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Mutualism is an anarchist school of thought and economic theory that advocates a socialist society based on free markets and usufructs, i.e. occupation and use property norms. One implementation of this system involves the establishment of a mutual-credit bank that would lend to producers at a minimal interest rate, just high enough to cover administration. Mutualism is based on a version of the labor theory of value
that it uses as its basis for determining economic value. According to
mutualist theory, when a worker sells the product of their labor, they
ought to receive money, goods, or services in exchange that are equal in
economic value, embodying "the amount of labor necessary to produce an
article of exactly similar and equal utility". The product of the worker's labour factors the amount of both mental and physical labour into the price of their product.
While mutualism was popularized by the writings of anarchist philosopher Pierre-Joseph Proudhon and is mainly associated as an anarchist school of thought and with libertarian socialism, its origins as a type of socialism go back to the 18th-century labour movement in Britain first, then France and finally to the working-class Chartist movement. Mutualists oppose individuals receiving income through loans, investments and rent under capitalist social relations.
Although opposed to this type of income, Proudhon expressed that he had
never intended "to forbid or suppress, by sovereign decree, ground rent
and interest on capital. I think that all these manifestations of human
activity should remain free and voluntary for all: I ask for them no
modifications, restrictions or suppressions, other than those which
result naturally and of necessity from the universalization of the
principle of reciprocity which I propose." As long as they ensure the worker's right to the full product of their labour, mutualists support markets and property in the product of labour, differentiating between capitalist private property (productive property) and personal property (private property).
Mutualists argue for conditional titles to land, whose ownership is
legitimate only so long as it remains in use or occupation (which
Proudhon called possession), a type of private property with strong
abandonment criteria. This contrasts with the capitalist non-proviso labour theory of property, where an owner maintains a property title more or less until one decides to give or sell it.
As libertarian socialists, mutualists distinguish their market socialism from state socialism and do not advocate state ownership over the means of production.
Instead, each person possesses a means of production, either
individually or collectively, with trade representing equivalent amounts
of labour in the free market. Benjamin Tucker
wrote of Proudhon that "though opposed to socializing the ownership of
capital, he aimed nevertheless to socialize its effects by making its
use beneficial to all instead of a means of impoverishing the many to
enrich the few ... by subjecting capital to the natural law of
competition, thus bringing the price of its own use down to cost".
Although similar to the economic doctrines of the 19th-century American
individualist anarchists, mutualism favours large industries. Mutualism has been retrospectively characterized sometimes as being a form of individualist anarchism and ideologically situated between individualist and collectivist forms of anarchism. Proudhon described the liberty he pursued as "the synthesis of communism and property". Some consider mutualism part of free-market anarchism, individualist anarchism and market-oriented left-libertarianism, while others regard it as part of social anarchism.
History
Origins
As a term, mutualism has seen a variety of related uses. Charles Fourier first used the French term mutualisme in 1822, although the reference was not to an economic system. The first use of the noun mutualist was in the New-Harmony Gazette by an American Owenite in 1826. In the early 1830s, a French labour organization in Lyons called themselves the Mutuellists. In What Is Mutualism?, the American mutualist Clarence Lee Swartz defined it this way:
A social system based on equal freedom, reciprocity, and
the sovereignty of the individual over himself, his affairs and his
products; realized through individual initiative, free contract,
cooperation, competition and voluntary association for defense against
the invasive and for the protection of life, liberty and property of the
non-invasive.
In general, mutualism can be considered the original anarchy since the mutualist Pierre-Joseph Proudhon was the first person to identify himself as an anarchist. Although mutualism is generally associated with anarchism, it is not necessarily anarchist. According to William Batchelder Greene
did not become a "full-fledged anarchist" until the last decade of his
life, but his writings show that by 1850 he had articulated a Christian
mutualism, drawing heavily on the writings of Proudhon's
sometimes-antagonist Pierre Leroux. The Christian mutualist form or anarchist branch of distributism and the works of distributists such as Dorothy Day and the Catholic Worker Movement can be considered a form of mutualism, or free-market libertarian socialism, due to their opposition to both state capitalism and state socialism. According to A Mutualist FAQ,
mutualism was "the original form taken by the labor movement, first in
Great Britain and shortly thereafter in France and the rest of Western
Europe. Both mutualist practice and theory arose as part of the broad
current of working class radicalism in England, from around the time of
the publication of Paine's Rights of Man and the organization of
the first Societies of Correspondence in the 1790s, to the Chartist
movement. Mutualism existed for some time as a spontaneous working class
practice before it was formalized in theory."
