Thoughts on economics and liberty

The absurd dreams of libertarian anarchists

While socialism presents a real and ongoing threat to liberty, it is also important to challenge the fringe school of thought called libertarian anarchy or anarcho-capitalism. These people threaten liberty through a utopia in which we would not only organise our economic affairs privately, as in the classical liberal state, but even defence, police, and justice. This idea is untenable and will destroy liberty comprehensively, as this article will show. The febrile, adolescent dreams of libertarian anarchists must be nipped in the bud so we can get on with the serious challenge of battling socialism and statism in India.
 
The problem of foreign invasion
There are at least two problems for which the state is the necessary (but not sufficient) solution. The first is the problem of large-scale foreign invasion, wherein marauding armies come in across borders and raze down entire towns, causing catastrophic ruin. India has been raided hundreds of times, but even the communist takeover of Russia and China involved mass destruction of life and property. In response, people carried huge rocks to hilltops and built forts. This collective defence, that includes a large army, forms the foundational pillar of the state.
 
The second problem is of trust. Human nature is not always very pleasant. The private sector, left unregulated, is basically a rogues’ gallery steeped in fraud, bullying, deception, and violence. While governments are by no means trustworthy, the private sector’s credibility is much lower. Each of us has been cheated so many times by the private sector even in the regulated state: imagine what would happen without the state.
 
The classical liberal knows that the state is not a nice little Fairy but a potentially dangerous beast. Hence he builds checks and balances to ensure that power remains with the people. But of this he is clear: that it is more desirable to entrust our life and liberty to a parliament whose functions of lawmaking and governance we oversee, than to fraud-prone private businesses. It is from such considerations that the classical liberal social contract arises in which people voluntarily hand over some of their innate animal powers to the state, being assured in return of a level of security of life and property. The classical liberal state is an evolutionary stable Nash equilibrium of private strategies. This is evident from the fact that people swear allegiance to their national flag only as long as their life and property are secured by the state, else revolutions are precipitated. The state is a creature of public consent.
 
The libertarians can’t seem to understand this basic logic. They also can’t seem to understand that had anarchy been able to resolve the problems outlined above, then human society would have tended to evolve into anarchy, not into the modern, classical liberal state.
 
Taxation is not forced labour
Libertarian anarchists completely deny the validity of coercive taxation. Even some classical liberals claim that taxation is theft or forced labour. And Ayn Ran could only tolerate the idea of voluntarily payment of taxes. But these ideas are all misplaced.
 
Taxes are nothing but the dues for security and justice. Even libertarian anarchy would need to pay for these services, there being no free lunch. The question then is: Which is the most efficient way to get such services? The response must display a keen understanding of the mechanism of collecting fees for such universal services (‘public goods’).
 
And the first thing we note is that voluntarism can’t work. Imagine that India disappears overnight and is replaced by libertarian anarchy, with thousands of private businesses competing to provide us defence services against the nuclear-armed Chinese army. Apart from the chaos that this would entail, barely any funds would be collected on a voluntary basis. Everyone would expect others to pay. The next thing we know: those living in this anarchy would have come under control of Chinese communists, ending all liberty that they might have dreamt of.
 
Compulsory taxation that is tempered by democratically agreed principles is the only viable method of providing sound defence, police and justice. Everyone gets this point, but not libertarians! They need to snap out of their foolish day-dreams.
 
The inadequacy of private security and justice
The classical liberal is happy for police and justice to be provided by the private sector to the extent that is feasible. Indeed, private contracts that do not harm others and are viable (in terms of transaction costs and free rider issues) form a part and parcel of the classical liberal state.
 
In any event, the state can only provide the more basic policing and justice services. Just because we have a police system doesn’t mean we should keep our gold jewellery lying about on the roadside. The rich must necessarily complement the state’s security services with private security arrangements where appropriate. That does not give the rich man any right to shoot down a ‘thief’, however; since even the alleged thief needs the protection of natural justice.
 
Anarcho-capitalists suggest that all laws should be privately determined and apply only to those who have paid for them. Also, “[e]veryone may choose which of the competing courts he will look to for protection; and he may alter his choice at will.”[1] This means that we could very well be shot dead by a private ‘justice agency’ to which a rich man has paid a lot of money. There is not much to distinguish private justice agencies from the Bihar mafia. No person in his right mind will ever entrust his life and liberty entirely only to a private police or justice system.
 
