A brief book by Economics Professor Robert Murphy of Hillsdale College, titled, Chaos Theory: Two Essays on Market Anarchy, offers an original and innovative glimpse into possible mechanisms whereby a society in the complete absence of government could furnish the essential and universally needed services of law (including enforcement) and defense against foreign aggression. As a minarchist Objectivist, I would, of course, consider precisely these two areas as the legitimate province of a government, defined as an agency claiming monopoly on the ultimate direction of retaliatory force within a given territory.

Nonetheless, in reading Dr. Murphy’s book, I have been challenged to consider the nature of the system that he has proposed and engage it with full honesty of mind, neither accepting nor rejecting any part of his analysis without a clear reason to do so. As a result of this approach, I have produced a series of targeted commentaries, questions, and responses to Dr. Murphy’s specific claims regarding the function of an anarcho-capitalist society.

Not all of my comments are definite positions, however; some are genuinely open-ended inquiries on which I would be interested to receive feedback from anarcho-capitalists or anybody with input on Dr. Murphy’s theory. Before I delve into the particulars, however, it is necessary for me to express my compliments for Dr. Murphy’s clear and articulate writing style, extensive application of economic principles and historical parallels, and employment of fundamental premises on which we largely agree. Dr. Murphy’s system, if it is ever actualized in full, would be far superior in nature to the bloated behemoth of a welfare state that oppresses Americans and most other individuals today. It is far better to have too little government than too much, and all of my disagreements with Dr. Murphy will address the question of where precisely to draw the line in the reduction of the State, as opposed to the desirability of such reduction, on which we would both wholeheartedly agree.

 

Criminal Justice

           

Dr. Murphy’s first essay, “Private Law,” concerns the application of market anarchy to the resolution of disputes and the curtailment of crime in the domestic realm. One of the most critical questions to ask about the anarchist system is, “What types of punishments would be dealt to criminals, especially murderers, and how would they be enforced?” Dr. Murphy writes:

 

“Of course, one of the most basic stipulations in any contractual relationship—whether entering a mall or living in a neighborhood co-op—would be strong prohibitions on murder. In other words, all contracts of this type would have a clause saying, ‘If I am found guilty of murder I agree to pay $y million to the estate of the deceased.’ Naturally, no one would sign such a contract unless he were sure that the trial procedures used to determine his guilt or innocence had a strong presumption of innocence; nobody would want to be found guilty of a murder he didn’t commit. But on the other hand, the procedures would have to be designed so that there were still a good chance that guilty people would actually be convicted, since people don’t want to shop in malls where murder goes unpunished.” (Chaos Theory, 13-14)

 

I have several concerns about this type of system:

 

1) What will happen to the application of the death penalty for murder, especially murder of a most gruesome sort? Could certain contracts include a clause, “If I am found guilty of murder, I agree to be executed by Execution Agency X.”? It is my conviction that fines alone would never suffice to either deter crime or punish the criminal, as the criminal, even after having paid the fine, is free to commit further acts of violence (especially large-scale theft, to regain the lost money).  Furthermore, this type of system presumes that the criminal is a rational being capable of recognizing a large financial disincentive and acting accordingly. However, the more egregious the criminal is, the less rational he is (as, by definition, the initiation of force is irrational, and the degree of initiation of force by a criminal correlates with the degree of his irrationality), and the less he will care about matters that might deter a prudent individual from crime. Often, the only way to deter a hardly sane, rampaging murderer is to cause him to cower in primordial fear for his very existence. If such a deterrent fails, then, again, to prevent further murders, there is no option but to take this criminal out of existence.

 

2) What if the criminal (or a foreign army) breaks onto another’s property without signing or agreeing to any contract stipulating what would occur to him/it in the event a crime of any magnitude is committed? What law would such an entity be subject to? Would there be some “universal law of the land” to default to in that case? If so, who would enforce it, or at least authorize its enforcement? And if so, would this agency (even if it merely granted permission for the property owner to retaliate) not need to be remarkably similar to a highly limited government?

 

3) An argument can be made that, by entering somebody’s property, one implicitly accepts the contracts that the property owner associates with it. However, in this case, how does one guarantee that the implied consent was made in an informed manner? What can prevent Owner Y from claiming, “Person X set a foot in my property while wearing a green shirt, which, under the terms I had established, makes him liable for a $1 million fine.”? (In the meantime, Owner Y had failed to display this clause in prominent public view on the borders of his property, so Person X entered it without knowledge of these terms.) Would not there need to, again, be some universal law of the land to determine which claims of contractual violations are reasonable and worthy of compensation, and which are plainly ludicrous?

