Hoppe's insurance agencies as would-be states

[Autolykos]

@davery

The Private Production of Defense, 2009 LvMI paperback, p. 50 (chapter 9, Insuring against state aggression):

“Other things being equal, the risk of an attack – and hence the price of defense insurance – would be higher in location adjacent or in close proximity to state territories than in places far away from any state. To justify this higher price, insurers would have to demonstrate defensive readiness vis-a-vis any possible state aggression to their clients, in the form of intelligence services, the ownership of suitable weapons and materials, and military personnel and training.”

Thank you.

In all honesty, I don’t understand why Hoppe conflates insurance with defense here. Insurance is a financial concept - defense is not.

@davery

I would buy insurance to protect against threat of aggression, as i specialize in a trade other than defense. Aggression is possible from any party with “sufficient” (I know this is loose) armament. Insurers near states are such parties. They offer services within a territory. Parties in or near that territory must therefore be prepared as if they bordered state territories. They would prepare because their livelihood depends on it.

It’s loose to the point of being in pieces. So the conclusion is that aggression is possible from any party, period. Now what?

@davery

Much like the [substitute gov’t agency] keeps [substitute appropriate product] out of the market.

Can you explain to me just how you think that’s done?

@davery

CEO of insurer A, a human being with a preference for most wants satisfied with least expenditure of labor, calls CEO of insurer B, also a human with similar preferences, and says “Let’s turn this into a racket. You charge x/person. I will do the same. We’ll ask C to join, and if he refuses, we blow up his buildings and bases. We offer to hire his soldiers. If they refuse we shoot them.”

What made CEO A suddenly want to run a racket instead of a business?

Are the “soldiers” (I didn’t know they were members of a military organization) armed when they’re given the “offer they can’t refuse”?

How long would it take to blow up C’s buildings and “bases” (I didn’t know C was running a military organization)? What’s the probability for these efforts being detected beforehand, let alone halted?

In essence, you’re assuming near-Godlike power to CEO of insurer A. Top military officers themselves have stated countless times that logistics is a major lynchpin, if not the lynchpin, of wars and military operations in general.

@davery

Of course i don’t. But it stands to reason that in light of aggression, they’d either fight or retreat. If they fight against overwhelming odds (the majority cartel), they would likely lose.

My point is that it doesn’t stand to reason, because it’s an argument from ignorance. You phrased your claim in a deterministic sense, i.e. you made a claim about what would necessarily happen. If you’re backing away from that phrasing now, then you’re necessarily making a different (and much weaker) claim.