A response to a Response to "Left-Anarchist" Criticisms of Anarcho-Capitalism

This is a reply to the anti-anti-"anarcho"-capitalist FAQ which used to be found at http://www.geocities.com/CapitolHill/Lobby/7895 by Chris Wilson (it no longer is and, in fact, Mr. Wilson now considers himself an anarchist and "anarcho"-capitalism an oxymoron!). It aims to "correct the misrepresentations of anarcho-capitalism (and 'right-wing' libertarianism in general) made by the anarcho-socialists [sic!] who run the Anarchist FAQ webpage, and to counter the criticisms the authors make which happen to be legitimate" which are claimed to be in old section F of our FAQ.

The author claims that "[m]uch of the anarcho-socialist FAQ is severely distortive of the position that the authors wish to refute, and the authors provide little textual evidence in support of their preconceived notions of anarcho-capitalism." This has been the first such attempt since the FAQ went on-line in early 1996. If we did produce "mostly strawmen arguments which do not truly address the actual positions that anarcho-capitalists hold" then no "anarcho"-capitalist before Wilson thought it worthwhile to let us know.

The author claims that his "FAQ aims to correct these errors, and to set the record straight for once." That is his right. However, when he first approached us with his criticism we said that we were in the process of revising that section and that we would like to hear his comments in order to correct any mistakes or strawmen we may have accidentally placed in our FAQ (after all, this section contains some of the oldest work on the FAQ and it came from our experiences of discussing with "anarcho"-capitalists on-line so mistakes could easily creep in). Instead of providing us with feedback, he decided to place his critique on-line (which again is his right). Here we reply is his criticism's of the old section F.

The new section F should also be consulted, which was being revised as Wilson created his critique of the old section F.

Section F.1 (Are "Anarcho"-Capitalists Really Anarchists?)

This section of the FAQ has been extensively revised and so much of the comments made are to text now found in other sections. The new section F.1 is far more explicit on why "anarcho"-capitalism is not part of the anarchist tradition. However, it is worthwhile to discuss the old version.

Mr Wilson starts off by noting us "that this FAQ does not begin by giving a general explanation of what anarcho-capitalism is. The authors instead decided to launch right into their rebuttal, without first informing the reader of their opposition's position." Yes, very true. We assumed that the reader would be familiar enough with the concept so that such a general explanation would not be required. In section B, for example, we discuss general capitalist attitudes towards, say, property, wage labour and so as "anarcho"-capitalism bases itself on these concepts it would be unnecessary to repeat them again.

He then quotes our FAQ:

So-called "anarcho"-capitalists only oppose the centralised state, not the hierarchical-authoritarian capitalist workplace. Thus it is absurd for them to call themselves anarchists, because the capitalist workplace is where the majority of people have their most frequent, direct, personal, and unpleasant experiences of authoritarianism.

And comments:

"More accurately, anarcho-capitalists oppose the governing of a person's behaviour by other persons without that first person's prior consent. A-C'ers do not support the centralised state because it holds a geographical monopoly upon the use of force, which infringes upon the individual sovereignty of those living within that area. Regardless of whether the state is a representative democracy or a dictatorship, it necessarily violates the conditions that make consent a possibility. Specifically, the state thrives on a policy of coercion, which consists of initiating interference with the actions and will of individuals and benefiting at their expense."

So, in other words, "consent" is required and that makes authoritarianism okay. Thus capitalist hierarchy is fine because workers agree to it but state hierarchy is bad because citizens do not "consent". But as we argue in the new section F.2.3 (Can "anarcho"-capitalist theory justify the state?) in a liberal or democratic state citizens are free to move to another state. They can withdraw their "consent" just as a worker can withdraw their "consent" and look for another job. If consent is the key aspect of whether something is evil or not then the modern state is not an evil as it is based upon consent. No one forces you to stay in a given state. Thus "consent" is not enough in itself to justify hierarchy.

In addition, we should not that the boss also interferes with the actions and will of individuals and benefits at their expense. Indeed, Murray Rothbard actually states that if the state legitimately owned the land it claims then it would be perfectly justified in "interfering" with those lived on its property in exactly the same way that any other property does! (see section F.2.3). His opposition to the state is simply that the property it claims was unjustly acquired, not that it restricts individual freedom.

Thus, for "anarcho"-capitalists, the difference between restrictions on freedom created by property and those created by statism is that the former are caused by a "just" history (and so are fine) while the later are caused by an "unjust" history (and so are bad). However, given that the property regime we live in is deeply affected by past state actions (see section F.8), this criteria is phoney as capitalism shares a history of violence with the state. If state hierarchy is wrong, so is capitalist hierarchy -- if "history" is actually to account for anything rather than just as rhetoric to justify capitalist oppression.

Wilson goes on to state that "anarcho"-capitalists "do not wish to abolish the 'hierarchical-authoritarian capitalist workplace', because of the fact that doing so would place a restriction upon the number of alternatives people can choose to improve their situations without violating the liberty of others."

Sounds lovely and freedom enhancing does it not? Until you think about it more deeply. Then you realise that such glorification of choice is just a "dismal politics", where most of the choices are bad. After all, in "actually existing" capitalism the percentage of non-wage slaves in the workforce is around 10% (and this figure includes bosses and not just self-employed workers). The percentage of self-employed has steadily decreased from the dawn of capitalism which means that capitalism itself restricts the number of alternatives people have to choose from!

And let us see what the "hierarchical-authoritarian capitalist workplace" involves. It is based upon the worker selling their liberty to gain entry to it. Why do they do that? Because the circumstances they face means that they have little choice but to do so. And these circumstances are created by the rights framework within society; in other words capitalist property rights. Wilson assumes that abolishing capitalist property rights will involve "violating the liberty of others" but it is clear that that maintaining these rights results in people "voluntarily" selling their liberty due to the circumstances created by these property rights. In other words, the enforcement of property rights involves the violation of liberty of those subject to the rules and regulations of the property owner. For example, the boss can ban numerous free actions, agreements and exchanges on his property -- the joining of a union, free speech, freedom to wear what you like and so on.

Wilson goes on to argue that "a person enters into a bilateral exchange with another person out of an expectation that the benefits of the exchange will exceed its costs. . . . He [the capitalist] underwent the expense involved in purchasing and/or producing these capital goods, and if he does not consent to give them up to the workers, any forceful appropriation of them on behalf of the workers would be a violation of his autonomy."

So, just to be clear, if the worker has the option of selling her labour and starving to death then the worker "freely" sells her liberty. Any attempt to change the rights framework of society is a "violation" of the capitalist's "autonomy". The same could be said of the state. After all, the state has went to the expense of acquiring and protecting the land it claims. But, of course, this initial claim was invalid and so the state is to be opposed. But the capitalist class has profited from the state's use of force many a time and the economic circumstances it has helped create. After all, it was state enforcement of the "land monopoly" that created a pool of landless workers who had no choice but to enter into wage slavery. The capitalists enriched themselves at the expense of desperate people with no other options, with state aid to repress strikes and unions.

If the state's claims of ownership are phoney, then so are the claims of capitalists.

Wilson then laments that:

"A worker who does not possess the same amount of wealth as an entrepreneur will often consent to what anarcho-socialists would call an 'unequal exchange' because of the fact that he forecasts that an improvement in his situation will result from it. To prevent this type of exchange from occurring would be to constrain the number of options available that one can choose to improve one's lot."

As noted above, it is capitalism that constrains the number of options available to "improve one's lot". But Wilson seems to be assuming that anarchists desire to somehow "ban" wage labour. But we made no such claim. We argued that we need to change the rights framework of society and take back that which has been stolen from us. After all, capitalists have used the state to enrich themselves at our expense for hundreds of years (indeed, as we argue in section F.8 the state played a key role in the development of capitalism in the first place).

As Nozick argues in Anarchy, State, and Utopia, only "justly" acquired property can be legitimately transferred. But under capitalism, property was not justly acquired (indeed, even Nozick's conceptual theory of land acquisition does not justify land ownership -- see section B.3.4). Thus we are not violating the liberty of capitalists if we take their property and modify the rights framework because it was not their property to begin with!