 

Dr. Murphy contends that, under market anarchy, an insurance-like system would ensure payment of damages to individuals violated by crime:

 

“Under this system, the victims of crime are always paid, immediately. (Contrast this to the government system, where victims usually get nothing except the satisfaction of seeing the criminal placed behind bars.) There would also be incentives for people to behave responsibly. Just as reckless drivers pay higher premiums for car insurance, so too would repeat offenders be charged higher premiums for contract insurance.” (Chaos Theory, 15)

 

Again, this system leaves certain areas open to contention:

 

4) Would higher fines matter to repeat criminals? Would it even matter to them if they had no insurance at all? After all, if monetary payment of premiums is the only thing that would be demanded of them under market anarchy, would they not be able to easily rid themselves of that burden by renouncing insurance altogether? What would then prevent them from finding like-minded souls and establishing large-scale criminal gangs that, instead of relying on conventional insurance, would offer mutual protection in exchange for a free hand at thievery and murder with respect to everybody else?

 

5) What would happen to criminals too poor to pay the inflated insurance premiums resulting from their criminality? How would they be held responsible for their actions? One might suggest the scenario of the insurance company refusing to maintain them as its clients. Would, then, crimes by these criminals remain un-compensated on the free market, as no insurance company would offer victims payouts corresponding to their losses?

 

6) By corollary to #4, is monetary compensation the only necessary way to reward crime victims and their families, especially in cases of rape, murder, and other irreversible crimes? Can a price tag be placed on human life? Some damages are permanent and irreparable and leave only the satisfaction of revenge against the criminal as a compensation approaching anywhere near the value of what was lost. Currently, the government provides such revenge in the form of criminal punishment such as imprisonment and execution. How would the free market handle revenge-based penalties for egregious criminals?

 

7) Furthermore, what would happen if the insurance company were to violate the contract it had established and use force against one of its clients to procure his compliance with some arbitrary imposition? Since the insurance company possesses more resources than an individual (and agreements with large enforcement agencies), and would be his sole link to protection under “market law,” what recourse would the individual have against such violations?

 

Dr. Murphy further elaborates on disincentives to crime under anarcho-capitalism:

 

“And why would the person with criminal proclivities care about his insurance company? Well, if he stopped paying his premiums, his coverage would be dropped. With no one to underwrite his contractual obligations, such a person would make a very poor customer or employee. People wouldn’t hire him or trust him to browse through a china shop, since then there would be no ‘legal’ recourse if he did anything ‘criminal.’” (Chaos Theory, 16)

 

8) Could not, then, this criminal merely choose to follow a life of crime altogether and refrain from any peaceful interactions, except for fellow criminals in his gang? Why would it matter for him if he would not be able to purchase anything or work for anybody? Would he and his fellow mobsters not be able to simply steal what they need? And, given that these criminals have renounced their insurance, how would their victims be protected? Furthermore, if the victims’ own insurance companies were to provide either monetary compensation or some concrete retaliatory capacity, would not the victims’ premiums typically increase? How is it justified for innocents imperiled by crime to nonetheless suffer additional loss of property in the form of raised insurance costs?

 

Protection of Children

 

Dr. Murphy proceeds to offer some ideas on how a free market would ensure that children would receive adequate treatment:

 

“[T]he basic “prohibitions” on parental child abuse and neglect could be stipulated in the marriage contract. In addition to whatever romance may be entailed, a marriage is ultimately a partnership between two people, and prudent couples will officially spell out this arrangement, with all of its benefits and obligations. For example, before abandoning her career to raise a man’s children, a woman may require a financial pledge in case of divorce… In the same way, a standard clause in marriage contracts could define and specify penalties for the improper treatment of children.” (Chaos Theory, 20-21)

 

9) Contractual guarantees for the protection of children in marriage are a step in the right direction; I have myself argued for such a solution previously. Nonetheless, these guarantees will only extend to children of married couples. What shall happen to children born out of wedlock? How, under market anarchy, would any entity concerned with the child’s well-being be able to mandate that the parents marry or, at least, sign some contract which guarantees proper treatment of the child? Moreover, who would be able to protect the rights of the child born out of wedlock, whose parents do not wish to marry or sign a contract of parental obligation to the child? Would those parents be able to inflict abuse and/or neglect upon the child with impunity?

