TheDrakeMan
01-09-2012, 07:36 PM
http://www.libertarianmonarchy.com/whylibertarianmonarchy.htm
I could go into detail about other political systems but to summarize I will explain why a Libertarian Monarchy will bring prosperity to any nation and why Democracy and Anarcho-Capitalism, as the main two alternatives, can never work.
First, it is important to understand where wealth comes from in order to comprehend which system will foster wealth creation.
When looking at political systems it is important to analyze the behavior of humans based on the incentives given by the system. Furthermore, it is important to examine the degree of political power of each agent and how it is exerted.
In a democracy everyone is given the power to coerce each other through voting. On a smaller scale, it would be like 2 wolves and a sheep voting on what to have for lunch. The opinion of the minority does not matter. To maximize their utility, the majority will always vote to steal from the minority. The rich (minority) will constantly be expropriated by the poor (majority). In a democracy it is their legal right to do so. Clearly this system will lead to massive amounts of wealth redistribution which leads to poverty. The U.S. has clearly eroded into a socialist state because of the democratic system employed. Hans-Hermann Hoppe correctly and very thoroughly explains how a democracy is a detrimental political system. A summary of his lecture.(http://mises.org/daily/4068) (http://www.youtube.com/watch?v=--yoeXGSKiI)
Hoppe is against democracy but believes Anarcho-Capitalism, a system of competing private and purely defensive governments can work. When referring to democracy, Hoppe accurately explains how competition between politicians is bad. Competition forces the elected officials to be the best liars, demagogues, and manipulators. Hoppe does not develop and expand on this concept further, which is why I believe he lacks a proper understanding of political systems, particularly anarcho-capitalism.
Governments produce “bads”, unlike companies which produce “goods”. What distinguishes a government from any other organization is the fact that it is engaged in the production of coercion. In anarcho-capitalism, competition between governments is encouraged. Competition helps maximize the amount of production, as well as increase innovation and efficiency. By increasing competition, among governments, anarcho-capitalism leads to an increase in the production of coercion, as well as innovation and efficiency within the industry of coercion. If governments competed, then only the most ruthless, evil, and efficient governments could survive. There would be efficiency in the production of “bads” such as taxation, slavery, brainwashing, or controlling of the public, which is clearly not advantageous. There is a lot of competition in democracy which is why very demagogic and evil leaders are elected. Unfortunately, the same is true of anarcho-capitalism. The government that is most profitable is the one that can manipulate the population and steal the most property. Trying to apply a market-based solution to political systems is flawed because governments do not produce goods. Since governments produce “bads” there is an inverse result. In a free market when companies try to monopolize they end up losing money by drawing in competition. If governments monopolize they can gain more power and expropriate more. When companies monopolize the industry they cut the production of goods to raise prices and maximize their profits. If governments monopolize the industry they must raise the production of “bads” to maximize their profits. The more they steal the wealthier they become which allows them to steal even more. It is optimal to have perfect competition, as opposed to monopoly, when it comes to the production of goods. In contrast, it is optimal to have a monopoly, as opposed to perfect competition, in the production of “bads” so that the production can be restricted, rather than expanded. Imagine there are 5 large protection agencies in one country. Why would the protection agencies compete when they can just merge together? It would be a lot easier to preserve capital and maximize profits if this was done. Let’s assume that one of the protection agencies is owned by a staunch believer in anarcho-capitalism and therefore refuses to merge with the other companies. Well now it’s four against one. The owner is taking huge amounts of risk and preserving a competitor. It makes no economic sense. Once the largest companies merge together they can crush any new competitors before they have time to grow. Private governments will redistribute wealth from the rich to the poor, in order to lower the premiums and get support from the poor. In anarcho-capitalism, what if there was a communist movement? What if all the poor(majority) decide to start stealing from the rich(minority), would it be profitable for a company to side with the rich? The companies would have to compete for clients. Therefore companies that offered social security, or socialized healthcare will always win because, despite the destructive nature of these programs, the majority benefit and the majority can impose them. It will cost the minorities much higher premiums for protection compared to the majority. It is better for the companies to expropriate the rich than protect them. Imagine 10 people, all 9 of equal wealth, with 1 that is twice as rich. Obviously it is in the interest of the group to expropriate the minority. The premium for protection would be too high for the rich person to afford. It is not an accident that Anarcho-capitalism doesn’t exist. If anarcho-capitalism was a viable political system then it would already be thriving in every country in the world. There is plenty of competition between countries, yet anarcho-capitalism has not emerged. I would argue that tyrannical dictatorships are the result of competing governments and Anarcho-capitalism. The dictators quickly and ruthlessly wipe out their competitors gaining more power. They steal from the rich to give to the poor attaining public support. Surely citizens of these impoverished countries would love to have a competing government challenge the existing one but it is the efficiency of the ruling government that allows it to stay in power. Remember, “efficiency” in this case refers to the ability to control the public and expropriate wealth. The more ruthless a dictator is the more power he has. He competes with other dictators and the most evil, manipulative and “efficient” one wins out.
