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anarcho-capitalism

Some Thoughts on Minarchism (HT: Will Wilkinson)

by adam on February 25, 2009 · 2 comments

Will Wilkinson is blogging thought-provokingly, as usual. I recommend reading his “Small and/or Limited Government: Some Distinctions” post in its entirety. Aspects of his post speak directly to issues I am addressing as I work up my thoughts on voluntary society (anarcho-capitalism) and minarchist government in the process of writing about taxation. Below are some quotations from Will’s post with my comments.

Minarchist libertarians seem to be a bit embarrassed by the concessions they do make on the way to arguing for a state, and so stick as close as they can to their anarchists friends without going all the way stateless. But the anarchists are right that the minarchists have, in some sense already “given away the store,” and that it would be pretty surprising if the logic of the minarchist argument allowed them to stop where they do [boldface emphasis added by me— Adam].

Indeed, how could it stop them? Especially once it has developed the legal basis and coercive apparatus needed to finance itself by taxation, the State will only fail as its increasingly parasitic behavior deprives the wealth creators upon whom it relies for transfusions to sustain itself of so much of their own blood that they collapse.

Anarchists often argue that if the public goods argument for state protection of rights (and the system of public finance it implies) is sound, then there is no principled basis for stopping at “minimal” government.

I don’t see how the principle of limited government can withstand the government growth incentives introduced by the Power to tax. This is not a purely theoretical statement. We look at history and do not see governments, even those that begin with explicit limits on their use of power and explicit legal protections of individual liberty and private property rights, limiting themselves as their tax powers become more entrenched and more severe. We see such governments expanding themselves constantly and always at the involuntary expense of individual liberty and private wealth and economic freedom. Will Wilkinson hopes he has a solution to this phenomenon. A central planner’s fatal conceit? Or is Will onto something!

The scope of legitimate government will be however wide the logic of the public goods or market failure argument happens to take you. There are a number of possible minarchist replies here (the specialness of the use of coercion in the rights protection business, etc.), but I basically think the anarchist critique is correct. If there is something especially unstable in private markets for rights protection, and that fact justifies public provision of that service, then there might be other kinds of market failures that justify the public provision of those markets’ services [boldface emphasis added by me— Adam].

Anarchists and minarchists and people with a wide variety of political perspectives must see that American society is currently being buffeted by extravagantly costly public policy initiatives based on incessant “market failure” justifications. For example, Obama keeps saying that industries are failing because credit isn’t flowing. He then proposes a spending spree to address this that is, in fact, a series of mind-shatteringly massive wealth transfers that have little to do with solving the so-called credit crisis. Ultimately, the unprecedented empowerment and expansion of the State undertaken by Obama’s administration and Congress is preventing markets from adapting to reality. Government, especially one with the Power to tax, no longer views its power and scope as limited by moral principles or by the consent of the people or by credible economic theories. Will wants to change that, but I’m not convinced he or anyone can.

When Will referes to “unstable” free market solutions he is (probably) primarily concerned with the possibility that the market will fail to provide sustainable, consistent enforcement of private property rights. Or is he? Because his solution is to posit that the involvement of the government would result in a desirable form of stability.  I consider this an open question. How should the problem of upholding individual liberty and private property rights be solved? Should people be subject to solutions dictated by the State, or should the complex adaptive system of the market be permitted to offer solutions according to evolutionary forces, such as the profit and loss system of capitalist competition?

Full disclosure: I have lost confidence in the State and therefore no longer think of government as the Prime Mover of my political idealism. Most people already respond to natural and practical incentives to conform their behavior to the moral limits of mutual consent in their personal and professional lives, and I believe that products and services would emerge to serve rights-bearing individuals’ libertyloving, private property protecting interests reliably and sustainably. In posts to come, I’ll try to imagine some of the solutions to the problem of upholding liberty and private property rights in a society without government (and with governments that do not have the Power to tax). I think it’s important to confess that I don’t think I have all of the answers. When I look around my home at the computers and tv and microwave and iphone and clothes, I realize that I benefit every day from people I’ll never meet whose answers to question I’d never dream up have resulted in products I benefit from profoundly. Markets enable us to benefit from the specialized knowledge of strangers we may never meet. Such is the wonder of markets and the basis of my confidence in them. As Hayek pointed out, our wealth in a free market can be said to reside largely in the opportunities created for us by the ability to access the extensive knowledge of other individuals—designers, scientists, doctors, artists, engineers, chefs, clothiers, etc.— through simple exchanges of value, trades using money we’ve earned in accordance with our own individual preferences. In the absence of government provided protections of liberty and private property rights, markets would develop a range of solutions, I have no doubt.

