Links for your perusal

 

For those of you bored with everything in politics being labelled 'The New Hitler/Nazis/Stalin/Communists etc' you may be interested in the piece where I found the above.

Similarly, you may be interested in this if you are bored with people who use 'fascism' and 'fascist' ad nauseum.

John Harris wonders if the next General Election (which may be less than 9 weeks away...stop yawning at the back!) could be won  by a party with the support of just 20% of the electorate. Whoever gets in, argues Larry Elliott, it is not going to be much economic fun.

 

You have been warned! (Hat-tip: Weekly Worker)

Over in Canada, Larry Gambone wonders if social democracy can be revived in the West.

Various bits and pieces on media, publishing and the internet you may want to have a gander at.

How big business is getting to grips with social networking is discussed here.

How long can things stay free on the Net? He may work for Rupert Murdoch, the arch-enemy of free access, but Santham Sangara has some interesting points to make. It wasn't until reading this did I know that the typical author here makes an average of £7,000 a year from writing. This raises interesting questions about intellectual property, although as Kevin Carson argues, the current laws on IP are not designed to benefit the proverbial 'little man.' For those of you wondering about a career in writing, Robert McCrum's piece may be of interest.

Finally for now, Charlie Brooker discusses the bane of the Net: the password.

Getting me down, Part 2: Obamaism!

Emma Goldman Obama-style!

I'm still glad Obama beat McCain a year back, otherwise I think by now that there would have been a serious crisis, with threats to use nuclear weapons, and not necessarily in connection with Iran either. However, after someone decides not to throw themselves over a cliff, you have to stop congratulating them at some point.

I have no time for most of the Republican opposition to Obama. With the notable exception of Ron Paul, most of them are no-nothings who use 'socialism' as a swear word for anything they do not like politically. As Kevin Carson memorably put it, 'anyone who can seriously look at Obama’s economic team and its policies, and suspect him of being a closet "Marxist", probably shouldn’t be allowed to use scissors without adult supervision.' Serious libertarian opposition to Obama I respect a lot more, as it is opposed just as much to the warfare state as the welfare one (the former one is largely supported on a bi-partisan basis).

Possibly the best assessment of Obama from a Libertarian position comes from the pages of Reason magazine:

Obama Is No Radical: But maybe we'd be better off if he were.
Jesse Walker, September 30th, 2009

The conservative firebrand David Horowitz has declared the Obama White House a "radical regime." For the Republican radio host Sean Hannity, the ousted ex-communist "green jobs" czar Van Jones "signifies the radicalism of this administration." Even Andy Williams, the Branson crooner who sang "Moon River" and "Days of Wine and Roses," has joined the chorus, telling Radio Times this week that Barack Obama is "following Marxist theory."

For a chunk of the right—the portion that defines itself by its opposition to "the left"—that's the best explanation for the country's recent political path: Washington has been seized by radicals. But compared to a real radical, Obama is about as middle of the road as Andy Williams' music.

Yes, he gave a job to Van Jones, and if you search his administration you'll find yet more hires whose views are well to the left of most of the country. If you looked through George W. Bush's administration, you'd find hires with views well to the right of most of the country: Eric Keroack, say, the critic of contraception who landed a job atop the family planning office at the Department of Health and Human Services. It's an ideological spoils system, patronage paid to the factions that make up a party's base. And sometimes it has policy consequences, so it's worth monitoring closely.

Yet most people on the right will tell you, quite accurately, that the Bush years didn't do much to shift the country toward greater social or economic conservatism. I expect most people on the left will say something similar when Obama exits office. Thus far, the president's domestic agenda has been many things, but radical it isn't. Radicals make sudden turns. Obama sometimes slams his foot on the accelerator—just look at projected spending for the next few years—but he hardly ever tries to change direction. Radicals tear down centers of power. When Obama is faced with a crumbling institution, his first instinct is to prop it up.

That was most obviously true with the bailouts, a series of corporate preservation programs that began before he took office and have only increased since then. Candidate Obama voted for the Troubled Asset Relief Program, the 2008 bailout for failing financial institutions, and he personally intervened to urge skeptical liberals to support it. After Congress refused to authorize a bailout of the car companies, Obama followed George W. Bush in ignoring the plain language of the law and funneling funds to them anyway. Like Bush before him, Obama took advantage of such moments to adjust the institutional relationship between these nominally private businesses and the state: firing the head of General Motors, urging the company to consolidate brands, pushing for new controls on Wall Street pay. But the institutions themselves were preserved, in some cases enriched. The radical thing to do would have been to let them collapse.

And no, I'm not using "radical" as a euphemism for "free-market libertarian." A radical Obama still might have extended assistance to the people displaced by the corporate failures, perhaps even setting up a generous guaranteed income scheme. He might have broken up the big banks. He might have done all sorts of things, some wiser than others. But he would not have strengthened the corporate-state partnerships bequeathed to him by Bush.

After the bailouts we had the "stimulus" package, which boiled down to this: You're cutting back on unsustainable consumption? Here: Spend more! Around the same time we got the cash for clunkers program, which took that same impulse and added incentives that undermined the salvage business and the second-hand car trade—markets that are far more decentralized, dynamic, and open to the participation of the poor than the automakers that accepted Obama's largesse.

Now we have health care reform. Here you might actually expect the president to veer in a new direction and let a powerful institution die. After all, it's been only six years since he described himself as "a proponent of a single-payer, universal health care plan," and if he were serious about that it would mean the end of the private health insurance industry. Single payer isn't on the table right now, but liberal Democrats are trying to push a "public option"—a government-run alternative for people who'd like to opt out of the available private plans—into the legislation. And the public option is, in the words of single-payer advocate Mark Schmitt, "a kind of stealth single-payer." So in health care at least, Obama's a radical, right?

I don't think so, for two reasons. First, it's increasingly unlikely that a public option will be a part of the bill that emerges, in which case we'll be left with an enormous boondoggle for the industry: a law requiring every American to buy health insurance or else face legal sanctions. Every other powerful institution in the health sector already supports the president's proposals. Indeed, the Pharmaceutical Research and Manufacturers of America, the American Medical Association, and the Federation of American Hospitals are sponsoring a multi-million-dollar ad campaign on the measures' behalf. If the public-option-free version of ObamaCare becomes the face of reform, don't be surprised if the insurers join them.

Second, and more important, a system with more government-provided insurance, even one with only government-provided insurance, would still accept the institutional premises of the present medical system. Consider the typical American health care transaction. On one side of the exchange you'll have one of an artificially limited number of providers, many of them concentrated in those enormous, faceless institutions called hospitals. On the other side, making the purchase, is not a patient but one of those enormous, faceless institutions called insurers. The insurers, some of which are actual arms of the government and some of which merely owe their customers to the government's tax incentives and shape their coverage to fit the government's mandates, are expected to pay all or a share of even routine medical expenses. The result is higher costs, less competition, less transparency, and, in general, a system where the consumer gets about as much autonomy and respect as the stethoscope. Radical reform would restore power to the patient. Instead, the issue on the table is whether the behemoths we answer to will be purely public or public-private partnerships.

So I can't agree with Horowitz, Hannity, or Andy Williams. The president could pal around with militiamen, hook a money hose from the Treasury to ACORN HQ, and sleep each night with a Zapatista plush doll, but as long as his chief concern is preserving and protecting the country's largest corporate enterprises, the biggest beneficiaries of his reign will be at the core of the American establishment.

I'm pretty sure that if Obama had rolled back the bail-outs to Wall Street, restored the civil liberties Dubya, Darth Cheney et al had curtailed and moved to de-escalate the crisis in 'Af-Pak' it would have split a lot of the Libertarian, isolationist elements of the Republican Party away from it. 'Triangulation' is all very well as a political strategy, but you can give the other side too much respect sometimes, especially one that thinks you are a Marxist-Muslim, terrorist foreigner. Furthermore, going out of your way to disrespect the people who voted for you is a good a cue as any for electoral meltdown, as the Conservatives here found out in 97 and NuLab will discover next year.

More Mutualist Notes

The Banking Bailout's Intellectual Guru Is Revealed (Seen Here Demonstrating His Theories in Practice)!

I'm currently reading Kevin Carson's Studies in Mutualist Political Economy, which I think has the reputation of being 'The Das Kapital of Modern Evolutionary Anarchism'. I've still to finish Mr. C's magnum opus, as there is a lot to take in...and my brain has largely forgotten how to absorb serious economic theory (as opposed to slogans) in one go. In fact I've left the opening part, the most theoretical section, largely alone, and sort of made my way through the historical and 'what is to be done now?' sections.

However, after those caveats, I'm glad I'm reading it, as I think embracing Mutualism is the way forward. As the state in Britain, the US and elsewhere is getting increasingly exposed as just means to prop up Big Business financially, I think there is a space now for an anti-corporate, non-statist alternative to Actual Existing Capitalism to make its voice heard and challenge the status quo. Mutualism seems to be a good a starting point as any for trying to achieve this.

To be frank, there has not been a lot of calls from the British Left for a Mutualist approach to the current crisis. Indeed, with the British state nationalising (totally or in part) much of the banking/financial sector here, there appears to be wind (sailing, not scatalogical, metaphor intended!) behind those on the British Left whose answer to every economic or business problem appears to be a call to nationalise the sector or company in trouble. There is nearly invariably accompanied by a simultaneous call for 'workers control' of aforesaid firm or sector. Thus far in the current crisis, the British state has not heeded those calls, and without some sort of employee or consumer representation, the moves by the state to intervene in the financial system can be seen as merely state capitalism, as the Independent Working Class Association has pointed out.




Intellectual Guru demonstrates 'Plan B'...

Furthermore, I think the Left (here and elsewhere) has to think beyond putting forward nationalisation as the answer to all problems. There are some sectors ie the utilities, the railways, the Post Office, the NHS where I cannot see how corporations can do a better job than the state. That is, Actual Existing Corporations, as opposed to those pie-in-the-sky enterprises Politicians, Think Tanks and Journalists seem to think run erstwhile public services. However, even in the public sector, there needs to be more than just state ownership, run (often at arm's length) from Whitehall. Tony Benn wrote back in 1980 that 'We have had enough experience now to know that nationalisation plus Lord Robens does not add up to socialism' (Arguments for Socialism, quoted in Geoffrey Foote [1986, Croom Helm]The Labour Party's Political Thought, p.330). Hence it should be pretty obvious that a state-owned bank headed by some failed ex-financier who sends Christmas cards to Gordon Brown and Tony Blair is NOT socialism either. There needs to be some sort of representation of employees and consumers in the running of public enterprises. This is not just 'a good thing' for socialists to support. It is essential that state-owned enterprises have some democratic input from those who work in them, and use their products, otherwise further down the line the claim that 'we are returning to the 1970s' or 'modelling the economy on the old Eastern Bloc model' will come to the fore and derail any moves towards a post-corporate society. Writing in the early 1980s (In the Tracks of Historical Materialism, Verso Press, 1983, p.49), Perry Anderson wrote about the need for a quite detailed exposition of what a socialist society would look like, as:

'...it is quite clear that without serious exploration and mapping of it, any political advance beyond a parliamentary capitalism will continue to be blocked. No working-class or popular bloc in a Westernsociety will ever make a leap in the dark, at this point in history, let alone into the grey on grey of an Eastern society of the type that exists today. A socialism that remains incognito will never be embraced by it.'

