Practical anarcho-capitalism

What would anarcho-capitalism look like, if we had it? How would it work? How would we solve all the problems that government now solves for us? It is easy to see how the need met by such things as government postal delivery might be met. It is not so easy to see how defense would be handled, or how we would be protected against tyranny.

Many people love the original Constitutional United States government system because they believe it to be the best system mankind has discovered for protecting liberty. Often you'll see such good patriots attempting to educate today's public about the fact that the U.S. system is not a democracy; it is instead the superior system of a Republic. Of course, in practice our system has been attempting to devolve from republic to democracy, and from there to socialism (did you ever know a Communist nation that didn't like to refer to itself as "The People's Democratic Socialist Republic of [Region]?"). And personally I think the similarities between republic and democracy are greater than their differences. But I do agree that Republican government was a great protection for liberty, and a great check against tyranny.

History has produced a long list of such checks against tyranny:

• the rule of law


• Constitutional government


• law applying to the ruler as well as the ruled


• democracy


• republicanism (not the political party, the form of government)


• separation of powers


• bills of rights


• checks and balances

In the end, though, none of these is sufficient to guarantee liberty is never violated. And in fact some of them don't work nearly as well as advertised. And unfortunately many of them get equated with "liberty." Right now we say we want to spread "democracy," and we act as if that means spreading "liberty." The very definition of democracy is actually incompatible with liberty.

Anarcho-capitalism surpasses them all. And what's more, anarcho-capitalism actually is liberty.

I think a Republic was a great advance and a great protection for liberty, but in the end I think it always devolves again into tyranny. I do not believe one government can check itself, even if you have separation of powers. I believe governments can only be checked by the people, or by other governments.

Being checked by the people has always been a part of government's existence, even under tyranny, even since the first raiders rode into a peaceful town and proclaimed themselves kings. The government takes a lot from its people, in the form of liberty and resources. It loudly gives a large portion back in the form of services. They give enough back to keep the people from revolting, and this keeps their power and income sources secure. It's a little more civilized under a Republic, thankfully.

This necessity that government be checked by the people is always the reason for the need for the rights granted by the US second amendment to be secure and absolute. I know a lot of people think the 2nd amendment is about hunting (I used to), or personal defense against local criminals (I used to think that, too), but the reason the founders talked about was the need to protect from the main criminals of history: government.

The second way of checking government is why a Republic is not the greatest hope for human government, and anarcho-capitalism is. Under such a system, every person would have the right to secede from their government, as well as the right to form new governments within the same territory. Noone would have the right to compel anyone to be a citizen of their government; government would be by true contract. If a government became tyrannical to its citizens, they could form a new one (or several) to protect themselves from its depradations. If a government acted tyrannical to those who were not its citizens, they could protect themselves by forming their own government. And this is pretty much exactly what the Declaration of Independence says, that government is an institution with the special purpose of securing rights, and that all people have the right to form such an institution as seems best to them (though I doubt Jefferson envisioned multiple such institutions in the same geographic region).

Noone has the right to do that which is wrong, not even governing officials, and in all history the biggest threat to man's rights has been the government; therefore the most pressing reason to form a government is to protect its citizens from another government. Under our present system government does much which is wrong. As it exists, taxation is simply legalized theft (indeed, the government is simply a group that has a monopoly on breaking laws such as this with impunity), and much of the rest of what governments do is simply legalized slavery. Under a system of anarcho-capitalism this could not be the case. A government's only citizens would be people who had explicitly agreed to its terms, which would include whatever fees the previous citizens or founders had deemed necessary. Governments could actually compete for citizens by trying to offer the best protection for the best price.

People who wanted to keep the existing institution, the United States federal government, could do so. They could support it with their taxes, pledge their allegiance to it and salute its flag, think of it as the greatest country on earth, and everything they want to do now. They just couldn't compel other people to do so, and they'd have to allow their children to make the decision for themselves when they grew up, and they certainly couldn't force everyone who lived in their land after they died to be bound to the same institution for hundreds of years or forever. They'd have to grant everyone else the right to be free.

I'm going to say something you might not have realized anarcho-capitalists believed: we do need government. At least, we need to have our rights protected, and we need to create institutions to do that for the common good. What we don't need is to take away the rights of other people in order to protect that for ourselves. Government as it exists today rests on the premise that you and I cannot protect ourselves unless we force other people to furnish the means and manpower to do it, and to surrender complete allegiance to our system and any decisions it makes as well. This is not true! It might provide some form of protection, but it is inferior to what could be developed in a world of true freedom, it weakens the foundations of society by making us interact together in forced ways rather than those we would naturally choose, and it damages our economy because of the damage to our freedom, resulting in decreased wealth and therefore decreased capacity for the very defense we were trying to achieve, as well as decreased capacity to enjoy the fruit of our labors.