Robert Higgs, in Crisis and Leviathan, demonstrates how professional politicians throughout history have responded opportunistically to crises by promoting the belief that only government experts can adequately address them. They thrive on a sense of crisis even when there are no empirical data to support the claim that one is underway, or even when State actions themselves actually precipitated a crisis. Politicians leverage “critical” moments to justify all manner of urgent action by the State, which invariably leads to government growth and interventionism. Will might agree that this has been a harmful trend over time, however, his response is to develop a principled stand in defense of what he sincerely hopes would be a sustainable limited form of government, one that has the Power to tax and also to provide for public goods that the market fails to provide as effectively as the State. Will is invoking a crisis, too. He is proposing that individual liberty and private property rights will cease to be adequately defensible without government, markets will no longer function without government. He is also saying that if the government intrudes on liberty and private property rights, the results will range from suboptimal to calamitous.

The claim behind my version of  ”liberaltarianism” is that there is a principled position between classic night-watchman “minarchism” and full-on modern liberalism. If you’re not an anarchist or totalitarian, then you think that it’s possible for the state to do either too little or too much.

There’s no justification for the coercive tax-financing of state enterprises when those good and servives would be provided (usually with higher quality and a lower price) with no state coercion. Also, state enterprises will tend to crowd out private enterprises both by (a) absorbing capital and using it badly and (b) by virtue of its inherent advantages in securing anti-competitive subsidies and barriers to entry, which is all the more reason to limit government to the things we actually need it for.

Explicitly, then, Will is conceding a justification for coercive tax-financing to state enterprises as part and parcel of a principled stand based on the objective superiority of markets to provide some goods in some cases and the objective superiority of the State in providing other goods in other cases.

Presumably, Will would expect those distinctions to be discovered by a rigorous scientific method, and, of course, that method would account for the specific circumstances of different localities, and for the preferences and desires and tolerances of individuals living in one place as opposed to another. Would this process be a government function, and, if not, in what way would the government be bound by its determinations? If a government function, wouldn’t this process also be influenced by the priorities of professional politicians and special interest groups. In Drift and Mastery, Walter Lippman describes committees of leading experts in their fields making determinations about the optimal configurations of industries. Would Will follow a similar approach, some committees of researchers developing reliable, transparent methodologies for drawing these distinctions and other committees calculating appropriate tax rates?

Would professional politicians not respond to the presence of this Power to tax in the way that they always have? How does the market defend itself against Will’s government once those who run it decide to expand their use of power? Frankly, this all sounds all too familiar to me. Though I applaud the spirit of what Will is proposing, especially because I share most of his values, I feel dread at the prospect that government would, once again, have enough power to break free of the constraints initially placed on it by Will.

Will writes:

If the collective action problems inherent in the provision of certain public goods justifies taxation, then a state that collects taxes for this purpose does not violate property rights.

Let’s rephrase that in accordance with the reality of taxation as we know it today. (I wonder if Will’s version of taxation be implemented differently?) The State is justified in using coercive intimidation and following through on threats of fines or assets seizure or imprisonment to compel from citizens wealth and property that they would not voluntarily give under the condition that the State uses taxation to address “collective action problems inherent in the provision of certain public goods.” I don’t fathom how this seemingly fundamental but ultimately vague principle would even contribute to slowing government growth, let alone to reversing it.

Government has caused and facilitated more murder, starvation, poverty, malnutrition, belligerent mayhem, racism, sexism, arbitrary prohibitions, and other inhumane behavior than any other man-made instrument in the history of our species. To the extent that it has stayed out of people’s lives or intervened solely on behalf of defending liberty and private property rights, humans have benefited, leading longer and wealthier lives. Will is willing to accept the risks of having a State with coercive power for the possible reward of having one that strikes the right balance between public and private goods. I am not convinced that statist solutions can do that. When I don my original minarchist costume, which still fits in many ways, but is a little dusty, I’m still insistent that the State should not have the Power to tax, which I see as a fast track to unlimited government.

I am inspired and excited by markets. Free, peaceful, purposeful, unplanned human action has delivered unexpectedly, unpredictably life-enhancing outcomes in every field of human endeavor. So that’s where my confidence lies when I envision an ideal society.

Of course, I will warmly welcome every step toward a society freer than the one we live in today, and over what promises to be a long journey toward a significantly freer society, liberaltarians, minarchists and anarchists can and should celebrate together every victory that restrains governments and liberates markets.

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Dear Fellow Anarcho-Capitalists… Yes, I’m Talking to You!

by adam on January 15, 2009 · 4 comments

It may come as a shock to some (or many… okay, most) of you to think of your lived experiences in the following way, but there can be no doubt that those of you living in the U.S. lead your lives as de facto anarcho-capitalists.

Here’s what I mean.

You wake up amongst possessions that you consider your private property, and it is your operative assumption that only you and those to whom you give permission may use or borrow those possessions. You wake up in a place where you expect that you have privacy and security, where you have the right to lock the door and do as you please. You can eat an entire bag of almond M&Ms. You can read Rand and Marx and the NYTimes. You can weep and laugh your way through a chick flick and nobody will ever know.

