Anarkismo.net: Kevin Carson?s Revival of Individualist Anarchist Economic Theory by Wayne Price

Review of Kevin A. Carson, "Studies in Mutualist Political Economy" (2007); 366 pages.
This is a review of Kevin Carson's "Studies in Mutualist Political Economy". Carson seeks 
to revive individualist anarchist economic theory. Taking from Marxist and pro-capitalist 
economic theories, he tries to develop an anarchist economics which can analyze existing 
capitalism as well as provide a model for a market-based but non-capitalist stateless 
economy. ---- Kevin Carson?s Revival of Individualist Anarchist Economic Theory ---- Kevin 
Carson is attempting to resurrect anarchist economic theory. This is interesting because 
most current anarchist political economy is speculation about a post-capitalist, 
post-revolutionary, economy?what it would look like and how it might work. There is little 
or nothing of an analysis of how present-day capitalism functions.

For that, most anarchists either rely on some variety of conventional (pro-capitalist) 
economics or they look to aspects of Marxism. The latter is the strategy I used in my book 
(Price 2013)?with the subtitle, ?an anarchist introduction to Marx?s critique of political 
economy.? There have been anarchists using Karl Marx?s economic views?while rejecting his 
statist politics?beginning with Michael Bakunin. (And there has always been a minority of 
Marxists who look toward the more libertarian and humanistic side of Marx?s work, whose 
politics are close to anarchism.)

Carson seeks to revive the anarchist economic school of ?mutualism? (the theory of P.J. 
Proudhon, the first person to call himself an ?anarchist?). It was developed further by 
the 19th century U.S. individualist anarchists (J. Warren, L. Spooner, and especially 
Benjamin Tucker). He acknowledges, ?Unfortunately, individualist anarchist economic 
thought has for the most part been frozen in a time warp for over a hundred years.? (xvi) 
Within anarchism, it was overtaken by anarchist-communism. It died out, with remnants 
being assimilated into alien theories of ?libertarian? capitalism and so-called 
?anarcho-capitalism.? To attempt to revive mutualist theory, Carson derives ideas from 
capitalist economics, including ?libertarian? capitalist economists, and a great deal from 
Marxism (he frequently cites either Marx or Marxists).

Kevin Carson presents individualist anarchism as pro-market but anti-capitalist and even 
?socialist.? He rejects the ?anarcho-capitalist? program of capitalist corporations (with 
workers hired for wages) but without a state. A (hypothetical) mutualist economy might 
include small enterprises, shops, workshops, consumer cooperatives, and family farms. 
Instead of hired workers, enterprises would be democratically managed by their members 
(producer cooperatives). Banks would be credit unions (cooperative banks). These 
enterprises would all compete freely on the open market. There would be no state 
regulation, or state at all. ?Justice?, or at least civil peace, would be maintained 
through mostly local arrangements by the armed citizens.

This would be a commodity-producing economy but not capitalism, even by Marxist standards. 
There would be no separate class of people who owned capital nor would there be a 
specialized class of propertyless workers who had to hire themselves out to capitalists in 
order to live. Interestingly, there has been a number of non-anarchists who have also 
advocated market economies of self-managing producers? cooperatives (reviewed in Price 
April 2014).

However, it is not a very democratic social vision. Assuming that it would work, the 
community?s members would not make overall decisions about how to develop their society; 
this would be decided by competing enterprises responding to the uncontrolled market. Even 
democratically-managed enterprises would not really control their own fate; this would be 
determined by the ups and downs of the external market.

Yet I agree with much of what Carson writes, both his rejection of capitalism and his goal 
of a decentralized, stateless, society with self-managed industries. I would not object to 
some commune or region trying out his market-oriented program. This is in agreement with 
the experimental pluralism of Errico Malatesta (discussed in the Appendix to Price 2013) 
and with Carson?s own support of a pluralist ?panarchy.? But I identify with the 
revolutionary, class-struggle, socialist-anarchism of Bakunin, Kropotkin, Goldman, and 
Makhno, the anarchist-communists and the anarchist-syndicalists?as well as finding useful 
concepts in Marx. This is the viewpoint from which I review this work.