Wilson goes on to argue that "[d]espite the unpleasant rules that a worker may have to follow when on the job, the worker does it for the purpose of securing something greater in the end."

The same logic has been used to justify the state. Despite the unpleasant rules that a citizen may have to follow, they do it for the purpose of securing something greater in the end -- security, liberty, whatever. That is hardly a convincing argument and seems more to do with justifying and rationalising unfreedom than anything else.

So what is the "something greater"? Usually to have enough money to buy food, shelter and so on. Most workers are a pay packet away from poverty. As the "something greater" is to be able to live, that suggests that workers do not "consent" freely to become a wage slave. They have little choice.

Wilson goes on:

"This is why anarcho-capitalists do not wish to abolish consensual hierarchy or a mutual acceptance of rules (which is what the anarcho-socialists call 'authoritarian' in this case). If people consent to such relationships, it's for the purpose of acquiring a higher degree of freedom that will exceed the degree of sacrifice that the transaction involves. They value the projected outcomes of the exchanges they make more than they value the result of not making the exchange at all."

And what is the result of not making the exchange? Poverty, starvation. Wow, some "choice". But anarchists do not wish to abolish consensual hierarchy. We wish to give people a real choice. This real choice is impossible under capitalism and so the vast majority sell their liberty. That Wilson ignores the circumstances that force people to wage labour says a lot.

Now, anarchists have no problem with the "mutual acceptance of rules". This does not need to be "authoritarian" (no matter what Wilson claims we think). For example, in a co-operative the members create their own rules by mutual agreement and debate. That is not authoritarian. What is authoritarian is when one person says "I make the rules round here and you can love it or leave it". That is what the state does and it is what the capitalist does. It is authoritarian because the rules are imposed on the rest -- who then have the choice of following these rules or leaving. Thus the capitalist workplace is a dictatorship and so authoritarian.

Moving on, Wilson disagrees with anarchist claims that capitalism is based upon exploitation and oppression. He states that "[w]hat this FAQ does not mention (in this particular section) is that exploitation doctrine is based upon an economic theory of value, which is, shall we say, less than universally accepted by political theorists and economists today. This is the labour theory of value (LTV). . . "

Yes, it is true that most economists and political theorists do not accept the Labour Theory of Value. Most do not understand it and present strawmen arguments against it. But small but significant groupings of economists and political theorists do accept it (for example, individualist anarchists, Marxists, many social anarchists, many post-keynesianists). But the question arises, why is the LTV rejected? Simply because it argues that capitalism is based upon exploitation and that non-labour income is usury. Unsurprisingly, when it comes to supporting economic theories, the wealthy will pick those which justify their incomes and riches, not those which argue that they are illegitimate. Thus the LTV along with Henry George's ideas would not be selected within the "free marketplace of ideas" -- indeed the followers of George argue that neo-classical economics was deliberately funded by the wealthy to marginalise their ideas.

So, to state that the LTV is a "less than universally accepted" is like arguing that because democratic theory was "less than universally accepted" in Nazi Germany there must be something wrong with it. Wilson falls into the common fallacy that economic ideas are value free and do not reflect class interests.

He goes on to state "anarcho"-capitalists do not "accept that theory" (which comes as no surprise as they do not like to think about what goes on at the point of production that much) and even if we do accept the LTV that it is "still not obvious that the 'profits = exploitation' conclusion follows from it. In his book Hidden Order, David Friedman makes an interesting point that 'the laws of physics tell us that the sum total of energy can neither be increased, nor reduced. What we call 'production' is the rearrangement of matter and energy from less useful to more useful (to us) forms.' [David Friedman, Hidden Order, p 128] Production managers, just like manual labourers, do precisely this. They produce by rearranging matter through time and space, but rather than rearranging constituent parts to produce a good, they rearrange the goods themselves into the hands of customers (which manual labourers do not do)."

Funnily enough, the FAQ does not deny the importance of management and administration skills. No anarchist has ever maintained that workplaces do not need to be managed. Nor did we argue that "manual labour" was the only form of labour that added value. Quite the reverse in fact. What we did argue was that in a dictatorship those at the top will consider that their contribution added most value to a product and reward themselves appropriately. We argued that the higher up the management structure you go, the less value the labour adds to output. Indeed, the basic function of management is to organise labour in such a way as to maximise profits. That is why the hierarchical workplace exists. In the words of one economist:

"Managers of a capitalist enterprise are not content simply to respond to the dictates of the market by equating the wage to the value of the marginal product of labour. Once the worker has entered the production process, the forces of the market have, for a time at least, been superseded. The effort-pay relation will depend not only on market relations of exchange but also. . . on the hierarchical relations of production - on the relative power of managers and workers within the enterprise." [William Lazonick, Business Organisation and the Myth of the Market Economy, pp. 184-5]

Thus profits are maximised by maximising the labour workers do while minimising the amount paid to them. That is what the management structure exists for. That Wilson denies this suggests that he views the firm as some kind of "black-box" within which human social relationships and action are irrelevant. But this is not the case -- what does on in production is the key to profitability. As the early socialist Thomas Hodgskin put it:

"Fixed capital does not derive its utility from previous, but present labour; and does not bring its owner a profit because it has been stored up, but because it is a means of obtaining a command over labour."

And nothing has changed. As Proudhon long ago argued, only labour is productive. Without labour capital would rust away. Thus the LTV is far more applicable that Wilson would like us to believe.

Now, Wilson claims that "manual labourers" do not "rearrange the goods themselves into the hands of customers" but in a co-operative the workforce does just that. They elect managers and take part in the management structure. Wilson fails to notice that workers do not do that in capitalist firms because the management structure is top-down and is designed to disempower workers. So if workers do not do these tasks it is because management has the monopoly of (official) power and decides that it adds most value and deserves a higher reward. So, in other words, capitalist property rights create dictatorship and those in the dictatorship enrich themselves. Not a surprising outcome.

Wilson then argues that "anarcho"-capitalists "reject the labour theory of value in favour of marginal utility theory, which holds that prices are determined by the subjective preferences and plans of individuals."

Of course, the LTV also argues that prices are determined by the subjective preferences of individuals. In order to have exchange value, a commodity must have a use value to a customer. And, of course, exchange value does not equal price but is instead an abstraction of the fact that when a commodity is produced a specific set of costs have been spent on it. These costs are objective facts and determine whether a commodity makes a profit or not. In the long term, commodities would exchange at a price equivalent to the abstract exchange value but in the short term they vary according to supply and demand. As we argue in section C, the marginal utility theory ignores the fact that a commodity has an objective cost associated with it which is its exchange value. When it boils down to it, the profit which a product generates is what capitalists "subjectively value" and these profits are dependent on the productivity of labour (i.e. the more workers make in a given period for the same wage, the higher potential profits will be).

Wilson goes on to state that "[i]t's obvious that the author has little respect for the reasoned arguments published by free-market economists and political theorists in the last century. It's pretty insulting when somebody responds to a reasoned argument by scoffing at it and referring to it as 'apologetics' or 'rationalisation', rather than giving it serious consideration." But, strangely enough, we discussed why we think the LTV is a better way of analysing capitalism that than those provided by "free-market economists and political theorists" and in our humble opinion, it is apologetics and rationalisations. Sorry if Mr Wilson does not agree, but then again he would not. For example, most of "anarcho"-capitalism seems to involve apologetics and rationalisations for the restrictions of individual liberty associated with capitalism. See, for example, section F.2.1 in which Murray Rothbard rationalises away capitalist oppression even when it clearly has similarities with statist oppression. Similarly, many Stalinists and supporters of Nazism provided many "reasoned arguments" to indicate why the fact of dictatorship was essential. Just because currently capitalist ideology is widely accepted does not make it any less apologetics than these "reasoned arguments." Again, Wilson assumes that economic theory is value free rather than being the "economics of the rich" to use Edward Herman's cutting phrase.

Wilson then states that "[t]his paragraph is both a form of argument from intimidation and argument ad hominem, and hence we shall let it pass without further comment." Well, having discussed in section C why we think that capitalism is exploitative we did not think we really had to repeat ourselves. And as far as arguments from intimidation and arguments ad hominem go, Wilson indulges himself in this later with his "parasite", "dictator" and other comments.