The nightmare of contractualism
Libertarians want us to negotiate all our defence, police and justice needs individually. In this context we note that laws of modern nations run into the thousands of pages, with clear definitions, precise formulations of accountabilities and punishments. The idea of individually replicating this effort through private suppliers is beyond absurd!
 
It is undoubtedly cheaper to send our representatives to parliament to make our laws and organise a police and justice system. This takes advantage of specialization, and allows us to supervise these systems. The classical liberal is perfectly happy to increase contestability even in matters of security and justice. For example, in Breaking Free of Nehru I suggest that the Indian government should register a range of marriage contracts that comply with minimum standards established by parliament. But note that even this needs minimum standards to be enacted and enforced by the state. The classical liberal state sets the foundation of the rule of law. That underpins modern civilisation.
 
The libertarians clearly betray not even the remotest understanding of human nature, nor understand costs and benefits. Theirs is mere idle, delusional day dreaming. The people, fortunately, are far more sensible. No peoples have ever demanded anarchy nor is there any mechanism (known even to the libertarian anarchists!) to convert the modern state into libertarian anarchy. The sooner the libertarian anarchists get real, the better for everyone.
 
Freedom Team of India
Let me assert that India can’t become a classical liberal state without your active participation. FTI (http://freedomteam.in/) is looking for leaders to lead a movement for necessary political reforms in India. Please join FTI or otherwise support it! There is no magic involved in getting a good government, only a lot of hard work and perseverance.

[This article of mine was published in Freedom First, March 2011]


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33 thoughts on “The absurd dreams of libertarian anarchists
  1. raj

    Excellent post. I have always wondered how libertarian anarchists would be able to defend themselves from invaders through private means. It is not possible to defend using private means against powers such as China.
    On the issue of tax, I think it must be collected only for ensuring security and providing justice to us. 
    No tax  such as Income tax, tax on gains, sales tax……
    By collecting tax only for security and a system of justice, the state would be small and not be a threat to the people. Taxes are  necessary for a society to function. And this would work only if we don't have an evil bank printing money for the govt. 

     
  2. raj

    Excellent post. I have always wondered how libertarian anarchists would be able to defend themselves from invaders through private means. It is not possible to defend using private means against powers such as China.
    On the issue of tax, I think it must be collected only for ensuring security and providing justice to us. 
    No tax  such as Income tax, tax on gains, sales tax……
    By collecting tax only for security and a system of justice, the state would be small and not be a threat to the people. Taxes are  necessary for a society to function. And this would work only if we don't have an evil bank printing money for the govt. 

     
  3. Sanjeev Sabhlok

    Dear Raj

    Re: ” I think it must be collected only for ensuring security and providing justice to us. No tax such as Income tax, tax on gains, sales tax…”

    What kind of a tax are you suggesting if not an income tax? And what is the theoretical basis of that suggestion?

    Regards
    Sanjeev

     
  4. Sanjeev Sabhlok

    Dear Raj

    Re: ” I think it must be collected only for ensuring security and providing justice to us. No tax such as Income tax, tax on gains, sales tax…”

    What kind of a tax are you suggesting if not an income tax? And what is the theoretical basis of that suggestion?

    Regards
    Sanjeev

     
  5. raj

    we pay tax for a specific service from the govt. Income tax has no specific purpose. Why should one pay tax on their income? The govt does not necessarily provide any service there.
    Income tax originated few hundred years back primarily in times of war. Instead a  flat 5 % tax only for Defense should be mandatory. The remaining other services that the govt provides can be easily done by private sector- roads, sewer lines, garbage disposal etc
     

     
  6. raj

    we pay tax for a specific service from the govt. Income tax has no specific purpose. Why should one pay tax on their income? The govt does not necessarily provide any service there.
    Income tax originated few hundred years back primarily in times of war. Instead a  flat 5 % tax only for Defense should be mandatory. The remaining other services that the govt provides can be easily done by private sector- roads, sewer lines, garbage disposal etc
     

     
  7. Sanjeev Sabhlok

    Sorry Raj

    Not clear what you mean by “Why should one pay tax on their income?”

