on free trade

I just finished reading John Michael Greer’s post “The Free Trade Fallacy” from last November, and it got me intrigued.

As a libertarian, I usually face the charges Greer puts forth: if goods and capital can flow freely through borders, some countries will be much better at the expense of their populace and of other countries. Hardly, though, with such clarity as Greer’s. So much that I think merits at least a response (even if mine is not very brilliant).

A couple caveats before we get into the argument itself:

  1. I think nations should, in fact, enter voluntarily into free trade agreements, and never if they perceive this is bad for their interests. I am completely against an “Open Door Empire” that violently imposes unilateral “trade agreements” on its in fact subject nations.
  2. I am specifically countering JMG’s assertion that free trade, per se, without further intervention policies from the State, is cause of working-class poverty, wealth concentration and economic crises. I will argue solely that no, free trade alone does not cause those things – and I’ll leave open the reasons why such things happened when there were “free trade waves” (if reading is of interest, my main source here is Kevin Carson, his books cover most of the historical arguments I’d make).

The flesh of Greer’s argument is here:

When there are no trade barriers, the nation that can produce a given good or service at the lowest price will end up with the lion’s share of the market for that good or service. Since labor costs make up so large a portion of the cost of producing goods, those nations with low wages will outbid those with high wages, resulting in high unemployment and decreasing wages in the formerly high-wage countries. The result is a race to the bottom in which wages everywhere decline toward those of the worst-paid labor force in the free trade zone.

Well, certainly, those suppliers that offer the smallest price (and keep the biggest profit) will get the lion’s share of their market. They will most assuredly look for the lowest labor costs possible – given all other factors – and will choose the bundle of factors of production that yield the smallest price at the biggest profit.

Now, if a nation has high-wages, it will (sometimes) lose companies and thus jobs to nations with lower wages. But it will get cheaper products. This means that, even if nominal wages fall, real wages (purchase power) will either remain the same or even increase (because cheaper imports).

Also, if a nation chooses to keep their nominal wages, it will mean unemployment. But otherwise, if they lower their nominal wages, unemployment won’t be an issue, unless it is a nation that can produce nothing at all, which is clearly absurd.

As capital moves to these configurations that yield smallest prices and biggest profits, and wages adjust accordingly, it is probable much more material wealth is produced and distributed widely. Little by little, amongst nation there evolves a specialization of labor, similar to the one that happen inside those nations, among individuals.

The mismatch between purchase power and capital investment that Greer identifies will only happen if real wages are lowered. And that demands something more than plain free trade.

neocameralist scrap note #1

so, since I’ve been to embroiled in other stuff for far too long to actually finish the longer posts I have in mind, I’ll sketch a little thingummy here. this is mostly chaotic patching up, be warned.

first, priors: read these:

Neocameralism #1
Eight-Point Neo-Cam
Trichotomocracy
Casino Royale
Meta-Neocameralism
The Odysseus Problem
A Republic, If You Can Keep It
Quibbles with Moldbug

also, my previous discussions here, here and here.

in Land’s writing, I find these to be the essential pieces on Neocameralism. from top to bottom you get an ever increasing abstraction of the problem at hand. Under this techno-commercial view, a Neocameral state is a decentralized shareholder-managed republic.

to view this – and how the whole “absolutist monarchy” thing is more old-fashioned Throne-and-Altar reaction than libertarian-oriented NRx – you have first to think the original and fundamental role of a parliament: to control the king’s/executive’s budget. under neocameralism, this is formalized as the board of trustees, elected by the shareholders. shareholders have their votes in proportion to shares, which give them specific rights to dividends and/or profits, plus this minimal voice in the choice of management. this board of trustees/parliament overviews management’s/king’s accounting, by determining how much money gets invested in the sovcorp. much exit, minimal voice.

the CEO – which is a sort of elective, rather than dynastic, king – is appointed by this board of trustees. could it be otherwise? possibly. but choosing the best administrator usually means not following bloodlines or whatever. in appointing the CEO, as well, the board of trustees evinces it’s character of ultimate controller, or proprietor, of the sovcorp. the CEO can decide management policies, hire personnel, distribute its budget as she pleases. but ultimately, she has to turn a profit and pay dividends. otherwise shareholders flee, or simply remove her from office.