Proudhon was involved with the Lyons mutualists and later adopted the name to describe his teachings. In What Is Mutualism?, Swartz gives his account of the origin of the term, claiming that "[t]he word 'mutualism' seems to have been first used by John Gray, an English writer, in 1832". When Gray's 1825 Lecture on Human Happiness was first published in the United States in 1826, the publishers appended the Preamble and Constitution of the Friendly Association for Mutual Interests, Located at Valley Forge. 1826 also saw the publication of the Constitution of the Friendly Association for Mutual Interests at Kendal, Ohio. Of Proudhon's philosophy, Geoffrey Ostergaard
summarized, "he argued that working men should emancipate themselves,
not by political but by economic means, through the voluntary
organization of their own labour—a concept to which he attached
redemptive value. His proposed system of equitable exchange between
self-governing producers, organized individually or in association and
financed by free credit, was called 'mutualism'. The units of the
radically decentralized and pluralistic social order that he envisaged
were to be linked at all levels by applying 'the federal principle.'"
The authors of A Mutualist FAQ quote E. P. Thompson's
description of the early working-class movement as mutualism. Thompson
argued that it was "powerfully shaped by the sensibilities of urban
artisans and weavers who combined a 'sense of lost independence' with
'memories of their golden age.' The weavers in particular carried a
strong communitarian and egalitarian sensibility, basing their
radicalism, 'whether voiced in Owenite or biblical language,' on
'essential rights and elementary notions of human fellowship and
conduct.'"
Thompson further wrote: "It was as a whole community that they demanded
betterment, and utopian notions of redesigning society anew at a
stroke—Owenite communities, the universal general strike, the Chartist
Land Plan—swept through them like fire on the common. But essentially
the dream which arose in many different forms was the same—a community
of independent small producers, exchanging their products without the
distortions of masters and middlemen."
Mutualist anti-capitalism originates in the Jacobin-influenced
radicalism of the 1790s, which saw exploitation mainly in taxation and
feudal landlordism in that "government appears as court parasitism:
taxes are a form of robbery, for pensioners and for wars of conquest." In Constantin François de Chassebœuf, comte de Volney's Ruins of Empire,
the nation was divided between those who "by useful laborus contribute
to the support and maintenance of society" and "the parasites who lived
off them", namely "none but priests, courtiers, public accountants,
commanders of troops, in short, the civil, military, or religious agents
of government." This was summarized by the following statement:
People.... What labour do you perform in the society?
Privileged Class. None: we are not made to labour.
People. How then have you acquired your wealth?
Privileged Class. By taking the pains to govern you.
People.
To govern us!... We toil, and you enjoy; we produce and you dissipate;
wealth flows from us, and you absorb it. Privileged men, class distinct
from the people, form a class apart and govern yourselves.
According to the authors of A Mutualist FAQ, "it would be a
mistake to make a sharp distinction between this analysis and the later
critique of capitalism. The heritage of the manorial economy and the
feudal aristocracy blurred the distinction between the state and the
economic ruling class. But such a distinction is largely imaginary in
any social system. The main difference is that manorialism was openly
founded on conquest, whereas capitalism hid its exploitative character
behind a facade of 'neutral' laws."
They further write that "[t]he critique of pre-capitalist authority
structures had many features that could be expanded by analogy to the
critique of capitalism. The mutualist analysis of capitalism as a system
of state-enforced privilege is a direct extension of the
Jacobin/radical critique of the landed aristocracy. The credit and
patent monopolies were attacked on much the same principles as the
radicals of the 1790s attacked seigneural rents. There was a great
continuity of themes from the 1790s through Owenist and Chartist times.
One such theme was the importance of widespread, egalitarian property
ownership by the laboring classes, and the inequity of concentrating
property ownership in the hands of a few non-producers." According to them, this prefigured distributism. Other notable people mentioned as influences on mutualism include John Ball and Wat Tyler as part of the Peasants' Revolt, William Cobbett, the English Dissenter and radical offshoots of Methodism such as the Primitive Methodists and the New Connexion, as well as the more secular versions of republicanism and economic populism going back to the Diggers and the Levellers, the Fifth Monarchists, William Godwin, Robert Owen, Thomas Paine, Thomas Spence and the Quakers.
By 1846, Proudhon was speaking of "mutuality" (mutualité) in his writings, and he used the term "mutualism" (mutuellisme) at least as early as 1848 in his Programme Révolutionnaire. In 1850, Greene used the term mutualism to describe a mutual credit system similar to that of Proudhon. In 1850, the American newspaper The Spirit of the Age, edited by William Henry Channing, published proposals for a mutualist township by Joshua King Ingalls and Albert Brisbane, together with works by Proudhon, Greene, Leroux and others.
