Why Anarcho-Capitalism will Fail

No. Or, yes in a metaphorical sense. If the majority of the people are honest and respect individual rights then there’s no way that providers of justice could oppress them. You seem to think that individual rights can only exist if the state creates them. That is your wrong premise.

"As for “the notion of democracy” being the key to check arbitrary power, I confess I don’t get it. What’s more, if you look around you may notice that the minimal state was tried…and failed rather miserably. "

Democracy allows the people indirect control of the government. Of course, democracy is majoritarian and depends on the ideological perspective of the citizens. If we, however, as Libertarians, are able to convince the people that property rights is the only way to go, then there is no reason why a minarchist demorcracy wouldn’t last.

The minimal state has not failed ‘miserably’, we still enjoy a relatively large amount of freedoms (although nowhere close to ideal). In the instances where it has failed, it was due to unknowledgability of citizens, notdue to the system itself.

". If the majority of the people are honest and respect individual rights then there’s no way that providers of justice could oppress them. "

Why not? If the minority is better armed? This assumption is not grounded in any logic whatsoever.

" If the majority of the people are honest and respect individual rights"…that is a very large assumption. And what happens if they do not: if they change to a position that, for example, all red-heads deserve to be shot? Than the PDAs will shoot all the redheads? How is this a protection of property rights?

"You seem to think that individual rights can only exist if the state creates them. "

I think that the market can only exist if something creates it. The market cannot create itself. That is just plain silly.

Right. The market is created by the minimal state, and that is not silly.

Actually a market is simply a cumulative result of human interaction. It is not something that is deliberately designed or created by some entity. The proposition that states create markets is nonsensical. Markets arises in spite of states. Even when states try to curtail markets they arise anyways or move elsewhere. Human interaction is human interaction. It is absurd to argue that the human interaction of production and trade would not take place in the absence of a central authority, as if a central authority is the only reason and motivator for people engaging in economic activity. Nevermind natural incentives, right? Surely the state is the reason why people make stuff and sell stuff and buy stuff. Without it, everyone would just try to live as self-sufficient hermits, right?

Bleh. Surely you know better. Any minarchist worth their salt who has studied economics even to a minimal extent should know that markets are a natural result of human behavior.

I think it’s extremely naive to think they’ll profit from fighting and oppressing their clients, when the advantages that accrue to states from such behaviour are only realizable due to their ability to shift their costs to taxpayers and inculcate them from a young age. Competitive firms will have no problem in realizing worthwhile profits. In the long run, I fail to see how a firm has more to gain by becoming a tyrant than by providing its clients with security. By the way, collusion? I thought minarchists knew better than to cite this statist nonsense?

Why would it be ‘fairly easy to do’? What makes you assume this? We’re not talking about government here.

Monopoly on law and order has proven to be nothing short of a disaster. Contracts and property rights are only partially enforced now. When the US marches on to full blown socialism, this will become all the more evident. The ‘hostility’ is what one would expect on an Austrian forum, when you’re bringing up arguments that have already been substantially addressed by various Austrian (and non-Austrian) market anarchists. Minarchism plus an unlimited right-to-secession (a Misesean idea) is not much different to anarchism, anyway…

It is always in the long term best interest of everyone to want/demand justice. Everyone wants justice, because being allowed to freely live is what is just.

It is in everyone’s best interest to remain alive. Anyone who does not want to remain alive commits suicide; all other people wish to remain alive, so they seek justice against any threat to their well being.

The misunderstanding here is that PDAs will be able to oppress only their clients: they would be able to forcefully expropriate anybody’s property in a method catallactically similar to taxation. The government advantages are limited because, as much as the government has expanded nowadays, they still protect most contracts. They are also held in check by voters, who would not reelect representatives who would expropriate their property in an obvious way.

There will inevitably come a point where it will become more profitable for the PDAs to simply expropriate all the wealth from their customers. Why will they settle for small monthly fees for protection when they could take everything? Even if another PDA were to intervene to prevent this, what assurance is their that they will not maximize their profit, but instead provide services in the name of ‘justice’?

