The Trouble with Marxism (Part One)

Well, I have just about had enough of my conversation with The Andrew Kliman, so I thought I would try to assess what it accomplished instead.

My ‘tin-ear’ with Andrew began after a conversation with @skepoet on twitter about the odd divergence between gold and dollar measures of economic activity since the Great Depression of the 1930s. The dollar measure of US GDP has risen almost uninterrupted since the end of the contraction phase of the Great Depression; while the gold measure of GDP rose from 1934 to 1971, then fell until 1980, rose again from 1980 to 2001, and has been falling since.

Interesting enough, the gold measure of GDP exhibits a classic pattern of boom and bust typical of the economy prior to the Great Depression, but the dollar measure of GDP shows an almost disturbingly smooth continuous upward sweep, until the most recent difficulties of 2008. What I find most interesting about the two measures of economic activity is that, until 1933, both gold and the dollar measures of GDP exhibited the same behavior. However, this identical pattern broke down in 1934.

What accounts for this sudden divergence?

The Sorry State of Anti-Statism, and Other Random Thoughts

So, last night I put myself through the agony of watching the entire NBC sponsored Republican debate. I don’t normally do this, but since I am such a fan of Brian Williams and his fetish for the British royals and heart-warming feel good stories about people making a difference, I figured, “What the fuck?”

What follows are a few of my (almost) unedited random thoughts:

Anarchism, libertarianism, Marxism and Unpaid Labor

Here is something I culled from Marx’s paradox of capitalist price — i.e., the so-called transformation problem — that all present variants of critical communist theory rejects (and, by all variants, I mean the usual suspects: libertarianism, Marxism and anarchism). All conflict in society is directly or indirectly a struggle over the length of the social working day. We could call this Marx’s basic theorem of social development. Marx stated his theorem this way:

The history of all hitherto existing society is the history of class struggle.

But, this class struggle has always more or less directly or indirectly revolved around the uncompensated labor of one portion of society.

All three variants of communist consciousness have advanced their petty demands, while remaining mute on this pivotal issue. However, there is not a single demand advanced by any of them that does not touch on the length of the social working day. The libertarian complaint on taxes, the anarchist complaint on force, and the Marxist complaint on profit all come down to this. Moreover, each variant’s hostility toward the other is wholly rooted in the struggle over working time. It seems logical to assume since all three are only divided by which function of the state they oppose they must all share an ignorance regarding the premise of this state.

That common ignorance can be stated as follows: Each cannot imagine that the premise of the state is the uncompensated labor time of society. Each, therefore, imagines it possible to abolish the present state of things without abolishing its premise — uncompensated labor. Each imagines it possible to ignore abolition of uncompensated labor time, or reduce it to a mere byproduct of the state’s own abolition. Engels made the clearest argument against this ignorance in his argument against Bakunin:

Bakunin has a peculiar theory of his own, a medley of Proudhonism and communism. The chief point concerning the former is that he does not regard capital, i.e. the class antagonism between capitalists and wage workers which has arisen through social development, but the state as the main evil to be abolished. While the great mass of the Social-Democratic workers hold our view that state power is nothing more than the organization which the ruling classes-landowners and capitalists-have provided for themselves in order to protect their social privileges, Bakunin maintains that it is the state which has created capital, that the capitalist has his capital only by the grace of the state. As, therefore, the state is the chief evil, it is above all the state which must be done away with and then capitalism will go to blazes of itself. We, on the contrary, say: Do away with capital, the concentration of all means of production in the hands of the few, and the state will fall of itself [fällt von selbst]. The difference is an essential one: Without a previous social revolution the abolition [Abschaffung] of the state is nonsense; the abolition of capital is precisely the social revolution and involves a change in the whole mode of production. Now then, inasmuch as to Bakunin the state is the main evil, nothing must be done which can keep the state-that is, any state, whether it be a republic, a monarchy or anything else-alive. Hence complete abstention from all politics. To commit a political act, especially to take part in an election, would be a betrayal of principal.