Proudhon ran for the French Constituent Assembly
in April 1848 but was not elected, although his name appeared on the
ballots in Paris, Lyon, Besançon and Lille. He was successful in the
complementary elections of 4 June and served as a deputy during the
debates over the National Workshops, created by the 25 February 1848 decree passed by Republican Louis Blanc.
The workshops were to give work to the unemployed. Proudhon was never
enthusiastic about such workshops, perceiving them as charitable
institutions that did not resolve the problems of the economic system.
He was against their elimination unless an alternative could be found
for the workers who relied on the workshops for subsistence.
Proudhon was surprised by the French Revolution of 1848.
He participated in the February uprising and the composition of what he
termed "the first republican proclamation" of the new republic.
However, he had misgivings about the new provisional government headed
by Jacques-Charles Dupont de l'Eure (1767–1855), who since the French Revolution
in 1789 had been a longstanding politician, although often in the
opposition. Proudhon published his perspective for reform, completed in
1849, titled Solution du problème social (Solution of the Social Problem),
in which he laid out a program of mutual financial cooperation among
workers. He believed this would transfer control of economic relations
from capitalists and financiers
to workers. The central part of his plan was establishing a bank to
provide credit at a very low interest rate and issuing exchange notes
that would circulate instead of money based on gold.
19th-century United States
Mutualism was especially prominent in the United States and advocated by American individualist anarchists. While individualist anarchists in Europe are pluralists who advocate anarchism without adjectives and synthesis anarchism, ranging from anarcho-communist to mutualist economic types, most individualist anarchists in the United States advocate mutualism as a libertarian socialist form of market socialism or a free-market socialist form of classical economics.
Mutualism has been associated with two types of currency reform. Labour notes were first discussed in Owenite circles and received their first practical test in 1827 in the Time Store of former New Harmony member and individualist anarchist Josiah Warren.
Mutual banking aimed at the monetization of all forms of wealth and the
extension of free credit. It is most closely associated with William Batchelder Greene, but Greene drew from the work of Proudhon, Edward Kellogg
and William Beck and from the land bank tradition. Within individualist
anarchist circles, mutualism meant non-communist anarchism or
non-communist socialism.
American individualist anarchist
Benjamin Tucker, one of the individualist anarchists influenced by Proudhon's mutualism
Historian Wendy McElroy
reports that American individualist anarchism received an important
influence from three European thinkers. One of the most important
influences was the French political philosopher Pierre-Joseph Proudhon,
whose words "Liberty is not the Daughter But the Mother of Order"
appeared as a motto on Liberty's masthead. Liberty was an influential American individualist anarchist publication by Benjamin Tucker.
For American anarchist historian Eunice Minette Schuster, "[i]t is
apparent ... that Proudhonian Anarchism was to be found in the United
States at least as early as 1848 and that it was not conscious of its
affinity to the Individualist Anarchism of Josiah Warren and Stephen Pearl Andrews. ... William B. Greene presented this Proudhonian Mutualism in its purest and most systematic form".
After 1850, Greene became active in labour reform.
He was elected vice-president of the New England Labor Reform League,
the majority of the members holding to Proudhon's scheme of mutual
banking, and in 1869, the Massachusetts Labor Union president. He then publishes Socialistic, Communistic, Mutualistic, and Financial Fragments (1875). He saw mutualism as the synthesis of "liberty and order".
His "associationism ... is checked by individualism. ... 'Mind your own
business,' 'Judge not that ye be not judged.' Over matters which are
purely personal, as for example, moral conduct, the individual is
sovereign as well as over that which he himself produces. For this
reason, he demands 'mutuality' in marriage—the equal right of a woman to
her own personal freedom and property".
In Individual Liberty, Tucker later connected his economic views with those of Proudhon, Warren and Karl Marx,
taking sides with the first two while also arguing against American
anti-socialists who declared socialism as imported, writing:
The economic principles of Modern Socialism are a logical
deduction from the principle laid down by Adam Smith in the early
chapters of his Wealth of Nations, – namely, that labor is the
true measure of price. ... Half a century or more after Smith enunciated
the principle above stated, Socialism picked it up where he had dropped
it, and in following it to its logical conclusions, made it the basis
of a new economic philosophy. ... This seems to have been done
independently by three different men, of three different nationalities,
in three different languages: Josiah Warren, an American; Pierre J.
Proudhon, a Frenchman; Karl Marx, a German Jew. ... That the work of
this interesting trio should have been done so nearly simultaneously
would seem to indicate that Socialism was in the air, and that the time
was ripe and the conditions favorable for the appearance of this new
school of thought. So far as priority of time is concerned, the credit
seems to belong to Warren, the American, – a fact which should be noted
by the stump orators who are so fond of declaiming against Socialism as an imported article.