 

Dr. Murphy continues on this topic by proposing an anarcho-capitalist answer to the issue of abortion:

 

“The controversial issue of abortion, just as other conflicts in a private law system, would be handled by competing firms setting policies to best match the desires of their customers. Those people sufficiently horrified by the practice could establish a gated community in which all residents agreed to refrain from abortion, and to report anyone caught performing one.” (Chaos Theory, 21)

 

10) What would happen to a person living in such a community who committed an abortion and then tried to leave? Would market law provide for clauses that would make escape from such a community punishable? If such a person escaped successfully, would the market law provide for measures to catch and penalize her?

 

11) If it were possible to establish gated communities in which abortion would be illegal, would it be possible to also establish gated communities in which abortion would be not only legal but encouraged? Would market anarchy also tolerate the existence of communities which mandated abortions for their members (much like the government of China tries to do today)? How could such communities be resisted in the absence of a government?

 

12) If market law were able to provide for clauses preventing an individual from leaving a community under certain circumstances, would it be possible for communities to spring up where individuals born there could be forced to stay against their own will? Let us presume, for example, a cult-like gated community based on the premise of self-sacrifice as the good. A child was born to parents who are willing members of this community, yet the child abhors the mentality of self-sacrifice. Would he be forcefully prevented from leaving or from resisting any attempts by community members to compel sacrifices on his part? If not, what agency would protect him? (This is assuming that members of the community are wary of outsiders and insist on policing themselves and signing contracts with no external parties.)

 

13) By extension from #12, what would distinguish such a coercive sacrifice-based gated community from a “mini-state?” What would prevent the emergence of such entities, which would wholly defeat the very purpose of abolishing the State and instituting market anarchy?

 

 “Community Norms”

 

Subsequently, Dr. Murphy proceeds to explain how property titles would be enforced in a society where no government exists to recognize them:

 

“The fear of rogue agencies unilaterally declaring themselves ‘owner’ of everything, is completely unfounded. In market anarchy, the companies publicizing property rights would not be the same as the companies enforcing those rights. More important, competition between firms would provide true ‘checks and balances.’ If one firm began flouting the community norms established and codified on the market, it would go out of business, just as surely as a manufacturer of dictionaries would go broke if its books contained improper definitions.” (Chaos Theory, 22)

 

14) The notion of “community norms” defining property, or anything, for that matter, seems inherently prone to injustice for multiple reasons. There is, first of all, no guarantee that community norms will be in accord with objective justice or objective reason, and this discord is most often the case. Any approach that attempts to set the two as equivalent borders on a variant of “direct democracy,” which, as scholars like Hans-Hermann Hoppe have shown, would only lead to majorities voting themselves the money and property of minorities while resulting in a high rate of time-preference among politicians. Furthermore, let us presume, for example, that a registry firm decides to, under this system, be fully diligent and honest in recording property titles in accordance with what individuals actually inhabit, own, and develop their corresponding properties. This implies that such a company has decided to record the rightful property of Person X, who happens to be an extremely unpopular outcast within the community. Approximately a hundred “squatters” would like to evict Person X from his land so that they might parcel it out amongst themselves, and most people in the community are socialists who agree with them. Would this registry firm lose a substantial clientele and thus be placed at a disadvantage with respect to those registry firms that do not record Person X’s rightful property and are thus more in accord with “community norms”? How, then, is it justified for a firm respecting property and individual rights to be disadvantaged by a system of market anarchy over a firm complicit in the injustice of violating such rights?

 

Another potential pitfall in Dr. Murphy’s theory comes in the form of the issue of arbitration:

 

“Finally, keep in mind that the ultimate judge in a given case is… the judge. No matter how voluminous the law books, or how obvious the precedents, every case will ultimately depend on the subjective interpretation of an arbiter or judge who must deliver the ruling.” (Chaos Theory, 23)

 

