Why I Am An Anarcho-Capitalist

A great many people – more than ever, probably – describe themselves as supporters of the free market today, in spite of the unrelenting propaganda against it. And that’s great. Those statements of support, however, are followed by the inevitable but: but we need government to provide physical security and dispute resolution, the most critical services of all.

Almost without a thought, people who otherwise support the market want to assign to government the production of the most important goods and services. Many favor a government or government-delegated monopoly on the production of money, and all support a government monopoly on the production of law and protection services.

This isn’t to say these folks are stupid or doltish. Nearly all of us passed through a limited-government – or “minarchist” – period, and it simply never occurred to us to examine our premises closely.

To begin with, a few basic economic principles ought to give us pause before we assume government activity is advisable:

  • Monopolies (of which government itself is a prime example) lead to higher prices and poorer service over time.
  • The free market’s price system is constantly directing resources into such a pattern that the desires of the consumers are served in a least-cost way in terms of opportunities foregone.
  • Government, by contrast, cannot be “run like a business,” as Ludwig von Mises explained in Bureaucracy. Without the profit-and-loss test, by which society ratifies allocation decisions, a government agency has no idea what to produce, in what quantities, in what location, using what methods. Their every decision is arbitrary, in a way directly analogous to the problem facing the socialist planning board (as Mises also discussed, this time in his famous essay “Economic Calculation in the Socialist Commonwealth”).

In other words, when it comes to government provision of anything, we have good reason to expect poor quality, high prices, and arbitrary and wasteful resource allocation.

There are plenty of other reasons that the market, the arena of voluntary interactions between individuals, deserves the benefit of the doubt over the state, and why we ought not assume the state is indispensable without first seriously investigating to what degree human ingenuity and the economic harmonies of the market can get by without it. For instance:

  • The state acquires its revenue by aggressing against peaceful individuals.
  • The state encourages the public to believe there are two sets of moral rules: one set that we learn as children, involving the abstention from violence and theft, and another set that applies only to government, which alone may aggress against peaceful individuals in all kinds of ways.
  • The educational system, which governments invariably come to dominate, encourages the people to consider the state’s predation morally legitimate, and the world of voluntary exchange morally suspect.
  • The government sector is dominated by concentrated interests that ( I don’t think “interests” would be taken as meaning people) lobby for special benefits at the expense of the general public, while success in the private sector comes only by pleasing the general public.
  • The desire to please organized pressure groups nearly always outweighs the desire to please people who would like to see government spending reduced (and most of those people, it turns out, want it reduced only marginally anyway).
  • In the United States, the government judiciary has been churning out preposterous decisions, with little to no connection to “original intent,” for more than two centuries.
  • Governments teach their subjects to wave flags and sing songs in their honor, thereby contributing to the idea that resisting its expropriations and enormities is treason.

This list could go on indefinitely.

It’s understandable, to be sure, that people may not understand how law, which they assume must be provided in top-down fashion, could emerge absent the state, although there is plenty of good historical work demonstrating precisely this. But if government had historically monopolized the production of any good or service, we would hear panicked objections to the privatization of that good or service. Had government monopolized light bulb production, for example, we’d be told that the private sector couldn’t possibly produce light bulbs. The private sector won’t produce the size or wattage people want, critics would insist. The private sector won’t produce specialty bulbs with only a limited market, since there would be little profit in that. The private sector will produce dangerous, exploding bulbs. And so on.

Since we have lived with private light bulbs all along, these objections seem laughable to us. No one would want any of the scenarios these hypothetical critics warn about, so the private sector obviously wouldn’t produce them.

The fact is, competing sources of law have been far from uncommon in the history of Western civilization. When the king began to monopolize the legal function, he did so not out of some abstract desire to establish order, which already existed, but because he collected fees whenever cases were heard in the royal courts. Naïve public-interest theories of government, which no sensible person believes in any other context, do not suddenly become persuasive here.

