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"Essential Mutualism means parity, equity and guardianship.

PARITY = on a par by using benchmarking and measuring tools.

EQUITY – fair share achieved by linking what you contribute to what you receive.

GUARDIANSHIP = giving conscious non-authoritive support by watching out for mission drift, refusing to over-look corrupting activities, avoiding false argument that distracts from purpose, and having honest reasons for including or excluding people." (


1. From the Wikipedia:

"Most Left-Libertarians advocate Mutualism as an alternative to capitalism, including Anarcho-Syndicalists though Syndicalists often advocate for the eventual transition into a moneyless society based purely on mutual aid. Most left-libertarians reject capitalism in its current form if not entirely even in its non-statist forms.

Mutualism emerged from early nineteenth-century socialism, and is generally considered a market-oriented strand within the libertarian socialist tradition. Mutualists typically accept property rights, but with brief abandonment time periods. In a community in which mutuality property rules were upheld, a land-owner would need to make (more or less) continuous use of her land; if she failed to do so, her ownership rights would be extinguished and the land could be homesteaded by someone else. A mutualist property regime is often described as one rooted in “possession,” “occupancy-and-use,” or “usufruct.


Drawing on the work of Rothbard during his alliance with the left and on the thought of Karl Hess, some thinkers associated with market-oriented American libertarianism came increasingly to identify with the Left on a range of issues, including opposition to war, to social and cultural hierarchies, and to corporate hierarchies and corporate-state partnerships. One variety of this kind of libertarianism has been a resurgent mutualism, incorporating modern economic ideas such as marginal utility theory into mutualist theory. Kevin A. Carson's Studies in Mutualist Political Economy helped to stimulate the growth of new-style mutualism, articulating a version of the labor theory of value incorporating ideas drawn from Austrian economics” (


"Mutualism is an economic theory and anarchist school of thought that advocates a society where each person might possess a means of production, either individually or collectively, with trade representing equivalent amounts of labor in the free market.[1] Integral to the scheme was the establishment of a mutual-credit bank that would lend to producers at a minimal interest rate, just high enough to cover administration. Mutualism is based on a labor theory of value that holds that when labor or its product is sold, in exchange, it ought to receive goods or services embodying "the amount of labor necessary to produce an article of exactly similar and equal utility". Mutualism originated from the writings of philosopher Pierre-Joseph Proudhon.

Mutualists oppose the idea of individuals receiving an income through loans, investments, and rent, as they believe these individuals are not laboring. Though Proudhon opposed this type of income, he expressed that he had never intended " forbid or suppress, by sovereign decree, ground rent and interest on capital. I think that all these manifestations of human activity should remain free and voluntary for all: I ask for them no modifications, restrictions or suppressions, other than those which result naturally and of necessity from the universalization of the principle of reciprocity which I propose."[4] Insofar as they ensure the worker's right to the full product of their labor, mutualists support markets (or artificial markets) and property in the product of labor. However, they argue for conditional titles to land, whose ownership is legitimate only so long as it remains in use or occupation (which Proudhon called "possession");[5] thus advocating personal property, but not private property.

Though mutualism is similar to the economic doctrines of the nineteenth-century American individualist anarchists, unlike them, mutualism is in favor of large industries. Mutualism has therefore been retrospectively characterized sometimes as being a form of individualist anarchism, and as ideologically situated between individualist and collectivist forms of anarchism as well. Proudhon himself described the "liberty" he pursued as "the synthesis of communism and property."

Mutualists have distinguished mutualism from state socialism, and do not advocate state control over the means of production. Benjamin Tucker said of Proudhon, that "though opposed to socializing the ownership of capital, [Proudhon] aimed nevertheless to socialize its effects by making its use beneficial to all instead of a means of impoverishing the many to enrich the subjecting capital to the natural law of competition, thus bringing the price of its own use down to cost."" (

3. The Mutualist Tradition,

Kevin Carson:

"Mutualism, as a variety of anarchism, goes back to P.J. Proudhon in France and Josiah Warren in the U.S. It favors, to the extent possible, an evolutionary approach to creating a new society. It emphasizes the importance of peaceful activity in building alternative social institutions within the existing society, and strengthening those institutions until they finally replace the existing statist system. As Paul Goodman put it, "A free society cannot be the substitution of a 'new order' for the old order; it is the extension of spheres of free action until they make up most of the social life."

Other anarchist subgroups, and the libertarian left generally, share these ideas to some extent. Whether known as "dual power" or "social counterpower," or "counter-economics," alternative social institutions are part of our common vision. But they are especially central to mutualists' evolutionary understanding.