15) The principles behind this statement are essentially correct; laws are scraps of paper without proper enforcement and an intellectual spirit conducive to their efficacy. However, under market anarchy, there is no single definite system of courts nor is there a hierarchy of appeals courts. Let us presume that two disputing individuals, A and B, have agreed to settle their case via Arbiter C. Arbiter C settles the dispute in favor of A, but B is not content. He appeals the case to Arbiter D, who rules in favor of B. Both C and D are of about equal reputation and stature; they just disagree over a complex matter. Furthermore, A and B, seeking to resolve this dispute, appeal to a multiplicity of high-profile private arbiters who are sharply divided on the issue. If none of these arbiters has positional superiority over any other, whose ruling should be carried out? Furthermore, what would prevent appeals ad infinitum by every dissatisfied party (especially an extremely wealthy dissatisfied party with the capacity to file such prolonged appeals)? Arbitration on a free market is often an effective means of conflict resolution; private businesses have had elaborate systems of market arbitration for centuries. However, in the event of an irreconcilable dispute, I am inclined to believe that there should always be a final court of appeal, i.e., the Supreme Court, which would have the power to issue an ultimate ruling and close an extremely volatile and contentious case.

 

16) Furthermore, it does not necessarily follow that a single hierarchy of judges or an ultimate court of appeal will emerge on the free market. People will always disagree about who is the most skilled, competent, and authoritative judge, if recent opinion divisions in the United States on such matters are any indicator. It is even likely that multiple competing hierarchies would emerge, each sharply differing from the other in terms of fundamental legal principles and practices, in which case the potential of individuals dissatisfied with one hierarchy pushing a favorable appeal through the other is immense. How would those cases be resolved without a massive “judicial power struggle”?

 

Furthermore, Dr. Murphy’s theory acknowledges an absence of rigidly defined a priori legal structure:

 

“Now, after we have reached such agreement [market law prohibiting murder] and are secure in our lives, we can let the philosophers and theologians argue about why murder is wrong. Legal scholars offering a priori constructions of just law would certainly have a place in market anarchy; after all, their tracts might influence judges’ decisions. However, in this essay I focus on the market forces that will shape private law, not on the content of such law.” (Chaos Theory, 25)

 

17) Are not market forces themselves contingent on valid law, public or private, and its stringent enforcement, for survival? Countries where prosperous free markets emerged have almost always been based either on a firmly entrenched centuries-old British legal tradition (which proved successful even in East Asian territories like Singapore and Hong Kong) or on policies inspired by the Austrian School of Economics (as in pre-World War I Austria-Hungary, Ludwig Erhard’s West Germany of the 1950s, and Eastern European countries today). In the absence of principled, theoretically-based law, will not a society more resemble the tribal chaos of Somalia (or most of the rest of Africa, for that matter) and simply revert to a Hobbesian state of nature? If theoretically based law is indeed necessary for functional markets, who will introduce this law into a society and who will make certain that it is adhered to?

 

Market anarchy might even pose a threat to the individual’s privacy, however paradoxical this might seem at first glance:

 

“But there are other factors that an insurance company would take into account when setting premiums, besides past behavior. And one of these factors would undoubtedly be: What sort of weapons does this client keep around the house? After all, if the insurance company is going to agree to pay, say, $10 million the estate of anyone Joe Smith kills, the company will be very interested to know whether Smith keeps sawed off shotguns—let alone atomic weapons—in his basement. Someone who keeps such weapons is much more likely to harm others, as far as the insurance company is concerned, so his premiums will be that much higher. In fact, the risk of a client who kept nuclear (or chemical, biological, etc.) weapons would be so great that probably no policy would be offered.” (Chaos Theory, 30)

 

18) This poses an immense privacy concern and a loophole that could be expanded into areas beyond who owns what weapons (revealing which information might not, in itself, be of interest to a given individual). But the weapons example might suffice here. It seems that the following chain of reasoning could be derived from the above passage. Insurance company protection is required for survival under market anarchy (we will grant this premise for the time being). But the insurance company demands information about what types of weapons one owns. Giving away this information might intrude on one’s privacy. Then, by implication, is a disregard for one’s privacy necessary for survival under market anarchy? Furthermore, the disregard for privacy might extend to areas other than weapons ownership. Perhaps a given insurance company might come to be interested in whether Person X stockpiles hundreds of radical political flyers in his basement, since political radicals are more likely to be assaulted or even assassinated by angry fanatics.  If Person X used to engage in fights in elementary school, would the insurance company want to know his childhood school record to monitor for “violent tendencies” which might lead to higher payouts by said company? What about the most dangerous privacy violation of them all: required psychological testing for said “violent tendencies”? How would market anarchy contain mechanisms to safeguard against the ubiquitous emergence of such demands as prerequisites for individuals receiving that all-important insurance policy?

