An Anarchist Economy

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How an anarchist economy would work... Many people say that oh it wouldn't work, but with a true, non state-enforced education, you can see that it could.

Transcript of An Anarchist Economy

I.1.3 What is wrong with markets anyway?A lot. Markets soon result in what are termed"market forces,"impersonal forces which ensure that the people in the economy do what is required of them in order for the economy to function. The market system, in capitalist apologetics, is presented to appear as a regime of freedom where no one forces anyone to do anything, where we "freely" exchange with others as we see fit. However, the facts of the matter are somewhat different, since the market often ensures that people act in waysoppositeto what they desire or forces them to accept "free agreements" which they may not actually desire. Wage labour is the most obvious example of this, for, as we indicated insection B.4, most people have little option but to agree to work for others.We must stress here that not all anarchists are opposed to the market. Individualist anarchists favour it while Proudhon wanted to modify it while retaining competition. For many, the market equals capitalism but this is not the case as it ignores the fundamental issue of (economic) class, namely who owns the means of production. Capitalism is unique in that it is based on wage labour, i.e. a market for labour as workers do not own their own means of production and have to sell themselves to those who do. Thus it is entirely possible for a market to exist within a society and for that societynotto be capitalist. For example, a society of independent artisans and peasants selling their product on the market would not be capitalist as workers would own and control their means of production. Similarly, Proudhon's competitive system of self-managed co-operatives and mutual banks would be non-capitalist (and socialist) for the same reason. Anarchists object to capitalism due to the quality of the social relationships it generates between people (i.e. it generates authoritarian ones). If these relationships are eliminated then the kinds of ownership which do so are anarchistic. Thus the issue of ownership matters only in-so-far it generates relationships of the desired kind (i.e. those based on liberty, equality and solidarity). To concentrate purely on "markets" or "property" means to ignore social relationships and the key aspect of capitalism, namely wage labour. That right-wingers do this is understandable (to hide the authoritarian core of capitalism) but why (libertarian or other) socialists should do so is less clear.In this section of the FAQ we discuss anarchist objections to the marketas suchrather than the capitalist market. The workings of the market do have problems with them which are independent of, or made worse by, the existence of wage-labour. It is these problems which make most anarchists hostile to the market and so desire a (libertarian) communist society. So, even if we assume a mutualist (a libertarian market-socialist) system of competing self-managed workplaces, then communist anarchists would argue that market forces would soon result in many irrationalities occurring.Most obviously, operating in a market means submitting to the profit criterion. This means that however much workers might want to employ social criteria in their decision making, they cannot. To ignore profitability would cause their firm to go bankrupt. Markets, therefore, create conditions that compel producers to decide things which are not be in their, or others, interest, such as introducing deskilling or polluting technology, working longer hours, and so on, in order to survive on the market. For example, a self-managed workplace will be more likely to invest in safe equipment and working practices, this would still be dependent on finding the money to do so and may still increase the price of their finished product. So we could point to the numerous industrial deaths and accidents which are due to market forces making it unprofitable to introduce adequate safety equipment or working conditions, (conservative estimates for industrial deaths in the USA are between 14,000 and 25,000 per year plus over 2 million disabled), or to increased pollution and stress levels which shorten life spans.This tendency for self-managed firms to adjust to market forces by increasing hours, working more intensely, allocating resources to accumulating equipment rather than leisure time or consumption can be seen in co-operatives under capitalism. While lacking bosses may reduce this tendency in a post-capitalist economy, it will not eliminate it. This is why many socialists, including anarchists, call the way markets force unwilling members of co-operatives to make such unpleasant decisions a form of "self-exploitation" (although this is somewhat misleading, as there no exploitation in the capitalist sense of owners appropriating unpaid labour). For communist-anarchists, a market system of co-operatives"has serious limitations"as"a collective enterprise is not necessarily a commune -- nor is it necessarily communistic in its outlook."This is because it can end up"competing with like concerns for resources, customers, privileges, and even profits"as they"become a particularistic interest"and"are subjected to the same social pressures by the market in which they must function."This"tends increasingly to encroach on their higher ethical goals -- generally, in the name of 'efficiency', and the need to 'grow' if they are to survive, and the overwhelming temptation to acquire larger earnings."[Murray Bookchin,Remaking Society, pp. 193-4]Similarly, a market of self-managed firms would still suffer from booms and slumps as the co-operatives response to changes in prices would still result in over-production (seesection C.7.2) and over-investment (seesection C.7.3). While the lack of non-labour income would help reduce the severity of the business cycle, it seems unlikely to eliminate it totally. Equally, many of the problems of market-increased uncertainty and the destabilising aspects of price signals discussed insection I.1.5are just as applicable to all markets, including post-capitalist ones.This is related to the issue of the"tyranny of small decisions"we highlighted insection B.6. This suggests that the aggregate effect of individual decisions produces social circumstances which are irrational and against the interests of those subject to them. This is the case with markets, where competition results in economic pressures which force its participants to act in certain ways, ways they would prefer not to do but, as isolated individuals or workplaces, end up doing due to market forces. In markets, it is rational for people try to buy cheap and sell dear. Each tries to maximise their income by either minimising their costs or maximising their prices, not because they particularly want to but because they need to as taking into account other priorities is difficult as there is no means of finding them out and deeply inadvisable as it is competitively suicidal as it places burdens on firms which their competitors need not face.As we noted insection E.3, markets tend to reward those who act in anti-social ways and externalise costs (in terms of pollution and so on). In a market economy, it is impossible to determine whether a low cost reflects actual efficiency or a willingness to externalise, i.e., impose costs on others. Markets rarely internalise external costs. Two economic agents who strike a market-rational bargain between themselves need not consider the consequences of their bargain for other people outside their bargain, nor the consequences for the earth. In reality, then, market exchanges are never bilateral agreements as their effects impact on the wider society (in terms of, say, pollution, inequality and so on). This awkward fact is ignored in the market. As the left-wing economist Joan Robinson put it:"In what industry, in what line of business, are the true social costs of the activity registered in its accounts? Where is the pricing system that offers the consumer a fair choice between air to breath and motor cars to drive about in?"[Contribution to Modern Economics, p. 10]While, to be fair, there will be a reduced likelihood for a workplace of self-employed workers to pollute their own neighbourhoods in a free society, the competitive pressures and rewards would still be there and it seems unlikely that they will be ignored, particularly if survival on the market is at stake so communist-anarchists fear that while not having bosses, capitalists and landlords would mitigate some of the irrationalities associated with markets under capitalism, it will not totally remove them. While the market may be free, people would not be.Even if we assume that self-managed firms resist the temptations and pressures of the market, any market system is also marked by a continuing need to expand production and consumption. In terms of environmental impact, a self-managed firm must still make profits in order to survive and so the economy must grow. As such, every market system will tend to expand into an environment which is of fixed size. As well as placing pressure on the planet's ecology, this need to grow impacts on human activity as it also means that market forces ensure that work continually has to expand. Competition means that we can never take it easy, for as Max Stirner argued,"[r]estless acquisition does not let us take breath, take a calmenjoyment. We do not get the comfort of our possessions . . . Hence it is at any rate helpful that we come to an agreement abouthumanlabours that they may not, as under competition, claim all our time and toil."[The Ego and Its Own, p. 268] Value needs to be created, and that can only be done by labour and so even a non-capitalist market system will see work dominate people's lives. Thus the need to survive on the market can impact on broader (non-monetary) measures of welfare, with quality of life falling as a higher GDP is created as the result of longer working hours with fewer holidays. Such a regime may, perhaps, be good fo