From the LeftLibertarian mailing list, Kevin Carson summarizes a key element of his economic and political philosophy that I think some don't grasp: mutualism endeavors to describe an individual's natural and self-directed patterns of production and consumption.
...the main thing is that when some significant level of productive labor is required, there is need for equating the disutility of the labor of production with the utility of the good consumed. As a market socialist in the old individualist anarchist tradition, I believe that economic privilege has destabilizing effects on capitalism precisely because it breaks the link between effort expended and consumption. It shifts part of the laborer's rightful product to a rentier, so that the laborer has to produce more than he otherwise would to achieve a given level of consumption, while the rentier's superfluous income unconnected to effort piles up (see also J.A. Hobson). With the kind of market price mechanism the old free market anti-capitalist envisioned, labor's wage would be its full product and would tie effort and consumption together, thus preventing destabilizing crises of overproduction/underconsumption. And these observations don't require a crude economic man model. They simply presume that, no matter how much the laborer enjoys his work, the enjoyment will probably reach the point of diminishing returns before he produces the equivalent of what he consumes. And on the other hand, people will be just a little less constrained in their consumption when it isn't tied to the exchange of their own labor.
Without acknowledging this central argument of mutualism, many critiques fail to address the heart of the philosophy. This vital balance between consumption and production that is irreducibly struck within the individual's purposeful actions comprises the bread and butter of mutualist thought. Criticize the economic models and historical scholarship of Carson if you must; but to ignore the assertion of a natural, intuitive equilibrium is really to miss the point, regardless of whether or not you think that point is correct.
So one can see why mutualists insist upon the labor theory of value. It is not, in fact, some devious plot to introduce creeping statism. When the market is seen as a way of balancing individual production and consumption over the long run, it is the labor theory that informs the long term workings of the political economy best. In the short term, where immediate market conditions demand explanation, it is the subjective theory of value that fits best (which not only Carson, but other labor theorists have conceded). It really comes down to which dynamics of human behavior do you want to explain over what period of time - not which view is absolutely right and which is absolutely mistaken! The true fear of the vulgar capitalist libertarian is that the market might be the best way of achieving an egalitarian balance between consumption and production - far better than the easy target of the socialist state.
Many self-described libertarians take dramatic issue with a balance between production and consumption in order to preserve a fairy tale version of capitalism's rise and the glorious concentrations of wealth it promotes (usually along with a very tired and narrow definition of "progress"). After all, if one generally accepts the myth of elitism and social darwinism, then there's only so much one can attack in the current corporatist order. It is precisely that idiosyncratic and, in some senses, arbitrary choice of how to view history, what to emphasize, and what to downplay that, in my opinion, separates the mutualist from the more standard right-wing libertarian or anarcho-capitalist. Such a choice encourages a preoccupation, for example, with Soviet seizure of farmland while ignoring the very aristocratic cum capitalist British enclosure movement (see Stromberg).
In some cases it truly boggles my mind how ridiculously petty this puerile insistence on orthodox subjectivist economic philosophy (and all attendant vulgarities) is. If markets have indeed been a lynchpin of human society and social progress since the advent of civilization, the idea that there is only one way to view the market denies the historical record and the complexity of human nature. I do believe that one day both the labor and subjective theories of value will be acknowledged - not just as distinct economic methodologies, but rather as complementary models of human behavior.
I've mentioned this idea about divergent histrionics to my friends Jim and Brady in my discussions of mutualism with them, and hopefully I can ramp up my thinking and writing sufficiently to address this issue with the attention their gracious interest deserves.
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