Is Anarchism Utopian?

Depends on the definition, if anarchism is defined from the etymology of anarchy or chaos, then it is not even utopian but dystopian.

Let us do away with ideology first and deal with facts.

If anarchism is defined as statelessness, then the utopian claim is false, for one simple reason: the origin of human society had been WITHOUT the  state.

Human society emerged from the prehistoric stateless hunter-gatherer societal relationship

Notes the Wikipeida.org (bold mine)

Hunting and gathering was the ancestral subsistence mode of Homo. As The Cambridge Encyclopedia of Hunter-Gatherers says: "Hunting and gathering was humanity's first and most successful adaptation, occupying at least 90 percent of human history. Until 12,000 years ago, all humans lived this way." 

What characterizes the hunter gatherer societies?

From another Wikipedia.org article (bold mine)

Hunter-gatherers move around constantly in search of food. As a result, they do not build permanent villages or create a wide variety of artifacts, and usually only form small groups such as bands and tribes. However, some hunting and gathering societies in areas with abundant resources (such as the Tlingit) lived in larger groups and formed complex hierarchical social structures such as chiefdoms. The need for mobility also limits the size of these societies. They generally consist of fewer than 60 people and rarely exceed 100. Statuses within the tribe are relatively equal, and decisions are reached through general agreement. The ties that bind the tribe are more complex than those of the bands.Leadership is personal—charismatic—and used for special purposes only in tribal society. There are no political offices containing real power, and a chief is merely a person of influence, a sort of adviser; therefore, tribal consolidations for collective action are not governmental. The family forms the main social unit, with most societal members being related by birth or marriage. This type of organization requires the family to carry out most social functions, including production and education.

In other words, 90% of human history has been about tribal anarchism.

The origin of the government came during the transition from hunter-gatherer to the agricultural age or the evolution towards pastoral societies.

Pastoralism is a slightly more efficient form of subsistence. Rather than searching for food on a daily basis, members of a pastoral society rely on domesticated herd animals to meet their food needs. Pastoralists live a nomadic life, moving their herds from one pasture to another. Because their food supply is far more reliable, pastoral societies can support larger populations. Since there are food surpluses, fewer people are needed to produce food. As a result, the division of labor (the specialization by individuals or groups in the performance of specific economic activities) becomes more complex. For example, some people become craftworkers, producing tools, weapons, and jewelry. The production of goods encourages trade. This trade helps to create inequality, as some families acquire more goods than others do. These families often gain power through their increased wealth. The passing on of property from one generation to another helps to centralize wealth and power. Over time emerge hereditary chieftainships, the typical form of government in pastoral societies.

From the above account the protection of private property played a significant role in ushering the state.

There are modern day examples of stateless tribal anarchist societies, Somalia—until recently before the  forced introduction of government through the intervention of the US government—and Southeast Asia’s Zomia.

Now let us inject the ideological philosophical component of anarchist societies. 

According to the Wikipedia.org there are several schools of thought, mutualism, individualist anarchism and social anarchism (which is broken down into collectivist anarchism, anarcho-communism, anarcho-syndicalism).

There are even several offspring of ideological anarchism. The internet seems like an example of crypto-anarchism.

As to whether these ideological anarchism are utopian or not is beyond the scope of this post.

The bottom line is that anarchism as defined by statelessness has been an integral part of human society. They are anything but utopian.

Post Hurricane Sandy: Signs of Spontaneous Order in New York City

Observes Jaltcoh (hat tip Econolog’s Professor David Henderson)

The traffic in the blackout areas of Manhattan is lawless in the most literal sense: the traffic lights aren't working, so the law cannot be applied as usual. But "lawless" doesn't seem to be a fitting description; the driving seems better-behaved than usual. We're so used to seeing people act under a system of government rules that it's easy to assume that without the rules, everything would descend into chaos. But perhaps free people are generally capable of acting decently on their own. Of course, that's never going to be universal; but then, people break the law too. In fact, a dense set of rules tempts people to see how close to (or how far across) the borderline of legality they can go without being penalized. In the absence of governmental laws, people might focus more on other kinds of laws: social norms and ethics.

Contra Hobbes, these serve as anecdotal evidence that people are hardly endemically nihilistic.

Is Greece Falling into a Failed State?

According to the mainstream media and establishment experts, Greeks supposedly loathed austerity. They wanted “growth”, which is a euphemism for continued unsustainable government spending. If true, then this means that Greeks wanted free lunch.

But many Greeks may have come to realize that there is NO such thing as a free lunch. They needed to pay taxes in return for political entitlements.

Yet Greeks have been balking at doing so.

From Reuters.com/GreeceReporter.com

With anxiety mounting that Greece might vote for anti-austerity parties in the June 17 elections and be forced to leave the Eurozone of 17 countries using the euro as a currency, more Greeks – already legendary tax evaders – have stopped paying taxes. A senior Finance Ministry official on May 23 said that tax revenues have fallen 10 percent while two tax officials who declined to be named told Reuters that May revenues fell by 15-30 percent in tax offices away from the major cities and relative wealth centers of Athens and Thessaloniki.

