What Would An Anarcho-Socialist Economy Look Like?

by Keith Preston
I have been asked by readers of Anti-State.com to expound a bit upon my own anarcho-socialist
perspective. Specifically, I have been asked to describe how a socialist-anarchist economy miht come
into bein, how such an economy miht sustain itself over the lon haul and how the typical town!s
"c#onald!s or $al-"art miht be communali%ed. &efore I attempt to answer these 'uestions, it miht
be useful to the reader if I first sketch a very eneral outline of the overall conceptual framework I am
operatin in and the theory of political economy to which I subscribe.
I am a socialist-anarchist in the classical &akuninist tradition. (ike )oam *homsky, I consider this
tradition to be the proper heir to classical liberalism and its criti'ue of concentrated power-political,
economic, military, ecclesiastical and otherwise. +or me, at least, &akuninist anarchism is simply
classical liberalism updated to include a criti'ue of the role of business corporations in perpetratin
modern systems of power relations. ,nlike his enemies, the "arxists, &akunin reconi%ed that the state
is an artificially privileed social class unto itself, above and beyond that of economic and social
authorities. In his day -mid-nineteeth century *entral .urope/, the class structure consisted of the state,
first of all, the state-protected feudal landlords, the state church and the nascent industrial boureois
class created by state intervention into the emerin market economy. &akunin!s antidote to this system
of oppression involved the insurrectionary efforts of the workers and peasants to remove the state and
the state-privileed exploiter classes in favor of a decentrali%ed confederation of peasant communes
and workers! collectives tendin the land and the industrial machinery minus the upper strata of
oppressors.
$hat I attempt to do is apply &akuninist analysis to the modern world. An indispensable aspect of
classical &akuninism is its criti'ue of state socialism. &akunin predicted that if state socialism ever
came to power it would produce a type of 0red bureaucracy0 that would in turn enerate the bloodiest
tyranny in history. 1his prophecy was unfortunately reali%ed in the infamous communist, fascist and
national socialist reimes of the twentieth century. (ikewise, &akunin arued that the rulin classes
would seek to avoid their own ultimate dislocation and expropriation via popular revolution and seek to
sub2uate and pacify the workin classes by means of a paternalistic welfare state, the purpose of
which would be to essentially co-opt and destroy workin class movements for self-determination.
3ence, the rise of +abianism, Proressivism, Social #emocracy and the )ew *lass bureaucrats and
intellectuals critici%ed by thinkers ranin from 4eore 5rwell to 6ames &urnham. "odern state
systems have created what is larely a two-tiered class structure that in many ways mirrors the feudal
system of old.
Professor 1homas #ye of +lorida State ,niversity estimates that the number of true powerholders in
American society amounts to approximately seven thousand people. 1his fiure includes those who
hold the top positions in overnment, corporate, educational, cultural, leal and civic institutions. It is
this tiny oliarchy, seven thousand people in a nation of nearly three hundred million, that miht be
said to constitute the rulin class proper in American society, comparable to the royal families of old.
#irectly beneath them in the class structure are the )ew *lass apparatchik who have replaced the
feudal aristocracy, the *hurch and the industrial boureoisie in the domination of the economic,
cultural and educational life of the society. 4eore 5rwell described this element7
1he new aristocracy was made up for the most part of bureaucrats, scientists, technicians, trade-union
orani%ers, publicity experts, socioloists, teachers, 2ournalists and professional politicians. 1hese
people, whose oriins lay in the salaried middle class and the upper rades of the workin class, had
been shaped and brouht toether by the barren world of monopoly industry and centrali%ed
overnment.
It is for the benefit of this class that most state intervention into the economy and into society is done.
It is this class who are the primary beneficiaries of the most extravaant entitlements such as social
security, "edicare, civil service pensions and aricultural subsidies. It is the )ew *lass who make their
livin staffin the overnment!s social enineerin prorams, teachin in state schools and universities,
workin for state-financed foundations and manain the bureaucracy of corporations that are
dependent on state subsidies and contracts. 1ariffs and other forms of protectionism are set up in part to
protect the employment interests of state-connected unions. Professional licensin schemes create
monopolistic uilds for )ew *lass professionals. 8onin and land use reulations serve to inflate the
real estate values of affluent )ew *lass property owners. 1hese examples are 2ust a drop in the bucket.
1he lower tier of this system of artificial class stratification includes rank and file workers and lower
manaement who are the most burdened by personal income, payroll, excise and other taxes and whose
labor marketability is devalued throuh state intervention, persons unemployed by state actions that
constrict the supply of employment opportunities, persons sub2uated by the state!s welfare system,
poor and minority persons herded into the urban reservations of 0public0 housin, persons rendered
homeless by the state!s constriction of the supply of available and affordable housin, small
businessmen and self-employed persons reulated to death by coercive state aencies, farmers
dispossessed of their traditional lands by state-supported aribusiness cartels and central banks, persons
made disabled or infirm by state constriction of available and affordable medical care, persons
dispossessed of homes and lands by eminent domain and asset forfeiture laws, those who livelihoods
are releate to the 0illeal0 market by the state -amblers, peddlers, vendors, bears, dru sellers,
prostitutes, loansharks, smulers, etc./, persons imprisoned in the state!s ulas, psychiatric prisons
-0mental hospitals0/, educational prisons -0public schools0/, pseudo-military concentration camps
-0boot camps0/ and so on. 1hese and other similar roups constitute the modern 0proletariat0, to use a
classical term. 1he modern version of the 0class strule0 involves the onoin brutal conflict between
those who most benefit from the system of mass democratic, special interest-dominated, welfare-
warfare corporate statism on one hand and those who are most victimi%ed by it on the other hand.