    Then what should determine what someone pays tax on? Land holding/ poll tax (fixed amount per person?)/ what?

    And why “flat tax”? It is a flat tax on what? Income/land/per person?

    S

     
  8. Sanjeev Sabhlok

    Sorry Raj

    Not clear what you mean by “Why should one pay tax on their income?”

    Then what should determine what someone pays tax on? Land holding/ poll tax (fixed amount per person?)/ what?

    And why “flat tax”? It is a flat tax on what? Income/land/per person?

    S

     
  9. Cal

    All of your substantive concerns have been thoroughly addressed in the scholarly literature from anarcho-capitalist economists (David Friedman, Rothbard, Leeson, Stringham, Benson, Higgs, Hummel, etc.). You’re wrong. Look them up and cite their arguments if you want to engage their views.

    The rest of what you wrote can be categorized as strawmanning, question-begging, or simple non sequitur. For instance:

    “Human nature is not always very pleasant. The private sector, left unregulated, is basically a rogues’ gallery steeped in fraud, bullying, deception, and violence.”

    You attribute some vague negative outcomes in “the private sector” to “human nature.” Okay… so is the State superhuman? No, obviously not. The State is made up entirely of the exact same humans in the private sector. Your criticism there is rather poorly thought-out.

     
  10. Sanjeev Sabhlok

    No doubt, Cal. There are good arguments, I'm sure, to refute what I've said. This is not just a matter of argument, it is a matter of experience.

    But after seeing humans of all sorts I do not trust ANYONE (including those in government – which goes without saying). In order to ensure a modestly tolerable peaceful life I am convinced from all kinds of study and experience that models of democratic government with ACTIVE citizen participation, are the only 'tolerable' solution to the problem of evil, and the problem of human nature. 

    The people of the world are not stupid. The libertarians imagine they are. The people know instinctively the value of having a government. That they are better off with democratic free society is slowly dawning on most societies. That they should get rid of government will NEVER strike them as sensible. That much I can assure you. So please carry on your studies, but don't imagine that it will lead to any change in human society for the next few million years.

     
  11. SHIVANK MEHRA .

    Given the impossibility of economic calculation under any State monopoly funded by extortion (socialism), national defense would be the weakest argument in favor of the State. (See Mises’ critique of socialism).

    Once again, if you think a socialized system of law and order guarantees the efficient production of law and order, then you are appealing to emotion, not reason. Sound economic theory does not allow rational economic calculation under socialism. So you’re looking for a guaranteed production of any good (be it infrastructure, security or arbitration), the State would be the last place to look up to. You’re criticizing free market for its uncertainty (esp. in defense and law) yet you haven’t provided any proof that law and order and defense would be efficient under socialism. In fact, given that the free market has a rational methodology for resource allocation and socialism has none, it is a no-brainer to tell under which system the uncertainty is more.

    //Compulsory taxation that is tempered by democratically agreed principles is the only viable method of providing sound defence, police and justice.// Unsubstantiated claim; in fact, one that is in gross violation to the laws of economics.

     
  12. Abeed Khader

    JUST A SUGGESTION! I HAVE NO EXPERIENCE!

    Why can’t there be a judiciary system like, the courts would be run privately, but there would be a central board watching over them and it would also state the laws, the other and only power of the central judiciary body would be to act when any of the private court does some injustice or fraud, people won’t attend to courts that don’t have a good reputation for solid, just and final decisions. The amount of cases forwarded to the central board may be high initially, but the market would gradually bring it do. The purpose of privatizing courts are to run the cases faster and more efficiently, since they would be in competition (Not to create “best laws” out of the market by competition). There should be a branch of the central judiciary board in each state (No need for one in each district). People should be discouraged to falsly appeal to the CJB because the laws were made by CJB and hence they can appeal only in case of some misdeed by the private court. How would the court profit? By creating contracts with the private police agencies.

    Police work should also be privatized as suggested by An-Caps, but strictly no right to kill! The private sector would develop new techs specializing in defence and protection for both their customers and employees.

