Anarcho-capitalism

Anarcho-capitalism is a view which regards all forms of government as unnecessary and harmful, including (or especially) in matters of justice and self-defense. It draws ideas from the tradition of classical liberalism (see libertarianism) and arguably from individualist anarchism as well, but discards certain portions of these traditions.

Anarcho-capitalists promote individual property rights and free markets (in the sense of freedom from violent interference) as the most just and effective way to organize all services. They see the definition of property rights through contracts and common law as a universal mechanism to solve conflicts. They regard capitalist corporations as being the product of voluntary contracts and thus a legitimate and efficient way for people to organize, with freedom to choose a competitor or to enter competition as the universal way to preserve and promote quality in services. This analysis includes all goods and services, including those which governments have traditionally claimed as their natural monopoly — such as police or military forces (though only for defensive purposes) and justice through courts of arbitration.

Thus, anarcho-capitalists characterize their position as a form of anarchism. They reject all forms of state control — including taxation, coercive regulation, war, and coercive monopoly on the use of defensive force — as violations of essential individual rights. (They also reject these forms of coercive control whether they are exercised by state officials or by private agents; they oppose them because they are violations of rights, not because they are committed by governments.)

Anarcho-capitalism has also been called private-property anarchism, free market anarchism, anarcho-liberalism, neo-classical liberalism, and anti-state capitalism. Some consider it to be identical to panarchy, and critics often accuse it of reducing to plutocracy in practice.

Table of contents

1 Philosophical roots 1.1 Classical liberal tradition 1.2 Individualist Anarchist tradition 2 Utilitarian vs. Natural Law Approaches 3 Anarcho-Capitalism, Corporations, and Contracts 4 Anarcho-capitalism and violence 5 Arguments for and against Anarcho-Capitalism 5.3 Defense Agencies and Monopoly 6 Crypto-anarchism 7 External links 7.4 Anarcho-Capitalism Websites 7.5 Opposing Views

Philosophical roots

Classical liberal tradition

Classical liberalism is one of the primary sources of anarcho-capitalist thought, and many anarcho-capitalists think of themselves more as an anarchist flavor of classical liberalism than a capitalist flavor of anarchism. Many consider non-anarchist libertarians as friends who make the relatively minor (but nonetheless significant) mistake of accepting some form of government, while regarding anti-capitalist anarchists as dangerous collectivists with whom they have little in common. Other anarcho-capitalists, however, have formed alliances with the Left in the past, and have sought bridge-building with with anti-capitalist anarchists more than with other pro-capitalists. (One of the most prominent examples of the latter tendency was Murray Rothbard and his journal Left and Right during the Vietnam War era; one of the most prominent examples of the former tendency was Murray Rothbard's paleolibertarianism during the 1980s and 1990s.)

As part of classical liberalism, anarcho-capitalism is based on the notions of individual liberty (including private property) and natural law. Libertarian scholars have, since the inception, studied society from the point of view of dynamic emerging orders, which in recent times has been explicitly associated with the economic theory of F. A. Hayek and with the discipline of cybernetics. Their tradition can be traced back to John Locke and the seventeenth century English Levellers, as well as to earlier French and British economists and philosophers; some count Aristotle as an early classical liberal, and some even interpret Lao Zi as an anarchist.

The classical liberal tradition has always been characterized by distrust of the State and calls to limit its power, but it was not until the 19th century that some classical liberals began to make explicit arguments for the abolition of monopoly government. Classical liberals have always argued for as little government as possible; minarchists in the classical liberal tradition have argued that some government was necessary or desirable to protect rights, whereas anarchists have argued that monopoly government can — and should — be abolished completely. Some classical liberal thinkers, such as Ayn Rand, have vehemently opposed anarcho-capitalism. Many (perhaps most) classical liberals today simply do not raise the question of whether government as such is something legitimate or desirable; most have treated the State as something inevitable, in practice if not in principle, for the forseeable future, and hence think of anarcho-capitalism (if they think of it at all) as an irrelevant dream.

