J.5 What alternative social organisations do anarchists create?

The short answer is no, they do not. While the Individualist Anarchists and Mutualists (followers of Proudhon) do think that mutual banking is the only sure way of abolishing capitalism, most anarchists do not see mutualism as an end in itself. Few think that capitalism can be reformed away in the manner assumed by Proudhon. Increased access to credit does not address the relations of production and market power which exist within the economy and so any move for financial transformation has to be part of a broader attack on all forms of capitalist social power in order to be both useful and effective (see section B.3.2 for more anarchist views on mutual credit and its uses). So, for most anarchists, it is only in combination with other forms of working class self-activity and self-management that mutualist institutions could play an important role in the class struggle.

By creating a network of mutual banks to aid in creating co-operatives, union organising drives, supporting strikes (either directly by gifts/loans or funding food and other co-operatives which could supply food and other essentials free or at a reduction), mutualism can be used as a means of helping build libertarian alternatives within the capitalist system. Such alternatives, while making life better under the current system, also can play a role in overcoming that system by being a means of aiding those in struggle make ends meet and providing alternative sources of income for black-listed or sacked workers. Thus Bakunin's comments:

"let us co-operate in our common enterprise to make our lives a little bit more supportable and less difficult. Let us, wherever possible, establish producer-consumer co-operatives and mutual credit societies which, though under the present economic conditions they cannot in any real or adequate way free us, are nevertheless important inasmuch they train the workers in the practices of managing the economy and plant the precious seeds for the organisation of the future." [Bakunin on Anarchism, p. 173]

Therefore, while few anarchists think that mutualism would be enough in itself, it can play a role in the class struggle. As a compliment to direct action and workplace and community struggle and organisation, mutualism has an important role in working class self-liberation. For example, community unions (see section J.5.1) could create their own mutual banks and money which could be used to fund co-operatives and support strikes and other forms of social struggle. In this way a healthy communalised co-operative sector could develop within capitalism, overcoming the problems of isolation facing workplace co-operatives (see section J.5.11) as well as providing a firm framework of support for those in struggle.

Moreover, mutual banking can be a way of building upon and strengthening the anarchistic social relations within capitalism. For even under capitalism and statism, there exists extensive mutual aid and, indeed, anarchistic and communistic ways of living. For example, communistic arrangements exist within families, between friends and lovers and within anarchist organisations.

Mutual banking could be a means of creating a bridge between this alternative (gift) "economy" and capitalism. The mutualist alternative economy would help strength communities and bonds of trust between individuals, and this would increase the scope for increasing the scope of the communistic sector as more and more people help each other out without the medium of exchange - in other words, mutualism will help the gift economy that exists within capitalism to grow and develop.

J.5.8 What would a modern system of mutual banking look like?

The mutual banking ideas of Proudhon could be adapted to the conditions of modern society, as will be described in what follows. (Note: Proudhon is the definitive source on mutualism, but for those who don't read French, there are the works of his American disciples, e.g. William B. Greene's Mutual Banking, and Benjamin Tucker's Instead of a Book by a Man Too Busy to Write One).

One scenario for an updated system of mutual banking would be for a community barter association to begin issuing an alternative currency accepted as money by all individuals within the system. This "currency" would not at first take the form of coins or bills, but would be circulated entirely through transactions involving the use of barter-cards, personal checks, and "e-money" transfers via modem/Internet. Let's call this currency-issuing type of barter association a "mutual barter clearinghouse," or just "clearinghouse" for short.

The clearinghouse would have a twofold mandate: first, to extend credit at cost to members; second, to manage the circulation of credit-money within the system, charging only a small service fee (probably one percent or less) which is sufficient to cover its costs of operation, including labour costs involved in issuing credit and keeping track of transactions, insuring itself against losses from uncollectable debts, and so forth.

The clearinghouse would be organised and function as follows. Members of the original barter association would be invited to become subscriber-members of the clearinghouse by pledging a certain amount of property as collateral. On the basis of this pledge, an account would be opened for the new member and credited with a sum of mutual dollars equivalent to some fraction of the assessed value of the property pledged. The new member would agree to repay this amount plus the service fee by a certain date. The mutual dollars in the new account could then be transferred through the clearinghouse by using a barter card, by writing a personal check, or by sending e-money via modem to the accounts of other members, who have agreed to receive mutual money in payment for all debts.

The opening of this sort of account is, of course, the same as taking out a "loan" in the sense that a commercial bank "lends" by extending credit to a borrower in return for a signed note pledging a certain amount of property as security. The crucial difference is that the clearinghouse does not purport to be "lending" a sum of money that it already has, as is fraudulently claimed by commercial banks. Instead it honestly admits that it is creating new money in the form of credit. New accounts can also be opened simply by telling the clearinghouse that one wants an account and then arranging with other people who already have balances to transfer mutual money into one's account in exchange for goods or services.

Another form is that associated with LETS systems. In this a number of people get together to form an association. They create a unit of exchange (which is equal in value to a unit of the national currency usually), choose a name for it and offer each other goods and services priced in these units. These offers and wants are listed in a directory which is circulated periodically to members. Members decide who they wish to trade with and how much trading they wish to do. When a transaction is completed, this is acknowledged with a "cheque" made out by the buyer and given to the seller. These are passed on to the system accounts administration which keeps a record of all transactions and periodically sends members a statement of their accounts. The accounts administration is elected by, and accountable to, the membership and information about balances is available to all members.

Unlike the first system described, members do not have to present property as collateral. Members of a LETS scheme can go into "debt" without it, although "debt" is the wrong word as members are not so much going into debt as committing themselves to do some work within the system in the future and by so doing they are creating spending power. The willingness of members to incur such a commitment could be described as a service to the community as others are free to use the units so created to trade themselves. Indeed, the number of units in existence exactly matches the amount of real wealth being exchanged. The system only works if members are willing to spend and runs on trust and builds up trust as the system is used.

It is likely that a fully functioning mutual banking system would incorporate aspects of both these systems. The need for collateral may be used when members require very large loans while the LETS system of negative credit as a commitment to future work would be the normal function of the system. If the mutual bank agrees a maximum limit for negative balances, it may agree to take collateral for transactions that exceed this limit. However, it is obvious that any mutual banking system will find the best means of working in the circumstances it finds itself.

J.5.9 How does mutual credit work?

Let's consider an example of how business would be transacted in the new system. There are two possibilities, depending on whether the mutual credit is based upon whether the creditor can provide collateral or not. we will take the case with collateral first.

Suppose that A, an organic farmer, pledges as collateral a certain plot of land that she owns and on which she wishes to build a house. The land is valued at, say, $40,000 in the capitalist market. By pledging the land, A is able to open a credit account at the clearinghouse for, say, $30,000 in mutual money (a ratio of 3/4). She does so knowing that there are many other members of the system who are carpenters, electricians, plumbers, hardware dealers, and so on who are willing to accept mutual dollars in payment for their products or services.

It's easy to see why other subscriber-members, who have also obtained mutual credit and are therefore in debt to the clearinghouse for mutual dollars, would be willing to accept such dollars in return for their goods and services. For they need to collect mutual dollars to repay their debts. But why would someone who is not in debt for mutual dollars be willing to accept them as money?

To see why, let's suppose that B, an underemployed carpenter, currently has no account at the clearinghouse but that he knows about the clearinghouse and the people who operate it. After examining its list of members and becoming familiar with the policies of the new organisation, he's convinced that it does not extend credit frivolously to untrustworthy recipients who are likely to default. He also knows that if he contracts to do the carpentry on A's new house and agrees to be paid for his work in mutual money, he'll then be able to use it to buy groceries, clothes, car repairs, and other goods and services from various people in the community who already belong to the system.

Thus B will be willing, and perhaps even eager (especially if the economy is in recession and regular money is tight) to work for A and receive payment in mutual dollars. For he knows that if he is paid, say, $8,000 in mutual money for his labour on A's house, this payment constitutes, in effect, 20 percent of a mortgage on her land, the value of which is represented by her mutual credit. B also understands that A has promised to repay this mortgage by producing new value -- that is, by growing organic fruits and vegetables and selling them for mutual dollars to other members of the system -- and that it is this promise to produce new wealth which gives her mutual credit its value as a medium of exchange.

To put this point slightly differently, A's mutual credit can be thought of as a lien against goods or services which she has guaranteed to create in the future. As security of this guarantee, she agrees that if she is unable for some reason to fulfil her obligation, the land she has pledged will be sold for mutual dollars to other members. In this way, a value sufficient to cancel her debt (and probably then some) will be returned to the system. This provision insures that the clearinghouse is able to balance its books and gives members confidence that mutual money is sound.

It should be noticed that since new wealth is continually being created, the basis for new mutual credit is also being created at the same time. Thus, suppose that after A's new house has been built, her daughter, C, along with a group of friends D, E, F, . . . , decide that they want to start a collectively owned and operated organic restaurant (which will incidentally benefit A, as an outlet for her produce), but that C and her friends do not have enough collateral to obtain a start-up loan. A, however, is willing to co-sign a note for them, pledging her new house (valued at say, $80,000) as security. On this basis, C and her partners are able to obtain $60,000 worth of mutual credit, which they then use to buy equipment, supplies, furniture, advertising, etc. and lease the building necessary to start their restaurant.

This example illustrates one way in which people without property are able to obtain credit in the new system. Another way -- for those who cannot find (or perhaps don't wish to ask) someone with property to co-sign for them -- is to make a down payment and then use the property which is to be purchased on credit as security, as in the current method of obtaining a home or auto loan. With mutual credit, however, this form of financing can be used to purchase anything, including capital goods.

Which brings us to the case of an individual without means for providing collateral - say, for example A, the organic farmer, does not own the land she works. In such a case, A, who still desires work done, would contact other members of the mutual bank with the skills she requires. Those members with the appropriate skills and who agree to work with her commit themselves to do the required tasks. In return, A gives them a check in mutual dollars which is credited to their account and deducted from hers. She does not pay interest on this issue of credit and the sum only represents her willingness to do some work for other members of the bank at some future date.

The mutual bank does not have to worry about the negative balance, as this does not create a loss within the group as the minuses which have been incurred have already created wealth (pluses) within the system and it stays there. It is likely, of course, that the mutual bank would agree an upper limit on negative balances and require some form of collateral for credit greater than this limit, but for most exchanges this would be unlikely to be relevant.

It is important to remember that mutual dollars have no intrinsic value, since they can't be redeemed (at the mutual bank) in gold or anything else. All they are promises of future labour. Thus, as Greene points out in his work on mutual banking, mutual dollars are "a mere medium for the facilitation of barter." In this respect they are closely akin to the so-called "barter dollars" now being circulated by barter associations through the use of checks and barter cards. To be precise, then, we should refer to the units of mutual money as "mutual barter dollars." But whereas ordinary barter dollars are created at the same time that a barter transaction occurs and are used to record the values exchanged in that transaction, mutual barter dollars are created before any actual barter transaction occurs and are intended to facilitate future barter transactions. This fact is important because it can be used as the basis for a legal argument that clearinghouses are essentially barter associations rather than banks, thrifts, or credit unions, and therefore should not be subject to the laws governing the latter institutions.

J.5.10 Why do anarchists support co-operatives?