He then quotes the FAQ:

"Anarcho"-capitalists, however, believe that capitalist companies will necessarily remain hierarchical even if the public state has been dissolved. This is because only hierarchical workplaces are "efficient" enough to survive in a 'free' market. This belief reveals the priority of their values: "efficiency" (the bottom line) is considered more important than eliminating the domination, coercion, and exploitation of workers. In addition, such hierarchies will need "defending" from those oppressed by them; and hence, due to its support of private property (and thus authority), "anarcho"-capitalism ends up retaining a state in its "anarchy," namely a private state whose existence its proponents attempt to deny simply by refusing to call it a state, like an ostrich hiding its head in the sand (see section F.6 for more on this and why "anarcho"-capitalism is better described as "private state" capitalism).

Now, lets see about these claims. Now, the reason why anarchists think that capitalist production involves "domination, coercion, and exploitation" of workers was discussed at great length in sections B and C of the FAQ. Indeed, it is mentioned in passing in section A on why anarchists are socialists and why anarchists support direct democracy. Apparently we should have repeated all our arguments again in order to meet Wilson's inability to look at the rest of the FAQ. Of course, perhaps, we should have placed links to the appropriate sections but given that we doubted that anyone would jump straight into section F.1 we did not. Now as far as a "fair explanation" as to why "anarcho"-capitalists disagree with real anarchists on these issues we indicate why capitalistic property is wrong (and we argued in section B.3 and B.1 why private property is "authoritarian" -- something, we should note, that "anarcho"-capitalists do not actually disagree with. They just argue that "consent" ensures that the authoritarian relationships it creates are not a restriction of liberty). Now, the aim of section F of the FAQ was to explain why "anarcho"-capitalism was not a form of anarchism. And this is what we did. Hence Wilson's comments are misplaces, to say the least.

Wilson then does on to argue that capitalist production "does involve hierarchy, considering that the owners of the means of production must direct the disposal of their resources so that they don't go to waste." So, as noted, he agrees that capitalist private property is authoritarian (how could hierarchy be anything else?). Thus his laments that we just "assert" this fact is somewhat strange. He then tries to get out of this by noting that:

"the same situation will accrue under worker ownership. All production strategies and guidelines would be established by a system of majority vote, and so it's doubtful that any single individual will have a much greater influence in determining them than one would under a under an hierarchical capitalist corporation."

Really? But a key aspect of anarchist ideas of self-management is that capitalist corporations must be broken up and replaced by a confederation of self-managed workplaces. The workers in a given workplace would have extensive control over what affects them directly and the possibility of influencing the decisions of the wider issues that affect their industry. So it is nonsense to say that individuals will not have a greater influence than in a hierarchical capitalist firm. Unlike in a capitalist firm they are not just order takers (and lets not forget that this is what the worker is under capitalism). They can and do have control over many important aspects of their work. This can be seen when limited workers control is introduced into capitalist firms, so Wilson's claims are just an attempt to justify factory fascism.

Talking of which, he celebrates this when he argues that:

"The only difference that might possibly accrue as a result of worker ownership would be a higher degree of gridlock involved in determining company policy. With respect to a political institution, gridlock is good; it prevents any single individual from having too much power and from subsequently passing a great deal of tyrannical statute law. With respect to a business, gridlock is bad, because it prevents business from adapting to constantly changing market conditions."

How strange. Identical social relationships switch from being bad to good purely on whether it is a capitalist that has power or a state official. Such is the power of "consent"!

Wilson then moves onto bigger and better claims:

"Some 'anarchists' claim that there will not be any competition between worker-owned firms under their version of 'anarchy', because all individual firms will be subordinated to the direction of a larger system of worker management. Of course, what this 'larger system of worker management' amounts to is an institution that falls neatly under the Weberian definition of a state. That isn't to say, of course, that the 'anarchists' who advocate this social arrangement aren't opposed to statism. On the contrary, they're vehemently opposed to the state provided that they and their comrades aren't in charge of it."

Yes, anarchists who favour workplace self-management really want to be "in charge" of a new state! What wonderful logic! Using this logic it would be simple to prove that Hitler was an anarchist (he argued for dictatorship but obviously he favoured anarchy just as the anarchists who argue for self-management desire dictatorship). Moreover, Wilson totally misrepresents anarchist ideas of workplace confederation. The "larger system of worker management" is based upon freely joining a confederation and the individual workplaces within it have as much autonomy as they agree they need. To claim that this is statist is just plain silly -- it is clearly an agreement between groups to work together.

Now, let us look at the capitalist workplace or corporation. Within these the boss bans all competition within his/her property he/she does not desire. So if the anarchist system of confederation meets the Weberian definition of a state so does the capitalist firm! Indeed, as we argue in section F.6.4, the property owner can "ban" workers from, say, joining a union or subscribing to specific "defence" firms. In other words, the "anarcho"-capitalist are vehemently opposed to the state provided that the capitalists are not in charge of it.

So Wilson highlights the central fallacy of "anarcho"-capitalism, namely that private property some how does not meet the Weberian definition of the state. But, in fact, it clearly does. Something, a may note that Murray Rothbard (in his own way) recognised but did not consider important enough to draw the obvious conclusions from. Which presents us with the question: Is voluntary democracy more libertarian than voluntary dictatorship? Anarchists think that self-management has far more to do with liberty that hierarchy and so oppose capitalism. "Anarcho"-capitalists seem to think that dictatorship has no effect on liberty. Which is somewhat strange, to say the least.

Wilson then goes on to state that "worker ownership and even communal ownership of the means of production would be perfectly legitimate under anarcho-capitalism, provided that nobody violates anybody else's consent."

Which is ironic, as capitalism was created by violating the rights of working people to worker ownership/control and communal ownership (see section F.8). How that the capitalists have the upper hand, they can embrace "free competition" knowing that their advantage on the market will ensure that workers control will not spread (see sections J.5.10, J.5.11 and J.5.12). Kind of like the thief who argues that you can take back what was stolen from you as long as you do not violate his consent (which he is not going to give)!

So Wilson is simply acknowledging that under capitalism you have to buy the freedom which should be your birth right from those who have stolen it! How generous.

Wilson then goes to agree with the FAQ by stating that management "does set the terms of the use and disposal of company property (whoever the owners happen to be)" and so workers are subject to authoritarian social relationships and so are not free. But, he argues, "according to what standard would the workers have a right to forcibly seize the means of production out of dissatisfaction with the situation?" There are many answers to this (answers which Mr Wilson does not present which means, to paraphrase his good self, "nor does he bother to give a fair explanation as to why anarchists disagree with them on this issue").

If we take a Stirnerite point of view, we could argue that workers need no "right" to take them over. They desire them and desire freedom. That is good enough in itself. As the capitalists have no "right" to restrict the liberty of workers, workers have no "right" to stop that restriction. They do it anyway. Or we could take a Proudhonist viewpoint which argues that the land cannot be appropriated and so capitalists have no right to their capital as the initial appropriations were illegitimate and they have enriched themselves by the labour of others who have been placed in evil circumstances by capitalist property rights. Or we could argue along Bakuninist lines that freedom is what we value most and so society should be re-organised so that unnecessary domination is eliminated, particularly the domination that flows from unpaid labour.

Of course Wilson assumes that capitalist "rights" to their property are beyond question. Let us turn the question on its head. By what right do capitalists have of oppressing workers and barring people from their property? If we take Rothbard's "Homesteading" conceptual theory (see section F.4.1) then it boils down to "finders keepers" and so humanity will always be enchained by the first people to appropriate land. So living people will see their liberty restricted because of past history.

Wilson does present one "right", namely:

"Because they use it while working on it? By this criterion, it's acceptable for one to seize anything that one is capable of using, without regard to those who already hold it in their possession. I would imagine that any anarcho-socialist who prefers an arrangement in which there is some form of peaceful social order would hold that certain predatory forms of behaviour are not acceptable, but to grant use-rights to anybody who is capable of using something is to encourage such forms of behaviour. If there are to be rights of usage at all, people must forgo the power involved in appropriating resources that are already in use by other people. If people do not forgo that particular freedom, then nobody will be able to secure access to the resources that they use, or to be able to exercise their freedom in relation to it. The physical objects and resources that one utilises for one's purposes would always be up for claim by the next person who comes along (and may the strongest man win!)."