Carson?s book is divided into three parts. The first part, the most abstract, is about the 
?labor theory of value? (?the law of value?). Like Marx, the individualist anarchists 
regarded this as an important part of their theory, although the ?anarcho-capitalists? 
reject it. The second part is on ?Capitalism and the State.? He seeks to demonstrate that 
capitalist exploitation?but not the market as such?requires the state. He also gives his 
analysis of the crisis tendencies of capitalism (the book was written before the Great 
Recession of 2008). The third, and shortest, part covers his strategy for achieving 
individualist anarchism, as well as his arguments for why it would work.
The Law of Value/ Labor Theory of Value

The classical political economists (especially those in the line from Adam Smith to David 
Ricardo) developed the already existing concept of the ?labor theory of value.? According 
to this, what gives a commodity ?value? (able to have a monetary price) is basically the 
amount of work which went into making it. This influenced early British socialists as well 
as Proudhon and then the U.S. individualist anarchists. Karl Marx made it the foundation 
stone of his critique of political economy. The dominant schools of modern bourgeois 
economics reject it completely, including almost all ?anarcho-capitalists.?

Marx argued that socially necessary labor time is the root of the price of commodities on 
the market. Commodities tend to exchange for other commodities based on equal amounts of 
the average socially necessary labor time that went into producing them. Of course 
commodities must also have ?use-value? (utility), in the sense that potential buyers?not 
the capitalist producers?want to use them. Otherwise no one would buy them, and no 
capitalists would produce them. But that does not determine the market (exchange) value. 
Marx said that many factors modify this law in practice: averaging of the rate of profit, 
variations in immediate supply and demand, monopolies, etc. But the law of value remains 
underneath all such phenomena; it is how the capitalist market organizes all of society?s 
labor in the production of goods.

Carson makes some modifications in the concept. He accepts the competing theory of 
?marginal utility? (price is based on how ?useful? and how scarce consumers find this 
commodity), but only to explain the variations in commodity prices in the very short run. 
In the very short run, the amount of any specific type of commodity is fixed (there are 
only so many Camrys in the stores that week). Therefore its price is mostly determined by 
fluctuations in demand (as accounted for in the theory of marginal utility). But in the 
long run (for reproducible commodities), production will increase or decrease to meet the 
level of demand for that commodity. Over time, the price will fluctuate around the price 
of production (the cost of producing a Camry plus an average profit). Production costs are 
ultimately resolvable into the average amount of socially necessary labor.

He also feels that it is necessary to alter the value concept when explaining the 
differences between the value added to a commodity by ?simple? (unskilled) labor and by 
?complex? (trained, skilled) labor. To Marx, the latter is a multiple of the first. Carson 
prefers to compare them both on a common scale of ?the subjective disutility of 
labor?including the past disutility involved in learning particular skills.? (68) He 
derives this from Adam Smith?s subjective ?toil and trouble? as the basis for Smith?s 
theory of value.

In dealing with this issue, it is more useful to focus on what Marx called ?abstract 
labor? (value-creating labor) but not as the result of any individual workers, skilled or 
unskilled. Commodities today are not usually made by a craftsperson sitting at a bench. 
Instead they are made by what Marx called the ?collective worker? or ?aggregate worker.? 
Many working people, with many degrees of skill, training, and effort, work on each 
product (such as each car). Marx wrote, ?Some work better with their hands, others with 
their heads, one as a manager, engineer, technologist, etc., the other as overseer, the 
third as manual laborer or even drudge?.Their combined activity results materially in an 
aggregate product?.? (From the ?unpublished sixth chapter? of Capital, quoted in Cleaver 
2000; 119) The new, added, value of each car is the average time it is necessary for the 
work force to make it. In determining prices, the owners do not care about individuals, 
but about their total wage bill (among other costs) and the total time it takes to make 
new cars.
The Role of the Law of Value

