Benjamin Tucker: Individualist Libertarian Market Socialist
By Nicholas Evans

The tradition of the American Individualist Libertarians (Libertarian Market Socialism)

American Individualist Libertarianism is a form of market socialism with self-employed individuals, co-operative businesses, and socialist employers. 1. (If your interested, please see: Benjamin Tucker’s State Socialism and Anarchism: Where they Agree and where they Differ) It differs from Mutualist market socialism because mutualist market socialism also has an agro-industrial federation and a regulated market (regulated market by the community or federation) to ensure equality of opportunity. 2. (If your interested, please see: Proudhon’s Principle of Federation)

What is Capitalism?

Capitalism is a competitive market system where the majority of businesses operate in a situation where an employer pays themselves more money than their employees for an equal amount of time working. 3.

What is Socialism?

Socialism * is any economic system where workers are paid enough in wages to have the ability buy back everything they produce or where workers own a business or workplace collectively or individually (individually would be self employed).

Therefore employers who pay their employees enough to buy back the value that they produced, employers who pay themselves equally with their employees, co-op businesses, publicly owned workplaces and self-employed businesses are socialist. 4.

What is market socialism?

Market socialism includes employers who pay themselves equally with their employees, co-op businesses, and self-employed businesses on a competitive market. 6. As the economist Stanford notes:

“But capitalism is not the only economic system which relies on markets. Pre-capitalist economies also had markets-where producers could sell excess supplies of agricultural goods or handicrafts, and where exotic commodities (like spices or fabrics) from far-off lands could be purchased. Most forms of socialism also rely heavily on markets to distribute end products and even, in some cases, to organize investment and production. So markets are not unique to capitalism, and there is nothing inherently capitalist about a market.” 7.

What is Libertarianism?

This term Libertarian is another name for the political society of Anarchism. Contrary to popular thought, anarchism is an organized and free society with equality of opportunity and it is different from Capitalism. Most forms of anarchism are based on direct democracy. This means that almost all or all organizations in an anarchist society are organized from the bottom up in a directly democratic fashion. This means that all or almost all business, workplaces, neighborhood assemblies, federations ect. would be organized in a directly democratic fashion. 8. In this sense, there are delegates, or representatives rather then rulers. As most or all of the society would be run from the bottom up by directly democratic organizations and businesses and with elected delegates or representatives, Proudhon called this philosophy Anarchism. Bakunin, Kropotkin and others followed by calling their forms of political views anarchism by building off of Proudhon’s views. The term ‘Libertarian’ was first used in the anarchist journal ‘La Libertaire, Journal du Mouvement Social’. It was published in New York between 1858 and 1861 by French Anarchist Joseph Dejacque. Benjamin Tucker used the term ‘Libertarian’ in 1897 in his journal Liberty, no. 350 pp 5. 9. ‘Libertarian’ is a nice term since ‘Anarchism’ is sometimes confused with disorder which is incorrect.

Libertarians understand that equality of opportunity is important whether in a market or collectivist systems ect. This is why libertarians are socialists. 10.

Radical capitalists have different views, as can be seen from their beliefs that Henry Ford of Ford motors has equal footing with a small farmer when it comes to setting prices on the market:

“‘There is an all-too-common assumption, however, that if we compare, say, Henry Ford and a small wheat farmer, the two differ enormously in their respective powers of control. It is be­lieved that the wheat farmer finds his price “given” to him by the market, while Ford can “administer” or “set his own” price. The wheat farmer is allegedly subject to the impersonal forces of the market, and ultimately to the consumer, while Ford is, to a greater or lesser extent, the master of his own fate, if not indeed the ruler of the consumers. Further, it is believed that Ford’s “monopoly power” stems from his being “large” in relation to the automobile market, while the farmer is a “pure competitor” because he is “small” compared to the total supply of wheat. Usually, Ford is not considered an “absolute’‘ monopolist, but someone with a vague “degree of monopoly power.

