Anarcho-capitalism dissolving into feudalism?

Economics Economics Questions
1

This question was inspired by the threat on Honduras private cities. Perhaps this question has been asked before…

Imagine there is an anarcho-capitalist society. Why won’t it dissolve into a feudal society? A number of corporations buy off large chunks of land and become absolute masters of what goes on on the bought land. Or, perhaps, they start off with offering protection services – but then the contracts evolve into de facto (or de jure) land ownership.

Which is basically what happened in many societies that had become feudal. For instance, many Polish/Ukrainian peasants had colonized the Western bank of Dnieper river in what is today Ukraine. They suffered from attacks by Tatars and Turks and welcomed Polish armed aristocracy that offered them protection in return for taxes. Over a couple centuries that evolved into the Polish lords having absolute power over the peasants to the point that they were treated worse than domestic animals.

(It’s true that in many cases peasants were conquered by lords of a different society – which eventually happened to the Ukrainian peasants who became slaves of first Cossack, then Russian masters. But in many cases the feudal system formed de novo as I have described.)

So, someone like Nozick may say: at least under minarchism we have a system with self-imposed restrictions from within the society. But under anarcho-capitalism, economies of scale will lead to feudalism, where huge corporations might be absolute rulers over their land and anyone who lives on it, and existing legal system (funded by these corporations) will recognize overlordship of property owners over their tenants.

I am looking for an economic explanation of why this wouldn’t happen (or is unlikely to happen).

In general, when anarcho-capitalists say that “all roads will be privately owned” and “there won’t be public space”, it seems that they envision many patches of privately owned land, many owners competing with each other for quality of offered (road) service; plus, many different protection agencies offering their services within a single city, akin to today’s cell phone service providers.

But why won’t it become “company X owns New York City; company Y owns New Jersey”, each company provides all services (from protection to road) in a given chunk of territory, has absolute power over what goes on – and… basically we have many small absolutist states.

2

Good luck.

3

It might become something resembling feudalism. But the important thing to remember is that catallacty is more productive than coerced exchange. That means that given competing groups of people and equal starting points, the more-catallactic groups will amass more wealth than the coercive groups. So its hard for me to understand how a coercive institution is supposed to arise and sustain itself when it is competing with catallactic institutions. I will grant that its possible, because some people might not value freedom. But thats entering the realm of prediction.

4

@FlyingAxe

Roderick Long gave a speech Libertarian Anarchism: Responses to 10 Objections. A couple of his points should address your question - number 10 specifically is about Nozick. Anyway, this is worth reading even if it doesn’t answer your question.

5

Well, it’s all speculation really. There isn’t necessarily an a priori reason why the scenario you describe wouldn’t take place, but there isn’t an a prior**i reason why it would either. The first objection to it comes from increased competition, both between alternative means of law-enforcement and between all established means and the possibility of establishing new means elsewhere.

You could argue that somehow these corporations have monopolised the world, but that’s begging the question. How did that come to happen? I really don’t see such bodies being so dominant in a world where simply having access to free money is nearly as easy as it is for them today. And also I should note that just because roads etc. aren’t ‘public property’ (i.e. state property) doesn’t mean that they are not owned by the local communities rather than by specific road companies or corporations.

6

Y’know I would say it’s a worryingly realistic objection. Private power is absolute. The safeguard is supposed to be the decentralization brought about by price action and the precedent that one could own one’s own property. Libertarians ought to realize that privatization is extremely difficult to conscionably execute. With the power that gigantic corporations wield inside gigantic states, I do fear that anarcho-capitalism could be a ‘backdoor’ so to speak.

On this issue we should refer to Konkin’s ideas on the legitimacy of property: state land grants are not legitimate claims to land. When large plots of land become concentrated due to state action, they ought to be busted up into smaller plots. Those people in Honduras ought not to recognize the title of the owner of that city. In my opinion, state privatization is not a palatable AnCap scenario. Libertarians ought not to defer to private property titles out of hand simply out of an ideological resistance to the demonization of property.

7

It all really depends on the context: the character of the stateless society, how it came into being, the makeup of other societies if any.

8

Here’s a motto I would suggest Misesians/Libertarians/AnCaps REFRAIN from adhering to: “Statelessness no matter the cost.”

9

To add a small bit to what has already been said:

As I understand anarcho-capitalism and the decentralization of power, all people would be free to secede from any voluntary institution/arrangement. So property owners would be able to escape from a corporate-feudal system, even if that means that they can no longer buy the goods and services from said corporation. Thus the seceding property owners could work together (catallacty) to provide the goods and services they want.

As far as people that don’t own property, but maybe rent: I think a free people would see the value in owning property, even if just a small amount. But who knows.

10

How Could A Voluntary Society Function?

This deals with your question.

11

@Nielso - I don’t mean to be rude, but I don’t think people watch your videos when you just post them like that in the middle of a specific discussion.

@Phi - I think that after a period of time, people living under corporate-feudalism could eke out the savings to buy property on which to live, out from under the sovereignty of the corporate forms. The question, to me, is: how long a period of time, and how painful a one? Corporations today share the power with the state as families share dinner. If one handed over all the land of the country to corporations, it is conceivable that they would be handed to a very small few of them (TPTB). In which case they might be in an economic situation wherein they are capable of not putting up land for sale and making a new society much like that of Imperial Russia, though much richer.

12

@Jargon

When Nielsio posts his shorter videos (15min or less), I typically watch them - well, I’ve seen most of his videos now, so I don’t need to watch some of the ones he posts. I’ve seen some of his longer videos (~40min), but I don’t think he posts those very much.

Perhaps more people have watched them than you think. That particular video has almost 25k views.

13

@gotlucky - I don’t doubt that his videos are well-made and well-watched, nor is it my intention to diminish them.