Carson states that ?the general principle is that all of society?s product, in a free 
market, will go to labor; and that it will be apportioned among laborers according to 
their respective toil and trouble.? (71) This would certainly prevent any (lower-c) 
communist division of the common product among workers according to need. Yet this 
?general principle? seems to contradict his earlier (apparently approving) quotation from 
Hodgskin that ?there is no principle?for dividing the product of joint labor among the 
different individuals who concur in production but the judgment of the individuals 
themselves?nor can any rule be given for its application by any single person?.? (70)

Which raises the central issue of Carson?s discussion of the labor theory of value. 
Following the mutualist/individualist tradition, Carson regards the law of value as a 
moral imperative. Each worker should get the complete product of his or her labor, the way 
that self-employed craftspeople own the objects they make?and sell them and keep the 
money. The reason workers do not get to keep the full product they make (or its value) is 
that a profit is drained off by capitalists, bankers, merchants, landowners, and their 
agents. These robbers get profits because they are backed by the state, which distorts the 
market. In a really free market, without state interference, mutualists believe, the 
workers would get the full value of their work in their complete product?as they morally 
should. This would apply to workers in individual workshops or to groups of workers in 
producer cooperatives. The goal of individualist anarchism is to liberate the market to 
freely follow the law of value.

A different view is held by what Carson calls ?collectivists,? which includes 
anarchist-communists as well as libertarian Marxists. Markets are indeed distorted by many 
factors, including the state. But the law of value, the exchange of products based on the 
total amount of labor which goes into them, is ultimately controlling. This is illustrated 
by Carson?s example of the late Soviet Union. As he says, its planners attempted ?ignoring 
the law of value?. The final result was collapse.? (299) Because the market was so 
distorted, the planners had no accurate way to judge the costs of anything. (Also there 
was no democratic feed-back from workers and consumers.) They wasted an enormous amount, 
leading to eventual stagnation and collapse. (Unfortunately he does not understand that 
this was due to the Soviet Union having a commodity-exchanging, market, economy, even if 
collectively owned by the state. It was state capitalist?a term he saves for the U.S.)

Marx agreed that the workers did not get back their full product. He claimed that this was 
due to the capitalist system treating the ability of workers to work as a commodity?the 
?commodity labor-power.? Just like other commodities, labor power was valued at its cost 
of production (the money equivalent of the food, clothing, shelter, culture, 
entertainment, etc. necessary for the workers to be able to work the next day). The cost 
of labor-power was less than the total value which the workers could produce, which made 
profits possible. Yet labor power was still bought at its value. Hence, Marx concluded, in 
capitalist terms, profit was not ?theft? but resulted from an exchange of commodities 
(labor power for money, which could buy food, etc.) on an equitable basis. By capitalist 
market rules, that is.

Therefore, if the working class was to get back the full product it made, it would have to 
end value. This does not mean that each worker would necessarily get back the full amount 
he or she made. In a cooperative, democratically coordinated, economy, where products are 
not commodities, what the workers made would have to include some wealth used for fixing 
existing machinery and making new machines, working on the environment, taking care of the 
retired, the sick, and children, etc. And it is impossible, really, to say how much each 
person adds to the collective product (for example, cars, if they are still being 
made)?and therefore impossible to determine how much each worker ?deserves.? Methods of 
remuneration will have to be decided by the people involved, but not based on ?value.?

