Tuesday, January 20, 2009


It is presumed, in "respectable discourse", that the "solution" to our present economic crisis is to throw huge wads of government money at it...without altering the fundamental economic system that led to the present state of affairs. This "solution" has become the common assumption amongst both the formerly tight-fisted right as well as the long standing spendthrift left. How well it will succeed is unknown. What is known is that the underlying causes of the crisis will remain to operate another day. Anarchists propose an overhaul of the economic and political system, one that returns power, both economic and political, to the average worker and citizen.

One method towards this goal is to turn enterprises into cooperatives. This stands as a more effective way than corporate bailouts to produce employment in an economic downturn. It is also a localization of the economy, something that would cushion local enterprise against the vagaries of international finance. It is true socialization, free of the bureaucracy and inefficiency of the false socialization of nationalization (which turns an enterprise over to new ruling class of managers).

Here is one anarchist proposal, originally from the pages of Freedom, the world's oldest anarchist paper. It comes to the internet via the LibCom website.
Bailouts or co-operatives?:
As half of a Freedom newspaper feature on responses to the credit crunch, Iain McKay argues for the latter. Read the other half, Co-ops or conflicts?

As capitalism goes into crisis (again), there have been bailouts of the financial sector as well as calls for the bailing out of certain industries. There are many reasons for rejecting this, but the problem is that their workers will be harmed by this. As such, I think it is wise for anarchists to have some practical suggestion on what to do – beyond, of course, calls for social revolution.

May I suggest that in return for any bailouts, the company is turned into a co-operative? This is a libertarian alternative to just throwing money at capitalists or nationalising workplaces.
Proudhon argued in 1848 he

did not want to see the State confiscate the mines, canals and railways; that
would add to monarchy, and more wage slavery. We want the mines, canals,
railways handed over to democratically organised workers' association..”

In his classic work, The General Idea of the Revolution, he made a similar suggestion as part of his critique of capitalism and he influenced the Communards, who turned empty workplaces into co-operatives.

In 1912, Kropotkin argued along similar lines. He noted that the “State phases which we are traversing now seem to be unavoidable.” However, aiding “the Labour Unions to enter into a temporary possession of the industrial concerns” anarchists would provide “an effective means to check the State Nationalisation.” So there is an anarchist tradition of making this kind of demand.

What of the obvious objection, namely that this is not socialism and just “worker capitalism.”
Yes, it is not socialism – but it contains more elements of socialism than the alternatives of bailouts or nationalisation. It is a suggestion that could be applied in the here and now, where a social revolution is currently unlikely. If our position is one of revolutionary purity then it will be unlikely that anyone will pay much attention to us and if a revolt does break out then our influence will be smaller than it could be if we addressed social issues today.

If done in the right way, such activity can be used to get us closer to our immediate aim – a libertarian social movement which uses direct action and solidarity to change society for the better.

What of the notion it is “worker capitalism”? This is confused. It is not capitalist because workers own and control their own means of production. If quoting Engels is not too out of place, the

object of production – to produce commodities – does not import to the
instrument the character of capital” for the “production of commodities is one
of the preconditions for the existence of capital... as long as the producer
sells only what he himself produces, he is not a capitalist; he becomes so only
from the moment he makes use of his instrument to exploit the wage labour of

So workers’ associations are not capitalist, as Marx also made clear.

This is Proudhon’s distinction between property and possession and he placed workers’ associations at the heart of his anarchism, considering them as “a protest against the wage system” and a “denial of the rule of capitalists.” As long as these associations remained democratic (i.e., all people who work there are members) then this is a socialisation of the means of life (albeit, currently within capitalism). The key to understanding socialisation is to remember that it is fundamentally about access, that every one has the same rights to the means of life as everyone else.

This was Proudhon’s position, that “every individual employed in the association... has an undivided share in the property of the company”, has “the right to fill any position, of any grade, in the company, according to the suitability of sex, age, skill, and length of employment” and that “all positions are elective, and the by-laws subject to the approval of the members.” Bakunin was also a firm supporter of cooperatives, as was Kropotkin – although both were clear about their limitations.

This should be the criteria for any bailouts suggested now – the turning of the company into a co-operative which is run by its members and which any new workers are automatically members with the same rights as others.