Over a quarter of a century on, the need for a non-statist vision of a socialist society is even more pressing, and I think Mutualism can play a large part in creating such a vision.

While contemplating writing this post, I came across the following article. At the very least, it shows that Mutualism does occur in real life, and does suggest that it is a way for the Left to move forward:

Citizenship in action
Swiss firefighters are a living rebuke to right and left: society does exist, but is best left alone
Geoffrey Wheatcroft, The Guardian, Thursday 22 January 2009

A week before Christmas my son and I were skiing in the Swiss resort of Mürren and staying at the Eiger Guest House run by Alan and Véronique Ramsay-Flück, a Scottish-Swiss couple. At breakfast one day Alan was nowhere to be seen. It transpired that he's now a Swiss citizen and a member of the village fire brigade, who had been called out at 4am to deal with a fire raging in a barn a few miles away. A dramatic picture in the next day's local paper showed the barn had burned out but that they saved the farmhouse next to it.

We were suitably impressed, but there was more to it. What had happened that night was something increasingly rare in my own country: citizenship in action, not to say co-operative mutual aid. The fire brigade in Mürren - as in other towns and villages, in some parts of the US, and in social-democratic Denmark - isn't professional but amateur, in the best sense of the word. The firefighters are part-timers, carrying pagers for call-outs. Their only reward is serving their community.

Our nearest equivalent is the wonderful Royal National Lifeboat Institution, which may not think of itself as making a political statement but does. The lifeboat crews are unpaid volunteers. And the whole organisation receives no state support but is entirely funded by public donations. If the behemoth of the modern state is one pattern for society, the RNLI is another.

And so is much of Swiss society. One of the more pleasing things, if one comes from our damp little island and is condemned to talk with an accent that defines caste, is that everyone in Mürren sounds the same. Educated people read books and papers in literary German, but doctor, plumber, postman and teacher all speak the same Schywyzerdütsch, the impenetrable local Swiss-German dialect.

Over the centuries, people with several different languages and religions found a way to live together peaceably in Switzerland. The army consists of every adult man, with his uniform in a cupboard at home; that citizen force was formidable enough to make Hitler think twice about invading. And by way of a decentralised confederal structure, democracy works in a most practical way, with decisions taken at local level.

To praise Swiss localism, or voluntary institutions, is to risk being called rightwing, but that's curious when you look at it. Every kind of "little platoon" is in truth a rebuke to both left and right. Since the 19th century, critics of the ever-growing state called themselves liberal individualists, a misnomer which ignored the obvious truth that most forms of creative human activity are collective. A Cornish lifeboat crew and an Oberland fire brigade refute dogmatic individualism and "vulgar-Thatcherism": there is such a thing as society. The real distinction isn't between individual and collective, but between the voluntary and the coercive.

And yet for that reason those amateur platoons are a rebuke also to the left - or at least to state socialism. In either its Leninist or Fabian forms, socialism assumed unconsciously that people could not or would not deal with their lives by their own initiative and through co-operation unenforced and unregulated by the state. Even the moderate socialism of our own Labour party was all too clearly based on the belief that the lower classes were too backward, feckless and idle to look after themselves and had to be taken care of, whether they liked it or not.

In that respect, the modern welfare state took over from older repressive institutions, and in the process helped eviscerate the finest thing Britain has produced: the voluntary institutions of the self-helping working class. That splendid anarchist writer Colin Ward once made the point by contrasting the very names of the two kinds of organisation in 19th-century England: "On the one side the Workhouse, the Poor Law Infirmary, the National Society for the Education of the Poor in Accordance with the Principles of the Established Church; and on on the other, the Friendly Society, the Sick Club, the Co-operative Society, the Trade Union. One represents the tradition of fraternal and autonomous associations springing up from below, the other that of authoritarian institutions directed from above."

If anything, the RNLI and the Mürren fire brigade are exemplars not of greedy capitalism or some crazed Ayn Rand war-of-all-with-all, but of anarchism, and Kropotkin's "Mutual Aid". And if a "left" has anything to teach in the coming century, it won't be the authoritarian tradition which sees the the state as the answer to all problems, but the spirit of free mutual co-operation that believes that people can help each other - and will actually do so if left alone.

I can imagine someone asking what the Swiss fire brigade has to do with life in Blighty in order to put down the idea of Mutualism taking flight here. Well, there are political traditions here which, at the very least, overlap with Mutualism. I have mentioned before Meredith Veldman's Fantasy, the Bomb and the Greening of Britain: Romantic protest, 1945-1980 (1984, Cambridge University Press) and did promise to come back to it. In this case it is to refer to Veldman's volume to show that there are English political traditions which lend themeselves to being, at least, intellectual fellow travellers of Mutualism.



G.D.H. Cole: Mr. Guild Socialism

There is, for instance, Guild Socialism, which was taken up by leading socialist thinker G.D.H. Cole. He became a supporter of Guild Socialism as it 'offered me a kind of socialism that I could want as well as think right', since it saw people 'as having personalities to be expressed as well as stomachs to be filled.' (p.25)Cole saw Guild Socialism as attempting to realise 'a union of industrial self-government and community control' (p.26). He also believed that 'democracy had to be small, or broken up into small groups, in order to be real' (p.28). Cole and Guild Socialism is also discussed in the Foote book on the Labour Party's political thought. This shows that although Cole believes the nation-state to be supreme in national matters, such as foreign policy and defence, it had no right to interfere in those areas not common to its citizens, such as religion and industry. Cole says 'the State itself should only be regarded as an association- elder brother, if you will, but certainly in so sense father of the rest.' (Foote, op cit, p.115.)



G.K. Chesterton: Mr Distributism

Returning to Meredith Veldman's tome, it is possible to identity 'distributism', as advocated by GK Chesterton, as another intellectual fellow traveller of Mutualism. A caveat must be made here. When I was younger there was two things I associated Chesterton with: (i) 'The Father Brown' detective stories and (ii) a reputation for anti-semitism. From what I've read, I think Chesterton was pretty anti-semitic in outlook for most of his life. However, when the Nazis took charge in Germany, this changed, as his Wikipedia entry suggests:

In 1934, after the Nazi Party took power in Germany he wrote that:

'In our early days Hilaire Belloc and myself were accused of being uncompromising Anti-Semites. Today, although I still think there is a Jewish problem, I am appalled by the Hitlerite atrocities. They have absolutely no reason or logic behind them. It is quite obviously the expedient of a man who has been driven to seeking a scapegoat, and has found with relief the most famous scapegoat in European history, the Jewish people.'

The Wiener Library (London's archive on anti-semitism and Holocaust history) has defended Chesterton against the charge of anti-Semitism: "he was not an enemy, and when the real testing time came along he showed what side he was on."

Chesterton condemned the Nuremberg Laws, and he died in 1936, as the Hitlerite antisemitic measures were temporarily decreased due to the Berlin Olympics, long before lethal persecution by the Nazis would start.

Sometimes one needs to see the possible consequences of a particular attitude before one rejects that attitude.

Like Cole, Chesterton was a firm believer in political and economic democracy, or distributism, as Chesterton saw it. As Veldman says, Chesterton thought men should be trusted to make their own decisions that concerned their lives and societies, rejecting the idea of there being a 'stupid public'. He thought real democracy depended upon participation, which could only be really secured in a decentralised, locally controlled system in which each citizen could see that their opinions and actions mattered. (Veldman, op cit, pp.33-34) Chesterton believed that 'The best and shortest way of saying it is that instead of the machine being a giant to which the man is a pygmy, we must at least reverse the proportions until man is a giant to whom the machine is a toy.' In economic sectors where large-scale tehcnology was essential, Chesterton advocated worker shareholding so that machinery belonged to each worker (ibid, p.35).

I realise this post is rapidly advancing into Outer Space, so I'm going move into the home straight. It was from the start more a way of putting various bits and pieces into the blogosphere that any Grand Synthesis...'Studies in Mutualist Political Economy' it is not! I will try and finish Kevin C's magnum opus before the whole economic edifice collapses and I have to finish it by candlelight in a London tube tunnel, and return to Mutualism once again!

Another Kevin Carson book review

In fact two reviews, of books by Sean Gabb and Chris Dillow. Both are scorching critiques, from heterodox "Right" and "Left" positions, of New Labour.

Two Book Reviews: New Labour and Managerialism in British Politics, Monday, November 05, 2007

Sean Gabb. Cultural Revolution, Culture War: How Conservatives Lost England, and How to Get It Back (London: The Hampden Press, 2007). 105 pp.

Chris Dillow. The End of Politics: New Labour and the folly of managerialism (Hampshire, UK: Harriman House, 2007).

These two books, seemingly from divergent ideological perspectives, are both critiques of managerialism in British politics--and perhaps not so divergent after all.

Sean Gabb, successor to the late Chris Tame as Director of the Libertarian Alliance, is very much a man of the Right: a composite of Burkean and Little Englander, roughly equivalent to the Old Right or paleolibertarians on this side of the Atlantic. In his critique of managerialism and the corporate state, however, he has much to say about globalization and corporate rule, among many other things, that left-libertarians will find of benefit.

Chris Dillow, a heterodox economist who owns Stumbling and Mumbling blog, attacks managerialism from a position decidedly on the Left. But it's a Left that's friendly to markets, decentralism, and self-management, and hostile to the New Class version of bureaucratic socialism that dominated Britain from the Webbs to Harold Wilson.


* * *


1. The chief villain in Gabb's book is the managerial New Class and the rentier capitalists whose main source of profit is their association with the corporate state:

It is clear that our ruling class--or that loose coalition of politicians, bureaucrats, lawyers, educators, and media and business people who derive wealth and power and status from an enlarged and active state--wants an end of liberal democracy. [p. 6]

Elected politicians never have the running of a country all to themselves. While undoubtedly important, they must in all cases govern with the advice and consent of a wider community of the powerful. There are the civil servants. There are the public sector educators. There are the semi-autonomous agencies funded by the tax payers. There are journalists and other communicators. There are certain formally private media and entertainment and legal and professional and business interests that also obtain power, status and income from the policies of government. Together, these form a web of individuals and institutions that is sometimes called the Establishment, though I prefer... to call it the ruling class. [p. 8]

Gabb's ruling class, like the mass base of Orwell's Ingsoc party, was "brought together by the barren world of monopoly industry and centralized government."