Murray N. Rothbard was fond of citing Franz Oppenheimer, who identified two ways of acquiring wealth. The economic means to wealth involves enriching oneself by voluntary exchange: creating some good or service for which other people willingly pay. The political means, said Oppenheimer, involves “the unrequited appropriation of the labor of others.”

How do we in the Rothbardian camp view the state? Not as the indispensable provider of law and order, or security, or other so-called “public goods.” (The whole theory of public goods is shot through with fallacies anyway.) The state, rather, is a parasitic institution that lives off the wealth of its subjects, concealing its anti-social, predatory nature beneath a public-interest veneer. It is, as Oppenheimer said, the organization of the political means to wealth. “The State,” wrote Rothbard,

is that organization in society which attempts to maintain a monopoly of the use of force and violence in a given territorial area; in particular, it is the only organization in society that obtains its revenue not by voluntary contribution or payment for services rendered but by coercion. While other individuals or institutions obtain their income by production of goods and services and by the peaceful and voluntary sale of these goods and services to others, the State obtains its revenue by the use of compulsion; that is, by the use and the threat of the jailhouse and the bayonet. Having used force and violence to obtain itsrevenue, the State generally goes on to regulate and dictate the other actions of its individual subjects…. The State provides a legal, orderly, systematic channel for the predation of private property; it renders certain, secure, and relatively “peaceful” the lifeline of the parasitic caste in society. Since production must always precede predation, the free market is anterior to the State. The State has never been created by a “social contract”; it has always been born in conquest and exploitation.

Now if this description of the state is true, and I think we have good reason to believe it is, is merely limiting it possible or even desirable? Before dismissing the possibility outright, ought we at least to consider whether we might be able to live without it altogether? Might the free market, the arena of voluntary cooperation, really be the great engine of civilization we otherwise know it to be?

Let’s get back to the Constitution and the Founding Fathers, people say. That would be an improvement, no doubt, but experience has taught us that “limited government” is an unstable equilibrium. Governments have no interest in staying limited, when they can expand their power and wealth by instead increasing their power.

The next time you find yourself insisting that we need to keep government limited, ask yourself why it never, ever stays that way. Might you be chasing a unicorn?

What about “the people”? Can’t they be trusted to keep government limited? The answer to that question is all around you.

Unlike minarchism, anarcho-capitalism makes no unreasonable expectations of the public. The minarchist has to figure out how to persuade the public that even though the state has the raw power to redistribute wealth and fund cute projects everyone likes, it really shouldn’t. The minarchist has to explain, one at a time, the problems with each and every conceivable state intervention, while in the meantime the intellectual class, the universities, the media, and the political class combine against him to convey the very opposite message.

Instead of requiring the fruitless task of teaching everyone what’s wrong with farm subsidies, what’s wrong with Federal Reserve bailouts, what’s wrong with the military-industrial complex, what’s wrong with price controls – in other words, instead of trying to teach all Americans the equivalent of three graduate courses in economics, history, and political philosophy – the anarcho-capitalist society demands of the public only that it acknowledge the basic moral ideas common to just about everyone: do not harm innocent people, and do not steal. Everything we believe follows from these simple principles.

There is a huge literature dealing with the most frequent and obvious objections – e.g., Wouldn’t society descend into violent strife as armed bands fought for turf? How would disputes be resolved if my neighbor chose one arbitrator and I chose another? A short essay can’t answer all objections, so I refer you to LRC’s anarcho-capitalism bibliography, assembled by Hans-Hermann Hoppe.

There’s a joke that’s been going around over the past few years: what’s the difference between a minarchist and an anarchist? Answer: six months.

If you value principle, consistency, and justice, and oppose violence, parasitism, and monopoly, it may not take you even that long. Start reading, and see where these ideas take you.

Llewellyn H. Rockwell, Jr. [send him mail], former editorial assistant to Ludwig von Mises and congressional chief of staff to Ron Paul, is founder and chairman of the Mises Institute, executor for the estate of Murray N. Rothbard, and editor of LewRockwell.com. His most recent book is Against the State: an Anarcho-Capitalist Manifesto. Follow him on Facebook and Twitter.