Carson insists that it is impossible to abolish ?value.? Any kind of production must 
include some measure of value. ?The law of value is not simply a description of commodity 
exchange in a market society; it is a fundamental ethical principle.? (339) This confuses 
two concepts. Any society must include some consideration of how it distributes labor 
among the various tasks which need to be done. This is true of a self-sufficient feudal 
manor, or a primitive patriarchal peasant farm, or a libertarian communist region. In 
these cases, the distribution of labor is consciously determined. However, in a market 
economy, labor is distributed through the exchange of commodities. Here alone is there 
?value,? determined behind the backs of the people involved, by the ?invisible hand? of 
the market (with more or less distortion by the state). True, there is also an ethical 
principle involved. Under libertarian socialism, every able-bodied adult should 
participate in production and, therefore, should share in the socially-created wealth. 
This does not require any exchange ?value.?
Capitalism and the State

The longest section of Carson?s book is ?Part Two?Capitalism and the State: Past, Present, 
and Future.? His aim is to demonstrate, historically, that there has never been a simple, 
?laissez-faire,? free market, but that the bureaucratic-military-police state has always 
been involved. He explains this very well and very clearly; it is highly worth reading. 
However, in terms of theory, there is little that is new here.

He writes, ?Marxists have (?) generally been quite ambiguous concerning the relationship 
between state coercion and economic exploitation?.Marx and Engels vacillated a great deal 
in their analysis of the role of force in creating capitalism?.? (95-96) This is entirely 
true. However, I find it useful to look at those ways in which Marx and Marxists 
?vacillate? in the direction of recognizing the dialectical interaction of the state and 
capital.

As Carson points out, Marx rejected the notions of Smith or Ricardo that capitalism just 
grew. Instead Marx described, ?in letters of blood and fire,? how the origins of 
capitalism?its ?primitive accumulation??was accomplished through violent state action and 
other non-market uses of force. The accumulation of capital in the hands of a minority of 
early capitalists, and the creation of a class of potential workers without land or 
property?the necessary basis for capitalism?was violently and bloodily accomplished.

Once capitalism was on its feet, it relied more on its own market dynamics, but it still 
needed the overall protection of the state. It was in the 19th century that Marx and 
Engels studied the difficulty of the bourgeoisie in firmly establishing its own, 
democratic, self-rule. Instead, there was an autonomous rise of the bureaucratic state, 
especially of its executive. Marx and Engels called this ?Bonapartism,? after the Empire 
of the second Bonaparte, but they applied it generally. Carson does not discuss this.

Nor does he mention that Engels described a tendency toward the full statification of 
capitalism. ?The official representative of capitalist society?the state?will ultimately 
have to undertake the direction of production?.All the social functions of the capitalist 
are now performed by salaried employees?.The workers remain wage workers?proletarians. The 
capitalist relation is not done away with.? (Engels, quoted in Price 2013; 106)

In the early 20th century, later Marxists studied the rise of capitalist imperialism and 
the growth of ?monopoly capitalism.? Of course they included the interaction and mutual 
support of big capital and the expanded imperialist state.

Anarchist-communists were as aware of the state?s economic role as the individualists 
were. Kropotkin rejected Marx?s term ?primitive accumulation,? because, he argued, state 
intervention on behalf of the capitalists was never limited just to the ?primitive? 
beginnings of capitalism. ?Nowhere has the system of ?non-intervention of the state? ever 
existed. Everywhere the state has been, and is, the main pillar and the creator, direct 
and indirect, of capitalism?.? (Kropotkin 2014; 193)

What Carson is trying to show, in this section, is that it is not the market as such which 
has caused the evils of capitalism. Rather it is state intervention in the market which 
has promoted capitalist domination and its attendant evils. He demonstrates that the state 
has always intervened in the capitalist market. But this does not prove that the market is 
possible without the state. If anything, it would seem to demonstrate that a market 
economy requires a state.

If the state created the market, the market created the state. A competitive, 
commodity-exchanging, market, has each person in conflict with every other person, each 
firm competing with every other firm. It encourages conflict, short-sightedness, and 
selfishness. It needs an overall institution to hold society together, to serve the 
overall interests of the dominant economic actors. That institution can only be a state.

He has an interesting discussion of the nature of capitalist crises. Much of what he says 
is valid, I think, but he is too much influenced by the Monthly Review school of 
neo-Marxists, with their underconsumptionist analysis (see Price Nov. 2012). For example, 
he writes, ?Paradoxically, the state?s response to over- accumulation leads directly to a 
crisis of under-accumulation.? (273) Actually it is the reverse. It is 
?under-accumulation? which is the fundamental problem, namely the inability of late 
capitalism to produce enough surplus value (profit). Since capitalists cannot find enough 
profitable new investments to make, they may be said to have an ?over-accumulation? of 
their past profits.

