The libertarian confusion from me citing evidence that the Chinese government forced peasants off land (and hence de facto into factories) as a criticism of the capitalist mode of production is evidence of a broader problem with libertarian methodology. For while libertarian methodology is supposedly about individuals satisfying their utility maximising preferences, you could argue that, more frequently, libertarians approach things from the perspective of two institutions: ‘governments’ and ‘markets’.
This leads to a lot of problems, not just because governments and markets are regularly framed as opposed to each other, when in fact they are mutually reinforcing when managed right. No, the problem is that, through their governments versus markets lens, libertarians see states throughout history as roughly equivalent. So when I criticise Commie China in an argument against capitalism, how can that work? I’m criticising capitalism, and hence advocating statism, which is synonymous with ‘communism’, which is the opposite of capitalism. So I’ve refuted myself!
For me, this is where marxist class analysis offers the most rich and appealing methodological starting point. We are able to understand the actions of states in their historical context and as distinct from each other. The Social Democratic Scandinavian states have highly successful high tax, high spend policies. On the contrary, the EZ project is an example of massive unrepresentative bureuacracy failing, spectacularly. Now, if we approach this from a ‘governments versus markets’ perspective we’re sort of stuck. Libertarians resort to insisting that Sweden isn’t really that social democratic and does well because of low corporate tax rates and lack of regulation*. Leftists often find themselves trapped on the ‘governments’ side of the equation and as such find themselves reluctant to criticise the state.
But if we approach it from a class perspective, and see the state – slightly glibly, admittedly – as simply advancing the interests of a particular class at any one time, then things make a lot more sense. In the case of Scandinavia, the lower/middle class are exercising their democratic preferences for the distribution income/goods and services, and in the case of the EZ the political elite/creditor class are trying to allocate as much income as possible to themselves.
There are plenty more examples of governments and markets failing to analyse situations properly – for example, libertarians often cite the fact that the state is in bed with financial institutions as evidence that the crisis was not caused by true capitalism but by the ‘government’ side of governments and markets. Of course this is incoherent; financial institutions neither represent the state or the market, and the best way to describe them is as the elite class – which can include elected politicians, landlords, financiers, and whoever else – rigging the system in their favour.
Another example is the fact that American peasants were not, AFAIK, forced into factories, whilst British ones were. What libertarians might consider two conflicting pieces of evidence are better understood in terms of class: a legitimate democratic state founded on the idea of capitalism in the case of the former, and collusion between the landlords/merchant class imposing capitalism on an unwilling peasantry in the latter. Governments and markets would have trouble dealing with historical events like this.
Libertarians, naturally, have an objection to class because of its association with marxism, collectivism and ‘envy’. But really class is just a far superior tool for analysis. For whilst class representations are inherently collectivist, they are not incompatible with individualist analysis; they can simply be thought of an emergent property, and we can analyse the economy on two different levels, which Libertarians already do with governments and markets. And governments and markets glosses over the institutions required to sustain them, but class is a straight representation of people and so doesn’t take existing legal structures for granted, leading to a less hamstrung analysis. Furthermore, class analysis quickly highlights unjust hierarchies and structures that have been created by current institutions, things that should be rejected by anyone who purports to be in favour of liberty.
*If you follow those links neither of those claims stand up to much scrutiny.