Libertarian Labor Review #15
Summer 1993, pages 24-30

         PRINCIPLES OF LIBERTARIAN ECONOMY: Part 2 of 3
by Abraham Guillen
(translated by Jeff Stein)

     As part of our continuing efforts to present anarchist
economic theory, we offer this translation from Abraham Guillen's
book, Economia Libertaria. Because of its length, we are publishing
it in three parts. The first part was in LLR #14, the conclusion
will be in LLR #16.
 
                 The Demystification of Politics
     The experience of more than half a century of "velvet
socialist" [ie. social democrat], Christian democrat and liberal
governments practicing Keynesian economics in the West, as well as
the totalitarian communist governments of the East with centralized
planning, has been that the workers remain wage slaves either way,
building up surplus value for the private or State owner. They are
exploited as much on one side of the world as another, whether
under the governments of Olaf Palme, of Kohl or Honecker, of
Thatcher or Reagan, of Gorbachev or Yeltsin. 
     From this it can be deduced that "state socialism" is neither
socialism nor communism, but is instead the collective ownership,
usufruct, of the totalitarian bureaucracy over the surplus value
extracted by the State. This bureaucratic socialism is the formal
critic of private capitalism, but allows it to be transformed in
the West into multinational capitalism, and in the East allows
capitalism to be restored. Consequently, this leaves "libertarian
socialism," essentially anarchism, as the rational and necessary
critic of both private capitalism and of state socialism as
bourgeois socialism.
     But if libertarian socialism wants to be an alternative to the
bourgeois socialism of the West and the social-economic chaos of
the East, it must be able to make the beauty and seduction of
anarchist utopia compatible with a realistic economic, social and
scientific vision of the world, consistent with our time. It must
present a social-economic program which overcomes the crises in
economy, society, politics, ecology, demographics, energy, of moral
and intellectual value. It must seek to harmonize natural resources
and human resources in a new social-economic order in which all
people have the right to labor and education, in a way that
overcomes definitively the old division of manual and intellectual
work.
     "Is it necessary," asked Bakunin, "to repeat the irrefutable
arguments of socialism, which no bourgeois economist has yet
succeeded in disproving? What is property, what is capital in their
present form? For the capitalist and the property owner they mean
the power and the right, guaranteed by the State, to live without
working. And since neither property nor capital produces anything
when not fertilized by labor, that means the power and the right to
live by exploiting the work of someone else, the right to exploit
the work of those who possess neither property nor capital and who
are thus forced to sell their productive power to the lucky owners
of one or the other." (Obras. Volume III, p.191)
     But let us again insist that the workers, within a self-
managed economy where the means of production and exchange are
socialized, without either bourgeois owners, or technocrats and
bureaucrats of centralized state economic planning, would be
capable of conducting the economy themselves. 
     Now then, a libertarian economy of the self-managed type has
to be capable of producing an economic surplus greater than under
private or state capitalism; of converting a large part of this
surplus to the reproduction of social capital, improving the
productivity of labor. Therefore the workers will achieve a higher
rate of growth in productive forces than private or state
capitalism. There will be, thus, better and greater production with
less expense of human effort and greater and better use of
automated machinery. This is because only the automation of labor
makes it possible to create the technical basis for libertarian
communism. Socialism or communism can be justified neither
economically, politically nor socially as popular misery. A
dominant class backlash would be justified as necessary if the
workers eat all their capital without replacing it, or without
increasing it more than the soviet bureaucracy or the western
bourgeoisie.
     Proudhon, quoted by Guerin, concerning the self-managed
economic regime, said: "The classes...must merge into one and the
same association of producers." [Would self-management succeed?]
"On the reply to this ...depends the whole future of the workers.
If it is affirmative an entire new world will open up for humanity;
if it is negative the proletarian can take it as certain....There
is no hope for him in this poor world." (Daniel Guerin, Anarchism,
p.48)
     In sum, there is no need to lament, there is a need to
educate, to become the protagonist of the future; to prepare
oneself to improve things and to make revolutionary changes; to
understand the sciences, sociology, economy, and revolutionary
strategy; since without a successful revolution, there can be no
liberation of the workers, an outcome which cannot delegated to
others but must come from the exertion of their own self-powers.
                  Planning and Self-Management
     The planned economy has been praised by the technocrats and
bureaucrats of socialism, East and West, as the rationalization and
codification of national economies, with the goal of giving them a
harmonious law of development, both economic and technological.
