The Alternative Currency of a 19th Century Abolitionist

Via The Daily Bell

Have you ever had the dream of starting your own society? What about introducing a new currency? Turns out Bitcoin was far from the first private currency.

Josiah Warren didn’t like the political system, and he didn’t like the economic system, so he started his own little alternative community, with a unique medium of exchange. Warren actually started multiple “anarchist” micro-societies, with varying levels of success. Although he never called himself an anarchist, he believed in individual freedom to the point that he argued government was inherently a violation of rights. Continue reading

Startup Societies are the Future

In the past I have fallen into the habit of talking about the problems society faces, mostly from coercive government. These are real problems of which most of us are aware, and there is copious discussion on these topics in older posts on this blog. But at some point, we need to stop identifying the problems with society, and start formulating solutions. Continue reading

The Moral Case for Secession

Secession is a Natural Right

Morality is what is naturally right or wrong. Saying someone has a “right” is a statement about an individual’s condition in nature, absent other parties. That is why rights are expressed in the negative: because a right is a declaration of the natural state of a human, and the assertion that another human that disrupts this natural state is in the wrong. Continue reading

Pissing Away $4 Trillion a Year

How would you spend 4 trillion dollars? We really can’t even comprehend that amount of money. A better question is, how would 318 million Americans (or 243 million federal taxpaying Americans) spend a cumulative $4 trillion if they had a choice?

The federal budget for 2016, is 4.1 trillion dollars. This is not even talking about state and local government spending. Even if you think we need some government, the federal government could cease to exist tomorrow, and we would still have state and local sponsored education, roads, police, and even the national guard. If the United States government disappeared, state and local governments in the United States would still be spending over $3 trillion annually to “keep you safe” or whatever most people pretend the government is good for.

What this all means is that 41% of all the wealth produced in America is pissed away by government every-single-year. And I’m not even going to make my usual anarchist arguments in this post, I do that enough. I just want to point out that the U.S. government could vanish, and the only thing that would change is Americans could spend $4 trillion on the things they want and need instead of the things the American government wants and says we need.

If we are that concerned about crime (even with state and local “authorities” in tact) perhaps American households will purchase crime insurance, which would probably cost about as much per household as home insurance. If each of the 134 million households in America spent an additional $1,000 on average for crime insurance, that would come to $134 billion, which is about 22% of the United States’ annual military budget, and in the same ballpark as the next highest military spender on earth, China.

Maybe some “greedy corporations” would get their hands on the interstate highways, and –gasp– charge a subscription fee for fixing the potholes and infrastructure. If all 210 million licensed American drivers paid $126 per year (the cost of a premier AAA membership) to drive on these roads, that would come to $28.5 billion.

Perhaps without the feds “taking care of the poor” people would want to give a little extra to charity. Apparently 1.3 billion people on earth live in extreme poverty on the equivalent of less than $1.25 per day, so we could double the standard of living of the poorest 20% of earthlings for just $593 billion–still less than the 2016 military budget, and a little over half of the yearly federal spending on welfare.

Don’t know how to distribute that money properly? Neither does the government. But the free market does, or rather, millions of people working together each filling a different niche, interested in a different subculture, and focusing on a particular area, ethnicity, age group, disease etc. know how to get that money where it needs to go.

But you know what, the federal government sponsors a lot of science and research. I know! What if Americans were free to invest their money in their interests, where they think it will pay off, whether it is for new technology, disease cures, or random studies? Maybe without the feds stealing $4 trillion each year, the average American will invest $1,000 in stocks, or trust their local bank to invest it in a mutual fund. That’s $318 billion in extra funding for innovation, research, and technological advance.

And the best part is, all this wealth being properly placed by interested parties will mean even more wealth is created the next year! Sure, federal employees will lose their jobs, but the jobs won’t simply vanish! Instead there will be countless new jobs from the extra investment, countless new jobs from the new charities, countless new jobs from the new industries which create wealth that wasn’t there before.

With people holding onto more of their money, they can spend it on things they care about. A former government employee can finally start that woodworking business he’s always dreamed of, because now his neighbors have enough extra cash to afford his beautiful oak tables. The EPA official who loves nature can start his environmental sustainability website which is paid for by ads from companies who now have more customers to reach. The oak tables and environmental information are new wealth created instead of the unproductive endeavors the government was spending the money on.

The money that the U.S. government wastes on stupid crap like oil subsidies, corrupt politicians, bailouts, war, and ruining honest businesses would instead be spent on productive industry; productive according to whoever earned the money in the first place, and thus should decide how it is spent.

