Posts tagged Stephan Kinsella

Real Good Friends Of Mine

Many years ago, when I was first setting up radgeek.com and preparing to migrate my blog over to it, I had already come around to completely rejecting so-called intellectual property. But I liked messing around with markup languages and microformats, and I was playing around with the new Creative Commons licensing gee-gaws, and I was not yet as thoroughly and acutely digusted with legalistic approaches or licensing formalities as I am now. So my way of making a statement at the time was to slap a CC-SA-BY logo on my website, and a long copyleft statement to go with it, which stuck around for the next 9 years. Man, that shit got boring.

So, back in February, I threw out my old copyleft notice for a new, Anticopyright statement. I didn’t put up much notice on the front page, but after everything that happened in January, and with the new work I’ve been doing for the past few years, I felt like it was time for a change. The old statement was an elaborate production, boring and full of legalistic notices, based around an explicit viral licensing scheme. I thought then — and, really, I still think now — that the open-access terms of copyleft licenses are — in the abstract — justifiable as a sort of legalistic kludge, to try to wedge open spaces for open content within the immensely shitty, locked-down political situation. But the more I’ve thought about it — and especially since re-reading William Gillis’s 100% anticopyright and re-printing Aaron’s Manifesto — the more I’ve felt like this was not nearly enough, and the more I felt like it was both conceding far too much of the argumentative ground, and also compromising far too much of my voice, as an enemy of copyright — for me to go on repeating those things with a straight face. So whatever good CC, GNU-FDL, and other copyleft licensing schemes have done to facilitate some of the technical aspects of the free culture movement, there is no legal solution to the problem of intellectual monopoly, and there will never be any solution at all except for a culture of widespread, radical, non-legalistic, ethically-grounded rejection of all claims of intellectual property, and a grassroots culture of social solidarity with remixers, pirates and other free copyists. The more brazen, the better. So I offer my anticopyright statement, such as it is, as a contribution to that culture.

. . . I don’t care anymore. It’s not enough to try to kludge the legalities of copy-monopolies from within. So-called intellectual property is in fact nothing more than a legally fabricated monopoly, suppressing competition and emulation, constraining creativity, confining culture, science and technology to captive, capitalist-dominated markets, and violently depriving many of the poorest and most marginalized from access to critical resources for education and life-saving medicines. The legal fictions of copyright and patent are despotic attempts to monopolize the human mind; power-psychotic burdens crippling and destroying individual ownership and the progress of grassroots culture and technologies; outrageous constraints on human intelligence and creativity; and a destructive and desperate protectionist scheme for the profit of powerful corporations. This web project is, in spirit and in letter, at war with every aspect of Intellectual Protectionism, in its principles — of monopolizing power, entitlement, social control and economic privilege — and in its operation — through increasingly invasive government policing and legal coercion — and in the disastrous global effects of patent and copyright restrictions.

I’ve been glad to see that some people found the statement useful, and have passed it around, even though I made the change fairly quietly behind the scenes of the website and didn’t make any particular effort to post notice on the front page. In the first part of my anticopyright notice, I wrote:

Copying is not theft, and when you reprint, duplicate or imitate you don’t deprive anyone of the work or the ideas that they had. . . . Copy, reprint, translate, make derivative works as you please. If you want to support the work, you can do that. But anyone found copying the content on these pages without permission, will be a real good friend of mine.

And so, with that in mind, here’s some real good friends of mine:

And most recently:

Thanks, y’all! I’m glad if you’ve found the writing useful; and I’m really quite honored if you’ve passed it around. If you’ve copied the free-copy-notice, and I didn’t catch it here, feel free to let me know in the comments.

This machine kills intellectual monopolies.

On Being Pretty Much O.K. With That. (Factories, Corporate Secrecy, and Free-Market Anti-Capitalism Edition.)

Here’s a couple of loosely-related conversations from elsewhere on the web. I bring up the less recent one because the more recent one reminded me somewhat of it.

A while back (last May) I was hepped to an odd conversation on left-libertarianism going on over at the Mises Community Forum. I decided to jump in on a terminological point; the thread then became something of a quiz about left-libertarian and free-market anti-capitalist economic beliefs. In reply to some questions posed by Freedom4Me73986, I answered that, in addition to being a free market anti-capitalist, sure, I also call myself a socialist, and yes, I am anti-boss.

Freedom4Me73986:

@Charles Johnson: Do you call yourself a socialist?

Yes, in Tucker’s sense. Some reasons for doing so discussed here, and here, and also here.

And are you anti-boss like many others in the ALL seem to be?

Sure.

I think bossing and conventional employment are both (1) likely to be unstable, and economically unsustainable, in a fully freed market; and (2) kind of shitty ways to treat your fellow human beings.

— Charles Johnson (28 May 2012), re: What’s your beef with Roderick Long and left-libertarianism? at the Mises Community Forum

In reply, Freedom4Me73986 asked:

So how does a bossless factory work if there’s over 100 workers? How can that many people all make decisions w/o a boss? How can 10 people make a decision w/o a boss? Bosses exist for a reason. There way more efficient. Without one nothing would get done.

