Arnold Kling  

Does Cooperation Lead to Socialism?

More on Matt Yglesias... Pays Cuts: Are They For Real?...

Kevin Kelly says yes:

Did we really believe we could collaboratively build and inhabit virtual worlds all day, every day, and not have it affect our perspective? The force of online socialism is growing. Its dynamic is spreading beyond electrons--perhaps into elections.

Thanks to Russ Roberts for the pointer.

It may help to talk about three ways of facilitating cooperative group efforts:

1. Economic incentives.
2. Voluntary actions for non-economic motives, including altruism, desire for recognition, and so forth.
3. State power.

As an economist, I respect (1). However, as a civil societarian, I also respect (2). It is (3) that raises concern. If people come to think of socialism as (2) and not (3), then fine. But if they come to think of (3) as being the same as (2) or a natural progression from (2), then we're in trouble.

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CATEGORIES: Political Economy

COMMENTS (14 to date)
chipotle writes:

Arnold Kling,

This post is a small miracle of pith and insight. Thank you.

Peter Twieg writes:

I think Lawrence Lessig had the best discussion of Kelly's article, refuting the notion that cooperation and socialism can be conflated:

Worth reading, in my opinion.

Sam Wilson writes:

It bothers me a little to see "altruism, desire for recognition, and so forth" described as "non-economic motives". I've been mulling the standard definitions of utility for the past week or so, and I'm having an increasingly hard time divorcing the finer sentiments you and Russ have been talking about for the past month from the more generally accepted "economic" incentives, i.e. the hope for material wealth. Indeed, I see (1) and (2) as precisely the same thing: utility fulfillment. (3) differs in that utility fulfillment becomes coercive, a prospect I find repulsive.

tl;dr: moral sentiments are an economic force: they affect internal decision-making

cputter writes:

Jimmy Wales is an objectivist. That's as anti-socialist as any one person, besides miss Rand herself, can ever be.

I'm quite sure he had extremely selfish motives for starting wikipedia. Empressing girls perhaps?

RL writes:

It's good to know, Arnold, that THEN we'll be in trouble... :-)

shayne writes:

In concert with Sam Wilson's comment above, I would suggest a restatement of 2.: "Voluntary actions for non-financial/monetary motives, including altruism, desire for recognition, and so forth."

BlackSheep writes:

David Friedman also called such cooperation involving non-pecuniary incentives as socialism recently: I think it's a bad trend: it confuses processes and outcomes.

Eric H writes:

Socialist ideas rippling first through "electrons" and into "elections" is a quaint idea. They might seem to ripple one way now, but they'll ripple back just as surely.

Online communities are created and supported by off-line activities like jobs. Once online socialism influences offline reality, will online, within-the-game black markets flourish when gamers have less time to spend in front of the computer screen and less real, discretionary income to barter for battle axes with +5 damage points?

Les writes:

Arnold wrote:

It may help to talk about three ways of facilitating cooperative group efforts:

1. Economic incentives.
2. Voluntary actions for non-economic motives, including altruism, desire for recognition, and so forth.
3. State power.

It seems to me that items 1 and 2 are inherently cooperative because they represent voluntary behavior between consenting individuals.

But state power inherently requires coercion. Just try not to pay your taxes and see what happens.

happyjuggler0 writes:

2 and 3 are substitutes. Government redistribution crowds out private philanthropy in any sector government is involved in, or the general populace thinks "ought" to be involved.

fundamentalist writes:

Socialists have always tried to redefine socialism to make it more appealing to the masses. The started out calling themselves Progressives, then they perverted the word "liberal" by adopting it.

Most people that I talk to think of socialism as nothing but sharing. All public school students will encounter several times in their K-12 journey the humorous dairy cow economics. It starts out with you owning two cows. For socialism, the state takes one cow and gives it to your neighbor. The socialist system under cow economics is the least funny and least threatening. It was clearly written by socialists and it's doing a great job of brainwashing young people.

Maybe (if I'm lucky) I'll get an answer to this here:

"3. State power."

What difference does it make whether this top-down method of coordinating activity is implemented through the state? Can't private institutions be equally guilty of top-down control?

Hayek had the best way of defining socialism -- central planning. Centralized control of information -- either private or public -- is what facilitates coercion. Whether a state is involved is secondary, and will be of less and less concern going forward.

Les writes:


Of course private institutions can exercise top-down control over employees, customers, suppliers, etc. But anyone who objects to top-down control can leave and take their business elsewhere - to a competitor.

But with top-down control by the state there is no competitor - the state is a monopolist with coercive power. So anyone who objects to top-down control cannot simply leave and take their business elsewhere - unless they choose the extreme alternative of emigrating.

So the difference between the state and private institutions is enormous and profound.


Right, and my point is that the only reason people are getting confused about what socialism means is because states have less of a monopoly in exercising top-down control than they used to. It is easier than ever for people to move themselves and their money out of a jurisdiction if they don't like how they're being treated, and if some people realize their vision (like the Seasteaders), very local versions of government may emerge.

Conversely, it is easier than ever for some corporations to exercise top-down control over their customers and employees. How much say did anybody outside the top-level management at Bear, Lehman, Goldman, and JP Morgan get in whether or not we as a society were going to fund subprime loans?

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