19th-century Spain
Mutualist ideas found fertile ground in the 19th century in Spain. In
Spain, Ramón de la Sagra established the anarchist journal El Porvenir in A Coruña in 1845, inspired by Proudhon's ideas. The Catalan politician Francesc Pi i Margall became the principal translator of Proudhon's works into Spanish
and later briefly became president of Spain in 1873 while being the
leader of the Democratic Republican Federal Party. According to George Woodcock,
"[t]hese translations were to have a profound and lasting effect on the
development of Spanish anarchism after 1870, but before that time
Proudhonian ideas, as interpreted by Pi, already provided much of the
inspiration for the federalist movement which sprang up in the early
1860's [sic]".
According to the Encyclopædia Britannica, "[d]uring the Spanish revolution of 1873, Pi y Margall attempted to establish a decentralized, or cantonalist, political system on Proudhonian lines". Pi i Margall was a dedicated theorist in his own right, especially through book-length works such as La reacción y la revolución (Reaction and Revolution from 1855), Las nacionalidades (Nationalities from 1877) and La Federación (The Federation from 1880). For prominent anarcho-syndicalist Rudolf Rocker,
"[t]he first movement of the Spanish workers was strongly influenced by
the ideas of Pi y Margall, leader of the Spanish Federalists and
disciple of Proudhon. Pi y Margall was one of the outstanding theorists
of his time and had a powerful influence on the development of
libertarian ideas in Spain. His political ideas had much in common with
those of Richard Price, Joseph Priestly [sic], Thomas Paine, Jefferson,
and other representatives of the Anglo-American liberalism of the first
period. He wanted to limit the power of the state to a minimum and
gradually replace it by a Socialist economic order".
First International and Paris Commune
According to a historian of the First International,
G. M. Stekloff, in April 1856, "arrived from Paris a deputation of
Proudhonist workers whose aim it was to bring about the foundation of a
Universal League of Workers. The object of the League was the social
emancipation of the working class, which, it was held, could only be
achieved by a union of the workers of all lands against international
capital. Since the deputation was one of Proudhonists, of course this
emancipation was to be secured, not by political methods, but purely by
economic means, through the foundation of productive and distributive
co-operatives".
Stekloff continues by saying that "[i]t was in the 1863 elections that
for the first time workers' candidates were run in opposition to
bourgeois republicans, but they secured very few votes. ... [A] group of
working-class Proudhonists (among whom were Murat and Tolain, who were
subsequently to participate in the founding of the (First) International
issued the famous Manifesto of the Sixty, which, though extremely
moderate in tone, marked a turning point in the history of the French
movement. For years and years the bourgeois liberals had been insisting
that the revolution of 1789 had abolished class distinctions. The
Manifesto of the Sixty loudly proclaimed that classes still existed.
These classes were the bourgeoisie and the proletariat. The latter had
its specific class interests, which none but workers could be trusted to
defend. The inference drawn by the Manifesto was that there must be
independent working-class candidates".
For Stekloff, "the Proudhonists, who were at that date the
leaders of the French section of the International. They looked upon the
International Workingmen's Association as a sort of academy or
synagogue, where Talmudists or similar experts could "investigate" the
workers' problem; wherein the spirit of Proudhon they could excogitate
means for an accurate solution of the problem without being disturbed by
the stresses of a political campaign. Thus Fribourg, voicing the
opinions of the Parisian group of the Proudhonists (Tolain and Co.),
assured his readers that "the International was the greatest attempt
ever made in modern times to aid the proletariat towards the conquest,
by peaceful, constitutional, and moral methods, of the place which
rightly belongs to the workers in the sunshine of civilisation".
According to Stekoff, the Belgian Federation "threw in its lot with the
anarchist International at its Brussels Congress, held in December,
1872. ... [T]hose taking part in the socialist movement of the Belgian
intelligentsia were inspired by Proudhonist ideas which naturally led
them to oppose the Marxist outlook".
Mutualism also had a considerable influence on the Paris Commune. George Woodcock
manifests that "a notable contribution to the activities of the Commune
and particularly to the organization of public services was made by
members of various anarchist factions, including the mutualists Courbet,
Longuet, and Vermorel, the libertarian collectivists Varlin, Malon, and Lefrangais, and the bakuninists Elie and Elisée Reclus and Louise Michel".
21st century
19th-century mutualists considered themselves libertarian socialists and are still considered libertarian socialists today. While oriented towards cooperation, mutualists favour free-market solutions, believing that most inequalities result from preferential conditions created by government intervention. Mutualism is a middle way between classical economics and socialism of the collectivist variety, with some characteristics of both. As for capital goods (manufactured and non-land means of production), mutualist opinion differs on whether these should be common property and commonly managed public assets or private property in the form of worker cooperatives, for as long as they ensure the worker's right to the full product of their labour, mutualists support markets and property in the product of labour, differentiating between capitalist private property (productive property) and personal property (private property).