Of course, it is unlikely that any government will agree to such a socialisation of companies. Unless pressurised from below, they will pick bailouts or (part/full) nationalisation in order to keep capitalism going. If ignored then people should simply socialise their workplaces themselves by occupying and running them directly. Nor should this be limited to simply those firms seeking bailouts. All workplaces in danger of being closed should be occupied – which will hopefully inspire all workers to do the same.

This support for co-operatives should be seen as a practical response to current events, a means of spreading the anarchist message and getting people to act for themselves. At the very least, it helps people who are suffering from the crisis while, at the same time, showing that another world is possible. And it is doubtful that the people whose jobs and communities are on the line because of the decisions of their bosses can make any more of a mess than has already been inflicted on them!

But this is a short-term libertarian solution to the crisis, one that can be used to help create something better. Capitalism has failed. It is time to give economic liberty a go!


As regular readers of this blog may surmise I am definitely in favour of the above, but just for the sake of fairness and counterpoint here is another opinion, once more from the pages of Freedom via the Libcom site.


Co-ops or conflicts?:
As half of a Freedom newspaper feature on responses to the credit crunch, Joseph Kay argues for the latter. Read the other half, Bailouts or co-operatives?

Nationalisation has long been a staple demand of the left, but now that an unprecedented nationalisation of the banking system has failed to lead to socialism, anarchist arguments that state control offers nothing to the working class would appear to have been vindicated.

This creates an opportunity to put forward anarchist ideas not as a critical comment on the left, but as proposals in their own right. Against the demand for nationalisation of troubled firms, many have raised the demand for workers control. This demand is no less problematic, for two reasons.

Firstly, and not insignificantly, we are in no position to demand anything. As a tiny minority in the class, our ‘calls’ for this or that are impotent cries. Nationalisation of the banks didn’t happen because MPs heeded the calls of various Trotskyist groups, but because of a material need to prevent a banking collapse and the consequent economic collapse, falling of profits and danger of social unrest this would entail.

The only way our demands can become a necessity for capital to follow is if they are backed by a class movement capable of imposing them. To call for this or that in the absence of such class power is to get ahead of ourselves; there are more pressing matters at hand. We will return to this in a moment.

The second problem is on a more fundamental level. While many are aware that workers’ control under capitalism is simply self-managed exploitation, the demand is still often raised as a sort of intermediate, ‘realistic’ demand short of revolution. However like nationalisation, workers’ control is not a demand based on our concrete material needs as a class, it is about how capital should be managed.

Capital cannot be managed in our interests, so it is pointless to try. Instead we have to make concrete material demands; no to job losses, wage cuts, public service cuts and evictions; and jumping further ahead of ourselves, for wage increases, shorter hours for no loss of pay, improved public services etc.

Self-managed exploitation is not just a neat turn of phrase, it is a recognition of how capital rules social life. It does this both vertically through the person of the boss, and horizontally, through market forces. Many anarchists focus mainly on the vertical rule of workplace hierarchy, and so see workers’ control as a stepping stone towards libertarian communism.

However, it’s not a stepping stone, but a cul-de-sac. For example, I work in financial services. As you would expect during a financial crisis, we’re feeling the squeeze. There have been redundancies, and the ‘lucky’ survivors are being made to work harder and longer to make up. If we were to turn it into a co-op, those same market forces causing my boss to make cuts would still be there, but we would have nobody to say no too when under pressure to increase the rate of exploitation to survive in a hostile market.

Of course, using the director’s former salaries we might be able to make less redundancies or improve wages. But if the firm has the resources to do this, and we would only be able to create a co-op with sufficiently strong class struggle to force expropriation of the bosses, we should simply demand the concrete material things we want – in this case job security and improved conditions – not demand how capital should be managed to meet our actual needs.

Success in establishing a co-op is success in swapping one form of alienation for another, proletarian for petit-bourgeois. But there is a reason workers are a potentially revolutionary class and small business people are not: class antagonism. When capital makes demands of bosses via market forces, they have to impose them on workers, and workers can resist. Workers’ needs are in direct contradiction to the needs of capital accumulation.

However, if we become our own boss, we have no-one to refuse and the needs of capital appear as the natural imperative of market forces. Class struggle – and with it the potential for revolutionary change – is short-circuited. Ends are made of means, some means get us closer to what we want, others make it more remote and finally destroy its possibility.

