mutualism

The latest instalment in my tour round the libertarian/anarchist "classics" brings me to a work very appropriate for today's messed up world.  In "Mutual Banking" American Individualist Anarchist William Batchelder Greene explains clearly what is wrong with the current banking system (now, just as much as then) and proposes a non-profit mutual bank as a solution.

The bankers, he says, are the new aristocracy who, with state collusion through banking licensing and legal tender laws can buy up all the assets of a country and leave its people bankrupt and destitute.  They control access to money and credit and can pick and choose those industrious would be entrepreneurs who will win and lose by their actions.

He presents, at one point, an interesting argument for the repudiation of our current national debt - no real value would be destroyed by so doing, just an unwinding of the legal values that gives the elite few such an upper hand over the rest of us left paying for that debt.  If ever there was a time for revolution against the bankers it seems to me to be now.  

This will also be a good read/listen for those who do not understand the nature and inherent flexibility of money, such as a few of those at the "Speak Easy" last week.  Greene's solution, he says, would be inflation free, low cost, circulating currency backed by real assets that does not allow for a parasite class of bankers (or, indeed politicians) to take control.  If you ever wanted to know how a credit union worked, this will also provide much background information.

I am often finding that ideas that I develop for today's problems turn out to have been thought of many times before - Greene's model here describes with uncanny accuracy my proposal for an Oxfordshire local currency network for example.  This is not history - it is living proof that the problems we are facing now have been at the forefront of men's minds for decades and centuries - and that if we had only listened to the likes of Greene then we would be unlikely to be up this particular shit creek.  The Mutualists' message is, if anything, more important today for us having comprehensively ignored it for over a century and the problems getting a hundred times worse in the meantime.

You can get the text I have used (the 1870 publication) at the Libertarian Labyrinth website (.pdf), and attached you will find 12 files - an MP3 for each section, a .zip file of all the MP3s and an iTunes/iPod optimised .M4B file that has everything in one audiobook file with chapter bookmarks and so on.  

Enjoy.

 I don't know what I think about this.  Having only recently got over the shock of hearing my own voice on recordings, now I am challenged to see my "good face for radio" in glorious technicolour.

Anyway, I did promise that if my talk were recorded I'd point people to it.  The idea was to try to introduce "Mutualism" as an anarchist philosophy and as a mechanism for achieving a non-state society.  The discussion goes off into many other interesting issues such as money (see my frustrated post from the other day) and Ponzi welfare schemes.  I'm not sure how successful I was, but it was an interesting experience.

Jock Coats - An Introduction to Mutualism from oxford libertarian on Vimeo.

 Last week there was a long discussion following the Lib Dem Voice "Saturday debate" slot about "equality of opportunity" versus "equality of outcome".  I don't want to rehash that all here.  I was thoroughly frustrated in trying to get a fellow in the debate, apparently from the remnant Liberal Party, who was promoting some kind of "universal inheritance" policy funded by confiscating more of the inheritance of the wealthy, to understand that real liberalism needs to look at the causes of the disparity they seek to redress, and where it is already created or protected by the state, the preference should be to repudiate whatever interference causes such inequity before compounding one injustice, the accumulation of vast wealth at the expense of others, with another, the confiscation of that and further interference in peoples' economic lives.

Anyway, that's not what this is about.  He kept nagging me about what, as an "anarchist" would I "construct" instead of the state!  Well what a silly question.  I would not "construct" anything, if by that he implies that I might have some utopian blueprint that I would impose on everyone else.  That would not be liberty.  That would be a state.  But what I did say to him was that I was confident that humanity was sufficiently advanced for institutions to "arise" naturally to meet common needs and provide solutions to social problems.

His rejoinder was that the "state has arisen" in the past.  And, by implication, "why on earth do you think it would not arise again? " And I have to admit that that stumped me for a while.

And so thanks to The UK Libertarian blog I found this video by Stefan Molyneux about the origins and ends of states:

And the answer to my soi-dissant "Liberal" correspondent became obvious.  The state only originated in an act of aggression for which there were no structures to prevent or punish.  Why is it that people who oppose the idea of not having to kow-tow to governments feel that we have not developed one iota beyond the end of subsistence farming that prompted the first expropriation by a bigger neighbour?  The entire point of a market-anarchist no state society would be built on institutions arising to uphold two particular, natural and founding laws - of self-ownership and non-aggression.  A state, in such a system, could not commit that original act of aggression, conquest and confiscation with impunity.

 Well, I've been fretting for a few days about the bits I missed out of my talk at the Oxford "Speak Easy" last week.  Those who were there early enough heard me begin with a few lines from my notes, before I went rambling off elsewhere and lost my place, so whilst I mentioned that I'd like people to disassociate for the purposes of the discussion the (big-m) "Mutualism", the successor to the Individuality Anarchist movement, and the (small-m) "mutualism" that describes the use of a particular co-operative business form.  For whilst there are similarities, especially in their theoretical basis, there are also differences, especially in the way the Co-operative Movement in the UK operates.

But I think it is important to compare and contrast them, and I intended to do this on Wednesday night, but didn't get to that.  At the moment, politicians from all the main parties are talking about embracing mutualism, using co-operative businesses to deliver certain public services and so on.  And what worries me is that people will get the wrong idea about both co-operative businesses and about "Mutualism" and if these attempts to use co-ops in public policy do not work out as well as they are now being touted will be disillusioned with the idea of mutualism, and Mutualism, itself.