One world government?

If the state is such a good thing, why don't we just have one of them? For the entire world.

When I was younger, I accepted all the good things people told me states were responsible for. Civilization would be impossible without them. States were the only way people could be protected. States provided needed services that couldn't be obtained in any other way, such as roads, schools, and certification of income tax preparation experts. Through democracy, states permitted completely diverse groups of people to peacefully coexist and cooperate and form civilization, in a way that would be impossible without a government. And through federalism local groups of people could have their own local government but still share the benefits of a common state.

So why in the world did the earth have many nations? Obviously the best thing in the world would be for every existing nation in the world to become a state in the United States. And then we'd all live happily ever after, or so I naively thought.

The reality is that the state is pretty much only a good thing when it is protecting us from the next level up, and/or the rest of the world. Increasing centralization wrecks the structures that man creates through the voluntary association of the free market. And unfortunately our trend is toward increasing centralization of everything. Apparently a lot of people still believe what I believed as a boy. I wonder why those same people still want nations to retain their sovereignty? If their logic is true, they should accept that one government would be good for everybody.

In the early united states, education was the private decision of each household. Near universal literacy prevailed. Then education was assumed by the community, then the state, and now finally the federal government (a federal government legally prohibited from doing so by the Tenth Amendment to the U.S. Constitution). It's only gotten worse, but at each stage flaws in the system have been used as justification for fixing things at the next higher level. Somehow making only one decision instead of fifty is supposed to magically work better. Somehow federal government is a magic realm where people can solve problems they can't solve in states. Somehow state government is a magic realm where people can solve problems they can't solve in cities or counties. Somehow government in general is a magic realm where people can solve problems they can't solve on the free market. Remember the big lie: the risk of leaving this up to people we don't control is too great.

Health care tells the same story as education, and so do a thousand other issues.

Morally, why should people in New York have the right to tell people in Kansas what to do? Why should people in Houston have the right to tell people in Dallas what to do? Why should people on the north side of Boston have the right to tell people on the south side of Boston what to do? Why should a household in Denver, Colorado have the right to tell the household living next door to them what to do? The answer is that they don't, and in fact when they do the economy produces less than it would have if left alone.

Somehow people can see that it wouldn't do to have people in China telling America what to do. Somehow they can even see that it wouldn't do to have people in England telling America what to do. Why then don't they follow that logic through to its obvious conclusion: any such institution which compels people to obey it, rather than protecting those who voluntarily join it, is immoral and damaging? If it's a bad idea for America to give up its sovereignty to a one world government, it's a bad idea Wyoming to give up its sovereignty to Washington, D.C., and it's a bad idea for Muncie, Indiana to give up its sovereignty to Indianapolis, Indiana, and it's a bad idea for the household on the north side of town to give up its sovereignty to city hall.

An institution that protects us from possible violation of our rights by other people, including by other people in institutions called states, is a good thing. In fact, it is so much of a good thing that I think we should have several of them, competing with each other, and you should choose which one you want to belong to (hire), or several if you choose and they are still willing to serve you under such an arrangment.

But compelling other people to be a member of your institution is wrong. Compelling your children to be a member of your institution after they are grown and emancipated (and even after you are dead) is wrong. The Americans of 1789 created an institution to protect their rights. (They had earlier declared their right to do this in 1776. Interestingly enough, at the same time they declared the rights of man to abolish such institutions and replace them with new ones that they thought would better secure their rights.) But creating this government in 1789 didn't obligate people who were born after 1889 to keep the agreement. (Especially since it's now conveniently reinterpreted and ignored.)

Right now the basic message defining our system of government is: "I can't protect myself from violation of my rights unless I violate your rights and compel you to help me." The reality is that individuals can protect their rights, and when they can't they can band together voluntarily in many ways to do so. The household that perceives some benefit to a local rights protecting organization can join it voluntarily, just as the household that perceives some benefit to shopping at the grocery store can shop there voluntarily.

Government-certified money

Once upon a time, people had to barter in order to trade. If you raised chickens and needed butter, you had to take a chicken to a dairy farmer and hope he needed chickens, and hope he'd give you enough butter that you wouldn't be shortchanged for your chicken, and hope you could find a use for all the extra butter, because it's hard to make change for a live chicken.