what’s been sketched so far are the legislative and executive powers in a republic. I believe Land’s main point in enphasizing so easgerly that neocameralism is more compatible with republican than monarchical tradition, is to show how the corporative structure present in most corporations are precisely isomorphical to those of a well-regulated republic. which is to say, an efficient feedback circuit.

nonetheless, for the feedback circuit to close, there’s yet a third power: judiciary. this is probably the most complicated, since it touches precisely in the central critique of NRx: justice, even as a power, depends on mind-control/morality. there’s much more to be said about this intellectual side of justice-systems, but let’s leave it for another occasion. my concern here is: how is justice, as a power, to be formalized under a neocameralist republic?

the answer seems to lie in common-law systems. private law, in short. the sovcorp provides the service of sovereign property, i. e., effective defense against external threat. in being so, it’s justice system can be privatized to competing judiciary agencies. the whole ancap thing: security agencies, police companies and private courts, with operations agreed by contract with their clients. the sovcorp duty to these companies – as well as to all others – is to make sure they don’t resort to violence amongst each other.

so, there is a sovereign justice system as well: a final court of appeal in the for of the sovcorp’s management (within whichever specific department it decides to charge with such duties). which was the king’s/executive’s role in most constitutional systems. (if I’m not mistaken, that’s even what Montesquieu proposes.)

justice, as a power, then, is placed in the hands of the market and this market will control the decisions of shareholders, to the extent that it’s their willingness to stay within the sovcorp’s territory and pay it’s fees that will turn a profit.

thus the circuit closes: shareholders elect board of trustees that control management -> management enact policies that increase or decrease the value of the sovereign property, according to the response of an internal market, thus controlling it -> this internal market, in it’s decision to remain or exit the territorial bounds of the sovcorp (and thus pay fees and make profit possible), controls the shareholders decisions. this is the ideal feedback circuit within a (non-democratic) republican system – and it’s the ideal feedback circuit within a neocameral sovcorp. it is this feedback circuit that ensures dynamic stability, in a systematic learning/discovery process (that can be automatized – but that’s already another post).

we can try and push this sketch model, to test it and possibly break it, and then improve it. nothing that can’t utterly fail can teach anything, after all.

A Statement of Principles

[the post below has been written in 2013 and posted originally here. my objective in translating and posting it here is to review and add criticism to my own past views. the original translated text will be unmarked, the new remarks will be in bold between square brackets.]

For my debut article in this blog, I would like to draft the philosophical, political, and economic principles that guide my analysis of society, and that will pervade my writing in future articles. Criticism, corrections, debate and of course compliments are very welcome.

Liberty and Equality

The twin concepts of Liberty and Equality are the central tenets of my world view, which might be described as market socialism, left-libertarianism, or individualist anarchism, since these names have been used throughout history for roughly the same set of principles I am about to lay out here.

[Of those names, I would only keep “individualist anarchism”. Libertarianism is, of course, intrinsically left-wing in most if not all social contexts (America probably being the only exception). But it’s not intrinsically realist, as I take the individualist anarchists to have been (in stark contrast to the other anarchist segments), such that I would adopt only this label to myself. “Market socialism” is a contradiction in terms, only useful as viral strategy to infect the brahmin socialists with the market meme, or for irony.]

Liberty is to be understood as the ability and right of all sentient beings to dispose of their persons and the fruits of their labor, and nothing else, as they see fit. This stems from their self-awareness and their ability to control and choose the content of their actions.

[I like the way this definition seeks to equate right  to ability. This pragmatist stance towards morality is something I grew to find most respectable. It is the very ability to control their actions that grant individuals their right to dispose of the products of their own labor. It’s a true might producing a right. A cybernetic principle, present originally in individualist anarchism: internalize costs (close the loop).  Consequences accrue to the motors. Lack of control equals the loss of the right.]

Equality is to be understood as the state of no imbalance of power, that is, of no subjection to another sentient being. This stems from their universal ability for empathy, and from their equal ability for reason.

