Exodus and Counter-Economics, Part 3.1: Libertarian Class Theory

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The Roots of Libertarian Class Theory

“The theory of class conflict as a key to political history did not begin with Karl Marx,” wrote Rothbard in “James Mill and Libertarian Class Analysis”. “It began… with two leading French libertarians inspired by J.B. Say, Charles Comte and Charles Dunoyer, in the 1810s after the restoration of the Bourbon monarchy.” How was it that Comte and Dunoyer, the former a journalist and the latter an economist, came to hold the title of originator of class conflict?

Both Comte and Dunoyer were radicals of their time and place. Le Censur, the journal they founded together in 1814, was an organ of pro-liberal, anti-Bourbon and anti-Bonaparist rabble-rousing. The influence of this time of uprising and turmoil, the era of revolutions, is the foundation upon which their class theory is built. Like the dialectical opposition between the bourgeoisie and proletariat offered by Marx (who indeed took turns praising – and criticizing – both Comte and Dunoyer), there are two classes locked into political struggle:

  • The rulers, the group that has seized state power
  • The ruled, the group subordinated by the rulers, “taxed and regulated by those in command”

It’s easy to see how this would dovetail precisely the sort of political line that Rothbard held for the majority of his life: that the state was a vehicle of domination that did little than oppress others. At the same time, it allowed him to create a juxtaposition: on one side, the class struggle, and on others, the free market. In Comte and Dunoyer, “class interest… is defined in relation to the state” – itself a foreshadow of Marxist conceptions of the state that present it as a battleground for class conflict between the proletariat and the bourgeoisie. Drawing on J.B. Say, Comte and Dunoyer, by contrast, pose an opposition between the ‘natural state’ of relations between producers (encompassing both employers and workers), and the “conflict between interest [that emerges] between producers and non-producers, including those members of the producing class when they choose to exploite government-granted privilege.” (Ralph Raico Classical Liberalism and the Austrian School, pgs. 192-193)

Thus for Rothbard, the elimination of the state would entail the obliteration of class conflict – precisely the reverse of the Marxist (in particular the Marxist-Lenisit) suggestion that the elimination of class conflict would entail the “withering away of the state”.

Another vital piece of Rothbard’s class theory was pulled from the writings of political economist and sociologist Franz Oppenheimer. Despite being a self-described “liberal socialist” (that is, a free market anti-capitalist, in today’s parlance), Oppenheimer’s writings bestowed a large influence not only on Rothbard, but two of the major Old Right luminaries discussed in the last post: Albert Jay Nock and Frank Chodorov. Key was his book The State: Its History and Development Viewed Sociologically (published in German in 1908, but not translated until 1922), which was a resounding rejection of the “social contract” theories of the state; the state, Oppenheimer countered to Rousseau and his fellow thinkers, was founded in the first instance by one group defeating and subordinating another. In this respect, Oppenheimer’s theory hews closer to that of Comte and Dunoyer.

Oppenheimer drew a contradistinction between two different forms of obtaining wealth: on one hand, we have the “economic means”, which is achieved by way production and trade, and on the other the “political means”, which entails coercive action and the “forcible appropriation of the labor of others.” (Oppenheimer, The State, pg. 24) If the state has a distinct form, it is “an organization of the[se] political means. No state, therefore, can come into being until the economic means has created a definite number of objects for the satisfaction of needs, which objects may be taken or appropriated by warlike robbery.” (Oppenheimer, The State, pg. 27)

Taken together, a unified picture emerges: the state as a parasitic entity, founded upon violence, and shaped by its sole intention of appropriating the wealth generated by the relationship between owners and workers. Thus for libertarians like Rothbard, the state and capitalist were forces fundamentally opposed to one another. This would also entail a shifting of focus on what the state is structurally (i.e., the juridical order upon which it is founded) to what it does systematically, a move that effectively broadens the definition of the state beyond what most people would define it as. To quote Chris Sciabarra,

In his class theory, Rothbard operates with an expansive concept of the state. The state is not merely the governmental apparatuses and its fulltime bureaucracy. It is also constituted by the groups that have gained privilege through state action. The excluded groups constitute the ruled. The state provides legal, legitimized, systematic channels for the violent appropriation of the ruled to the benefit of a parasitic class. (Sciabarra Total Freedom: Toward a Dialectical Libertarianism, pg. 270)

Radical Libertarian Class Theory

Across the 1950s and 1960s, the intertwined sociological study of the relations between the economic and political elite and the “revisionist” school of American history emerged in syncopation with the burgeoning New Left. In 1956, C. Wright Mills published The Power Elite, a powerful exploration of the way that the top layer of American society, consisting of the corporate, political, and military elite, was not only detached from the everyday conditions of the rest of society, but in fact served as the actual basis of power in the country. As he wrote in the opening of the work,

As the means of information and of power are centralized, some men come to occupy positions in American society from which they can look down upon, so to speak, and by their decisions mightily affect, the everyday worlds of ordinary men and women… Whether they do or do not make such decisions is less important than the fact that they do occupy such pivotal positions: their failure to act, their failure to make decisions, is itself an act that is often of greater consequence than the decisions they do make. For they are in command of the major hierarchies and organizations of modern society. They rule the big corporations. They run the machinery of the state and claim its prerogatives. They direct the military establishment. They occupy the strategic command posts of the social structure, in which are now centered the effective means of the power and the wealth and the celebrity which they enjoy. (C. Wright Mills, The Power Elite pg. 4)

