08/26/15 – Sheldon Richman – The Scott Horton Show

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All right, you guys, welcome back.
It's my show, the Scott Horton Show.
Our guest today is our good friend Sheldon Richman.
He is the chairman of the Center for a Stateless Society.
Welcome back to the show.
Sheldon, how are you, man?
I'm doing fine.
Great to be back with you, Scott.
Good, good.
Very happy to have you here.
But so check this out, Sheldon.
I was reading Lou Rockwell's blog, and my favorite conspiracy theorist on the planet, actually, is Charles Burris.
I shouldn't even call him that, because it sounds like I mean it in a negative connotation kind of a way, but I definitely don't.
I really like, well, power elite analysis, as he calls it.
I'm really interested in this kind of thing, always have been.
That's how I became a libertarian in the first place, actually.
I was more of a kook first.
I mean that in a nice way.
But I don't like reading kooky analysis of what are generally considered kooky subjects, you know, and whatever.
So Charles Burris, I like, because he's very serious, and he's a real historian, and he's like a walking bibliography, basically, of really great sources and stuff.
And so he wrote this thing about, this short blog entry about libertarian class analysis and says, this is where we separate the men from the boys when it comes to who's really a libertarian and who's not, is who understands this.
And then, of course, the first thing he links to is libertarian class analysis by you, Sheldon Richmond.
So Sheldon, tell me, why is it that you're not a communist with all your talk about class this and class that, you commie?
Yeah, well, Marx actually could give you an answer to that.
As I say in that article right at the top, when you say class analysis or class conflict, most people immediately will think of Marx.
And that's been one reason why people who don't like Marx shy away from any talk or thinking about class analysis, because they associate it with Marx.
But Marx himself never claimed to invent it, to have invented it.
He credited the early 19th century French historians, liberal historians for first devising class analysis.
And when you say liberal there, you don't mean Marxist, you mean what exactly?
No, I mean radical liberal, what we call libertarian.
These were complete laissez faire people.
They were historians with a very strong interest in economics.
And then, of course, they associated with economists like Jean-Baptiste Say, and they were fans of Adam Smith.
So they were economists in one way, but formerly historians.
And they were what we call radical liberals or libertarians.
They were for almost all of them, except one exception was for a very, very limited state, limited government.
The exception, who I'm a huge fan of, was Gustave Molinari, who was the first to propose that all the so-called legitimate functions of government could be handled on the marketplace.
He's a bit later, but anyway, he's kind of in that general category.
But getting back to the class analysis, these guys originated the theory that the state itself sets up irreconcilable classes.
Between those who produce wealth and those who expropriate it and give it to their friends.
So the great English liberal, John Bright, peace activist, free trade activist, along with Richard Cobden, he beautifully described the two groups as the taxpayers and the tax eaters, or the tax consumers.
And that's the broadest way to approach classes, and it's totally a function of the state because the state is taking wealth from people who produce it and giving it out to other people or keeping it for themselves.
Of course, they always skim off quite a bit before they hand it out to anybody.
Then now you have two antagonistic classes because typically when people produce wealth, they want to keep it.
They have their own purposes in mind.
They want to make their lives better.
They want to make their family's lives better, and they don't really appreciate when someone comes along and takes it from them, even if they're assured that it's being taken for their own good, which of course is the propaganda and the ideological element there to get people to comply with the taxman.
It's cheaper for the taxman if the taxpayers aren't fighting them.
So you've got to come up with a theory that, no, this is really good for you, that we're taking it away from you.
We're doing good things with it, better things than you would do with it.
This also relates to another point that libertarian types have made over the years and most explicitly.with Franz Oppenheimer in Germany who pointed out that in his book, The State, that there's really two ways to acquire wealth.
There's what he called the economic means, and that's what the common sense meaning simply labor, and the political means, which is the expropriation of the products of other people's labor.
When you come right down to it, those are the only two ways to acquire wealth.
You can create it or you can steal it.
The state, and as he puts it, the state is the machinery of the political means.
It's the machinery of exploitation, and this has nothing to do with Marx.
