Monopoly as the Linchpin to the Libertarian Case

To the minarchists:

• How can the state say it protects property, when it must violate property to exist?

Conza88:

To the minarchists:

• How can the state say it protects property, when it must violate property to exist?

yeah, boy.

i reckon that is the best argument that we have. i used to use the nap to try to convince people, but i don't think it is useful, and i dont think it can be proven, AND i dont think i could uphold it at all times. the best argument is to ask the person if monopolies are good and proceed from there to destroy their beliefs.

This may be rhetorical, or possibly unanswerable, but my curiosity lies in why people choose to allow government to have these monopolies over them. I have asked myself:

Is it because people don't know any better?  I believe this is part of the reason.  Public education ingrains youth with certain beliefs: chief among them that goverment is necessary, or else we'd live in some lawless society "like the Wild West"--which, in itself, is a mis-education.

Is it because of the tyranny of the majority?  Possibly.  The government of the United States of America has 'evolved', for lack of a better word, over time.  Except that I believe that the correct term should be 'devolved'.  I believe that American society has become factious, just as was warned by the country's Founders.  Special interests rule the day, and they support those legislators who will perpetuate their own privilege.

Another question I have asked: Does anyone notice that there really is no large difference between the two parties of the United States?  While there are some basic ideological differences between the Republicans and Democrats, they both offer socialist leanings; one communist/collectivist and the other corporatist.  What I find dangerous to any true Libertarian movement is the Republican Party's adoption--and twisting--of Libertarian ideology to win over voters. (I.e.: the Tea Party's on April 15th, the sudden flurry of quoting Austrian economists and Libertarian authors, etc.)

I don't know... maybe I'm rambling... and I feel like my post is incomplete somehow, but I do realize that something is wrong with a society (or is culture the better word?) that seems like it would rather rely on a government to take care of it, instead of actually working to better itself.

I like the monopoly argument.  I think I'll use that in future debates with people who seem to think that the State should provide for everyone, and at the same time ignore Gerald Ford's warning: "A government big enough to give you everything you want is a government big enough to take from you everything you have."

ricarpe:

This may be rhetorical, or possibly unanswerable, but my curiosity lies in why people choose to allow government to have these monopolies over them. I have asked myself:

It is because they want to have a monopoly over others than themselves, and if the state collapses that becomes impossible.

tacoface:

yeah, boy.

i reckon that is the best argument that we have. i used to use the nap to try to convince people, but i don't think it is useful, and i dont think it can be proven, AND i dont think i could uphold it at all times. the best argument is to ask the person if monopolies are good and proceed from there to destroy their beliefs.

I can sit there all day repeating the same question and never get an answer...

Stranger:

ricarpe:

This may be rhetorical, or possibly unanswerable, but my curiosity lies in why people choose to allow government to have these monopolies over them. I have asked myself:

It is because they want to have a monopoly over others than themselves, and if the state collapses that becomes impossible.

Do you mean that you believe that people feel that the monopoly that the government exerts over everyone is an extension of of a desire that people have to want power over others? If so, then wouldn't this manifest itself in any society, regardless of political organization or lack thereof, by those individuals who want power over others?

After thinking about your response, and playing out the ideas in my head, then would this endanger a libertarian society?  How would such a society guard itself against an individual, or more importantly (and possibly, more dangerously) a group of individuals who put effort in order to attain such a position?

I understand that one could stop cooperating with an individual. (I.e.: cease to trade or otherwise interact with an individual actor/agent.)  But, how would a societal group--for the sake of argument, let's say a village although I know that the question and the answer would apply to a group of any size--resolve to free themselves from this group?  As an American who truly believes in the virtues of individual freedom, I know that I have options as an individual.  It seems to me, however, that my actions would not change much of the group psyche.  In fact, the majority would probably be ignorant of any efforts that I make unless I publicized myself.  In doing so, I would come under the same ridicule that others have suffered from the popular media--which should be a tool for freedom, but is instead a tool used by those who would exert power over us, but I digress...

Note: I'm not asking to bait you into an argument, nor am I being flippant.  I'm trying to understand your response better. I await your reply.

ricarpe:

Stranger:

ricarpe:

This may be rhetorical, or possibly unanswerable, but my curiosity lies in why people choose to allow government to have these monopolies over them. I have asked myself:

It is because they want to have a monopoly over others than themselves, and if the state collapses that becomes impossible.