Support for co-operatives is a common feature in anarchist writings. Indeed, anarchist support for co-operatives is as old as use of the term anarchist to describe our ideas is. So why do anarchists support co-operatives? Basically it is because a co-operative is seen as an example of the future social organisation anarchists want in the present. As Bakunin argued, "the co-operative system. . . carries within it the germ of the future economic order." [The Philosophy of Bakunin, p. 385]

Anarchists support all kinds of co-operatives - housing, food, credit unions and productive ones. All forms of co-operation are useful as they accustom their members to work together for their common benefit as well as ensuring extensive experience in managing their own affairs. As such, all forms of co-operatives are useful examples of self-management and anarchy in action (to some degree). However, here we will concentrate on productive co-operatives, i.e. workplace co-operatives. This is because workplace co-operatives, potentially, could replace the capitalist mode of production with one based upon associated, not wage, labour. As long as capitalism exists within industry and agriculture, no amount of other kinds of co-operatives will end that system. Capital and wealth accumulates by oppression and exploitation in the workplace, therefore as long as wage slavery exists anarchy will not.

Co-operatives are the "germ of the future" because of two facts. Firstly, co-operatives are based on one worker, one vote. In other words those who do the work manage the workplace within which they do it (i.e. they are based on workers' self-management in some form). Thus co-operatives are an example of the "horizontal" directly democratic organisation that anarchists support and so are an example of "anarchy in action" (even if in an imperfect way) within the economy. In addition, they are an example of working class self-help and self-activity. Instead of relying on others to provide work, co-operatives show that production can be carried on without the existence of a class of masters employing a class of order takers.

Workplace co-operatives also present evidence of the viability of an anarchist "economy." It is well established that co-operatives are usually more productive and efficient than their capitalist equivalents. This indicates that hierarchical workplaces are not required in order to produce useful goods and indeed can be harmful. Indeed, it also indicates that the capitalist market does not actually allocate resources efficiently (as we will discuss in section J.5.12). So why should co-operatives be more efficient?

Firstly there are the positive effects of increased liberty associated with co-operatives.

Co-operatives, by abolishing wage slavery, obviously increases the liberty of those who work in them. Members take an active part in the management of their working lives and so authoritarian social relations are replaced by libertarian ones. Unsurprisingly, this liberty also leads to an increase in productivity - just as wage labour is more productive than slavery, so associated labour is more productive than wage slavery. Little wonder Kropotkin argued that "the only guarantee not to be robbed of the fruits of your labour is to possess the instruments of labour. . . man really produces most when he works in freedom, when he has a certain choice in his occupations, when he has no overseer to impede him, and lastly, when he sees his work bringing profit to him and to others who work like him, but bringing in little to idlers." [The Conquest of Bread, p. 145]

There are also the positive advantages associated with participation (i.e. self-management, liberty in other words). Within a self-managed, co-operative workplace, workers are directly involved in decision making and so these decisions are enriched by the skills, experiences and ideas of all members of the workplace. In the words of Colin Ward:

"You can be in authority, or you can be an authority, or you can have authority. The first derives from your rank in some chain of command, the second derives special knowledge, and the third from special wisdom. But knowledge and wisdom are not distributed in order of rank, and they are no one person's monopoly in any undertaking. The fantastic inefficiency of any hierarchical organisation -- any factory, office, university, warehouse or hospital -- is the outcome of two almost invariable characteristics. One is that the knowledge and wisdom of the people at the bottom of the pyramid finds no place in the decision-making leadership hierarchy of the institution. Frequently it is devoted to making the institution work in spite of the formal leadership structure, or alternatively to sabotaging the ostensible function of the institution, because it is none of their choosing. The other is that they would rather not be there anyway: they are there through economic necessity rather than through identification with a common task which throws up its own shifting and functional leadership.

"Perhaps the greatest crime of the industrial system is the way it systematically thwarts the investing genius of the majority of its workers." [Anarchy in Action, p. 41]

Secondly, the increased efficiency of co-operatives results from the benefits associated with co-operation itself. Not only does co-operation increase the pool of knowledge and abilities available within the workplace and enriches that source by communication and interaction, it also ensures that the workforce are working together instead of competing and so wasting time and energy. As Alfie Kohn notes (in relation to investigations of in-firm co-operation):

"Dean Tjosvold of Simon Frazer. . .conducted [studies] at utility companies, manufacturing plants, engineering firms, and many other kinds of organisations. Over and over again, Tjosvold has found that 'co-operation makes a work force motivated' whereas 'serious competition undermines co-ordination.' . . . Meanwhile, the management guru. . . T. Edwards Demming, has declared that the practice of having employees compete against each other is 'unfair [and] destructive. We cannot afford this nonsense any longer. . . [We need to] work together on company problems [but] annual rating of performance, incentive pay, [or] bonuses cannot live with team work. . . What takes the joy out of learning. . .[or out of] anything? Trying to be number one.'" [No Contest, p. 240]

(The question of co-operation and participation within capitalist firms will be discussed in section J.5.12).

Thirdly, there are the benefits associated with increased equality. Studies prove that business performance deteriorates when pay differentials become excessive. In a study of over 100 businesses (producing everything from kitchen appliances to truck axles), researchers found that the greater the wage gap between managers and workers, the lower their product's quality. [Douglas Cowherd and David Levine, "Product Quality and Pay Equity," Administrative Science Quarterly no. 37 (June 1992), pp. 302-30] Businesses with the greatest inequality were plagued with a high employee turnover rate. Study author David Levine said: "These organisations weren't able to sustain a workplace of people with shared goals." [quoted by John Byrne in "How high can CEO pay go?" Business Week, April 22, 1996]

(In fact, the negative effects of income inequality can be seen on a national level as well. Economists Torsten Persson and Guido Tabellini conducted a thorough statistical analysis of historical inequality and growth, and found that nations with more equal incomes generally experience faster productive growth. ["Is Inequality Harmful for Growth?", American Economic Review no. 84, June 1994, pp. 600-21] Numerous other studies have also confirmed their findings. Real life yet again disproves the assumptions of capitalism - inequality harms us all, even the capitalist economy which produces it).

This is to be expected. Workers, seeing an increasing amount of the value they create being monopolised by top managers and a wealthy elite and not re-invested into the company to secure their employment prospects, will hardly be inclined to put in that extra effort or care about the quality of their work. Managers who use the threat of unemployment to extract more effort from their workforce are creating a false economy. While they will postpone decreasing profits in the short term due to this adaptive strategy (and enrich themselves in the process) the pressures placed upon the system will bring a harsh long term effects - both in terms of economic crisis (as income becomes so skewed as to create realisation problems and the limits of adaptation are reached in the face of international competition) and social breakdown.

As would be imagined, co-operative workplaces tend to be more egalitarian than capitalist ones. This is because in capitalist firms, the incomes of top management must be justified (in practice) to a small number of individuals (namely, those shareholders with sizeable stock in the firm), who are usually quite wealthy and so not only have little to lose in granting huge salaries but are also predisposed to see top managers as being very much like themselves and so are entitled to comparable incomes. In contrast, the incomes of top management in worker controlled firms have to be justified to a workforce whose members experience the relationship between management incomes and their own directly and who, no doubt, are predisposed to see their top managers as being workers like themselves and accountable to them. Such an egalitarian atmosphere will have a positive impact on production and efficiency as workers will see that the value they create is not being accumulated by others but distributed according to work actually done (and not control over power). In the Mondragon co-operatives, for example, the maximum pay differential is 14 to 1 (increased from 3 to 1 in a response to outside pressures after much debate, with the actual maximum differential at 9 to 1) while (in the USA) the average CEO is paid over 140 times the average factory worker (up from 41 times in 1960).

Therefore, we see that co-operatives prove (to a greater or lesser extent) the advantages of (and interrelationship between) key anarchist principles such as liberty, equality, solidarity and self-management. Their application, whether all together or in part, has a positive impact on efficiency and work -- and, as we will discuss in section J.5.12, the capitalist market actively blocks the spread of more efficient productive techniques instead of encouraging them. Even by its own standards, capitalism stands condemned - it does not encourage the efficient use of resources and actively places barriers in the development of human "resources."

From all this its clear to see why co-operatives are supported by anarchists. We are "convinced that the co-operative could, potentially, replace capitalism and carries within it the seeds of economic emancipation. . . The workers learn from this precious experience how to organise and themselves conduct the economy without guardian angels, the state or their former employers." [Michael Bakunin, Op. Cit., p. 399] Co-operatives give us a useful insight into the possibilities of a free, socialist, economy. Even within the hierarchical capitalist economy, co-operatives show us that a better future is possible and that production can be organised in a co-operative fashion and that by so doing we can reap the individual and social benefits of working together as equals.

However, this does not mean that all aspects of the co-operative movement find favour with anarchists. As Bakunin pointed out, "there are two kinds of co-operative: bourgeois co-operation, which tends to create a privileged class, a sort of new collective bourgeoisie organised into a stockholding society: and truly Socialist co-operation, the co-operation of the future which for this very reason is virtually impossible of realisation at present." [Op. Cit., p. 385] In other words, while co-operatives are the germ of the future, in the present they are often limited by the capitalist environment they find themselves and narrow their vision to just surviving within the current system.

For most anarchists, the experience of co-operatives has proven without doubt that, however excellent in principle and useful in practice, if they are kept within the narrow circle of "bourgeois" existence they cannot become dominant and free the masses. This point is argued in Section J.5.11 and so will be ignored here. In order to fully develop, co-operatives must be part of a wider social movement which includes community and industrial unionism and the creation of a anarchistic social framework which can encourage "truly Socialist co-operation" and discourage "bourgeois co-operation." As Murray Bookchin correctly argues, "[r]emoved from a libertarian municipalist [or other anarchist] context and movement focused on achieving revolutionary municipalist [or communalist] goals as a dual power against corporations and the state, food [and other forms of] co-ops are little more than benign enterprises that capitalism and the state can easily tolerate with no fear of challenge." [Democracy and Nature no. 9, p. 175]

Therefore, while co-operatives are an important aspect of anarchist ideas and practice, they are not the be all or end all of our activity. Without a wider social movement which creates all (or at least most) of the future society in the shell of the old, co-operatives will never arrest the growth of capitalism or transcend the narrow horizons of the capitalist economy.

J.5.11 If workers really want self-management, why aren't there more producer co-operatives?

Supporters of capitalism suggest that producer co-operatives would spring up spontaneously if workers really wanted them. Their argument is that co-operatives could be financed at first by "wealthy radicals" or by affluent workers pooling their resources to buy out existing capitalist firms; then, if such co-operatives were really economically viable and desired by workers, they would spread until eventually they undermined capitalism. They conclude that since this is not happening, it must be because workers' self-management is either economically unfeasible or is not really attractive to workers or both (see, for example, Robert Nozick, Anarchy, State, and Utopia, pp. 250-52).