The gist of the Austrian argument against antitrust and the like is that collusion does occur and can be stable, but, as long as there are no boundaries to entry, it is not an economically significant matter. With PD, however, there are strict barriers to entry: the oppressing PDA would simply shoot those who attempted to enter the industry. Also, the monopolization and diversion from Justice which could concievably occur in an anarcho-capitalistic society would be extremely significant catallactically: it would destroy the market.

That’s very much like saying, “The universe can only exist if something creates it. The universe cannot create itself.” And it’s just as wrong. “The market” is neither more nor less than the option of interacting voluntarily. As soon as two humans exist, “the market” already exists: they can interact voluntarily. They might not. They might. They might do this, or they might do that instead. But there’s no need to “create a market.” The mere fact of existence or more than one sentient being IS “the market.”

–Len.

This is silly. To achieve this expropriation the firm must first actually get the other PDAs out of the way. This is not cheap. It must also deal with an armed, independent populace.

Who said anything about ‘small’ fees? Firms can differentiate and diversify their products or services in a multitude of ways. Anyway, even small fees may assure high profits. What is to assure that a minarchist monopoly over law and order will do ‘justice’ and not instead decide to expand and expropriate the population?

You’re forgetting that at this point the calculation problem comes into play… there are no ‘strict’ barriers to entry, though. Using force to keep other firms out costs time and money, which the colluding firms will swiftly run out of - the argument pretty much assumes all or the vast majority of firms collude, and ignores the possibility of defection from within (a typical way of how cartels dissolve.) At this stage it would be a government, if I were to grant you your argument. The fact that such an activity would destroy the market is all the more an argument against its likelihood based on pure self-interest. Frankly these arguments convince me about as much as arguments for public provision of healthcare. That is to say, not at all.

I didn’t read the others’ contributions, so do forgive me if you’ve actually found the like of my brief response. Which is as follows: I think an existential issue is being raised here. Rothbard in MES has in fact dealt with it, saying that libertarianism does not say that people always know what their best interest is. Rather, it says all men should at least be free to do what’s in their best interest.

In an Anarcho-Capitalist state, who’s laws will the PDAs be enforcing?

No, you are completely ignoring a libertarian culture in favor of some neoclassical economic or Hobbesian view of calculated self-interest.

And if they’re competing with each other to provide it, then they will keep each other in check (and not simply by resorting to war).

These are two good pieces to read:

Roderick Long, “Libertarian Anarchism: Responses to Ten Objections

Roderick Long, “Anarchism as Constitutionalism” - a series of blog posts

By the consumers and by each other.

It would be a stronger deterrent in a libertarian anarchic society than in a statist one.

It might helpt to be a little less hostile to the views you are criticizing. Tone down the rhetoric and the apodictic certainty. I mean, you’ve read what by Rothbard, just For A New Liberty? What about The Ethics of Liberty? Hoppe’s edited volume The Myth of National Defense? Edward Stringham’s Anarchy and the Law? There is a pretty large literature on anarcho-capitalism. I’ve gotten the impression you’ve only raed For A New Liberty.

Ah, but see… You’re not familiar with all of the powerful arguments to the effect that it is the very nature of the state itself that led to its growth into Leviathan and the concommitant erosion of property rights. It’s inevitable, built into the very anatomy of the state. As we see it, a minarchy is but a temporary stage in the state’s growth. It’s impossible to freeze it at that point.

Also, I notice that you make recourse to a libertarian culture being necessary to support your minarchic democracy. The same is true of anarcho-capitalism, only in anarcho-capitalism there is the absence of the structural incentives inherent in the state toward growth into Leviathan, structural incentives which tend to erode the libertarian cultural foundation keeping the state minimal, structural incentives that are inherent to a monopoly provider of justice and security (and anything else the people want).

The non-aggression principle is the only law in an anarcho-capitalist “state.” The concept of “enforcement” isn’t really meaningful; that’s why they’re called “defense” agencies rather than “enforcement” agencies. They have no power except to defend against attack. In addition, of course, they can provide any other services they want, so long as they themselves don’t initiate aggression against anyone.

–Len.

This is mistaken.

The non-aggression principle is not a law; it is a standard for evaluating the justness of laws and the legal system. The legal system and its laws in an anarcho-capitalist society will have to be far more complicated than simply: don’t agress. But they will be far less complicated than the mountain of legislative law that results in statist legal systems.

