Anarchoblogs

I attempted to leave a comment under "Help the World's Poor: Buy Some New Clothes," by an economics professor named Benjamin Powell. Since the comments system ate it (Database Error), I'm posting it here.

You can Google sweatshops+"best available alternative" and come up with thousands of hits for such by-the-numbers polemics.

I dealt with it extensively here.

Your celebration of the capital investment brought in by sweatshops is a classic example of Bastiat's broken window fallacy.

By definition, anything anyone does in a situation where there is a choice between more than one alternative is the "best available alternative." The question you should be asking is: why is the range of available alternatives so crappy in the first place? And a big part of the answer is the role of Third World states in carrying out land expropriations on the model of the English Enclosures, to drive peasants off their land and coerce them into the wage labor market. Third World states also play a major role in enforcing draconian restrictions on labor organization, tax their own people to provide subsidized road and utility infrastructure to offshored foreign industry, turn the peasants' confiscated common lands into industrial parks, and enforce the anti-market "intellectual property" [sic] laws without which the Nike model of outsourcing everything but marketing and finance would be impossible.

And Western capital is engaged in no small collusion with Third World states in guaranteeing a set of conditions under which workers accept employment on whatever terms are offered as the "best available alternative."

Western employers are engaged in parasitic activity, profitably selling crutches to people whose legs were broken by their partners in crime -- Third World states. (Never mind the role of the American state in backing death squads and military dictators to stop land reforms and make the world safe for corporate power, to subsidize the export of capital with World Bank loans for infrastructure, and to impose stuff like the Uruguay Round TRIPS Accords on the rest of the world).

You should be asking yourself how labor and capital would be directed in Third World countries if it weren't for all those broken windows.

Instead of praising sweatshop employers, we should be promoting a real free market agenda. Give the land back to the peasants it was stolen from. Privatize state industry by turning it into worker cooperatives, and privatize utilities and other services by transforming them into consumer co-ops -- instead of selling them off to a politically connected corporation. Repeal the WIPO Copyright Treaty and TRIPS, and withdraw ACTA from consideration.

Under a Matt Yglesias column calling for the deregulation of casket-making, one commenter -- Mark. R -- argued that free entry and price competition were overrated:

This is waaaaay too simplistic. Easy example: go back in history and think about The Jungle and what the spate of food safety laws eminating from that did to “Mom and Pop” meat production and competition in general in that industry. Killed it b/c the large cartels were best structured to conform and comply with new food safety regulations. Obviously the cartels consciously used this legislation and the legislative process to help kill the competition. Yet this was all for the public benefit.

Sometimes a well-regulated industry with minimal competition is the best outcome. Think of “natural monopolies” — e.g. public utilities — from micro 101.

I attempted to post a response, but Matt's stupid comment system -- once again -- ate my comment. So here it is:

You could make a case (although I wouldn't agree with it) that regulated monopolies are a necessary evil in terms of their external effects. That is, in regard to minimal safety standards for some goods and services.

But in terms of their internal culture, they are clearly evils. The regulated monopoly model is a very poor approach to cost control, because of all the assumptions regarding institutional culture that are taken for granted by both the regulatory agencies and regulated firms. I strongly recommend Paul Goodman's contrast (in People or Personnel) between ad hoc, bottom-up, self-managed organizations and the hegemonic norm of the giant corporation or government agency. The latter has prestige salaries, Weberian work rules, management featherbedding, mission statements, and everything else that's pathological about pointy-haired bossdom. The regulated monopoly is likely to have a high-overhead, cost-plus culture very much like the Pentagon contractors, which gave us the $600 toilet seat. And by its very nature, as Seymour Melman pointed out in his analysis of the military-industrial complex, cost-plus pricing systems like those that prevail in "regulated monopolies" create very perverse incentives for cost maximization. You wind up with internal organizational cultures like something out of "Brazil." The regulators who set the prices for the "regulated" monopoly are unlikely to squeeze out such bureaucratic overhead and management self-dealing, because regulators and regulated are both middle-aged white men who went to the same schools, share the same general institutional culture, wear suits and carry briefcases to work, etc. So most of the stuff that inflates overhead and causes stuff to cost 300% more than necessary is stuff that they accept as normal and it never occurred to them to question.

Mark R.'s position is a classic example of mainstream liberalism's Schumpeterian approach, which I described in "Thermidor of the Progressives": Only the large, bureaucratic, hierarchical and managerialist organization can afford to be "progressive," because only it possesses the market power to price above marginal cost and thereby pass the costs of its "progressive" culture along to the consumer. So you have the ideal of postwar Consensus Capitalism, where it's OK that GM owns the entire economy so long as Michael Moore's dad has a good union job, and it's OK that the "professional" gatekeepers at the Big Three control everything you watch so long as they're constrained by a Fairness Doctrine.

What it amounts to is that the state imposes artificial scarcity rents and artificial capital and overhead costs on the performance of every imaginable function, and it takes several times as many labor hours to produce our standard of living than is technically necessary; but everybody has 40 hr/week jobs with good benefits (even though most of their work hours are the equivalent of digging holes and filling them back in, or extra steps in a Rube Goldberg machine).

Today C4SS director Brad Spangler posted an appeal for help. It seems the low contributions so far for the July-August fundraiser (only 10% of the target) have him in a panic. He announced plans to cut back on some projected expansions (like cancelling a Radio Liberty advertising campaign in September), and to put our new commentator Stacy Litz on unpaid leave.

Tom Knapp promised to give back $100 of his monthly media coordinator salary -- which is hardly even a pittance even as it is, considering he has painstakingly compiled a distribution list of many hundreds of newspapers for submitting each and every new C4SS column. Tom's doing the kind of stuff people get paid high professional salaries for, and I'd say his performance stacks up very well against that of the pros.