— Freedom4Me73986 (28 May 2012), re: What’s your beef with Roderick Long and left-libertarianism? at the Mises Community Forum

To which I answered, first, that you might look at existing examples of big factories running without a boss; but that there is also a more important point. Boldface added.

Well, I dunno. I guess if you really want to know the answer to this question, and don’t just intend it as an apriori Gotcha! about what you are already sure must be unworkable, then probably the best thing to do is to ask some of the people who already work in bossless factories with over 100 workers. There are a number of interviews in books like this one. My impression is that it is typically done with a combination of temporary, constantly-rotating responsibilities, a lot of local initiative on the shop floor, and regular big group meetings for making decisions as a group. Maybe this is an inefficient way to do things. On the other hand it seems to be working for the people who are doing it. In any case, I am quite sure that the claim that “Without [a boss] nothing would get done” is empirically falsifiable, and has in fact been falsified. Spontaneous orders are of course possible without central direction.

But in any case suppose that it turned out to be true[1] that on the whole, in a maximally freed market, the complexity and the costs of keeping everyone communicating with everyone else would tend to hobble the workability of big factories without bosses. That might be a reason to think that there will be more bosses in a freed market than I think there will be. But it might just as well be a reason to think: Well, then there will be smaller factories. And if we turn out to have smaller factories, with their activities largely coordinated by trade and contract rather than by bureaucratic management, I don’t see how that would be a problem. Certainly there is no reason apriori why libertarian economics would have to be concerned with figuring out a way to run giant factories with hundreds of workers. If that turns out to be economically and socially sustainable under conditions of free-market competition, then people will do it. But I don’t take it for granted that it will be, and if it isn’t, then people won’t sustain it, and will find other market means of meeting their needs.

In fact I would say there are some strong reasons to think that that kind of business model — at least, nearly every example of that business model that we have available to us for inspection, from General Motors to Lockheed-Martin to GlaxoSmithKline to Foxconn — is not a product of freed market labor agreements, but rather of a pretty heavy-handed structure of government-financed lines of credit, government privileges, government subsidies, and government contracts to the employers, on the one hand, and on the other hand, political impoverishment, political dispossession, and political constraints on the employee’s options for alternative modes of making a living. My reasons for thinking that bossing will be unsustainable in fact have a lot to do with factors that will apply whether or not big factories tend to need bosses (e.g., they have to do with the changes which are more likely, ceteris paribus, to occur within labor markets when people’s fixed costs of living are radically lower, and their options for making a living outside of formalized employment relationships have radically expanded, as discussed briefly e.g. in The Many Monopolies and in Scratching By — all of which are changes that, if they are likely to come about, are likely to come about regardless of the organizational economics of trying to run a large factory.)

— Charles Johnson (28 May 2012), re: What’s your beef with Roderick Long and left-libertarianism? at the Mises Community Forum

I’m reminded of the conversation back in May because of a different thread in Stephan Kinsella’s recent AmA on Reddit. Kinsella highlighted his opposition to patents and copyrights in the pitch for his AmA, and a lot of the conversation focused on the topic of IP. When asked, Kinsella added that in addition to patent and copyright, he also favored the abolition of trademark and trade secret laws, saying:

I am totally against patent, copyright, and also tradmeark and trade secret. Trademark law should be replaced with fraud law only. Trade secret should just be a private contract. Easy.

— N. Stpehan Kinsella (23 January 2013), re: I am Stephan Kinsella … AMA at /r/IAmA

Redditor /u/probablyreasonable asked, in response:

Trade secret entirely replaced as a private contract? You’re joking right? What of the litany of examples where exiting employees do not sign their nondisclosure? What of the litany of examples where the disclosing party was not in privity with the TS owner?

Please elaborate.

— /u/probablyreasonable (23 January 2013), re: I am Stephan Kinsella … AMA at /r/IAmA

I answered with a charitable clarification of Stephan’s position (as far as I understand it), and then some commentary of my own on the argument, in which I am speaking only for myself. If government doesn’t enforce corporate secrecy, then corporations may have more trouble keeping their secrets. Well, then there may be fewer companies keeping secrets. I’m pretty much OK with that.

Stephan’s view is that if they didn’t sign the contract, then their actions should not be prosecutable. The reason they should not be prosecutable is because they didn’t violate any rights that they were bound to respect. This means that only people who have agreed to keep a secret can be bound to keep it; if that arrangement causes a problem for companies being able to police their own secrets, then we may well end up with fewer businesses whose business models depend on keeping information secret. Well, OK. It’s not obvious, to me at least, that this is a bad outcome.

— Charles Johnson (23 January 2013), re: I am Stephan Kinsella … AMA at /r/IAmA

probablyreasonable replied with what seems to me a bizarre non sequitur, about utopianism and corporate espionage.

Corporate espionage unpunished and will encourage the behavior to increase profitability and competitiveness.

Again, all of Stephan’s arguments presuppose that everyone in our society is healthy, co-operative, and not driven to criminal behavior. This is not the case.