The earliest classical liberal thinker who advocated a complete theory of anti-state liberalism is Gustave de Molinari, beginning in 1849. (Before Molinari, some liberal revolutionaries in Britain and America had endorsed anarchy without theorizing it, and some French economists had begun theorizing it without endorsing it.) The anti-state liberal tradition in Europe and the United States continued after Molinari in the early writings of Herbert Spencer, as well as in thinkers such as Paul Emile de Puydt, Auberon Herbert, and Albert Jay Nock.

There is somewhat more controversy concerning the relationship of individualist anarchists such as Max Stirner, Henry David Thoreau, Lysander Spooner, and Benjamin Tucker to the anti-state liberal tradition. Anarcho-capitalists typically claim them as intellectual forbearers; anti-capitalist anarchists often argue against the claim by noting that each of these individuals rejected essential aspects of the modern capitalist marketplace. For example, Spooner rejected wage labor, Tucker argued against usury and described his project as "voluntary socialism," and Stirner argued against the very application of property. Anarcho-capitalists, on the other hand, emphasize the individualists' critique of collectivist politics, and point out that the individualists denounced the use of violence to oppose the economic relationships that they considered exploitative, and emphasized voluntary, free market approaches (such as boycotts, labor strikes, and the formation of workers' cooperatives) to achieving social justice.

The term anarcho-capitalism was first adopted by anti-state liberals during the 1950s, especially under the influence of Murray Rothbard. This new generation of thinkers was heavily influenced by the introduction of Austrian School economics by Ludwig von Mises and other classical liberal thinkers who had fled the rise of National Socialism and now taught in the U.S.A. The fusion of European and American traditions was found especially in Rothbard, who studied under von Mises, and was passed on to many other prominent anarcho-capitalists, including David Friedman, Jan Narveson, Anthony de Jasay, Gary Greenberg, Walter Block and Hans-Herman Hoppe.

Individualist Anarchist tradition

Many anarcho-capitalists also locate themselves within the tradition of individualist anarchism. Like the individualist anarchists, they reject the State and endorse a society based entirely on free association, though they disagree with individualists on exactly what is entailed by free association. Many anarcho-capitalists were also influenced by individualist critiques of the State and their arguments for the right to ignore or withdraw from it (as, for example, in Lysander Spooner's No Treason: The Constitution of No Authority, which was widely reprinted in early anarcho-capitalist journals). Anarcho-capitalists also follow in the individualist anarchist condemnation of all forms of collectivist coercion, though again they disagree in some places on what is constitutes collective coercion.

The relationship between anarcho-capitalist and individualist anarchist economic views is somewhat more complex. Some of the difficulty here may be understood as mainly terminological: anarcho-capitalists typically use the word "capitalism" to mean the free market, i.e., an economic order based entirely on voluntary association, free of violent intervention from the State. Many individualist anarchists, on the other hand, often used "capitalism" to identify a concrete system of specific economic practices prevelant in historical and modern markets. One can be an advocate of capitalism in the first sense without being an advocate of capitalism in the second sense; indeed, some anarcho-capitalists argue that government intervention creates many problems in the "capitalist" marketplace today. On the other hand, there are still substantive differences between many modern anarcho-capitalists and the individualist anarchists on specific arrangements which are pervasive in today's marketplace - modern anarcho-capitalists are often much more inclined than the individualist anarchists were to accept that phenomena such as wage labor, rent, and corporate organization of commerce would arise naturally in a free society, and also more inclined to accept them as morally legitimate.

In any case, both anarcho-capitalists and individualist anarchists agree with the principle that in a free society, everyone should be free to organize themselves into any voluntary economic order that they wish (i.e., in any way that respects particular conceptions of property rights) — whether in capitalist firms, in independent family-run businesses, or in mutualist cooperatives. At the strongest, anarcho-capitalists merely defend capitalism (in the second sense of the term) as a legitimate choice among these forms of organization, and argue the science of economics demonstrates that it is the choice which is the most efficient for a prosperous and vital community — but one which they should not and will not impose on others by force.

