DemocracyThe God That Failed
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1James M. Buchanan and Gordon Tullock, The Calculus of Consent (Ann Arbor: University of Michigan Press, 1962); James M. Buchanan, The Limits of Liberty (Chicago: University of Chicago Press, 1975); for a critique see Murray N. Rothbard, "Buchanan and Tullock's Calculus of Consent," in idem, The Logic of Action Two (Cheltenham, U.K.: Edward Elgar, 1995); idem, "The Myth of Neutral Taxation," ibid.; Hans-Hermann Hoppe, The Economics and Ethics of Private Property (Boston: Kluwer, 1993), chap. 1.
2See on this in particular Lysander Spooner, No Treason: The Constitution of No Authority (Larkspur, Colo.: Pine Tree Press, 1966).
Let me interrupt my discussion and return to the reconstruction of the Hobbesian myth. Once it is assumed that in order to institute peaceful cooperation between A and B it is necessary to have a state S, a two-fold conclusion follows. If more than one state exists, SI, S2, S3, then, just as there can presumably be no peace among A and B without S, so can there be no peace between the states SI, S2, and S3 as long as they remain in a state of nature (i.e., a state of anarchy) with regard to each other. Consequently, in order to achieve universal peace, political centralization, unification, and ultimately the establishment of a single world government, are necessary.
It is useful to indicate what can be taken as noncontroversial. To begin with, the argument is correct, as far as it goes. If the premise is correct, then the consequence spelled out does follow. As well, the empirical assumptions involved in the Hobbesian account appear at first glance to be borne out by the facts. It is true that states are constantly at war with each other, and a historical tendency toward political centralization and global rule does indeed appear to be occurring. Quarrels arise only with the explanation of this fact and tendency, and the classification of a single unified world state as an improvement in the provision of private security and protection. There appears to be an empirical anomaly for which the Hobbesian argument cannot account. The reason for the warring among different states SI, S2, and S3, according to Hobbes, is that they are in a state of anarchy vis-a-vis each other. However, before the arrival of a single world state not only are SI, S2, and S3 in a state of anarchy relative to each other but in fact every subject of one state is in a state of anarchy vis-a-vis every subject of any other state. Accordingly, just as much war and aggression should exist between the private citizens of various states as between different states. Empirically, however, this is not so. The private dealings between foreigners appear to be significantly less war-like than the dealings between different governments. Nor does this seem to be surprising. After all, a state agent S, in contrast to everyone of its subjects, can rely on domestic taxation in the conduct of his "foreign affairs." Given his natural human aggressiveness, is it not obvious that S will be more brazen and aggressive in his conduct toward foreigners if he can externalize the cost of such behavior onto others? Surely, I would be willing to take greater risks and engage in more provocation and aggression if I could make others pay for it. And surely there would be a tendency of one state—one protection racket—to want to expand its territorial protection monopoly at the expense of other states and thus bring about world government as the ultimate result of interstate competition.3 But how is this an improvement in the provision of private security and protection? The opposite seems to be the case. The world state is the winner of all wars and the last surviving protection racket. Doesn't this make it particularly dangerous? Will not the physical power of any single world government be overwhelming as compared to that of any one of its individual subjects?
II
Let me pause in my abstract theoretical considerations to take a brief look at the empirical evidence bearing on the issue at hand. As noted at the outset, the myth of collective security is as widespread as it is consequential. I am not aware of any survey on this matter, but I would venture to predict that the Hobbesian myth is accepted more or less unquestioningly by well over 90 percent of the adult population; that a state is indispensable for protection and defense. However, to believe something does not make it true. Rather, if what one believes is false, one's actions will lead to failure. What about the evidence? Does it support Hobbes and his followers, or does it confirm the opposite anarchist fears and contentions?
The U.S. was explicitly founded as a "protective" state a la Hobbes. Let me quote to this effect from Jefferson's Declaration of Independence:
We hold these truths to be self-evident: that all men are created equal; that they are endowed by their Creator with inalienable rights; that among these are life, liberty, and the pursuit of happiness: that to secure these rights, governments are instituted among men, deriving their just powers from the consent of the governed.
Here we have it: The U.S. government was instituted to fulfill one and only one task: the protection of life and property. Thus, it should provide the perfect example forjudging the validity of the Hobbesian claim as to the status of states as protectors. After more than two centuries of protective statism, what is the status of our protection and peaceful human cooperation? Was the American experiment in protective statism a success?