 

Furthermore, Dr. Murphy contends that, under market anarchy, “community norms” might also have an even greater role to play in the treatment of an individual accused of crime:

 

 “There is another difference. Under a government system, someone acquitted on a technicality gets off scot-free. But under the private law system I’ve described, the killer’s insurance company could still increase the premiums they charged. It wouldn’t matter whether their client had been actually convicted of a crime; their only concern would be the likelihood that he would be convicted (of a different crime) in the future because then they’d have to pay the damages.” (Chaos Theory, 31-32)

 

19) I have a far more pessimistic interpretation of this tendency: it is a potential for people genuinely innocent of crime to be maligned and mistreated if public opinion is opposed to them. Consider, for example, an individual like O.J. Simpson, hated by the majority and presumed guilty of murder, even though the courts failed to find evidence to convict him. Why should Simpson and those in similar positions continue to be placed at an inherent legal disadvantage despite their probable innocence when objective criteria of judgment (as opposed to majoritarian ones) are employed? Furthermore, the case of the simply unpopular individual can be brought up. Let us return to the example of Person X, who is ostracized by a community of socialists. These socialists keep filing unjustified lawsuits against Person X, although Person X is acquitted every time. Would Person X’s premiums increase simply because he is forced to be a defendant such a high number of times, thus increasing his probability of being convicted on any given occasion? How can it be considered justice for those objectively innocent of breaking the law to receive potentially the same treatment as those convicted of violations?

 

Private Defense

 

Dr. Murphy’s second essay, “Private Defense,” concerns the provision of market protections against external aggression (initiated presumably by dictatorships or welfare states, since anarcho-capitalist societies are claimed not to engage in military expansionism).

 

 Dr. Murphy suggests a mechanism by which such private defense could be accomplished:

 

“In a free society, it is not the average person, but rather the insurance companies, that would purchase defense services. Every dollar in damage caused by foreign aggression would be fully compensated, and thus insurers would seek to protect their customers’ property as if it were their own. Because of economies of scale, coverage for large geographical regions would likely be handled through a few dominant firms ensuring standardized pricing and coordinated defense.” (Chaos Theory, 41)

 

20) Let us grant, for the sake of argument, that these insurance companies would have a financial incentive to fight a protracted war of defense where both sides still have considerable resources at stake. However, if the enemy were to launch a surprise attack, quickly destroying much of an anarcho-capitalist society’s infrastructure, the insurance companies would already have enormous expenses to pay. What would be their motivation to accrue additional expenses by providing further defense and continuing the fight? What would prevent them from surrendering to the enemy, signing some manner of deal permitting the continuation of their existence under the framework of the invading government, and avoiding payment of further damages?

 

On p. 42, Dr. Murphy suggests a mechanism whereby insurance companies would have increased incentives to actually provide defense services to their customers and thus lessen the possibility that an invader will damage their customers’ property and bring about the need for the insurance companies to pay out damages. However, this leads to further questions:

 

21) Let us presume that a neighbor of the anarcho-capitalist society is a dictator analogous to Saddam Hussein, who has repeatedly shown himself to be prone to aggression, yet who has never invaded the anarcho-capitalist society. The insurance companies’ analysts predict that the cost of invading the neighboring State and displacing the dictator would be lower than the costs to be incurred in the event that said dictator were to invade. Would market anarchy be able to facilitate pre-emptive strikes against territories with a State? Would neighboring states be sufficiently deterred by the threat of such a pre-emptive strike as to behave in a manner conciliatory to the anarcho-capitalist society?

 

22) Granting that the free market will eventually develop defensive armies (and likely superior ones to government armies, as mercenary forces and private contractors have shown time and again throughout history), the rate at which such forces emerge is also a point of contention. The growth of services on a free market is almost always evolutionary and gradual, which, in the long term, would lead to services that have stood the test of time. However, what of the short term? How can a freshly emerging anarcho-capitalist society address the threat of dictatorial or welfare states on its borders, posing a military threat now, before competition can yield the optimal retaliatory capacities?