In the first place, it is completely false to say that the farmer and Ford differ in their control over price. Both have exactly the same degree of control and of noncontrol: i.e., both have absolute control over the quantity they produce and the price which they attempt to get; and absolute noncontrol over the price-and-­quantity transaction that finally takes place. The farmer is free to ask any price he wants, just as Ford is, and is free to look for a buyer at such a price. He is not in the least compelled to sell his produce to the organized “markets” if he can do better else­where. Every producer of every product is free, in a free-market society, to produce as much as he wants of whatever he possesses or can purchase and to try to sell it, at whatever price he can get, to anyone he can find.’” 11. **

This view may be ignoring market power. Market power is a situation where a company can afford to buy a lot more machinery and wage-workers, and therefore producing products that are perceived to be much better quality then a self employed individual can make (since the self employed individual may not have the machinery to make products in order to compete with the company on the market). Being free from most competition, the company can generally set prices they want. 12. The libertarians understood this, which is why the individualists are market socialists and all other libertarians are socialists. 13.

Even though the Individualists supported socialist wage labor, they knew the hierarchy was truly voluntary as the economy would be free of unearned capitalist income and free from market power:

“…it will make no difference whether men work for themselves, or are employed, or employ others. In any case they can get nothing but that wage for their labor which free competition determines.” 14. in other words the worker’s wage would be enough for the worker to buy back on the market the general value of what their job generally creates.

In a radical capitalist society, the capitalist wage-labor may be involuntary as the wage-worker may have no means to compete with the larger well-off companies so have no choice but to became a wage worker. The hierarchy would be involuntary and therefore un-libertarian.

Benjamin Tucker obviously knew this, and he knew about market socialism and socialist wage labor. 15. This is why he is a socialist and why he called himself a socialist. 16.



* Marx’s authoritarian politics are different from his analysis of capitalism and maybe contradict, since the state would act as one big corporation, the workers would neither receive the full value of their work or control the workplaces directly (ie. Worker self management) However, his analysis of Capitalism is used by most socialists and accepted by the mainstream economics and by Libertarians such as Bakunin.

His analysis of Capitalism is one thing of course, his political side (authoritarian politics in order to apply Socialism) is another thing as his analysis is different and can be applied to authoritarian as well as Libertarian societies. Please see: ‘State Socialism and Anarchism’ by Benjamin Tucker and “Like Marx, Bakunin emphasized the importance of the economic factor of social evolution…In criticizing Marx’s theory of the State, Bakunin maintained that the State is not merely an agent of dominant economic class, but also constitutes a class in itself, and the most powerful of all by its virtue of its monopoly of armed force and its sovereignty over all other social institutions.” (Dolgoff, Sam (editor) Bakunin On Anarchy. New York: Vintage Books., (1972) pp 4-5)

As for Marx’s Labor Theory of Value, it has been critiqued correctly by Steve Keen, Joan Robinson (Keen, Steve. Debunking Economics: The Naked Emperor of the Social Sciences. Zed Books: New York. (2004) pp 278-299) and others as incorrect with regards to labor and prices. However as McKay notes, Marx knew this which is why he stated:
“Ironically, the classical economists would agree. Marx, for example, explicitly noted that price and value do not actually equate:
"The continued oscillations in prices, their rise and fall, compensate each other . . . and carry out their own reductions to an average price, which is their internal regulator . . . the problem of the formation of capital . . . [is]: How can we account for the origin of capital on the supposition that prices are regulated by the average price, i.e., ultimately by the [labour] value of the commodities. I say 'ultimately,' because average prices do not directly coincide with the [labour] values of commodities." [Capital, Vol. 1, p. 269fn]” (McKay Iain. An Anarchist FAQ Blog: Unfinished Appendix on the Labour Theory of Value (11-25-2008) Retrieved 8-10-2009 from: anarchism.pageabode.com/blogs/afaq/secCapp.html)