As a revolutionary anarcho-socialist, I aim to abolish the state!s military forces, police, courts,
prisons, schools, social enineerin prorams, welfare system, corporate charters and corporate laws,
anti-discrimination statutes, state ownership of land, currency monopoly, subsidies to infrastructure,
reulatory aencies, trade restrictions, licensin schemes and so forth. In short, I aim to abolish the
state altoether. 5n this point, market anarchists and I would aree. 3owever, I also wish to o a step
further and convert from an economic order where capital commands labor to one where labor
commands capital. 1he pertinent 'uestion at this point is the matter of how this can be done without a
coercive state apparatus. Indeed, a systemic economic conversion of this type must be done non-
coercively and without a state. 5therwise, the centrali%ation of capital into the hands of the state would
produce a new type of rulin class as we have seen in such political deenerations as the Soviet ,nion,
Peoples! 9epublic of *hina, #emocratic 9epublic of :ietnam and so on.
I have noticed that many if not most market anarchists and libertarians take the corporate dominated
economy for ranted. +or them, a 0free market0 is simply the present system minus taxes, welfare and
overnment social service aencies. As a correlation to this, most anarcho-socialists foolishly re2ect the
free market, viewin it as a source of 0capitalist exploitation0. &ut authentic free market economics
provides the proper path to workin class liberation. 1he removal of state-imposed impediments to
economic activity ; taxes, reulations, prohibitions, licenses, currency monopoly, patents, subsidies ;
would naturally result in the dramatic expansion of the 'uantity and variety of businesses, partnerships
and entrepreneurial associations of virtually every kind. If mutual banks of the Proudhonian variety
were allowed to issue private banknotes with the output of future production used as collateral, then the
capacity for self-employment would be readily available for anyone with marketable skills. A dramatic
increase in the number of businesses and employers would mean that workers would have a much
larer number of potential employers to choose from in addition to reatly expanded opportunities for
self-employment. 1his would in turn radically increase the barainin power of workers in terms of
their dealins with employers. 1he cost of wae labor would increase as the market for employees
became drastically more competitive. $orkers in lare-scale industrial operations would have the
option of demandin the riht of self-manaement if they so desired and, iven the expanded
availability of credit and capital, workers would be able to buy out capitalists and essentially become
their own employers. So the dominant forms of economic orani%ation in an authentic free market
would be worker-owned and operated industries, partnerships, cooperatives, a mass of small
businesses, modestly si%ed private companies and self-employed persons. Industries that remained
nominally owned by outside shareholders would larely function on a co-determined basis, that is, as
partnerships between shareholders and labor with labor havin the upper hand. So the traditional
anarcho-syndicalist ideal of an industrial system owned and operated by the workers could, for the
most part, be achieved in the context of a stateless free market.
9emoval of statist obstacles to the creation of housin and health care and the production of services
would simultaneously increase the supply and reduce the cost of such oods. As the overall cost of
livin declined, workers would be able to work less, retire at an earlier ae or opt for part time
employment. A stable currency would stall the advancement of inflation thereby increasin the security
of elderly and retired persons. 9ents, mortae payments and credit debts would undero an overall
decrease and home ownership would become more accessible to the averae workin person. 4reater
accessibility to land resultin from the elimination of federal overnment and aribusiness related land
monopolies and the application of the homesteadin principle would result in the revival of traditional
family farms. Similarly, a lowered cost of livin would reduce the need for two-income households
thereby revivin traditional households and increasin the deree of attentiveness of parents to
children. It would probably take volumes to completely describe the effect that the removal of the state
would likely have on the nature and structure of the economy and the types of institutions that miht
exist in an anarcho-socialist system. Suffice it to say that such a system would be as different from
what we are familiar with as the current system is from the old feudal order.
1he 'uestion of ettin there from here is obviously a monumental one. #rastic reconstructions or
alterations of social systems usually follow a crisis of some severe sort. 1he conversion to an entirely
different order, of whatever kind, will likely occur after the current system has run its course. A social
apocalypse of this type may not be that far away. Professor 3oppe has warned of the likely
conse'uences of the path currently bein pursued by the welfare-warfare corporate states of the
advanced countries. As the liabilities of modern states for social insurance payments and public debts
become ever more exorbitant, taxes and bureaucracy consume more and more of the ross national
product, real waes and productivity decline, and currency devaluation continues, an eventual
economic meltdown seems 'uite likely. 1hese factors combined with military-imperial overstretch and
persistent ethnic and cultural strife enerated by the state!s 0divide and con'uer0 stratey of population
control may well result in an overall systemic collapse similar to that experienced by the communist
states of the .ast. 1he type of politico-economic system that would emere after such an event is
obviously 'uite difficult to predict.