There has also been much discussion of this around the blogs and media recently, so I thought I would add my tuppence worth.

So some thoughts...

First the Co-operative Movement is innately anti-statist.  This may not appear to be the case in the UK where the Co-operative has established a political party, called, unsurprisingly, the Co-operative Party, and which many years ago now hitched itself to the party of the big state, the Labour Party.  But in its early years and, as some would say its hey-day, in which co-operative business forms were founded from the ground up, by ordinary people wanting to meet all sorts of their needs, for food, for insurance, for health care, housing and so on they worked in spite of the state which most often seemed to grant privilege to those who would rip them off.

Indeed, the first of the seven Co-operative Principles, based on those set down originally by the Rochdale Pioneers and now guarded and promoted by the International Co-operative Alliance reinforced that a co-operative is based on voluntary, open membership, for all people who are able to make use of the benefits the society is created to deliver.  It is inherently voluntarist - anarchist - the complete opposite of which is the sort of compulsory collectivist state socialism engages in.  Even when that state is apparently "democratic", it is still not voluntary in the same sense.  If you really don't like a democratic decision of your fellow co-op members, you can, ultimately part company; go and get whatever services or goods they deliver from somewhere else, or start another co-op.  Try doing that if you don't like the "democratic" decision that leads to one party running the country however they like.

So in this sense, the co-operative business form is a very useful one for those of us who see co-operatives and social enterprises not as a way of delivering government policies, but as a way to develop truly voluntarist means of doing what the state often does by coercive collectivism.  But it is only one business form of many, and to a large extent Mutualist-anarchists are agnostic about what business form should be used in any particular instance, just so long as it is not coercive.  

That said, there are some areas in which the co-operative form seems to me to give particular benefits; where for example a good or service is too big or difficult to procure individually, or where the different interests in an organisation, the workers, consumers, financiers and so on want to align their interests in the ongoing management of the organisation because of the nature of the sort of transaction they are involved in.  And schools might very well be a good example of this.  It's not something you want to change your supplier of every day.  You can buy your newspaper or groceries from a different person every time, but you will want some stability for your children's education.  So you may want to agree to participate in setting policy and direction in your chosen school alongside teachers and managers.  

Second, a co-operative business or a social enterprise is not a "not-for-profit".  I know that people have qualms about things they perceive as public services being delivered by organisations that aim to make a "profit", but it is simple fact that you cannot run a business without aiming to make a "profit" - to aim for "break even" is to fail.  What matters is what you do with that profit, perhaps.  And sure, in a shareholder owned limited company, the whole purpose of the business is to make financial gain for its investors.  But the same could be true of a co-operative.  There is nothing that prevents a co-operative business distributing its surplus to its owners.  In the case of the ubiquitous Co-operative Group retail businesses this usually involves sending us members discounts off our future purchases, but there's no reason why it should not be a cash dividend if that is what the co-operative membership decided.

But there are lots of other things that could be done with "profits" - there could be a policy to help finance other co-operatives start up, or local community activities or charities, or to reinvest everything into the profit generating organisation itself.  The really key thing about a co-operative is that it is owned by the members who join it because they benefit from the goods or services it delivers, as opposed to it merely being a financial investment where shareholders may have little interest or intention, or even ability, to use what their limited company produces.

And so, finally, to the various noises being made by political parties about "embracing mutualism", "encouraging co-operatives" and so on.  Of course, as someone who does not believe the state has legitimate roles in delivering what they call public services in any case, I also do not believe it has the right to control who delivers them, or to whom to devolve responsibility for some of them to.  The most state-collectivist activists would not accept a co-operative as a compromise in any case.  They would say that it is wrong in principle to incorporate what is currently delivered by a unique sort of an organisation - public custodians elected by everyone - because it creates an organisational form that is itself vulnerable to take-over.  Even if you establish your public service delivery co-operative as, to start with, a business whose rules say they must reinvest surpluses and so on, they will point to the demulualisation of our former mutual financial services sector as an example of where member/owners can be tempted out by big money and big business.

But more importantly, as in my first point above, co-operatives are about voluntarism and grass roots action by people who want to work together to secure some kind of a benefit more difficult or less satisfying to achieve on their own.  They are not, and should not, be agents of state policy, of top down devolution of something in which the state will then, inevitably, want to retain a significant amount of control.  

It has been incessant growth of state action in the spheres in which very many people were already making their own voluntary arrangements that has extinguished much of the thriving co-operative and mutual self-organised culture that previously flourished.  When Lloyd-George promoted unemployment insurance for example, he quoted in his budget that 90% of the people likely to benefit from the proposed state system were already covered through friendly societies and so on - so his state action was to replace all of this voluntary co-operation in order to fund a statist way of ensuring the other 10% had cover.

Whenever I was asked, such as in those "go round the table and introduce yourselves" moments, as a director or chair of Oxfordshire Social Enterprise Forum, or as a director of Social Enterprise South East, I would make the point that I was not a promoter of social enterprise for delivering on government commitments, but as promoting self-organised social market alternatives to government action.  And I hope other would be co-operators and social entrepreneurs will sup with a long spoon when the man from the government comes along offering them the chance to "run their own public services".