According to this scheme, all the sectors of production and
services will be coordinated so that none of them advances ahead or
falls behind so much that it causes a crisis of disproportional
development between the branches of industry, agriculture and
services. However this supposed "law of harmonious development of
national economies" directed by an army of bureaucrats and
technocrats has in reality only introduced alongside private
capitalism the capitalism of the State, leaving the workers, as
always, as dependent wage workers. In both cases the workers are
wage slaves that produce surplus value for the capitalist
enterprenuers or the State-enterprenuer.
     Apologizing for the planned economy, as the scientific economy
par excellence which can predict the future with rigorous
calculations, able to conduct national economies according to prior
objectives based upon macroeconomic calculations, to guide the
desired economic development with the help of "control equations"
for the month, year, four-year, five-year, all the economic science
which was the hallmark of central-planning, was declared as vulgar
economic science. Particularly has this been the case in the Soviet
Union, although now Yeltsin under the IMF has discovered
capitalism, pure and simple, as a new "democratic" economy, even
though it impoverishes the workers.
     But after many years of centralized planning the national
economies have revealed a crisis of underproduction, or undersupply
of the market and a crisis of disproportional and unequal
development between industry and agriculture, in the USSR and all
the countries of the ruble zone. Indicative planning, as advocated
in the West by the techno-bureaucratic thought of Keynes,
Schumpeter, Galbraith and Burnham, was an economic doctrine, of
center and left and including some of the right, taken up by the
parties of the social-democrats, socialists, christian-democrats
and neo-liberals. These parties mobilize the politicians of the
middle class professionals, who aspire to a State-benefactor where,
as the first enterprise of all, the technocrats are the directors
more than the capitalists properly speaking.
     By means of the welfare-State the reformist middle class, from
right to left, comes robbing the usufruct of the government. Thanks
to the sector of nationalized enterprises, of social security
insurance, of public services, and the nationalization of many
banks, a "bureaucratic-technocratic bourgeoisie" is created, more
solid, if possible, than the old bourgeoisie. Thereafter, if their
businesses register a deficit, there is no one who will cancel it,
or even less keep account of credits and debtsor if things go bad
force the enterprise into bankruptcy. On the contrary, the abundant
existence of nationalized enterprises in the West has created a
whole series of directors, executives and "businessmen" with
inflated salaries, regardless of whether their enterprises can show
benefits greater than losses. This "bourgeoisie of the State" is
shoving aside the classic bourgeoisie, since the former has
political parties monopolizing the State, the nationalized banks,
the machinery to print inflated money and to tax with discretion.
The only beneficiary from the growing productivity of labor,
growing like a foam on the waves, is not a private owning class,
but those who indirectly own public property in the form of State
property, as a political class.
     Accordingly, indicative planning or centralized planning,
which aspires to impose a balanced national economic development,
has distorted the law of harmonious social division of labor. The
welfare State expands the unproductive sector (middle class
functionaries, bureaucrats and technocrats), while increasing the
productivity of labor in industry and agriculture. This creates an
aberrant economy of inflation of the unproductive population which
sterilely devours the wealth of societies and nations. It can lead
to a total economic crisis, of systematic nature, since in order to
resolve it requires more than simply changing leaders. Instead a
corrupt, contradictory and antagonistic socio-economic regime of
multi-national capitalist monopolies opposed to the general
interest must be replaced with universal libertarian socialism.
     The economists and politicians of the middle class parties,
including in their ranks the reformist union bureaucrats, the
professional politicians, the phoney savants (political, economic,
and technical), would submit to a social economy, as much in the
East as in the West, of a dictatorship of the techno-bureaucracy as
"new dominant class." The bourgeoisie, due to the centralization of
capital in both large and small enterprises, diminishes in
statistical number, according to the law of mercantile competition,
liquidating in the market those capitalists who are smaller and
thus equipped with less productive machines which produce at a
higher cost. But, in contrast, the bureaucracy, the technocracy,
the professional of all types, are augmented more by the very same
thing that diminishes the bourgeoisie annihilated by economic
competition, the centralization of capital in the multinationals.
