# J.5 What alternative social organisations do anarchists create?

Anarchism is all about "do it yourself": people helping each other out in order to secure a good society to live within and to protect, extend and enrich their personal freedom. As such anarchists are keenly aware of the importance of building alternatives to both capitalism and the state in the here and now. Only by creating practical alternatives can we show that anarchism is a viable possibility and train ourselves in the techniques and responsibilities of freedom:

> "If we put into practice the principles of libertarian communism within our organisations, the more advanced and prepared we will be on that day when we come to adopt it completely." [C.N.T. member, quoted by Graham Kelsey, Anarchosyndicalism, Libertarian Communism and the State,p. 79]

This idea (to quote the IWW) of "building a new world in the shell of the old" is a long standing one in anarchism. Proudhon during the 1848 revolution "propose[d] that a provisional committee be set up" in Paris and "liaise with similar committees" elsewhere in France. This would be "a body representative of the proletariat . . ., a state within the state, in opposition to the bourgeois representatives." He proclaimed to working class people that "a new society be founded in the heart of the old society" for "the government can do nothing for you. But you can do everything for yourselves." ["Aux Pariotes", La Représantant du Peuple, No. 33] This was echoed by Bakunin (see section H.2.8) while for revolutionary syndicalists the aim was "to constitute within the bourgeois State a veritable socialist (economic and anarchic) State." [Fernand Pelloutier, quoted by Jeremy Jennings, Syndicalism in France, p. 22] By so doing we help create the environment within which individuals can manage their own affairs and develop their abilities to do so. In other words, we create "schools of anarchism" which lay the foundations for a better society as well as promoting and supporting social struggle against the current system. Make no mistake, the alternatives we discuss in this section are not an alternative to direct action and the need for social struggle - they are an expression of social struggle and a form of direct action. They are the framework by which social struggle can build and strengthen the anarchist tendencies within capitalist society which will ultimately replace it.

Therefore it is wrong to think that libertarians are indifferent to making life more bearable, even more enjoyable, under capitalism. A free society will not just appear from nowhere, it will be created be individuals and communities with a long history of social struggle and organisation. For as Wilheim Reich so correctly pointed out:

> "Quite obviously, a society that is to consist of 'free individuals,' to constitute a 'free community' and to administer itself, i.e. to 'govern itself,' cannot be suddenly created by decrees. It has to evolve organically." [The Mass Psychology of Fascism, p. 241]

It is this organic evolution that anarchists promote when they create libertarian alternatives within capitalist society. These alternatives (be they workplace or community unions, co-operatives, mutual banks, and so on) are marked by certain common features such as being self-managed, being based upon equality, decentralised and working with other groups and associations within a confederal network based upon mutual aid and solidarity. In other words, they are anarchist in both spirit and structure and so create a practical bridge between now and the future free society.

Anarchists consider the building of alternatives as a key aspect of their activity under capitalism. This is because they, like all forms of direct action, are "schools of anarchy" and also because they make the transition to a free society easier. "Through the organisations set up for the defence of their interests," in Malatesta's words, "the workers develop an awareness of the oppression they suffer and the antagonism that divides them from the bosses and as a result begin to aspire to a better life, become accustomed to collective struggle and solidarity and win those improvements that are possible within the capitalist and state regime." [The Anarchist Revolution, p. 95] By creating viable examples of "anarchy in action" we can show that our ideas are practical and convince people that they are not utopian. Therefore this section of the FAQ will indicate the alternatives anarchists support and why we support them.

The approach anarchists take to this activity could be termed "social unionism" -- the collective action of groups to change certain aspects (and, ultimately, all aspects) of their lives. This takes many different forms in many different areas (some of which, not all, are discussed here) -- but they share the same basic aspects of collective direct action, self-organisation, self-management, solidarity and mutual aid. These are a means "of raising the morale of the workers, accustom them to free initiative and solidarity in a struggle for the good of everyone and render them capable of imagining, desiring and putting into practice an anarchist life." [Malatesta, Op. Cit., p. 28] Kropotkin summed up the anarchist perspective well when he argued that working class people had "to form their own organisations for a direct struggle against capitalism" and to "take possession of the necessaries for production, and to control production." [Memiors of a Revolutionist, p. 359] As historian J. Romero Maura correctly summarised, the "anarchist revolution, when it came, would be essentially brought about by the working class. Revolutionaries needed to gather great strength and must beware of underestimating the strength of reaction" and so anarchists "logically decided that revolutionaries had better organise along the lines of labour organisations." ["The Spanish case", pp. 60-83, Anarchism Today, D. Apter and J. Joll (eds.), p. 66]

As will quickly become obvious in this discussion (as if it had not been so before!) anarchists are firm supporters of "self-help," an expression that has been sadly corrupted (like freedom) by the right in recent times. Like freedom, self-help should be saved from the clutches of the right who have no real claim to that expression. Indeed, anarchism was created from and based itself upon working class self-help -- for what other interpretation can be gathered from Proudhon's 1848 statement that "the proletariat must emancipate itself"? [quoted by George Woodcock, Pierre-Joseph Proudhon, p. 125] So Anarchists have great faith in the abilities of working class people to work out for themselves what their problems are and act to solve them.

Anarchist support and promotion of alternatives is a key aspect of this process of self-liberation, and so a key aspect of anarchism. While strikes, boycotts, and other forms of high profile direct action may be more "sexy" than the long and hard task of creating and building social alternatives, these are the nuts and bolts of creating a new world as well as the infrastructure which supports the other activities. These alternatives involve both combative organisations (such as community and workplace unions) as well as more defensive and supportive ones (such as co-operatives and mutual banks). Both have their part to play in the class struggle, although the combative ones are the most important in creating the spirit of revolt and the possibility of creating an anarchist society.

We must also stress that anarchists look to organic tendencies within social struggle as the basis of any alternatives we try to create. As Kropotkin put it, anarchism is based "on an analysis of tendencies of an evolution that is already going on in society, and on induction therefrom as to the future." It is "representative . . . of the creative, instructive power of the people themselves who aimed at developing institutions of common law in order to protect them from the power-seeking minority." Anarchism bases itself on those tendencies that are created by the self-activity of working class people and while developing within capitalism are in opposition to it -- such tendencies are expressed in organisational form as unions and other forms of workplace struggle, co-operatives (both productive and credit), libertarian schools, and so on. For anarchism was "born among the people -- in the struggles of real life and not in the philosopher's studio" and owes its "origin to the constructive, creative activity of the people . . . and to a protest -- a revolt against the external force which had thrust itself upon" social institutions. [Anarchism, p. 158, p. 147, p. 150 and p. 149] This "creative activity" is expressed in the organisations created in the class struggle by working people, some of which we discuss in this section of the FAQ. Therefore, the alternatives anarchists support should not be viewed in isolation of social struggle and working class resistance to hierarchy -- the reverse in fact, as these alternatives are almost always expressions of that struggle.

Lastly, we should note we do not list all the forms of organisation anarchists create. For example, we have ignored solidarity groups (for workers on strike or in defence of struggles in other countries) and organisations which are created to campaign against or for certain issues or reforms. Anarchists are in favour of such organisations and work within them to spread anarchist ideas, tactics and organisational forms. However, these interest groups (while very useful) do not provide a framework for lasting change as do the ones we highlight below (see section J.1.4 for more details on anarchist opinions on such "single issue" campaigns). We have also ignored what have been called "intentional communities." This is when a group of individuals squat or buy land and other resources within capitalism and create their own anarchist commune in it. Most anarchists reject this idea as capitalism and the state must be fought, not ignored. In addition, due to their small size, they are rarely viable experiments in communal living and nearly always fail after a short time (for a good summary of Kropotkin's attitude to such communities, which can be taken as typical, see Graham Purchase's Evolution & Revolution [pp. 122-125]). Dropping out will not stop capitalism and the state and while such communities may try to ignore the system, they will find that the system will not ignore them -- they will come under competitive and ecological pressures from capitalism whether they like it or not assuming they avoid direct political interference.

So the alternatives we discuss here are attempts to create anarchist alternatives within capitalism and which aim to change it (either by revolutionary or evolutionary means). They are based upon challenging capitalism and the state, not ignoring them by dropping out. Only by a process of direct action and building alternatives which are relevant to our daily lives can we revolutionise and change both ourselves and society.

## J.5.1 What is community unionism?

Community unionism is our term for the process of creating participatory communities (called "communes" in classical anarchism) within the current society in order to transform it.

Basically, a community union is the creation of interested members of a community who decide to form an organisation to fight against injustice and improvements locally. It is a forum by which inhabitants can raise issues that affect themselves and others and provide a means of solving these problems. As such, it is a means of directly involving local people in the life of their own communities and collectively solving the problems facing them as both individuals and as part of a wider society. In this way, local people take part in deciding what effects them and their community and create a self-managed "dual power" to the local and national state. They also, by taking part in self-managed community assemblies, develop their ability to participate and manage their own affairs, so showing that the state is unnecessary and harmful to their interests. Politics, therefore, is not separated into a specialised activity that only certain people do (i.e. politicians). Instead, it becomes communalised and part of everyday life and in the hands of all.

As would be imagined, like the participatory communities that would exist in an anarchist society (see section I.5), the community union would be based upon a mass assembly of its members. Here would be discussed the issues that effect the membership and how to solve them. Thus issues like rent increases, school closures, rising cost of living, taxation, cuts and state-imposed "reforms" to the nature and quality of public services, utilities and resources, repressive laws and so on could be debated and action taken to combat them. Like the communes of a future anarchy, these community unions would be confederated with other unions in different areas in order to co-ordinate joint activity and solve common problems. These confederations would be based upon self-management, mandated and recallable delegates and the creation of administrative action committees to see that the memberships decisions are carried out.

The community union could also raise funds for strikes and other social protests, organise pickets, boycotts and generally aid others in struggle. By organising their own forms of direct action (such as tax and rent strikes, environmental protests and so on) they can weaken the state while building an self-managed infrastructure of co-operatives to replace the useful functions the state or capitalist firms currently provide. So, in addition to organising resistance to the state and capitalist firms, these community unions could play an important role in creating an alternative economy within capitalism. For example, such unions could have a mutual bank or credit union associated with them which could allow funds to be gathered for the creation of self-managed co-operatives and social services and centres. In this way a communalised co-operative sector could develop, along with a communal confederation of community unions and their co-operative banks.

Such community unions have been formed in many different countries in recent years to fight against numerous attacks on the working class. In the late 1980s and early 1990s groups were created in neighbourhoods across Britain to organise non-payment of the Conservative government's Community Charge (popularly known as the poll tax, this tax was independent on income and was based on the electoral register). Federations of these groups were created to co-ordinate the struggle and pull resources and, in the end, ensured that the government withdrew the hated tax and helped push Thatcher out of government. In Ireland, similar groups were formed to defeat the privatisation of the water industry by a similar non-payment campaign in the mid-1990s.

However, few of these groups have been taken as part of a wider strategy to empower the local community but the few that have indicate the potential of such a strategy. This potential can be seen from two examples of libertarian community organising in Europe, one in Italy and another in Spain, while the neighbourhood assemblies in Argentina show that such popular self-government can and does develop spontaneously in struggle.

In Southern Italy, anarchists organised a very successful Municipal Federation of the Base (FMB) in Spezzano Albanese. This organisation, in the words of one activist, is "an alternative to the power of the town hall" and provides a "glimpse of what a future libertarian society could be." Its aim is "the bringing together of all interests within the district. In intervening at a municipal level, we become involved not only in the world of work but also the life of the community . . . the FMB make counter proposals [to Town Hall decisions], which aren't presented to the Council but proposed for discussion in the area to raise people's level of consciousness. Whether they like it or not the Town Hall is obliged to take account of these proposals." In addition, the FMB also supports co-operatives within it, so creating a communalised, self-managed economic sector within capitalism. Such a development helps to reduce the problems facing isolated co-operatives in a capitalist economy -- see section J.5.11 -- and was actively done in order to "seek to bring together all the currents, all the problems and contradictions, to seek solutions" to such problems facing co-operatives. ["Community Organising in Southern Italy", pp. 16-19, Black Flag, no. 210, p. 17 and p. 18]

Elsewhere in Europe, the long, hard work of the C.N.T. in Spain has also resulted in mass village assemblies being created in the Puerto Real area, near Cadiz. These community assemblies came about to support an industrial struggle by shipyard workers. One C.N.T. member explains: "Every Thursday of every week, in the towns and villages in the area, we had all-village assemblies where anyone connected with the particular issue [of the rationalisation of the shipyards], whether they were actually workers in the shipyard itself, or women or children or grandparents, could go along . . . and actually vote and take part in the decision making process of what was going to take place." With such popular input and support, the shipyard workers won their struggle. However, the assembly continued after the strike and "managed to link together twelve different organisations within the local area that are all interested in fighting . . . various aspects" of capitalism including health, taxation, economic, ecological and cultural issues. Moreover, the struggle "created a structure which was very different from the kind of structure of political parties, where the decisions are made at the top and they filter down. What we managed to do in Puerto Real was make decisions at the base and take them upwards." [Anarcho-Syndicalism in Puerto Real: from shipyard resistance to direct democracy and community control, p. 6]

More recently, the December 2001 revolt against neo-liberalism in Argentina saw hundreds of neighbourhood assemblies created across the country. These quickly federated into inter-barrial assemblies to co-ordinate struggles. The assemblies occupied buildings, created communal projects like popular kitchens, community centres, day-care centres and built links with occupied workplaces. As one participant put it: "The initial vocabulary was simply: Let's do things for ourselves, and do them right. Let's decide for ourselves. Let's decide democratically, and if we do, then let's explicitly agree that we're all equals here, that there are no bosses . . . We lead ourselves. We lead together. We lead and decide amongst ourselves . . . no one invented it . . . It just happened. We met one another on the corner and decided, enough! . . . Let's invent new organisational forms and reinvent society." Another notes that this was people who "begin to solve problems themselves, without turning to the institutions that caused the problems in the first place." The neighbourhood assemblies ended a system in which "we elected people to make our decisions for us . . . now we will make our own decisions." While the "anarchist movement has been talking about these ideas for years" the movement took them up "from necessity." [Marina Sitrin (ed.), Horizontalism: Voices of Popular Power in Argentina, p. 41 and pp. 38-9]

The idea of community organising has long existed within anarchism. Kropotkin pointed to the directly democratic assemblies of Paris during the French Revolution> These were "constituted as so many mediums of popular administration, it remained of the people, and this is what made the revolutionary power of these organisations." This ensured that the local revolutionary councils "which sprang from the popular movement was not separated from the people." In this popular self-organisation "the masses, accustoming themselves to act without receiving orders from the national representatives, were practising what was described later on as Direct Self-Government." These assemblies federated to co-ordinate joint activity but it was based on their permanence: "that is, the possibility of calling the general assembly whenever it was wanted by the members of the section and of discussing everything in the general assembly." In short, "the Commune of Paris was not to be a governed State, but a people governing itself directly -- when possible -- without intermediaries, without masters" and so "the principles of anarchism . . . had their origin, not in theoretic speculations, but in the deeds of the Great French Revolution." This "laid the foundations of a new, free, social organisation"and Kropotkin predicted that "the libertarians would no doubt do the same to-day." [Great French Revolution, vol. 1, p. 201, p. 203, pp. 210-1, p. 210, p. 204 and p. 206]

In Chile during 1925 "a grass roots movement of great significance emerged," the tenant leagues (ligas do arrendatarios). The movement pledged to pay half their rent beginning the 1st of February, 1925, at huge public rallies (it should also be noted that "Anarchist labour unionists had formed previous ligas do arrendatarios in 1907 and 1914."). The tenants leagues were organised by ward and federated into a city-wide council. It was a vast organisation, with 12,000 tenants in just one ward of Santiago alone. The movement also "press[ed] for a law which would legally recognise the lower rents they had begun paying . . . the leagues voted to declare a general strike . . . should a rent law not be passed." The government gave in, although the landlords tried to get around it and, in response, on April 8th "the anarchists in Santiago led a general strike in support of the universal rent reduction of 50 percent." Official figures showed that rents "fell sharply during 1915, due in part to the rent strikes" and for the anarchists "the tenant league movement had been the first step toward a new social order in Chile." [Peter DeShazo, Urban Workers and Labor Unions in Chile 1902-1927, p. 223, p. 327, p. 223, p. 225 and p. 226] As one Anarchist newspaper put it:

> "This movement since its first moments had been essentially revolutionary. The tactics of direct action were preached by libertarians with highly successful results, because they managed to instil in the working classes the idea that if landlords would not accept the 50 percent lowering of rents, they should pay nothing at all. In libertarian terms, this is the same as taking possession of common property. It completes the first stage of what will become a social revolution." [quoted by DeShazo, Op. Cit., p. 226]

A similar concern for community organising and struggle was expressed in Spain. While the collectives during the revolution are well known, the CNT had long organised in the community and around non-workplace issues. As well as neighbourhood based defence committees to organise and co-ordinate struggles and insurrections, the CNT organised various community based struggles. The most famous example of this must be the rent strikes during the early 1930s in Barcelona. In 1931, the CNT's Construction Union organised a "Economic Defence Commission" to organise against high rents and lack of affordable housing. Its basic demand was for a 40% rent decrease but it also addressed unemployment and the cost of food. The campaign was launched by a mass meeting on May 1st, 1931. A series of meetings were held in the various working class neighbourhoods of Barcelona and in surrounding suburbs. This culminated in a mass meeting held at the Palace of Fine Arts on July 5th which raised a series of demands for the movement. By July, 45,000 people were taking part in the rent strike and this rose to over 100,000 by August. As well as refusing to pay rent, families were placed back into their homes from which they had been evicted. The movement spread to a number of the outlying towns which set up their own Economic Defence Commissions. The local groups co-ordinated actions their actions out of CNT union halls or local libertarian community centres. The movement faced increased state repression but in many parts of Barcelona landlords had been forced to come to terms with their tenants, agreeing to reduced rents rather than facing the prospect of having no income for an extended period or the landlord simply agreed to forget the unpaid rents from the period of the rent strike. [Nick Rider, "The Practice of Direct Action: the Barcelona rent strike of 1931", For Anarchism, David Goodway (ed.), pp. 79-105] As Abel Paz summarised:

> "Unemployed workers did not receive or ask for state aid . . . The workers' first response to the economic crisis was the rent, gas, and electricity strike in mid-1933, which the CNT and FAI's Economic Defence Committee had been laying the foundations for since 1931. Likewise, house, street, and neighbourhood groups began to turn out en masse to stop evictions and other coercive acts ordered by the landlords (always with police support). The people were constantly mobilised. Women and youngsters were particularly active; it was they who challenged the police and stopped the endless evictions." [Durrutu in the Spanish Revolution, p. 308]

In Gijon, the CNT "reinforced its populist image by . . . its direct consumer campaigns. Some of these were organised through the federation's Anti-Unemployment Committee, which sponsored numerous rallies and marches in favour of 'bread and work.' While they focused on the issue of jobs, they also addressed more general concerns about the cost of living for poor families. In a May 1933 rally, for example, demonstrators asked that families of unemployed workers not be evicted from their homes, even if they fell behind on the rent." The "organisers made the connections between home and work and tried to draw the entire family into the struggle." However, the CNT's "most concerted attempt to bring in the larger community was the formation of a new syndicate, in the spring of 1932, for the Defence of Public Interests (SDIP). In contrast to a conventional union, which comprised groups of workers, the SDIP was organised through neighbourhood committees. Its specific purpose was to enforce a generous renters' rights law of December 1931 that had not been vigorously implemented. Following anarchosyndicalist strategy, the SDIP utilised various forms of direct action, from rent strikes, to mass demonstrations, to the reversal of evictions." This last action involved the local SDIP group going to a home, breaking the judge's official eviction seal and carrying the furniture back in from the street. They left their own sign: "opened by order of the CNT." The CNT's direct action strategies "helped keep political discourse in the street, and encouraged people to pursue the same extra-legal channels of activism that they had developed under the monarchy." [Pamela Beth Radcliff, From mobilization to civil war, pp. 287-288 and p. 289]

In these ways, grassroots movements from below were created, with direct democracy and participation becoming an inherent part of a local political culture of resistance, with people deciding things for themselves directly and without hierarchy. Such developments are the embryonic structures of a world based around participation and self-management, with a strong and dynamic community life. For, as Martin Buber argued, "[t]he more a human group lets itself be represented in the management of its common affairs . . . the less communal life there is in it and the more impoverished it becomes as a community." [Paths in Utopia, p. 133]

Anarchist support and encouragement of community unionism, by creating the means for communal self-management, helps to enrich the community as well as creating the organisational forms required to resist the state and capitalism. In this way we build the anti-state which will (hopefully) replace the state. Moreover, the combination of community unionism with workplace assemblies (as in Puerto Real), provides a mutual support network which can be very effective in helping winning struggles. For example, in Glasgow, Scotland in 1916, a massive rent strike was finally won when workers came out in strike in support of the rent strikers who been arrested for non-payment. Such developments indicate that Isaac Puente was correct:

> "Libertarian Communism is a society organised without the state and without private ownership. And there is no need to invent anything or conjure up some new organisation for the purpose. The centres about which life in the future will be organised are already with us in the society of today: the free union and the free municipality [or Commune].

