Santa Clara Law Santa Clara Law Digital Commons Legal Monographs and Treatises Law Library Collections 4-19-1989 The aM chinery of Freedom: Guide to a Radical Capitalism David D. Friedman Santa Clara University School of Law, [email protected] Follow this and additional works at: http://digitalcommons.law.scu.edu/monographs Automated Citation Friedman, David D., "The aM chinery of Freedom: Guide to a Radical Capitalism" (1989). Legal Monographs and Treatises. Book 2. http://digitalcommons.law.scu.edu/monographs/2 This Book is brought to you for free and open access by the Law Library Collections at Santa Clara Law Digital Commons. It has been accepted for inclusion in Legal Monographs and Treatises by an authorized administrator of Santa Clara Law Digital Commons. For more information, please contact [email protected]. The Machinery of Freedom THE MACHINERY OF FREEDOM GUIDE TO A RADICAL CAPITALISM second edition David Friedman This book is dedicated to Milton Friedman Friedrich Hayek Robert A. Heinlein, from whom I learned and to Robert M. Schuchman, who might have written it better Capitalism is the best. It's free enterprise. Barter. Gimbels, if I get really rank with the clerk, 'Well I don't like this', how I can resolve it? If it really gets ridiculous, I go, 'Frig it, man, I walk.' What can this guy do at Gimbels, even if he was the president of Gimbels? He can always reject me from that store, but I can always go to Macy's. He can't really hurt me. Communism is like one big phone company. Government control, man. And if I get too rank with that phone company, where can I go? I'll end up like a schmuck with a dixie cup on a thread. LENNY BRUCE Why can't you see? We just want to be free To have our homes and families And live our lives as we please. DANA ROHRABACHER WEST COAST LIBERTARIAN TROUBADOUR CONTENTS file:///C|/...and%20Settings/Rafael/Meus%20documentos/Downloads/Friedman,%20David%20-%20The%20Machinery%20of%20Freedom.html[14/3/2009 16:59:08] The Machinery of Freedom PART I: IN DEFENSE OF PROPERTY IN DEFENSE OF PROPERTY A NECESSARY DIGRESSION LOVE IS NOT ENOUGH ROBIN HOOD SELLS OUT THE RICH GET RICHER AND THE POOR GET RICHER MONOPOLY I: HOW TO LOSE YOUR SHIRT MONOPOLY II: STATE MONOPOLY FOR FUN AND PROFIT EXPLOITATION AND INTEREST I DON'T NEED NOTHING PART II: LIBERTARIAN GRAB BAG OR HOW TO SELL THE STATE IN SMALL PIECES SELL THE SCHOOLS A RADICAL CRITIQUE OF AMERICAN UNIVERSITIES THE IMPOSSIBILITY OF A UNIVERSITY ADAM SMITH U. OPEN THE GATES SELL THE STREETS 99 AND 44/100THS PERCENT BUILT A FIRST STEP COUNTERATTACK MIGHT HAVE BEEN IS WILLIAM F. BUCKLEY A CONTAGIOUS DISEASE? IT'S MY LIFE THE RIGHTS OF YOUTH CREEPING CAPITALISM IF YOU WANT IT, BUY IT SCARCE MEANS FINITE POLLUTION BUCKSHOT FOR A SOCIALIST FRIEND PART III: ANARCHY IS NOT CHAOS WHAT IS ANARCHY? WHAT IS GOVERNMENT? POLICE, COURTS, AND LAWS—ON THE MARKET THE STABILITY PROBLEM IS ANARCHO-CAPITALISM LIBERTARIAN? AND, AS A FREE BONUS SOCIALISM, LIMITED GOVERNMENT, ANARCHY, AND BIKINIS NATIONAL DEFENSE: THE HARD PROBLEM IN WHICH PREDICTION IS REDUCED TO SPECULATION WHY ANARCHY? REVOLUTION IS THE HELL OF IT THE ECONOMICS OF THEFT, OR THE NONEXISTENCE OF THE RULING CLASS THE RIGHT SIDE OF THE PUBLIC GOOD TRAP HOW TO GET THERE FROM HERE PART IV: FOR LIBERTARIANS:AN EXPANDED POSTSCRIPT PROBLEMS WHERE I STAND ANSWERS: THE ECONOMIC ANALYSIS OF LAW PRIVATE LAW ENFORCEMENT, MEDIEVAL ICELAND, AND LIBERTARIANISM IS THERE A LIBERTARIAN FOREIGN POLICY? THE MARKET FOR MONEY ANARCHIST POLITICS: CONCERNING THE LIBERTARIAN PARTY file:///C|/...and%20Settings/Rafael/Meus%20documentos/Downloads/Friedman,%20David%20-%20The%20Machinery%20of%20Freedom.html[14/3/2009 16:59:08] The Machinery of Freedom G. K. CHESTERTON—AN AUTHOR REVIEW PREFACE TO THE SECOND EDITION Most of this book was written between 1967 and 1973, when the first edition was published. I have made only minor changes to the existing material, in the belief that the issues and arguments have not changed substantially over the past 15 years. In some cases the reader will find the examples dated; Chapter 17, for example, was written when Ronald Reagan was governor of California. Where this seemed to be a serious problem I have updated examples or added explanatory comments, but in most places I have left the original text unaltered. Most current examples will not remain current very long; hopefully this book will outlast the present governor of California as well. I have followed the same policy with regard to numbers. Figures for the number of heroin addicts in New York or U.S. Steel's share of the steel industry describe the situation as of about 1970, when the first edition was being written. When looking at such numbers, you should