So, tonight was the big day of my talk to the "Speak Easy" event of the combined Oxford Libertarian Society, the Oxford University Liberal Democrats and Compass Oxford in which I was supposed to introduce "Mutualism".  A number of people managed to miss my opening pre-emptive self-abasement for not being a "lecturer" up to the usual standard of their invited speakers like Hans-Hermann Hoppe, Eric Mack or the many other illustrious names they have hosted.

The ability to take a lecture you have delivered hundreds of times, probably written many papers around and, more importantly, understand your subject in great detail having spent half a lifetime studying it is one to be admired!  By contrast my only real period of doing any "public" speaking was when I was on the city council, or occasionally at party conferences, and I manage to ramble on in just three minutes, let alone a nearly half hour talk.  Still, it was being recorded, so you will soon be able to see for yourselves how awful I must have been, and apologies in advance to anyone I upset with throwaway remarks (such as in particular, that I recall specifically, suggesting that Kevin Carson's books were too long - what I really meant to say was that they were "over my head" and one chapter was enough to keep me trying to "grok" what he is on about for several months - sorry Kevin, if you read this!).

But hopefully having set the ground rules that I was not intending to convey that I was the world's expert on Mutualism or indeed anything I was going to say, and that discussion would be more welcome than searching academic questions that I could not answer, we did have quite a good, and at time vigourous discussion afterwards, even if, as it seemed to me, not much of what either I said or the discussion itself was terribly specific to Mutualism.

Anyway, the reason for writing, and the title of this blog, is to highlight one issue that came up in the discussion.  Whether I had actually made it clear in my talk, I actually doubt, though I had had it in my largely ignored notes, we got onto the subject of monetary reform.  Most of the libertarians in the room including myself excoriate the current system of central banking and fiat debt based money.  For the Individualist Anarchists and Mutualists the state protected monopoly of credit creation is one of or probably the single biggest system of privilege which enables the owners of capital to exploit labour and creates enormous barriers to entry.

Yet twice now in two months (the other was on New Year's Eve) I have got into heated arguments with Lib Dems about the need, or as I see it lack of a need, for a state system of currency.  They seem to see it as an absolutely essential function of the state, the only thing that guarantees honesty in trade, in banking (sic!), in knowing what values we assign to things and so on.  Of course one problem with challenging such an accepted social custom as state backed money, is presenting an alternative defenders of the status quo understand, and one of our problems as libertarians is that we don't, naturally, present a single one.  

Many of course prefer some kind of precious metal backed currency - that poses problems in that people often do not understand how as economies grow they can be "valued" if there's only a fixed amount of the glittery stuff against which to value them.  The answer seem to be roughly that rather than prices always rising because of inflation of the money supply, the same amount of precious metal money buys more.  Money, remember, is not wealth.  The goods you buy with it are wealth, and just because you pay less in tokens for something does not mean you are any the less acquiring wealth.

I probably make life even more difficult for myself, because I do not favour an explicitly "specie" based currency system - I prefer a completely open market in currencies.  What today we call banks, but probably other sorts of organisations as well, issue their own currencies which compete in the market for customers to use them and businesses to accept them.  They are, ostensibly, kept "honest" because they have sole responsibility for the value of their issue and the market will react quite quickly in devaluing that of an issuer who, for example, has made irresponsible loans and has therefore less certainty of the value of the assets underpinning its currency.  In such a free market it may well be that specie backed private currencies will become the most favoured.  I suspect personally that this will only be the case for certain types of trade, and that people will soon learn to accept lots of different kinds of money depending on the level of guarantee of its value over the period they anticipate holding it they feel they need.

So, for example, in very local trades, a local currency backed mostly by your own assessment of the trustworthiness of the people within whose network it circulates may be sufficient.  In this era of rapid global communications where we may also form non-geographic communities, perhaps but not necessarily linked together by some other interest (such as is happening in some online gaming systems now), this level of trust may be sufficient.  But for more valuable trades, perhaps ones with distant counterparties of whose providence and trustworthiness you may be uncertain, you may want to use a currency that carries a better intrinsic guarantee, such as a specie backed one from a major issuer.

But the point is that money, the notion of money, is a really flexible thing and the idea of having some commonly agreed upon medium in which transactions are carried out is probably one of the most obvious examples of human society inventing things as the need arose, and definitely not waiting for states to come along to introduce it.  And the current system, that puts in the hands of a very few people the ability to determine if you like who gets how much of it and at what cost, how much of it exists at all, and issues it as debt, instead of as credit, must surely be one of the worst imaginable.

If you think the central banking system is an essential function of the state to protect the weakest against economic predation by the unscrupulous, you just need to look at the sort of people who demanded this system be created in the first place.  Do you really think that the Federal Reserve system in the US was the brainchild of the two richest men then, or proportionately, since with the intention that it benefit us?  Or that anyone other than William Paterson and his business associates were intended to benefit from the founding of the Bank of England?

At this time of financial turmoil, too few people understand the origins and nature of banking.  Or the amount of control that governments actually do have, in spite of all the claims of "deregulation" of the financial sector, in manipulating the money supply, usually, admittedly, covertly through their friends in the private banking system.  Whilst I am not a "gold bug" I do at least believe that the current system of money perpetrates the biggest imaginable fraud against ordinary people and businesses at the hands of the people we allow to be elected to "serve" us.