> "The union: in it combine spontaneously the workers from factories and all places of collective exploitation.

> "And the free municipality: an assembly . . . where, again in spontaneity, inhabitants . . . combine together, and which points the way to the solution of problems in social life . . .

> "Both kinds of organisation, run on federal and democratic principles, will be sovereign in their decision making, without being beholden to any higher body, their only obligation being to federate one with another as dictated by the economic requirement for liaison and communications bodies organised in industrial federations.

> "The union and the free municipality will assume the collective or common ownership of everything which is under private ownership at present [but collectively used] and will regulate production and consumption (in a word, the economy) in each locality.

"The very bringing together of the two terms (communism and libertarian) is indicative in itself of the fusion of two ideas: one of them is collectivist, tending to bring about harmony in the whole through the contributions and co-operation of individuals, without undermining their independence in any way; while the other is individualist, seeking to reassure the individual that his independence will be respected." [Libertarian Communism, pp. 6-7]

The combination of community unionism, along with industrial unionism (see next section), will be the key to creating an anarchist society, Community unionism, by creating the free commune within the state, allows us to become accustomed to managing our own affairs and seeing that an injury to one is an injury to all. In this way a social power is created in opposition to the state. The town council may still be in the hands of politicians, but neither they nor the central government would be able to move without worrying about what the people's reaction might be, as expressed and organised in their community assemblies and federations.

## J.5.2 Why do anarchists support industrial unionism?

Simply because it is effective in resisting capitalist exploitation and winning reforms, ending capitalist oppression and expresses our ideas on how industry will be organised in an anarchist society. For workers "have the most enormous power in their hands, and, if they once become thoroughly conscious of it and used it, nothing could withstand them; they would only have to stop labour, regard the product of labour as theirs, and enjoy it. This is the sense of the labour disturbances which show themselves here and there." [Max Stirner, The Ego and Its Own, p. 116] Industrial unionism is simply libertarian workplace organisation and is the best way of organising and exercising this power.

Before discussing why anarchists support industrial unionism, we must point out that the type of unionism anarchists support has very little in common with that associated with reformist unions like the TUC in Britain or the AFL-CIO in the USA (see next section). In such unions, as Alexander Berkman pointed out, the "rank and file have little say. They have delegated their power to leaders, and these have become the boss . . . Once you do that, the power you have delegated will be used against you and your interests every time." [What is Anarchism?, p. 205] Reformist unions, even if they do organise by industry rather than by trade or craft, are top-heavy and bureaucratic. Thus they are organised in the same manner as capitalist firms or the state -- and like both of these, the officials at the top have different interests than those at the bottom. Little wonder anarchists oppose such forms of unionism as being counter to the interests of their members. The long history of union officials betraying their members is proof enough of this.

Anarchists propose a different kind of workplace organisation, one that is organised in a different manner than the mainstream unions. We will call this new kind of organisation "industrial unionism" (although perhaps industrial syndicalism, or just syndicalism, might be a better name for it). Some anarchists (particularly communist-anarchists) reject calling these workplace organisations "unions" and instead prefer such terms as workplace resistance groups, workplace assemblies and workers councils. No matter what they are called, all class struggle anarchists support the same organisational structure we are going to outline. It is purely for convenience that we term this industrial unionism.

An industrial union is a union which organises all workers in a given workplace and so regardless of their actual trade everyone would be in the one union. On a building site, for example, brick-layers, plumbers, carpenters and so on would all be a member of the Building Workers Union. Each trade may have its own sections within the union (so that plumbers can discuss issues relating to their trade for example) but the core decision making focus would be an assembly of all workers employed in a workplace. As they all have the same employer, the same exploiter, it is logical for them to have the same union.

It is organised by the guiding principle that workers should directly control their own organisations and struggles. It is based upon workplace assemblies because workers have "tremendous power" as the "creator of all wealth" but "the strength of the worker is not in the union meeting-hall; it is in the shop and factory, in the mill and mine. It is there that he [or she] must organise; there, on the job." It is there that workers "decide the matters at issue and carry their decisions out through the shop committees" (whose members are "under the direction and supervision of the workers" and can be "recalled at will"). These committees are "associated locally, regionally and nationally" to produce "a power tremendous in its scope and potentialities." [Berkman, Op. Cit., pp. 205-6] This confederation is usually organised on two directions, between different workplaces in the same industry as well as between different workplaces in the same locality.

So industrial unionism is different from ordinary trade unionism (usually called business unionism by anarchists and syndicalists as it treats the union's job purely as the seller of its members' labour power). It is based on unions managed directly by the rank and file membership rather than by elected officials and bureaucrats. The industrial union is not based on where the worker lives (as is the case with many trade unions). Instead, the union is based and run from the workplace. It is there that union meetings are held, where workers are exploited and oppressed and where their economic power lies. Industrial unionism is based on local branch autonomy, with each branch managing its own affairs. No union officials have the power to declare strikes "unofficial" as every strike is decided upon by the membership is automatically "official" simply because the branch decided it in a mass meeting.

Power in such an organisation would be decentralised into the hands of the membership, as expressed in local workplace assemblies. To co-ordinate strikes and other forms of action, these autonomous branches are part of a federal structure. The mass meeting in the workplace mandates delegates to express the wishes of the membership at "labour councils" and "industrial federations." The labour council ("Brouse du Travail", in French) is the federation of all workplace branches of all industries in a geographical area (say, for example, in a city or region) and it has the tasks of, among other things, education, propaganda and the promotion of solidarity between the different workplaces in its area. Due to the fact it combines all workers into one organisation, regardless of industry or union, the labour council plays a key role in increasing class consciousness and solidarity. The industrial federation organises all workplaces in the same industry so ensuring that workers in one part of the country or world are not producing goods so that the bosses "can supply the market and lose nothing by the strike". So these federations are "organised not by craft or trade but by industries, so that the whole industry -- and if necessary the whole working class -- could strike as one man." If that were done "would any strike be lost?" [Berkman, Op. Cit., p. 82] In practice, of course, the activities of these dual federations would overlap: labour councils would support an industry wide strike or action while industrial unions would support action conducted by its member unions called by labour councils.

However, industrial unionism should not be confused with a closed shop situation where workers are forced to join a union when they become a wage slave in a workplace. While anarchists do desire to see all workers unite in one organisation, it is vitally important that workers can leave a union and join another. The closed shop only empowers union bureaucrats and gives them even more power to control (and/or ignore) their members. As anarchist unionism has no bureaucrats, there is no need for the closed shop and its voluntary nature is essential in order to ensure that a union be subject to "exit" as well as "voice" for it to be responsive to its members wishes. As Albert Meltzer argued, the closed shop means that "the [trade union] leadership becomes all-powerful since once it exerts its right to expel a member, that person is not only out of the union, but out of a job." Anarcho-syndicalism, therefore, "rejects the closed shop and relies on voluntary membership, and so avoids any leadership or bureaucracy." [Anarchism: Arguments for and against, p. 56] Without voluntary membership even the most libertarian union may become bureaucratic and unresponsive to the needs of its members and the class struggle (also see Tom Wetzel's excellent article "The Origins of the Union Shop", [Ideas & Action no. 11]). Needless to say, if the union membership refuses to work with non-union members then that is a different situation. Then this is an issue of free association (as free association clearly implies the right not to associate). This issue rarely arises and most syndicalist unions operate in workplaces with other unions (the excepts arise, as happened frequently in Spanish labour history with the Marxist UGT, when the other union scabs when workers are on strike).

In industrial unionism, the membership, assembled in their place of work, are the ones to decide when to strike, when to pay strike pay, what tactics to use, what demands to make, what issues to fight over and whether an action is "official" or "unofficial". In this way the rank and file is in control of their union and, by confederating with other assemblies, they co-ordinate their forces with their fellow workers. As syndicalist activist Tom Brown made clear:

> "The basis of the Syndicate is the mass meeting of workers assembled at their place of work . . . The meeting elects its factory committee and delegates. The factory Syndicate is federated to all other such committees in the locality . . . In the other direction, the factory, let us say engineering factory, is affiliated to the District Federation of Engineers. In turn the District Federation is affiliated to the National Federation of Engineers . . . Then, each industrial federation is affiliated to the National Federation of Labour . . . how the members of such committees are elected is most important. They are, first of all, not representatives like Members of Parliament who air their own views; they are delegates who carry the message of the workers who elect them. They do not tell the workers what the 'official' policy is; the workers tell them.

> "Delegates are subject to instant recall by the persons who elected them. None may sit for longer than two successive years, and four years must elapse before his [or her] next nomination. Very few will receive wages as delegates, and then only the district rate of wages for the industry . . .

> "It will be seen that in the Syndicate the members control the organisation -- not the bureaucrats controlling the members. In a trade union the higher up the pyramid a man is the more power he wields; in a Syndicate the higher he is the less power he has.

> "The factory Syndicate has full autonomy over its own affairs." [Syndicalism, pp. 35-36]

Such federalism exists to co-ordinate struggle, to ensure that solidarity becomes more than a word written on banners. We are sure that many radicals will argue that such decentralised, confederal organisations would produce confusion and disunity. However, anarchists maintain that the statist, centralised form of organisation of the trades unions would produce indifference instead of involvement, heartlessness instead of solidarity, uniformity instead of unity, and elites instead of equality. The centralised form of organisation has been tried and tried again -- it has always failed. This is why the industrial union rejects centralisation, for it "takes control too far away from the place of struggle to be effective on the workers' side." [Brown, Op. Cit., p. 34] Centralisation leads to disempowerment, which in turn leads to indifference, not solidarity. Rudolf Rocker reminds us of the evil effects of centralism when he wrote:

> "For the state centralisation is the appropriate form of organisation, since it aims at the greatest possible uniformity in social life for the maintenance of political and social equilibrium. But for a movement whose very existence depends on prompt action at any favourable moment and on the independent thought and action of its supporters, centralism could but be a curse by weakening its power of decision and systematically repressing all immediate action. If, for example, as was the case in Germany, every local strike had first to be approved by the Central, which was often hundreds of miles away and was not usually in a position to pass a correct judgement on the local conditions, one cannot wonder that the inertia of the apparatus of organisation renders a quick attack quite impossible, and there thus arises a state of affairs where the energetic and intellectually alert groups no longer serve as patterns for the less active, but are condemned by these to inactivity, inevitably bringing the whole movement to stagnation. Organisation is, after all, only a means to an end. When it becomes an end in itself, it kills the spirit and the vital initiative of its members and sets up that domination by mediocrity which is the characteristic of all bureaucracies." [Anarcho-Syndicalism, p. 61]

Centralised unions ensure that it is the highest level of union officialdom which decides when workers are allowed to strike. Instead of those affected acting, "the dispute must be reported to the district office of the union (and in some cases to an area office) then to head office, then back again . . . The worker is not allowed any direct approach to, or control of the problem." [Brown, Op. Cit., p. 34] The end result is that "through the innate conservatism of officialdom" officials in centralised unions "ordinarily use their great powers to prevent strikes or to drive their unions' members back to work after they have struck in concert with other workers." The notion that a centralised organisation will be more radical "has not developed in practice" and the key problem "is due not to the autonomy of the unions, but to the lack of it." [Earl C. Ford and William Z. Foster, Syndicalism, p. 38] So the industrial union "is based on the principles of Federalism, on free combination from below upwards, putting the right of self-determination . . . above everything else" and so rejects centralism as an "artifical organisation from above downwards which turns over the affairs of everybody in a lump to a small minority" and is "always attended by barren official routine" as well as "lifeless discipline and bureaucratic ossification." [Rocker, Op. Cit., p. 60]

This implies that as well as being decentralised and organised from the bottom up, the industrial union differs from the normal trade union by having no full-time officials. All union business is conducted by elected fellow workers who do their union activities after work or, if it has to be done during work hours, they get the wages they lost while on union business. In this way no bureaucracy of well paid officials is created and all union militants remain in direct contact with their fellow workers. Given that it is their wages, working conditions and so on that are effected by their union activity they have a real interest in making the union an effective organisation and ensuring that it reflects the interests of the rank and file. In addition, all part-time union "officials" are elected, mandated and recallable delegates. If the fellow worker who is elected to the local labour council or other union committee is not reflecting the opinions of those who mandated him or her then the union assembly can countermand their decision, recall them and replace them with someone who will reflect these decisions. In short, "the Syndicalist stands firmly by these things -- mass meetings, delegates not bosses, the right of recall . . . Syndicalism is organised from the bottom upwards . . . all power comes from below and is controlled from below. This is a revolutionary principle." [Brown, Op. Cit., p. 85]

As can be seen, industrial unionism reflects anarchist ideas of organisation -- it is organised from the bottom up, it is decentralised and based upon federation and it is directly managed by its members in mass assemblies. It is anarchism applied to industry and the needs of the class struggle. By supporting such forms of organisations, anarchists are not only seeing "anarchy in action", they are forming effective tools which can win the class war. By organising in this manner, workers are building the framework of a co-operative society within capitalism:

> "the syndicate . . . has for its purpose the defence of the interests of the producers within existing society and the preparing for and the practical carrying out of the reconstruction of social life . . . It has, therefore, a double purpose: 1. As the fighting organisation of the workers against their employers to enforce the demands of the workers for the safeguarding of their standard of living; 2. As the school for the intellectual training of the workers to make them acquainted with the technical management of production and economic life in general, so that when a revolutionary situation arises they will be capable of taking the socio-economic organism into their own hands and remaking it according to Socialist principles." [Rocker, Op. Cit., pp. 56-7]

So "[a]t the same time that syndicalism exerts this unrelenting pressure on capitalism, it tries to build the new social order within the old. The unions and the 'labour councils' are not merely means of struggle and instruments of social revolution; they are also the very structure around which to build a free society. The workers are to be educated in the job of destroying the old propertied order and in the task of reconstructing a stateless, libertarian society. The two go together." [Murray Bookchin, The Spanish Anarchists, p. 121] The industrial union is seen as prefiguring the future society, a society which (like the union) is decentralised and self-managed in all aspects.

Given the fact that workers wages have been stagnating (or, at best, falling behind productivity increases) across the world as the trade unions have been weakened and marginalised (partly because of their own tactics, structure and politics) it is clear that there exists a great need for working people to organise to defend themselves. The centralised, top-down trade unions we are accustomed to have proved themselves incapable of effective struggle (and, indeed, the number of times they have sabotaged such struggle are countless -- a result not of "bad" leaders but of the way these unions organise and their role within capitalism). Hence anarchists support industrial unionism as an effective alternative to the malaise of official trade unionism. How anarchists aim to encourage such new forms of workplace organisation and struggle will be discussed in the section J.5.4.

One last point. We noted that many anarchists, particularly communist-anarchists, consider unions, even anarchosyndicalist ones, as having a strong reformist tendency (as discussed in section J.3.9). However, all anarchists recognise the importance of autonomous class struggle and the need for organisations to help fight that struggle. Thus anarchist-communists, instead of trying to organise industrial unions, apply the ideas of industrial unionism to workplace struggles. They would agree with the need to organise all workers into a mass assembly and to have elected, recallable administration committees to carry out the strikers wishes. This means that while such anarchists do not call their practical ideas "anarcho-syndicalism" nor the workplace assemblies they desire to create "unions," there are extremely similar in nature and so we can discuss both using the term "industrial unionism". The key difference is that many (if not most) anarcho-communists consider that permanent workplace organisations that aim to organise all workers would become reformist. Because of this they also see the need for anarchist to organise as anarchists in order to spread the anarchist message within them and keep their revolutionary aspects at the forefront.

Spontaneously created organisations of workers in struggle play an important role in both communist-anarchist and anarcho-syndicalist theory. Since both advocate that it is the workers, using their own organisations who will control their own struggles (and, eventually, their own revolution) in their own interests, not a vanguard party of elite political theorists, this is unsurprising. It matters little if the specific organisations are revolutionary industrial unions, factory committees, workers councils, or other labour formations. The important thing is that they are created and run by workers themselves. Meanwhile, anarchists are industrial guerrillas waging class war at the point of production in order to win improvements in the here and now and strengthen tendencies towards anarchism by showing that direct action and libertarian organisation is effective and can win partial expropriations of capitalist and state power. So while there are slight differences in terminology and practice, all anarchists would support the ideas of industrial organisation and struggle we have outlined above.

## J.5.3 What attitude do anarchists take to existing unions?

As noted in the last section, anarchists desire to create organisations in the workplace radically different from the existing unions. The question now arises, what attitude do anarchists take to trade unions?

Before answering that question, we must stress that anarchists, no matter how hostile to trade unions as bureaucratic, reformist institutions, are in favour of working class struggle. This means that when trade union members or other workers are on strike anarchists will support them (unless the strike is reactionary -- for example, no anarchist would support a strike which is racist in nature). This is because anarchists consider it basic to their politics that you do not scab and you do not crawl. So, when reading anarchist criticisms of trade unions do not for an instant think we do not support industrial struggles -- we do, we are just very critical of the unions that are sometimes involved.

So, what do anarchists think of the trade unions?

For the most part, one could call the typical anarchist opinion toward them as one of "hostile support." It is hostile insofar as anarchists are well aware of how bureaucratic these unions are and how they continually betray their members. Given that they are usually little more than "business" organisations, trying to sell their members labour-power for the best deal possible, it is unsurprising that they are bureaucratic and that the interests of the bureaucracy are at odds with those of its membership. However, our attitude is "supportive" in that even the worse trade union represents an attempt at working class solidarity and self-help, even if the organisation is now far removed from the initial protests and ideas that set the union up. For a worker to join a trade union means recognising, to some degree, that he or she has different interests from their boss ("If the interests of labour and capital are the same, why the union?" [Alexander Berkman, What is Anarchism?, p. 76]).

There is no way to explain the survival of unions other than the fact that there are different class interests and workers have understood that to promote their own interests they have to organise collectively. No amount of conservatism, bureaucracy or backwardness within the unions can obliterate this. The very existence of trade unions testifies to the existence of some level of basic class consciousness and the recognition that workers and capitalists do not have the same interests. Claims by trade union officials that the interests of workers and bosses are the same theoretically disarms both the union and its members and so weakens their struggles (after all, if bosses and workers have similar interests then any conflict is bad and the decisions of the boss must be in workers' interests!). That kind of nonsense is best left to the apologists of capitalism (see section F.3.2).

It is no surprise, then, the "extreme opposition to the existing political and economic power" to unions as they "not only suspected every labour organisation of aiming to improve the condition of its members within the limits of the wage system, but they also looked upon the trade union as the deeply enemy of wage-slavery -- and they were right. Every labour organisation of sincere character must needs wage war upon the existing economic conditions, since the continuation of the same is synonymous with the exploitation and enslavement of labour." [Max Baginski, "Aim and Tactics of the Trade-Union Movement", pp. 297-306, Anarchy! An Anthology of Emma Goldman's Mother Earth, Peter Glassgold (ed.), pp. 302-3] Thus anarchist viewpoints on this issue reflect the contradictory nature of trade unions -- on the one hand they are products of workers' struggle, but on the other they are bureaucratic, unresponsive, centralised and their full-time officials have no real interest in fighting against wage labour as it would put them out of a job. Indeed, the very nature of trade unionism ensures that the interests of the union (i.e. the full-time officials) come into conflict with the people they claim to represent.

This can best be seen from the disgraceful activities of the TGWU with respect to the Liverpool dockers in Britain. The union officials (and the TUC itself) refused to support their members after they had been sacked in 1995 for refusing to cross a picket line. The dockers organised their own struggle, contacting dockers' unions across the world and organised global solidarity actions. Moreover, a network of support groups sprung up across Britain to gather funds for their struggle (and, we are proud to note, anarchists have played their role in supporting the strikers). Many trade unionists could tell similar stories of betrayal by "their" union.

This occurs because trade unions, in order to get recognition from a company, must be able to promise industrial peace. They need to enforce the contracts they sign with the bosses, even if this goes against the will of its members. Thus trade unions become a third force in industry, somewhere between management and the workers and pursuing its own interests. This need to enforce contracts soon ensures that the union becomes top-down and centralised -- otherwise its members would violate the unions agreements. They have to be able to control their members -- which usually means stopping them fighting the boss -- if they are to have anything to bargain with at the negotiation table. This may sound odd, but the point is that the union official has to sell the employer labour discipline and freedom from unofficial strikes as part of its side of the bargain otherwise the employer will ignore them.

The nature of trade unionism, then, is to take power away from out of local members and centralise it into the hands of officials at the top of the organisation. Thus union officials sell out their members because of the role trade unions play within society, not because they are nasty individuals (although some are). They behave as they do because they have too much power and, being full-time and highly paid, are unaccountable, in any real way, to their members. Power -- and wealth -- corrupts, no matter who you are (see Chapter XI of Alexander Berkman's What is Anarchism? for an excellent introduction to anarchist viewpoints on trade unions).