Marx is confused.
In some places, he parallels the liberal, the libertarian class analysis fairly closely, but at other times, he messes it up, and he puts what we call the entrepreneur, let's say, sometimes called the capitalist.
There's reasons to be dubious about that word, but the enterpriser, the person that organizes a firm, let's say.
The liberals put those types of people in the laboring classes, in what they call the industrious classes.
They worked too.
They thought.
They had to think.
They had to come up with ideas.
They bore risk.
They put together an organization.
Assuming they have no links to the state now and they're doing this just on the basis of voluntary exchange, they are also in the industrial class.
They are the exploited.
Marx made the mistake of putting those groups, those people in the exploiter class.
You might forgive him for this because throughout so much of history, the employer class was linked to the state and did get its wealth through exploitation, and so maybe it was an honest mistake.
Maybe we can forgive him, but we should correct it.
An honest entrepreneur who is not getting subsidies, is not getting tax money, is not taking land by eminent domain the way Donald Trump loves to do, that person is as much a worker as somebody on the shop floor or the artisan or somebody who's creating something with his hands.
Thomas Hodgkin, an early 19th century English radical libertarian, made it a point of saying that mental work is also work and that therefore, the person that thinks up an idea and then organizes an enterprise to get that idea out to the marketplace in the form of goods and services, that person is a worker too and is not part of the exploiting class if he's not getting subsidies and other government privileges.
Now, you say here that Marx's confusion stemmed from his labor theory of value.
Can you explain how?
It's a long story.
It's complicated.
I wouldn't even claim I'm a master of it.
I mean Marx had this idea that value in the sense of exchange value.
Back in those days, they talked about value in two terms, use value, which we call utility today, and exchange value, which is basically price.
So Marx had this idea that if there's no exploitation going on, the price of something should reflect the labor cost, what he called the socially necessary labor cost that it takes to make the thing.
The Austrian school and others who embraced the subjective theory of value would say the price is determined by people's assessment of the goods, but then as the productive process goes on, competition, assuming there's no box to competition, competition will drive down price toward cost, but not just the cost of labor, what it costs to hire somebody to make the good, but also land costs and costs of machines or maybe renting machines or things like that.
So costs are certainly relevant to the formation of prices, but Marx wanted to boil it all down to one thing.
All right.
Well, I'll hold it right there.
We'll come back and pick it up with Karl Marx and libertarian class theory right after this with Sheldon Richman.
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All right, Sheldon, welcome back.
Talking with Sheldon Richman about this article he once wrote for the FFF years ago about libertarian class analysis.
He says it was the libertarians who invented class analysis in the first place and Karl Marx came and screwed it up.
Maybe even meant well, but was just confused at the time, but boy, is it a big deal.
His error and the consequences of his error, they're flowing from there, just, well, we'll get to that in a second.
But anyway, you were explaining there, Sheldon, at the break, how it was that he made the error from the idea of the labor theory of value, that the value of something comes from how hard somebody worked to create it, not how much somebody wants it.
And so once he made that mistake, then he decided anybody employing anyone else is basically enslaving them and ruining them.
And so I guess we all ought to just be employees of the government and then we'll all be free, something like that.
Yeah, roughly, something like that.
Yeah.
So his view that all value, not use value now, but exchange value, comes from labor leads to the idea that if the worker is working for someone else and doesn't get the full amount that the product brings in the market, then he's been exploited.
This was shown to be incorrect by the second generation Austrian economist, one of the giants, Eugen von Bomberwerk, a colorful name, famously showed, at least I believe, and a lot of other people believe, that Marx made a big mistake in claiming that the mere fact, no, Bomberwerk wasn't bringing politics into this.
He was assuming a free market.
The mere fact that someone who's working for someone else is not paid the full amount that the product brings in the market is not proof of exploitation because it takes time for a good to be produced and eventually sold, but the worker himself doesn't want to wait all that time.
He wants to be paid every week, every two weeks, every month, whatever the case may be.