Do you mean that you believe that people feel that the monopoly that the government exerts over everyone is an extension of of a desire that people have to want power over others? If so, then wouldn't this manifest itself in any society, regardless of political organization or lack thereof, by those individuals who want power over others?

After thinking about your response, and playing out the ideas in my head, then would this endanger a libertarian society?  How would such a society guard itself against an individual, or more importantly (and possibly, more dangerously) a group of individuals who put effort in order to attain such a position?

Interesting train of thought.

The mechanism is in action now in which the powers of some are suppressing the opinions of others.  Who is shaping these opinions and lecturing in powerful positions in which they are supposedly privy to inside information while a farmer is milking a cow?  The politician shapes situations as being important and dire (terrorism, tumbleweeds in the street if economy collapses).  They tap into base appetites (fear, anger, cravings) of the individual in the cities and countryside.  If any individual is not intellectually sturdy or intuitively willing these base appetites well up in people and particular individuals basically lose their minds, their focus, and without strong rational principles an individual has nothing to compare their propaganda up against.  So to get the job done it's simple - go vote.  Check off on a little piece of paper every four or two years and all your fears will disappear for the politician promises to take care of everything.  Sad.

imo  

 

Jacob Bloom:

I'm not trying to be a goddamn scholar.  I'm not interested in theory and academics, I'm interested in practicable solutions to real problems, not a bunch of theorizing.

Then why are you interested in political economy (an analytical subject)? How can you understand the problems, let alone promote solutions, if you do not investigate history, economic theory, political philosophy? As Long writes:

For Rothbard, as for his mentor Ludwig von Mises, one could not hope to understand current political problems without a grasp of history, one could not understand history without knowing economic theory, one could not understand economic theory without investigating such philosophical matters as epistemological apriorism and the nature of agency, and so on.

If you were a social planner, you would be the most dangerous person in the world: powerful, with a burning desire to reconstruct society, and willfully ignorant of social science. And we've seen one before.

Jacob Bloom:

Alright fine.  I'm over Austrian economics, this stuff is rubbish.

Some choice quotes from Edmund Burke, "Vindication of Natural Society":

"Reasons are like Liquors, and there are some of such a Nature as none but strong Heads can bear."

"Whoever is a genuine Follower of Truth, keeps his Eye steady upon his Guide, indifferent whither he is led, provided that she is the Leader."

 

@ Sage

I've got one for you. The existence of a state demonstrates that it is possible for free market conditions to lead to monopoly conditions. Since free competition is economically efficient and monopoly is economically inefficient, doesn't the emergence of a state prove that there are market failures after all?

 

Stephen Forde:

@ Sage

I've got one for you. The existence of a state demonstrates that it is possible for free market conditions to lead to monopoly conditions. Since free competition is economically efficient and monopoly is economically inefficient, doesn't the emergence of a state prove that there are market failures after all?

 

 In Sage's defense if people's use guns or clubs to overcome market order that is not a market failure.

Nerditarian:

 In Sage's defense if people's use guns or clubs to overcome market order that is not a market failure.

The question was for Sage. Actually, I'd be interested in AJ's replie as well. Based on posts they've written, they are qualified to answer the question imo. I I don't think you've read enough relevant literature, or thought enough about the topic to have a clear grasp of the context of the question.

Yes, it is a market failure when market institutions lead to economically inefficient outcomes.

The problem with the OP is that it hinges on a particular use of "monopoly" that is primarily adopted my Austrians and libertarians. You can assume a monopoly in every market and as long as we're using the word "monopoly" in the mainstream neoclassical sense of the word, the market would still be superior to government because there would be exchange in the markets for capital goods and original factors, and as such monetary calculation under the division of labour would be possible.

Monetary calculation is what makes the free market superior, and since it is coercion that circumvents the market system, it is not difficult to conceive of a society in which monetary calculation is not a viable option as a result of "private" coercion, as opposed to state ownership of means of productions ("public" coercion). Look at Somalia, it's essentially stateless, and yet, even countries with large states are doing better in terms of economics (and I don't think it's entirely attributable to previously accumulated capital goods.)

@Stephen Forde,

I think the answer to your problem is that the state is by definition an extramarket institution, whereas the notion of market failure depends on the notion that problems will occur as a result of individuals conducting private, voluntary transactions with one another.

