Busting Myths about the State and the Libertarian Alternative Second Edition Zack Rofer Published 2018 by the Mises Institute. This work is licensed under a Creative Commons Attribution-NonCommercial-NoDerivs 4.0 Interna- tional License. http://creativecommons.org/licenses/by-nc-nd/4.0/ Mises Institute 518 West Magnolia Ave. Auburn, Ala. 36832 mises.org ISBN: 978-1-61016-696-6 ISBN (ebook): 978-1-61016-697-3 Typeset by Mike Dworski Contents Preface 1 I. The Statist’s View 5 People ............................ 5 Economics .......................... 7 II. Myths about the Nature of the State 11 Myth #1: The State Is Good and Does Good . 11 Myth #2: The State Acts by Consent . 18 Myth #3: The State Acts for the “Common Good” . 24 Myth #4: The State and Its Personnel Deserve Our Support . 27 Myth #5: Democracy Is Good, Better, Best . 35 Myth #6: The State Dispenses Criminal Justice . 46 III. The Free Market 57 What Is the “Free Market”? . 57 Economics 101 ........................ 59 Austrian Economics ..................... 65 Myth #7: The Free Market Creates an Inequality Problem . 67 Myth #8: The Free Market Exploits Workers . 78 IV. Myths Justifying the Need for the State 89 Acquiescence to the State ................... 89 Myth #9: The State Is an Improvement on the Free Market . 94 Myth #10: We Need the State to Provide “Public Goods” . 106 Myth #11: WeNeed the State to Deal with Negative Externalities121 Myth #12: We Need the State to Deal with Anti-Competitive Behavior . 138 Myth #13: The “Hobbesian Fear” . 141 iii iv Busting Myths V. Busting the Myths about Libertarianism 147 What Is Libertarianism? . 147 Myth #14: Libertarians Are Utopian! . 154 Myth #15: It’s Every Man for Himself! . 158 Myth #16: Libertarianism = Chaos! . 161 Myth #17: We’d Be Defenseless! . 168 Myth #18: There Goes the Environment! . 174 Myth #19: Somalia Disproves the Case for Libertarianism! . 179 Myth #20: Libertarians Are Shills for the Powerful! . 181 Myth #21: Libertarians Don’t Care about the Poor! . 183 Myth #22: Libertarians Are Pro-Prostitution and Pro-Narcotics!190 Myth #23: If It’s so Good, Then Why Hasn’t It Ever Been Tried?191 Myth #24: Libertarianism Is a Futile Endeavor! . 196 VI. Why Does It Matter? 209 Minimizing Conflict within Society . 209 Opposing War . 210 Governing by Principle, Not Arbitrarily . 211 VII. Conclusion 215 Afterword: A Personal Perspective 217 Reading Guide 219 Preface In non-technical terms, the libertarian is simply someone who is against the use of force against peaceful people in civil society. You would think that this would be a universally accepted idea but, as will be discussed in greater depth, to believe in government as we know it is to be at odds with this idea. The vast majority of people in the world today live under some form of publicly organized government, which hereinafter I’ll call the “state.”1 Most people believe that we should live under state rule, whether they are classical liberals, communists, conservatives, fascists, liberals, Marxists, neoconservatives, Progressives, Randians, socialists, or any other flavor, all of whom hereinafter I’ll call “statists.” They simply differ in their views on what powers the state should possess. Nevertheless, statists of all flavors often react quite strongly to the sug- gestion by libertarians that a society without a state, operating on a purely free-market, voluntary basis, would be a more just and efficacious soci- ety. I believe that this reaction results from three categories of errors by statists: first, they don’t fully comprehend the nature of the state; second, they don’t fully comprehend the nature of the free market; and third, they subscribe to certain myths about libertarianism and how a stateless society might work. That they make these errors is not surprising, since for the most part their education has been in institutions where no one asks the question “What is the true nature of and justification for the state?”, and 1All references to the “state” in this book include all arms of the state: the legislature, executive, judiciary, bureaucracy, agencies, etc. While they each have different func- tions, substantively they are all funded in the same manner, they all have the same in- herent characteristics, and they are all responsible for appointing one another and/or working together. The differences between these different arms of the state are trivial compared with the differences between how the state acts and how private citizens act, which is one of the key points of this book. 1 2 Busting Myths there is very little discussion about problems with and alternatives to the state. Given these defects in statists’ understanding of this area of political phi- losophy, what I propose to do in this book is expose some common myths about both the state and libertarianism. Hopefully this will facilitate a more critical view of the state