Uncompensated labor, Engels is arguing, is the essential precondition for the state. Marxists have used this quote as the dividing line between it and all other variants of communist consciousness. But, Marxists no more grasp it than either of the other two — hence, not a single Marxist sect raises demands on the working day. Even when they might, on occasion, weakly argue for it, it is nevertheless accompanied by a demand for money wages to remain unchanged. As if the question is not the uncompensated labor, but the worthless paper dollars exchanged for necessary labor.

In fact, paper money is a worthless token having no relation whatsoever to the real compensation the worker receives for her labor power — the only measure of the value of labor power is gold or another commodity money. Currency was debased precisely to make sure there would be no relation between the value of labor power and its price (wages). Keynes says this very thing in his “General Theory”, and I have pointed out the paragraph in which he makes his argument to Marxists time and again without penetrating their dull brains.

Though the struggle over money-wages between individuals and groups is often believed to determine the general level of real wages, it is, in fact, concerned with a different object. Since there is imperfect mobility of labour, and wages do not tend to an exact equality of net advantage in different occupations, any individual or group of individuals, who consent to a reduction of money-wages relatively to others, will suffer a relative reduction in real wages, which is a sufficient justification for them to resist it. On the other hand it would be impracticable to resist every reduction of real wages, due to a change in the purchasing-power of money which affects all workers alike; and in fact reductions of real wages arising in this way are not, as a rule, resisted unless they proceed to an extreme degree. Moreover, a resistance to reductions in money-wages applying to particular industries does not raise the same insuperable bar to an increase in aggregate employment which would result from a similar resistance to every reduction in real wages.

In other words, the struggle about money-wages primarily affects the distribution of the aggregate real wage between different labour-groups, and not its average amount per unit of employment, which depends, as we shall see, on a different set of forces. The effect of combination on the part of a group of workers is to protect their relative real wage. The general level of real wages depends on the other forces of the economic system.

Thus it is fortunate that the workers, though unconsciously, are instinctively more reasonable economists than the classical school, inasmuch as they resist reductions of money-wages, which are seldom or never of an all-round character, even though the existing real equivalent of these wages exceeds the marginal disutility of the existing employment; whereas they do not resist reductions of real wages, which are associated with increases in aggregate employment and leave relative money-wages unchanged, unless the reduction proceeds so far as to threaten a reduction of the real wage below the marginal disutility of the existing volume of employment. Every trade union will put up some resistance to a cut in money-wages, however small. But since no trade union would dream of striking on every occasion of a rise in the cost of living, they do not raise the obstacle to any increase in aggregate employment which is attributed to them by the classical school.

If Marxists can’t grasp the significance of these paragraphs for fascist state political-economy, what hope is there for those who imagine wages can be exchanged for labor power without wages slavery? The struggle against the state is nothing more than a struggle against the theft of uncompensated labor by the state in whatever form. If we cannot grasp this, we will continue to wander around as tiny little isolated sects, or sink further into lonely pessimism: The economic policy of the fascist state is nothing more than a device for compelling increasing quantities of uncompensated labor time from society.

Why is the Bank for International Settlements interested in Karl Marx? (FInal)

Paul A. Samuelson: bald-faced liar and propagandist for the fascist state

(Or, more importantly, why should anarchists, libertarians and Marxists be as well)

So, has any reader of this blog heard that economists have conceded Marx was right after all? Have you at any time during the past 40 years heard an economist admit that Marx was correct in his transformation argument? I am really confused by this, because although Paul A. Samuelson declared Marx’s labor theory of value irrelevant in 1971, it is still being studied by BIS economists today. If I told you Marx’s theory was being studied by economists because Samuelson was a bald-face liar and a practiced dissembler, you would probably just yawn.

Of course, he was lying — he’s an economist. Economists are paid to lie and distort reality. They are employed by Washington not to explain economic processes, but to obscure them. To call an economist a bald-face liar, is simply to state he is breathing — nothing more.

But, to understand why Samuelson was lying, and why it was necessary that his lie stand unchallenged for forty years, we have to figure out the problem posed by Marx’s so-called “transformation problem”.