While, in normal times, most workers will not really question the nature of the trade union bureaucracy, this changes when workers face some threat. Then they are brought face to face with the fact that the trade union has interests separate from theirs. Hence we see trade unions agreeing to wage cuts, redundancies and so on -- after all, the full-time trade union official's job is not on the line! But, of course, while such a policy is in the short term interests of the officials, in the longer term it goes against their interests -- who wants to join a union which rolls over and presents no effective resistance to employers? Little wonder Michael Moore had a chapter entitled "Why are Union Leaders So F#!@ing Stupid?" in his book Downsize This! -- essential reading on how moronic trade union bureaucrats can actually be. Sadly trade union bureaucracy seems to afflict all who enter it with short-sightedness -- although the chickens do, finally, come home to roost, as the bureaucrats of the AFL, TUC and other trade unions are finding out in this era of global capital and falling membership. So while the activities of trade union leaders may seem crazy and short-sighted, these activities are forced upon them by their position and role within society -- which explains why they are so commonplace and why even radical leaders end up doing exactly the same thing in time.

However, few anarchists would call upon members of a trade union to tear-up their membership cards. While some anarchists have nothing but contempt (and rightly so) for trade unions (and so do not work within them -- but will support trade union members in struggle), the majority of anarchists take a more pragmatic viewpoint. If no alternative syndicalist union exists, anarchists will work within the existing unions (perhaps becoming shop-stewards -- few anarchists would agree to be elected to positions above this in any trade union, particularly if the post were full-time), spreading the anarchist message and trying to create a libertarian undercurrent which would hopefully blossom into a more anarchistic labour movement. So most anarchists "support" the trade unions only until we have created a viable libertarian alternative. Thus we will become trade union members while trying to spread anarchist ideas within and outwith them. This means that anarchists are flexible in terms of our activity in the unions. For example, many IWW members were "two-carders" which meant they were also in the local AFL branch in their place of work and turned to the IWW when the AFL hierarchy refused to back strikes or other forms of direct action.

Anarchist activity within trade unions reflects our ideas on hierarchy and its corrupting effects. We reject the response of left-wing social democrats, Stalinists and mainstream Trotskyists to the problem of trade union betrayal, which is to try and elect 'better' officials. They see the problem primarily in terms of the individuals who hold the posts so ignoring the fact that individuals are shaped by the environment they live in and the role they play in society. Thus even the most left-wing and progressive individual will become a bureaucrat if they are placed within a bureaucracy.

We must note that the problem of corruption does not spring from the high-wages officials are paid (although this is a factor), but from the power they have over their members (which partly expresses itself in high pay). Any claim that electing "radical" full-time officials who refuse to take the high wages associated with the position will be better is false. The hierarchical nature of the trade union structure has to be changed, not side-effects of it. As the left has no problem with hierarchy as such, this explains why they support this form of "reform." They do not actually want to undercut whatever dependency the members have on leadership, they want to replace the leaders with "better" ones (i.e. themselves or members of their party) and so endlessly call upon the trade union bureaucracy to act for its members. In this way, they hope, trade unionists will see the need to support a "better" leadership -- namely themselves. Anarchists, in stark contrast, think that the problem is not that the leadership of the trade unions is weak, right-wing or does not act but that the union's membership follows them. Thus anarchists aim at undercutting reliance on leaders (be they left or right) by encouraging self-activity by the rank and file and awareness that hierarchical leadership as such is bad, not individual leaders. Anarchists encourage rank and file self-activity, not endless calls for trade union bureaucrats to act for us (as is unfortunately far too common on the left).

Instead of "reform" from above (which is doomed to failure), anarchists work at the bottom and attempt to empower the rank and file of the trade unions. It is self-evident that the more power, initiative and control that lies on the shop floor, the less the bureaucracy has. Thus anarchists work within and outwith the trade unions in order to increase the power of workers where it actually lies: at the point of production. This is usually done by creating networks of activists who spread anarchist ideas to their fellow workers (see next section). Hence Malatesta:

> "The anarchists within the unions should strive to ensure that they remain open to all workers of whatever opinion or party on the sole condition that there is solidarity in the struggle against the bosses. They should oppose the corporatist spirit and any attempt to monopolise labour or organisation. They should prevent the Unions from becoming the tools of the politicians for electoral or other authoritarian ends; they should preach and practice direct action, decentralisation, autonomy and free initiative. They should strive to help members learn how to participate directly in the life of the organisation and to do without leaders and permanent officials.

> "They must, in short, remain anarchists, remain always in close touch with anarchists and remember that the workers' organisation is not the end but just one of the means, however important, of preparing the way for the achievement of anarchism." [The Anarchist Revolution, pp. 26-7]

As part of this activity anarchists promote the ideas of Industrial Unionism we highlighted in the last section -- namely direct workers control of struggle via workplace assemblies and recallable committees -- during times of struggle. However, anarchists are aware that economic struggle (and trade unionism as such) "cannot be an end in itself, since the struggle must also be waged at a political level to distinguish the role of the State." [Malatesta, Errico Malatesta: His Life and Ideas, p, 115] Thus, as well as encouraging worker self-organisation and self-activity, anarchist groups also seek to politicise struggles and those involved in them. Only this process of self-activity and political discussion between equals within social struggles can ensure the process of working class self-liberation and the creation of new, more libertarian, forms of workplace organisation.

The result of such activity may be a new form of workplace organisation (either workplace assemblies or an anarcho-syndicalist union) or a reformed, more democratic version of the existing trade union (although few anarchists believe that the current trade unions can be reformed). Either way, the aim is to get as many members of the current labour movement to become anarchists as possible or, at the very least, take a more libertarian and radical approach to their unions and workplace struggle.

## J.5.4 What are industrial networks?

Industrial networks are the means by which revolutionary industrial unions and other forms of libertarian workplace organisation can be created. The idea of Industrial Networks originated with the British section of the anarcho-syndicalist International Workers Association in the late 1980s. It was developed as a means of promoting libertarian ideas within the workplace, so creating the basis on which a workplace movement based upon the ideas of industrial unionism (see section J.5.2) could grow and expand.

The idea is very simple. An Industrial Network is a federation of militants in a given industry who support the ideas of anarchism and/or anarcho-syndicalism, namely direct action, solidarity and organisation from the bottom up (the difference between purely anarchist networks and anarcho-syndicalist ones will be highlighted later). It would "initially be a political grouping in the economic sphere, aiming to build a less reactive but positive organisation within the industry. The long term aim . . . is, obviously, the creation of an anarcho-syndicalist union." [Winning the Class War, p. 18]

The Industrial Network would be an organisation of groups of libertarians within a workplace united on an industrial basis. They would pull their resources together to fund a regular bulletin and other forms of propaganda which they would distribute within their workplaces. These bulletins and leaflets would raise and discuss issues related to work, how to fight back and win as well as placing workplace issues in a social and political context. This propaganda would present anarchist ideas of workplace organisation and resistance as well as general anarchist ideas and analysis. In this way anarchist ideas and tactics would be able to get a wider hearing and anarchists can have an input as anarchists into workplace struggles.

Traditionally, many syndicalists and anarcho-syndicalists advocated the One Big Union strategy, the aim of which was to organise all workers into one organisation representing the whole working class. Today, however, most anarcho-syndicalists, like other revolutionary anarchists, advocate workers assemblies for decision making during struggles which are open to all workers (union members or not) as they recognise that they face dual unionism (which means there are more than one union within a given workplace or country). This was the case, historically, in all countries with a large syndicalist union movement there were also socialist unions. Therefore most anarcho-syndicalists do not expect to ever get a majority of the working class into a revolutionary union before a revolutionary situation develops. In addition, revolutionary unions do not simply appear, they develop from previous struggles and require a lot of work and experience of which the Industrial Networks are but one aspect. The most significant revolutionary unions (such as the IWW, USI and CNT) were originally formed by unions and union militants with substantial experience of struggle behind them, some of whom were part of existing trade union bodies.

Thus industrial networks are intended to deal with the actual situation that confronts us, and provide a strategy for moving from our present reality toward out ultimate goals. The role of the anarchist group or syndicalist union would be to call workplace assemblies and their federation into councils, argue for direct workers control of struggle by these mass assemblies, promote direct action and solidarity, put across anarchist ideas and politics and keep things on the boil, so to speak. When one has only a handful of anarchists and syndicalists in a workplace or scattered across several workplaces there is a clear need for developing ways for these fellow workers to effectively act in union, rather than be isolated and relegated to more general agitation. A handful of anarchists cannot meaningfully call a general strike but we can agitate around specific industrial issues and organise our fellow workers to do something about them. Through such campaigns we demonstrate the advantages of rank-and-file unionism and direct action, show our fellow workers that our ideas are not mere abstract theory but can be implemented here and now, attract new members and supporters, and further develop our capacity to develop revolutionary unions in our workplaces. Thus the creation of Industrial Networks and the calling for workplace assemblies is a recognition of where we are now -- with anarchist ideas very much in the minority. Calling for workers assemblies is not an anarchist tactic per se, we must add, but a working class one developed and used plenty of times by workers in struggle (indeed, it was how the current trade unions were created). It also puts the onus on the reformists unions by appealing directly to their members as workers and exposing their bureaucrat organisations and reformist politics by creating an effective alternative to them.

A few anarchists reject the idea of Industrial Networks and instead support the idea of "rank and file" groups which aim to put pressure on the current trade unions to become more militant and democratic. Some even think that such groups can be used to reform the trade-unions into libertarian, revolutionary organisations -- called "boring from within" -- but most reject this as utopian, viewing the trade union bureaucracy as unreformable as the state's (and it is likely that rather than change the trade union, "boring from within" would change the syndicalists by watering down their ideas). Moreover, opponents of "rank and file" groups argue that they direct time and energy away from practical and constructive activity and instead waste them "[b]y constantly arguing for changes to the union structure . . . the need for the leadership to be more accountable, etc., [and so] they not only [offer] false hope but [channel] energy and discontent away from the real problem -- the social democratic nature of reformist trade unions." [Op. Cit., p. 11]

Supporters of the "rank and file" approach fear that the Industrial Networks will isolate anarchists from the mass of trade union members by creating tiny "pure" syndicalist groups. Such a claim is rejected by supporters of Industrial Networks who argue that rather than being isolated from the majority of trade unionists they would be in contact with them where it counts, in the workplace and in struggle rather than in trade union meetings which many workers do not even attend:

> "We have no intention of isolating ourselves from the many workers who make up the rest of the rank and file membership of the unions. We recognise that a large proportion of trade union members are only nominally so as the main activity of social democratic unions is outside the workplace . . . We aim to unite and not divide workers.

> "It has been argued that social democratic unions will not tolerate this kind of activity, and that we would be all expelled and thus isolated. So be it. We, however, don't think that this will happen until . . . workplace militants had found a voice independent of the trade unions and so they become less useful to us anyway. Our aim is not to support social democracy, but to show it up as irrelevant to the working class." [Op. Cit., p. 19]

Whatever the merits and disadvantages of both approaches are, it seems likely that the activity of both will overlap in practice with Industrial Networks operating within trade union branches and "rank and file" groups providing alternative structures for struggle.

As noted above, there is a slight difference between anarcho-syndicalist supporters of Industrial Networks and communist-anarchist ones. This is to do with how they see the function and aim of these networks. In the short run, both agree that such networks should agitate in their industry and call mass assemblies to organise resistance to capitalist exploitation and oppression. They disagree on who can join the network groups and what their medium term aims should be. Anarcho-syndicalists aim for the Industrial Networks to be the focal point for the building of permanent syndicalist unions and so aim for the Industrial Networks to be open to all workers who accept the general aims of the organisation. Anarcho-communists, however, view Industrial Networks as a means of increasing anarchist ideas within the working class and are not primarily concerned about building syndicalist unions (while many anarcho-communists would support such a development, some do not). In the long term, they both aim for social revolution and workers' self-management of production.

These anarchists, therefore, see the need for workplace-based branches of an anarchist group along with the need for networks of militant 'rank and file' workers, but reject the idea of something that is one but pretends to be the other. They argue that, far from avoiding the problems of classical anarcho-syndicalism, such networks seem to emphasise one of the worst problems -- namely that of how the organisation remains anarchist but is open to non-anarchists. However, the similarities between the two positions are greater than the differences and so can be summarised together, as we have done here.

## J.5.5 What forms of co-operative credit do anarchists support?

Anarchists tend to support must forms of co-operation, including those associated with credit and money. This co-operative banking takes many forms, such as credit unions, LETS schemes and so on. In this section we discuss two main forms of co-operative credit, mutualism and LETS.

Mutualism is the name for the ideas associated with Proudhon and his Bank of the People. Essentially, it is a confederation of credit unions in which working class people pool their funds and savings so allowing credit to be supplied at cost (no interest), so increasing the options available to them. LETS stands for Local Exchange Trading Schemes and is a similar idea in many ways (see Bringing the Economy Home from the Market by Ross V.G. Dobson on LETS). From its start in Canada, LETS has spread across the world and there are now hundreds of schemes involving hundreds of thousands of people.

Both schemes revolve around creating an alternative form of currency and credit within capitalism in order to allow working class people to work outwith the capitalist money system by creating a new circulating medium. In this way, it is hoped, workers would be able to improve their living and working conditions by having a source of community-based (very low interest) credit and so be less dependent on capitalists and the capitalist banking system. Supporters of mutualism considered it as the ideal way of reforming capitalism away for by making credit available to the ordinary worker at very cheap rates, the end of wage slavery could occur as workers would work for themselves by either purchasing the necessary tools required for their work or by buying the capitalists out.

Mutual credit, in short, is a form of credit co-operation, in which individuals pull their resources together in order to benefit themselves as individuals and as part of a community. It has the following key aspects:

> -- Co-operation: No-one owns the network. It is controlled by its members democratically.

> -- Non-exploitative: No interest is charged on account balances or credit. At most administrative costs are charged, a result of it being commonly owned and managed.

> -- Consent: Nothing happens without it, there is no compulsion to trade.

> -- Labour-Notes: They use their own type of money as a means of aiding "honest exchange."

It is hoped, by organising credit, working class people will be able to work for themselves and slowly but surely replace capitalism with a co-operative system based upon self-management. While LETS schemes do not have such grand schemes, historically mutualism aimed at working within and transforming capitalism to socialism. At the very least, LETS schemes reduce the power and influence of banks and finance capital within society as mutualism ensures that working people have a viable alternative to such parasites.

These ideas have had a long history within the socialist movement, originating in Britain in the early 19th century when Robert Owen and other Socialists raised the idea of labour notes and labour-exchanges as both a means of improving working class conditions within capitalism and of reforming capitalism into a society of confederated, self-governing communities. Such "Equitable Labour Exchanges" were "founded at London and Birmingham in 1832" with "Labour notes and the exchange of small products." [E. P. Thompson, The Making of the English Working Class, p. 870] Apparently independently of these attempts in Britain at what would later be called mutualism, Proudhon arrived at the same ideas decades later in France: "The People's Bank quite simply embodies the financial and economic aspects of the principle of modern democracy, that is, the sovereignty of the People, and of the republican motto, 'Liberty, Equality, Fraternity.'" [Selected Writings of P-J Proudhon, p. 75] Similarly, in the USA (partly as a result of Joshua Warren's activities, who got the idea from Robert Owen) there was extensive discussion on labour notes, exchanges and free credit as a means of protecting workers from the evils of capitalism and ensuring their independence and freedom from wage slavery. When Proudhon's works appeared in North America, the basic arguments were well known and they were quickly adopted by radicals there.

Therefore the idea that mutual banking using labour money as a means to improve working class living conditions, even, perhaps, to achieve industrial democracy, self-management and the end of capitalism has a long history in Socialist thought. Unfortunately this aspect of socialism became less important with the rise of Marxism (which called these early socialists "utopian"). Attempts at such credit unions and alternative exchange schemes were generally replaced with attempts to build working class political parties and so constructive socialistic experiments and collective working class self-help was replaced by working within the capitalist state. Fortunately, history has had the last laugh on Marxism with working class people yet again creating anew the ideas of mutualism (as can be seen by the growth of LETS and other schemes of community money).

## J.5.6 Why are mutual credit schemes important?

Mutual credit schemes are important because they are a way to improve working class life under capitalism and ensure that what money we do have is used to benefit ourselves rather than the elite. By organising credit, we retain control over it and so rather than being used to invest in capitalist schemes it can be used for socialist alternatives.

For example, rather than allow the poorest to be at the mercy of loan sharks a community, by organising credit, can ensure its members receive cheap credit. Rather than give capitalist banks bundles of cash to invest in capitalist firms seeking to extract profits from a locality, it can be used to fund a co-operative instead. Rather than invest pension schemes into the stock market and so help undermine workers pay and living standards by increasing rentier power, it can be used to invest in schemes to improve the community and its economy. In short, rather than bolster capitalist power and so control, mutual credit aims to undermine the power of capitalist banks and finance by placing as much money as much possible in working class hands.

This point is important, as the banking system is often considered "neutral" (particularly in capitalist economics). However, as Malatesta correctly argued, it would be "a mistake to believe . . . that the banks are, or are in the main, a means to facilitate exchange; they are a means to speculate on exchange and currencies, to invest capital and to make it produce interest, and to fulfil other typically capitalist operations." [Errico Malatesta: His Life and Ideas, p. 100] Within capitalism, money is still to a large degree a commodity which is more than a convenient measure of work done in the production of goods and services. It can and does go anywhere in the world where it can get the best return for its owners, and so it tends to drain out of those communities that need it most (why else would a large company invest in a community unless the money it takes out of the area handsomely exceeds that put it?). It is the means by which capitalists can buy the liberty of working people and get them to produce a surplus for them (wealth is, after all, "a power invested in certain individuals by the institutions of society, to compel others to labour for their benefit." [William Godwin, The Anarchist Writings of William Godwin, p. 130]). From this consideration alone, working class control of credit and money is an important part of the class struggle as having access to alternative sources of credit can increase working class options and power.

As we discussed in section B.3.2, credit is also an important form of social control -- people who have to pay their mortgage or visa bill are more pliable, less likely to strike or make other forms of political trouble. Credit also expands the consumption of the masses in the face of stagnant or falling wages so blunting the impact of increasing exploitation. Moreover, as an added bonus, there is a profit to be made as the "rich need a place to earn interest on their surplus funds, and the rest of the population makes a juicy lending target." [Doug Henwood, Wall Street, p. 65]

Little wonder that the state (and the capitalists who run it) is so concerned to keep control of money in its own hands or the hands of its agents. With an increase in mutual credit, interest rates would drop, wealth would stay more in working class communities, and the social power of working people would increase (for people would be more likely to struggle for higher wages and better conditions -- as the fear of debt repayments would be less). By the creation of community-based credit unions that do not put their money into "Capital Markets" or into capitalist Banks working class people can control their own credit, their own retirement funds, and find ways of using money as a means of undermining capitalist power and supporting social struggle and change. In this way working people are controlling more and more of the money supply and using it in ways that will stop capital from using it to oppress and exploit them.

An example of why this can be important can be seen from the existing workers' pension fund system which is invested in the stock market in the hope that workers will receive an adequate pension in their old age. However, the only people actually winning are bankers and big companies. Unsurprisingly, the managers of these pension fund companies are investing in those firms with the highest returns, which are usually those who are downsizing or extracting most surplus value from their workforce (which in turn forces other companies to follow the same strategies to get access to the available funds in order to survive). Basically, if your money is used to downsize your fellow workers or increase the power of capital, then you are not only helping to make things harder for others like you, you are also helping making things worse for yourself. No person is an island, and increasing the clout of capital over the working class is going to affect you directly or indirectly. As such, the whole scheme is counter-productive as it effectively means workers have to experience insecurity, fear of downsizing and stagnating wages during their working lives in order to have slightly more money when they retire (assuming that they are fortunate enough to retire when the stock market is doing well rather than during one of its regular periods of financial instability, of course).

This highlights one of the tricks the capitalists are using against us, namely to get us to buy into the system through our fear of old age. Whether it is going into lifelong debt to buy a home or putting our money in the stock market, we are being encouraged to buy into the system which exploits us and so put its interests above our own. This makes us more easily controlled. We need to get away from living in fear and stop allowing ourselves to be deceived into behaving like "stakeholders" in a Plutocratic system where most shares really are held by an elite. As can be seen from the use of pension funds to buy out firms, increase the size of transnationals and downsize the workforce, such "stakeholding" amounts to sacrificing both the present and the future while others benefit.

The real enemies are not working people who take part in such pension schemes. It is the people in power, those who manage the pension schemes and companies, who are trying to squeeze every last penny out of working people to finance higher profits and stock prices -- which the unemployment and impoverishment of workers on a world-wide scale aids. They control the governments of the world. They are making the "rules" of the current system. Hence the importance of limiting the money they have available, of creating community-based credit unions and mutual risk insurance co-operatives to increase our control over our money which can be used to empower ourselves, aid our struggles and create our own alternatives (see section B.3.2 for more anarchist views on mutual credit and its uses). Money, representing as it does the power of capital and the authority of the boss, is not "neutral" and control over it plays a role in the class struggle. We ignore such issues at our own peril.