Those who have inherited the British Liberal tradition should understand this better than most.  Many connected directly or indirectly with that movement over the past hundred or so years in particular have been prominent skeptics about the debt-based fiat money system.  Why do they now seem to cling so tightly to the myth that our money system is something that keeps either the state or the bankers honest and favours us little people?

Those of us who do see through it may offer wildly different alternatives, but surely the mere fact that so many people do seek alternatives suggests that there might, just, be something questionable about it?

Even many who are relatively sympathetic to free market minarchist and mutualist ideals where as much as possible is done through voluntary rather than coercive statist mechanisms often have a problem envisaging a system in which no state apparatus exists.  Two of the most common objections are that we at least need a state to administer "justice" and to ensure "national defense".  Even intellectual heavyweights such as Robert Nozick felt that a de facto "state", at least at a local level, would emerge from private law enforcement agencies.

So I'm often on the lookout for literature that explains how a private law based society would work, indeed would vastly improve upon the current predominant state run model, and so I am delighted to point my reader to "Chaos Theory", a pair of short essays, one on "justice" and the other on "national defense" by Robert P Murphy.  It is available as a freely downloadable PDF at the Mises.org site.  You can also buy a dead tree version (though I find delivery costs too high at Mises.org to justify having these sent to the UK).

It also provides further illustration of the point I was making in my previous piece on how respect for private property and contracts frees us from the need for a state.

I have also prepared an MP3 audiobook version, which is attached to this post.  It's mainly just for me to listen to again on the way to work, but if you'd prefer to listen than to read, and can face my dulcet tones, feel free to use it, Robert Murphy has given his permission.  It's only an hour and a half long, so you can judge how long it will take you to read this very accessible introduction to some of the ideas involved.

Particularly on the "justice" side, I can see ways in which the Mutualist ideal of creating such institutions and mechanisms within the current system could be successful.  Since the non-aggression principle would not rely on the same ability conferred on state agents (i.e. the police) to arrest someone, there is no reason why such mechanisms could not operate successfully on private property at present.

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Now lots of people baulk at a perceived notion that libertarianism is fixated on private property.  They feel that it is indicative of an incessant right wing-ish obsession with accumulation of wealth and devil take the hind-most (who will, obviously, they assume, have no such private property: wrongly of course - for we want everyone to be able to accumulate enough property to enable them to gain financial security and so on).

In fact of course the statement in the title, "property is freedom", comes from Pierre-Joseph Proudhon, with whom most people associate a. anarchism (which many seem to think of as somehow not "right wing-ish" - if libertarianism is "right wing-ish" - which it is not but never mind; I don't want to get into a left-right debate here), and b. the more famous dictum that "property is theft".

And it struck me the other day, while listening again to Murray Rothbard's "For a New Liberty" (of which you can listen to an excellent free audiobook version in individual chapters at the Mises Institute), that actually the really important thing about property and why it occupies such an important place in libertarian is little to do with material wealth accumulation.

Actually it's two big reasons, the first of which I don't really want to get into here - that private property, as opposed to communal property in particular, creates the right sort of economic incentives for individuals to want to work to support themselves and keep their property in good order - if they get to keep the product of their efforts, the property which results, they are incentivised to do well. 

But it is the second big reason that I want to highlight now in the context of "property is freedom":  respect for private property rights and the voluntary contracts that give rise to them is key to eradicating the state's (often contradictory) interference through legislation.

Take, for example, the right to free speech.  A right in theory at least at the very root of liberalism - for if you cannot be free with your thoughts, and with expressing them in speech or publication, is not the state constraining your very being?  But we've all heard, and many accept, the idea that there must be some kind of "limit" on free speech, such as not being allowed to yell "Fire!" in a crowded theatre because of the harm that may cause to panicking patrons.  Well, libertarians do not need such a contradictory limitation; because of our respect for property and contract.

To yell "Fire!" in that crowded theatre is a breach of contract of the basis and conditions on which you and the other patrons are permitted in that theatre by the owner - to watch a performance.  Any harm caused by your actions will either be breaches of their contracts, or damage to their property, and properly actionable through private actions on their behalf.

By the way, you can hear more about the "Person who yells "Fire!" in a crowded theatre" from Walter Block's book, "Defending the Undefendable", also at the Mises Institute.

Many think that anarchy means a complete lack of order, or a lawless world in which the vulnerable for whatever reason will be preyed upon by all those vicious racists, homophobes or whomever that we have created many dubious restrictions on free speech to curtail.  But let's say I own a particular street, I charge my customers for using the street, and they, in turn expect me to provide a safe environment for them to traverse.  So I get to set the rules; the protection agency contracted by my insurance firm makes sure everyone feels safe, ,is not intimidated by racist thugs or whatever.  After all, I may be liable to my customers if they are hurt while in my care, on my property.

Proudhon called all these associations developing civil society "spontaneous order", driven not by what a few people who solicit your votes every so often want, but by you and everyone else going about the myriad of transactions of your every day lives.

Oh, and while I'm at it, I'd probably want to make sure my street was gritted and safe for my customers in the snow too, maybe even get a few more customers if other street owners didn't bother so much.  I can't say my local authority is a "customer focused street owner" at the moment, can you?  It is because of respect for property and contract that all this can happen and, just as important when compared with the state's way of doing things, that the money flows to the services that people actually need, because, well, they're paying for it and can demand what they've paid for.