Marx was working at a very abstract level in his analysis that was not meant to reflect reality but to show that the basis of work is the source of all value. However, as the economist Stanford points out there need not even be a Labor Theory of Value from Marx (or Proudhon or Tucker ect.) to show the labor is the source of all productivity. As the economist Stanford notes: “…Sraffa still proved that an inverse relationship must exist between wages and profits: if one is higher, the other must be lower. This was utterly contrary to the conclusion of neoclassical economists that labour and capital have complementary interests, rather then conflicting interests.” (Stanford, Jim. Economics for Everyone: A Short Guide to the Economics of Capitalism. Ann Arbor: MI., Pluto Press. 2008. pp 72)

** Radical Capitalists have noted they are different from anarchists (ie. Libertarians):

“We must therefore conclude that we are not anarchists, and that those who call us anarchists are not on firm etymological ground, and are being completely unhistorical…Then, when, in the jousting of debate, the inevitable challenge ‘are you an anarchist?’ is heard, we can, for perhaps the first and last time, find ourselves in the luxury of the "middle of the road" and say, ‘Sir, I am neither an anarchist nor an archist, but am squarely down the nonarchic middle of the road.’” Rothbard, N. Murray. ‘Are Libertarian’s ‘Anarchists’?’ Ludwig von Mises Institute re-print 2008 (original mid- 1950’s in the article Faith and Freedom under the name "Aubrey Herbert," article was never published) retrieved August 30, 2009 from: www.lewrockwell.com/rothbard/rothbard167.html

(note: Radical Capitalists started to use the term ‘Libertarian’ in the 1970’s. “Unfortunately, in the United States the term “libertarian” has become, since the 1970s, associated {to some-ed} with the right-wing,…” radical Capitalists. However, the term Libertarian has been used for over 150 years before to describe a direct democratic society that is economically socialist {ie. Market socialism, collectivism, Gift Economy ect.} as noted in the above article.) {also please see footnote 9}



Bibliography and Footnotes:

1. “The economic principles of Modern Socialism are a logical deduction from the principle laid down by Adam Smith in the early chapters of his "Wealth of Nations," - namely, that labor is the true measure of price.” and “…it will make no difference whether men work for themselves, or are employed, or employ others. In any case they can get nothing but that wage for their labor…” Tucker, Benjamin. Instead of a Book: By a Man too Busy to Write One. New York: Gordon Press. (1972) pp 5 and pp 475 ‘State Socialism and Anarchism’ and fair-use.org/benjamin-tucker/instead-of-a-book/solutions-of-the-labor-problem

2.Vernon, Richard (editor) Proudhon, Joseph-Pierre The Principle of Federation. Canada: University of Toronto Press., 1979 pp 70 and 72
“The agro-industrial federation, on the other hand, will tend to foster increasing equality, by organizing all public services in an economical fashion…industries are sisters; they are part of the same body… They should therefore federate… in order to guarantee mutually the conditions of common prosperity…”
And
Edwards, Stewart (Editor) Selected Writings of P.-J. Proudhon. Garden City, New York: Anchor Books., 1969 pp 70
“The advocates of mutualism are as familiar as anyone with the laws of supply and demand and they will be careful not to infringe them. Detailed and frequently reviewed statistics, precise information about needs and living standards, an honest breakdown of cost prices, the forseeing of all eventualities, the fixing after amicable discussion of a maximum and minimum profit margin, taking into account the risks involved, the organization of regulating societies: these things, roughly speaking, constitute all the measures by means of which they hope to regulate the market.”

3. Evans, Nicholas. ‘Libertarian Mutualism in Libertarian Spain’ (2008) and Marx states “The driving motive and determining purpose of capitalist production is the self-valorization of capital to the greatest possible extent ie. The greatest possible production of surplus value,…” Marx, Karl. Capital Volume 1 England: Penguin Classics (reprint) 1990 pp. 449
As does Kropotkin:
“…the capitalists to appropriate for themselves a quite disproportionate share of the yearly accumulated surplus of production…” Kropotkin, Peter., Anarchism (1910) Encyclopedia Britannica. Retrieved Feb. 10, 2009 from:
dwardmac.pitzer.edu/Anarchist_Archives/kropotkin/britanniaanarchy.html
In a Capitalist business, an employer pays themselves more money than their employees for an equal amount of time working. Surplus value is the money the employer receives which would have been the employees if the employer and employee were paid equally. Also please see: What is Surplus Value? McKay, Iain. The Anarchist FAQ Oakland: AK Press., 2008 pp 229 Also available online at: www.infoshop.org/faq/secC2.html