The new Britain he finds so objectionable was essentially described by Anthony Burgess some forty years before. Indeed I find the absence of any reference to Burgess somewhat remarkable. Tony Blair's Britain, with its near-total supercession of common law protections by administrative courts, and with the social pathologies symbolized by the ubiquity of yobs, happy-slappers and ASBOs (Anti-Social Behaviour Orders), under the watchful eye of the public surveillance camera, could have leapt from the pages of A Clockwork Orange or 1985. Burgess's Britain, terrorized by hoodlums like Alex and his droogs, in which "everyone not a child or with child must work," and where the Minister of the Interior sought to empty the prisons of common prisons because they'd "soon be needing them for the politicals"--is it really such a stretch of the imagination, these days?

The instruments by which the New Class is imposing this "new settlement" on Britain are the replacement of common law due process, civil liberties, and parliamentary government by the unaccountable rule of administrative bodies, and the use of multiculturalism as an ideology to divide, conquer, and reshape society.

Gabb sees the old institutional basis of liberal democracy being eviscerated by the New Class:

...structures of accountability that emerged in the 17th and 18th centuries are to be deactivated. Their forms will continue. There will be assemblies at Westminster. But these will not be sovereign assemblies with the formal authority of life and death over us all. That authority will have been passed to various unelected and transnational agencies. And so far as the Westminster assemblies will remain important, our votes will have little effect on what they enact. [p. 6]

I can find much to disagree with in Gabb's view of cultural (or rather multicultural) matters. For example, in principle I would view the shift in orientation of the National Maritime Museum in Greenwich that he describes, from a celebration of Empire and naval supremacy to a focus on slavery and "history from the position of the colonised," [p. 10] as a good thing. I consider insititutional racism in police forces, and the casual expression within police circles of racist attitudes toward the subject populations over which they are have been given near-unlimited power to coerce, in a much more alarming light than Gabb apparently does. In a country where the names Cory Maye and Katherine Johnson have recently figured in the news, where every week brings another story of someone murdered in a botched no-knock raid, or of someone being tasered to death for "resisting arrest" (who turned out to have been in a diabetic coma)--I can understand the reasons for rooting out such attitudes among our "protectors and servers" root and branch. I confess little sympathy for a uniformed beast of prey (or "filth," in the apt terminology of some across the Pond) who expressed approval for the murder of black suspects in police custody, and who joked about burying a "Paki bastard" under a railway line,-- regardless of how badly his life was "ruined" by exposure. [pp. 11-12] Although Gabb suggests the public reaction was "excessive" and expressed some doubt as to whether such views would affect their performance of public duties, [p. 12] given the background of police abuses in my own country I tend to think cops with absolute and unaccountable power are quite prone to act on such views, and that the public reaction isn't severe enough.

But the remarkable fact is not our disagreement on cultural matters, but that I concur with so much of his analysis of the effect of "political correctness" and multiculturalism as ruling class ideologies. Like Gabb, I see official multiculturalism in the hands of the New Class and its state agencies as an instrument of division and control, serving a ruling class that prefers a population without the cohesion to resist.

The ruling class seeks "the establishment of absolute and unaccountable power," to be achieved in part by coercion, but even more by the "reshaping of our thoughts." The significance of multiculturalism is not so much its objective content, or the often harmful and wrongheaded content of the older habits of thought it seeks to replace. It is the attitude of uncertainty and deference it seeks to create among the ruled: constant uncertainty and anxiety lest they be using a word ("crippled" or "handicapped" rather than "differently-abled," "black" rather than "African-American," "Indian" rather than "Native American") that has been superceded by the Eleventh Edition of the Newspeak Dictionary, and deference to the class of social engineers who decide the currently acceptable terminology. And the terminology is deliberately changed frequently enough to maintain this constant free-floating sense of anxiety and dependence.

As dangerous as virulently racist views may be when held by the lawless thugs whose "gang colors" are police uniforms, the nature of the ideas being stamped out is purely incidental for the social engineers; their real purpose could be served just as well by identifying any widely held belief, no matter its substantive content, as a "thoughtcrime" to be policed by themselves. And the assumption of such state power is even more dangerous when exercised against private citizens--as when plainclothes police agents visited Chinese and Indian restaurants to monitor the patrons for ethnic slurs against the staff. [p. 13] Criminalizing the expression of racist views by private citizens, no matter how abhorrent--it should go without saying for any libertarian--endangers the liberties of everyone else.

The ruling class's motivation in ideologically renovating museums and such is not to replace a worse with a better understanding of an objective truth, but to "weaken their ties with the past, or... to make them into vehicles for contemporary propaganda." [p. 10]

Every autonomous institution, every set of historical associations, every pattern of loyalty that cannot be co-opted and controlled--these must be destroyed or neuralized. [p. 25]

Their agenda, in rooting out and punishing private expressions of racist thought, is to seize on the abhorrence that many understandably feel for such views as a vehicle for putting power into the hands of a class of social engineers.

If borders and customs and other artificial barriers to the free movement of people are a bad thing, then so is the artificial mobility promoted by Empire and by subsidized global capitalism. The result, as described by Gabb, is to render impossible a recurrence of the liberal uprisings of the sixteenth and seventeenth centuries , "by promoting movements of peolles so that nations in the old sense disappear, and are replaced by patchworks of nationalities more suspicious of each other than of any ruling class." [p. 6]

Stripped of the Left's older preoccupations with economics and class, likewise, multiculturalism can be of immense service to the cartelized private sector in policing its wage-serfs and cubicle-drones. For one thing, the added inefficiency and overhead costs of an internal PC regime, as Gabb observes, are cartelized: that is, they apply equally to all large corporations and are therefore not a matter for competition between firms. [p. 48] For another, the postmodern, multicultural corporate culture described by Thomas Frank in One Market Under God is much closer to the worldview of David Brooks' "Bobos" who predominate in managerial ranks. In the U.S., for the managerialists and professionals who constitute the base of the Democratic Party, stagnant wages, downsizing, and all the other economic aspects of the new global economy are perfectly fine--so long as the people in the boardrooms who do the exploiting "look like America." Forty years ago in The Greening of America, Charles Reich depicted a hippie chic utopia in which the centralized, hierarchical power structures of the state and corporation were largely unaltered--but staffed by people with bell-bottoms and beads. What mattered was not the existence of concentrations of power, but that the people in power "had their heads in the right place, man." That "utopia" is, in essence, now a reality. Most importantly, in an age of increasing worker disgruntlement over stagnant pay and increased workloads, an internal PC regime serves admirably to promote resentment and divisions and reduce solidarity among workers, and provide trumped-up grounds for disciplining troublemakers.

A central part of Gabb's analytical toolkit is the work of Frankfurt School and neo-Marxist scholars on "ideological hegemony." Although he denies the applicability of their analysis to "liberal democracy," he sees it as well-suited to the ideological project of the new ruling class.

I should say, in passing, that I take issue with Gabb on the relevance of neo-Marxist thought to the old, "liberal" order. He denied the existence of any real "hegemonic discourse" under the old liberal regime, arguing rather that political leaders tended to legitimize their positions in terms of a value system which arose spontaneously from civil society and which they accepted as given. [p. 20] Likewise, he considers the Chomsky/Herman "propaganda model" of the media to have been inapplicable to liberal democracy. [pp. 31-32]

I think he is mistaken on this count. For one thing, the question of whether "liberal democracy" even existed in any meaningful sense is a very real one. The old liberal democracy was dominated by privileged capitalist and landed elites whose economic position resulted, not from the workings of a market, but from the state. And the old "spontaneous" ideological climate reflected, to a large extent, their interests. For another, the New Class and its ideology are nearly as old as corporate capitalism, and its managerialist world-view (eg. scientific management) has been incorporated into the service of the plutocracy since the corporate revolution first required a class of "professional" overseers. The New Class and managerialism, and the protective and nurturing state, have been integral parts of corporate capitalism since its beginning; and if we identify the full flowering of liberal democracy with the electoral reforms of 1833 and 1867 (let alone 1911), then liberal democracy was hardly even fairly begun and the Old Regime fairly ended, before the beginnings of state capitalism. Genuine "liberal democracy" was largely limited to a thin sliver of thought by Ricardian radicals like Hodgskin, assorted Cobdenites, etc., sandwiched in-between the Old Regime and state capitalism, which was quickly relegated to a few radical free market strands (the individualist anarchists, Georgists, Nock and Borsodi, etc.) fighting a rear-guard action within state capitalism.

And in more general terms, hegemonic ideology is coextensive with, and as old as, class society. As an individualist anarchist, I consider class power and economic exploitation the primary functions of the state; and just as there has never been a genuine free market, free from economic exploitation by state-privileged classes, there has never been a society without a hegemonic ideology serving such privileged classes. Hegemonic ideology, I should add, does not require any conscious, conspiratorial design--it is a largely automatic result of a society's normal tendency to reproduce the conditions for its own continued existence.

I also suspect Gabb's treatment of neo-Marxism as the ideology of the new ruling class is overblown. There may be something to his tracing of their political style to the New Left fashions of their formative years; Gabb cites Boyd Tonkin to the effect that while Nulab has abandoned most of the economic content of Marxism and social democracy, their "pattern-building, system-seeking cast of thought" persists. [p. 22] But stripped of their economic and political substance, the signficance of their style itself is tenuous at best (as also with explanations of the neoconservative "style" in terms of their alleged Trotskyite origins).

As an analytical tool for describing the ideological functions of the ruling class, as opposed to the content of their ideology, neo-Marxist concepts may however be quite useful.

And while I disagree with Gabb on the question of whether a hegemonic ideology existed under "liberalism" and the Old Regime, I do agree that it was much more feasible to argue against the hegemonic ideology from an independent base. The average person of the late twentieth century was far more conditioned by his televised matrix reality, than the average member of the working class by the hegemonic ideology of the nineteenth century. The very extent to which Marxism and assorted brands of anarchism spread among the working classes demonstrates as much. Contrast, for example, Thomas Franks' Kansas before WWI, to the same region in recent years. It was surely even more prone to Bible-thumping and Jesus-shouting at the turn of the twentieth century as it is now--and yet it was one of the prime constituencies for the Wobblies and Gene Debs, and home to a vibrant and independent working class press. Today, on the other hand, the populist resentment of the area is channeled by Rove's talking points and AM talk radio against a range of targets carefully selected by the ruling class. The turning point was probably the liquidation of the genuine socialist, working class, and economic populist movements during the reign of terror under St. Woodrow and A. Mitchell Palmer. We may finally be witnessing today, with the rise of the Internet and network culture as an alternative to the gatekeepers of the corporate media, the weak beginnings of a resurgence of something like the pre-WWI independent popular culture.