[Here my main reference is Long’s undying article on Equality. As he shows there, there is an essential affirmation of equality in the core of liberty (as pragmatically defined above). Not merely a formal equality, nor an equality of wealth or income, but an equality of power (in Proudhon’s wording: an equality of conditions). It’s only among beings of equal standing, where one cannot possibly subjugate the other, that liberty in fact exists. If liberty is to be established, this is the equality one has to pursue. No moral code is going to solve that if, in reality, such equality doesn’t exist. As all things, liberty has to be technically produced. All else is little more than idle babble.]

It is important to notice that, contrary to usual statements of these two principles, my standpoint is that Liberty and Equality here are not merely compatible, meaning they could coexist in some possible universe, but rather they are two sides of the same coin, complementary and interdependent. There can be NO Liberty where there is no Equality, for the imbalance of power, the state of subjection, will render sentient beings unable to dispose of their persons and the fruits of their labor[1], and it will limit their ability to choose over their rightful jurisdiction. Likewise, there can be NO Equality without Liberty, for restraining sentient beings’ ability to choose and dispose of their persons and fruits of labor will render some more powerful than the rest, and establish a state of subjection.

Social and personal order and peace depend entirely on the maintenance of these principles. The breach of either Liberty or Equality results in suffering, insanity, bloodshed, waste and misery, as History will promptly show us. It leads to the withering of empathy, the establishment of classes (and the associate class warfare), hierarchy and slavery. It’s no coincidence that these principles have constantly been associated to Justice and Goodness, for there can be none of these without them.

[The general do-gooder tone is rather annoying, I know. But the statements are not incorrect: where there is no actual  equality of power (and thus liberty), there are uncontrolled power-nodes, usually in homeostatic balance, but eventually engaging in destructive escalations of violence. Most importantly, where there isn’t liberty (internalization of costs and benefits), productivity dwindles, and so does survival capabilities. It’s no surprise individualists usually win wars.]

Mutualism and Individualism

The maintenance of Liberty and Equality, central as they are to the welfare and integrity of sentient beings in a society, depends heavily on the organization of such society and the kind of relations undertaken within it. Two organizational and ethical systems most consistently embody, in my opinion, the principles of Liberty and Equality, namely Mutualism and Individualism.

[This much is already established by the very definitions in the section above. Liberty is built upon an Equality that demands production. Social organization for said production is an important issues. Some interesting linkage on the topics of mutualism, reciprocal altruism, and individualism might be useful.]

By Mutualism, I am referring to the social organization defended by the political school of thought pioneered by Pierre-Joseph Proudhon and later taken further by Benjamin Tucker and the other individualist anarchists. Mutualism is characterized by relations in which equal parties voluntarily and reciprocally provide one another with the fruits of their own labor. Being voluntary and equal exchanges, these relations are by definition both mutually beneficial and non-exploitative. Institutions in Mutualism are horizontal, participatory, and democratic by nature in virtue of the relations within them. Examples of mutualist institutions include the Federation described by Proudhon in his work, as well mutual banks and other mutual aid organizations, friendly societies, commons, commerce, cooperatives, peer-to-peer networks, and any other in which the participants join voluntarily and as equals. The 19th century communist motto very fairly describes the spirit of Mutualism too: “From each according to their abilities, to each according to their needs”.

[The similarity of mutualism and hbdchick’s individualism-collectivism is incredible. As explicit from the links above, mutualism is merely reciprocal altruism.

From this section, though, I would remove the “participatory and democratic” as features of mutualism. Mutualism is interactive rather than participatory, i. e., it relies more on spontaneous (unplanned for) interaction between individuals than the participation in some kind of institution. Mostly the point is: you don’t have to be anywhere, vote for anything etc. to do something between consenting partners. Democratic is also misleading. The correct term, as described below is decentralized. It’s democratic only insofar as each person takes care of their own life (being thus “a (self) government of the people (individually) by the people (individually)).

Also, scrape the communist motto if it’s not saying “everyone is getting what they produce”, i. e., cost internalization. In fact, everything any individualist anarchist/mutualist ever wrote can be summarized as “internalize costs”.]

Individualism is the social ethos by which every individual sentient being in a society is recognized as unique and irreplaceable, as having their own private goals and desires and therefore as an end in themselves. It affirms that the individual is the fundamental building block of the larger organism that is society, and hence that all analysis of such society must take them as its starting point. It holds sacred that every individual has the ability, right, and duty to choose their own goals independently, and is autonomously able to pursue them, with respect to every others’ equal right. It can be found as a guiding principle in many religious beliefs and philosophical doctrines, but I find it rather exquisitely expressed by the Wiccan Rede: “An it harm none, do as thou wilt”.