                     The Totalitarian State
     In this sense, the State tends to convert itself into the
largest of all business enterprises in the West, and as the only
business in the East, that is to say, the enterprise which owns all
the nationalized enterprises. And thus, under these conditions, the
State which owns everything also is the master of all persons who
by virtue of their political alienation see the State as God-
protector, although the State as sole protector of Society takes
from them by taxes, charges or low salaries more than it gives in
return. Meanwhile the poor people are hoping that the State is a
benefactor, and that a middle class political party will offer to
save them in return for their votes. Each day things go from bad to
worse, because the countless bureaucrats consume from above the
capital which is needed below to maintain full employment in
industry and agriculture.
     Without debureaucratization and debourgeoisfication there is
no way out of the growing economic and social crisis which is
caused by the excessive economic waste involved in the sterile
consumption of the parasitic classes: the bureaucratic apparatus of
the State, the superfluous institutions filled with supernumerous
personnel, the administrations of enterprises which have begun to
have more "white collars" than productive workers, and finally, a
whole series of "tertiary" and "quaternary" services that spend
without contributing much to the social wealth. And we are not
saying that this happens only in the capitalist countries, but that
this affects equally badly the so-called "socialist" countries. By
means of centralized bureaucratic planning of their economies, all
social capital, labor, national income and economic power is placed
in the hands of a techno-bureaucracy of planning, for whom workers
and their products are only ciphers in five-year plans.
     In this way they create social relations between those who
have Power and those who suffer as wage workers not essentially
different than those existing in the capitalist countries. So it is
that the worker continues as the producer of surplus value, whether
for the State or private businesses. Meanwhile the workers do not
have the right to self-manage their own workplaces, to
democratically decide its organization and the economic surplus
produced, nor to elect their own workplace councils by direct and
secret vote. Without these rights, centralized planning creates a
bureaucracy based upon state property instead of social property,
and endeavors to substitute State capitalism for private
capitalism. Thus eventually it ends up by alienating into an
external power outside of the wage workers, whether under the
western capitalist or the soviet model.
     The large western capitalist enterprise, national or multi-
national, when it concentrates multi-millions in capital and
exploits monopolies in production and thousands of workers (for
example Fiat, Siemens, I.C.I., General Motors, Unilever, Nestle,
Hitachi, or nationalized industrial complexes like IRI, British
Steel and INI) leads to a bureaucratic and totalitarian condition
within the enterprise. The workers neither know nor elect the
administrative councils of these gigantic corporations, anymore
than the workers in the former USSR. The directors are forced upon
them from above, just as in other ages the mandarins and satraps
were designated in the regimes of Asian despotism. 
     For the Soviet regime to have qualified as socialist, not just
semantically but in reality, it would have had as its economic
basis the social ownership of the means of production and exchange,
the direct democracy of the people instead of the bureaucratic
dictatorship of the single Party, the decentralization of power
(economic, political and administrative) by the means of a
federalism which would have assured the popular participation at
all levels of decision-making, political, economic, social,
cultural, informational and self-defense. In this way a self-
managed, libertarian, self-organized society, would have replaced
the dictatorship of the bureaucracy, in which society was
regimented and watched-over by the State-employer, all-powerful
permanent leaders and the political police of the KGB.
     It could be argued that a vision of such nature is utopian or
too good to be true, but historical experience shows that
centralism cannot create more productive forces than can
decentralization and federalism. Centralism is always bureaucratism
and consequently consumes unproductively in the salaries of
supernumerous personnel. In our epoch computer networks--if they
are well programmed, if their memory is updated and constantly
renewed, if they register all the fundamental data of a country, a
society, an enterprise, a locality, district and region--are more
efficient and cheaper for the management of the enterprise or
society than the professional politicians or technocrats and
bureaucrats of all types.
     If the State is given too much power, as under the Soviet
model or under the western welfare-State, it will tend towards
state control over capital, labor, technology, science,
information, industry, of social security and public services.
Therefore this absolute power will create a totalitarian State,
even though disguised as a parliamentary regime, symbolically under
the Soviet model and rhetorically but not in practice in the West.
In either case, the totalitarian bureaucracy or the pseudo-
democratic political class collectively controls the business of
the State as its business, but parasitically as a cancer on
Society.
