What is Mutualism?
Mutualism is an early form of socialism that grew out of the working-class movements of nineteenth-century France and America. It aims at a society of small producers, farmers and cooperatives, who trade with each other on fair terms. Mutualists reject two things at once: the rule of the state and the profit that landlords and bankers draw from owning rather than working. They want people to hold what they use, and to be paid the full value of their labor. Credit would be offered at cost by mutual banks, and workplaces would be run as cooperatives. Unlike many socialists, mutualists accept markets and money. They argue that markets only work for the people when the unfair privileges of rent and interest are removed.
Core beliefs
- Workers should receive the full product of their labor.
- Possession based on use is legitimate, but absentee ownership and rent are not.
- Credit should be offered at cost through mutual banks, so that interest and usury fade away.
- Production should be done by cooperatives and associations of workers.
- Exchange should be fair, with goods swapped at the cost of the labor put into them.
- Society should be a federation of free communities, not a centralized state.
History
The French printer and writer Pierre-Joseph Proudhon gave mutualism its best-known form. His book What Is Property? (1840) answered its own question with the famous claim that property is theft, by which he meant the income that comes from owning rather than working. In 1849 he tried to set up a Bank of the People to offer free credit, but it closed within months after he was jailed. In America, Josiah Warren ran a Time Store in Cincinnati in 1827, where goods were priced by the labor spent on them. William B. Greene wrote on mutual banking in 1849, and Benjamin Tucker later promoted similar ideas in his journal Liberty. Karl Marx attacked Proudhon in The Poverty of Philosophy (1847). Proudhon's followers were important in the First International, and mutualist ideas also influenced the Paris Commune of 1871. In The Principle of Federation (1863), Proudhon described a society of linked self-governing communities.
Variants
Proudhon's own version blended economic reform with family traditionalism and a federal political order. American individualist mutualists such as Warren, Greene and Tucker put more weight on personal liberty and free banking. Some later writers fold mutualism into wider anarchist or libertarian socialist currents. The idea of mutual aid, made famous by Peter Kropotkin, is a related but different idea about cooperation in nature and society.
Criticisms
Marxists argued that reforming credit and exchange cannot touch the deeper structure of capitalism, in which workers still sell their labor. Economists doubt that prices can be set by labor time or that interest-free credit could last. Critics from the right say that a society of small producers cannot match the efficiency of large firms. Proudhon himself is criticized for opposing women's equality and for hostile remarks about several groups, views that most later mutualists rejected. Supporters respond that the core ideas of cooperative ownership and mutual credit do not depend on those opinions.
In practice
Mutualism has left its mark mostly through institutions: credit unions, cooperative banks, mutual insurers, building societies and worker cooperatives. The Mondragon network in the Basque Country is a well known cooperative group, though it did not call itself mutualist. On the 12 axes it scores at the extreme of Democratic on Authority, strongly toward Local on Structure, and toward Free on Markets, a mix that sets it apart from most socialist traditions.