[The Thelema is probably better suited: Do what thou wilt shall be the whole of the Law (see here). There is very little I would change in this section. Probably the only thing worth mentioning is that all these beliefs are instrumental in building a working free society. I don’t actually believe “individuals” to be any more stable wholes than cities or cells. This article by Shawn Wilbur probably covers most of the important proudhonian reasoning behind my views.]

Thus, Individualism explicitly informs society that every individual will pursue their own purposes, and Mutualism guarantees individuals will have the ability to make such purposes beneficial to themselves and to society, through free trade and equal exchange. Individualism gives individuals the reason and the weapons to resist when hierarchy arises, and Mutualism assures society has the ability to organize such resistance.

Mutualism and Individualism so stand in dynamic equilibrium, expliciting the tension between personal and social interests, and making it possible for such tension to be resolved peacefully, with the best possible results for both the individuals and their comrades. They both together provide society with the will to mutually help and the acknowledgement of the infinite, unique contribution of its members.

[The humanistic undertone is killing me. But the essential idea is there: society is a being made of parts (just like individuals). It only functions insofar as its parts can freely adapt to its environment and function properly. This demands freedom (movement). Individualism is the “internal rule” of a working (free) society. Do your thing, and we see if it works.]

Decentralization and Skepticism

[This is the section I originally was hesitant about writing, and now I’m grateful I have, because it’s precisely the point of connection with most of my current views. Here is the base of the techno-scientific infrastructure that make any of the above principles or social organizations possible at all. Without this, everything else said this far is rendered moot.]

Societies can be viewed as systems of information flow, in which knowledge needs to be acquired by individuals in order to better decide about their living, both personally and socially. For a society to be organized through Mutualism and Individualism, the acquisition of knowledge to make decisions need be performed through Decentralized means, at the social level, and through a fair layer of Skepticism at the individual level.

At the social level, Decentralism holds that those agents closest to the actions and events taking place at a certain location are the ones in the best position, with the best available knowledge to decide about those actions and events. Because individuals only have a small fraction of the whole knowledge owned collectively, decisions should not be made by central authorities, small in number and knowledge, far removed from the place where such decisions will take effect. Decentralism holds that individuals can manage to decide locally, and that mechanisms of spontaneous, emergent orders, arising from the voluntary and equal exchanges described above, will synchronize local and personal knowledge, ultimatelty leading to the harmonization of the several individual objectives in society. In short, Decentralism is Mutualism applied to knowledge acquisition.

[I should have said merely “blockchain everything”.]

At the individual level, Skeptcism[2] asserts the uncertainty and limitations of knowledge, and holds that every new belief must be well supported by evidence and logical arguments convincing enough to individuals before being incorporated into their set of beliefs. In other words, it holds that individuals should not alter their goals and principles except in face of hard evidence to the contrary. Thus, it demands a questioning attitude towards knowledge, facts, or opinions, as well as doubt regarding claims that are usually taken for granted. In short, Skepticism is the Individualist postion towards knowledge.

[“Distrust, and test, test, test … to destruction wherever possible.” as Nick Land puts it.]

Conclusion: Anarchy and Markets

These six principles I have laid out, if followed consistently, advocate for a specific political-economic system usually referred to as market anarchism.

[Should have said “produce… market anarchism”.]

Anarchism is the political system under which political institutions are voluntary and self-governed. It opposes hierarchical organization and authority, thus making anarchist institutions within non-hierarchical free associations of free individuals. It’s characterized by the absolute absence of privilege and coercion, as well as a deep sense of anti-violence[3].

[Hierarchy as an emergent phenomenon – the fact that some people will eventually lead, and others will follow – is inherent in markets, where differences of competence can fully express themselves. If anarchy demands the active extirpation of hierarchy defined this way, it is in a hell of a bad position. Mostly because you cannot abolish this kind of hierarchy without creating the other, much worse kind of hierarchy as holiness, purity and immutable authority. If you suppress bottom-up, spontaneous hierarchy, you create top-down, centralized hierarchy. Even in 2013 I was well aware of that, and here, though I do not clarify this point, I already advocated for the first type of hierarchy against the second. The boundaries, I see now, are way less clear (is military competence included in spontaneous hierarchy?), but I gravitate always towards decentralization and the multiplication of forces

This certainly leads to retreat from the anti-violence thing there. Conflict is inherent in anything that works. The only reduction of violence a pragmatist libertarian can wish for is a reduction of waste (an increase in productive efficiency).