remember that prices and nominal incomes were about a third as high in 1970 as in 1988, when this preface is being written. Numbers that are purely hypothetical ("If a working wife can hire an Indian maid, who earned_______dollars a year in India . "), on the other hand, have been updated to make them more plausible to a modern reader. The appendices have also been updated, mostly by my friend Jeff Hummel. These are all minor changes. The major difference between this edition and the first is the inclusion of eight new chapters, making up Part IV of the book. One thing I should perhaps have explained in my original preface, and which has puzzled some readers since, is the apparent inconsistency among the chapters. In Chapter 10, for instance, I advocate a voucher system, in which tax monies are used to subsidize schooling, but in Part III I argue for a society with no taxes, no government, and therefore no vouchers. Part II of the book is intended to suggest specific reforms, within the structure of our present institutions, that would produce desirable results while moving us closer to a libertarian society. A voucher system, which moves us from schooling paid for and produced by government to schooling paid for by government but produced on a competitive market, is one such reform. In Part III I try to describe what a full-fledged anarcho-capitalist society might look like and how it would work. Part III describes a much more radical change from our present institutions than Part II while Part II describes how the first steps of that radical change might come about. One reason for writing a book like this is to avoid having to explain the same set of ideas a hundred times to a hundred different people. One of the associated rewards is discovering, years later, people who have incorporated my ideas into their own intellectual framework. This second edition is dedicated to one such person. I cannot honestly describe him as a follower or a disciple, since most of our public encounters have been debates; I believe that his best-known views are wrong and possibly dangerous. He is merely someone who starts out already knowing and understanding everything I had to say on the subjects of this book as of 1973, which makes the ensuing argument very much more interesting. For which reason this second edition is dedicated to Jeffrey Rogers Hummel. PREFACE TO THE FIRST EDITION file:///C|/...and%20Settings/Rafael/Meus%20documentos/Downloads/Friedman,%20David%20-%20The%20Machinery%20of%20Freedom.html[14/3/2009 16:59:08] The Machinery of Freedom My political views seem natural and obvious—to me. Others find them peculiar. Their peculiarity consists largely of carrying certain statements, familiar enough in political oratory, to their natural conclusions. I believe, as many say they believe, that everyone has the right to run his own life—to go to hell in his own fashion. I conclude, as do many on the left, that all censorship should be done away with. Also that all laws against drugs— marijuana, heroin, or Dr. Quack's cancer cure—should be repealed. Also laws requiring cars to have seat belts. The right to control my life does not mean the right to have anything I want free; I can do that only by making someone else pay for what I get. Like any good right winger, I oppose welfare programs that support the poor with money taken by force from the taxpayers. I also oppose tariffs, subsidies, loan guarantees, urban renewal, agricultural price supports—in short, all of the much more numerous programs that support the not-poor—often the rich—with money taken by force from the taxpayers— often the poor. I am an Adam Smith liberal, or, in contemporary American terminology, a Goldwater conservative. Only I carry my devotion to laissez faire further than Goldwater does—how far will become clear in the following chapters. Sometimes I call myself a Goldwater anarchist. These peculiar views of mine are not peculiar to me. If they were, I would be paying Harper and Row to publish this book, instead of Harper and Row paying me. My views are typical of the ideas of a small but growing group of people, a 'movement' that has begun to attract the attention of the national media. We call ourselves libertarians. This book is concerned with libertarian ideas, not with a history of the libertarian 'movement' or a description of its present condition. It is fashionable to measure the importance of ideas by the number and violence of their adherents. That is a fashion I shall not follow. If, when you finish this book, you have come to share many of my views, you will know the most important thing about the number of libertarians—that it is larger by one than when you started reading.