— /u/probablyreasonable (23 January 2013), re: I am Stephan Kinsella … AMA at /r/IAmA

Again, speaking only for myself and not all of Stephan’s arguments, I replied:

That’s a problem if you think that corporate espionage is a problem. I think that corporate business models that are heavily dependent on secrecy and institutional opacity are the problem, and that corporate espionage is a predictable reaction, and a symptom of a broken business model. If companies can adequately keep their secrets by means of contractual agreements and simple property rights (e.g., controlling who has access to sensitive locations or documents in their possession) then they will keep their secrets. If they cannot adequately keep their secrets by these means, then they will fail at keeping their secrets. And if their business depends on keeping secrets, they will fail at their business. That doesn’t mean that nobody will go into business; it means that people who go into business will find it to their advantage to adopt alternative business models, which don’t depend so heavily on secrecy. Again, you need to actually give an argument if you want to establish that this is an unjust, or even an undesirable outcome.

— Charles Johnson (23 January 2013), re: I am Stephan Kinsella … AMA at /r/IAmA

There is no reason at all why writers who defend market relationships should feel compelled to rig their theory in such a way that it could somehow justify, explain the value of, or defend the interests of gigantic-scale factory production, or rigidly-enforced institutional opacity and corporate secrecy. Speaking for myself, as a free-market anti-capitalist, I think that one of the great values of open, bottom-up market relations are the radical possibilities they might offer for destabilizing these deeply dysfunctional, monopolistically policed concentrations of commercial and industrial power.

Also.

  1. [1] I’m not committed to this claim, but I don’t reject it out of hand either.

Rad Geek Speaks: In which I join an Anti-Capitalist Mob at Libertopia

I am happy to announce that I have been invited to speak at three sessions at the upcoming Libertopia convention, October 11-14, in San Diego, California. In particular, I’m going to be doing:

  1. Part of a panel on so-called Intellectual Property, together with Stephan Kinsella (Saturday October 13, 2012, 2pm-3pm), on the Main Stage.

  2. A breakout session on Ask an Anti-Capitalist! A Freewheeling Q&A on Markets Not Capitalism, Left-Libertarianism, and Mutualist Ends Through Free-Market Means (Sunday October 14, 2012, 9:45am-10:30am).

  3. Part of a panel discussion on Markets Not Capitalism, together with my co-editor Gary Chartier, and contributors Roderick Long and Sheldon Richman. (Sunday October 14, 2012, 3pm-4pm), on the Main Stage.

  4. Tabling in the exhibition area for Markets Not Capitalism, the ALL Distro, and Center for a Stateless Society. We’ll have copies of the book, booklets, pamphlets, buttons, and more; and we’ll be there to talk to convention-goers about free-market anticapitalism and left-libertarian ideas. I’m going to enjoy the talks but in all honesty the person-to-person contact and the tabling is the kind of groundwork that I see as by far the most important stuff, and which I’m most looking forward to doing.

I should mention that the Ask an Anti-Capitalist! session is being held in the John Galt Room, which I’m choosing to take as one of the more hilarious culture-clash moments I’ve had since I started doing this gig. The bad news is that this is scheduled opposite breakout sessions by Gary Chartier on war, and Sharon Presley on libertarian feminism (?!?). I guess the good news is that by packing us in like this, they’ve ensured that no matter what breakout session you go to during that block, you are going to get some lefty libertarian stuff to hear. Anyway, there’s going to be a veritable mob of left-libertarians, free-market anticapitalists, C4SSers and other lefty-friendly commentators there throughout the event, including Gary Chartier, Sheldon Richman, Roderick Long, Stephanie Murphy, not to mention presentations by Angela Keaton, Sharon Presley and Anthony Gregory. You can check out the whole schedule here.

We’re doing our best to do all this on as thin a shoestring budget as possible. I’ve arranged for couch-surfing and carpooling to help keep the travel and lodging expenses as minimal as possible, but there’s still a couple of hefty charges that we’re paying out of pocket to get Markets Not Capitalism and a rambunctious left-libertarian presence out to California. So if you want to help out, you can toss a few coins into the hat with the ChipIn widget below. Donations go to the Molinari Institute, so any proceeds above reimburseable expenses will go to support the production and distribution of market anarchist literature, and towards supporting future speaking gigs for Markets Not Capitalism. Anyway, here’s the shoestring, for reference. (This may be revised as other arrangements get nailed down.)

Markets Not Capitalism 2012 Libertopia budget
Cost Description
$440 Travel. Rental car to ferry me, L., and a friend across the continent to San Diego
~$0~ Lodging en route (2 nights there, 2 back; crash space secured!)
$400 Tabling space expenses. To reimburse Roderick Long for the expense of securing a table in exhibition space for C4SS, ALL, and Markets Not Capitalism
(he will otherwise have to pay out-of-pocket)
$840 Total costs (estimate as of 23 Sep 2012)

Chip In to get Markets Not Capitalism to Libertopia!

ChipIn: Markets Not Capitalism! at Libertopia (Oct 2012)

Thanks! And I hope I’ll see y’ALL there!