This commentary originally appeared at LewRockwell.com and is reprinted here under a Creative Commons license

The views expressed in this opinion article are solely those of their author and are not necessarily either shared or endorsed by WesternJournalism.com.

Pope Francis Contradicts Himself On Religious Liberty And Capitalism

While visiting the White House on his first day in the United States this year, Pope Francis made a strong plea on behalf of religious liberty, which he pointedly directed at President Obama. This came shortly before he made an unscheduled visit with the Little Sisters of the Poor, who are suing the Obama administration over their own right not to include artificial contraception as part of their health insurance plan, which is mandated by Obamacare regulations. Catholic teaching views the use of artificial contraception as sinful. The connection between his comments to the president and his visit with the Little Sisters was apparent.

This laudable and welcome stance comes from a Pope who has, out of a concern for the poor, famously made several misguided statements that are quite critical of capitalism. Combined, these two positions, while seemingly unrelated, represent a profound contradiction in the Pope’s thinking.

In reality, the only socio-economic arrangement that guarantees the rights of all people to exercise their religious beliefs freely is free market capitalism, which emphasizes the rights of people to own and use property as they wish and to contract freely with others on any mutually agreeable terms.

It is a system that is based strictly on voluntary cooperation and that de-legitimizes the use of force and fraud. (As an aside, I personally think that, for this reason, it is the system most consistent with Christianity.) Under such institutional arrangements, there would be no need for specific legal or constitutional protections for religious liberty. These liberties are inherent in the system itself.

Consider, for example, the contraception mandate that is being challenged by the Little Sisters of the Poor. This directly conflicts with one of the most basic rights under capitalism: the right to trade and make contracts freely with others.

Under laissez-faire, or, as some are calling it, “unfettered” capitalism, what is covered by any health insurance policy purchased by the Little Sisters of the Poor would be a private matter among the Little Sisters, their insurance company, and possibly any employees who would also be covered under the plan.

If the health insurance plan that was being offered by the insurance company was unacceptable to the Little Sisters, for whatever reason, they would be free to walk away from it or negotiate different coverage with the insurance company. And if the health insurance offered by the Little Sisters to any of their employees was an unacceptable part of their compensation package, they too would be free to walk away and find employment elsewhere or forgo the employer-provided insurance and purchase a separate plan of their own choosing. This might occur as part of an exchange with the Little Sisters, their employers, for a higher wage. All of this would happen without a need for any specific discussion about religious liberty. The Little Sisters’ religious freedom and their freedom to make mutually agreeable contracts are one in the same.

Beyond this, the right to worship as one chooses would be pretty hollow without the right to own or contract for the rental of physical property. The right to worship implies the right of a religious organization to have physical space to assemble and to worship in that space as they see fit. Without this fundamental property right, which is only guaranteed without question under capitalism, the right to worship freely as one chooses is tentative at best and nonexistent at worst.

The right to deny religious liberties stems from the power of government to deny the right to use property freely. When the USSR wanted to shut down the Catholic Church in Ukraine, it confiscated its property, i.e., the churches. The Soviets understood quite well that the right to freely worship was the right to freely own.

This does not end with religious liberties. Indeed, property rights and free exchange are at the heart of one’s ability to exercise civil liberties more generally. The right to freedom of speech and press and the rights to freely assemble, protest, boycott, etc., are all automatically guaranteed under capitalism.

This is because capitalism guarantees our right to disagree with one another, which is really what is being protected when all of these liberties are recognized. In this regard, it would be useful for Pope Francis to pay attention to the words of a rather famous atheist, Ayn Rand, who noted that:

The right to agree with others is not a problem in any society; it is the right to disagree that is crucial. It is the institution of private property that protects and implements the right to disagree.

Holy Father, religious liberty is nothing more than the right to disagree.