14

Oh I know, I’m just saying I think that some people do watch his videos even when he just inserts them with little comment.

15

Market relations require a certain parity of status among the actors within the market. That is, they are held to the same, or roughly similar, de facto standards of practice for ownership, trade, various liberties such as speech and association, and enjoy the same legal protections and privileges. All of this is prior to the market itself. Market processes cannot establish the shared meanings and common understandings that make market interactions possible in the first place.

The problem that anarcho-capitalism has, and most other liberal theories have, is that it confuses an approximate biological equality for an equality of social-legal status. Human beings are not inherently socially equal. This equality must be provided for by some institutional arrangement that produces mutual recognition of the appropriate identities and practices.

Anarcho-capitalist theorists, as far as I know, have not proposed a theory of how these prior meaning-practices are established and instead have focused more on the analytic task of devising internally consistent rule systems. Unfortunately the premises of voluntaryism and non-initiation of aggression can be applied to just about any political theory. The voluntariness of an interaction and the aggressive or defensive character of violence are not embedded, objective facts of a particular act, but are theory laden interpretations of behavior that are dependent upon certain understandings of the status of the individuals involved and their legitimate holdings. A different understanding can result in a different interpretation and therefore what constitutes aggression and voluntariness is not constant but dynamic, contingent upon the given meaning-practice of a social group.

The best that anarcho-capitalist theory has establish as yet is some form of evolutionary competition, which a feudalistic social organization is most definitely a possibility.

16

Perhaps you’d like to offer an explanation for these bare assertions.

Would you say that human beings are inherently socially unequal? If so, why? What reasoning and/or evidence do you have to support that claim?

I think another way of putting this is that the definitions of “voluntary” and “aggressive” are arbitrary - as are all definitions, inherently. So yes, people are free to disagree with particular (arbitrary) definitions. However, that doesn’t mean the underlying concepts go away. A rose by any other name would smell as sweet.

17

What exactly do you find difficult to understand? Or do you just want me to restate what I said with more words?

No. I’d say humans are not inherently socially anything. Social relations are constituted in part by our and others’ understanding of ourselves and others. And therefore are not inherent but conventional.

No they do go away. The concept of a rose refers to a physical object that would exist whether human beings created a category by which to understand it or not. Voluntary and aggressive are concepts that we use to interpret behavior and would not exist whether we created them or not. They are purely our own invention. The concept in this case is the thing. Very different from a rose as I’m sure you can see.

Also, I am not talking about definitions. A definition does not give a social relation form or even a criterion for evaluation. Definition and meaning are different things. A definition is a set of words, while a meaning is understood. Reading a set of words and understanding something is very different. Understanding also requires a practice of some sort as well.

So I would disagree that the arbitrariness of definitions (which in itself I agree with) and meaning-practice are different things.

18

I would imagine agricultural areas would be prone to feudal type arrangements, but more urban environments wouldn’t be very susceptible. I would guess in urban areas you’d see more mafia types. Regardless, the individual members of those arrangements would be free to change their situation in life. Unlike a medieval peasant, the agricultural worker could go get a job elsewhere without asking permission. And if a small business did not care for the protection being provided by the agency they were paying, they’d be free to change agencies at will.

In other words, so what? If feudal arrangements are economically feasible and socially acceptable for their members, they’ll arise. If not, they’ll dissolve. Either way, there would be no coercion involved so these systems would not be like the ones you see in history books.

19

No, I don’t want you to do that, because that would just be repeating your bare assertions.

What I want you to do is this:

  1. Show reasoning and/or evidence that supports your assertion that market relations require a certain parity of status among the actors within the market.

  2. Show reasoning and/or evidence that supports your assertion that this certain parity of status is (necessarily) prior to the market itself.

  3. Show reasoning and/or evidence that supports your assertion that market processes cannot establish the shared meanings and common understandings (what do you think these are, by the way?) that make market interactions possible in the first place. This requires you to show reasoning and/or evidence that these shared meanings and common understandings (whatever you think they are) make market interactions possible in the first place.

The only part of this I disagree with is the apparent reification of social relations.

Would you say that “walking” is a concept that we use to interpret behavior and would not exist whether we created it or not, thus being purely our own invention?

I was treating “meaning” and “definition” as synonyms, as I assumed you were. Apparently you’re not. But for you to claim that definition and meaning are (necessarily) different things implies that you think there’s an objectively correct meaning for everything. In other words, it implies that you think there’s a correct way to understand a set of words outside of any particular social context. Can you prove that?

20

So, what you’re saying is that for market relations to work, certain social conditions must be in place, and those conditions won’t just fall from the sky. Fair enough.

But then you say that those conditions must be provided by an “institutional arrangement”. Here is the problem as I see it:

  1. Institutional arrangements themselves need a set of social conditions in order to work. Why do you assume that those conditions will fall from the sky? As we can see from comparative history, they don’t, despite rulers’ or founders’ (or certain intellectual classes’) best intentions. As we all know, USSR Constitution was in many cases identical to the US Constitution. And, the US Constitution of today is in many cases identical to the US Constitution of 1800. Yet, in terms of social arrangements, especially preservation of freedom, the three societies (USSR, US today, and US in 1800) are very different.

  2. I would say that those precise social conditions you’re talking about must already exist in a form of understanding between people of how they want to live. The institutional arrangements are merely a mechanism for solidifying and codifying them. And constitutional republic as it turns out is not a very solid way of doing that. Perhaps a system of independently existing libertarian legal authorities is a better system. Which brings me to my next point:

  3. In order for markets to function well, you need paper and ink. Does this mean that there should be a centralized monopoly of paper production? Make the same argument for language (a centralized Ministry of Language), etc.