Many individualist and collectivist anarchists, on the other hand, criticize the anarcho-capitalist reading of the individualist anarchists, and argue that the individualist rejection of capitalist practices is essential to individualist anarchism. These anarchists typically reject anarcho-capitalist claims to belong to the individualist anarchist tradition as a serious distortion of individualist anarchist thought.

Utilitarian vs. Natural Law Approaches

Libertarians in general, and anarcho-capitalists in particular, have developed two different approaches to their theories, from a utilitarian point of view, or from a point of view of natural law. Some of them defend one approach and dismiss the other, whereas some of them, like Bastiat, claim an inherent harmony or correspondence between the two complementary approaches.

The Natural Law approach (see for instance Murray Rothbard and his book Power and Market) argues that the existence of the state is immoral, and that unlimited capitalism is the only ethical political system, or rather anti-political system. The Utilitarian approach (see for instance David Friedman) argues that abolition of the state in favour of private businesses is economically more efficient. The Harmonic approach argues both as equivalent statements.

The notion of property rights is a fundamental element of anarcho-capitalism. The Natural Law approach argues for the natural right of humans to own their body and the result of their work, that they can use or refuse to use as they like, as long as they do not attempt to use or forcibly transfer the property of someone else. The Utilitarian approach argues that defining property rights in this manner is the most efficient way to prevent destructive conflicts between individuals and to foster productive efforts. Actually, under this approach, ownership of one's body together with the respect of earlier claims naturally entails ownership of the results of one's marginal work, since someone who own's one's own body could withhold work if refused the ownership of its results.

Anarcho-capitalism rejects every and all kinds of "positive right" (such as the "right to be protected by others", the "right to be fed by others", the "right to receive a minimum salary from others"), and defends "negative rights" (such as the "right not to be attacked by anyone else", the "right to not have one's food stolen by anyone else", and the "right not to have any part of one's salary confiscated by anyone"). It differs from minarchist libertarianism only in that it considers that "being protected by others" is also a positive service that must be rejected as a right, and that one can't claim protection by government, but must take personal steps or organize with others, so as to enforce the respect of one's property.

Anarcho-Capitalism, Corporations, and Contracts

While anarcho-capitalists believe that private businesses born out of voluntary contracts are the best (most moral and most efficient) way to conduct human affairs, they do not support corporations as currently are supported by governments. All anarcho-capitalists criticize government-enforced privileges for corporations in the form of various subsidies and protectionist barriers to the free movement of people and trade, subsidies and regulations concerning official "workers" and "employers", disproportionate protection for official work contrasts as opposed to other private contracts, and so on. More radically, many anarcho-capitalists argue that the traditional government protection of limited liability for corporations is an illegitimate form of protectionism that insulates corporate owners from full responsibility for their actions, and harms those who are denied the right to sue them for damage or debt.

To anarcho-capitalists, contracts in general, and employment contracts in particular, are but a particular case of voluntary exchange of property (property of one's time and work, of one's goods and capitals, etc.), that individuals may freely get involved in. Individuals may take any legitimate steps within their property, including the self-defensive use of force, to protect whatever they have gained from such contracts. On the other hand, they do not deserve any special protection above and beyond the protection of the peaceful exchange: just because two (or more) individuals agreed something together at some time does not mean everyone else suddenly owes them protection from each other, from third parties, or from the accidents of life.

More generally, anarcho-capitalists do not recognize any monopoly authority for declaring any arrangement "official" as opposed to other "unofficial" things. Thus, for anarcho-capitalists, no-one has the rightful authority to enforce special benefits or penalties for "official" arrangements above beyond the legal status already given any other private contractual arrangement.