4. Marx, Karl. Capital Volume 1 England: Penguin Classics (reprint) 1990 pp. 676.
"The working day of 12 hours is represented in a monetary value of, for example, 6 shillings. There are two alternatives. Either equivalents are exchanged, and then the worker receives 6 shillings for 12 hours of labour; the price of his labour would be equal to the price of his product. In that case he produces no surplus-value for the buyer of his labour, the 6 shillings are not transformed in to capital, and the basis of capitalist production vanishes."
And Proudhon states:
Edwards, Stewart (Editor) Selected Writings of P.-J. Proudhon. Garden City, New York: Anchor Books., 1969 pp 64
“I will place a condition upon my service: the man who wishes to employ me as a servant must pay me fifty per cent of his income. Without this we are beyond the bounds of fraternity, equality, and mutuality.”
Proudhon, Pierre-Joseph General Idea of the Revolution in the Nineteenth Century. New York: Cosmo Classics., 2007 pp 217
“Anybody who is capable of cutting out and sewing up a pair of shoes can get a license, open a shop, and hang out a sign, ‘So and So, Manufacturing Shoe Merchant’ although it may only be himself behind his counter.” and Proudhon, Pierre-Joseph General Idea of the Revolution in the Nineteenth Century. New York: Cosmo Classics., 2007 pp 217
“By participating in the loss and gains, by the graded scale of pay, and successive promotion to all grades, the collective force, which is a product of the community, ceases to be a source of profit to a small number of managers and speculators: it becomes the property of all workers. At the same time, by a broad education, by the obligation of apprenticeship, and by the co-operation of all who take part in the collective work, the division of labor can no longer be a cause of degredation for the workman: it is on the contrary…” ibid. pp 213And
Marx states:
"Political economy confuses, on principle, two very different kinds of private property, one of which rests on the labour of the producer himself, and the other on the exploitation of the labour of others. It forgets that the latter is not only the direct antithesis of the former, but grows on the former's tomb
and nowhere else . . . the capitalist regime constantly comes up against the obstacle presented by the producer, who, as owner of his own conditions of labour, employs that labour to enrich himself instead of the capitalist. The contradiction of these two diametrically opposed economic systems has its
practical manifestation here in the struggle between them." Ibid. Marx. pp 931

5. "Labour financed by the State - such is the fundamental principle of authoritarian Communism, of State Socialism. The State, having become the sole proprietor . . . will have become sole capitalist, banker, money-lender, organiser, director of all national work, and the distributor of its profits." [The Political Philosophy of Bakunin, p. 293]” And:
"Marxian socialism advocates the centralisation not only of political power but also of capital. The centralisation of political power is dangerous enough in itself; add to that the placing of all sources of wealth in the hands of the government, and the so-called state socialism becomes merely state capitalism, with the state as the owner of the means of production and the workers as its labourers, who hand over the value produced by their labour. The bureaucrats are the masters, the workers their slaves. Even though they advocate a state of the dictatorship of workers, the rulers are bureaucrats who do not labour, while workers are the sole producers. Therefore, the suffering of workers under state socialism is no different from that under private capitalism." [Ou Shengbai, quoted by Arif Dirlik, Anarchism in the Chinese Revolution, p. 224]
Mackay, Iain; Elkin, Gary; Neal, Dave; Boraas, Ed., An Anarchist FAQ. Section H.3.13 “Why is State Socialism Just State Capitalism?” An Anarchist FAQ Collective: International (1996-present) Retrieved 8-10-2009 from: Retrieved 8-10-2009 from: www.infoshop.org/faq/secH3.html

