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Havet
5th September 2009, 22:05
Warning, this thread contains a lot of text. For reading purposes, paragraphs will be included, as well as the bolding of the most relevant parts (according to the OP's criteria).

What Would An Anarcho-Socialist Economy Look Like?


by Keith Preston ([email protected])
9/12/2002



I have been asked by readers of Anti-State.com to expound a bit upon my own anarcho-socialist perspective. Specifically, I have been asked to describe how a socialist-anarchist economy might come into being, how such an economy might sustain itself over the long haul and how the typical town’s McDonald’s or Wal-Mart might be communalized. Before I attempt to answer these questions, it might be useful to the reader if I first sketch a very general outline of the overall conceptual framework I am operating in and the theory of political economy to which I subscribe.

I am a socialist-anarchist in the classical Bakuninist tradition. Like Noam Chomsky, I consider this tradition to be the proper heir to classical liberalism and its critique of concentrated power-political, economic, military, ecclesiastical and otherwise.(1 (http://www.anti-state.com/article.php?article_id=316#1)) For me, at least, Bakuninist anarchism is simply classical liberalism updated to include a critique of the role of business corporations in perpetrating modern systems of power relations. Unlike his enemies, the Marxists, Bakunin recognized that the state is an artificially privileged social class unto itself, above and beyond that of economic and social authorities. In his day (mid-nineteeth century Central Europe), the class structure consisted of the state, first of all, the state-protected feudal landlords, the state church and the nascent industrial bourgeois class created by state intervention into the emerging market economy. (2 (http://www.anti-state.com/article.php?article_id=316#2)) Bakunin’s antidote to this system of oppression involved the insurrectionary efforts of the workers and peasants to remove the state and the state-privileged exploiter classes in favor of a decentralized confederation of peasant communes and workers’ collectives tending the land and the industrial machinery minus the upper strata of oppressors. (3 (http://www.anti-state.com/article.php?article_id=316#3))

What I attempt to do is apply Bakuninist analysis to the modern world. An indispensable aspect of classical Bakuninism is its critique of state socialism. Bakunin predicted that if state socialism ever came to power it would produce a type of "red bureaucracy" that would in turn generate the bloodiest tyranny in history. This prophecy was unfortunately realized in the infamous communist, fascist and national socialist regimes of the twentieth century. Likewise, Bakunin argued that the ruling classes would seek to avoid their own ultimate dislocation and expropriation via popular revolution and seek to subjugate and pacify the working classes by means of a paternalistic welfare state, the purpose of which would be to essentially co-opt and destroy working class movements for self-determination. Hence, the rise of Fabianism, Progressivism, Social Democracy and the New Class bureaucrats and intellectuals criticized by thinkers ranging from George Orwell to James Burnham. (4 (http://www.anti-state.com/article.php?article_id=316#4)) Modern state systems have created what is largely a two-tiered class structure that in many ways mirrors the feudal system of old.

Professor Thomas Dye of Florida State University estimates that the number of true powerholders in American society amounts to approximately seven thousand people. This figure includes those who hold the top positions in government, corporate, educational, cultural, legal and civic institutions.(5 (http://www.anti-state.com/article.php?article_id=316#5)) It is this tiny oligarchy, seven thousand people in a nation of nearly three hundred million, that might be said to constitute the ruling class proper in American society, comparable to the royal families of old. Directly beneath them in the class structure are the New Class apparatchik who have replaced the feudal aristocracy, the Church and the industrial bourgeoisie in the domination of the economic, cultural and educational life of the society. George Orwell described this element:

The new aristocracy was made up for the most part of bureaucrats, scientists, technicians, trade-union organizers, publicity experts, sociologists, teachers, journalists and professional politicians. These people, whose origins lay in the salaried middle class and the upper grades of the working class, had been shaped and brought together by the barren world of monopoly industry and centralized government. (6 (http://www.anti-state.com/article.php?article_id=316#6))

It is for the benefit of this class that most state intervention into the economy and into society is done. It is this class who are the primary beneficiaries of the most extravagant entitlements such as social security, Medicare, civil service pensions and agricultural subsidies. It is the New Class who make their living staffing the government’s social engineering programs, teaching in state schools and universities, working for state-financed foundations and managing the bureaucracy of corporations that are dependent on state subsidies and contracts. Tariffs and other forms of protectionism are set up in part to protect the employment interests of state-connected unions. Professional licensing schemes create monopolistic guilds for New Class professionals. Zoning and land use regulations serve to inflate the real estate values of affluent New Class property owners. These examples are just a drop in the bucket.