Anarchism versus Marxism (Or, Dumb and Dumber, Part two)

Marx (L) and Bakunin

I had a conversation with Tim (@timthesocialist) last night which was really interesting. I have not debated a Marxist about Marx in some time. I am really trying to understand the Marxist argument on the state — at least the Leninist wing of Marxism. As a Marxist by history this should be easy for me, but surprisingly it is not. I am looking for some distinction between anarchism and Marxism on the state — but it is quite difficult to find one.

Both anarchists and Marxists insist Marx’s theory involves something called the “worker’s state”, that replaces the present state. They both insist on this despite the lack of any reference to such an abomination in Marx’s own writings. Marx does indeed insist that had there been a successful revolution during his lifetime, the result would have been a “revolutionary dictatorship”. But, there are many curious features of his argument.

Why is the Bank for International Settlements interested in Karl Marx? (Part three)

In my previous post, I stated:

In reality, there was nothing in Bohm-Bawerk’s argument to be disproved. Bohm-Bawerk had indeed cited the essential contradiction at the core of capitalism. His problem, however, was to imagine the contradiction to be a defect of Marx’s theory, and not a fatal flaw laying at the heart of the capitalist mode of production itself.”

Bohm-Bawerk had inadvertently confirmed the rather grim future arrived at by Marx’s theory: Capitalism would kill the so-called free market, and in so doing, would destroy itself. It was, as Marx argued, creating its own gravediggers, a mass of directly social laborers who did not need it, and would see it as an impediment to their very survival, owing to obstacles it put in the way of its own operation.

By the 1970s, economists finally were forced to acknowledge there was in fact no inconsistency in Marx’s argument. Marx had, just as Bohm-Bawerk accused him, arrived at a theoretical description for why prices, although resting on the socially necessary labor time required to produce commodities, nevertheless appeared to reflect the prices of production of these commodities and not their labor times. It was not, as Werner Sombart feared, that from Marx’s labor theory of value “emerges a ‘quite ordinary’ theory of cost of production”, but precisely that Marx’s theory predicted from the first that the value of commodities must appear in the form of prices of production.

Moreover, Marx had demonstrated his proof almost in real time, so to speak, in front of his audience in a painstakingly detailed series of volumes — subject to the critical purview of his opponents. He had, as it were, made the elephant in the room — socially necessary labor time — disappear before the disbelieving eyes of his skeptical audience. It was a performance so dramatic and unprecedented, it took decades for the skeptics even to figure out what they had just witnessed with their own eyes.

The acknowledgement of Marx’s triumph took the form of a paper by Paul A. Samuelson, and was couched in the form of the complaint echoing that leveled against Marx by Sombart, as previously quoted by Bohm-Bawerk :

“…if I have in the end to explain the profits by the cost of production, wherefore the whole cumbrous apparatus of the theories of value and surplus value?”

Taking a cue from Sombart, Samuelson, in a paper titled “Understanding the Marxian Notion of Exploitation: A summary of the So-Called Transformation Problem Between Marxian Values and Competitive Prices”, introduced his so-called erasure method arguing,

It is well understood that Karl Marx’s model in Volume I of Capital (in which the “values” of goods are proportional — albeit not equal — to the labor embodied directly and indirectly in the goods) differs systematically from Marx’s model in Volume III of Capital, in which actual competitive “prices” are relatively lowest for those goods of highest direct-labor intensity and highest for those goods of low labor intensity (or, in Marxian terminology, for those with highest “organic composition of capital”). Critics of Marxian economics have tended to regard the Volume III model as a return to conventional economic theory, and a belated, less-than-frank admission that the novel analysis of Volume I — the calculation of “equal rates of surplus value” and of “values” — was all an unnecessary and sterile muddle.’

Samuelson gave a simple straightforward explanation of his “erasure method”:

I should perhaps explain in the beginning why the words “so-called transformation problem” appear in the title. As the present survey shows, better descriptive words than “the transformation problem” would be provided by “the problem of comparing and contrasting the mutually-exclusive alternatives of `values’ and `prices’.” For when you cut through the maze of algebra and come to understand what is going on, you discover that the “transformation algorithm” is precisely of the following form: “Contemplate two alternative and discordant systems. Write down one. Now transform by taking an eraser and rubbing it out. Then fill in the other one. Voila!