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I'm cold. There's no doubt about it, it is cold. But that's no good reason to deny what seemingly everyone else is saying - that it's getting warmer, and dangerously so - is it? But the fact is, I'm not a climate scientist; I suspect if I were I would probably be little the wiser. But since I'm not, I do not have the evidence to say whether they are right or wrong on global warming: is it different this time from previous warming or cooling events; if it is, is it man-made; can we stop it; should we stop it; what happens if we don't. Clearly a few scientists in one of the world's newest sciences has made the case, and we're all, or nearly all at least, listening, and scared. And yes, we want to do something about it, well, lots of us anyway.

However, watching the very few snippets of news coverage from Copenhagen I have seen just makes me realise how wrong headed all this is. It's just like that G8 lot that turns my stomach so. Look, if such a great proportion of people have voted to elect people around the world on the basis of their promises to do something about climate change, if global warming and the environment more generally are so high on peoples' priorities, why on earth, in the name of all that is holy, do they think politicians and state, or supra-state, action is going to do anything about it.

Look, it is the state that has got us into this problem of anthropogenic global warming, if that's really what is going on. As any good mutualist will tell you, exploitation is only possible when the owners of capital and the appropriators of natural scarce commodities harness the power of the state in the defence of their interests. That goes for the exploitation of labour, just as much as the ability to externalise costs.

Everyone moans that libertarianism scarcely has anything to say about the environment. and it often seems that way, and even when it does its primary response is to talk about privatising the "commons" so that owners have a clear interest and a clear responsibility for the bits of it they use and if they abuse that in such a way as affects others' parts of it they can be held accountable. But I've now realised that that answer is merely touching on the symptoms, not the problem itself. And the problem is that it is the state that has created the very circumstances in which not only does such exploitation thrive, but that it is actually necessary just for economic actors to be able to deal with the economic disaster that is state "management" of macro-economic factors.

It is the state that fails, time and time again, to maintain a stable currency, resulting in great tsunamis of inflation against which producers have to swim just to stand still. It is the state that takes so much of its constituent economic actors' production that they have to double, literally, their production in order to turn an ordinary profit. And it is states that have given away huge swathes of "the commons" for virtually nothing, at the behest of the corporations who can best afford to persuade them to do so, without those corporations having to put a real value on those goods and account for them properly.

And all you folk think that states, even states working together - or herding cats as it is known - can put an end to all the environmentally destructive consequences of their previous folly? Utter codswallop. States can no more switch off the economic treadmill they have created and on which we must all run ever faster, unsustainably faster, than their leaderships appear to understand how it got started - for it is that treadmill that powers those same states, and their leaderships.

The power we need to learn to stop using, stop wasting, is that state power, which is so dependent on unsustainable economic activity to keep itself alive. It is not too late: people may claim that we have "reached the tipping point" and that things are now moving so fast that even if the real answer was once more "human scale production" and such mutualist niceties that would have meant we would have never got so far towards destroying the planet it's gone so far we need to reverse it, not merely slow down. But it's none of the sort - pull the plug on all the state protection of capital and we'd very quickly be able to shift our productive and innovative capacities into things other than the "thneeds" that economies (especially developing ones but certainly not exclusively) chuck out in unsustainable quantities because they are an easy way to maintain one's place on the treadmill.

No, I'm not a "climate change denier" - I just...don't...know. But what I am is deeply sceptical of "movements" demanding we all have to do this or that, especially when the thinly veiled, and at times over the last week or so not so veiled as the world-wide movement has become more and more shrill in its demands, calls are for some kind of world government action. If we, as individuals, really put this issue right there at the top of our concerns, then we, as individuals, will find ways, spontaneously, in a genuinely free market, one in which the actors cannot exploit either labour or nature because there can be no government to assist them in that, to respond to our demands.

And what I am sure about is that more state action is not the answer. It is that which got us to this point, and it is not that which will get us out of it, even if they can agree on anything meaningful. "Light Greens" know all this - inherently anarchist of the "human scale technology" school, brothers and sisters of mutualism and sensible liberal economics. But we are in the grip of the "Dark Greens" who appear to be nothing of the kind - a bunch of authoritarian crypto-communists who crave nothing more than some kind of world power pushing their message and the "initiatives" we will have to take to respond to that message. Let us not forget that it was and indeed is the most state controlled economies whose labour was forcibly cheap that belched out commons destroying pollution in unmatched quantities whilst doing absolutely nothing for the overall wealth of their citizens. Do we want to return to that sort of poverty - I suspect some would like us to, though they won't say so, because they know the prospect of their Green Dark Age is not one that will win them favours. They must not be given the opportunity to force us to do so.

All the emails, all the messages I've received over the last month, from demanding I get involved in something called "The Wave" to the endless e-mails from Avaaz and their likes claiming that our incompetent fool of a Prime Minister asked them to organise a world wide demo to show support for their negotiating position, have but created a movement feeding the ego-mania of a few individuals who see opportunities for themselves in global mandated action. They could have been used to create genuine democracy, operating through free markets, to create demand for the sort of innovations we will need if this "crisis" if that is what it is, is to be solved.

In the run up to 1997, I remember that one somewhat better, the Iron Lady was gone, love her or hate her, and the Tory government had become mired in "sleaze" and policy-wise had run out of steam, full of the second division of ministers that had emerged under Thatcher. Tony Blair and his New Labour project was another "Big Idea" whose time had come. Labour without the socialism. Economically responsible. With a plan.