So Greeks have been refusing to pay taxes. The left hand does not know what the right hand is doing. That’s if the establishment’s assertion is true. Greeks cannot have it both ways.

Yet Greeks realize that if they cannot pay, then they would have to default on their debts.

But the establishment says that the only way to salvation is through devaluation that can only be actualized from an exit. So their prescription: Default by devaluation.

So this ‘exit’ prospect gives further jitters not just to the average Greeks, but to foreign businesses based on Greece, as well. Foreign businesses have been apprehensive about having inadequate laws to cover or protect them once Greece decides to exit.

From the New York Times,

What can companies do when the legally impossible becomes reasonably probable?

Under European Union law, Greece cannot leave the euro. That is the theory. But in practice, any protection the law offers investors could be difficult to enforce, according to lawyers trying to protect their corporate clients against the upheaval sure to follow if Greece were to default on its debts and adopt a new currency.

So their advice is blunt: Remove cash and other liquid assets from Greece and prepare to take a short-term hit on any other investments…

But, apart from trying to ensure that debts are paid promptly and therefore in euros, legal options for companies are limited. Contracts covered by Greek law, particularly for services delivered in Greece, provide little protection against the currency’s being redenominated and devalued — a development regarded as unlikely until recently.

“Greece would, through its laws, be able to amend contracts governed by Greek law or to be performed within the territory of Greece,” Mr. Clark said. “It is the governing law and the place of performance of the contract that is most important.”

International contracts, which might be covered by British, German or Swiss law, would be more likely to be honored in the designated currency, though in some cases the wording of the legal document may be vague.

And even if the law is on their side, companies would find that to extract payment from a Greek company, they would need a judge in Greece to enforce a ruling from a foreign court.

When the average Greeks doesn’t want to pay taxes, and when foreign businesses are either closing shop or transferring elsewhere, then this means that there will be insufficient tax revenues for the current government to finance her survival.

This also means that parasites have severely impaired the hosts, which may mean the prospective extinction of the parasitical relationship.

From FT/IBNLive.in

Greece's public finances could collapse as early as next month, leaving salaries and pensions unpaid unless a stable government emerges from the June 17 election, according to Lucas Papademos, the technocrat prime minister who left office after this month's inconclusive vote.

Mr Papademos warned that conditions were deteriorating faster than expected with cash flow likely to turn negative in early June amid a sharp fall in tax revenues and a loosening of spending controls during two back-to-back election campaigns.

Mounting anxiety that Greece is headed for further political instability and a possible exit from the euro has prompted many Greeks to postpone making tax payments, and has also accelerated outflows of deposits from local banks.

Athens bankers estimate that more than €3bn of cash withdrawn since the May 6 election has been stashed in safe-deposit boxes and under mattresses in case the country is forced to readopt the drachma.

Austerity becomes a NATURAL process as economic reality has been reasserting itself. This exposes the promises of a "state based elixir" as monumental delusion.

The prescription of devaluation has been provoking a bank runs and has been blowing up right ON the faces of establishment experts calling for devaluation.

This brings us to where the Greece might be headed for.

The new Deutsche bank boss calls Greece as a "failed state".

From Irish Times,

The incoming co-chief executive officer of Deutsche Bank today described Greece as a "corrupt" and "failed" state.

"Greece is the only country, I feel, where we can say 'it's a failed state,' it is a corrupt state, corrupt as far as its political leadership is concerned, and obviously other people had to be willing to support this," Juergen Fitschen, who takes up his post next week, said in a speech at a conference in Berlin.

Failed states, are characterized according to Wikipedia.org by

• loss of control of its territory, or of the monopoly on the legitimate use of physical force therein,
• erosion of legitimate authority to make collective decisions,
• an inability to provide public services, and
• an inability to interact with other states as a full member of the international community.

Often a failed state is characterized by social, political, and/or economic failure.

In reality “failed states” are mainly products of unsustainable parasitical relationships, whether in Somalia, Chad or Sudan as rated by US think tank Fund for Peace and Foreign Policy.

But this does not necessarily mean social, political and economic failure as commercial operations exists. Otherwise logic says that these nations will have been uninhabited or deserted either through diaspora or death. But this has clearly not been the case.

Ironically, the US Central Intelligence Agency even admits that the number one “failed state” Somalia as having a “healthy informal economy”.

Thus the “inability to provide public services” does not represent reality. The difference is that mainstream cannot swallow or fathom such ideas. And the global political establishment has been repeatedly attempting for “failed states” to go mainstream through foreign interventions.

Instead, what a “failed state” means is that there is no standing government or that imposed government will mostly likely be ignored by society or what could be called “stateless society”.

I am not sure if Greece will technically become a failed state.

What is certain is that we are witnessing the accelerating collapse of a parasitical relationship anchored upon the spendthrift welfare and bureaucratic state.

This validates anew the great Ludwig von Mises who presciently warned more than half a century ago that

An essential point in the social philosophy of interventionism is the existence of an inexhaustible fund which can be squeezed forever. The whole system of interventionism collapses when this fountain is drained off: The Santa Claus principle liquidates itself.

