[Originally appeared at Center for a Stateless Society]
In his Third Address to the International Workingmen’s Association on the Paris Commune in 1871, Karl Marx argued that the cooperative organization of production, if it expanded to include the entire economy, would amount to communism.
“If united co-operative societies [were] to regulate national production upon a common plan, thus taking it under their own control … what else, gentlemen, would it be but communism, ‘possible’ communism?”
Two leading lights of nineteenth century liberalism, John Stuart Mill and Herbert Spencer — the latter frequently caricatured as a crude right-wing social Darwinist — envisioned such a “cooperative commonwealth” (if you’ll pardon the term) as the ultimate natural outgrowth of a market economy.
According to Marx, this wouldn’t happen on its own, so long as the capitalist class remained in its politically privileged position. So long as manufacturing required expensive capital goods, and capital was concentrated in the hands of the capitalist class, industry would be governed by the increasing tendency toward capitalist monopoly.
And indeed, cooperative production in the 19th century didn’t replace capitalism — because the capitalists controlled access to capital. According to John Curl, a historian of worker cooperatives, cooperative production was only viable so long as the primary means of production were general-purpose craft tools owned by individual workers. That was the basis of cooperative production as organized by Owenites in the early- to mid-19th century, when unemployed workers set up cooperative shops using their own tools under a common roof. When the factory system resulted in an exploding cost of production machinery, this model became obsolete — the main reason the Knights of Labor foundered in its attempts to set up cooperative production on the Owenite model.
Imploding requirements for capital make capitalist control of access to capital worthless. The effect is to erode the barriers to exponential growth of the cooperative economy. If the primitive accumulation process turned capitalists and landlords into a rentier class through their concentrated ownership of the means of production, the ephemeralization of technology has the opposite effect. James Livingston refers to it as “primitive disaccumulation” — “the conversion of basic commodities like information and music into goods that we can appropriate or distribute without the mediation of money and markets …” (“How the Left Has Won,” Jacobin, August 2012).
Further, ephemeralization and the increased productivity of labor have result in a situation in which the main source of exchange value is enclosed information and knowledge, and artificial scarcity rents on those inputs. Socially necessary labor and material inputs — the actual cost of production — are becoming a smaller and smaller share of the total price of what we consume. It follows that a free market, by tearing down these enclosures, will eliminate — or socialize — the majority of exchange value in the economy and drive the average rate of profit much closer to zero.
It was this ephemeralization, this socialization of productivity and technique, and the accompanying destruction of exchange value, that Bastiat was referring to when he wrote in Economic Harmonies that “the function of property, or rather of the spirit of property, is continually to enlarge the communal domain.”
The creation of true socialism isn’t a matter of political parties or violent revolution. Socialism is what’s quietly emerging as the forces of the free market — i.e., of peaceful cooperation — destroy capitalism.