Wednesday, July 14, 2021

If free markets work, why do have a state?

Libertarians call for a free society but few bother to define what this means or explain how to achieve it.  For most a free society is one with a limited government.  But how do we keep it limited?  Who gets to define the limitations?  How many people today even want a limited government?  Not many, or libertarianism would be more popular.

The path to this limited government ideal is cleared by unlearning the fallacies government schools have taught us.  But if the unlearning is consistent, the result will be to wipe government as we know it out of the picture altogether.  Not even libertarians want that.  Why else would there be a Libertarian Party?  Someone has to oversee a limited government to make sure it doesn’t meddle unnecessarily in our lives, and libertarians of the Libertarian Party are presumably most fit for the job. 

You don't have a free society when a monopoly of violence exists at its core.  It's the seed of everything that goes wrong.  Libertarians thus are stuck with an inconsistent premise.  The sacred nonaggression principle seemingly must coexist with an agency of aggression, allowing some people powers that are legally forbidden to others.

For many, being without a state would feel like open season on their lives.  And as we've witnessed here in the U.S., a minimalist state tends tends not to stay minimal.  

Suppose, though, that anarchy isn’t the ultimate political horror?  What if “anarchy” serves as cover for a free market and a free society generally?  What is it about the free market that it can provide almost all, but not quite all, of society’s needs?  Is it possible that’s a myth—or worse, a hoax?  

Free markets work

It's believed that the state needs to provide certain functions that are beyond the scope of the free market. Is this true?

Why can’t free men (and women) decide on their own to institute courts and advertise their benefits to the public?  Why can’t others do the same and attempt to persuade the public their courts are better?  And wouldn’t it be possible that some people would prefer the courts of A while others subscribe to the courts of B?  And couldn’t they agree on a binding method of conflict resolution?  

Who among us would feel safe without a means of protecting ourselves from foreign invaders?  Given the likelihood that insurance companies would undertake defense services and have an incentive to minimize claims, wouldn’t they tend to promote peace while having the requisite means of defending their clients from attacks?  

What would happen to the needy under a free market?  Would they be left to perish in a so-called dog-eat-dog world?  Other people, acutely aware of their own vulnerability, have proven to be charitable even in an age when government has grabbed the welfare reins.  In days before the welfare state, charity was the pride of the semi-free society we once had.  

Would income disparity exist under a free market government?  Absolutely, just as disparities exist among people in all areas of life.  But the fortunes made by some would depend largely on their ability to satisfy customers, not on their nonexistent political connections.  Under coercive government Burton Folsom’s political entrepreneurs (the real Robber Barons) thrive at the public’s expense.  


When you hear “anarchy,” think “free market” and remember all the blessings it has brought us — and when you hear “government” consider this observation from Robert Higgs:

Anarchists did not try to carry out genocide against the Armenians in Turkey; they did not deliberately starve millions of Ukrainians; they did not create a system of death camps to kill Jews, gypsies, and Slavs in Europe; they did not fire-bomb scores of large German and Japanese cities and drop nuclear bombs on two of them; they did not carry out a ‘Great Leap Forward’ that killed scores of millions of Chinese; they did not attempt to kill everybody with any appreciable education in Cambodia; they did not launch one aggressive war after another; they did not implement trade sanctions that killed perhaps 500,000 Iraqi children.

In debates between anarchists and statists, the burden of proof clearly should rest on those who place their trust in the state. Anarchy’s mayhem is wholly conjectural; the state’s mayhem is undeniably, factually horrendous.

George Ford Smith is a former mainframe and PC programmer and technology instructor, the author of eight books including a novel about a renegade Fed chairman (Flight of the Barbarous Relic), a filmmaker (Do Not Consent), and an advocate of stateless market government.  He eagerly welcomes speaking engagements and can be reached at

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