Contemporary mutualist Kevin Carson considers mutualism to be free-market socialism. Proudhon supported labor-owned cooperative firms and associations, for "we need not hesitate, for we have no choice. ... [I]t is necessary
to form an association among workers ... because without that, they
would remain related as subordinates and superiors, and there would
ensue two ... castes of masters and wage-workers, which is repugnant to a
free and democratic society" and so "it becomes necessary for the
workers to form themselves into democratic societies, with equal
conditions for all members, on pain of a relapse into feudalism". In the preface to his Studies in Mutualist Political Economy, Carson describes this work as "an attempt to revive individualist anarchist
political economy, to incorporate the useful developments of the last
hundred years, and to make it relevant to the problems of the
twenty-first century". Carson holds that capitalism
has been founded on "an act of robbery as massive as feudalism" and
argues that capitalism could not exist in the absence of a state. He
says that "[i]t is state intervention that distinguishes capitalism from
the free market".
Carson does not define capitalism in the idealized sense, but he says
that when he talks about capitalism, he is referring to what he calls actually existing capitalism. Carson believes the term laissez-faire
capitalism is an oxymoron because capitalism, he argues, is an
"organization of society, incorporating elements of tax, usury,
landlordism, and tariff, which thus denies the Free Market while
pretending to exemplify it". Carsons says he has no quarrel with anarcho-capitalists who use the term laissez-faire
capitalism and distinguish it from actually existing capitalism.
Although Carson says he has deliberately chosen to resurrect an old
definition of the term. Many anarchists, including mutualists, continue to use the term and do not consider it an old definition. Carson argues that the centralization of wealth into a class hierarchy is due to state intervention to protect the ruling class by using a money monopoly, granting patents and subsidies to corporations, imposing discriminatory taxation and intervening militarily to gain access to international markets. Carson's thesis is that an authentic and free market economy
would not be capitalism as the separation of labour from ownership and
the subordination of labour to capital would be impossible, bringing a
classless society where people could easily choose between working as a
freelancer, working for a living wage, taking part of a cooperative, or being an entrepreneur. As Benjamin Tucker
before, Carson notes that a mutualist free-market system would involve
significantly different property rights than capitalism, particularly
regarding land and intellectual property.
Following Proudhon, mutualists are libertarian socialists who consider themselves part of the market socialist tradition and the socialist movement. However, some contemporary mutualists outside the classical anarchist tradition, such as those involved in the market-oriented left-libertarianism within the Alliance of the Libertarian Left and the Voluntary Cooperation Movement, abandoned the labour theory of value and prefer to avoid the term socialist due to its association with state socialism throughout the 20th century. Nonetheless, those contemporary mutualists are part of the libertarian left and "still retain some cultural attitudes, for the most part, that set them off from the libertarian right.
Most of them view mutualism as an alternative to capitalism, and
believe that capitalism as it exists is a statist system with
exploitative features".
According to historian James J. Martin, the individualist anarchists in the United States were socialists whose support for the labour theory of value made their libertarian socialist form of mutualism a free-market socialist alternative to capitalism and Marxism.
Theory
The primary aspects of mutualism are free association, free banking, reciprocity in the form of mutual aid, workplace democracy, workers' self-management, gradualism and dual power. Mutualism is often described by its proponents as advocating an anti-capitalist free market.
Mutualists argue that most of the economic problems associated with
capitalism each amount to a violation of the cost principle, or as Josiah Warren interchangeably said, the cost the limit of price. It was inspired by the labour theory of value, which was popularized—although not invented—by Adam Smith
in 1776 (Proudhon mentioned Smith as an inspiration). The labor theory
of value holds that the actual price of a thing (or the true cost) is
the amount of labor undertaken to produce it. In Warren's terms of his cost the limit of price
theory, cost should be the limit of price, with cost referring to the
amount of labour required to produce a good or service. Anyone who sells
goods should charge no more than the cost to himself of acquiring these
goods.
Contract and federation
Mutualism
holds that producers should exchange their goods at cost-value using
contract systems. While Proudhon's early definitions of cost-value were
based on fixed assumptions about the value of labour hours, he later
redefined cost-value to include other factors such as the labour
intensity, the nature of the work involved, etc. He also expanded his
notions of contract into expanded notions of federation. Proudhon argued:
I have shown the contractor, at the birth of industry,
negotiating on equal terms with his comrades, who have since become his
workmen. It is plain, in fact, that this original equality was bound to
disappear through the advantageous position of the master and the
dependent position of the wage-workers. In vain does the law assure the
right of each to enterprise. ... When an establishment has had leisure
to develop itself, enlarge its foundations, ballast itself with capital,
and assure itself a body of patrons, what can a workman do against a
power so superior?