Gabb's revolutionary agenda deserves a great deal of attention. He rejects any gradualist program of scaling back one institution at a time. Such a strategy, he says, would just result in a pitched battle over each institution, with the anti-state coalition quickly losing its political capital to a war of attrition. The only hope is to gamble everything on electoral success and then to act quickly and decisively, in the brief window of opportunity, to dismantle as much of the ruling class' institutional base as possible, so that it cannot be quickly reconstituted if power once again changes hands. That means completely abolishing institutions like the BBC, and completely dismantling the administrative apparatus and records of the regulatory state ("An hour in front of a shredding machine can ruin the work of 20 years."), and--while leaving the state schools intact--completely abolishing teacher training colleges. [pp. 54-56, 60]

I am skeptical as to the prospects for any such all-at-once seizure of power, as opposed to gradually rolling back the state and supplanting it with alternative organizations (as per both the agorist agenda of building a counter-economy, and the Wobbly strategy of "building the structure of the new society within the shell of the old"). But I agree that, revolutionary or gradualist, the goal of any libertarian movement should be, not to control the state and other centralized institutions, but to dismantle them. I am very much a believer in Michels' Iron Law of Oligarchy. Genuine democratic control of centralized, hierarchical institutions is impossible. Our only hope for real democracy is to destroy as much of the infrastructure of the centralized state and corporate economy as possible, and replace them with loose political federations of local direct democracies and with a free market of competing worker cooperatives.

Along these last lines, interestingly, Gabb proposes something of an entente with the libertarian left.

...there are many anarchists and syndicalists and libertarian socialists who do not believe in this extended state. And so I will make it clear that when I talk about a free market, I do not mean a legal framework within which giant corporations are able to squeeze their suppliers, shut down their small competitors and socialize their workers into human sheep.

I have already said I would not defend the landed interests. I would very strongly favor an attack on the structures of corporate capitalism

Organisations like Tesco, British Pretroleum and ICI are not free market entities. They are joint stock limited liability cororations. The Company Acts allow them to incorporate so that their directors and shareholders can evade their natural responsibilities in contract and tort. They are, for this reason, privileged in law....

It is not true that big business has in any sense suffered from the public interventions in economic activity of the past hundred years. The truth is that big business has benefited from, and in many cases, promoted every agenda of big government. Employment protection laws, product safety laws, curbs on advertising and promotion, heavy taxes, and all the rest--these have served to insulate big business from their smaller competition, or have cartelized or externalized costs, thereby reducing the need for competition between big business....

The leaders of large corporations are nothing more than the economic wing of the ruling class. They provide taxes and outright bribes that enrich the political wing. They act as part of the ideological state apparatus.... In return for all this, they receive various kinds of protection and subsidy that allow them to make large profits.

They police their workers... Workers find themselves gently conscripted into large organisations that strip them of autonomy and suppress any actual desire for self-direction. Anyone who works for any length of time in one of these big corporations tends to become just another "human resource"--all his important life decisions made for him by others, and insensibly encouraged into political and cultural passivity. [pp. 63-65]

His description of the likely fate of the state-affiliated "private sector" corporate economy, after the revolution, is positively eloquent:

Our first big attack on the present ruling class should destroy most of the really dangerous government bodies, and the formally private bodies that now cluster round them would perish like tapeworms in a dead rat. [p. 61]

The tapeworm is to be killed through the elimination of all subsidies and protections, and above all the elimination of limited liability.

We should promote the emergence of markets in which the majority of players are sole traders and partnerships and worker cooperatives, and in which the number of people employed on contracts of permanent service is an ever-dwindling minority.... [This policy] would replace armies of ruling class serfs with beneficiaries of our counter-revolution. [pp. 65-66]

The welfare state he advises to leave pretty much alone for the near term. In so doing, the revolution would deprive the ruling class of its chief potential ally for an attempted counter-revolution. And, he points out, the main actual cost of the welfare state is the administrative overhead from supporting intrusive and authoritarian welfare bureaucrats in a comfortable lifestyle. As a first reform, he proposes eliminating the entire apparatus of case workers and redirecting the entire welfare budget to a guaranteed annual income. [pp. 57-59] Ultimately, it could be drastically scaled back as increased working class prosperity and a resurgence of voluntary mutual aid arrangements made it unnecessary. [p. 63]

His tax agenda--eliminating the income tax and VAT, and replacing them with a tax on land-value--should be pleasing to the Geolibertarian contingent of the libertarian left. [pp. 62-63]

In the legal realm, Gabb proposes dismantling as much as possible of the administrative state and its prerogative law procedures. In the restored common law, all regulations of vice and private behavior are to be eliminated, while making penalties for real crimes against person and property sufficient to deter. For the latter crimes, however, a maximalist reading of all common law due process guarantees is to be restored:


the right to silence under police questioning, the full right of habeas corpus, the full presumption of innocence, the full right of peremptory challenge of jurors, the rules against similar fact and hearsay evidence, the unanimity rule in jury trials, and all else that has been taken away. [p. 68]


* * *


2. The central focus of Dillow's critique of New Labour is managerialism. By that, he says,

...I mean an ideology which tries to eliminate political debate about the rival merits of competing ideals. In its stead, managerialism relies on a central elite which believes that it, and it alone, has the skill and know-how to devise policies to cope with the inexorable forces of economic change.... In short, New Labour believes it can run a country in the same way that executives run a business. [pp. 11-12]

...Managerialists like to pretend that we face big challenges in a fast-moving environment. They invite us to believe that they alone are equipped to address such challenges (in managerialism, problems are never solved, only addressed). And they like to present policies as necessary responses to external events--just as company bosses present mass redundancies as inevitable measures over which they have little choice. [p. 14]

The irony is that New Labour managerialists, for all their proclaimed technocratic competency, are so ham-handed in their "solutions" to the pressing needs of the changing economy. "Information technologies are transforming our lives," goes the Nulab slogan. "Fair enough," replies Dillow. But he points out that the organizational paradigm of the new economy is the substitution of networks for hierarchy, while the Blairite "solution" is even more hierarchy. [p. 16] An interesting point of comparison is Bill Gates, the fountain of so much superficially libertarian rhetoric about new economies and flattening hierarchies, but whose practical agenda focuses almost entirely on the use of state power to protect corporate hierarchies from the destabilizing effects of the new economy: the Digital Millennium Copyright Act, Vista Genuine Advantage, the recurring threat of infringement action against Linux distributers. Blair and Gates, faced with a technological and economic revolution against hierarchical institutions, attempt to domesticate the revolution and render it amenable to the control of hierarchical institutions.

This is especially disappointing, given Blair's Christian socialist roots and his early affinity for quasi-distributist ideas. The Cooperative Party, in an almost touching exercise in denial, have long persisted in celebrating their ties to Blair and Brown; until recently Blair's visage leered down from the banner of their website.

But despite occasional lip service to "a redistribution of power that offers people real control over the decisions that affect our lives" (Gordon Brown), New Labourites never consider any cooperative challenge to corporate hierarchy.

New Labour likes to claim that it is "pro-business." The significance of this is that one rarely hears that it is "pro-market."

The distinction is important. Markets are tumultuous, unpredictable and uncontrollable processes, which often make fools of the most esteemed expert.... Businesses, however, are hierarchical bureaucracies and their leaders are often more like senior civil servants than buccaneering entrepreneurs.

New Labour's preference for business over markets shows its managerialist bias--because to any managerialist, businesses, with their mission statements and their illusions of control, are much more congenial than the disruptive anarchic forces of the market. [p. 19]

Dillow, in denouncing New Labour managerialism, does not fall into the common pattern of considering its economic agenda a neoliberal departure from the older Fabian socialism.

We might observe, in passing, that almost from their first Fabian and Crolyite beginnings, New Class advocates of a mixed economy in the Anglophone world have been in fact the hired help of the corporate plutocracy.

And as Dillow points out, Blair's agenda was very much in line with the anti-labor authoritarianism of the old Fabian movement. Blair's "work not welfare" was a logical outgrowth of the Beveridge Report's aim "to make and keep men fit for service." [p. 9] C.S. Lewis' depiction of authoritarian social engineering in That Hideous Strength was a fairly plausible extrapolation from the most proto-fascistic tendencies of H.G. Wells and the Webbs (with their forced labor camps and sterilization for the underclass), and from the New Statesman agenda of the late 1940s.

There is one issue on which I probably disagree with Dillow: the necessary tradeoff between efficiency and equality. Dillow takes issue with the New Labour theme that we can have both efficiency and equality. Although that position may well be spurious as it is meant by New Labour, I think it is in fact quite possible to have dramatic gains in both equality and efficiency compared to the present baseline, with no tradeoffs of any kind. The reason is that most of the present inequality in income bears no relation to differences in efficiency, but rather results from privilege and exploitation. If by "equality" one means eliminating incomes that derive from privilege, and by "efficiency" tying income to productivity, the two are necessarily connected.

I suspect the problem with New Labour's idea of reconciling the two lies with their conception of "efficiency": a Schumpeterian/Chandlerian/Galbraithian monstrosity of centralization, false economies of scale, and Weberian rationality. Accordingly, their recipe for "efficiency" assumes the existing corporate institutional structure will be left intact with all its assorted forms of privilege, and then "equality" is achieved by redistributive taxation and welfare to distribute some of the surplus accruing from such "efficiency." The New Labour approach is to leave the hierarchical corporate and state apparatus untouched, and then promote both "equality" and "efficiency" through top-down social engineering: carefully tailoring taxes, benefits, minimum wages, and other incentives to maximize output and achieve the ideal distribution of income.

....governments know how labour supply decisions respond to tax and benefit rates, so they can design a tax and benefit system that encourages people to work. They know how to set the minimum wage at a high enough level to raise incomes, but not so high as to destroy employers' willingness to employ peole. They know enough about what determines companies' capital spending decisions, so they can promote investment by striving for macroeconomic stability. And they know how to improve education, and how education affects earnings, so they can use better schooling to reduce wage inequality and promote economic growth by providing a bigger supply of skilled workers. [p. 21]

But in fact the present corporate system is pretty bad from the standpoint of efficiency. It starts from the assumption of enormous concentrations of wealth in a few hands, the absentee ownership of capital by large-scale investors, and a hired labor force with no property in the means of production it works. Necessarily, therefore, the absentee owners must resort to the expedient of hierarchy and top-down authority to elicit effort from a work force with no rational interest in maximizing its own productivity. Such hierarchies necessarily result in the divorce of effort from reward, and of productive knowledge from authority. Each rung of authority interferes in the efforts of those who know more about what they're doing, receives only information filtered from below based on what they want to hear, and is accountable only to those higher up the chain of command who are even more unaccountable and out of touch with reality.