Mutualists belong to a non-collectivist segment of anarchists. Although we favor democratic control when collective action is required by the nature of production and other cooperative endeavors, we do not favor collectivism as an ideal in itself. We are not opposed to money or exchange. We believe in private property, so long as it is based on personal occupancy and use. We favor a society in which all relationships and transactions are non-coercive, and based on voluntary cooperation, free exchange, or mutual aid. The "market," in the sense of exchanges of labor between producers, is a profoundly humanizing and liberating concept. What we oppose is the conventional understanding of markets, as the idea has been coopted and corrupted by state capitalism.

Our ultimate vision is of a society in which the economy is organized around free market exchange between producers, and production is carried out mainly by self-employed artisans and farmers, small producers' cooperatives, worker-controlled large enterprises, and consumers' cooperatives. To the extent that wage labor still exists (which is likely, if we do not coercively suppress it), the removal of statist privileges will result in the worker's natural wage, as Benjamin Tucker put it, being his full product.

Because of our fondness for free markets, mutualists sometimes fall afoul of those who have an aesthetic affinity for collectivism, or those for whom "petty bourgeois" is a swear word. But it is our petty bourgeois tendencies that put us in the mainstream of the American populist/radical tradition, and make us relevant to the needs of average working Americans. Most people distrust the bureaucratic organizations that control their communities and working lives, and want more control over the decisions that affect them. They are open to the possibility of decentralist, bottom-up alternatives to the present system. But they do not want an America remade in the image of orthodox, CNT-style syndicalism.

Mutualism is not "reformist," as that term is used pejoratively by more militant anarchists. Nor is it necessarily pacifistic, although many mutualists are indeed pacifists. The proper definition of reformism should hinge, not on the means we use to build a new society or on the speed with which we move, but on the nature of our final goal. A person who is satisfied with a kinder, gentler version of capitalism or statism, that is still recognizable as state capitalism, is a reformist. A person who seeks to eliminate state capitalism and replace it with something entirely different, no matter how gradually, is not a reformist.

"Peaceful action" simply means not deliberately provoking the state to repression, but rather doing whatever is possible (in the words of the Wobbly slogan) to "build the structure of the new society within the shell of the old" before we try to break the shell. There is nothing wrong with resisting the state if it tries, through repression, to reverse our progress in building the institutions of the new society. But revolutionary action should meet two criteria: 1) it should have strong popular support; and 2) it should not take place until we have reached the point where peaceful construction of the new society has reached its limits within existing society." (

4. Race Mathews:

"Let me at the outset recall the nature, purpose and proud history of the worldwide mutualist movement of which credit unions are an integral part.

Mutualism is about self-help through co-operation – about resolute and principled households combining to bring about, through their shared efforts and enterprise, outcomes that would be unachievable for them in isolation from one another. Mutuals invariably emerge consequent on unsatisfied needs, as a means whereby access is obtained to goods and services that otherwise would be unavailable or unaffordable.

For example, the Rochdale Pioneers – the twenty-eight poor cotton weavers who established their co-operative store in 1844 and thereby gave rise to the modern consumer or retail co-operative movement – were responding to an unsatisfied need for affordable household necessities such as food and fuel. Friendly societies were a response initially to an unsatisfied need for funeral benefits, and later for unemployment benefits, sickness benefits and medical and hospital care.

Access to affordable life assurance was offered by mutual life assurance societies, as was access to affordable home loans by building societies. Agricultural processing and marketing co-operatives met a pressing need on the part of farmers to share in the value added to their produce.

Worker co-operatives responded to the need on the part of workers for secure employment by enabling them to own their workplaces and jobs – by enabling labour to hire capital rather than capital labour. Trade unions were originally mutualist bodies or co-operatives, formed by employees in response to the need to obtain better working conditions and a just price for their labour.