So what is a libertarian communist response to the crisis? Communist demands are concrete, material demands reflecting our needs as workers. To be in a position to make these demands, we need to have a level of working class power and confidence that is presently lacking. Therefore our activity should be aimed at increasing the confidence, power and combativity of the wider class.

The Tea Break workers’ bulletin is one such project to this end, it advocates libertarian communist tactics to achieve concrete material gains. These tactics are the advocacy of collective action, for militant workers to network with one another online or face to face, for mass meetings including all workers regardless of union membership to control the struggle (excluding managers and scabs of course), and for links to be made between workers divided by workplace, sector, union, agency/permanent contracts and the manifold other divisions currently present (nationality, gender…).

As a concrete project aimed at spreading libertarian communist tactics and demands and increasing the power and confidence of the class, it is at least a small but definite step in the right direction.



As I said above I definitely favour the tactics laid out in the first essay above. That being said there are a few obvious points to be made.
1)The author of the second essay is probably aware that quite often his "concrete demands" are just as unrealistic as the demand for a worker cooperative in a certain enterprise. They are even more so in the unfortunately all to frequent occurrence where a company is determined to shut a facility down out of economic necessity- something that does occur. Actually it is quite common.
2)There is no either/or to this matter. Mutualists, who are the greatest supporters of producers' co-ops, may also (Almost always are actually) be in favour of militant union demands in most labour/management conflicts. The goal of eventually converting an enterprise to a self-managed one does not exclude ordinary union tactics to win the best deal possible for the members in a given situation. Mutualists would hardly disagree with such militancy. It's just that they wouldn't see it as sufficient in itself.
3)Which brings us to the fact that the "alternative" offered by the author of the second essay lacks even the slightest suggestion of how demands for "more and more" translate into a social transformation. This is the same sort of "alternative" as was offered by the AFL in its founding years as an "alternative" to the demands of more radical labour associations. It's all well and good to say that pressure should be applied to make any demands put forward by labour as demanding as possible. It's quite another to claim that this is some sort of thing that will automatically translate into some "alternative to capitalism".
Maybe such a social transformation is an unachievable goal. The followers of J. W. Machajski's "Workers Conspiracy" certainly argued something very close to this over a century ago. This political trend, however, was as hostile to the "revolutionaries" as the AFL was, and saw them much more clearly as an aspiring ruling class. Maybe the truth lies in between the confidence of the revolutionaries and the skepticism of those who see the power hunger in their eyes. Maybe steps toward such a transformation are the best way to proceed, allowing things to be worked out in practice where ideological plans fall short.
4) I do notice that the author of the second essay berates the first for putting forth "demands" that have to be "backed by a class movement capable of imposing them". In a quite honest admission later in the essay he says that for his "concrete demands" to be realized "we need a level of working class power and confidence that is presently lacking". In other words the "concrete demands" are just as utopian.
5)Then we come to the real crux of the matter. What exactly is the nature of the proposed post-capitalist society ? Will it have no market section of the economy ? If it will what exactly is the difference between moving towards such a way of managing enterprises now and waiting for the Second Coming to make it happen ? If it will not is there some sort of magical solution to the problem of the distribution of both effort and reward that will fit all possible cases of all labour and goods in the free society ? What are its benefits and costs ? Once anarchism becomes a mature ideology it will inevitably have to approach the weighing of advantages and disadvantages in a realistic rather than adversarial manner.
6)No doubt the gradual "cooperativization" of a society involves problems. to my mind, however, these problems are exceedingly minor compared to hoping against hope that a blissful libertarian alternative will emerge from simply advocating a strategy of combativeness. Other outcomes are far more likely in such a situation, and permanent irrelevancy may actually be the least unpleasant of the selection.


Larry Gambone said...

The second option is in reality an option to do nothing at all. It is either full communism or nothing. Well, comrades hope you enjoy an eternity of capitalism! And as you point out, the likelyhood of the deus ex machina of revolutionary class struggle that somehow erupts, avoids naughty half way measures like worker coops, and goes straight on pure communism is nil. Marx himself would have a fit over option 2!

Larry Gambone said...

I forgot to mention that according to the Great Squeaker, Mousey Tongue, option 2 is "left in form, right in content."