One illustration might be the present debate over same-sex marriage. For anarcho-capitalists, both sides of the debate operate on fundamentally flawed premises. Opponents of same-sex marriage on the Right argue that the State should give special status to the family arrangements of heterosexual couples who enter into an "official" marriage, and inflict special penalties on same-sex couples by refusing to give legal status to their private family arrangements. Liberal advocates of same-sex marriage, on the other hand, argue that both heterosexual and same-sex couples should be allowed to enter into an "official" marriage and gain special benefits from the State. Anarcho-capitalists differ from both positions: they deny the legitimacy of distinguishing between "official" and "unofficial" family arrangements, and argue that no-one should receive special legal benefits. Thus, they argue that in a free society any group of two (or more, for that matter) consenting adults have the right to set down a private agreement about family arrangements, and that that private agreement is as good in legal terms as any other.

Of course, just as with corporations, a private agreement between two or more parties doesn't place a duty on anyone else. Private individuals have every right to choose for themselves whether or not to smile upon the family arrangements that particular consenting adults make. Thus, the owner of an insurance company that disagrees with same-sex marriages should not be forced to extend benefits to same-sex partners; on the other hand, the owner of an insurance company who endorses same-sex marriages has every right to extend benefits to same-sex partners that he wishes. Gay liberation activists are free to boycott the first provider and support the second provider; Christian conservatives are free to boycott the second and support the first.

Anarcho-capitalists have very widely differing social views, ranging from the conservative and often religious paleolibertarians to moderate liberals to the far Left. As such, they tend to disagree about which of these arrangements are best. What they don't disagree about is which of these communities ought to be legal--they should all be allowed in a free society. Most anarcho-capitalists expect that different communities will tend to coalesce around different social norms and attitudes; within these communities, more common forms of private arrangements will have more extensive jurisprudence than less common forms, and thus lower enforcement costs, which might make some arrangements more common than others. The only important political issue, however, is that people are free from the threat of violence no matter which community they live in, and that they can freely move from one community to another. As long as that is the case, there may be many arguments about fairness or virtue, but there are no arguments of legality.

Anarcho-capitalism and violence

Anarcho-capitalists, like classical liberals in general, argue that the use of violence should be restricted entirely to self-defense of person and property. A few anarcho-capitalists are outright pacifists, but most defend the right to use force in defense of person or property against criminal acts, and many argue that the defensive use of force may include revolutionary violence against tyrannical regimes or even war against dangerous imperialist or terrorist foreign states. However, even though they might approve of violence as legitimate in certain cases; even though they may concede that governments, having monopolized the means of violence, are the ones who currently are to enact this violence; they believe that governments should yield this monopoly of violence, and let individuals organize freely to better handle such situations. (One prominent example of such mixed feelings is the admiration that many anarcho-capitalists express for the American Revolution. Many anarcho-capitalists see the American Revolution as the legitimate act of individuals working together to fight against tyrannical restrictions of their liberties, but also sharply criticize the Revolutionaries for the some of the means used — taxes, conscription, inflationary money — and the limitations of the result achieved — a government that slowly grew to become the largest government in the world.)

However, whether or not a given group of anarcho-capitalists thinks that forceful resistance and revolutionary violence are legitimate, the vast majority of anarcho-capitalists think that gradual change through education and modification of public opinion are more reasonable as a strategy. The use of force is seen as a dangerous tool at best, and violent insurrection is usually seen as a last resort. (Some anarcho-capitalists argue for a third option: simply circumventing the State by working to found a libertarian society in some territory uncontrolled by statists.)

Arguments for and against Anarcho-Capitalism

Anarcho-capitalism being a radical version of liberalism, the same general arguments for and against liberalism, laissez-faire capitalism and capitalism usually apply, except as regards the justice system, in which anarcho-capitalism is more specific and differs from the classical liberal tradition.