The obvious solution, the worker cooperative, by uniting knowledge with authority and reward with effort, would slice through the overwhelming majority of the hierarchical corporation's knowledge and agency problems like a Gordian knot. The problem of socially engineering the wages and benefits system so as to "encourage people to work" would disappear; the elimination of privilege and unearned income, and the receipt by labor of its full product, would tie reward directly to effort.

But this solution is ruled out by the system's structural starting assumptions of concentrated wealth and absentee ownership. So the hierarchical corporation is adopted as a sort of Rube Goldberg expedient, the most rational means available given fundamentally irrational ends.

I say above that I probably disagree because Dillow's own agenda, presented at the end of the book, consists of the very sort of program of economic democracy that would be perfectly designed for the coincidence of efficiency and equality. He is an enthusisatic supporter, for example, of worker cooperatives and self-management. He is also very big on the idea of the government introducing cooperative, decentralist and democratic principles into its own enterprises:

The salient fact about New labour is that it has done nothing whatever to equalize status within the organizations it runs. The civil service is as inegalitarian--lethally so--as it was in 1997. And there's been no effort to convert schools and hospitals into more egalitarianly managed structures. The state is far more hierarchical--far more opposed to the concept of equal status--than any investment bank. [p. 215]

Indeed, one of the planks in his agenda is titled "Turn schools and hospitals into cooperatives."

His case against hierarchy and for self-management is bolstered by extended arguments toward the end of the book. In Chapter 13, "The Rituals of Reason," he examines at length the fallacies and biases to which management is prone, in overestimating its own competence and underestimating the intractability of problems.

One might raise the question of whether managers are really unique in this respect; are not workers, also, prone to such conceptual biases? The answer, I think, is that (of course) everyone is prone to logical fallacies and conceptual biases. But their tendency to distort thought increases the more a decision-maker is separated from direct knowledge of a problem, and the more concrete practical knowledge is replaced by abstract considerations. The closer a decision-maker is to the subject of his decision, and the more it involves matters of familiar technique or personal experience, the more competent his decisions. A skilled laborer on the shop floor is apt to be the best judge of organizing production, or of handling the organizational problems involved in coordinating the activity of skilled workers like himself in his own work unit. If his work unit is a small factory producing for a local market, made up of people largely known to the work force, and with retail outlets that have maintained relations with the factory for an extended period of time, he and his coworkers are apt to be the best judges of the levels output required by the market and the product innovations likely to be demanded.

Dillow's critique of hierarchy, as a source of irrationality and knowledge distortion, is very Hayekian.

When the first factories were established by Richard Arkwright and James Watt, it made sense for them to control production with an iron hand, because they knew the production processes inside out--they had invented them...

Today management doesn't have this know-how. Products, process and markets are too complex for anyone to know as thoroughly as Arkwright or Watt did....

Instead, knowledge of the production process is scattered across the organisation. If you have a problem, it is often better solved by asking your fellow workers than asking the boss.

However, hierarchies can obstruct co-operation between workers. One reason for this is simply that pyramidal reporting lines often prevent workers from knowing and therefore using the skill of their colleagues. Another reason is that communication requires trust.... Worse still, the benefits of co-operation are often impossible to quantify, and so a management obsessed with budgets and targets does not encourage it. And the knowledge that such gains will flow to managers, rather than themselves, will inhibit workers from co-operating fully. [p. 278]

The hierarchical, authoritarian corporation is especially ill-suited to knowledge work, and other forms of production in which human capital is the most important factor.

It might make sense to give the order "be here by nine o'clock." But it's just gibberish to say, "be creative."

In an authoritarian environment, workers prefer (in the words of Kenneth Cloke and Joan Goldsmith) to "suppress their innate capacity to solve problems and wait instead for commands from above." [p. 279]

Dillow observes that excessively large government works contrary to the goal of income equality. The reason is that, when state expenditures eat up a large enough portion of the GDP, it becomes impossible to fund them by taxing the rich alone. A society in which the state consumes 50% or more of GDP will, of necessity, have a high tax burden on the middle class. [p. 69]

He is quite hostile to New Labour's social engineering approach to taxation. Rather than a complex, administration-intensive program of carefully targeted tax credits and cuts, it would make far more sense to institute a citizen's basic income which requires little administrative bureaucracy. [p. 85] In the American context, I have long cursed the lack of an alternative to the mainstream Democratic and Republican approaches to tax cuts. The Republicans, predictably, are wedded to the idea of "across the board" tax cuts that go overwhelmingly to the plutocracy. Democrats, as one might expect of such nanny statish social engineers, prefer carefully targeted tax credits for child rearing, health insurance, higher education, home energy efficiency, etc. The obvious alternative to both, as progressive as it would be libertarian, would be to simply raise the standard exemption to $30,000 or so.

The great size of political units, and the removal of the administration of welfare as a question for local self-government, has nullified the natural tendency toward mutual aid shown by humans in communities small enough for direct personal acquaintance with the disabled or unemployed. As a result, the working class tends to resent the underclass and to be vulnerable to anti-welfare demagogy by right-wing politicians. [p. 219] A decentralized society of small, self-governing population units might well contribute voluntarily to mutual aid arrangements on a scale sufficient to render taxation unnecessary (especially if laborers received a larger portion of their actual product).

In the process of writing his book, Dillow manages to attack many of the platitudes of establishment economists and neoliberal chatterers like Tom Friedman. For example, he points out that the natural tendency of technical change is to reduce the international division of labor. The increasing speed with which technology crosses national borders means that particular nations maintain comparative advantage for shorter and shorter periods. "that tends to limit the international division of labour and, with it, world trade growth." [p. 45] And as I recall someone else suggesting, a great deal of "comparative advantage" is the artificial result of "intellectual property" [sic] laws.

He is merciless in attacking the New Labour love affair with education as the solution to poverty (likewise beloved of social engineers in this country, both liberal and neocon). The real benefit of education, from the perspective of the corporate economy, is its function in signalling a "good attitude": educated workers have "a high marginal utility of income, a propensity for hard work, ...and an ability to identify with managers rather than workers."

If education works by changing our characters, and by straightening the crooked timper of humanity into something useful to bosses, prosperity is achieved by sacrificing liberty and diversity to managerialism. [p. 119]

What's more, as the impolitic Joe Bageant argued, the social engineering panacea of education depends on a fallacy of composition. While individuals can increase their chances of advancement by education, the entire population cannot do so. The Empire requires some 25% or so of the population to fill supervisory, administrative and technical slots. Increasing higher education beyond this share of the total population simply increases the competition for those slots and drives down salaries, while inspiring an authoritarian, dog-eat-dog attitude on the part of the winners toward the losers. It inspires, that is, the same status anxiety that motivated so much of the German lower middle class to support Hitler.

Kevin Carson on Naomi Klein

This is a superb piece. Kevin Carson critiques Naomi Klein's Shock Doctrine from a free market anti-capitalist perspective. However, it is also a free market anti-capitalist attack on Actual Existing Capitalism. Apols for the lack of links: there were so many...please check Kevin's original article at his blog.

Friday, November 02, 2007
Naomi Klein: The Shock Doctrine

Naomi Klein, to a casual reader, might seem to hate the free market. Or at least she hates what most people think of as the free market, based on the conventional use of that term by mainstream politicians and journalists. And the usual vulgar libertarian suspects (see here and here and here) have reacted with exactly the kind of by-the-numbers polemics you'd expect. (She's met with a more open-minded reception from real libertarians. See, for example, Sheldon Richman, "Naomi Klein: Free Market Ally?" and Kehlkopfmikrofon, "Left-Libertarian Perspectives on Naomi Klein.")

If Klein hates what she mistakenly believes is the free market, the blame is pretty easy to assess: for the most part the very same folks at Cato, the Adam Smith Institute, and their ilk, that have their panties in such a wad over her book. As I've repeatedly said in the past, if I thought the free market actually meant what those people mean when they talk about "free markets," I'd hate it myself.

It's hard to spend any time at all in the allegedly "libertarian" parts of the Web without being deluged by commentary defending corporate globalization, CO2 emissions, Third World landed oligarchies, Nike's sweatshops, Wal-Mart, Big Pharma's profits, CEO salaries, and Microsoft's market share, all based on the principles of "the free market."

From Smith to Ricardo and Mill, classical liberalism was a revolutionary doctrine that attacked the privileges of the great landlords and the mercantile interests. Today, we see vulgar libertarians perverting "free market" rhetoric to defend the contemporary institution that most closely resembles, in terms of power and privilege, the landed oligarchies and mercantilists of the Old Regime: the giant corporation. When the "free market" is perverted to defend such odious interests, it's not hard to see why sane people view it with the same apprehension they normally reserve for the bubonic plague. Make no mistake: I hate such commentary, and the agenda behind it, with every fiber of my being. But it's not the free market.

If Germany had won the war, there would probably be a mushroom proliferation of Nazi "free market" think tanks (not inconceivably staffed by a considerable portion of the Austrian diaspora returned from America) defending the profits of Krupp and I.G. Farben in terms of "free market principles," along with the Nazi equivalent of Nike sweatshops in Eastern Europe and black Africa. All decent people would hate such intellectual vermin and their monstrous version of the "free market." The version of the "free market" defended by neoliberals and vulgar libertarians in our own world is only better in degree, and even that probably not by much.

Klein uses the term "disaster capitalism" to refer to the neoliberal modus operandi of "waiting for a major crisis, then selling off pieces of the state to private players while citizens [are] still reeling from the shock, then quickly making the 'reforms' permanent."

It's a very real phenomenon. As an account of the process of neoliberal "reform" as it occurred in country after country, and a chronicle of the corrupt collusion between government and corporate interests in formulating the "reforms," it is an outstanding reference work. The endnotes alone are immensely valuable.

My main objection, to repeat, is to her misuse of the term "free market" to describe such policies. Most of the examples of "free market reform" Klein describes could be more accurately described as "economic fascism." What passes for "free market reform," "deregulation," and "privatization" among the neoliberals is probably at least as statist as the various social democratic and mixed economy models to which neoliberalism is opposed. As Nicholas Hildyard argues in "The Myth of the Minimalist State,"

Far from doing away with state bureaucracy, free market [sic] policies have in fact reorganised it. While the privatisation of state industries and assets has certainly cut down the direct involvement of the state in the production and distribution of many goods and services, the process has been accompanied by new state regulations, subsidies and institutions aimed at introducing and entrenching a "favourable environment" for the newly-privatised industries.

The state has actually played a central role in implementing free market [sic] policies and, moreover, has a continued "intimate and ubiquitous" involvement in regulating the minutiae of the market economy -- a direct consequence of the hand-in-glove relationship that free market [sic] governments have fostered between "adjusted" state institutions and market interests....

