They Only Come Out at Night
December 21, 2008
Late the other night, not long after publishing my first real post, I received a comment from the subject of my post, Stephan Kinsella, who continues his recent trend of support for the principles underlying labor self-management. Oddly, perhaps in an attempt at humor, he decided to disguise this support in a polemic tone. So in the spirit of things, I’ll play along. It’s always nice to engage with a fellow native son of Baton Rouge. And I don’t mind a little droll humor. You might even see me use some around here occasionally.
I’m not sure if it was the early hour or what, but he appeared to have not read my post very carefully since many of his responses were swinging at ghosts and a large majority of his “objections” actually serve to buttress my point.
One of the strangest ghosts was this idea he had that I was arguing against the co-responsibility of anyone involved as an “idea” person.
I’ve argued–I think very clearly–for why I think someone who hires another person to commit a crime is guilty as a co-conspirator, in Causation and Aggression. It does not rely on these bizarre notions of who owns the means or has “de jure” control, etc.
That’s exactly right. All responsible people are “co-conspirators”. No one responsible party can alienate their responsibility to another, even if they consent to do so. It doesn’t depend on who owns the means or has de jure control. I’m glad that Kinsella seems to have understood my post well enough to summarize the major points so succinctly.
By the way, I recommend that everyone read his article linked above. It is an excellent source of supporting principles for understanding how the productive activity of labor in creating the output “renders all of its participants independently and jointly responsible”. But if we move from criminal examples to non-criminal ones, Kinsella seems to forget his own conclusions (or rather he plays dumb).
I am really mystified at what you are getting at. What do cakes have to do with murder?
Yet he offers no reason why the criminal nature of a resulting action matters when determining who is responsible for the action. Can non-criminal results not have intentional causation? Yes, there is no third-party “victim” but there is the question of who appropriates the newly produced outputs. Since Kinsella finds me incoherent (a charge, on certain days, I’m inclined to agree with), I’m going to call on Theodore Burczak at length to explain the problem:
The controversial issue to notice at this juncture is the rather curious position rented workers assume in this analysis. It would seem that in order for the entrepreneur to be the regarded as the solely responsible agent of a joint productive venture, workers must play a similar role in the ﬁrm as do guns in a robbery: they are the instruments of the entrepreneur’s will.
For Ellerman,…the relevant question is to determine who is responsible for production in the capitalist ﬁrm. Once the responsible agent of production is identiﬁed, Ellerman proposes that we can call upon the “juridical principle of imputation” in order to establish the just appropriator of the entire product. This widely-accepted principle maintains that people should be held legally accountable, or responsible, for the consequences of the actions for which they are factually responsible…In Ellerman’s view, the agent responsible for production is not [the] indivisible entrepreneur alone, but all the workers—mental, manual, and entrepreneurial—who labor in the ﬁrm together.
The typical employment contract in a capitalist enterprise is consequently illegitimate. This contrasts with Locke who believes that it is just for a person to sell his labor time to, say, an entrepreneur, giving the entrepreneur the legal right to appropriate the entire product resulting from the laborer’s efforts. Ellerman points out that when worker B sells his labor time to entrepreneur A thereby granting A control rights over B’s labor time and allowing A to appropriate the entire product of B’s labor, the worker is no longer legally responsible for the results of his productive activities. The entrepreneur becomes the last owner, and hence appropriator, of his employee’s labor time. As such, the worker assumes the legal status of an inanimate object while employed by the entrepreneur.
One purpose of law courts is to determine factual responsibility for criminal behavior in order to assign legal responsibility. When jurists do this, they are applying the juridical principle of imputation. When legal responsibility does not line up with factual responsibility, most people believe that an injustice exists that needs to be rectiﬁed. In the realm of production and resource allocation, Ellerman considers one of the roles of economists to be the identiﬁcation of the factually responsible agents of production, in order to determine how the juridical principle of imputation should be instituted in an economic context. It is impossible to alienate responsibility for one’s actions, whether one is a bank robber or an employee, and if the juridical principle of imputation is to apply in production, all workers should participate in the appropriation of the entire product of the ﬁrm. In particular, workers should be the last owner of their labor time. Ellerman concludes that because it is factually impossible to alienate responsibility for one’s actions, it is unjust for a worker to be transformed by a legally recognized labor rental contract into the means (a thing without legal responsibility) to an entrepreneur’s ends.
