Decentralisation and Liberty

Leave a comment

In some recent essays concerning the UK’s referendum in June to determine its membership of the European Union, and the virtues of small states as opposed to larger states, we elaborated some themes regarding how decentralisation and decentralising processes are a boon for individual liberty and a step towards harmony and economic progress. This essay will gather these thoughts together with an emphasis on how small or, rather, optimally sized institutional units pave the way towards two things that not only libertarians, but also everyone else, will claim to want to achieve – economic prosperity on the one hand, and minimal war and conflict on the other.

The mantra of statist and, indeed, mainstream political thinking is that unity, centralisation and the consolidation of states and state institutions is the way forward for peace and prosperity. Not only does this mean larger state institutions with more power but also the fusion of individual states into larger territories under a single jurisdiction. In some ways this seems plausible, even to the libertarian. Wouldn’t unified laws will aid certainty? Wouldn’t we be better off if there were no borders or tariffs to impede the trade goods and workers? And surely the possibility of war will be diminished if we all join together under one, unified banner?

The main problem with this view, however, is that it places the state, state institutions and what these institutions wish to achieve at the centre of society. All of the millions of individual people and thousands of non-state, voluntary institutions that are motivated by their own desires, values and choices are ignored or at least subsumed by the grander edifice. Most lay people who hold the centralising view probably do so naively, but it is the primary preoccupation of statists and intellectual elites that society is something to be managed, controlled or directed by them and those like them while all of the lesser beings should be made to obey quietly with the confidence that their highly educated masters are doing what is best for them. Indeed, rather than seeing any value in individual, voluntary and non-state institutions, the centralising view treats the human race as one, giant, amorphous blob, like a lump of play dough that can be shaped in any way and manner that can be chosen at will – and that the easier it is for the dough to be shaped then the better society will be. Hence, the holders of this view are likely to look favourably upon institutional centralisation and consolidation which conveniently places more power in the hands of people such as themselves to achieve their shaping of society according to their visions. This attitude was rife, at least implicitly, among the so-called “Remainers” in the UK’s “Brexit” vote on June 23rd. Not only, is it believed, that all good things flow from the top down like manna from heaven, but that anyone who was in favour of leaving the EU was, in some way, stupid, backward or a kind of provincial, country hillbilly. For instance, shortly after the referendum, Professor A C Grayling called on Parliament to block Britain’s exit from the EU on the grounds that it is Parliament’s job to determine what is best for the electorate, the latter of which lack “the expertise, patience and time” to make decisions via a direct vote. The implication of this is that the people do not know what is best for them and they have blindingly walked down the path of sheer folly by voting to leave the EU, and they should instead have placed their trust in those better educated than themselves. However, he has completely missed the lesson that should have been learned from this result. The establishment wheeled out all of the big guns in order to persuade the electorate to vote for “Remain” – including the current and the three former living Prime Ministers, most of Parliament and the Cabinet, the Bank of England’s chief and other big bank bosses, the IMF, directors from at least fifty-one FTSE 100 companies, and many heads of foreign governments including the President of the United States – and yet “Leave” still won the vote. When the advice of all of these heavyweights is rejected by the British public then, instead of stooping into a sulk over the supposed stupidity of the great unwashed and demanding that they defer to the “expertise” of their so-called representatives, Grayling and his ilk should realise that such a rejection indicates that everyone is just a bit fed up of being told what is good for them and having decisions made for them by political elites. Such decisions and endless promises of peace and prosperity have brought us, in the last twenty years, two burst financial bubbles, massive money printing that has made the rich richer while failing to provide productive jobs and increasing incomes for everyone else, and at least half a dozen disastrous wars and interventions that are producing deadly blowback in the form of terrorism. What the elitist attitude ignores is that society is not something that is there to be engineered and moulded like a lump of metal in a blacksmith’s forge. Rather, it is made up of individual people who shape it according to their individual thoughts, feelings and desires, motivated by what they believe is best for themselves and for their families. An economy is not some giant machine into which goes “input” to be processed by “jobs” into some kind of “output”, nor is it necessarily true that the higher the numbers of “input”, “jobs” and “output” the better everything is. Rather, a prosperous economy is the product of individual people trading resources voluntarily in directions that they see fit so that they can satisfy ends that they wish to see fulfilled. “Society” is not a collective that demands broad brush categories such as “food” or “houses” or “better railways” etc. Rather, it is me wanting, say, a ham sandwich at 1pm on Tuesday, or you wanting a small apartment in the Hampstead area of London to rent for three years, a business wanting to invest in a small car factory that will be completed in the five years, and everyone else wanting a myriad of highly specific ends in highly specific places at highly specific times that are the product of our own choosing. The economy is not something to be directed by central banks who squash the rate of interest down to its lowest possible point through so-called “monetary policy” or “quantitative easing” in order to “stimulate” some kind of beast into life. Rather, the rate of interest reflects the strength of everybody’s individual preferences for consumption ahead of investment so that the correct amount of resources can be sustainably channelled into roundabout methods of production. Each of us co-operates, through the division of labour, to accomplish things that we each want with the resources available in varying timescales that we are each prepared to bear. It is this co-operation of individuals to achieve their own ends through the nexus of production, trade and exchange that creates a society and not any management and direction from giant, all-encompassing institutions that achieve their ends through force.

The second problem with the centralising view is that the achievement of peace and prosperity in fact demands the very opposite of state and institutional centralisation and consolidation. As counter-intuitive as it might sound, harmony is achieved by division, not unity, while the growth and strength of the human race as a whole is accomplished by the weakness, relative to each other, of its component parts. Economic prosperity, for instance, is characterised by a growing complexity of the economic system – an increasing division of labour with more and more different people specialising in more and more different tasks to produce more and more different products for more and more different people. In other words, its natural tendency is to spread outwards from the centre with more diffused, decentralised knowledge and specialisation. Growth and centralisation of the institutions that support this prosperity under the banner of unity are therefore likely to stifle rather than aid its progress. Indeed the very concept of “unity” requires the same, repeated rules for everyone and the same approaches towards everything regardless of their individual, specialist needs. Hence you get the proliferation, in large, consolidated states, of “one size fits all solutions” that attempt to force everyone through a single, “unified” channel, as though all of us with all of our differences characteristics and requirements are being squeezed through a sausage maker to create a bland, blended puree. (Curiously, those who champion centralisation and state uniformity are also the ones who squeal for “diversity” and celebrating “difference” – at least when those diverse differences are demonstrated or practised by favoured minority groups). Indeed, it is usually, if not always, the case in nature that as something becomes bigger and more complex it is characterised by greater division and decentralisation, not by increased unity and consolidation. A human being is not simply a larger version of a single cell organism. Rather, he is made up of a countless number of individual cells that coalesce into different organs and tissues, each of which specialises in different life sustaining activities. We do not have one, single “unified” organ that pumps the blood, inhales and exhales air, rids the body of toxins, acts as a nervous system and also as a skeleton. In other words as nature achieved a complex human being by decentralising and delegating various functions to different organs that act independently of, but symbiotically with each other, so too will humans only achieve a complex and prosperous society by increasing the division of labour and the degree of specialisation in more and more decentralised institutions.

Division rather than unity is also necessary for creating and preserving the conditions that economic prosperity requires – strong private property rights, minimal taxation and minimal regulation. The benefits of a large number of divided states as opposed to large, unified states, is that if one tiny state of a size equivalent to Luxembourg implements, say, an onerous tax then only that state is affected and the disruption to everyone else in the world will be relatively minimal. If that state introduces ridiculously high border tariffs then only the small proportion of global trade into that territory will be burdened while freer trade will remain for everybody else. Similarly if that state introduces burdensome laws and regulations that infringe upon people’s lives only those people will be affected. The hampering effects of state action upon economic prosperity will, therefore, be localised and minimalised in a world of deconsolidated, small states. In a world of much larger states and state institutions, however, the introduction of a tax will affect everyone; the introduction of a new regulation will affect everyone, everywhere at all times regardless of their own needs and preferences; and the introduction of a border tariff will affect the trade of everybody who wishes to trade across the lines of the large, unified state. Hence the hampering effects of state taxes and regulations and infringements upon private property are magnified as the state becomes larger. This is not all, however, for the incentives to tax, regulate and otherwise infringe private property rights are much greater in a large, unified state than in smaller states. Smaller states are, by their nature, economically weaker than larger states and are more reliant upon maintaining the free flow of goods and services from abroad which simply cannot be produced with the resources at home. Each state will therefore compete with all other states to attract foreign investment and the unhindered import and export of goods and services by minimising taxes, regulation and border tariffs. Because the jurisdiction of a small state covers only a small area, if its rates of taxation, regulation and border tariffs are relatively high then investment will simply flee to a more competitive jurisdiction which may be only tens of miles away and the standard of living in the small state will plummet. A large state, however, whose jurisdiction covers a larger territory and possesses access to a larger number of domestic resources has no such incentive to keep its tax and regulatory burdens to the minimum. With more domestic wealth and resources available and with the threat of capital fleeing for foreign shores thousands of miles away minimised, large states are free to increase their tax and regulatory predations to a much higher degree than smaller states. One of the supposed benefits of the EU is the so-called common market – the notion that goods and workers may move freely under a single tax and regulatory code. Yet any benefits achieved by having to deal with a single code are likely to be outweighed by its gargantuan size whereas a myriad of small and trifling tax and regulatory codes in a world of greater state division is likely to be a better condition for promoting trade and prosperity. Indeed, former UKIP/Independent MEP Godfrey Bloom has referred to the EU as a “customs union” rather than a market union – in other words, a single bureaucracy rather than a single market, a chance for the state to stamp out the irritating competition between states which forces them to keep their tax and regulatory rates low (as demonstrated recently in the EU’s disagreement over the rate of tax Apple had agreed to pay to the Irish government) and replace it instead with a giant socialistic paradise of government control. Instead of emphasising the “unionisation” of tax rules and regulations, those who wish to encourage economic prosperity should instead concentrate on reducing them – and the only way to do this is to make the state entities which impose them smaller and weaker, not bigger and stronger.

The argument for the “unity” and the consolidation of states becomes even more absurd when we consider the desire to preserve peace and prevent war. Murders are committed by murderers; rapes are committed by rapists; thefts are committed by thieves. If we want to minimise the effects of murders, rapes and thefts then it is obvious that the last thing we want is for all of the murderers, rapists and thieves to join together under the banner of “unity” so they are free to combine their powers to murder, rape and steal to a greater degree with increasing ingenuity. Similarly, wars are started by states and are fought between states. Therefore, if we wish to minimise wars and their effects then it follows that we need to make states smaller and weaker; it makes no sense whatsoever to make them bigger and stronger. The argument that unifying states is likely to prevent wars seems to rest on the assumption that government is the glue that holds society together and it is in fact all of the people whom they govern who are the cause of endless conflict. Thus a bigger and powerful government is able to “unite” all of these people and stop them from fighting each other. Nothing could be further from the truth. Apart from the fact that, as libertarians, we know that the state’s dependence upon force and violence for its wellbeing renders it an institution that is bound to inflict rather than prevent conflict, bigger and more powerful states are the enablers of bigger and more destructive conflicts rather than our salvagers from them. Private actors and institutions are necessarily splintered, decentralised and reliant upon voluntary trade for their sustenance. Tiny states have equally tiny tax bases from which they can command a very limited number of resources. The ability of such persons and institutions to start and sustain wars is extremely limited. Large states, on the other hand, are vast concentrations of wealth and power which not only have enormous tax bases from which to draw the means to fund eminently more destructive firepower but the advent of central banking – another creature of centralisation and “unity” – has allowed large states to fund their conflicts through monetary inflation rather than through demanding their citizens to cough up directly. So does anyone sensibly argue that private actors and small states would achieve the level of carnage and destruction that the large and powerful belligerents managed to reach in the two world wars? Does anyone believe that a decentralised world of small states and private institutions would have had the ability to force us to endure a generation and a half of potential nuclear terror during the cold war as the vast territories of the US and the Soviet Union managed to do? The most spectacular terrorist atrocity (i.e. an attack by non-state actors) of the past generation – the destruction of the World Trade Center in 2001 – killed just fewer than 3000 people, a figure which, while undoubtedly tragic, stands in the shadow of the more than 1 million Iraqis who have died as a result of the US invasion of their country. There would, of course, be fewer states left to fight each other in a world of consolidated, centralised states. However, this completely ignores the fact that the states that remain are armed with a destructive ability far superior to any minor state or territory – and especially compared to any private criminal. Any conflicts in a decentralised world would be localised to small pinpoints on the world map, affecting, at most, a few thousand people and, with the participants lacking the resources to continue fighting and disrupting trade for too long, would probably be over in weeks if not days. Contrast this to the situation in which we languish today where the ridiculous cult of interventionism and “collective security” – another banner of “unity” – forces all such local conflicts to be escalated into drawn out, global catastrophes, as the forays into Korea, Vietnam, Iraq, Afghanistan, Libya and Syria have demonstrated. It is clear that if we wish to preserve peace and prevent war then we need to prevent the institutions that start and fight wars – states – from becoming too big and powerful.

On a related note, there is a distinct air of utopianism in the minds of the centralisers and consolidators when it comes to the issue of preserving peace. War and conflict are doubtless terrible things and we would have a much better world if they did not exist. However, it is also true that, for as long as humans have walked the earth, individuals and institutions have run into conflicts with each other and that these conflicts have been escalated into violence. This is just human nature. Unwittingly, in trying to prevent all war everywhere and at any time by “unifying us” under the yoke of bigger and larger states, the advocates of such an approach have, instead, served to escalate the size and duration of wars and vastly magnify their destructive capabilities. The more sensible approach, we would suggest, is to acknowledge that war and conflict will always exist and to recognise that a superior social system will never eliminate these aspects of humanity entirely, just as in the same way libertarians do not expect a free market in private defence and security to ever completely eradicate murder, rape and theft. Our task instead is to find ways to reduce the frequency, duration and potency of these awful things as much as possible. When it comes to war only cutting the potential belligerents down to size and reducing their ability to wage destructive wars in the first place is likely to achieve this.

As we have seen, the liberating effects of decentralisation owe themselves to the relative weakness of deconsolidated and splintered states and state institutions. However, these liberating effects do not arise out of the smallness of the states and state institutions per se. Rather it is because the individual person becomes stronger relative to an institution the more decentralised and localised that institution is. Within his own immediate family, which may consist of only half a dozen people, an individual person’s needs and views are likely to be highly influential upon the other members of the family. They will attempt to provide for and accommodate these views and needs as an active part of their lives simply because the individual is close to them both physically and emotionally. An individual will have a little less influence in his immediate community or on a civil or parish council, where there are more people involved and few of them will be as familiar with him as his immediate family. However he would clearly have more influence in such a circle than in an entire town or city. And once, of course, we get to the level of an entire country such as Great Britain, a diverse nation of various economic, social and ethnic backgrounds, a single person’s lonely vote in, say, a general election becomes a drop in the ocean along with all of the other c. 45 million votes that are eligible to be cast. And if a country such as Britain was to be absorbed into a superstate such as the EU an individual may be drowned out by a chorus of 500 million other voices. The larger an institution becomes then the more its ability to focus on the “micro” issues that really affect people’s lives is progressively diminished and is replaced by a concentration on “macro” or global issues, the successful tackling of which is determined not by the wellbeing of individual people but, rather, by the measurement of aggregated statistics. So whereas, say, a family will care about whether Dad has a job that he enjoys and pays enough to feed and house the family or whether Grandma can get her hip operation in a hospital local enough for her to travel to, large state governments will instead care about GDP and the size of hospital waiting lists. Whereas a local council might focus on whether there is a sufficient bus service to a small community or whether a particular street is clear of litter, large governments, instead, have transport and environmental policies. Who in the bureaucracy is likely to care whether these policies might overlook the specific needs of one community or street some hundreds or even thousands of miles away from the capital? More local institutions are also likely to be populated more homogenously, with each person experiencing relatively similar priorities and holding a relatively similar worldview. Thus the ability to induce empathy between those who lead and those who are led is much more likely and, indeed, may produce more of a situation of symbiosis, or a sense of “working together” to further common goals as opposed to the “command and follow” routine of large states. In other words, even though a particular institution may still function officially through the methods of power and force, the smaller and more localised it is then the more likely such an institution will approach the individual and his needs in a voluntary and peaceful manner – or at least relatively so compared to much larger, faceless state institutions. Even the socialisation of property – considered to be the antithesis of libertarians, or at least right-leaning libertarians – is less likely to be a problem in, say, a small, voluntary commune where all of the commune’s members can air their views as to how their collective resources should be put to use and where all the members are likely to share a common motivation and purpose. Yet a similar exercise on a nationwide scale has always proven to be a disaster – not to mention, of course, that is easier for someone to leave a small commune than it was to leave, say, the Soviet Union.

It is important to realise that decentralisation is not necessarily about breaking every institution down into its smallest possible parts just for the sake of it. There is nothing wrong with large entities or institutions if such sizes generate advantages that could not otherwise be attained. Rather, the primary purpose of decentralisation is to devolve decision making authority (or what might be called “sovereignty”) to its the lowest possible level and that the closer this is to the individual then the more liberating the decentralising effect will be. So there is nothing wrong with lots of individuals or small institutions deciding to form a large institution to achieve a common purpose. This is precisely what individuals do when they form companies and joint enterprises. Whatever criticism we might hurl at the inadequacy of corporate governance and executive dominance, it is still basically the case that the individual shareholder of such an entity can liquidate his position if he wishes to disassociate himself from the institution. Thus the ultimate fate of the institution is dependent upon the willingness of individuals to continue its existence rather than upon its own volition. When, however, such an institution, which may originally have been organised voluntarily, becomes the ultimate decision making authority – like the modern state has become – and is able to prevent its component parts from exercising any significant autonomous power that would seal its fate, then the anti-liberating effects of consolidation and centralisation will be felt. This has been the case with the United States which, having started off as an association of small, independent, sovereign states has become, at least since the American Civil War, a compulsory union with the power concentrated in Washington DC rather than in the state capitals.