A good example is the standard neoliberal model of "privatization," as carried out by Milton Friedman in Chile and Jeffrey Sachs in Russia. As Klein herself puts it in regard to New Orleans' massive post-Katrina conversion to charter schools (involving almost the entire school system), neoliberal "privatization" of public functions usually results in "publicly funded institutions run by private entities according to their own rules." [p. 5] Another variant of the same phenomenon is taxpayer-funded vouchers, a favorite of the folks at Cato, the ASI, and the Heritage Foundation. It was implemented in Pinochet's Chile, among other places.

Perhaps the most egregious example of this phenomenon is the fascist economy that has grown up around the national security state, including both the "private" firms that act as camp followers to the U.S. military in its wars abroad, and the "private" firms contracting with Homeland Security and other police state agencies at home. Klein, who aptly calls it the "disaster capitalism complex," considers it the booming sector of the economy in the same way as housing until recently, and the tech sector before that.

In my opinion the very term "private sector," in regard to such entities, is grossly misleading. Big business interests whose profits depend on direct subsidies and protections from the state are, in fact, a part of the state. If Marx was right in calling the state "the executive committee of the ruling class"--and I think he was--then the owners and managers of the corporate economy make up the lion's share of that ruling class. Corporate directors and senior management from the state capitalist sector constantly shuffle, in classic revolving door style, into political appointments in the state apparatus and then back to "private" employment.

Brad Spangler put it this way:

...one robber (the literal apparatus of government) keeps you covered with a pistol while the second (representing State-allied corporations) just holds the bag that you have to drop your wristwatch, wallet and car keys in. To say that your interaction with the bagman was a “voluntary transaction” is an absurdity. Such nonsense should be condemned by all libertarians. Both gunman and bagman together are the true State.

Large corporations are neither passive victims nor passive beneficiaries of the state; they act through the state. Or rather, to a large extent they are the state. It makes about as much sense to separate them from the state, as it would have made to separate the landholding class from the state in Medieval times.

And here's how the Libertarian Alliance's Sean Gabb described the model of fake "privatization" promoted by the Adam Smith Institute:

As reconstructed in the 1980s - partly by the Adam Smith Institute - the new statism is different. It looks like private enterprise. It makes a profit. Those in charge of it are paid vast salaries, and smugly believe they are worth every penny....

But for all its external appearance, the reality is statism. And because it makes a profit, it is more stable than the old. It is also more pervasive. Look at these privatised companies, with their boards full of retired politicians, their cosy relationships with the regulators, their quick and easy ways to get whatever privileges they want....

As with National Socialism in Germany, the new statism is leading to the abolition of the distinction between public and private. Security companies, for example, are being awarded contracts to ferry defendants between prison and court, and in some cases to build and operate prisons. This has been sold to us on the - perfectly correct - grounds that it ensures better value for money. But it also involves grants of state powers of coercion to private organisations. All over the country, private companies are being given powers of surveillance and control greater than the Police used to possess.

....There has been no diminution in the economic power of the State, only a change in its mode of operation....

Sometimes neoliberal "privatization" involves not just the contracting out of public functions with continued taxpayer funding, but the auctioning off of state assets. The process generally goes something like this: The World Bank cultivates technocratic elites within a Third World government, educating them in the neoliberal model of economic development and promoting their autonomy from democratic political pressure. The World Bank acts collusively with these elites to arrange loans for building the transportation and utility infrastructure needed for Western industry to build profitable facilities in the country. When the country incurs a crushing debt load, owing to the collusion between domestic technocratic elites and the World Bank, the World Bank and IMF use the debt as leverage to impose a "structural adjustment reforms," including "privatization" of the very infrastructure that was created at taxpayer expense to subsidize Western industry. Naturally, the infrastructure is bought up by Western capital--the same interests it was originally built at taxpayer expense to serve--for pennies on the dollar. During the privatization process, the Third World government may invest more money in the infrastructure, to make it salable, than it gets from the sale. And following "privatization," the new owners' first order of business will be systematic asset stripping, with the income from sale of capital assets exceeding what they paid for the infrastructure. Pretty neat, huh?

Sean Corrigan described the process in more colorful terms:

Does he [Treasury Secretary O'Neill] not know that the whole IMF-US Treasury carpet-bagging strategy of full-spectrum dominance is based on promoting unproductive government-led indebtedness abroad, at increasingly usurious rates of interest, and then – either before or, more often these days, after, the point of default – bailing out the Western banks who have been the agents provocateurs of this financial Operation Overlord, with newly-minted dollars, to the detriment of the citizenry at home?

Is he not aware that, subsequent to the collapse, these latter-day Reconstructionists must be allowed to swoop and to buy controlling ownership stakes in resources and productive capital made ludicrously cheap by devaluation, or outright monetary collapse?

Does he not understand that he must simultaneously coerce the target nation into sweating its people to churn out export goods in order to service the newly refinanced debt...?

Joseph Stromberg referred to such privatization of state assets as "funny auctions, that amounted to new expropriations by domestic and foreign investors."

Proposals to auction off Iraqi properties, with the state acting as effective owner, would likely lead, if implemented, to a massive alienation of resources into the hands of select foreign interests.

...and for Stromberg, a real free market libertarian, remember, this is a bad thing.

The textbook case of "funny auctions" was the looting carried out under the supervision of Yeltsin and Sachs. The Russian state ministers transferred enormous public funds into banks owned by the oligarchs--themselves major figures in the state and former Communist Party leadership. The oligarch's banks, in turn, conducted the privatization auctions of state industry--and they bid on it themselves, using the embezzled funds received from the government. [p. 233] Klein refers to it as "the strip mining of an industrialized state." [p. 242] This, by the way--and Yeltsin's suspension of parliament and rule by decree--went largely unremarked on by the same people currently squealing about Putin's authoritarianism. The difference is that Putin is using his muscle against the oligarchs and even Western capitalist interests.

Neoliberal "privatization" may leave a larger share of functions under nominally private direction, but the new "private" enterprises operate within a web of protections, advantages and subsidies defined by the state.

A much better model for privatization is that of Murray Rothbard and Karl Hess. As Hess argued in 1969, real free market libertarians don't reflexively defend anything that's called "property."

The truth, of course, is that libertarianism wants to advance principles of property but that it in no way wishes to defend, willy nilly, all property which now is called private.

Much of that property is stolen. Much is of dubious title. All of it is deeply intertwined with an immoral, coercive state system which has condoned, built on, and profited from slavery; has expanded through and exploited a brutal and aggressive imperial and colonial foreign policy, and continues to hold the people in a roughly serf-master relationship to political-economic power concentrations.

Hess called for creative libertarian analysis, confronting issues of "the revolutionary treatment of stolen "private" and "public" property in libertarian, radical, and revolutionary terms." For example, he asked, "What... should happen to General Motors in a liberated society?"--a question that's never been raised at the Cato Institute or the Heritage Foundation, I'll wager. ["The Student Revolution," The Libertarian (soon renamed The Libertarian Forum) May 1, 1969, p. 2.]

Rothbard attempted to provide some answers to the question Hess raised. He argued that state property should simply be treated as "unowned," and then homesteaded by those currently occupying and using it. In the case of utilities and other public services, this would mean turning them into consumer cooperatives. Universities would be turned either into consumer cooperatives, owned by student guilds, or into producer co-ops owned by the faculty. State-owned industry should be handed over to its workers. He even argued that private industry that got the majority of its profits from the state should be treated as state property and homesteaded by its workers. ["Confiscation and the Homestead Principle," The Libertarian Forum June 15, 1969 p. 3]

In the specific case of the post-Soviet economies and other state socialist countries attempting market reforms, he argued in "How and how not to desocialize" that state property should be privatized on the principle of "all land to the peasants, all factories to the workers!" ["How and How Not to Desocialize," The Review of Austrian Economics 6:1 (1992) 65-77]

That was, incidentally, the form of privatization actually envisioned by Solidarity at the fall of the pro-Soviet regime: the transformation of all state enterprises into workers' co-ops. But under the influence of the Chicagoids who infested Poland, with their dire threats of capital flight, the new Solidarity government was browbeaten into opening the country up to corporate looting. That was the model envisioned by Gorbachev (surely a more legitimate claim to the name of "free market reform" than what actually occurred), before a wrathful deity visited Russia with the triple calamity of Yeltsin, Sachs, and the oligarchs. I'll take emerods in my secret parts any day.

Neoliberal policies depart from genuine free market principles in numerous other ways.

For example, they tend to be adopted in contexts where corporate elites desire to roll back the bargaining power of labor. The governments that adopt Chicago School policies also tend to terrorize unions and other forms of poltical organization by workers in ways that no genuine believer in free markets could possibly support (any implied commentary on George Reisman is very much intentional).

A large part of he appeal of Chicago School economics was that, at a time when radical-left ideas about workers' power were gaining ground around the world, it provided a way to defend the interests of owners... [p. 52]

As the countries of the South American cone, one after another, fell under military dictatorships and played host to pestilential swarms of Chicago Boys, the first targets of their terror were the trade unions and their parties. And they were actively encouraged by Kissinger. [p. 97] The main purpose of the infamous Operation Condor was to organize mutual support among the intelligence operations of the South American military dictatorships, in identifying and assassinating the leaders of the left-wing opposition. In several countries of the region, military coups were followed immediately by raids on trade union headquarters, and by military raids on factories in which union organizers and radicals--helpfully pointed out by managers--were "disappeared." [p. 106]

Now, even by the avowed principles of the vulgar libertarians, labor and capital are supposedly coequal "factors of production." Imagine the reaction at Cato or the ASI if corporate headquarters were raided and terrorized in the way that union headquarters were, or if prominent and influential capitalists were tortured, murdered, and "disappeared," and later discovered in ditches with their faces hacked off, as a means of intimidating them and reducing the bargaining power of capital in the market. The difference, for the Catoids and Misoids, is that such treatment of labor is a regrettable necessity, or an aberration in the "political" realm that did not affect the fundamentally "free market" orientation of the regime; identical policies carried out against capital, on the otherhand, would be directly repugnant to their "free market" principles. The control of the state by the owners of one "factor of production" (capital), and the use of state power to terrorize the owners of another "factor of production" (labor-power) on behalf of capital, is just as repugnant to free market principles as the reverse case.

There's nothing inherent in free market principles, as such, that implies greater affinity for owners than workers. In fact, one can make a free market argument (as I repeatedly have) that the state's interventions in the market have served mainly the interests of the owning classes, to the great detriment of the bargaining power of labor. Taft-Hartley, for example, surely had that effect. So did the draconian police state regime imposed on the British working classes (e.g. the Laws of Settlement, the Riot Act, and the Combination Laws) during the early Industrial Revolution. The state's enforcement of artificial scarcity in land and capital, by maintaining entry barriers and other special privileges on behalf of landlords and capitalists, makes the means of production artificially scarce and expensive for workers so that they are forced to sell their labor in a buyer's market. Instead of jobs competing for workers and driving down the rate of profit until wages equal the full product of labor, which would be the case in a free market without such special privilege, we have instead a state of affairs in which workers are forced to compete for jobs and drive down wages, and pay a form of tribute for access to the means of production.