    The Central govt would own the National defence, which would be split to every state, cause of the restrictions on the private police agencies to own military grade weapons, there would be no risk for a tyranny, the military would be superior. The central judiciary board can have a small specialized wing of the military to execute decisions for them.

    Emm.. higher employement oppertunities. lesser taxes cause of lesser govt institutions or programs.

     
  13. Raj Chattopadhyay

    Without Free Will, the who point of life is missed. Stop crushing Free Will!!

     
  14. Raj Chattopadhyay

    Hi Sanjeev. I just read your article clearly. Sorry for that knee-jerk comment there. I agree with you though. Sanjeev, I’m an international student studying in Adelaide, Australia, at the moment. I would love to be a part of your team and do have a vision for a life in politics. Just turned 20 and am stuck in a rut going a degree forced upon me by my parents. Seek to leave the very moment I’m financial foot.

    This may be a bit too long but please bear with me:

    I have become an Individualist. Because Collectivism doesn’t make sense. Groups do not have dreams, souls or bodies. Individuals have them. And, the whole goal of life is to gain contentment and for this, we need to pursue our dreams, the deepest desires of our souls. And, for dreams, we need — Freedom! Freedom, the ONLY thing that can help attain the highest purpose of life i.e. contentment.

    A righteous, ideal world is one in which each individual realises they need to pursue their dreams and whole-heartedly does it.

    And, regardless of all what my parents want. I have needs. Those needs are my dreams – the gateway to contentment. And, I realize I cannot be really happy or content living in Australia or as a citizen of Australia where I’m looked upon as a foreigner despite being a citizen of the country. I’m an Indian citizen; stick long enough to my parent’s will and that will be gone.

    I realize I need to live in a place I want to. And, I have an instinctive feeling which tells India is the “right” place for me. Ideally, the hills of Himachal for it’s weather.

    Nevertheless, more importantly, I have come to understand that we are either the rulers or the ruled. And, if I choose to be ruled, I want laws which are fair.

    What are fair laws? Well, every being has a natural right to do whatever they like so long they do not harm others physically or infringe their privacy. Literally anything! And, such freedom is the prerequisite to live a happy, content life as it helps fuel their dreams. So, who takes away their freedom? Society.

    The irony of the fact is that much of the world, specifically the non-western world, doesn’t even realize that they have a natural right to freedom and that they need it to achieve everything they were ever looking for in life!

    Fair laws are those which protect these natural, God-given rights of the people.

    This is exactly the role of the government: To help ensure fairness in society, nothing more, nothing less. It has no business in telling people what they should do!

    And, for all I know, I can either live under these stupid laws now or choose to become the one who make fair laws and establishes the Rule of the Free.

    Thus, I want to do all that I can to do as much as I can in my life time to establish the rule of the Free, the rule of the Brave, the law of righteousness.

    And, I can’t do this by myself. Thus, I thought I’d contact you and tell you about my anguish.

    I may not be able to do a lot in life or may not get anywhere with all this in my lifetime. But, for the least, I tried. I did what I loved and followed my dreams. I lived a Free Man! And, that shall be enough for me. Let’s see where it all ends.

    Live Free or Die!

    Kind Regards,

    Raj

    P.S: Would just like to add that I truly am a nutcase as my family calls me for my “extremist” views. I support legalistaion of prostitution. Legalisation of marijuana until safe health limits. The right to absolute Free Speech! And, on a more touchy note, a referendum for the Kashmir Valley to choose where they belong as all people have a natural right to choose where they belong and whom they wanna be a part of.

    Good day Sanjeev, and lastly, you’re a very, very, very Brave man! You inspire me. Good luck! Bye!

     
  15. Sanjeev Sabhlok

    Agree with you on most things. A slight issue re: “a referendum for the Kashmir Valley to choose where they belong as all people have a natural right to choose where they belong and whom they wanna be a part of.”

    I started off with that position, initially. But soon realised that this position is not tenable. Won’t go into details, no time to do so. But I suggest you consider reading chapter 4 of DOF: http://sanjeev.sabhlokcity.com/book2/discovery.pdf

     
  16. Raj Chattopadhyay

    Shall I wait for a brief explanation? Coz the chapter is really long. Or you could perhaps point out a certain section or page number? I read the last bit: Sovereignty of nations, guessing that would have the relevant bit but I guess it didn’t. Will wait for your reply!