6. Marx, Karl. Capital Volume 1 England: Penguin Classics (reprint) 1990 pp. 676.
"The working day of 12 hours is represented in a monetary value of, for example, 6 shillings. There are two alternatives. Either equivalents are exchanged, and then the worker receives 6 shillings for 12 hours of labour; the price of his labour would be equal to the price of his product. In that case he produces no surplus-value for the buyer of his labour, the 6 shillings are not transformed in to capital, and the basis of capitalist production vanishes." And "Political economy confuses, on principle, two very different kinds of private property, one of which rests on the labour of the producer himself, and the other on the exploitation of the labour of others. It forgets that the latter is not only the direct antithesis of the former, but grows on the former's tomb
and nowhere else . . . the capitalist regime constantly comes up against the obstacle presented by the producer, who, as owner of his own conditions of labour, employs that labour to enrich himself instead of the capitalist. The contradiction of these two diametrically opposed economic systems has its
practical manifestation here in the struggle between them." Ibid. Marx. pp 931
And
Edwards, Stewart (Editor) Selected Writings of P.-J. Proudhon. Garden City, New York: Anchor Books., 1969 pp 64
“I will place a condition upon my service: the man who wishes to employ me as a servant must pay me fifty per cent of his income. Without this we are beyond the bounds of fraternity, equality, and mutuality.” and Proudhon, Pierre-Joseph General Idea of the Revolution in the Nineteenth Century. New York: Cosmo Classics., 2007 pp 217
“Anybody who is capable of cutting out and sewing up a pair of shoes can get a license, open a shop, and hang out a sign, ‘So and So, Manufacturing Shoe Merchant’ although it may only be himself behind his counter.” and Proudhon, Pierre-Joseph General Idea of the Revolution in the Nineteenth Century. New York: Cosmo Classics., 2007 pp 217
“By participating in the loss and gains, by the graded scale of pay, and successive promotion to all grades, the collective force, which is a product of the community, ceases to be a source of profit to a small number of managers and speculators: it becomes the property of all workers. At the same time, by a broad education, by the obligation of apprenticeship, and by the co-operation of all who take part in the collective work, the division of labor can no longer be a cause of degredation for the workman: it is on the contrary…” ibid. pp 213

7. Stanford, Jim. Economics for Everyone: A Short Guide to the Economics of Capitalism. Ann Arbor: MI., Pluto Press. 2008. Pp. 36

8. “We want the mines, canals, railways handed over to democratically organised workers' associations" which would be the start of a "vast federation of companies and societies woven into the common cloth of the democratic social Republic." [No Gods, No Masters, vol. 1, p. 62 and p. 105]
Mackay, Iain; Elkin, Gary; Neal, Dave; Boraas, Ed., An Anarchist FAQ. Section H.3.13 “Why is State Socialism Just State Capitalism?” An Anarchist FAQ Collective: International (1996-present) Retrieved 8-10-2009 from: www.infoshop.org/faq/secH3.html Also please see: Section I.5.1: What are participatory communities?
www.infoshop.org/faq/secI5.html
“The key to that change, from the anarchist standpoint, is the creation of a network of participatory communities based on self-government through direct, face-to-face democracy in grassroots neighbourhood and community assemblies.”
I.3.2 What is workers' self-management?
www.infoshop.org/faq/secI3.html
“Quite simply, workers' self-management (sometimes called "workers' control") means that all workers affected by a decision have an equal voice in making it, on the principle of "one worker, one vote." That is, workers "ought to be the real managers of industries." [Peter Kropotkin, Fields, Factories and Workshops Tomorrow, p. 157]”

9. AFAQ Blog. 150 Years of Libertarian. Anarchist Writers: AFAQ’s Blog (12/11/2008) Retrieved July 27, 2009 from: anarchism.pageabode.com/afaq/150-years-of-libertarian The AFAQ has been regarded as “…very comprehensive…” by Graham, Paul; Hoffman, John. Introduction to Political Ideologies London: Pearson/Longman. (2006) pp 109 And as an "exemplar of the principles…” of community governing by Harvard resident fellow Joseph Reagle in: Why the Internet is Good - Community governance that works well Berkman Center for Internet and Society: Harvard Law School
(1998) Retrieved June 20, 2009 from: cyber.law.harvard.edu/archived_content/people/reagle/regulation-19990326.html

