Many people who come to the philosophy of liberty from the right hold on to their conservative talking points on corporations and unions. I came here from the radical left. So it was obvious to me that organized labor played a legitimate role in a free market and that corporations were a creation of the state. But I hadn’t committed a lot of time to forging my opinion.

Both unions and corporations are rooted in freedom of association, but it seemed to me that corporations limit legitimate liability, and unions violate freedom of disassociation. They seem fundamentally similar because they both mitigate economic liability with state force. But I wanted to check my own ex-liberal bias. So, I interviewed one person from each side, a radical unionist and a tea-party patriot, to talk me through the gaps in my understanding.

Unions

To tell me about unions, I interviewed a “Wobbly,” a member of the militant Industrial Workers of the World. The Wobbly identified as a socialist and a Green Party member. I asked him two basic questions: (1) Under current law, do unions have the power to force employees or employers to accept contracts, perform services, or relinquish wealth against their will? (2) In a stateless society, could unions function and flourish without those powers?

The first thing the Wobbly did was accuse me of sympathizing with evil tyrants “soaked in the blood of the workers.” He offered no responsive answer to my questions. When someone repeatedly dodges a moral question, it indicates to me that they know the answer and it hurts their position.

Once he calmed down, he told me that “Unions must have those powers, because if they put forth the effort of unionizing a factory, allowing nonunion workers to undermine strikes and direct actions would be a liability.” There’s that magic word, “liability.” So, like corporations, unions are designed to mitigate economic liability with force.

He assured me workers are under no compulsion to join a union, because they are free to quit their job. That’s really interesting, because he rejected exactly that argument when I claimed workers were under no compulsion to work for an employer.

If economic coercion is force for the employer, why isn’t it force for the union? The Wobbly said, “Owners have no motivation except profit, and unions represent the interests of the workers.”

That is exactly the answer statists give when I ask why a criminal protection racket is not legitimate but a state protection racket is. Criminals have no motivation except profit, they say, and the state represents the interests of the people. In other words, the Wobbly has no objection to coercion if it supports his goals.

Here’s where it falls apart for me: A job is just a relationship with an employer. A union is just an association of workers that collectively negotiates a relationship with an employer. Where does a union get the authority to prevent a nonunion worker from having a separate, independent relationship with an employer? That job is not theirs to terminate.

As for the state, the Wobbly told me, “I advocate for government to match the size of business. Right now I want big government to provide a check on big business. I also want the government to shrink proportional to business, preferring that both fade away completely.”

The Wobbly uses the imagery of enemies to classify employers as uniformly evil and to justify state force against both employers and workers in order to benefit unions. In reality, employers and workers are both human. They have the same right to associate, and the same right to disassociate. They have the same susceptibility to altruism and corruption. The voluntaryist position must be to support the workers’ right to freely organize, but also to defend the employer’s and the nonunion workers’ right to freely disassociate.

Corporations

To find out about corporations I interviewed a local tea-party patriot. He identified as a “libertarian-leaning Republican.” I really only had one question. How can someone claim ownership in something but not have liability?

The patriot responded the same as the Wobbly, by attacking me instead of answering the question. Instead of attacking my morality, he attacked my intelligence. He started throwing all these economic catastrophes at me as arguments.

First it was the railroads: if it wasn’t for corporations the Industrial Revolution never would have happened, because there would have been no railroads. (This argument I found about as persuasive as that old statist objection to anarchism, “who will build the roads?”) Then it was every modern convenience: Apple will stop building iPhones. Ford will stop building cars. He told me, “If you had even the most basic business knowledge, you’d understand.”

A corporation, like a union, is just an association of individuals with similar interests. Limited liability essentially means that the shareholders of a corporation can only lose the amount they invested, although they can profit many times more than this. If the corporation owes damages in excess of its assets it simply declares bankruptcy and the injured party is never made whole.

The patriot said that the “public good” accomplished by corporations would be impossible if shareholders were held fully liable, because no one would take on the risk of investment. He also argued that because shareholders are passive investors, it’s unjust to hold them liable for the failures of management.

What he’s ignoring is that management isn’t liable either. So somehow the shareholders, the managers, and the state are able to contract with each other to deprive an injured party of legitimate restitution.