Amongst the historical revisionists we can count William Appleman Williams, who identified the rise of what he dubbed “corporate liberalism” – an approach to the population by those who power that saw individuals not only as passive actors, but groups who could be steered towards certain ends. A similar mode of analysis was offered by Gabriel Kolko; as was touched on in the previous post, Kolko had identified the Progressive Era not as some period of egalitarian reformism, but a period in which corporations utilized reformism as a means to protect their monopoly status from the threat of competition. This had ushered in, Kolko argued, a regime of what he called “political capitalism”, which would be exemplified by structures like Woodrow Wilson’s merger of state and economic power during World War I (as identified by Williams as the exemplar of his corporate liberalism) and the later New Deal. In the specific instance of the World War I, relations between classes had to be harmonized and variables eliminated so planning for production could continue as smoothly as possible, but this was also the more general condition of a society steered by industrialized mass production:

Political capitalism is the utilization of political outlets to attain conditions of stability, predictability, and security—to attain rationaIization –in the economy. Stability is the elimination of internecine competition and erratic fluctuations in the economy. Predictability is the ability, on the basis of politically stabilized and secured means, to plan future economic action on the basis of fairly calculable expectations. By security I mean protection from the political attacks latent in any formally democratic political structure… not that all of these objectives were attained by World War I, but that important and significant legislative steps in these directions were taken, and that these steps include most of the distinctive legislative measures of what has commonly been called the Progressive Period. (Kolko, The Triumph of Conservatism: A Reinterpretation of American History, 1900-1916, pg. 3; emphasis in original)

The approaches of Mills, Williams, and Kolko were synthesized by G. William Domhoff, who posed the study of elites as not a cohesive group, but as a disparate class with factions who regularly compete with one another. This competition, in turn, could be traced through the way that philanthropic foundations, think-tanks, academia, inter-governmental commissions and non-governmental organizations operate with regards to the population and towards one another. One key conflict identified by Domhoff, for example was between international-minded capitalists, more traditionally aligned with finance interests, and economic nationalists, who generally came from manufacturing (keep in mind that this was prior to the era of globalization). Cohesive political legislation often emerged, in this pre-global era, when one sided one out against the other and concessions had to be made.

During his overtures towards the New Left, Rothbard readily adopted these various theories and integrated them into his libertarian class theory, which he in turn propagated throughout the pages of Left and Right. Often it became impossible to differentiate from the words written by Rothbard and, say, the neo-Marxist analyses offered by people like Paul Baran and Paul Sweezy in the pages of Monthly Review  – or indeed, in the journals of the original Italian Autonomists. Consider the following words, for example, used to describe the Fordist era:

[It was] a new order marked by strong government, and extensive and pervasive government intervention and planning, for the purpose of providing a network of subsidies and monopolistic privileges to business, and especially to large business, interests. In particular, the economy could be cartelized under the aegis of government, with prices raised and production fixed and restricted, in the classic pattern of monopoly; and military and other government contracts could be channeled into the hands of favored corporate producers. Labor, which had been becoming increasingly rambunctious, could be tamed and bridled into the service of this new, state monopoly-capitalist order, through the device of promoting a suitably cooperative trade unionism, and by bringing the willing union leaders into the planning system as junior partners. (Murray Rothbard and Ronald Radosh New History of Leviathan: Essays on the Rise of the American Corporate State, pgs. 66-67)

and again:

For their part, the liberal intellectuals acquired not only prestige and a modicum of power in the new order, they also achieved the satisfaction of believing that this new system of government intervention was able to transcend the weaknesses and the social conflicts that they saw in the two major alternatives: laissez-faire capitalism or proletarian, Marxian socialism. The intellectuals saw the new order as bringing harmony and cooperation to all classes on behalf of the general welfare, under the aegis of big government. In the liberal view, the new order provided a middle way, a “vital center” for the nation, as contrasted to the divisive “extremes” of left and right. (Rothbard and Radosh New History of Leviathan, pg. 68)

Rothbard would carry these ideas with him as he drifted towards the right (unsurprising, given his tussles with the Koch brothers), and by the 80s and 90s attacked economic globalization on the same grounds as the paleoconservatives and Buchananites he was now acquainted with, finger ‘left-leaning’ institutions such as the United Nations, the Council on Foreign Relations, and the Trilateral Commission. SEK3 would note this by observing that “only rightist kooks and commies talk about ruling classes and class structures” – an observation that seems all too pertinent when we consider that with a decade there would be an unspoken – and very unfortunate – alliance between the far-left and the far-right when it came to the issue of globalization. But as Wally Conger later retorted,

Konkin was neither a rightist kook nor a commie. But his theory of ruling classes and class structures remains today a brilliant libertarian alternative to tired Marxist theories of class struggle. And that theory may serve as the foundation upon which to build a strong, revitalized libertarian movement.

It’s hard to say how much Konkin’s class theory truly deviated or enhanced Rothbard’s own bricolage of classical liberalism, Oppenheimer’s state theory, and the “elite theory” and historical revisionism of the New Left intellectuals. Nonetheless, libertarian class theory forms the center of SEK3’s agorist revolutionary practice by striking a distinctive parallel with leftist critiques of cooptation and recuperation: if the state is an organ of institutionalized violence and appropriation, how, then, could libertarians seek to utilize the state to their own ends? If philanthropic foundations, think-tanks and commissions were the functionaries of this order, how could libertarians receive funding from them, or enter into strategic alliances, while maintaining an ostensibly revolutionary position?

Next post, libertarian class theory will be compared with theories of hegemony and the Autonomist concept of the “cycle of struggles” to adapt and augment certain drawbacks of Rothbard’s problematic juxtaposition of capitalism and the state.