On Big Charity

I’ve talked here a couple times before about the notion of mass education and targeted persuasion and how important it is to what I take myself to be doing in writing a crazy-ass blog about all my crazy-ass positions like I do. (The basic notion here is that one way to advance crazy-ass radical views — views which you’re not likely to convince many people of, just as they are, outside of a relatively small, somewhat self-selected target audience — you can still move the conversation forward in really important ways just by taking the time to put the position on people’s intellectual radar — by explaining the view, and why some people might hold it, clearly enough that you thereby push out people’s horizons of intelligible dissent. Most folks still won’t accept your position, but if you do it right, you will get them to where they’ll consider it as a position that’s open for discussion. And just doing that much has a big damn effect on where discussions can go.)

Anyway, the point of mentioning all this is to bring up a really fine post that Roderick put up last month, entitled Wild Cards, which I think does some really important work towards just that kind of dialectical project. After some excellent introductory material which introduces several of the same notions, in other terms, Roderick comes around to this really quite excellent effort to distill the left-libertarian position down to six key points:

Our vital task, then, is to get the word out that there is a position out there that includes the following theses:

  1. Big business and big government are (for the most part) natural allies.

  2. Although conservative politicians pretend to hate big government, and liberal politicians pretend to hate big business, most mainstream policies – both liberal and conservative – involve (slightly different versions of) massive intervention on behalf of the big-business/big-government elite at the expense of ordinary people.

  3. Liberal politicians cloak their intervention on behalf of the strong in the rhetoric of intervention on behalf of the weak; conservative politicians cloak their intervention on behalf of the strong in the rhetoric of non-intervention and free markets – but in both cases the rhetoric is belied by the reality.

  4. A genuine policy of intervention on behalf of the weak, if liberals actually tried it, wouldn’t work either, since the nature of government power would automatically warp it toward the interests of the elite.

  5. A genuine policy of non-intervention and free markets, if conservatives actually tried it, would work, since free competition would empower ordinary people at the expense of the elite.

  6. Since conservative policies, despite their associated free-market rhetoric, are mostly the diametrical opposite of free-market policies, the failures of conservative policies do not constitute an objection to (but rather, if anything, a vindication of) free-market policies.

Of course we should be prepared to defend these theses through economic reasoning and historical evidence, but the main goal at this point, I think, should be not so much to defend them as simply to advertise their existence. We need to make our red spades and black hearts a sufficiently familiar feature of the intellectual landscape that people will be able to see them for what they are rather than misclassifying them – at which point we’ll be in a better position to defend them.

— Roderick Long, Austro-Athenian Empire (2009-09-10): Wild Cards

Read the whole thing.

Now, part of the point of this kind of thing is to provoke discussion. And here’s Stephan Kinsella’s reply to principle (1) in particular:

As I noted there, Do you mean big business as it exists in today’s world, or big business per se? If the former, you have a point (and from my quick read I don’t disagree with any of your other points). But to argue for the latter interpretation would imply that there could be no big business in a free society.

It seems that the bigger a company is, in today’s world, the more they have to play ball to prosper. I’m not sure, though, why this observation is limited to big business, or even business in general. Even individuals drive on public roads, and are incentivized or coerced into using public schools, say. And what about Big Medicine, Big Education, Big Research, and so on? (And let’s not forget Big Labor!)

Come to think of it—most larger charities I’m aware of continually seek state partnerships and funding, and encourage state redistribution schemes. Down with charity!

— Stephan Kinsella, The LRC Blog (2009-09-15): Big Charity

Sometimes with Stephan, it’s hard to tell whether he intends this kind of but-what-about, doesn’t-everybody move as just some further observations riffing on the general theme or whether he really intends for it to be taken as support (by means of a reductio) for some specific objection. But if this is intended as part of an objection to (the per-se interpretation of) Roderick’s claims about the alliance between Big Business and the interventionist State, then what exactly is the objection here supposed to be?

Let’s set aside Stephan’s mentions of individuals driving on government roads, or sending children to government schools. Sure they do; but this doesn’t strike me as even remotely compelling, if you pause for even a second to consider matters of degree, and it’s hard to see what purpose mentioning it really serves except as a way to just sort of scatter critique as broadly as possible. Last year, the Department of the Treasury sent me a $600 check, allegedly for the purpose of economic stimulus — just like how they also cut AIG a $170,000,000,000 check last year, also allegedly for the purpose of economic stimulus. But, well, so what? I’d say it’s still pretty accurate to see AIG as having a much closer relationship with bail-out statism than I do.

So let’s set aside the doesn’t-everybody move, and stick to the comments on other Bigs — large-scale, formalized institutions in which control is concentrated in a professionalized hierarchy and an administrative bureaucracy — whether it’s Big Medicine, Big Education, Big Research, Big Labor, or Big Charity. Kinsella points out that the other big institutions are, in general, tangled up with the interventionist state, just as big business is. If left-libertarians are going to lay down some heavy critique on Big Business, shouldn’t they be doing the same on the other Bigs?

Well, sure.

So what’s the problem?