Decentralisation cannot depend solely upon formal, constitutional arrangements or treaties and it is naïve to argue that such set ups are adequate. What matters is where the de facto ability to enforce decision making power lies. An individual shareholder has de facto power over a company, for instance, because a court will enforce the sale of his shares and whatever other rights he may have. Technically, the individual member states of the EU remain wholly sovereign nations and, indeed, are so at this present time – the perceived loss of sovereignty of which its citizens complain has come in part from the fact that the politicians of the individual state governments have been happy to haemorrhage more and more powers to Brussels that override the individual, local needs of each country. However, if all of the military, policing and judicial might of the combined EU member states was to be consolidated in Brussels – which is, of course, the eventual aim of the super-statists – then it would be the case that no individual member state would retain the ability to enforce its sovereignty over the larger entity. Hence, it was a good thing for the UK to vote to leave the EU before such a consolidation occurred. What matters for the process of decentralisation and its liberating effects, therefore, is that any legal or enforcement system must be able to give effect to the decision making authority of smaller and smaller institutions. Therefore, large, standing armies, and consolidated police forces and judicial systems run from vast buildings in the capitals of large states, such as the Pentagon in Washington DC, are the biggest fears for those of us who wish to achieve a world of liberty – and with it, a world of peace and prosperity.


Leave a comment

It is widely believed in mainstream circles that equality between human beings, in one form or another, is some kind of virtue to which society ought to aspire and that rank inequality is a measure of severe injustice that needs to be corrected by state action. Equality between individuals has also been used as a primary weapon against those who favour capitalism and free exchange. Even though the worst excesses of inequality – such as the rising value of assets owned by the rich as a result of worldwide money printing – are in fact, products of a state corporatist system, it is true that proponents of the free market favour a system in which some people will be wealthier by virtue of their ownership of a greater number of resources than other people.

Our critique of equality here will be somewhat different from the usual free market or libertarian approaches towards tackling this issue, which normally explain the virtues of the free market and the ethics of private property and how these are better than striving for some kind of equality. Although we will certainly champion these arguments, our approach will be two-pronged. First of all, we will conclude that the aspiration towards some kind of perfect or immediate equality – i.e. the forced attempt to render all people absolutely equal now with today’s stock of wealth and resources – is undesirable, impractical and far from being a moral virtue. However, more importantly, we will go on to argue that, if someone desires a more approximate or gradual achievement of equality – such as the so-called “equality of opportunity” – statism, socialism and any kind of redistributionism must be abandoned and that those who seek to create such equality must instead embrace a social order that maximises the production of wealth. That social order is, of course, free market capitalism.

Perfect Equality

Our starting point in examining the advocacy for some kind of perfect or immediate equality is to acknowledge that nature places a formidable number of obstacles in the way of achieving such equality. One of these barriers is the fact of human action itself – the ability of each individual human to think, desire and consciously choose to devote the resources at his disposal in ways that he deems fit. In other words individual humans make decisions to act independently of one another. Some of these decisions will be good or better decisions while others will be bad or worse. Some people will make a greater number of bad or worse decisions than good or better decisions while others will make a greater number of good or better decisions than they do bad or worse decisions. The varying results of these decisions serve to place people in a state of inequality, with those that make good or better decisions ending up in a better condition than those who make bad or worse decisions. Any attempt to subvert these outcomes and to create, instead, a greater degree of equality between humans would subordinate all individually motivated behaviour to the directions of the state, lest anyone was to act in such a way as to put himself in a position better than that of his fellow human. Although this would be undeniably totalitarian and despotic the more crucial point is that any such drive towards equality would require a complete annihilation of the preeminent quality of human nature – that of rational action. It would render us all as nothing better than automated robots, unable to act upon our own feelings and desires while under the control of our political lords and masters. Hence, unless anybody is happy to become an unthinking cog in a society that represents mere machinery then we must conclude that equality is an inherently undesirable goal.

This formidable obstacle placed in the way of equality by nature – the fact that we think, choose, desire as individuals – renders perfect equality not only undesirable but also impractical. Let us say that even if we were able to stifle all individual human action and create a perfect material equality between every human being. It would still be the case, however, that individual people would value these possessions differently. A white stick, for instance, is likely to be very valuable to a blind man yet next to useless to a sighted man. If you give both of these men a white stick it is clear that, even though their physical, material possessions are identical, one has gained value more than another. Thus, if we have to strive for perfect equality it is useless to attempt to distribute resources equally, lest someone ends up more happy and content with the same possessions than somebody else and thus rendering them in unequal conditions. Perhaps such a problem could be resolved by simply giving them an equal amount of money? Wouldn’t everyone then be able to spend their equal amount of money on different things that are valuable to them? Unfortunately this would not work either because one person may need to spend more money to gain the same amount of satisfaction as another person. People who are more satisfied with spiritual and non-material needs may be content with spending very little of the money allocated to them whereas those who are materialistic and seek value in possessions may require a lot more for them to feel as happy as the non-materialistic folk. What the budding egalitarian would have to do, therefore, is to attempt to provide for each person’s needs regardless of the precise quantity of goods required for those needs. So in other words one person may receive a lot whereas another person would receive very little if they are both made equally satisfied by what they receive. This, however, turns the whole of economics on its head. Economising behaviour regulates needs to the goods available. Needs are insatiable whereas goods are scarce and we must choose which of our needs we value the most in order to allocate the goods available to them. There is not a fixed number of needs or a fixed quantity of happiness shared between all people which can be satisfied by an abundant stock of goods. Needs are also intangible entities, existing in only the mind. They cannot be measured with any yardstick and any attempt to do so would simply subordinate the real value of the needs as perceived by individual people to their value as perceived by some bureaucrat – and, of course, this bureaucrat will have his own motivations for determining who gets what. One’s own value of one’s needs is subordinated to the value of those needs as perceived by the state. Anyone who has needs deemed unworthy by the state, perhaps because they are “unpatriotic” or somehow not in keeping with the spirit of the “the people”, will be left far worse off than those who toe the state’s line, which is how redistributionist policy always works in practice.

If we look more broadly at the entirety of the natural state of human beings, things do not get much better for the budding egalitarian. Indeed so inherent is the natural state of inequality between human beings that we could even suggest that Mother Nature intended it to be so and that she willed such a state to be permanent. Individual people are born with different qualities – different heights, different weights, different physical and mental capabilities, and so on. So too are the environments into which they are born different. Not only will their parents and those around them also have varying characteristics and varying abilities at raising their offspring, but the precise climate, geography and availability of natural resources will differ from place to place. Hence, the Earth itself gifts different people differently and presents them with different degrees of challenge for them to live their lives. Some of these environmental differences are likely to have had a cumulative genetic impact as a result of natural selection that exacerbates further inequalities. A society which has developed in an area where resources are plentiful and where little work needs to be done to ensure survival will have had its physical and mental capabilities tested to a much lower degree than a society that has developed in a barren area where resources are scarce and what little the earth has to offer must be obtained through ingenuity and backbreaking physical work. Only the most intelligent and strongest will have survived and prospered in the latter society whereas practically anyone could have lived in the former society. After generations of reproduction, therefore, those who are born today in the latter society – the “difficult” one – are likely to have superior mental and physical attributes that are not enjoyed by those in the “easy” society. Ironically, therefore, those who descended from a society which originally had “less” are those who are likely to command greater wealth and income, by virtue of their superior strength and intellect, in today’s society characterised by global trade and the division of labour. Indeed, given that we have mentioned trade and the division of labour, we might as well point out that any drive towards an immediate and perfect equality would require the complete eradication of these elements for they are clearly founded on a rank inequality. The division of labour cannot exist unless people utilise different skills and different abilities to undertake different tasks. If two people wish to trade it is because they each start off with different things and each wish to obtain different things through the trade. In other words each partner to the exchange desires to be different and views himself as having gained something more than what he parted with.

The fact of all these inequalities alone does not, of course, prevent equality from being a virtue. Simply because something is does not been that it ought to be. However, the manifold extent of inequality that has been presented to us by nature indicates that, in order to reverse such a natural state, a considerable and extensive power of man over nature will be required. It is here where the notion of equality as an argument for some kind of socialism or redistributionism collapses. Creating a condition of equality will not require, as is typically supposed, a redistribution of existing wealth – that is, man’s existing power over nature – but, rather, the generation of more wealth in order to overcome the formidable barriers to equality that nature has put in our path. Those who desire equality should, in fact, not be dreaming up ways in which to rob the rich to give to the poor but, rather, should be finding the best possible way to ensure wealth creation. As we shall explore now it is in fact a society of private property and free exchange – i.e. of capitalism – which, by virtue of its superior productive ability, accomplishes this and which makes a tendency towards greater equality more likely.

The Equalising Tendencies of Capitalism

While we examine the equalising tendencies of capitalism, we must admit, lest w be accused of creating a straw man, that equality is not usually advocated in any perfect or absolute sense in the manner that we just subjected to criticism. Egalitarians do not typically strive for the complete eradication of all differences and idiosyncrasies between humans, even if social systems founded upon equality have tried to decimate all independent and unapproved opinions, culture, tastes, and personal habits. The staunchest of such egalitarians will still admit that the division of labour – upon which human prosperity depends – requires some people to be garbage collectors and others to be brain surgeons, for example, and that it would be a travesty for everybody to be garbage collectors or for everybody to practise brain surgery. Rather, the egalitarian strives for some kind of approximate equality. After all, approximate equality could be achieved so long as everybody is doing the job that he most enjoys and/or is best at, and surely people having some kind of access to roughly the same amount of wealth would be better than nothing at all? To implement such a programme through a socialist society would, however, produce the very opposite of equality. In a society governed by private property and free exchange, the ownership of all of the material wealth in existence is scattered between all of the private individuals who inhabit the Earth. As all persons are free to make their own decisions as to how best to deploy their wealth it is true that some people will have accumulated more while others will have accumulated less. However, those who accumulate more do so because they serve the needs of consumers better than anyone else – consumers entrust these resources to these particular people because the latter have, so far, proven themselves better at directing them to the most urgent wants of the consumers than anyone else. The wealthy in a capitalist society cannot abuse their position as their fortunes would soon begin to haemorrhage. Rather, they must continue to serve the needs of consumers better than anyone else, or consumers will drop them and their products in a flash while the productive assets that form their wealth will be transferred to other people. There also seems to be something of a limit on how much of societal wealth any individual can command in such a society. As of 2016 the wealthiest man in the world, Bill Gates, has a total fortune of $81.7 billion – a drop in the ocean compared to the $3.7 trillion budget of the federal government last year, and peanuts compared to the sums that central bankers like to print from thin air. Warren Buffett, widely regarded as the most successful investor in history, has admitted that achieving a significant annual return for his firm Berkshire Hathaway is now much more difficult than it used to be on account of the size that the firm has now achieved. It is typically believed that capitalism has a tendency towards monopoly, with more and more wealth being sucked into the clutches of a few powerful oligarchs. The opposite is in fact the case – one individual entrepreneur or investor can only direct his attention to so much before his talents are spread too thinly, or he has to delegate to lesser individuals. Hence, inefficiencies begin to creep in which provide an advantage to smaller, more nimble competitors and thus checking the growth of any established player. In a socialist society, however, matters are completely different. If you deprive all of the individual citizens of their ability to direct their labour and their resources to the employments that they feel are best then these decisions have to be made by somebody else. There must be someone who has de facto ownership and control over resources in order for these resources to be directed. These people are, of course, those who form the state and its planning bureaucracy. Clearly this amounts to an enormous concentration of wealth in the hands of a very small, political elite, a concentration which by far exceeds that of the wealthiest individual in a capitalist society. These elites will direct resources according to what they value rather than what is valuable for everyone else. Not only will you get parades of missiles accompanied by goose stepping troops, and the construction of vanity projects such as the unfinished 105 storey hotel in Pyongyang, but even if the direction of resources is for the benefit of other people this light will be refracted through the prism of the elites’ own preoccupations. If the minister of a particular socialist state or department thinks single mothers are hard done by then single mothers will get more; if he is an ex-railway worker then he is likely to account for the condition of railway workers more than someone who has no such background; if a relative of his died from cancer then he is likely to want to devote more resources to cancer research than someone who has had no such exposure, while those suffering from other illnesses and conditions must put up with lesser treatment. And, of course, he will have every incentive to direct wealth to personal favourites and political supporters that serve to keep him in his powerful position. No longer is his status and privilege determined by serving consumers who can choke off his supply of funds at any point they desire. Rather, he now depends upon currying favour with his political contemporaries. Furthermore, if he is able to maintain such favour he can simply resort, when directing resources to where he wants, to the use of force rather than the use of persuasion through offering a valuable service. Socialism does not eliminate any unequal, societal statuses; it simply changes the game of who rises to the top – and when you are at the top you are more unequal from the rest of society than in a capitalist economy. Moreover, socialism cements these statuses from a revolving membership determined by who best can serve consumers into semi-permanent and impenetrable political castes. All of this can be illustrated today in some of the so-called democratic socialist countries such as Venezuela, where the daughter of the late, former President Hugo Chavez enjoys a personal fortune of approximately $4.2 billion, while the country’s socialist policies have made basic necessities so scarce that the black market price for a dozen eggs have reportedly reached $150. According to The Daily Mail, at the Caracas Country Club the nation’s super rich socialists “enjoy lavish parties and gourmet cuisine, while middle-class people are forced to scavenge for food” at a membership cost of 458 times the average Venezuelan salary. The attitude of the elites is almost literally the modern day equivalent of Nero fiddling – “Should we stop enjoying ourselves just because the country is burning?” one is quoted as saying. Far from being a creator of any kind of approximate equality, socialism widens the gulf between rich and poor immeasurably, and to the extent that people are equal at all they languish in equal destitution.

Of course, after the twentieth century failures of communism and socialism, the aims of the equalisers and egalitarians have been watered down further into vaguer nuances such as the so-called “equality of opportunity” – i.e. that everyone may become richer and may become better off than other people as a result of their own talents and hard work so long as they all start off from the same supposed springboard. The idea is, in other words, that if an individual is born to wealthy parents resulting in a high quality of education and a comfortable upbringing he has a “head start” against someone from a poorer background who does not have these benefits, and that it is this kind of inequality that should be eradicated through redistribution. In the first place, any kind of birth into wealth and affluence does not by itself guarantee that the individual will have any talent or affinity for hard work. Indeed, the opposite is likely to be the case if he knows that, in order with stave off any hardship he encounters, Daddy will simply whip out his cheque book. Somebody who is less privileged, however, who has no alternative but to use his natural abilities and dedication to get ahead is more likely to do so. It is for this reason that most of the significant entrepreneurs and inventors were drop outs and rebels against the formal system of education and progression. The traditional path through school and elite university really only prepares one for a career in the establishment professions such as law, banking and the civil service – occupations which make you well off largely because the state ensures that your wealth is perpetuated. However, if we accept the premise that equality of opportunity through providing equal resources to the young will benefit the latter then it would not follow that the best manner to achieve this would be through redistribution. Rather, it would be better to follow a path of wealth creation so that the poorest in society are able to afford a high quality education – and an education of higher quality than the rich may have enjoyed in the recent past – sooner. The reason for this is that it is not the relative difference between rich and poor that is the significant factor – rather, it is whether the poor have enough to put them in a position in which they can compete effectively. While it is true that, in a capitalist society, the rich will get richer as the poor get richer and thus the rich will always be able to afford “more” than the poor, there is only a finite amount that they can spend productively on, say, educating themselves highly and sharpening their talents for entrepreneurship before any additional resources in this direction will produce diminishing returns. For example, a person can only read so many books in a day; if a rich person spends more on books he will not become more educated than a poorer person if he never has time to read those books. So if wealth creation results in the poor being able to afford as many books as the rich can read then both rich and poor will be equally well read. The rich may be able to afford more tutors than the poor, but they can only absorb so much information from so many tutors before all these mentors will drown themselves out in a cacophony of confusion. Therefore, if wealth creation permits the poor to afford as many tutors as the rich can absorb information from then both rich and poor will be equally well tutored. It is still true, of course, that the rich will spend more on educating themselves than the poor and it is also true that the rich will be the first to benefit from any innovations. However, as the poor get wealthier, this additional money spent by the rich tends to go towards additional pleasantries and luxuries rather than the substantial necessities of learning – for example, the classrooms may be nicer, the chairs comfier, the writing paper of a higher quality. But none of these things really matter a great deal when it comes to absorbing knowledge – or rather they matter far less than the poor being unable to afford any education at all. It is for this reason that wealth creation, through free market capitalism, rather than wealth distribution, produces a tendency towards equality and more adequately and permanently closes the gap between rich and poor, both in a very real sense but also in the sense of providing an “equality of opportunity”.