                     Popular Self-Government
     In our school of thought, economic growth, the right of work
for all, economic, cultural and technological progress, are
developed with fewer obstacles in a libertarian society than in a
society under the totalitarian dictatorship of large capitalist
monopolies or the capitalism of the State. In both cases, given the
great progress realized by our society, the dictatorships of
private capital or State capital can be overcome. A self-managed
society can be established with social ownership of the means of
production and exchange, uniting capital, labor and technology
without antagonism over classes or forms of property. This would
create an egalitarian society in culture, economics and technology,
thanks to an economy of abundance.
     It is possible to the give power of self-government to the
local communities, districts, provinces and regions, by means of an
economic federalism and self-administration which would be
integrated into a Supreme Economic Council. This would not be a
Gosplan as in the former USSR, but a co-government of things by
means of federations of production and services. These federations
would function democratically and be self-managed, with the goal of
the total process having a law of harmony of development without
economic crises of disproportionality between all the branches of
production and services. In other words, they would function
without relative crises of underproduction or overproduction as
occurs, respectively, under State capitalism or private capitalism.
     For this to happen, it is necessary to have democracy and
economic growth, with an increased productivity of labor. This
would also require the full employment of the active population,
along with the full participation of all in the decisions and the
knowledge for this within reach of everyone. It is necessary to
create a libertarian society, in which the elites of power and
knowledge and social estates of every type, would be transcended in
work, science, capital and technology, by means of effective self-
management, the real participation of the people. Thus it would be
possible to abolish all class domination, whether that of the
bourgeois State and its capitalist economy or that of the
bureaucratic, totalitarian State and its centrally planned economy.
It is necessary, therefore, to liberate oneself ideologically from
parliamentary socialism, from totalitarian communism, from
bourgeois democracy which is economic dictatorship, from
corporatism of every type--and establishing in their place a
democracy of association, self-managed and libertarian, where
everyone would be equal in rights and responsibilities, with
privileges for no one. Only this type of self-government is
government of the people, by the people and for the people.
             Federations of Production and Services
     The planning of economic, cultural and technological
development must arise from the putting of social wealth in common
and not under the domination of the State and its techno-
bureaucracy. The first case involves a program of harmonizing the
proportion of growth of the branches of production and services
with full participation from bottom to top, based on a libertarian
and federative socialism. The second, the concentration of all
power in the hands of the State, leads to centralized planning from
top to bottom, without popular participation, so that the workers
are more objects than subjects, so many ciphers in the Gosplan,
according to the soviet model.
     If the worker remains separated from worker by means of
private property or State property, there must be between capital
and labor a power of domination over those who labor for a wage.
The working people can never be emancipated within this mode.
Emancipation can not be won individually but only collectively,
although each may have free will. The realization of full liberty
and personality for the worker requires a self-organized society
without the need for State oppression, whether it is called right
or left, bourgeois or bureaucratic, conservative or revolutionary.
Without self-managed socialism, social property and self-
government, all systems are the same.
     The salvation of humanity is collective and not individual,
because the human is a social being, solidaric, with the aim of
self-defense from other species since the paleolithic period. It is
the class division of humanity, in the wake of private property and
the State, which makes possible the exploitation of man by man, of
the proletarian by the proprietor. Along these lines, Bakunin said
to his friend Reichel: "All our philosophy starts from a false
premise. This is that it begins by always considering man as an
individual and not, as it must, as a being who belongs to a
collective." (Oeuvres, Volume II, p.60)
     On this sentiment, Proudhon agreed with Bakunin to the extent
that man is a social being, needing community and solidarity: "All
that reason knows and affirms--leads us to say--that the human
being, just the same as an idea, is part of a group... All that
exists is in groups; all that form the group are one, and
consequently, what is ...Outside the group are no more than
abstractions, phantasms. By this concept, the human being in
general...is from that which I am able to prove positive reality."
(Philosophie du progress, Obras, Volume XX, pp. 36-38)
     The human being, in reality, does not exist outside the
society from which he/she has appeared as a free subject; but at
the same time solidarity with others in daily life, at work, in
education, in self-defense, particularly at the beginning of
humanity, "mutual aid" was the basis of existence of man associated
to man, even though under capitalism man is possessed by an
appetite for wealth and the cult of the money-god.