     
  17. Sanjeev Sabhlok

    Please pay attention to the concept of territory.

    Property within a territory is defended by the state. Territory is defended by force.

    Accordingly, once India occupied Kashmir upon its king declaring his intention to join India, there is no further question of any referendum.

    On the other hand, India could voluntarily, as a nation, decide to allow any citizen anywhere in India the right to secede through a constitutional amendment. That would be a civilised thing to do. First, such a right to secession has to be made a constitutional right, and then such a referendum is possible.

     
  18. Raj Chattopadhyay

    I agree. I clearly understand the legal circle here. Legally, the territory is ours. So, we continue to defend it. And, then a referendum by means of a provision in the constitution that provides for such. Kay.

    Lastly Sanjeev, I hope I’m not pestering you here! But, I really want to be a part of your team and be a part of Indian politics. An, to also help with attracting like-minded people to join us as quickly as possible to change the nation and culture. But, As mentioned before, I’m in the middle of university. I do not want to do it. But, if I don’t, my parents would throw me out and I’d probably die hungry. I plan to start work soon, but that would mean that I wouldn’t be completing my Bachelors.

    I plan to earn an income by trading on the Foreign exchange markets. I’ve tried it in a model market with paper money and I think it gave me the confidence that I could possibly do well in the real one too!

    The reason I want to get on my foot asap is because there is an emotional expectation my parents will have that I would do what they want i.e. Settle in Oz with a nice, stable accounting job and work up the company ladder to be some manager or something. And, this would likely be ratified, if I complete my university.

    The rationale is I want to build my own life. IF I’m gonna complete this degree and then head on with politics. They would feel betrayed and horribly broken really. I do understand that they shouldn’t have had such expectations and a “I give you education. You live your life the way I want” kind of mindset, but I can avoid such a situation by simply earning a degree on my own foot.

    The issue is, I guess the SBP has mandated a Bachelors as the minimum requirements? I have a good whip over English and am literate in Hindi and can speak it alright. I’m pretty smart! You can trust me on that! I’m currently doing a Bachelor of Commerce(Accounting)(Corporate Finance) and it gives me a fine hold of the economy and markets too.

    Would a Bachelors be absolutely compulsory? Because if it is, I may have to earn it by my own income and by the time I finish, it may be another 4-5 years. But, without it, I can possibly be a part of the team within an year or two.

    Thanks Again!

    Regards,
    Raj

     
  19. Raj Chattopadhyay

    On second thoughts, I think, a referendum can also be applied either way? Like, let’s consider PoK. India and Pakistan can permit the people of PoK the chance to choose where they belong. The underlying principle remains the same: People choose how to live their lives. By extension, as well as which group of people or institution/nation they want to be a part of.

    The reason I think the King’s accession is better if ignored is because, well, in those times, the king would rule as per his own wishes possibly with disregard for the will of his people.

    Given this, history would show us that the Raja of Kashmir kinda did the same thing. The Kashmiris then wanted to be a part of Pakistan, but he acceded to India. I think caling it “Legal” is like hiding behind a veil. Coz, it’s the people of the land who make the laws and laws, as we know, can be fair and unfair.

    It was “illegal” in British India to publish material calling for sovereignty and self-rule. It doesn’t mean it was wrong!

    The question, I believe, we must ask is :

    Is it the right thing to do?

    When seen holistically, I think it was wrong! The people of a land have a God-given, natural right to choose where they belong regardless of any man-made laws which allegedly take away this right of theirs.

    Some things that happneded coincidentally: MAhatma Gandhi allowed Pakistan to secede, I think it was so extremely gret and noble of a man who befitted the name “Mahatama”; simple because he knew and so did everybody and the majority of the people of then Pakistan would choose to opt out even when a referendum was held. So why waste money on a referendum if we’re fairly certain of the result already? Thus, Gandhi let them leave. It was noble of him!

    Coincidentally, the Hyderabad State was forcibly annexed intot the Union. It was the right thing to do, because although the Muslim ruler wanted to remain independence before which he wanted to join Pakistan. The PEOPLE of the place wanted to be a part of India.

