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The Essence of Libety

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Liberty knows no compromise

A Condensed Version of For a New Liberty: The Libertarian Manifesto by Murray N. Rothbard

Compiled by

Dr. Jimmy T. (Gunny) LaBaume

Chapter 12: The Public Sector, III: Police, Law, and the Courts

Police Protection

A common fallacy is that government must supply "police protection." In actual fact there is no absolute or fixed commodity called "police protection." There are almost infinite degrees of protection—everything from a policeman who patrols once a night to round-the-clock personal bodyguards. With this in mind, the question of how police should allocate their funds becomes problematic. Is it electronic or fingerprinting equipment? Plain clothes detectives or uniformed police? Patrol cars or foot patrolmen, etc?

Since government has no objective indicator of efficiency, it has no rational way to allocate a limited budget. Consequently, allocations are subject to politics, boondoggling, and bureaucratic inefficiency. By contrast, if services were supplied on the free market, consumers would pay for whatever degree of protection they wanted. Efficiency would be insured by the desire to make a profit, keep costs low and serve the consumers.

Deciding what laws really to enforce is a problem for government police. Theoretically, they are supposed to "enforce all laws" but the limits of their budget force them to allocate. Furthermore, the absolute dictum to “enforce all laws” works against any rational allocation of resources. On the free market each customer individually decides how much of what kind of protection he is willing to pay for.

Free-market police would not only be efficient, they would have an incentive to be courteous and refrain from brutality. On the market there is no disjunction between service and payment that is inherent in all government operations. Free market competitors acquire their revenue through voluntary exchange. Government acquires its revenue, not voluntarily but coercively from taxpayers.

In fact, as government police become more and more inefficient, consumers have been purchasing more and more private forms of protection—neighborhood watches, private security guards, insurance companies, private detectives, and sophisticated security equipment.

It is common knowledge that insurance detectives are far more efficient than the police in recovering stolen property. This is simply because the insurance company is motivated by economics to serve the consumer as well as avoid paying benefits. As a result, its primary concern is recovering the loot with criminal punishment being secondary. Again by contrast, since police represent a mythical "society," they are more interested in catching and punishing the criminal than they are in recovering stolen property.

It is impossible to describe a market that exists only as an hypothesis. However, it seems reasonable to believe that police protection would be provided by landowners and/or insurance companies with services being paid for in regular monthly premiums. Since they would otherwise be paying benefits to victims, preventing crime would certainly be in an insurance company's best interest.

Normally a person who wants to be protected would pay premiums in advance instead of waiting to be attacked. Furthermore, common street crime would likely be taken care of by whoever owns the street. But suppose, for example, an unlikely event occurs where someone is being mugged on the street. It is very likely that private police companies would want to cultivate goodwill by making it a policy to provide free aid to victims in such emergency situations.

Competition insures efficiency, low price, and high quality. There is no reason to assume that there is anything sacred about having only one police agency. Some economists hold that the provision of certain goods or services is a "natural monopoly" and that, therefore, more than one private agency could not survive for long. Maybe. However, only a totally free market could decide that for sure. Furthermore, there is no reason to believe that police protection is a "natural monopoly." Insurance companies are certainly not, so why not Metropolitan, Equitable, and Prudential police protection companies? Furthermore, modern technology makes establishment of branch offices of large urban firms possible even in the most remote rural areas.

But, if police protection was private, how could the poor afford it? In the first place, the same question could be asked about any good or service. But, you say, protection is necessary. Well, so is food, clothing and shelter but hardly anybody advocates government nationalization of these goods. Just as with these essentials, very poor people would be supplied with police protection by private charity—for example by private security firms voluntarily supplying free police protection to the indigent for goodwill (as hospitals and doctors do now) or by special "police aid" societies similar to the "legal aid" societies we have already.

As it is now, police services are paid for by the taxpayer who very often is the poor man himself. In fact, he may very well be paying more in taxes now than he would in fees to more efficient companies. Furthermore, this would be a massive market meaning very large economies of scale. As a result, protection would be much cheaper. In fact, insurance would likely be much cheaper than it is now because the industry is very heavily regulated in order to keep out the low-cost competition.

But, you object, wouldn't clashes between agencies lead to "anarchy" and perpetual conflicts between the police forces?