What makes you think that left-libertarians would have some kind of problem critiquing Big Medicine (2, 3, 4), or Big Research, or Big Education (2, 3, 4), or Big Charity (2, 3), or Big Labor (2, 3, 4)?

Sure, public-private jobbery, state regimented, hypertrophic, centralized institutions, political capture, subsidized featherbedding, and unresponsive professionalized bureaucracies are hardly limited to conventional for-profit corporations. They happen all over the place — in big professionalized charities like United Way or the Starvation Army; in big hospitals and corporate adjuncts of the medical industry (insurance corporations, pharma corporations, etc.); in big administration-heavy multiversities; and in top-down, centralized business unions like the UAW, the Teamsters, or SEIU. Just like the Fortune 500, they’re also major beneficiaries of State regimentation, subsidy, and captive audiences; just like the Fortune 500, they’re also major causes of State regimentation, through their lobbying and political influence. And just like with hypertrophic, centralized, top-down corporate commerce, there’s some solid reasons for thinking that their hypertrophic, centralized, top-down not-for-profit operations would be fundamentally unsustainable in a freed market.

But that’s hardly an objection to the left-libertarian critique of big business; it’s a perfectly acceptable complement to it. Left-libertarians — at least, the sort of left-libertarians that Roderick is an example of — aren’t just conventional libertarians who believe you ought to voluntarily give more to charity. The critique of corporate capitalism is just the most high-profile part of a broad critique of the state’s promotion of credentialism, bureaucracy, and top-down centralized control — which is why folks like us generally promote community mutual aid over professionalized charity; grassroots, rank-and-file unionism over AFL-CIO-style union bosses and collective bargaining; unschooling over bureaucratic-liberal public education; etc., etc., etc.

So, yeah, down with Big Charity. I agree. Where’s the problem?

Updated 2012-03-23. I fixed a typographical error and updated some links to articles from Formulations, whose archives have moved to a newer, more secure web home.

Three notes for the critics of the critics of apologists for Wal-Mart

I’m a few weeks late to the party over Roderick’s Wal-Mart post. For various reasons; I’ve been meaning to write down these notes for a while, but other things have been grabbing my attention. But today seems like a good day to sit down and get to it, and in any case I expect that exactly the same old debate will be coming up some time in the next month or two, so I’d like this to be on record before the next go-around, because there are three arguments from the anti-anti-Wal-Mart side of things that I’m getting tired of reading, two of which I haven’t seen much in the way of substantive replies to, and all of which I’d like, if it is even remotely possible, to make some contribution towards killing dead.

Roderick complained about an article by Fazil Mihlar. Mihlar claims that Wal-Mart deserves both the Nobel Peace Prize and, in fact, sainthood. (I’m not sure that the Vatican has yet started canonizing corporations or other artificial persons. But never mind.) The reason he offers is that Wal-Mart does a lot of good in the world (providing jobs, making donations, making valued goods available at low prices), and that they are able to do that good because of entrepreneurial innovations and expertise in the market, especially the market for the inputs for their business.

Roderick pointed out, in reply, that this account left out a crucial factor: government interventions against the free market that benefit big retail business models, such as the seizure of land through eminent domain, corporate welfare, regulatory suppression of competitors, and government-subsidized infrastructure for long-distance transportation. Thus:

Both Wal-Mart’s critics and its defenders usually see it as an embodiment of the free market. But to me Wal-Mart looks like just one more special interest feeding at the taxpayers’ trough.

I’m opposed to Wal-Mart because I like the free market.

— Roderick Long, Austro-Athenian Empire (2009-03-31): Advocatus Diaboli

I think that’s straightforward enough. But it brought the usual complaints from the usual suspects. There’s a long and very interesting and sometimes illuminating discussion in the comments, which you should read if you haven’t already. But what I want to focus on now is a couple of counter-arguments, which have been repeatedly raised by critics of this line of criticism (notably J.H. Huebert and Stephan Kinsella) which I think involve serious economic errors and a healthy dose of special pleading.

Before I begin, though, let me say a couple of things. First, this post will have absolutely nothing to do with the question of whether or not Wal-Mart is a morally criminal enterprise of the sort discussed in Confiscation and the Homestead Principle, and hence it will have nothing to do with whether or not Wal-Mart enjoys legitimate private property rights over its land, stores, trucks, goods for sale, bank accounts, or anything else, and hence it will also have nothing to do with whether or not it’s O.K. for people to vandalize their stores, loot them, shoplift from them, expropriate their means of production, or otherwise get up in Wal-Mart’s grill. In fact almost nobody who’s been a party to this particular conversation so far (as opposed to some other, separate conversations about protest tactics and Macy’s) has been talking about this, except for a dialogue between Stephan Kinsella and an imaginary left-libertarian in his head. I have my own views on that (which are fairly uninteresting; in short, that there isn’t one answer for the whole corporation and that it depends on the case), but it’s not the issue at hand in Roderick’s article, and it’s not an issue I’ll be addressing here, either.

