Why I am Not a Libertarian

Mr Médaille explains why he is not a libertarian mutualist.

By John Médaille

Kevin Carson has made an excellent case for the connection between Libertarianism and distributism. (Of course, I do not mean here the caricature of libertarianism that has predominated since Ludwig von Mises; that kind of libertarianism is simply silly.) Nevertheless, I do have some critiques which keep me from being a whole-hearted libertarian.

The first criticism I would offer has to do with the efficacy of the pure price system. Libertarians tend to believe that all externalities are the result of govmint action. (Externalities are the costs of a transaction not borne by the parties to the transaction, but placed on some third party who is not involved. Pollution is an example of an externality.) Yet I question that assumption. One can easily undercut the market by, say, developing a cheaper manufacturing process which merely dumps the hazardous wastes into the nearest stream, causing hardship for those down river. There is no reason, that I can see, to assume that such externalities are impossible without government, and many reasons to believe that the absence of a public authority will encourage such externalizing. Indeed, without monitoring, how is anybody to know that it is happening? And if monitored, how is anybody to put a stop to it without some sort of government? Now, I am a believer in market pricing, but I am not a believer in the theory that the market price encodes all information about a product. As long as their are externalities, or even the possibility of such, will there not be required a political process (call what you will) to arbitrate the externals and assign costs? But such a function turns out to be complex and hence problematic in terms of Libertarian anarchism.

The second critique is the absence of distributive justice. Mutualism, as Kevin presents it (and I may be wrong here) relies (as does neoclassical economics) on corrective justice only, on free contract. But contracts arbitrate power, not productivity, not a contribution to the productive process. That is the whole reason that the formulas of marginal productivity do not work: they marginalize not productivity but power. Any glance at the difference in pay scales between the CEO and the line worker, between the sweatshop seamstress and the owner confirm that power is the key, not productivity. earns 500 times more than the line worker not because he is 500 times more productive but because he is 500 times more powerful; the seamstress in a sweatshop will be given a pittance not because she lacks productivity but because she lacks power. A glance at the statistics on the increase in productivity compared to the flatness of the typical wage shows the same thing. A contractual system, apart from a prior notion of distributive justice, will end in power being arbitrated, for that is what contracts do. Now, you can reasonably reply that a notion of distributive justice is satisfied by usufruct of land, and that will be true to a large extent, but not completely, because land is not the only factor of production. There will be many opportunities to cheat, which brings me to the next critique: you have not accounted for sin.

I am not so dogmatic as to insist on a notion of sin in a theological sense, but I think we can all agree that people have a tendency to try and profit at the expense of others, a desire to earn a surplus profit. Oddly enough, this is not really a desire for gain in terms of money, but in terms of power. For it is easy to show that everyone would be better off in an economic sense in a mutualist system. However, economic betterment is not the issue; power is. The pure joy of being able to lord it over your neighbor holds an irresistible attraction for at least some people, and maybe more than we think.

All of these things are problematic, are they not, for anarchism. Men have always had govmints not because of flawed thinking, but because of practical problems. The community has a role in all these affairs for all of these reasons, but a freely contracting society would have difficulty in handling them, would it not, because they cannot be subsumed under contract. Therefore, corrective justice alone is insufficient, and economics must also be political economy.

Which brings me to by last critique, and that is that contract, social or otherwise, does not exhaust the nature of man; it is too individualistic, while man is social. We are called into being by the ready-made community of family, and we receive a series of gifts which are purely social in nature and not exchangeable: language, nationality, custom, moral sense, etc., are all gifts outside the exchange system and cannot be accounted for by that system. Yet the exchange system relies on them and cannot exist without them. Therefore, a better description is needed.

Having said all that, I do not wish to over-emphasize the critique; I do not wish to make distributivism and mutualism mutually incompatible, for they are largely variations on a theme, a theme of freedom. But I think it useful to point out that the vulgar libertarians, when they defend pure corporations and even monopolies (as they do), are not as inconsistent as some might think them. If free contract is all, then a group may freely contract to oppress or gain some non-market advantage. If absence of govmint interference is the only standard (and anarchism lends itself to that interpretation) then there can be no govmint or even community to put a stop to it. We begin (and end) in non-contractual communities, and this fact about humans, this social fact, has to be accounted for in the social systems, and economics is certainly a social system.

The Distributist Review