Credit unions in their turn were at first a response to the need for affordable carry-on loans for smallholder farmers, and later for affordable consumer finance. For example, when my wife and I bought our first home in 1958, our housing loan from our bank was for a thirty-year period at a fixed interest rate of 3 1/2 per cent. However, when households like ours came to put sea-grass matting on the floor as was fashionable at the time, a simple refrigerator in the kitchen and a single-tub washing machine in the laundry, we were referred by our banks to hire purchase companies for loans at interest rates in effective terms of up to 60 and 70 per cent. As a result, families in the outer suburban Catholic parishes of Australia’s major cities began to gather round card tables after Mass, pool such savings as they had and queue to borrow from the pool at interest rates that were affordable for them. In this way, parish credit unions were born. A little later, neighbouring non-Catholic households looked over the church fences, saw what a good thing the Catholics had going for them and secured admission, thereby causing the parish credit unions to become community credit unions. Later again, some trade unions recognised that workplaces were every bit as much communities as were suburbs, and industrial credit unions were established. So obviously right was the credit union idea, and so urgent the need for affordable consumer loans, that Australian credit unions now have more than 3 million accounts – equal to one in every six of our population - and assets under management of more than $A23 billion.3 What follows logically is that mutuals must be sufficiently flexible to adapt to changing needs and circumstances – must be able to recognise when the needs for which they are established no longer exist, are less pressing, or are being met on as favourable terms by other businesses and agencies. For example, the interest rates that my younger children, who are marrying today, will pay to a credit union for loans will be no less than is freely available from banks and a wide range of other conventional financial intermediaries, and the rate they receive for deposits will be no greater." (


Kropotkin on Mutualism

Kropotkin, in his book, Mutual Aid, "described the concept of mutualism, and what is now known in the natural sciences as Symbiosis:

A soon as we study animals — not in laboratories and museums only, but in the forest and prairie, in the steppe and in the mountains — we at once perceive that though there is an immense amount of warfare and extermination going on amidst various species, and especially amidst various classes of animals, there is, at the same time, as much, or perhaps even more, of mutual support, mutual aid, and mutual defence amidst animals belonging to the same species or, at least, to the same society. Sociability is as much a law of nature as mutual struggle. Of course it would be extremely difficult to estimate, however roughly, the relative numerical importance of both these series of facts. But if we resort to an indirect test, and ask Nature: "Who are the fittest: those who are continually at war with each other, or those who support one another?" we at once see that those animals which acquire habits of mutual aid are undoubtedly the fittest. They have more chances to survive, and they attain, in their respective classes, the highest development and bodily organization. If the numberless facts which can be brought forward to support this view are taken into account, we may safely say that mutual aid is as much a law of animal life as mutual struggle; but that as a factor of evolution, it most probably has a far greater importance, inasmuch as it favors the development of such habits and characters as insure the maintenance and further development of the species, together with the greatest amount of welfare and enjoyment of life for the individual, with the least waste of energy." (


Race Mathews:

"All that is best and finest about mutualism has its antithesis - its dark side - in demutualisation. Demutualisation – the conversion of memberowned mutualist bodies such as mutual assurance and insurance societies, friendly societies, credit unions and co-operatives into shareholder-owned proprietary limited companies – has recently become so widespread as to call into question the survival of mutualism as a significant force for economic and social well-being and community renewal in our new century. It is so prevalent as to have acquired its own vocabulary. The term ‘carpet-bagger’ is widely used in Britain for the large numbers of people who have been joining permanent building societies in order to vote for their demutualisation and share in the distribution of their assets. ‘Serial carpet-baggers’ are those who join successive building societies in order to profit from successive demutualisations. There are also ‘carpetbagger’ clubs that organise bids to demutualise mutuals, and ‘carpetbagger’ vulture funds that invest in bringing about demutualisations. It is estimated that, in the case of a failed attempt to demutualise the giant UK Nationwide Building Society, 600,000 of the 4.6 million members qualified to vote had joined the society immediately prior to the poll for the expression purpose of bringing about its demutualisation.

I am reminded of the sequence in Johnny Woo’s 1996 film ‘Broken Arrow’, where the chairman of the US Joint Chiefs of Staff calls a senior presidential aide on Air Force One to report ‘Sir, we have a Broken Arrow’.

Asked by the aide ‘What’s that?’, the chairman explains that a nuclear weapon has been high-jacked. The aide replies ‘I don’t know what’s more worrying: that it’s happened or that you’ve got a word for it’. It is a sad commentary on our times that the need for words such as ‘demutualisation’ and ‘carpet-bagger’ should have arisen, or that they should in so relatively short a space of time have achieved so widespread a currency. That so many mutuals have rushed lemming-like to demutualisation is due less to any intrinsic merits in the claims made for demutualisation than to the fact that it has to date largely escaped sufficiently comprehensive and rigorous scrutiny. That claims for demutualisation on the grounds of efficiency and effectiveness are not necessarily well-based, that major ethical and social issues arising from demutualisation have not been addressed and that the demutualisation process is dangerously open to misrepresentation and manipulation is apparent from demutualisations such as of the Sunstate Credit Union and the insurance arm of the National Roads and Motorists’ Association (NRMA). Both the Sunstate and the NRMA Insurance experiences raise key demutualisation issues not least for credit unions, that call for rigorous scutiny."

