The Common Sense of Philosophical Anarchism

July 9, 2011 12 comments

Philosophical anarchism is the idea that there is no duty to obey the law just because it is the law. Philosophical anarchists claim that there is no moral obligation to obey the commands of the state, and conversely, the state does not have the authority to command. In other words, the state is morally illegitimate.

Most people deny that philosophical anarchism is true. The most common reason is that citizens have freely consented to be governed by their states. Either expressly or tacitly, we have consented to the laws established by our government. Hence government is based on the “consent of the governed.”

The biggest problem with express consent is that it is plainly historically inaccurate. Apart from naturalized citizens, hardly anyone has ever explicitly consented to be governed. Given the absence of express consent, most arguments for the consent of the governed rely instead on tacit consent, through voting or residence.

Consider voting. The idea is that by voting for a political representative, we consent to the laws they establish. By participating in the electoral game, we agree to abide by the outcome.

The problem with this argument is that voting is a coerced choice. First of all, only choices that are free of coercion can generate obligations; if a choice is coerced in any way, it loses its moral ability to create an obligation. While there are cases where tacit consent can generate obligations, voting is not one of them, because the voter is never given the most important choice of whether or not there will be a government. Unless a voter is given the option to secede and avoid being governed at all, the act of voting cannot be taken as consenting to government.

Consider: a murderer breaks into your house and gives you the choice of being stabbed or shot. Your choosing to be shot does not mean you consent to it. The reason is that the murderer forces you to make a coerced choice: either be stabbed or shot. You do not have the option of not being coerced at all.

This example is importantly analogous to voting, because both the victim and the voter are subject to coercion, and neither have the choice of whether or not they will be coerced. Just as the victim will be killed no matter how she responds (and even if she does not answer the question), the voter will be subjected to coercive laws no matter how she votes (and even if she doesn’t vote). So voting, as a coerced choice, is not able to establish the consent of the governed.

The second argument given for tacit consent is residence: by choosing to live in a country, we agree to obey the laws of its government. Just as when you come into my house, you have to obey my rules, so too when you live in a certain country, you have to obey the rules of the government—love it or leave it.

Notice that this argument implies that just as I am the owner of my house, the government is the owner of the country. That is, the government is in a position of moral sovereignty over its territory and can demand that its citizens either obey or leave.

The problem with this argument is that it is circular. The consent theory of political obligation claims that government authority is based on the consent of the governed. Residing in a territory can indicate tacit consent only if the owner already has authority to demand you obey or leave (as when you come into my house).

But if government authority is based on consent, then that authority cannot exist prior to the consent of its citizens. This is, however, precisely what is required by the residence argument: government must have authority over its citizens before they can give consent, which is what needs to proved. Hence the residence argument fails. Unless government already has authority over us independently of our consent, then residing in a country cannot imply consent to that government.

At this point most people will appeal to an argument from fair play: since we receive benefits from government, we are thereby obligated to obey it. But this also fails to justify a duty to obey, since on this argument an investment company would be justified in seizing my life savings without my permission on the grounds that I would benefit from its money management. The problem here is that the benefits of a legal system are such that we cannot refuse them; and unless you can refuse a benefit, it is not clear how you are obligated to pay for it.

So the most popular arguments for a duty to obey the state fail. If the state is morally illegitimate, then we should embrace philosophical anarchism. Furthermore, we have good reason to investigate political anarchism, to see if it is possible or desirable to do away with the state entirely.

Categories: Uncategorized

The Paradox of Government

June 26, 2011 2 comments

If men were angels, no government would be necessary. If angels were to govern men, neither external nor internal controls on government would be necessary. In forming a government which is to be administered by men over men, the great difficulty lies in this: you must first enable government to control the governed; and in the next place oblige it to control itself. — James Madison, The Federalist No. 51

Quis custodiet ipsos custodes? — Juvenal,  Satires

Economic prosperity requires a legal system that protects property rights and enforces contracts. Establishing a legal system in turn requires an agency with a monopoly of violence—a government. Herein lies the paradox of government: an agency with a monopoly of violence has the ability to protect property rights, but it also has the ability to violate them. As Weingast writes: “The fundamental political dilemma of an economic system is this: A government strong enough to protect property rights and enforce contracts is also strong enough to confiscate the wealth of its citizens.”