For all his genius, Samuelson argued, Marx had produced a theory which offered no greater insight into the social process of production than was already present in the form of mainstream economics. It could, for this reason, be entirely ignored.

Ignored also, however, would be the entire point of Marx’s “unnecessary and sterile” detour: namely, to demonstrate in comprehensive and theoretically ironclad fashion why the capitalism mode of production is doomed.

This only deepens the mystery of David Bieri’s interest in a theory routinely dismissed by economists as, at best, a vestigial remnant of classical political-economy. Why would this former bureaucrat of the Bank for International Settlements still be reviewing an obscure technical problem of a long dead theory?

Why is the Bank for International Settlements interested in Karl Marx? (Part two)

Bohm-Bawerk's "Marx and the Close of His System"

In the previous blog post, I argued that in each of the three great capitalist catastrophes of the 19th and 20th Centuries — the Long Depression, the Great Depression and the Great Stagflation — economists scurried to bone up on Marx in an effort to understand practical problems of state economic policy confronting them at the time.

Naturally, the connection between these catastrophes and interest in Marx intrigued me, since this guy Bieri is now interested as well. If Bieri were just another Marxian economist I could understand his interest but his connection to the BIS and Bankers Trust, London intrigued me. Bankers Trust, one of the many institutions with which Bieri has been associated, is not exactly your typical local community credit union. It was up to its neck in the dirty dealings that led to financial crisis, and has long been implicated with equally shady dealings in the market in general. Here is what Wikipedia has to say about it:

“In 1995, litigation by two major corporate clients against Bankers Trust shed light on the market for over-the-counter derivatives. Bankers Trust employees were found to have repeatedly provided customers with incorrect valuations of their derivative exposures. The head of the US Commodity Futures Trading Commission (CFTC) during this time was later interviewed by Frontline in October 2009: “The only way the CFTC found out about the Bankers Trust fraud was because Procter & Gamble, and others, filed suit. There was no record keeping requirement imposed on participants in the market. There was no reporting. We had no information.” -Brooksley Born, US CFTC Chair, 1996-’99.

Several Bankers Trust brokers were caught on tape remarking that their client [Gibson Greetings and P&G, respectively] would not be able to understand what they were doing in reference to derivatives contracts sold in 1993. As part of their legal case against Bankers Trust, Procter & Gamble (P&G) “discovered secret telephone recordings between brokers at Bankers Trust, where ‘one employee described the business as ‘a wet dream,’ … another Bankers Trust employee said, ‘…we set ‘em up.”

Perhaps I am just being a tad paranoid, but when a guy with these kinds of connections starts sniffing around dusty old volumes of Capital just before the outbreak of the financial crisis of 2008, I begin to wonder what’s up.

But, I’m getting ahead of myself, am I not? I have not yet even explained what all the fuss is about. This tale begins with a little known simpleton scribbler, whose name is probably unfamiliar to anyone outside of the field of economics: Eugen von Bohm-Bawerk.

Why is the Bank of International Settlement interested in Karl Marx?

I’m reading, “The Transformation Problem: A Tale of Two Interpretations”, by David Bieri.

According to his profile,

David studied economics at the London School of Economics and international finance at the University of Durham (UK). In 2006, he started his Ph.D. studies in SPIA.

From 1999 until 2006, David held various senior positions at the Bank for International Settlements, most recently as the Adviser to the General Manager and CEO. From 2002 to 2004, he held the position of Head of Business Development in which capacity he was responsible for new financial products and services and reserve management advisory for central banks. From 2004 to 2005, David worked as an economist in the BIS’ Monetary & Economics Department.

Prior to joining the BIS, David worked as a high-yield analyst at Banker’s Trust in London and in fixed-income syndication at UBS in Zurich.

