Just as individuals associate together to work on and overcome common problems, so would syndicates. Few, if any, workplaces are totally independent of others. They require raw materials as inputs and consumers for their products. Therefore there will be links between different syndicates. These links are twofold: firstly, free agreements between individual syndicates, and secondly, confederations of syndicates (within branches of industry and regionally). Let's consider free agreement first.

Anarchists recognise the importance of letting people organise their own lives. This means that they reject central planning and instead urge direct links between workers' associations. In the words of Kropotkin, "[f]ree workers would require a free organisation, and this cannot have any other basis than free agreement and free co-operation, without sacrificing the autonomy of the individual." [Kropotkin's Revolutionary Pamphlets, p. 52] Those directly involved in production (and in consumption) know their needs far better than any bureaucrat. Thus voluntary agreement is the basis of a free economy, such agreements being "entered by free consent, as a free choice between different courses equally open to each of the agreeing parties." [Peter Kropotkin, Anarchism and Anarchist Communism, p. 52] Without the concentration of wealth and power associated with capitalism, free agreement will become real and no longer a mask for hierarchy. So anarchists think that "[i]n the same way that each free individual has associated with his brothers [and sisters!] to produce . . . all that was necessary for life, driven by no other force than his desire for the full enjoyment of life, so each institution is free and self-contained, and co-operates and enters into agreements with others because by so doing it extends its own possibilities." [George Barrett, The Anarchist Revolution, p. 18] An example of one such agreement would be orders for products and services.

This suggests a decentralised economy — even more decentralised than capitalism (which is "decentralised" only in capitalist mythology, as shown by big business and transnational corporations, for example) — one "growing ever more closely bound together and interwoven by free and mutual agreements." [Ibid., p. 18] For social anarchists, this would take the form of "free exchange without the medium of money and without profit, on the basis of requirement and the supply at hand." [Alexander Berkman, ABC of Anarchism, p. 69]

Therefore, an anarchist economy would be based on spontaneous order as workers practised mutual aid and free association. The anarchist economy "starts from below, not from above. Like an organism, this free society grows into being from the simple unit up to the complex structure. The need for . . . the individual struggle for life . . . is . . .sufficient to set the whole complex social machinery in motion. Society is the result of the individual struggle for existence; it is not, as many suppose, opposed to it." [George Barrett, Op. Cit., p. 18]

In other words, "[t]his factory of ours is, then, to the fullest extent consistent with the character of its service, a self-governing unit, managing its own productive operations, and free to experiment to the heart's content in new methods, to develop new styles and products. . . This autonomy of the factory is the safeguard. . . against the dead level of mediocrity, the more than adequate substitute for the variety which the competitive motive was once supposed to stimulate, the guarantee of liveliness, and of individual work and workmanship." [G.D.H. Cole, Guild Socialism Restated, p. 59]

This brings us to the second form of relationships between syndicates, namely confederations of syndicates. If individual or syndicate activities spread beyond their initial locality, they would probably reach a scale at which they would need to constitute a confederation. At this scale, industrial confederations of syndicates are necessary to aid communication between workplaces who produce for a large area. No syndicate exists in isolation, and so there is a real need for a means by which syndicates can meet together to discuss common interests and act on them. Thus confederations are complementary to free agreement. Bakunin's comments are very applicable here:

"[A] truly popular organisation begins from below, from the association, from the commune. Thus starting out with the organisation of the lowest nucleus and proceeding upward, federalism becomes a political institution of socialism, the free and spontaneous organisation of popular life." [The Political Philosophy of Bakunin, pp. 273-4]

Given that Bakunin, like many anarchists, considered that "the federative Alliance of all working men's [sic!] associations . . . [would] constitute the Commune," the political institutions of anarchy would be similar to its economic institutions. Indeed, Bakunin argued for a "free federation of agricultural and industrial associations . . . organised from the bottom upwards" to be the basis of a revolution (in 1905 and in 1917, revolutionary workers and peasants did exactly that, we should note, when they created soviets — Russian for councils — during their revolutions). Hence Bakunin's comments on "political" institutions and federalism are applicable to a discussion of economic institutions. [Michael Bakunin: Selected Writings, p. 170 and p. 172]

A confederation of syndicates (called a "guild" by some libertarian socialists, or "industrial union" by others) works on two levels: within an industry and across industries. The basic operating principle of these confederations is the same as that of the syndicate itself — voluntary co-operation between equals in order to meet common needs. In other words, each syndicate in the confederation is linked by horizontal agreements with the others, and none owe any obligations to a separate entity above the group (see section A.2.11, "Why are anarchists in favour of direct democracy?" for more on the nature of anarchist confederation).

