Friday, June 23, 2006
American Anarcho-capitalist Sociopathy
This lengthy post addresses what I consider to be a flaw in the thinking of some libertarians, and particularly some anarcho-capitalists. I call it American Anarcho-capitalist Sociopathy (AAS), because I think it is concentrated among certain anarcho-capitalists whose roots are distinctly American, and because I think it leads them to a kind of sociopathic position, i.e. one that makes furthering of a more libertarian society impossible, and even in some cases encourages tyranny. This is not a critique of anarcho-capitalism or libertarianism (I consider myself an advocate of both). The ideas I express here were developed over a number of years, and stem in large part from debating with fellow libertarians, anarcho-capitalists and minarchists alike. The position I critique here may not exactly correspond to the thought of any particular person, but to an “ideal type” (or perhaps “unideal type”). But it isn’t an attack on a straw man – I know very well from experience that thinking I critique here exists. And this thinking should be discarded – all of us libertarians should take pains to avoid it, because it weakens our thinking and does the cause of liberty no good.
American Anarcho Sociopathy characterizes the thinking of some natural rights anarcho-capitalists, particularly within the Rothbard-Rockwell camp, although not necessarily limited to this group, nor necessarily characterizing the thinking of all who consider themselves to be within this group. The only name I wish to name is Rothbard himself, who explicitly endorsed this kind of thinking (there’s a single citation below, which I think is sufficient, but I find AAS thinking to be all too common in his writing).
Here is a quick explanation of AAS. Suppose we define the Ideal System (political-economic system), and let A be a complete description of this system. (If more than one ideal system is imaginable, then A is a description of every detail except those over which they may differ.) For the anarcho-capitalist, system A is of course anarcho-capitalism.
Assume that systems may differ from A (this is obvious), and more importantly may be characterized by the degree to which they differ from the ideal system. The system A’ differs from A by less than does the system A’’, which in turn differs from A by less than does the system A’’’, etc. That is A’, A’’, A’’’… are increasingly different from A.
Suppose we assert that any system we observe that deviates from the ideal A is suboptimal. We immediately run the risk of committing the Nirvana fallacy (Coase, Demsetz). That is we’ve ignored the costs, and perhaps even feasibility, of moving to A. It might not be possible (feasible) to establish the ideal. Or perhaps we could, but the costs of doing so outweigh the gains, making it a bad deal. If it is possible to achieve A, and if the gains outweigh the costs, then A’ can legitimately said to be suboptimal. Let’s assume that moving to the ideal system is not inherently impossible. We will not assume that the move is costless, since transaction costs are fundamental to all human action.
This assumes that the system is a means to an end, and can be reasonably judged according to benefits and costs. (This requires caution in interpretation. As Mises and Hayek have argued, human action always faces uncertainty, the possibility of unforeseen contingencies is ever present. But certainly we can distinguish, incompletely but not unreasonably, better vs. worse arrangements.)
Now in the natural rights framework, individual rights are inherent and unalienable absolutes pertaining to each individual. Consistently held, this viewpoint tolerates no violation of individual rights whatsoever (the non-aggression principle). Individual rights are seen as inherently good things in themselves, not simply as convenient means to other greater ends. Note that either an individual’s rights are respected, or they are not. In particular, a system (e.g. a state or government) either recognizes and respects the entirety of the individual’s rights, or else it does not, and what rights the individual is able to exercise depend on the arbitrary will of the state. (Or at least on something besides what those rights are.) By this criterion, either the individual’s rights are respected, or they are not. I’ll call this the (0,1) criterion, since by it, whether or not an individual’s rights are respected is a binary variable.
Now suppose also that the ideal system A is designed so as to be entirely consistent with the non-aggression principle. System A is then taken to be an ethical ideal, worthy for its own sake, and not simply ideal by some other criterion (e.g. utilitarianism, Pareto criterion, generation of market processes and wealth, etc.)
In this case, systems A’, A’’, etc. might or might not be suboptimal (feasibility and cost issues), but certainly are morally objectionable, since they fall short of the ethical ideal. Note that the distinction between optimal and ethically ideal is real. Optimality – even in a world of costless transacting – presumes a distribution of rights. Ideal, as used here, includes details of the rights distribution.
Now, here’s the question. Since no existing system is currently ideal, how are attempts to change the system to be evaluated?
AAS earns the “sociopathy” label by condemning all attempts at reform. Suppose a society begins with system A’’, and reformers desire to move the society to system A. Since transacting isn’t costless, instantaneous change is not possible. So the reform sequence is as follows:
1. Reformers take positions within the system as it exists, i.e. within A’’.
2. They begin transforming the system, moving to A’.
Now in terms of institutional details, this is movement towards A and an improvement. System A is preferred to system A’, which is in turn preferred to system A’’. But by the (0,1) criterion, A is preferred to either A’ or A’’, but A’ and A’’ are equivalent, since both systems include institutions that violate individual rights.
Based on the (0,1) criterion, the AAS position asserts that moving from A’’ to A’ isn’t a real improvement, and condemns the reformers as being at least as bad as the old regime. In practice, they may be labeled as worse, since they changed things, but not to A. Furthermore, AAS asserts, by making marginal changes but not fundamental ones, the reformers leave the violation of rights unassailed but perhaps reduce the pain arising from such, and so actually may be helping to entrench the fundamental problem.
The implication (from the armchair critic) is that reformers could have attained A, but they didn’t. But this argument ignores costs. And if costs of change aren’t recognized as a barrier to reform, then what remains, other than ethical failure? (In fact, there may be another – that of “sheer ingnorance,” the uncertainty that Mises, Hayek, Kirzner, and this blog find ubiquitous, but the AAS thinking seems to ignore this possibility as well.)
Furthermore, most real-world reformers are not anarcho-capitalists. Maybe none are. Thus most reformers do not set A as the ultimate goal, but some A’. These reformers further incur the condemnation of AAS since they admittedly advocate some violations of the non-aggression principle. They are automatically condemned by the (0,1) criterion.
Hence “sociopathy.” We begin with imperfect institutions that do not adequately respect individual rights. And by use of the (0,1) criterion, any attempt to improve the situation by actually implementing new institutions and policies can be “proven” flawed and simply another variant of statist aggression.
It is quite clear that the part of flaw in this line of thought is the (0,1) criterion. The non-aggression ideal is sound. But it must be possible to rank rights violations, and hence imperfect systems (and politicians) by the extent to which the respect individual rights. Notice that critiquing the (0,1) criterion doesn’t mean that we can’t condemn all violations of individual rights – just that we recognize that some are worse than others – we can be sensible about the matter.
Any ranking will have an element of subjectivity to it. Fundamentally, as ethical concepts, individual rights appear to be subjective (which is decidedly not the same as arbitrary) anyway, so this should not be an objection. But members of the AAS camp are likely to object that ranking these violations is akin to making scientific interpersonal comparisons of utility, which are arbitrary. After all, either one’s rights are respected, or they aren’t, right? And if even one right isn’t respected by the state, isn’t it the case that, at least in principle, one’s freedom is just whatever the state chooses to permit at any given moment? Can there really be degrees of respect for unalienable rights?
Yes, of course. There’s a difference between someone stealing a penny from you when you aren’t looking, and someone shooting you in the head. It isn’t sensible to regard, say, Thomas Jefferson’s presidential administration and the Pol Pot regime as fundamentally similar political systems. Or for a more mundane example, currently in the U.S., it is illegal to walk down the street drinking a beer in most cities. In Russia, in most cities this is perfectly legal behavior. But any sensible person would be slow to say Russia is a freer country than the U.S. on this basis. To the contrary, despite this restraint on the rights of the individual, the sensible person would say that the U.S. is freer than Russia. This means that we can weigh tradeoffs in rights and rights violations. Perhaps it requires judgement or Verstehen, but it isn’t insensible. Someone might in fact argue that Russia is actually freer than the U.S,, but that’s beside the point. It’s not unreasonable to argue about how these matters should be evaluated. In some specific dimensions the U.S. is obviously freer, and in some dimensions Russia is, but we can weigh those differences and say which dominate. Hence the differences between systems is one of degree, and we can characterize this, contradicting the (0,1) criterion.
More dramatically, no sensible person would say that South Korea is a libertarian country, since it is far from such. And no sane person would say that South Koreans are not much freer than North Koreans. Again, by the (0,1) criterion, the two Koreas have identically objectionable systems…which illustrates the absurdity of the criterion.
Now consider:
1. No one knows how to achieve the ideal system A. There’s no good theory of institutional change. We don’t know very clearly how to go from today’s A’’ to ideal state A. (There’s widespread disagreement as to what A really is, as well, but that’s a different issue.)
2. We can recognize that if we begin at A’’, a movement to A’ is a move in the right direction. And in fact we can reasonably and ethically support imperfect reform that takes us from A’’ to A’.
3. If we support A and the reformers support A’ (and are battling the status quo A’’), we can reasonably and ethically support these reformers. It doesn’t matter whether the reformers are ethically pure supporters of A, or simply supporters of A’.
4. Sociopathy is condemning any> imperfect reform attempt, where imperfect is defined as failing to take us instantly to A. Since perfect reform is an impossibility, this simply ensures no effort to improve things will go uncondemned. That’s sociopathic thinking!
There are other sorts of applications of this analysis, other than to overall systems. Consider monetary reform, for example. Suppose A is some ideal monetary system, perhaps a gold standard, or free banking, or whatever you like. Now suppose that A’’ is central bank system in a transition country engaging in hyperinflation at the behest of political authorities and their oligarchic supporters. Suppose further that someone, say a team of “statist thugs” from the IMF, venture to the country and argue – and in fact persuade – the people in the country to move to A’, a central bank with tight monetary policy, and independent apolitical management.
This example isn’t hypothetical, but actually describes events in a number of countries in the former Soviet Union. Perhaps IMF, World Bank, USAID, and other advisors could have pushed for even deeper reform (although perhaps not), but the establishment of relatively sound monetary policies in Russia and Ukraine did an immense amount of good for people living there – including for their liberty, since, as Rothbard has correctly argued, forcing a hyperinflated currency upon people is a particularly egregious form of theft. But by the AAS (0,1) criterion, this action is particularly evil, because it establishes an imperfect system, once which might even be stable.
(Digression: It is important here to separate this condemnation from another one – that the IMF, USAID, etc. are funded by taxes that are themselves violations of rights. This is a quite different objection, and would apply even if IMF advocated the ideal monetary system A, however defined.)
If ignoring costs and other barriers to change is one problem in AAS thinking, the second (intimately related) problem is that it employs the Nirvana Fallacy almost as a tool of policy analysis. Any non-anarcho-capitalist system is, by definition, inferior to the anarcho-capitalist ideal. Similarly (and even worse) any policy recommendation for such a system is inferior to anarcho-capitalism, with one exception. That any system other than anarcho-capitalism is in some sense ethically inferior seems obvious, since any element of statism necessarily violates the rights of some person (here’s the citation: see Rothbard in Kirzner’s 1982 “Method, Process, and Austrian Economics,” pp. 185-188). And I think any anarcho-capitalist, not just practitioners of AAS, can agree with this – even some minarchists concur (although they believe that the perfect anarcho-capitalist system is either unattainable or wildly unstable, and thus are willing to accept a minimal amount of violation of rights). But also, practitioners of AAS note that any attempt to modify or reform a statist system, short of utterly abolishing it, “accepts” in some sense statism and violation of rights; if the proposed change does not attain the anarcho-capitalist ideal, it must be a statist measure, at best a half-measure, but more likely something that simply helps entrench the statist system in some way.
This is a crucial point, so I’ll dwell on it. Reform of a statist system, rather than abolition of it, always leaves something that falls short of the anarcho-capitalist ideal. It therefore can easily be criticized as tolerant of institutionalized violation of rights, and not fundamentally different from any other statist system – including those of Hitler, Stalin, and Mao. The only change that is not objectionable, in this view, is the complete abolition of the statist system, with replacement by an anarcho-capitalist system.
Unfortunately, this latter policy is impossible. There is no way to go from an entrenched statist system to an anarcho-capitalist one “overnight.” “Abolish the state” is not a practical program. There are several problems here. First, instituting anarcho-capitalism (or any other new system) requires more than simply abolishing the old system. Removing old institutions is one thing; building new institutions is another (“institutions,” here, is used in the economist’s sense: basic rules governing a society, including the enforcement of them). “Abolish the state” doesn’t focus on replacing it with new and better institutions. The practitioners of AAS fall into the same trap that Marxists fell into when advocating the abolition of capitalism. Marx and his followers devoted enormous effort to discussing how to abolish capitalism, but neglected to say how an economy could be run with private property and markets. Mises and Hayek pointed this out, and Marxists and other central planners never succeeded in overcoming the objection. As economist Peter Boettke of George Mason University has argued, for the Marxists the question hadn’t arisen, essentially because they assumed that central planning was the absence of private ownership and decentralized decision-making in markets. By fixating on their bogeyman capitalism, they neglected to consider the problems they’d have in building their own system, which somehow would just arise out of the ashes of capitalism.
I think anarcho-capitalists are not in exactly the same position as socialists. Anarcho-capitalists have given attention to how an anarcho-capitalist system might function, and have a large body of work – the economic theory of private property and markets – on which they draw. However, I think practitioners of AAS do fall into this trap. Since the state is equivalent to rights violations, abolition of the state is equivalent to establishing anarcho-capitalism. After all, if some new rights-violating regime emerges in the wake of an abolished state, the AAS practitioner can simply say “well, the state wasn’t abolished, just changed.” Hence by fixating on their bogeyman statism, they neglect to consider the problems they’d have in building their own system, which somehow arises out of the ashes or absence of statism.
I think that anarcho-capitalists have given a fair amount of thought to how an anarcho-capitalist system might function. But they seem to have given inadequate attention to the issue of how a society might become anarcho-capitalist, which is a different matter. Establishment of an anarcho-capitalist system would certainly require “supporting” institutions of private property and contract enforcement, and widespread belief in markets and contracting – including over dimensions where activities are now handled by the state. Moving to an anarcho-capitalist system would require much more than simply abolishing current arrangements. And the necessary institutions would not simply “pop up” starting from scratch. As Mises, Hayek, North, and many others have shown, development of institutions, of rules, is a step-by-step evolutionary process, that requires testing, learning, etc. Coase has pointed out the ubiquitousness of cases in which property rights are not fully defined, leading to difficulties in applying direct contracting as a solution to conflicts. The development of any anarcho-capitalist system will necessarily be an evolutionary process, one in which the system evolves out of a set of existing “statist” institutions.
Unfortunately, this is exactly the sort of thing that AAS condemns. Any steps other than outright abolition of the state can be argued to “accept” statism, and therefore are to be opposed by the anarcho-capitalist. This commits the Nirvana fallacy, since the implied alternative – instant attainment of anarcho-capitalism – is clearly impossible. This turns anarcho-capitalism into a utopian fantasy, suitable for critiquing the sinfulness of the fallen statist world, but of no practical value. Of course, such a rarified position – that of condemning all existing political arrangements and events as equally bad – is difficult to hold consistently. Hence most practitioners of AAS rank actual existing political arrangements and events on an ad hoc basis, apparently according to “rules” that stem largely from emotion.
For example, some observe, say, the crimes of the current United States government and, filled with disgust, fixate on this exclusively – and begin endorsing anyone who opposes this government. Hence the apologies for the brutal dictator of Belarus, Alexander Lukashenka, or for homicidal Marxists in Viet Nam and Cambodia, or for bloodthirsty jihadists in Iraq that have been documented on Tom Palmer’s blog (see the “Fever Swamp” category in the archives). Or similarly, focusing exclusively on the crimes of Abraham Lincoln, these libertarians find themselves wholeheartedly endorsing the final bastion of formal slavery in the developed world, the thoroughly statist Confederate States of America.
This is sociopathy. Consistently practicing the Nirvana fallacy and thus condemning all attempts to improve the world is sociopathic. Similarly, selectively practicing the Nirvana fallacy so as to accommodate tyrants who happen to be enemies of certain especially hated states is also sociopathic. These are dead-end ways of thinking that ignore the economics of institutions and institutional change, do not offer any practical method for improving the world, and alienate people who would be attracted to an anarcho-capitalism (or more generally libertarianism) which actually offered hope of establishing free and stable political arrangements.
All through this post I have referred to “sociopathy,” not sociopaths. In closing, I want to be clear – I’m condemning a fallacious way of thinking, and not the people who engage in it. I have certainly committed the Nirvana fallacy myself, as have most libertarians. And I don’t doubt that many, probably most, practitioners of AAS are genuine libertarians. My point is not to condemn them, but to suggest they seriously reconsider and change certain aspects of their thinking. To do so will strengthen their positions and further the cause of liberty.
American Anarcho Sociopathy characterizes the thinking of some natural rights anarcho-capitalists, particularly within the Rothbard-Rockwell camp, although not necessarily limited to this group, nor necessarily characterizing the thinking of all who consider themselves to be within this group. The only name I wish to name is Rothbard himself, who explicitly endorsed this kind of thinking (there’s a single citation below, which I think is sufficient, but I find AAS thinking to be all too common in his writing).
Here is a quick explanation of AAS. Suppose we define the Ideal System (political-economic system), and let A be a complete description of this system. (If more than one ideal system is imaginable, then A is a description of every detail except those over which they may differ.) For the anarcho-capitalist, system A is of course anarcho-capitalism.
Assume that systems may differ from A (this is obvious), and more importantly may be characterized by the degree to which they differ from the ideal system. The system A’ differs from A by less than does the system A’’, which in turn differs from A by less than does the system A’’’, etc. That is A’, A’’, A’’’… are increasingly different from A.
Suppose we assert that any system we observe that deviates from the ideal A is suboptimal. We immediately run the risk of committing the Nirvana fallacy (Coase, Demsetz). That is we’ve ignored the costs, and perhaps even feasibility, of moving to A. It might not be possible (feasible) to establish the ideal. Or perhaps we could, but the costs of doing so outweigh the gains, making it a bad deal. If it is possible to achieve A, and if the gains outweigh the costs, then A’ can legitimately said to be suboptimal. Let’s assume that moving to the ideal system is not inherently impossible. We will not assume that the move is costless, since transaction costs are fundamental to all human action.
This assumes that the system is a means to an end, and can be reasonably judged according to benefits and costs. (This requires caution in interpretation. As Mises and Hayek have argued, human action always faces uncertainty, the possibility of unforeseen contingencies is ever present. But certainly we can distinguish, incompletely but not unreasonably, better vs. worse arrangements.)
Now in the natural rights framework, individual rights are inherent and unalienable absolutes pertaining to each individual. Consistently held, this viewpoint tolerates no violation of individual rights whatsoever (the non-aggression principle). Individual rights are seen as inherently good things in themselves, not simply as convenient means to other greater ends. Note that either an individual’s rights are respected, or they are not. In particular, a system (e.g. a state or government) either recognizes and respects the entirety of the individual’s rights, or else it does not, and what rights the individual is able to exercise depend on the arbitrary will of the state. (Or at least on something besides what those rights are.) By this criterion, either the individual’s rights are respected, or they are not. I’ll call this the (0,1) criterion, since by it, whether or not an individual’s rights are respected is a binary variable.
Now suppose also that the ideal system A is designed so as to be entirely consistent with the non-aggression principle. System A is then taken to be an ethical ideal, worthy for its own sake, and not simply ideal by some other criterion (e.g. utilitarianism, Pareto criterion, generation of market processes and wealth, etc.)
In this case, systems A’, A’’, etc. might or might not be suboptimal (feasibility and cost issues), but certainly are morally objectionable, since they fall short of the ethical ideal. Note that the distinction between optimal and ethically ideal is real. Optimality – even in a world of costless transacting – presumes a distribution of rights. Ideal, as used here, includes details of the rights distribution.
Now, here’s the question. Since no existing system is currently ideal, how are attempts to change the system to be evaluated?
AAS earns the “sociopathy” label by condemning all attempts at reform. Suppose a society begins with system A’’, and reformers desire to move the society to system A. Since transacting isn’t costless, instantaneous change is not possible. So the reform sequence is as follows:
1. Reformers take positions within the system as it exists, i.e. within A’’.
2. They begin transforming the system, moving to A’.
Now in terms of institutional details, this is movement towards A and an improvement. System A is preferred to system A’, which is in turn preferred to system A’’. But by the (0,1) criterion, A is preferred to either A’ or A’’, but A’ and A’’ are equivalent, since both systems include institutions that violate individual rights.
Based on the (0,1) criterion, the AAS position asserts that moving from A’’ to A’ isn’t a real improvement, and condemns the reformers as being at least as bad as the old regime. In practice, they may be labeled as worse, since they changed things, but not to A. Furthermore, AAS asserts, by making marginal changes but not fundamental ones, the reformers leave the violation of rights unassailed but perhaps reduce the pain arising from such, and so actually may be helping to entrench the fundamental problem.
The implication (from the armchair critic) is that reformers could have attained A, but they didn’t. But this argument ignores costs. And if costs of change aren’t recognized as a barrier to reform, then what remains, other than ethical failure? (In fact, there may be another – that of “sheer ingnorance,” the uncertainty that Mises, Hayek, Kirzner, and this blog find ubiquitous, but the AAS thinking seems to ignore this possibility as well.)
Furthermore, most real-world reformers are not anarcho-capitalists. Maybe none are. Thus most reformers do not set A as the ultimate goal, but some A’. These reformers further incur the condemnation of AAS since they admittedly advocate some violations of the non-aggression principle. They are automatically condemned by the (0,1) criterion.
Hence “sociopathy.” We begin with imperfect institutions that do not adequately respect individual rights. And by use of the (0,1) criterion, any attempt to improve the situation by actually implementing new institutions and policies can be “proven” flawed and simply another variant of statist aggression.
It is quite clear that the part of flaw in this line of thought is the (0,1) criterion. The non-aggression ideal is sound. But it must be possible to rank rights violations, and hence imperfect systems (and politicians) by the extent to which the respect individual rights. Notice that critiquing the (0,1) criterion doesn’t mean that we can’t condemn all violations of individual rights – just that we recognize that some are worse than others – we can be sensible about the matter.
Any ranking will have an element of subjectivity to it. Fundamentally, as ethical concepts, individual rights appear to be subjective (which is decidedly not the same as arbitrary) anyway, so this should not be an objection. But members of the AAS camp are likely to object that ranking these violations is akin to making scientific interpersonal comparisons of utility, which are arbitrary. After all, either one’s rights are respected, or they aren’t, right? And if even one right isn’t respected by the state, isn’t it the case that, at least in principle, one’s freedom is just whatever the state chooses to permit at any given moment? Can there really be degrees of respect for unalienable rights?
Yes, of course. There’s a difference between someone stealing a penny from you when you aren’t looking, and someone shooting you in the head. It isn’t sensible to regard, say, Thomas Jefferson’s presidential administration and the Pol Pot regime as fundamentally similar political systems. Or for a more mundane example, currently in the U.S., it is illegal to walk down the street drinking a beer in most cities. In Russia, in most cities this is perfectly legal behavior. But any sensible person would be slow to say Russia is a freer country than the U.S. on this basis. To the contrary, despite this restraint on the rights of the individual, the sensible person would say that the U.S. is freer than Russia. This means that we can weigh tradeoffs in rights and rights violations. Perhaps it requires judgement or Verstehen, but it isn’t insensible. Someone might in fact argue that Russia is actually freer than the U.S,, but that’s beside the point. It’s not unreasonable to argue about how these matters should be evaluated. In some specific dimensions the U.S. is obviously freer, and in some dimensions Russia is, but we can weigh those differences and say which dominate. Hence the differences between systems is one of degree, and we can characterize this, contradicting the (0,1) criterion.
More dramatically, no sensible person would say that South Korea is a libertarian country, since it is far from such. And no sane person would say that South Koreans are not much freer than North Koreans. Again, by the (0,1) criterion, the two Koreas have identically objectionable systems…which illustrates the absurdity of the criterion.
Now consider:
1. No one knows how to achieve the ideal system A. There’s no good theory of institutional change. We don’t know very clearly how to go from today’s A’’ to ideal state A. (There’s widespread disagreement as to what A really is, as well, but that’s a different issue.)
2. We can recognize that if we begin at A’’, a movement to A’ is a move in the right direction. And in fact we can reasonably and ethically support imperfect reform that takes us from A’’ to A’.
3. If we support A and the reformers support A’ (and are battling the status quo A’’), we can reasonably and ethically support these reformers. It doesn’t matter whether the reformers are ethically pure supporters of A, or simply supporters of A’.
4. Sociopathy is condemning any> imperfect reform attempt, where imperfect is defined as failing to take us instantly to A. Since perfect reform is an impossibility, this simply ensures no effort to improve things will go uncondemned. That’s sociopathic thinking!
There are other sorts of applications of this analysis, other than to overall systems. Consider monetary reform, for example. Suppose A is some ideal monetary system, perhaps a gold standard, or free banking, or whatever you like. Now suppose that A’’ is central bank system in a transition country engaging in hyperinflation at the behest of political authorities and their oligarchic supporters. Suppose further that someone, say a team of “statist thugs” from the IMF, venture to the country and argue – and in fact persuade – the people in the country to move to A’, a central bank with tight monetary policy, and independent apolitical management.
This example isn’t hypothetical, but actually describes events in a number of countries in the former Soviet Union. Perhaps IMF, World Bank, USAID, and other advisors could have pushed for even deeper reform (although perhaps not), but the establishment of relatively sound monetary policies in Russia and Ukraine did an immense amount of good for people living there – including for their liberty, since, as Rothbard has correctly argued, forcing a hyperinflated currency upon people is a particularly egregious form of theft. But by the AAS (0,1) criterion, this action is particularly evil, because it establishes an imperfect system, once which might even be stable.
(Digression: It is important here to separate this condemnation from another one – that the IMF, USAID, etc. are funded by taxes that are themselves violations of rights. This is a quite different objection, and would apply even if IMF advocated the ideal monetary system A, however defined.)
If ignoring costs and other barriers to change is one problem in AAS thinking, the second (intimately related) problem is that it employs the Nirvana Fallacy almost as a tool of policy analysis. Any non-anarcho-capitalist system is, by definition, inferior to the anarcho-capitalist ideal. Similarly (and even worse) any policy recommendation for such a system is inferior to anarcho-capitalism, with one exception. That any system other than anarcho-capitalism is in some sense ethically inferior seems obvious, since any element of statism necessarily violates the rights of some person (here’s the citation: see Rothbard in Kirzner’s 1982 “Method, Process, and Austrian Economics,” pp. 185-188). And I think any anarcho-capitalist, not just practitioners of AAS, can agree with this – even some minarchists concur (although they believe that the perfect anarcho-capitalist system is either unattainable or wildly unstable, and thus are willing to accept a minimal amount of violation of rights). But also, practitioners of AAS note that any attempt to modify or reform a statist system, short of utterly abolishing it, “accepts” in some sense statism and violation of rights; if the proposed change does not attain the anarcho-capitalist ideal, it must be a statist measure, at best a half-measure, but more likely something that simply helps entrench the statist system in some way.
This is a crucial point, so I’ll dwell on it. Reform of a statist system, rather than abolition of it, always leaves something that falls short of the anarcho-capitalist ideal. It therefore can easily be criticized as tolerant of institutionalized violation of rights, and not fundamentally different from any other statist system – including those of Hitler, Stalin, and Mao. The only change that is not objectionable, in this view, is the complete abolition of the statist system, with replacement by an anarcho-capitalist system.
Unfortunately, this latter policy is impossible. There is no way to go from an entrenched statist system to an anarcho-capitalist one “overnight.” “Abolish the state” is not a practical program. There are several problems here. First, instituting anarcho-capitalism (or any other new system) requires more than simply abolishing the old system. Removing old institutions is one thing; building new institutions is another (“institutions,” here, is used in the economist’s sense: basic rules governing a society, including the enforcement of them). “Abolish the state” doesn’t focus on replacing it with new and better institutions. The practitioners of AAS fall into the same trap that Marxists fell into when advocating the abolition of capitalism. Marx and his followers devoted enormous effort to discussing how to abolish capitalism, but neglected to say how an economy could be run with private property and markets. Mises and Hayek pointed this out, and Marxists and other central planners never succeeded in overcoming the objection. As economist Peter Boettke of George Mason University has argued, for the Marxists the question hadn’t arisen, essentially because they assumed that central planning was the absence of private ownership and decentralized decision-making in markets. By fixating on their bogeyman capitalism, they neglected to consider the problems they’d have in building their own system, which somehow would just arise out of the ashes of capitalism.
I think anarcho-capitalists are not in exactly the same position as socialists. Anarcho-capitalists have given attention to how an anarcho-capitalist system might function, and have a large body of work – the economic theory of private property and markets – on which they draw. However, I think practitioners of AAS do fall into this trap. Since the state is equivalent to rights violations, abolition of the state is equivalent to establishing anarcho-capitalism. After all, if some new rights-violating regime emerges in the wake of an abolished state, the AAS practitioner can simply say “well, the state wasn’t abolished, just changed.” Hence by fixating on their bogeyman statism, they neglect to consider the problems they’d have in building their own system, which somehow arises out of the ashes or absence of statism.
I think that anarcho-capitalists have given a fair amount of thought to how an anarcho-capitalist system might function. But they seem to have given inadequate attention to the issue of how a society might become anarcho-capitalist, which is a different matter. Establishment of an anarcho-capitalist system would certainly require “supporting” institutions of private property and contract enforcement, and widespread belief in markets and contracting – including over dimensions where activities are now handled by the state. Moving to an anarcho-capitalist system would require much more than simply abolishing current arrangements. And the necessary institutions would not simply “pop up” starting from scratch. As Mises, Hayek, North, and many others have shown, development of institutions, of rules, is a step-by-step evolutionary process, that requires testing, learning, etc. Coase has pointed out the ubiquitousness of cases in which property rights are not fully defined, leading to difficulties in applying direct contracting as a solution to conflicts. The development of any anarcho-capitalist system will necessarily be an evolutionary process, one in which the system evolves out of a set of existing “statist” institutions.
Unfortunately, this is exactly the sort of thing that AAS condemns. Any steps other than outright abolition of the state can be argued to “accept” statism, and therefore are to be opposed by the anarcho-capitalist. This commits the Nirvana fallacy, since the implied alternative – instant attainment of anarcho-capitalism – is clearly impossible. This turns anarcho-capitalism into a utopian fantasy, suitable for critiquing the sinfulness of the fallen statist world, but of no practical value. Of course, such a rarified position – that of condemning all existing political arrangements and events as equally bad – is difficult to hold consistently. Hence most practitioners of AAS rank actual existing political arrangements and events on an ad hoc basis, apparently according to “rules” that stem largely from emotion.
For example, some observe, say, the crimes of the current United States government and, filled with disgust, fixate on this exclusively – and begin endorsing anyone who opposes this government. Hence the apologies for the brutal dictator of Belarus, Alexander Lukashenka, or for homicidal Marxists in Viet Nam and Cambodia, or for bloodthirsty jihadists in Iraq that have been documented on Tom Palmer’s blog (see the “Fever Swamp” category in the archives). Or similarly, focusing exclusively on the crimes of Abraham Lincoln, these libertarians find themselves wholeheartedly endorsing the final bastion of formal slavery in the developed world, the thoroughly statist Confederate States of America.
This is sociopathy. Consistently practicing the Nirvana fallacy and thus condemning all attempts to improve the world is sociopathic. Similarly, selectively practicing the Nirvana fallacy so as to accommodate tyrants who happen to be enemies of certain especially hated states is also sociopathic. These are dead-end ways of thinking that ignore the economics of institutions and institutional change, do not offer any practical method for improving the world, and alienate people who would be attracted to an anarcho-capitalism (or more generally libertarianism) which actually offered hope of establishing free and stable political arrangements.
All through this post I have referred to “sociopathy,” not sociopaths. In closing, I want to be clear – I’m condemning a fallacious way of thinking, and not the people who engage in it. I have certainly committed the Nirvana fallacy myself, as have most libertarians. And I don’t doubt that many, probably most, practitioners of AAS are genuine libertarians. My point is not to condemn them, but to suggest they seriously reconsider and change certain aspects of their thinking. To do so will strengthen their positions and further the cause of liberty.