We can illustrate this further through examples in the wider economy. As Mises points out, when the automobile was first invented and only the rich could afford to purchase one, the gap between rich and poor was very wide. The rich had personal, motorised transportation while the poor had to go barefoot, put up with animal powered transport, or use the railway. Once, however, society became wealthy enough to mass produce cars that were affordable by the poor, both rich and poor now had access to motorised transportation. It is true that the rich spend more of their money on their cars than the poor do – and often a lot more. However, most of this additional money is spent on luxury additions such as higher quality paint and body work, sleeker aesthetics, leather upholstery and the fineness of the engine; the basic purpose of the car, to transport a person from A to B, is available to everybody and no amount of additional spending by the rich on their own cars can change this. This was not so before the poor could afford any car at all. Thus the gap between rich and poor has been narrowed through wealth creation. Similarly, the difference between a two bedroom terraced house and an enormous mansion is less than the difference between a house and no house at all; the difference between a gold plated toilet and a ceramic toilet is less than the difference between a toilet and no toilet. If a “poor” individual possesses a genuine talent his inability to afford champagne and caviar rather than bread and cheese is unlikely to prejudice his efforts to capitalise on this talent; but clearly he would be very disadvantaged if he could not afford food at all. What the rich spend on themselves goes towards luxuries and comforts which, while delightful, do not provide any significant material advantage to insulate themselves from a poorer person who can still afford the basics – and of course, the process of wealth creation soon places these luxuries in the hands of the poor anyway. Indeed, the rich, although they consume more goods and services than the poor, consume a lower percentage of their income than the latter do simply because more of their most urgent wants have been satisfied and additional consumption brings fewer and fewer benefits. The remainder of their resources therefore goes into investment or philanthropy – indeed, a wealthy society is awash with charitable giving simply because people have so much more to give. It is true, of course, that a poorer individual may have to demonstrate his talent if he is to persuade other people to fund him in his ventures, whereas a richer person could easily self-fund from his fortune. This, however, is arguably not a disadvantage. When you are risking other people’s money you have to rise to their standards and ensure that the decisions you are making are absolutely the right ones, decisions in which they will take a keen interest. Thus the talents and efforts of a poorer person are enhanced and focussed when he has to use other people’s money. Devoid of third party scrutiny, however, a rich individual, if he does not merely pursue his own flights of fancy without any check upon the hubris of his deluded conviction, is likely at the very least to be more slovenly and less disciplined in his approach. And in any case, if a poorer individual is genuinely talented then what is wrong with expecting him to establish this fact before others?

What we can see therefore is that any drive towards “approximate” equality or some kind of “equality of opportunity” is delivered not by a system of wealth redistribution but by a system of wealth creation. The only system that produces wealth creation, or at least produces it to its strongest possible degree, is a system of free market capitalism.

We might as well conclude with a final observation which is that people seem to be highly selective when it comes to advocating equality through wealth distribution. Apart from the occasional grumble it seems to be perfectly OK for elite sportsmen and women and movie starts to earn large amounts of money. Football enthusiasts in the UK are happy to wax lyrical about how many millions such-and-such a player is being “bought” for by a particular club, or how much one of them earns in a week, fully accepting the essence of the market and voluntary exchange in this arena. When it comes to the CEOs of multinational companies worth billions of dollars, however, it is always a different story – they are greedy fat cats, profiting off the work done by their underlings in the factories and production lines. This is so even though the multinational company may provide “essential” benefits to people such as food to eat and homes to live in, whereas the achievements of even the greatest athlete basically boil down to providing entertainment. The reason for this, of course, is that sporting and acting achievements are readily perceived by the individual, whereas the benefits of entrepreneurship and the stewardship of productive assets are not. If the cries for equality are to be consistent this should not really matter, of course – it should permeate all areas of human endeavour. However, if the ready perception of a wealthy person’s achievement is enough to justify it in the eyes of everybody else then clearly libertarians and free market enthusiasts should continue to extol the benefits of entrepreneurship and attempt elevate, to the level of sportsmanship and acting in front of a camera, the status of businessmen, investors and capitalists who provide goods and services which people want to buy at prices they can afford. This may be the surest way to purge mindless egalitarianism from mainstream social thought.

View the video version of this post.


Leave a comment

The subject of immigration is keenly debated both within libertarian circles and in the mainstream, having been an important issue in the British referendum to leave or remain in the European Union on June 23rd and also in the forthcoming US Presidential election in November. This essay will outline the core libertarian theory concerning immigration before examining the key area for contention among libertarians – whether, in a world populated by states, any particular state should restrict or otherwise control movements across the border by persons who are not considered to be citizens of that particular state and whether this is in accordance with libertarian theory. We will also explore the additional question, assuming the same, worldwide condition of individual states, of which ways immigration can be said to be a “good” thing and in which ways it can said to be a “bad” thing.

In strict libertarian theory there is no treatment of immigration separate from the general libertarian approach to private property. In a libertarian world all pieces of homesteaded land would be owned by private individuals. Although the owners of neighbouring or otherwise closely situated pieces of land may share a common language, ethnicity and culture, there would be no legally defined national borders; all we would have are the borders, or rather, the boundaries of each parcel of private property marking the point where one person’s ownership ends and another person’s begins. Who, how and when other individuals cross these borders is a private matter for the property owner. It is his property and he can welcome and exclude whomever he likes and on whichever terms he likes. If the property in question is his home then his closest, most immediate family, who may also live there, are likely to have unrestricted access; more distant family and friends may be granted access at mutually agreeable times when they wish to see each other; a lodger will have access governed by a tenancy or licence agreement; and “handymen” or contractors may be granted temporary access to carry out certain work that the owner pays them to undertake. Everybody else in the world, on the other hand, is likely to be excluded. At no point, prior to any agreement or contract with the owner, does any person have a legal right to cross the border of another person’s property. An uninvited crossing is, in libertarian theory, defined as unlawful, aggressive behaviour and may be met legitimately with physical resistance. The only places where people could wander wherever they please, except for their own property, would be onto un-homesteaded or ownerless land as only in this condition would they be undertaking an action which does not interfere with the prior rights of another individual.

In a world populated by states, however, there are not just borders or boundaries between privately owned pieces of land; rather, there are borders between whole swathes of territory which form the landmass of the states. A particular stretch of land immediately on one of these borders need not be privately owned – it may be publicly owned if it is a road or a park or even ownerless if it is, say, an unkempt meadow (although the government will, of course, claim ownership over all un-homesteaded land). In such a world the question concerning immigration would not be whether immigrants would have the right to enter your home or, say, your privately owned business premises; not even the staunchest supporter of immigration contends that this should be the case and if we assume, as minarchists do, that the state has a legitimate responsibility to protect individual parcels of privately owned property from uninvited access by either foreign or domestic individuals then this stance is perfectly in accordance with libertarian theory. Rather, the issue concerns whether the state should grant, without question, prospective immigrants a right to enter the territory of the state at certain, designated  points on the border into publicly owned or ownerless territory that the state nevertheless claims is within its jurisdiction. This, necessarily, raises the further question of whether successful immigrants would be at liberty to access all publicly owned territory, such as roads, to use publicly funded facilities and to claim publicly funded welfare.

In this imperfect world of state borders the question we as libertarians have to answer boils down to how, in libertarian theory, we should treat the ownership of publicly owned land. If the government permits any foreigner to cross the border into publicly owned land can such an arrangement be equivocated with, or approximated to, an uninvited, physical invasion of owned property, in which case it would not be permitted? Or is it an action that is more equivalent to crossing into ownerless or un-homesteaded land and thus does not violate the rights of an existing owner? If we lean towards the first possibility then the resulting situation would be one of “open borders” – the de facto right of any foreigner to cross into publicly owned or ownerless territory of another state. However, if the answer is no then it does not follow that closed borders would result – it is only a quasi-invasion if foreigners cross uninvited. To listen to the mainstream arguments one would be forgiven for thinking that the immigration question needs to be met by an all or nothing answer – it is apparently a contest between liberals, or self-styled “progressives”, clamouring for fully porous borders on the one hand versus conservative, racist bigots who supposedly want to keep everyone out. We reject this false dichotomy and recognise that it is quite possible to be in favour of permitted, regulated immigration – allowing some people to cross the border as immigrants to come and live and work in the territory of the state while denying that privilege to others.

The most convincing reconciliation of this situation with libertarian theory is arrived at by asking a simple question. If the state was to dissolve itself today who, if anyone, would have the strongest ownership claim over the publicly owned land to which immigrants would gain access if they were permitted to cross the border? It is doubtful that such land can be construed convincingly as unowned given that it contains significant infrastructure – roads, railways, utility networks and so on – that have been deliberately engineered, bringing the land into a developed condition that is far from its natural, ownerless state. This infrastructure was paid for by the domestic, tax paying citizens for the benefit of domestic, tax paying citizens, and was not paid for by foreigners who have not been tax payers. It follows, therefore, that the strongest ownership claims to publicly owned land reside with the domestic, tax paying citizens of the state. As long as, therefore, the state owns and operates this land on behalf of the tax paying citizens it should be construed as the owned property of those citizens, to which non-owners can be excluded from entry in just the same way as a house owner may exclude strangers from his house. Thus it is reasonable to suggest that foreigners do not have a legitimate right to cross a state border. Moreover, if the opposite was true and libertarian theory was construed publicly owned land as ownerless then it would seemingly allow foreigners, or indeed, anyone, to homestead this land and take it out of public ownership. The suggestion that one could homestead a major road to the exclusion of the rights of those who were forced, by the state, to pay for that road’s construction, is clearly absurd.

An objection to this suggestion is that non-taxpaying domestic citizens, such as low earners and children, will be permitted access to the publicly funded infrastructure. If we are ascribing ownership of public assets to those who fund them through tax contributions then shouldn’t these domestic, non-taxpayers be excluded too? In the first place we could suggest that the taxpaying citizens – i.e. the taxpaying parents of children and taxpaying businesses who need customers to access them via public roads – have extended a quasi-invitation to non-taxpayers to use the publicly funded infrastructure. However, before we begin to contort our analogy in a tortuous fashion we have to remember that no answer we can give in this regard is going to be perfect. A world populated by states is not a perfect situation with which libertarian theory has to deal. Libertarian theory properly excludes the state entirely; however, if we have to suffer the state in some form then there is an impetus upon us to make it function in the most liberty-oriented way, an endeavour we can only accomplish by approximating ownership as it would be in a stateless society rather than by replicating it entirely. Moreover, it is probably not possible to distinguish taxpaying citizens from non-taxpayers on a public highway, whereas it is eminently possible to exclude foreigners at a frontier.

If we maintain this theme of attempting to approximate ownership in a stateless society we can also determine the situations where foreigners would be permitted to cross a border. As we noted earlier, in libertarian theory owners may invite non-owners onto their property as and when they see fit and upon whichever terms are agreed. Such an entry would not then be an invasion. The most likely way that such invitations could be extended to cross state borders would be if a foreigner is offered employment within the territory of the state, or married into a domestic family. Alternatively, perhaps, a foreigner may purchase property that is within the territory of the state. Critically, however, these invitations should initiate from private sources and private exchanges, not from quota systems or other arbitrary rules and restrictions emanating from the state. Not only does this serve more convincingly our approximation of public ownership with private ownership, but there are also sound economic reasons for stating that this should be the case. If, for example, an invitation to cross the border is dependent upon an offer of employment from a private company or individual it demonstrates that the skills possessed by the immigrant are genuinely in short supply within the domestic population as perceived by the real wealth creators. The immigrant will arrive and will be integrated into the employer’s workforce immediately, co-operating with the existing, domestic co-workers in the production of goods and services. This is less likely to exist with either unlimited immigration, or immigration defined according to government direction, where the influx of immigrants may simply be creating a greater supply of labour which pushes down the wages of existing, domestic workers, and is likely to increase racial tension and xenophobia.

Indeed, the economic cases for and against immigration are rarely stated correctly in the mainstream debate and so it is worth our while to concentrate on these for a moment. Those who advocate open borders will be keen to point out that immigrants bring productivity and skills which serve to increase the standard of living of the indigenous population. Those who argue for restriction, on the other hand, will stress that, in fact, an influx of foreign workers simply competes with domestic workers for employment opportunities, sowing the impression that foreigners are “stealing our jobs”. Both points of view contain kernels of truth yet neither is valid in all situations. Whether or not immigration is a benefit or a burden concerns whether labour and capital goods are balanced in a particular location. The applicable economic theorem in this regard is the law of returns, which states that if the quantity of a factor of production is increased while the quantities of the complementary factors are held constant, there will come a point when the increases will produce diminishing returns and, eventually, no returns at all. For example, a farmer who wishes to grow crops may take land, seeds, water and fertiliser as his factors of production. If he holds the quantity of land, seeds and water constant while increasing the quantity of fertiliser then at first he will experience increasing crop yields per additional unit of fertiliser he deploys. Eventually, however, further increases of fertiliser will produce fewer and fewer crops per additional unit deployed without further increases in land, water and seeds, until eventually there will be no additional returns at all. Finally, of course, production will cease altogether when the land becomes buried under a mountain of fertiliser. If, on the other hand, there are increases in the quantities of complementary factors of production in addition to increases in the quantity of fertiliser, it is possible for the farmer to experience an increase in crop yields per additional unit of fertiliser deployed. Exactly the same is true when the increased factor is not fertiliser on a farm, but is, rather, human labour. If labour is increased, through population increases, but it is not possible to increase the complementary factors of production then the increase in population will simply result in diminishing returns and an overall reduction of per capita real incomes. This will be particularly acute if there is a sudden influx of a particular type of labourer that requires specific types of complementary goods in order to be productive. If there is an increase in low-skilled, manual labourers then a given territory also needs to have the additional factories, machines, tools and equipment for them to use. If it does not then the existing stock of such items simply has to be used more intensively by a greater number of labourers, which, if the increase in labour is left unchecked, is the recipe for diminishing returns. There is no point in shipping in a boatload of carpenters if there isn’t enough timber for them to work on, or if there are not enough workshops to house them; it is futile to welcome more workers onto a car assembly line if the assembly line itself has not been built, or if there is a shortage of steel or aluminium. In principle, at least, this extends to highly skilled labour as well. If a state brings in from overseas a load of doctors then the additional hospitals, surgeries and medical equipment have to be available too. Obviously the situation can become dire if the incoming population cannot work at all – for example, if there are a lot of children suddenly entering a territory, or those otherwise demanding educational services, then there needs to be the additional schools and colleges, otherwise existing class sizes simply swell and the quality of education (i.e. the “returns” on inputs into education services) diminishes. All of these additional capital goods – the machines, the factories, the equipment, the raw materials and so on – are demanded right from the moment that the immigrants arrive and seek work. However, their availability is not immediate as the production of capital goods requires both time and, more importantly, savings. Therefore, if the labour is specific, i.e. specialised to only one kind of occupation, then immigration will serve simply to increase the supply of labour applied to the relevant capital goods, thus pushing down wage rates for the domestic population. If, on the other hand, the skillset of the immigrant labour is unspecific then it may be possible to put them to work in creating these capital goods – i.e. building the very factories and tools they need to increase their productivity. However, capital goods do not yield an increase in productivity until they are completed and if the immigrant population is to go to the effort of creating them then they need consumer goods to sustain them during this phase of construction, a phase which may take a number of years before the additional capital goods are able to increase the supply of consumer goods. The only source of the latter is the prior production of the indigenous population. In other words, the domestic citizens have to reduce their level of consumption today in order to save and fund the additional production of capital goods, thus lowering their standard of living. The only way to induce this voluntarily is to raise interest rates so that more people save out of their current income. However, higher interest rates are precisely what are discouraged by spendthrift governments and economists hypnotised by Keynesianism, who do everything that they can to lower interest rates and decrease the incentive to save. The domestic population therefore continues to maintain its preference for consumption over saving and so all that they see is higher prices for the very consumer goods they wish to buy and lots more people from far flung lands wanting to buy them. It was the understanding of this whole phenomenon which formed the basis of Malthusianism – that if population increases outstrip gains in productivity then society becomes, overall, poorer. For the indigenous population of a given state, the incoming population simply becomes competing consumers of existing, or a barely increasing stock, of goods and services. Indeed, some libertarians have pointed out that this may be the aim of the state in the first place – to bring in more welfare parasites and weaken the wealth and power of the indigenous population, thus expanding the size and scope of government.

On the other hand, it is clear that if there has been an increase in the non-human factors of production but not an increase in labour then these factors too will be subject to the same law, the law of returns. In other words, an increasing number of machines, tools and factories will be used by the same number of labourers, with the result that the latter become spread out more thinly over a burgeoning supply of capital goods. In this instance, an increase in population is precisely what is needed to increase productivity and to make use of the additional capital stock. So, for example, if an empty factory with nobody to operate it, and machines and tools lying idle, is filled quickly by immigrant workers then productivity can rise on account of the fact that there has been a commensurate increase in labour and capital goods. Such a situation is not unheard of in areas where there are extremely favourable reasons for creating capital goods – low tax rates, strong private property rights, good transport links, and good supplies of natural resources – except for a sufficient supply of willing labour. For example, a mining business has to open up shop where the ore it wishes to mine is located. The labour must come to the ore in order to ensure any productivity from the mine. Going back to what we said earlier, if there is an under or oversupply of either labour or resources, only private business owners and entrepreneurs should make decisions as to what moves where – whether labour should be moved to where resources are or whether resources should be moved to where labour is – for only they are in a position to judge, through pricing, profit and loss, which is the most cost effective solution in ameliorating the imbalance between labour and capital goods. Any direct action by the state in this regard will simply create surpluses and shortages either of labour or of capital goods in different areas, as government management of anything always does. Indeed, in a previous essay on “Overpopulation”, the present author argued that increasing population is generally not a concern, from an economic point of view, under conditions of an unmolested division of labour; but it does become a very acute problem when government interferes in population levels, especially in specific areas. In particular, if we look at the two most extreme positions the state could take with regards to immigration – a policy of completely open borders (or even an active pursuit of higher immigration numbers) on the one hand, and a policy of completely closed borders on the other – the former will tend to lead to a surplus of labour while the latter will tend to lead to a shortage. In a world without the state where each parcel of land was owned privately, areas with relatively high populations and low concentrations of capital goods would have higher access costs – higher prices to access roads, higher property prices, higher school prices, and so on, deterring immigrants away from an area where there are already too many people. On the other hand, areas with relatively low populations and relatively high concentrations of capital goods would have lower access costs, encouraging immigrants to move to the place where there are not enough people. Thus, through the pricing system, the market sends signals to prospective immigrants telling them which areas need them and which areas do not. In a world managed by states, however, a policy of open borders will mean that the free cost of access to state controlled territory such as roads, schools and hospitals artificially lowers the cost of immigrating, a situation which is, of course, exacerbated when immigrants have either unrestricted or lightly restricted access to welfare benefits. There will therefore be more immigrants and a higher population than the area requires. On the other hand, a policy of totally closed borders artificially raises the cost of immigration to the level of imprisonment or being shot on the frontier. Thus, while for some this cost is justified (as trying to cross the Berlin Wall was, although this border was directed at keeping people in rather than out), the overall result will be fewer immigrants and a lower population than the area requires. States with heavily restrictive immigration policies, such as the United States, can often find that their domestic companies become exasperated by the difficulty in hiring foreign talent while there will be relatively more attempts to cross the border illegally.