Currently the U.S. government runs on the broken window fallacy. A broken window does not improve the economy, because the person who pays to repair it must spend his money on a window instead of spending it on whatever he wants–a nice dinner out, a new alpaca wool sweater, or a novel by his new favorite author, Joe Jarvis.

Likewise, the U.S. government bombing children in the Middle East does not stimulate the economy, it gives money to defense contractors instead of allowing me and you to spend it where we want: my choice would be on plants for a food forest. What would you spend your stolen money on?

Coming Soon: A Free City in Norway

Scandinavia is often associated with socialism in the muddled minds of Americans. Despite this, one of the world’s first experiment with a completely private city is in Norway. Liberstad aims to provide all services, from roads to fire departments, through the private sector.

Liberstad advertises itself as “a little piece of freedom.” The city’s founders aim to purchase a few hundred acres of farmland in southern Norway to establish a free market enclave.

Their Plan

The project was started by John Holmesland and Sondre Bjellas. They formed the Liberstad Drift Association, which will be responsible for the initial development and operation of the property. Their plan is to build a vibrant community with all the comforts of a modern world, with only minimal laws and taxes.

Liberstad will have no city council or government. Instead, the tone of the city’s development will be organically guided by the first settlers. They can establish businesses, erect buildings, grow vegetables, brew beer, or pursue whatever other economic activity they are interested in.

Liberstad’s few laws and regulations will focus on protecting people’s rights. The founders believe in the non-aggression principle, which states that using non-defensive violence is unethical. They also want to protect participant’s property rights to help grow a thriving free market.

Continue reading about Liberstad, on the Startup Societies blog.

Unity Through Decentralization

This title may sound like an oxymoron. But consider the difference between unity and centralization.

Unity refers to a common cause, and agreement on a goal, but not necessarily the means to get there.

Centralization is the means, supposedly to unite, but in reality to dictate. Centralization does not need agreement to happen, it happens by force, and by the will of those who control the central mechanisms. Political power is centralized, but that does not mean that all those affected by that power are unified.

When centralized without unity, our differences become points of contention and violence. But when unified in a goal without centralization, there is nothing to fight over.

ICHA, the International Coalition for Human Action, promotes unity of “geolibres”, not centralization of these mini free market societies. All geolibres share the same goal, and are therefore unified in the desire to promote individual freedom and create a better system than current governments offer through forced collectivization.

Currency

Let’s take a look at what some claim is the root of all evil: money. Money is simply a placeholder in an advanced economy to make it easier to get the things we need–a facilitator of trade. Money is not the problem, centralization of currency is the problem. The fact that those who centralize the currency manipulate it to their benefit is the problem.

If we are unified in our desire for currency, but disagree on the best currency, the clear solution is to have multiple competing currencies. This way power will never be centralized in the hands of a few politicians, or a few corporations.

Decentralized currency is the key to solving the main problem identified by those who fear corporate power is the catalyst behind government evil. The fear is that consolidation of capital over time will make competition impossible, leading to a feudal type society. Competing currencies will make sure this never happens, because a currency can fail, and become worthless, without upsetting the greater peace and prosperity of a region the way the collapse of a centralized government currency would.

If currency is not centralized, there is no one to force you to use it, and therefore give power to an entity who has amassed tons of the single currency. When major wrongdoing of a company hits the public, the stocks plummet in value. The same thing would happen if people ever lost faith in a currency.

Suppose Amazon had a trillion Amazon dollars, but they stopped delivering the products that people bought on Amazon. Amazon’s trillion Amazon dollars would not be worth very much for very long. Once the promise of redeeming Amazon dollars for goods goes away, then the value of the Amazon dollars follows.

Sure, I might be pissed that I lost 50 Amazon dollars that I had, or even $500, but Amazon dollars are not the only currency I would have. I would also have some silver, some stock in Apple say, a respected bank’s notes, and various other currencies redeemable for actual goods at the stores that issued the currencies. My money portfolio would be diversified, so that even if one currency went away, I would still be able to keep my wealth. As it stands, the dollar is a very poor wealth retention tool, because inflation is constantly devaluing it.

Anarchy in New England Cover (FINAL)[On a related note, in my novel, Anarchy in New England, smaller less stable currencies are bought up by banks who use them as assets to back their own currency, much like a mutual fund. This way there are different levels of stability and value in different currencies. Then there are services, much like a credit card company coupled with a stock exchange, who convert the value of any particular currency into a standard dollar unit when purchasing, so that a dollar never changes in value.]

Why does inflation constantly decrease the value of your dollar? Because government has centralized control over the dollar, and benefits from printing more, since they get to spend the printed money. They have control over the dollars diluting the pool of wealth, so even if a dollar becomes worth half as much, they need only print twice as much to control the same amount of wealth.