What caught my attention is the notable resume of this author, which is quite unlike that of the typical Marxian economist. High-yield analyst, central bank bureaucrat, mainstream economist? This is not the sort of person you will find at your local Occupy campsite.

Why, I wondered, is the Bank of International Settlement interested in an obscure technical problem of Marx’s theory? So, I decided to give the paper a read.

Occupy, the Tea Party, and The Rebellion of “Ignorant” Foxes

Although generally called ignorant and uncultured, the Lollards were simultaneously portrayed by the Church as sly foxes seducing members of society and then devouring them.

To understand the significance of the Occupy and Tea Party movements to anti-statism, look at their predecessor movement, the Lollards of the 14th and 15th Century England. This movement, which arose in England during the period leading to the Great Reformation, imposed its will on the state and the church in a fashion similar to the way our own Occupy and Tea party movements are making their power felt in politics today.

The Lollards were a dissident sect within Catholicism who argued there was an “invisible” church as well as a visible one. The visible church was the Catholic hierarchy, the invisible church, however, was composed of the entire body of believers. According to the Wikipedia, the movement attacked the authority of the church and its priests. They insisted lay persons could as well perform the religious functions as well as any priest.

According to the Wikipedia: “A Lollard blacksmith in Lincolnshire declared that he could make ‘as good a sacrament between “… ii yrons as the prest doth upon his auter (altar)’”

Lollard, Lollardi or Loller was the popular derogatory nickname given to those without an academic background, educated if at all only in English, who were reputed to follow the teachings of John Wycliffe in particular, and were certainly considerably energized by the translation of the Bible into the English language. By the mid-15th century the term lollard had come to mean a heretic in general. The alternative, “Wycliffite”, is generally accepted to be a more neutral term covering those of similar opinions, but having an academic background.

The term is said to have been coined by the Anglo-Irish cleric, Henry Crumpe, but its origin is uncertain. The Oxford English Dictionary has no doubt:

1. from “M[iddle] [Dutch] lollaerd, lit. ‘mumbler, mutterer’, f[rom] lollen to mutter, mumble”.
2. Three other possibilities for the derivation of Lollard have been suggested:
   1. the Latin name lolium (Common Vetch or tares, as a noxious weed mingled with the good Catholic wheat);
   2. after the Franciscan, Lolhard, who converted to the Waldensian way, becoming eminent as a preacher in Guienne. That part of France was then under English domination, influencing lay English piety. He was burned at Cologne in the 1370s;
   3. the Middle English loller (akin to modern, albeit semi-archaic, verb loll), “a lazy vagabond, an idler, a fraudulent beggar”; but this word is not recorded in this sense before 1582. It is recorded as an alternative spelling of Lollard.

The Dutch derivation is the most likely. It appears to be a derisive expression applied to various people perceived as heretics — first the Franciscans and later the followers of Wycliffe. Originally the word was a colloquial name for a group of the harmless buriers of the dead during the Black Death, in the 14th century, known as Alexians, Alexian Brothers or Cellites. These were known colloquially as lollebroeders (Middle Dutch), ‘mumbling brothers’, or “Lollhorden”, from Old German: lollon, meaning “to sing softly,” from their chants for the dead. The modern Dutch word is lullen, meaning to babble, to talk nonsense.

Church propaganda of the time portrayed the lollardy as unscrupulous foxes who were out to seduce the Churches vulnerable members:

Lollards were represented as foxes dressed as monks or priests preaching to a flock of geese on misericords. These representations alluded to the story of the preaching fox found in popular Medieval literature such as The History of Reynard the Fox and The Shifts of Raynardine (the son of Raynard). The fox lured the geese closer and closer with its words until it was able to snatch a victim to devour. The moral of this story was that foolish people are seduced by false doctrines.

Does this characterization sound familiar? How often have you heard someone from the Tea Party characterized as ignorant, or someone from the Occupy characterized as filthy, uneducated and lacking both useful work skills and a job? Lollardy was a pejorative term applied to the crude folk who imagined they could replace the elites with their own self-activity. Like the Occupy and the Tea Party, the lollards were “uneducated” common folk, who had the nerve to confront elites in the church and the state.