But if you're making a car or you're making a building that takes a long time to build, that isn't going to be sold, it's not going to yield income for a long time, the worker doesn't want to wait and so therefore he's advanced wages by the employer and some of that, in a way that's a loan, right?
Because he's being saved, the worker's being saved the time, the waiting time.
And so when the employer eventually sells the product, it's going to, if he's been right about consumer demand, the proceeds from the sale are going to be greater than what he's paid in wages and a component of that is what we call the entrepreneur's profit, pure entrepreneurial profit.
Now when I say this, I'm assuming there's no state intervention whatsoever because state intervention in the form of corporatism or favors to the employer class as we have today could exaggerate that implicit interest payment and actually create exploitation of people who work for other people.
That's a long story and it's a bit of a side, you know, it would take us far afield.
But Bomberverk, at least in general theory, showed that the mere employment relationship is not inherently exploitative.
Yeah.
Well, and in Mark's confusion, what he ended up doing was basically claiming that all entrepreneurship is illegitimate and that you got to live in a totalitarian state instead of allowing people to, you know, go into their home businesses.
Well, to be fair to Marks, he did envision the eventual withering away of the state, although his contemporaries didn't believe him.
Obviously there were there were narco communists like Bakunin and others who said, yeah, right.
You've got a chance that the state's going to wither away, Carl.
Once we get the dictatorship, that's it.
That's the end of the story.
But Marks wasn't convinced.
Yeah.
And and I guess for the for the communist anarchists, they're just I mean, they're basically totalitarians anyway.
I mean, I admit I never read all of Bakunin, but it doesn't make any sense that you're going to have collectivist anarchism and that it's not that it doesn't just really mean communism in practice anyway.
You have your syndicalist board of voters and whatever, you know, deciders.
It sounds like communism depends on who we're talking about.
I mean, Bakunin seemed pretty serious that he did not like authority in the sense of political authority.
He seemed to dislike it as much as Benjamin Tucker disliked it, who was a great one of the great, you know, American individualist anarchist and free market anarchists.
So, yeah, I'd be a little careful about thinking that if, you know, push comes to shove, they side they would side with the state.
I'm not an expert on Bakunin, but I don't think that I wouldn't jump to that conclusion.
All right.
Fair enough.
So but now what's all this got to do with you and me now in 2015 anyway?
Well, what it has to do here's what it has to do with us.
The people who run the government and their cronies, it's the popular word these days, crony capitalism, and the cronies who are outside the government but have a lot to say about it, you know, use the state to transfer wealth from the, you know, the great bulk of the population to themselves.
I mean, we see this with the war complex, the industrial, military industrial complex all the time.
You know, the trillions of dollars.
I mean, even if we just go back to, you know, 2001, 9-11, you know, a great work being that was done at the Washington Post by Arkin and Dana Priest, the trillions of dollars which has been taken from the taxpayers and transfer to favored companies and consultants and various, you know, operatives and scholars at universities and then, of course, government personnel themselves is just unbelievable.
The Pentagon came to an account for, what, hundreds of billions of dollars every once in a while?
I mean, trillions.
But they simply can't...
Yeah, trillions of dollars they can't account.
It's like in somebody's pocket somewhere.
They forgot about it.
Then no one knows what happened to this little money.
We know that Iraq was a major project to funnel wealth into the pockets of favored companies, Halliburton and all the ones that went over there to build installations and to provide food.
And, you know, of course, the name that comes to mind, probably your mind too right now, was Nick Turse, right?
Who wrote a book on the complex.
It's just unbelievable how companies decided, wait a second, why should we make stuff for consumers?
We could be making stuff for the state.
You know what, though?
Let me play commie for a minute or, you know, progressive type liberal leftist, some kind of left wing something and say, yeah, but what you're describing still fits perfect with what Mark said about class.
This is the ruling class, evil capitalists and the empire at war.
And what you're doing is you're trying to lump in poor welfare recipients with them and say that, well, they're all the same because they're all using the political means to get by instead of having a job.
Well, what I say to that is I think you can make a distinction between welfare recipients, you know, people at the bottom who are getting food stamps or, you know, ADC payments or things like that from this other group we're talking about.