Wilson argues that granting "use-rights" will encourage Hobbesian behaviour, which suggests that he thinks that people cannot live together peacefully without police forces and laws (well, then again, he is an "anarcho"-capitalist). It seems strange to think that an anarchist society would develop in which people would have so little respect for others. Given that the whole point of the expropriation of the capitalists was to maximise individual freedom and dignity, it is doubtful that people would start to violate those values. But Wilson is assuming that without police forces humanity would turn into a Hobbesian war of all against all but this has never been the case of communities based upon use rights (see Kropotkin's Mutual Aid for extensive evidence).

Wilson, after misrepresenting anarchist ideas, now moves on to justifying capitalist domination:

"Abiding by the rules and codes enforced on the job may be irritating at times, but an exchange is a relationship that one enters into voluntarily."

By stressing "consent" and ignoring the relationships generated by the contract, "anarcho"-capitalism ends up justifying state-like structures. If the current system of states was replaced by, say, 500 large companies, would that make the rules and codes any different from state laws? Of course not.

Wilson argues that "if one does not think that the value offered by the other party is sufficient to cover the cost of the transaction, then one should not make the exchange in the first place."

How true. The woman who agrees to sleep with her boss to keep her job, the drowning man who agrees to pay a passing boatman $5 million to be saved, the landless peasant who agrees to work in a sweatshop for 14 hours a day all "freely" make an exchange. After all, if they do not what they face is even worse than the options of the "exchange". Who can deny that they all think that the "value" offered by the other party makes it worthwhile to enter into the exchange? And who but an "anarcho"-capitalist will deny that these exchanges are evil ones which violate the liberty and dignity of the party in unfortunate circumstances?

To concentrate on "exchange" is simply to blind oneself to relations of domination and oppression.

Wilson then goes on to wax-lyrical on the "mentality" of the strawman he has created above:

"The opinion that one has the right to appropriate from others at whim without their consent whenever one is dissatisfied with one's situation is the doctrine of a thief or a dictator. He who accepts this doctrine possesses the mentality of a parasite and a free-rider, not the mentality of a person who is willing to respect the sovereignty of other people (i.e., a person fit to live in a civilised society)."

Actually, it is Wilson who expresses the mentality of a dictator when he attacks use-rights. You can just imagine a feudal lord or aristocrat arguing that just because someone lives on their land, it does not give them any right to determine the laws they are subject to. That rests with the owner, namely the lord or state. Indeed, we have shades of Locke in Wilson's argument. Locke argued that only the wealthy should pass laws within civil society. The poor, while being subject to them, do not have a say in them. They are included within, but not part of, civil society. Wilson's diatribe against use rights exposes the elitist roots of "anarcho"-capitalism and that this regime will universal monarchy and dictatorship in the name of "liberty" (after all, it will be the property owner who determines the laws and rules which those who just happen to work or life there are subject to).

Now, as far as people able to "live in a civilised society" goes it is pretty clear that a rights system that can result in famine, hierarchy and extreme poverty is hardly "civilised". Indeed, until the rise of capitalism the idea that people had a right to life was a common one. All that changed and now we face the option "work or starve". How very civilised. And, of course, how "civilised" is a system which ensures that the majority has to sell their liberty to others? If civilisation is the progress of individual liberty, then capitalism is not a form of civilisation.

Wilson then quotes the FAQ:

And, of course, inequalities of power and wealth do not restrict themselves to workplaces nor is the damage of hierarchy upon individuals and their liberty limited to working hours. Both have a deep impact on the rest of society, expanding into all areas of life and restricting liberty everywhere.

and asks:

"Evidence? If people enter into relationships that they perceive as leading to improvements over their initial situation, it's difficult to see how liberty can be restricted as a result. One can make errors of judgement when making these decisions, but one of the conditions of living in a free society is that one possess the freedom to make mistakes (even disastrous ones!) and to learn from them."

Let as see, workers enter into relationships they perceive as leading to improvements over their initial situation (their initial situation is that they will starve to death unless they get money; unsurprisingly they enter into the wage slave relationship). As a result of this relationship, profits accumulate in the hands of the few. This increases inequality within society and, after all, money is power. Thus "bilateral exchanges" can result in restrictions of liberty for those involved and externalities in terms of inequality which affect other people (see sections F.2 and F.3). Increasing inequality means that the few have increased clout and so can hang out longer then the less well off. This means that the less well off compromise faster and deeper than they would otherwise do. These compromises increase inequalities and so the process continues, with the few increasing their power within society and the amount of land/resources they own.

Yes, indeed, people can make errors of judgement and the freedom to make mistakes is essential, but neither of these facts means that we should support capitalism. If making decisions is the thing we value then supporting a system which actively restricts decision making (for example, in work) is somewhat strange. Similarly, to support a system which promotes inequalities which end up restricting out options to (effectively) choosing which boss will govern us hardly promotes choice. So, in a free society, we must take responsibility for our decisions but capitalism so restricts these decisions as to make a mockery of freedom. That is why anarchists oppose it.

Wilson then says that it is "interesting to note that the first person the FAQ quotes in its section on anarcho-capitalism is an anarcho-socialist who understands the position being critiqued about as well as the authors of the FAQ." Actually, Chomsky gets to the root of the problem with "anarcho"-capitalism, it is just "anarchism for the rich" and would soon result in extensive restrictions of liberty for the majority. It is clear that Wilson does not understand this basic point and so ignores it.

He then states:

"So much for providing textual evidence in support of the position being critiqued. But then again, fair representation of the opposition is obviously not one of the intentions behind the FAQ."

Wilson quotes the FAQ:

It is clear, then, that "anarcho"-capitalists are not really anti-authoritarians, because they would allow authoritarianism to persist where it has the most direct impact on ordinary people: in the workplace.

and comments:

"It's not clear from the FAQ at all, considering that it doesn't once site a work written by an anarcho-capitalist in this section, nor does it give a considerate explication of anarcho-capitalist viewpoints."

In other words, Wilson "critique" is bogus as he fails to place the section he is critiquing in context.

Wilson then states that:

"It's much more clear that it would be authoritarian to prevent 'capitalist acts among consenting adults' (Nozick's term), because people enter in these relations to improve their lot."

Moreover, within the capitalist workplace the capitalist can and does prevent socialist acts among consenting adults (for example, the forming of a union, self-managed work, and so forth). So it is much more clear that capitalism is authoritarian simply because it creates relations of domination between the property owning class and the working class. Wilson fails to understand this because he makes an idol of "consent", an idol which can and has been used to define the state (after all, no one forces you to live in a given state).

Thus Wilson's defence of "freedom" indicates a definition of freedom which is little more than the justification of relationships of domination and authority (see section F.2 for more on this).

He quotes the FAQ again:

But anarchism is, by definition, anti-authoritarian (see sections A.1 and A.2.8). Thus "anarcho"-capitalists have illegitimately appropriated the prefix "anarcho" to describe themselves. In reality they are bogus anarchists.

and states, "[i]n reality, the authors of the anarcho-socialist FAQ are offering no more than a bogus critique." Which is funny, as Wilson has agreed with our analysis. Yes, he acknowledges, capitalist workplaces are hierarchical. Yes, "anarcho"-capitalists have no problem with them because they are "voluntary". Of course, he fails to note the objective conditions facing those who "consent" and makes no attempt to discover whether "anarcho"-capitalism would reinforce these pressures or not (just as he fails to note we addressed this issue of "consent" in section B.4 of the FAQ).

So is this a "bogus critique"? No, far from it. While we have totally revised this section of the FAQ in order to make the differences between anarchism and "anarcho"-capitalism clearer, it cannot be said that it is "bogus". After all, Wilson has agreed with our analysis. He just thinks that "consent" makes unfreedom okay. But for anarchists the circumstances which we face are essential for determining whether something is truly consented to. As Wilson takes capitalism and capitalist property rights as given and unchangeable, his objections are question begging in the extreme.