AJ:

Occam's Razor provides that the simplest solution to a problem should be adopted unless there is compelling reason for additional complexity.

This is a common misunderstanding.

http://en.wikipedia.org/wiki/Occam%27s_razor

"Occam's razor, also Ockham's razor,^[1] is the principle that "entities should not be multiplied unnecessarily." It is apocryphally attributed to 14th-century English logician and Franciscan friar, William of Ockham. The principle states that the explanation of any phenomenon should make as few assumptions as possible, eliminating those that make no difference in the observable predictions of the explanatory hypothesis or theory..."

Stephen Forde:

The existence of a state demonstrates that it is possible for free market conditions to lead to monopoly conditions. Since free competition is economically efficient and monopoly is economically inefficient, doesn't the emergence of a state prove that there are market failures after all?

I think you're equivocating between two definitions of market failure: the traditional definition (1) where market production is not optimally efficient; and (2) where market production is abolished and is replaced by communism. (Using Rothbard's definition of market as "a society based purely on voluntary action, entirely un­hampered by violence or threats of violence.")

The anarchist position is that (1) is false. Your worry seems to be about (2). If so, then this isn't about market failure in the traditional sense, because the market is not allowed to work; it is abolished. As Giles pointed out, the State is an extramarket institution.

I'm not sure about the anarchist position on (2). I guess I could say, yes, there are "market failures" in the (2) sense, because this is the realm of extramarket institutions, i.e. aggressive violence, ideology, etc. It's certainly possible that a State could take over an anarchist society. But we have to remember that what's relevant is the comparative analysis between anarchy and government; this just means the score is ten billion to one.

Also, this reminds me of this thread where someone brought up the "if private security is so great, then why don't we have it?" objection.

this whole thing rests on the idea that people need logical justifications for their beliefs. they do not. people don't defend the state just because it seems okay. they defend it because to do otherwise throws all their other beliefs into doubt. since the ego is tied up in belief when you threaten beliefs you are threatening a person directly. the root cause is psychological bias. when you root that out sicknesses like nationalism, religion, and vague thought in general just sort of naturally falls away. for example the person who thinks of the state as mommy must be cured not of statism but of maternalism in general. the person who sees the state as the valient defender must be cured of the need to be defended. when you instill people with independence they naturally come to resent the state. But there is a class of people whom this will not work on. the perennial underclass who does not or can not produce will never be in a position to not take handouts. this class will grow as large as society lets it. In a democracy this class is especially dangerous, once they have the vote the apparatus of the state will be turned entirely to servicing leeches. Then begins the road to serfdom, not a serfdom of the underclass. a serfdom of the producers.

GS:

I think the answer to your problem is that the state is by definition an extramarket institution, whereas the notion of market failure depends on the notion that problems will occur as a result of individuals conducting private, voluntary transactions with one another.

Sage:

I think you're equivocating between two definitions of market failure: the traditional definition (1) where market production is not optimally efficient; and (2) where market production is abolished and is replaced by communism. (Using Rothbard's definition of market as "a society based purely on voluntary action, entirely un­hampered by violence or threats of violence.")

OK, yes. You guys are right. But now I have some questions for both of you.

Hoppe:

First, every state, that is every monopolistic protection agency, must begin, or can only originate on an extremely small territorial level, such as a village. It is practically inconceivable that a world State, or a protection monopoly encompassing the entire world population could come into existence from scratch.

The second thing we have to notice is that not just anyone can reach even reach a local protection monopoly. Rather, the local protection monopolists are initially members of the natural social elite. That is, they are initially accomplished and acknowledged members of society. They were also, before they reached the position of a monopolist, previously chosen voluntarily as protectors. Only as established and recognized elites, whose authority is essentially voluntary, is it possible for them to make this decisive step toward monopolization and get away with it.

That is to say, every initial local government or state originates in the form of personal or private lordships or of princely rule. No one would entrust just anyone with the maintenance of law, order, and justice, and in particular if this person or agency had a monopoly for this particular task. Instead, people would look for protection obviously from someone known, and known to be a knowledgeable person, and only such a person, a noble or an aristocrat, can possibly attain a monopoly position initially.

 Assuming Hoppe's argument regarding the emergence of the state is correct (it seems very reasonable to me), what would you call it when an extra-market institution emereges from market conditions? And is it inevitable? If not what are necessary conditions and what conditions must be necessarily absent?