And so we've had Thatcherism and Blairism over that past thirty years. But I think we will not get Brownism or Cameronism. Now, even moreso than in 1979, and certainly moreso than in 1997, we need a "Big Idea". Not merely a change of management. And, for all the coverage, I cannot see any "Big Idea" coming out of Old Queen Street. To prove their management credentials, they present, at their big show case conference before likely victory, a managerial mock-budget. Talk of freezing public sector pay, of everyone working for an extra year before retirement; these are not going to solve the terminal systemic problems in the anglo-saxon pensions system or the bloated state, unable to sap any more out of a shattered and second class productive economy.

And today's "Big Idea" ought to be not looking at how the State can be tweaked here and there or managed differently, but to look at the very nature of the State itself. As I quoted Albert Jay Nock in me previous post, here he is again, also from "Our Enemy The State":

The condition of public affairs in all countries, notably in our own, has done more than bring under review the mere current practice of politics, the character and quality of representative politicians, and the relative merits of this-or- that form or mode of government. It has served to suggest attention to the one institution whereof all these forms or modes are but the several, and, from the theoretical point of view, indifferent, manifestations. It suggests that finality does not lie with consideration of species, but of genus; it does not lie with consideration of the characteristic marks that differentiate the republican State, monocratic State, constitutional, collectivist, totalitarian, itlerian, Bolshevist, what you will. It lies with consideration of the State itself.

[...]

It appears to me that with the depletion of social power going on at the rate it is, the State-citizen should look very closely into the essential nature of the institution that is bringing it about. He should ask himself whether he has a theory of the State, and if so, whether he can assure himself that history supports it. He will not find this a matter that can be settled off-hand; it needs a good deal of investigation, and a stiff exercise of reflective thought. He should ask, in the first place, how the State originated, and why; it must have come about somehow, and for some purpose. This seems an extremely easy question to answer, but he will not find it so. Then he should ask what it is that history exhibits continuously as the State’s primary function. Then, whether he finds that “the State” and “government” are strictly synonymous terms; he uses them as such, but are they? Are there any invariable characteristic marks that differentiate the institution of government from the institution of the State? Then finally he should decide whether, by the testimony of history, the State is to be regarded as, in essence, a social or an anti-social institution?

Nock, of course, concludes as I too conclude; that the State is an anti-social institution - the enemy of social power that it unremittingly destroys. And so the "Big Idea" for today is, in fact a "socialist" revolution. A complete reversal of the centuries' old process of State power usurping Social power and never giving it back. Not the "socialism" corrupted by the coercive statist tendencies of the twentieth century "left", or of the "social democratic" tendency. But the confidence that social power can achieve what the do-gooders believe their states can do only much better.

It is an irony that in our own party what we think of and term "social liberalism" reflects a belief that the state should help liberalism flourish by its supposedly judicious interventions. For true "social liberalism" ought to be the belief, expressed by Nock, or Thomas Paine or Thomas Jefferson, Pierre-Joseph Proudhon or Gustav de Molinari that through genuine liberalism social power does not need the coercive state.

As David Boaz puts it in his "Libertarianism: A Primer":

The right term for the advocates of civil society and free markets is arguably socialist. Thomas Paine distinguished between society and government, and the libertarian writer Albert Jay Nock summed up all the things that people do voluntarily--for love or charity or profit--as "social power," which is always being threatened by the encroachment of State power. So we might say that those who advocate social power are socialists, while those who support State power are statists.

State Power is created by conquest and confiscation. From what Paine described as the "French bastard landing with an armed Banditti and establishing himself king of England against the consent of the natives" the state has exploited. It was no less exploitative from the seventeenth century Commonwealth's installation of mercantilist power - merely a different group was exploited. Nor, for all the talk that the universal franchise was the zenith of democratic achievement, has that exploitation ceased just because everyone now has a theoretical say - again, just another group, or groups, exploited from time to time. State power is the true "opium of the masses" with its ability to whisper softly, intoxicatingly to us that "the State will provide".

For those managerial politicians, those would be state exploiters, who cannot get away from their amateur management-speak, what we need is to "zero base" the state. For the state is no defier of the laws of the universe: for every state action there is an automatic and most likely undesirable reaction. It is state created privilege that enables some to exploit others' natural competitiveness in the market. And then the state says it needs to intervene and "redistribute" what would be more naturally distributed if that privilege had not been granted in the first place: more coercion, more exploitation, more state power. Every intervention of the state needs to be examined for the usually detrimental effects it has elsewhere and which it then claims as reason to usurp yet more social power to fix.

And we will find, invariably, that left well alone, without the depredations of the state in the first place, social power would have worked better. Social power, the power of all the associations we make one with another, even the ones we don't know about, such as my relationship with the forger of the brass ferrule in Leonard Read's "Pencil" whom I cannot know, is the only thing that can end this spiral of managerial, coercive, exploitative and ultimately futile statism. And its resurgence needs to start now, before George and Dave, and all that seek to come after them, manage to destroy it utterly. And with our now massively increased ability, through modern technology and communication, to organize for ourselves, for "people [to] have more to do with each other and governments less" there has never been a better time than now.

Socialism: it's not what you think!

I am a "land taxer".