    Logical extrapolation poins to it! Thus, we annex Crimea because the will of the people was untilmately what won! This was also the case for a HIndu-majority, Muslim-ruled kingom in Gujarat!

    Unfortuantely, what the people of Kashmir wanted at the time, they didn’t get and their rights aren’t respected today.

    However, force is only the second best thing. For instance, Russia invading Crimea might be what the RUssian-majortiy Crimea actually wanted but the civil way to resolve ot is with a plebiscite!

    Thus, although we annexed Hyderabad and Goa and this is what the large majority of the people in those areas at the time may want; the plebiscite would be the best thing to do!

    This is exactly what Nehru did for Kashmir with the UN resolution. Unfortuantely, nobody takes this seriously.

    Another “benefit” that may co-incidentally arise is – We get rid of “trouble”. The terrorists and other violence and threats that come with subjugating people can be avoided. The Kashmiri militants and the Khalistani violence all arsing out of forcing and occupying with force. This specific problem can end! And, we are sure that people of India are TRULY Indian and not just Indian by passport and people who neither feel or work towards the prosperity of India but may possibly spend all their lives trying to get their own thing. This wastes their whole life, funnily, we even waste our time trying to occupy people and lose our men doing this madness.

    That’s all. The will of the people must triumph! That was long, hope it may have helped with advancing how we think of people and their rights over where they live. Bye for now! ;)

     
  20. Sanjeev Sabhlok

    A bachelors is a minimum requirement for FTI, not for SBP.

    You can join SBP as life member and do only that much which is consistent with your career/ life goals.

    We are very clear at all times: At **no** time should any liberal “sacrifice” or undermine his/her life goals/ duties. Please not only get your degrees but earn a lot.

    Family and personal goals first. Nation is always a secondary, shared responsibility. Pl. see introduction to BFN in which I explain this concept. Likewise I will never “sacrifice” for the sake of the abstract concept called India. India can be a great country, but not at my expense.

     
  21. Sanjeev Sabhlok

    As I said, on matters of territory, the law of the jungle applies. The referendum concept floated by Nehru is well and truly dead.

    Even if the king had not acceded to India but India had forcibly occupied the whole of Kashmir, the situation would not change.

    The point I’m making is that in matters of territory, groups always use violence and force. There’s never been any example of territory acquired peacefully. Having said that, I like the idea of becoming more civilised and allowing secession on the Indian constitution, but under very closely guarded and controlled circumstances.

     
  22. Raj Chattopadhyay

    Thanks for the comments. One last question. I was rather confused here, but isn’t FTI the organisation which helps prepare leaders for SBP? I would love to contribute to FTI and I have lots of stuff and way in which I could help! But, the educational requirements might turn things sour as I may not finish this degree as I want to use as little support from my parents as possible, because ultimately, the more I take, the more they would expect in return. It’s just the right thing to be independent under these circumstances! But, I assure you that I clearly understand the concept and the NEED for liberty and tons of other social and economic concepts. I’m done two years with the degree and have a fair idea of the financial world. Fair enough to help with FTI and SBP. Can it really not permit me to join? I love the party and fairly agree staunchly with all the core values and understand them inside out! Thanks as always!

     
  23. Sanjeev Sabhlok

    FTI was started – and continues – as a group of leaders committed in principle to contesting elections under the banner of liberty. These are supposed to be future candidates for elections.

    SBP membership doesn’t require any commitment to contest elections. However, SBP has a minimum age requirement, of 18. If you meet that (which you probably do), then you can apply for life membership at http://swarnabharat.in/register for Rs.100 (payable through a payment gateway).

    You could, in your spare time, think of ways of reaching out the message of liberty to the youth.

     
  24. assman

    I too disagree with anarcho-capitalism. However I think it may be the solution to India’s problems!!

    Consider the city of Gurgaon. Its basically anarcho-capitalism and its hugely successful. But what’s interesting about it is the demands its generating. The thing about anarcho-capitalism is that its clear it leads to economic growth and the growth potential is huge. But its also clear that once a middle class rises up from a condition of anarcho-capitalism its start demanding a strong effective government to be able to deal with public good problems.