This leads us onto another central theme concerning immigration and that is racism and xenophobia. Any treatment of the topic of immigration cannot avoid addressing these issues, particularly given that any opposition, principled or otherwise, to a policy of “open borders” is often shouted down as racist or at least racially motivated. In the first place, libertarian theory has nothing to do with racism. Our conclusion earlier, predicated on the approximation of ownership rights with regards to publicly owned property, that states may, legitimately, restrict foreigners from crossing the border into the territory of the state says only that the state may choose to exercise such a restriction on behalf of its tax-paying citizens. It may equally choose to relax or forego any restriction. Libertarian theory says nothing about the motivations that the state, its politicians and bureaucrats, and the citizens it supposedly represent, may have for making a choice either way. It states only that they may make such a choice. Libertarian theory is emphatically not motivated by anything that could be construed as racist. Moreover, if one does cross over to a value judgment and state that immigration should be restricted in certain circumstances, as the economic concerns that we just outlined suggest is wise, then it is preposterous to assume that the motivation is necessarily racist. These economic concerns would be true in a world populated entirely by whites, entirely by blacks, entirely by Asians or whomever, all speaking the same language and all with a relative cultural homogeneity. Yet the argument – that an increase of labour without an increase in complementary capital goods would lead to diminishing returns – would still be exactly the same.

Rather, what we will attempt to argue here is that racism and bigotry derive from, rather than precede, a state’s policy of fully open borders and that it is such a policy which aggravates racial tension. A libertarian policy of managed borders, with invitations to cross extended to immigrations extended by private individuals and companies would, in fact, result in a relatively peaceful world where different races would co-exist without difficulty.

The key to understanding why this is so is to do with how the economic aspects we outlined above intertwine with cultural homogeneity in a given society. A society is not simply a collection of atomistic persons doing whatever they like whenever they like, even though such a society may exist hypothetically in libertarian theory. Rather, people in a society embrace a certain culture and the particular morals, rules, habits and hierarchies that are created by that culture. The reason for this is not accidental or spurious. Rather, relatively predictable, reliable, homogenous practices across the populace as a whole not only aid but may even be absolutely necessary for effective social co-operation, and it is through social co-operation – the division of labour – that people are able to raise their standard of living for themselves and for their families.  A common language is, of course, an important, if not the most important homogenous, cultural phenomenon required for social co-operation. It is no accident that in very few places in the world there is a complete mixture of different languages and that, for the most part, different languages are separated geographically. Even a country such as Switzerland, which officially speaks French, German, Italian and Romansch has different areas in which each of these languages is dominant, with only a handful of fully bilingual areas. The barriers to social co-operation if the opposite was the case are obvious. Imagine coming to work one day and finding that your boss speaks only Russian, your co-worker Chinese while the team you manage speaks a mixture of Spanish, Welsh and Punjabi. Cultural practices extend also, however, to such apparently menial aspects as the 9am until 5pm working day, or when the main meal of the day is eaten. If people stroll into the office whenever they please or vanish at 10 in the morning to enjoy a three course meal clearly social co-operation is impaired. This is not to imply, of course, that everybody has to do absolutely the same thing all the time in a given society. However, the exceptions prove the rule and different practices – such as working at night and sleeping during the day – are regarded as unusual. Moreover, there is also the fact that humans are a tribal race – we prefer to associate with those who are familiar to us, those who do what we do and those who agree with us, if only for the comfort of predictability, regularity and routine in addition to the contribution of such aspects to social co-operation. Indeed, if the benefits of cultural homogeneity for social co-operation are true then it is possible that our preference for it is an outcome of evolution, which has biased us towards desiring things, through instinct, that ensure are our survival and betterment. However, it would be a mistake to assume that most specific cultural practices emerged randomly or through simple preferences. Rather, they were shaped and formed by the challenges presented by the specific climate, geography, topography and the available resources of the particular locale. For example, the Mediterranean practice of taking a siesta in the middle of the day originated because the temperature was too hot to work at that time. Indian food makes use of a lot of spices because of the difficulties in preserving food in such a hot climate, a difficulty that was not quite so prevalent in regions further from the equator. The practice of circumcision originated out of the challenges posed to male hygiene and comfort in a hot desert environment. The creation of the family unit and sexual fidelity, which we take for granted today, originated at least in part from the need for fathers to bear the costs of raising their children when population levels in hunter gatherer communities began to outstrip resources, something which could not be managed in a culture of “free love”. The family is a cultural practice we see all over the world because the problem it solved was experienced throughout the world, whereas less universal cultural practices sought to solve only specific, local problems.

When immigrants move from one state to another they are usually moving from one culture to another – from one language, one religion, one set of social norms, one type of cuisine, and so on, to something else with varying degrees of difference. If a relatively homogenous culture is both a natural human preference, is a requirement for effective social co-operation, then it follows that cultures of both the immigrants and the indigenous population of a given state are not likely to mix naturally within the same locale and that, rather, one set of cultural practices must yield to the other. This is particularly so when the cultural practices of the immigrants were developed with regards to the challenges posed by their homeland and may be superfluous or completely contradictory to what is required in the state to which they have emigrated. When, as we outlined above, individual immigrants are invited to the state by individual persons and companies to accept an offer of employment it is because there is a pressing, economic need for their presence – there is a surplus of capital goods and equipment and a shortage of labour. The immigrants, in this instance, will begin work immediately and will mould themselves into the cultural practices and habits of the indigenous population. Furthermore, their skills and abilities, being in genuine short supply, will be recognised and appreciated by their co-workers, with whom they will be co-operating to create more wealth and a greater standard of living, rather than competing to consume an existing stock of wealth. It is true, of course, that immigrants may retain cultural practices of their homeland in the domestic situation of their own home; however, the first generation of children, born in the state to where their parents have emigrated, will become heavily surrounded by its culture. To them, this new state is their homeland and not a foreign place and they will know little to nothing of their parents’ place of origin. Thus they become even more integrated into the culture of the new state and will most likely consider themselves as citizens of the new state even if they retain an obeisance to the state from which their parents emigrated. This is not to imply, of course, that the culture of the immigrants will be completely eradicated. Indeed, in some cases, foreign cultural practices find their way into the indigenous culture. The delights of foreign cuisine, for example, are often embraced by a domestic population, as Indian and Chinese food has throughout the West. All we are saying is that at if social co-operation is to be pursued to its fullest extent, one of the cultures must become recessive and to the extent that the immigrant population form a minority it is likely to be the indigenous culture that remains dominant. The outcome, of course, is a prosperous society where immigrants and natives work together peacefully without racial tension or xenophobia.

Contrast this situation, however, with the case of where it is the government of the state which welcomes immigrants to its territory, either through a policy of open borders or according to some artificial quota system which is wholly unrelated to the genuine demand for additional labour within the state. Here, the immigrants will arrive without offers of employment but they will quickly look for them. However, because there is no demand for additional labour at the existing wage rates the effect of the arrival of the immigrants is to push existing wage rates down for the indigenous population. Thus the latter draws the perception that immigrants are simply creating a crowd, a crowd which competes for existing resources but seemingly does little to add productive value. This becomes exacerbated by minimum wage laws and other costly employment regulations that the state heaps upon employers – if wage rates drop below these levels then unemployment must result. Hence the perception that foreigners are coming over to “steal” jobs from the indigenous population, although both will be afflicted. Moreover, if the immigrants cannot find jobs then it is less likely that they will be integrated into the working practices and the cultural environment of their new state. What results, therefore, is that they form their own communities and their own local economies which, with little impetus to do otherwise, retains the cultural distinction of their homeland. Hence, the perception amongst the indigenous population, that entire towns and communities are being “invaded” by an alien culture and that one’s own homeland is being turned into an outpost of some far and distant country. The stage is set, therefore, for an increase in racial tension and xenophobia, an increase which will be exacerbated if the government follows a deliberate policy of multiculturalism – i.e. the explicit intention to create numerous cultures within the same society where one was previously dominant by inviting immigrants. Multiculturalism has rarely existed under purely voluntary conditions. The only exception is where vast swathes of immigrants from different places move to a previously uninhabited or sparsely habited area. The difference here, however, is that everyone, from wherever they have come, has moved to the new land in order to make a better life for themselves and they are attempting to do so in a place where there are few, if any, indigenous persons of a given culture seeking to preserve an existing culture. Everyone, in other words, is embracing change and the challenges that come with improving their lives, rather than attempting to defend one that already exists. Such was the early history of the United States which, of course, was populated by immigrants from all over the world.

What we can see, therefore, is that policies of open borders and forced integration are the cause of racism and xenophobia through economic and cultural clashes. They are not the solutions to these problems. However, even if there were no economic barriers to welcoming immigrants to a given state and even if the only motivation for indigenous people to exclude them was racism and xenophobia that sprung from their own minds entirely as a matter of preference, our priority is to ensure that all of the six billion people of different creeds, colours, races, and religions are able to co-exist peacefully on this small rock hurtling through space. If different peoples and cultures living in separate geographical locations achieves this whereas mixing them all together in a single place causes them to fight then it is reasonable suggest that preference should be given to the former.

Progressives often label their policy of mixing cultures in the same locale as a policy of achieving “diversity”. Yet the world as a whole already is a diverse place. Some places are hot, some places are cold, some are wet, some are dry, some have fertile soil while some are barren. As we said earlier, this diversity of geography, climate and topography, together with the unique challenges posed by each difference with which humans have to deal, is what creates diverse cultures. The forced creating of “diversity” in every single locale simply amounts to a travesty. Not only does mixing every culture everywhere in every location, in fact, create bland uniformity as opposed to diversity, it is the equivalent of trying to put a mountain, a hot desert, and a jungle all in New York City. To that extent we might say that attempting to create “diversity” is a utopian revolt against nature.


To summarise what we have concluded here:

  • In a world where the existence of states is assumed, the ownership of state property should be approximated to the ownership of the state’s tax paying citizens, thus ruling out a right, in libertarian theory, for non-taxpaying foreigners to cross the border;
  • That invitations to cross the border should be made to prospective immigrants by private companies and individuals;
  • Such a policy would prevent the relative surplus or shortage of labour experienced when the state actively manages immigration policy; labour and capital goods would be channelled, through pricing, profit and loss to where they are most needed;
  • That it is relative surpluses of labour through policies of open borders, forced integration and the pursuit of multiculturalism, which are the causes, and not the solutions to, racism and xenophobia. The prevention of surpluses of labour through the method we described would also prevent such racial and cultural clashes and is more likely to create a world of peace and prosperity for all persons, regardless of colour or creed.

View the video version of this post.

“Brexit” Wins – Where now for Liberty?

Leave a comment

As I am sure everyone is now aware the British people, on Thursday, voted to leave the European Union by a slim majority of 51.9% to 48.1%. Without a doubt this largely unexpected result represents one of the most important, possibly the most important, step forward for liberty in at least a generation, dealing a serious body blow to a major project that sought to centralise and consolidate state power and to weaken the primacy of individual nations and identities. However, while our enthusiasm remains palpable and before the champagne goes flat it is important to judge this outcome in a sober light and to reflect upon how we, as libertarians, can capitalise upon this victory.

As I stated in my essay prior to the referendum, we must bear in mind the fact that the official leave campaign was not a battle between libertarians, or liberty-leaning individuals on the one hand and statists on the other. Rather, it was between small statists and large statists. The contest was not about getting rid of the full house of government horrors – central banks printing paper money, the welfare state, the NHS, and so on – but about national control of the state apparatus versus international control. The populist politicians who will benefit the most from “Brexit” – notably, former London mayor Boris Johnson, who is likely to become the next UK Prime Minister, and US Presidential candidate Donald Trump – may shove two fingers up to the establishment but they are very, very far from perfect and principled characters. Consequently, if they are elected they will soon become part of that establishment and subject to its infiltration. But even if they manage to resist this they may assume they have a mandate to become more authoritarian in their own way. Moreover, the centralising forces that have invested so much in the European project are not going to give up easily. They may have been set back considerably but we can expect them to fight, in the short term by making the stipulated two-year process of withdrawal from the EU punitively painful for Britain, and in the longer term by finding other ways to enact consolidation and centralisation through the back door.

However, let us explore now some aspects revealed by this referendum that provide both something which we libertarians can capitalise on and reasons for us to be optimistic for the future. The first aspect is the sentiment of the voters who participated in the ballot. According to Lord Ashcroft Polls, 43% of those who voted for Britain to remain in the EU did so because “the risks of voting to leave the EU looked too great when it came to things like the economy, jobs and prices” while only 9% voted because they felt “a strong attachment to the EU and its shared history, culture and traditions”. Out of the leave voters, better trade and economic growth outside of the EU was a relatively minor concern with only 6% acknowledging this as their primary reason. However, 49% of leave voters said the biggest single reason for them wanting to leave the EU was “the principle that decisions about the UK should be taken in the UK”. In other words, looking deeper than the overall slim majority in favour of leaving we can see that remain voters voted pragmatically for their jobs and financial security whereas leave voters voted out principle for British sovereignty. If these figures are correct, therefore, the referendum indicates either a complete lack of support for or a downright repudiation of the ideology of centralisation and the merging of individual nation states in a giant behemoth. This is an extremely encouraging revelation for the cause of liberty and one that has seemingly been missed by mainstream commentators.

The second aspect is the reaction of liberal elites to the referendum result, a result that has shocked them profoundly. The prevailing attitude of these people is one that I have detected from conversations with and observations of my own friends and acquaintances, who are mostly young, are either well or highly educated, and are either intellectuals or professionals. This is the attitude that all progress, peace and prosperity, and that all prevailing cultural attitudes emanate from the top down, from a stewardship and management of society and the economy by wise, far sighted elites such as themselves through the apparatus of the state; and, hence, the bigger and more unified the apparatus of the state run by people like them then the more successful and prosperous will be the society it rules. In the same way that great engineers can fashion the tallest buildings, the fastest cars, the biggest planes and so on, so too do these people believe that they can engineer and shape society according to what they believe is virtuous and valuable. What they fail to see is that a peaceful and prosperous society is nothing more than individual people seeking to co-operate to attain ends that they want; that it is individual people with their own thoughts, feelings and desires making their own choices to better their lives; that their attitudes and values are motivated from the bottom up by what is good for them and for their families and friends. The narrow minded, intellectual view has led the elites to interpret the results of the referendum – i.e. rejection of a unity of states – as being a rejection of peace and harmony with the rest of humanity because they cannot imagine a unity of peoples without the unity of states. Indeed, the reaction of one acquaintance to the outcome of the referendum was that she was feeling “apocalyptic”. However, the most pertinent example of this globalist-elitist attitude is in the following reaction offered to the BBC by a young Polish lady:

Seriously Britain? It’s sad that a majority of your people didn’t realise that it’s not a choice…about your no longer imperial country, but about commitment, devotion and enthusiasm of the whole Europe. If you voted Leave, you are selfish and you deserve to watch Scotland saying ‘bye’.

I pity well-educated people of Britain, especially youngsters, that will need to face what the ‘majority’ brought them.


As a person who truly believes in unity of European culture and heritage and supports sticking together against the odds, I feel really disappointed, even personally touched” [Emphasis added]

Another individual expressed regret that we do not have weighted voting – because obviously all of those stupid voters out there in the wilderness do not know what is best for them, an attitude no doubt bolstered by the fact that much of the leave vote came from working class heartlands where the Labour Party is normally strong. What these bright individuals have utterly failed to realise is that people have had enough of “well educated”, morally superior, self-righteous elites such as themselves telling them how to live their lives and forcing them to do it, with the most hubristic and arrogant of them now retreating into their shells because they think the world is about to end without this pan-European state structure that they have designed for us all.

Happily, however, I also sense, amongst some of the smarter individuals within these kinds of circles, a small but glowing realisation that there was, outside of London and the ivory towers of universities, a whole other country from which they were entirely disconnected – attitudes, opinions, thoughts, feelings and desires which they completely ignored. It is this realisation that libertarians should attempt to nurture and grow, an opening into which we can begin to instil the benefits and morality of decentralisation and personal liberty. It will be a long haul but at least there is a glimmer of light.