First of all, those people have no clout whatsoever.
This idea, and I think here's even some libertarians made a mistake, I mean, going back to Bastiat, they thought that once democracy came in, it was going to change and that everybody now would be, you know, Bastiat has the famous quote of the state is that great fiction by which everybody lives, can live at the expense of everybody else.
But the reason I think that's not entirely, you know, literally true is that some people have better access, easier access to power than other people.
Food stamp recipients don't have access to political power.
There, it's true, they're getting tax money.
But the reason it's different is the government is throwing them some crumbs to keep them quiet because they may catch on that the system is corrupt and exploitative and they may decide they don't want to take it anymore.
So you give them something, you know, to keep, you know, put some kind of net under them so things can't get, you know, bad beyond a certain point because otherwise people may entertain revolutionary thoughts.
That's very different from giving money to Lockheed and, you know, these big companies, Boeing, you know, all these companies that rake in hundreds of billions, trillions of dollars from the taxpayers, you know, every year making goods that nobody would be buying in the marketplace.
Yeah.
It's the government.
We're not, we're not there as the buyer.
You know what, Sheldon?
I've been too involved in libertarianism for too long and I guess maybe you have too.
Back when you were already a great libertarian and I was just a kid, I remember hearing Ross Perot talk about the special interests, special interests this, special interests that.
What the hell is that anyway?
And I guess the libertarian lesson that I finally learned was the special interests, it is virtually everybody, or like you said, you could exclude the very, you know, most powerless, but otherwise the special interests are, you know, the most powerful factions.
They're pretty really, you know, easy to name, bankers and arms dealers and oil salesmen and the medical industries and agribusiness and Israel and, you know, I guess the old people lobby is just a kind of adjunct of the medical lobby, that kind of thing.
But you know, I guess maybe this isn't fair.
I don't mean to sound like patronizing or evil or whatever, but I basically imagine that most Americans are about as lost as I was at 14 listening to Ross Perot talk about special interests and know that he's right, but not know what he means and certainly not understand that that's what the Constitution is.
Regulatory capture from day one, that's what it's for, you know, and just power factions meeting together, the Congress as the skull and bones conspiracy meeting house where they come together to plan to rob us, that this is our enemy, the state and the people who exploit it.
It's just, it doesn't seem like it's ever made clear in those kind of terms to the people at large.
But what do you think?
Yeah, it's pretty open.
I don't think you really need to discuss it in conspiratorial terms.
It's not a big secret.
Well, that's why I say the Congress is the conspiracy.
It's right there on C-SPAN.
I mean, you can watch them.
That's the plot.
It's as open as can be.
It's there for anybody to see, but unless you get seduced by the ideology, the ideology says it's all for our own good.
You know, Lysander Spooner, who was, of course, one of the great American libertarians, anarchist, who totally understood the class theory, said, you know, the difference between the government and the highwayman, you know, the highwayman robs you, right?
You're riding down the road and he holds you up and then he leaves you.
Unlike the state, he doesn't keep hounding you to convince you this is all for your own good, right?
But he lets you go once he takes your money.
The state is worse because the state spends, you know, a lot of resources convincing you that this is all for your good and you should, you know, you should love the state for this and you should every four years or two years go to the polling place and pick your robber because this is all for your own good.
So if people buy that, then, you know, they won't object.
I think a lot of people understand it's a scam.
They just feel powerless to do anything about it.
What worries me today is the people, some of those people who feel powerless to do anything about it are now attracted to Donald Trump, thinking he'll do something about it, but they're not listening to what he says.
He doesn't want to reduce government power.
As he said, a single thing indicating he would reduce government power, no, quite the opposite.
He's going to concentrate power in himself and cut deals.
He's going to cut smart deals all over the place.
Deals for who?
For us.
In other words, I'm not going to get to make my own deal with a Japanese car seller.
He's going to make the deal for me.
He's going to make sure if I buy a Ford that's made in Mexico, I got to pay thirty five percent more for it than I would have if he just bought it out.