Well first, since there would be no State (or central government), we would at least be spared the horror of inter-State wars fought with massive, super-destructive weapons. All of history bears out that the number of people killed in neighborhood (or tribal) disputes is negligible when compared to the mass devastation of inter-State wars. The only clashes that could break out would be local and even then the weaponry would be limited in scope and devastation. Two police agencies could not use mass bombing, nuclear or germ warfare against each other because they themselves would be destroyed in the process.

Furthermore, as it is now, every person is a subject of a monopoly government. As such, he becomes irretrievably identified with "his" government. So, if another government attacks, it will attack the citizenry as well as its government. On the other hand, if Company A does battle with Company B, the most that can happen is that their respective customers (and no one else) may be dragged into the fight. So although this local "anarchy" would not be likely to occur, even if it did, we would still be much better off than we are now.

Why is anarchy not likely? In the first place, every police agency would be aware of the fact that customers want protection that is efficient and quiet. Obviously clashes would devastate their business so it is absurd to think that they would want to deter from their own efficiency and disrupt the quiet by continuously clashing. Such conflicts would simply be bad for business and, if they did occur, they would likely be ironed out in private courts.

To be even more specific, suppose that two neighbors accuse each other of assault or violence. They subscribe to different police companies and each calls his own company. It would be pointless (as well as economically and physically self-destructive) for the two companies to shoot it out. Instead, they would use private courts or arbitrators to decide who is in the wrong. In fact, this would be advertised as a vital part of its service.

The Courts

Suppose that the judge decides Smith was wrong in a neighborly dispute. If Smith accepts the verdict, then there is no problem. Or, suppose Jones is robbed and his police company decides Brown did it. Again, if Brown admits to the robbery, there is no problem. But if Smith doesn't accept the verdict or Brown do not agree with the police, then what?

We are now out of the realm of police protection and into that of judicial services. How can courts be private? How can private courts employ force without government?

Well first, the government's monopoly courts suffer from the same inefficiencies and contempt for the consumer as any other government operation. Judges are not selected for their legal wisdom. They are political hacks. Furthermore, since these courts are monopolies, if they become corrupt, the citizen has no recourse. Finally, there is no reason to believe that judicial wisdom is some sort of "natural monopoly."

How would private courts be financed? Only the market will be able to ultimately determine the most appropriate way. But, there are numerous possibilities. For example: Each individual might subscribe to a court service by paying a monthly premium. Or, he might pay a fee but only whenever he uses the court. Then, the criminal or contract-breaker would be held liable for recompensing the victim or plaintiff. Or as a third possibility, the courts may be hired by the police agencies to settle disputes. Or, "vertically integrated" firms might emerge that would supply both police and judicial service.

In recent years, the use of private arbitrators has been growing. For example, insurance companies adjust large numbers of claims every year through voluntary arbitration. Being voluntary, the rules of arbitration can be decided quickly by the parties themselves without having to have a ponderous, complex legal framework. Furthermore, arbitration permits judgments by people expert in the trade or occupation concerned.

Detractors would be quick to point out that private arbitrators' decisions are still enforced by the courts. This is true. However, it was not the case before 1920. Arbitration began in England during the American War of Yankee Aggression with private courts being provided by voluntary arbitrators, even though the decisions were not legally binding. In fact, the entire body of merchant law grew up in private courts although the decisions were not legally binding.

So, how could such courts have been successful? Merchants relied entirely on ostracism and boycott by other merchants. Should a merchant refuse to submit or ignore a decision, the other merchants would publish this fact and refuse to deal with him. So, even though the offending merchant would not be sent to jail, neither would he continue to be a merchant for very long. With modern technology, ostracism could be even more effective. Anyone who ignored an arbitrator's award would never again be able to use an arbitrator's services.

So you say, even if sufficient for commercial disputes, what about criminal activities where ostracism would probably not be enough? Would courts and legal enforcement not become necessary? Otherwise, how would the courts enforce their decisions?

In a libertarian (free) society, no physical force may be used against anyone who has not been convicted of a crime. If it turned out the accused was innocent, the users of such force could be convicted as aggressors themselves. Unlike the government's court system, no cop or judge would have special immunity for the use of coercion beyond what anyone else could use.