David Schweickart has decisively answered this argument by showing that the reason there are not more producer co-operatives is structural:

"A worker-managed firm lacks an expansionary dynamic. When a capitalist enterprise is successful, the owner can increase her profits by reproducing her organisation on a larger scale. She lacks neither the means nor the motivation to expand. Not so with a worker-managed firm. Even if the workers have the means, they lack the incentive, because enterprise growth would bring in new workers with whom the increased proceeds would have to be shared. Co-operatives, even when prosperous, do not spontaneously grow. But if this is so, then each new co-operative venture (in a capitalist society) requires a new wealthy radical or a new group of affluent radical workers willing to experiment. Because such people doubtless are in short supply, it follows that the absence of a large and growing co-operative movement proves nothing about the viability of worker self-management, nor about the preferences of workers." [Against Capitalism, p. 239]

There are other structural problems as well. For one thing, since their pay levels are set by members' democratic vote, co-operatives tend to be more egalitarian in their income structure. But this means that in a capitalist environment, co-operatives are in constant danger of having their most skilled members hired away. Moreover, there is a difficulty in raising capital:

"Quite apart from ideological hostility (which may be significant), external investors will be reluctant to put their money into concerns over which they will have little or no control -- which tends to be the case with a co-operative. Because co-operatives in a capitalist environment face special difficulties, and because they lack the inherent expansionary dynamic of a capitalist firm, it is hardy surprising that they are far from dominant." [Ibid., p 240]

In addition, co-operatives face the negative externalities generated by a capitalist economy. The presence of wage labour and investment capital in the economy will tempt successful co-operatives to increase their flexibility to adjust to changes in market changes by hiring workers or issuing shares to attract new investment. In so doing, however, they may end up losing their identities as co-operatives by diluting ownership or by making the co-operative someone's boss:

"To meet increased production, the producer co-operatives hired outside wage workers. This created a new class of workers who exploit and profit from the labour of their employees. And all this fosters a bourgeois mentality." [Michael Bakunin, Bakunin on Anarchism, p. 399]

Hence the pressures of working in a capitalist market may result in co-operatives pursuing activities which may result in short term gain or survival, but are sure to result in harm in the long run. Far from co-operatives slowly expanding within and changing a capitalist environment it is more likely that capitalist logic will expand into and change the co-operatives that work in it (this can be seen from the Mondragon co-operatives, where there has been a slight rise in the size of wage labour being used and the fact that the credit union, since 1992, has invested in non-co-operative firms). These externalities imposed upon isolated co-operatives within capitalism (which would not arise within a fully co-operative context) block local moves towards anarchism. The idea that co-operation will simply win out in competition within well developed capitalist economic systems is just wishful thinking. Just because a system is more liberatory and just does not mean it will survive in an authoritarian economic and social environment.

There are also cultural problems as well. As Jon Elster points out, it is a "truism, but an important one, that workers' preferences are to a large extent shaped by their economic environment. Specifically, there is a tendency to adaptive preference formation, by which the actual mode of economic organisation comes to be perceived as superior to all others." ["From Here to There", in Socialism, p. 110] In other words, people view "what is" as given and feel no urge to change to "what could be." In the context of creating alternatives within capitalism, this can have serious effects on the spread of alternatives and indicates the importance of anarchists encouraging the spirit of revolt to break down this mental apathy.

This acceptance of "what is" can be seen, to some degree, by some companies which meet the formal conditions for co-operatives, for example ESOP owned firms in the USA, but lack effective workers' control. ESOP (Employee Stack Ownership Plans) firms enable a firms workforce to gain the majority of a companies shares but the unequal distribution of shares amongst employees prevents the great majority of workers from having any effective control or influence on decisions. Unlike real co-operatives (based on "one worker, one vote") these firms are based on "one share, one vote" and so have more in common with capitalist firms than co-operatives.

Moreover, we have ignored such problems as natural barriers to entry into, and movement within, a market (which is faced by all firms) and the difficulties co-operatives can face in finding access to long term credit facilities required by them from capitalist banks (which would effect co-operatives more as short term pressures can result in their co-operative nature being diluted). As Tom Cahill notes, the "old co-ops [of the nineteenth century] also had the specific problem of . . . giving credit . . . [as well as] problems . . . of competition with price cutting capitalist firms, highlighting the inadequate reservoirs of the under-financed co-ops." ["Co-operatives and Anarchism: A contemporary Perspective", in For Anarchism, edited by Paul Goodway, p. 239]

In addition, the "return on capital is limited" in co-operatives [Tom Cahill, Op. Cit., p. 247] which means that investors are less-likely to invest in co-operatives, and so co-operatives will tend to suffer from a lack of investment. Which also suggests that Nozick's argument that "don't say that its against the class interest of investors to support the growth of some enterprise that if successful would end or diminish the investment system. Investors are not so altruistic. They act in personal and not their class interests" is false [Op. Cit., pp. 252-3]. Nozick is correct, to a degree -- but given a choice between high returns from investments in capitalist firms and lower ones from co-operatives, the investor will select the former. This does not reflect the productivity or efficiency of the investment -- quite the reverse! -- it reflects the social function of wage labour in maximising profits and returns on capital (see next section for more on this). In other words, the personal interests of investors will generally support their class interests (unsurprisingly, as class interests are not independent of personal interests and will tend to reflect them!).

Tom Cahill outlines the investment problem when he writes that the "financial problem" is a major reason why co-operatives failed in the past, for "basically the unusual structure and aims of co-operatives have always caused problems for the dominant sources of capital. In general, the finance environment has been hostile to the emergence of the co-operative spirit. . ." And he also notes that they were "unable to devise structuring to maintain a boundary between those who work and those who own or control. . . It is understood that when outside investors were allowed to have power within the co-op structure, co-ops lost their distinctive qualities." [Op. Cit., pp. 238-239] Meaning that even if co-operative do attract investors, the cost of so doing may be to transform the co-operatives into capitalist firms.

Thus, in spite of "empirical studies suggest[ing] that co-operatives are at least as productive as their capitalist counterparts," with many having "an excellent record, superior to conventionally organised firms over a long period" [Jon Elster, Op. Cit., p. 96], co-operatives are more likely to adapt to capitalism than replace it and adopt capitalist principles of rationality in order to survive. All things being equal, co-operatives are more efficient than their capitalist counterparts - but when co-operatives compete in a capitalist economy, all things are not equal.

In spite of these structural and cultural problems, however, there has been a dramatic increase in the number of producer co-operatives in most Western countries in recent years. For example, Saul Estrin and Derek Jones report that co-operatives in the UK grew from 20 in 1975 to 1,600 by 1986; in France they increased from 500 to 1,500; and in Italy, some 7,000 new co-operatives came into existence between 1970 and 1982 ["Can Employee-owned Firms Survive?", Working Paper Series, Department of Economics, Hamilton College (April, May, 1989)]. Italian co-operatives now number well over 20,000, many of them large and having many support structures as well (which aids their development by reducing their isolation and providing long term financial support lacking within the capitalist market).

We have already noted the success of the Mondragon co-operatives in Spain, which created a cluster of inter-locking co-operatives with its own credit union to provide long term financial support and commitment. Thus, in Europe at least, it appears that there is a rather "large and growing co-operative movement," which gives the lie to Nozick's and other supporters of capitalism arguments about co-operatives' lack of economic viability and/or attractiveness to workers.

However, because co-operatives can survive in a capitalist economy it does not automatically mean that they shall replace that economy. Isolated co-operatives, as we argued above, will more likely adapt to capitalist realities than remain completely true to their co-operative promise. For most anarchists, therefore, co-operatives can reach their full potential only as part of a social movement aiming to change society. As part of a wider movement of community and workplace unionism, with mutualist banks to provide long terms financial support and commitment, co-operatives could be communalised into a network of solidarity and support that will reduce the problems of isolation and adaptation. Hence Bakunin:

"We hardly oppose the creation of co-operative associations; we find them necessary in many respects. . . they accustom the workers to organise, pursue, and manage their interests themselves, without interference either by bourgeois capital or by bourgeois control. . . [they must] above all [be] founded on the principle of solidarity and collectivity rather than on bourgeois exclusivity, then society will pass from its present situation to one of equality and justice without too many great upheavals." [Op. Cit., p. 153]

Co-operation "will prosper, developing itself fully and freely, embracing all human industry, only when it is based on equality, when all capital . . . [and] the soil, belong to the people by right of collective property." [Ibid.]

Until then, co-operatives will exist within capitalism but not replace it by market forces - only a social movement and collective action can fully secure their full development. As David Schweickart argues:

"Even if worker-managed firms are preferred by the vast majority, and even if they are more productive, a market initially dominated by capitalist firms may not select for them. The common-sense neo-classical dictum that only those things that best accord with people's desires will survive the struggle of free competition has never been the whole truth with respect to anything; with respect to workplace organisation it is barely a half-truth." [Op. Cit., p. 240]

This means that while anarchists support, create and encourage co-operatives within capitalism, they understand "the impossibility of putting into practice the co-operative system under the existing conditions of the predominance of bourgeois capital in the process of production and distribution of wealth." Because of this, most anarchists stress the need for more combative organisations such as industrial and community unions and other bodies "formed," to use Bakunin's words, "for the organisation of toilers against the privileged world" in order to help bring about a free society. [Michael Bakunin, Op. Cit., p. 185]

J.5.12 If self-management is more efficient, surely capitalist firms will be forced to introduce it by the market?

While it may be admitted that co-operatives cannot reform capitalism away (see last section), many supporters of "free market" capitalism will claim that a laissez-faire system would see workers self-management spread within capitalism. This is because, as self-management is more efficient than wage slavery, those capitalist firms that introduce it will gain a competitive advantage, and so their competitors will be forced to introduce it or go bust. While not being true anarchistic production, it would (it is argued) be a very close approximation of it and so capitalism could reform itself naturally to get rid of (to a large degree) its authoritarian nature.

While such a notion seems plausible in theory, in practice it does not work. Free market capitalism places innumerable barriers to the spread of worker empowering structures within production, in spite (perhaps, as we will see, because) of their more efficient nature. This can be seen from the fact that while the increased efficiency associated with workers' participation and self-management has attracted the attention of many capitalist firms, the few experiments conducted have failed to spread. This is due, essentially, to the nature of capitalist production and the social relationships it produces.

As we noted in section D.10, capitalist firms (particularly in the west) made a point of introducing technologies and management structures that aimed to deskill and disempower their workers. In this way, it was hoped to make the worker increasingly subject to "market discipline" (i.e. easier to train, so increasing the pool of workers available to replace any specific worker and so reducing workers power by increasing management's power to fire them). Of course, what actually happens is that after a short period of time while management gained the upper hand, the workforce found newer and more effective ways to fight back and assert their productive power again. While for a short time the technological change worked, over the longer period the balance of forces changed, so forcing management to continually try to empower themselves at the expense of the workforce.

It is unsurprising that such attempts to reduce workers to order-takers fail. Workers' experiences and help are required to ensure production actually happens at all. When workers carry out their orders strictly and faithfully (i.e. when they "work to rule") production threatens to stop. So most capitalists are aware of the need to get workers to "co-operate" within the workplace to some degree. A few capitalist companies have gone further. Seeing the advantages of fully exploiting (and we do mean exploiting) the experience, skills, abilities and thoughts of their employers which the traditional authoritarian capitalist workplace denies them, some have introduced various schemes to "enrich" and "enlarge" work, increase "co-operation" between workers and their bosses. In other words, some capitalist firms have tried to encourage workers to "participate" in their own exploitation by introducing (in the words of Sam Dolgoff) "a modicum of influence, a strictly limited area of decision-making power, a voice - at best secondary - in the control of conditions of the workplace." [The Anarchist Collectives, p. 81] The management and owners still have the power and still reap the majority of benefits from the productive activity of the workforce.

David Noble provides a good summary of the problems associated with experiments in workers' self-management within capitalist firms:

"Participant in such programs can indeed be a liberating and exhilarating experience, awakening people to their own untapped potential and also to the real possibilities of collective worker control of production. As one manager described the former pilots [workers in a General Electric program]: 'These people will never be the same again. They have seen that things can be different.' But the excitement and enthusiasm engendered by such programs, as well as the heightened sense of commitment to a common purpose, can easily be used against the interests of the work force. First, that purpose is not really 'common' but is still determined by management alone, which continues to decide what will be produced, when, and where. Participation in production does not include participation in decisions on investment, which remains the prerogative of ownership. Thus participation is, in reality, just a variation of business as usual -- taking orders -- but one which encourages obedience in the name of co-operation.

