Monday, February 28, 2005

Mutually Assured Competition

Right, I might as well start talking about some of my new links.

Kevin Carson - mutualist, Prodhounist (it seems) certainly and market individualist. Excellent. Now, I think that a lot of the spirit and values he seems to embody seem interesting, and I think that it's worth pointing out that Marx hated Prodhoun so much partly because they were fishing in the same teritory - i.e. that their values weren't that far apart, but their plans were.

In Contract Feudalism Carson sets out a mutualist position:
Contrast this monstrous state of affairs with what would exist in a genuine free market: jobs competing for workers instead of the other way around.

Instead of workers living in fear that bosses might discover something "bad" about them (like the fact that they have publicly spoken their minds in the past, like free men and women), bosses would live in fear that workers would think badly enough of them to take their labor elsewhere. Instead of workers being so desperate to hold onto a job as to allow their private lives to be regulated as an extension of work, management would be so desperate to hold onto workers as to change conditions on the job to suit them. Instead of workers taking more and more indignities to avoid bankruptcy and homelessness, bosses would give up more and more control over the workplace to retain a workforce.
One might even ask why they would bother - and possibly they wouldn't, and so this should lead to Co-operatives.

But, problem. Uncle Charlie Marx established a little principle - that price and value don't necessarilly coincide. Where conditions are correct, value can be transfered from one hand to another at a price below it. We can see this in an industry where one firm may have better access to transport, to natural resources, etc. which can produce goods below the market price but still sell at or just below the going market price of their good, to make an excess profit.

Obviously, unless these advantages can be monopolised, other firms would note the excess profits, and invest in the advantaged firm (or in their own to increasse their efficiency and thus draw level again). The same is true across branches of industry.

The net effect is that less labour intensive industries will tend to suck up value from more labour intensive industries. Typically, farming (hugely labour intensive) transfers a great deal of value to high-tech industry. Profit rates are equalised across the economy.

This would still happen under mutualism, more productive/efficient co-ops would soak up value, would have transfers from competitors, who would then be faced with having to decide whether to let people go (voluntarilly, of course) in order to compete.

What this means, is that you can have a capitalism without capitalists. You can have all the profit seeking behaviours, without the personal gains for any real sensuous human being. Paul Mattick concieved the central dialectical contradiction of capitalism as between use and exchange value. Put another way, between investment and consumnption. Capitalism exists to create more exchange value and more capital. If we remove the share going to the luxury life-styles of the capitalists, we could still find ourselves being squeezed to the bone as we deliver up the value to King Capital itself, like some dark Aztec god.

So, mutualism is not an alternative to capitalism, it is capitalism without the capitalists. That may be an improvement, but I wouldn't prefer it over socialism.


Anonymous Anonymous said...

"You can have all the profit seeking behaviours, without the personal gains for any real sensuous human being."

Why then, would anyone indulge in 'profit seeking behaviours' unless there was something in it for them? Why go to the bother of innovating? Why trouble yourself with cost-cutting? What's the point in chasing efficiency? Why save?

4:32 PM  
Blogger Bill said...

Fear. Mostly. The differences in competiveness between co-operatives would mean that some would face extinction if they did not innovate and adapt.

Plus, there would be real - albeit temporary - benefits for competetive work[places (i.e. shorter hours or more money per head). This would be lost, though, in a gradual transfer over to needing more capital investment to stay in the game.

Anyway, it's a theoretical scenario, not an empirical one, it's highly unlikely to happen, but possible.

4:48 PM  
Anonymous Anonymous said...

"'s a theoretical scenario, not an empirical one, it's highly unlikely to happen.."

You can say that again! But I'm still confused. If a particular producer innovated and gained extra profit, who or what would stop him expanding? And if it is some sort of authority, then I come back to my original question, why would the producer bother to innovate in the first place?

7:11 PM  
Blogger John said...

comments are superfluous

8:10 PM  
Blogger Bill said...


well, in a mutualist society, nothing. This is my point, it is still capitalism. It may not have any personal capitalists, but it is still capitalism.
In socialism, innovation would be driven by the desire to make work easier or more pleasant, or to ensure that more people could enjoy more goods. We would not need a central authority to prevent profit seeking, because without money or legal title to property in means of production, or exchange of goods/services it would simply be impossible.

10:34 AM  
Anonymous Anonymous said...

You wrote: "We would not need a central authority to prevent profit seeking, because without money or legal title to property in means of production, or exchange of goods/services it would simply be impossible."

Now I'm curious, and I am definitely *not* trolling. Without money, how would you support and 'pay for' (I can't think of another word), say, the labs necessary to find a cure for cancer?

9:59 PM  
Blogger Bill said...

Well, we would:
1)Democratically, as a community, decide that we needed research facilities, and that we needed a cure for cancer.
2)Cancer research volunteers would assemble, and decide what facilities they would need to adequately investigate the problem.
3) They would then send orders to suppliers, who would use access to the common store of goods to produce the necessary goods on demand.

11:32 AM  
Anonymous Anonymous said...

"..we would Democratically, as a community, decide.." I don't want to stray off the economics but I wonder what a "community" consists of.

Obviously, a medical research unit will require an enormous amount of glass products, petri dishes, test tubes, etc. Let us suppose, theoretically, that there are, say, five glass producers and you now require them to increase production, ie, work harder. Why should they?

10:32 PM  
Blogger Bill said...


well, a community is up to everyone and down to the people who are interested (i.e. directly concerned or motivated) so will vary from instance to instance. Generally, the scale of the project would out in terms of how wide you'd need to consult to act.

As for motive of glass makers, presumably they agreed to the plan to have cancer research, feel producing for it is worthwhile, and like making high quality glass/perspex products.

They benefit from having their free access to a share of the common store of goods...

8:15 AM  

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