 

23) Would it not be superior to a complete anarchy in terms of the military to have private competition be fostered within the parameters of a single government? Consider the American government’s current use of multiple competing airplane and tank designers in order to obtain the best available weapons technologies, or its use of private contractors in Iraq. Might it be possible for governments to simply deregulate the military further and render it entirely dependent on mercenaries, contractors, and competing insurance companies while still maintaining that only the government has the authority to either hire these entities to undertake military activities or to simply issue permits for these entities to carry out military actions within a strictly defined and limited scope? In this manner, a society might reap the benefits of both market competition and a restraining hand on the military’s activities in the form of an ultimate authority on said activities. (The market would, in that case, set prices, by the way, in accord with actual supply and demand, thus addressing Dr. Murphy’s contention that a government monopoly on services inherently disregards their actual worth.)

 

While a government is theoretically obliged to protect everybody within its jurisdiction, under market anarchy this is not the case. Dr. Murphy comments on markets overcoming the “free rider” problem in defense (i.e. the problem of people who have not paid for the service receiving it nonetheless):

 

“In the first place, the clients of the insurance companies are not homogeneous, and consequently the market for defense is far more ‘lumpy’ than assumed in standard economic models… In reality, large firms would provide the bulk of revenue for the insurance industry. The policies taken out on apartment complexes, shopping malls, manufacturing plants, banks, and skyscrapers would dwarf those taken out by individuals.” (Chaos Theory, 43)

 

24) If large entities were to provide far more money to insurance firms than private individuals, would not the incentive to protect said individuals (who require protection the most, given the lack of resources and economies of scale to coordinate it themselves) on the part of the insurance companies be markedly reduced? If so, how would those individuals attain a sufficient degree of safety against foreign aggression (especially if the insurance policies they do have discourage them from owning too many or too powerful weapons, as Dr. Murphy contended earlier)?

 

25) This is my principal objection to wholly private defense: Does not every individual, regardless of ability to pay, have a natural right to life, liberty, and property, implying that nobody should be able to kill him, enslave him, or deprive him of what little he owns with impunity? Is it not the right of every individual to receive protection against the initiation of force? In the absence of a government with the obligation to provide this protection to everybody, how can this right be honored?

 

Dr. Murphy then presents an example of how the Battle of Stalingrad could have been fought under market anarchy:

 

“Now that we understand the manner in which insurance companies could objectively and quantitatively appraise military success, it is easy to see the advantages of private defense. In a situation comparable to the Battle of Stalingrad, the anarchist community would respond in the most efficient manner humanly possible. Insurance companies would determine the relative value of various military targets, and place bounties on them (for capture or elimination). Individuals left to their own spontaneous devices would try various techniques to produce this ‘service.’ Some might buy tanks and hire men to attack the Germans head-on; others might hire sharpshooters to snipe at them from afar. Some might buy mortars. Some might hire propagandists and offer bribes to lure defectors.” (Chaos Theory, 49)

 

26) This presumes, of course, that all of these individuals would have a compelling self-interest to resist the invaders (especially if they are staunch ideological supporters of free markets, concerned about intrusions upon their liberties). Some individuals are thus principled, and I grant that they would mount such a resistance. But what about men who are not of this sort and choose to join the invader, or insurance companies who see it as more profitable to do so? Rather than forming coordinated resistance from scratch, would it not be easier for these entities to aid the enemy and work out arrangements for either more lenient treatment or even certain perks once the invading government takes over? Under a government resisting an invasion, deserters to the enemy are found guilty of treason and usually executed, a powerful deterrent against assisting the invader. Would a comparable deterrent exist under market anarchy? If so, what form would it take? If not, how would traitors and collaborators with the enemy be punished?

 

Dr. Murphy also comments on certain norms of conduct that would emerge under private defense. On p. 51, he suggests that these norms will lead to “prohibitions on wiretaps and torture,” for example.

 

27) How would prohibitions on wiretaps be enforced, especially if, as Dr. Murphy claims, “counterintelligence would probably be quite limited”? Let us presume that Firm A has developed a sufficiently advanced wiretapping capacity as to be slightly ahead of the competition. If it successfully wiretapped competing firms or foreign governments, it would not be detected. Even if there were a theoretical capacity to detect the espionage, limited counterintelligence tendencies would prevent it from being fully employed. Thus, what barriers would exist to prevent Firm A from just wiretapping everybody with impunity (or conducting other intrusive surveillance)? The case of market anarchy seems remarkably reminiscent of the modern situation, wherein millions of people carry cellular communication devices with built-in cameras and scant guarantees against their ability to take pictures of any stranger they please, anywhere, at any time.