## J.5.7 Do most anarchists think mutual credit is sufficient to abolish capitalism?

The short answer is no, they do not. While the Individualist and Mutualist Anarchists do think that mutual banking is the only sure way of abolishing capitalism, most anarchists do not see it as an end in itself. Few think that capitalism can be reformed away in the manner assumed by Proudhon or Tucker.

In terms of the latter, increased access to credit does not address the relations of production and market power which exist within the economy and so any move for financial transformation has to be part of a broader attack on all forms of capitalist social power in order to be both useful and effective. In short, assuming that Individualist Anarchists do manage to organise a mutual banking scheme it cannot be assumed that as long as firms use wage-labour that any spurt in economic activity will have a long term effect of eliminating exploitation. What is more likely is that an economic crisis would develop as lowering unemployment results in a profits squeeze (as occurred in, say, the 1970s). Without a transformation in the relations of production, the net effect would be the usual capitalist business cycle.

For the former, for mutualists like Proudhon, mutual credit was seen as a means of transforming the relations of production (as discussed in section G.4.1, unlike Proudhon, Tucker did not oppose wage-labour and just sought to make it non-exploitative). For Proudhon, mutual credit was seen as the means by which co-operatives could be created to end wage-labour. The organisation of labour would combine with the organisation of credit to end capitalism as workers would fund co-operative firms and their higher efficiency would soon drive capitalist firms out of business. Thus "the Exchange Bank is the organisation of labour's greatest asset” as it allowed "the new form of society to be defined and created among the workers." [Proudhon, Correspondance, vol. 2, pp. 307-8] "To organise credit and circulation is to increase production," Proudhon stressed, "to determine the new shapes of industrial society." [Op. Cit., vol. 6, p. 372] So, overtime, co-operative credit would produce co-operative production while associated labour would increase the funds available to associated credit. For Proudhon the "organisation of credit and organisation of labour amount to one and the same" and by recognising this the workers "would soon have wrested alienated capital back again, through their organisation and competition." [No Gods, No Masters, vol. 1, pp. 59-60]

Bakunin, while he was "convinced that the co-operative will be the preponderant form of social organisation in the future" and could "hardly oppose the creation of co-operatives associations" now as we find them necessary in many respects," argued that Proudhon’s hope for gradual change by means of mutual banking and the higher efficiency of workers’ co-operatives were unlikely to be realised. This was because such claims "do not take into account the vast advantage that the bourgeoisie enjoys against the proletariat through its monopoly on wealth, science, and secular custom, as well as through the approval -- overt or covert but always active -- of States and through the whole organisation of modern society. The fight is too unequal for success reasonably to be expected." [The Basic Bakunin, p. 153 and p. 152] Thus capitalism "does not fear the competition of workers' associations -- neither consumers', producers', nor mutual credit associations -- for the simple reason that workers' organisations, left to their own resources, will never be able to accumulate sufficiently strong aggregations of capital capable of waging an effective struggle against bourgeois capital." [The Political Philosophy of Bakunin, p. 293]

So, for most anarchists, it is only in combination with other forms of working class self-activity and self-management that mutualist institutions could play an important role in the class struggle. In other words, few anarchists think that mutualist credit or co-operatives are enough in themselves to end capitalism. Revolutionary action is also required -- such as the expropriation of capital by workers associations.

This does not mean anarchists reject co-operation under capitalism. By creating a network of mutual banks to aid in creating co-operatives, union organising drives, supporting strikes (either directly by gifts/loans or funding consumer co-operatives which could supply food and other essentials free or at a reduced cost), mutualism can be used as a means of helping build libertarian alternatives within the capitalist system. Such alternatives, while making life better under the current system, also play a role in overcoming that system by aiding those in struggle. Thus Bakunin:

> "let us co-operate in our common enterprise to make our lives a little bit more supportable and less difficult. Let us, wherever possible, establish producer-consumer co-operatives and mutual credit societies which, though under the present economic conditions they cannot in any real or adequate way free us, are nevertheless important inasmuch they train the workers in the practices of managing the economy and plant the precious seeds for the organisation of the future." [Bakunin on Anarchism, p. 173]

So while few anarchists think that mutualism would be enough in itself, it can play a role in the class struggle. As a compliment to direct action and workplace and community struggle and organisation, mutualism has an important role in working class self-liberation. For example, community unions (see section J.5.1) could create their own mutual banks and money which could be used to fund co-operatives and support social struggle. In this way a healthy communalised co-operative sector could develop within capitalism, overcoming the problems of isolation facing workplace co-operatives (see section J.5.11) as well as providing solidarity for those in struggle.

Mutual banking can be a way of building upon and strengthening the anarchistic social relations within capitalism. For even under capitalism and statism, there exists extensive mutual aid and, indeed, anarchistic and communistic ways of living. For example, communistic arrangements exist within families, between friends and lovers and within anarchist organisations. Mutual credit could be a means of creating a bridge between this alternative (gift) "economy" and capitalism. The mutualist alternative economy would help strength communities and bonds of trust between individuals, and this would increase the scope of the communistic sector as more and more people help each other without the medium of exchange. In other words, mutualism will help the gift economy that exists within capitalism to grow and develop.

## J.5.8 What would a modern system of mutual banking look like?

One scenario for an updated system of mutual banking would be for a community to begin issuing an alternative currency accepted as money by all individuals within it. Let us call this currency-issuing association a "mutual barter clearinghouse," or just "clearinghouse" for short.

The clearinghouse would have a twofold mandate: first, to extend credit at cost to members; second, to manage the circulation of credit-money within the system, charging only a small service fee (one percent or less) sufficient to cover its costs of operation, including labour costs involved in issuing credit and keeping track of transactions, insuring itself against losses from uncollectable debts, and so forth. Some current experiments in community money use labour time worked as their basis (thus notes would be marked one-hour) while others have notes tied to the value of the state currency (thus, say, a Scottish town would issue pounds assumed to be the same as a British pound note).

The clearinghouse would be organised and function as follows. People could join the clearinghouse by pledging a certain amount of property (including savings) as collateral. On the basis of this pledge, an account would be opened for the new member and credited with a sum of mutual pounds equivalent to some fraction of the assessed value of the property pledged. The new member would agree to repay this amount plus the service fee into their account by a certain date. The mutual pounds could then be transferred through the clearinghouse to the accounts of other members, who have agreed to receive mutual money in payment for all debts or work done.

The opening of this sort of account is, of course, the same as taking out a "loan" in the sense that a commercial bank "lends" by extending credit to a borrower in return for a signed note pledging a certain amount of property as security. The crucial difference is that the clearinghouse does not purport to be "lending" a sum of money that it already has, as is fraudulently claimed by commercial banks. Instead it honestly admits that it is creating new money in the form of credit. New accounts can also be opened simply by telling the clearinghouse that one wants an account and then arranging with other people who already have balances to transfer mutual money into one's account in exchange for goods or services.

Another form of mutual credit are LETS systems. In this a number of people get together to form an association. They create a unit of exchange (which is equal in value to a unit of the national currency usually), choose a name for it and offer each other goods and services priced in these units. These offers and wants are listed in a directory which is circulated periodically to members. Members decide who they wish to trade with and how much trading they wish to do. When a transaction is completed, this is acknowledged with a "cheque" made out by the buyer and given to the seller. These are passed on to the system accounts administration which keeps a record of all transactions and periodically sends members a statement of their accounts. The accounts administration is elected by, and accountable to, the membership and information about balances is available to all members.

Unlike the first system described, members do not have to present property as collateral. Members of a LETS scheme can go into "debt" without it, although "debt" is the wrong word as members are not so much going into debt as committing themselves to do some work within the system in the future and by so doing they are creating spending power. The willingness of members to incur such a commitment could be described as a service to the community as others are free to use the units so created to trade themselves. Indeed, the number of units in existence exactly matches the amount of real wealth being exchanged. The system only works if members are willing to spend. It runs on trust and builds up trust as the system is used.

It is likely that a fully functioning mutual banking system would incorporate aspects of both these systems. The need for collateral may be used when members require very large loans while the LETS system of negative credit as a commitment to future work would be the normal function of the system. If the mutual bank agrees a maximum limit for negative balances, it may agree to take collateral for transactions that exceed this limit. However, it is obvious that any mutual banking system will find the best means of working in the circumstances it finds itself.

## J.5.9 How does mutual credit work?

Let us consider an example of how business would be transacted using mutual credit within capitalism. There are two possibilities, depending on whether the mutual credit is based upon whether the creditor can provide collateral or not. We will take the case with collateral first.

Suppose that A, an organic farmer, pledges as collateral a certain plot of land that she owns and on which she wishes to build a house. The land is valued at, say, £40,000 in the capitalist market and by pledging the land, A is able to open a credit account at the clearinghouse for, say, £30,000 in mutual money. She does so knowing that there are many other members of the system who are carpenters, electricians, plumbers, hardware suppliers, and so on who are willing to accept mutual pounds in payment for their products or services.

It is easy to see why other subscriber-members, who have also obtained mutual credit and are therefore in debt to the clearinghouse, would be willing to accept such notes in return for their goods and services. They need to collect mutual currency to repay their debts. Why would someone who is not in debt for mutual currency be willing to accept it as money?

To see why, let us suppose that B, an underemployed carpenter, currently has no account at the clearinghouse but that he knows about it and the people who operate and use it. After examining its list of members and becoming familiar with the policies of the new organisation, he is convinced that it does not extend credit frivolously to untrustworthy recipients who are likely to default. He also knows that if he contracts to do the carpentry on A's new house and agrees to be paid for his work in mutual money, he will then be able to use it to buy groceries, clothes, and other goods and services from various people in the community who already belong to the system.

Thus B will be willing, and perhaps even eager (especially if the economy is in recession and regular money is tight) to work for A and receive payment in mutual credit. For he knows that if he is paid, say, £8,000 in mutual money for his labour on A's house, this payment constitutes, in effect, 20 percent of a mortgage on her land, the value of which is represented by her mutual credit. B also understands that A has promised to repay this mortgage by producing new value -- that is, by growing organic fruits and vegetables and selling them to other members of the system -- and that it is this promise to produce new wealth which gives her mutual credit its value as a medium of exchange.

To put this point slightly differently, A's mutual credit can be thought of as a lien against goods or services which she will create in the future. As security of this guarantee, she agrees that if she is unable for some reason to fulfil her obligation, the land she has pledged will be sold to other members. In this way, a value sufficient to cancel her debt (and probably then some) will be returned to the system. This provision insures that the clearinghouse is able to balance its books and gives members confidence that mutual money is sound.

It should be noticed that since new wealth is continually being created, the basis for new mutual credit is also being created at the same time. Thus, suppose that after A's new house has been built, her daughter, C, along with a group of friends D, E, F, . . . , decide that they want to start a co-operative restaurant but that C and her friends do not have enough collateral to obtain a start-up loan. A, however, is willing to co-sign a note for them, pledging her new house (valued at say, £80,000) as security. On this basis, C and her partners are able to obtain £60,000 worth of mutual credit, which they then use to buy equipment, supplies, furniture, advertising, etc. to start their restaurant.

This example illustrates one way in which people without property are able to obtain credit in the new system. Another way -- for those who cannot find (or perhaps do not wish to ask) someone with property to co-sign for them -- is to make a down payment and then use the property which is to be purchased on credit as security, as in the current method of obtaining a home or other loan. With mutual credit, however, this form of financing can be used to purchase anything, including the means of production and other equipment required for workers to work for themselves instead of a boss.

Which brings us to the case of an individual without means for providing collateral -- say, for example Z, a plumber, who currently does not own the land she uses. In such a case, Z, who still desires work done, would contact other members of the mutual bank with the skills she requires. Those members with the appropriate skills and who agree to work with her commit themselves to do the required tasks. In return, Z gives them a check in mutual dollars which is credited to their account and deducted from hers. She does not pay interest on this issue of credit and the sum only represents her willingness to do some work for other members of the bank at some future date.

The mutual bank does not have to worry about the negative balance, as this does not create a loss within the group as the minuses which have been incurred have already created wealth (pluses) within the system and it stays there. It is likely, of course, that the mutual bank would agree an upper limit on negative balances and require some form of collateral for credit greater than this limit, but for most exchanges this would be unlikely to be relevant.

It is important to remember that mutual money has no intrinsic value, since they cannot be redeemed (at the mutual bank) in gold or anything else. All they are promises of future labour. They are a mere medium for the facilitation of exchange used to facilitate the increase production of goods and services (as discussed in section G.3.6, it is this increase which ensures that mutual credit is not inflationary). This also ensures enough work for all and, ultimately, the end of exploitation as working people can buy their own means of production and so end wage-labour by self-employment and co-operation.

For more information on how mutual banking is seen to work see the collection of Proudhon's works collected in Proudhon's Solution to the Social Problem. William B. Greene's Mutual Baking and Benjamin Tucker's Instead of a Book should also be consulted.

## J.5.10 Why do anarchists support co-operatives?

Support for co-operatives is a common feature in anarchist writings. In fact, support for democratic workplaces is as old as use of the term anarchist to describe our ideas. So why do anarchists support co-operatives? It is because they are the only way to guarantee freedom in production and so "the co-operative system . . . carries within it the germ of the future economic order." [Bakunin, The Philosophy of Bakunin, p. 385]

Anarchists support all kinds of co-operatives: housing, food, consumer, credit and workplace ones. All forms of co-operation are useful as they accustom their members to work together for their common benefit as well as ensuring extensive experience in managing their own affairs. As such, all forms of co-operatives are (to some degree) useful examples of self-management and anarchy in action. Here we will concentrate on producer co-operatives as only these can replace the capitalist mode of production. They are examples of a new mode of production, one based upon associated, not wage, labour. As long as wage-labour exists within industry and agriculture then capitalism remains and no amount of other kinds of co-operatives will end it. If wage slavery exists, then so will exploitation and oppression and anarchy will remain but a hope.

Co-operatives are the "germ of the future" for two reasons. Firstly, co-operatives are based on one worker, one vote. In other words those who do the work manage the workplace within which they do it (i.e. they are based on workers' self-management). Thus co-operatives are an example of the "horizontal" directly democratic organisation that anarchists support and so are an example of "anarchy in action" (even if in an imperfect way) within capitalism. Secondly, they are an example of working class self-help and self-activity. Instead of relying on others to provide work, co-operatives show that production can be carried on without the existence of a class of masters employing a class of order takers.

Workplace co-operatives also present evidence of the viability of an anarchist economy. It is well established that co-operatives are usually more productive and efficient than their capitalist equivalents. This indicates that hierarchical workplaces are not required in order to produce useful goods and indeed can be harmful. It also indicates that the capitalist market does not actually allocate resources efficiently nor has any tendency to do so.

So why should co-operatives be more efficient? Firstly, there are the positive effects of increased liberty. Co-operatives, by abolishing wage slavery, obviously increase the liberty of those who work in them. Members take an active part in the management of their working lives and so authoritarian social relations are replaced by libertarian ones. Unsurprisingly, this liberty also leads to an increase in productivity -- just as wage labour is more productive than slavery, so associated labour is more productive than wage slavery. As Kropotkin argued: "the only guarantee not to be robbed of the fruits of your labour is to possess the instruments of labour . . . man really produces most when he works in freedom, when he has a certain choice in his occupations, when he has no overseer to impede him, and lastly, when he sees his work bringing profit to him and to others who work like him, but bringing in little to idlers." [The Conquest of Bread, p. 145]

There are also the positive advantages associated with participation (i.e. self-management, liberty in other words). Within a self-managed, co-operative workplace, workers are directly involved in decision making and so these decisions are enriched by the skills, experiences and ideas of all members of the workplace. In the words of Colin Ward:

> "You can be in authority, or you can be an authority, or you can have authority. The first derives from your rank in some chain of command, the second derives special knowledge, and the third from special wisdom. But knowledge and wisdom are not distributed in order of rank, and they are no one person's monopoly in any undertaking. The fantastic inefficiency of any hierarchical organisation -- any factory, office, university, warehouse or hospital -- is the outcome of two almost invariable characteristics. One is that the knowledge and wisdom of the people at the bottom of the pyramid finds no place in the decision-making leadership hierarchy of the institution. Frequently it is devoted to making the institution work in spite of the formal leadership structure, or alternatively to sabotaging the ostensible function of the institution, because it is none of their choosing. The other is that they would rather not be there anyway: they are there through economic necessity rather than through identification with a common task which throws up its own shifting and functional leadership.

> "Perhaps the greatest crime of the industrial system is the way it systematically thwarts the investing genius of the majority of its workers." [Anarchy in Action, p. 41]

Also, as workers also own their place of work, they have an interest in developing the skills and abilities of their members and, obviously, this also means that there are few conflicts within the workplace. Unlike capitalist firms, there is no conflict between bosses and wage slaves over work loads, conditions or the division of value created between them. All these factors will increase the quality, quantity and efficiency of work, increase efficient utilisation of available resources and aids the introduction of new techniques and technologies.

Secondly, the increased efficiency of co-operatives results from the benefits associated with co-operation itself. Not only does co-operation increase the pool of knowledge and abilities available within the workplace and enriches that source by communication and interaction, it also ensures that the workforce are working together instead of competing and so wasting time and energy. As Alfie Kohn notes (in relation to investigations of in-firm co-operation):

> "Dean Tjosvold . . . conducted [studies] at utility companies, manufacturing plants, engineering firms, and many other kinds of organisations. Over and over again, Tjosvold has found that 'co-operation makes a work force motivated' whereas 'serious competition undermines co-ordination' . . . Meanwhile, the management guru . . . T. Edwards Demming, has declared that the practice of having employees compete against each other is 'unfair [and] destructive. We cannot afford this nonsense any longer . . . [We need to] work together on company problems [but] annual rating of performance, incentive pay, [or] bonuses cannot live with team work . . . What takes the joy out of learning . . . [or out of] anything? Trying to be number one.'" [No Contest, p. 240]

Thirdly, there are the benefits associated with increased equality. Studies prove that business performance deteriorates when pay differentials become excessive. In a study of over 100 businesses (producing everything from kitchen appliances to truck axles), researchers found that the greater the wage gap between managers and workers, the lower their product's quality. [Douglas Cowherd and David Levine, "Product Quality and Pay Equity," Administrative Science Quarterly, No. 37, pp. 302-30] Businesses with the greatest inequality were plagued with a high employee turnover rate. Study author David Levine said: "These organisations weren't able to sustain a workplace of people with shared goals." [quoted by John Byrne, "How high can CEO pay go?" Business Week, April 22, 1996] The negative effects of income inequality can also be seen on a national level as well. Economists Torsten Persson and Guido Tabellini conducted a thorough statistical analysis of historical inequality and growth, and found that nations with more equal incomes generally experience faster productive growth. ["Is Inequality Harmful for Growth?", American Economic Review no. 84, pp. 600-21] Numerous other studies have also confirmed their findings (the negative impacts on inequality on all aspects of life are summarised by Richard Wilkinson and Kate Pickett in The Spirit Level: Why More Equal Societies Almost Always Do Better). Real life yet again disproves the assumptions of capitalism: inequality harms us all, even the capitalist economy which produces it.

This is to be expected. Workers, seeing an increasing amount of the value they create being monopolised by top managers and a wealthy elite and not re-invested into the company to secure their employment prospects, will hardly be inclined to put in that extra effort or care about the quality of their work. Bosses who use the threat of unemployment to extract more effort from their workforce are creating a false economy. While they will postpone decreasing profits in the short term due to this adaptive strategy (and enrich themselves in the process) the pressures placed upon the system will bring harsh long term effects -- both in terms of economic crisis (as income becomes so skewed as to create realisation problems and the limits of adaptation are reached in the face of international competition) and social breakdown.

As would be imagined, co-operative workplaces tend to be more egalitarian than capitalist ones. This is because in capitalist firms, the incomes of top management must be justified (in practice) to a small number of individuals (namely, those shareholders with sizeable stock in the firm), who are usually quite wealthy and so not only have little to lose in granting huge salaries but are also predisposed to see top managers as being very much like themselves and so are entitled to comparable incomes (and let us not forget that "corporate boards, largely selected by the CEO, hire compensation experts, almost always chosen by the CEO, to determine how much the CEO is worth." [Paul Krugman, The Conscience of a Liberal, p. 144]). In contrast, the incomes of management in worker controlled firms have to be justified to a workforce whose members experience the relationship between management incomes and their own directly and who, no doubt, are predisposed to see their elected managers as being workers like themselves and accountable to them. Such an egalitarian atmosphere will have a positive impact on production and efficiency as workers will see that the value they create is not being accumulated by others but distributed according to work actually done (and not control over power). In the Mondragon co-operatives, for example, the maximum pay differential is 9 to 1 (increased from 3 to 1 after much debate in a response to outside pressures from capitalist firms hiring away workers) while (in the USA) the average CEO is paid well over 100 times the average worker (up from 41 times in 1960).