So while, therefore, I believe that June 23rd is a great day for liberty, there is much work to be done and we should not lose any time in getting down to it.

View the video version of this post.


Britain and the EU

1 Comment

On June 23rd of this year, Britain will hold a referendum on its membership of the European Union, voting either to remain (“Bremain”) or to leave (“Brexit”). The present author is rooting for a “Brexit”, which is unsurprising for a libertarian who detests any metastasised growth of the state that the EU certainly represents. Unfortunately, in spite of the passionate rhetoric that the issue tends to inspire in the so-called “Brexiteers”, from a libertarian point of view it is difficult to reconcile oneself with, or to endorse, some of the arguments that are emanating from the “Brexit” camp. In other words, it would be a mistake to characterise the debate as a defiant band of liberty lovers seeking to shake off the tyrannous ogre of a bloated, continental tyrant, although that is surely part of the motivation. Rather, many of the “Brexit” arguments, seeking to respond to the “Bremain” side, are couched in the same conventional, statist terms. They therefore lack any incisive bite that would provide a convincing case for withdrawing from the union.

The most prominent issues where this is visible are economic growth and trade. When it comes to the former, both sides fling at each other hypothesised GDP figures that show either a marked gain or reduction in the number. Obviously “Brexiteers” are attempting to show that the figures would be higher outside the EU whereas “Bremainers” are attempting to show the opposite. However, simply adding up flows of monetary expenditure (and then expecting the public to comprehend the methods and assumptions involved in doing so) in order to try and get a bigger, magic number than the other guy tells you very little. If you had a billion pounds yet the only thing to spend it on in the entire world was a loaf of bread then you would be in abject poverty in spite of your nominal wealth. The key to encouraging economic progress is increased investment in capital goods such as factories, machines and tools developed with ever better technology, which permits more consumer goods to be produced per worker, thus lowering prices and making more things affordable for everyone. The kind of economic system that best incentivises this accumulation is one of strong private property rights, minimal regulation and minimal taxation. GDP figures can be high in spite (or even because) of the fact that these things may be absent, as it is buoyed by monetary inflation and government spending. The relevant question, therefore, is whether the EU is likely to either promote or discourage this kind of environment. Instead of arguing over GDP projections the answer that “Brexiteers” should be giving is that the consolidation of states makes it more likely that property rights will be diminished while taxes and regulations rise. Smaller states do not usually possess within their territories all of the resources they need to build a strong economy. In much the same way as a single household or individual needs to go shopping at the grocers, the butchers, the bakers and so on, so too does an individual state need to go “shopping” in other countries, trading what they have for things they do not have. Burdensome regulations simply discourage this trade, while high taxes and insecure private property rights will deter foreign investment, all of which will seek more favourable markets as a result. Moreover, if the state becomes too onerous it is far easier for citizens of even modest means to leave a small state than it is for them to leave a larger state. Large, consolidated states, on the other hand, usually have access to a wide labour market and a greater number of resources, and are better equipped for a degree of autarchy. Moreover, the large state’s sheer, geographical size makes it more difficult for a citizen to emigrate to a similar country which is unaffected by the large state’s diktats. The large state will therefore step up its plundering of the citizenry as it is shorn of any real impetus to cease doing so. What produces trade and economic progress, therefore, is not consolidating states into one giant monopoly, which has a reduced incentive to relax its depredations upon its citizens. Rather, it is allowing states to compete with each other to attract entrepreneurial migrants, investment and trade. In other words, while creating a trading block may give the appearance of vanquishing border controls, tariffs and other trade restrictions it does not stop the trading block from imposing internal taxes and regulations that are more burdensome to trade and prosperity than those between independent states. Indeed, a high rate of internally imposed Value Added Tax (VAT) can be worse than a tariff. And, as the “Bremainers” trumpet, while it is true that within a single market companies no longer have to deal with a myriad of different tax rules, different regulatory codes, and so on, it is likely to prove less costly in the long run to deal with many light and fleeting taxes and regulations than it is to deal with one behemoth. Just to give an idea of how big and bloated the EU bureaucracy is, one source (Brexit: The Movie) lists a whole host of household items one encounters between waking up in the morning and eating breakfast:

  • There are 109 regulations for pillows, and 50 for duvets and bed sheets;
  • 65 EU laws cover bathrooms;
  • 31 for toothbrushes and 47 for toothpaste;
  • 172 laws for mirrors, for some reason;
  • 91 for showers, 118 for shampoo, and an incredible 454 for towels;
  • At the breakfast table, there are 1,246 regulations for bread, 52 for toasters, 64 for fridges, 99 for cereal bowls, 201 for spoons, and 625 for coffee;
  • Far ahead, however, is milk which has been deemed to deserve an incredible 12,653 EU regulations.

None of this is to imply, of course, that a world without the EU would be wholly unregulated. Rather, regulation will come from the market place and it is consumers who will decide whether products should meet certain standards. Moreover, increased quality and better safety comes about through the wealth creating endeavours of free individuals so that these things become more affordable, not through the wealth distributing fiat of faceless bureaucrats in Brussels.

Concerning specifically the issue of trade is the argument over whether Britain would, outside of the EU, be able to negotiate so-called “trade deals” without the backing of the EU. In his final visit to the UK as President of the United States, Barack Obama indicated that Britain would be “at the back of the queue” for trade deals owing to what is presumed to be its diminished influence outside of the EU (although this attitude did not stop him, in the same trip, from preaching to an audience of young gullibles an instruction that they should “reject pessimism and cynicism”). The response of “Brexiteers” has been to try and demonstrate how trade agreements would, in fact, be possible and how Britain would open itself up to being able to deal with other large markets, such as China and India, independently. While the latter is certainly true, all of this is wide of the mark. For trade agreements between states are precisely what we wish to avoid. Trade agreements do not open up trade at all; rather they stifle it. Genuine free trade can be accomplished by adhering to a single principle that can be written in a single, short sentence: no restriction of trade across borders. Trade agreements, however, which frequently masquerade as free trade agreements, are simply government managed trade. The North American Free Trade Agreement (NAFTA), for instance, runs to more than 1,200 pages across two volumes of government imposed rules and regulations, usually in order to grant protectionist privilege to a handful of powerful firms and interests. Indeed, one of the motivations for “Brexit” is for Britain to avoid the Transatlantic Trade and Investment Partnership (TTIP) between the EU and the US, which is seen as giving too much power to overseas corporations and ignoring environmental concerns. However, “Brexiteers” do not augment this rejection of a specific trade agreement to a rejection of trade agreements as a whole. One possible retort to this argument is that, in the absence of any kind of trade agreement, other countries could simply whack enormous tariffs and regulatory burdens on imported British goods, almost like some kind of punishment. In the first place it is, of course, far-fetched to believe that every one, or even most, of the significant markets with which British companies trade would do this. If a state shuts off or otherwise burdens trade from another state it ultimately harms itself as much as it harms the state upon which it has imposed the restriction. For if, prior to the elevated tariffs or increased regulations, certain resources or products were purchased from Britain it is because Britain produced these products at the best value compared to anyone else. Therefore, after the restrictions, the citizens of the other state must now pay more to produce the same goods internally or buy them from an alternative state, or must be content to purchase goods of lesser quality. Moreover, shutting off imports weakens a demand for a state’s exports as ultimately all imports are paid for with exports. It would, therefore, be foolish for states to respond to a “Brexit” in this way. The same argument applies to the EU itself. Another of the arguments from the “Bremainers” is that if Britain left then the EU would still be Britain’s largest trading partners with the power to impose its regulations on trade entering the block, in addition to newly imposed tariffs. Britain would be shorn of any influence whatsoever to change these rules, and would end up in much the same condition as some of the proximate outliers such as Switzerland and Norway are alleged to languish (never mind, of course, that GDP per capita in those countries is markedly higher than in every EU country). In the first place this argument shows just how few clothes the emperor is wearing. On the one hand, the EU is supposed to be committed to promoting trade and commerce yet on the other hand, if you dare to leave it, you will be shut out by tariff walls and have to suffer whatever burdens the EU rains down upon you. Clearly, therefore, the EU is far from being a promoter of peaceful trade and prosperity. Rather, it is really nothing more than a protectionist club, like a gang of bullies in the school yard who look after each other yet terrorise the other kids. That aside, however, Britain’s “influence” does not come from its membership of the EU – rather, it comes from the value that the EU places on its partnership with Britain, which will ultimately boil down to Britain’s economic clout. If trade with Britain is valuable to the EU then Britain will have as much real influence outside of the club as it does inside; you do not stop talking to someone you need simply because you are not in a political union with them. If, on the other hand, Britain was a tiny, unproductive state that produced little then it would be ignored as a member of the EU just as it would be largely ignored as outside. That is why the larger, more prosperous states in the EU, such as France and Germany have most of the influence. Most of the arguments concerning the loss of any “influence” for Britain, both within the EU and on the so-called “world stage”, do not refer to the diminished influence that the average British citizen would have in improving his life and furthering his goals. Rather, it refers to the diminished influence that the British politician will wield following “Brexit”. Being a representative of a large territory such as the EU gives the state’s lackeys a much more prominent position at the table when they jet off, at taxpayers’ expense, to their plush conferences and summits to devise an ever increasing number of predatory ways in which they can burden the real wealth creators. In any case, however, the “loss of influence” argument seems to have received the final nail in its coffin in early May when it was alleged that Germany had a de facto veto over Prime Minister David Cameron’s renegotiation of Britain’s terms of EU membership. However, even if we imagined the worst case scenario where all of the countries of the world, including the EU, imposed punitively high tariffs and onerous regulations on British imports and refused to engage with Britain in any way shape or form, the latter would still benefit from making a universal declaration of free trade – no tariffs on imported goods and little or no regulation. This sudden reduction in cost would then make Britain a highly competitive market, reducing costs of inputs for British businesses, attracting investment, expanding output and lowering prices for British consumers.

Looking more broadly, what are we to make of the argument that the EU was the supposed solution to centuries of war and human rights abuses? Strictly speaking, the human rights obligations of European states depend not so much upon the EU but, rather, upon whether they sign up to the European Convention on Human Rights (ECHR), which dates from 1953. The Convention is used as a convenient short hand for states to demonstrate their commitment to human rights, which is a condition of EU membership, and jurisprudence from the European Court of Human Rights normally plays an important role in determining how member states should implement EU law in accordance with their human rights obligations. Nevertheless, even though, as libertarians, we must be suspicious of any kind of government implemented human rights charter, which simply cherry picks certain pleasantries, subjects them to state regulation, and calls them “rights”, it would be possible for a member state of the EU to leave and still remain a party to the ECHR. Somewhat perversely it is, in fact, prominent “Bremainers”, such as Home Secretary Theresa May, who are campaigning for Britain to withdraw from the ECHR while remaining in the EU. The possibility of war however, is an important issue, with Mr Cameron himself having argued that leaving the EU would increase the risk of Europe descending into war. In the first place we have to wonder why, if the situation was that grave, Mr Cameron’s commitment to the EU was so ambiguous before he achieved his so-called “reform deal”, which renegotiated Britain’s EU obligations in areas such as welfare and immigration. Prior to this he supposedly had no “emotional attachment” to the EU and at least gave the impression that he may campaign to leave if the reforms failed. Mr Cameron was effectively saying that if he was devoid of an “emotional attachment” to the EU he was also devoid of an “emotional attachment” to avoiding war, the latter of which is surely more important than tweaking the conditions of EU membership. That aside, however, we have to wonder what this argument – the possibility of European war – makes of the so-called “democratic peace theory”. This is the idea that democracies are less likely to go to war with each other, and is peddled by pretty much the same people who crow for political unity. Weren’t the continent’s wars started by despotic monarchs and crackpot dictators? Surely now that we all bask in the bliss of democracy we won’t be so eager to fight each other? Why do we need something more? Regardless of this, however, the argument that a diminution of the EU will lead to war is ridiculous – indeed, it is the opposite that is more likely. Wars are started and fought by states; human rights are abused by states; the state, in the twentieth century alone, caused more deaths than private criminals in the whole of human history. Even the greatest efforts of sub-state, politically motivated actors – i.e. “terrorists” – pale in comparison to the carnage and destruction wrought by states. If this is true, it stands to reason that the solution to preventing this is to make states smaller and weaker, not bigger and stronger. The most destructive, and most potentially destructive conflicts we have ever experienced – the two world wars and the Cold War – occurred after the consolidation of smaller states into large territories, namely Germany, Italy and the Soviet Union. The origins of both of the world wars is complex, of course, but a fundamental cause was the drive of the unified Germany towards autarchy. As an industrialised country, Germany relied upon the import of food and the export of manufactured products in order to pay for it. The costs and burdens heaped upon German industry in order to fund the Bismarckian welfare state hampered German production, leading to fewer exports and fewer imports of food. Thus Germany looked to conquer the agrarian lands of Eastern Europe to overcome this self-inflicted handicap. What is clear, however, is that this problem was facilitated by the unified state, which was endowed with the wherewithal to grow the depredations of the state upon its industry and the might to launch invasions. Later, the persistent nuclear terror that was extant during the Cold War was made possible because territories as large and as rich as the United States and the Soviet Union could afford to fund things such as the Manhattan Project. The most aggressive and belligerent state today is the United States, which, together with its fawning collection of NATO allies, is driven by the neoconservative foreign policy agenda that seeks a unipolar world of American dominance. The greatest threat to peace is that such ambitions emanating from a large, rich and powerful state run head first into the ambitions of other large, rich and powerful states – namely, China and Russia, as we are seeing lately with the expansion of NATO to Russia’s border, the demonization of the Russian president and the altercations in the South China Sea. The worst case scenario is that the world will be vaporised in a nuclear holocaust, something which is likely to get worse if the next US President, who will be elected in November of this year, continues down this path. It is clear therefore that the consolidation of states may reduce the number of potential warmongers – but the stakes are far, far bigger. The key to achieving peace and prosperity is free trade in a sound money environment. You do not have to point a gun at your butcher or your baker in order for him to hand over what you want; you simply have to offer him something that he wants and then you both get on with the rest of your day. Exactly the same is true on a global scale; individuals engaging in voluntary exchange without interference across borders will not fight each other. War and conflict result only when states infringe this harmony.

This leads us on to the so-called “democratic deficit” argument – the idea that the EU’s governance and institutions somehow lack democratic legitimacy. It is true that if the EU is perceived as beyond the control of the voters then tolerance for it will dissipate quicker than if they believe they are “having their say”. On the other hand, however, democratic legitimacy is something of a red herring. People possess a de facto control over the state, with or without democracy, the smaller and more local it is. Even if the EU reformed all of its institutions in order to eradicate the “democratic deficit”, the EU would remain as a vast territory in which the individual voter vanishes into an ocean of 500 million others and its institutions would still amount to a vast bureaucracy awash with special interests that speak umpteen foreign languages making it impossible for the voter of any individual country to understand precisely what is going on. This can point can be made without us having to resort to the wider libertarian critique of democracy as an enabler of, rather than a restriction upon the state.

In drawing all of what we have said together, we will conclude with an observation that is likely to resonate with libertarians. When it comes to the big issues such as economic progress, trade, and promoting peace and prosperity, all of the arguments in favour of the EU boil down to the assertion that the EU makes it easier to get rid of state imposed restrictions and to vanquish ills that are created by the state. In other words, the EU is supposed to be good not because it actually achieves a positive accomplishment over the restrictions imposed upon humans by nature (such as a new product or service), but because it clears away artificial roadblocks that states have put in the way. If this is true, perhaps it would be better to address the question of whether we need the state at all, rather than whether we need a giant one such as the EU.

The Nature and Origin of Rights, Part Two

Leave a comment

In part one of this two-part series of essays we explored the difference between treating social phenomena such as rights, obligations, rules, laws and conflicts as products of human interaction on the one hand and as products of explicit human construction on the other. In this second part we will proceed to explore precisely how the constructivist-rationalist approach to social phenomena came about and how devastating it can be to individual liberty when it infiltrates political philosophy. From this we can learn some important lessons when it comes to developing and shaping our own libertarian theory.

Generations after customary legal systems developed through social interaction, philosophers began to reflect upon this phenomenon, a reflection which, for Western purposes, began with the Ancient Greeks. In accordance with our view here, the purpose of this endeavour should not have been for philosophers to treat these matters as a tabula rasa on which to scribe whatever they thought was the most convincing and compelling case for a system of rules. Rather, it was to clarify that which was already occurring and to make explicit a conceptual framework that was already implicit. Indeed, as we stated earlier, this is common among most human endeavours – science, art, mathematics, economics, language and so on all flourished before we stopped to think about what we were actually doing in each of them. The fruit of this reflection was to distil from legal systems common elements such as conflicts, legal personage, property, rights, obligations, malum in se and some kind of understanding of natural justice. Thus, there existed principles that appeared to transcend expediency, self-interest, and the particular time and place, in spite of the fact that individual conceptions or realisations of those concepts differed. In other words, they were principles that were not just fashioned by leaders, intellectuals, or by “society” but spoke from some kind of universal plain. (This point should not be understood as a refutation of legal positivism. Rather, it simply says that the conceptual framework of legal systems – including the nature of a conflict and the rights and obligations that ensued – were not something that were designed and imposed).