Suppose Jones is robbed. His detective agency decides that Brown did it. Brown refuses to admit his guilt. So what now? First, recognize that presently there is no overall world court or world government enforcing its decrees. In other words, we live in a state of "international anarchy." Even so, there is little or no problem with disputes between private citizens of the various countries. If a citizen of country A is swindled by a citizen of country B, the rational thing for him to do is to go to his own court. Since he is the one who is aggrieved, it is natural that he take his case to his own court. So, in our example, Jones would go to his court company (the Prudential Court Company) to charge Brown with theft.

If Brown is also a client of the Prudential Court , there is no problem. The Prudential decision would be binding. Consistent with the non-aggression axiom, no coercive subpoena power could be used against Brown because he is considered innocent until convicted. Instead, he would be served with a notice that he is invited to voluntarily appear. If he does not, he will be tried in absentia. This, of course, would be less favorable to him since his side would not be presented. Then, if he is found guilty, the court and its marshals will employ force to seize him and exact whatever punishment the court has decided upon. This punishment would focus on restitution to the victim.

But what if Brown is a client of the Metropolitan Court Company and not Prudential? First, Jones would plead his case in Prudential Court . If Brown is found innocent, that is the ends of it. If he is found guilty and does nothing, the court's judgment proceeds against him. On the other hand he might take his case to the Metropolitan Court to be heard. If it also finds him guilty, this too would end the controversy and Prudential will proceed against him. But suppose Metropolitan finds Brown innocent? Will the marshals of the two courts shoot it out in the streets?

No. That would amount to irrational and self-destructive behavior on both sides. An essential part of any judicial service is the provision of just, objective, and peacefully functioning decisions. Therefore, any court's service agreement would contain an appeals procedure. Every court would agree to abide by the decision of a voluntary and mutually agreed upon arbitrator. The result of this third trial would be binding.

There is nothing in this system that would require any one court to be the court of appeal. In contrast to the government's system, the competing private courts could go to any appeals judge they think fair, expert, and objective. No appeals judge (or judges) would be forced upon society by coercion.

There would be many ways that these appellate judges could be financed. But, most likely the original courts would include a charge for appeals services in their premiums.

But couldn't Brown escape judgment by just continuing to appeal indefinitely? There must be some stopping point. Since there are only two parties to any crime or dispute, it seems sensible that a decision arrived at by any two courts would be binding. This criteria would be met when both the plaintiff's and the defendant's courts come to the same decision. It would also be met when an appeals court rules on a disagreement between the two original courts.

The Law and the Courts

The libertarian society will have to have a legal code. But how can that happen without a government?

This legal code would insist on the libertarian principle of non aggression. It would define property rights, set up rules of evidence, and a code of maximum punishment. Then, within this framework, courts would compete and the market would decide whether judges, juries, etc. are the most efficient means for providing judicial services.

Such a law code is indeed possible. Government is no more qualified to develop and apply law than it is to provide any other service. In fact, over the years, the best parts of our legal system were developed exactly this way. For example: the entire law merchant was developed by private merchant courts. It was only much later that government took it over. The same occurred with admiralty law. The shippers themselves took on the task and it was only later that the government appropriated admiralty law into its courts.

Furthermore, “the major body of Anglo-Saxon law, the justly celebrated common law , was developed over the centuries by competing judges applying time-honored principles rather than the shifting decrees of the State.” Judges did not make law (as they do today). Instead, their job was to find the law in accepted common law principles, and then apply that law to specific cases or new conditions. These judges functioned like private arbitrators. There was no arbitrarily imposed "supreme court." Furthermore, although precedent was honored, it was not automatically considered to be binding.

The imposition of judge's personal views was kept to a minimum in three ways: 1) they could only make decisions when private citizens brought cases to them; 2) the judge's decision applied only to that particular case; and 3) decisions always considered the precedents of the centuries.

I the private law area, ancient Roman judges functioned the same way as the English common law courts. Under the concept of the certainty of law, nobody enacted law and nobody could change it by exercise of his individual will. The law was something to be described or discovered. It was not something to be enacted.

In a libertarian society, the people themselves will appoint the judges simply by patronizing the ones with the best reputation for knowing and applying the basic common law principles of the society. In other words, selection of the judiciary would be based on the widespread consent of clients, colleagues, and the public at large.

Rather than tradition, the basic libertarian legal code would be established on the basis of the libertarian principles of nonaggression and reason. We already have a body of common law principles. Therefore, applying reason to correct and amend these principles would be much easier than creating a systematic body of law from scratch.

