A Spontaneous Order: The Capitalist Case For A Stateless Society CHASE RACHELS Copyright © 2015 Christopher Chase Rachels All rights reserved. ISBN-13: 978-1512117271 ISBN-10: 1512117277 Cover Photo by DAVID ILIFF. License: CC-BY-SA 3.0 DEDICATION This work is dedicated to my son, Micha Rachels. May he grow up with a free spirit, critical mind, and warm heart. ACKNOWLEDGEMENTS I would like to first and foremost thank my wife, Michelle Ferris, for standing by my side as an active participant in the fight against tyranny. Her loving encouragement and support enabled me to see this project to its end. Stephan Kinsella’s mentorship was likewise invaluable in its relation to the precision and rigor of this book. My editor, Mattheus von Guttenberg, also deserves recognition for his professional assistance in editing this work and verifying the accuracy of its content. I would like to express my gratitude for Will Porter, who was gracious enough to contribute one of his brilliant essays (Chapter 0: Epistemology and Praxeology). I would also like to give thanks to the following people who provided their support in a variety of ways, though bear in mind this list is by no means exhaustive or in any particular order: Luis F. Duran-Aparicio, Blake Williams, Jason Bassler, Josh Hilditch, Chris Calton, Gary Simon, Mike Martelli, Joel Richardson, Walter Block, Jeff Berwick, and many more! CONTENTS Foreword … 6 Introduction … 11 0. Epistemology and Praxeology … 19 1. Libertarianism … 45 2. Property … 66 3. Contract … 78 4. Money and Banking … 90 5. Monopolies and Cartels … 122 6. Insurance … 131 7. Health Care … 139 8. Law and Order … 147 9. Defense and Security … 172 10. Transportation Networks … 185 11. Education … 195 12. Poverty … 211 13. Environmentalism … 234 14. The Corporation … 259 15. Getting There … 278 Resources … 286 Foreword MODERN LIBERTARIAN THEORY is only about five decades old. The ideas that have influenced our greatest thinkers can be traced back centuries, of course,1 to luminaries such as Hugo Grotius, John Locke, Thomas Paine, Herbert Spencer, David Hume, and John Stuart Mill, and to more recent and largely even more radical thinkers such as Gustave de Molinari, Benjamin Tucker, Lysander Spooner, Bertrand de Jouvenel, Franz Oppenheimer, and Albert Jay Nock.2 The beginnings of the modern movement can be detected in the works of the “three furies of libertarianism,” as Brian Doherty calls them: Rose Wilder Lane, Ayn Rand, and Isabel Patterson, whose respective books The Discovery of Freedom, The Fountainhead, and The God of the Machine were all published, rather remarkably, in the same year: 1943.3 But in its more modern form, libertarianism originated in the 1960s and 1970s from thinkers based primarily in the United States, notably Ayn Rand and Murray Rothbard. Other significant influences on the nascent libertarian movement include Ludwig von Mises, author of Liberalism (1927) and Human Action (1949, with a predecessor version published in German in 1940); Nobel laureate F.A. von Hayek, author of The Road to Serfdom (1944); Leonard Read, head of the Foundation for Economic Education (founded 1946); and Nobel laureate Milton Friedman, author of the influential Capitalism and Freedom (1962). The most prominent and influential of modern libertarian figures, however, were the aforementioned novelist-philosopher Ayn Rand, the founder of “Objectivism” and a “radical for capitalism,” and Murray Rothbard, the Mises-influenced libertarian anarcho-capitalist economist and political theorist. Rothbard’s seminal role is widely recognized, even by non- Rothbardians. Objectivist John McCaskey, for example, has observed, that out of the debates in the mid-1900s about what rights citizens ought to have, 1 For more on this, see Brian Doherty, Radicals for Capitalism: A Freewheeling History of the Modern American Libertarian Movement (New York: Public Affairs, 2007) and David Boaz, The Libertarian Reader: Classic and Contemporary Readings from Lao-tzu to Milton Friedman (New York: Free Press, 1997). 2 See Boaz, The Libertarian Reader. 3 See Doherty, Radicals for Capitalism. 7 A SPONTANEOUS ORDER grew the main sort of libertarianism of the last fifty years. It was based on a principle articulated by Murray Rothbard in the 1970s this way: No one may initiate the use or threat of physical violence against the person or property of anyone else. The idea had roots in John Locke, America’s founders, and more immediately Ayn Rand, but it was Rothbard’s formulation that became standard. It became known as the non-aggression principle or—since Rothbard took it as the starting point of political theory and not the conclusion of philosophical justification—the non- aggression axiom. In the late twentieth century, anyone who accepted this principle could call himself, or could find himself called, a libertarian, even if he disagreed with Rothbard’s own insistence that rights are best protected when there is no government at all.4 We can date the dawn of today’s libertarianism to the works