Some people seem to believe one cannot be both. On the one hand, we find people like Lib Dem Matthew Huntbach, who in the comments to this Lib Dem Voice piece on my opposition to the suggested "Mansion Tax" claims that as a self-described libertarian I am likely to drop the idea of land taxes, however much I may talk about them (much more than him I'd wager but there we are) as soon as the opportunity to enrich what he thinks of as my fellow wealthy libertarians allows. For the record, I don't think that I know any truly wealthy libertarians or anarchists, and indeed I know of not a few who, despite being not very well off at all, subsisting on benefits, campaign actively for the destruction of the welfare statist system that seems to sustain them at the moment. On the other hand, we find lots of other libertarians who resolutely refuse to accept even as libertarian those who would appear to want to "confiscate" the value of private property in land they hold as a near sacred element of libertarian thought.

Now I realize that one blog post by an insignificant in Oxford is not going to settle this argument once and for all. Far better economists and political theorists than I have tried. But it is a personal battle for me, because it was the ideas of Henry George that brought me to libertarianism - for his is a libertarian idea, in direct response to the "land question" raised by so many in the history of liberal and anarchist thought - from Locke, Paine, Proudhon, Spencer, Mill, and the individual anarchists Spooner and Tucker. And it is as I have heard, read and hopefully understood more by the likes of the Austrian school market anarchists that my views on George's "single tax" solution have been challenged. Yet I still hold them.

First, a bald statement: I do not believe there are many libertarians of whatever branch or flavour (and we are truly a Baskin-Robbins ideology on that score, whatever the misinformed Lib Dem detractors believe) who do not appreciate that there is an issue of equitable access to land - that which has historically been called the "land question" by many (including Murray Rothbard [pdf] even as he criticized Henry George's solution to it). Sure some place more emphasis on it than others - but I really believe that any who denies there is any issue has not thought terribly deeply about it. I'd go further - that before the early part of the twentieth century it was a touchstone of most or even all of the emerging theories of libertarianism and anarchism; that the four "great monopolies" - of land, of money, of intellectual property and of government - that the individualist anarchists and mutualists described were commonly held to lie at the root of the inequity caused by the statist systems of privilege which they wanted to smash.

It may be that it is merely a difference of emphasis. George, for example, like Proudhon believed that the land monopoly was the "mother of all monopoly" and that solving that, for Georgists as for Proudhon, will tend to render the other three insignificant. When we sat down to discuss the content of the Lib Dems ALTER's recent book "The Case for a New People's Budget" I wanted it to include pieces on the money system and intellectual property but one of the other editors, a better schooled Georgist than I felt that such was completely unnecessary, since solving the land question would solve these others.

On the other side, the Austrians today believe, perhaps, that the fiat state controlled and cartelized money system is at the root of monopolistic behaviour and that sorting that out will render the others nearly insignificant. To this extent, whilst we acknowledge there are other problems, if all we are saying is that sorting this one or that one out first will resolve those others, we are, by different means, aiming at the same ends, of equitable economic distribution of scarce goods.

Others still acknowledge that there is an historical problem - that most land title ultimately and historically descends from aggression or statist privilege - such as monarchs kicking off serfs to give rewards of land to favoured courtiers, or the state sanctioning enclosures without any recompense to those who required the land to maintain life and limb. And they might suggest, as in the excellent introduction to libertarianism by Morris and Linda Tannehill - "The Market for Liberty" (available here as a free audiobook) suggest that at the advent of a truly libertarian society such ancient titles would be revoked since they would be next to impossible to prove and that everyone would have to stake their claims anew. But to me this resolves the problem as a "one off" and not the ongoing problem that land distribution necessarily is given the propensity for populations to change and land requirements with them.

Since it is as a result of hearing Hans-Herman Hoppe on the "Idea of a Private Law Society" nearly a year ago now at last year's Libertarian Alliance Conference that I have become more interested in "full blown" non-state ideas, it is, perhaps naturally, to the Austrian School and in particular the Mises Institute that I have turned to learn more; devouring several years' worth of podcasts of the Mises University series, but also listening to various contributers to the FEE's Freedom University series. And whilst they do indeed talk very little about land, I can glean some of the following with which I find myself in agreement that relates to the "land question" in their thinking:

• If we did not have the corrupting influence of inherently inflationary and statist fiat money there would be much less speculative froth in the system to be ploughed into land values.

• If we did not have state controlled zoning and planning restrictions, more land would be made available as development was needed and land values elsewhere would tend to fall.

• If we did not have state enforceable land titles, we would have to find another mechanism for protecting our rights of ownership of land which would tend to release land that land owners felt was uneconomic to protect compared with the utility they got out of holding it.

• And, I really do appreciate the arguments in favour of the protection of private property (well, I'd rather, after Proudhon, say "possession" than "property") being the mainstay of a civil society, that without which original appropriation and therefore economic production would be all but impossible. And allied to this I feel a sense of unfairness that someone who has, in the Lockean term, "mixed his labour" with "land" and thus brought it into production in the first place, might find that simply because others have later agglomerated around his far-sighted piece of appropriation, he would be subject to paying rent on it that may price him off it.