Therefore, we see that co-operatives prove the advantages of (and the inter-relationship between) key anarchist principles such as liberty, equality, solidarity and self-management. Their application, whether all together or in part, has a positive impact on efficiency and work -- and, as we will discuss in section J.5.12, the capitalist market actively blocks the spread of these more egalitarian and efficient productive techniques instead of encouraging them. Even by its own standards, capitalism stands condemned -- it does not encourage the efficient use of resources and actively places barriers in their development.

From all this it is clear to see why co-operatives are supported by anarchists. We are "convinced that the co-operative could, potentially, replace capitalism and carries within it the seeds of economic emancipation . . . The workers learn from this precious experience how to organise and themselves conduct the economy without guardian angels, the state or their former employers." [Bakunin, Bakunin on Anarchism, p. 399] Co-operatives give us a useful insight into the possibilities of a free, socialist, economy. Even within the hierarchical capitalist economy, co-operatives show us that a better future is possible and that production can be organised in a co-operative fashion and that by so doing we can reap the individual and social benefits of working together as equals.

However, this does not mean that all aspects of the co-operative movement find favour with anarchists. As Bakunin pointed out, "there are two kinds of co-operative: bourgeois co-operation, which tends to create a privileged class, a sort of new collective bourgeoisie organised into a stockholding society: and truly Socialist co-operation, the co-operation of the future which for this very reason is virtually impossible of realisation at present." [Op. Cit., p. 385] In other words, while co-operatives are the germ of the future, in the present they are often limited by the capitalist environment they find themselves, narrow their vision to just surviving within the current system and so adapt to it.

For most anarchists, the experience of co-operatives has proven without doubt that, however excellent in principle and useful in practice, if they are kept within capitalism they cannot become the dominant mode of production and free the masses (see section J.5.11). In order to fully develop, co-operatives must be part of a wider social movement which includes community and industrial unionism and the creation of a anarchistic social framework which can encourage "truly Socialist co-operation" and discourage "bourgeois co-operation." As Murray Bookchin correctly argued: "Removed from a libertarian municipalist [or other anarchist] context and movement focused on achieving revolutionary municipalist goals as a dual power against corporations and the state, food [and other forms of] co-ops are little more than benign enterprises that capitalism and the state can easily tolerate with no fear of challenge." [Democracy and Nature, no. 9, p. 175]

So while co-operatives are an important aspect of anarchist ideas and practice, they are not the be all or end all of our activity. Without a wider social movement which creates all (or at least most) of the future society in the shell of the old, co-operatives will never arrest the growth of capitalism or transcend the narrow horizons of the capitalist economy.

## J.5.11 If workers really want self-management then why are there so few co-operatives?

Supporters of capitalism suggest that producer co-operatives would spring up spontaneously if workers really wanted them. To quote leading propertarian Robert Nozick, under capitalism "it is open to any wealthy radical or group of workers to buy an existing factory or establish a new one, and to . . . institute worker-controlled, democratically-run firms." If "they are superior, by market standards, to their more orthodox competitors" then "there should be little difficulty in establishing successful factories of this sort." Thus there is "a means of realising the worker-control scheme that can be brought about by the voluntary actions of people in a free [sic!] society." [Anarchy, State, and Utopia, pp. 250-2] So if such co-operatives were really economically viable and desired by workers, they would spread until eventually they undermined capitalism. Propertarians conclude that since this is not happening, it must be because workers' self-management is either economically inefficient or is not really attractive to workers, or both.

David Schweickart has decisively answered this argument by showing that the reason there are not more producer co-operatives is structural:

> "A worker-managed firm lacks an expansionary dynamic. When a capitalist enterprise is successful, the owner can increase her profits by reproducing her organisation on a larger scale. She lacks neither the means nor the motivation to expand. Not so with a worker-managed firm. Even if the workers have the means, they lack the incentive, because enterprise growth would bring in new workers with whom the increased proceeds would have to be shared. Co-operatives, even when prosperous, do not spontaneously grow. But if this is so, then each new co-operative venture (in a capitalist society) requires a new wealthy radical or a new group of affluent radical workers willing to experiment. Because such people doubtless are in short supply, it follows that the absence of a large and growing co-operative movement proves nothing about the viability of worker self-management, nor about the preferences of workers." [Against Capitalism, p. 239]

This means that in, say, a mutualist economy there would be more firms of a smaller size supplying a given market compared to capitalism. So a free economy, with the appropriate institutional framework, need not worry about unemployment for while individual co-operatives may not expand as fast as capitalist firms, more co-operatives would be set up (see section I.3.1 for why the neo-classical analysis of co-operatives which Nozick implicitly invokes is false). In short, the environment within which a specific workplace operates is just as important as its efficiency.

This is important, as the empirical evidence is strong that self-management is more efficient than wage-slavery. As economist Geoffrey M. Hodgson summarises, support for "the proposition that participatory and co-operatives firms enjoy greater productivity and longevity comes from a large amount of . . . case study and econometric evidence" and "the weight of testimony" is "in favour or [indicates] a positive correlation between participation and productivity." ["Organizational Form and Economic Evolution: A critique of the Williamsonian hypothesis", pp. 98-115, Democracy and Efficiency in Economic Enterprises, U. Pagano and R. E. Rowthorn (eds.), p. 100] This is ignored by the likes of Nozick in favour of thought-experiments rooted in the dubious assumptions of bourgeois economics. He implicitly assumed that because most firms are hierarchical today then they must be more efficient. In short, Nozick abused economic selection arguments by simply assuming, without evidence, that the dominant form of organisation is, ipso facto, more efficient. In reality, this is not the case.

The question now becomes one of explaining why, if co-operation is more efficient than wage-slavery, does economic liberty not displace capitalism? The awkward fact is that individual efficiency is not the key to survival as such an argument "ignores the important point that the selection of the 'fitter' in evolution is not simply relative to the less successful but is dependent upon the general circumstances and environment in which selection takes place." Moreover, an organism survives because it birth rate exceeds its death rate. If more capitalist firms secure funding from capitalist banks then, obviously, it is more likely for them to secure dominance in the economy simply because there are more of them rather than because they are more efficient. As such, large numbers do not imply greater efficiency as the "rapid flow of new entrants of hierarchical form" may "swamp the less hierarchical firms even if other selection processes are working in favour of the latter." [Hodgson, Op. Cit., p. 100 and p. 103] Thus:

> "The degree of fitness of any organism can only be meaningfully considered in relation to its environment . . . the market may help to select firms that are fit for the market, but these surviving firms needn't be the most 'efficient' in some absolute sense. In fact, the specification of 'the market' as a selection process is incomplete because the market is only one institution of many needed to specify an environment." [Michael J. Everett and Alanson P. Minkler, "Evolution and organisational choice in nineteenth-century Britain", pp. 51-62, Cambridge Journal of Economics vol. 17, No. 1, p. 53]

As an obvious example there are the difficulties co-operatives can face in finding access to credit facilities required by them from capitalist banks and investors. As Tom Cahill notes, co-operatives in the nineteenth century "had the specific problem of . . . giving credit" while "competition with price cutting capitalist firms . . . highlighting the inadequate reservoirs of the under-financed co-ops." ["Co-operatives and Anarchism: A contemporary Perspective", pp 235-58, For Anarchism, Paul Goodway (ed.), p. 239] This points to a general issue, namely that there are often difficulties for co-operatives in raising money:

> "Co-operatives in a capitalist environment are likely to have more difficulty in raising capital. Quite apart from ideological hostility (which may be significant), external investors will be reluctant to put their money into concerns over which they will have little or no control -- which tends to be the case with a co-operative. Because co-operatives in a capitalist environment face special difficulties, and because they lack the inherent expansionary dynamic of a capitalist firm, it is hardy surprising that they are far from dominant." [Schweickart, Op. Cit., p 240]

In addition, the "return on capital is limited" in co-operatives. [Tom Cahill, Op. Cit., p. 247] This means that investors are less-likely to invest in co-operatives, and so co-operatives will tend to suffer from a lack of investment. So despite "the potential efficiency of such [self-managed] workplaces", capitalism "may be systematically biased against participatory workplaces" and as "a result the economy can be trapped in a socially suboptimal position." Capital market issues, amongst others, help explain this as such firms "face higher transaction costs for raising equity and loans." [David I. Levine and Laura D'Andrea Tyson, "Participation, Productivity, and the Firm's Environment", pp. 183-237, Paying for Productivity, Alan S. Blinder (ed.), pp. 235-6 and p. 221]

Tom Cahill outlines the investment problem when he writes that the "financial problem" is a major reason why co-operatives failed in the past, for "basically the unusual structure and aims of co-operatives have always caused problems for the dominant sources of capital. In general, the finance environment has been hostile to the emergence of the co-operative spirit." He also notes that they were "unable to devise structuring to maintain a boundary between those who work and those who own or control . . . It is understood that when outside investors were allowed to have power within the co-op structure, co-ops lost their distinctive qualities." [Op. Cit., pp. 238-239] So even if co-operative do attract investors, the cost of so doing may be to transform the co-operatives into capitalist firms. So while all investors experience risk, this "is even more acute" in co-operatives "because investors must simultaneously cede control and risk their entire wealth. Under an unlimited liability rule, investors will rationally demand some control over the firm's operations to protect their wealth. Since [co-operatives] cannot cede control without violating one of the organisation's defining tenets, investors will demand an investment premium, a premium not required from equity investments." [Everett and Minkler, Op. Cit., p. 52] Needless to say, such a premium is a strain on a co-operative and makes it harder to survive simply because it has higher costs for debt repayment. If such external investment is not forthcoming, then the co-operative is dependent on retained earnings and its members' savings which, unsurprisingly, are often insufficient.

All of which suggests that Nozick's assertion that "don't say that its against the class interest of investors to support the growth of some enterprise that if successful would end or diminish the investment system. Investors are not so altruistic. They act in personal and not their class interests" is false. [Op. Cit., pp. 252-3] Nozick is correct, to a degree, but he forgets that class interest is a fusion of individual interests. Given a choice between returns from investments in capitalist firms because a management elite has similar interests in maximising unpaid labour and workers in a co-operative which controls any surplus, the investor will select the former. Moreover, lack of control by investors plays its role as they cannot simply replace the management in a co-operative -- that power lies in the hands of the workforce. The higher premiums required by investors to forsake such privileges place a burden on the co-operative, so reducing their likelihood of getting funds in the first place or surviving and, needless to say, increasing the risk that investors face. Thus the personal and class interest of investors merge, with the personal desire to make money ensuring that the class position of the individual is secured. This does not reflect the productivity or efficiency of the investment -- quite the reverse! -- it reflects the social function of wage labour in maximising profits and returns on capital (see next section for more on this). In other words, the personal interests of investors will generally support their class interests (unsurprisingly, as class interests are not independent of personal interests and will tend to reflect them!).

There are other structural problems as well. Co-operatives face the negative externalities generated by the capitalist economy they operate within. For one thing, since their pay levels are set by members' democratic vote, co-operatives tend to be more egalitarian in their income structure. This means that in a capitalist environment, co-operatives are in constant danger of having their most skilled members hired away by capitalist firms who can, due to their resources, out-bid the co-operative. While this may result in exploitation of the worker, the capitalist firm has the resources to pay higher wages and so it makes sense for them to leave ("As to the employer who pays an engineer twenty times more than a labourer, it is simply due to personal interest; if the engineer can economise $4000 a year on the cost of production; the employer pays him $800 . . . He parts with an extra $40 when he expects to gain $400 by it; and this is the essence of the Capitalist system." [Kropotkin, The Conquest of Bread, p. 165]). However, in a co-operative system there would not be the inequalities of economic wealth (created by capitalist firms and finance structures) which allows such poaching to happen.

There are cultural issues as well. As Jon Elster points out, it is a "truism, but an important one, that workers' preferences are to a large extent shaped by their economic environment. Specifically, there is a tendency to adaptive preference formation, by which the actual mode of economic organisation comes to be perceived as superior to all others." ["From Here to There", pp. 93-111, Socialism, Paul, Miller Jr., Paul, and Greenberg (eds.), p. 110] In other words, people view "what is" as given and feel no urge to change to "what could be." In the context of creating alternatives within capitalism, this can have serious effects on the spread of alternatives and indicates the importance of anarchists encouraging the spirit of revolt to break down this mental apathy.

This acceptance of "what is" can be seen, to some degree, by some companies which meet the formal conditions for co-operatives, for example ESOP owned firms in the USA, but lack effective workers' control. ESOP (Employee Stock Ownership Plans) enable a firm's workforce to gain the majority of a company's shares but the unequal distribution of shares amongst employees prevents the great majority of workers from having any effective control or influence on decisions. Unlike real co-operatives (based on "one worker, one vote") these firms are based on "one share, one vote" and so have more in common with capitalist firms than co-operatives.

Finally, there is the question of history, of path dependency. Path dependency is the term used to describe when the set of decisions one faces for any given circumstance is limited by the decisions made in the past, even though past circumstances may no longer be relevant. This is often associated with the economics of technological change in a society which depends quantitatively and/or qualitatively on its own past (the most noted example this is the QWERTY keyboard, which would not be in use today except that it happened to be chosen in the nineteenth century). Evolutionary systems are path dependent, with historical events pushing development in specific directions. Thus, if there were barriers against or encouragement for certain forms of organisational structure in the past then the legacy of this will continue to dominate due to the weight of history rather than automatically being replaced by new, more efficient, forms.

This can be seen from co-operatives, as "labour managed firms were originally at a substantial disadvantage compared to their capitalist counterparts" as the law "imposed additional risks and costs" on them while "early financial instruments were ill-suited to the establishment and continuation of worker co-operatives. The subsequent coevolution of firms and supporting institutions involved a path-dependent process where labour-managed firms were at a continual disadvantage, even after many of the earlier impediments were removed." [Hodgson, Op. Cit., p. 103] "Historically," argue Everett and Minkler "both company and co-operative law were incompatible with democratic decision-making by workers." The law ensured that the "burden was more costly" to labour-managed firms and these "obstacles led to an environment dominated by investor-controlled firms (capitalist firms) in which informal constraints (behaviours and routines) emerged to reinforce the existing institutions. A path-dependent process incorporating these informal constraints continued to exclude [their] widespread formation." When the formal constraints which prevented the formation of co-operatives were finally removed, the "informal constraints" produced as a result of these "continued to prevent the widespread formation" of co-operatives. So the lack of co-operatives "can thus be explained quite independently of any of the usual efficiency criteria." [Op. Cit., p. 58 and p. 60] Nor should we forget that the early industrial system was influenced by the state, particularly by rewarding war related contracts to hierarchical firms modelled on the military and that the state rewarded contracts to run various state services and industries to capitalist firms rather than, as Proudhon urged, to workers associations.

However, "there are several good reasons why more efficient firms need not always be selected in a competitive and 'evolutionary' process." [Hodgson, Op. Cit., p. 99] So it is not efficiency as such which explains the domination of capitalist firms for "empirical studies suggest that co-operatives are at least as productive as their capitalist counterparts," with many having "an excellent record, superior to conventionally organised firms over a long period." [Jon Elster, Op. Cit., p. 96] So all things being equal, co-operatives are more efficient than their capitalist counterparts -- but when co-operatives compete in a capitalist economy, all things are not equal. As David Schweickart argues:

> "Even if worker-managed firms are preferred by the vast majority, and even if they are more productive, a market initially dominated by capitalist firms may not select for them. The common-sense neo-classical dictum that only those things that best accord with people's desires will survive the struggle of free competition has never been the whole truth with respect to anything; with respect to workplace organisation it is barely a half-truth." [Op. Cit., p. 240]

It is illuminating, though, to consider why Nozick ignored the substantial empirical evidence that participation is more efficient than hierarchy and, as a result, why "market criteria" does not result in the more productive and efficient co-operative production displacing the authoritarian workplace. Far better, it must be supposed, to just assume that the dominant form of workplace is more "efficient" and implicitly invoke a quasi-Darwinian individualistic selection mechanism in an ahistorical and institution-less framework. So people like Nozick who suggest that because worker co-operatives are few in number that this means they are forced out by competition because they are inefficient miss the point. A key reason for this lack of co-operative firms, argues Hodgson, "is that competitive selection depends on the economic context, and while the institutional context of a capitalist system may be more conducive for the capitalist firm, a different context may favour the co-operative firm." [Economics and Utopia, p. 288]

As discussed in section I.3.5, Proudhon was well aware that for mutualism to prosper and survive an appropriate institutional framework was required (the "agro-industrial federation" and mutual banking). So an organisation's survival also depends on the co-evolution of supporting informal constraints. If a co-operative is isolated within a capitalist economy, without co-operative institutions around it, it comes as no great surprise to discover that they find it difficult to survive never mind displace its (usually larger and well-established) capitalist competitors.

Yet in spite of these structural problems and the impact of previous state interventions, co-operatives do exist under capitalism but just because they can survive in such a harsh environment it does not automatically mean that they shall replace that economy. Co-operatives face pressures to adjust to the dominant mode of production. The presence of wage labour and investment capital in the wider economy will tempt successful co-operatives to hire workers or issue shares to attract new investment. In so doing, however, they may end up losing their identities as co-operatives by diluting ownership (and so re-introducing exploitation by having to pay non-workers interest) or by making the co-operative someone's boss (which creates "a new class of workers who exploit and profit from the labour of their employees. And all this fosters a bourgeois mentality." [Bakunin, Bakunin on Anarchism, p. 399]).

Hence the pressures of working in a capitalist market may result in co-operatives pursuing activities which may result in short term gain or survival, but are sure to result in harm in the long run. Far from co-operatives slowly expanding within and changing a capitalist environment it is more likely that capitalist logic will expand into and change the co-operatives that work in it (this can be seen from the Mondragon co-operatives, where there has been a slight rise in the size of wage labour being used and the fact that the credit union has, since 1992, invested in non-co-operative firms). These externalities imposed upon isolated co-operatives within capitalism (which would not arise within a fully co-operative context) block local moves towards anarchism. The idea that co-operation will simply win out in competition within well developed capitalist economic systems is just wishful thinking. Just because a system is more liberatory, just and efficient does not mean it will survive or prosper in an authoritarian economic and social environment.

So both theory and history suggests that isolated co-operatives will more likely adapt to capitalist realities than remain completely true to their co-operative promise. For most anarchists, therefore, co-operatives can reach their full potential only as part of a social movement aiming to change society. Only as part of a wider movement of community and workplace unionism, with mutualist banks to provide long terms financial support and commitment, can co-operatives be communalised into a network of solidarity and support that will reduce the problems of isolation and adaptation. Hence Bakunin:

> "We want co-operation too . . . But at the same time, we know that it prosper, developing itself fully and freely, embracing all human industry, only when it is based on equality, when all capital and every instrument of labour, including the soil, belong to the people by right of collective property . . . Once this is acknowledged we hardly oppose the creation of co-operative associations; we find them necessary in many respects . . . they accustom the workers to organise, pursue, and manage their interests themselves, without interference either by bourgeois capital or by bourgeois control . . . [they must be] founded on the principle of solidarity and collectivity rather than on bourgeois exclusivity, then society will pass from its present situation to one of equality and justice without too many great upheavals." [The Basic Bakunin, p. 153]

Until then, co-operatives will exist within capitalism but not replace it by market forces -- only a social movement and collective action can fully secure their full development. This means that while anarchists support, create and encourage co-operatives within capitalism, we understand "the impossibility of putting into practice the co-operative system under the existing conditions of the predominance of bourgeois capital in the process of production and distribution of wealth." Because of this, most anarchists stress the need for more combative organisations such as industrial and community unions and other bodies "formed," to use Bakunin's words, "for the organisation of toilers against the privileged world" in order to help bring about a free society. [The Political Philosophy of Bakunin, p. 385]

Finally, we must note an irony with Nozick's argument, namely the notion that capitalism (his "free society") allows a "voluntary" path to economic liberty. The irony is two-fold. First, the creation of capitalism was the result of state action (see section F.8). While working class people are expected to play by the rules decreed by capitalism, capitalists have never felt the urge to do so. It is this state coercion which helped create the path-dependency which stops "the market" selecting more efficient and productive ways of production. Secondly, Nozick's own theory of (property) rights denies that stolen wealth can be legitimately transferred. In other words, expecting workers to meekly accept previous coercion by seeking investors to fund their attempts at economic liberty, as Nozick did, is implicitly accepting that theft is property. While such intellectual incoherence is to be expected from defenders of capitalism, it does mean that propertarians really have no ground to oppose working class people following the advice of libertarians and expropriating their workplaces. In other words, transforming the environment and breaking the path-dependency which stops economic liberty from flowering to its full potential.

## J.5.12 If self-management were more efficient then surely the market would force capitalists to introduce it?

Some supporters of capitalism argue that if self-management really were more efficient than hierarchy, then capitalists would be forced to introduce it by the market. As propertarian Robert Nozick argued, if workers' control meant that "the productivity of the workers in a factory rises . . . then the individual owners pursuing profits will reorganise the productive process. If the productivity of workers remains the same . . . then in the process of competing for labourers firms will alter their internal work organisation." This meant that "individual owners pursuing profits . . . will reorganise the productive process." [Anarchy, State, and Utopia, p. 248] As this has not happened then self-management cannot be more efficient.