Thus, far from being a "bogus critique" Wilson indicates well why "anarcho"-capitalists are not anarchists. Indeed, their theory is little more than an attempt to justify capitalist domination and cloak it with the title "liberty". As Wilson himself shows.

A Critique of Section F.1.2 (How libertarian is right-Libertarian theory?)

Wilson starts off by insults:

"Unfortunately, the authors aren't in any position to assess whether or not libertarianism is based upon critical thought, considering that they themselves haven't exercised the critical thought necessary to understand the position they're attempting to critique."

Which, of course, is acknowledging that right-libertarianism is built upon assumptions! It is just that these assumptions are considered "sound" by "anarcho"-capitalists.

He then states that:

"As far as 'change and the ability to evolve' go, 'right' [sic!] libertarians do not have any problems with it in itself. There are many forms of changes that most anarcho-capitalists avidly support (such as technological development), but they do not advocate change for its own sake, nor do they advocate just any form of change. Change is not desirable if it somehow compromises the individual integrity and autonomy of individuals; that cannot be stressed enough."

He quotes the FAQ as follows:

Right-Libertarianism is characterised by a strong tendency of creating theories based upon a priori theorems. Robert Nozick in Anarchy, State and Utopia makes no attempt to provide a justification of the property rights his whole theory is based upon. Indeed he states that "we shall not formulate [it] here." [Anarchy, State and Utopia, p. 150] Moreover, it is not formulated anywhere else by Nozick either. And if it is not formulated, what is there to defend? His whole theory is based upon assumptions.

And argues that "[i]t's true that Nozick builds his argument upon certain starting 'assumptions' that go undefended within the course of the book. What the authors do not say is that Nozick's main 'assumption' is that '[i]ndividuals have rights, and [that] there are certain things no person or group may do to them (without violating their rights).' [Anarchy, State, and Utopia, p. ix] This 'assumption' isn't one that turns out to be all that implausible."

Quite. And the question now becomes, what rights do we assume that they have? Do people have a right to be free? Not according to Nozick, as his self-ownership thesis ensures that people will be subject to authoritarian social relationships if they "consent" to them. Similarly, many people think that individuals should have a right to life but that is not one that Nozick accepts. From his perspective, if you are starving to death then it would be a worse evil to tax a millionaire $1 than to tax the millionarie and use that $1 to feed you (see section F.4 for example, or the new section F.1.2).

Now, the assumption is "plausible" but that was not the assumption we focused upon. Nozick assumes his property rights system, the whole basis of his theory. Thus his theory of transfer is based upon his theory of appropriation of property, a theory which he clearly states he will not provide us with! Somewhat strange that the crux of his whole theory is just not provided. After all, if his argument for appropriating land is proven false then his whole entitlement theory also falls (indeed, as we argue in section B.3.4, such a defence can be put together from Nozick's work and it does not provide such support). So to just assume its truth is amazing. That Wilson fails to even acknowledge the importance of this omission is not surprising, after all it would mean that our argument was correct -- Nozick assumed the key aspect of his theory and that his whole book is built upon an unproven assumption. Little wonder he does off on a tangent and does not address the point we make.

Wilson then continues with Nozick's "rights" assumption by stating that "[t]hough this is a moral intuition that Nozick doesn't defend in ASU, it is a sufficiently broad-based intuition to be held securely by a rational person. Is the intuition that people have rights one that the authors of the FAQ would deny? If they don't accept the premise that there ought to be certain obligatory side-constraints upon human behaviour for the purpose of preserving the autonomy of people (i.e., rights), that would seem to suggest that they have a rather weak commitment to the ideal of human freedom."

Quite what to make of this is difficult to tell. After all, what (say) Marx, Hitler, J.S. Mill, Bakunin, Stirner and so on would consider as "intuitive" rights and what Nozick would consider as such is open to much debate. A rational person would, perhaps, consider the consequences of these rights and determine whether they actually did ensure a strong commitment of the ideal of human freedom. If, for example, Nozick's rights resulted in a society of large scale (voluntary) slavery due to minority control of resources then that society would hardly be based on a commitment to human freedom.

Thus a rational person rather than following a train of logic which resulted in massive violations of human liberty would decide to change the rights framework they supported. Such a process could be seen at work in J.S. Mill who realised that under capitalism workers could be in a situation little than slavery. Thus an abstract commitment to liberty may result in circumstances that violated the liberty of the many. Thus to claim that anarchists have a "rather weak commitment to the ideal of human freedom" is nonsense. It is rather the right libertarian whose definition of freedom is such so weak as to make a mockery of freedom in practice.

And notice that Wilson has still not addressed the issue of the assumption of capitalist property rights and instead decided to imply that anarchists are into violating the rights of others (these rights, of course, being undefined).

Wilson then goes on:

"Perhaps they reject Nozick's starting moral premise because it hasn't been rationally validated. The truth is: Neither has any basic moral premise. Hume's dictum that it is impossible to derive a normative statement from a set of descriptive statements (assuming that they're free of normative content) still holds, and I challenge the anarcho-socialists to demonstrate that their most basic normative premises can validated in a way that doesn't rely upon intuition."

Wilson continues:

"It should also be mentioned that although Nozick assumes premises as basic as the one that people have rights, he does not simply assume the form they must take or their form of application. On the contrary, he argues for his libertarian conception of rights via a critical analysis of other political conceptions of justice as well as his own, and he does so rigorously and brilliantly."

Wilson again:

"Notice that the authors of the FAQ offer no criticisms of Nozick's actual arguments, but simply dismiss him as quickly as possible. They quote isolated sections of text for their own purposes of "refutation", and completely fail to engage the sections of ASU that really matter. Many political philosophers have expressed serious disagreement with Nozick over the past few decades, but unlike the authors of the anarcho-socialist FAQ, they have critically engaged Nozick's views because they recognised that if they were to advocate a non-libertarian political theory, Nozick's objections would have to be answered."

After presenting a list of other right-libertarian theorists (although see Will Kymlicka's Contemporary Political Philosophy for an excellently critique of many of these theories along with Nozick) he then states that "we will eventually arrive at section F.7, which does an excellent job demolishing a fictitious strawman of the admittedly elusive concept of 'natural law'. This FAQ will demonstrate why the anarcho-socialist FAQ doesn't actually refute a moral theory that many libertarians buy into" although section F.7 does not refute a strawman unless it is a strawman created by supporters of "Natural Law" themselves.

Wilson then disagrees with Murray Bookchin's arguments against "the law of identity" arguing that identity "doesn't merely account for an entity's current state of being. The concept of 'identity' easily accounts for existential change by subsuming the attribute of potentiality. This criticism attacks Aristotle's first law of logic while ignoring his conception of the material cause."

This is strange. If we assume "potentiality" then we are arguing that "A can potentially be A", not that "A is A". Water can "potentially" be both steam and ice, does that mean "water is steam" or "water is ice"? If you argue that "A is A" and then modify it to acknowledge that "A can perhaps be A sometime in the future" is somewhat strange. Either the law of identity states that "A is A" or it does not. Adding on "potentiality" just indicates how limited the law of identity actually is.

He then quotes the FAQ:

In other words, right-Libertarian theory is based upon ignoring the fundamental aspect of life - namely change and evolution.

And argues that the authors "have in no way demonstrated this. They're simply pulling arguments out of a hat with out heed to whether or not they actually apply to the position they're trying to critique."

Now, we argued that must of right-libertarian theory was built upon assumptions. Indeed, Wilson agrees with us. We argued that by using assumptions and deducing things from these assumptions means that you fail to take into account change (this can be clearly seen from Rothbard's claims on "Natural law" quoted in section F.7). Thus, using "natural rights" as Nozick, Rand and Rothbard do is to use the law of identity and this, as Bookchin noted, fails to take into account change. Thus we are not "pulling arguments out of a hat" but trying to draw out the implications of the methodology used. Now, Wilson is free to consider that these points do not apply to the positions in question, but obviously we do not agree with him. If you start with certain assumptions about "Man" and then deduce conclusions from these assumptions then you fail to see now these assumptions can change in use. For example, the assumption of self-ownership is all fine and well but in practice it can become the means of denying liberty, not protecting it (see section B.4 and F.2). Also, to assume "Man's nature" is unchanging (as Rothbard et al do) is itself to force capitalist assumptions onto the history of the human race.