Who is limiting the power of defense agency to defense and preventing them from attack? You seem to be equating attack with aggression (initiated), but the word need not be so limited. If security providers are only passive, how will the legal rulings of courts be enforced? Are the security agency’s clients just on their own here? Let’s say that Bob steals Frank’s widescreen tv. A local court rules that Bob is guilty and has to return the tv to Frank or, if this is impossible for some reason, pay him its monetary equivalent, plus court costs, etc. How is this ruling to be enforced if Bob is reluctant or refuses? Well, either Frank will have to enforce it himself (sanctioned by the court), or the security agency he contracts with will have to enforce it (sanctioned by the court), or the court will have to enforce it, if it is the kind of court that offers enforcement services for its own rulings (I’d rather keep these services separated though). Alternatively, one thing that is being overlooked in these discussions is the possibility of other means of providing security: to name two, insurance-security firms (as opposed to pure PDAs), neighborhood security associations (clubs, or what have you).

Yes and no. Lots of specific standards and customs will emerge to codify what is and isn’t aggression, and what may and may not be done about it. That’s necessary because otherwise we’re forced to waste time and effort reasoning from first principles every time. For example, it’s convenient to have a specific prohibition of rape, and another specific prohibition of murder. But all the “laws” that one might cite in an anarcho-capitalist society are simply commentary on the one law: thou shalt not aggress.

It’s extremely helpful to keep that in mind, because it answers Patrico’s question. Ultimately, every “legal” dispute boils down to two parties accusing each other of aggression. If no aggression is alleged, then no legal dispute exists. Morally, no “legal process” is required, either: since everyone has the right of self-defense, the aggressed-against has the inalienable right to repel the aggressor, using lethal force if necessary. Nobody needs to go to court to secure that right, and the right certainly isn’t vested in any “higher legal authority.”

The entire purpose of a legal proceding is to convince interested bystanders that party A really is the aggressor, and party B really was acting in self defense or may claim damages. Party B already had those rights, and doesn’t need any legal proceding to secure them. What he does need is to avoid misunderstandings: otherwise, bystanders might mistakenly conclude that B is really aggressing against A, and might therefore defend A using lethal force against B. B prevents this by first convincing the bystanders that A was the aggressor. He then exercises his already-inherent right of self-defense without fear that confused bystanders will resist or kill him.

That’s all summed up by saying, “Non-aggression is the only law.” The victim already knows he’s in the right, and already has every right to defend himself against aggression. There’s no “whose laws?” about it. PDAs authority proceeds from that right. A “judicial” system evolves only because PDAs would rather negotiate than fight. The only purpose of “legal” proceedings is to convince the right people–namely, the aggressor’s PDA, friends, relatives and neighbors–that the aggressor is in the wrong, so they will refrain from defending or avenging him.

Exactly! I think that’s implicit in what I’m saying. If a PDA kills and robs me under color of “law,” they need to worry not only about rival PDAs, but also about outraged Kiwanis, my vengeful cousins, my litigious heirs and my greedy life-insurer. They don’t need to justify defending me, any more than I need to justify defending myself, but they DO need to convince those parties not to avenge me. They do that by proving my killer’s guilt to their satisfaction. In many societies, by the way, weregild (i.e., blood money) was accepted instead of proof of guilt. Bedouin routinely paid blood money to heirs of bandits slain in self-defense, because it was much cheaper than a feud. It serves the same utilitarian purpose as libertarian law, but violates the non-aggression principle. If you aggress against me, then defending myself incurs no obligation whatsoever to your heirs.

–Len.

No: court sanction is irrelevant. Frank already has the right to “steal back” his TV. No court needs to sanction it. The court is only a forum for proving to interested parties that the TV set was stolen, so they won’t interfere when Frank takes it back. If Frank bypasses that forum, he runs the risk that Bob will videotape him recovering his property, accuse Frank of theft, and then “recover” it from its righful owner. If Bob does that, and Frank tries to resist, Bob’s friends will believe Frank a thief and use deadly force against him in Bob’s defense.

The “legal system” is nothing but a forum for educating others so they won’t defend the aggressor against his victim.

–Len.