Yesterday I read
Anarchism and the Public Goods Issue: Law, Courts, and the Police by David Osterfeld
Anarchy in the U.K. - The English Experience With Private Protection by Roderick T. Long
The Costs of Public Income Redistribution and Private Charity by James Rolph Edwards
The first two were mindblowingly amazing, and I recommend a full read. The third has some nice arguments and statistcs, but has some major flaws.
Here are the drafts of my summaries:
Anarchism and the Public Goods Issue: Law, Courts, and the Police by David Osterfeld
Osterfeld begins by outlining the popular objections to the possibility of an orderly and secure market-anarchy society. He shows that many of them are erroneously based around the conviction that anarchy means lawlessness. He then digresses briefly to consider the concept of common law actually discussed in anarchist literature. He notes that legislation of law is in fact a very recent concept - even that of kings making laws. Hence, the idea that without legislated law we would have chaos is historically unfounded. Common law has developed out of the judicial system by having jurors discover how to best resolve conflicts. It is gradual and provides stability, yet flexible enough to allow for important changes to occur and for outdated law to be replaced. In cases where previous common law was not enough, theory came to the aid of practice and philosophical principles close to the common law came to the rescue. Osterfeld explains how this concept of the extension of common law can be applied to pollution. He then explains the process by which common law arises – the examination of individual cases brought before a judge. As such, common law necessarily developed in a libertarian manner – defining the boundaries of aggression.
He explains why law codes would tend toward standardization and how private law between individual parties would also arise to solve specific scenarios and why this is mutually beneficial for both parties involved. He then explains how arbitration and dispute settlement would occur both when the parties in conflict contract with the same court and when the parties contract with different courts and why criminal courts are inherently unstable in the long term. He takes the reader through a micro-view of the economic incentives behind handing down solid laws.
[Note: examine the interactions of private roads and police and see what incentives would be at play there and what the effect on stability of the system this would have.]
He then addresses three objections brought up.
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The argument that either a “minimal state” or a Mafia-like agency would emerge through economic competition.
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The argument that a Mafia-like agency would emerge through aggression.
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The argument that selling protection services on the market would generate insecurity.
Prerequisites: basic understanding of micro market principles and working definitions of private law, common law, property rights, and statelessness.
Anarchy in the U.K. - The English Experience With Private Protection by Roderick T. Long
Before 1066, The King in England had a minuscule role in setting domestic policy. He acted as a war leader, whose followers supplied financial contributions and military service voluntarily. Domestic issues were relegated to moots, local courts that passed judgment in accordance with customary law. The primary social unit for purposes of security was the bohr, an association, typically of twelve people, who stood surety for one another’s good behavior. Kinship aspects in forming of the bohr soon dwindled and they became purely contractual arrangements, with strong incentives for a bohr to police its members behavior. This possibility is not limited to small societies but scales remarkably well, as proven by the Law Merchant. More modern England also shows the possibility of private provision of security. Before the institution of a modern police force, England has what were known as Associations for the Prosecution of Felons – or thief takers’ associations. People in a particular neighborhood would pool their resources and provide protection as well as funds to track down criminals and prosecute them. Both systems operated in the form of mutual aid societies – voluntary organizations where members helped each other and held each other to high standards of reputation.
Prerequisites – A basic understanding of common law, contractual law, stateless society, and restitution.
The Costs of Public Income Redistribution and Private Charity by James Rolph Edwards
Government welfare programs absorb, on average, 66-70% of their budget in administrative costs. Private charities, on the other hand, absorb one third or less due to competitive market pressures (and Edwards presents reasons why this number might be even less due to imperfections in the statistical measurements). A very large fraction of actual government income redistributions are sideways, from less politically organized members of the middle class to more organized middle class citizens. $146 billion per year is even redistributed from lower to higher income persons through corporate subsidies. Edwards criticizes the Pigouvian utility maximization income distribution model [but fails to note the even theoretical possibility of comparing interpersonal utilities. See any Austrian text on subjective utility]. Edwards notes that redistributed government resources must necessarily be drawn from the market, resulting in crowding out, and that tax collection itself is a process that wastes resources, as much as 65 cents to every dollar collected due to compliance, litigation, and enforcement. This means that to deliver $1 of aid in welfare, $5 must be taken from the productive sector of the economy (productive as in non-transfer payment). Remember, too, that not only does taxation reduce the incentives to work of the group being taxed, but also the incentives of the group being subsidized – resulting in even further loss of real output. Edwards then counters the “not enough private charity” argument and presents empirical studies which claim that government welfare programs, despite increasing four times in real amount per person since the beginning of the Great Society programs, have not been able to eliminate poverty, as they had claimed they would. Do remember, however, that the current analysis is performed with average costs, which rise with the amount of output, which puts government programs at a disadvantage due to their larger output. Still, given the current analysis, it is very likely that government programs at any output of aid will be less efficient than private organizations.
[Note: check out the Niskanen 1994 study on why government agencies might have the inverse of the incentives of market participants]
[Note: “modern studies of vertical economic mobility” (Federal Reserve Bank of Dallas 1995) that show that random factors such as birth and circumstance are not major deciding factors of income]
[Note: check this claim - Marvin Olasky (1992), in his notable study of the history of private charity in the U.S., has argued that the private agencies dependent on voluntary donations worked much harder and were much more successful than government officials and social workers have ever been at preventing dependence and labor force withdrawal by aid recipients.]
[Note: Edwards at the end fails to return to the point that much government transfer occurs upwards, rather than downwards.]
Prerequisites – minimal. Understanding of marginal cost and average cost recommended, but not required.