It’s the promise of profit that encourages people to risk liability. If liability is no longer a factor, people will take greater risks and cause greater damage, which is what we see now. Liability is a market signal.

Also, the patriot’s response was a pragmatic answer to a moral question. Compensating the people you’ve damaged is a moral issue. If full liability discourages passive investment, and limited liability victimizes people who are neither shareholders nor managers, maybe passive investment is just a bad idea.

Liability is inseparably tied to ownership, just as profit is tied to loss. Legitimate liability is equal to the amount damaged, not the amount invested. To suggest otherwise is to say that an arsonist who burns a house down is only liable in the amount he invested in the matches. Limited liability is only beneficial for those who get to take risks without taking responsibility. To profit without risk contradicts everything I’ve studied about economics.

After my discussion with the patriot I’ve come to think of the situation like AIDS. The state is like HIV: the state is a virus that gradually destroys the natural immune system of the population. The corporation is just like the common cold or an opportunistic infection. It would be fairly benign if we had a robust immune system, but the state literally prevents us from competing with it.

AIDS is neither the virus nor the infection. It’s the combination of the two. Once the immune system is dangerously weak, the opportunistic infection is able to take over the host body system by system.

So the opportunistic infection kills the host, but avoiding the immunodeficiency in the first place is the only solution. You fight an infection by strengthening your immune system, not by strengthening the virus (HIV, the state) that destroys your immune system.

Force And Voluntaryism

It is possible to be in favor of a goal without being in favor of the coercive force people think they need to achieve it.

The long-term goal of the Wobbly was for workers to take over factories and own them in common (you know, like corporations). He thought the way to do this was to grant more and more coercive power to unions until they could take the factory by force. But is that really necessary?

It is entirely possible to achieve that goal without breaking voluntaryist principles. Workers could form a union where the dues usually collected to pay professional negotiators and lobbyists went into an escrow fund instead. Eventually, when the fund was large enough, they could buy the factory themselves — collective investment instead of collective bargaining.

Then those of us not interested in a worker’s revolution could keep our money, and not be partial owners when the goal is reached. I have no problem with workers forming a union, but I demand the freedom to disassociate, both from the union and the employer.

The limited-liability problem is not hard to resolve along voluntaryist principles either. In the current model, imagine that 100 people each invest a $1 share in a $100 corporate car, and then the car causes $150 of damage in a crash. Limited liability would suggest that each shareholder would only lose the $1 they invested, and the damaged party would have no claim to the remaining $50. Claiming that every shareholder is liable for the full $150 is also no solution, but you could replace limited liability with proportional liability: each shareholder would owe $1.50.

The system is currently proportional ownership and proportional profit. Why not add proportional liability and proportional loss?

These proposals aren’t far-fetched, but they met with hostility from both my interviewees. They both used a lot of words for the sake of their emotional weight rather than their definitions, which indicates a lot of propagandized thinking.

As anarchists and voluntaryists, we are in the unique position of advocating something that is both natural and counterintuitive for most people. Because it is natural, we know the seeds of it are already planted inside every person. We don’t need to plant the seeds. We only need to nurture them.

We are like Galileo proposing the heliocentric universe to a population whose entire worldview is shattered by it. They are hostile because they are afraid.

Conclusion

In conclusion, I want you to make an open palm and then grasp it into a fist. Now this is going to sound crazy, but that fist doesn’t exist. You don’t destroy a palm when you make a fist, and you don’t destroy a fist when you make a palm, because “palm” and “fist” are not things. Only language makes them seem so. They are something hands do. They should really be verbs, not nouns. Only the hand exists.

Similarly, “government,” “corporation,” and “union” should not be nouns; they should be verbs. They are something people do. Only the people exist — people doing things. These labels we use for groups of people have no independent existence. The same action cannot be evil for people calling themselves “corporation” and virtuous for people calling themselves “union,” just as it cannot be evil for people calling themselves “union” and virtuous for people calling themselves “corporation.”

This uncomfortable truth is precisely why anarchy is true and virtuous: because the people calling themselves “government” do things that any rational, intelligent being anywhere would recognize as evil if they saw normal people doing them.