Ancient Ireland is the most remarkable historical example of a purely state-less society where the courts and the law were libertarian. It survived for about a thousand years until its brutal conquest by England in the 17 th Century. Although there was no sign of State-administered justice, this was not a "primitive" society. It was highly complex and the most advanced, scholarly, and civilized in Western Europe for centuries. The basic political unit was the tuath, which was composed of the "freemen" who owned land, professionals, and craftsmen. An annual assembly made policies, declared war (or made peace) on other tuatha , and elected (or deposed) "kings." No one was bound to a given tuath. Individual members were free to secede and join another tuath. It was simply a group of persons who voluntarily united for socially beneficial purposes. Its territorial dimension was the total of the landed properties of its members. About 80 to 100 of these coexisted throughout Ireland at any given time.

The king primarily functioned as a religious high priest. His function was hereditary as he was elected from within a royal kin-group. But he had strictly limited political functions. He could only conduct negotiations as the agent of the assemblies and in no sense was he sovereign. He could not legislate and, when party to a lawsuit, he had to submit his case to an independent arbiter.

The law itself was based on ancient custom which was passed down through professional jurists called the brehons. These men were selected by parties to disputes based on their reputations for wisdom, knowledge, and integrity. They had no connection whatsoever with individual tuatha or their kings. They were completely private and national in scope. There were no other judges of any kind in ancient Ireland . There was no monopoly of the brehon jurists. Competing schools of jurisprudence existed and competed for the custom of the Irish people.

Their decisions were enforced through a voluntary system of "insurance" or sureties. Men were linked together by a variety of surety relationships. The brehons themselves were not involved in enforcement. That was in the hands of private individuals linked through sureties. This system applied to all offences, “civil" or "criminal." Criminals were considered to be "debtors" who owed restitution to their victims. The victim would gather his sureties, proclaim his suit in public and demand that the defendant submit to adjudication. The criminal could send his own sureties to negotiate a settlement or he could agree to submit the dispute to the brehons. If he did neither, he was considered an "outlaw." As such he could no longer enforce any claim of his own in the courts and was ostracized by the community.

Only the coercive State can, through taxation and conscription, mobilize large amounts of arms and manpower. Therefore, the occasional Irish "wars" were minor brawls compared to the devastation that racked the rest of Europe.

Thus, history supports the theory. It is entirely possible to have efficient and courteous police, competent judges and a socially acceptable body of law—none of which are furnished by a coercive government. Government is no more necessary for providing protective and adjudicative service than it is for anything else.

Outlaw Protectors

Objectors to the purely libertarian society raise the possibility of police, judges and courts being biased and making their decisions in favor of wealthy clients or of one or more of them becoming outlaws. Granted, we can not assume that a free society will also bring with it a magically transformed Libertarian Man. But, given any particular degree of man's "goodness" or "badness," such a society will certainly be the most moral, efficient, secure and the least criminal.

First consider the crooked judge who might favor his own wealthy client. In the first place, this would be highly unlikely due to the fact that the livelihood of the judge would depend on his reputation, his "brand name" so to speak—without which he would no longer have customers.

Contrast this free market corrective mechanism to today's government courts. Judges are appointed or elected for long terms—sometimes life. They are awarded a monopoly of decision-making in their area. Consequently it is almost impossible to do anything about corrupt decisions. This power continues unchecked year after year while their salaries continue to be paid by coercion of the hapless taxpayer.

Furthermore, most business firms in the free market do not earn their keep from wealthy customers. They earn it from the mass market. The same would hold for any private court system. Contrast this with the present where judges, like all politicians, are beholden to wealthy contributors to their political parties.

It is claimed that America has a system of "checks and balances" so that power cannot unduly accumulate in one set of hands. But that is a myth. The system is largely a fraud. Each one of the “checks” (branches of government) is itself a coercive monopoly and all are part of the same government. At best, there are only two, often colluding, parties and both are very close in ideology. Furthermore, the day-to-day business of government is conducted by a bureaucracy that cannot be displaced by the voters. Contrast this situation to the real checks and balances provided by the free-market. The competition of other grocery chains is what keeps A&P honest. In the same way, the possibility of customers cutting off their business is what would keep free-market judges honest.