In an 1885 introduction to Fortescue’s “The Governance of England”, Charles Plummer wrote:

“Henry IV came to the throne as the representative of the ‘possessioned’ classes–to use a contemporary expression. The crude socialism of the Lollards, as the barons saw, and as the Churchmen were careful to point out, threatened the foundations not merely of the Church, but of all property.”

(Fucking anarchists and socialists screwing things up even in the Fifteenth Century.)

The Lollards movement is interesting in itself, but Plummer’s commentary is just as interesting. Plummer points out the anti-clerical and anti-property character of the lollards, but he also points out how the dissent expressed in the lollard movement effected the monarchy. The crown, as the general representative of property, was under duress for the whole of Henry IV’s reign, by the commons. Henry IV was dependent on Parliament to raise the taxes necessary to defend property interests, “against foreign and domestic enemies.” It was this dependence on the Parliament, that Plummer cites as one of the chief sources of trouble during Henry IV’s reign.

Says Plummer:

“But the causes of his weakness are plain enough. He was weak through his want of title, weak through the promises by which he had bound himself to those whose aid had enabled him to win the crown, weak most of all through his want of money.”

Henry IV’s own want of money was not merely his own, but a general monetary crisis perhaps traceable to political causes as Plummer argued:

“This scarcity of money was due partly to the general want of confidence in the stability of the government which succeded the brief enthusiasm in Henry’s favour, and which led people to hoard their gold and silver, so that not only was none forthcoming to meet the demands of the government, but capital, which ought to have been employed productively, was withdrawn from circulation, thus causing for the time a general diminution of the resources of the country.”

Fortesque argued, the crown needed its own independent source of income and standing that was not dependent on the periodic challenges of economic and political events. I think it is fair to state from Fortescue’s time  to today the over-riding impulse of the state has been to acquire an independent existence from society as representative of the interest of property within society.

And, I think it is no accident that Adam Smith’s masterwork of economics is not titled, “The Wealth of Individuals”, but “The Wealth of Nations”. The subject of contemplation for economists has never been “the economy” as we might imagine — it is the state and how to manage the economic activity of society on behalf of the state. Seeking its own independent existence as a form of property has always been the aim of the state and this has led it into conflict with society.

I think it is necessary to clear up the standing misinterpretation, widespread among anti-statists, that the state is either neutral, or at worst, a representative of some particular property interest in society. Fortescue’s argument demonstrates the state is, and has always been, a distinct interest in society — in particular a distinct property interest hostile to other property interests in society. It is a player in the economy, and by no means, just a corrupt refereee among economic players in the great game.

For Marxists who might object to this argument, I offer none other than Marx himself, who deliberately characterized the capitalist as only the personification of the relation between capital and wage labor. The popular caricature of the lone Koch Brother type capitalist lording it over his private empire of dependent wage slaves is not necessary to the relationship, and, moreover, is not even an accurate model of Marx’s theory but a crass vulgarization.

First, as Marx himself clearly stated, the worker is entirely capable of acting as her own capitalist, and has not the slightest need for the capitalist to accomplish this disgusting task. Second, he and Engels noted by the late 1800s the personification itself was being socialized through the emergence of  joint-stock companies and cartelization. Finally, Engels argued it was inevitable the state would become the national capitalist.

The ultimate exploiter of labor power is not Mr. Moneybags, but Barack Obama; which is to say, the modern executive branch of the state, whose lineage is directly traceable to the crown, not the much praised and condemned private entrepreneur. Properly understood, the state is not corrupted by property interests in society, it is both the general form of these property interests within society and an interest its own right.

This is the background to the Occupy and Tea Party movements, a general social discontent with this independent and unaccountable social power among all classes and strata within society. The fascist state is an unaccountable social power made all the more so by the modern money system, which frees the state from any dependence on taxes and debt, and, which has allowed it to become entirely “self-financing”, so to speak. With the capacity to print money into existence, the state achieved a degree of independence hitherto unequaled in the history of the state. It has acquired the monetary and practical means to commit the nation to war on any pretext whatsoever; it has expressed absolute hostility to every form of property that it cannot make subordinate to its own interest as property. Most of all, it has become the largest and most ruthless exploiter of labor power in the annals of history — actually converting other national capitals into mere means of its own self-expansion.

