Chapter 20 : The Question of Money

The Question of Money

One of the greatest challenges for anarchism must be to reject the production-based obsession of state communism and the market obsession of capitalism, and achieve a producer-consumer balance. Money and methods of replacing it were important and complex matters to be decided by the collectives. In the anarchist camp there were two distinct views on the matter. The first — that adopted by Kropotkin, called for the abolition of the wages system, advocating instead ‘dipping into stocks’, the socialization of resources and repudiation of any hint of pay differentials.

‘A society having taken possession of all social wealth, having boldly proclaimed the right of all to this wealth — whatever share they may have in producing it — will be compelled to abandon any system of wages, whether in currency or labor notes.’[127]

The second view, developed by anarchist theoretician Pierre Besnard was that money should be retained along with consumer vouchers, in order to eliminate speculation on loans, savings, etc. He also proposed a national wage system based on international stocks and bonds and, possibly, tied to gold. This approach was very similar to that of the American anarchists such as Josiah Warren who argued that the price of goods and services should be related to the costs of production and delivery instead of the capitalist market principle that ‘the price of a thing is that what it will bring’.

The revolutionary experiences which rocked Spain between 1931 and 1933 in Spain had helped Isaac Puente develop and clarify the ideas expressed in his important pamphlet Libertarian Communism. In Aragón, for example, during the December 1933 insurrection, Libertarian Communism had been declared and money abolished.[128] In the 1934 Asturian uprising the anarcho-syndicalist, socialist and dissident Marxist dominated areas, popular workers’ committees had spontaneously introduced a voucher system acceptable to traders so that people could acquire provisions.

The 1934 experiments had considerable resonance in Spain at the time. Even the hard-line Marxists of the BOC and the Spanish Communist Party (PCE) enthused about the Asturian workers’ achievements in monetary matters in spite of Marx and Stalin’s position on wage differentials. Thus, on the anarchist side, there was Besnard’s view of pay and money divested of their speculative and exploitative features and the Puente view which called for the abolition of the money system. In considering this question at the May 1936 Zaragoza Congress the CNT had hedged in its motion adopting libertarian communism by coming up with the ambiguous formula based on ‘the producer’s pass book’ issued by the appropriate union. The producers’ pass book allowed one to:

“consume, in accordance either with rationing or with their needs, all products distributed in the locality; to possess, for one’s own use, a suitable home, necessary furniture, a chicken run (on the outskirts), or an allotment, or a garden, should the collective so decide: to use public services: to take part in the voting on the decisions made in one’s factory, workshop, section, union and local federation.“

The war brought different responses to the question of money. We have the experiences of the CNT collectives that abolished money with dramatic symbolism in bonfires, then found they had to reintroduce it in a euphemistic guise later. At the same time collectives in Aragón and Catalonia found that barter developed naturally in times of crisis and that city collectives or enterprises often preferred produce to worthless paper money. Nevertheless, it must not be forgotten that barter is simply a negotiation over value defined in product terms, and is not immune to ‘market forces’. And just because money is not involved that does not take away the potential for exploitation or profiteering. Barter between nations for example would stop balance of payment problems, but only in the most vicious Thatcherite way. For example, a third world country needing energy is appallingly vulnerable when trying to exchange its major export commodity if it is either perishable or subject to fluctuations in demand. That is why stateless socialist societies must aim first and foremost for self-sufficiency, and trade must be limited to an exchange of surplus. Cash crop agriculture must be abandoned, providing of course that a sufficiently high level of food production is maintained for feeding the cities.

During the early and uncertain period that followed the military uprising the public services functioned normally as did the basic food provisioning of the city. There were no great demands on the system: each collective made an inventory of its resources and ideas as to what it might contribute to the revolution. The pay-scale was reorganized: the high salaries of directors and managers were abolished, the wages of skilled technicians such as engineers and foremen remained stable while laborers’ wages increased quite sizably. On 24 July, the Generalidad supported a move for less work and more pay by decreeing the 40-hour week and a fifteen per cent increase in wage levels. This was opposed by the CNT who called for greater productivity. Another trend was the introduction of the standard wage in the belief that prices were fixed. This presupposed that there would be no inflation and no black market, although one soon developed in Catalonia as it did throughout the rest of republican Spain.

Attitudes towards money also varied in the rural collectives. Some villages abolished money overnight, burning it symbolically in some instances, opting for immediate Libertarian Communism. Others chose to pool resources and issue local currency notes. But the circumstances of the revolution did not lend themselves to the sudden complete abolition of the money system, and it soon re-appeared in other guises. They did, however, go a long way towards abolishing the rule of money. Frank Mintz provides an interesting quote from the village of Bujalance in Córdoba, which underlines this ad hoc approach to money as a means of exchange:

‘Everything that has been done has been done right away, by way of an experiment. During the early days bonds were issued, entitling one to whatever one needed. Later this paper money was introduced and now we have adopted the producers’ card system. To date this is the best arrangement we have put into practice.’[129]

However, an important weakness of the ration card system was its implicit institutionalization of male superiority. In a ration-free system equality between the sexes and individuals is a de facto phenomenon. The introduction of the producers’ card and the retention of wage differentials between male and female workers meant that women in collectives, on the whole, earned substantially less than men. In the Italian edition of his book Leval notes:

‘in about half of the farm collectives, the wage paid to them (women) was less than that paid to men, in the other half it was about the same; these differences can be explained in terms of the fact that only rarely did a young woman live alone.’ [130]

Moreover, the family wage system, where wages were determined by the number of members, with wages for individuals adjusted according, made the spouse of a worker, usually a woman, dependent.

Another element common to both sorts of collective was the problem of exchange and procurement of goods from outside the collective. In all cases examined by Frank Mintz the basic reckoning was worked out in pesetas and a deal was then struck either in money, between the collective and an individual, or through barter, between collective and collective, wherever possible. The collectives contributed a portion of their produce free of charge and, occasionally, looked after refugees and convalescents.[131]

The majority of the collectives confined themselves to issuing a local currency or introducing a voucher system. This effectively compelled the rich, albeit indirectly, to join the collective or go under. Frank Mintz believes that the rich in the agrarian collectives underwent a radical change of circumstances, but only when the UGT and the CNT were working together as one; otherwise the Spanish Communist Party would establish a CP dominated UGT branch and protect the rich and those opposed to self-management.[132] In the towns the rich were rarely interfered with. When a particular system did not work the members of the collective simply replaced it with another system. The Congress of the Aragón Federation of Peasant Collectives, for example, decided to replace the local currency system, introduced shortly after the revolution had begun, with a uniform ration book, but they left it up to each individual collective to stipulate the quantity of items available to each family. Where the monetary system remained in use a ‘unitary wage’ was introduced. Failing this, attempts were made to reduce differentials between the highest aid lowest paid workers by introducing a national norm. According to Daniel Guérin, the units which adopted the collectivist principle of day wages were more stable than the few which opted for immediate, all out Libertarian Communism:

‘In some villages where currency had been suppressed and the population helped itself from the common pool, producing and consuming within the narrow limits of the collectives, the disadvantages of this paralyzing self-sufficiency made themselves felt, and individualism soon returned to the fore, causing the breakup of the community by the withdrawal of many former small farmers who had joined but did not really have a communist way of thinking.’[133]

These were just some of the complex questions and problems facing the collectivists which explain why the collectives did not go all the way and abolish the money system. Also, many of the members of the collectives were Catholics, social democrats, communists, or simply nonpolitical, and did not share the anarchist vision of a free society. However, perhaps the most important reason of all was the continued existence of the official economic and administrative structure of capitalism, the Generalidad and the Republican State.[134]