"Second, participation programs can contribute to the creation of an elite, and reduced, work force, with special privileges and more 'co-operative' attitudes toward management -- thus at once undermining the adversary stance of unions and reducing membership . . .

"Thirds, such programs enable management to learn from workers -- who are now encouraged by their co-operative spirit to share what they know -- and, then, in Taylorist tradition, to use this knowledge against the workers. As one former pilot reflected, 'They learned from the guys on the floor, got their knowledge about how to optimise the technology and then, once they had it, they eliminated the Pilot Program, put that knowledge into the machines, and got people without any knowledge to run them -- on the Company's terms and without adequate compensation. They kept all the gains for themselves.'" . . .

"Fourth, such programs could provide management with a way to circumvent union rules and grievance procedures or eliminate unions altogether. . ." [Forces of Production, pp. 318-9]

However, be that as it may, the results of such capitalist experiments in "workers' control" are interesting and show why self-management will not spread by market forces (and they also bear direct relevance to the question of why real co-operatives are not widespread within capitalism -- see last section).

According to one expert "[t]here is scarcely a study in the entire literature which fails to demonstrate that satisfaction in work is enhanced or. . .productivity increases occur from a genuine increase in worker's decision-making power. Findings of such consistency, I submit, are rare in social research." [Paul B. Lumberg, cited by Hebert Gintiz, "The nature of Labour Exchange and the Theory of Capitalist Production", Radical Political Economy vol. 1, p. 252]

In spite of these findings, a "shift toward participatory relationships is scarcely apparent in capitalist production. . . [this is] not compatible with the neo-classical assertion as to the efficiency of the internal organisation of capitalist production." [Herbert Gintz, Op. Cit., p. 252] Why is this the case?

Economist William Lazonick indicates the reason when he writes that "[m]any attempts at job enrichment and job enlargement in the first half of the 1970s resulted in the supply of more and better effort by workers. Yet many 'successful' experiments were cut short when the workers whose work had been enriched and enlarged began questioning traditional management prerogatives inherent in the existing hierarchical structure of the enterprise." [Competitive Advantage on the Shop Floor, p. 282]

This is an important result, as it indicates that the ruling sections within capitalist firms have a vested interest in not introducing such schemes, even though they are more efficient methods of production. As can easily be imagined, managers have a clear incentive to resist participatory schemes (and David Schweickart notes, such resistance, "often bordering on sabotage, is well known and widely documented" [Against Capitalism, p. 229]). As an example of this, David Noble discusses a scheme (called the Pilot Program) ran by General Electric at Lynn, Massachusetts, USA in the late 1960s:

"After considerable conflict, GE introduced a quality of work life program . . . which gave workers much more control over the machines and the production process and eliminated foremen. Before long, by all indicators, the program was succeeding -- machine use, output and product quality went up; scrap rate, machine downtime, worker absenteeism and turnover when down, and conflict on the floor dropped off considerably. Yet, little more than a year into the program -- following a union demand that it be extended throughout the shop and into other GE locations -- top management abolished the program out of fear of losing control over the workforce. Clearly, the company was willing to sacrifice gains in technical and economic efficiency in order to regain and insure management control." [Progress Without People, p. 65f]

This is for three reasons.

Firstly, the fact is that within "free market" capitalism keeping (indeed strengthening) skills and power in the hands of the workers makes it harder for a capitalist firm to maximise profits (i.e. unpaid labour). It strengthens the power of workers, who can use that power to gain increased wages (i.e. reduce the amount of surplus value they produce for their bosses).

Workers' control basically leads to a usurpation of capitalist prerogatives -- including their share of revenues and their ability to extract more unpaid labour during the working day. While in the short run workers' control may lead to higher productivity (and so may be toyed with), in the long run, it leads to difficulties for capitalists to maximise their profits. So, "given that profits depend on the integrity of the labour exchange, a strongly centralised structure of control not only serves the interests of the employer, but dictates a minute division of labour irrespective of considerations of productivity. For this reason, the evidence for the superior productivity of 'workers control' represents the most dramatic of anomalies to the neo-classical theory of the firm: worker control increases the effective amount of work elicited from each worker and improves the co-ordination of work activities, while increasing the solidarity and delegitimising the hierarchical structure of ultimate authority at its root; hence it threatens to increase the power of workers in the struggle over the share of total value." [Hebert Gintz, Op. Cit., p. 264]

So, a workplace which had extensive workers participation would hardly see the workers agreeing to reduce their skill levels, take a pay cut or increase their pace of work simply to enhance the profits of capitalists. Simply put, profit maximisation is not equivalent to technological efficiency. By getting workers to work longer, more intensely or in more unpleasant conditions can increase profits but does not yield more output for the same inputs. Workers' control would curtail capitalist means of enhancing profits by changing the quality and quantity of work. It is this requirement which also aids in understanding why capitalists will not support workers' control -- even though it is more efficient, it reduces the ability of capitalists to maximise profits by minimising labour costs. Moreover, demands to change the nature of workers' inputs into the production process in order to maximise profits for capitalists would provoke a struggle over the time and intensity of work and over the share of value added going to workers, management and owners and so destroy the benefits of participation.

Thus power within the workplace plays a key role in explaining why workers' control does not spread -- it reduces the ability of bosses to extract more unpaid labour from workers.

The second reason is related to the first. It too is based on the power structure within the company but the power is related to control over the surplus produced by the workers rather than the ability to control how much surplus is produced in the first place (i.e. power over workers).

Hierarchical management is the way to ensure that profits are channelled into the hands of a few. By centralising power, the surplus value produced by workers can be distributed in a way which benefits those at the top (i.e. management and capitalists). Profit maximisation under capitalism means the maximum profits available for capitalists -- not the maximum difference between selling price and cost as such. This difference explains the strange paradox of workers' control experiments being successful but being cancelled by management. The paradox is easily explained once the hierarchical nature of capitalist production (i.e. of wage labour) is acknowledged. Workers' control, by placing (some) power in the hands of workers, undermines the authority of management and, ultimately, their power to control the surplus produced by workers and allocate it as they see fit. Thus, while workers' control does reduce costs, increase efficiency and productivity (i.e. maximise the difference between prices and costs) it (potentially) reduces profit maximisation by undermining the power (and so privileges) of management to allocate that surplus as they see fit.

Increased workers' control reduces the capitalists potential to maximise their profits and so will be opposed by both management and owners. Indeed, it can be argued that hierarchical control of production exists solely to provide for the accumulation of capital in a few hands, not for efficiency or productivity (see Stephan A. Margin, "What do Bosses do? The Origins and Functions of Hierarchy in Capitalist Production", Op. Cit., pp. 178-248). This is why profit maximisation does not entail efficiency and can actively work against it.

As David Noble argues, power is the key to understanding capitalism, not the drive for profits as such:

"In opting for control [over the increased efficiency of workers' control] . . . management . . . knowingly and, it must be assumed, willingly, sacrificed profitable production. Hence [experiences such as] the Pilot Program [at GE] . . . illustrates not only the ultimate management priority of power over both production and profit within the firm, but also the larger contradiction between the preservation of private power and prerogatives, on the one hand, and the social goals of efficient, quality, and useful production, on the other . . .

"It is a common confusion, especially on the part of those trained in or unduly influenced by formal economics (liberal and Marxist alike), that capitalism is a system of profit-motivated, efficient production. This is not true, nor has it ever been. If the drive to maximise profits, through private ownership and control over the process of production, it has never been the end of that development. The goal has always been domination (and the power and privileges that go with it) and the preservation of domination. There is little historical evidence to support the view that, in the final analysis, capitalists play by the rules of the economic game imagined by theorists. There is ample evidence to suggest, on the other hand, that when the goals of profit-making and efficient production fail to coincide with the requirements of continued dominance, capital will resort to more ancient means: legal, political, and, of need be, military. Always, behind all the careful accounting, lies the threat of force. This system of domination has been legitimated in the past by the ideological invention that private ownership of the means of production and the pursuit of profit via production are always ultimately beneficial to society. Capitalism delivers the goods, it is argued, better, more cheaply, and in larger quantity, and in so doing, fosters economic growth . . . The story of the Pilot Program -- and it is but one among thousands like it in U.S. industry -- raises troublesome questions about the adequacy of this mythology as a description of reality." [Forces of Production, pp. 321-2]

Hierarchical organisation (i.e. domination) is essential to ensure that profits are controlled by a few and can, therefore, be allocated by them in such a way to ensure their power and privileges. By undermining management authority, workers' control undermines that power to maximise profits in a certain direction even though it increases "profits" (the difference between prices and costs) in the abstract. As workers' control starts to extend (or management sees its potential to spread) into wider areas such as investment decisions, how to allocate the surplus (i.e. profits) between wages, investment, dividends, management pay and so on, then they will seek to end the project in order to ensure their power over both the workers and the surplus they, the workers, produce. In this they will be supported by those who actually own the company who obviously would not support a regime which will not ensure the maximum return on their investment. This maximum return would be endangered by workers' control, even though it is technically more efficient, as control over the surplus rests with the workers and not a management elite with similar interests and aims as the owners -- an egalitarian workplace would produce an egalitarian distribution of surplus, in other words (as proven by the experience of workers' co-operatives). In the words of one participant of the GE workers' control project -- "If we're all one, for manufacturing reasons, we must share in the fruits equitably, just like a co-op business." [quoted by Noble, Op. Cit., p. 295] Such a possibility is one no owner would agree to.

Thirdly, to survive within the "free" market means to concentrate on the short term. Long terms benefits, although greater, are irrelevant. A free market requires profits now and so a firm is under considerable pressure to maximise short-term profits by market forces (a similar situation occurs when firms invest in "green" technology, see section E.5).

Participation requires trust, investment in people and technology and a willingness to share the increased value added that result from workers' participation with the workers who made it possible. All these factors would eat into short term profits in order to return richer rewards in the future. Encouraging participation thus tends to increase long term gains at the expense of short-term ones (for it ensures that workers do not consider participation as a con, they must experience real benefits in terms of power, conditions and wage rises). For firms within a free market environment, they are under pressure from share-holders and their financiers for high returns as soon as possible. If a company does not produce high dividends then it will see its stock fall as shareholders move to those companies that do. Thus the market forces companies (and banks, who in turn loan over the short term to companies) to act in such ways as to maximise short term profits.

If faced with a competitor which is not making such investments (and which is investing directly into deskilling technology or intensifying work loads which lowers their costs) and so wins them market share, or a downturn in the business cycle which shrinks their profit margins and makes it difficult for the firm to meet its commitments to its financiers and workers, a company that intends to invest in people and trust will usually be rendered unable to do so. Faced with the option of empowering people in work or deskilling them and/or using the fear of unemployment to get workers to work harder and follow orders, capitalist firms have consistently chosen (and probably preferred) the latter option (as occurred in the 1970s).

Thus, workers' control is unlikely to spread through capitalism because it entails a level of working class consciousness and power that is incompatible with capitalist control. In other words, "[i]f the hierarchical division of labour is necessary for the extraction of surplus value, then worker preferences for jobs threatening capitalist control will not be implemented." [Hebert Gintiz, Op. Cit., p. 253] The reason why it is more efficient, ironically, ensures that a capitalist economy will not select it. The "free market" will discourage empowerment and democratic workplaces, at best reducing "co-operation" and "participation" to marginal issues (and management will still have the power of veto).