Throughout the day, you peacefully interact with people, from family and friends to coworkers and strangers. And by peacefully, I don’t mean there aren’t loud arguments or even that some of those relationships won’t end badly. By peacefully, I mean that you don’t force people to interact with you against their will (ie, at the point of a gun), and vice versa. Your operative assumption is that all of your interactions are based on voluntary, mutual consent. You assume that if anyone were to attempt to coerce or defraud you, you would be within your rights to resist those attempts and hold them accountable for bad behavior.

Your relationship to your employer or client or whomever you have business dealing is fundamentally voluntary. The operative assumption is that each of you is made wealthier by your engagement, and that either one of you may terminate the relationship, peacefully.

At the grocery market or pizza parlor or consumer electronics store, the operative assumption is that you will select what you want and pay for it, or browse through the store and leave without anything. The operative assumption, the basis for all of trade, is that neither you nor those with whom you are transacting can legitimately be forced to make a trade against your will, and that any trade that does take place will involve mutually agreed upon exchanges of value.

Generally, your days go smoothly because most other people share these operative assumptions. This set of anti-coercive rules are so widely accepted that we consider them social norms. Yes, there are also laws against behaviors that contradict these assumptions, most people behave well not because they fear the consequences of breaking a law but because they are simply not inclined to be aggressive or fraudulent. Most of them are also intuitively sensitive to the adverse impact on their lives, not legally but socially, of tarnishing their reputation by being jerks or bullies or deceivers.

These operative assumptions/social norms are instilled in most of us at an early age. Young children believe they are entitled to everything, but they learn that isn’t the case through repeated experiences to the contrary. They hear, “That doesn’t belong to you, it belongs to him/her. If you want something, you can’t simply take it. You need to ask permission to use things that don’t belong to you. And if you don’t get permission, even after trying to be persuasive, you simply have to move on.” Eventually, when more socially experienced children resist giving back something they’ve borrowed, all they need to hear is, “Does that belong to you?” and most immediately relinquish the item or, on their own initiative, ask for permission to continue using it. Children don’t have money, but they are taught about the the responsibility of reciprocation (ie, that values cannot simply be received without some form of compensation) every time they’re encouraged to say, “Thank you,” in response to a favor or gift or similar receipt. They are properly shamed and humiliated for taking or aggressing or lying: “You wouldn’t want somebody to do that to you, right? How would you feel if somebody did that to you?” Some reply by pointing out that another child their age did something wrong, or even (gulp) that you did something just like what they did. What do you say? “Two wrongs don’t make a right, honey. I was wrong when I did that, too. I won’t do it again and neither should you. Now say you’re sorry.”

Children clearly learn by imitation. Most adults say “please” and “thank you” during exchanges, and they pay for food and other things at the market in a ritualized way (ie, money visibly changing hands), and most don’t ever resort to threatening or initiating force. In popular entertainment, social norms are embedded in tales of adventure or dramas involving justice. Children are always watching and learning social norms.

I’ll say it again. Self-identifying Democrats, Republicans, Socialists, Green Party people (Greenions? Greenites?), Independents, Libertarians, and Socialists are, especially long before and soon after elections, good anarchocapitalistic folks.

Consider the way you conduct your personal and professional lives. You’re generally not concerned with running anyone else’s life; on the other hand, you insist on running your own. You choose to rely upon and honor mutual consent, to resist coercion and interference with your peaceful pursuits, to respect the private property and privacy rights of others and expect the same in return, and to honor the capitalist code of voluntarily exchanging value for value.

You want four fully-stocked varieties of oranges and imported cheese around the block. You want the movie today and the book tomorrow and a trip to the beach next Summer and Bounty instead of the alternatives. You want entrepreneurial competition, the chance to get ahead in your career as your expertise grows. You want a vibrant marketplace, the chance to enhance or change your wealth-generating activities. Unfettered spontaneous, individual human action produces the dynamic setting for an opportunity-rich, highly individualized life. Especially if you were born in the U.S., one of your operative assumptions is that this will always be the case.

You’re all anarcho-capitalistic insofar as you prefer to lead a life on your own terms, peacefully and uninterfered with.

In light of that, there’s hope that you will find within yourselves reasons to halt your support for the coercive and fraudulent tactics that the vast majority of professional politicians undertake. There’s hope that you’ll grasp that your distance from the effects of your votes is never an excuse for endorsing the initiation of force (“How would you feel if somebody did that to you?”) to re-allocate wealth (“Does that belong to you?”).

When you search your heart for the reasons you do not personally take the time and initiative to coerce your family, friends, neighbors and fellow citizens, do you find any moral basis for voting to empower a surrogate to do that very thing? Behavior you would never accept in our personal life, you not only tolerate but even endorse among professional politicians. Why? The alchemy of yours and their good intentions?