Second, this article will also have very little to do with whether or not Wal-Mart deserves the Nobel Peace Prize, or sainthood, or praise, or censure, or some mixture or combination of the two. The arguments that I’ll be discussing might feed into a larger discussion about how to parcel out praise and blame, but that’s not my concern here. My concern has specifically to do with the extent to which Wal-Mart ought to be regarded as an example of free-market entrepreneurial success. (That’s related to but distinct from the question of whether Wal-Mart ought to be praised or blamed or neither by free-marketeers. If you’re curious about that topic, this post will disappoint, but you might get something out of my exchange with Will Wilkinson in the post and comments at GT 2008-11-10: The ALLied invasion of Cato.)

With that cleared out of the way, here are the specific arguments that I do want to address.

  1. Why single out Wal-Mart? When left-libertarians point out that Wal-Mart benefits from certain aggressive government interventions, and suggest that this is a reason not to cite Wal-Mart’s bidniz practices as an example of the free market at work, we are constantly asked — with the utmost innocence, even though this has been addressed over and over again every single time it has come up, generally without any response — why we are singling out Wal-Mart for criticism, given that many other market actors also benefit from the same interventions, or from other similarly objectionable interventions. Thus, for example, when Sheldon Richman writes:

    It would be impossible to sort out which profits are legit and which are not. I don’t think that’s the point. The point is to stop the machinery that makes illegitimate profits possible. That’s the state and its various methods of privileging and burdening.

    Kinsella replies:

    Yes. We libertarians are of course against this. So why single out Walmart? By imprecise, lax standards, 99% of society is criminal/suspect. Where does that get us?

    Let me just repeat here the same damn thing that I have repeated every time this stupid question gets asked. There are two main reasons that Wal-Mart gets singled out here. The first reason is often because some conventionally pro-capitalist libertarian brought Wal-Mart up as an example of the free market in action. Since Mihlar brings Wal-Mart up as an example of free market success, then it would be bizarre for Roderick not to have mentioned Wal-Mart in his reply; if we are informed that Wal-Mart ought to be praised because of a characteristic X that it possesses, but it turns out that Wal-Mart does not actually possess characteristic X, then the responsible thing to do is to discuss some specifics about Wal-Mart (not every other market actor toiling in this unfree market of ours) in order to demonstrate that it hasn’t got X. This is, in fact, what actually happened in the exchange that Kinsella was supposedly commenting on.

    The second reason why Wal-Mart often comes up is because Wal-Mart is a convenient example of something broader that they want to discuss — for example, the specific system of state interventions that tends to privilege big box retailers, as a group, at the expense of alternative channels of distribution, and of alternative uses of land more broadly. Of course, Wal-Mart is not the only retailer that benefits from eminent domain seizures, or from government-subsidized infrastructure for long-distance shipping, or from corporate welfare packages in the name of development. So does Target; so does Best Buy; so does Barnes and Noble; and on, and on, down the line, for just about any strip mall chain store you could think of. But Wal-Mart is a convenient example of the broader trend, because of its unique size, scope, and name recognition. If I intend to talk about a certain kind of business model and its relationship with state power, then I hardly think it’s unfair to pick a specific example to talk about, and leave the extension of the analysis as an exercise for the reader. And I hardly think it’s weird or wrong to pick the most prominent and largest example of that particular business model as my specific example. When I write about bad things that the city government in Las Vegas does — for example, its fierce devotion to police brutality, economic cleansing, and using eminent domain to ensure that land gets used the way the tourism and convention industry wants it used, rather than the way that its owners do — I often go beyond simply reporting on local events, and I draw quite broad conclusions about government in general, or city governments in particular, but even then, I don’t feel compelled to mention, in the same breath, every other large city government in the world that does similarly awful things. It’s not picking on Las Vegas, or singling it out, to focus in on it as an example for the sake of discussion. And it is sheer bluster to go on accusing critics of apologists for Wal-Mart of singling out Wal-Mart when they have explained over, and over, and over again why we are mentioning it as an example of broader trends.

  2. Who are Wal-Mart’s competitors? This is, actually, somewhat related to the earlier question, but the issue goes deeper. When Roderick and others (Kevin Carson, especially) point out that the success of Wal-Mart’s business model depends heavily on Wal-Mart’s capacity to convince city governments to grant them corporate welfare giveaways and steal land on their behalf, or on Wal-Mart’s having access to a large network of reliable interstate roads available at a low marginal cost, which are funded in a way that heavily subsidizes those who use them for high-volume cross-country heavy trucking (which is, after all, exactly what folks like Mihlar are referring to when they extol Wal-Mart’s genious at transportation, distribution, and logistics) it is often replied that Wal-Mart is just making better use of available resources than its competitors; that these resources are available not only to Wal-Mart but to its competitors as well, and that, therefore, Wal-Mart’s advantages over its competitors must be the result of something other than the availability of those resources — must, that is, be the result of greater acumen at serving its customers needs. Thus, it is argued, even though Wal-Mart depends on coercively-funded government resources for its current business model, they would (it is argued) have the same advantages (whatever those may be) that make them successful, in this an unfree market, even after the transformation of the market into a free market. Or, at the very least, they oughtn’t to be blamed for being able to successfully make use of those advantages under the present circumstances. Thus, for example, J.H. Huebert in an earlier reply to Roderick:

    We are still not sure why Long believes big businesses, and Wal-Mart in particular, disproportionately benefit from the existence of government roads. No one disapproves of government roads more than we do, but the roads are there for anyone to use — the would-be competitor has just as much access to them as Wal-Mart does. Where is the unfair advantage?