Dual power and gradualism
Dual
power is the process of building alternative institutions to the ones
that already exist in modern society. Initially theorized by Proudhon,
it has become adopted by many anti-state movements such as agorism and autonomism. Proudhon described it as follows:
Beneath the governmental machinery, in the shadow of
political institutions, out of the sight of statemen and priests,
society is producing its own organism, slowly and silently; and
constructing a new order, the expression of its vitality and autonomy.
As Proudhon also theorized it, dual power should not be confused with the dual power popularized by Vladimir Lenin. Proudhon's meaning refers to a more specific scenario where a
revolutionary entity intentionally maintains the structure of the
previous political institutions until the power of the previous
institution is weakened enough such that the revolutionary entity can
overtake it entirely. Dual power, as implemented by mutualists, is the
development of the alternative institution itself.
Free association
Mutualists
argue that association is only necessary where there is an organic
combination of forces. An operation requires specialization and many
different workers performing tasks to complete a unified product, i.e. a
factory. In this situation, workers are inherently dependent on each
other; without association, they are related as subordinate and
superior, master and wage-slave. An operation that an individual can
perform without the help of specialized workers does not require
association. Proudhon argued that peasants do not require societal form
and only feigned association for solidarity in abolishing rents, buying
clubs, etc. He recognized that their work is inherently sovereign and
free. In commenting on the degree of association that is preferable, Proudhon wrote:
In cases in which production requires great division of
labour, it is necessary to form an association among the workers ...
because without that they would remain isolated as subordinates and
superiors, and there would ensue two industrial castes of masters and
wage workers, which is repugnant in a free and democratic society. But
where the product can be obtained by the action of an individual or a
family, ... there is no opportunity for association.
For Proudhon, mutualism involved creating industrial democracy.
In this system, workplaces would be "handed over to democratically
organised workers' associations. ... We want these associations to be
models for agriculture, industry and trade, the pioneering core of that
vast federation of companies and societies woven into the common cloth
of the democratic social Republic".
Under mutualism, workers would no longer sell their labour to a
capitalist but rather work for themselves in co-operatives. Proudhon
urged "workers to form themselves into democratic societies, with equal
conditions for all members, on pain of a relapse into feudalism". This
would result in "[c]apitalistic and proprietary exploitation, stopped
everywhere, the wage system abolished, equal and just exchange
guaranteed".
As Robert Graham
notes, "Proudhon's market socialism is indissolubly linked to his
notions of industrial democracy and workers' self-management".
K. Steven Vincent notes in his in-depth analysis of this aspect of
Proudhon's ideas that "Proudhon consistently advanced a program of
industrial democracy which would return control and direction of the
economy to the workers". For Proudhon, "strong workers' associations ...
would enable the workers to determine jointly by election how the
enterprise was to be directed and operated on a day-to-day basis".
Mutual credit
American individualist anarchist
Lysander Spooner, who supported free banking and mutual credit
Mutualists support mutual credit and argue that free banking
should be taken back by the people to establish systems of free credit.
They contend that banks have a monopoly on credit, just as capitalists
have a monopoly on the means of production and landlords have a land
monopoly. Banks create money by lending out deposits that do not belong
to them and then charging interest on the difference. Mutualists argue
that by establishing a democratically run mutual savings bank or credit union,
it would be possible to issue free credit so that money could be
created for the participants' benefit rather than the bankers' benefit.
Individualist anarchists noted for their detailed views on mutualist
banking include Pierre-Joseph Proudhon, William Batchelder Greene and Lysander Spooner.
In a session of the French legislature, Proudhon proposed a government-imposed income tax to fund his mutual banking scheme, with some tax brackets reaching as high as 331⁄3 percent and 50 percent, but the legislature turned it down. This income tax Proudhon proposed to fund his bank was to be levied on rents, interest, debts and salaries.
Specifically, Proudhon's proposed law required all capitalists and
stockholders to disburse one-sixth of their income to their tenants and
debtors and another sixth to the national treasury to fund the bank.
This scheme was vehemently objected to by others in the legislature, including Frédéric Bastiat. The reason for rejecting the income tax was that it would result in economic ruin and violate "the right of property". Proudhon once proposed funding a national bank with a voluntary tax of 1% in his debates with Bastiat. Proudhon also argued for the abolition of all taxes.