If Amazon did the same, the price of their own goods would increase, because while there were more Amazon dollars, the number of goods would not increase. This would reduce business, because Amazon customers’ Amazon dollars would not have increased, yet the Amazon prices would be higher–inflation on a small and contained scale. So even if Amazon executives controlled more Amazon dollars, without people being forced to use them, they would not be controlling any more wealth. It is only their own wealth they have devalued, and that of their customers, who will be angry and taking their business elsewhere.

ICHA Bringing People Together

Decentralizing the currency would bring people together for trade, because it would be much harder to take advantage of consumers. Almost everyone sees the benefit in trade; in specializing to more efficiently serve economic demands. We want an easy way for trade to work, but we don’t want to be robbed, or forced to compete on an uneven playing field. We can unify in our desire for a strong, technological, ever-advancing economy, without having to centralize control over that economy. Decentralizing the currency could unify the economic would.

Likewise, ICHA is a voluntary association of geolibres, because geolibres see the benefit of unity in their goal of free societies. But since they all have different ideas on how to best form and run these societies, centralization would be antithetical to that goal. But suppose all these geolibres agree that their right to self governance should not be violated, and come to the aide of one another when entities attempt to violate this right. ICHA is one organization that can help facilitate this unity that keeps decentralized governance possible.

In the age of information, there is no reason why ICHA and other organization like it cannot perform market functions that keep people free, instead trying to centralize control, which inevitably leads to conflict. Instead, we can all unify in our desires for peace and prosperity.

Property Rights Absent Government

The ends do not justify the means, so arguing that we need a coercive aggressor to determine and protect property rights is philosophically unsound, and immoral. But the ends would also be better with peaceful means; we can have our cake and eat it too. So how do we decide who owns what in a stateless society? And how do we solve potential disputes over property?

Current Private Property in America

First off, what we have right now in America is not private property. Government owns every piece of property in America. If you wish to “own” (live on) this property, and have first dibs for who gets it after you die (inheritance, though the heirs may owe estate or death taxes). Then you must pay the local government property taxes (or rent) every year. If you fail to pay the taxes, it is possible they will come and take your property, but they definitely won’t let it pass to the next generation unless the rent (back tax) is paid.

The federal government also has the power, authorized by the constitution, to take your land at any time. The Fifth Amendment states: “nor shall private property be taken for public use, without just compensation.” The Supreme Court Case Kelo vs. the Town of New London expanded the power of the state from taking land for public use, to taking land for public good, including the tax benefits to the town government if the land is handed over to a company that will pay higher taxes than the previous owner. The amount given for the confiscated land does not have to be your asking price, the same government who takes over the land decides the “just compensation”.

So whatever you think property rights should be under a government, or in America specifically, or what you think they were meant to be, you simply cannot claim that there is private property in America. The is semi-private property that you can rent from the government for periods of a year, which they can take from you at any time, for any reason.

Philosophically Understanding Private Property

Property is something that you have rightfully acquired without coercion through labor or trade, or as a gift from someone who acquired it rightfully. We need property because that is how you collect enough wealth or aggregate enough capital to use it for further wealth creation and technological advance. You cannot build a saw mill without first putting in labor to cut down trees, mill the boards, acquire metal for the saw, and form the metal. Once the saw mill is built, more wealth can be created more easily because you have built up enough capital through labor to use that capital for a productive purpose. All boards henceforth acquired will be “cheaper” or require less labor to produce the same product.

Specializing and trading requires property–what would you trade without property? We want to be able to specialize and trade because that improves the standard of living by producing excess of something that we need, and trading that excess for someone else’s excess. Specializing improves efficiency and output, which is why this leads to an overall increase in wealth for all those who specialize and trade.

It is important to remember that property does not have to be taken from anyone, and more of it can always be created. There are some instances where specific resources are limited, but one goal of technology is to outgrow the need for the limited resources.

There is currently enough habitable land on earth for everyone to have about two acres for themselves. For some people that is enough, some people want way more than that, and some people don’t want any. We all place a different value on different resources, so we don’t all need them to be evenly distributed.

One way this issue has been dealt with is high rises: thousands of people inhabit the same acre by building up, thus creating acres and acres more habitable space. High rises were an economic response to many more people wanting to live in a specific area where there was not enough land to do so.

Perhaps someday there will be overpopulation–if it comes to that as the pace at which society is growing is slowing, and tends to slow more as the standard of living increases. At that point the answer might be making the moon or mars habitable, and it is possible that technology will advance enough by that time to make it possible. But current overpopulation in particular regions is more of a distribution problem: government restrictions stop people from being able to inhabit land from which the government arbitrary bars them.