Then the free market discovered money, and if you haven't read the book I just linked to on the words "discovered money," I encourage you to leave my site immediately and go read it before finishing here, because the information there is more important than just about anything I have to say. The free market selected gold and silver as its two forms of money for several natural reasons, and soon anybody could make a better living by exchanging what they produced for money and then exchanging money for what they wanted or needed.

Of course, when you accepted a gold or silver coin as payment for something valuable you produced, you wanted to make sure you didn't get shortchanged, and you therefore wanted to make sure that you really got the amount of gold or silver you were promised. If you'll go bankrupt producing chickens for a half an ounce of gold each, then you want to make sure the one ounce gold coin you've been given really does contain an ounce of gold.

So the minting business arose and created spectacular innovations to protect its customers: gold and silver ("money") was turned into coins for portable convenience. A coin would be a uniform shape and size and contain a uniform amount of precious metal. The precious metal would be alloyed with a uniform amount of base metal in order to make the coin more durable so that the precious metal wouldn't wear away. (I have made the incredibly expensive and stupid mistake of dropping a United States gold bullion coin on my ceramic tile floor. Gold bullion coins are way too pure to be used in general circulation; there is very little base metal in them. The coin in question suffered ugly dents and little flecks of gold were seen flaking off from those dents.) The edges of the coin would be reeded so that if anyone tried to clip precious metal off the edges (do this often enough and you can make a new coin!) it would be obvious that the coin no longer contained its stated quantity of gold or silver ("money"). And the mints stamped the coins with their own seals or other indicator, giving them the chance to build a reputation for reliable coins. In Joachimsthal, now in the Czech Republic, one particular mint did such a good job that the name of its world-renowned silver coin, the Joachimsthaler, became the standard for other coins and eventually became the generic name for coins of the same weight and composition. The Joachimsthaler became the Thaler, which became the Dollar. (And then the United States government appeared and assassinated the dollar, but I'm getting ahead of myself.)

The free market therefore managed to provide the best possible protection against being cheated in money. If you didn't provide just weights and a just balance, people would actually find out, word would get around, and people would be visiting your competitors.

But liberty dies on a lie, and this is the lie: government persuaded everyone that the risk of adulterated or counterfeit money (gold and silver, remember) on the free market was too great. Despite the fact that the very best in money protection had been innovated by the free market, the government told people that this was not enough, that their money was at risk, and that they could magically help. You see after liberty is mortally wounded by the first lie, and that is that government is somehow a magic organization of people that can do what people organized in other ways cannot: protect you from the unacceptable risk of adulterated money.

And so the government had "proved" that it naturally must have a monopoly on the money supply. The government became the sole supplier of coins. Now money was government certified, and finally everybody could trust it. They could trust it so well the government hoped they didn't even find it necessary to check it. And it wasn't long until every time the government got its hands on a coin that the coin was clipped, or melted down and mixed with more base metal than it was supposed to have, in order to give the government more coins and trick people, for a while at least, into accepting less payment for the product of their hard work which government desired. So the government lied about protecting people and then perpetrated the same harm on those people. Sadly, one definition of government is a group of people with a monopoly on breaking the law. Note that in this case, the law already existed before the government even regulated the issue: private sellers have an incentive to keep just weights and a just balance; the government does not, especially when it comes to the money supply.

The big lie isn't just about money. Everywhere government tells the same story in order to kill liberty and expand its own power: there is a danger, and the risk of this danger is unacceptably great, and even though the government is just a bunch of people with fancy hats and titles they are somehow magically able to protect against this danger in a way that people organized in other fashions cannot.

Parents can't select who will teach their children; only somebody certified by the government should be allowed to do that! (And if parents want to teach their children by themselves, heaven forbid, we simply must regulate the situation and insist that the parents are certified.) It's too dangerous for people to simply select their own health care providers; the state must certify certain people as "doctors" and only they should be allowed to practice medicine. Food could contain dangerous additives and the government must look it over. Noone would preserve great natural wonders or historic monuments if the government didn't take care of them, with your money. The roads would be a warzone if we didn't license drivers. If government doesn't step in to regulate cheese, somebody might sell a lesser-quality cheese under the same name, or an identical-quality cheese from a different location which people would buy instead of the real thing, or people might even begin to think that quality is subjective. Chances are, you felt a gut feeling of agreement with some of these sentences.

Of course one of the biggest dangers to the state is the idea that anybody should be allowed to read the law and have their own opinion on it, and so practicing law without a license is of course completely forbidden.

Are there real dangers if the state isn't allowed to regulate and certify things? Yes, there are. As I showed above, in the realm of money the the free market protected against these dangers better than the government, though. Lord willing, I will later blog on two ways in which the free market protects against such dangers in general.