And like Dr. Marc Faber, the collapse of the current Greece form of government should be bullish for Greeks over the long term (whether through exit or as part of the EU), as Greeks will be compelled to live within the laws of economics through greater economic freedom, and eschew feeding on political parasites.

The Geopolitics of Oil and Russia’s Knowledge Economy

Writes the Institutional Investor at the Minyanville

All it would take for Russian President Vladimir Putin’s regime to begin to crumble would be for the price of oil to slump to the $70-a-barrel range, former Secretary of State Condoleezza Rice told an audience last week.

Speaking at Everest Capital’s Emerging Markets Forum in Miami, Rice said that if the price of oil remains above the $100-a-barrel mark during the next few years, Putin’s Kremlin would have the means to continue paying off cronies and keeping the current regime — which she described as an “oil syndicate” — intact. With crude currently hovering around $110 a barrel, she said, there is no incentive for Russians to change the nature of their economy.

But the days of a Russia fueled exclusively by petrodollars is waning, especially if the price of crude begins to fall, she said. Ready to replace Putin’s petrostate is a knowledge-based economy crying to break free, said Rice, also a former national security adviser to President George W. Bush and an expert on the Russian political economy. “Wouldn’t it be refreshing to see that the basis of Russian power is the knowledge and creativity of its people? They could be a very big part of the 21st century,” she said.

Rice told the audience at the emerging markets summit a story about how the former president, Dimitri Medvedev, once boasted to her that Russia produced the world’s finest mathematicians. Her response: What if they were actually working in Moscow instead of in Palo Alto and Tel Aviv? She said that Medvedev acknowledged that Russia needed to provide an ecosystem in which its homegrown talent would remain at home and help the country flourish. “The arts and sciences in Russia have been legendary even in the worst of times. Can you imagine how remarkable their economy could be if their leading scientists weren’t leaving for Silicon Valley?” she said.

Besides being extraordinarily dependent on oil, Putin’s regime has done little to censor or monitor the Internet compared to, say, China, according to Rice. The former KGB agent focuses his attention on producing state television broadcasts reminiscent of the Cold War Era — an old-line communist activity that matters little to a younger generation of Russians who receive their news over the Internet, she said.

There are two things of note here:

1. The geopolitics of oil simply posits that the survival of many of the resource dependent welfare states have been moored to high oil prices. That’s because the political leadership uses revenues from resources to buy off the public’s support to maintain their privileges (usually known as the resource curse).

The same desire to use revenues to finance pet projects of politicians also serves at the main incentive for the political leadership around the world, including the Philippines, to engage in resource nationalism during commodity booms

Yet take away the lofty price oil, say by allowing free markets to work and all these autocratic regimes, such as Iran, Venezuela and etc…, collapses. So war will never be necessary for any regime changes. Just allow free markets to clear and despots and tyrants will subsequently vanish.

But the problem is that many western friendly autocratic welfare states are also dependent on elevated oil prices like the GULF states.

Also Obama’s green energy/jobs policies depends on high oil prices too.

The Investor’s Business Daily recently noted that

Energy Secretary Steven Chu admits the administration has no interest in bringing them down…At a hearing this week, Rep. Alan Nunnelee, R-Miss., specifically asked Chu if "the overall goal" of the administration is to "get our price down." Chu's answer was no.

Since this implies that deeply entrenched vested interest groups are in command of the political environment—whose survival again greatly depends on lofty oil prices—the geopolitical imperatives will focus on the manipulation of oil supply and demand, war mongering and importantly inflationist policies. In short, oil politics greatly influence, not only national welfare politics, but also foreign policies.

So while governments may pretend to express care about consumers affected by high oil prices (say by imposing subsidies, cash giving out cash transfers and etc.) and subsequently pin the blame on private companies for greed, in reality, the geopolitics of oil is about the preservation of political entitlements through redistribution of resources from consumers to the political clients (mostly oil producers and allied industries) and their political leadership patrons.

Only free markets will undo such political economic inequality.

2. Russia’s growing knowledge economy is a demonstration of how the internet has been functioning as a pivotal force in reshaping the world’s political economy.

The internet helps spur the development of commercial activities that operates in circumvention of stifling regulations that fosters more underground economy.

Chart from pyramid research

Underground or informal or shadow economies are symptoms of arbitrary and unenforceable laws, lack of property rights, byzantine red tape, high tax regimes, choking bureaucratic regulations, corruption, weak institutions and other political impediments to commerce.

The share of informal economy to Russia’s economy is one of the highest in the world. So as with the Philippines.

I recently quoted the investment guru Doug Casey which I find relevant in the discussion of informal economies,

If you're going to have a ridiculous number of impossible laws, corruption is a good thing. Increasingly, what matters is not the number or even nature of laws on the books in the place you live, but the amount of actual control the state has over private individuals. Corruption subverts idiotic laws; it's the next best thing to abolishing them.

Aside from corruption, big informal economies are to paraphrase Mr. Casey, symptomatic of the subversion of “idiotic” laws. The other way to say this is that anarchy emerges, as expressed by the existence of informal economies, out of the abject failure of the incumbent political order for these political economies.