Wilson then quotes the FAQ again:

Unfortunately for right-Libertarians (and fortunately for the rest of humanity), human beings are not mechanical entities but instead are living, breathing, feeling, hoping, dreaming, changing living organisms.

And states:

"Where precisely have 'right' libertarians denied any of this, and how is this supposed to be a rebuttal to 'right' libertarian theory?"

So a theory which mechanically argues, for example, that "slave contracts" are an expression of liberty is simply nonsense. That is how it is supposed to be a rebuttal to right-libertarian theory -- that it places the theory above common-sense and justifies extreme unfreedom in the name of liberty.

Wilson goes on to argue that "[a]s of so far, the authors have only given a single short and out-of-context example of Nozick's as evidence that 'right' libertarians do not base their theory upon facts, and I have already shown how that example is utterly misleading. Right now, the authors are doing no more than shooting down imaginary positions and citing Bookchin quotes that give bad arguments against the law of identity."

Now, was the Nozick example "out-of-context"? Wilson has not even addressed the example and instead concentrated on another assumption of Nozick's (namely that people have rights -- an intuitive argument which produces some very non-intuitive outcomes, we must note). As far as "bad arguments against the law of identity" goes we have indicated that this is not the case and that Rothbard and Rand base their arguments on said law. So, just to be clear, as "evidence" we presented Nozick, Rand and Rothbard as right-libertarian thinkers who base themselves on assumptions. Far more evidence than Wilson suggests we present.

Wilson then quotes the FAQ again:

From a wider viewpoint, such a rejection of liberty by right-libertarians is unsurprising. They do, after all, support capitalism. Capitalism produces an inverted set of ethics, one in which capital (dead labour) is more important that people (living labour).

And argues that:

"This makes very little sense. If a business owner both purchased capital and hired labours to help him produce, there is no economic reason why one would necessarily be more important than the other."

Moving on Wilson argues:

"The marginal utility of a capital good or a worker would depend upon its marginal product, i.e., the level of output that increases as a result of an additional input. Perhaps the authors find something vulgar about this because certain people are assigning 'utility' to other people. But this means nothing more than that people obtain a measure of subjective value from the presence or activities of a person."

Wilson argues that "[t]his doesn't imply that people are necessarily being misused, and libertarians hold that they aren't, provided that the value one derives from the presence or activities of another doesn't entail that that person's actions are determined in a way that doesn't involve his/her consent."

Which brings us straight back to "consent". So, if the state taxes you then this is wrong because you do not "consent" to it. However, as noted above, you are free to leave a state at any time and seek out a state closer to your desires -- just as the worker is free to seek out a new capitalist. Since the worker does not do this, "anarcho" capitalists assume that the worker "consents" to the rules and orders of her boss. That the same argument can be applied to the state is one that is hotly denied by "anarcho"-capitalists (see section F.2.3).

Now it could be argued that ordering people about is "misusing" them, after all you are subjecting them to your will. Similarly, when the boss orders the worker into dangerous conditions that too could be classed as "misuse". But "consent" is the key and for anarchists capitalism is marked by inequalities that make "consent" purely formal (just as the "consent" associated with the liberal state is purely formal). We discuss this in sections F.2 and F.3 and so will not do so here.

Wilson continues and quotes the FAQ again:

This can be seen when the Ford produced the Pinto. The Pinto had a flaw in it which meant that if it was hit in a certain way in a crash the fuel tank exploded. The Ford company decided it was more "economically viable" to produce that car and pay damages to those who were injured or the relatives of those who died than pay to change the invested capital. The needs of capital came before the needs of the living.

He argues:

"This is an invalid application of the odd statement the authors made above, as well as being an odd and nonsensical statement in its own right. Capital doesn't have needs. Only the living have needs, and the cited case is one in which one group of people perceived it as being to their advantage to sell unsafe automobiles to people willing to buy them. This means that sellers unethically endangered the lives of others for the sake of profit. Under no social arrangement will such a phenomenon always be avoided, but the fact is that there will necessarily be much less of it under an arrangement in which people are legally required to bear the full liability for the costs of their actions. This is the type of arrangement that anarcho-capitalists advocate."

So our point remains. Capitalism does create an environment where people are used as resources by others and the needs of profit are placed before people. Wilson sees that this is the case but refuses to look at why it happens. If he did so then, perhaps, he would realise that capitalist ideology places property before/above liberty (as can be seen from their definitions of "freedom" -- see section F.2) and so the actions of Ford as an expression of a deeper psychosis.

He ends by arguing that:

"It's unclear why the authors need to speak incoherently about 'the needs of capital' to prove a point. Perhaps it's to single out capitalism as the primary cause of the type of disaster that they speak of. Contrary to the false impression that the authors give, such incidents are more likely to occur under a socialistic economy in which the funding of industries are guaranteed, and in which workers have nothing to lose from performing the job in a irresponsible manner. Recently, there have been numerous train crashes in Italy, and many deaths have occurred as a result. Many of the engineers were reportedly drunk while operating the trains. These trains were a part of a socialised railroad scheme. The authors are arbitrarily and unjustly singling out the free market as a producer of defective products and services."

Strange, we were not aware that Italy was a socialistic economy. Nor do we consider nationalised industries the same as "socialised" ones. But let us ignore these obvious points. Wilson presents the example of the drunk engineers as an example of how a "socialistic" economy would create more of the Ford Pinto type situations. Now, did the bosses of the nationalised railways deliberately decide to employ the drunk engineers? Did they do a cost-benefit analysis and decide that employing drunk engineers would be more profitable than sacking them? Of course not. What was a deliberate act on the part of Ford was not done with the nationalised Italian railways. If the managers of the railways had acted in the way that Ford did then Wilson would have had a point, but they did not. His example seems to be an arbitrary and unjust attempt to whitewash the actions prompted by free market pressures.

It seems strange that Wilson does not consider the implications of Ford's acts. After all, most normal people would be horrified by these acts (like the actions of any capitalist firm that harms people in order to make a bit more profit) and seek a reason for them (i.e. in the system that created the pressures Ford and other employers face). However, rather than look at the pressures that resulted in this act, he seems to take them as unavoidable and isolated from the economic system he supports. How strange, but unsurprising.

Critique of Section F.1.3 (Is right-Libertarian theory scientific in nature?)

Wilson starts by quoting the FAQ:

Usually, no. The scientific approach is inductive, the right-Libertarian approach is deductive. The first draws generalisations from the data, the second applies preconceived generalisations to the data. A completely deductive approach is pre-scientific, however, which is why right-Libertarians cannot legitimately claim to use a scientific method. Deduction does occur in science, but the generalisations are primarily based on other data, not a priori assumptions.

And states that:

"This is partially true. It's not true that libertarians reject the method of drawing generalisations upon the basis of data. What libertarians do reject is the position that one can approach aggregate and statistical data with any hope of possibly understanding it if they have not previously laid down a reliable theoretical grounding for it's interpretation. Economic data are highly complex, and it's fallacious to believe that one can infer a causal relationship between two or more macroeconomic phenomena on the basis of observances of correlations. Too many elements play a role in constituting the identity of concepts such as 'GNP', 'GDP', 'the money supply', 'consumption', etc., for one to be able to gain an understanding of them without the aid of 'preconceived generalisations'. This is why libertarians hold that it's necessary to apply a microeconomic theory founded upon generalisations made from simple facts to the study of macroeconomic data."

"Mises indeed held not only that economic theory does not need to be 'tested' by historical fact but also that it cannot be so tested." ["Praxeology: The Methodology of Austrian Economics" in The Foundation of Modern Austrian Economics, p. 32]

And this applies to all data. Including simple data. They argue, in effect (and misleadingly), that the econometrician is a historian not a theorist. Moreover, many economists would argue that using complex data should be taken with care. Now, the claim that it is "necessary to apply a microeconomic theory founded upon generalisations made from simple facts to the study of macroeconomic data" is false, at least from the viewpoint of the Austrian school. They explicitly argue that economic theory cannot be tested and that economic theory is not built upon generalisations from simple facts but rather from logical deductions from assumptions (perhaps these are the "simple facts" that Wilson is referring to but in that case his "simple facts" is the axiom that "humans act" and not, say, simple facts/data gathered from the studying specific events as might be imagined).

