Social Mutualism: An Overview
It’s hard to know where to start when introducing a political philosophy. The traditional left-right partition is certainly facing a shake-up, although unfortunately in part from groups like the alt-right, whose ‘rebellion’ is merely a cosmetic façade over a deep compliance with traditionalism. At the same time, the left is arguably split between those who would merely attenuate the establishment with further regulations and taxes, and those who, largely with good will, underestimate the problems of state authority, and overstate the applicability of antiquated socialist theory to a capitalism, and a world indeed, that has changed beneath them. State and corporate power are equal threats to the individual, and perspectives that focus on only one will find themselves under the boot of the other.
In the briefest sense, Social Mutualism is to Mutualism what Social Liberalism was to Liberalism at the start of the 20th century. It takes a minarchist, rather than staunchly anarchist approach, acknowledging a place for a limited state, both for compatibility with existing international systems, and for those areas where the state has proved some merit, such as health and social care, and natural monopolies, where markets simply cannot not provide an effective solution.
Rather than working from abstract principles down, I’m going to start in the middle with some policy proposals, and work out from there into both their philosophical justifications and the details of their implementation. For now, I’ll summarise the most important aspects:
Social Rent is the mechanism of property ownership and allocation. The underlying principle here is that that which is not created cannot justifiably be owned. We will be running with the socialist definition of property, which is concerning land and natural resources, not personal property. We’re not coming for your toothbrush.
Property does not conform to the mechanisms affecting most commodities. When more people require property, there isn’t a property factory that can simply increase supply; it is of ‘fixed supply’. Virtually all has at some point been taken by force, and therefore even in present hands, by the the reasoning of the present establishment, it is stolen property. Yet all that aside, even on a purely practical basis, private property is not working: it has created markets rife with speculation and is becoming increasingly unaffordable for the masses. If property ownership is a right, then it can only be so if that right is achievable.
On the other hand, in terms of assessing the relative value of property, the market does work. Both usufruct and state allocation require arbitrary, subjective decisions on value from some point of authority or another, whether central or local.
The approach of social rent, then, is to consider property time as the commodity, not property; that is that one can buy and own the right to use property for a certain period. And buy from whom? The only reasonable owner, which is everyone. Practically, this does require a caretaker, in the form of a body independent from both state and private interests, whose job it is simply to auction property time, and to distribute the gains. Externalities like environmental pollution can also, in some cases, be accounted for at the source of the relevant resource.
One distinct advantage of this is that the system is self balancing: if property prices go up, so does everybody’s income. As automation progresses and the means of production become exponentially more valuable than human labour, the dividends of social rent inherently scale to an appropriate level. Rather than a UBI, set at an arbitrary level and given as a handout by the state, social rent places individuals in an irrevocable position of ownership; it abolishes property by making it universal. It also has the side effect of creating a much greater sense of investment in society, and a mutual interest in each other’s success and productivity.
The single common tax is placed on that common ownership. It removes the need for the taxation of individuals or companies, requires very little administrative overhead compared to the nuances of the present tax system, nor the potential violence of its enforcement methods. This funds a state limited in both size and power.
The hybrid state itself is composed of an incredibly small central body, with highly independent and horizontally interacting departments. Decision makers within those departments are not assigned from the central state down, but nominated from relevant professions and approved by the public; technocracy with a democratic safeguard, if you will. Power in one area is not inherently transferable to another, and the central state cannot arbitrarily assign ministers from one thing to another where they have no relevant experience.
Cooperative enterprise is not a system of regulation placed upon companies; it is a redefinition of what constitutes a company in other to avoid that necessity. Rather than demand that owners give more to workers, it views ownership as an inherent result of the contribution of labour. That is to say that a company is the people who work for it. This changes the least for sole traders and small businesses, but the most for large corporations. Part of this involves putting workers and consumers in more direct control of regulation, giving them the means to protect themselves and agree on standards. Not only does this put such decisions in the hands of those affected by them, but also engenders a greater degree of support for practices and standards agreed mutually, rather than from above. It is not the role of the central state to enforce these rights of participants, but measures need to be taken to ensure ease of access to a legal system allowing everyone to uphold their own rights.
Mutual credit is to currency what social rent is to property. Markets, again, work very well for pricing commodities in most cases. Unfortunately, the ‘rational economic decisions’ touted by conservative economists as the solution to poverty simply do not work in practice without abundant credit. What credit does is to allow individuals to concentrate on making the best long term decisions, even when those decisions exceed present cashflow. But isn’t spending more than you have irresponsible? Not if it saves you in the long term. The repeated purchase of low-quality goods has not just a socioeconomic, but an environmental cost.
The implementation of mutual credit can be assisted greatly by taking advantage of technology and currency reform. In the simplest sense, all individuals will become a ‘miniature central bank’, sharing in the benefits of currency creation and lending. A system of factoring can be embedded within the currency, providing rolling short term credit by cancelling out chains of credits and debts across the system. A distributed system of trust allows for sensible limitation, without the authority, private ownership, or punitive nature of present credit reference agencies.
One of the biggest opportunities and challenges for Social Mutualism, then, is the design and creation of a new, combined digital currency and mutual credit system. Additionally, it must avoid the potential deflationary spiral, and ensure steady but not excessive inflation, balancing price stability with the gradual attrition of accumulated wealth. Although the system as a whole must consciously set rates of interest and currency creation, a digital platform allows this decision making to also be carried out in a distributed fashion, without control from government or a central bank.
The economic and technical design of such a system will be the subject of a future article.
With all these changes, the markets we know as part of capitalism cease to be so, and undertake a different role. Friendly competition is promoted; the cut-throat and pyrric competition of capitalism loses many of its incentives.
A common theme, then, is rather than taking modern capitalism as it stands and trying to force it to behave in a way that contradicts its intuition, to instead change the fundamentals, making desired outcomes natural, and thus allowing the degree of state force to be lessened, while nevertheless curbing equivalent force from private power.
I’ve put together a comparison table to show the common ground and differences between Social Mutualism and other perspectives. Yes, it doesn’t include all schools of thought, and some of the points may be debatable, given internal disagreements. I’ve tried to highlight where these are notable, but of course, real people rarely conform exactly and may well find themselves between these perspectives.
The next few articles will take a deeper look at existing political perspectives, their strengths and problems, and how Social Mutualism compares. Specifically, including communism, anarcho-capitalism, and liberal democracy. We’ll then get deeper into the philosophical and economic background, before working towards some concrete, implementable policy.