The lower tier of this system of artificial class stratification includes rank and file workers and lower management who are the most burdened by personal income, payroll, excise and other taxes and whose labor marketability is devalued through state intervention, persons unemployed by state actions that constrict the supply of employment opportunities, persons subjugated by the state’s welfare system, poor and minority persons herded into the urban reservations of "public" housing, persons rendered homeless by the state’s constriction of the supply of available and affordable housing, small businessmen and self-employed persons regulated to death by coercive state agencies, farmers dispossessed of their traditional lands by state-supported agribusiness cartels and central banks, persons made disabled or infirm by state constriction of available and affordable medical care, persons dispossessed of homes and lands by eminent domain and asset forfeiture laws, those who livelihoods are relegate to the "illegal" market by the state (gamblers, peddlers, vendors, beggars, drug sellers, prostitutes, loansharks, smugglers, etc.), persons imprisoned in the state’s gulags, psychiatric prisons ("mental hospitals"), educational prisons ("public schools"), pseudo-military concentration camps ("boot camps") and so on. These and other similar groups constitute the modern "proletariat", to use a classical term. The modern version of the "class struggle" involves the ongoing brutal conflict between those who most benefit from the system of mass democratic, special interest-dominated, welfare-warfare corporate statism on one hand and those who are most victimized by it on the other hand. (7 (http://www.anti-state.com/article.php?article_id=316#7))

As a revolutionary anarcho-socialist, I aim to abolish the state’s military forces, police, courts, prisons, schools, social engineering programs, welfare system, corporate charters and corporate laws, anti-discrimination statutes, state ownership of land, currency monopoly, subsidies to infrastructure, regulatory agencies, trade restrictions, licensing schemes and so forth. In short, I aim to abolish the state altogether. On this point, market anarchists and I would agree. However, I also wish to go a step further and convert from an economic order where capital commands labor to one where labor commands capital. The pertinent question at this point is the matter of how this can be done without a coercive state apparatus. Indeed, a systemic economic conversion of this type must be done non-coercively and without a state. Otherwise, the centralization of capital into the hands of the state would produce a new type of ruling class as we have seen in such political degenerations as the Soviet Union, Peoples’ Republic of China, Democratic Republic of Vietnam and so on.

I have noticed that many if not most market anarchists and libertarians take the corporate dominated economy for granted. For them, a "free market" is simply the present system minus taxes, welfare and government social service agencies. As a correlation to this, most anarcho-socialists foolishly reject the free market, viewing it as a source of "capitalist exploitation". But authentic free market economics provides the proper path to working class liberation. The removal of state-imposed impediments to economic activity – taxes, regulations, prohibitions, licenses, currency monopoly, patents, subsidies – would naturally result in the dramatic expansion of the quantity and variety of businesses, partnerships and entrepreneurial associations of virtually every kind. If mutual banks of the Proudhonian variety were allowed to issue private banknotes with the output of future production used as collateral, then the capacity for self-employment would be readily available for anyone with marketable skills. A dramatic increase in the number of businesses and employers would mean that workers would have a much larger number of potential employers to choose from in addition to greatly expanded opportunities for self-employment. This would in turn radically increase the bargaining power of workers in terms of their dealings with employers. The cost of wage labor would increase as the market for employees became drastically more competitive. Workers in large-scale industrial operations would have the option of demanding the right of self-management if they so desired and, given the expanded availability of credit and capital, workers would be able to buy out capitalists and essentially become their own employers. So the dominant forms of economic organization in an authentic free market would be worker-owned and operated industries, partnerships, cooperatives, a mass of small businesses, modestly sized private companies and self-employed persons. Industries that remained nominally owned by outside shareholders would largely function on a co-determined basis, that is, as partnerships between shareholders and labor with labor having the upper hand.(8 (http://www.anti-state.com/article.php?article_id=316#8)) So the traditional anarcho-syndicalist ideal of an industrial system owned and operated by the workers could, for the most part, be achieved in the context of a stateless free market.

Removal of statist obstacles to the creation of housing and health care and the production of services would simultaneously increase the supply and reduce the cost of such goods. As the overall cost of living declined, workers would be able to work less, retire at an earlier age or opt for part time employment. A stable currency would stall the advancement of inflation thereby increasing the security of elderly and retired persons.

Rents, mortage payments and credit debts would undergo an overall decrease and home ownership would become more accessible to the average working person. Greater accessibility to land resulting from the elimination of federal government and agribusiness related land monopolies and the application of the homesteading principle (or other principles) would result in the revival of traditional family farms. Similarly, a lowered cost of living would reduce the need for two-income households thereby reviving traditional households and increasing the degree of attentiveness of parents to children. It would probably take volumes to completely describe the effect that the removal of the state would likely have on the nature and structure of the economy and the types of institutions that might exist in an anarcho-socialist system. Suffice it to say that such a system would be as different from what we are familiar with as the current system is from the old feudal order.