Would you care about the intentions of somebody who bullied and stole from you? Do the intentions of a child or adult matter when they take what doesn’t belong to them and refuse to give it back?

Professional politicians butter their bread by breaking the backs of the social norms embedded in our peaceful approach to life. They cherish conflicts of interest, because such conflicts produce enthusiastic, highly motivated donors. Political careers are made by artfully choosing sides in manufactured conflicts where some parties have much to gain at the involuntary expense of others.

Politicians’ promises to you and me about hope and change you can believe in? Their claims that massive wealth transfers from you to corporations are critical for the salvation of the economy? Their assertions that transferring wealth from the private sector to the government and then back to the market is the first and best expression of compassion? These promises, claims, and assertions are the rationalizations of cult leaders who have placed their bets based on your apathy regarding the social norms they violate with impunity. Why do you comply with their devastating behavior when two wrongs cannot possibly make anything right?

Dear fellow anarcho-capitalistic citizens, you cannot for long love freedom in between your votes to empower those who despise it. How can you choose the side of professional politicians against your own daily libertyloving assumptions and expectations?

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The Wire

by adam on January 6, 2009 · 0 comments

As of this weekend, I’ve now watched all five seasons of The Wire. Wow.

I hope that people will find the time to rent/buy seasons of this series and appreciate its place among the best television shows/documentaries every produced. The Wire’s commitment to developing an intimate understanding of its characters’ contexts, incentives and motivations, and its challenging presentation of intricate, multi-layered storylines requires patience (episodes do not wrap up neatly a la Law and Order), but then rewards that patience with tremendously moving and thought-provoking climactic moments. Set in Baltimore, the show painstakingly details and poignantly reveals the lives of its police and politicians and criminals and reporters, their highs and lows, their triumphs and failures, their everyday grind and their choices, big and small. There is dark and light in all of the characters. All of them are capable of making heroic and tragic choices and all of them do.

I simply can’t recommend the show highly enough. Let the details of each episode sink in, ease into the hyper-realistic pace of the storytelling, and watch a Season over the course of a week (or weekend!). Resist the initial impulse to reject the show’s tempo. Take a deep breath. You will not be disappointed.

I did not become a libertarian because of this show, though without that background I might have been inspired by the show to seek an intellectual frame of reference for making sense of the behavior of The Wire’s government officials.

While my reading of Enlightenment philosophers (Hume, Locke, Adam Smith, Rousseau, Condorcet), Austrian economists (Mises and Hayek), public choice theorists (Buchanan), Charles Darwin, Frederic Bastiat, H.L. Mencken (“Sage of Baltimore”), and Ayn Rand over the last twenty-five years certainly facilitated my acceptance of the merciless accuracy with which the Wire’s creators depict politicians and bureaucratic systems and their deleterious effects on society, I wouldn’t believe that anyone, regardless of their biases, could watch The Wire’s docudramas unfold with an open mind and sustain a positive view of our cities’ and states’ and federal governments’ behavior. I’m sure that I’m as susceptible to confirmation bias as anyone else, so perhaps I’m seeing what I’m inclined to see.  But somehow, because The Wire is among the least contrived shows I’ve every seen, more like dramatized truth-telling than a fictional account, I would go as far as to argue that it would be difficult for a person to make a convincing argument for continuing the war on drugs after watching any one of the seasons, or for government involvement in education after watching season four, or for government stewardship of any substantive charitable/humanitarian effort after season five.

The Wire highlights the impact of unintended consequences in public policy and even challenges me to defend the feasibility of a “minimal state.” My inner anarcho-capitalist is warning me that a libertarian state only exists in a theoretical vacuum and promises to say “I told you so” as it does when it observes how far our government has diverged from its founders’ original intentions. If the only way to avoid a class of politicians who would never be satisfied to operate within the constraints of a libertarian system is to promote anarchy, so be it. The Wire is a snapshot of the futility of big government and an affirmation of its conditional inevitability (ie, given an apathetic public and quiescent journalism, expect government to grow relatively unchecked).

Many truths shine through in the Wire. Those who work for the government are no better than the rest of us, but their worst appetites and least noble character traits are rewarded by the system within which they work. So, does it really make sense to have them be in charge of schools and social safety nets and policing? The best intentions of a particular politician matter less to the formation of policy than the overriding desire to achieve re-election or rise to higher office. These incentives drive a politician and his/her closest aides to take positions that promote the perception of progress while substantively undermining real progress.

The penultimate expression of that trend is a public living impoverished lives while extolling the virtues of “the nation” and politicians’ wealth and power expanding as they extoll the virtues of “the nation.”  But how long will that last? The ultimate expression of this trend is revolution.

Rush out and rent this series.

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