of Rand and Rothbard: to Rand’s Atlas Shrugged (1957); and, especially, to Rothbard’s Man, Economy, and State (1962), Power and Market (1970), and For A New Liberty (1973), plus his journal The Libertarian Forum (1969–1984). For A New Liberty stands today as a brilliant, and early, bold statement of the radical libertarian vision. By the mid-60s, the modern libertarian movement was coalescing, primarily behind the non-initiation of force principle and the “radical capitalism” of Ayn Rand, and Rothbard’s systematic libertarian corpus based upon the non-aggression principle or axiom. It is no surprise that the Libertarian Party was founded in 1971, as these ideas, and the liberty movement, were gaining steam. In the ensuing decades many other influential works appeared expounding on the libertarian idea, such as Linda and Morris Tannehill, The Market for Liberty (1970), John Hospers, Libertarianism: A Political Philosophy for Tomorrow (1971), David Friedman, The Machinery of Freedom (1973), Robert Nozick, Anarchy, State, and Utopia (1974), Henri Lepage, Tomorrow, Capitalism (1978), Samuel Edward Konkin III, New Libertarian Manifesto 4 John P. McCaskey, “New Libertarians: New Promoters of a Welfare State” (published as a blog post on johnmccaskey.com, April 14, 2014). http://www.johnmccaskey.com/joomla/index.php/blog/71-new-libertarians. See also, Wendy McElroy, “Murray N. Rothbard: Mr. Libertarian,” (published on LewRockwell.com, July 6, 2000). 8 FOREWORD (1980), Jan Narveson, The Libertarian Idea (1988), Anthony de Jasay, Choice, Contract, Consent: A Restatement of Liberalism (1991), Richard Epstein, Simple Rules for a Complex World (1995), Charles Murray, What It Means to Be a Libertarian: A Personal Interpretation (1996), David Boaz, Libertarianism: A Primer (1998), Randy E. Barnett, The Structure of Liberty (1998), and, more recently, Jeffrey A. Miron’s Libertarianism, From A to Z (2010), Jacob Huebert’s Libertarianism Today (2010), Gary Chartier’s The Conscience of an Anarchist (2011), and Gerard Casey’s Libertarian Anarchism (2012). These and other works expounding on the ideas of liberty have their own strengths and merits, and many of them have their own deficiencies and idiosyncrasies as well. Some, for example, are statements only of the author’s personal vision and do not purport to describe libertarian thought in general; some are minarchist, at best, and do not even recognize anarcho-libertarianism as a type of libertarianism (Miron, for example, says “libertarianism accepts a role for government in a few, limited areas: small government, not anarchy”);5 and some do not sufficiently appreciate Austrian economics and its crucial role in informing political theory. And many of the earlier works are simply dated at this point—how could they not be, being written before the rise of the Internet (1995) or even before the fall of communism (1989–91)? As libertarian thought develops and matures, there is a continual need to restate our basic principles, to search for new ways of understanding and conveying our views about the nature of human society, the state, conflict, cooperation, and liberty. The way forward, if we wish to spread and develop the intellectual edifice of libertarian thought, is to extend and advance the most consistent, scientific, and rigorous foundation for libertarianism. This is, in my view, the basic vision laid out by Rothbard, which relies heavily on free market economic theory, chiefly that of Rothbard’s mentor Mises, and as supplemented by the work of Rothbard’s colleague and protégé Hans-Hermann Hoppe, author of A Theory of Socialism and Capitalism (1989), inter alia. This type of libertarianism is distinct from others in many ways. It is principled and rights-based, not utilitarian (not to say that it is impractical; as Rand pointed out, the practical is the moral);6 it is radical, anarchist, and anti-state, not minarchist; it is anti- war; it is systematic and rigorous, not a collection of ad hoc policy points; it is realistic, sober and sophisticated about the nature of the state; and it is heavily influenced by insights of free market and Austrian economics, especially those of Mises and his “praxeological” understanding of human 5 Jeffrey A. Miron, Libertarianism, from A to Z. (New York: Basic Books, 2010). 6 See Randy E. Barnett, The Structure of Liberty: Justice and the Rule of Law (Oxford: Clarendon, 1998), arguing for a distinction between consequentialism and utilitarianism; also idem, “Foreword: of Chickens and Eggs—The Compatibility of Moral Rights and Consequentialist Analysis,” 3 Harv. J. L. Publc. Pol’y 611 (1989), available at www.randybarnett.com. 9 A SPONTANEOUS ORDER action. Thus, Rothbard, influenced by and building on the insights of earlier and contemporary thinkers, such such as Mises and Rand, first presented a systematic vision of modern, radical libertarianism: anti-state, pro-market, Austrian. This enabled Rothbard to adumbrate a broad framework for liberty, from property to contract to punishment theory.