and more openness to the ideas of libertari- anism. Before going further, it’s important to note that, in discussing how so- ciety should be organized and how individuals should interact with one another, there is a distinction between using “utilitarian” principles and “moral” principles. Utilitarianism is concerned with discerning what the correct decision should be based on what would “maximize utility” for “society.” To pur- sue this line of thinking, one has to accept that any particular human who is charged with making a specific societal decision is able to (a) appreciate all of the benefits and costs of each alternative course of action toeachof the individuals who compose society, (b) quantify each of these benefits and costs in terms of common units of utility, and then (c) dispassionately choose the course of action that will maximize society’s utility. On the other hand, morality is concerned with discerning what the cor- rect decision should be based on a standard of good behavior.2 A “stan- dard” means something that is universal, i.e., applies to every man. To pursue this line of thinking, one first has to conclude that there should be a universal behavioral rule. On this point, if we recognize that all men are metaphysically equal, in the sense of possessing the same fundamental ca- pacity for consciousness, conceiving, rationalizing, and acting, then there is no objective justification to define different rules of acceptable, inter- personal behavior for different men. Every man should be expected to treat others, and be entitled to be treated by others, according to the same code. In addition, this line of thinking also requires one to be able to de- fine an acceptable behavioral rule that, as a purely technical matter, could apply to everyone without exception, consistently and continuously (I will develop this further later). 2In this book, when I talk about “moral acts” and “morality,” I am referring only to an evaluation of inter-personal behavior, and not to the evaluation of any actions only involving oneself, which might be better described as “virtues” and “vices.” Preface 3 As will become evident in this book, a number of the common argu- ments raised by statists are utilitarian, as opposed to moral. While I believe that the fundamental strength of libertarianism is its underlying moral- ity—because it is based on a technically feasible, universal standard of ac- ceptable behavior—and the fundamental weakness of statism is its under- lying immorality—because it is inconsistent with the notion of a universal standard of acceptable behavior—even on a utilitarian basis I believe that libertarianism has much more to offer than statism. In any event, Iwill address the relevant statist arguments from both the moral and utilitarian perspectives (for the latter, chiefly through the medium of economic analy- sis), even though I believe that the moral argument should suffice.3 Finally, there are some upfront, stylistic points that I should make. First, since in this book I am contrasting those who support the no- tion of a state with those who don’t, I will be using “libertarian” to mean only someone who argues for a completely stateless society (as I do), also known as an “anarcho-capitalist,” “voluntarist,” “libertarian anarchist,” or “Rothbardian.”4 There are many people who would not argue for a state- less society but who nevertheless label themselves, or get labeled by others, as “libertarian.” I am not referring to them in any way; in this book, they would be “statists.” Second, I appreciate that not all statists think alike; while those on the left, in the middle, and on the right are similarly weak on many issues, they are also differently weak on other issues. Accordingly, when I refer to the assumptions, beliefs, and arguments of statists, I always mean “some” statists, even though I will not always bother using the word “some.” One purpose of this book is to lay out the precepts of statist thinking, not the thoughts of every, or any particular, statist. Third, I have avoided citing too many specific sources in an effort to try 3I still believe that there is a role for utilitarian analysis, but not the one that is usually cited. If economists believe that a particular outcome would lead to greater benefits (however defined) than the outcome that would result from individuals acting based on their own preferences, then these economists should publicize their analysis and use it to try to persuade individuals to change their decision-making processes. The real problem with utilitarian analysis is that it is used by statists to justify forcing in- dividuals to make different decisions, instead of merely trying to persuade them. 4The last term refers to Murray Rothbard, who was the libertarian historian, economist, and philosopher who really ignited modern libertarianism in the 20th century.