While such a notion seems plausible in theory, in practice it is flawed as "there is a vast quantity of empirical evidence demonstrating that participatory workplaces tend to be places of higher morale and greater productivity than authoritarian workplaces." [David Schweickart , Against Capitalism, p. 228] So Nozick's thought experiment is contradicted by reality. Capitalism places innumerable barriers to the spread of worker empowering structures within production, in spite (perhaps, as we will see, because) of their (well-documented) higher efficiency and productivity. This can be seen from the fact that while the increased efficiency associated with workers' participation and self-management has attracted the attention of many capitalist firms, the few experiments conducted have failed to spread even though they were extremely successful. This is due to the nature of capitalist production and the social relationships it produces.

As we noted in section D.10, capitalist firms (particularly in the west) made a point of introducing technologies and management structures that aimed to deskill and disempower workers. In this way, it was hoped to make the worker increasingly subject to "market discipline" (i.e. easier to train, so increasing the pool of workers available to replace any specific worker and so reducing workers power by increasing management's power to fire them). Of course, what actually happens is that after a short period of time while management gained the upper hand, the workforce found newer and more effective ways to fight back and assert their productive power again. While for a short time the technological change worked, over the longer period the balance of forces changed, so forcing management to continually try to empower themselves at the expense of the workforce.

It is unsurprising that such attempts to reduce workers to order-takers fail. Workers' experiences and help are required to ensure production actually happens at all. When workers carry out their orders strictly and faithfully (i.e. when they "work to rule") production stops. So most capitalists are aware of the need to get workers to "co-operate" within the workplace to some degree. A few capitalist companies have gone further. Seeing the advantages of fully exploiting (and we do mean exploiting) the experience, skills, abilities and thoughts of their employers which the traditional authoritarian capitalist workplace denies them, some have introduced various schemes to "enrich" and "enlarge" work, increase "co-operation" between workers and their bosses, to encourage workers to "participate" in their own exploitation by introducing "a modicum of influence, a strictly limited area of decision-making power, a voice -- at best secondary -- in the control of conditions of the workplace." [Sam Dolgoff, The Anarchist Collectives, p. 81] The management and owners still have the power and still reap unpaid labour from the productive activity of the workforce.

David Noble provides a good summary of the problems associated with experiments in workers' self-management within capitalist firms:

> "Participation in such programs can indeed be a liberating and exhilarating experience, awakening people to their own untapped potential and also to the real possibilities of collective worker control of production. As one manager described the former pilots [workers in a General Electric program]: 'These people will never be the same again. They have seen that things can be different.' But the excitement and enthusiasm engendered by such programs, as well as the heightened sense of commitment to a common purpose, can easily be used against the interests of the work force. First, that purpose is not really 'common' but is still determined by management alone, which continues to decide what will be produced, when, and where. Participation in production does not include participation in decisions on investment, which remains the prerogative of ownership. Thus participation is, in reality, just a variation of business as usual -- taking orders -- but one which encourages obedience in the name of co-operation.

> "Second, participation programs can contribute to the creation of an elite, and reduced, work force, with special privileges and more 'co-operative' attitudes toward management -- thus at once undermining the adversary stance of unions and reducing membership . . .

> "Third, such programs enable management to learn from workers -- who are now encouraged by their co-operative spirit to share what they know -- and, then, in Taylorist tradition, to use this knowledge against the workers. As one former pilot reflected, 'They learned from the guys on the floor, got their knowledge about how to optimise the technology and then, once they had it, they eliminated the Pilot Program, put that knowledge into the machines, and got people without any knowledge to run them -- on the Company's terms and without adequate compensation. They kept all the gains for themselves.' . . .

> "Fourth, such programs could provide management with a way to circumvent union rules and grievance procedures or eliminate unions altogether." [Forces of Production, pp. 318-9]

Capitalist introduced and supported "workers' control" is very like the situation when a worker receives stock in the company they work for. If it goes a little way toward redressing the gap between the value produced by that person's labour and the wage they receive for it, that in itself cannot be a totally bad thing (although this does not address the issue of workplace hierarchy and its social relations). The real downside of this is the "carrot on a stick" enticement to work harder -- if you work extra hard for the company, your stock will be worth more. Obviously, though, the bosses get rich off you, so the more you work, the richer they get, the more you are getting ripped off. It is a choice that anarchists feel many workers cannot afford to make -- they need or at least want the money -- but we believe that it does not work as workers simply end up working harder, for less. After all, stocks do not represent all profits (large amounts of which end up in the hands of top management) nor are they divided just among those who labour. Moreover, workers may be less inclined to take direct action, for fear that they will damage the value of "their" company's stock, and so they may find themselves putting up with longer, more intense work in worse conditions.

Be that as it may, the results of such capitalist experiments in "workers' control" are interesting and show why self-management will not spread by market forces. According to one expert: "There is scarcely a study in the entire literature which fails to demonstrate that satisfaction in work is enhanced or . . .productivity increases occur from a genuine increase in worker's decision-making power. Findings of such consistency . . . are rare in social research." [Paul B. Lumberg, quoted by Herbert Gintis, "The nature of Labour Exchange and the Theory of Capitalist Production", Radical Political Economy, vol. 1, Samuel Bowles and Richard Edwards (eds.), p. 252] In spite of these findings, a "shift toward participatory relationships is scarcely apparent in capitalist production" and this is "not compatible with the neo-classical assertion as to the efficiency of the internal organisation of capitalist production." [Gintz, Op. Cit., p. 252] Economist William Lazonick indicates the reason when he writes that "[m]any attempts at job enrichment and job enlargement in the first half of the 1970s resulted in the supply of more and better effort by workers. Yet many 'successful' experiments were cut short when the workers whose work had been enriched and enlarged began questioning traditional management prerogatives inherent in the existing hierarchical structure of the enterprise." [Competitive Advantage on the Shop Floor, p. 282]

This is an important result, as it indicates that the ruling sections within capitalist firms have a vested interest in not introducing such schemes, even though they are more efficient methods of production. As can easily be imagined, managers have a clear incentive to resist participatory schemes (as David Schweickart notes, such resistance, "often bordering on sabotage, is well known and widely documented" [Op. Cit., p. 229]). As an example of this David Noble discusses a scheme ran by General Electric in the late 1960s:

> "After considerable conflict, GE introduced a quality of work life program . . . which gave workers much more control over the machines and the production process and eliminated foremen. Before long, by all indicators, the program was succeeding -- machine use, output and product quality went up; scrap rate, machine downtime, worker absenteeism and turnover when down, and conflict on the floor dropped off considerably. Yet, little more than a year into the program -- following a union demand that it be extended throughout the shop and into other GE locations -- top management abolished the program out of fear of losing control over the workforce. Clearly, the company was willing to sacrifice gains in technical and economic efficiency in order to regain and insure management control." [Progress Without People, p. 65f]

Simply put, managers and capitalists can see that workers' control experiments expose the awkward fact that they are not needed, that their role is not related to organising production but exploiting workers. They have no urge to introduce reforms which will ultimately make themselves redundant. Moreover, most enjoy the power that comes with their position and have no desire to see it ended. This also places a large barrier in the way of workers' control. Interestingly, this same mentality explains why capitalists often support fascist regimes: "The anarchist Luigi Fabbri termed fascism a preventative counter-revolution; but in his essay he makes the important point that the employers, particularly in agriculture, were not so much moved by fear of a general revolution as by the erosion of their own authority and property rights which had already taken place locally: 'The bosses felt they were no longer bosses.'" [Adrian Lyttelton, "Italian Fascism", pp. 81-114, Fascism: a Reader's Guide, p. 91]

However, it could be claimed that owners of stock, being concerned by the bottom-line of profits, could force management to introduce participation. By this method, competitive market forces would ultimately prevail as individual owners, pursuing profits, reorganise production and participation spreads across the economy. Indeed, there are a few firms that have introduced such schemes but there has been no tendency for them to spread. This contradicts "free market" capitalist economic theory which states that those firms which introduce more efficient techniques will prosper and competitive market forces will ensure that other firms will introduce the technique.

This has not happened for three reasons.

Firstly, the fact is that within "free market" capitalism keeping (indeed strengthening) skills and power in the hands of the workers makes it harder for a capitalist firm to maximise profits (i.e. unpaid labour). It strengthens the power of workers, who can use that power to gain increased wages (i.e. reduce the amount of surplus value they produce for their bosses). Workers' control also leads to a usurpation of capitalist prerogatives -- including their share of revenues and their ability to extract more unpaid labour during the working day. While in the short run workers' control may lead to higher productivity (and so may be toyed with), in the long run, it leads to difficulties for capitalists to maximise their profits:

> "given that profits depend on the integrity of the labour exchange, a strongly centralised structure of control not only serves the interests of the employer, but dictates a minute division of labour irrespective of considerations of productivity. For this reason, the evidence for the superior productivity of 'workers control' represents the most dramatic of anomalies to the neo-classical theory of the firm: worker control increases the effective amount of work elicited from each worker and improves the co-ordination of work activities, while increasing the solidarity and delegitimising the hierarchical structure of ultimate authority at its root; hence it threatens to increase the power of workers in the struggle over the share of total value." [Gintz, Op. Cit., p. 264]

A workplace which had extensive workers participation would hardly see the workers agreeing to reduce their skill levels, take a pay cut or increase their pace of work simply to enhance the profits of capitalists. Simply put, profit maximisation is not equivalent to efficiency. Getting workers to work longer, more intensely or in more unpleasant conditions can increase profits but it does not yield more output for the same inputs. Workers' control would curtail capitalist means of enhancing profits by changing the quality and quantity of work. It is this requirement which also aids in understanding why capitalists will not support workers' control -- even though it is more efficient, it reduces capitalist power in production. Moreover, demands to change the nature of workers' inputs into the production process in order to maximise profits for capitalists would provoke a struggle over the intensity of work, working hours, and over the share of value added going to workers, management and owners and so destroy the benefits of participation.

Thus power within the workplace plays a key role in explaining why workers' control does not spread -- it reduces the ability of bosses to extract more unpaid labour from workers.

The second reason is related to the first. It too is based on the power structure within the company but the power is related to control over the surplus produced by the workers rather than the ability to control how much surplus is produced in the first place (i.e. power over workers). Hierarchical management is the way to ensure that profits are channelled into the hands of a few. By centralising power, the surplus value produced by workers can be distributed in a way which benefits those at the top (i.e. management and capitalists). This explains the strange paradox of workers' control experiments being successful but being cancelled by management. This is easily explained once the hierarchical nature of capitalist production (i.e. of wage labour) is acknowledged. Workers' control, by placing (some) power in the hands of workers, undermines the authority of management and, ultimately, their power to control the surplus produced by workers and allocate it as they see fit. Thus, while workers' control does reduce costs, increase efficiency and productivity (i.e. maximise the difference between prices and costs) it (potentially) reduces the power of management and owners to allocate that surplus as they see fit. Indeed, it can be argued that hierarchical control of production exists solely to provide for the accumulation of capital in a few hands, not for efficiency or productivity (see Stephan A. Margin, "What do Bosses do? The Origins and Functions of Hierarchy in Capitalist Production", Op. Cit., pp. 178-248).

As David Noble argues, power is the key to understanding capitalism, not the drive for profits as such:

> "In opting for control [over the increased efficiency of workers' control] . . . management . . . knowingly and, it must be assumed, willingly, sacrificed profitable production. . . . [This] illustrates not only the ultimate management priority of power over both production and profit within the firm, but also the larger contradiction between the preservation of private power and prerogatives, on the one hand, and the social goals of efficient, quality, and useful production, on the other . . .

> "It is a common confusion, especially on the part of those trained in or unduly influenced by formal economics (liberal and Marxist alike), that capitalism is a system of profit-motivated, efficient production. This is not true, nor has it ever been. If the drive to maximise profits, through private ownership and control over the process of production, has served historically as the primary means of capitalist development, it has never been the end of that development. The goal has always been domination (and the power and privileges that go with it) and the preservation of domination. There is little historical evidence to support the view that, in the final analysis, capitalists play by the rules of the economic game imagined by theorists. There is ample evidence to suggest, on the other hand, that when the goals of profit-making and efficient production fail to coincide with the requirements of continued dominance, capital will resort to more ancient means: legal, political, and, if need be, military. Always, behind all the careful accounting, lies the threat of force. This system of domination has been legitimated in the past by the ideological invention that private ownership of the means of production and the pursuit of profit via production are always ultimately beneficial to society. Capitalism delivers the goods, it is argued, better, more cheaply, and in larger quantity, and in so doing, fosters economic growth . . . The story of the Pilot Program -- and it is but one among thousands like it in U.S. industry -- raises troublesome questions about the adequacy of this mythology as a description of reality." [Forces of Production, pp. 321-2]

Hierarchical organisation (domination) is essential to ensure that profits are controlled by a few and can, therefore, be allocated by them in such a way to ensure their power and privileges. By undermining such authority, workers' control also undermines that power to maximise profits in a certain direction even though it increases "profits" (the difference between prices and costs) in the abstract. As workers' control starts to extend (or management sees its potential to spread) into wider areas such as investment decisions, how to allocate the surplus (i.e. profits) between wages, investment, dividends, management pay and so on, then they will seek to end the project in order to ensure their power over both the workers and the surplus they, the workers, produce (this is, of course, related to the issue of lack of control by investors in co-operatives raised in the last section).

As such, the opposition by managers to workers' control will be reflected by those who actually own the company who obviously would not support a regime which will not ensure the maximum return on their investment. This would be endangered by workers' control, even though it is more efficient and productive, as control over the surplus rests with the workers and not a management elite with similar interests and aims as the owners -- an egalitarian workplace would produce an egalitarian distribution of surplus, in other words (as proven by the experience of workers' co-operatives). In the words of one participant of the GE workers' control project: "If we're all one, for manufacturing reasons, we must share in the fruits equitably, just like a co-op business." [quoted by Noble, Op. Cit., p. 295] Such a possibility is one few owners would agree to.

Thirdly, to survive within the "free" market means to concentrate on the short term. Long terms benefits, although greater, are irrelevant. A free market requires profits now and so a firm is under considerable pressure to maximise short-term profits by market forces. Participation requires trust, investment in people and technology and a willingness to share the increased value added that result from workers' participation with the workers who made it possible. All these factors would eat into short term profits in order to return richer rewards in the future. Encouraging participation thus tends to increase long term gains at the expense of short-term ones (to ensure that workers do not consider participation as a con, they must experience real benefits in terms of power, conditions and wage rises). For firms within a free market environment, they are under pressure from share-holders and their financiers for high returns as soon as possible. If a company does not produce high dividends then it will see its stock fall as shareholders move to those companies that do. Thus the market forces companies to act in such ways as to maximise short term profits.

If faced with a competitor which is not making such investments (and which is investing directly into deskilling technology or intensifying work loads which lowers their costs) and so wins them market share, or a downturn in the business cycle which shrinks their profit margins and makes it difficult for the firm to meet its commitments to its financiers and workers, a company that intends to invest in people and trust will usually be rendered unable to do so. Faced with the option of empowering people in work or deskilling them and/or using the fear of unemployment to get workers to work harder and follow orders, capitalist firms have consistently chosen (and probably preferred) the latter option (as occurred in the 1970s).

Thus, workers' control is unlikely to spread through capitalism because it entails a level of working class consciousness and power that is incompatible with capitalist control: "If the hierarchical division of labour is necessary for the extraction of surplus value, then worker preferences for jobs threatening capitalist control will not be implemented." [Gintis, Op. Cit., p. 253] The reason why it is more efficient, ironically, ensures that a capitalist economy will not select it. The "free market" will discourage empowerment and democratic workplaces, at best reducing "co-operation" and "participation" to marginal issues (and management will still have the power of veto).

The failure of moves towards democratic workplaces within capitalism are an example of that system in conflict with itself -- pursuing its objectives by methods which constantly defeat those same objectives. As Paul Carden argued, the "capitalist system can only maintain itself by trying to reduce workers into mere order-takers . . . At the same time the system can only function as long as this reduction is never achieved . . . [for] the system would soon grind to a halt . . . [However] capitalism constantly has to limit this participation (if it didn't the workers would soon start deciding themselves and would show in practice now superfluous the ruling class really is)." [Modern Capitalism and Revolution, pp. 45-46] Thus "workers' control" within a capitalist firm is a contradictory thing -- too little power and it is meaningless, too much and workplace authority structures and capitalist share of, and control over, value added can be harmed. Attempts to make oppressed, exploited and alienated workers work if they were neither oppressed, exploited nor alienated will always fail.

For a firm to establish committed and participatory relations internally, it must have external supports -- particularly with providers of finance (which is why co-operatives benefit from credit unions and co-operating together). The price mechanism proves self-defeating to create such supports and that is why we see "participation" more fully developed within Japanese and German firms (although it is still along way from fully democratic workplaces), who have strong, long term relationships with local banks and the state which provides them with the support required for such activities. As William Lazonick notes, Japanese industry had benefited from the state ensuring "access to inexpensive long-term finance, the sine qua non of innovating investment strategies" along with a host of other supports, such as protecting Japanese industry within their home markets so they could "develop and utilise their productive resources to the point where they could attain competitive advantage in international competition." [Op. Cit., p. 305] The German state provides its industry with much of the same support.

Therefore, "participation" within capitalist firms will have little or no tendency to spread due to the actions of market forces. In spite of such schemes almost always being more efficient, capitalism will not select them because they empower workers and make it hard for capitalists to generate and control their profits. Hence capitalism, by itself, will have no tendency to produce more libertarian organisational forms within industry. Those firms that do introduce such schemes will be the exception rather than the rule (and the schemes themselves will be marginal in most respects and subject to veto from above). For such schemes to spread, collective action is required (such as state intervention to create the right environment and support network or -- from an anarchist point of view -- union and community direct action).

Such schemes, as noted above, are just forms of self-exploitation, getting workers to help their robbers and so not a development anarchists seek to encourage. We have discussed this here just to be clear that, firstly, such forms of structural reforms are not self-management, as managers and owners still have the real power, and, secondly, even if such forms are somewhat liberatory and more efficient, market forces will not select them precisely because the latter is dependent on the former. Thirdly, they would still be organised for exploitation as workers would not be controlling all the goods they produced. As with an existing capitalist firm, part of their product would be used to pay interest, rent and profit. For anarchists "self-management is not a new form of mediation between workers and their bosses . . . [it] refers to the very process by which the workers themselves overthrow their managers and take on their own management and the management of production in their own workplace." [Dolgoff, Op. Cit., p. 81] Hence our support for co-operatives, unions and other self-managed structures created and organised from below by and for working class people by their own collective action.

## J.5.13 What are Modern Schools?

Modern schools are alternative schools, self-managed by students, teachers and parents which reject the authoritarian schooling methods of the modern "education" system. Such schools have been a feature of the anarchist movement since the turn of the 20th century while interest in libertarian forms of education has existed in anarchist theory from the beginning. All the major anarchist thinkers, from Godwin through Proudhon, Bakunin and Kropotkin to modern activists like Colin Ward, have stressed the importance of libertarian (or rational) education, education that develops all aspects of the student (mental and physical -- and so termed integral education) as well as encouraging critical thought and mental freedom. The aim of such education is ensure that the "industrial worker, the man [sic!] of action and the intellectual would all be rolled into one." [Proudhon, quoted by Steward Edward, The Paris Commune, p. 274]

Anyone involved in radical politics, constantly and consistently challenges the role of the state's institutions and their representatives within our lives. The role of bosses, the police, social workers, the secret service, managers, doctors and priests are all seen as part of a hierarchy which exists to keep us, the working class, subdued. It is relatively rare, though, for the left-wing to call into question the role of teachers. Most left wing activists and a large number of libertarians believe that education is always good.