     Developing the doctrine of "mutual aid," Kropotkin, who
studied the behavior of many animal species, predicted that this
would evolve in a future society:
     "Society would be composed of a multitude of associations
united among themselves for everything which would require their
common effort: federations of producers in all branches of
production, agricultural, industrial, intellectual, artistic;
communities for consumption, entrusted to provide to all everything
related to housing, lighting, heating, nutrition, sanitation, etc.;
federations of communities between themselves; federations of
communities of production groups; groupings even wider still, which
would encompass a whole country or including various countries;
groupings of people dedicated to work in common for the
satisfaction of their economic, intellectual, artistic needs, which
are not limited by territorial boundaries. All these associated
groups would combine freely their efforts by means of a reciprocal
alliance (...); and a complete liberty would preside over the
unfolding of new forms of production, of research and of self-
organization; individual initiative, not withstanding, would be
encouraged and all tendencies towards uniformity and
centralization, combatted." (Alrededor de una vida, p.140)
     By means of this federalism based upon libertarian socialism,
the economy, the natural and human resources, the balance of
natural ecosystems, the full employment of available labor, the
leisure and education time at all levels of knowledge, the social-
economic and cultural life of locality, district, province, region,
nation or the world, can be programmed with the participation of
everyone in everything, without creating a great deal of confusion.
On the contrary, the local and the universal, the individual and
the society, the particular and the general, would be understood
perfectly by reason of complete information from computer networks
which would register all the important data to accomplish at the
end a perfect database. By virtue of this, everyone would know all,
avoiding thus a condition in which those with knowledge have the
power, as occurs in the totalitarian, bureaucratic, centrally
planned countries, where the people are ignored.
     The federations of production and services, dividing into
natural associations, from the bottom to the top, create the
democratic conditions for a planning with liberty. Unlike what
happened in soviet Russia, the economic planning would not be
entrusted to a dictatorship of technocrats who want to substitute
themselves for the old bourgeoisie. To be employed by the total
State instead of by an individual boss does not change the
condition of dependency and alienation for the worker, except to
make the situation worse; since this makes the law into a fraud, a
law that does not limit the absolute powers of the State, which
corrupts absolutely the few who govern absolutely, the few
oppressors and exploiters written in the lists of the
"Nomenclature." To change, therefore, private capitalism for State
capitalism from a western pseudo-democratic bourgeoisie to a
totalitarian bureaucracy is a poor trade for the wage workers since
they do not cease to be what they are, the producers of surplus
value for the bourgeoisie or bureaucracy, for the private boss or
for the State.
     In consequence, as the founders of the IWA put it, "the
emancipation of the workers is the task of the workers themselves."
From this point of view, working people can only emancipate
themselves by the means of a libertarian socialism of self-
management where "the chaos of production would not reign," but
instead there would prevail a planning with liberty, with the
participation of workers and citizens at all levels of political
and economic decision-making; of information, culture, science and
technology; of information processing, gathering, classification,
and computerization of data, economic, demographic, political,
social, scientific, technical, natural resources, etc.
     A social-economic program, with continual popular
participation (not indirectly through municipal, regional or
national elections), must be by the means of federations in
industry, agriculture, and services, integrated into a Federative
Council of the Economy, in which all the federations producing
goods and services must be represented. By way of example, this
"Federative Council of the Economy" would have to integrate, among
others, the following federations: Fruits and horticultural
products; Cereals; Feed for livestock; Food industry, including
imports; Hostelry and Tourism; Wine, beer, and alcoholic beverages;
Oils and greases from vegetable and animals; Fishing: boats and
canning; Textiles; Furs and leather; Timber and cork; Paper and
graphic arts; Chemicals; Construction; Glass and ceramics; Metal
machining; Steel; Non-ferrous minerals: metals and alloys; Energy:
petroleum, coal, gas, electricity, and atomic energy; Information
and the construction of computers, integrated micro-circuits, and
semi-conductors; Electronics: numerical controlled machines;
Biotechnology; Aero-space; Research and Development, uniting
technology with work.
     This list of industrial federations does not include all the
social and public services, which would be too tedious to number
but would have to be represented in the Federative Council of the
Economy as well. By example, commerce, banking, sanitation,
security and social security, which are enormous, would have to be
reorganized, since these entail much unproductive work that would
have to be reduced. The goal must be that concrete production is
not exceeded by unproductive work, since this would restrain or
slow real economic growth. In other words, there must be no false
increase in the Gross Internal Product, which occurs when it is
incremented solely by services and not in the branches of industry,
in either the primary sector (agriculture, fishing, livestock,
lumber, minerals, etc.) or the secondary sector (industry of
diverse types).