    Until you get the middle class you won’t have this type of demand but to get this type of demand you need to completely get rid of the state. In other words you get a strong state by having no state.

    Its pretty clear this happens in real life. Consider for instance fire fighting. Modern professional fire fighting evolved from insurance where they used to pay fire fighting companies to put out fires as long as the house had a special symbol provided by the insurance company indicating they were covered. The problem was the fire tended to expand beyond uncovered houses to covered houses. This is why insurance companies lobbied for professional fire fighters paid by municipal taxes.

     
  25. Sanjeev Sabhlok

    “Consider the city of Gurgaon. Its basically anarcho-capitalism and its hugely successful.” – the biggest lie in the world.

     
  26. Suteerth

    Sir,
    As far as I could make out you have the following issues with the concept of anarchocapitalism. I have added a few more objections to be fair :-
    1. We would be very susceptible to foreign invasion under anarchocapitalism because small, “disorganised”, competing defense agencies companies would give way to a large consolidated army like China’s.
    On this I suggest that you read a pamplet by Mr. Robert P. Murphy titled “chaos theory” and the book Power and Market by Murray Rothbard. The contention of both of these books is that centrally planned allotment of resources fails. In a completely socialist economy without any market prices the case is clear enough. In case of a centrally planned SECTOR of the economy like government post or government railways, you have DISTORTION of market prices for the relevant resources like manpower, steel rails, vans, coaches, engines etc. instead of complete abolition of them. Now what about the army ? Well how do the people at the helm of affairs know what is the optimal distribution of soldiers, tanks, missile trucks etc. There are no bounties on their targets and distorted market prices for these resources. So if there is a free market in these resources as well with bounties on their targets and undistorted market prices for tanks, trucks, guns, individual soldiers, snipers etc. then we would have a more efficient use of these resources. Any claim by you that the military is an exception to this theory needs justification by YOU and not me.

    2. Warlords/the mafia would take over. On this I cite Robert P Murphy’s article “Wouldn’t warlords take over?”. If 90 percent of the people in this country decide to loot, rape and murder the remaining 10 percent then all the police force, army, CRPF and what-not would be insufficient to stop them. That some semblence of law and order prevails in india is because the majority of the people are willing to use force or consent to the use of force against looters, rapists and murderers to keep them under control. Nevertheless I cannot elaborate the other arguments due to lack of space. They are all found in the article cited.
    3. The free rider problem. On this look up “the fallacy of public goods” at the website https://www.mises.org.
    4. Who would help us if a private defence agency went rogue/became a puppet in the hands of the rich to kill the poor. On this I cite again Robert P. Murphy’s pamphlet “chaos theory” and Murray Rothbard’s “for a new liberty- the libertarian manifesto”. With judges giving judgements favouring the rich and powerful under the CURRENT indian judicial system, it is besides the point to say this human temptation would not exist in a libertarian society. The point is there would be other competitors to go to in case that happened while under the current system there is a single chain of courts whose judgements cannot even be criticised under the doctrine of contempt of court.
    5. There would be an infinite regress of appeals and more appeals until only the rich have money left to pay for the court fees. On this see the system of appeals outlined in Murray Rothbard’s “Libertarian manifesto”.
    6. Only the rich would afford to pay. There is a system of legal aid societies currently operative in the statist system of USA. There is no reason why similiar systems would not rise up in an anarchocapitalist society. Also lawyers and court fees would be much lower due to lack of professional licensing of lawyers and judges.
    I hope this answers some of the issues you have with anarchocapitalism.

     
  27. Sanjeev Sabhlok

    Suteerth – I don’t have time to engage on these debates at the moment. I believe there is massive government failure so we need to cut down government, but the world is simply not ready to abandon governments from core functions of defence, police and justice. And you can’t supply them on your own. So you’re stuck.

    Your efforts will be more productive if you focus on making defence, police and justice more efficient, transparent etc. so people get value for the money they pay.

    And yes, that will require deeper study of economic incentives and institutions. Shallow analysis which is typical of the proponents of anarcho-capitalism simply doesn’t cut the ice in the real world, in fact, makes the proponents irrelevant.

    The devil is in the detail. Start by reading BFN.

     
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