    And again in the comments on Roderick’s more recent post

    How does the existence of government roads hamstring Wal-Mart’s competitors? Anyone can use the roads.

    And Stephan Kinsella, in the same thread:

    Why do the subsidies help Walmart more than local mom and pop competitors? They all get goods shipped from far away

    The main problem with this kind of response is that it betrays a curious sort of anti-economic blind spot about just who Wal-Mart’s competitors are. It is true that, if we lookonly at the other actually-existing businesses that provide substitute goods and services — K-Mart, Target, Home Depot, and other big box retailers, or, expanding outward, smaller, non-chain retailers trying to sell some subset of the goods that Wal-Mart sells — then it is clear that those sorts of competitors do have access to the same kind of government privileges that Wal-Mart does; Wal-Mart just has succeeded more than they have at exploiting those privileges in such a way as to offer the goods most in demand and to offer them at lower prices. Fine. But of course, those aren’t all the competitors that Wal-Mart has — not if you consider the competitors for Wal-Mart’s inputs as well as the competitors for Wal-Mart’s outputs. In conversations like these, it is typical for conventionally pro-capitalist libertarians to act as if the business under discussion were only competing with other large chains in its sector — as if we were just picking on Wal-Mart because they’re an easy target, and rooting for Target instead — or as if it were only competing with retailers more broadly. But it’s not. The market does not just consist of passive consumers and a handful of formalized joint-stock companies. The market is a big and messy place, and whatever you might say about the ways that Wal-Mart gains advantages over other businesses that do basically what Wal-Mart does, it is certainly clear that Wal-Mart’s advantages over competing uses of the land, labor, and infrastructure that are currently devoted to serving its business model.

    Thus, for example, Wal-Mart currently enjoys preferential access to long, straight stretches of land that it needs to ship its goods in trucks. Preferential access compared to whom? Well, not to Best Buy or Mom & Pop’s; they both can get things shipped along the same stretch. That much is seen. But what is not seen is that they — Wal-Mart, and other retailers as well — do have preferential access to those resources when compared the people who used to have, or might have had, homes, farms, parks, small businesses, car-only roads, or any number of other competitive uses of the land, which would have won out if the question were decided by homesteading and voluntary exchange, rather than by tax-funded acquisitions, government land grants, and eminent domain theft. Similarly, other big retailers also typically get at least some of the same government privileges in corporate welfare giveaways and eminent domain seizures in the name of development. Thus, Wal-Mart may not have much advantage over, say, Target, or other fellow big chain retailers, when it come to this kind of government boodle. But those who were using, or would otherwise have used, the money or the land that the government seized, for purposes that government’s don’t count as development, since they don’t increase property or sales tax revenue — keeping up their own homes, growing their own food, running down-market or informal-sector businesses, street-corner hustling, and the like — those people are also would-be competitors for the use of the land, money, or other resources that Wal-Mart is having the government seize and redistribute by force. And those competitors certainly are hamstrung by the government’s redistribution of money, or its expropriation of land. We know that they are because the government is seizing it by force, and people were using it for other things, and would continue to use it for other things unless they were paid more than Wal-Mart and other development beneficiaries pay for it in the forced sale. That is, after all, the point of eminent domain.

    The problem here is that when you fetishize competition as the struggle between similar businesses to provide substitute goods or services, and forget about the other forms of competition for scarce resources that are at issue — often uses by individual property-owners, often uses of the property that may be heavily tied up in local communities and in the informal sector, and may be governed by incentives different from those faced by large, formalized, for-profit corporations — it will, no doubt, seem incomprehensible that someone would focus on how Wal-Mart uses the roads that anyone can use. Because the real nature of the problem is the fact that resources that are currently devoted to those roads cannot be used for what they would be used for in a freed market, which results in a big splash and some major ripples in the market distorted by that particular rock. Not because Wal-Mart alone benefits at the expense of K-Mart or Target, but rather because Wal-Mart, K-Mart, Target, and all the other big-box chain retailers — and, to a lesser extent, also locally-owned, small retailers — all benefit at the expense of somebody other than retailers, and at the expense of uses for land other than the servicing of retail sales, when the government uses force to seize long, straight strips of land, to build and maintain big highways on it, and to open up those roads, mostly without tolls and mostly without price discrimination, to anyone who cares to use it, regardless of what the marginal cost of the use may be. If those big highways weren’t being laid down according to political considerations and development politics, and if they weren’t being heavily subsidized by coercively-seized taxes, the land might well (would probably) be used for something quite other than a large, subsidized national shipping network; and if so, those who intend to go into retail, especially those who want to go into the retailing of goods from an international network of bargain-basement suppliers, might well lose a lot of the comparative advantage that the sword of the State currently grants them over other, non-retail uses of the same scarce resources. It’s not that Wal-Mart is special here among retailers, in anything other than degree; it’s that Wal-Mart is one prominent example of a larger dynamic — the way in which State coercion, State expropriation, and State redistribution sucks scarce resources out of one sector of the economy and spits them out into another — forcibly redirecting them towards large, centralized, formal-sector cash businesses, and away from other, smaller, more localized, more informal, or less commercial uses of the resources (like housing, open space, small farming, cottage industry, local nightclubs, and other typical victims of the Development machine). The reason that Wal-Mart is not a good example of free market dynamics is not because it somehow owes its advantages over Target to government intervention, but rather because Wal-Mart, Target, and the rest of the big retailers all owe their advantages over every other competing use of resources to the heavy hand of government. The result of removing those coercive advantages probably wouldn’t be to hurt Wal-Mart in particular in its competition with Target; but it would remove a mighty big subsidy that Wal-Mart, Target, and all the other big box retailers enjoy over alternative, non-retail uses of the same property. Which might just make for some changes in how our cities look, and in how we get around and make our livings in them.