The absolutism of the fascist state, its totalitarian character, has brought the category of state to its most perfect expression: it is, at once, both the perfection of the state and the perfection of capitalist relations in one social body. Against this absolutist power is arrayed nothing more than a rebellion of the ignorant — those who are so uneducated and uncultured only they can see through the silly mystifications of fascist state ideologues.

If You Want to End Poverty, You Should Oppose Poverty Programs

Today and tomorrow Washington will publish a host of meaningless, but anxiously awaited, jobs numbers. Indications are these numbers will be unprecedentedly awful by any historical standard, but your expectations will be managed in such a way, that, by the end of the nightly news, you too will view them as at least weakly positive.

So, what does it mean to say the jobs numbers are positive? Are fewer jobs bad when you’re utterly dependent on wage labor? Are more jobs good, when you’re nothing more than a wage slave? Frankly, in my opinion the only good jobs figure is zero, folks: No one has a job; no one has a wage; we are all unemployed. When that makes sense, you’ve figured out the secret of capitalism.

Anti-statists wax eloquent about abolishing the state, but here is a hint: wage slavery is the state.

The number of Marxists who know the state is founded on wage slavery, yet weep when unemployment increases, is shocking. Marxists typically treat any rise in unemployment as if it is the end of the world. The argument made by some silly Marxists is that if we do not demand an end to unemployment we are banking on the resulting mass suffering as a trigger for a revolution.

I’m not buying into that argument. Honestly, to my mind this seems to place us in a bind: to prevent mass suffering from unemployment, we have to promote ever increasing wage slavery. We end up opposing wage slavery only to the extent it does not cause any actual suffering.

By contrast, libertarians of the Austrian type, who oppose any state effort to stabilize the economy, come off looking like cold-blooded savages. In the public mind, to oppose state countercyclical policy intervention, you have to be an Austrian knuckle-dragger, who views society as some Darwinistic nightmare.

Frankly, this predicament is not the least bit satisfying; I don’t want to have to choose between wage slavery and starvation. I’m just thinking out loud about this problem. It seems to me we are not limited to the two choices offered by capital and the state.

I think, we should be prepared to state that, as anti-statists, we would rather starve than live on handouts from the state — fuck the state, and fuck politicians who promise to ease our burden of wage slavery.

Of course, some will argue we are being heartless as @zappdos pointed out graphically on Twitter:

“I’m not sure about that one. Opens up to a myriad of “let them die” moments- they don’t tend to go over well.”

I agree that this position is subject to that interpretation, but @zappdos is only looking at one side of the equation: the dirty little secret of capital is they need unemployment insurance more than we do. Refusing any offer of state aid has a bigger impact on the business cycle than on us — which is why they prefer it.

As @PunkJohnnyCash argued

“Safety nets are to prevent uprising. It’s what @StatelessWonder calls the pressure relief valve.”

I think this is precisely correct. I think we have to call the Democrat/GOP bluff, and demand they end all state welfare of any type. This is a very hard argument to make — one that cannot be made effectively by Austrian knuckle-draggers, because — frankly — they hate working people.

Fundamentally, however, the Austrians are correct: state subsidies of poverty only make it possible for inefficient capitals to exist. Remove state subsidies and these capitals must go belly up, including those devoted to state militarism. The end of these subsidies will be deflationary in the extreme; which is why they were implemented in the first place. Deflation shifts income from profits to wages; inflationary state countercyclical economic policy, does the reverse — it is purposely designed to reduce the purchasing power of wages and increases profits.

We have been fooled for decades into believing state economic policy helps the poor, when, in reality, it only enriches the wealthy and increases poverty. The term “poverty program” is a slick marketing gimmick; ending state welfare programs is the surest way of ending poverty. The argument is extremely bizarre unless you actually understand how poverty programs work. But. think about what food stamps do to subsidize industrial agriculture, and you get some idea of how this program serves only to subsidize Archer Daniels Midland — without in the least ending the scourge of hunger.

