The New Libertarian

The common perception of Anarchy today appears to be one of chaos and destruction. Without the State, it is proclaimed, violence would immediately ensue; without law, there'd be no deterrent disincentivizing this, and we'd return, in the words of Thomas Hobbes (1660), to an age where "every man is Enemy to every man", and "the life of man, solitary, poor, nasty, brutish, and short." But is this really what by necessity would result from abolishing the State? I've previously forcefully argued against the theoretical foundations of the State (Kløvning, 2019a), and although my premises were not disputed, the conclusion of dismantling the State provoked many consequentialist concerns of what could happen if actualized. The central question that must be answered to address such concerns is whether the substitution of Anarchy for a State would possibly be undesirable despite the former having more of a rigorous and defensible logical foundation than the latter.


A classic parallel to this problem is J. W. Goethe's Faust, where the main character Faust trades his soul to a demon in exchange for "otherwise unattainable knowledge and magical powers that give him access to all the world’s pleasures (Faustian Bargain, 2019)." The concept of a "Faustian bargain" derived from this story is accordingly defined as "a pact whereby a person trades something of supreme moral or spiritual importance, such as personal values or the soul, for some worldly or material benefit, such as knowledge, power, or riches." Applied to the Anarchy-State dichotomy, the tradeoff is between security and liberty. Is Anarchy thus a Faustian bargain of giving up security in exchange for the promise of the wonders of liberty?

The American founders understood the tension between security and liberty more than most. Benjamin Franklin asserted that "They who can give up essential liberty to obtain a little temporary safety, deserve neither liberty nor safety (Franklin & Bigelow, 1904)." Similarly, Thomas Jefferson wrote, judging between a system of (1) no government, (2) a government where "the will of every one has a just influence", and (3) a government of force, that he saw the first as "not the best" and that he believed it to be "inconsistent with any great degree of population," while,

The mass of mankind under [the second system] enjoys a precious degree of liberty & happiness. It has it's evils too: the principal of which is the turbulence to which it is subject. But weigh this against the oppressions of monarchy, and it becomes nothing. Malo periculosam libertatem quam quietam servitutem [I wish rather for perilous liberty than peaceful servitude]. Even this evil is productive of good (Jefferson, 1787).

It is to no surprise that those who set out to establish a government didn't perceive Anarchy as practicable, and it's a great irony of history that the country starting with the smallest government in history gradually became one of the largest (Kløvning, 2019b), but the degree to which this tradeoff is emphasized is rather notable. Patrick Henry asserted even more forcefully:

Is life so dear, or peace so sweet, as to be purchased at the price of chains and slavery? Forbid it, almighty God! I know not what course others may take, but as for me, give me liberty or give me death (Colonial Williamsburg, n.d.)!

The two central questions are thus as follows: (1) is there a tradeoff between security and liberty in the Anarchy-State dichotomy; and (2) if there was, which system would be the most ethically and logically defensible? The first question is what will be primarily discussed here, as the latter has already been reflected upon somewhat in Kløvning (2019a) and Kløvning (2019c).

The notion that there is some tradeoff between security and liberty has an intuitive appeal. As the government grows in scope and influence, the laws become more numerous and the enforcement thereof more comprehensive. The citizens will then have the opportunity to utilize the service of the State police to protect themselves against those harming the former's bodies and property, and the courts to work out civil disputes. This also means, however, that the people are increasingly restricted in terms of what they can do or not. Additionally, to finance the State police, courts, and its other programs, it extorts the citizens through taxes they have no choice but to comply with.


It's also by no means clear that State law would overlap with some objective morality. I will not here delineate or apply natural law theory to the matter, as done by Rothbard (1982), but for our purposes here suffice it to say that the politicians and bureaucrats have their own personal interests and have not received their commandments straight from God like Moses supposedly did. Accordingly, there will be unjust laws, and the State could thus become a threat to their own citizens, severely violating their security. The philosopher Spinoza said, for instance, that "He who tries to determine everything by law, will foment crime rather than lessen it." This is especially the case in third-world countries, but as I've documented in-depth previously (Kløvning, 2019d), it also applies to a significant degree with the United States. In the European country of Georgia, the corruption of the police force was so severe following the collapse of the Soviet Union that it was disbanded completely on a national scale in the Rose Revolution of 2004 (Stringham, 2015: 135). According to Edward Stringham, a local Georgian told him afterward that "I did not notice any difference in crime, except I actually felt safer because I did not have to worry about being robbed by the police."