The comparison between a bank robber and an employee may illustrate why Ellerman believes that workers’ consent to give up legal responsibility for the entire product of their labor efforts in exchange for a wage is unjust. If a rich murderer uses a considerable cash payment to entice a willing poor person to bear the legal responsibility for the murder, a court would not recognize this contract by jailing the pauper for the crime, even if he agreed to the exchange. Such a contract violates the juridical principle of imputation. Likewise, an entrepreneur’s appropriation of the entire product and his receipt of proﬁt from a productive ﬁrm employing wage-labor are based on what Ellerman regards as a fraudulent wage-for-labor-time exchange. For an economist who accepts all the implications of the juridical principle of imputation, the only way in which joint production can be justly organized is if it occurs in a labor-owned [sic. Berczak incorrectly uses "owned". You can't own the role of the firm.], self-managed ﬁrm in which all manual, mental, and entrepreneurial workers participate jointly in the appropriation of the entire product.¹
This is not saying that consenting adults can’t agree to whatever valid agreement they wish. Kinsella seems concerned that I’m arguing otherwise.
But they can agree among each other to whatever they want, so long as they are not violating others’ rights. In the case of the cake, if I understand it, they’ve agreed so certain titel [sic] transfers as between themselves. These agreements are legal since they do not aggress against outsiders. Dude. You are way off base here.
Here Kinsella could mean one of two titles:
- The title to their labor power
- The title to their labor product
But we already know that Kinsella doesn’t mean the first.
Under libertarianism, an individual has the sole right to control his body as well as scarce resources originally appropriated by the individual or by his ancestor in title. Since ownership means the right to control, an individual may be said to own his body and homesteaded resources he has acquired. He is a “self-owner” as well as an owner of acquired resources. In the case of acquired resources, the rights of ownership include the right to transfer title to others because one can abandon, by manifested intent, a previously unowned resource that was acquired by manifested intent. In other words, rights in acquired resources may be alienated at will because of the way in which they come to be owned.
By contrast, although one may be said to own—to rightfully control—one’s body, the same reasoning regarding acquisition, abandonment, and alienability does not apply. The act of acquisition presupposes that there is an individual doing the acquiring, and an unowned thing acquired by possessing it. But how can someone “acquire” his body? One’s body is part of one’s very identity. The body is not some unowned resource that is acquired by the intentional embordering action of some external, already existing acquirer.
Because the body is not some unowned resource that an already existing individual chooses to acquire, it makes little sense to say that it can be abandoned by its owner. And since alienation of property derives from the power to abandon it, the body is inalienable. A manifestation of intent to “sell” the body is without effect because a person cannot, merely by an act of will, abandon his or her body. Title to one’s body is inalienable, and it is not subject to transfer by contract.²
Also clear from this passage is that in order to transfer something alienable, such as the output of a productive activity, you have to acquire it first.
Despite my perfect agreement with Kinsella on this point, he still comes to the strange conclusion that the shareholders were the first to appropriate the whole product.
Because they don’t own the capital? Because that’s not the deal? Jesus, this is not that hard.
Labor is clearly the first possessor being responsible for producing it (and having not alienated their responsibility). So if it “was the deal” that the shareholder should obtain the product, then it must come by conditional transfer, not by direct appropriation. Therefore, shareholders cannot claim to be the RC and become essentially bond holders and quitclaim transferees. And it’s very “Marxoid” to think that ownership, and not licit responsible possession, makes one the claimant on an output and liable for used-up inputs (returning to Capital the borrowed items in the condition they were loaned and with time-preference).
Might we then just think of each employee as an independent contractor selling the product?
One possibility is to think of employees as independent contractors, so that we interpret what workers sell to the entrepreneur to be the product of their efforts, and not control over their labor activities.
While this interpretation may have analytical purchase for some readers, a typical employee in a capitalist enterprise working on, say, an assembly line would surely not be astonished if he were ﬁred for stepping off the line to talk to his stock broker on a cell phone. He would not be surprised because he knows that he has not sold the product of his efforts to the directing entrepreneur. He has rented his time to that entrepreneur, who thus enjoys the right, within limits, to command the employee as she pleases during the contracted period. The actual servitude resulting from a labor-rental contract and the appropriation of an employee’s labor time by the hiring entrepreneur do not disappear by analytically construing an employee to be a self-managed ﬁrm of one.¹
So I’ll ask Kinsella again (and it was never in “Marxoid English” unless terms like residual claimant are Marxist), how does a shareholder obtain the role of residual claimant when they are neither the owner of the labor power, the responsible party for creating a liability for used-up inputs, nor the first possessor of the unowned product? That would be some magic trick.
¹ Burczak, Theodore, “A Critique of Kirzner’s Finders-Keepers Defense of Proﬁt”, The Review of Austrian Economics, 15:1, 75–90, 2002.
² Kinsella, Stephan, “A Libertarian Theory of Contract: Title Transfer, Binding Promises, and Inalienability”, Journal of Libertarian Studies, Volume 17, No. 2 (Spring 2003), pp. 11–37