So if these political systems don’t work, is there any hope? The answer is yes. The greatest political system is an Austro-Libertarian monarchy. Only an austro-libertarian monarchy, equipped with a powerful army, can stand up for private property rights and liberty. This is the only system that will work. It is not as great as anarchy(which unfortunately doesn’t exist) but it restricts competition in political power(“bads”) production and therefore gives political freedom to all its citizens. In this society everything would be privatized including the police(security), the courts and the prisons. The only exception would be that the production of coercion would be monopolized and restricted. The Libertarian King's descendent will not be his children but rather someone will be chosen by the king who clearly has strong beliefs in private property. This system clearly worked when the founding fathers were alive. They were libertarians and when they were around to administer things the country was run outstandingly well. Unfortunately, the democratic system quickly eroded private property rights and showed it's weakness as the people elected leaders who would redistribute wealth. If instead there was a libertarian monarchy a process of successors starting with George Washington as the Monarch, then perhaps Jefferson as the king. He may have appointed Andrew Jackson, who may have appointed Carl Menger, who would have appointed Bohm-Bawerk, who would have appointed Mises, who would have appointed Rothbard, etc. A long line of libertarian monarchs would have ruled. They would have protected private property at all costs and produced the wealthiest country in world history. The country would have been so prosperous it would prove to every other country that they should use the U.S. as a model. Unfortunately today many countries choose socialism as an alternative to U.S. "capitalism". Current U.S. “Capitalism” is more akin to economic fascism or corporatism then to a laissez-faire free market. The socialists constantly criticize the U.S. healthcare system and justify their nationalized healthcare as a good alternative. If the founding fathers had created a Libertarian Monarchy the U.S. would be exactly as free and prosperous as they imagined it. There would be a chain of Austro-Libertarian Monarchs. A dynasty that represented liberty, private property and personal freedom, that could last for hundreds of years.
I could go into detail about other political systems but to summarize I will explain why a Libertarian Monarchy will bring prosperity to any nation and why Democracy and Anarcho-Capitalism, as the main two alternatives, can never work.
First, it is important to understand where wealth comes from in order to comprehend which system will foster wealth creation.
When looking at political systems it is important to analyze the behavior of humans based on the incentives given by the system. Furthermore, it is important to examine the degree of political power of each agent and how it is exerted.
In a democracy everyone is given the power to coerce each other through voting. On a smaller scale, it would be like 2 wolves and a sheep voting on what to have for lunch. The opinion of the minority does not matter. To maximize their utility, the majority will always vote to steal from the minority. The rich (minority) will constantly be expropriated by the poor (majority). In a democracy it is their legal right to do so. Clearly this system will lead to massive amounts of wealth redistribution which leads to poverty. The U.S. has clearly eroded into a socialist state because of the democratic system employed. Hans-Hermann Hoppe correctly and very thoroughly explains how a democracy is a detrimental political system. A summary of his lecture.(http://mises.org/daily/4068) (http://www.youtube.com/watch?v=--yoeXGSKiI)
Hoppe is against democracy but believes Anarcho-Capitalism, a system of competing private and purely defensive governments can work. When referring to democracy, Hoppe accurately explains how competition between politicians is bad. Competition forces the elected officials to be the best liars, demagogues, and manipulators. Hoppe does not develop and expand on this concept further, which is why I believe he lacks a proper understanding of political systems, particularly anarcho-capitalism.