However, this process of reflection and elaboration did not occur in a vacuum, and was (and still is) considered alongside a whole host of other philosophical problems such as knowledge, existence, morality, aesthetics, and so on. In the consideration of “the rules of conduct” there was a distinct overlap between what we might call political philosophy (broadly, what a person can be forced to do) and wider morality (that which a person should choose to do), an equivocation which has persisted to the present day. The process of identifying appropriate conduct – anything from morals, etiquette, manners, the attainment of beauty, happiness, and so on – always and necessarily involves elaborations on how rational actors should choose to behave with and towards non-rational beings/objects and towards other rational beings alike. When a proponent of certain moral rights and obligations overlaid these considerations onto the development of the understanding of legal rights (i.e. rights that could be enforced by violence) what resulted were systems of constructed conflicts, constructed rights and constructed obligations which never arose out of any interactions between individual parties.

If libertarians are to ever find the key that unlocks the door to a world of liberty, it is very important for them to understand the extent of the effects of this kind of endeavour and how it has served as the basis of countless numbers of despotic political theories. When someone constructs or proposes a system of rights and obligations and to prescribe legally enforceable rules of conduct, the result was not to engage in the process of “identifying” conflicts that exist between two other beings or objects; rather, it was to identify a conflict between himself and the particular person upon whom he claimed had an obligation. The conflict was a clash between the proponent’s values and the values of another or other individuals. In other words, the proponent sets himself up as the legally aggrieved party and bases the outcome of law and adjudication on some kind of a conflict between himself and somebody else who was behaving in a manner the proponent simply happened not to like.

Let’s say that there are three people Andrew, Bob and Charlie. Andrew and Bob are two people who live and interact in a society. Charlie, on the other hand, is a philosopher who looks upon the condition of A and B and decides for himself that Andrew owes a certain obligation to Bob. Let us say that, in order to create some kind of just and equitable society, Charlie declares that Bob should have the right to £100 of Andrew’s income every month. Andrew is therefore now burdened with an obligation of furnishing money to Bob, who now possesses the right to take this money from Andrew with the full backing of the force of law. However, the real right claimed in this situation is not by Bob. Andrew and Bob may have been perfectly happy before Charlie came along; Bob may have been content with his own income and coveted nothing that Andrew possessed. Rather, the real, substantive right is claimed by Charlie. It is Charlie who does not like the situation that Andrew and Bob are in – it is he who despises the existing property arrangements between the two. What Charlie is therefore claiming through his proposal is his right to go to court every time some action he does not like has occurred and to invoke his right to have this action stopped (or conversely to force an action that has been omitted). This desire of Charlie’s is masked in the language of providing justice and fairness for Bob, whereas Bob, in his own mind, never conflicted with Andrew at all and never had reason to invoke a right. The conflict originates wholly in Charlie’s mind.

This becomes clearer when Bob is not another competent adult but is, rather, an animal or an object. An object – let’s say a tree – as far as we know lacks any appreciation of ends, values and choices, and cannot understand any alternative situation as better, beneficial or valuable. Without being able to perceive value or any preference of ends the crucial element for the source of a conflict with another individual is missing. If there is no conflict then there are no rights and obligations. It is for this reason that we owe rights to rational beings who think, value, choose and act but we do not owe rights to non-rational beings and objects who are utterly devoid of these capacities. If, therefore, Charlie comes along and says “This tree has a right to not be cut down” and that, consequently, Andrew has an obligation to not cut down the tree, it is clear that the real conflict over the state of the tree is not between Andrew and the tree; it is, rather, between Andrew and Charlie. The tree has no capacity to care whether it is remains standing, is cut down, or is burnt to the ground. It has no values, no choices, no ends. Rather, it is clear that the person who values the tree remaining upstanding is Charlie. Charlie is seeking, by declaring a pseudo-right for the tree, a real right for himself to have his values vindicated and for Andrew to yield to these values. In short, Charlie wants to force Andrew to comply with what he, Charlie, simply wants him to do.

Usually, theories such as those of Charlie do not confine themselves to individual cases such as that of Andrew and Bob, or Andrew and some object. Rather, Charlie is normally the proponent of a much wider theory of social behaviour as he perceives a conflict between his values and the values of practically everybody else. In other words, he is claiming his right to force everyone else to conform to his grand vision of society. There can be no greater example of this kind of reconstruction of sociological concepts than that furnished by Karl Marx through his espousal of the so-called exploitation theory. Marx analysed the voluntary capitalist/employer relationship according to the equivalence of its surface phenomena with those of previous non-voluntary relationships such as serfdom, explaining the motivations, mechanics, and outcomes of this relationship with a series of fictions such as the harmony of class interests and distortions of several tenets of classical economics. From this, his labour theory of value leads to the conclusion that employer’s profit is “surplus value” appropriated from the labourers. Marx himself was careful to explain his theory as a scientific, economic theory that must be properly refuted in a scientific manner. However it is clear that he is inviting the specifically ethical conclusion that profit is theft, a conclusion to which his followers so willingly succumbed. The question of whether Marx’s scientific conclusions were the slave of his political preoccupations rather than vice versa is debatable. Either way, however, we can see that the effect of Marx’s de facto reinvention, his deliberate reconstruction, of the concept of theft was to urge the establishment of a property order that he desired – the abolition of the private ownership of the means of production – rather than that desired by everyone else. In short, he invented a conflict between two great swathes of the population that was not in any way perceived by the parties themselves. This theory, this constructivist intrusion into social phenomena, went on to enslave half of the globe for nearly a century and resulted in the deaths of tens of millions of people. This trait or technique of reconstruction was not limited to Marx, however. Indeed, pretty much every significant contribution to socialist theory which denigrated the capitalists and entrepreneurs as thieves and parasites was made by middle class onlookers and observers; the working class themselves did not seek any right to protection from any alleged “theft”. So too did the backlash against the conditions of industrial workers in the nineteenth century receive its main championship from middle class intellectuals such as Charles Dickens, Lord Salisbury and Sidney and Beatrice Webb – busybodies who fought for people’s so-called rights without ever stopping to think whether or not those people wanted them. This is not to say, of course, that workers – the constructed rights holders – would not have willingly championed the apparent invocation of “their” rights. After all if someone comes along saying you can effectively have your cake and eat it you are hardly going to complain. This can be seen clearly today with the advocacy of minimum wages. Employees are lulled into thinking that there can be higher, nominal wages and plenty of jobs to go round whereas economic theory tells us that floors on wage rates are likely to lead to a shortage of available jobs and, hence, unemployment. If, however, you understand the concept of demonstrated preference – an “Austrian” insight that informs us that people’s valuations are revealed by how they act and not what they say – you would realise that their actual valuations were otherwise and they are, in fact, perfectly happy to accept full employment with lower wage rates, or “poor” working conditions. Anything they say otherwise amounts to little more than wishful thinking or whimsical dreaming of an alternative but unrealisable reality.

It is true, of course, that constructivist political theories may be motivated by a genuine concern for and desire to help people. But whether this is true or not any political theorist is rarely honest enough to say that his vision simply imposes his values upon everyone else. Usually this imposition is disguised through a convolution of pseudo-concepts and dogmas, the “exploitation theory” in Marx probably being the most prominent. Other noteworthy examples are the so-called “original position” and “veil of ignorance” in John Rawls. People in the real world do not want the kind of ethics that Rawls espouses so he has to invent a fictional world with fictional situations and fictional motivations in which they do. Indeed Rawls is blatant enough to admit, in A Theory of Justice, that he fashions these pseudo-concepts in such a way as to give him the answer that he wants. Such reconstructions and reinventions are evident, though, in pretty much all collectivist philosophies in which society is deemed to have “failed” to direct its resources in ways demanded by the theory’s proponent. It is evident too in all claims of so-called “market failure” – that the choices of purposefully acting individuals have gravely decided to devote their resources to some feeble end rather than to something “better” and “higher” that exists in the mind of the proponent. Furthermore the imposing party is never starkly identified as being the proponent himself, but, rather, his proxy the state (even if the goal is, like that of Marx, an eventual withering away of the state). It is the state which is tasked with bringing the ends desired by the proponent into being so that what results is that the state itself becomes the true rights holder and everyone else is obliged to succumb to the state’s self-enforcement of its right to bring about the proponent’s vision. Any people who happen to benefit from this, although they may be described as “legal rights holders” (for example those who have a “right” to claim state unemployment and sickness benefits), do not possess any real, fundamental rights at all but are, rather, incidental beneficiaries. In modern democracies, Charlie, the philosopher from our example earlier, is not any one individual but is, rather, the majority, who claim the right to force everyone else to adhere to that which they want (assuming, of course, that democracies really do enact the ends sought by the majority, which is highly doubtful). This majority may have a revolving membership from issue to issue or from election to election but the principle is the same as when that which is desired and imposed upon everyone else originates in the mind of a single person such as Charlie.

Unfortunately, and of more direct relevance to libertarians, none of this changes with libertarian and proto-libertarian theories that are themselves motivated chiefly by the desires of their proponents – that the free market will rapidly increase societal wealth by more than we can imagine; that it makes for an affluent and prosperous society; that humanity will achieve its greatest, hitherto unimaginable endeavours, etc. These theories usually have the benefit, unlike collectivist theories, of actually being able to accomplish their aims. However, their weakness lies in the fact that they accept the same basic premise as all the other theories, which is that the desirable goal is that which is posited by the proponent of the theory. All of these proto-libertarian theories set up the wellbeing of “society” as the ultimate aim; freedom of the individual is only the means of achieving society’s betterment. By defining liberty in this way, no genuine, fundamental rights are conferred upon the individuals and they are flimsily contingent upon their contribution to the goal. In other words, the possibility, however unlikely, is left open that if the goal could be achieved through some way other than the free market then these rights and freedoms could be withdrawn. For example, if we discovered, by magic, a way to make central planning the most conducive method of generating economic progress then any libertarian theory which promoted freedom based on its ability to raise the standard of living would crumble to dust. Yet no doubt most libertarians would say that one possesses a right not to be murdered or stolen from regardless of whether such acts would increase or decrease the number of yachts we can each buy. The more basic problem, however, is why should conflicts be recognised with reference to any goal espoused by the proponent of a theory rather than with reference to all of the millions of goals and purposes that individuals strive to achieve? Man is a social animal, as the well-worn phrase goes, but he only participates in social co-operation to the extent that he feels he derives a benefit from it, whether this is material or simply a desire for companionship and friendly relations. Society, the growth of the division of labour, increasing capital accumulation and a rising standard living are the result of each individual person fulfilling his individual purposes through social co-operation; they are not the initial purpose themselves. Such a point is often countered by the argument that people should promote society if they wish themselves to flourish. Ludwig von Mises, for example, speaks of “rightly understood interests” which, in a footnote, he describes as “interests in the long run”, an ethical goal later adopted by his colleague Henry Hazlitt – interests which can only be fulfilled by preserving social co-operation under the division of labour. Although this is a far cry from imposing upon people their own lofty ends as other philosophies are wont to do, it overlooks the fact that people have a variety of localities and time spans, short and long, in mind for their own individual purposes. A person could be completely and utterly educated about the effects of the free market and totally convinced that these effects would be true. Yet it would not be inconsistent for him to still desire goals that we would regard as evil but would not have a destructive effect upon “society” (killing a single individual, or individuals based upon a common characteristic such as skin colour for instance); nor could anyone stop him from desiring goals that are detrimental to “society” only in the long run, perhaps after the particular individual himself has died; still further, however, he could have goals that confer a benefit in the short term and a detriment in the longer term, even to himself (such as smoking, for example) and he may be perfectly happy with this situation. And finally, he may desire goals even in the short run such as greater equality, and reduced affluence and materialism that are completely contrary to ends created by the free market. At the extreme, ecological fundamentalists pretty much want to decimate the entirety of the human race, including themselves, in order to preserve the sanctity of the natural world. Hence one cannot, in these instances, even invoke the golden rule or dismiss them as cases of special pleading.

None of this should be understood as a denigration of proto-libertarian theories which are often, on their own terms, entirely correct and certainly add moral weight to a case for freedom. They do, however, lack moral decisiveness. They are reduced to confronting collectivist theories with arguments about which purpose is better (or which means for fulfilling an agreed purpose are better), and only, at the very least, give the appearance of recognising that the real problem is, in fact, how to reconcile all of the billions of purposes of individual people.

It is true that if we were to refrain from indulging in any constructivist ideology which create rights and obligations fashioned by their proponent then this would not, in and of itself, be sufficient to generate strictly libertarian rights. One also has to explain why, for example, when a conflict is genuinely perceived by individual people, it must be answered in favour of the original property owner. But ascribing rights only to those who seek the valuable ends that their invocation brings about – a province exclusively of rational actors – considerably narrows the field by revealing competing theories for what they really are – the forced distribution of property according to ends valued by the proponent, together with the subordination of all of the billions of desires and purposes of individual people to the desires and purposes of the proponent.

We can see therefore that the greatest threat to liberty throughout history has been the redefinition and reconstruction of ideas and concepts that had a sociological origin. Concepts such as rights have been twisted and distorted from serving as vindications of the ends sought by individual people to serving as vindications of the ends sought by the authors of grand visions of society, visions which have, when implemented, resulted in poverty, destitution and societal degradation. In some ways this is just a more subtle version of the more explicit redefinition of a host of other concepts. A liberal used to be the equivalent of a libertarian; today, wearing such a badge would declare oneself as a socialist. If one is now a free trader, one is actually in favour of managed trade. Liberty is now social democracy, and so on. Even what is “human” has been redefined, through the exploitation of sub-categories such as races and ethnic or language groups, in order to justify ethnic cleansing or genocide on the grounds that the victims are “sub-human” or “vermin”. All of these are simply starker versions of the same constructivist methodology – the attempt to change the underlying reality of concepts to suit their own purposes. To embrace this kind of constructive rationalism, as Hayek called it, is of the same ilk as empiricism and positivism when applied to the social sciences – gross epistemological errors which vastly expand the scope of plausible social theories and lend credence to all manner of attempts at social engineering.

What can we, then, as libertarians learn from this when attempting to develop our own political theory? The most important lesson is that libertarianism is limited to distilling, from the phenomenon of social rules, basic, formal characteristics of these rules rather than their substantive content when they are concretised into actual legal rules that prevail in society. We might call these conclusions high-level political principles and concepts, an order higher than the actual legal rules that we are required to follow in our everyday lives. Some of the conclusions that we can draw legitimately are as follows:

  • Social rules arise to resolve conflicts born out of scarcity of means for attaining ends;
  • That rights and obligations apply to rational actors who possess the qualities of perceiving value, thinking, preferring, deciding, and acting to bring about a more favourable state of affairs;
  • Non-rational actors do not possess rights and obligations – they possess no ability to display moral choice nor the capacity to consciously prefer an alternative state of affairs; key requirements for rights – a perceived conflict and the ability to choose an alternative state of affairs – are therefore missing.

We are not going to proceed to justify these observations here, something which we have already done in an earlier series of essays on the scope of morality. Our concern here is to emphasise that these observations arise out of a reflective process upon the nature of social rules – we are attempting to describe a reality that is already there and not to construct circumstances that are new. When, having made and reflected upon these observations, we continue to define the uniquely libertarian content to social rules this too must also be stated in purely formal terms:

  • A rational actor has the right to own the matter that constitutes his body;
  • A rational actor has the right to own private property;
  • Consequently, no rational actor may invade, physically, the body or property of another.

Again, we will not attempt to justify these conclusions and will simply assume that, as libertarians, we all hold them to be true. Here, however, comes the crunch. What cannot be done is for pure, libertarian theorising to flesh out these formal rules with substantive content. In other words, we cannot, through theory alone, determine which situations are conflicts that need to be resolved. We cannot, by mere philosophising, identify precisely which beings are rational actors and are subject to rights and obligations, nor do we know precisely which actions are aggressive and which are perfectly peaceful. These questions are and always will be the product of the individual values, desires and the resulting perception of scarcity that arises when the means for fulfilling these values clash with those of someone else, factual situations which cannot be determined a priori. In most cases, the obviousness and typicality of aggressive behaviour answers the question for us. For example, stabbing another person in the heart is almost always an aggressive act whereas sitting motionless in your living room chair is not. It would be a mistake, however, to assume that these conclusions are determined by theorising. It is only because the ends that people seek through scarce, physical means clash when one is stabbed by another, and it is only because they do not clash when you sit quietly by yourself in a chair that we know stabbing someone is aggressive behaviour and that sitting alone is not. Whether there is such a clash of ends can only be determined by real people acting in the real world. If we lived in a bizarre world where stabbing another person was perfectly acceptable and everyone was, in fact, happy to receive a brutal stabbing then this would not be aggressive behaviour.

All of this becomes clearer when we consider borderline cases or cases where a typically aggressive act consists of the same kind of behaviour as an aggressive act. For example, the light from a person’s living room window that shines onto neighbouring properties at night is probably not aggressive behaviour, yet if the person was to illuminate his property like Times Square then it probably is. However, both acts consist of basically the same thing – light beams emanating from one person’s property onto another’s. So why is the first act peaceful whereas the second act is aggressive? How bright do the lights have to get before non-aggressive behaviour becomes aggressive? The answer is because nobody, typically, perceives any interference with their own property when you merely have your living room lights on at night, whereas they probably would perceive such an interference if you were to coat your house in flashing, neon lights. Again, the distinction between one and the other rests on the ability of humans to fulfil their ends with the property in question. If each person can go about his business in the belief that he is not being interfered with by another then there is no aggression, even though we may each be experiencing acts which are of a similar, but diminished nature to aggressive acts. Ethics are the product of human action (or, rather, interaction), and all human values that motivate this action appear in discrete concrete, steps – not infinitely small, indiscrete steps which can only be measured by scientific instruments. For example, if I am thirsty and to resolve this thirst I drink 0.00001% of the water in a small glass it is not very likely that I would feel myself to be 0.00001% less thirsty then I was before. Rather, after having imbibed such a useless and imperceptibly small quantity of water I am still, in my mind, fully thirsty and am in exactly the same position as I was before even though, scientifically speaking, the quantity of water in my body has increased. Given that ethics also depend upon human valuations it is no surprise that ethical distinctions are neither surgically precise nor infinitely small.