It seems, then, that there isn't exactly a perfect negative correlation between security and liberty in all circumstances when it comes to the laws imposed by the State, so what may the relationship between them be otherwise? In Private Governance, Edward Stringham (p. 197) applies the law of diminishing marginal returns to answer this question, illustrating graphically how the net benefits changes with the number of rules:







The law of diminishing marginal returns says that "adding an additional factor of production results in smaller increases in output (Kenton, 2019)," and Stringham points out that this applies with the number of rules as much as other things, reducing the marginal benefits and increasing the marginal costs as the Federal Register grows. A new law or regulation will generally have less of a marginal (i.e. additional) benefit than the last one, and at one point the quantity may become so great that a net loss is incurred. The key, one may argue, is to be at the peak of the curve.

Going back to the question of the viability of Anarchy, does this mean that it would only be superior to a government in the cases where the laws and regulations have compounded to the degree that a net loss of rules is incurred? Only if one assumes that there are no rules under Anarchy, which is a common belief, albeit misguided. Even if there were no laws or rules at all in a given Anarchistic society, the residents could arm themselves as they pleased without being bothered by restrictions imposed by a government, and they would thus have the opportunity to acquire security by protecting themselves and their family in that sense.


A lot of literature has, however, been dedicated to explaining and delineating how Anarchistic societies theoretically can and historically has developed rules and security. For example, as Morris and Linda Tannehill (1970) have suggested, people could purchase private security services from firms willing to offer such, and "Conflicting claims would be settled by bringing them before private arbitration agencies for binding arbitration." This means, in short, that substituting Anarchy - in the real sense of the term - for a State would not mean having no security, but on the contrary to have competition in security and arbitration rather than a monopoly. A lot of objections may be levied against this position, questioning the viability thereof, but as we'll see below, the Tannehills and others tend to have thought well through most of these.

What makes the actions of the private security firms "legitimate"?

Assuming as a starting point that self-defense is permissible to fend off someone aggressing against one's body or property, one could also justly delegate this right to another (i.e. the private security firm) to act on one's behalf. One could opt out of the service and the costs thereof if one didn't consider them to act on one's behalf any longer, or if the costs ended up exceeding the benefits. None of this is the case with State security, where their "authority" and "legitimacy" is derived from the delegation of "rights" that the voters don't have (i.e. to aggress against people through extortion, theft, kidnapping, murder, etc.), and not paying one's premiums through taxes is met with violent aggression rather than no longer being able to receive a service like State security.

What if private security firms become corrupt and violent?

Private security firms, may, like State security, become corrupted and end up acting against the interests of the clients. There are reasons to believe, however, that this would be far less likely to occur with the former than the latter. State security is a monopoly, and one can thus expect by applying economic theory on the issue that that'd lead to higher costs and lower quality (Kløvning, 2019e). On the contrary, under Anarchy, private security firms would be competitive, and one would accordingly be able to choose a different one if the costs turned out to outweigh the benefits. If a firm tried to start operating as a State, for instance, by demanding the premiums be paid whether one wanted the service or not any longer, and aggressed against people rather than just enacting the act of self-defense delegated to them, this could severely harm the firm's reputation as it would not be seen as "legitimate" like the State has managed to make people believe. Other private security firms could then be hired to fend off such an aggressor, whether they purport to represent a private security firm or just a lone burglar.

How would arbitration agencies develop their "laws" and how would their decisions be binding for its subjects?

In an Anarchist society with competing security firms, they could come into disputes in cases where the firms of the alleged victim and perpetrator respectively disagree on the guilt/innocence of the accused and/or the punishment suggested. To work out this disagreement, they could agree upon a third party - an arbitration agency - to hear out the argumentation on both sides and make judgments accordingly. The "laws" of that arbitration agency may have been developed by some professional jurists, likely taking a basis in the social customs and moral code of the society/community in general. The Tannehills contend (p. 56),

The free-market arbitration agency, if it wanted to stay in business, would have to make as fair a decision as it possibly could. Both disputants would then be impelled to abide by the arbiter's decision, since a man who contracted to abide by the results of arbitration and then broke his contract would be announcing himself as unreliable, and no one would want to risk having any business dealings with him.