 

Dr. Murphy also claims that the threat to anarchist societies from nearby states would be minimal:

 

“By its very nature, an anarchist society would be a completely harmless neighbor. No State would ever fear attack from an anarchist military, and so there would be no need to preemptively strike it (unlike the Japanese on Pearl Harbor). With no taxation, regulation, tariffs, or immigration quotas, the anarchist society would be of tremendous value to all major governments. They would surely act to protect it from intimidation by a rival nuclear power.” (Chaos Theory, 53)

 

28) If the very existence of a successful anarchist society repudiates by example the necessity of a State, as anarchists would need to claim for their model to be valid, would not states, on the contrary, be extremely wary of such societies? If governments in power seek to stay in power, would they also not seek to forcefully address such blatant threats to their existence (even though the residents of the free territories might not intentionally be threatening anyone)?

 

29) What would prevent governments from allowing the anarchist society to develop for some time, until it amassed vast prosperity, and then, under the modus operandi of so many historical parasites, threatening the anarchist society or attempting to invade it and annex its territory, so as to receive a temporary boost to the invaders’ consumption of the goods that the anarchist society had produced?

 

30) Dr. Murphy’s argument places him in a double bind. Either a) the anarchist society is completely unwilling to undertake pre-emptive strikes and is thus vulnerable to dictators developing their aggressive capacities to the point where successful invasion of the anarchist society is possible or b) the anarchist society is willing to engage in pre-emptive strikes against states its citizens view as a threat, in which case said states would not have the sort of friendly relations with the anarchist society that Dr. Murphy describes, and would rather have incentives to oppose such a society or at least to always be on their guard. In either case, a conspicuous military threat to the existence of the anarchist society would exist.  

 

There are further issues that Dr. Murphy’s general thesis causes to arise:

 

31) What if a given insurance company (especially a large, international one) has two bodies of clients that decide to go to war against each other? How would the insurance company resolve the conflict? What standards would be used to determine liability and which party gets assistance? Would not denying the other party (presumably the one held liable for the violence) assistance be a violation of contract (presuming that the original contract specified that the insurance company would grant any of its clients assistance in the event of war)?

 

32) War itself is a breakdown of the market and of the trader principle. The free market is based on the premise of the non-initiation of force and voluntary consent of all individuals in the disposal of their lives and property. In war, initiation of force on one or both sides is inherently present. How can a free market, then, suffice to address a situation inherently outside its own basic premise?  

 

33) As an extension to #32, a minarchist would claim that the government ought to allow the free market to provide all goods whose acquisition is entirely consensual. However, the use of force, be it in initiation or in retaliation, is not consensual by definition, from the perspective of at least one of the parties involved. While in the market for all other goods, each individual gets to “vote” with his dollar as to how the market will get to benefit him, while acting to the detriment of nobody else, on the market for force-based goods and services, each dollar an individual “votes” with is a “vote” against somebody else, whether that person be deserving of such a “vote” or not.  Should not such “votes” be cast only by agencies that take just desert, as established by objective criteria of Reason, into utmost consideration?

 

It cannot be too frequently expressed that I fully concur with Dr. Murphy in the vast portion of his analysis concerning the deficiencies of every government system up to our time. I also fully concur with his desire for a radical alteration of the political status quo, and a radical reduction in the role of government in individuals’ lives. However, I am far from certain that an altogether elimination of government will be wholly devoid of problems, especially since it easily permits the collective to be substituted for the objective. As a means of maintaining objectivity in law and defense, I have suggested tempering and balancing the branches of government dependent on the rule of the majority with those wholly independent from majoritarian paradigms and interests. In “The Fundamentals of Laissez-Faire Meritocracy” and “Post-Veto Authority” I have proposed a model of government dramatically differing from anything in existence up to this day, wherein non-majoritarian branches of government would not have the power to promulgate positive laws, but would be able to undo the damage perpetrated by intrusive majority-approved legislation via the use of unconditional and non-expiring authority to repeal interventionist laws. In further treatises, I plan to expand on my proposal for an “investmentocracy,” which structures political votes in a government much like shares of a corporation and avoids the pitfalls of majority rule associated with the “one man, one vote” premise. There are numerous clear advantages to the involvement of private agencies in providing law and defense, which is the reason why Dr. Murphy’s theory is credible, scholarly work, far more formidable than current “mainstream” political thought. The task for future political theorists, however, is to address the concerns about Dr. Murphy’s system that I have raised while maintaining its evident advantages.

—(04/05/05)