Is it the case, then, that libertarians are all at sea when it comes to determining the practical questions of precisely which acts are aggressive and which situations are conflicts that are resolved by libertarian rights? Can a libertarian justice system develop no jurisprudence whatsoever concerning which situations are unlawful and which are not? It is true, as we argued in an earlier series on libertarian legal systems, that courts must look to the actions of the parties in order to determine their values and intentions when judging the particular incident at hand. Actions, however, cannot be judged in a void. Rather, they are always interpreted according to their customary, conventional and social context. Over time, as a legal system develops, we can understand readily that the situations which come before courts or adjudicators again and again will be of the same ilk. In other words, courts will come to realise that certain situations are typically viewed by people as aggressive and other situations are not. It is this that provides for them the key to concretising the political principles we outlined earlier – that is, the right to self-ownership and to private property – into substantive legal rules that prescribe the precise situations that violate these principles. Let us take, for example, the deliberate killing of another individual. Although it is, in a hypothetical world, perfectly possible for everyone to be perfectly happy to be killed, our experience and the experience of the court in the real world informs us that in the vast majority of instances people do not, in fact, wish to be killed. Therefore, killing someone is, at the very least, presumed to be an aggressive act in all instances and (if it has been established beyond a reasonable doubt that the defendant killed the victim) the burden falls on the defendant to adduce otherwise. In other words, the victim of a typically aggressive act does not need to prove to the court that the act in this particular situation was aggressive. Let us take, as a further for example, an alleged theft. People, typically, do not want their things to be stolen. If B asserts that C stole from him an item of property the court will hold that this act was prima facie aggressive if B can establish a prior title. However, if C can produce evidence of a superior title, such as a valid receipt for the goods that he took, then he rebuts the presumption.

It is for this reason that acts which consist of minute but generally innocuous physical invasions upon another individual’s person or property are not considered to be aggressive in all instances, even when one party genuinely feels as though his property has been invaded. Earlier we mentioned the case of light from a lounge lamp emanating from a window onto another person’s property. This happens to all of us; if we look out of our windows at night onto the street we can see dim light’s from all the other houses. Most people do not give this a second thought as it does not interfere with their ability to use their own property. If, therefore, someone came before the court and alleged that such an act was aggressive, the court is likely to reject the claim simply because certain types of minor and virtually imperceptible physical invasions are deemed to be socially acceptable. And if the plaintiff has a particular susceptibility to the minor invasion then the burden should fall upon him to protect himself from it, and not upon someone else who is simply going about his daily business.

Other legal rules will be designed to sift out genuine conflicts from mere grievances after the fact. One of the justifications for statutes of limitations is that the elapse of an extended period time before initiation of a lawsuit is evidence of the fact that there was no real conflict. For example, if noise emanates from a neighbour’s property onto my own and I choose not to pursue a case against the neighbour within a certain amount of time stipulated by the court then the court may conclude that this elapse of time is evidence that that the noise was not perceived by me as invasive and I am not entitled to recover damages (such a fact may also be construed as evidence that I have granted an easement right to my neighbour to continue making the noise, so that not only can I not recover damages for the previous noise but that the neighbour can go on being noisy also – but this is a separate issue).

Legal rules begin to lose a degree of steadfastness and certainty where it is difficult for the court to establish objectively the relationship between the parties. One of the most pertinent examples in this regard is the crime of rape. The conflict inherent in rape is the lack of consent to sexual intercourse by the penetrated party. Yet establishing objectively whether such consent was either present or absent is fraught with difficulty because lawful sex and unlawful rape often emerge from similar circumstances and consist of the same physical act. Because of the traumatic and, often, life changing results for both a genuine plaintiff on the one hand and a falsely accused defendant on the other, any evidential rules that are determined are likely to be heavily contentious. Yet it is here where the influence of the shifting sands of the social context are most visible. When society was heavily patriarchal and placed a moral responsibility upon females to uphold their sexual virtue, the burden was upon the victim of an alleged rape to prove to the court that she had not consented to the sexual act. Indeed, at one point the law did not even recognise a forced, sexual act as rape if it took place between husband and wife. Nowadays, however, after women have gained a greater degree of social equality with men, we can see at least a creeping movement that places an increasing amount of the evidential burden on the accused to establish that consent was, in fact, present, rather than on the alleged victim to establish that it was absent. In other words, while the concept of rape as an aggressive act has remained in place, the precise legal rules surrounding it have changed as the social, customary and conventional context has changed.

What we can see from all of this is that courts and legal systems in a libertarian world would at no time design or construct concepts such as conflicts and aggression, nor would they pronounce from on high which acts are aggressive and which situations are conflicts. Rather, their jurisprudence is moulded by (ultimately) centuries of cases that have come before it, cases that are motivated by the real perception of conflicts by real, individual people attempting to fulfil their ends with the scarce means available. Although a latecomer born into a libertarian society after many generations would see only a plethora of rules seemingly dictated to him from a single source, their origin is, in fact, the heterogeneous, and decentralised values held all of the individual people that make up and have made up that society.

In addition to determining the distinctions between aggressive and non-aggressive acts, another area where this line of thinking comes into play is the distinction between beings which have rights and those which do not. As we outlined earlier, a being has rights if it is a rational actor, that is it is able to undertake actions that are motivated by thought, desire and choice as opposed to actions that are motivated wholly by the laws of physics or by instinct. The existence of rights is impossible in a situation where both the desire and ability to bring about alternative outcomes with the scarce means available is absent. With such an absence, the determination of outcomes is solely a product of might and inertia – the stronger force always winning – simply because there is no impetus to bring about any alternative. This is all that strict libertarian theory has to say about the matter. However, the question of precisely which beings are rational beings and thus enjoy rights cannot simply be a product of theory. It may be plainly obvious to see that a fully grown human adult, as a thinking, desiring, choosing and rational being will clearly be a rights holder while a dead plank of wood clearly will not be. But we only know this precisely because, at some point in history, the earliest humans experienced interpersonal scarcity and each consciously recognised certain possessions as belonging to him in order to meet his ends. Indeed, the most likely way in which we each recognised another human being as a rational entity that should possess rights is whether or not that being made an appeal for these rights to be upheld as this, itself, is a rational action to devote means towards ends. At first this was most likely made tacitly or through body language, aided by our empathy from being in exactly the same position as our neighbour. It is from this earliest seed that entire systems of rights and obligations between individual humans grew. No one at any point commanded from on high that “X has rights, Y does not have rights” and so on. Rather, because of our shared quality of acting rationally, our status as rights holders was enforced from the bottom up as we each sought to progress our lives by directing scarce resources to the uses that satisfy us the most. This brings into the foreground the question of marginal cases such as foetuses, children and higher primate animals. Let us take, for example, abortion. Libertarians are often chided for not having an agreed “solution” to the issue of abortion (as if everyone else is blessed by such agreement). Yet, as we have argued here, this disagreement is not one that is inherent in libertarian theory. Libertarian theory tells us only the qualities that a being has in order to enjoy rights. In an earlier essay, which focussed exclusively on the issue of children and abortion the present author suggested that this question must always be answered in the negative in regard to these beings – that it is so obvious that foetuses and very young children are incapable of acting rationally that they would only come to possess rights, probably in a graduated fashion, as they age. Yet whatever support could be mustered for such a position, it is not strictly a conclusion of libertarian theory. In contrast to this initial conclusion we went on to discuss in a second essay an alternative view which could also, in accordance with libertarian theory, grant rights to children. These questions – whether a particular being such as a foetus possesses those qualities – concerns the application of libertarian theory, not the theory itself. This application will also vary according to the social context, just as the precise acts which can be categorised as aggressive are dependent upon this context. A clear example of this is the changing nature of the rights of children. Even if we admonish the statist intervention into the family unit and the ridiculous and irreconcilable one-size-fits-all cut offs for when children can carry out such acts such as having sex, driving or drinking alcohol, it is tempting to say that it is obvious that children must be regarded as independent, human beings who at least have some rights. In other words, the rights of infants are a universal an immutable fact, independent of time and place. However, this could not be further from the truth. In pre-industrial, agrarian societies where the main economic unit was the family, children were regarded as little more than the property of their parents and their chief worth was their economic value, with any rights they had subsumed by the welfare of the family unit. Although research produced by scholars since the 1960s has indicated that child rearing was not brutal and parents did make sacrifices for their children to maximise their welfare such as care during sickness, the general attitude is hardly unsurprising in an epoch of extreme poverty characterised by persistent hunger, malnutrition and an infant mortality rate as high as one third of babies born. Indeed, we can surmise that telling a mother that she may legally kill her child may have been greeted with an acknowledged, if reluctant acceptance if there simply wasn’t enough food to eat and if the consumption of whatever resources were available was prioritised towards the able bodied population. The more familiar view of children as having an independent identity that accorded them certain rights was born during the Renaissance and the Enlightenment, along with the romanticised view of childhood as an “age of innocence”. However, thoughts during this time were far from uniform. On the one hand, there was the nurturance or caretaker view which was, at its earliest, espoused by John Locke, and Thomas Spence’s “The Rights of Infants”, one of the first pamphlets to specifically consider the issue, is subtitled “Imprescriptible Right of MOTHERS to such a Share of the Elements as is sufficient to enable them to suckle and bring up their Young” (emphasis in the original). This work is written as a plea from the mothers of children to the aristocracy. In other words the rights advocated were of the mother to demand from the gentry the wherewithal to nurture her infant from the produce of the land and were not directly held by the child. The alternative view, that children have much more independent rights, became augmented and subsumed by the onset of industrial society (in which children often worked in factories and down mines), and the backlash of the middle class intelligentsia against the “squalid” and “destitute” conditions of industrial workers generally, a backlash that was itself subsumed by the descent into socialism and communism. Of course, what truly abolished child labour was not a call for children’s rights, but the fact that adults could produce enough wealth for a child to survive and flourish without the latter having to work. The right of a child not to labour and, instead to be supported by its parents, are, like any positive obligations, wholly dependent on there being enough wealth to accomplish this. Thus the specific rights, and to whom they applied, were very much a product of the socioeconomic context. For the sake of completion, we might as well mention that the development of children’s rights in the twentieth century has, unsurprisingly, been welded to the growth of the state and all of its catastrophes and calamities. The Declarations of the Rights of the Child, the precursor to the modern UN Convention on the Rights of the Child which is, as of this day, enshrined in international law, was drafted by Eglantyne Jebb, the founder of the charity Save the Children that was set up to alleviate the starvation and poverty of German and Austrian children as a result of the First World War, a war which would not have occurred without imperialism, state militaries, the drive to autarky, central banking, and so on. The creation of the welfare state and the subsequent disintegration of the family it has caused, together with government provision of education, have all served to make the rights and conditions of children a public affair.

It is not, therefore, a matter for theorists to determine from on high whether or not specific beings such as very young children or foetuses should have rights and what these rights, precisely, will be. In other words, libertarian theory does not demand that children and foetuses, nor any other specific being, have rights. Rather these rights, if they exist, will be generated from the bottom up and will depends very much on the customary, conventional and socioeconomic context. We explained in detail how a modern libertarian legal system may approach the question of the rights of children in this manner in our second essay dedicated to the topic and we will not repeat this in detail here. But we can mention briefly that a series of legal presumptions is likely to govern these rights. There is likely to be at least a legal presumption that a child is a rational being when it comes to the right to bodily integrity (so that a child may not be legally killed); further legal presumptions will grant further rights to children (i.e. to enter contracts, to drink, marry, enter employment, etc.) either at ages where the court has previously found children to be generally competent for these acts, or at ages or milestones which are important in the social context, such as the Bar Mitzvah in a Jewish community. One unique aspect of a libertarian legal system, however, is that these milestones need not be concrete or set in stone as the state makes most of them today. It may well be open to the child, or to another individual, to rebut the presumption. If, say, there is a legal presumption that a child cannot enter a contract of employment below the age of thirteen, a child below this age may contest any challenge to a prospective contract if he (or the prospective employer) can demonstrate to the court’s satisfaction that he made this decision in the manner of an adult – i.e. it was a rational choice to better his life. There should be no danger of a perpetual, enforced childhood in state run schools if the child is uniquely mature enough to seek a better life for himself. Conversely, if a child is mentally impaired the rebuttal may work the other way with the parents or guardians establishing before the court that, at a presumed age, the child is still not competent to undertake certain acts in his or her own right. Abortion may be more difficult but we can suggest, for example, that if advances in medical science reduce the amount of time for which a pregnancy has to elapse before the foetus is considered viable then the law may regard the foetus as a whole, legal person much sooner that it previously did. If and when we have the technology and are able to establish communication with some of the higher functioning animals, these too may be regarded as rights holders in at least limited circumstances. To repeat again, however, this discovery of certain animals as rights holders would be made as a result of the recognition of these animals as independent, rationally acting beings. The rights will be dependent upon what these animals want because we discover that they are able to want, to desire, to choose different outcomes and to act accordingly. Contrast this to the current statist enforcement of so-called “animal rights” from the top down. These rights are not really animal rights at all – they are the rights of certain people who claim to care about animals enforcing how they believe other people should act vis-à-vis animals. The benefit gained from a vindication of any of these “rights” exists in their minds, not in the minds of the animals.

This, then, is a suitable concluding note to emphasise from what this series of two, rather long, essays. That these phenomena – rights, obligations, conflicts, aggression and so on – serve to regulate the desires of individual, rationally acting beings, a regulation that is necessary to resolve the perception of scarcity that exists in these people’s minds. The existence and content of rights is driven by this impetus. Rights are not designed or constructed from on high by an intellectual in an ivory tower, nor are those who benefit from them assigned by a politician. Any attempt to design rights is akin to treating to individuals as pieces on a grand chess board – pawns in a game of shaping society according to what the intellectual or politician wants. Our conception of rights here is focussed firmly on vindicating the individual and, while it may appear as a limitation upon libertarian theory to answer certain precise and practical questions, ultimately strengthens it.

View the video version of this post.

The Nature and Origin of Rights, Part One

1 Comment

There is nothing that highlights more the uphill struggle faced by libertarians than an old joke which is directed at the economics profession in general:

How many economists does it take to change a lightbulb? None – the market will take care of it.

Unlike our statist counterparts, as proponents of the free market we have no precise design for the solutions of particular issues and problems. We do not have an energy plan, a transport plan, a housing plan or a healthcare plan. Rather, we believe that freely acting individuals, endowed with private property rights, will find the solutions that utilise the scarce resources that we have in the most efficient way possible. Indeed, when asked the (almost tiresome) question “who will build the roads?” we don’t, strictly, know that a free market will produce any roads whatsoever. There may, in fact, be some better transport solution that compulsory government road funding prevents us from discovering. This is, in fact, the entire point of the free market – that there is no grand, overarching plan with particular solutions that are imposed upon everyone else from on high. Moreover, any kind of centralised plan or desire for the government control of goods and services has always presupposed the existence of industries and products, such as roads, that were invented by freely acting individuals.

This key aspect of the free market – a complete lack of centralised design of products, services and entire industries – is not limited to the substantive configuration of resources. Rather, as we shall attempt to argue at length in this two-part series of essays, it extends also to the very concepts and institutions that uphold a free market order – in particular, laws, rights, property, non-aggression. Part of the question we wish to explore here, then, is if we, today, had to the opportunity to sweep aside the entire mantra of statist oppression, would the institutions that we put in its place be subject to some kind of design by libertarians or would they also be subject to some kind of decentralised action by freely acting individuals? In other words, would we come along and say “this individual has rights”; “this object is property”; “this act is aggression”? More potently, however, we need to explore whether the nature and origin of concepts such as rights, property, aggression, and conflicts lend themselves to some kind of conscious design or whether they depend upon the behaviour of freely acting individuals in order for their true meaning to be realised. Once we have determined this we will be able to conclude whether it is only by recognising the dependence of these concepts upon freely acting individuals that a genuine libertarian society be built.

Some readers will recognise that we are following here a line of epistemological thinking propounded by F A Hayek, mostly in Law, Legislation and Liberty, as to the appropriate use of rationalism in understanding and framing societal institutions – i.e., is our rationality, our ability to reason and to act purposefully, better suited to constructing and designing social institutions, or rather, are these institutions instead the product of some kind of “spontaneous order”? If the answer is the latter then the focus of our rational endeavours should be to gain comprehension, insight and understanding into elements of human interaction that have already been built and not to recreate these elements anew.