In addition, moves towards democratic workplaces within capitalism is an example of the system in conflict with itself -- pursuing its objectives by methods which constantly defeat those same objectives. As Paul Carden argues, the "capitalist system can only maintain itself by trying to reduce workers into mere order-takers. . . At the same time the system can only function as long as this reduction is never achieved. . . [for] the system would soon grind to a halt. . . [However] capitalism constantly has to limit this participation (if it didn't the workers would soon start deciding themselves and would show in practice now superfluous the ruling class really is)." [Revolution and Modern Capitalism, pp. 45-46]

The experience of the 1970s supports this thesis well. Thus "workers' control" within a capitalist firm is a contradictory thing - too little power and it is meaningless, too much and workplace authority structures and short-term profits (i.e. capitalist share of value added) can be harmed. Attempts to make oppressed, exploited and alienated workers work if they were neither oppressed, exploited nor alienated will always fail.

For a firm to establish committed and participatory relations internally, it must have external supports - particularly with providers of finance (which is why co-operatives benefit from credit unions and co-operating together). The price mechanism proves self-defeating to create such supports and that is why we see "participation" more fully developed within Japanese and German firms (although it is still along way from fully democratic workplaces), who have strong, long term relationships with local banks and the state which provides them with the support required for such activities. As William Lazonick notes, Japanese industry had benefited from the state ensuring "access to inexpensive long-term finance, the sine qua non of innovating investment strategies" along with a host of other supports, such as protecting Japanese industry within their home markets so they could "develop and utilise their productive resources to the point where they could attain competitive advantage in international competition." [Op. Cit., p. 305] The German state provides its industry with much of the same support.

Therefore, "participation" within capitalist firms will have little or no tendency to spread due to the "automatic" actions of market forces. In spite of such schemes being more efficient, capitalism will not select them because they empower workers and make it hard for capitalists to maximise their short term profits. Hence capitalism, by itself, will have no tendency to produce more libertarian organisational forms within industry. Those firms that do introduce such schemes will be the exception rather than the rule (and the schemes themselves will be marginal in most respects and subject to veto from above). For such schemes to spread, collective action is required (such as state intervention to create the right environment and support network or -- from an anarchist point of view -- union and community direct action).

However such schemes, as noted above, are just forms of self-exploitation, getting workers to help their robbers and so not a development anarchists seek to encourage. We have discussed this here just to be clear that, firstly, such forms of structural reforms are not self-management, as managers and owners still have the real power, and, secondly, even if such forms are somewhat liberatory, market forces will not select them (i.e. collective action would be required).

For anarchists "self-management is not a new form of mediation between workers and their bosses . . . [it] refers to the very process by which the workers themselves overthrow their managers and take on their own management and the management of production in their own workplace." [Sam Dolgoff, Op. Cit., p. 81] Hence our support for co-operatives, unions and other self-managed structures created and organised from below by and for working class people.

J.5.13 What are Modern Schools?

Modern schools are alternative schools, self-managed by students, teachers and parents which reject the authoritarian schooling methods of the modern "education" system. Such schools have a feature of the anarchist movement since the turn of the 20th century while interest in libertarian forms of education has been a feature of anarchist theory from the beginning. All the major anarchist thinkers, from Godwin through Proudhon, Bakunin and Kropotkin to modern activists like Colin Ward, have stressed the importance of libertarian (or "rational") education, education that develops all aspects of the student (mental and physical -- and so termed "integral" education) as well as encouraging critical thought and mental freedom. The aim of such education is, to use Proudhon's words, ensure that the "industrial worker, the man [sic!] of action and the intellectual would all be rolled into one" [cited by Steward Edward in The Paris Commune, p. 274]

Anyone involved in radical politics, constantly and consistently challenges the role of the state's institutions and their representatives within our lives. The role of bosses, the police, social workers, the secret service, middle managers, doctors and priests are all seen as part of a hierarchy which exists to keep us, the working class, subdued. It is relatively rare though for the left-wing to call into question the role of teachers. Most left wing activists and a large number of libertarians believe that education is good, all education is good, and education is always good. As Henry Barnard, the first US commissioner of education, appointed in 1867, exhorted, "education always leads to freedom".

Those involved in libertarian education believe the contrary. They believe that national education systems exist only to produce citizens who'll be blindly obedient to the dictates of the state, citizens who will uphold the authority of government even when it runs counter to personal interest and reason, wage slaves who will obey the orders of their boss most of the time and consider being able to change bosses as freedom. They agree with William Godwin (one of the earliest critics of national education systems) when he wrote in An Enquiry Concerning Political Justice that "the project of a national education ought to be discouraged on account of its obvious alliance with national government . . . Government will not fail to employ it to strengthen its hand and perpetuate its institutions. . .Their views as instigator of a system will not fail to be analogous to their views in their political capacity." [cited by Colin Ward, Anarchy in Action, p. 81]

With the growth of industrialism in the 19th century schools triumphed, not through a desire to reform but as an economic necessity. Industry did not want free thinking individuals, it wanted workers, instruments of labour, and it wanted them punctual, obedient, passive and willing to accept their disadvantaged position. According to Nigel Thrift, many employers and social reformers became convinced that the earliest generations of workers were almost impossible to discipline (i.e. to get accustomed to wage labour and workplace authority). They looked to children, hoping that "the elementary school could be used to break the labouring classes into those habits of work discipline now necessary for factory production. . . Putting little children to work at school for very long hours at very dull subjects was seen as a positive virtue, for it made them habituated, not to say naturalised, to labour and fatigue." [quoted by Juliet B. Schor in The Overworked American, p. 61]

Thus supporters of Modern Schools recognise that the role of education is an important one in maintaining hierarchical society -- for government and other forms of hierarchy (such as wage labour) must always depend on the opinion of the governed. Franciso Ferrer (the most famous supporter of Modern Schooling due to his execution by the Spanish state in 1909) argued that:

"Rulers have always taken care to control the education of the people. They know their power is based almost entirely on the school and they insist on retaining their monopoly. The school is an instrument of domination in the hands of the ruling class." [cited by Clifford Harper, Anarchy: A Graphic Guide, p. 100]

Little wonder, then, that Emma Goldman argued that the "modern method of education" has "little regard for personal liberty and originality of thought. Uniformity and imitation is [its] motto" and that the school "is for the child what the prison is for the convict and the barracks for the solder - a place where everything is being used to break the will of the child, and then to pound, knead, and shape it into a being utterly foreign to itself." [Red Emma Speaks, p. 118, p. 116]

Hence the importance of Modern Schools. It is a means of spreading libertarian education within a hierarchical society and undercut one of the key supports for that society -- the education system. Instead of hierarchical education, Modern schools exist to "develop the individual through knowledge and the free play of characteristic traits, so that [the child] may become a social being, because he had learned to know himself [or herself], to know his [or her] relation to his fellow[s]. . . " [Emma Goldman, Op. Cit., p. 121] It would, in Stirner's words, be "an education for freedom, not for subservience."

The Modern School Movement (also known as the Free School Movement) over the past century has been an attempt to represent part of this concern about the dangers of state and church schools and the need for libertarian education. The idea of libertarian education is that knowledge and learning should be linked to real life processes and personal usefulness and should not be the preserve of a special institution. Thus Modern Schools are an attempt to establish an environment for self development in an overly structured and rationalised world. An oasis from authoritarian control and as a means of passing on the knowledge to be free.

"The underlying principle of the Modern School is this: education is a process of drawing out, not driving in; it aims at the possibility that the child should be left free to develop spontaneously, directing his [or her] own efforts and choosing the branches of knowledge which he desires to study. . . the teacher . . . should be a sensitive instrument responding to the needs of the child . . . a channel through which the child may attain so much of the ordered knowledge of the world as he shows himself [or herself] ready to receive and assimilate". [Emma Goldman, Op. Cit., p. 126]

The Modern School bases itself on libertarian education techniques. Libertarian education, very broadly, seeks to produce children who will demand greater personal control and choice, who think for themselves and question all forms of authority:

"We don't hesitate to say we want people who will continue to develop. People constantly capable of destroying and renewing their surroundings and themselves: whose intellectual independence is their supreme power, which they will yield to none; always disposed for better things, eager for the triumph of new ideas, anxious to crowd many lives into the life they have. It must be the aim of the school to show the children that there will be tyranny as long as one person depends on another." [Ferrer, quoted by Clifford Harper, Op. Cit., p. 100]

Thus the Modern School insists that the child is the centre of gravity in the education process -- and that education is just that, not indoctrination:

"I want to form a school of emancipation, concerned with banning from the mind whatever divides people, the false concepts of property, country and family so as to attain the liberty and well-being which all desire. I will teach only simple truth. I will not ram dogma into their heads. I will not conceal one iota of fact. I will teach not what to think but how to think." [Ferrer, cited by Harper, Op. Cit., pp. 99-100]

The Modern School has no rewards or punishments, exams or mark -- the everyday "tortures" of conventional schooling. And because practical knowledge is more useful than theory, lessons were often held in factories, museums or the countryside. The school was also used by the parents, and Ferrer planned a Popular University.

"Higher education, for the privileged few, should be for the general public, as every human has a right to know; and science, which is produced by observers and workers of all countries and ages, ought not be restricted to class." [Ferrer, cited by Harper, Op. Cit., p. 100]

Thus Modern Schools are based on encouraging self-education in a co-operative, egalitarian and libertarian atmosphere in which the pupil (regardless of age) can develop themselves and their interests to the fullest of their abilities. In this way Modern Schools seek to create anarchists by a process of education which respects the individual and gets them to develop their own abilities in a conducive setting.

Modern Schools have been a constant aspect of the anarchist movement since the later 1890s. The movement was started in France by Louise Michel and Sebastien Faure, where Franciso Ferrer became acquainted with them. He founded his Modern School in Barcelona in 1901, and by 1905 there were 50 similar schools in Spain (many of them funded by anarchist groups and trade unions and, from 1919 onward, by the C.N.T. -- in all cases the autonomy of the schools was respected). In 1909, Ferrer was falsely accused by the Spanish government of leading an insurrection and executed in spite of world-wide protest and overwhelming proof of his innocence. His execution, however, gained him and his educational ideas international recognition and inspired a Modern School progressive education movement in Britain, France, Belgium, Holland, Italy, Germany, Switzerland, Poland, Czechoslovakia, Yugoslavia, Argentina, Brazil, Mexico, China, Japan and, on the greatest scale, in the USA.

