Pootmop!

by Liberty and Power

[cross-posted at Austro-Athenian Empire]

As a number of left-libertarians have noted, both “capitalism” and “socialism” are ambiguous terms, bound up with various sorts of confusions. (That’s one reason I try to avoid using them, at least without some sort of qualifying prefixes, adjectives, or scare-quotes. Incidentally, I’m pleased to see that one of my own discussions of this problem is featured – for now – on Wikipedia’s Issues in Anarchism page.) But there’s one definition of the word “capitalism” that might seem perfectly straightforward and unambiguous. Yet actually I think it is no such thing.

The definition I have in mind is: private ownership of the means of production (henceforth pootmop). One thing that most libertarians in the so-called “capitalist” tradition don’t realise (it took me years to realise it) is that when most socialists hear or use this phrase they take it to imply, by definition, the ownership of the means of production by people other than the workers who do the producing – so that a society in which most firms are worker-owned co-ops would not count, in their eyes, as one characterised by pootmop.

This of course is not at all what “capitalist” libertarians take the phrase to mean; although they may tend to assume the traditional hiring-of-labour as the paradigm or default instance of pootmop, a society of worker-owned co-ops – whether or not “capitalist” libertarians would find such a system likely or desirable – would be a perfectly acceptable instance of pootmop. To “capitalist” libertarians, pootmop contrasts not with worker-owned co-ops but with the ownership of the means of production either by the state or by society at large.

Now there are, to be sure, many “socialist” advocates of worker control who envision such control as being exercised either via the state (e.g., Marx, at least in the short run) or via society at large (e.g., Kropotkin). But there are a good many “socialists,” particularly in the anarchist tradition, who favour something like decentralised, bottom-up networks of autonomous local workers’ co-ops – which would count as pootmop by some standards and not others.

A problem for mutual communication between the “capitalist” and “socialist” libertarians, then, is that one group hears the phrase “private ownership of the means of production” and thinks, “ah yes, producers getting to keep what they produce,” and the other group hears the same phrase and thinks, “ah yes, producers not being allowed to keep what they produce.” My advice to both groups, then, is: try not to use this phrase without explaining it, and don’t automatically assume you know what others mean by the phrase when they use it.

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Craig J Bolton - 6/28/2008

I thought that what I was saying was rather clear - you are concerned that socialists hear "exploitation" or "boss domination" or some equivalent when a capitalist sort says POOTMOT. My response was that there was really something much deeper going on in socialist ideology that doesn't rest on MERELY a linguistic confusion or misunderstanding over what the other guy is saying.

What is going on is a commitment to some notion of "exploitation" that transcends mere facts.

Further, the facts that are critical aren't dismissable as easily as you would like to dismiss them. Yes, there is little or no truly "free market" any where today. But it doesn't therefore follow that nothing can be said about the relative advantages of different ways of organizing enterprises. Cooperative, in almost every jurisdiction in the U.S., are given a variety of tax and other legal advantages RELATIVE TO TRADITIONALLY ORGANIZED FIRMS. [Look it up in your state statutes.] That means that the departures from the "free market" [whatever exactly "free market" means without the existence of some "natural specification of property rights"] FAVOR cooperatives in their organizational competition with traditionally organized "boss managed" firms.

According to socialist theory cooperatives wouldn't need such advantages to out compete traditionally organized firms. They'd out compete traditional firms, even on a level playing field, since workers would get to retain their "surplus value" in a cooperative [if not individually, then collectively], where as the owners of capital get the workers' surplus value in a boss managed firm.

But cooperatives don't, in fact, out compete traditionally organized firms, even when given legal advantages. They are notoriously inefficient, no one who actually has to depend on wages to make a living wants to work for them, and they are, consequently, a very small minority of total firms.

Claims of linguistic confusion are sometimes partially correct, but those who believe that virtually all important differences between ideologies are due to "differences in perspective" and linguistic misunderstandings are simply wrong. An ideology is based on a commitment to certain core concepts. Some ideologies are "open," in that their core concepts evolve over time as contrary evidence is discovered. Some are not open to contrary evidence. But ideologies aren't just all the same except for some linguistic confusions and differences in perspectives.

Roderick T. Long - 6/27/2008

I'm not entirely sure what you're saying, but it sounds as though you're asking why workers' co-ops haven't outcompeted traditional firms in a free market. But surely the answer to that question is: what free market?

Craig J Bolton - 6/27/2008

The "terminological confusion" that I don't get is on the other side of Professor Long's equation, the socialist side.

If you are a non-Leninist [and, hence, don't believe in the mysterious transfer of "surplus value" internationally] why doesn't the existence [indeed, the legal encouragement] of cooperative enterprises resolve the "socialist issue." Yes, socialists may hear "monopoly," "concentration," and "exploitation" when a Right libertarian says "POOTMOP," but why doesn't the existence of cooperatives put an end to all of those situations? If cooperatives are such vastly superior forms of enterprise, at least from the standpoint of workers, wouldn't many workers prefer to keep the "surplus value" that they would be otherwise giving to the exploiting capitalist and flock to such organizations? Why don't they?

And wouldn't those who want to stay with traditional capitalist managed firms, as the vast number of workers joined cooperatives, thus be able to obtain higher wages as their numbers fell dramatically?

There is something more fundamental going on here besides a "you don't hear what I am saying" problem. There is some implicit belief in some magical principle, or, perhaps in Malthus, that isn't being expressed in this sort of exchange by socialists.