The question of getting there from here is obviously a monumental one. Drastic reconstructions or alterations of social systems usually follow a crisis of some severe sort. The conversion to an entirely different order, of whatever kind, will likely occur after the current system has run its course. A social apocalypse of this type may not be that far away. Professor Hoppe has warned of the likely consequences of the path currently being pursued by the welfare-warfare corporate states of the advanced countries.(9 (http://www.anti-state.com/article.php?article_id=316#9)) As the liabilities of modern states for social insurance payments and public debts become ever more exorbitant, taxes and bureaucracy consume more and more of the gross national product, real wages and productivity decline, and currency devaluation continues, an eventual economic meltdown seems quite likely. These factors combined with military-imperial overstretch and persistent ethnic and cultural strife generated by the state’s "divide and conquer" strategy of population control may well result in an overall systemic collapse similar to that experienced by the communist states of the East. The type of politico-economic system that would emerge after such an event is obviously quite difficult to predict.

Like Confucious, Machiavelli and Hume before him, and Mises and Rothbard later on, Bakunin recognized that a natural aristocracy of cultural and intellectual leaders typically set the tone of the society. He conceived of the idea of "principled militants" leading large popular organizations and carrying out social reconstruction by example and inspiration. To some degree this was realized by the Bakuninist-influenced Spanish anarchist movement with the core of militants and intellectuals gathered around the Iberian Anarchist Federation (FAI) leading the much, much larger anarchist labor movement. The Velvet Revolutions of Eastern Europe featured intellectuals such as Vaclav Havel as de facto leaders of a broader popular revolt. Hoppe specifically recommended the application of a modified version of the traditional syndicalist program to the economies of the Eastern European nations.(10 (http://www.anti-state.com/article.php?article_id=316#10)) They would have done well to heed his advice. Following a similar revolution in the West, popular organizations would have to emerge whose leaders were committed to anarchist objectives.

There are "non-market" anarcho-socialists as well as advocates of the "free market socialism" that I have outlined above. Prototypes for non-market socialism already exist in the form of the various intentional communities to be found here and there. There is such a community about an hour’s drive from my residence that has been in existence for about thirty years and maintains a steady population of about one hundred or so. It is possible that communes of a hundred people could be grouped together with one another into larger units of, say, ten communes who were then federated with ten other groups of ten communes and so on thereby creating a fairly large anarcho-communist federation involving tens of thousands of people. However, the larger such activities became the more an explicit market would be needed for the determination of prices and the productive allocation of resources. I have come across some anarcho-communists who believe it is possible to have a global communist system that includes a form of central planning that does not involve a state, but the less said about such ideas the better, in my view. (11 (http://www.anti-state.com/article.php?article_id=316#11))

The sustainability of a socialist-anarchist economy would largely be dependent upon the natural system of checks and balances resulting from the dramatic alteration of the labor market that would occur following the abolition of the state. Additional checks and balances might involve the making of shares in worker owned industries non-marketable and the defining of property rights according to usufructuary (ownership based on use and occupation) rather than Lockean principles as an impediment to the centralization of control over resources. It is on this point that there is likely to be the greatest amount of disagreement between anarcho-socialists and market anarchists. I believe the two can co-exist. The overall society-wide meta-system that I favor is one of local option. Some communities could choose to recognize absentee ownership rights while others might not. The end result might be a geographical division similar to that found in the current American states where local laws pertaining to capital punishment, gambling, the regulation of alcohol, etc. differ from place to place. Other issues on which anarchists and libertarians often disagree – abortion, animal rights, ecology, children’s rights – might be handled in a similar manner. Lastly, it is widely recognized that the survival of any social system is largely dependent on, first, the consensus of the cultural and intellectual elite, and, secondly, popular opinion. Over time, customs, traditions and habits might develop that were conducive to the maintenance of the anarchist system through diffuse sanctions and social pressure. As Jefferson said, "Eternal vigilance is the price of liberty."

As for the specific question asked by a reader related to the issue of how a Wal-Mart or McDonald’s might be communalized, I am skeptical as to whether or not large retail and fast food chains of the type we are currently familiar with could even exist in a genuine free market. The success of these chains results from their ability to undercut their local competitors with lower prices. But their lower prices are possible only because of the massive state subsidies to trucking, shipping, infrastructure, aviation, etc. If such corporations had to cover their own costs in these areas, they might not be able to compete with local alternatives.(12 (http://www.anti-state.com/article.php?article_id=316#12))

Barring such a scenario, however, I suspect these industries might be "communalized" through either an employee buyout or through implementation of a general strike for worker self-management. There is also the possibility of a buyout by federations of community, environmental, consumer and other types of popular organizations. Saul Alinsky once envisioned an industrial system where large groups of small shareholders meet in stadiums to determine corporate policy. Whether this would be feasible or not, I’m not sure. But it’s an interesting idea.

Lastly, let me say that I consider market anarchists and other libertarians to be valuable and reliable allies in the broader struggle against the state itself. I regard this struggle as the overriding priority. I believe there is plenty of room for different economic beliefs and institutions to co-exist just as it is possible for a plurality of cultures, religions and ethnic groups to co-exist as well. I am sympathetic to anyone who is in sincere opposition to what Nock described as "our enemy, the state". To use a slogan that some would regard as an oxymoron, "Anarchists Unite!"

