[Clips] But Wouldn't Warlords Take Over?

[R.A. Hettinga]

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 Subject: But Wouldn't Warlords Take Over?
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 Myth of National Defense, 20% Off (from $25 to $20).

 But Wouldn't Warlords Take Over?

 by Robert Murphy

 <http://www.mises.org/story/1855>[Posted on Thursday, July 07, 2005]

  On two separate occasions in the last couple of weeks, people have asked
 me a familiar question:  In a system of anarcho-capitalism or
 the free-market order, wouldnt society degenerate into constant battles
 between private warlords?  Unfortunately I didnt give adequate answers at
 the times, but I hope in this article to prove the adage that later is
 better than never.

 APPLES AND ORANGES

 When dealing with the warlord objection, we need to keep our comparisons
 fair. It wont do to compare society A, which is filled with evil, ignorant
 savages who live under anarchy, with society B, which is populated by
 enlightened, law-abiding citizens who live under limited government.  The
 anarchist doesnt deny that life might be better in society B.  What the
 anarchist does claim is that, for any given population, the imposition of a
 coercive government will make things worse.  The absence of a State is a
 necessary, but not sufficient, condition to achieve the free society.

 To put the matter differently:  It is not enough to demonstrate that a
 state of private-property anarchy could degenerate into ceaseless war,
 where no single group is strong enough to subjugate all challengers, and
 hence no one can establish order.  After all, communities living under a
 State degenerate into civil war all the time.  We should remember that the
 frequently cited cases of Colombia and now Iraq are not demonstrations of
 anarchy-turned-into-chaos, but rather examples of
 government-turned-into-chaos.

 For the warlord objection to work, the statist would need to argue that a
 given community would remain lawful under a government, but that the same
 community would break down into continuous warfare if all legal and
 military services were privatized.  The popular case of Somalia, therefore,
 helps neither side.<http://www.mises.org/story/1855#_edn1>[i]  It is true
 that Rothbardians should be somewhat disturbed that the respect for
 non-aggression is apparently too rare in Somalia to foster the spontaneous
 emergence of a totally free market community.  But by the same token, the
 respect for the law was also too weak to allow
 <http://en.wikipedia.org/wiki/History_of_Somalia#Somali_Civil_War>the
 original Somali government to maintain order.

 Now that weve focused the issue, I think there are strong reasons to
 suppose that civil war would be much less likely in a region dominated by
 private defense and judicial agencies, rather than by a monopoly State.
 Private agencies own the assets at their disposal, whereas politicians
 (especially in democracies) merely exercise temporary control over the
 States military equipment.  Bill Clinton was perfectly willing to
 <http://news.telegraph.co.uk/htmlContent.jhtml?html=/archive/1998/08/21/wemb21.html>fire
 off dozens of cruise missiles when the Lewinsky scandal was picking up
 steam.  Now regardless of ones beliefs about Clintons motivations,
 clearly Slick Willie would have been less likely to launch such an attack
 if he had been the CEO of a private defense agency that could have sold the
 missiles on the open market for
 <http://www.chinfo.navy.mil/navpalib/factfile/missiles/wep-toma.html>$569,000
 each .<http://www.mises.org/story/1855#_edn2>[ii]

 We can see this principle in the case of the United States.  In the 1860s,
 would large scale combat have broken out on anywhere near the same scale
 if, instead of the two factions controlling hundreds of thousands of
 conscripts, all military commanders had to hire voluntary mercenaries and
 pay them a market wage for their services?

 CONTRACT THEORY OF GOVERNMENT

 I can imagine a reader generally endorsing the above analysis, yet still
 resisting my conclusion.  He or she might say something like this:  In a
 state of nature, people initially have different views of justice.  Under
 market anarchy, different consumers would patronize dozens of defense
 agencies, each of which attempts to use its forces to implement
 incompatible codes of law.  Now its true that these professional gangs
 might generally avoid conflict out of prudence, but the equilibrium would
 still be precarious.

 To avoid this outcome, my critic could elaborate, citizens put aside
 their petty differences and agree to support a single, monopoly agency,
 which then has the power to crush all challengers to its authority.  This
 admittedly raises the new problem of controlling the Leviathan, but at
 least it solves the problem of ceaseless domestic warfare.

 There are several problems with this possible approach.  First, it assumes
 that the danger of private warlords is worse than the threat posed by a
 tyrannical central government.  Second, there is the inconvenient fact that
 no such voluntary formation of a State ever occurred.  Even those citizens
 who, say, supported the ratification of the U.S. Constitution were never
 given the option of living in market anarchy; instead they had to choose
 between government under the Articles of Confederation or government under
 the Constitution.

 But for our purposes, the most interesting problem with this objection is
 that, were it an accurate description, it would be unnecessary for such a
 people to form a government.  If, by hypothesis, the vast majority of
 peoplealthough they have different conceptions of justicecan all agree
 that it is wrong to use violence to settle their honest disputes, then
 market forces would lead to peace among the private police agencies.

 Yes, it is perfectly true that people have vastly different opinions
 concerning particular legal issues.  Some people favor capital punishment,
 some consider abortion to be murder, and there would be no consensus on how
 many guilty people should go free to avoid the false conviction of one
 innocent defendant.  Nonetheless, if the contract theory of government is
 correct, the vast majority of individuals can agree that they should settle
 these issues not through force, but rather through an orderly procedure
 (such as is provided by periodic elections).