Property
Pierre-Joseph Proudhon was an anarchist and socialist philosopher who articulated thoughts on the nature of property. He claimed that "property is theft", "property is liberty", and "property is impossible". According to Colin Ward,
Proudhon did not see a contradiction between these slogans. This was
because Proudhon distinguished between what he considered to be two
distinct forms of property often bound up in a single label. To the
mutualist, this is the distinction between property created by coercion
and property created by labour. Property is theft "when it is related to
a landowner or capitalist whose ownership is derived from conquest or
exploitation and [is] only maintained through the state, property laws,
police, and an army". Property is freedom for "the peasant or artisan
family [who have] a natural right to a home, land [they may]
cultivate, ... to tools of a trade" and the fruits of that
cultivation—but not to ownership or control of the lands and lives of
others. The former is considered illegitimate property, while the latter
is legitimate property. Some individualist anarchists and followers of Proudhon's mutualism, such as Benjamin Tucker, started calling possession property or private property, causing confusion within the anarchist movement and among other socialists.
Proudhon argued that property in the product of labour is
essential to liberty, while property that strayed from possession
("occupancy and use") was the basis for tyranny and would lead society
to destroy itself.
The conception of entitlement property as a destructive force and
illegitimate institution can be seen in this quote by Proudhon, who
argued:
Then if we are associated for the sake of liberty,
equality, and security, we are not associated for the sake of property;
then if property is a natural right, this natural right is not social,
but anti-social. Property and society are utterly irreconcilable
institutions. It is as impossible to associate two proprietors as to
join two magnets by their opposite poles. Either society must perish, or
it must destroy property. If property is a natural, absolute,
imprescriptible, and inalienable right, why, in all ages, has there been
so much speculation as to its origin? – for this is one of its
distinguishing characteristics. The origin of a natural right! Good God!
who ever inquired into the origin of the rights of liberty, security,
or equality?
In What Is Mutualism?, Clarence Lee Swartz wrote:
It is, therefore, one of the purposes of Mutualists, not
only to awaken in the people the appreciation of and desire for freedom,
but also to arouse in them a determination to abolish the legal
restrictions now placed upon non-invasive human activities and to
institute, through purely voluntary associations, such measures as will
liberate all of us from the exactions of privilege and the power of
concentrated capital.
Swartz also argued that mutualism differs from anarcho-communism
and other collectivist philosophies by its support of private property,
writing: "One of the tests of any reform movement with regard to
personal liberty is this: Will the movement prohibit or abolish private
property? If it does, it is an enemy of liberty. For one of the most
important criteria of freedom is the right to private property in the
products of ones labor. State Socialists, Communists, Syndicalists and
Communist-Anarchists deny private property." However, Proudhon warned that a society with private property would lead to statist relations between people, arguing:
The purchaser draws boundaries, fences himself in, and
says, 'This is mine; each one by himself, each one for himself.' Here,
then, is a piece of land upon which, henceforth, no one has right to
step, save the proprietor and his friends; which can benefit nobody,
save the proprietor and his servants. Let these multiply, and soon the
people ... will have nowhere to rest, no place of shelter, no ground to
till. They will die of hunger at the proprietor's door, on the edge of
that property which was their birth-right; and the proprietor, watching
them die, will exclaim, 'So perish idlers and vagrants.'
Unlike capitalist
private-property supporters, Proudhon stressed equality. He thought
that all workers should own property and have access to capital,
stressing that in every cooperative, "every worker employed in the
association [must have] an undivided share in the property of the
company".
This distinction Proudhon made between different kinds of property has
been articulated by some later anarchist and socialist theorists as one
of the first distinctions between private property and personal property, with the latter having direct use-value to the individual possessing it. For Proudhon, as he wrote in the sixth study of his General Idea of the Revolution in the Nineteenth Century, the capitalist's employee was "subordinated, exploited: his permanent condition is one of obedience".
Usufruct
Mutualists believe that land should not be a commodity
to be bought and sold, advocating for conditional titles to land based
on occupancy and use norms. Mutualists argue whether an individual has a
legitimate claim to land ownership if he is not currently using it but
has already incorporated his labour into it. All mutualists agree that
everything produced by human labour and machines can be owned as personal property. Mutualists reject the idea of non-personal property and non-proviso Lockean sticky property. Any property obtained through violence, bought with money gained through exploitation, or bought with money that was gained violating usufruct property norms is considered illegitimate.