Kropotkin's comments on federalism between communes indicate this (a syndicate can be considered as a producers' commune):

"The Commune of tomorrow will know that it cannot admit any higher authority; above it there can only be the interests of the Federation, freely accepted by itself as well as other communes. . ." [Words of a Rebel, p. 83]

Nor need federalism conflict with autonomy, as each member would have extensive freedom of action within its boundaries:

"The Commune will be absolutely free to adopt all the institutions it wishes and to make all the reforms and revolutions it finds necessary." [Op. Cit., p. 83]

Moreover, these federations would be diverse and functional. Economic federation would a produce a complex inter-networking between associations and federations. In Kropotkin's words:

"Our needs are in fact so various, and they emerge with such rapidity, that soon a single federation will not be sufficient to satisfy them all. The Commune will then feel the need to contract other alliances, to enter into other federations. Belonging to one group for the acquisition of food supplies, it will have to join a second group to obtain other goods, such as metals, and then a third and a fourth group for textiles and works of art." [Op. Cit., p. 87]

As such, the confederations reflect anarchist ideas of free association and decentralised organisation as well as concern for practical needs:

"Anarchists are strenuously opposed to the authoritarian, centralist spirit . . . So they picture a future social life in the basis of federalism, from the individual to the municipality, to the commune, to the region, to the nation, to the international, on the basis of solidarity and free agreement. And it is natural that this ideal should be reflected also in the organisation of production, giving preference as far as possible, to a decentralised sort of organisation; but this does not take the form of an absolute rule to be applied in every instance. A libertarian order would be in itself, on the other hand, rule out the possibility of imposing such a unilateral solution." [Luigi Fabbri, "Anarchy and 'Scientific Communism", pp. 13-49, The Poverty of Statism, Albert Meltzer (ed.), p. 23]

Therefore, a confederation of syndicates would be adaptive to its members needs. As Tom Brown argued, the "syndicalist mode of organisation is extremely elastic, therein is its chief strength, and the regional confederations can be formed, modified, added to or reformed according to local conditions and changing circumstances." [Syndicalism, p. 58]

As would be imagined, these confederations are voluntary associations and "[j]ust as factory autonomy is vital in order to keep the Guild system alive and vigorous, the existence of varying democratic types of factories in independence of the National Guilds may also be a means of valuable experiment and fruitful initiative of individual minds. In insistently refusing to carry their theory to its last 'logical' conclusion, the Guildsmen [and anarchists] are true to their love of freedom and varied social enterprise." [G.D.H. Cole, Op. Cit., p. 65]

As we noted, in the last section, inter-workplace federations are not limited to collectivist, syndicalist and communist anarchists. Proudhon, for example, suggested an "agro-industrial federation" as the structural support organisation for his system of self-managed co-operatives. As the example many isolated co-operatives have shown, support networks are essential for co-operatives to survive under capitalism. It is no co-incidence that the Mondragon co-operative complex in the Basque region of Spain has a credit union and mutual support networks between its co-operatives and is by far the most successful co-operative system in the world.

If a workplace agrees to confederate, then it gets to share in the resources of the confederation and so gains the benefits of mutual aid. In return for the benefits of confederal co-operation, the syndicate's tools of production become the "property" of society, to be used but not owned by those who work in them. This does not mean centralised control from the top, for "when we say that ownership of the tools of production, including the factory itself, should revert to the corporation [i.e. confederation] we do not mean that the workers in the individual workshops will be ruled by any kind of industrial government having power to do what it pleases with [them]. . . . No, the workers. . .[will not] hand over their hard-won control. . . to a superior power. . . . What they will do is. . . to guarantee reciprocal use of their tools of production and accord their fellow workers in other factories the right to share their facilities [and vice versa]. . .with [all] whom they have contracted the pact of solidarity." [James Guillaume, Bakunin on Anarchism, pp. 363-364]

Facilitating this type of co-operation is the major role of inter-industry confederations, which also ensure that when the members of a syndicate change work to another syndicate in another (or the same) branch of industry, they have the same rights as the members of their new syndicate. In other words, by being part of the confederation, a worker ensures that s/he has the same rights and an equal say in whatever workplace is joined. This is essential to ensure that a co-operative society remains co-operative, as the system is based on the principle of "one person, one vote" by all those involved the work process.

So, beyond this reciprocal sharing, what other roles does the confederation play? Basically, there are two. Firstly, the sharing and co-ordination of information produced by the syndicates (as will be discussed in section I.3.5), and, secondly, determining the response to the changes in production and consumption indicated by this information. As the "vertical" links between syndicates are non-hierarchical, each syndicate remains self-governing. This ensures decentralisation of power and direct control, initiative, and experimentation by those involved in doing the work. Hence, "the internal organisation [of one syndicate] . . . need not be identical [to others]: Organisational forms and procedures will vary greatly according to the preferences of the associated workers." [Ibid., p. 361] In practice, this would probably mean that each syndicate gets its own orders and determines the best way to satisfy them (i.e. manages its own work and working conditions).

As indicated above, free agreement will ensure that customers would be able to choose their own suppliers, meaning that production units would know whether they were producing what their customers wanted, i.e., whether they were meeting social need as expressed through demand. If they were not, customers would go elsewhere, to other production units within the same branch of production. We should stress that in addition to this negative check (i.e. "exit" by consumers) it is likely, via consumer groups and co-operatives as well as communes, that workplaces will be subject to positive checks on what they produced. Consumer groups, by formulating and communicating needs to producer groups, will have a key role in ensuring the quality of production and goods and that it satisfies their needs (see section I.4.7 for more details of this).

However, while production will be based on autonomous networking, the investment response to consumer actions would, to some degree, be co-ordinated by a confederation of syndicates in that branch of production. By such means, the confederation can ensure that resources are not wasted by individual syndicates over-producing goods or over-investing in response to changes in production (see the next section).