Notes:
(1) Noam Chomsky, Secrets, Lies and Democracy
(2) Kevin A. Carson, "The Iron Fist Behind the Invisible Hand" (http://flag.blackened.net/daver/anarchism/iron_fist.html)
(3) Incidentally, Bakunin believed the federalist structure of the Confederate States of America to be a prototype for a decentralized anarchist federation, a fact that would make most of today’s politically correct anarcho-leftoids gag if they were aware of it.
(4) Kevin A. Carson, "Liberalism and Social Control: The New Class’ Will to Power" (http://www.attackthesystem.com/newclass.html)
(5) Charley Reese, 6/10/02 column. (http://reese.king-online.com/Reese_20020610/index.php)
(6) Quoted in "Liberalism and Social Control", by Carson
(7) I have discussed some of these matters in several other essays. See "Conservatism is Not Enough" (http://www.attackthesystem.com/conservatism.html), "Anarchism or Anarcho-Social Democracy" (http://www.attackthesystem.com/anarchism2.html)and "Reply to Brian Oliver Sheppard’s ‘Anarchism Vs. Right-Wing Anti-Statism" (http://www.attackthesystem.com/reply.html)at www.attackthesystem.com/commentary.html (http://www.attackthesystem.com/commentary.html)
(8) "Iron Fist", by Carson. See also my review of Carson, "Capitalism Versus Free Enteprise" (http://www.attackthesystem.com/capitalism.html)
(9) Hans Hermann Hoppe, "Democracy: The God That Failed". See my review of Hoppe at www.anti-state.com/preston/preston2.html (http://www.anti-state.com/preston/preston2.html) or www.attackthesystem.com/hoppe.html. (http://www.attackthesystem.com/hoppe.html)
(10) "Democracy", by Hoppe.
(11) For an example of this see "The Northeastern Anarchist: Magazine of the North Eastern Federation of Anarchist-Communists", Spring/Summer 2002.
(12) "Iron Fist", by Carson.
September 12, 2002

Source (credit where it's due)
(http://www.anti-state.com/article.php?article_id=316)

IcarusAngel
6th September 2009, 01:23
Good post. Well sourced and to the point. It's interesting to see Secrets, Lies, and Democracy in there as that book - like most of the author's books - is primarily about US hegemony and elite, corporate class rule. Still it manages to fit in there perfectly.

I'll have more to say later.

These type of well thought out posts are rarely seen on the internet today though, and I think that's another triumph of the right, to move debate to the lowest common denominator.

Havet
7th September 2009, 12:02
Good post. Well sourced and to the point. It's interesting to see Secrets, Lies, and Democracy in there as that book - like most of the author's books - is primarily about US hegemony and elite, corporate class rule. Still it manages to fit in there perfectly.

I'll have more to say later.

These type of well thought out posts are rarely seen on the internet today though, and I think that's another triumph of the right, to move debate to the lowest common denominator.

Thank you. Besure to say more later!

1billion
10th September 2009, 04:51
very nice post I like how you use Hoppe and Chomsky in the same paper, good to see you keep an open mind:)

Havet
19th September 2009, 14:27
very nice post I like how you use Hoppe and Chomsky in the same paper, good to see you keep an open mind:)

Thanks!

Now, last bump

Kwisatz Haderach
19th September 2009, 22:00
Well, you get points for the effort (are you the author of this piece, or is someone else?). But the ideas in it are ridiculous and dangerous for the left.

A free market in any good necessarily leads to the concentration of that good in few hands. Furthermore, there are economies of scale in most industries, which means that large firms are simply more efficient and more productive than small firms. Some "anarchists" seem to have an absurd fetish for a society run by the petty bourgeoisie - a society of small, "local" firms. Such a society is incompatible with the industrial revolution.

Large-scale production is better than small-scale production. Now, it is true that, in the service sector, economies of scale are usually less pronounced than in industry. In the service sector it does make sense to have small firms (sometimes). But you can't run an economy entirely on the service sector. The service sector in the United States and Europe today is deceptively large, and it is kept that large only by the system of state-regulated international trade that allows the West to relocate its industries in India and China. If your system would make Wal-Mart uncompetitive, then in the same way it would also make the import of industrial products from China uncompetitive, meaning that your country would need to reindustrialize, meaning that you'd have to give up your dream of an economy run by small businesses.

And, of course, since industry must always exist somewhere, a petty bourgeois economy is always impossible on a planetary scale.

IcarusAngel
20th September 2009, 08:16
They mean free trade in the sense that you aren't restricted from trading. That generally is pro-left.

If large industries are needed, these could also be run by various vactions that are part of the whole. To keep it 'left' the society would try to ensure that most people's needs are met and that they can pursue their own interests.

I agree that capitalist property relations tend towards inequality but without capitalist restrictions and property there would be true individualism and freedom and that is the line of reasoning here. I think the term 'free-market' is too loaded to even continue to use though. I think anarcho-capitalists should just advocate a 'free-society' or even a 'free-economy,' or have you.