Governments produce “bads”, unlike companies which produce “goods”. What distinguishes a government from any other organization is the fact that it is engaged in the production of coercion. In anarcho-capitalism, competition between governments is encouraged. Competition helps maximize the amount of production, as well as increase innovation and efficiency. By increasing competition, among governments, anarcho-capitalism leads to an increase in the production of coercion, as well as innovation and efficiency within the industry of coercion. If governments competed, then only the most ruthless, evil, and efficient governments could survive. There would be efficiency in the production of “bads” such as taxation, slavery, brainwashing, or controlling of the public, which is clearly not advantageous. There is a lot of competition in democracy which is why very demagogic and evil leaders are elected. Unfortunately, the same is true of anarcho-capitalism. The government that is most profitable is the one that can manipulate the population and steal the most property. Trying to apply a market-based solution to political systems is flawed because governments do not produce goods. Since governments produce “bads” there is an inverse result. In a free market when companies try to monopolize they end up losing money by drawing in competition. If governments monopolize they can gain more power and expropriate more. When companies monopolize the industry they cut the production of goods to raise prices and maximize their profits. If governments monopolize the industry they must raise the production of “bads” to maximize their profits. The more they steal the wealthier they become which allows them to steal even more. It is optimal to have perfect competition, as opposed to monopoly, when it comes to the production of goods. In contrast, it is optimal to have a monopoly, as opposed to perfect competition, in the production of “bads” so that the production can be restricted, rather than expanded. Imagine there are 5 large protection agencies in one country. Why would the protection agencies compete when they can just merge together? It would be a lot easier to preserve capital and maximize profits if this was done. Let’s assume that one of the protection agencies is owned by a staunch believer in anarcho-capitalism and therefore refuses to merge with the other companies. Well now it’s four against one. The owner is taking huge amounts of risk and preserving a competitor. It makes no economic sense. Once the largest companies merge together they can crush any new competitors before they have time to grow. Private governments will redistribute wealth from the rich to the poor, in order to lower the premiums and get support from the poor. In anarcho-capitalism, what if there was a communist movement? What if all the poor(majority) decide to start stealing from the rich(minority), would it be profitable for a company to side with the rich? The companies would have to compete for clients. Therefore companies that offered social security, or socialized healthcare will always win because, despite the destructive nature of these programs, the majority benefit and the majority can impose them. It will cost the minorities much higher premiums for protection compared to the majority. It is better for the companies to expropriate the rich than protect them. Imagine 10 people, all 9 of equal wealth, with 1 that is twice as rich. Obviously it is in the interest of the group to expropriate the minority. The premium for protection would be too high for the rich person to afford. It is not an accident that Anarcho-capitalism doesn’t exist. If anarcho-capitalism was a viable political system then it would already be thriving in every country in the world. There is plenty of competition between countries, yet anarcho-capitalism has not emerged. I would argue that tyrannical dictatorships are the result of competing governments and Anarcho-capitalism. The dictators quickly and ruthlessly wipe out their competitors gaining more power. They steal from the rich to give to the poor attaining public support. Surely citizens of these impoverished countries would love to have a competing government challenge the existing one but it is the efficiency of the ruling government that allows it to stay in power. Remember, “efficiency” in this case refers to the ability to control the public and expropriate wealth. The more ruthless a dictator is the more power he has. He competes with other dictators and the most evil, manipulative and “efficient” one wins out.
So if these political systems don’t work, is there any hope? The answer is yes. The greatest political system is an Austro-Libertarian monarchy. Only an austro-libertarian monarchy, equipped with a powerful army, can stand up for private property rights and liberty. This is the only system that will work. It is not as great as anarchy(which unfortunately doesn’t exist) but it restricts competition in political power(“bads”) production and therefore gives political freedom to all its citizens. In this society everything would be privatized including the police(security), the courts and the prisons. The only exception would be that the production of coercion would be monopolized and restricted. The Libertarian King's descendent will not be his children but rather someone will be chosen by the king who clearly has strong beliefs in private property. This system clearly worked when the founding fathers were alive. They were libertarians and when they were around to administer things the country was run outstandingly well. Unfortunately, the democratic system quickly eroded private property rights and showed it's weakness as the people elected leaders who would redistribute wealth. If instead there was a libertarian monarchy a process of successors starting with George Washington as the Monarch, then perhaps Jefferson as the king. He may have appointed Andrew Jackson, who may have appointed Carl Menger, who would have appointed Bohm-Bawerk, who would have appointed Mises, who would have appointed Rothbard, etc. A long line of libertarian monarchs would have ruled. They would have protected private property at all costs and produced the wealthiest country in world history. The country would have been so prosperous it would prove to every other country that they should use the U.S. as a model. Unfortunately today many countries choose socialism as an alternative to U.S. "capitalism". Current U.S. “Capitalism” is more akin to economic fascism or corporatism then to a laissez-faire free market. The socialists constantly criticize the U.S. healthcare system and justify their nationalized healthcare as a good alternative. If the founding fathers had created a Libertarian Monarchy the U.S. would be exactly as free and prosperous as they imagined it. There would be a chain of Austro-Libertarian Monarchs. A dynasty that represented liberty, private property and personal freedom, that could last for hundreds of years.