However, for most anarchists, Modern Schools are not enough in themselves to produce a libertarian society. They agree with Bakunin's argument that

"Does this environment exist? No. Then it must be established. . . [otherwise] in the existing social environment . . . on leaving [libertarian] schools they [the student] would enter a society governed by totally opposite principles, and, because society is always stronger than individuals, it would prevail over them . . . [and] demoralise them." [The Basic Bakunin, p, 174]

Because of this, Modern Schools must be part of a mass working class revolutionary movement which aims to build as many aspects of the new world as possible in the old one before, ultimately, replacing it. Otherwise they are just useful as social experiments and their impact on society marginal. Little wonder, then, that Bakunin supported the International Workers Association's resolution that urged "the various sections [of the International] to establish public courses . . . [based on] all-round instruction, in order to remedy as much as possible the insufficient education that workers currently receive." [quoted by Bakunin, Op. Cit., p. 175]

Thus, for anarchists, this process of education is part of the class struggle, not in place of it and so "the workers [must] do everything possible to obtain all the education they can in the material circumstances in which they currently find themselves . . . [while] concentrat[ing] their efforts on the great question of their economic emancipation, the mother of all other emancipations." [Michael Bakunin, Op. Cit., p. 175]

Before finishing, we must stress that hierarchical education (like the media), cannot remove the effects of actual life and activity in shaping/changing people and their ideas, opinions and attitudes. While education is an essential part of maintaining the status quo and accustoming people to accept hierarchy, the state and wage slavery, it cannot stop individuals from learning from their experiences, ignoring their sense of right and wrong, recognising the injustices of the current system and the ideas that it is based upon. This means that even the best state (or private) education system will still produce rebels -- for the experience of wage slavery and state oppression (and, most importantly, struggle) is shattering to the ideology spoon-fed children during their "education" and reinforced by the media.

For more information on Modern Schools see Paul Avrich's The Modern School Movement: Anarchism and education in the United States, Emma Goldman's essay "Francisco Ferrer and the Modern School" in Anarchism and Other Essays and A.S Neil's Summerhill. For a good introduction to anarchist viewpoints on education see "Kropotkin and technical education: an anarchist voice" by Michael Smith in For Anarchism and Michael Bakunin's "All-Round Education" in The Basic Bakunin. For an excellent summary of the advantages and benefits of co-operative learning, see Alfie Kohn's No Contest.

J.5.14 What is Libertarian Municipalism?

In his article "Theses on Libertarian Municipalism" [in The Anarchist Papers, Black Rose Press, 1986], Murray Bookchin has proposed a non-parliamentary electoral strategy for anarchists. He has repeated this proposal in many of his later works, such as From Urbanisation to Cities and has made it -- at least in the USA -- one of the many alternatives anarchists are involved in. The main points of his argument are summarised below, followed by a brief commentary.

According to Bookchin, "the proletariat, as do all oppressed sectors of society, comes to life when it sheds its industrial habits in the free and spontaneous activity of communising, or taking part in the political life of the community." In other words, Bookchin thinks that democratisation of local communities may be as strategically important, or perhaps more important, to anarchists than workplace struggles.

Since local politics is humanly scaled, Bookchin argues that it can be participatory rather than parliamentary. Or, as he puts it, "[t]he anarchic ideal of decentralised, stateless, collectively managed, and directly democratic communities -- of confederated municipalities or 'communes' -- speaks almost intuitively, and in the best works of Proudhon and Kropotkin, consciously, to the transforming role of libertarian municipalism as the framework of a liberatory society. . . " He also points out that, historically, the city has been the principle countervailing force to imperial and national states, haunting them as a potential challenge to centralised power and continuing to do so today, as can be seen in the conflicts between national government and municipalities in many countries.

But, despite the libertarian potential of urban politics, "urbanisation" -- the growth of the modern megalopolis as a vast wasteland of suburbs, shopping malls, industrial parks, and slums that foster political apathy and isolation in realms of alienated production and private consumption -- is antithetical to the continued existence of those aspects of the city that might serve as the framework for a libertarian municipalism. "When urbanisation will have effaced city life so completely that the city no longer has its own identity, culture, and spaces for consociation, the bases for democracy -- in whatever way the word in defined -- will have disappeared and the question of revolutionary forms will be a shadow game of abstractions."

Despite this danger, however, Bookchin thinks that a libertarian politics of local government is still possible, provided anarchists get their act together. "The Commune still lies buried in the city council; the sections still lie buried in the neighbourhood; the town meeting still lies buried in the township; confederal forms of municipal association still lie buried in regional networks of towns and cities."

What would anarchists do electorally at the local level? Bookchin proposes that they change city and town charters to make political institutions participatory. "An organic politics based on such radical participatory forms of civic association does not exclude the right of anarchists to alter city and town charters such that they validate the existence of directly democratic institutions. And if this kind of activity brings anarchists into city councils, there is no reason why such a politics should be construed as parliamentary, particularly if it is confined to the civic level and is consciously posed against the state."

In a latter essay, Bookchin argues that Libertarian Muncipalism "depends upon libertarian leftists running candidates at the local level, calling for the division of municipalities into wards, where popular assemblies can be created that bring people into full and direct participation in political life . . . municipalities would [then] confederate into a dual power to oppose the nation-state and ultimately dispense with it and with the economic forces that underpin statism as such." [Democracy and Nature no. 9, p. 158] This would be part of a social wide transformation, whose "[m]inimal steps . . . include initiating Left Green municipalist movements that propose neighbourhood and town assemblies - even if they have only moral functions at first - and electing town and city councillors that advance the cause of these assemblies and other popular institutions. These minimal steps can lead step-by-step to the formation of confederal bodies. . . Civic banks to fund municipal enterprises and land purchases; the fostering of new ecologically-orientated enterprises that are owned by the community. . ." [From Urbanisation to Cities, p. 266]

Thus Bookchin sees Libertarian Muncipalism as a process by which the state can be undermined by using elections as the means of creating popular assemblies. Part of this process, he argues, would be the "municipalisation of property" which would "bring the economy as a whole into the orbit of the public sphere, where economic policy could be formulated by the entire community." [Op. Cit. p. 235]

Bookchin considers Libertarian Muncipalism as the key means of creating an anarchist society, and argues that those anarchists who disagree with it are failing to take their politics seriously. "It is curious," he notes, "that many anarchists who celebrate the existence of a 'collectivised' industrial enterprise, here and there, with considerable enthusiasm despite its emergence within a thoroughly bourgeois economic framework, can view a municipal politics that entails 'elections' of any kind with repugnance, even if such a politics is structured around neighbourhood assemblies, recallable deputies, radically democratic forms of accountability, and deeply rooted localist networks." ["Theses on Libertarian Municipalism"]

In evaluating Bookchin's proposal, several points come to mind.

Firstly, it is clear that Libertarian Muncipalism's arguments in favour of community assemblies is important and cannot be ignored. Bookchin is right to note that, in the past, many anarchists placed far too much stress on workplace struggles and workers' councils as the framework of a free society. Many of the really important issues that affect us cannot be reduced to workplace organisations, which by their very nature disenfranchise those who do not work in industry (such as housewives, the old, and so on). And, of course, there is far more to life than work and so any future society organised purely around workplace organisations is reproducing capitalism's insane glorification of economic activity, at least to some degree. So, in this sense, Libertarian Muncipalism has a very valid point -- a free society will be created and maintained within the community as well as in the workplace.

Secondly, Bookchin and other Libertarian Muncipalists are totally correct to argue that anarchists should work in their local communities. As noted in section J.5.1, many anarchists are doing just that and are being very successful as well. However, most anarchists reject the idea that using elections are a viable means of "struggle toward creating new civic institutions out of old ones (or replacing the old ones altogether)." [From Urbanisation to Cities, p. 267]

The most serious problem has to do with whether politics in most cities has already become too centralised, bureaucratic, inhumanly scaled, and dominated by capitalist interests to have any possibility of being taken over by anarchists running on platforms of participatory democratisation. Merely to pose the question seems enough to answer it. There is no such possibility in the vast majority of cities, and hence it would be a waste of time and energy for anarchists to support libertarian municipalist candidates in local elections -- time and energy that could be more profitably spent in direct action. If the central governments are too bureaucratic and unresponsive to be used by Libertarian Municipalists, the same can be said of local ones too.

The counter-argument to this is that even if there is no chance of such candidates being elected, their standing for elections would serve a valuable educational function. The answer to this is: perhaps, but would it be more valuable than direct action? And would its educational value, if any, outweigh the disadvantages of electioneering mentioned in sections J.2.2 and J.2.4, such as the fact that voting ratifies the current system? Given the ability of major media to marginalise alternative candidates, we doubt that such campaigns would have enough educational value to outweigh these disadvantages. Moreover, being an anarchist does not make one immune to the corrupting effects of electioneering (as highlighted in section J.2.6). History is littered with radical, politically aware movements using elections and ending up becoming part of the system they aimed to transform. Most anarchists doubt that Libertarian Muncipalism will be any different -- after all, it is the circumstances the parties find themselves in which are decisive, not the theory they hold (the social relations they face will transform the theory, not vice versa, in other words).

Lastly, most anarchists question the whole process on which Libertarian Muncipalism bases itself on. The idea of communes is a key one of anarchism and so strategies to create them in the here and now are important. However, to think that using alienated, representative institutions to abolish these institutions is mad. As the Italian activists (who organised a neighbourhood assembly by non-electoral means) argue, "[t]o accept power and to say that the others were acting in bad faith and that we would be better, would force non-anarchists towards direct democracy. We reject this logic and believe that organisations must come from the grassroots." ["Community Organising in Southern Italy", pp. 16-19, Black Flag no. 210, p. 18]

Thus Libertarian Municipalism reverses the process by which community assemblies will be created. Instead of anarchists using elections to build such bodies, they must work in their communities directly to create them (see section J.5.1 - "What is Community Unionism?" for more details). Using the catalyst of specific issues of local interest, anarchists could propose the creation of a community assembly to discuss the issues in question and organise action to solve them. Instead of a "confederal muncipalist movement run[ning] candidates for municipal councils with demands for the institution of public assemblies" [Murray Bookchin, Op. Cit., p. 229] anarchists should encourage people to create these institutions themselves and empower themselves by collective self-activity. As Kropotkin argued, "Laws can only follow the accomplished facts; and even if they do honestly follow them - which is usually not the case - a law remains a dead letter so long as there are not on the spot the living forces required for making the tendencies expressed in the law an accomplished fact." [Kropotkin's Revolutionary Pamphlets, p. 171] Most anarchists, therefore, think it is far more important to create the "living forces" within our communities directly than waste energy in electioneering and the passing of laws creating or "legalising" community assemblies. In other words, community assemblies can only be created from the bottom up, by non-electoral means, a process which Libertarian Muncipalism confuses with electioneering.

So, while Libertarian Muncipalism does raise many important issues and correctly stresses the importance of community activity and self-management, its emphasis on electoral activity undercuts its liberatory promise. For most anarchists, community assemblies can only be created from below, by direct action, and (because of its electoral strategy) a Libertarian Municipalist movement will end up being transformed into a copy of the system it aims to abolish.

J.5.15 What attitude do anarchists take to the welfare state?

Currently we are seeing a concerted attempt to rollback the state within society. This has been begun by the right-wing in the name of "freedom," "individual dignity and responsibility" and "efficiency." The position of anarchists to this process is mixed. On the one hand, we are all in favour of reducing the size of the state and increasing individual responsibility and freedom, but, on the other, we are well aware that this process is part of an attack on the working class and tends to increase the power of the capitalists over us as the state's (direct) influence is reduced. Thus anarchists appear to be on the horns of a dilemma -- or, at least, apparently.

So what attitude do anarchists take to the welfare state and the current attacks on it? (see next section for a short discussion of business based welfare)

First we must note that this attack of "welfare" is somewhat selective. While using the rhetoric of "self-reliance" and "individualism," the practitioners of these "tough love" programmes have made sure that the major corporations continue to get state hand-outs and aid while attacking social welfare. In other words, the current attack on the welfare state is an attempt to impose market discipline on the working class while increasing state protection for the ruling class. Therefore, most anarchists have no problem in social welfare programmes as these can be considered as only fair considering the aid the capitalist class has always received from the state (both direct subsidies and protection and indirect support via laws that protect property and so on). And, for all their talk of increasing individual choice, the right-wing remain silent about the lack of choice and individual freedom during working hours within capitalism.