Devon
20th September 2009, 08:57
IcarusAngel, don't mention it if you're an anarcho-capitalist. Note this website is called revleft.com, meaning revolutionary socialism of all kinds, all anti-capitalists. You might start a flame war. But then maybe people are more tolerant than I suppose. Ha :).

Kwisatz Haderach
20th September 2009, 10:39
They mean free trade in the sense that you aren't restricted from trading. That generally is pro-left.
No, not as long as the thing being traded is private property.


If large industries are needed, these could also be run by various vactions that are part of the whole. To keep it 'left' the society would try to ensure that most people's needs are met and that they can pursue their own interests.
Large industries are needed - there is no "if" about it - unless future technological progress renders them obsolete. But we can't really guess what future technology will be like.

But yes, you are correct that society should ensure that people's needs are met and that they can pursue their own interests. This is precisely why we need a planned economy. A society where different self-interested groups run different segments of the economy will never be a free society, unless by some amazing stroke of fortune those different groups happen to be perfectly balanced in terms of power and wealth.


I agree that capitalist property relations tend towards inequality but without capitalist restrictions and property there would be true individualism and freedom and that is the line of reasoning here. I think the term 'free-market' is too loaded to even continue to use though. I think anarcho-capitalists should just advocate a 'free-society' or even a 'free-economy,' or have you.
The term "free market" may be loaded, but it is accurate. A market is a social relationship based on the trading of private property between independent self-interested entities. And this is precisely what "anarcho"-capitalists want. Not a free society, but a society based upon private property.

Havet
20th September 2009, 12:59
No, not as long as the thing being traded is private property.

What if the thing being traded is possession (http://en.wikipedia.org/wiki/Mutualism_%28economic_theory%29#Property) and not property?


This is precisely why we need a planned economy. A society where different self-interested groups run different segments of the economy will never be a free society, unless by some amazing stroke of fortune those different groups happen to be perfectly balanced in terms of power and wealth.

Any proof of that?

A planned economy necessarily concentrates too much power on the planners, which necessarily hold the monopoly over ALL the society's resources. Eventually they won't care about the people and use that power to their own benefit exclusively.

How can different self-interested groups trading between each other is not a free society? Why should we all obey to these all-powerful planners and be at their mercy?

Doesn't freedom include the freedom to have a different interest at all, so long as that interest does not restrict others to follow theirs?


The term "free market" may be loaded, but it is accurate. A market is a social relationship based on the trading of private property between independent self-interested entities. And this is precisely what "anarcho"-capitalists want. Not a free society, but a society based upon private property.

True, that's what anarcho-capitalists want. That does not mean they are correct on their prediction of what a truly free-market will resemble.

Like I said, one can trade possessions, and I can hardly believe you would have anything against a community which decided through majority vote to keep the private property system without the formal State we know of, but instead using other entities (take citizen militias for example) to take care of those who disrespect the commonly agreed upon rules of that community, just as you wouldn't have anything against a community which decided through majority vote to keep all property communal.

If they (the people who form the community and the people around the community) commonly agree that the community owns the land, then they necessarily agree that they can impose certain restrictions within that community land, but not outside of it.

Havet
20th September 2009, 17:01
as far as your first post goes


Well, you get points for the effort (are you the author of this piece, or is someone else?). But the ideas in it are ridiculous and dangerous for the left.

A free market in any good necessarily leads to the concentration of that good in few hands. Furthermore, there are economies of scale in most industries, which means that large firms are simply more efficient and more productive than small firms. Some "anarchists" seem to have an absurd fetish for a society run by the petty bourgeoisie - a society of small, "local" firms. Such a society is incompatible with the industrial revolution.

Large-scale production is better than small-scale production. Now, it is true that, in the service sector, economies of scale are usually less pronounced than in industry. In the service sector it does make sense to have small firms (sometimes). But you can't run an economy entirely on the service sector. The service sector in the United States and Europe today is deceptively large, and it is kept that large only by the system of state-regulated international trade that allows the West to relocate its industries in India and China. If your system would make Wal-Mart uncompetitive, then in the same way it would also make the import of industrial products from China uncompetitive, meaning that your country would need to reindustrialize, meaning that you'd have to give up your dream of an economy run by small businesses.

And, of course, since industry must always exist somewhere, a petty bourgeois economy is always impossible on a planetary scale.

Again, this fundamentally comes down to a few state-socialist economic myths, namely money pie.

In reality its quite the opposite, the fact that a few large companies can handle oil (which is government regulated), mining (which is government regulated), means more wealth to be spent on smaller markets.

Just as the development of the machine loom reduced cost of cloth for normal people (leaving them more money), and allowed the same amount of cloth to be made with 1/10th the workforce (leaving more workers free to work other businesses.

Of course, I could just use the stats that there are more businesses now than ever before (well there's a slight dip because of the government bank collapses), though facts don't really do much to win an argument, as it so appears around here.