I'm not as dedicated as Tom (business has been slow at my day job, and that $425 really helps with the bills), but I'm gonna subscribe for a regular $20 contribution myself -- just as soon as I get some money in the bank so the deduction doesn't bounce (hint, hint). And contributor Jock C. has promised to up his monthly contribution from $25 to $50 if ten more people sign up for monthly contributions of $10 or more.

Now that we seem to be hitting a wall for the time being in terms of limits on our expansion, it would be really great if the monthly subscriber base started catching up with our budget. As it is, that $300 in monthly subscriptions is a nice cushion, as a head start toward each month's fundraising goals. If we could meet a much larger percentage of our total budget, and smooth out the peaks and troughs a bit with dependable income, that would be even better. And it's a lot less hassle to have a modest sum like $10 or $20 deducted from your bank account every month, and feel virtuously entitled to sit back and ignore the beg-a-thons ("I already gave at the office, thanks.").

I've said this before, but if enough people subscribe, we might be able to stop these fund-raisers altogether. I'll bet if everybody who's ever contributed signed up for $10 or $20 a month, we'd be pretty close to fully funded on an ongoing basis. Imagine -- I know, I'm repeating myself -- if Jerry Lewis promised to go away forever if enough people subscribed for regular annual donations. The millions of people rushing to put their checks in the mail would probably put him over the top the next day.

Since Brad made his appeal today, the contributions have reached 28% of the goal (for which muchas gracias). That means we have enough now, at the end of August, to pay everybody for the work they did in July. Every month when we start one of these things, I wonder if I'm going to wind up writing for free a major part of the time, if we've finally reached the point where people have had enough of coughing up money. And I'd probably keep doing it if the money stopped coming in, as would most of us at C4SS. I may be stingier than Tom Knapp when it comes to giving back money, but I'd still probably keep writing for free.

That's because we believe in what we're doing. We're not giving away prayer cloths like Benny Hinn, and we won't heal your hemorrhoids if you put your hands on the monitor. No matter how much you contribute, we won't help you rid yourself of alien engrams and reach a state of "clear." All we can do is keep producing columns, research papers, radio shows and podcasts promoting the cause of human freedom. If that's something you also believe in, and you've got the means to help us out, please consider doing so.

If you want to sign up for a regular monthly contribution, just click here.

Kevin Carson on the utopian silliness of statism.

24 Aug 2010 | C4SS

It’s quite common for mainstream liberals to dismiss as “naïve” and “utopian” the anarchist vision—all varieties of anarchism, not just market anarchism—of a society governed by voluntary associations between free people. Without the state to prevent it, society and the economy will be dominated by the savage, combative, greedy and self-centered.

But if anything is naïve and utopian, it’s the view of the state as something that protects ordinary people against big business. If the liberals’ implicit Hobbesian view of human nature is correct, rather than my Kropotkinian view, then we’re all doomed in any case.

So it’s utopian to believe that the ruthless people in charge of businesses will be restrained from making those businesses bigger and bigger at the expense of their competitors, or the ruthless rich will be restrained from getting endlessly richer and richer at the expense of a progressively poor working class and disappearing middle class, by the simple removal of entry barriers and the presence of unfettered competition. But apparently, in the mainstream liberal view of the world, it’s not utopian at all to believe that simple procedural rules and paper restrictions can prevent the state from being controlled by the same ruthless people for their own ends.

Frankly, in terms of gritty realism, I’ll put my belief in the power of market competition to restrain business against their belief in the power of democratic majorities to control the state, any day of the week.

The state, since the beginning of history, has been the instrument of a ruling class. It first came into existence when human predators figured out the peasantry produced a sufficient surplus to be milked like cattle; since then, starting with the king, priests and nobles, moving on to feudal landlords and capitalists, one ruling class after another has been milking us.

It’s utterly naïve and utopian to believe a majority of the public can exert meaningful control over the state apparatus. A minority of insiders will always have an advantage in time, attention span, interest, information, and agenda control over those of us on the outside. The average person on the outside only has a limited amount of time or energy for maintaining an interest in politics, after dealing with the primary issues of work and family, friends, and local community. But for the elites that control the state, politics is a major part of their daily work and social life. Can anything be matched for sheer naïve optimism with the belief that, in the long run, we can maintain a higher degree of vigilance over the functioning of the state than they can?

If the state exists as a level of economic control by which a ruling class can profit, you’d better believe the most savage, combative, greedy and self-centered will always have a leg up in gaining control of it. Our only hope, in that case, is that the self-centered savages who gain control of the state will be smart enough to see it as in their self-interest to take good care of us so they can get more work out of us. That’s essentially what happened in the New Deal. The so-called “progressive” policies of the 20th century were brought about, not by democratic pressure (as in the Art Schlesinger received version of history), but in the interest of one faction of the capitalist elite.

So anything done by the state to make our lots more bearable will be done, not because the state is “all of us working together,” but as a side-effect of plutocratic and managerial elites pursuing their own self-interest. Apparently the same people who cannot be trusted in the economic sphere become fully trustworthy when they’re sitting in the “executive committee of the ruling class”.

May the liberals’ illusions rest kindly on them.

Kevin Carson is a research associate at the Center for a Stateless Society, contemporary mutualist author and individualist anarchist whose written work includes Studies in Mutualist Political Economy and Organization Theory: An Individualist Anarchist Perspective. Mr. Carson has also written for a variety of internet-based journals and blogs, including Just Things, The Art of the Possible, the P2P Foundation and his own Mutualist Blog.

Filed under: Political Science Tagged: anarchism, capitalism, class warfare, corporatism, Kevin Carson, liberalism, libertarian, market-anarchism, Newspeak, progressives, socialism