The neoliberal version of "free markets" tends to reflexively support any title to "private property" in land, with absolutely no regard to issues of just acquisition. In all the Latin American countries where the Chicago Boys were given free rein, land reforms were reversed and the peasants' land restored to the latifundistas and other feudal landed oligarchs. And every time a left-leaning Third World government nullifies the illegitimate titles of such feudal elites, and gives the land to its rightful owners--the peasants working it--the predictable squeals of outrage start among the Catoids.

The only form of property the Catoids and other vulgar libertarians don't respect is the property of ordinary working people. In Sri Lanka after the Tsunami, and in New Orleans after Katrina, one of the top items on the agenda, as a condition for disaster relief aid, was to eliminate legal barriers to expropriating and evicting poor people from land desired by commercial interests. In Sri Lanka, the reconstruction plan was drafted by a coalition of businesspeople, of whom the largest portion represented the tourist industry that coveted beachfront property. The plan they came up with included the eviction of entire beachfront villages so their land could be used for hotels, and the use of disaster relief funds to provide corporate welfare for superhighways and industrial port facilities.[pp. 292-293, 297] The same pattern was followed in India and Indonesia, with peasants forbidden to rebuild on their own land, driven into holding camps, and their land (and lots of aid) given to hotel companies. [p. 399] In Honduras after Hurricane Mitch, the mining laws were changed to make it easier to evict peasants from land the mining companies wanted. [p. 395]

But there is absolutely no legitimate basis in free market principle for the artificial property rights of feudal landlords. I admit I'm not a typical free market advocate in that regard. As an individualist anarchist, I tend to be hostile toward absentee landlords in principle; that sets me apart from the libertarian mainstream, which is predominantly Lockean (with a large minority of Georgists thrown in for good measure). But even the Lockean principles of Murray Rothbard and his followers are fundamentally hostile to the artificial property rights of quasi-feudal landlords like the latifundistas of Latin America. Rothbard denounced such feudal property titles in no uncertain terms.

10. The Problem of Land Theft

...suppose that centuries ago, Smith was tilling the soil and therefore legitimately owning the land; and then that Jones came along and settled down near Smith, claiming by use of coercion the title to Smith’s land, and extracting payment or “rent” from Smith for the privilege of continuing to till the soil. Suppose that now, centuries later, Smith’s descendants (or, for that matter, other unrelated families) are now tilling the soil, while Jones’s descendants, or those who purchased their claims, still continue to exact tribute from the modern tillers. Where is the true property right in such a case? It should be clear that here, just as in the case of slavery, we have a case of continuing aggression against the true owners—the true possessors—of the land, the tillers, or peasants, by the illegitimate owner, the man whose original and continuing claim to the land and its fruits has come from coercion and violence.... In this case of what we might call “feudalism” or “land monopoly,” the feudal or monopolist landlords have no legitimate claim to the property. The current “tenants,” or peasants, should be the absolute owners of their property, and, as in the case of slavery, the land titles should be transferred to the peasants, without compensation to the monopoly landlords....

11. Land Monopoly, Past and Present

Land monopoly is far more widespread in the modern world than most people—especially most Americans—believe. In the undeveloped world, especially in Asia, the Middle East, and Latin America, feudal landholding is a crucial social and economic problem—with or without quasi-serf impositions on the persons of the peasantry.... [American "free market"] preachments naturally fall on deaf ears, because “free market” for American conservatives obviously does not encompass an end to feudalism and land monopoly and the transfer of title to these lands, without compensation, to the peasantry....

American conservatives... exhort the backward countries on the virtues and the importance of private foreign investment from the advanced countries, and of allowing a favorable climate for this investment, free from governmental harassment. This is all very true, but is again often unreal to the undeveloped peoples, because the conservatives persistently fail to distinguish between legitimate, free-market foreign investment, as against investment based upon monopoly concessions and vast land grants by the undeveloped states. To the extent that foreign investments are based on land monopoly and aggression against the peasantry, to that extent do foreign capitalists take on the aspects of feudal landlords, and must be dealt with in the same way....

Another divergence of neoliberal "market reform" from the real thing is its treatment of odious debt. In country after country, even as the neoliberals lauded the global "sweep of democracy," they refused any forgiveness of debts acquired by the previous military regimes--such debts acquired, by the way, largely to create the subsidized transportation and utility infrastructure necessary to render Western capital investments profitable (when not used, that is, to fund the repressive military and police apparatus). [pp. 156-157]

The neoliberal version of "market reform," as opposed to the real thing, tends to take a jaundiced view of tort liability law and its use to hold corporate interests accountable for the harm they do. We've seen this domestically, with "tort reform" being a top item on the corporate agenda during the past two decades. In Iraq, the CPA puppet regime indemnified American crony capitalists of liability for any actions taken in that country. [p. 358] In effect, Bremer resurrected the venerable principle of extraterritoriality. Real free market libertarians, on the other hand, view a vigorous tort law regime as the free market alternative to the regulatory state. Real free market libertarians consider the evisceration of traditional common law liability in the nineteenth century, by judges in the service of commerical interests, to be a bad thing. In a genuine free market order, corporations that dumped waste or polluted groundwater would be eaten alive by lawsuits.

Finally, although Klein devotes little attention to it, a central preoccupation of the Washington Consensus, and in the model of disaster capitalism imposed in the areas under its thumb, is "intellectual property" [sic]. Although I haven't managed to track it down, I still recall a statement by Paul Bremer in 2003 announcing that the goal of the Coalition Political Authority was to create a market democracy with "strong intellectual property rights." Now so-called "intellectual property" is an abomination to free market principles.

The main function of patents, domestically, was to enable the cartelization of industry through patent control. General Electric and Westinghouse, for example, cartelized the home appliance industry by an exchange of patents. The power of AT&T was rooted in the Bell Patent Association. Internationally, patents give transnational corporations a monopoly on the newest generation of production technology, effectively enabling them to lock host countries into supplying sweatshop labor for foreign-owned industry. "Intellectual property" is especially important to the new global economy. It's hardly coincidental that the sectors of the American corporate economy that flourish in the global economy are all heavily dependent either on direct subsidies, on patents and copyrights, or both: agribusiness and biotech, software, entertainment, electronics, and arms. If patents, copyrights, and excessive trademark rights disappeared, most of the global economy would vanish right along with them. The first order of business of any genuine free market regime would be to repudiate--totally--the IP accords of the Uruguay Round of GATT. The first order of business in Washington, of course, would be to declare it a terror state.

Klein herself admits at times that the neoliberal policies she rightly condemns are not consistent with genuine free market principles. For example:

Friedman framed his movement as an attempt to free the market from the state, but the real-world track record of what happens when his purist vision is realized is rather different. In every country where Chicago School policies have been applied over the past three decades, what has emerged is a powerful ruling alliance between a few very large corporations and a class of mostly wealthy politicians--with hazy and ever-shifting lines between the two groups. In Russia, the billionaire private players in the alliance are called "the oligarchs"; in China, "the princelings"; in Chile, "the piranhas"; in the U.S., the Bush-Cheney campaign "Pioneers." Far from freeing the market from the state, these political and corporate elites have simply merged, trading favors to secure the right to appropriate precious resources previously held in the public domain--from Russia's oil fields, to China's collective lands, to the no-bid reconstruction contracts for work in Iraq.

A more accurage term for a system that erases the boundaries between Big Government and Big Business is not liberal, conservative or capitalist but corporatist. Its main characteristics are huge transfers of public wealth to private hands, often accompanied by exploding debt, an ever-widening chasm between the dazzling rich and the disposable poor and an aggressive nationalism that justifies bottomless spending on security. For those inside the bubble of extreme wealth created by such an arrangement, there can be no more profitable way to organize a society. But because of the obvious drawbacks for the vast majority of the population left outside the bubble, other features of the corporatist state tend to include aggressive surveillance (once again, with government and large corporations trading favors and contracts), mass incarceration, shrinking civil liberties and often, though not always, torture. [p. 15]

It's clear that Chile was never the laboratory of "pure" free markets that is cheerleaders claimed. Instead, it was a country where a small elite leapt from wealthy to super-rich in extremely short order--a highly profitable formula bankrolled by debt and heavily subsidized (then bailed out) with public funds. When the hype and salesmanship behind the miracle are stripped away, Chile under Pinochet and the Chicago Boys was not a capitalist state featuring a liberated market but a corporatist one. Corporatism, or "corporativism," originally referred to Mussolini's model of a police state run as an alliance of the three major power sources in society--government, businesses and trade unions--all collaborating to guarantee order in the name of nationalism. What Chile pioneered under Pinochet was an evolution of corporatism: a mutually supporting alliance between a police state and large corporations, joining forces to wage all-out war on the third power sector--the workers--thereby drastically increasing the alliance's share of the national wealth....

...[P]erhaps shock treatment was never really about jolting the economy into health. Perhaps it was meant to do exactly what it did--hoover wealth up to the top and shock much of the middle class out of existence. [p. 86]

...[China] is a mirror of the corporatist state first pioneered in Chile under Pinochet: a revolving door between corporate and political elites who combine their power to eliminate workers as an organized political force. [p. 190]

But following every such burst of clarity, she immediately resumes identifying the neoliberal agenda with the "free market." For example, the passage on p. 15 block quoted above is followed directly, in the very next paragraph, by this sentence: "From Chile to China to Iraq, torture has been a silent partner in the global free-market crusade." By my count, she misuses "free market" in this way some times.

I think I understand why she does it. That is, after all, the conventional usage of "free market" in mainstream American politics and in the mainstream press. Just this past week, I heard a pinhead on some conservative talk radio show contrast the Canadian single payer healthcare system to "our free market system" of healthcare--the latter industry being, in fact, about as heavily subsidized, protected and cartelized as the aerospace industry.

Although she seems aware that what the neoliberal politicians and journalists call the "free market" agenda is in fact a highly statist form of corporatism, she does not seem to be aware that their use of the free market label is heavily contested by a genuine, philosophically consistent strand of free market thought. Although she often judges the neoliberal version of "free markets" by their corporatist reality, she neglects even to consider the possibility of an intellectually honest free market movement that judges such corporatism illegitimate in terms of genuine free market principles.

And in taking the neoliberal use of "free market" at face value, she also seems unaware of just what an enormous ideological victory she's handing the corporate ruling class.

As Sean Gabb argued, it's about as legitimate to identify the existing neoliberal model of corporate globalization with "free markets" and "free trade" as it would be to call the Soviet oligarchy under Stalin with "workers' power." The transnational corporations and financial elites, and the neoliberal court intellectuals who service them, have appropriated the language and symbolism of the classical liberal movement to legitimize their corrupt power interests. In much the same way, Stalin appropriated the libertarian and humanist symbolism of the nineteenth socialist movement to letitimize the exploitative class system under the Party apparat.