The problem, then, is empowering government to subdue predators without letting it become an instrument of predation itself. This means giving government the power to protect property rights while at the same time preventing it from using this power to destroy property rights. How is it possible to simultaneously empower and constrain government?

The rarity of economic prosperity throughout history tells us that solving the paradox of government is no easy feat. But the existence of economic prosperity in the first world tells us that first-world governments have been able to find at least a somewhat good solution to the paradox.

So how can the paradox be solved? Given that government has the ability to do good (enforce property rights) and bad (destroy property rights), how do we give government agents the incentive to do good and avoid bad?

The traditional solution given by constitutional political economists has been: constitutional constraints. The point of federalism, separation of powers, and the rule of law is to structure government power in such a way as to limit how that power can be used.

And it seems like these constitutional constraints have worked. In the first world at least, government violation of property rights is fairly limited. There is little arbitrary seizure of property. Most restrictions on property rights come in the form of taxation and regulation, and these are institutionalized in the democratic process. Hence they are more regular than arbitrary, which is a good thing.

As I have argued elsewhere, market anarchism can be seen as the logical conclusion of constitutionalism and the best solution to the paradox of government. The checks and balances inherent in market competition are a stronger constraint on power than any governmental mechanism like federalism or separation of powers. Hence the principles of constitutionally limited government are most effectively realized in the system of market anarchism.

The case for market anarchism depends crucially on rejecting the premise that a well-functioning legal system requires a monopoly of violence. But it’s not clear that such a legal system can exist without a state. I plan to address this question in my future research.

Intranational Anarchy

The concept of international anarchy is well known: in the absence of a world government, the various states of the world relate to each other under conditions of anarchy. There is no ultimate authority to resolve disputes or enforce law among the governments of the world. Hence any cooperation between states must be cooperation under anarchy, without the intervention of a world government.

While it is commonly recognized that there is anarchy between governments, it is less well known, but equally true, that there is anarchy within governments. That is, just as the agents of different governments are in a state of anarchy vis-à-vis each other, so too the agents of the same government are in a condition of anarchy in their relationships with each other.

For example, under international anarchy, an agent of the Canadian government and an agent of the U.S. government interact without a world government governing their relationship.

Now consider two agents of the U.S. government. In their interactions with each other, they cooperate without some higher government ruling over them. Call this intranational anarchy: the agents of a single government are in a state of anarchy vis-à-vis each other. (See Cuzán’s paper “Do We Ever Really Get Out of Anarchy?“.)

On the classic Hobbesian account, cooperation and social order are not possible under anarchy. Without some ultimate third party authority to force people to respect property rights and fulfill contracts, cooperation is impossible and society breaks down into chaos.

When we observe governments and intranational anarchy around the world, the extreme Hobbesian prediction is clearly wrong. The internal relations of most governments, though anarchic, are fairly peaceful, and politicians do not battle each other in a war of all against all. So the question is: given that the internal relationships of a government are anarchic, how can cooperation and social order within a government be secured?

We know that the strict Hobbesian position is false. In small groups with repeated interactions and low discount rates, people will self-interestedly cooperate and respect contracts. Under these conditions, social order is possible without a state.

Can the logic of repeated interactions and reputation be used to explain social order in intranational anarchy? The answer seems to be yes.

The number n of the true rulers of the state, those who control its coercive power, appears to be small enough for repeated interaction to generate cooperation. And in running the government, the rulers are in fact in repeated interactions with each other, so cooperation would be the dominant strategy.

In addition, the nature of the organization of the state can explain cooperation. By cooperating to run the government, the rulers can enrich themselves by taxing the general population; by comparative advantage, this would be their most profitable employment. Hence a sort of honor among thieves brings incentives to cooperate.