A common misunderstanding about liberalism in general, and anarcho-capitalism in particular, is to consider them as economic or political theories. They are not. They are theories of Law — of what is or isn't legitimate to do. This in particular defeats the gross affirmations according to which today's society or any society is already libertarian, since everyone is ultimately free to obey or disobey and chooses to abide by the rules of the system: indeed, libertarians have a theory of "natural law", i.e. law as it should be; and as long as positive law (law as it is acknowledged) doesn't match natural law, the society is not libertarian. In particular, the right of anyone to secede from a government he considers unfit should be respected (see secession and urban secession). If not, then non-cooperation is morally justified (see civil disobedience).

Parallel arguments are made by other movements with a similar belief in the existence of natural law, but a different conception of what that law implies for human behavior. For instance, the green movement contains a strong strain of green anarchism with a concept of natural law based on the science of ecology, and more minimalist advocates of eco-anarchism. The convergence between these movements and tenets of syndicalism and anarcho-capitalism leads some to observe that green politics is often libertarian, and many political positions, e.g. the green tax shift, resemble measures advised by libertarians and anarcho-capitalists. Such measures, very broadly stated, tend to degrade special status of debt (which takes a strong state to guarantee and collect it) but sees profit as the basis of prosperity.

This common strength of movements with different concepts of natural law is one of the key arguments for anarcho-capitalism: it accommodates much diversity.

However they see diversity or biodiversity as a value, there is some role accepted by most anarcho-capitalists for strong centralization of some powers, particularly if those are achieved by persuasion and good service, and restricting centralized power would put restrictions on property rights.

Defense Agencies and Monopoly

One of the most common criticisms of anarcho-capitalist prescriptions is that, in practice, the free market "defensive agencies" that they envision providing defense services will collapse into monopoly governments, creating (at most) local governments controlled by market wealth in the place of larger constitutional governments. This amounts to arguing either (a) that governments represent natural monopolies rather than coercive monopolies on the defensive use of force, or (b) that anarcho-capitalism will make it more likely for coercive monopolies (in the form of local plutocracies) to form. Considering the merits or demerits of this charge requires a consideration of the anarcho-capitalist understanding of monopoly.

Anarcho-capitalists, as libertarians, are not opposed natural monopolies (or de facto monopolies, in which a company happens to currently be the only provider of some service due); rather, they are opposed only to coercive monopolies (or de jure monopolies, in which a company or a cartel of companies is guaranteed a monopoly through the use of political force). Or rather, to be more precise, anarcho-capitalists are not politically opposed to natural monopolies--that is, they do not advocate the use of political force to prevent them or break them up. Most anarcho-capitalists are economically opposed to natural monopolies or quasi-monopolies inefficient methods of production, and may support economic actions against natural monopolies that abuse their market position, such as boycotts and worker strikes. But precisely because they see natural monopolies as inefficient, they also endorse economic arguments that natural monopolies can exist only transiently, usually due to some recent technical or organizational innovation that hasn't been copied by competitors yet. If goods or services come at prices that are too high or quality that is too low, customers will look for alternatives, and entrepreneurs will soon be able to make a killing by entering into the monopolist's market. Thus, moral purchasing rather than political force is the motto of libertarians in general, and anarcho-capitalists in particular. Applying this reasoning to the protection of individual property rights, most anarcho-capitalists do not fear the emergence of local monopolies or oligopolies in the justice market — as long as the individual right to secede and choose a new defense agency, or start a new one yourself, is respected.

Anarcho-capitalists argue that opponents misunderstand the nature of private (or public) protection and justice systems. For instance, anti-capitalist anarchists often consider private property (which they distinguish from possession) as an institutionalized enforced privilege, and so regard individual or collective defense of it to be a form of illegitimate violence. Anarcho-capitalists, on the other hand, typically argue that a broad classical liberal conception of private property is justified independently of the State, either by utilitarian considerations or by natural law. Thus, they argue that individuals can use force to defend a wide range of private property, and they can cooperate with others or hire a defense agency to defend whatever they can rightfully defend on their own.