Also the assumption that all businesses benefit from economies of scale is sheer bullshit.
(http://en.wikipedia.org/wiki/Diseconomies_of_scale)
Some of the most profitable businesses in the world per man hour have less than 10 people working for them.

Extreme luxury items like watches are a good example of this, but also precision engineering. As an example, a friend of mine's brother is a big fan of aerodynamics/biking, and he told him this bike was made by 1 man in his shed, (http://en.wikipedia.org/wiki/Britten_V1000) and at the time it was one of the best motorbikes in the world, I believe its value is up in the millions of dollars.

Also to assume that all small businesses would be wiped out is ridiculous, since nearly all businesses that are now large where once small and had to beat competition.

Tesco (http://en.wikipedia.org/wiki/Tesco#History) is a perfect example. Now its the biggest retail business in the entire of the UK. 1 in 8 pounds spent in the UK is spent in tesco.

But it started with one man selling excess fruit and vegetables at a market stall, then it developed into 1 store, now its hundreds of stores.

In its way it had to beat dozens of other business, of which many it bought out.

Did Jack Cohen ***** about how it was unfair that bigger businesses benefit from economies of scale? No. He got off his ass and he got to work.

If what the state-socialists said was right, larger businesses like Sainsburies (http://en.wikipedia.org/wiki/Sainsbury%27s#Sainsbury.27s_downfall) would have crushed Tesco with "unfair" business practises before it was even half the size of Sainsburies.

But of course thats not how business works, you can't just beat another business because you want to, and having all the money in the world doesn't mean you can always make the most profit (although of course it helps).

To quote Gordon Gecko, either you do it right, or you get eliminated.

In business being big also means having lots of inertia. Its hard to lose alot of money fast, but if you are losing money its hard to turn around the business back into profit.

Sainburies lost out to Tesco precisely because it was big, and no longer had the drive to innovate in the market place.

And in time some other company will overtake Tesco, as is the nature of the market.

But you can't run an economy
entirely on the service sector. The service sector in the United
States and Europe today is deceptively large, and it is kept that
large only by the system of state-regulated international trade that
allows the West to relocate its industries in India and China

Sheer bullshit. Where do Chinese and India make all their money? From USA and Europe.

If USA and Europe weren't "exploiting" China, who would China sell to? In short, no one. All those millions of factory workers would be back ploughing fields and rearing cattle, not building TVs, electric guitars and millions of other high price products.

To the extent that they ARE being exploited, that is another discussion altogether. But to claim they would never benefit from this vaguely free market already is also a wrong assumption.

Now China and to a lesser extent India are getting richer faster than western countries precisely because western countries are disrupting the production of wealth through excessive market and worker exploitation.

If you want to talk about "good in the hands of the few", China and India both have the fastest growing number of millionaires on the planet, although they still are a long way from stoping being exploited by their religion, their governments and, to some extent, foreign corporations.

The gap between rich and poor is getting bigger at a massive rate in China, but outside the present exploitation which is present ALL around the world, this gap has also brought many advantages.

40 years ago everyone was poor, now millions of people have enough money to have electricity and motor cars (http://www.greencarcongress.com/2006/05/percapita_car_o.html).

The statistic that state-socialists always want to hide when they bring out the "gap between rich and poor growing" is that usually the poor are getting richer faster than they've ever been.

Anyway, this leads me to YET ANOTHER state-socialist myth. That there need to be "workhorse" countries like China, in order for there to be rich countries like USA.

Of course this is a nonsense. the USA was lapping up motor cars and televisions while China was still murdering and starving millions of its own people.

The idea that there is somehow a static amount of production possible is, with all respect, nonsense.

How did we ever free up workers from hand looming?

The reason the Service industry is big is not because of some market distortion of reality, its because that's whats really important and profitable to people.

While food and mining might seem so important to state-socialists, its really not. People don't want to live for the sake of food and mining. The reason why modern economies have a huge percentage of service and a tiny percentage of primary industry, is because its simply not that profitable.

We have pretty much less farmers now than we ever had, yet we have far more food production than ever before. How is this possible? The same way that the machine loom cut the amount of workers needed and boosted the amount of production.

Of course we benefit from other countries that still have a huge portion of industrial business, why wouldn't we? They have much cheaper land and taxes.

What a Chinese person can't (yet) do is take your order at a US restaurant, or design a computer game, or make a film.

And these are all far more valuable, and more importantly harder to do than primary industry jobs.

State-socialists always like to look at wealth generation terms of EFFORT rather than SCARCITY. Which of course leads to the faulty labor model of wealth generation.

Brain surgery isn't well paid because it takes a lot of effort, its well paid because not many people can do it, which is because generally its hard to learn and be good at, and it takes a lot of money to learn.

But its faulty logic to then assume that anything that takes a lot of effort must be valuable.

A chinaman breaking his back moving sheet metal in a factory might expend alot of EFFORT, but it is not a scarce skill.