This commentary originally appeared at Mises.org and is reprinted here under a Creative Commons license

The views expressed in this opinion article are solely those of their author and are not necessarily either shared or endorsed by WesternJournalism.com.

The Campaign Needs A Radical, But Sanders Isn’t It

We could use a radical in the presidential race — someone who really challenges the status quo — but Bernie Sanders isn’t it. Sanders of course calls himself a democratic socialist, but that tell us almost nothing. One gets the impression the socialist label was pinned on him and, after resisting it, decided socialist sounded romantic and embraced it.

Nevertheless, whether you like socialism or not, Sanders is not a socialist: he calls neither for nationalizing the means of production nor for replacing the market economy with central planning. Yet that is what socialism came to mean in the mid-20th century. Democratic socialism meant that socialism would be achieved through the ballot box.

It is worth noting that in late 19th- and early 20th-century America, socialism was an umbrella term that was also used by radical free-market, or individualist, anarchists like Benjamin R. Tucker and Francis Dashwood Tandy, who called his 1896 book Voluntary Socialism. A socialist then was anyone who objected that workers were cheated out of their full reward and that prices of goods were fixed above the cost of production; in contrast to state socialists, free-market socialists attributed these evils to “capitalism,” by which they meant the system of government privileges for well-connected owners of capital.

What Sanders favors is an expanded welfare/regulatory state, i.e., more of what we have. When asked about socialism, he praises Medicare. Medicare, however, is not socialism, nor would single-payer for all be socialism. Under state-socialized medicine, government would own and operate the hospitals, and doctors and nurses would be government employees — like the post office without competition. Under single-payer, government would pay the bills for private-sector medical care and impose controls that powerful interests would inevitably manipulate to their advantage. Sound familiar?

The welfare state was established by western ruling classes to tamp down discontent among the powerless that had the potential to turn revolutionary. The father of the modern welfare state, Otto von Bismarck, intended government-administered social insurance to keep the Prussian working class loyal to the regime and out of the Marxist and liberal (libertarian) camps. In England, workers initially resisted the welfare state because it was seen as a move by the aristocracy to co-opt the labor movement, which sought to redress its grievances directly.

Sometimes Sanders says that being a socialist means merely that he’s neither a Democrat or a Republican. That’s not terribly informative. At other times, he says it signifies concern about gross income disparities, the high cost of college, and the lack of access to medical care. Again, this doesn’t tell us much since radical libertarians share those concerns. What matters are the solutions. Two people can look at the same social problem and argue over whether the best approach is more government, less government, or no government at all. Sanders’s preference, more government, would mean expanded bureaucratic control and special-interest “capture,” i.e., more of what already ails us.

In 1986, Sanders said, “All that socialism means to me, to be very frank with you, is democracy with a small ‘d.’ I believe in democracy, and by democracy I mean that, to as great an extent as possible, human beings have the right to control their own lives.” Considering that Sanders’s program would empower bureaucrats rather than people, one could consistently endorse Sanders’s objective while opposing his proposals. (See my “Free-Market Socialism.”)

He also said, “What being a socialist means is … that you hold out … a vision of society where poverty is absolutely unnecessary, where international relations are not based on greed … but on cooperation … where human beings can own the means of production and work together rather than having to work as semi-slaves to other people who can hire and fire.”

Again, these are objectives that any radical free-market libertarian could embrace. Where Sanders goes wrong is in aiming to empower bureaucrats and politicians.

Sanders cannot or will not see that expanding the welfare/regulatory bureaucracy would not help those outside the ruling elite. Beefing up the state won’t liberate us. Despite his intentions, Sanders is an unwitting defender of the status quo.

Where is the radical who will make the case for individual liberation and purely voluntary social cooperation through freed markets?

Sheldon Richman keeps the blog Free Association and is a senior fellow and chair of the trustees of the Center for a Stateless Society. Become a patron today!

The views expressed in this opinion article are solely those of their author and are not necessarily either shared or endorsed by WesternJournalism.com.