According to the pronouncements of our state rulers and their intellectual bodyguards (of whom there are more than ever before), we are better protected and more secure than ever. We are supposedly protected from global warming and cooling, from the extinction of animals and plants, from the abuses of husbands and wives, parents and employers, from poverty, disease, disaster, ignorance, prejudice, racism, sexism, homophobia, and countless other public enemies and dangers. In fact, however, matters are strikingly different. In order to provide us with all this 'protection,' the state managers expropriate more than 40 percent of the incomes of private producers year in and year out. Government debt and liabilities have increased uninterruptedly, thus increasing the need for future expropriations. Owing to the substitution of government paper money for gold, financial insecurity has increased sharply, and we are continually robbed through currency depreciation. Every detail of private life, property, trade, and contract is regulated by ever higher mountains of laws (legislation), thereby creating permanent legal uncertainty and moral hazard. In particular, we have been gradually stripped of the right to exclusion implied in the very concept of private property. As sellers we cannot sell to and as buyers we cannot buy from whomever we wish. And as members of associations we are not permitted to enter into whatever restrictive covenant we believe to be mutually beneficial. As Americans, we must accept immigrants we do not want as our neighbors. As teachers, we cannot get rid of ill-behaved students. As employers, we are stuck with incompetent or destructive employees. As landlords, we are forced to cope with bad tenants. As bankers and insurers, we are not allowed to avoid bad risks. As restaurant or bar owners, we must accommodate unwelcome customers. And as members of private associations, we are compelled to accept individuals and actions in violation of our own rules and restrictions. In short, the more the state has increased its expenditures on 'social' security and 'public' safety, the more our private property rights have been eroded, the more our property has been expropriated, confiscated, destroyed, or depreciated, and the more we have been deprived of the very foundation of all protection: economic independence, financial strength, and personal wealth.4 The path of every president and practically every member of Congress is littered with hundreds of thousands of nameless victims of personal economic ruin, financial bankruptcy, emergency, impoverishment, despair, hardship, and frustration. The picture appears even bleaker when we consider foreign affairs. Seldom during its entire history has the continental U.S. been territorially attacked by any foreign army. (Pearl Harbor was the result of a preceding U.S. provocation.) Yet the U.S. has the distinction of having had a government that declared war against a large part of its own population and engaged in the wanton murder of hundreds of thousands of its own citizens. Moreover, while the relations between American citizens and foreigners do not appear to be unusually contentious, almost from its very beginnings the U.S. government relentlessly
pursued aggressive expansionism. Beginning with the Spanish-American war, reaching a peak in World War I and World War II, and continuing to the present, the U.S. government has become entangled in hundreds of foreign conflicts and risen to the rank of the world's dominant imperialist power. Thus, nearly every president since the turn of this century has also been responsible for the murder, killing, or starvation of countless innocent foreigners all over the world. In short, while we have become more helpless, impoverished, threatened and insecure, the U.S. government has become ever more brazen and aggressive. In the name of "national" security, it "defends" us, equipped with enormous stockpiles of weapons of aggression and mass destruction, by bullying ever new "Hitlers," big or small, and all suspected Hitlerite sympathizers anywhere and everywhere outside of the territory of the U.S.5
3See Hans-Hermann Hoppe, "The Trouble with Classical Liberalism," Rothbard-Rockwell Report 9, no. 4 (1998).
4See Hans-Hermann Hoppe, "Where the Right Goes Wrong," Rothbard-Rockwell Reports, no .4 (1997).
The empirical evidence thus seems clear. The belief in a protective state appears to be a patent error, and the American experiment in protective statism a complete failure. The U.S. government does not protect us. To the contrary, there exists no greater danger to our life, property, and prosperity than the U.S. government, and the U.S. president in particular is the world's single most threatening and armed danger, capable of ruining everyone who opposes him and destroying the entire globe.
Ill
Statists react much like socialists when faced with the dismal economic performance of the Soviet Union and its satellites. They do not necessarily deny the disappointing facts, but they try to argue them away by claiming that these facts are the result of a systematic discrepancy (deviancy) between "real" and "ideal" or "true" statism (respectively socialism). To this day, socialists claim that "true" socialism has not been refuted by the empirical evidence, and that everything would have turned out well and unparalleled prosperity would have resulted if only Trotsky's, or Bukharin's, or better still their very own brand of socialism, rather than Stalin's, had been implemented. Similarly, statists interpret all seemingly contradictory evidence as only accidental. If only some other president had come to power at this or that turn in history or if only this or that constitutional change or amendment had been adopted, everything would have turned out beautifully, and unparalleled security and peace would have resulted. Indeed, this may still happen in the future, if their own policies are employed.