Well, you know, I was just I was just reading a thing recently that your article reminded me of where I forget some important, you know, modern liberal thinker and I mean liberal in the modern sense, you know, Democrat type was arguing that, you know, come on, really natural liberty and all that is just bogus.
And and real liberty means participation in democracy.
That's as much liberty as you're going to get is you could run for office, too.
And that's pretty good.
So in other words, liberty means exercising power over someone else or or, you know, having a say in the compromise that leads to the power being exercised over you.
But that the idea of just being left alone is just passe at this point.
But what's funny is the way you put it in your article is his view is the ancient one that, you know, the the American idea supposedly was based on its refutation and the idea of the natural rights of man to do what he please without being aggressed against, except, you know, as the way we learn it in in school as kids, unless you commit a crime or violate somebody else.
Yeah.
Yeah.
Well, this was another this goes back to another one of those great French thinkers, Benjamin Constant.
Last name looks like the word constant.
He has a famous essay, you can find that online called The Liberty of the Ancients compared to the liberty of the modern, something like that.
And he points out that the ancient view, going back to, say, Greece, the city states, democracies in Greece, freedom really consisted of one thing, and that was the the the ability to participate in the political process, have your say, cast your vote.
And then you go you had to go along with, you know, whatever the majority decided.
The modern notion is the is the ability to live the private life without your neighbors or anybody else, you know, coercing you, aggressing against you, telling what you have to do with your life, your body, your property.
So anybody who takes this view that you're expressing now is a throwback, has this ancient mentality.
They like to think they're progressive.
It's not.
It's the opposite of progressive.
It's about as regressive and reactionary as you can get.
The modern notion of freedom is the idea that you own yourself.
And other people own themselves.
And that's that sets up the boundaries around people, right?
I own me.
You own you.
So therefore, I can't act like I own you.
And it's not just no tread on me.
It's don't tread on them.
Don't tread on anybody.
Right.
That's something people need to understand.
And unfortunately, you don't.
Right.
Well, you know, the one thing that we have going for us, I think, as libertarians, and I don't mean like invoking founding fathers, you know, who were not necessarily heroes in this kind of thing.
But, you know, our our very bottom line sentiment is the creed of this land.
You know, that is the deal, self-evident truth that everybody's born free.
And everybody except, you know, the professors pretty much at least pretends to believe in that as a starting premise.
They don't have the consistency that we have.
But they do already.
We were all raised up on that as our kind of basic belief system.
They just you know, people just need more Sheldon Richman's to to follow the example of, you know, how that natural rights theory can, you know, really express itself, you know, through the rest of these, you know, in answering the rest of these questions.
And they don't get enough of that.
But that's why I think there's hope for us yet.
You know, well, I sort of agree with you.
And I did an article some time ago saying that, you know, people are sort of roughly most people are roughly half libertarian.
It's just that they have a double standard.
Right.
So they wouldn't go out and rob from their neighbor, even if they plan to do something good with it.
Right.
To give it to the homeless person.
Right.
Give the money to the homeless person down the street.
They wouldn't think that's right.
The neighbor certainly wouldn't think it's right.
However, if a politician does it or if somebody who's been empowered by Congress does it, we have a double standard.
We think, oh, that's different.
The state can do that.
So what we really we're halfway there, I think.
I mean, maybe I'm being over optimistic.
What we need to do is convince people that there's only one moral standard for all people.
By the way, that includes the people of Israel, too.
There's only one moral standard for all people.
And if stealing is wrong and it is wrong, then political stealing is also wrong.
The fact that you put political in front of the word, you know, it doesn't make it right.
Bastiat used to talk about legal plunder is still plunder.
Right.
Even if even a 51 50 percent plus one say, yeah, let's rob the other 49.
We're not supposed to be moral relativists.
That's wrong.
It doesn't matter how many people endorse it.
All right.
So that's Sheldon Richman.
Find him at Sheldon Richman dot com and find this one at FFF dot org libertarian class analysis.
Thank you so much, Sheldon.
Anytime, Scott.
Thank you.
Bye bye.
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