Those involved in libertarian education believe the contrary. They believe that national education systems exist only to produce citizens who will be blindly obedient to the dictates of the state, citizens who will uphold the authority of government even when it runs counter to personal interest and reason, wage slaves who will obey the orders of their boss most of the time and consider being able to change bosses as freedom. They agree with William Godwin (one of the earliest critics of national education systems) when he wrote that "the project of a national education ought to be discouraged on account of its obvious alliance with national government . . . Government will not fail to employ it to strengthen its hand and perpetuate its institutions . . . Their views as instigator of a system will not fail to be analogous to their views in their political capacity." [quoted by Colin Ward, Anarchy in Action, p. 81]

With the growth of industrialism in the 19th century state schools triumphed, not through a desire to reform but as an economic necessity. Industry did not want free thinking individuals, it wanted workers, instruments of labour, and it wanted them punctual, obedient, passive and willing to accept their disadvantaged position. According to Nigel Thrift, many employers and social reformers became convinced that the earliest generations of workers were almost impossible to discipline (i.e. to get accustomed to wage labour and workplace authority). They looked to children, hoping that "the elementary school could be used to break the labouring classes into those habits of work discipline now necessary for factory production . . . Putting little children to work at school for very long hours at very dull subjects was seen as a positive virtue, for it made them habituated, not to say naturalised, to labour and fatigue." [quoted by Juliet B. Schor, The Overworked American, p. 61]

Thus supporters of Modern Schools recognise that the role of education is an important one in maintaining hierarchical society -- for government and other forms of hierarchy (such as wage labour) must always depend on the opinion of the governed. Francisco Ferrer (the most famous libertarian educator) argued that:

> "Rulers have always taken care to control the education of the people. They know their power is based almost entirely on the school and they insist on retaining their monopoly. The school is an instrument of domination in the hands of the ruling class." [quoted by Clifford Harper, Anarchy: A Graphic Guide, p. 100]

Little wonder, then, that Emma Goldman argued that "modern methods of education" have "little regard for personal liberty and originality of thought. Uniformity and imitation is [its] motto." The school "is for the child what the prison is for the convict and the barracks for the solder -- a place where everything is being used to break the will of the child, and then to pound, knead, and shape it into a being utterly foreign to itself." Hence the importance of Modern Schools. It is a means of spreading libertarian education within a hierarchical society and undercut one of the key supports for that society -- the education system. Instead of hierarchical education, Modern schools exist to "develop the individual through knowledge and the free play of characteristic traits, so that [the child] may become a social being, because he had learned to know himself, to know his relation to his fellow[s]." [Red Emma Speaks, pp. 141-2, p. 140 and p. 145] It would be an education for freedom, not for subservience:

> "Should the notion of freedom but awaken in man, free men dream only of freeing themselves now and for all time: but instead, all we do is churn out learned men who adapt in the most refined manner to every circumstance and fall to the level of slavish, submissive souls. For the most part, what are our fine gentlemen brimful of intellect and culture? Sneering slavers and slaves themselves." [Max Stirner, No Gods, No Masters, vol. 1, p. 12]

The Modern School Movement (also known as the Free School Movement) over the past century has been an attempt to represent part of this concern about the dangers of state and church schools and the need for libertarian education. The idea of libertarian education is that knowledge and learning should be linked to real life processes as well as personal usefulness and should not be the preserve of a special institution. Thus Modern Schools are an attempt to establish an environment for self development in an overly structured and rationalised world. An oasis from authoritarian control and as a means of passing on the knowledge to be free:

> "The underlying principle of the Modern School is this: education is a process of drawing out, not driving in; it aims at the possibility that the child should be left free to develop spontaneously, directing his own efforts and choosing the branches of knowledge which he desires to study . . . the teacher . . . should be a sensitive instrument responding to the needs of the child . . . a channel through which the child may attain so much of the ordered knowledge of the world as he shows himself ready to receive and assimilate." [Goldman, Op. Cit., p. 146]

The Modern School bases itself on libertarian education techniques. Libertarian education, very broadly, seeks to produce children who will demand greater personal control and choice, who think for themselves and question all forms of authority:

> "We don't hesitate to say we want people who will continue to develop. People constantly capable of destroying and renewing their surroundings and themselves: whose intellectual independence is their supreme power, which they will yield to none; always disposed for better things, eager for the triumph of new ideas, anxious to crowd many lives into the life they have. It must be the aim of the school to show the children that there will be tyranny as long as one person depends on another." [Ferrer, quoted by Harper, Op. Cit., p. 100]

Thus the Modern School insists that the child is the centre of gravity in the education process -- and that education is just that, not indoctrination:

> "I want to form a school of emancipation, concerned with banning from the mind whatever divides people, the false concepts of property, country and family so as to attain the liberty and well-being which all desire. I will teach only simple truth. I will not ram dogma into their heads. I will not conceal one iota of fact. I will teach not what to think but how to think." [Ferrer, quoted by Harper, Op. Cit., pp. 99-100]

The Modern School has no rewards or punishments, exams or mark -- the everyday tortures of conventional schooling. And because practical knowledge is more useful than theory, lessons were often held in factories, museums or the countryside. The school was also used by parents, and Ferrer planned a Popular University.

> "Higher education, for the privileged few, should be for the general public, as every human has a right to know; and science, which is produced by observers and workers of all countries and ages, ought not be restricted to class." [Ferrer, quoted by Harper, Op. Cit., p. 100]

Thus Modern Schools are based on encouraging self-education in a co-operative, egalitarian and libertarian atmosphere in which the pupil (regardless of age) can develop themselves and their interests to the fullest of their abilities. In this way Modern Schools seek to create anarchists by a process of education which respects the individual and gets them to develop their own abilities in a conducive setting.

Modern Schools have been a constant aspect of the anarchist movement since the late 1890s. The movement was started in France by Louise Michel and Sebastien Faure, where Francisco Ferrer became acquainted with them. He founded his Modern School in Barcelona in 1901, and by 1905 there were 50 similar schools in Spain (many of them funded by anarchist groups and trade unions and, from 1919 onward, by the C.N.T. -- in all cases the autonomy of the schools was respected). In 1909, Ferrer was falsely accused by the Spanish government of leading an insurrection and executed in spite of world-wide protest and overwhelming proof of his innocence. His execution, however, gained him and his educational ideas international recognition and inspired a Modern School progressive education movement across the globe.

However, for most anarchists, Modern Schools are not enough in themselves to produce a libertarian society. They agree with Bakunin:

> "For individuals to be moralised and become fully human . . . three things are necessary: a hygienic birth, all-round education, accompanied by an upbringing based on respect for labour, reason, equality, and freedom and a social environment wherein each human individual will enjoy full freedom and really by, de jure and de facto, the equal of every other.

> "Does this environment exist? No. Then it must be established. . . [otherwise] in the existing social environment . . . on leaving [libertarian] schools they [the student] would enter a society governed by totally opposite principles, and, because society is always stronger than individuals, it would prevail over them . . . [and] demoralise them." [The Basic Bakunin, p, 174]

Because of this, Modern Schools must be part of a mass working class revolutionary movement which aims to build as many aspects of the new world as possible in the old one before, ultimately, replacing it. Otherwise they are just useful as social experiments and their impact on society marginal. Thus, for anarchists, this process of education is part of the class struggle, not in place of it and so "the workers [must] do everything possible to obtain all the education they can in the material circumstances in which they currently find themselves . . . [while] concentrat[ing] their efforts on the great question of their economic emancipation, the mother of all other emancipations." [Bakunin, Op. Cit., p. 175]

Before finishing, we must stress that hierarchical education (like the media), cannot remove the effects of actual life and activity in shaping/changing people and their ideas, opinions and attitudes. While education is an essential part of maintaining the status quo and accustoming people to accept hierarchy, the state and wage slavery, it cannot stop individuals from learning from their experiences, ignoring their sense of right and wrong, recognising the injustices of the current system and the ideas that it is based upon. This means that even the best state (or private) education system will still produce rebels -- for the experience of wage slavery and state oppression (and, most importantly, struggle) is shattering to the ideology spoon-fed children during their "education" and reinforced by the media.

For more information on Modern Schools see Paul Avrich's The Modern School Movement: Anarchism and education in the United States, Emma Goldman's essays "Francisco Ferrer and the Modern School" (in Anarchism and Other Essays) and "The Social Importance of the Modern School" (in Red Emma Speaks) as well as A.S Neil's Summerhill. For a good introduction to anarchist viewpoints on education see "Kropotkin and technical education: an anarchist voice" by Michael Smith (in For Anarchism, David Goodway (ed.),) and Michael Bakunin's "All-Round Education" (in The Basic Bakunin). For an excellent summary of the advantages and benefits of co-operative learning, see Alfie Kohn's No Contest.

## J.5.14 What is Libertarian Municipalism?

As we noted in section J.2, most anarchists reject participating in electoral politics. A notable exception was Murray Bookchin who not only proposed voting but also a non-parliamentary electoral strategy for anarchists. He repeated this proposal in many of his later works, such as From Urbanisation to Cities, and has made it -- at least in the USA -- one of the many alternatives anarchists are involved in.

According to Bookchin, "the proletariat, as do all oppressed sectors of society, comes to life when it sheds its industrial habits in the free and spontaneous activity of communising, or taking part in the political life of the community." In other words, Bookchin thought that democratisation of local communities may be as strategically important, or perhaps more important, to anarchists than workplace struggles. Since local politics is humanly scaled, Bookchin argued that it can be participatory rather than parliamentary. Or, as he put it, the "anarchic ideal of decentralised, stateless, collectively managed, and directly democratic communities -- of confederated municipalities or 'communes' -- speaks almost intuitively, and in the best works of Proudhon and Kropotkin, consciously, to the transforming role of libertarian municipalism as the framework of a liberatory society." "Theses on Libertarian Municipalism", pp. 9-22, The Anarchist Papers, Dimitrios I. Roussopoulos (ed.),p. 10] He also pointed out that, historically, the city has been the principle countervailing force to imperial and national states, haunting them as a potential challenge to centralised power and continuing to do so today, as can be seen in the conflicts between national government and municipalities in many countries.

Despite the libertarian potential of urban politics, "urbanisation" -- the growth of the modern megalopolis as a vast wasteland of suburbs, shopping malls, industrial parks, and slums that foster political apathy and isolation in realms of alienated production and private consumption -- is antithetical to the continued existence of those aspects of the city that might serve as the framework for a libertarian municipalism: "When urbanisation will have effaced city life so completely that the city no longer has its own identity, culture, and spaces for consociation, the bases for democracy -- in whatever way the word in defined -- will have disappeared and the question of revolutionary forms will be a shadow game of abstractions." Despite this danger Bookchin argued that a libertarian politics of local government is still possible, provided anarchists get our act together: "The Commune still lies buried in the city council; the sections still lie buried in the neighbourhood; the town meeting still lies buried in the township; confederal forms of municipal association still lie buried in regional networks of towns and cities." [Op. Cit., p. 16 and p. 21]

What would anarchists do electorally at the local level? Bookchin proposed that libertarians stand in local elections in order to change city and town charters to make them participatory: "An organic politics based on such radical participatory forms of civic association does not exclude the right of anarchists to alter city and town charters such that they validate the existence of directly democratic institutions. And if this kind of activity brings anarchists into city councils, there is no reason why such a politics should be construed as parliamentary, particularly if it is confined to the civic level and is consciously posed against the state." [Op. Cit., p. 21]

In short, Libertarian Muncipalism "depends upon libertarian leftists running candidates at the local level, calling for the division of municipalities into wards, where popular assemblies can be created that bring people into full and direct participation in political life . . . municipalities would [then] confederate into a dual power to oppose the nation-state and ultimately dispense with it and with the economic forces that underpin statism as such." [Democracy and Nature no. 9, p. 158] This would be part of a social wide transformation, whose "[m]inimal steps . . . include initiating Left Green municipalist movements that propose neighbourhood and town assemblies -- even if they have only moral functions at first -- and electing town and city councillors that advance the cause of these assemblies and other popular institutions. These minimal steps can lead step-by-step to the formation of confederal bodies . . . Civic banks to fund municipal enterprises and land purchases; the fostering of new ecologically-orientated enterprises that are owned by the community." Thus Bookchin saw Libertarian Muncipalism as a process by which the state can be undermined by using elections as the means of creating popular assemblies. Part of this would be the "municipalisation of property" which would "bring the economy as a whole into the orbit of the public sphere, where economic policy could be formulated by the entire community." [From Urbanisation to Cities, p. 266 and p. 235]

In evaluating Bookchin's proposal, several points come to mind.

Firstly, it is clear that Libertarian Muncipalism's arguments in favour of community assemblies is important and cannot be ignored. Bookchin was right to note that, in the past, many anarchists placed far too much stress on workplace struggles and workers' councils as the framework of a free society. Many of the really important issues that affect us cannot be reduced to workplace organisations, which by their very nature disenfranchise those who do not work in industry (such as housewives, the old, and so on). And, of course, there is far more to life than work and so any future society organised purely around workplace organisations is reproducing capitalism's insane glorification of economic activity, at least to some degree. So, in this sense, Libertarian Muncipalism has a very valid point -- a free society will be created and maintained within the community as well as in the workplace. However, this perspective was hardly alien to such anarchist thinkers as Proudhon, Bakunin and Kropotkin who all placed communes at the centre of their vision of a free society.

Secondly, Bookchin and other Libertarian Muncipalists are correct to argue that anarchists should work in their local communities. Many anarchists are doing just that and are being very successful as well. However, most anarchists reject the idea of a "confederal muncipalist movement run[ning] candidates for municipal councils with demands for the institution of public assemblies" as viable means of "struggle toward creating new civic institutions out of old ones (or replacing the old ones altogether)." [Bookchin, Op. Cit., p. 229 and p. 267]

The most serious objection to this has to do with whether politics in most cities has already become too centralised, bureaucratic, inhumanly scaled, and dominated by capitalist interests to have any possibility of being taken over by anarchists running on platforms of participatory democratisation. Merely to pose the question seems enough to answer it. There is no such possibility in the vast majority of cities, and hence it would be a waste of time and energy for anarchists to support libertarian municipalist candidates in local elections -- time and energy that could be more profitably spent in direct action. If the central governments are too bureaucratic and unresponsive to be used by Libertarian Municipalists, the same can be said of local ones too -- particularly as the local state has become increasingly controlled by the central authorities (in the UK, for example, the Conservative government of the 1980s successfully centralised power away from local councils to undercut their ability to resist the imposition of its neo-liberal policies).

The counter-argument to this is that even if there is no chance of such candidates being elected, their standing for elections would serve a valuable educational function. The answer to this is: perhaps, but would it be more valuable than direct action? Would its educational value, if any, outweigh the disadvantages of electioneering discussed in section J.2? Given the ability of major media to marginalise alternative candidates, we doubt that such campaigns would have enough educational value to outweigh these disadvantages. Moreover, being an anarchist does not make one immune to the corrupting effects of electioneering. History is littered with radical, politically aware movements using elections and ending up becoming part of the system they aimed to transform. Most anarchists doubt that Libertarian Muncipalism will be any different -- after all, it is the circumstances the parties find themselves in which are decisive, not the theory they hold. Why would libertarians be immune to this but not Marxists or Greens?

Lastly, most anarchists question the whole process on which Libertarian Muncipalism bases itself on. The idea of communes is a key one of anarchism and so strategies to create them in the here and now are important. However, to think that using alienated, representative institutions to abolish these institutions is wrong. As Italian activists who organised a neighbourhood assembly by non-electoral means argue "[t]o accept power and to say that the others were acting in bad faith and that we would be better, would force non-anarchists towards direct democracy. We reject this logic and believe that organisations must come from the grassroots." ["Community Organising in Southern Italy", pp. 16-19, Black Flag no. 210, p. 18]

Thus Libertarian Municipalism reverses the process by which community assemblies will be created. Instead of anarchists using elections to build such bodies, they must work in their communities directly to create them (see section J.5.1 for more details). Using the catalyst of specific issues of local interest, anarchists could propose the creation of a community assembly to discuss the issues in question and organise action to solve them. Rather than stand in local elections, anarchists should encourage people to create these institutions themselves and empower themselves by collective self-activity. As Kropotkin argued, "Laws can only follow the accomplished facts; and even if they do honestly follow them -- which is usually not the case -- a law remains a dead letter so long as there are not on the spot the living forces required for making the tendencies expressed in the law an accomplished fact." [Anarchism, p. 171] Most anarchists, therefore, think it is far more important to create the "living forces" within our communities directly than waste energy in electioneering and the passing of laws creating or "legalising" community assemblies. In other words, community assemblies can only be created from the bottom up, by non-electoral means, a process which Libertarian Muncipalism confuses with electioneering.

So, while Libertarian Muncipalism does raise many important issues and correctly stresses the importance of community activity and self-management, its emphasis on electoral activity undercuts its liberatory promise. For most anarchists, community assemblies can only be created from below, by direct action, and (because of its electoral strategy) a Libertarian Municipalist movement will end up being transformed into a copy of the system it aims to abolish.

## J.5.15 What attitude do anarchists take to the welfare state?

The period of neo-liberalism since the 1980s has seen a rollback of the state within society by the right-wing in the name of "freedom," "individual responsibility" and "efficiency." The position of anarchists to this process is mixed. On the one hand, we are all in favour of reducing the size of the state and increasing individual responsibility and freedom but, on the other, we are well aware that this rollback is part of an attack on the working class and tends to increase the power of the capitalists over us as the state's (direct) influence is reduced. Thus anarchists appear to be on the horns of a dilemma -- or, at least, apparently.

So what attitude do anarchists take to the welfare state and attacks on it?

First we must note that this attack on "welfare" is somewhat selective. While using the rhetoric of "self-reliance" and "individualism," the practitioners of these "tough love" programmes have made sure that the major corporations continue to get state hand-outs and aid while attacking social welfare. In other words, the current attack on the welfare state is an attempt to impose market discipline on the working class while increasing state protection for the ruling class. Therefore, most anarchists have no problem defending social welfare programmes as these can be considered as only fair considering the aid the capitalist class has always received from the state (both direct subsidies and protection and indirect support via laws that protect property and so on). And, for all their talk of increasing individual choice, the right-wing remain silent about the lack of choice and individual freedom during working hours within capitalism.

Secondly, most of the right-wing inspired attacks on the welfare state are inaccurate. For example, Noam Chomsky notes that the "correlation between welfare payments and family life is real, though it is the reverse of what is claimed [by the right]. As support for the poor has declined, unwed birth-rates, which had risen steadily from the 1940s through the mid-1970s, markedly increased. 'Over the last three decades, the rate of poverty among children almost perfectly correlates with the birth-rates among teenage mothers a decade later,' Mike Males points out: 'That is, child poverty seems to lead to teenage childbearing, not the other way around.'" ["Rollback III", Z Magazine, April, 1995] The same charge of inaccurate scare-mongering can be laid at the claims about the evil effects of welfare which the rich and large corporations wish to save others (but not themselves) from. Such altruism is truly heart warming. For those in the United States or familiar with it, the same can be said of the hysterical attacks on "socialised medicine" and health-care reform funded by insurance companies and parroted by right-wing ideologues and politicians.

Thirdly, anarchists are just as opposed to capitalism as they are the state. This means that privatising state functions is no more libertarian than nationalising them. In fact, less so as such a process reduces the limited public say state control implies in favour of more private tyranny and wage-labour. As such, attempts to erode the welfare state without other, pro-working class, social reforms violates the anti-capitalist part of anarchism. Similarly, the introduction of a state supported welfare system rather than a for-profit capitalist run system (as in America) would hardly be considered any more a violation of libertarian principles as the reverse happening. In terms of reducing human suffering, though, most anarchists would oppose the latter and be in favour of the former while aiming to create a third (self-managed) alternative.

Fourthly, we must note that while most anarchists are in favour of collective self-help and welfare, we are opposed to the state. Part of the alternatives anarchists try and create are self-managed and community welfare projects (see next section). Moreover, in the past, anarchists and syndicalists were at the forefront in opposing state welfare schemes. This was because they were introduced not by socialists but by liberals and other supporters of capitalism to undercut support for radical alternatives and to aid long term economic development by creating the educated and healthy population required to use advanced technology and fight wars. Thus we find that:

> "Liberal social welfare legislation . . . were seen by many [British syndicalists] not as genuine welfare reforms, but as mechanisms of social control. Syndicalists took a leading part in resisting such legislation on the grounds that it would increase capitalist discipline over labour, thereby undermining working class independence and self-reliance." [Bob Holton, British Syndicalism: 1900-1914, p. 137]

Anarchists view the welfare state much as some feminists do. While they note, to quote Carole Pateman, the "patriarchal structure of the welfare state" they are also aware that it has "also brought challenges to patriarchal power and helped provide a basis for women's autonomous citizenship." She goes on to note that "for women to look at the welfare state is merely to exchange dependence on individual men for dependence on the state. The power and capriciousness of husbands is replaced by the arbitrariness, bureaucracy and power of the state, the very state that has upheld patriarchal power." This "will not in itself do anything to challenge patriarchal power relations." [The Disorder of Women, p. 195 and p. 200]

Thus while the welfare state does give working people more options than having to take any job or put up with any conditions, this relative independence from the market and individual capitalists has came at the price of dependence on the state -- the very institution that protects and supports capitalism in the first place. And has we have became painfully aware in recent years, it is the ruling class who has most influence in the state -- and so, when it comes to deciding what state budgets to cut, social welfare ones are first in line. Given that such programmes are controlled by the state, not working class people, such an outcome is hardly surprising. Not only this, we also find that state control reproduces the same hierarchical structures that the capitalist firm creates.