As you said, if all the other countries packed up production, then we would have to increase our industrialization. But pretty much everyone can do that kind of work, so its not very valuable, which is why we don't have much industrialization.

Why compete with a Chinese man making $2 an hour when you can choose work that few chinese men are capable of and make $10 an hour?

Here in western countries, we have so much money we can take our time learning how to design things, learning about arts and history. In China they have to scrabble around just to get food and clothes.

But of course, they won't and aren't spending life like that for long. As soon as you have made enough money to feed yourself and cloth yourself, you can move on to bigger things, which is why there is now a record number of millionaires in China.

Just as the 1st generation of Americans toiled the land, the 2nd generation toiled in factories, so that the 3rd generation could enjoy the relative ease of service work.

What anti-free-market people (not the free market as ancaps paint it, mind you) don't see is that the market is a massive equalizer in terms of opportunity.

I predict that in 100-200 years the world's markets will be practically indistinguishable. Not that we won't have cultural differences, but ordinary people will be on a much more higher level playing field.

As the Chinese and Indians bring themselves up, eventually they'll start competing at things that where once only the domain of western countries.

Already it has happened with places like South Korea, which are pretty fucking similar to western countries.

So we'll see a much more even breakdown of % industries. Primary industries will become an even smaller part of the economy, as newer technology means more ore and food can be produced for even less effort.

But we'll likely see an explosion of art and science from places like India and China, just as we have from America and Japan when they got rich enough so that they could focus on things other than the bare essentials.

trivas7
21st September 2009, 15:48
And, of course, since industry must always exist somewhere, a petty bourgeois economy is always impossible on a planetary scale.
And, of course, since free trade must always exist somewhere, a socialist economy is always impossible on a planetary scale.

Re the OP, the author is a dreamer; he has no clue how to get to "an economic order of small businesses and self-employed persons, cooperatives, worker owned/managed industries, Proudhonian banks and other similar institutions operating within the context of a lassez-faire, stateless, free market."

Conquer or Die
22nd September 2009, 01:55
Anarcho-anything is impossible because everything becomes centralized. I'm extremely happy that Bakunin liked the actions of the Confederate States of America because it proves the untenability of his position and the anarchist position in general. The Confederate States of America was created in response to the lack of the federal government enforcing slavery laws and denying the expansion of slavery into other territories. The CSA invoked the articles of confederation and constitution as a political justification for the war in order to gain a legitimacy nationally and internationally. Of course, while the CSA seceded from the union, its military and political system was incredibly centralized, so much so that the governor of Arkansas threatened to secede from the CSA after the Union overrun his state early in the war and he was laughed out of Richmond. The CSA engaged in conscription, resource raids, and sanctioned state terrorism and the execution of traitors to the cause of the South. There was hardly anything decentralized about the system as it struggled to survive and expand its interest.

There is only one type of anarchy and that is of the Max Stirner variety.

spice756
22nd September 2009, 03:35
Again, this fundamentally comes down to a few state-socialist economic myths, namely money pie.
In reality its quite the opposite, the fact that a few large companies can handle oil (which is government regulated), mining (which is government regulated), means more wealth to be spent on smaller markets.


Where do they spend wealth on smaller markets? I don't think large companies will give money to smaller markets for free just to help them out.





Just as the development of the machine loom reduced cost of cloth for normal people (leaving them more money), and allowed the same amount of cloth to be made with 1/10th the workforce (leaving more workers free to work other businesses.
Of course, I could just use the stats that there are more businesses now than ever before (well there's a slight dip because of the government bank collapses), though facts don't really do much to win an argument, as it so appears around here.
Also the assumption that all businesses benefit from economies of scale is sheer bullshit.



Only becuse tenolagy not the businesses




Some of the most profitable businesses in the world per man hour have less than 10 people working for them.
Extreme luxury items like watches are a good example of this, but also precision engineering. As an example, a friend of mine's brother is a big fan of aerodynamics/biking, and he told him this bike was made by 1 man in his shed, and at the time it was one of the best motorbikes in the world, I believe its value is up in the millions of dollars.


I don't see to many people with those old watches most are electronic watches.





Also to assume that all small businesses would be wiped out is ridiculous, since nearly all businesses that are now large where once small and had to beat competition.
Tesco is a perfect example. Now its the biggest retail business in the entire of the UK. 1 in 8 pounds spent in the UK is spent in tesco.
But it started with one man selling excess fruit and vegetables at a market stall, then it developed into 1 store, now its hundreds of stores.
In its way it had to beat dozens of other business, of which many it bought out.
Did Jack Cohen ***** about how it was unfair that bigger businesses benefit from economies of scale? No. He got off his ass and he got to work.



It called law .The goverment will help small businesses owners not like before.