Carson notes that Marx and many Marxists (but not the Monthly Review theorists) believe 
that there is a tendency for the capitalist rate of profit to fall, but he does not say 
whether or not he agrees. Also, he refers to the irrational tendencies of monopolistic 
capitalism, but does not refer to Marx?s concept of ?fictitious capital,? the growth of 
paper profits unbacked by real value (by things and services actually produced through labor).
The Program of Individualist Anarchism

Class-struggle revolutionaries believe in building independent mass movements in conflict 
with the state and the capitalist class. They support struggles for limited reforms 
because these contribute to developing large-scale movements by the working class. They 
also support struggles by other oppressed groupings, including women, peasants, oppressed 
nations, People of Color, GLBT people, etc., as well as struggles on such issues as war 
and climate change. They want these movements to culminate in a popular, democratic, 
revolution which will dismantle the state, the capitalist economy, and all forms of 
oppression?and replace them with a self-managed society.

This is not Kevin Carson?s strategy. In the tradition of Proudhon and Tucker, he advocates 
building alternate institutions, piece-by-piece replacing the statist, capitalist, society 
(this is mis-called a ?dual power? strategy). It is ?a gradualist approach to dismantling 
and replacing the state?with new forms of social organization.? (320) Using the existing 
market, they will initiate producer and consumer cooperatives, small enterprises, mutual 
aid institutions, do-it-yourself collectives, community gardens, credit unions, etc. These 
tend not to directly conflict with capitalist institutions. Mutualists should also 
influence the state through ?pressure groups and lobbying? (320), but the main effort is 
the creation of alternate institutions. At some point these become strong enough to 
challenge the state, which ?will almost certainly involve at least some violence.? (318) 
But he does not expect much. For some reason, he is confident that ?the ruling 
classes?will use open, large-scale repression only as a last resort.? (318)

I am not against producer cooperatives, community gardens, etc. They are good in 
themselves and serve as good examples of an alternate society. But they are inadequate as 
a strategy for transforming society. The market is the capitalists? institution, as much 
as is the government. Cooperatives have worked very well, but only on the margins of the 
economy. Either they fail or they fail by success, that is, they do well and are 
integrated into the capitalist economy. They are unlikely to threaten the big, central, 
businesses, such as in the automobile industry, the steel industry, the oil companies, or 
the big banks. If, somehow, they really did threaten them, then the state would step in 
and try to repress the cooperatives, in as bloody a manner as ?necessary.?

Carson writes, indignantly, ?Gradualism is often falsely identified as ?reformist? by 
revolutionary anarchists.? (313) It is a false identification, he claims, because 
individualist gradualists really do want a new society, without the state or 
capitalism?the same goal as the revolutionary anarchists. However, he confuses ?reformism? 
with ?liberalism.? Liberals want to improve the existing society, to file down the rough 
edges of our chains. Reformists want a new society, but believe it can be reached by 
gradual, step-by-step, reforms. Revolutionaries believe a new society can only be reached 
by some sort of mass upheaval (not necessarily violent). By this (traditional) set of 
definitions, the imutualists are reformists.

Even if it were achieved, I doubt that the individualist anarchist system would work for 
very long. Competing on the marketplace, following the law of value, some cooperative 
firms would do better than others. There would be winners and losers. The winners would 
get bigger and wealthier, the losers would go under. A pool of unemployed workers would 
develop. There would be business cycles of expansions and recessions. Stratification would 
develop within and between the enterprises. The wealthier cooperatives and family farmers 
would dominate the ?self-defense? associations which would take over policing. A de facto 
state would emerge. I would not deny some region the right to try this program after a 
revolution, but I would not expect much from it.