Unsurprisingly, anarchists have no great love of such state welfare schemes and desire their replacement by self-managed alternatives. For example, taking municipal housing, Colin Ward writes:

> "The municipal tenant is trapped in a syndrome of dependence and resentment, which is an accurate reflection of his housing situation. People care about what is theirs, what they can modify, alter, adapt to changing needs and improve themselves. They must have a direct responsibility for it . . . The tenant take-over of the municipal estate is one of those obviously sensible ideas which is dormant because our approach to municipal affairs is still stuck in the groves of nineteenth-century paternalism." [Anarchy in Action, p. 73]

Looking at state supported education, Ward argues that the "universal education system turns out to be yet another way in which the poor subsidise the rich." Which is the least of its problems, for "it is in the nature of public authorities to run coercive and hierarchical institutions whose ultimate function is to perpetuate social inequality and to brainwash the young into the acceptance of their particular slot in the organised system." [Op. Cit., p. 83 and p. 81] The role of state education as a means of systematically indoctrinating the working class is reflected in William Lazonick words:

> "The Education Act of 1870 . . . [gave the] state . . . the facilities . . . to make education compulsory for all children from the age of five to the age of ten. It had also erected a powerful system of ideological control over the next generation of workers . . . [It] was to function as a prime ideological mechanism in the attempt by the capitalist class through the medium of the state, to continually reproduce a labour force which would passively accept [the] subjection [of labour to the domination of capital]. At the same time it had set up a public institution which could potentially be used by the working class for just the contrary purpose." ["The Subjection of Labour to Capital: The rise of the Capitalist System", Radical Political Economy Vol. 2, p. 363]

Lazonick, as did Pateman, indicates the contradictory nature of welfare provisions within capitalism. On the one hand, they are introduced to help control the working class (and to improve long term economic development). On the other hand, these provisions can be used by working class people as weapons against capitalism and give themselves more options than "work or starve" (the fact that the attacks on welfare in the UK during the 1990s -- called, ironically enough, welfare to work -- involves losing benefits if you refuse a job is not a surprising development). Thus we find that welfare acts as a kind of floor under wages. In the US, the two have followed a common trajectory (rising together and falling together). And it is this, the potential benefits welfare can have for working people, that is the real cause for the current capitalist attacks upon it. As Noam Chomsky summarises:

> "State authority is now under severe attack in the more democratic societies, but not because it conflicts with the libertarian vision. Rather the opposite: because it offers (weak) protection to some aspects of that vision. Governments have a fatal flaw: unlike the private tyrannies, the institutions of state power and authority offer to the public an opportunity to play some role, however limited, in managing their own affairs." [Chomsky on Anarchism, p. 193]

Because of this contradictory nature of welfare, we find anarchists like Noam Chomsky arguing that (using an expression popularised by South American rural workers unions) "we should 'expand the floor of the cage.' We know we're in a cage. We know we're trapped. We're going to expand the floor, meaning we will extend to the limits what the cage will allow. And we intend to destroy the cage. But not by attacking the cage when we're vulnerable, so they'll murder us . . . You have to protect the cage when it's under attack from even worse predators from outside, like private power. And you have to expand the floor of the cage, recognising that it's a cage. These are all preliminaries to dismantling it. Unless people are willing to tolerate that level of complexity, they're going to be of no use to people who are suffering and who need help, or, for that matter, to themselves." [Expanding the Floor of the Cage]

Thus, even though we know the welfare state is a cage and part of an instrument of class power, we have to defend it from a worse possibility -- namely, the state as "pure" defender of capitalism with working people with few or no rights. At least the welfare state does have a contradictory nature, the tensions of which can be used to increase our options. And one of these options is its abolition from below!

For example, with regards to municipal housing, anarchists will be the first to agree that it is paternalistic, bureaucratic and hardly a wonderful living experience. However, in stark contrast with the right who desire to privatise such estates, anarchists think that "tenants control" is the best solution as it gives us the benefits of individual ownership along with community (and so without the negative points of property, such as social atomisation). The demand for "tenant control" must come from below, by the "collective resistance" of the tenants themselves, perhaps as a result of struggles against "continuous rent increases" leading to "the demand . . . for a change in the status of the tenant." Such a "tenant take-over of the municipal estate is one of those sensible ideas which is dormant because our approach to municipal affairs is still stuck in the grooves of nineteenth century paternalism." [Ward, Op. Cit., p. 73]

And it is here that we find the ultimate irony of the right-wing, "free market" attempts to abolish the welfare state -- neo-liberalism wants to end welfare from above, by means of the state (which is the instigator of this individualistic "reform"). It does not seek the end of dependency by self-liberation, but the shifting of dependency from state to charity and the market. In contrast, anarchists desire to abolish welfare from below. This the libertarian attitude to those government policies which actually do help people. While anarchists would "hesitate to condemn those measures taken by governments which obviously benefited the people, unless we saw the immediate possibility of people carrying them out for themselves. This would not inhibit us from declaring at the same time that what initiatives governments take would be more successfully taken by the people themselves if they put their minds to the same problems . . . to build up a hospital service or a transport system, for instance, from local needs into a national organisation, by agreement and consent at all levels is surely more economical as well as efficient than one which is conceived at top level [by the state] . . . where Treasury, political and other pressures, not necessarily connected with what we would describe as needs, influence the shaping of policies." So "as long as we have capitalism and government the job of anarchists is to fight both, and at the same time encourage people to take what steps they can to run their own lives." ["Anarchists and Voting", pp. 176-87, The Raven, No. 14, p. 179]

Ultimately, unlike the state socialist/liberal left, anarchists reject the idea that the cause of socialism, of a free society, can be helped by using the state. Like the right, the left see political action in terms of the state. All its favourite policies have been statist -- state intervention in the economy, nationalisation, state welfare, state education and so on. Whatever the problem, the left see the solution as lying in the extension of the power of the state. They continually push people in relying on others to solve their problems for them. Moreover, such state-based "aid" does not get to the core of the problem. All it does is fight the symptoms of capitalism and statism without attacking their root causes -- the system itself.

Invariably, this support for the state is a move away from working class people, from trusting and empowering them to sort out their own problems. Indeed, the left seem to forget that the state exists to defend the collective interests of the ruling class and so could hardly be considered a neutral body. And, worst of all, they have presented the right with the opportunity of stating that freedom from the state means the same thing as the freedom of the market (so ignoring the awkward fact that capitalism is based upon domination -- wage labour -- and needs many repressive measures in order to exist and survive). Anarchists are of the opinion that changing the boss for the state (or vice versa) is only a step sideways, not forward! After all, it is not working people who control how the welfare state is run, it is politicians, "experts", bureaucrats and managers who do so ("Welfare is administered by a top-heavy governmental machine which ensures that when economies in public expenditure are imposed by its political masters, they are made in reducing the service to the public, not by reducing the cost of administration." [Ward, Op. Cit. p. 10]). Little wonder we have seen elements of the welfare state used as a weapon in the class war against those in struggle (for example, in Britain during the miners strike in 1980s the Conservative Government made it illegal to claim benefits while on strike, so reducing the funds available to workers in struggle and helping bosses force strikers back to work faster).

Anarchists consider it far better to encourage those who suffer injustice to organise themselves and in that way they can change what they think is actually wrong, as opposed to what politicians and "experts" claim is wrong. If sometimes part of this struggle involves protecting aspects of the welfare state ("expanding the floor of the cage") so be it -- but we will never stop there and will use such struggles as a stepping stone in abolishing the welfare state from below by creating self-managed, working class, alternatives. As part of this process anarchists also seek to transform those aspects of the welfare state they may be trying to "protect". They do not defend an institution which is paternalistic, bureaucratic and unresponsive. For example, if we are involved in trying to stop a local state-run hospital or school from closing, anarchists would try to raise the issue of self-management and local community control into the struggle in the hope of going beyond the status quo.

In this, we follow the suggestion made by Proudhon that rather than "fatten certain contractors," libertarians should be aiming to create "a new kind of property" by "granting the privilege of running" public utilities, industries and services, "under fixed conditions, to responsible companies, not of capitalists, but of workmen." Municipalities would take the initiative in setting up public works but actual control would rest with workers' co-operatives for "it becomes necessary for the workers to form themselves into democratic societies, with equal conditions for all members, on pain of a relapse into feudalism." [General Idea of the Revolution, p. 151 and p. 276-7] Thus, for example, rather than nationalise or privatise railways, they should be handed over workers' co-operatives to run. The same with welfare services and such like: "the abolition of the State is the last term of a series, which consists of an incessant diminution, by political and administrative simplification the number of public functionaries and to put into the care of responsible workers societies the works and services confided to the state." [Proudhon, Carnets, vol. 3, p. 293]

Not only does this mean that we can get accustomed to managing our own affairs collectively, it also means that we can ensure that whatever "safety-nets" we have do what we want and not what capital wants. In the end, what we create and run by ourselves will be more responsive to our needs, and the needs of the class struggle, than reformist aspects of the capitalist state. This much, we think, is obvious. And it is ironic to see elements of the "radical" and "revolutionary" left argue against this working class self-help (and so ignore the long tradition of such activity in working class movements) and instead select for the agent of their protection a state run by and for capitalists!

There are two traditions of welfare within society, one of "fraternal and autonomous associations springing from below, the other that of authoritarian institutions directed from above." [Ward, Op. Cit., p. 123] While sometimes anarchists are forced to defend the latter against the greater evil of "free market" capitalism, we never forget the importance of creating and strengthening the former. As Chomsky suggests, libertarians have to "defend some state institutions from the attack against them [by private power], while trying at the same time to pry them open to meaningful public participation -- and ultimately, to dismantle them in a much more free society, if the appropriate circumstances can be achieved." [Chomsky on Anarchism, p. 194] A point we will discuss more in the next section when we highlight the historical examples of self-managed communal welfare and self-help organisations.

## J.5.16 Are there any historical examples of collective self-help?

Yes, in all societies we see working class people joining together to practice mutual aid and solidarity. This takes many forms, such as trade and industrial unions, credit unions and friendly societies, co-operatives and so on, but the natural response of working class people to the injustices of capitalism was to practice collective "self-help" in order to improve their lives and protect their friends, communities and fellow workers.

There are, as Colin Ward stresses, "in fact several quite separate traditions of social welfare: the product of totally different attitudes to social needs . . . One of these traditions is that of a service given grudgingly and punitively by authority, another is the expression of social responsibility, or of mutual aid and self-help. One is embodied in institutions, the other in associations." [Anarchy in Action, p. 112] Anarchists, needless to say, favour the latter. Unfortunately, this "great tradition of working class self-help and mutual aid was written off, not just as irrelevant, but as an actual impediment, by the political and professional architects of the welfare state . . . The contribution that the recipients had to make to all this theoretical bounty was ignored as a mere embarrassment -- apart, of course, for paying for it . . . The socialist ideal was rewritten as a world in which everyone was entitled to everything, but where nobody except the providers had any actual say about anything. We have been learning for years, in the anti-welfare backlash, what a vulnerable utopia that was." This self-managed working class self-help was the "welfare road we failed to take." [Ward, Social Policy: an anarchist response, p. 11-2 and p. 9]

Anarchists would argue that self-help is the natural side effect of freedom. There is no possibility of radical social change unless people are free to decide for themselves what their problems are, where their interests lie and are free to organise for themselves what they want to do about them. Self-help is a natural expression of people taking control of their own lives and acting for themselves. Anyone who urges state action on behalf of people is no socialist and any one arguing against self-help as "bourgeois" is no anti-capitalist. It is somewhat ironic that it is the right who have monopolised the rhetoric of "self-help" and turned it into yet another ideological weapon against working class direct action and self-liberation (although, saying that, the right generally likes individualised self-help -- given a strike, squatting or any other form of collective self-help movement they will be the first to denounce it):

> "The political Left has, over the years, committed an enormous psychological error in allowing this kind of language ["self-help", "mutual aid", "standing on your own two feet" and so on] to be appropriated by the political Right. If you look at the exhibitions of trade union banners from the last century, you will see slogans like Self Help embroidered all over them. It was those clever Fabians and academic Marxists who ridiculed out of existence the values by which ordinary citizens govern their own lives in favour of bureaucratic paternalising, leaving those values around to be picked up by their political opponents." [Ward, Talking Houses, p. 58]

We cannot be expected to provide an extensive list of working class collective self-help and social welfare activity here, all we can do is present an overview of collective welfare in action (for a discussion of working class self-help and co-operation through the centuries we can suggest no better source than Kropotkin's Mutual Aid). In the case of Britain, we find that the "newly created working class built up from nothing a vast network of social and economic initiatives based on self-help and mutual aid. The list is endless: friendly societies, building societies, sick clubs, coffin clubs, clothing clubs, up to enormous federated enterprises like the trade union movement and the Co-operative movement." [Ward, Social Policy, pp. 10-1] The historian E.P. Thompson confirmed this picture of a wide network of working class self-help organisations. "Small tradesmen, artisans, labourers" he summarised, "all sought to insure themselves against sickness, unemployment, or funeral expenses through membership of . . . friendly societies." These were "authentic evidence of independent working-class culture and institutions . . . out of which . . . trade unions grew, and in which trade union officers were trained." Friendly societies "did not 'proceed from' an idea: both the ideas and institutions arose from a certain common experience . . . In the simple cellular structure of the friendly society, with its workaday ethos of mutual aid, we see many features which were reproduced in more sophisticated and complex form in trade unions, co-operatives, Hampden clubs, Political Unions, and Chartist lodges . . . Every kind of witness in the first half of the nineteenth century -- clergymen, factory inspectors, Radical publicists -- remarked upon the extent of mutual aid in the poorest districts. In times of emergency, unemployment, strikes, sickness, childbirth, then it was the poor who 'helped every one his neighbour.'" [The Making of the English Working Class, p. 458, pp. 460-1 and p. 462] Sam Dolgoff gave an excellent summary of similar self-help activities by the American working class:

> "Long before the labour movement got corrupted and the state stepped in, the workers organised a network of co-operative institutions of all kinds: schools, summer camps for children and adults, homes for the aged, health and cultural centres, credit associations, fire, life, and health insurance, technical education, housing, etc." [The American Labour Movement: A New Beginning, p. 74]

Dolgoff, like all anarchists, urged workers to "finance the establishment of independent co-operative societies of all types, which will respond adequately to their needs" and that such a movement "could constitute a realistic alternative to the horrendous abuses of the 'establishment' at a fraction of the cost." [Op. Cit., p. 74 and pp. 74-75] In this way a network of self-managed, communal, welfare associations and co-operatives could be built -- paid for, run by and run for working class people. Such a system "would not . . . become a plaything of central government financial policy." [Ward, Op. Cit., p. 16] Such a network could be initially build upon, and be an aspect of, the struggles of both workers in and claimants, patients, tenants, and other users of the current welfare state. So a "multiplicity of mutual aid organisations among claimants, patients, victims, represents the most potent lever for change in transforming the welfare state into a genuine welfare society, in turning community care into a caring community." [Ward, Anarchy in Action, p. 125]

The creation of such a co-operative, community-based, welfare system will not occur over night, nor will it be easy. But it is possible, as history shows. It will, of course, have its problems, but as Colin Ward notes, "the standard argument against a localist and decentralised point of view, is that of universalism: an equal service to all citizens, which it is thought that central control achieves. The short answer to this is that it doesn't!" [Colin Ward, Social Policy, p. 16] He notes that richer areas generally get a better service from the welfare state than poorer ones, thus violating the claims of equal service. A centralised system (be it state or private) will most likely allocate resources which reflect the interests and (lack of) knowledge of bureaucrats and experts, not on where they are best used or the needs of the users.

Anarchists are sure that a confederal network of mutual aid organisations and co-operatives, based upon local input and control, can overcome problems of localism far better than a centralised one -- which, due to its lack of local input and participation will more likely encourage parochialism and indifference than a wider vision and solidarity. If you have no real say in what affects you, why should you be concerned with what affects others? This is unsurprising, for what else is global action other than the product of thousands of local actions? Solidarity within our class is the flower that grows from the soil of our local self-activity, direct action and self-organisation. Unless we act and organise locally, any wider organisation and action will be hollow. Thus local organisation and empowerment is essential to create and maintain wider organisations and mutual aid.

To take another example of the benefits of a self-managed welfare system, we find that it "was a continual complaint of the authorities" in the late eighteenth and early nineteenth century "that friendly societies allowed members to withdraw funds when on strike." [Thompson, Op. Cit., p. 461f] The same complaints were voiced in Britain about the welfare state allowing strikers to claim benefit will on strike. The Conservative Government of the 1980s changed that by passing a law barring those in industrial dispute to claim benefits -- and so removing a potential support for those in struggle. Such a restriction would have been far harder (if not impossible) to impose on a network of self-managed mutual aid co-operatives. Such institutions would have not become the plaything of central government financial policy as the welfare state and the taxes working class people have to pay have become.

All this means that anarchists reject the phoney choice between private and state capitalism we are usually offered. We reject both privatisation and nationalisation, both right and left wings (of capitalism). Neither state nor private health care are user-controlled -- one is subject to the requirements of politics and the other places profits before people. As we have discussed the welfare state in the last section, it is worthwhile to quickly discuss privatised welfare and why anarchists reject this option even more than state welfare.

Firstly, all forms of private healthcare/welfare have to pay dividends to capitalists, fund advertising, reduce costs to maximise profits by standardising the "caring" process - i.e. McDonaldisation - and so on, all of which inflates prices and produces substandard service across the industry as a whole. According to Alfie Kohn, "[m]ore hospitals and clinics are being run by for-profit corporations; many institutions, forced to battle for 'customers,' seem to value a skilled director of marketing more highly than a skilled caregiver. As in any other economic sector, the race for profits translates into pressure to reduce costs, and the easiest way to do it here is to cut back on services to unprofitable patients, that is, those who are more sick than rich . . . The result: hospital costs are actually higher in areas where there is more competition for patients." [No Contest, p. 240] In the UK, attempts to introduce "market forces" into the National Health Service has also lead to increased costs as well as inflating the size and cost of its bureaucracy.

Looking at Chile, hyped by those who desire to privatise Social Security, we find similar disappointing results (well, disappointing for the working class at least, as we will see). Seemingly, Chile's private system has achieved impressive average returns on investment. However, once commissions are factored in, the real return for individual workers is considerably lower. For example, although the average rate of return on funds from 1982 through 1986 was 15.9 percent, the real return after commissions was a mere 0.3 percent! Between 1991 and 1995, the pre-commission return was 12.9 percent, but with commissions it fell to 2.1 percent. According to Doug Henwood, the "competing mutual funds have vast sales forces, and the portfolio managers all have their vast fees. All in all, administrative costs . . . are almost 30% of revenues, compared to well under 1% for the U.S. Social Security system." [Wall Street, p. 305] In addition, the private pension fund market is dominated by a handful of companies.

Even if commission costs were lowered (by regulation), the impressive returns on capital seen between 1982 and 1995 (when the real annual return on investment averaged 12.7 percent) are likely not to be sustained. These average returns coincided with boom years in Chile, complemented by government's high borrowing costs. Because of the debt crisis of the 1980s, Latin governments were paying double-digit real interest rates on their bonds -- the main investment vehicle of social security funds. In effect, government was subsidising the "private" system by paying astronomical rates on government bonds. Another failing of the system is that only a little over half of Chilean workers make regular social security contributions. While many believe that a private system would reduce evasion because workers have a greater incentive to contribute to their own personal retirement accounts, 43.4 percent of those affiliated with the new system in June of 1995 did not contribute regularly. [Stephen J. Kay, "The Chile Con: Privatizing Social Security in South America," The American Prospect no. 33, pp. 48-52] All in all, privatisation seems to be beneficial only to middle-men and capitalists, if Chile is anything to go by. As Henwood argues, while the "infusion of money" resulting from privatising social security "has done wonders for the Chilean stock market" "projections are that as many as half of future retirees will draw a poverty-level pension." [Henwood, Op. Cit., pp. 304-5]

Suffice to say, all you really need to know about privatisation of pensions and healthcare in Chile is that the military dictatorship which imposed it excluded the military from its dubious benefits. Such altruism is truly touching.

So, anarchists reject private welfare as a con (and an even bigger one than state welfare). As Colin Ward suggests, it "is the question of how we get back on the mutual aid road instead of commercial health insurance and private pension schemes." [Social Policy, p. 17] As anarchists are both anti-state and anti-capitalist, swapping private power for the state power is, at best, a step sideways. Usually, it is worse for capitalist companies are accountable only to their owners and the profit criteria. This means, as Chomsky suggests, "protecting the state sector today is a step towards abolishing the state because it maintains a public arena in which people can participate and organise, and affect policy, and so on, though in limited ways. If that's removed, we'd go back to a . . . private dictatorship, but that's hardly a step towards liberation." [ Chomsky on Anarchism, p. 213] Instead anarchists try to create real alternatives to hierarchy, be it state or capitalist, in the here and now which reflect our ideas of a free and just society. For, when it boils down to it, freedom cannot be given, only taken and this process of self-liberation is reflected in the alternatives we build to help win the class war.

The struggle against capitalism and statism requires that we build for the future and, moreover, we should remember that "he who has no confidence in the creative capacity of the masses and in their capability to revolt doesn't belong in the revolutionary movement. He should go to a monastery and get on his knees and start praying. Because he is no revolutionist. He is a son of a bitch." [Sam Dolgoff, quoted by Ulrike Heider, Anarchism: left, right, and green, p. 12]