If what the state-socialists said was right, larger businesses like Sainsburies would have crushed Tesco with "unfair" business practises before it was even half the size of Sainsburies.
But of course thats not how business works, you can't just beat another business because you want to, and having all the money in the world doesn't mean you can always make the most profit (although of course it helps).
To quote Gordon Gecko, either you do it right, or you get eliminated.
In business being big also means having lots of inertia. Its hard to lose alot of money fast, but if you are losing money its hard to turn around the business back into profit.




Why has no one beat Microsoft or yahoo / google ?

Havet
23rd September 2009, 19:45
Well there seems to be some misunderstanding with the covnersation which is understandable given my ambiguous wording.


Where do they spend wealth on smaller markets? I don't think large companies will give money to smaller markets for free just to help them out.

This (what you quoted from me) makes it seem like I mean large companies will make money and give it to other companies.

By "more wealth to be spent on smaller markets", I meant more wealth as a proportion of total wealth.

I.e. If All people do is mine coal and grow crops, then thats all wealth can be spent on. But if 1% of people mine coal and grow crops, that allows 99% of other people to do other things which wealth can be spent on.

Or more simply:

The more efficient an industry is, the more labor, land and resources are free to be spent in other markets.

This is goes down to a key principle of marketing, and economics, of market division.

When the first motocar was invented, the entire motor car market was a tiny percentage. Then as the motorcar market grew, there became enough wealth for sub markets to emerge.

Not only does this happen within markets, but it happens across markets.

Mining iron ore allows for production of iron bars which allows for production of steel, which allows production of steel machine tools, which allows for production of consumer goods, consumer goods allow business to repair those consumer goods which.

Basically its an inverse of the Broken window fallacy. While breaking a window might provide "work", it destroys wealth. Producing wealth is the real benefit the broken window fallacy seeks.

By producing one item of wealth, that allows other people to create more items of wealth, creating a virtuous circle of wealth production, which is why we are hundreds of times richer than we were 100 years ago, and we will be thousands of times richer 100 years from now.

Of course this is incredibly complex for anyone with no knowledge of economics to try and understand.


Only becuse tenolagy not the businesses

Well, only a state-socialist could make that distinction. Who is it that created the machines? Who trained the workers to use the machines? Who built the building to house the machines? Who built the generator to power the machines? Who found a supplier for the cotton? Who found a buyer for the finished cloth?

State-Socialists tend to have an extremely naive attitude towards business, that there are all these great things in the world, and businessmen are people who try to get between you and the great things that by right should come to you for free (of course, there are SOME businessmen like that, but most aren't).

Obviously no state-socialist is the kind of people who could have ever revolutionized the textile industry this way.

And lets not forget, the machine loom was a catalyst for so many different inventions and industries.

Machine looms required power to run, which led to water wheels and valves, when there wasn't sufficient water power, coal was used to generate steam to power the machines, that technology was then used to make steam engines, which same technology was used to make combustion engines, all of which allowed for massive amounts of trade and transportation to occur.


I don't see to many people with those old watches most are electronic watches.

What an ignorant statement.

All these watches thousands of pounds and are not digital. (http://www.google.co.uk/products?client=firefox-a&rls=org.mozilla:en-US:official&channel=s&hl=en&source=hp&q=rolex%20watch&um=1&ie=UTF-8&sa=N&tab=wf) This seems to be another naive assumption, that somehow its better to sell more cheap things than less expensive things.

When you compete on price you are constantly driving your prices lower due to competition, which means you constantly have to fight to make the same amount of money.

chinese sell a digital watch for maybe $1 wholesale, and costs maybe $0.50 cents to make. This means they have to sell an awful lot of watches just to cover the overheads of the business.


Why has no one beat Microsoft or yahoo / google ?

Are you aware that Yahoo was the biggest search engine, and google started from nothing and over took it?

And Microsoft has its lowest market share in nearly its entire history, its profits are dropping like a rock and the only reason its managed to compete this far is because of government copyright laws that prevent other businesses from copying Microsoft?

not that any of this matters. All of your answers betray the fact that you're interested in questioning your unreasonable beliefs through facts.

Liche
27th September 2009, 23:11
Very interesting. I really like how you sited your notes. I think if more people realized how few people really had power they would be more open to socialism, and thing revolution would be possible. I think they should be teaching this information in middle and highschool, it certainly would of helped. When I first took civics class in 8th grade, I liked free market, because the books taught us that thats were people had absolute power. It said Communism was when the government controlled everything. Ironically, later that year is when I read the Communist Manifesto (note that this was on my own time) and considered my self a socialist.

Havet
2nd October 2009, 18:02
Very interesting. I really like how you sited your notes. I think if more people realized how few people really had power they would be more open to socialism, and thing revolution would be possible. I think they should be teaching this information in middle and highschool, it certainly would of helped. When I first took civics class in 8th grade, I liked free market, because the books taught us that thats were people had absolute power. It said Communism was when the government controlled everything. Ironically, later that year is when I read the Communist Manifesto (note that this was on my own time) and considered my self a socialist.

thanks for the support