In response, Carson argues that ?collectivist anarchism like syndicalism and libertarian 
communism?[would fall] under the control of a bureaucratic ruling class.? (336) For 
evidence, he refers to Ursula LeGuin?s great novel, The Dispossessed. This is a work of 
fiction (moreover about an anarchist society is conditions of scarcity), and therefore 
cannot prove anything. His other example is the historical one of the worker-run 
industries of Catalonia, in Spain during the ?thirties civil war/revolution. He cites ?a 
management-like attitude? adopted by union officials to pressure the workers to produce. 
(337) This was during a bitter civil war against the fascists. Meanwhile the 
worker-controlled enterprises still had to buy and sell on the national and international 
markets, and the liberal capitalist state still ran the war. Bureaucratic and repressive 
tendencies were not surprising! Instead Carson blames ?The Iron Law of Oligarchy.? 
Supposedly this would affect any federated system with ?federal and regional bodies 
superior to the individual factories.? (338)

It is true that any social system will be imperfect, because human beings are limited and 
imperfect. Power does corrupt?although it is also true that powerlessness corrupts. 
However, we cannot avoid the dangers of organization by not having organizations. It is no 
improvement to avoid ?federal bodies? by having self-managed factories dominated by the 
uncontrolled and undemocratic ?invisible hand of the marketplace.? (339) If we want a free 
society, we must never stop working at it. The best approach remains, ?Eternal vigilance 
is the price of liberty.? (I understand this to be the ?moral? of The Dispossessed.)
Conclusion

Under the title, ?Move Over Karl, Anarchism is Back!? Larry Gambone raves about this book, 
?A specifically anarchistic approach to economic analysis has lain dormant for the last 
130 years.? But with Carson?s book, ?this period of dormancy has finally come to an 
end?.Without too much exaggeration, Carson has produced our Das Kapital.? (sic; Gambone 
2014?; 1)

Alas, I think that this is much ?too much exaggeration.? This is a good book, a valuable 
book, which is worth reading for anyone interested in anarchist theory. Carson defends the 
labor theory of value against modern bourgeois economic theory. He rejects 
?anarcho-capitalism.? He demonstrates the role of the state, from the origins of 
capitalism to today?s crisis-ridden economy. He provides a serious discussion of possible 
anarchist strategies.

However, his economic analysis cannot be said to be superior to that of Marx. Carson 
treats the law of value as a moral imperative and wants an economy based on it. He wants a 
commodity producing market economy. Instead, libertarian communists (anarchists and 
Marxists) have the goal of ending the market, commodification, and the law of value. 
Carson?s reformist strategy is unlikely to work, and neither would his vision of a 
purified market economy. Anarchists will still have to use Marx?s critique of political 
economy, despite his statist political errors. Anarchists will still have to use the 
revolutionary tradition of ?collectivist? socialist- anarchism.


References

Carson, Kevin A. (2007). Studies in Mutualist Political Economy. Booksurge.

Cleaver, Harry (2000). Reading CAPITAL Politically. Leeds UK: AK Press/Anti-Theses.

Gambone, Larry (2014?). ?Move Over Karl, Anarchism is Back! Review of Kevin A. Carson?s 
Studies in Mutualist Political Economy.? R.A. Forum. http://raforum.infospip.php?article2463

Kropotkin, Peter (2014). Direct Struggle Against Capital; A Peter Kropotkin Anthology. 
(Iain McKay, Ed.) Oakland CA: AK Press.

Price, Wayne (Nov. 2012). ?Living through the Decline of Capitalism.? Anarkismo.
http://www.anarkismo.net/article/24227?search_text=Wayne+Price

Price, Wayne (2013). The Value of Radical Theory: An Anarchist Introduction to Marx?s 
Critique of Political Economy. Oakland CA: AK Press.

Price, Wayne (April 2014). ?Workers? Self-Directed Enterprises: A Revolutionary Program.? 
Anarkismo http://www.anarkismo.net/article/26931?search_text=Wayne+Price

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