Wilson continues by saying "[i]t certainly isn't surprising that the authors derived their (mis)information concerning Austrian economic theory through a secondary source written by an author more in their favour. In light of source of the authors (mis)information, it should be remembered that their (mis)representation of Austrian economics is no more than an interpretation of an interpretation."

But as we will see, nothing could be further from the truth. In the new section F.1.3 we provide more quotes from Austrian sources which state exactly the same thing as we argue here. The Rothbard quote above clearly indicates that our comments are correct. Let us not forget that Austrian economics is based upon deductions from the basic axiom "humans act".

He states that "we arrive at a commonly made, and yet highly fallacious criticism of Austrian economics" namely that (quoting von Mises) that Austrian economics is based upon rejecting any data that conflicts with their theory. This, Wilson argues "constitutes a serious misunderstanding of the importance of Mises' method" and states that "[s]ince the authors do not even mention what Mises' theorems actually are, it's easy for the uneducated reader to dismiss Mises as a crackpot without first understanding him. The methodological individualism and methodological subjectivism of the Austrian school is predicated upon the simple and relatively uncontroversial premise that humans act."

Is the assumptions of the methodology actually relevant to discussing the methodology itself? The assumptions may be "uncontroversial" but if the net result is that you dismiss data that contradicts your theory then the theory itself and its assumptions cannot be evaluated! As Rothbard makes clear, "since praxeology begins with a true axiom, A, all that can be deduced from this axiom must also be true. For if A implies be, and A is true, then B must also be true." [Op. Cit., pp. 19-20] Now A is the premise "humans act" but upon this axiom is built a whole series of other axiom's, all claimed to be true because the first one is true. Given that this premise of one that Proudhon, Marx, Keynes, Kalecki and a host of non-free market economists would have agreed too it seems a very big leap of faith to claim that all the other axioms are true. Now, if the facts of reality are to be dismissed if your theory is logically consistent (after all, that is what von Mises is arguing, let us not forget that) then it is impossible to evaluate your theory and the axioms you have generated. Hence our comments. The methodology von Mises supports means that your theories can never be revised since A was correct. This is the opposite of the scientific method, as we argued.

Wilson states that:

"What the praxeologist methodology intends to do is to explain more holistic economic phenomenon--such as prices, firms, production, etc--through the analysis of the discrete components that give rise to them, namely individual actors purposefully pursuing their own plans and goals on the basis of the information they have access to. It's a microeconomic approach that seeks to inquire into the nature of complex entities by analysing the behaviour of it's simple components. Econometric methods discard human behaviour as irrelevant, and deal solely with aggregate data while attempting to draw inferences of causation through observation of statistical correlation. Too many variables have an influence upon aggregate data for a methodological holist procedure to yield conclusive results explaining human behaviour, and this is why Austrians reject this approach."

Also, when deductively generating axioms from the "simple data" of "humans act", it is easy to discard or ignore forms of human behaviour which do have an impact on the final outcome. Dealing solely with deductive generation can also fail to take into account human behaviour.

Wilson goes on to argue that:

"If theory is grounded in one's knowledge of simple facts (like human action) and deductions made from those facts, yes, it would be silly to accept the validity of aggregate data that conflicts with one's theory. Data is composed of many elements and components, and is far too complex for one understand with a greater degree of certainty than basic facts about human behaviour (e.g. preference, choice, incentives, etc.). If a piece of statistical data yields conclusions that appear to conflict prima faciae with a theoretical framework grounded upon simple observations, it is completely reasonable to either [a] look to see how the statistical data might be misinterpreted, or [b] reject the data. Knowledge of simple data is more reliable than Knowledge of complex data, and without knowledge of simple data it is impossible to interpret complex data. It is always possible that one's theoretical analysis may be invalid, but within the context of the social sciences, it's unwise to determine the validity of one's theory by comparing it to complex data that seems to conflict. One can demonstrate the invalidity of one's theory through logic and conceptual analysis, however."

But, as noted, Austrians think that all economic theories are untestable. Including those based upon "simple data" as opposed to "aggregate data" (and simple data is somewhat different than simple facts). However, by "simple data" Wilson is referring to the axioms derived from the first axiom "humans act". Thus he is arguing that if you base yourself on deductive logic from an initial axiom, then you will not be inclined to view experience as being very useful to evaluating. This approach is taken by most churches who can easily dismiss arguments against the existence of god as being irrelevant to the first axiom that "god exists". Wilson is essentially arguing that we perform a "leap of faith" and join the Austrian school in deductive logic and pre-scientific logic.

Now, the Austrian approach is such that they reject the idea that data can be used to evaluate their claims. They argue even if the facts contradict one of their theories that does not mean that their theories are false, far from it. It just means that in this case their theory was not applicable (see the new section F.1.3 for a quote on this)! Now Wilson seems to be trying to present this argument in the best possible light but it does not change the fact that von Mises and other Austrian's argue that their theories are true no matter what. They are essentially placing their economic ideas above analysis as all and any evidence can be ignored as not applicable in this case -- just, as we may note, religions do.

In contrast to Wilson, we think it is "silly" to have a theory which is grounded in denying and/or rejecting empirical evidence or using empirical evidence to inform your theory. It seems "unwise" to accept a theory which major argument seems to be that it cannot be tested. After all, logic can lead us to many areas and it is only by seeing whether our chain of thought approximates reality can we evaluate the validity of our ideas. If econometric methods discard human behaviour as irrelevant, then so can the Austrian system -- for there are too many variables that can have an influence upon individual acts to yield conclusive results explaining human behaviour. Indeed, the deductive approach may ignore as irrelevant certain human motivations which have a decisive impact on an outcome (there could be a strong tendency to project "Austrian Man" onto the rest of society and history, for example).

Wilson quotes the FAQ again:

Such an approach makes the search for truth a game without rules. The Austrian economists (and other right-libertarians) by using this method are free to theorise anything they want, without such irritating constrictions as facts, statistics, data, history or experimental confirmation. Their only guide is logic. But this is no different from what religions do when they assert the logical existence of God (or Buddha or Mohammed or Gaia). Theories ungrounded in facts and data are easily spun into any belief a person wants. Starting assumptions and trains of logic may contain inaccuracies so small as to be undetectable, yet will yield entirely different conclusions.

And argues that:

"It is certainly the case that certain small and undetectable flaws in one's train of logic can result in horridly inaccurate conclusions, but precisely the same thing can be said concerning statistical and historical analysis. The problem is even more pervasive when dealing with statistical and historical analysis because of the phenomenon of incomplete information. Certain facts will always be unintentionally discarded from the equation, and certain factors responsible for the existence of complex facts and events will always go unaccounted for."

But we are not arguing that we base our theories totally on historical data. Such extreme empiricism is just as false as von Mises method. What we in fact argued that statistical and historical data should be used to back-up any theory we have and if this data disproves our theory then modify the theory, not reject the data. Von Mises' methodology is such that this approach is dismissed (due to the untestability argument) and that is its problem. Without a founding in fact, Austrians are free to theorise about whatever they like, without such irritating constrains as facts, statistics, data, history and so forth. Wilson's arguments have not refuted our analysis, rather he has provided apologetics for von Mises' methodology (a methodology he admits "can result in horridly inaccurate conclusions"). As Austrians can dismiss evidence as "inapplicable" they are in no position to re-evaluate their ideas in the light of reality and so their ideas are little more than dogmas.

Now, how logic chains deduced from axioms can also unintentionally discard certain facts and factors responsible for the existence of complex facts. And the question remains, how do you evaluate whether your logical chains are indeed correct? By evaluating them against reality (i.e. "complex facts"). A given chain of logic does not provide any idea on the relative strengths of certain derived factors (which empirical study can indicate). Nor can it indicate whether the chain is incomplete or missing essential factors. A given chain may be internally consistent but still miss out important factors or stress insignificant ones. So deductive logic has all the problems of statistical analysis and a few more as statistical analysis at least recognises that theories must be evaluated using experience rather than reason alone.