According to mutualist theory, the main problem with capitalism
is that it allows for non-personal property ownership. Under these
conditions, a person can buy property they do not physically use with
the only goal of owning said property to prevent others from using it,
putting them in an economically weak position, vulnerable enough to be
controlled and exploited. Mutualists argue that this is historically how
certain people were able to become capitalists. According to mutualism, capitalists make money by exercising power rather than labouring. Over time, under these conditions, there emerged a minority class of individuals who owned all the means of production
as non-personal property (the capitalist class) and a large class of
individuals with no access to the means of production (the labouring
class). The labouring class does not have direct access to the means of
production and therefore is forced to sell the only thing they can to
survive, i.e. their labour power,
giving up their freedom to someone who owns the means of production in
exchange for a wage. A worker's wage is always less than the value of
the goods and services he produces. If an employer pays a labourer equal
to the value of the goods and services he produces, then the capitalist
would break even at most. In reality, the capitalist pays his worker
less, and after subtracting overhead,
the remaining difference is exploited profit which the capitalist has
gained without working. Mutualists point out that the money capitalists
use to buy new means of production is the surplus value they exploit from labourers.
Mutualists also argue that capitalists maintain ownership of
their non-personal properties because they support state violence by
funding election campaigns. The state
protects capitalist non-personal property ownership against direct
occupation and use by the public in exchange for money and election
support. Capitalists can then continue buying labour power and the means
of production as non-personal property and extracting surplus value
from more labourers, continuing the cycle. Mutualist theory states that
by establishing usufruct property norms, exclusive non-personal
ownership of the means of production by the capitalist class would be
eliminated. The labouring classes would then have direct access to means
of production, enabling them to work and produce freely in worker-owned
enterprises while retaining the full value of whatever they sell. Wage labour in the form of wage slavery
would be eliminated, and it would be impossible to become a capitalist
because the widespread labour market would no longer exist. No one would
be able to own the means of production in the form of non-personal
property, two ingredients necessary for labour exploitation. This would
result in the capitalist class labouring with the rest of society.
Criticism
Anarchism
In Europe, a contemporary critic of Proudhon was the early libertarian communist Joseph Déjacque, who was able to serialise his book L'Humanisphère, Utopie anarchique (The Humanisphere: Anarchic Utopia) in his periodical Le Libertaire, Journal du Mouvement Social (Libertarian: Journal of Social Movement), published in 27 issues from 9 June 1858 to 4 February 1861 while living in New York.
Unlike and against Proudhon, he argued that "it is not the product of
his or her labor that the worker has a right to, but to the satisfaction
of his or her needs, whatever may be their nature". In his critique of Proudhon, Déjacque also coined the word libertarian
and argued that Proudhon was merely a liberal, a moderate, suggesting
he become "frankly and completely an anarchist" instead by giving up all
forms of authority and property. Since then, the word libertarian
has been used to describe this consistent anarchism which rejected
private and public hierarchies along with property in the products of
labour and the means of production. Libertarianism is frequently used as
a synonym for anarchism and libertarian socialism.
One area of disagreement between anarcho-communists and mutualists stems from Proudhon's alleged advocacy of labour vouchers to compensate individuals for their labour and markets or artificial markets
for goods and services. However, the persistent claim that Proudhon
proposed a labour currency has been challenged as a misunderstanding or
misrepresentation. Like other anarcho-communists, Peter Kropotkin advocated the abolition of labour remuneration and questioned, "how can this new form of wages, the labor note,
be sanctioned by those who admit that houses, fields, mills are no
longer private property, that they belong to the commune or the nation?" According to George Woodcock, Kropotkin believed that a wage system, whether "administered by Banks of the People or by workers' associations through labor cheques", is a form of compulsion.
Collectivist anarchist Mikhail Bakunin was an adamant critic of Proudhonian mutualism as well,
stating: "How ridiculous are the ideas of the individualists of the
Jean Jacques Rousseau school and of the Proudhonian mutualists who
conceive society as the result of the free contract of individuals
absolutely independent of one another and entering into mutual relations
only because of the convention drawn up among men. As if these men had
dropped from the skies, bringing with them speech, will, original
thought, and as if they were alien to anything of the earth, that is,
anything having social origin". Bakunin also specifically criticized Proudhon,
stating that "[d]espite all his efforts to free himself from the
traditions of classical idealism, Proudhon remained an incorrigible
idealist all his life, swayed at one moment by the Bible and the next by
Roman Law (as I told him two months before he died)."
According to Paul McLaughlin, Bakunin held that "'Proudhon, in spite of
all his efforts to shake off the tradition of classical idealism,
remained all his life an incorrigible idealist', 'unable to surmount
idealistic phantoms' in spite of himself. It is Bakunin's purpose to rid
Proudhon's libertarian thought of its metaphysicality, that is, to
naturalize his anarchism — thereby overcoming its abstract, indeed
reactionary, individualism and transforming it into a social anarchism."
Capitalism
The
pro-capitalism criticism is due to the different conceptions of
property rights between capitalism and mutualism. The latter supports
free access to capital, the means of production and natural resources,
arguing that permanent private ownership of land and capital results in
monopolization without equal liberty
of access. Mutualism also argues that a society with capitalist private
property inevitably leads to statist relations between people.
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