(ike *onfucious, "achiavelli and 3ume before him, and "ises and 9othbard later on, &akunin
reconi%ed that a natural aristocracy of cultural and intellectual leaders typically set the tone of the
society. 3e conceived of the idea of 0principled militants0 leadin lare popular orani%ations and
carryin out social reconstruction by example and inspiration. 1o some deree this was reali%ed by the
&akuninist-influenced Spanish anarchist movement with the core of militants and intellectuals athered
around the Iberian Anarchist +ederation -+AI/ leadin the much, much larer anarchist labor
movement. 1he :elvet 9evolutions of .astern .urope featured intellectuals such as :aclav 3avel as de
facto leaders of a broader popular revolt. 3oppe specifically recommended the application of a
modified version of the traditional syndicalist proram to the economies of the .astern .uropean
nations. 1hey would have done well to heed his advice. +ollowin a similar revolution in the $est,
popular orani%ations would have to emere whose leaders were committed to anarchist ob2ectives.
1here are 0non-market0 anarcho-socialists as well as advocates of the 0free market socialism0 that I
have outlined above. Prototypes for non-market socialism already exist in the form of the various
intentional communities to be found here and there. 1here is such a community about an hour!s drive
from my residence that has been in existence for about thirty years and maintains a steady population
of about one hundred or so. It is possible that communes of a hundred people could be rouped
toether with one another into larer units of, say, ten communes who were then federated with ten
other roups of ten communes and so on thereby creatin a fairly lare anarcho-communist federation
involvin tens of thousands of people. 3owever, the larer such activities became the more an explicit
market would be needed for the determination of prices and the productive allocation of resources. I
have come across some anarcho-communists who believe it is possible to have a lobal communist
system that includes a form of central plannin that does not involve a state, but the less said about
such ideas the better, in my view.
1he sustainability of a socialist-anarchist economy would larely be dependent upon the natural
system of checks and balances resultin from the dramatic alteration of the labor market that would
occur followin the abolition of the state. Additional checks and balances miht involve the makin of
shares in worker owned industries non-marketable and the definin of property rihts accordin to
usufructuary -ownership based on use and occupation/ rather than (ockean principles as an
impediment to the centrali%ation of control over resources. It is on this point that there is likely to be
the reatest amount of disareement between anarcho-socialists and market anarchists. I believe the
two can co-exist. 1he overall society-wide meta-system that I favor is one of local option. Some
communities could choose to reconi%e absentee ownership rihts while others miht not. 1he end
result miht be a eoraphical division similar to that found in the current American states where local
laws pertainin to capital punishment, amblin, the reulation of alcohol, etc. differ from place to
place. 5ther issues on which anarchists and libertarians often disaree ; abortion, animal rihts,
ecoloy, children!s rihts ; miht be handled in a similar manner. (astly, it is widely reconi%ed that
the survival of any social system is larely dependent on, first, the consensus of the cultural and
intellectual elite, and, secondly, popular opinion. 5ver time, customs, traditions and habits miht
develop that were conducive to the maintenance of the anarchist system throuh diffuse sanctions and
social pressure. As 6efferson said, 0.ternal viilance is the price of liberty.0
As for the specific 'uestion asked by a reader related to the issue of how a $al-"art or "c#onald!s
miht be communali%ed, I am skeptical as to whether or not lare retail and fast food chains of the type
we are currently familiar with could even exist in a enuine free market. 1he success of these chains
results from their ability to undercut their local competitors with lower prices. &ut their lower prices
are possible only because of the massive state subsidies to truckin, shippin, infrastructure, aviation,
etc. If such corporations had to cover their own costs in these areas, they miht not be able to compete
with local alternatives. &arrin such a scenario, however, I suspect these industries miht be
0communali%ed0 throuh either an employee buyout or throuh implementation of a eneral strike for
worker self-manaement. 1here is also the possibility of a buyout by federations of community,
environmental, consumer and other types of popular orani%ations. Saul Alinsky once envisioned an
industrial system where lare roups of small shareholders meet in stadiums to determine corporate
policy. $hether this would be feasible or not, I!m not sure. &ut it!s an interestin idea.
(astly, let me say that I consider market anarchists and other libertarians to be valuable and reliable
allies in the broader strule aainst the state itself. I reard this strule as the overridin priority. I
believe there is plenty of room for different economic beliefs and institutions to co-exist 2ust as it is
possible for a plurality of cultures, reliions and ethnic roups to co-exist as well. I am sympathetic to
anyone who is in sincere opposition to what )ock described as 0our enemy, the state0. 1o use a sloan
that some would reard as an oxymoron, 0Anarchists ,nite<0