Tuesday, June 09, 2009

ORGANIZATION THEORY – A Libertarian Perspective.

This latest work by Kevin Carson, expands many of the themes found in his groundbreaking STUDIES IN MUTUALIST POLITICAL ECONOMY published in 2004. In ORGANIZATION THEORY Carson first examines the literature on the economics of scale and finds the giant corporation to be highly inefficient. State intervention is the factor that allows the corporation to overcome this disadvantage. He next exposes the different variety of government policies which gave rise to and aided the growth of economic centralization and giantism.

In Part Two he examines the systemic effects and in Part Three examines the internal effects of top-down organization and centralization. There are three major problems, 1. the problem of having accurate knowledge 2. the problem of economic calculation given inaccurate knowledge 3. authoritarian irrationality and internal crises. He also tears into management fads and other attempts to reform the managerial system.

Decentralist alternatives to capitalism and authoritarian management are discussed in Part Four. These involve the abolition of state-granted privilege and the dissolution of the state into society. The potential for a libertarian economy that lies within the coming Peak Oil crisis and the new technologies and systems that make capitalism obsolete are examined, as are worker cooperatives and the provision of social services without the state.

Carson comes from a Mutualist anarchist perspective. But his critique of capitalism and the alternatives he presents are useful and applicable to the entire spectrum of anarchist and libertarian socialist thought. It is a devastating examination of the arguments put forth by capitalism's “libertarian”, liberal and neo-liberal apologists. This is truly a book that no anarchist or socialist should be without.

Some highlights from ORGANIZATION THEORY:

Mass production flooded America with goods, destroying local manufacturing, and creating a problem of over-production. To sell all these products , the "push model" of marketing with advertising, packaging and branding was created. The Sloan System of management at GM adopted in the 1920's, put manufacturing second, marketing first. Thus production was subservient to a marketing plan or strategy. Hence, contrary to the apologists of corporatism, the corporate economy is a planned economy.

The plutocratic system developed originally as the new capitalist class amalgamated with the land owners. Its legal basis lies with the creation of "artificial property rights" created by government. Natural property rights involve use – working vacant land, for example. Natural property rights reflect scarcity, while artificial property rights create it. Since land had been expropriated by landlords, it is very difficult for workers to create wealth on their own. Artificial property rights in land give the proprietor property rights in the labour of others. Capitalism could not exist without artificial property rights.

The guru of neo-liberalism, Friedrich Von Hayek, claimed that central state planning cannot work well due to problems of knowledge. Carson responds, if this is a point for the market system against state planning, it is also a point for the market system against the internal hierarchy of the corporation. Ludwig Von Mises, believed that double entry book keeping solved all managerial problems. So why not a centrally planned economy, if all managerial problems are solved? asks Carson.

The highly authoritarian nature of Mise's "libertarianism", is revealed in the following quote. [Corporate managers ]... have the courage to tell the masses what no politician tells them; You are inferior and all the improvements in your conditions... you owe to the effort of men who are better than you. If hierarchy works so well, why not put the CEO's in charge of a centrally planned economy? But in the real world that exists outside of the brain farts of economists and management gurus, hierarchy is a primitive mechanism for getting people to perform tasks which they have no rational interest in performing.

Steam and water power concentrated industry for obvious reasons. Electricity sent by power lines could be used anywhere and thus allowed for decentralized and small scale production. According to Carson, 10,000 people could be self-sufficient with no factory larger than 100 employees. But the corporate structure refused to go that route. The system selects against simple technologies... in favour of complex technologies that can be safely wielded by a priesthood. Furthermore, massive state intervention might also have tipped the balance between alternative forms of productive technology.

Apologists for corporate capitalism reject small scale and worker-managed production. They claim workers have shorter time horizons than capitalists, which must be the bad joke of the century, coming from people whose time horizon is the next quarterly profit statement. Small farming is stawmanned as being like subsistence farming as it was, not how it would have been minus rents, enclosures and state support for agribusiness, not to mention innovations like intensive gardening, composting, hydroponics etc.

What hinders the development of human-scale and anti-authoritarian alternatives is not a lack of organizations, but an overabundance of them. A way to overcome capitalist hegemony in the cooperative/social economy is to create linkages between the organizations – a need to start functioning as a cohesive counter-economy. In spite of the problems of realization, it is increasingly impossible for capitalism to prevent people turning to small scale and household production. Ever more people are living unplugged and off the grid.

The present economy is fundamentally state capitalist, and as libertarians it is our objective to dismantle the state, and with it, the corporatist economy. But attacking any aspect of the state must not be our goal. Dismantle first the structures that facilitate exploitation. Evaluating the functions of the state in terms of the class purpose they serve makes it easier to understand the importance of dismantling them in the proper order. When the working population is free from exploitation, then the existing social welfare measures can be converted into forms of non-governmental mutual aid.

ORGANIZATION THEORY is available through Amazon.com



Blogger Frank Partisan said...

Overall I agree with the analysis.

I never gave it much thought, the big enterprise vs small enterprise argument. Should it matter?

12:28 AM  
Blogger Kevin Carson said...

Thanks much, Larry.

9:33 AM  
Blogger Unknown said...

Well yes, it matters how large an organization is. I think the general principle is like this: the more decentralization, the more freedom. Some of the people who wrote the US Constitution understood this and created federalism, but they failed in part by allowing the moneyed class to carry all the power.

So by having very few, and very large companies rather than many small companies, there is less choice, more hierarchy (thus unequal pay, unequal distribution of power, and tyranny), less competition, more conformity... what you end up with is a feudalistic plutocracy where the 'votes' are dollars and the average Joes don't have enough to have a say. There becomes a convergence of centralized government and centralized industry, and the two become nearly indistinguishable.

6:03 PM  
Blogger Larry Gambone said...

Size matters. Smaller workplaces – or smaller any organization for that matter, are easier to run democratically, are more personal, less alienating, and are less likely to build hierarchies (iron law of oligarchy) They are also less imposing on outsiders – think of a town with a dozen small work places vs. one giant one, and are easier on the environment. Now we might think that in a self-managed society these things wouldn't matter, but I wouldn't want to bet on it. For the first generation after liberation, we will have to be conscious of preventing back-sliding into authoritarian capitalist ways. Unnecessary large scale production will only open a path for this back-sliding. Of course there are some aspects that will require fairly large scale production, say the manufacture of steel or locomotives, but as Carson points out, much that is large scale today need not be so and is only so due to state capitalism.

9:22 PM  
Blogger Frank Partisan said...

Large scale production seems from another time. All the large manufacturing is in China.

2:45 AM  
Anonymous Anonymous said...

But it is necessary to understand organizational domination and to find ways to react properly. Network thinking has recently been presented as a potential solution : http://www.informaworld.com/smpp/content~db=all~content=a916116619

9:27 AM  
Blogger John Steinsvold said...

An Alternative to Capitalism (which we need here in the USA)

Several decades ago, Margaret Thatcher claimed: "There is no alternative". She was referring to capitalism. Today, this negative attitude still persists.

I would like to offer an alternative to capitalism for the American people to consider. Please click on the following link. It will take you to an essay titled: "Home of the Brave?" which was published by the Athenaeum Library of Philosophy:


John Steinsvold

Perhaps in time the so-called dark ages will be thought of as including our own.
--Georg C. Lichtenberg

6:33 PM  

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