 But if this does indeed describe a particular population, why would we
 expect such virtuous people, as consumers, to patronize defense agencies
 that routinely used force against weak opponents?  Why wouldnt the vast
 bulk of reasonable customers patronize defense agencies that had
 interlocking arbitration agreements, and submitted their legitimate
 disputes to reputable, disinterested arbitrators?  Why wouldnt the
 private, voluntary legal framework function as an orderly mechanism to
 settle matters of public policy?

 Again, the above description would not apply to every society in history.
 But by the same token, such warlike people would also fail to maintain the
 rule of law in a limited State.

 FREE RIDERS?

 A sophisticated apologist for the Stateespecially one versed in mainstream
 economicsmight come back with yet another justification:  The reason a
 limited government is necessary is that we cant trust the market to
 adequately fund legitimate police forces.  It may be true that 95 percent
 of a population would have similar enough views with respect to justice
 such that peace would obtain if they all contributed substantially to
 defense agencies dedicated to enforcing their views.

 However, the apologist could continue, if these police agencies have no
 right to extract contributions from everyone who endorses their actions,
 then they will be able to field a much smaller force.  The market fails
 specifically because of the free rider problem:  When a legitimate firm
 cracks down on a rogue agency, all law abiding people benefit, but in a
 free market they would not be obliged to pay for this public good.
 Consequently, rogue agencies, funded by malevolent outlaws, will have a
 much wider scope of operation under anarchy.

 Again, there are several possible replies to such a position.  First, let
 us reflect that a large standing army, ready to crush minority dissenters,
 is not an unambiguously desirable feature of government.

 Second, the alleged problem of free riders would not be nearly as
 disastrous as many economists believe.  For example, insurance companies
 would internalize the externalities to a large degree.  It may be true
 that an inefficient number of serial killers would be apprehended if the
 relevant detective and police agencies had to solicit contributions from
 individual households.  (Sure, everyone gets a slight benefit from knowing
 a serial killer has been caught, but whether or not one person contributes
 probably wont make the difference between capture or escape.)

 Yet insurance companies that each held policies for thousands of people in
 a major city would be willing to contribute hefty amounts to eliminate the
 menace of a serial killer.  (After all, if he kills again, one of these
 companies will have to pay out hundreds of thousands of dollars to the
 estate of the victim.)  The same reasoning demonstrates that the free
 market could adequately fund programs to contain rogue agencies.

 Third, people need to really picture the nightmare scenario to see how
 absurd it is.  Imagine a bustling city, such as New York, that is initially
 a free market paradise.  Is it really plausible that over time rival gangs
 would constantly grow, and eventually terrorize the general
 public?<http://www.mises.org/story/1855#_edn3>[iii]  Remember, these would
 be admittedly criminal organizations; unlike the city government of New
 York, there would be no ideological support for these gangs.

 We must consider that in such an environment, the law-abiding majority
 would have all sorts of mechanisms at their disposal, beyond physical
 confrontation.  Once private judges had ruled against a particular rogue
 agency, the private banks could freeze its assets (up to the amount of
 fines levied by the arbitrators).  In addition, the private utility
 companies could shut down electricity and water to the agencys
 headquarters, in accordance with standard provisions in their contracts.

   <http://www.mises.org/store/Myth-of-National-Defense-The-P171C0.aspx>
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 Of course, it is theoretically possible that a rogue agency could overcome
 these obstacles, either through intimidation or division of the spoils, and
 take over enough banks, power companies, grocery stores, etc. that only
 full-scale military assault would conquer it.  But the point is, from an
 initial position of market anarchy, these would-be rulers would have to
 start from scratch.  In contrast, under even a limited government, the
 machinery of mass subjugation is ready and waiting to be seized.

 CONCLUSION

 The standard objection that anarchy would lead to battling warlords is
 unfounded.  In those communities where such an outcome would occur, the
 addition of a State wouldnt help.  Indeed, the precise opposite is true:
 The voluntary arrangements of a private property society would be far more
 conducive to peace and the rule of law, than the coercive setup of a
 parasitical monopoly government.




 <mailto:robert_p_murphy at yahoo.com>Robert Murphy is an adjunct scholar of
 the Mises Institute. He teaches economics at Hillsdale College. See the
 Murphy <http://www.mises.org/articles.asp?mode=a&author=Murphy>Archive. Buy
 his <http://www.mises.org/store/Chaos-Theory-P190C0.aspx>book on the
 stateless society. Discuss this article on
 the <http://www.mises.org/blog>blog.

 <http://www.mises.org/story/1855#_ednref1>[i] Having made this concession,
 I should point out that
 <http://en.wikipedia.org/wiki/History_of_Somalia#Recent_History>anarcho-capitalists
 can see their theories borne out in Somalia to some extent.

 <http://www.mises.org/story/1855#_ednref2>[ii] Its true that this figure
 would be lower for a private defense firm, since it would control costs
 much better than the Pentagon.  Nonetheless it is still true that a private
 firm would husband its stockpile of weapons better than State officials.

 <http://www.mises.org/story/1855#_ednref3>[iii] Let us also keep in mind
 that currently, mob groups (1) do not extract anywhere near as much money,
 nor kill as many people, as any government in a typical days work, and (2)
 they derive their current strength from government prohibitions (on
 gambling, drugs, prostitution, loan-sharking, etc.) and hence are not
 representative at all of an anarchist world.

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R. A. Hettinga <mailto: rah at ibuc.com>
The Internet Bearer Underwriting Corporation <http://www.ibuc.com/>
44 Farquhar Street, Boston, MA 02131 USA
"... however it may deserve respect for its usefulness and antiquity,
[predicting the end of the world] has not been found agreeable to
experience." -- Edward Gibbon, 'Decline and Fall of the Roman Empire'