"Free Market" Reforms and the Reduction of Statism

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Objectivist scholar Chris Sciabarra, in his brilliant book Total Freedom, called for a "dialectical libertarianism." By dialectical analysis, Sciabarra means to "grasp the nature of a part by viewing it systemically-that is, as an extension of the system within which it is embedded." Individual parts receive their character from the whole of which they are a part, and from their function within that whole.

This means it is a mistake to consider any particular form of state intervention in isolation, without regard to the role it plays in the overall system. (See Sciabarra's "Dialectics and Liberty, The Freeman, September 2005, http://tinyurl.com/6pa6pg.)

Another libertarian, blogger Arthur Silber, contrasts dialectical libertarianism with what he calls "atomistic libertarianism," whose approach is to "focus on the basic principles involved, but with scant (or no) attention paid to the overall context in which the principles are being analyzed. In this manner, this approach treats principles like Plato's Forms... ."Atomistic libertarians argue "as if the society in which one lives is completely irrelevant to an analysis of any problem at all."

To determine the function a particular form of state intervention serves in the structure of state power, we must first ask what has been the historical objective of the state. This is where libertarian class analysis comes in.

The single greatest work I'm aware of on libertarian class theory is Roderick Long's article, "Toward a Libertarian Theory of Class" (Social Philosophy & Policy, Summer 1998). Long categorizes ruling-class theories as either "statocratic" or "plutocratic," based on the respective emphasis they place on the state apparatus and the plutocracy (the wealthy "private-sector" beneficiaries of government intervention) as components of the ruling class.

The default tendency in mainstream libertarianism is a high degree of statocracy, to the point not only of (quite properly) emphasizing the necessary role of state coercion in enabling "legal plunder" (Frédéric Bastiat's term) by the plutocracy, but of downplaying the significance of the plutocracy even as beneficiaries of statism.This means treating the class interests associated with the state as ad hoc and fortuitous. Although statocratic theory treats the state (in Franz Oppenheimer's phrase) as the organized political means to wealth, it still tends to view government as merely serving the exploitative interests of whatever assortment of political factions happens to control it at any given time. This picture of how the state works does not require any organic relation between the various interest groups controlling it at any time, or between them and the state. It might be them and the state. It might be controlled by a disparate array of interest groups, including licensed professionals, rent-seeking corporations, farmers, regulated utilities, and big labor; the only thing they have in common is that they happen to be currently the best at latching onto the state.

Murray Rothbard's position was far different. Rothbard, Long argues, saw the state as controlled by "a primary group that has achieved a position of structural hegemony, a group central to class consolidation and crisis in contemporary political economy. Rothbard's approach to this problem is, in fact, highly dialectical in its comprehension of the historical, political, economic, and social dynamics of class."

I have argued in the past that the corporate economy is so closely bound up with the power of the state, that it makes more sense to think of the corporate ruling class as a component of the state, in the same way that landlords were a component of the state under the Old Regime. Blogger Brad Spangler used the analogy of a gunman and bagman to illustrate the relationship:

Let's postulate two sorts of robbery scenarios.

In one, a lone robber points a gun at you and takes your cash. …