Secondly, most of the right-wing inspired attacks on the welfare state are inaccurate. For example, Noam Chomsky notes that the "correlation between welfare payments and family life is real, though it is the reverse of what is claimed [by the right]. As support for the poor has declined, unwed birth-rates, which had risen steadily from the 1940s through the mid-1970s, markedly increased. 'Over the last three decades, the rate of poverty among children almost perfectly correlates with the birth-rates among teenage mothers a decade later,' Mike Males points out: 'That is, child poverty seems to lead to teenage childbearing, not the other way around.'" ["Rollback III", Z Magazine, April, 1995] The same can be said for many of the claims about the evil effects of welfare which the rich and large corporations wish to save others (but not themselves) from. Such altruism is truly heart warming.

Thirdly, we must note that while most anarchists are in favour of collective self-help and welfare, we are opposed to the welfare state. Part of the alternatives anarchists try and create are self-managed and communal community welfare projects (see next section). Moreover, in the past, anarchists and syndicalists were at the forefront in opposing state welfare schemes (introduced, we may note, not by socialists but by liberals and other supporters of capitalism to undercut support for radical alternatives and aid long term economic development by creating the educated and healthy population required to use advanced technology and fight wars). Thus we find that:

"Liberal social welfare legislation. . . were seen by many [British syndicalists] not as genuine welfare reforms, but as mechanisms of social control. Syndicalists took a leading part in resisting such legislation on the grounds that it would increase capitalist discipline over labour, thereby undermining working class independence and self-reliance." [Bob Holton, British Syndicalism: 1900-1914, p. 137]

Anarchists view the welfare state much as some feminists do. While they note the "patriarchal structure of the welfare state" they are also aware that it has "also brought challenges to patriarchal power and helped provide a basis for women's autonomous citizenship." [Carole Pateman, "The Patriarchal Welfare State", in The Disorder of Women, p. 195] She does on to note that "for women to look at the welfare state is merely to exchange dependence on individual men for dependence on the state. The power and capriciousness of husbands is replaced by the arbitrariness, bureaucracy and power of the state, the very state that has upheld patriarchal power. . . [this] will not in itself do anything to challenge patriarchal power relations." [Ibid., p. 200]

Thus while the welfare state does give working people more options than having to take any job or put up with any conditions, this relative independence from the market and individual capitalists has came at the price of dependence on the state -- the very institution that protects and supports capitalism in the first place. And has we have became painfully aware in recent years, it is the ruling class who has most influence in the state -- and so, when it comes to deciding what state budgets to cut, social welfare ones are first in line. Given that state welfare programmes are controlled by the state, not working class people, such an outcome is hardly surprising. Not only this, we also find that state control reproduces the same hierarchical structures that the capitalist firm creates.

Unsurprisingly, anarchists have no great love of such state welfare schemes and desire their replacement by self-managed alternatives. For example, taking municipal housing, Colin Ward writes:

"The municipal tenant is trapped in a syndrome of dependence and resentment, which is an accurate reflection of his housing situation. People care about what is theirs, what they can modify, alter, adapt to changing needs and improve themselves. They must have a direct responsibility for it.

". . .The tenant take-over of the municipal estate is one of those obviously sensible ideas which is dormant because our approach to municipal affairs is still stuck in the groves of nineteenth-century paternalism." [Anarchy in Action, p.73]

Looking at state supported education, Ward argues that the "universal education system turns out to be yet another way in which the poor subsidise the rich." Which is the least of its problems, for "it is in the nature of public authorities to run coercive and hierarchical institutions whose ultimate function is to perpetuate social inequality and to brainwash the young into the acceptance of their particular slot in the organised system." [Op. Cit., p. 83, p. 81]

The role of state education as a means of systematically indoctrinating the working class is reflected in William Lazonick's essay "The Subjection of Labour to Capital: The rise of the Capitalist System":

"The Education Act of 1870. . . [gave the] state. . . the facilities. . . to make education compulsory for all children from the age of five to the age of ten. It had also erected a powerful system of ideological control over the next generation of workers. . . [It] was to function as a prime ideological mechanism in the attempt by the capitalist class through the medium of the state, to continually reproduce a labour force which would passively accept [the] subjection [of labour to the domination of capital]. At the same time it had set up a public institution which could potentially be used by the working class for just the contrary purpose." [Radical Political Economy Vol. 2, p. 363]

Lazonick, as did Pateman, indicates the contradictory nature of welfare provisions within capitalism. On the one hand, they are introduced to help control the working class (and to improve long term economic development). On the other hand, these provisions can be used by working class people as weapons against capitalism and give themselves more options than "work or starve" (the fact that the recent attack on welfare in the UK -- called, ironically enough, welfare to work -- involves losing benefits if you refuse a job is not a surprising development). Thus we find that welfare acts as a kind of floor under wages. In the US, the two have followed a common trajectory (rising together and falling together). And it is this, the potential benefits welfare can have for working people, that is the real cause for the current capitalist attacks upon it.

Because of this contradictory nature of welfare, we find anarchists like Noam Chomsky arguing that (using an expression popularised by South American rural workers unions) "we should 'expand the floor of the cage.' We know we're in a cage. We know we're trapped. We're going to expand the floor, meaning we will extend to the limits what the cage will allow. And we intend to destroy the cage. But not by attacking the cage when we're vulnerable, so they'll murder us. . . You have to protect the cage when it's under attack from even worse predators from outside, like private power. And you have to expand the floor of the cage, recognising that it's a cage. These are all preliminaries to dismantling it. Unless people are willing to tolerate that level of complexity, they're going to be of no use to people who are suffering and who need help, or, for that matter, to themselves." [Expanding the Floor of the Cage]

Thus, even though we know the welfare state is a cage and an instrument of class power, we have to defend it from a worse possibility -- namely, the state as "pure" defender of capitalism with working people with few or no rights. At least the welfare state does have a contradictory nature, the tensions of which can be used to increase our options. And one of these options is its abolition from below!

For example, with regards to municipal housing, anarchists will be the first to agree that it is paternalistic, bureaucratic and hardly a wonderful living experience. However, in stark contrast with the "libertarian" right who desire to privatise such estates, anarchists think that "tenants control" is the best solution as it gives us the benefits of individual ownership along with community (and so without the negative points of property, such as social atomisation). And anarchists agree with Colin Ward when he thinks that the demand for "tenant control" must come from below, by the "collective resistance" of the tenants themselves, perhaps as a growth from struggles against rent increases. [Op. Cit., p. 73]

And it is here that we find the ultimate irony of the right-wing, "free market" attempts to abolish the welfare state -- neo-liberalism wants to end welfare from above, by means of the state (which is the instigator of this "individualistic" "reform"). It does not seek the end of dependency by self-liberation, but the shifting of dependency from state to charity and the market. In contrast, anarchists desire to abolish welfare from below, by the direct action of those who receive it by a "multiplicity of mutual aid organisations among claimants, patients, victims" for this "represents the most potent lever for change in transforming the welfare state into a genuine welfare society, in turning community care into a caring community." [Colin Ward, Op. Cit., p. 125]

Ultimately, unlike the state socialist/liberal left, anarchists reject the idea that the case of socialism, of a free society, can be helped by using the state. Like the right, the left see political action in terms of the state. All its favourite policies have been statist - state intervention in the economy, nationalisation, state welfare, state education and so on. Whatever the problem, the left see the solution as lying in the extension of the power of the state. And, as such, they continually push people in relying on others to solve their problems for them (moreover, such state-based "aid" does not get to the core of the problem. All it does is fight the symptoms of capitalism and statism without attacking their root causes -- the system itself).

Invariably, this support for the state is a move away from working class people, of trusting and empowering them to sort out their own problems. Indeed, the left seem to forget that the state exists to defend the collective interests of capitalists and other sections of the ruling class and so could hardly be considered a neutral body. And, worst of all, they have presented the right with the opportunity of stating that freedom from the state means the same thing as the freedom of the market (and as we have explained in detail in sections B, C and D, capitalism is based upon domination -- wage labour -- and needs many repressive measures in order to exist and survive). Anarchists are of the opinion that changing the boss for the state (or vice versa) is only a step sideways, not forward! After all, it is not working people who control how the welfare state is run, it is politicians, "experts" and managers who do so. Little wonder we have seen elements of the welfare state used as a weapon in the class war against those in struggle (for example, in Britain during the 1980s the Conservative Government made it illegal to claim benefits while on strike, so reducing the funds available to workers in struggle and helping bosses force strikers back to work faster).

Therefore, anarchists consider it far better to encourage those who suffer injustice to organise themselves and in that way they can change what they think is actually wrong, as opposed to what politicians and "experts" claim is wrong. If sometimes part of this struggle involves protecting aspects of the welfare state ("expanding the floor of the cage") so be it -- but we will never stop there and will use such struggles as a step in abolishing the welfare state from below by creating self-managed, working class, alternatives. As part of this process anarchists also seek to transform those aspects of the welfare state they may be trying to "protect". They do not defend an institution which is paternalistic, bureaucratic and unresponsive. For example, if we are involved in trying to stop a local state-run hospital or school from closing, anarchists would try to raise the issue of self-management and local community control into the struggle in the hope of going beyond the status quo.

Not only does this mean that we can get accustomed to managing our own affairs collectively, it also means that we can ensure that whatever "safety-nets" we create for ourselves do what we want and not what capital wants. In the end, what we create and run by our own activity will be more responsive to our needs, and the needs of the class struggle, than reformist aspects of the capitalist state. This much, we think, is obvious. And it is ironic to see elements of the "radical" and "revolutionary" left argue against this working class self-help (and so ignore the long tradition of such activity in working class movements) and instead select for the agent of their protection a state run by and for capitalists!

There are two traditions of welfare within society, one of "fraternal and autonomous associations springing from below, the other that of authoritarian institutions directed from above." [Colin Ward, Op. Cit., p. 123] While sometimes anarchists are forced to defend the latter against the greater evil of "free market" corporate capitalism, we never forget the importance of creating and strengthening the former. A point we will discuss more in section J.5.16 when we highlight the historical examples of self-managed communal welfare and self-help organisations.

J.5.16 Are there any historical examples of collective self-help?

Yes, in all societies we see working people joining together to practice mutual aid and solidarity. These take many forms, such as trade and industrial unions, credit unions and friendly societies, co-operatives and so on, but the natural response of working class people to the injustices of capitalism was to practice collective "self-help" in order to improve their lives and protect their friends, communities and fellow workers.

Unfortunately, this "great tradition of working class self-help and mutual aid was written off, not just as irrelevant, but as an actual impediment, by the political and professional architects of the welfare state. . . The contribution that the recipients had to make to all this theoretical bounty was ignored as a mere embarrassment - apart, of course, for paying for it. . . The socialist ideal was rewritten as a world in which everyone was entitled to everything, but where nobody except the providers had any actual say about anything. We have been learning for years, in the anti-welfare backlash, what a vulnerable utopia that was." [Colin Ward, Social Policy: an anarchist response, p. 3]

Ward terms this self-help (and self-managed) working class activity the "welfare road we failed to take."