Why We Need Private Property To Deal With Scarce Resources

Scarcity of resources exists in many forms and is the problem in economics. If resources were not scarce, there would be no need to economize. The existence of scarcity is true of all resources (such as time, human energy, and natural resources). However, it is not necessarily intuitive that allowing scarce resources to be owned privately is the solution to this problem.

Consequently, socialism appears attractive to many, and they turn to having all resources owned collectively for the “common good.” Unfortunately, a society which spurns private property — and hands resources over to government planners instead — often learns the terrible lessons of central planning and the tragedy of the commons (i.e., commonly held resources will be plundered to extinction).

If society spurns allowing private ownership of resources, it must find some other means to prevent the tragedy of the commons and to allocate goods. Historically, the means chosen is the use of force and central planning. Throughout history, most of mankind has been divided into a hierarchical system of masters and slaves with some gradations between the two extremes. The masters (pharaohs, emperors, kings, sultans, warlords, etc.) devised complex rules-based systems for resource distribution that were decided by a small number of people and not by markets. And ultimately, these plans depended upon pure terror for enforcement. But this so-called solution to the problem of scarcity — restricting the people’s liberty through the use of force — does not work.

Problem 1: We Can’t Economize Without Effectively Ordering Our Preferences First

The gradual growth in the understanding of what we now regard as basic economics eventually ended thousands of years of subsistence existence for the masses in the West. Modern economics explained that without private ownership of resources, there was no mechanism for observing or acting on ordinal preferences in which persons prioritize desires from highest to lowest. Without a way to allocate goods according to ordinal preferences, there is no rational means to economize for the betterment of society.

In other words, without markets and prices, there is no way to know what people really want or need, so the masters never really knew what to order the slaves to produce, what technical means to use, what alternative materials to use, the quality desired, or how much to produce. Thus, the commissars of the Soviet Union ordered the production of inefficiently produced, shoddy goods. The Soviet empire collapsed, despite the fact that Russia is blessed with vast natural resources and an industrious population.

Problem 2: Few Raw Materials Are Ready to Consume

A second fatal problem with common/government ownership of resources is that few readily available, consumable resources actually exist. There are no resources on the planet that do not require at least a minimum of effort to transform into a consumable product. Even edible berries growing in the wild must be harvested, meaning that someone must transport himself to the berries’ location and pull them from the bush at just the proper time. The cost of doing so is the value one places on forfeiting his leisure. Of course, other natural resources require much more effort to convert to consumable products, passing through many stages of production.

For example, timber and minerals must be extracted, harvested, etc. and then molded into something that can be consumed. Consider a hiker lost in the wild. It matters not at all to him that great stands of timber lie within easy reach or that valuable minerals lie under foot. These natural resources require great effort over very long time periods to be converted into something consumable, as is the case with converting timber into a shelter or crude oil into gasoline. A lost hiker does not have the knowledge, time, or previously produced means to convert these basic resources into consumable products to ensure his survival. All this is far beyond anyone’s autarkic abilities.

Now let us assume that someone did harvest trees by felling them, transporting them to a lumber mill, milling them, storing them in a ventilated and dry place for many months before kiln-drying them (all processes that are required to turn trees into useable lumber), advertising their availability to contractors, keeping sales records, sending out bills, and collecting the bills, only to have a socialist call him a plunderer and confiscate his lumber for free distribution to whomever the masters deemed to be politically advantageous to their continued privileged position. No one other than the favored cronies of government would ever harvest another tree. In other words, production of usable lumber would be monopolized; and as with all cases of monopolies, prices would increase and quality would decline. Moreover, with no voluntary market at work in timber and forest land, there would be no means of knowing if these resources were being used in a way valued by those who valued them most.

At the same time, the central planners could not let just anyone harvest the trees or access the land. If the trees had no owners, great forests would be denuded in short order because there would be no social mechanism to prevent what would amount to a tragedy of the commons by order of the state.