5See The Costs of War: America's Pyrrhic Victories, John V. Denson, ed. (New Brunswick, NJ: Transaction Publishers, 1997); idem,"ACentury of War: Studies in Classical Liberalism" (Auburn, Ala.: Ludwig von Mises Institute, 1999). Since the end of World War II, for instance, the United States government has intervened militarily in China (1945-16), Korea (1950-53), China (1950-53), Iran (1953), Guatemala (1954), Indonesia (1958), Cuba (1959-60), Guatemala (1960), Congo (1964), Peru (1965), Laos (1964-73), Vietnam (1961-73), Cambodia (1969-70), Guatemala (1967-69), Grenada (1983), Lebanon (1983), Libya (1986), El Salvador (1980s), Nicaragua (1980s) Panama (1989), Iraq (1991-99), Bosnia (1995), Sudan (1998), Afghanistan (1998), and Yugoslavia (1999). Moreover, the United States government has troops stationed in nearly one-hundred-fifty countries around the world.
We have learned from Ludwig von Mises how to respond to the socialists' evasion (immunization) strategy.6 As long as the defining characteristic—the essence—of socialism, i.e., the absence of the private ownership of factors of production, remains in place, no reform will be of any help. The idea of a socialist economy is a contradiction in terms, and the claim that socialism represents a 'higher,' more efficient mode of social production is absurd. In order to reach one's own ends efficiently and without waste within the framework of an exchange economy based on division of labor, it is necessary that one engage in monetary calculation (cost-accounting). Everywhere outside the system of a primitive self-sufficient single household economy, monetary calculation is the sole tool of rational and efficient action. Only by comparing inputs and outputs arithmetically in terms of a common medium of exchange (money) can a person determine whether his actions are successful or not. In distinct contrast, socialism means to have no economy, no economizing, at all, because under these conditions monetary calculation and cost-accounting is impossible by definition. If no private property in factors of production exists, then no prices for any production factor exists, hence, it is impossible to determine whether or not they are employed economically. Accordingly, socialism is not a higher mode of production but rather economic chaos and regression to primitivism.
How to respond to the statists' evasion strategy has been explained by Murray N. Rothbard.7 But Rothbard's lesson, while equally simple and clear and of even more momentous implications, has remained to this day far less known and appreciated. So long as the defining characteristic—the essence—of a state remains in place, he explained, no reform, whether of personnel or constitutional, will be to any avail. Given the principle of government—judicial monopoly and the power to tax—any notion of limiting its power and safeguarding individual life and property is illusory. Under monopolistic auspices the price of justice and protection must rise and its quality must fall. A tax-funded protection agency is a contradiction in terms and will lead to ever more taxes and less protection. Even if a government limited its activities exclusively to the protection of preexisting property rights (as every "protective" state is supposed to do), the further question of how much security to provide would arise. Motivated (like everyone else) by self-interest and the disutility of labor but with the unique power to tax, a government's answer will invariably be the same: to maximize expenditures on protection—and almost all of a nations' wealth can conceivably be consumed by the cost of protection—and at the same time to minimize the production of protection. Furthermore, a judicial monopoly must lead to a deterioration in the quality of justice and protection. If one can only appeal to government for justice and protection, justice and protection will be perverted in favor of government, constitutions and supreme courts notwithstanding. After all, constitutions and supreme courts are state constitutions and courts, and whatever limitations to government action they might contain is determined by agents of the very institution under consideration. Accordingly, the definition of property and protection will continually be altered and the range of jurisdiction expanded to the government's advantage.
6Ludwig von Mises, Socialism: An Economic and Sociological Analysis (Indianapolis, Ind.: Liberty Classics, 1981); Hans-Hermann Hoppe, A Theory of Socialism and Capitalism (Boston: Kluwer, 1989), chap. 6.
7Murray N. Rothbard, The Ethics of Liberty (New York: New York University Press, 1998), esp. chaps. 22 and 23.
Hence, Rothbard pointed out, it follows that just as socialism cannot be reformed but must be abolished in order to achieve prosperity, so can the institution of the state not be reformed but must be abolished in order to achieve justice and protection. "Defense in the free society (including such defense services to person and property as police protection and judicial findings)," Rothbard concluded,
would therefore have to be supplied by people or firms who (a) gained their revenue voluntarily rather than by coercion and (b) did not—as the State does—arrogate to themselves a compulsory monopoly of police or judicial protection.... defense firms would have to be as freely competitive and as noncoercive against noninvaders as are all other suppliers of goods and services on the free market. Defense services, like all other services, would be marketable and marketable only.8
8Murray N. Rothbard, Power and Market (Kansas City: Sheed Andrews and McMeel,1977),p.2.
That is, every private property owner would be able to partake of the advantages of the division of labor and seek better protection of his property than that afforded through self-defense by cooperation with other owners and their property. Anyone could buy from, sell to, or otherwise contract with anyone else concerning protective a
nd judicial services, and one could at any time unilaterally discontinue any such cooperation with others and fall back on self-reliant defense or change one's protective affiliations.