Wilson argues that:

"Most libertarians would find it reasonable to rethink the basic principles or derivations of one's theory if one found them to consistently fail to explain historical events or macroeconomic data, but those of the Austrian persuasion, and even to some extent those of the neoclassical persuasion, would say that the observance of historical and macroeconomic facts is never, in itself, sufficient to invalidate the conclusions of deductive and conceptual analysis."

But let us not forgot that many right-libertarians follow the ideas of Murray Rothbard and Ayn Rand, both firm supporters of Austrian economics. Politically, the dangers of this approach are easily seen. For example, Wilson himself has indicated how his "basic principles" produce relations of domination and oppression which are identical to those created by the state and he sees nothing wrong with this. Similarly, macroeconomic data indicates that capitalism has done best under Keynesianism rather than laissez-faire and the current economic performance in the USA is dependent upon the state maintaining a "natural" rate of unemployment.

Let us not forget that, as Wilson points out, von Mises' method if one used by more mainstream economics as well (as pointed out by Homa Katouzian who, it seems, is are fair more reliable guide than Wilson would like to admit). So, let us be clear, that the case for "free market" capitalism often involves theories which "the observance of historical and macroeconomic facts is never, in itself, sufficient to invalidate." That is some claim. No matter the evidence, capitalist theory cannot be disproved. That says a lot about capitalist economic ideology and its role in society.

Moving on, Wilson again quotes the FAQ:

So, von Mises, Hayek and most right-libertarians reject the scientific method in favour of ideological correctness and so deny the key aspect of both life (change and evolution) and liberty (critical analysis and thought). A true libertarian would approach a contradiction between reality and theory by changing the theory, not by ignoring reality. Right-Libertarian theory is neither libertarian nor scientific.

He then states that:

"Here, the authors demonstrate how ignorant they are of the position they're critiquing. If they had pained themselves to study the primary sources, they would have learned about how Mises and other Austrians were concerned with grounding their theory upon simple observable facts of reality so that they could enable themselves to understand the subjects of macroeconomics and history--two realms of complexity."

Let us not forget that these "simple observable facts" is "humans act" and the axioms deduced from this fact. That is it. This is the "two" realms of complexity -- that individual acts and the resultant of these acts. Now, von Mises argues that (in the quote we provided) that no experience can disprove these derived axioms. If we look at the primary sources (such as these we quote in the new section F.1.3) we find that Austrians are clear about the use of data and how it relates to their theories (which are all deduced from the axiom "humans act" and nothing else). This axiom ("humans act") is the "grounding" of the Austrian theory which Wilson talks about. Everything else flows from this. And anything else above this axiom (or derived axioms) is another "realm of complexity" -- so the actual workings and results of the capitalist system is another realm (which is true, reality is another realm than that of logic deductions within the mind).

So, far from showing "ignorance" all we have done is to point out the implications and religious nature of these perspectives. Austrians "ground" themselves on the axiom "humans act" and argue that simple and/or complex observable facts cannot be used to evaluate the axioms they derive from this initial axiom. Hence our comments and analysis are painfully accurate. Austrian economics is more like a "free market" religion than a scientific analysis of capitalism.

So the primary sources argue that because Austrian economics is based upon the axiom "humans act" all its other axioms and arguments are correct and that these cannot be disproven by experience. Thus our comments on von Mises seem appropriate and the rationale for this rejection of experience seems inappropriate.

Wilson goes on to state that:

"The implication of the views being espoused by the authors above is that it's inappropriate to learn about the world via the application of a methodology. If the authors would alter their methodology (if they have one) every time they stumble across a series of facts that that appear, prima faciae, to conflict with it, then it would appear that the authors see no need for methodology at all, and would prefer to rush headlong into the complex realm of the social sciences, unequipped with any reliable means of interpretation. Now which approach is more closely connected to reality?"

But such an "implication" is so radically false as to be a misrepresentation of our argument. We argued that any analysis or theory we have should be grounded in facts and that if a set of facts contradict our theory then, assuming that the facts are correct of course, change the theory, not deny reality. Quite simple really and a methodology which most people would consider as sensible (assuming that you are not an Austrian economist of course). For example, Proudhon argued that competition tends to undermine competition. That is a theory which can be tested against facts. The facts indicate that, over time, capitalist markets evolve towards oligopoly and that this market power results in super-profits (see sections C.4 and C.5). Now, if the facts indicate that a market does not become dominated by a few firms then we would be inclined to reject that theory. But, if we were Austrians, we could just argue that our theory is true but that it has not been applicable! Now, which approach is more closely connected to reality?

Then, as an aside, Wilson argues that:

"(To accuse Hayek, of all people, of denying change and evolution is simply astounding. When one considers all of his writings on his principle of 'spontaneous order', and on the dispersed evolution of customs within a society, this charge becomes as absurd as one claiming that Noam Chomsky doesn't report upon international politics. The authors are ignoring the primary subject matter of most of Hayek's popular works.)"

Now, unlike Kropotkin who also studied evolution, von Hayek used the example of "evolved" or "spontaneous" order to justify "free market" capitalism rather than to analyse how society itself was evolving and changing. Because (according to von Hayek) the "market" is a "spontaneous order" you should not mess with it. But such an analysis is false as the "order" on the market is dependent on the state determining the rights framework in which this order to generated. Thus, rather than supporting change and evolution, von Hayek's work is about stopping change and evolution (i.e. the change and evolution of society into a different, non-capitalist, form). He supported the state and the capitalist rights it enforces and, moreover, desired to ensure that capitalist property rights were unchangeable by modifying democracy as to place effective power into the hands of a few people (for example, his schemes for using age as a determining, and restricting, factor in voting and being able to occupy a seat in Parliament).

Similarly, his "analysis" of the evolution of customs just assumes that those customs he dislikes (as socialistic or tribal) have been made irrelevant by evolution. However, that is the thing about evolution, you just do not know which of these social customs are required to progress the species. It could be that the social customs von Hayek approves off have been generated within society by state action and would not survive in a truly free society.

And, as the history of capitalism shows, it is very far from an "evolved" order -- state action played a key role in creating it. Thus Hayek's claims are somewhat strange, unless you realise his motivation for them -- namely to counter any attempt to change capitalism into something better.

Thus von Hayek, unlike Kropotkin, can be said to deny change and evolution simply because he assumes that we have reached the "end of history" (to coin a phrase). Just because von Hayek talks about evolution and change does not mean that he supports it. In fact, quite the reverse -- he uses the concepts to try and stop change and evolution.

Wilson concludes as follows:

The real question is why are such theories taken seriously and arouse such interest. Why are they not simply dismissed out of hand,

"Because more honest and responsible people bothered to first come to an understanding of them before passing judgement."

Really? But as we have indicated our comments on right-libertarianism are accurate. That Wilson does not like the way we have presented then, but that does not make them false. Indeed, his "critique" of our account has not found anything incorrect about them, which seems strange for "dishonest" and "irresponsible" people. His comments that we, for example, ignore Nozick's assumption that "individuals have rights" ignores the point we made that Nozick assumes the property rights that are the basis of his system. Instead Wilson discusses something else altogether. Similarly, Wilson's attempt to justify the axiomatic methodology of von Mises fails to appreciate that this methodology cannot be evaluated from looking at the starting axiom as it ensures that its logical chains cannot be tested. Moreover, he attempts to discredit the strawman of extreme empiricism rather than truly addressing the issue that von Mises methodology presents a dogmatic, pre-scientific attitude which has more of a religious feel than anything else. If anything, his comments actually show that we were correct in our analysis -- after all, he has indicated that "anarcho"-capitalists have no problem with capitalist hierarchy, the right-libertarians do based their ideas of assumptions and deductions from these without regard for consequences and that the Austrian school rejects the use of empirical evidence to test their theories.

How strange. Could it be that we have just informed people of a few home truths about right-libertarianism that its supporters prefer to keep quiet about?