Problem 3: We Need Private Property to Build Capital

Without the ability to profit from privately owned property, there would be no incentive to provide or withhold capital for any endeavor. Also, a system of private ownership is necessary to determine if that capital is being used in a way the consumers value. The consequences of ignoring this fact of economic science is most evident today in China’s ghost cities, where resources, both natural and human, have been expended for no observable benefit except to advance the careers of politicians who can claim to have met the requirements of the latest Five Year Plan. Timber and other resources were provided to build ghost cities, not because the owners of the resources sought to be economical with their resources, but because government edicts required that timber, concrete, gasoline, and more be used to produce what are now empty cities.

The opposite case of resource waste comes from special interest groups who capture the political apparatus of the state and prohibit exploitation of resources by private individuals. In the name of protecting Mother Gaia from being plundered, modern environmentalists have convinced the political class that most progress is unsustainable, dangerous to our health, or any number of other specious claims. Society is prevented from benefiting from their conversion to consumable products. The poor suffer the most from these policies as the prices of raw materials — and thus finished consumer goods — are driven up.

Private ownership insures that valuable resources will never be plundered to extinction, because their value will have been capitalized. Instead, private owners will seek to make resources as widely available as possible without endangering the long-term prospects for future harvesting of resources. The process of determining a resource’s capitalized value is impossible absent free-market capitalism with strict defenses of property rights.

Despite both the theoretical and empirical evidence to the contrary, socialists tell us the opposite; i.e., that state ownership of all resources will prevent their plunder and ensure prosperity for all. As Ludwig von Mises explained, though, socialism is not an alternative economic system of production. It is a system of consumption only, and a system of economic ignorance and economic plunder.

This commentary originally appeared at Mises.org and is reprinted here under a Creative Commons license

The views expressed in this opinion article are solely those of their author and are not necessarily either shared or endorsed by WesternJournalism.com.

Rush Just Revealed The ‘Over-The-Top Unbelievable’ News That Took Him To ‘Twilight Zone Territory’

On Monday, Rush Limbaugh discussed Microsoft’s founder and his recent comments on climate change.

Limbaugh was very clear that there was madness in Bill Gates’ recent pronouncement that capitalism cannot save the world from climate change. He was also clear that there are ulterior motives beneath Gates’ words.

“This is one of the craziest, nonsensical things I have ever in my life heard,” Limbaugh said. “I understand why he said it. But it is just over-the-top unbelievable. Bill Gates says that capitalism cannot save us from climate change. Bill Gates says that socialism is the only thing that can save us from climate change.”

Limbaugh also quoted Gates as saying, “Since World War II, U.S.-government R&D has defined the state of the art in almost every area. The private sector is in general inept.”

“This is just mind-boggling to me,” Limbaugh said. “This is Twilight Zone territory for me. This is surreal.”

Limbaugh went on to explain the evidence linking the most polluted nations with socialist governments.

The talk show host said be believed that for Gates it was not about global warming but money. He noted that as long as there have been men with riches, those men have feared having their money taken away. “Gee, I hope the peasants with pitchforks leave me alone and don’t storm my castle,” Limbaugh said.

To avert that, some super-billionaires embrace feel-good causes, Limbaugh said.

“It is that belief of mine, that theory, which I have come up with to explain why people like Gates and Buffett and a number of these other super billionaires talk like Marxist liberals all the time. It is to keep people away from their money,” Limbaugh said.

He said that Gates and others seek to manipulate public opinion.

“Get the geek, nerd crew on your side loving you and supporting you, it’s a bunch of Millennial young leftists and then keep the peasants with pitchforks away from you by removing your billions as a threat to them ’cause you’re a good guy,” he said.

“It is to send the message, ‘Hey, we don’t threaten you, leave me alone. I’m spending all my money on philanthropy. I’m giving money to AIDS. I’m giving money to Africa. I’m giving money to global warming. I’m giving money to the arts. I’m giving money to support gay marriage and transgenders. Leave me alone,’” Limbaugh said.

h/t: TheBlaze