Indeed, anarchists would argue that self-help is the natural side effect of freedom. There is no possibility of radical social change unless people are free to decide for themselves what their problems are, where their interests lie and are free to organise for themselves what they want to do about them. Self-help is a natural expression of people taking control of their own lives and acting for themselves. Anyone who urges state action on behalf of people is no socialist and any one arguing against self-help as "bourgeois" is no anti-capitalist. It is somewhat ironic that it is the right who have monopolised the rhetoric of "self-help" and turned it into yet another ideological weapon against working class direct action and self-liberation (although, saying that, the right generally likes individualised self-help -- given a strike or squatting or any other form of collective self-help movement they will be the first to denounce it):

"The political Left has, over the years, committed an enormous psychological error in allowing this king of language ["self-help", "mutual aid", "standing on your own two feet" and so on] to be appropriated by the political Right. If you look at the exhibitions of trade union banners from the last century, you will see slogans like Self Help embroidered all over them. It was those clever Fabians and academic Marxists who ridiculed out of existence the values by which ordinary citizens govern their own lives in favour of bureaucratic paternalising, leaving those values around to be picked up by their political opponents." [Colin Ward, Talking Houses, p. 58]

We cannot be expected to provide an extensive list of working class collective self-help and social welfare activity here, all we can do is present an overview. For a discussion of working class self-help and co-operation through the centuries we can suggest no better source than Kropotkin's Mutual Aid. Here we will (using other sources than Mutual Aid) indicate a few examples of collective welfare in action.

In the case of Britain, we find that the "newly created working class built up from nothing a vast network of social and economic initiatives based on self-help and mutual aid. The list is endless: friendly societies, building societies, sick clubs, coffin clubs, clothing clubs, up to enormous federated enterprises like the trade union movement and the Co-operative movement." [Colin Ward, Social Policy: an anarchist response, p. 2]

The historian E.P. Thompson confirms this picture of a wide network of working class self-help organisations:

"Small tradesmen, artisans, labourers - all sought to insure themselves against sickness, unemployment, or funeral expenses through membership of . . . friendly societies." These were "authentic evidence of independent working-class culture and institutions . . . out of which . . . trade unions grew, and in which trade union officers were trained." Friendly societies "did not 'proceed from' an idea: both the ideas and institutions arose from a certain common experience . . . In the simple cellular structure of the friendly society, with its workaday ethos of mutual aid, we see many features which were reproduced in more sophisticated and complex form in trade unions, co-operatives, Hampden clubs, Political Unions, and Chartist lodges. . . Every kind of witness in the first half of the nineteenth century - clergymen, factory inspectors, Radical publicists - remarked upon the extent of mutual aid in the poorest districts. In times of emergency, unemployment, strikes, sickness, childbirth, then it was the poor who 'helped every one his neighbour.'" [The Making of the English Working Class, p. 458, pp. 460-1, p. 462]

Taking the United States, Sam Dolgoff presents an excellent summary of similar self-help activities by the American working class:

"Long before the labour movement got corrupted and the state stepped in, the workers organised a network of co-operative institutions of all kinds: schools, summer camps for children and adults, homes for the aged, health and cultural centres, credit associations, fire, life, and health insurance, technical education, housing, etc." [The American Labour Movement: A New Beginning, p. 74]

Dolgoff, like all anarchists, urges workers to "finance the establishment of independent co-operative societies of all types, which will respond adequately to their needs" and that such a movement "could constitute a realistic alternative to the horrendous abuses of the 'establishment' at a fraction of the cost." [Op. Cit., p. 74, pp. 74-75]

In this way a network of self-managed, communal, welfare associations and co-operatives could be built -- paid for, run by and run for working class people. Such a network could be initially build upon, and be an aspect of, the struggles of claimants, patients, tenants, and other users of the current welfare state (see last section).

The creation of such a co-operative, community-based, welfare system will not occur over night. Nor will it be easy. But it is possible, as history shows. And, of course, it will have its problems, but as Colin Ward notes, that "the standard argument against a localist and decentralised point of view, is that of universalism: an equal service to all citizens, which it is thought that central control achieves. The short answer to this is that it doesn't!" [Colin Ward, Op. Cit., p. 6] He notes that richer areas generally get a better service from the welfare state than poorer ones, thus violating the claims of equal service. And a centralised system (be it state or private) will most likely allocate resources which reflect the interests and (lack of) knowledge of bureaucrats and experts, not on where they are best used or the needs of the users.

Anarchists are sure that a confederal network of mutual aid organisations and co-operatives, based upon local input and control, can overcome problems of localism far better than a centralised one -- which, due to its lack of local input and participation will more likely encourage parochialism and indifference than a wider vision and solidarity. If you have no real say in what affects you, why should you be concerned with what affects others? Centralisation leads to disempowerment, which in turn leads to indifference, not solidarity. Rudolf Rocker reminds us of the evil effects of centralism when he writes:

"For the state centralisation is the appropriate form of organisation, since it aims at the greatest possible uniformity in social life for the maintenance of political and social equilibrium. But for a movement whose very existence depends on prompt action at any favourable moment and on the independent thought and action of its supporters, centralism could but be a curse by weakening its power of decision and systematically repressing all immediate action. If, for example, as was the case in Germany, every local strike had first to be approved by the Central, which was often hundreds of miles away and was not usually in a position to pass a correct judgement on the local conditions, one cannot wonder that the inertia of the apparatus of organisation renders a quick attack quite impossible, and there thus arises a state of affairs where the energetic and intellectually alert groups no longer serve as patterns for the less active, but are condemned by these to inactivity, inevitably bringing the whole movement to stagnation. Organisation is, after all, only a means to an end. When it becomes an end in itself, it kills the spirit and the vital initiative of its members and sets up that domination by mediocrity which is the characteristic of all bureaucracies." [Anarcho-Syndicalism, p. 54]

And, as an example, he notes that while the highly centralised German labour movement "did not raise a finger to avert the catastrophe" of Hitler's seizing power and "which in a few months beat their organisation completely to pieces" the exact opposite happened in Spain ("where Anarcho-Syndicalism had maintained its hold upon organised labour from the days of the First International"). There the anarcho-syndicalist C.N.T. "frustrated the criminal plans of Franco" and "by their heroic example spurred the Spanish workers and peasants to the battle." Without the heroic resistance of the Anarcho-Syndicalist labour unions the Fascist reaction would have dominated the whole country in a matter of weeks. [Op. Cit., p. 53]

This is unsurprising, for what else is global action other than the product of thousands of local actions? Solidarity within our class is the flower that grows from the soil of our local self-activity, direct action and self-organisation. Unless we act and organise locally, any wider organisation and action will be hollow. Thus local organisation and empowerment is essential to create and maintain wider organisations and mutual aid.

To take another example of the benefits of a self-managed welfare system, we find that it "was a continual complaint of the authorities [in the late eighteenth and early nineteenth century] that friendly societies allowed members to withdraw funds when on strike." [E.P. Thompson, Op. Cit., p. 461f] The same complaints were voiced in Britain about the welfare state allowing strikers to claim benefit will on strike. The Conservative Government of the 1980s changed that by passing a law barring those in industrial dispute to claim benefits -- and so removing a potential support for those in struggle. Such a restriction would have been far harder (if not impossible) to impose on a network of self-managed mutual aid co-operatives. And such institutions would have not become the plaything of central government financial policy as the welfare state and the taxes working class people have to pay have become.

All this means that anarchists reject totally the phoney choice between private and state capitalism we are usually offered. We reject both privatisation and nationalisation, both right and left wings (of capitalism). Neither state nor private health care are user-controlled -- one is subject to the requirements of politics and the other places profits before people. As we have discussed the welfare state in the last section, it is worthwhile to quickly discuss privatised welfare and why most anarchists reject this option even more than state welfare.

Firstly, all forms of private healthcare/welfare has to pay dividends to capitalists, fund advertising, reduce costs to maximise profits by standardising the "caring" process - i.e. McDonaldisation - and so on, all of which inflates prices and produces substandard service across the industry as a whole. According to Alfie Kohn, the "[m]ore hospitals and clinics are being run by for-profit corporations; many institutions, forced to battle for 'customers,' seem to value a skilled director of marketing more highly than a skilled caregiver. As in any other economic sector, the race for profits translates into pressure to reduce costs, and the easiest way to do it here is to cut back on services to unprofitable patients, that is, those who are more sick than rich . . ." "The result: hospital costs are actually higher in areas where there is more competition for patients." [Alfie Kohn, No Contest, p. 240] In the UK, attempts to introduce "market forces" into the National Health Service also lead to increased costs as well as inflating the services bureaucracy.

Looking at Chile, hyped by those who desire to privatise Social Security, we find similar disappointing results (well, disappointing for the working class at least, as we will see). Seemingly, Chile's private system has achieved impressive average returns on investment. However, once commissions are factored in, the real return for individual workers is considerably lower. For example, although the average rate of return on funds from 1982 through 1986 was 15.9 percent, the real return after commissions was a mere 0.3 percent! Between 1991 and 1995, the pre-commission return was 12.9 percent, but with commissions it fell to 2.1 percent. According to Doug Henwood, the "competing mutual funds have vast sales forces, and the portfolio managers all have their vast fees. All in all, administrative costs . . . are almost 30% of revenues, compared to well under 1% for the U.S. Social Security system." [Wall Street, p. 305] Although market competition was supposed to lower commissions in Chile, the private pension fund market is dominated by a handful of companies. These, according to economists Peter Diamond and Salvador Valdes-Prieto, form a "monopolistic competitive market" rather than a truly competitive one. A similar process seems to be taking place in Argentina, where commissions have remained around 3.5 percent of taxable salary. As argued in section C.4, such oligopolistic tendencies are inherent in capitalism and so this development is not unexpected.

Even if commission costs were lowered (perhaps by regulation), the impressive returns on capital seen between 1982 and 1995 (when the real annual return on investment averaged 12.7 percent) are likely not to be sustained. These average returns coincided with boom years in Chile, complemented by government's high borrowing costs. Because of the debt crisis of the 1980s, Latin governments were paying double-digit real interest rates on their bonds -- the main investment vehicle of social security funds. In effect, government was subsidising the "private" system by paying astronomical rates on government bonds.

Another failing of the system is that only a little over half of Chilean workers make regular social security contributions. While many believe that a private system would reduce evasion because workers have a greater incentive to contribute to their own personal retirement accounts, 43.4 percent of those affiliated with the new system in June of 1995 did not contribute regularly (see Stephen J. Kay, "The Chile Con: Privatizing Social Security in South America," The American Prospect no. 33, July-August 1997, pp. 48-52 for details).

All in all, privatisation seems to be beneficial only to middle-men and capitalists, if Chile is anything to go by. As Henwood argues, while the "infusion of money" resulting from privatising social security "has done wonders for the Chilean stock market" "projections are that as many as half of future retirees will draw a poverty-level pension." [Op. Cit., pp. 304-5]

So, anarchists reject private welfare as a con (and an even bigger one than state welfare). Instead we try to create real alternatives to hierarchy, be it state or capitalist, in the here and now which reflect our ideas of a free and just society. For, when it boils down to it, freedom cannot be given, only taken and this process of self-liberation is reflected in the alternatives we build to help win the class war.

The struggle against capitalism and statism requires that we build for the future ("the urge to destroy is a creative urge" - Bakunin) and, moreover, we should remember that "he who has no confidence in the creative capacity of the masses and in their capability to revolt doesn't belong in the revolutionary movement. He should go to a monastery and get on his knees and start praying. Because he is no revolutionist. He is a son of a bitch." [Sam Dolgoff, quoted by Ulrike Heider, Anarchism: left, right, and green, p. 12]