On July 19th, 1936 the CNT, an anarcho-syndicalist union, and the UGT, a union affiliated with the Spanish socialist party, called a general strike in response to a fascist coup led by General Francisco Franco. The left-wing socialists tried to get the government to release arms to the workers so they could put down the coup, but the government refused. So the workers broke into the barracks and took the weapons themselves. After the workers had put down the coup the government decided to release arms to them. Franco's coup was defeated in two-thirds of Spain. A civil war was waged between the fascists and the anti-fascists for the next three years, which the fascists eventually won. In the aftermath of the defeat of Franco's coup the non- fascist parts of Spain underwent an anarchist social revolution, which was later suppressed by a counter-revolution led by the Spanish Communist party. This revolution shows an alternative to capitalism (and Stalinist tyranny) and that anarchy is possible; it worked in Spain. The counter-revolution is confirmation of the anarchist critique of the state and shows the treachery of Marxist-Leninists.
State power collapsed in the aftermath of the defeat of the fascist coup. Parliament still existed, but it had no power. The army was in rebellion against the government and the police had dissolved in the wake of the fighting. Power lay in the streets. The result was not chaos, but anarchy. Spain had a powerful anarchist movement organized mainly in the Iberian Anarchist Federation (FAI), a federation of anarchist affinity groups, and the National Confederation of Labor (CNT), an anarcho-syndicalist union. Anarcho-syndicalism is a form of anarchism that focuses on unions and the labor movement. Anarcho-syndicalists advocate forming revolutionary unions that would fight for improvements in the short term (better wages, working conditions, etc.) and revolution in the long term. This union would not be a normal bureaucratic union like the AFL-CIO but would be run along non-hierarchical lines, without a bureaucracy and based on decentralized direct democracy. Once this union was large enough it would declare a general strike, bringing capitalism to a halt, the government would be overthrown & abolished, and the workers would take over the means of production (factories, mines, land, etc.).
This is basically what happened after the defeat of Franco's coup. Throughout much of Spain workers seized the factories and peasants drove their landlords off the land. Non-hierarchical collectives were formed; workers ran the factories and peasants ran the farms. Self-management was implemented. Takeover of factories initially began as a response by workers to the abandoning of workplaces by their owners but soon spread to workplaces that hadn't been abandoned and shut down by their owners. Had this not happened the capital flight would have crippled the economy but by taking over production the workers' were able to get the economy back on its feet. Anarchists were not the only ones to carry out expropriation. Many members of the UGT expropriated their workplaces, even though the leadership of the UGT wanted nationalization, not self-management. Thousands acted like anarchists even if they didn't regard themselves as anarchists.
The specific organization of urban collectives varied from collective to collective, but most followed a few basic outlines. A worker assembly operating on directly democratic principles ran the factory or workplace. Assemblies would usually elect a committee to take care of administrative and coordination tasks. These factory committees were recallable and mandated. They had to follow the instructions of their worker assembly and had no power of their own. Members of the committee worked as ordinary workers and had no more power or privileges than anyone else. All major decisions were made in the worker assemblies; committees would only implement those decisions. The collectives saved a good deal of money by abolishing owners and bosses, since they no longer had to pay them huge amounts of money. The wages of the lowest paid workers was usually increased to decrease inequality between workers. The workers were able to quickly reorient much of the economy to a war footing, converting production into a war industry. Technicians and specialists (and sometimes former owners) were made advisors whose expertise was valued but they didn't have any power over others. Former owners who did not flee to the fascist side were usually made workers, equal to all the other workers.
The rural collectives tended to implement more radical policies than the urban collectives. Peasant assemblies based on directly democratic principles ran the collective. Most collectives elected a committee to take care of coordination and administrative tasks. Committees only carried out the decisions of the assemblies; the peasant assemblies made all major decisions. Those who did not want to join the collectives did not have to; they were given their own plot of land but no more then they could farm themselves. Just as they could not buy slaves they also could not employ wage-labor. Within the collectives land was cultivated in common and the produce shared equally. Supplies and necessities were usually stored in a common warehouse(s) from which things would be dispensed. Some collectives abolished money and implemented distribution based on the principle "from each according the ability to each according to need." People could freely take goods of which there were plenty; goods that were scarce were rationed. Most collectives that did not abolish money attempted to approximate the same principle by paying individuals on an egalitarian basis. Some collectives printed their own local money. Some started building their own small agro-industries. Many local doctors joined the collectives, providing their services for free and receiving the same as all collective members. Many collectives had a retirement age, after which members did not have to work, and some even set up special homes for the retired. Many of the retired grew bored, however, and chose to do some labor anyway. In most cases, the only external incentive to do productive labor was peer pressure. And it worked - many collectives produced even more than the old system.