One problem with this explanation is drawing the boundary between the rulers and the ruled. How do we identify the individuals that make up n? At what point does a government agent cease to be a ruler and become one of the ruled? A general in the military is definitely one of the rulers. A low-level bureaucrat in the post office is definitely one of the ruled. So the dividing line must be somewhere between the two. It seems that control over the coercive power of the state is the key. The more such control a government agent has, the more they are part of the rulers.

In sum, thinking about how government agents cooperate in intranational anarchy can illuminate our understanding of the state. One question for future research is explaining how the police and the military, as agencies of organized violence, can cooperate with each other.

Public Goods and the Presumption of Markets

January 4, 2011 1 comment

A widely held view in economics is that public goods must be provided by government. In other words, a sufficient condition for government intervention is that a good possesses the characteristics of nonrivalry and nonexcludability. If a good qualifies as “public,” there is a presumption that government intervention is justified.

I claim that this view is misguided. Specifically, I think there should be a presumption of market provision of public goods. Rather than automatically assuming that “publicness” justifies government provision, we should start from the position of market provision of public goods, and place the burden of proof on the advocate of government intervention.

The market is a self-correcting system: inefficiencies on the market create incentives for entrepreneurs to solve them. Of course, the whole point of public goods is that while entrepreneurs have the incentives to find a solution, they are unable to do so: free riders cannot be excluded, and hence it is unprofitable to produce the optimal amount.

This analysis, however, assumes that the ability to exclude nonpayers is a technological given. But in reality this is not true; technology is not fixed, but constantly changing. If it is not presently feasible to exclude free riders, then entrepreneurs will be looking for new exclusion technologies that allow them to capture the gains from trade. Excludability depends on technology; but since technology changes, new exclusion mechanisms can arise, meaning that the publicness of a good is not a fixed factor.

As a result, government provision of public goods will produce a crowding out effect. When government monopolizes the production of a good, entrepreneurs no longer have an incentive to engage in the creative discovery process of developing new exclusion technologies. Government intervention stifles innovation, and goods that could have become private will remain public. Hence the publicness of many goods provided by government is actually the result of their public provision, and not the cause of it. Government intervention becomes a self-fulfilling prophecy: markets cannot solve collective action problems because government crowds out market solutions.

But the most important reason for the presumption of markets is the fallacy of appeal to personal incredulity. This occurs when one reasons from “I cannot imagine how markets could provide this good” to “markets cannot provide this good.” But in fact an economist’s ability to diagnose public goods problems depends on their entrepreneurial ability.

Suppose an economist is also a creative and imaginative entrepreneur. When faced with a potential public goods problem, they will be able to imagine how markets could solve the problem through property or contract mechanisms, and so will reject government intervention as inefficient. But if, on the other hand, the economist is an incompetent entrepreneur, they will call for central planning simply because they personally cannot imagine any property or contractual solutions to the particular problem.

A very good example is James Meade, who argued that the positive externalities associated with honey bees would result in inefficient production of crops and honey. Because of the public goods problem, Meade argued, government intervention was necessary. In the real world, however, contracts between beekeepers and farmers solving this problem were commonplace. Meade’s failure of imagination led him to advocate unnecessary and inefficient government intervention.

Since creativity and imagination are scarce, economists are likely to be biased, as Meade was, in favor of government intervention. They will tend to underestimate the ability of property and contract mechanisms to solve supposed market failures. I submit that, to correct for this statist bias, there should be a presumption of markets. (In similar fashion, Bryan Caplan argues for a presumption of elasticity.) If we take into account the changeable nature of exclusion technology, the crowding out effect of government intervention, and the fallacy of appeal to personal incredulity, we find that the presumption should be in favor of markets, and that proponents of government intervention should bear the burden of proof.

Of course, this presumption is defeasible. Government provision of public goods can be efficient. The point of the presumption is to take into account and correct for interventionist bias. How can the presumption of markets be overcome? At the very least, proponents of government intervention have to do more than merely show that a public good exists. That was Meade’s error. I suggest that economists should: first, look at the real world to see if the problem really exists; and second, actually investigate possible market solutions before proclaiming “market failure!” This is an imperfect solution, but at least it’s a step in the right direction.