  • Diamonds, water, and roads: Finally, when Kinsella and Huebert try to exonerate Wal-Mart from blame for the government interventions that it exploits, they often fall back on an argument that it has just made the best entrepreneurial use of a situation that it found but did not create, and in order to support that claim, they have often portrayed Wal-Mart’s relationship with the state as being quite different from what it actually is. Thus, on roads, J.H. Huebert puts it in the most starkly silly terms here:

    Kevin Carson writes: Wal-Mart’s business model is heavily reliant on susidized roads. It supplanted competitors which had local supply chains.

    Yes, but Wal-Mart found the roads there, it didn’t create them, and it used them better than its competitors to serve consumers.

    The funny thing about this kind of argument is watching an Austrian economist suddenly forget everything that he ever knew about marginal analysis, in order to paint a picture of Wal-Mart just bumbling along until — by George! — it finds a road out in the wilderness (perhaps by tripping over it), and thinks why, I might just be able to use this to efficiently serve consumers! Of course, if we are talking about the whole entire Interstate Highway System, then it is true that Wal-Mart did not play much of a role in creating that, and doesn’t play much of a role in the political process that maintains it. It was created largely at the behest of the military-industrial complex and the construction-pork-barrel complex, back in 1956, when Sam Walton was still running a local Ben Franklin franchise. And the political support for it hardly depends on Wal-Mart; the notion that the federal government shouldn’t be involved in seizing land and seizing taxes for the purpose of a huge network of toll-free interstate highways is so far outside the horizons of acceptable dissent in D.C. that nobody would need to lobby against that. So, yes, fine, in that sense Wal-Mart is benefiting from the situation at competitors’ expense (for the reasons I mentioned above), but it did not create the situation that it benefits from; it just got better than some other similar companies at dealing with it.

    But, of course, if you want to do a serious economic analysis of Wal-Mart’s business model, what you really need to know about is not the whole stock of its inputs. What you really need to know about is the marginal units of its inputs. And if we are going to talk about the highway system that services Wal-Mart, we need to look not only at Wal-Mart’s relationship to system of government roads as a whole, but also Wal-Mart’s relationship to the specific stretches of highway that Wal-Mart uses.

    And when we look at it that way, we’ll find that Wal-Mart is heavily involved in every sort of lobbying in order to get various levels of government involved in subsidizing its access to that. Just about every time Wal-Mart decides to build a new store, or especially a new distribution center, they turn to local governments to demand that they grab some money out of working folks’ pockets and put it towards building up business park infrastructure and highway interchanges, or widening or extending some existing stretch of road to service Wal-Mart’s trucking needs, or simply to build a new spur out to service nothing but the distribution center. (A few examples gleaned from a few minutes on Google: 1, 2, 3, 4, 5, 6, 7, 8.) Wal-Mart solicits and actively lobbies for this sort of thing all the time so that they can improve the marginal benefits they get from the road network, while being able to pass along the marginal cost to taxpayers and to those who would have made alternative uses of the land, capital and labor involved.

    So how far is Wal-Mart merely taking advantage of a situation that it did not create, and how far is it actively collaborating in, and pushing for, wider and more intense aggression by the state against private property owners, when it comes to roads? Well, it depends on what you look at. The problem is that those who have wanted to defend Wal-Mart have done so based on lazy arguments based on Wal-Mart’s relationship to the existence of the interstate highway system as a continent-spanning whole. Once you actually look at the construction and improvement of new stretches of road on the margin — which is, remember, what’s important for understanding how far Wal-Mart’s bidniz model does or does not depend on successfully wielding the sword of the State, since it is only on the margin that they are making all of their decisions, counting all their costs, and reaping all of their profits — it becomes clear that Wal-Mart is not just finding the roads there as some sort of given; it went to the government and got the roads it uses put there, typically by force and typically at the expense of unwilling third parties.

If you want to try and defend Wal-Mart, or its apologists, against their left-libertarian critics, fine, let’s talk about that. But please try to find some arguments other than these.

Hope this helps.

See also: