The Relevance of Anarchy, Again

I’ve read through Bruce’s and Pete’s responses to my comments — I admit I was trying to be provocative when I wrote them — and I agree with everything both of them had to say. But, here’s what I was getting at when I made those comments, and I think my points remain valid.

Bruce notes that if we contract out for prison services under a state-run legal system, (1) the effect is likely to be a less-libertarian legal system, and (2) that because those private firms are paid with tax dollars, the force of government ultimately stands behind those private contractors. In anarchy, goods and services are supplied only in response to the demands of private individuals. I completely agree with everything Bruce said.

So, what is the relevance of anarchy? Pete and Bruce hold it up as an ideal end point, and at that point all prison services would be provided by private firms, but if the government runs the legal system we may be better off with prison services provided by government rather than private firms. So in this example what things would be like at the ultimate destination of anarchy is not the relevant factor determining whether we want prison services provided by private firms; it’s whether the legal system is private or run by government. Whether Bruce wants to call himself an anarchist is pretty much irrelevant to his opinion on this particular policy matter, and if this example generalizes, when looking at ways to limit the scope of government, we should be looking at the marginal effects (will this change increase or decrease liberty) regardless of what things might look like in anarchy.

I knew when I wrote it that Pete wouldn’t like my associating his views on anarchy with Reagan Republicanism, so, sorry for that cheap shot Pete! But, I was responding to your comment that your recommended path to anarchy “would have involved shrinking government…” and this is what sounds like Reagan Republicanism. But, I realize you were talking about a missed opportunity more than a century ago. You clarified in your latest

post that you don’t have in mind, and weren’t trying to suggest, any politically feasible path to anarchy for the present United States, even though you would like to see it.

What I was looking for was any relevance of this discussion on anarchy to the prospects for a libertarian anarchy in the United States today, and in all this discussion, I don’t see it. But perhaps I shouldn’t be expecting it either, because that wasn’t what Pete’s opening essay was discussing. I do see the relevance directly to the present state of affairs in Somalia, and by extension, to our government’s attempts to support governments in other poorer areas with histories of bad government. And Pete, I think the points you made about “self-governance working better than you think” are good ones, and valuable lessons for economists in general.

I agreed to join this conversation before I saw your opening essay, Pete, and as I said at the start of my first comment, I agreed with everything you said. So, I could have just said that, and all my participation would have been over in a sentence! Instead, I pushed a line of questioning that essentially was asking, what’s the relevance of this research on anarchy for prosperous societies like the United States? From a policy perspective, I still don’t see that it has much relevance but, as I’ve said previously, I do think it is valuable because it knocks the legs out from under the market failure argument that we need government to perform those functions the market can’t do. Going back to your title, self-governance does work better than you think, and that idea is not well-recognized by most people inside or outside of academia. So, despite my carping on some minor points, I am delighted to see you pushing the idea.

Also from this issue

Lead Essay

  • Anarchy Unbound, or: Why Self-Governance Works Better than You Think by Peter T. Leeson

    Everybody seems to know we need government … But pirates didn’t! How did they manage without the state? In this issue’s thought-provoking lead essay, Peter T. Leeson, the BB&T Professor for the Study of Capitalism at George Mason University, explores what pirate “constitutions,” credit institutions among 19th century African bandit traders, and the well-being of Somalians after the collapse of the Somalian state have to tell us about the possibility of practical anarchy. It works better than you think, Leeson concludes. “As long as there are unrealized gains to realize, people will find ways to realize them” — state or no state.

Response Essays

  • Anarchy Bound: Why Self-Government Is Less Widespread than It Should Be by Bruce L. Benson

    Bruce L. Benson, author of The Enterprise of Law: Justice Without the State, argues Peter Leeson’s defense of anarchy is too moderate. Governments in developed nations, Benson maintains, are not better than ordered anarchy. Drawing on Franz Oppenheimer’s classic account of the state as a protection racket, Benson argues that the state only seems necessary because it offers “solutions” to problems the state itself creates. Benson claims that even well-constrained states are essentially parasitic, leading him to conclude that “even when a relatively ‘good’ government exists, there still is way too much government and not nearly enough anarchy.”

  • The Limits of Self-Enforcing Agreements by Dani Rodrik

    Harvard economist Dani Rodrik is willing to accept a number of steps in Peter Leeson’s argument for anarchy, “but [Leeson’s] bottom line … represents a huge leap of faith.” Citing the work of several important thinkers, Rodrik argues that “the problem with self-enforcing agreements is that they do not scale up.” Both theory and data show that complex, well-functioning social and economic systems require the enforcement of rules by government. “Those societies in which markets work best are the ones where the reach of the state is longer, not shorter.”

  • Anarchy From a Policy Perspective by Randall G. Holcombe

    Florida State University economist Randall Holcombe argues that even if Leeson is right about anarchy, it doesn’t much matter. “Regardless of its merits,” Holcombe writes, “anarchy has no prospect as an actual policy option.” The bottom line is that government is popular in developed nations. Furthermore, anarchy may not be a “stable equilibrium,” in which case it might “coalesce into governments … potentially more oppressive and more destructive than those we see in prosperous areas today.” According to Holcombe, if we’re going to get a government anyway, the best approach to policy is to “make it smaller, less intrusive, and more libertarian,” not to make it go away.

The Conversation