I think we should not be embarrassed to call for the end to these programs, and to state they are designed to perpetuate poverty not end it. No doubt, we will get a lot of pushback from progressives, who will rightly point to the results of neoliberal policies since the Reagan administration. I would not disagree with them on this. Exporting industrial capacity has intensified the crisis of poverty. But, logic dictates the state only creates so-called poverty programs by diverting social resources. And, it alone has been responsible for the unequal distribution of social resources in the first place, though its neoloberal “free trade” policies.

The state has purposely created the mass poverty it now pretends to address with its neoliberal policies. Washington has encouraged the export of industrial capacity to the lowest wage nations in the world market, and propose to fix this by offering retraining here. On this basis, it is no surprise neoliberal policies only exacerbates poverty — how could it be otherwise. We should tell them: “Fuck you, sell your iPods to poverty-stricken Chinese peasants, bitches.”

We should not be embarrassed to confront progressives with the patent insanity of their worldview. They will paint anti-statists as heartless insensitive bastards who thrive on hunger and poverty — we need to call them out on this shit. Not once in the past forty years has progressive politics succeeded in reversing the decline in wages and living standards.

We should have no illusions that progressives will be convinced by these arguments. They are fascists ideologues who only see progress measured by the size of the fascist state and its programs.

As @postleftanarchy stated:

“It’s a difficult task. When I try to talk to statists about anarchy they immediately shut down. Either troll me or insult me.”

Another anarchist, @ChuckBaggett, made the progressive argument, when he asked me:

“Would you deny the starving the right to take what they need to eat? Does that sound familiar?”

No. I would not deny this — the problem is that Washington is denying it right now. They are taking supposedly scarce social resources and pouring them into wars of aggression all over the planet. Yet, progressives have been mute about this vile practice to preserve their alliance with the Democrats. The past 40 years has been rule by misdirection: Progressives want to keep our attention on the GOP, while the Democrats voted to export the industrial base of the country through NAFTA and other such “free trade” agreements. They played this role just as they kept our attention on Bush, while the Democrats voted for the Patriot Act, authorized the Bush wars, etc.

I think anti-statists need to give serious thought to opposing all forms of state aid for unemployment and poverty on the right grounds. We need to be able to make the argument not that working people are shiftless welfare recipients, but that the state is deliberately creating poverty. We need to show Washington is engaged in spreading poverty and these “poverty programs” are a fig leaf to cover official state policy.

I am not saying this is an easy argument to make, but it is a necessary one if anti-statism will gain any following. For too long the anti-state message has been abandoned to cranks, racists, and Koch-suckers — we need to change this. The hardest argument to make is why ending unemployment compensation entirely will force the end of all joblessness – if you can’t make that argument, you’re finished. If you cannot make that argument, you have no argument against the state. Unemployment under capitalism is as normal as sunrise — if the only way to deal with it is unemployment compensation and job retraining, it will not be politically possible to abolish the state.

That is a political fact all anti-statists should memorize. Anti-statism is a pipe-dream, if we have no solution to poverty and joblessness, but state programs. I just want to call on all anti-statists to craft their own argument for why the state itself creates poverty. All of our arguments will necessarily be different, but we should have one when confronting silly fucking progressives.

While I was outlining this post, one anarchist, @roastydog interjected that some agorist and mutualist type models focus on non-state support networks. He argued:

“mutual aid networks are the only effective way to tell the State to fuck off without dooming millions to starvation.”

While I do not agree the mutualism is the only alternative to the fascist state, at least mutualism and agorism have thought about how to make an argument for an alternative approach to poverty — something most anti-statists, like, for instance, Marxists, don’t even think about.

Don’t concede the argument to those statist assholes. Don’t let them intimidate you on moral grounds. Shove Obama’s “failures” in their pie holes and watch them choke on that shit. Poverty today would be impossible without the active participation of the state in maintaining and spreading it.