The same type of analysis applies to a private police force. It is possible that a renegade force might set up a "protection racket" to shake down its customers. If that should happen, not only would it loose customers, other police forces could (and probably would) band together to quell the aggressors. Contrast this with the State. If gangsters capture the State's coercive apparatus (and consequently its weapons), there is not much that can be done short of revolution.

After all the State is nothing but organized banditry anyway. It commits theft on a gigantic scale and calls it taxation, mass murder and calls it war, and mass enslavement and calls it conscription. It is impossible to envision a private police force that could get away with a tiny fraction of these crimes.

Another consideration is the sense of government legitimacy held by the stupefied public that has been indoctrinated by centuries of propaganda. A propaganda fostered by the State's intellectuals and aided by the trappings of legitimacy—flags, rituals, ceremonies, awards, constitutions, etc. No gang of bandits— even one composed of all the private police forces conspiring together—could ever command such legitimacy. The public would quickly recognize them as bandits and they would be overthrown.

But suppose that despite all these built in, free market controls, the State managed to reestablish itself. All that would mean is that we would simply have a State again. We would be no worse off than we already are now and "at least the world will have had a glorious holiday."

National Defense

The final argument against a libertarian society that usually has to be made is how such a society could defend us against the Russians. (Rothbard was writing back in the days of the Cold War.)

This argument is based on several dubious assumptions. First is the assumption that the Russians are bent upon military invasion, which is doubtful at best. Then there is the assumption that such a desire would remain after the united States becomes a libertarian society. Again, this is highly unlikely because wars are a result of conflicts between nation-states. Nation-states are inherently threatening. Since America would no longer be a nation-state, it would be a threat to no one.

One of the greatest evils of the nation-state is that the State is able to identify all of its subjects with itself. This renders innocent civilians subject to enemy aggression in any inter-State war. In a libertarian society, there would be no such identification.

Furthermore, suppose for example, that the outlaw “Metropolitan Police Force” initiates aggression against Americans and Mexicans. If Mexico still had a government, it would know that Americans in general were not involved in the aggression and therefore would not likely go to war with Americans in general. In fact, it is likely that American forces would join the Mexicans in putting down the aggressor. In short, the idea of inter-State war would most likely disappear.

A libertarian society, once instituted, could work, be viable, more efficient, prosperous, moral, and free than any other social system. But we have said nothing about how to get from the present system to the ideal. The Russian question assumes that libertarianism has been established only in America and nowhere else. We should not assume that. The libertarian philosophy is eternal and universal—not bound by time or place. We advocate liberty for everyone everywhere. Let them join us in accepting liberty as our ideal goal, and then in the separate—and difficult—task of figuring out how to achieve this ideal.

So now let us move on to strategy. The larger an area in which liberty is established the better its chances for survival and resistance to violent overthrow. If liberty is established instantaneously all over the world, there would be no problem of "national defense." All problems would be local police problems. But, if Deep Falls , Wyoming should secede, the chances are good that the uS government, considering its historical ferocity toward secessionists, would crush the new free society. Between these two polar cases, there is an infinite continuum of degrees and, as a matter of strategy, the larger the area the better..

Be all this as it may, let's consider the Russian question anyway. Assume the Soviet Union is hell-bent on attacking our libertarian population. Since, there would no longer be a uS government, the form of defense would be decided upon by consumers. Thus, various defense theories would be applied in proportion to those who support the different theories being offered. Furthermore, private, voluntary defense efforts would be far more efficient than government boondoggles and certainly more moral.

But, let's assume the worst—that the Soviet Union invades and conquers our territory. The primary reason any conquering country can rule a defeated country is that “the latter has an existing State apparatus to transmit and enforce the victor's orders onto a subject population.” In those cases in history where the conquered had no government, the conquerors found it very difficult to rule. For example, this is perhaps the main reason it took the English centuries to conquer ancient Ireland . They just could never seem to understand that the Irish warriors who concluded treaties with them only spoke for themselves. They had no State to speak for.

Furthermore, guerilla warfare by the American population would inevitably erupt. One of the lessons of the 20 th is that no occupying force can long keep down a native population determined to resist. This was driven home when the giant uS attempted to invade the tiny and relatively unarmed Vietnamese. (Editor's Note: The lesson is currently being re-learned by that same giant uS in Iraq.) Guerrilla warfare is an irresistible force precisely because it does not stem from a dictatorial central government but from the people themselves.

Continue to the next chapter...

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