Demutualisation and lifecycle theory:

"The prevalence of susceptibility to perverse incentives to demutualisation is consistent with social movement theory. Social movement theory teaches that there is a lifecycle in the affairs of credit unions and other mutualist bodies that falls into three stages. There is, in the first instance, a utopian stage, where the vision and commitment of the founders energise their followers and enable the mutual to be established; secondly, a stage where the mutual assumes a more formal and institutional character in order to more effectively go about achieving its objectives; and, finally, a stage – usually referred to as the ‘system’ stage – where bureaucracy takes over, and the survival and self-interest of the organization assumes precedence over the interests of its members whatever functional purpose it was originally intended to serve. Social movement theorists characterise the cycle in its entirety as comprising a ‘generation-degeneration’ process. The challenge for mutuals is to ensure that the degeneration phase of the cycle does not occur." (

Re-targeting Mutualist Capital

Race Mathews:

"Mutuals must constantly reinvent themselves and re-target their resources so as to respond to new needs or those that are being experienced more widely or with greater urgency. In this way they avoid becoming what is referred to technically as ‘frozen’ mutuals. Re-invention in no sense means that credit unions should cease to be providers of affordable personal loans, but rather that perhaps radically innovative additions to their product mix should be adopted as changing opportunities and obligations may dictate. The operative concept is not ‘instead of’ but ‘as well’.

What is central here is respect for the principle of the conservation of mutualist capital. Each generation of members of a mutual adds to its store of savings in the expectation that they will be passed on for the benefit of generations still to come. Mutualist bodies are in this sense trustees for the intentions of the dead and the inheritance of the unborn. It was not by accident that the names of some early mutuals included the word ‘perpetual’. Change as may the purposes for which a mutual’s capital is employed in conformity with changing circumstances, that it should be retained intact on behalf of the community is fundamental and mandatory.

The acclaimed science-fiction author Arthur C. Clarke has noted in his 2001: A Space Odyssey that ‘Behind every man now alive stand thirty ghosts, for that is the ratio by which the dead outnumber the living’. So too there stand behind current members of mutuals those who have gone before them, and ahead those still to come. Mutuals take seriously Chesterton’s definition of tradition as ‘the democracy of the dead’

There is no shortage of mutualist bodies that have adapted to new community needs and thereby re-invigorated themselves, re-established their relevance and retained the involvement of their members. For example, a major US co-operative – Co-operative Services Inc of Oak Park in Michigan – was formed in the 1930s in response to an urgent local need for affordable, hygienic household milk delivery services. When the commercial dairies moved in with comparable services at a comparable price, the co-operative re-invented and re-tasked itself, so that the community capital it had accumulated was applied to meeting the need for affordable eye testing and spectacles.

Following the arrival of the optometric services corporations, the cooperative re-tasked its capital again, to meet the need for affordable accommodation and support services for older people. It now operates large apartment complexes – self-governing co-operatives within the over-arching structure of the parent body – in several states. Other examples of mutuals re-inventing or re-positioning themselves include the great complex of manufacturing, retail, financial, civil engineering, service and support co-operatives – now known as the Mondragon Co-operative Corporation (MCC) - at Mondragon in the Basque region of Spain, which I have discussed in detail in my 1999 book Jobs of Our Own: Building a Stakeholder Society, and the Canadian Desjardins credit unions that are discussed in my 2002 blue book Turning the Tide: Towards a Mutualist Philosophy and Politics for Labor and the Left.

Closer to home – and on a much more modest scale – the Cobar Cooperative in NSW began as a traditional co-operative butter factory, and is now a retail co-operative meeting the needs of its customers and also keeping honest conventional competitors such as the giant supermarket chains. The former Macleay butter factory co-operative also has become a retail co-operative, and currently is planning an expansion into petrol sales and the establishment of a parking station and entertainment complex. Faced as the respective communities of Cobar and Macleay have each found themselves with the question of whether the assets of these mutuals should be re-targeted in response to a perceived new need or demutualised and distributed to its members, each of them has favoured the re-targeting option." (


Lecture: A Future or No Future: Credit Unions in a Globalising Economy


Address to be Delivered by the Hon Dr. Race Mathews at the 41st Annual Conference of the New Zealand Association of Credit Unions, Hamilton, NZ, 12 September, 2003.

More Information

Bibliography of Mutualism, at

The book, Mutualist Political Economy, by Kevin Carson, is online at

Mutualist Links, at