GilesStratton:

The problem with the OP is that it hinges on a particular use of "monopoly" that is primarily adopted my Austrians and libertarians.

I don't think that's a big deal, as long as the definition is pointed out and an example is given; especially when it is explained that restricted entry into a market tends to bring about higher prices and lower quality of products as a result of the firm granted the monopoly privilege being insulated from competition. But I see your point. I'm not really sure how I would argue with a neoclassical.

Spideynw:

AJ:

Occam's Razor provides that the simplest solution to a problem should be adopted unless there is compelling reason for additional complexity.

This is a common misunderstanding.

http://en.wikipedia.org/wiki/Occam%27s_razor

"Occam's razor, also Ockham's razor,^[1] is the principle that "entities should not be multiplied unnecessarily." It is apocryphally attributed to 14th-century English logician and Franciscan friar, William of Ockham. The principle states that the explanation of any phenomenon should make as few assumptions as possible, eliminating those that make no difference in the observable predictions of the explanatory hypothesis or theory..."

Read the rest of the article you quoted.

Stephen Forde:

The existence of a state demonstrates that it is possible for free market conditions to lead to monopoly conditions. Since free competition is economically efficient and monopoly is economically inefficient, doesn't the emergence of a state prove that there are market failures after all?

In the first sentence you implicitly define "market" to include security and adjudication (which is fine by me). To be consistent, we should retain this definition for the second sentence. In that case, what can be called "market failure" can include failure in the market for security and/or adjudication. In other words, by that definition "market failure" can include being conquered by barbarians, letting any one PDA get too big, or letting a charismatic individual convince enough people that he deserves to be dictator.

So yes, such failures have happened before, and I do think it is non-trivial to show that such would be unlikely to happen in the present age. The onus is on us to provide convincing evidence of why it would be different this time.

I think what's confusing people is that PDAs, etc. would indeed have the ability to be aggressive and coercive. There's no decreed NAP. The whole idea, as I understand it, is that as long as there are many PDAs they would be motivated to keep each other from getting too big. That's why, again, the whole idea is to prevent monopolies. The NAP is just the principle that we theorize (correctly, I think) would be adopted by most societies as a general fundamental rule of conduct in "common law" or whatever it would be called. [Or from a utility perspective, we theorize that societies that adopt the NAP will be more successful than others, and thereby expand while societies that violate the NAP will tend to die out to the degree that they violate it (as history has shown).]

I think we are sometimes confused by the old statist/religious paradigm of "Thou shalt..." into believing that NAP (or AnCap for that matter) will be somehow decreed, when I think we really mean that it will simply arise organically once the state is out of the way.

GilesStratton:

You can assume a monopoly in every market and as long as we're using the word "monopoly" in the mainstream neoclassical sense of the word, the market would still be superior to government because there would be exchange in the markets for capital goods and original factors, and as such monetary calculation under the division of labour would be possible.

I don't much about general economics, but does the neoclassical definition of "monopoly" not encompass security and adjudication services?

GilesStratton:

Monetary calculation is what makes the free market superior, and since it is coercion that circumvents the market system, it is not difficult to conceive of a society in which monetary calculation is not a viable option as a result of "private" coercion, as opposed to state ownership of means of productions ("public" coercion).

Yes, it is conceivable in theory, even if we do not believe it to be likely. For instance, a PDA could (theoretically) get powerful enough to significantly interfere with economic calculation without yet being a monopoly. Like if there were only three PDAs. Worse still if they turned out to be controlled by the same family or something. However, I submit that this is getting closer to monopoly (of security and adjudication). The idea I've been entertaining is that we really just want to avoid enforced* monopolies, and we would want naturally want to avoid oligopoly for the same reasons. [It might be useful to note that through this perspective the public/private distinction has no meaning unless there exists a monopoly (on security and adjudication).]

*Note that a monopoly PDA would be automatically enforced, since it would have the capacity to enforce its own monopoly

 

Not replying to Giles now but as an aside, it looks like even that most innocent of words, "free market," is also a semantic relic of statism. That is, in the AnCap paradigm, "free market" is an artificial distinction insofar as it excludes the market for security and adjudication services. If it includes security and adjudication, then the market as a whole is only free to the extent that it [especially the security and adjudication sector] is decentralized (meaning as far away from monopoly as possible, within reason).