Collectivization was not coerced and did not cover the whole economy, although it covered most of it. Many small businesses were not immediately collectivized but stayed under private ownership. Because collectivization was not based on coercion the decision to collectivize or not was up to the workers in each workplace and some of them didn't immediately expropriate their workplaces, although the expropriation of big businesses was near universal. The remaining petty bourgeoisie (small business owners) were fearful and paranoid about collectivization, often bringing them into conflict with the anarchists. Unlike full-blown capitalists, many small business owners are not ultra-rich and actually aren't greatly harmed by collectivization. They go from being a small business owner to being a worker equal to all others. In many cases collectivization did not adversely affect the former small business owners and may even have improved their lot. In Barcelona both the workers and owners of all the hairdressing parlors voluntarily decided to collectivize. At a general assembly they decided to shut down all the unprofitable shops and modernize all the remaining ones. The distinction between workers and owners was obliterated and, with the money saved, wages were raised. Former owners were not negatively affected, the workers were better off and the customers got better service. Despite the fact that small business owners didn't lose much in collectivization many were still paranoid and feared collectivization destroying their power over the few subordinates they had. Those small business owners who remained became significant backers of the counter-revolution led by the Communist party. The anarcho-syndicalists could probably have done a better job trying to win the petty bourgeoisie over to their cause and persuading them of the benefits of collectivization.
Initially market relations continued to exist in Revolutionary Spain. Markets were used to coordinate production between collectives. Self-managed collectives sold most of their products on the market, at first. Sometimes they would barter with each other; other times money was involved. This was a system of mutualism, not capitalism, because wage-labor was abolished even though market relations continued to exist. There was some inequality between collectives during this initial period, though this was much less inequality than exists in any capitalist society. It also led to a "factory patriotism" where members of different collectives tended to look out mainly for their own collective instead of the whole system. This was the case in the initial period; there were several forms of non-market non-hierarchical coordination between collectives established in the months following expropriation. This started on a local basis and later built on a larger basis. Immediately after the civil war started forms of loose coordination appeared to fight the war. Many collectives converted their workplaces to war production and others sent either money or useful materials (such as food) to both the militias fighting the war and the collectives on war production. In some cases there were joint assemblies with the workers of multiple workplaces. Sometimes industries were reorganized so as to be more efficient, shutting down inefficient plants and using more efficient ones more fully. Later, greater coordination was established between collectives by establishing confederations based on mandated and recallable delegates. Regional federations were formed, such as the Levant Federation of Collectives, formed just a few weeks after the revolution began, and in June 1937 a Plenum of peasant collectives was held. Equalization funds were established to reduce the inequality between collectives and sometimes there were direct transfers of resources between collectives. There were even instances of large groups of people moving from one collective to another in order to help out the poorer collectives. These measures were successful in reducing factory patriotism and inequalities between collectives. All of this was organized from the bottom up, with decision-making power in the hands of the assemblies. All major decisions were made in the popular assemblies running the collectives; delegates and committees simply carried out the instructions of the assemblies.
Even during the initial period of mutualism the collectives were economically productive as many eyewitness accounts attest. Overall the collectives worked at least as well as private capitalism, in some cases much better. Most of the cases where collectives were less productive than before expropriation were caused by the war though being bombed, shortages of raw material, etc. Even some opponents of the anarchists admitted that collectivization appeared to be a success. Rodolfo Llopis, a leader of the socialist party, admitted that it was the collectives who were able to get the economy going after the defeat of Franco's coup. Luis Portela, a leader of the Party of Marxist Unity (POUM), admitted that the collectives saved the economy at the start of the civil war.