But...and you knew there would be one...what I cannot get round is the idea that, whilst anarchists anathematize taxation as confiscation of the legitimate product of labour and therefore an attack on Lockean self-ownership, the rental value of land is really a tax on everyone else who cannot use a particular location, even though they may have a more productive capacity to use a particular piece. All of us pay for the monopolization of locations of better quality in terms of our needs, than what we are then forced to settle for. If we have to live further away from work, we pay in time and travel costs to get past those locations that would serve us better. These values feed into land values. It is not merely that land value increment is unearned by the land-owner, but it costs the rest of us in like measure. And it is a huge burden - in the UK it amounts perhaps to about a third of what is the salaries portion of GDP. This effect, whilst it may be smaller if all the other Austrian remedies above were implemented, would never, in my opinion, disappear.

Austrians, of course, reject the value theories on which this hypothesis of land values is based - the labour, or cost theories of Smith, Ricardo and other Classical Economists. They prefer their subjectivist or utilitarian theories based on the work of the likes of Carl Menger and Eugen von Böem-Bawerk. And, whilst I also do not agree with a wholly unmodified labour theory, I am becoming more and more convinced by the likes of Kevin Carson's critique of Menger's and Böem-Bawerk's criticism of the Classical cost theories in his "Studies in Mutualist Political Economy" - which is just as well since I describe myself as a "mutualist"!

On the other hand, I am with the anarchists in that I do not want a government or quasi-government institutional structure to value and collect such "rent". And so I am attracted to ideas such as those of geo-libertarian Dan Sullivan in the US, of how it could be handled by a voluntarist system of community management companies. And it is on his ideas that I think can be developed a system that fits with both the Georgist aims of collecting land rents and the anarchist aims of not having government structures impose taxes on us. In his essay "Are you a Real Libertarian or a Royal Libertarian" he says, toward the end:

Can't we do this without the state?

There are, in fact, proprietary communities operating on the single tax model. Arden, Delaware, with a population of 4900, has had no local taxes since 1900. The Arden Corporation collects a fair market rent on each land parcel, which is reappraised annually. (They actually collect only about a fourth of the rent to which they are entitled.) From that they not only pay for all the municipal services, but rebate all property taxes levied by the county and school district.

There are excellent reasons for libertarians to prefer the land trust route over the political route. Private communities can be built on explicit contracts (leases) with the citizens, can have internal democratic processes that are vastly superior to electoral democracy, can be far more flexible and free of state intervention, and can be downright profitable (even with trust investors pocketing a mere fraction of the rent). Most of all, dealing with investors is far more pleasant and self-affirming than dealing with politicians.

But what worries me about this approach, taken literally at least, is that we might end up with one agency acting as a local monopoly that becomes a de facto government, just like Nozick says that private protection would combine into one agency with a monopoly in an area (though I am yet to read "Anarchy, State and Utopia" - I bought it and promptly lost my copy! - and so haven't read his arguments, I instinctively disagree with this as an inevitable outcome) and be to all intents and purposes a coercive albeit limited government.

However, I think there is a resolution. Admittedly I have not gone into this too deeply as yet. I have not followed all the economic incentives through the processes. It is based on the idea that in a "private law society" (necessarily the case of course in a no-state anarchist system), defense of one's life and property would be handled by competing insurance, protection and arbitration agencies.

In the absence of a single, state-provided, system of land titles, one's ability to hold onto a piece of land (that is, not to fight for, but legally to defend one's right of occupancy against any other claims) would usually be handled by your insurance and protection agencies. Of course, you could opt out, but then you would have to pay for such physical protection and legal protection against claimants by yourself and on a simple division of labour basis it is likely to be more cost effective joining with others via an insurance and protection agency system. But your premiums would likely rise to be something similar to the market rent value of the location - because it is on that basis that other possible claimants would be likely to be basing their claims on. If your insurance agency were a mutual agency operating with profit policies, they would effectively disburse the equivalent of the statist "citizen's dividend" to the members with with-profit policies.

Here, there could be competition. My insurance agency would make a (probably class action on behalf of all their clients inconvenienced by your monopoly holding of land that costs us money to avoid) claim against yours, yours would pay up and that would go into the profits of my insurance firm for distribution to the with-profits members. And these firms could compete across whole areas of productive land. So, for example, you couldn't have only those in expensive locations in Mayfair joining together and insuring against each other and effectively doing so cheaply because you're hardly likely to lay claim to your neighbour's similar property if it's going to cost you money and you're both pretty happy with your lot and are not costing each other anything by your occupancy of neighbouring sites. My firm may be based in Sutton or Dagenham and have most of its clients there, but will still be likely to be making claims against yours.

Eventually it is likely that these individual claims would not be processed at all, but that reciprocal arrangements between these agencies would spread premiums around amongst them such that the dividends paid to each one's clients would tend to even out, but all the same, the claims mechanism would remain available where there were disputes, just as, for land taxers operating within a state system, there would be tribunals to adjudicate on land value disputes.

UPDATE:  I've thought of perhaps a simpler way of understanding this - it might be looked on as competing land registries paying each other premiums for recognizing and upholding each others' clients' titles.  Does that make sense?

As I say - I have not followed the economic incentives right through such a system. But I think it contains the germ of a possible solution that does not rely on confiscatory quasi-state bodies but does equitably distribute the values created by and paid for in other ways by all who need to use land within an agglomeration area.

Remember please, this is a genuine search for a reconciliation between two sets of ideas with which I generally agree but which in contemporary libertarian discourse seem to be all but irreconcilable. But if you've read this far, I'd love to hear your responses.