The neoliberals have no more right to the heritage of the classical liberal movement--to the thought of Thomas Hodgskin, Benjamin Tucker, Lysander Spooner, and Franz Oppenheimer--than Stalin had to the red banner and the Internationale. The language of free market liberalism ought to burn their filthy mouths; by their very use of the term, they set themselves up as an abomination of desolation in the holy place.

Most importantly, one of the most effective weapons we have against corporate power and its intellectual mouthpieces is to demonize the neoliberals in terms of their own professed "free market values," and show them up for the corporate welfare parasites they really are.

There is, in fact, a considerable degree of mirror imaging between the mainstream right and left, when it comes to this understanding of free markets. The corporate economy and its court intellectuals have a vested interest in promoting the belief that big business got that way because of superior efficiency and other competitive virtue in the "free market." Big government liberals, on the other hand, have a parallel vested interest in pretending that the concentration of wealth and corporate power is the inevitable result of the normal market process, and the only way to stop it is to create a centralized government bureaucracy run by them.

Klein buys into the liberal side of this matrix reality when she regurgitates Art Schlesinger's goo-goo myth of the New Deal, referring to the Great Depression as a "market-created disaster" and the New Deal as "the end of laissez-faire." [p. 54]

A genuine laissez-faire economy would have produced something about as far from the state of affairs in 1929 as you could get. Absent the role of the state-promoted national railroad system in creating a centralized national market for firms operating on a national scale, absent the cartelizing effects of patents and tariffs, and absent the cartelizing effects of "Progressive" Era regulation, I would expect the American pattern of industrialization to have looked a lot more like something envisioned by Kropotkin and Lewis Mumford, and a lot less like something out of Schumpeter and Chandler.

Klein also buys into the Schlesingerite idea that American big business "grudgingly accepted" the New Deal. [p. 251] Big business didn't grudgingly accept the New Deal; it designed the New Deal. I strongly recommend G. William Domhoff's work (especially The Power Elite and the State and The Higher Circles) on the role of GE's Gerard Swope and the Business Advisory Council in formulating FDR's economic agenda. The blueprint they originally came out with, the NIRA, was a classic example of the kind of corporatist economy that Klein refers to elsewhere. It might have come from the desk of Hjalmar Schacht in Nazi Germany: it essentially organized every major industry into a state-authorized and state-protected cartel, with the avowed purpose of restricting production and keeping up prices. In other words, had it been allowed to stand it would have done, successfully, exactly what the great trusts at the turn of the century had tried and failed to do, by private means.

While acknowledging a legitimate role for markets, Klein calls for tempering "market fundamentalism" by such expedients as

requir[ing] corporations to pay decent wages, to respect the right of workers to form unions, and for governments to tax and redistribute wealth so that the sharp inequalities that mark the corporate state are reduced. [p. 20]

This implies that such "sharp inequalities" actually result from the unregulated market, and not from active state intervention on behalf of privileged capitalist elites. In fact our billionaire plutocracy and CEOs like Welch and Nardelli are not the products of a free market. They're turtles on fenceposts. In a genuine free market, organized around the principle of equal exchange and free from special privilege, the natural tendency is for prices to fall to production cost and for short-term entrepreneurial profits for innovative behavior to fall to zero as competitors enter the market and adopt new techniques. The only way to draw perpetual profits from innovation is to erect market barriers. R.A. Wilson made essentially this argument in The Illuminatus! Trilogy:

If you and I exchange equal goods, that is trade: neither of us profits and neither of us loses. But if we exchange unequal goods, one of us profits and the other loses. Mathematically. Certainly. Now, such mathematically unequal exchanges will always occur because some traders will be shrewder than others. But in total freedom—in anarchy— such unequal exchanges will be sporadic and irregular. A phenomenon of unpredictable periodicity, mathematically speaking. Now look about you, professor— raise your nose from your great books and survey the actual world as it is— and you will not observe such unpredictable functions. You will observe, instead, a mathematically smooth function, a steady profit accruing to one group and an equally steady loss accumulating for all others. Why is this, professor? Because the system is not free or random, any mathematician would tell you a priori. Well, then, where is the determining function, the factor that controls the other variables? You have named it yourself, or Mr. Adler has: the Great Tradition. Privilege, I prefer to call it. When A meets B in the marketplace, they do not bargain as equals. A bargains from a position of privilege; hence, he always profits and B always loses. There is no more Free Market here than there is on the other side of the Iron Curtain.

Interestingly, an article in New Scientist observed that wealth among the richest 3% of the population followed a power law distribution described by Pareto: in layman's terms, "to him that hath, much shall be given." The distribution of wealth for everyone else, on the other hand, corresponded to the law that describes the spread of energies of atoms in a gas.

Klein also takes at face value the corporate liberal rhetoric used to sell the IMF and World Bank in the 1940s [p. 162]--when, as pointed out by Gabriel Kolko in The Politics of War, their actual purpose was to subsidize the disposal of surplus American goods and capital in foreign markets. The World Bank and IMF were created as an adjunct of William Appleman Williams' "Open Door Imperialism," a safety valve for the chronic overproduction and overaccumulation under state capitalism.

Klein sees the spread of anti-Washington and anti-neoliberal regimes, especially in Latin America, as a sign of hope; this is the subject of her conclusion, appropriately titled "Shock Wears Off." The usual suspects at Cato, predictably, have turned Chavez and Morales as whipping boys. But the economic model pursued by the "Bolivarian revolution" is arguably no more statist than that of the Washington consensus. The land policy of Chavez and Morales, and of the Landless Workers Movement in Brazil, is far more legitimate from a free market standpoint than the Catoids' instinctive sympathy for the latifundistas. And Chavez's nationalizations and his subsidies to the cooperatives are no more statist than the policies pursued under the Washington consensus; they're just statist in a different direction. Frankly, when a former ruling class starts tasting a bit of the repressive medicine it was formerly accustomed to spooning out, it's hard for me to work up too much moral outrage.

The Catoid reaction to Chavez is fairly typical of vulgar libertarianism: corporate welfare and special protections for the rich are kinda sorta bad, in principle, maybe, I guess, and we oughta possibly, maybe, get around to writing a position paper on it someday... But welfare and protections for the poor and for aid to cooperative enterprise, now--they're flaming red ruin on wheels! A Pinochet who terrorizes unions and transfers land from the peasants to the oligarchy, well, that's too bad, I guess, but you've gotta break a few eggs, and yada yada yada.... But a Chavez who uses a bit of muscle on Western-owned corporations--why that's an outrage!

The reaction among American elite circles to the authoritarianism of Yeltsin and that of Chavez, respectively, speaks volumes. Nothing Chavez has done yet has remotely approached the openly avowed "Pinochet option" taken by Yeltsin, and his use of tanks to shut down the Russian parliament. None of Chavez's nationalizations remotely approaches the sheer scale of looting that transferred state assets directly into the bank accounts of the oligarchs.

Like Klein, I also see Chavez and allied regimes as a net positive force. Until about a decade ago, the Washington Consensus was almost universally regarded as "the only game in town." Now these new regimes, as statist in many ways as they admittedly are, are presenting a fundamental challenge to the statist global order that corporate capital depends on. The Washington Consensus is no longer the only game in town. If we're going to have one superpower, it's better that it be restrained by another one.

I've argued in the past that one of the best things we could hope for would be a concerted repudiation of neoliberalism, by a large enough number of Third World countries that they couldn't be crushed by American invasion or covert action. I can imagine a substantial agenda of "libertarian socialist" policies to be pursued by such a coalition, that would be closer to genuine free market principles than anything festering in the bowels of the Heritage Foundation. For starters, genuine land reform: nullifying the feudal titles of the landed oligarchies, granting full and permanent title to those cultivating, and restoring the land stolen in recent decades to those evicted from it (or their descendants). For another, a model of privatization that turns state services into consumer cooperatives, and state industry into worker cooperatives. For yet another, absolute and total repudiation of so-called "intellectual property" [sic] accords. Such a Third World coalition might wield, as its doomsday weapon, the threat of a coordinated repudiation of debt and/or of the dollar as reserve currency, and call on a coalition of Eurasian nuclear powers to protect them from military attack.

I am no social democrat. I'm under no illusions about the central role of big business in formulating the New Deal. I don't like statism of any kind. In my opinion, New Deal liberalism and the Reagan-Thatcher model of neoliberalism are like two farmers. The first farmer thinks he can get more work out of his livestock, in the long run, if he feeds them well and gives them comfortable shelter and sufficient rest. The second farmer thinks he can get more work out of them if he works them to death and then replaces them. There's no question that both "farmers" view us as "livestock," and that their prime concern is with their own profit. But I know which farm I'd rather live on.

Quite frankly, if my only choices are corporate liberalism and social democracy, and a banana republic on the neoliberal model, I'll take the former any day. If I get to choose between the paternalism of Brave New World and the jackboot in my face of 1984, it won't take me long to decide. I'm not ashamed to say that if my only choices are the welfare statist and neoliberal versions of statism, I'll take the kind of statism whose yoke weighs less heavily on my own back.

But my hope is that the social democratic statism of the Chavez-Morales bloc in the Third World, aligned with the European variant of mixed capitalism, will serve as an effective counterbalance against the neoliberal world order, and provide enough breathing room that both systems will be open to genuine libertarian change. My hope is that Chavez's aid to cooperatives and the solidarity economy, when all is said and done, will even out the previous statism in the other direction, and leave in place a decentralized and cooperative economy that will be able to survive on a stable basis when the oil subsidies are withdrawn and Chavez is long gone. My hope, above all, is that, as the two world power blocs fight each other to a standstill, we--the working people in both blocs--can build a genuine alternative from the ground up, in the interstices of both systems. We can build an economic order based on self-governing neighborhoods, cooperatives, LETS systems, peer production, mutual aid associations, human-scale technology, community-supported agriculture, and the informal and household economies, linking all those facets together into a coherent counter-system, that will be ready to replace the corporate economy in the one sphere and the bureaucratic state in the other when the two systems of power reach their limits. We can, in short, build the foundation of the new society within the shell of the old.

Finally: I must stipulate that I regard Klein's symbolic identification of economic shock treatment with the literal electroshocks used by CIA interrogators and Third World secret police as quite forced. Nevertheless, her chapter on the history of the American role in refining and promoting torture, from the development of the techniques in MK Ultra, through their promotion by the Green Berets and SOA in an endless series of atrocities, to the use of the very same techniques against Jose Padilla and the detainees at Gitmo and Abu Ghraib, is a brilliant work of research in its own right. For any serious student of the subject, the chapter alone is worth the price of the book.