Some anti-capitalist anarchists respond that a cooperative group which sets to enforce its claims, without accounting for the active involvement of dissenting parties, would constitute a de facto institution of enforced privilege, which they hold is identical to a State in all but name - thus incompatible with anarchism. Part of the conflict is the result of debates over fundamental perspectives on issues of social organization, justice systems, property, self-defense, and so on: many anti-capitalist anarchists — though not those who identify with the tradition of individualist anarchism — approach these from a collectivist socialist standpoint, whereas anarcho-capitalists, consider any kind of collectivist political decision as oppression of the political minority by the political majority. In response, collectivist anarchists tend to argue that anarcho-capitalism would involve the oppression of the political majority by the economic minority, and that collectives based on consensus would by definition not be able to oppress a political minority.

These debates, in turn, are often seen as fruitless by anarchists who view the "left-right spectrum" as an irreconcilable and artificial abstraction that simply institutionalizes debate about an existing property rights system, as opposed to examining the life-purposes fulfilled by such entities. One such example is "Greens and Libertarians: the Yin and Yang of our political future", in which Dan Sullivan, a Libertarian from the United States, explores common attitudes about monopoly and draws a new bottom-to-top spectrum, claiming that the Green and Libertarian political movements disagreed on the appropriate scale of solutions, but that they generally saw many of the same problems and disdained left-right arguments. The common belief in natural law made it at least possible to debate differences amiably, in a way that the traditional worker-manager divide did not permit.

Crypto-anarchism

The development of the internet and cryptographic methods raises a new possibility for achieving some aspects of anarcho-capitalism on the internet (or 'in cyberspace'). Pseudonymous communication allows services, especially information services (e.g. consulting, translation, programming, etc.), to be provided without revealing the physical identity of the person providing a service in exchange for anonymous electronic money. As laws can not be enforced without knowing the identity of people, the relevant laws become irrelevant. (As even the location (country) of the individuals are unknown, it is not even clear which country's laws will be ignored. In a sense, 'cyberspace' can be regarded as an independent territory.)

See also: libertarianism, anarchism, panarchism, capitalism, classical liberalism, crypto-anarchism, Ama-gi.

External links

Anarcho-Capitalism Websites

• Bryan Caplan's "Anarchism Theory FAQ"
• anti-state.com, has one of the more active forums and infrequent theoretical and practical articles.
• LewRockwell.com is a widely read anarcho-capitalist news site with a Catholic slant.
• Strike The Root is an anarcho-capitalist news site with an atheistic slant.
• Panarchy, another way of considering things that is considered by some ultimately equivalent to anarcho-capitalism.
• Anarchism.Net sells books
• David Hart's Gustave De Molinari And The Anti-Statist Liberal Tradition
• Liberalia, an anarcho-capitalist site
• Bertrand Lemennicier, a renowned French anarcho-capitalist economist and his links (English and French)
• Anarcho-Capitalism links
• Hans-Hermann Hoppe interview

• Within libertarianism, anarcho-capitalism is contrasted with minarchism. Criticisms of anarcho-capitalism by minarchists include Robert J. Binidotto's The Contradiction in Anarchism, and Paul Birch's A Fatal Instability in Anarcho-Capitalism? and Anarcho-Capitalism Dissolves into City States.
• Within anarchism, anarcho-capitalism is contrasted with libertarian socialism. Anti-capitalist anarchist critiques of anarcho-capitalism include Section F of the Anarchist FAQ and Jeff Draughn's Between Anarchism and Libertarianism: Defining a New Movement. Anarcho-capitalist critique of left-anarchism is the subject of another article.
• Whether anarcho-capitalism is also to be contrasted with individualist anarchism is a matter of some debate. For one individualist anarchist view, see A Brief Introduction to Philosophical Anarchism.
• Most broadly, anarcho-capitalism is contrasted with statism.