C4SS Topic: Right-Libertarian “Free Trade” and “Free Markets”: The Exoteric, and Esoteric Version

Excerpt:

By way of background, the main current of what is called “libertarianism” in the United States, and “liberalism” elsewhere, treats the Gilded Age as a satisfactory proxy for the “free market.” See, for example, Jacob Hornberger’s characterization of that period as a close approximation to laissez-faire because… well, read it for yourself:

So, here you have, Richard, a society where there was no income tax, no welfare state to speak of. I mean, there was land grants to the railroads, but there was no Social Security, no Medicare, no Medicaid, no education grants. I think the only real welfare program was pensions to Civil War veterans. And so here you had a society where government didn’t take care of anybody.

No, the government didn’t take care of anybody — except the Robber Barons who got those land grants, whose extent was larger than entire European countries. And the plutocracy as a whole, who inherited the property distribution, wage system, and other structural legacies of centuries of Enclosure, imperial conquest, and enslavement. America itself was sitting on top of a continent stolen from its native population, and enormous tracts of that continent were closed off and granted to privileged absentee owners who went on to exact tribute from those who actually put the land to use. Just read Albert Nock’s account of the scale of land grants and land speculation that prevailed among our “Founding Fathers” in Our Enemy, the State. Slavery may have been formally abolished, but industrial capitalists in the election of 1876 handed over a third of the country to former slave-owners, and allowed them to institute regional Apartheid and reduce the nominally free black population to peonage, in return for a free hand in plundering the rest of the country. Of course those former slave-owners retained their massive concentrations of land that rightfully belonged to the slaves who had worked it for them. So basically all large concentrations of wealth in this ostensibly “laissez-faire” period were the result of past robbery and murder on a scale that boggles the mind, and its nod to “free markets” was simply to say “All right, no more robbery, starting… NOW!” Parrington didn’t call this period the Great Barbecue because of the government’s restraint in taking care of people.

And don’t forget that the state intervention wasn’t relegated to the past. The state actively intervened to stop working people from taking back some of the wealth that was stolen from them. The period from the Great Betrayal of 1877 to the War Hysteria and Red Scares of the Wilson administration were a prolonged civil war in which the railroads, great banks, grain wholesalers, and capital in general, in alliance with the American state, fought ruthlessly to suppress the cooperative, farm populist, and labor movements. Besides the rail barons’ use of differential rates to break the will of the rural farming population and defeat the cooperatives, this war extended to the nationwide repression of the labor and socialist movements after Haymarket, Cleveland’s use of federal troops to break the Pullman Strike, and endless pitched battles by state militias against striking workers from the Copper Wars out west to Homestead. The totalitarian ideology of 100% Americanism, Loyalty, Old Glory and the American Legion was created to socialize American workers into the belief that (hat tip to George Frederick Baer) “The rights and interests of the laboring man will be protected and cared for… by the Christian men of property to whom God in His infinite wisdom has given the control of the property interests of the Country.”

So what it all boils down to is that the Gilded Age is massively statist to its very core; it lives, moves, and has its being in ongoing, pervasive, systemic violence with the state at its core. It is closely interconnected with all the other legacy institutions from the previous blood-soaked centuries in which the peoples of the world were subjugated to capital. But for Hornberger, it’s an adequate approximation of “laissez-faire” because the government did nothing to take care of poor people, while protecting the propertied classes in continued possession of the enormous mountain of everybody else’s stolen loot it sat atop. And Richard Ebeling has the chutzpah to comment in reply with an allusion to Bastiat on “What Is Seen and What Is Not Seen,” which means that irony is officially dead. As I commentedat the time:

Individualist anarchist Benjamin Tucker once said of Herbert Spencer that “amid his multitudinous illustrations … of the evils of legislation, he in every instance cites some law passed, ostensibly at least, to protect labor, alleviate suffering, or promote the people’s welfare…” Entirely missing from this discussion is the primary, upward form of income redistribution from poor to rich, through structural intervention to reduce the bargaining power of labor and increase the monopoly returns on accumulated property — a redistribution which dwarfs, many times over, compensatory downward forms of redistribution through the welfare state. Missing are the fundamental ways the state has been in structural alliance with capital — not just some hand-waving at “crony capitalism” and “corporatism” — since the beginning of capitalism five or six hundred years ago.

Returning to Slobodian: The precedents appealed to by right-libertarian advocates of “free trade” are likewise telling, when it comes to all the legacy effects of past robbery and brutalization, and all the ongoing forms of embedded coercion, that are necessary for maintaining their “non-coercive” system. This is true, in particular, of Ludwig von Mises’s lionization of the trade policies pursued under the British Empire following the triumph of the Liberal Party and repeal of the Corn Laws.

Mises and Hayek — unlike many of their most prominent followers today — were not anarcho-capitalists, and were willing to at least obliquely acknowledge the role of the state in maintaining their favored system. Slobodian writes that the term “neoliberal” — which today is applied variously to the global economic model upheld by the Bretton Woods institutions and the rest of the postwar order created by FDR and Truman, and to the Washington Consensus policies prevailing globally since the advent of Reaganism and Thatcherism — was originally coined at the Walter Lippmann Colloquium in 1938 (which, counting Mises and Hayek among its attendees, was sort of a dress rehearsal for the Mont Pèlerin Society, founded nine years later). Although the actual origin of the term “neoliberalism” is contested, and its adoption may have been a contested issue among the Colloquium attendees themselves, the Lippmann Colloquium and Pèlerin Society were key sources of the post-WWII policy currents currently identified as neoliberal. And whether they agreed on the term “neoliberal” as such, they saw their favored agenda as a “renovation of liberalism” in response to the perceived failure of the original liberal order in the 19th century — first through the disintegration of WWI, then through the rise of high national tariffs, and finally through the corporatist national economic policies adopted in response to the Depression and the autarkic models of the USSR, the European fascist regimes, and the Greater East Asian Co-Prosperity Sphere — and the need for a new international order capable of preserving a resurrected liberalism from similar disintegration.

Far from seeing a liberal order as spontaneously emerging, as Slobodian describes it, Mises et al envisioned the need for “a strong state to take a more proactive role in defending the conditions of competition against the disruptive demands of voting publics, organised labour and special interests.” Mises and Hayek, in particular, romanticized the Austro-Hungarian empire as a model in miniature for the kind of international polity required to enforce the neoliberal order. Viewing nationalism as the enemy of economic liberalism, Mises “conceived instead of multinational forms of governance capable of protecting a world of what he called ‘perfect capitalism’ with total global mobility of labour, capital and commodities.”

[...]

Read at: Center for a Stateless Society