing the role of contractors and militarized intervention in the same breath. David Harvey’s popular account, on which Klein’s approach is based, makes it appear as if states were duped by smooth-talking policy wonks and their big business backers. While smooth-talking policy wonts and big business backers undoubtedly played a role in furthering the neoliberal agenda, we should recall Foucault’s treatment of early neoliberalism in The Birth of Biopolitics as a philosophical discourse surrounding the management of the population by way of the state. In many respects this precisely mirrors the formation of capitalism’s required industrial working class, which proceeded by ways of laws that regimented, standardized, and managed people and their power.
That’s well and good, the reader is probably saying – but would a freed market not simply lead to the concentrations of wealth we have today? Would it not lead to a multiplication of inequalities and forms of exploitation? Would there not be the usual case of owners of property and capital running roughshod over the workers, and would not the same asymmetrical periphery-core develop? I’ll be dedicating future posts to these topics, but for now let’s consider Roderick Long’s reflections on the relationship between consumers and producers in this scenario, discarding along the way the focus on the concept of the “free nation”:
In a free nation, will consumers be at the mercy of producers? With no government agencies to monitor quality control, prohibit price gouging, and the like, won’t it be easier for businesses to exploit their customers?
On the contrary, I think it will be less easy. The greatest threat to such exploitation is competition. The more businesses there are competing for customers, the more difficult it will be for any one business to get away with mistreating its customers.
Consider: The easier it is to start up a new business, the more new businesses there will be. So what determines how easy or difficult it is to start up a new business? Two factors: inherent transactions costs, and government regulations.
Government regulation has the same effect on the economy that molasses has on an engine: it slows everything down. The more hoops one has to jump through in order to start a new venture — permits, licenses, taxes, fees, mandates, building codes, zoning restrictions, you name it— the fewer new ventures will be started. And the least affluent will be hurt the most…
In a free nation, by contrast, new businesses would be sprouting up at a rate we can barely conceive, and would be run primarily by the poor and the middle class. No company could afford to treat its customers like dirt, as so many companies do today, because it would be so much easier to start up a rival company that treated its customers better.
or his reflections on labor relations:
Employers will be legally free to demand anything they want of their employees. They will be permitted to sexually harass them, to make them perform hazardous work under risky conditions, to fire them without notice, and so forth. But bargaining power will have shifted to favor the employee. Since prosperous economies generally see an increase in the number of new ventures but a decrease in the birth rate, jobs will be chasing workers rather than vice versa. Employees will not feel coerced into accepting mistreatment because it will be so much easier to find a new job. And workers will have more clout, when initially hired, to demand a contract which rules out certain treatment, mandates reasonable notice for layoffs, stipulates parental leave, or whatever. And the kind of horizontal coordination made possible by telecommunications networking opens up the prospect that unions could become effective at collective bargaining without having to surrender authority to a union boss.
In this latter quote, Long suggests that in a freed market scenario, the working class would operate far more autonomously, be able to exert its real power over the employer, and to play a larger role in shaping its destiny. This might smack of idealism, and perhaps there are elements of that in play. What interests me is the possibility of an alignment between a market anarchism that uses the agency of the laborer as its foundation (as opposed to the “anarcho”-capitalist perspective, which uses the viewpoint of the businessman as its starting point) and autonomist and workerist approaches to socialism and anarchism. While these two forms may seem at odds with one another, and in many respects are odds with one another, the thread the links them is the notion that the workers have a certain power that can be leveraged against those that exploit them.
Let’s look at this further.
…there are always two perspectives, capital’s versus the workers’s! The analysis of every category and phenomenon must be two-sided…
So wrote Harry Cleaver in Reading Capital Politically (pg. 75). While itself a rather strong reduction from the wider array of relationships that cut across the capital-worker dichotomy, it is nonetheless a useful guidepost for examining how certain relationships do play themselves out. Consider, for example, the wage itself, that for which the worker trades his or her labor-power. We can identify at least three two-fold relationships revolving around this element:
1.A) For the worker, the wage is revenue
1.B) For the capitalist, the wage is a cost
2.A) The wage hides the exploitation that takes place – i.e. the difference between wages-as-variable capital and surplus value
2.B) The wage provides a space of struggle in which the worker pushes back against exploitation – i.e. the struggle for higher wages
3.A) The wage divides the working class and forces the workers to compete amongst each other
3.B) The wage unites the working class and pushes them towards a common goal
Dichotomous spaces of tension such as these derive their existence from within the historical circumstances that propel capitalism into being a world system, and by their nature compose the spaces through which class struggle manifests itself. As Cleaver writes, “the class struggle is over the way the capitalist class imposes the commodity-form on the bulk of the population, by forcing people to sell part of their lives as the commodity labor-power in order to survive and gain some access to social wealth.” (Cleaver, Reading Capital Politically, pg. 82). Under such a system, the capitalist sits, parasite-like, atop the unfolding of capital. The working class produces the commodity, and that commodity is sold to the working class who buy it back with the wages they obtain by producing the commodities in the first place. Kevin Carson captures this scenario perfectly in his humorous depiction of a satirical cartoon from early 1900s America:
Oscar Ameringer illustrated the real-world situation in a humorous socialist pamphlet, “Social for the Farmer Who Farms the Farm”, written in 1912. A river divided the nation of Slamerica into two parts, one inhabited by farmers and the other by makers of other clothing. The bridge between them was occupied by a fat man named Ploot, who charged the farmers four pigs for a suit of clothes and the tailors four suits for a pig. The difference was that compensation for the service he provided in letting them across the bridge and providing them with work. When a radical crank proposed the farmers and tailors build their own bridge, Ploot warned that by depriving him of his share of their production they would drive capital out of the land and put themselves out of work three-quarters of time (while getting the same number of suits and pigs, of course. (Carson, The Homebrew Industrial Revolution, pg. 277)
Ameringer’s cartoon, on one hand, can elucidate Long’s argument that as one moves towards freer market forms, the more flexibility the working class has a whole has towards its own position. One the other hand, it embodies the autonomist argument for the working class’s self-organizing capabilities. Between the two, it easily illustrates how the position of the capitalist is not nearly sacrosanct as he determines it to be. It follows, then, that the wage itself – over which so many battles are fought – is not so sacrosanct either.
The only scenario in which Ploot could enforce his will is in the scenario that he holds the power of monopoly. Something must make it so that his is the only bridge capable of being built; something must prevent the workers from build new bridges.
The ardent capitalist, be it a liberal (in the contemporary American sense of the word) or even the more vulgar of the anarcho-capitalists, may protest at this point and argue that there are no real monopolies exist today. One side might suggest the ability of the Justice Department to break apart would-be monopolies through anti-trust laws (and argue for their strengthening), and the other might suggest that as we’re approaching what they might consider a relatively free market, the tendency towards cartelization that flourished in earlier, more protectionist eras is breaking down. At best we’ll get the concession that certain firms hold a ‘near-monopoly’ status. This will usually be followed a series of caveats about successful entrepreneurs, usually in the tech sector, who struck out with a pile of capital from angle investors and made a killing. If the majority of the working class isn’t pursuing this path, then it is always an issue of time preference and risk.
These are the perspectives of the would-be bureaucrat and the temporarily embarrassed millionaire. From the perspective of the working class, the evidence of monopoly and the exploitation it engenders is splayed across their bodies and their psyches. How many more reports about increasing rates of anxiety, depression, self-harm, illness, whatever, all linked to increasing workloads, less time, and less pay before those inclined to managerialism, on both the left and the right, recognize that individuals are not where they want to be, and more importantly, cannot escape from that place? Why do individuals, like those described in Barbara Ehrenreich’s Nickle and Dimed: On (Not) Getting By in America, remain trapped in employment that leads to downward cycles of poverty (despite their entire horizon of time filled by another shift that was picked up or a second or third job to go to), instead of – as the anarcho-capitalists would suggest – ‘bettering themselves’. The reason is that they cannot – and it is monopoly that does not let them. To quote from the individual anarchist Dyer Lum’s essay “Industrial Economics”, from 1890:
Monopoly hedging in a portion of human activity at the expense of the rest; and at the same time, as zealously protecting the very restrictions of which labor complains. The opposite school, having a partial view of the truth that the law of supply and demand can only have full course under liberty, and that all interference but hampers their natural adaptation to each other, still believed that they were contending under that standard while limiting their demands for freedom of trade to the manufactured product, an error which even Herbert Spencer has not escaped. In asserting theoretical liberty for labor and capital, they are blind to the fact that labor was handicapped, inasmuch as the capital employed was the offspring of monopoly. Thus their freedom only enters in after monopolized production has thrown the product on the market, and is never conceived as entering into relations prior to production.
Without monopoly privileges, the body that Marx and Engels described as the “industrial reserve army” – or perhaps more properly for our world of uneven post-industrialization and industrialization, the “reserve army of labor” – would dissipate. This is the large group of the unemployed and the underemployed, and the people we would describe as “precarious laborers”. In the first volume of Capital, Marx described the reserve army, here in the guise of the “Relative surplus population”, as the “pivot upon which the law of demand and supply of labour works”, and as the figure “absolutely convenient to the activity of exploitation and to the domination of capital.” (Marx, Capital, Volume 1, Chapter 25, Section 3) How so? For starters, it is the function that divides the working class. With only a limited number of available employment opportunities, the workers are compelled to compete with one another – and because the number of would-be workers in the reserve army outstrips the number of available jobs, the owners of capital themselves are the ones who set the wage rates. The workers that compose the working class are thus not only competing against one another, but they are trying to outbid one another for the lowest wage possible.
Thus it becomes the monopoly privilege, itself irreducible to 1) the bloody genesis of capitalism but maintained by 2) the activities of the state (who assisted so much in putting into play capitalism’s genesis as well) which sets the conditions for the dialectical struggles surrounding the wage itself that were identified above. In this sense the struggle against capitalism is always emergent within capitalism, even if the ultimate goal of this struggle is to move beyond capitalism.
This sets up the fundamental conundrum posed in autonomist theory: that while the working class struggles within and against capitalism, this struggle between the two plays itself out within capitalism’s drive to development. In other words, the struggles of a certain stage of capitalist development will come to bear on the following stage in a way that transforms the nature of the struggle. The introduction of Taylorism in the 1880s and Fordism in the 1900s both served to limit the ability of the workers to leverage their power on the shop-floor, while the introduction of Keynesian stimulus programs, expansive welfare nets and the consumer-driven “affluent society” served as a counter-point to the new cycle of struggles that Taylorism-Fordism unleashed. The more contemporary intersection of stringent anti-labor action and the discourses surrounding ‘lifestyle capitalism’, ‘creative capitalism’ and the like serves to combat the more multiplicitious forms of resistance that exploded across the 1960s.
This sets up both positive and negative dynamics that the class struggle must be wary of. Positively speaking, it shows can resistance can enact change that reverberates the social body – and also shows how to escape some of the traps to found in Marx’s writings. Negatively speaking, it shows how the most earnest revolutionary action can be rebounded back into service of the state and capitalism in ways similar to how Deleuze and Guattari, for example, described the ‘addition and substraction of axioms’ by the system to uphold it, or the processes of co-optation that I have analyzed elsewhere. Liberatory action, at least in the truncated from that power ultimately allows, becomes an iron cage, albeit one with bars wider enough that wiggling through might be a possibility.
Next we’ll start looking at some ways that left-wing market anarchism might offer some possibilities of shifting this scenario.