Let us begin with some simple examples in order to illustrate what we mean by this. The first example we shall use is language. Any language that we speak is a complicated thing, with lots of different words and lots of different rules for using those words. However, language itself and the very vast majority of specific languages were not invented explicitly by anyone. Rather, they grew up through millennia as a result of individual people striving to communicate ideas to each other. The meanings of words but also the concepts of sentences and grammar also developed without any centralised plan and before anyone acknowledged consciously the precise forms and structures they were using. For example, if, years ago, one of the first humans said “I will throw this ball”, neither he nor his partners in dialogue would have known explicitly that he was using a subject, a verb and an object to create what we now call a sentence. If he elaborated and said “I will throw this red ball” he would not have known that he just inserted what we now call an adjective. Yet anyone he spoke to would have understood the ideas that he was trying to communicate in the sentence. Moreover, if he tried to say something like “ball thrown I red” those listening to him would probably recognise that he was talking utter nonsense – but they would not necessarily be able to say precisely why this sentence is wrong. Indeed, even the idea behind concepts such and nouns and verbs probably never even entered these people’s minds – in the same way that they do not explicitly enter the minds of the vast majority of people who communicate through language today. It was only after many centuries of languages being used and developed that linguists came along in order to study the phenomenon of language systematically and to develop the rules and concepts of grammar, writing and speech. Yet, crucially, the role of the linguist or grammarian was not to invent or design these rules, or to reconfigure language as a whole. Rather, his role was to gain insight and understanding into a process that already existed – to gain rational comprehension of a phenomenon that was of no single human’s construction. For example, an adjective is a particular concept that concerns the use of words in order to describe nouns. For example, a red ball; a tall boy; an old lady. By calling these words adjectives the linguist did not invent the concept of an adjective. Rather, the concept itself already existed as a phenomenon of human interaction for which the linguist only provided a label for us to identify it and distinguish it from other phenomena. Thus the label “adjective” aids the endeavour of gaining rational insight and understanding into the phenomenon of language and does not amount to the construction of anything that was not already there. If, on the other hand, linguists tried to reinvent these concepts or to attempt to apply them to other phenomena then we can see easily that we would run into all sorts of trouble. Let us imagine that a budding, pioneering linguist comes along with the aim to reinvent the rules of language, to undergo a reconstruction in order make it more coherent and, no doubt, more “rational”. After all, he is a scientist of the human race, a race that has managed to build everything from enormous craft that fly into space all the way down to tiny computers that fit into your hand. Surely he can master the design of something as simple as how we speak to one another? Let us say that he decrees that an adjective should describe not the noun in a sentence but, rather, the verb. So in the sentence “I will throw this red ball” this linguist would claim that the word “red” should actually describe the verb “throw” – so that the quality of throwing is, in some way, red. Or in the sentence “I will drink this hot coffee” the word “hot” describes the act of drinking rather than the condition of the coffee. Clearly such a reinvention would lead to utter nonsense and a complete breakdown of the purpose of language, which is the successful communication of an idea, i.e. making yourself understood by another party. The concepts that the linguist identifies, such as adjectives, are not open to his reconstruction – to him they are phenomena that already exist as a given, much like the fact that the sun rises and water flows down. The only difference is that the phenomena associated with language arose out of the interaction of many millions of human beings across centuries rather than straight out of the natural world. These concepts the linguist identifies describe a strand of reality that are already there for him to identify and to understand; any attempt by him to impose an alternative meaning or definition of these concepts results in something completely different from their original nature.

Whether or not alternative languages can, in fact, be designed, is beside the point. Languages have been designed explicitly, with Esperanto being the most notable, although any designed language has failed to gain any significant use. Our point here, however, is that existing languages are not the product of design or reinvention and that the concepts we use to identify and understand them are also not invented phenomena. Our attempt to engage in such a reinvention must necessarily result in something completely different from that which already exists.

In order to explore this further let us take another example of a social phenomenon such as prices. Indeed, prices are a classic example of a social institution that, unlike language, has been subject to a kind of constructivist reinvention. The phenomenon of prices appeared as a result of millions of private, bilateral transactions millennia before anyone actually stopped to determine what prices actually were and how individual prices are set at the levels they are. Just as the linguist used his capacity for rational analysis to determine the elements of language, so do did the economist approach the concept of prices with the desire to comprehend and gains insights into this reality, not to construct anything new (an endeavour which was only accomplished sufficiently after the realisation of the law of marginal utility). What was learnt was that a price is the exchange ratio between two goods that results from the competing valuations of those who supply a good versus those who demand it with another good (usually money). The specific price is set between the valuations of the marginal buyer and the marginal seller. The effect of a price at this level was that the willing supply and willing demand for a good were equalised.

What happens, however, when we deflect our rational thinking away from gaining comprehension of this phenomenon and embrace, instead, the desire to gain control of and “create” or (as economists usually say) “fix” prices? This false, constructivist approach looked only at surface level phenomena of prices that were manifest in the fact that the act of pricing was largely carried out by entities that were sellers of commodities and buyers of labour – in other words, businesses. This, aided by other confusions such as the paradox of value – the conundrum as to why a diamond costs more than water when the latter is infinitely more useful to mankind – led to the conclusion that prices were simply declared (as opposed to estimated) by sellers and/or were merely the arbitrary and capricious results of unrestrained greed. It would follow from these falsehoods that the price of a good could be manipulated at will or established by decree. Yet it is clear that this conception of prices has entirely different ramifications from the previous one that we outlined. With these new, constructed prices their ultimate influence is not the individual interactions of all of the millions of people attempting to fulfil their purposes but rather the preoccupations of those who decree them (i.e. the state), which are mainly political. Most of the famous cases of price fixing were designed to counteract the effects of rampant inflationism, such as the Emperor Diocletian’s fourth century Edict on Maximum Prices and President Nixon’s price and wage controls in the 1970s. The results of these prices too are markedly – even catastrophically – different. If the decreed price is too high relative to the price that would be set by supply and demand then an unsold surplus of the good would accumulate; if the price was too low then a chronic shortage would ensue. In both cases the quantity demanded and the quantity supplied are shifted out of balance, resulting in economic turmoil – as it was in the 1970s when Nixon’s price controls exacerbated the effects of the OAPEC oil embargo, leading to an acute shortage of gasoline (which, of course, promoted further government intervention in the form of selective government rationing, the 55mph speed limit and the moral degradation that occurs as a result of the destruction of the supplier/customer relationship).

Under both conceptions of prices – the un-designed and the designed – all of the surface phenomena of prices are constant. Price tags are still on the goods (if there are any goods) and money still changes hands. Yet it is clear that the difference between the two concepts is to encapsulate two entirely different strands of reality that each have vastly different origins and motivations, and vastly different consequences. In moving from the first conception to the latter, the concept of price has been changed from meaning the exchange ratio that results from the interaction of supply and demand to basically meaning the exchange ratio that is ordered by the state.

It is clear from this, therefore, that a concept, such and nouns, verbs, prices, which developed as a result of human interaction, cannot simply be changed at will or by agreement without entirely undermining its essence. Indeed with prices not even an explicit agreement amongst all of the consenting citizenry as to what a particular price should be would circumvent this fact because the resulting exchange ratio would still not accord with the reality that the concept of price tries to capture, which is the exchange ratio that results from supply and demand. What we can also begin to see is that any attempt to redesign or reconstruct these phenomena destroys their service for free, individual people and instead places them at the service of the state and is therefore antithetical to liberty. We can see this more clearly in a third example of this type of concept which is money itself. The phenomenon of money – the generally accepted medium exchange – appeared through millions of bilateral exchanges before anyone stopped to think about precisely what they were doing when they handed over, say, lumps of metal like gold or silver in exchange for stuff they could eat or use as shelter. Money was something created as a result of human interaction but nobody designed or invented money. The product of this was a medium of exchange that served reliably as a store of value, as a unit of account and as a major bulwark of sustainable economic progress. All of the monetary issues we experience today – the business cycle, inflation, and a grossly unstable financial system – stem from the attempt to recreate the concept of money as something that is created and enforced by the state, an endeavour that has not only resulted in the catastrophic effects we just outlined but also a tremendous loss of liberty as governments have been able to fund their bloated operations without resort to regular taxation.

Bearing all of this in mind, then, what is the nature of other sociological concepts which form the core of libertarian theory? These are concepts such as property, rights, obligations, laws, conflicts, and aggression. Are these phenomena which appeared gradually over many hundreds of years through social interaction? Or were they the explicitly designed product of, say, a wise and benevolent ruler who sought to create order out of chaos? We shall argue here that concepts such as rights and obligations are indeed of the same ilk as prices – they appeared over millennia as a result of millions of humans attempting to fulfil their individual purposes. The concepts were not the product of explicit, human construction; rather, they were a reality that already existed before anyone consciously thought of the matter. The purpose of our rationality is to reflect upon this reality, understand and comprehend what was occurring, and from this understanding fashion these concepts in order to explain and describe this reality. Any attempt to reconstruct them anew will, as we shall see, destroy their real value to the freely acting individual and instead place them in the service of the state.

Let us recall that the question of rights and property only arise because of conflicts that result from scarcity – the fact that two or more individuals cannot satisfy their ends owing to shortage of means. Rights and obligations over physical matter that is designated as “property” are the solution to these conflicts. In other words, rights and obligations only arose because individual, rationally acting beings, incurred a reciprocal recognition in a particular situation that physical means available were not sufficient to satisfy the ends of each, hence one had to yield and refrain from action and the other could act. The source of a conflict was the fact that one of the parties would have to suffer a loss of *value* – and end worse than the one he sought – if he had to yield to the other party, who, in turn, would have his value realised. These conflicts and their prescribed resolutions are endemic to the situation of humans as social animals. It is highly unlikely that two humans ever interacted without running into some kind of conflict over scarce means, particularly as primitive man suffered from the scarcity of the most basic of needs far more than we do today. Hence social rules are likely to be as old as humans themselves. These conflicts and their resolution through a system of rules began long before anyone actually explicitly enunciated that which was occurring. Indeed the words “rights”, “ownership” and what they were may not even have been known to anyone who sought them, in much as the same way as no one knew what a verb or a noun are until long after people actually began to communicate through language. Nobody at any point woke up one morning and said ‘Gosh, I believe it would be awfully nice if everyone had the right to private property!” as if it was an entirely new creation, nor did anyone ever explicitly “agree” the same thing. The earliest rules were probably acknowledged and understood tacitly with communication through body language. Later, as the earliest civilisations were born, customary legal systems developed through appeals by the conflicting parties for adjudication by a plurality. They made this appeal because, in the long run (and according to their own valuations), ad hoc conciliation is uncertain while resolution by violence is both uncertain and costly and dangerous. Indeed, we might say that although this process requires a degree of reflective ability of the plurality’s members, the legal rules and principles that crystallised depended upon a) their ability to address the situation that identified by the rational actors to which they need to be applied, b) the willingness of the parties to yield to them and thus avoid violence, and c) their ability to serve as a guide to behaviour in order to avoid similar incursions in the future. Crucially, there was no centralised force that had the authority to either decree or enforce the law, such authority, where it existed, resulting from usurpation. Rather, adjudicators had to earn and maintain their reputation in the knowledge that parties could seek justice elsewhere and that they – the adjudicators – might too, one day, be involved a conflict and stand to be judged. To this extent, therefore, the dispensation of impartial and principled justice resulted from self-interest. Indeed, we might say that the whole edifice of consistently and impartially applied legal rules existed solely because, in the long run, these things were the cheapest option for people to fulfil their ends. In other words, that agreeing to resolve conflicts peacefully through a system of rules was, in the long run, the best way for people to maximise their wellbeing. The result of this was, of course, the development of society – the peaceful co-operation between individuals seeking to fulfil their needs and better their lives.

Indeed, it is important to stress that a well ordered and functioning society was the product of customary social rules and was not their precursor – the peaceful resolution and avoidance of conflicts is what permits social co-operation, either primitively or under the division of labour, to flourish, and it only did so because people desired it. “Society” did not come first in order to fashion and enforce the law or to determine what conflicts were and where they existed and how everybody should behave. We are tempted to address this chicken and egg problem differently today because “society” precedes us and so we also think that it precedes our rights and obligations; we were born into an existing social order that seems to grant and impose these things on us from on high. It certainly true that latecomers to a social order, who, like us, were born in succeeding generations or were formerly outsiders, were likely to find themselves bound by previously enunciated rules. However, the origin of those rules was the perception of conflicts by individual, rationally acting people. So when, today, for example, we extrapolate from these past cases and say that a particular right applies to me and to everyone else in the world it is true that these rules and concepts predated anyone who is alive today so that it appears as though somebody else is either granting us these rights or enforcing these obligations upon us. But even today we can see that rights, obligations and conflicts must originate from the minds of the parties to the dispute that the legal rule seeks to solve. Strictly speaking when we say that “I have the right to private property” what I am really saying is that this right would be enjoyed by me in a hypothetical case where I enter a conflict over a particular good. But just as in the pre-historic cases that crystallised the concept of a right, this conflict would have to be perceived by me in order to be a breach of my rights. Someone taking my property is not theft unless I do not want them to take it; if I am perfectly fine with it then my right is not infringed (indeed, in a world where everyone helped themselves to each other’s stuff as they pleased and everyone had no problem with it no one would even know what a right to private property was). Rape is only rape because a woman (or a man, even) does not want to be penetrated; if he/she doe then it is sexual intercourse. One person injuring another is only assault because the latter does not wish the former to injure him; if the injury is the result of a consensual contact sport or an unusual sexual fetish then it isn’t. A person’s free speech is only infringed because he wants to speak. If, on the other hand, he is an uncontrollable blabbermouth who talks before he thinks then he may welcome the occasional physical restraint from speaking. In all of these cases where the physical act is consensual there is a harmony of interests – the scarce, physical matter available is directed an end that is sought by both parties and thus there is no conflict. The question of rights only arises, however, when the two parties are trying to direct physical matter towards different ends (and also, we might add, when the cost of resolving the matter in this manner is less than the cost to the plaintiff of fulfilling his ends with other means; if you steal from me a paperclip it is probably cheaper for me to buy a new one than it is to sue you for it; the history of fencing laws is illustrative of the changing economic dimension of rights and obligations). In short, because it is my right it is my choice to waive it when someone else’s goals with the same, physical matter are identical to mine.

Let us re-emphasise, therefore, that the nature of these concepts – rights, obligations, conflicts and so on – were revealed to us through rational reflection upon social interaction, and the distillation of common elements and their justification according to common principles uncovered – not created – the formulae that we libertarians cherish today, such as the individual’s right to private property.

Let us turn now to a different, constructivist conception of what rights and obligations may be – that is that these concepts were deliberately created or invoked by specific persons such as monarchs, leaders or intellectuals. It is clear that if the origin of a proposed right is not the resolution of a conflict arising from the competing valuations that exist in the minds of the parties, it must, rather, be something else. There are only two possibilities. First, a third party constructs a right according to what he hypothesises is a conflict between the parties over the property in question when there is in fact no such conflict. In other words, rather than being a party to a conflict himself, this third person looks upon the condition of other people and declares that they are in a conflict with each other that needs to be corrected with a system of rights. The second possibility, which is joined at the hip with the first, is that the conflict over property results from the valuations of a third party or of a group (such as intellectuals) who call for the construction of rights and obligations according to their own direction. In other words, these people want to distribute property rights according to what they want rather than what everybody else wants when everyone else may, in fact, be living in perfect accord with one another. In both cases the concept of a right has been changed from the resolution of a conflict over scarce, physical goods as perceived by the parties into being the resolution of a conflict over the same goods perceived by somebody else. Your rights and obligations are no longer determined by what you, as a freely acting individual want and value; rather they are defined by some other person. This is something that is markedly different, something that changes not only the definition of a right itself but also the definition of specific rights.

An exaggerated example of the first type of “right” – one that is simply imposed – is a right of each person to air. Intuitively, a right to air sounds more than plausible – after all, a person will live for barely minutes if he is not able to breathe. Surely, as some pioneering progressive might say, it is a travesty of justice that we do not all have a right to something as basic as air?! Under the state’s self-appointed mantle that it needs to ensure that we all have enough air to breathe, perhaps we can imagine exclusion zones round each other’s bodies which no one else may breach in case they breathe “your” air in the zone. Or, needless to say, we could imagine countless other ridiculous “solutions” to this non-problem. Rights to air do not exist, of course, because nobody (yet) conflicts over particles of air. The supply is more than sufficient to meet each person’s need without anyone ever coveting the air breathed by someone else. Hence rights and obligations in this scenario are superfluous and any invocation of them is an unwarranted affront to people’s perfectly peaceful behaviour. (The contrary case – that of taking away rights when they are, in fact, demanded, such as with rights to own animals that are members of an “endangered” species – is of the same ilk, but we need not deal with that here).

With the second type of constructed rights, let us take the right to private property which protects one against, say, theft. If, in order to “protect” my property, this right is no longer defined according to my valuation as to how I best want my property directed – i.e. my willingness to “exercise” my right – it must be defined by reference to something else. This can only be what the imposing party, or his intellectual advisers, regard as their valuation as to how the property is best directed. The resulting prohibited action is no way a vindication of my right to private property at all – if I am perfectly happy for my property to be taken in a particular incident and this is clearly evident then there is no discord between me and the alleged thief, nothing that the imposition of a right needs to solve. What has in fact been accomplished is the voiding of a transaction that the imposing party disapproves of according to his valuations at the expense of the valuations of me and the person who took my property. The critical element required for a generation of rights and obligations – a competing valuation over scarce, physical goods – is held by the imposing party, not by the constructed “rights” holder (i.e. me). Hence, the de facto right – i.e. the ability to have property directed to ends according to which one desires – is also held by the imposing party, not by the constructed rights holder, for it is really the imposing party’s valuation regarding this particular piece of property that is vindicated. Theft has now been constructively redefined from meaning a conflict between a property owner and a person who takes it, into a conflict between those two parties and the state. This is clearly anti-libertarian as it subsumes the desires of all of individual people and permits the imposing party to direct everyone else’s property to its desired end. The result is practically the same as the government simply outlawing certain types of voluntary trade, such as drugs or prostitution.

What we will proceed to explore in part two of this series of essays is precisely how this state of affairs – the movement from rights as a product of human interaction to being a product of explicit construction – came about and how devastating it can be to individual liberty.

View the video version of this post.

Older Entries