I've been thinking a lot about 19th century conceptions of socialism and of capitalism and I hope to be much clearer on certain distinctions now than I was when we first corresponded.
Let me first say that your article conflates the terms 'free market' and 'capitalism', which conflation will never allow us to progress in our understanding of the issues. Also, you need a sounder understanding of how the word 'socialism' has changed in the past century or two.
But I digress, back to my confusion - about Socialist and Communist-anarchists that is. If Socialism is defined as an extreme form of centralized authority, then how could any anarchist, with sound mind fuse the two?
Because social-anarchists do not define socialism as centralized authority.
The terms 'socialism' has become conflated with centralized-authority, just as the term 'capitalism' has become conflated with free markets. These are both dangerous confusions.
The social-anarchists are truer to the original conceptions of socialism than the more prevalent state-socialists.
Socialism was, as Benjamin Tucker summarized it, the position "that labor should be put into its own."
To understand what this means requires a reassessment of, for instance, the word 'capitalism'. In its strictest (and simplest) form, the term means only this: PROFIT FROM CAPITAL.
'Socialism', in a less-strict, but nevertheless accurate and simple form means: OPPOSITION TO CAPITALISM.
If I build a house and sell it to you, that is not capitalism, although it might be a free-market transaction.
If I lend you the money to build a house and charge you interest, that IS capitalism, and the anarchists (including Benjamin Tucker) claimed that the transaction did not take place in a free market.
Why isn't the first scenario capitalism? Because I didn't use capital to make my money -- I used my labor.
The labor theory of value was shared by the socialist and anarchist movements of the 19th century -- again, including Benjamin Tucker.
According to the labor theory of value, I did not profit from selling you the house I built. The price we negotiated was a price for my labor. If we agree on a price of 3,000 kilowatts -- or time-dollars, or bills of hemp-scrip or whatever free-market currency we're using -- then that was the value of my labor. I did not profit from my labor -- I was compensated for it. And the exchange of labor for currency is what allows me to acquire the things my labor itself cannot provide. (I'm ignoring for the sake of this illustration the issues of building-materials or land-property, which could lead to much longer conversations.)
In the second scenario, where I am the money-lender, I contributed nothing to your house but the use of my capital. I lent you US$100,000, and will, over time, make back US$300,000. So I've profited tremendously -- threefold -- and not for the contribution of labor, but for the temporary use of my capital. THAT's capitalism. The capital-ist makes twice as much as the laborer, when all of the value of the transaction (according to the labor theory of value, remember) was in the labor itself.
The argument is not just about money-lending capitalism (called 'usury'), but about any form of profit-from-capital rather than compensation-for-labor. The factory owner, borrows from the money-lender. The factory owner hires laborers. He pays them 5% or 10% the cost of their labor (based on what he sells their products for) -- and pays 15% or 20% to the lender. Over time, the factory-owner is making even MORE money than the lender did (for that individual loan) and neither of them is contributing any labor. The workers contribute all the value and receive the least compensation.
As the socialists saw it (and as they still see it), the sale-price of the final product determines the value of the labor that went into it. Since the laborers receive in currency only a tiny fraction of the value of their labor, the lender and the owner are stealing value from the workers –- literally stealing from them, the same way libertarians identify forced taxation as stealing.
You can see why capitalism was considered the exploitation of the workers.
Tucker's argument was, further, that capitalism could not succeed in a free market. Yes, really. Not only did he not define 'capitalism' and 'free market' similarly, but he believed that they were incompatible. He believed that capitalism could only succeed in the context of a state controlled monopoly on currency.
Why, Tucker asked, would you end up paying the money-lender US$300,000 unless the money-lender is working without adequate competition? If the house-builder is willing to accept hemp-scrip from the First Mutual Bank of Cannabis, and if the competition in labor-friendly Mutual Banks has driven the cost of interest down to the cost of doing the paperwork and paying clerical salaries (which Tucker estimated at less than 1%), then profit-from-mere-capital will be nominal to non-existent in a truly non-aggressive, non-coercive, free market.
I hope this helps you understand why the individualist anarchists
And Tucker was correct in identifying
I believe some confusion may have started when Tucker contrasted State Socialism and Anarchism in his book, Individual Liberty. He states both are forms of socialism because both have the same goal, but very different means of accomplishing that goal.
First, it's important to note that Benjamin Tucker never wrote a book called Individual Liberty.
As far as we can tell, Tucker never authored any book on any subject. Practically all his writing was for speeches or for publication in his own journal, Liberty. (And even the speeches ended up in the journal.)
The two books with his byline are INSTEAD OF A BOOK -- By A Man Too Busy To Write One and Individual Liberty. The first is Tucker's own anthology of his essays, articles, and editorials from the pages of Liberty. The second is a shorter, more edited compilation of his work, which Tucker knew about and approved of but did not directly participate in.
Tucker's essay, "State Socialism and Anarchism: How far they agree, and wherein they differ" was originally written as a magazine article for North American Review -- which paid for it but never published it. Tucker made it his leading article in Instead of a Book, and the editor of Individual Liberty decided to follow suit.
And so we have oxymorons like libertarian socialism, anarcho-communism, and redundant titles such as anarcho-capitalism peppered around the compass. Watch out for the anarcho-pacifists or the eco-anarchists, they are dangerous, somebody control them!
There is nothing oxymoronic or contradictory about the terms 'libertarian socialist' or 'anarcho-communist'. They are joint allegiances to individual freedom and to the labor theory of value. You and I share a disbelief in any successful, universal application of their values, but that predicted impracticality does not make their values self-contradictory.
And there is definitely nothing redundant about 'anarcho-capitalism'. 'Anarchism' and 'capitalism' are logically orthogonal terms. Like the left-anarchists, anarcho-capitalists have a joint allegiance: to free individuals and to free-market capitalism.
(And no, the term 'free-market capitalism' isn't redundant either.)
I do consider the term 'free-market anarchist' to be redundant, but only if one is strict in defining both terms.
I happen to think Tucker was wrong in his prediction: I think free markets would tolerate capitalism, and capitalism is probably even inevitable within any diverse and uncoerced marketplace -- as are, I suspect, both socialism and communism.
But I am neither an anarcho-capitalist nor a libertarian socialist. I have no such joint-allegiance. My only principled allegiance is to individual liberty.
The socialism-versus-capitalism dichotomy interests me as a study of history and a study of ideologies, but it has nothing to do with my principles.
And I suspect it would turn out to be a false dichotomy if we abandon single-solution thinking. A robust, diverse and unrestricted meta-market -- of free currencies, free strategies, and free choices -- would tolerate both.