10. Please see: Kropotkin, Peter., Anarchism (1910) Encyclopedia Britannica. Retrieved July 27, 2009 from: dwardmac.pitzer.edu/Anarchist_Archives/kropotkin/britanniaanarchy.html

11. Rothbard, Murray. Man, Economy, and State. Alabama: The Ludwig von Mises Institute. (2001) Pp 588 Available on-line at: mises.org/rothbard/mes/chap10b.asp

12. Market power: “The ability of a single, or group of buyer(s) or seller(s) to influence the price or service in which it is trading.” Pearce, David. The MIT Dictionary of Modern Economics. Cambridge Massachusetts: The MIT Press (1992) pp 268 While the this dictionary is nice, it unintentionally has some misinformation about anarchism. Contrary to what it states as the definition of anarchism, anarchism has always been and is a socialist movement. It is socialist for reasons stated in this article among other reasons.

13. Edwards, Stewart (Editor) Selected Writings of P.-J. Proudhon. Garden City, New York: Anchor Books., 1969 pp 195 Proudhon the Libertarian Mutualist (Market Socialist) states: “…I am a socialist…”, as does the Libertarian Collectivist Bakunin: “Liberty without socialism is …injustice…” Dolgoff, Sam (editor) Bakunin On Anarchy. New York: Vintage Books., (1972) front page. and Tucker: "liberty insists on Socialism. . . - true Socialism, Anarchistic Socialism: the prevalence on earth of Liberty, Equality, and Solidarity." Tucker, Benjamin. Instead of a Book: By a Man too Busy to Write One. New York: Gordon Press. (1972) pp 363 and Kropotkin: “As to their economical conceptions, the anarchists, in common with all socialists, of whom they constitute the left wing, maintain that the now prevailing system of private ownership in land, and our capitalist production for the sake of profits, represent a monopoly which runs against both the principles of justice and the dictates of utility.”
Kropotkin, Peter., Anarchism (1910) Encyclopedia Britannica. Retrieved July 27, 2009 from: dwardmac.pitzer.edu/Anarchist_Archives/kropotkin/britanniaanarchy.html

14. Tucker, Benjamin. Instead of a Book: By a Man too Busy to Write One. New York: Gordon Press. (1972) pp 475 and available online at: fair-use.org/benjamin-tucker/instead-of-a-book/solutions-of-the-labor-problem

15. Please see footnote: 1. and 4.

16. Please see footnote: “But the very reasonable and just criticisms of the individualists of this stripe upon State Socialism, when analyzed, are found to be directed, not against the Socialism, but against the State. So far Liberty is with them. But Liberty insists on Socialism, nevertheless,- on true Socialism, Anarchistic Socialism: the prevalence on earth of Liberty, Equality, and Solidarity.” Tucker, Benjamin. Instead of a Book: By a Man too Busy to Write One. New York: Gordon Press. (1972) pp 363

Excellent Links:

An Anarchist FAQ. For a society based in direct democracy, federation, and equality of opportunity is available online here:

www.anarchistfaq.org

The AFAQ has been regarded as “…very comprehensive…” by Graham, Paul; Hoffman, John. Introduction to Political Ideologies London: Pearson/Longman. (2006) pp 109 And as an "exemplar of the principles…” of community governing by Harvard resident fellow Joseph Reagle in: Why the Internet is Good - Community governance that works well Berkman Center for Internet and Society: Harvard Law School
(1998) Retrieved June 20, 2009 from: cyber.law.harvard.edu/archived_content/people/reagle/regulation-19990326.html


Nicholas Evans is interested in Economics, history and anthropology. Mr. Evans prefers peaceful and/or gradual change