This two points, spontaneous hierarchy and conflict as productive, if stapled together, points to a very hard to swallow concept of freedom: freedom is not for everyone, but only for those who can assert themselves as possessors of productive power (and thus of exit). No one is going to give you anything for free. All individuals are inherently competitors, and only occasionally cooperators. Everybody lies, and everybody will try to get advantage out of you. If you don’t bite back, they will tread on you. And it’s only this fanged freedom in the hobbesian jungle of reality, this unrestrained competition that produces liberty as a right: when people are efficient enough, they become equals and their (effective, defensible) withdrawal is expected if less than full respect is shown to their right over their own labor.

Put this way, anarchy is both the beginning and the end of reality.]

Market economy is the economic system under which goods and services are freely produced and distributed, as opposed to a planned or regulated economy, such as the current one. In such system, fluctuations of price are determined by supply and demand, and in the long run, the prices of freely reproducible goods and services tend to reflect the labor-value embodied in them. And, as the individualist anarchists held, the natural wage of labor in such a system is its full product, no tributes paid to bureaucrats, landlords or capitalists.

[Okay, the labour-theory of value is in no way an economic consensus. Much less in the subjectivist stance adopted by Kevin Carson in his seminal book Studies in Mutualist Political Economy. I will try and dig out some way of showing that, even though marginalism has shown itself to be very predictive, versatile and mostly true scientific theory, subjective LTV has got some deep cybernetic insights, and that it may be plugged it into the marginalist mainstream, without major losses. To advance a brief and fundamental point while we’re at it, the last sentence in the paragraph above knits it nicely: if all costs and benefits are internalized in the productive unit, the input of energy over a certain period of time (work) is the quantity that predicts most linearly the output (production). 

Internalization of costs is the whole of acceleration.]

In my social analysis, the closer a society is to such system, the more fully will it embrace and enjoy those principles, and vice-versa. The transition strategies from our current statist and oppressive society, to the one envisioned in this article is way beyond the scope here. But adopting and acting according to the principles above, and advancing market anarchy in any way possible is the only manner to enjoy the benefits and the dignity they provide.

[The most bleakest ending paragraph ever written. “Do good and it all will end well”. No shit, Sherlock. The question is: how do you do good? I will explore more of that in coming texts, but once again: blockchain everything.]

Notes

[1] Although by no means do they lose their right to liberty, which is a normative fact inherent to their condition as sentient beings.

[2] The definition I use here is a general understanding of Skepticism as a questioning attitude, as opposed to blind faith and easy acceptance. It’s fundamentally different from Cartesian methodological doubt, and related but more allowing than Humean empiricism. My epistemological approach might be better described as within the coherentist label, under which the truth of a new propostion is to be probed against the individual’s set of beliefs, and will required ever more evidence and logical arguments to be incorporated as more central it is to that belief set. I include logical arguments (and other deductive knowledge) as well as empirical and experiential knowledge because, even though I hold all information is necessarily derived from the senses, knowledge can be achived by relating experiential information through deduction.

[3] There are legitmate uses of force, namely defensive force. But even when justified, violence in anarchist societies are likely to be viewed as a last resort.

Human Liberation

i used to write a blog before this.

mostly, in fact, i used to translate things in said blog. but sometimes i would write.

there i wrote things from the point of view of a three-way conjunction: libertarianism + direct action (anarchism) + humanism.

i have since repudiated humanism entirely, and driven my anarchic libertarian view towards a more realist/Darwinist stance. i could argue i have simply made my mutualism thicker, but that’s for another occasion.

nonetheless, i want to bring some of my old writing into focus here, and add the proper criticism to it.

i will be thus translating and adding new remarks and bits to my old posts. they will be archived in the “Human Liberation” header in the sidebar. i hope to bring forth through this a more profound comprehension of my own current view.

after that i shall goes into further depths of coldness…