Why Do We Have Property Rights? Why Has Capitalism Been So Successful?

Via. Chris at Stumbling and Mumbling I came across a series of interlinked posts discussing property rights and their justifications or lack thereof (which I think were sparked by Chris’ posts about copyright).

Now I won’t rehearse everything I’ve argued on this subject, but I will offer a few observations.

Ian B., a commenter at Tim Worstall’s blog, claims the following:

“Animals (indluding humans) tend towards asserting property rights. My cat believes she owns the garden, and forcibly ejects other cats from it. It’s just something animals do…You’re free to choose which sort of society you want but, like my cat, I will personally prefer the property rights one.”

What’s interesting about this is it’s actually pretty much my view – and in sharp conflict with the way that both right-libertarians and many socialists talk.

For the latter, the key issue for understanding property is work, creation of goods. There are then different arguments about whether entrepreneurs or inheritors or capitalists ‘have the right’ to their wealth, or whether in fact the workers who collectively produce that wealth ‘have the right’ to it.

But what both myself and Ian suggest is that while these reflections may be true or false, they have nothing to do with the reality of property rights. That reality is instead a descendent of the territorial instinct – that is, of animals competing for power.

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Socialism, Labour-Notes, and Black Markets: does private currency lead to private capital?

Floating around in socialist headspace there is sometimes the idea of what I’ll call here ‘labour notes’, a form of currency for a society that was socialist but not fully communist (or at least not yet – sometimes this is seen as a ‘transitional stage’ as culture adapts away from capitalist habits of thought).

The essential idea is that if it turns out that material incentives continue to be useful and necessary, then people could be ‘paid wages’ by the commue (whether local, national, whatever) for doing useful work, which they could then spend on buying certain priced goods. Not all work need by paid, and not all goods need be priced – this system could take up a high or a low percentage of the economy, and presumably that percentage would be changed over time as non-material incentives became more effective (e.g. work was re-organised to be more rewarding, or whatever).

The idea is that this isn’t money, i.e. can’t function as capital, because it can’t be used to gain ownership of means of production, i.e. can’t be invested. It just goes to the individual from the commune for work, and then goes back to the community for consumption goods – and the commune need not keep a ‘stock’ of it at all. Indeed, it might even be given a ‘negative interest rate’ so that over a certain period of time it ‘evaporates’ and ceases to be valid.

Now I’m not particularly keen to endorse or recommend such a scheme over proper communism (where goods are generally just freely available, or in some cases rationed with equal rations – i.e. ‘from each according to ability, to each according to need’). But I do think it’s useful to have as a possibility, especially for arguing with people who are convinced of human depravity.

In a recent comment, though, SnowdropExplodes says

“Honestly, I don’t know how you could stop it from circulating and becoming capital. Even if the currency itself is not transferable from one person to another then the goods for which it can be exchanged, are. From there, it is only a short step to a black market economy using a currency of its own devising, for the trade of commodities obtained using the official currency. At that point, official currency will be redeemed not for goods with use-value to the person who earned the points, but for trade-value in the black market system.

A further problem is that it clearly opens up the door to corruption if one person obtains a large amount of this official currency, and uses it to bribe others by obtaining for them goods that those others do not have the currency to buy themselves; this could in turn potentially lead to individuals obtaining control over means of production through bribery.”

This is a common question that I think is provoked by what I’ll call ‘labour-note socialism’ – is it stable? Would it morph back into capitalism? I think that it would be stable, and that black markets wouldn’t morph it into anything, so I wanted to talk a bit about why.

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Socialism, Capitalism, Risk, and Innovation

One of the themes that comes up often in debates between socialists and capitalists is the idea of ‘punishing success’.

‘When someone, a genius, a person of distinctive intelligence, comes up with a brilliant idea that makes huge savings and improves people’s lives, and in consequence becomes very rich, why do socialists want to punish them, by depriving them of their rewards? Such people are doing great services for humanity – why does socialism hate them?’

To this the simple response is that there are two personalities here: the big capitalist, who has skillfully accumulated a lot of capital, or otherwise come by it, and the innovator, someone who performs or has performed a particular productive sort of intellectual labour. Sometimes the two overlap – often they don’t. Socialists are hostile to the former, but not the latter.

Indeed, the argument is perhaps analogous to something like following, from a defender of an Classical (i.e. not racialised) form of slavery:

‘When a slave of distinctive intelligence, a genius, comes up with a brilliant idea that makes huge savings and improves people’s lives, and in consequence gains their freedom and enough money to buy themselves many slaves, why do anti-slavery advocates want to punish them, by depriving them of their rewards? Such people are doing great services for humanity – why does anti-slavery hate them?’

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What the Left Does and Doesn’t Do, and why Perhaps it should Do what it Doesn’t

Continuing some of the themes of yesterday’s post (perhaps?) it occurred to me that it’s quite common to hear socialists and sundry radicals arguing in the following styles:
1. Defensive: no, we don’t love Stalin. No, we don’t want to have everyone living in caves. No, we don’t want to give more power to Gordon Brown. No, we don’t want…
2. Critical: you see this piece of right-wing or centrist ideology here? It’s bullshit, for reasons A, B, and C, as follows…
3. Lamenting: Doesn’t it suck how many people are being blown up or are malnourished? Look how bad the existing system makes things…
4. Illuminating: see, the reason why such-and-such happens is that capitalism is constrained by the drive for profit to do X, and the political elite have to respond by doing Y…

But there’s much less of the

5. Constructive: see, if everything were run by federated workers’ councils, then large-scale economic decisions would be made by…

Now, obviously the first four are very important, but I’m still somewhat concerned about the relative lack of point 5. It’s not that there’s no discussion of it at all (I recently came across this good piece) but it tends to be occasional, and often written by socialists for socialists.

If you look at what the public tends to hear, the ‘soundbytes’ that socialists throw out, I think there’s a tendency (at least in my experience) to refrain from talking much about what ‘socialism’ is, beyond a certain collection of vague aspirations (co-operative, solidarity, rational planning, economic democracy).

Is this a bad thing? A few reasons why we might think so:

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For Revolutionary Moderation: How to Make Socialism Appealing to the Public

A recent survey by the Joseph Rowntree Foundation has sparked comment on a few blogs. It investigated what a sample of the public felt about economic inequality in British society. There are various points that will both hearten and dishearten the left, and I won’t go through all of them. The Left Luggage, as is their wont, have expressed a feeling that socialists need to adjust their message to win broad appeal. I’d like to argue that the adjustments involved are actually to some extent prefigured in Marx’s Critique of the Gotha Programme.

Some of the key findings were

1) People strongly support the idea of earned or fair inequality – that those work harder or contribute more should receive more;

2) People tended to position themselves in ‘the middle’, even when they weren’t, and to feel most sympathy for those in ‘the middle’;

3) People tended to be quite hostile to any perceived wrongdoing by the very poor – in particular, to those seen as ‘parasites’, claiming benefits while refusing to take a job – showing a similar, though lesser, hostility to the very rich when they were perceived as benefiting unfairly.

4) People supported the general idea of progressive taxation and redistribution, and a large majority supported the recent increase in the top rate of tax.

5) People were generally quite worried that inequality in Britian was much too high, and that this was related to social cohesion and crime.

6) People didn’t seem to endorse the idea of ‘equality’ as a general principle as much as they endorsed ‘fairness’.

Now what this suggests to me is that the left-wing proposal that might get the most public support would be what in the Gotha text, Marx calls ‘the early stage of communism’, and what has at other times been called ‘socialism’ as opposed to ‘communism’.

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