Without government, people (and therefore markets) would still want private property, because the only other option is collective ownership, which reduces overall production, and therefore overall standard of living, by failing to properly reward producers, and failing to set up a system where there is an incentive to provide your fellow man with something he needs.

Private Property: previously unclaimed land or resources which are not only claimed but manipulated. Also, claimed and manipulated land or resources which have been voluntarily transferred by the owner to your possession, whether through trade or as a gift.

Applying Philosophic Private Property to a Stateless Society

David Friedman gives a good account of private property rights absent moral or legal justification. He uses the Schelling point, or focal point, to explain how two people might interact absent a third party to enforce contracts. A Schelling point is the natural assumption a person would make about how a particular other person will behave in an interaction, considering what they know about the other’s expectations. Each interaction, including a contract, changes the Schelling point, because new expectations are created by the interactions.

Two people are living in a Hobbesian state of nature. Each can injure or steal from the other, at some cost, and each can spend resources on his own defense. Since conflict consumes resources, both could benefit by agreeing on what each owns and thereafter each respecting the other’s property. The joint benefit might be divided in different ways, according to the particular set of property rights they agree on—what property belongs to whom, and whether either has a property right in tribute from the other. This is a special case of the game—bilateral monopoly—described above.

Each player, of course, will threaten to refuse to make any such agreement unless he gets the division he wants. Each will disbelieve most of the other’s threats. If their ability to coerce and defend is roughly equal, and if there is some natural division of contested property (such as a stream running between their farms), it is likely that they will find a Schelling point in the form of an agreement to accept that division, respect each other’s rights, and pay no tribute.

If one (being, perhaps, slightly more powerful) tries to insist on a small tribute, arguing that it will still leave the other better off than continued conflict, the other may believably refuse, arguing that once he concedes any tribute there is no natural limit to what the other can demand. Agreeing to tribute costs the victim not only the tribute but the only available Schelling point. The expected cost to him of such an agreement includes both the possible cost of paying higher tribute in the future and the risk of future conflicts if in the future he rejects demands for higher tribute. That cost may be high enough to make his insistence that he will choose continued conflict over the payment of even a small tribute believable.

So far we have considered the Schelling point that generates an agreement. But the agreement itself, whether generated by a Schelling point or in some other way, is thereafter itself a Schelling point. It is a unique outcome of which both players are conscious. Once it has been made, a policy of “if you do not abide by the agreement I will revert to the use of force, even if the violation is small compared to the cost of conflict” is believable for precisely the same reason the refusal to pay tribute, or any insistence by a bargainer on a Schelling point, is believable. The signing of a contract establishes a new Schelling point and thereby alters the strategic situation. The contract enforces itself.

And there is even more reason to believe the contract will enforce itself with a society larger than two people, because then others will use their behavior to determine if they want to make a contract with the person. The people who abide by the contracts win in the long run, because they are easier to do business with. It would be dangerous to not respect a reasonable property claim, because others will alter their behavior towards you in a negative way.

As with everything, you can never tell exactly how something will go. There could be very different ideas about private property in different regions. But we are essentially at the worst place: all property on earth is owned by a couple hundred entities which are governments. So the only way to go from there, without states, is land ownership being less centralized.

Does someone already claim the land you want to live on? If not, it is not aggression to use it. If yes, you claiming the same land would be aggression.

Unless… someone claims land that they cannot use. A claim is not enough for property ownership, one must also use the land. But simply using it to collect the natural resources also does not make it your land: you must sow as the land, as well as reap it for it to be considered yours. If you claim ownership of 100 acres of forest, but don’t even notice when someone builds a cottage on it, why was that 100 acres yours? If you manicured the lawn, built a fence, or sowed the land, the effort of converting the land into something useful makes it yours.

Example: a deer hunted in the forest belongs to whoever hunted it. The land on which is was hunted does not belong to the hunter, unless he placed the deer there for the purpose of later hunting it. Same goes for an apple tree: simply finding an apple tree does not make it yours, however picking an apple does make the apple yours. Cultivating an apple tree does make it yours, until you stop harvesting the apples.

What if the person claiming the land does not live on it? Have they used time, effort, or resources to manipulate the land? If someone uses their own resources to build a factory, they still own it, because without them others would not be able to use that property for the same economic activity.

My Own Vision for Private Property

Protection of private property would be in demand, so if I were to start a business supplying that demand, I would include private property registration as a service offered by my security company. Depending on “crime insurance” plans, private property registration might be included or cost an additional fee. But what you would be paying for is a company to go to bat for you in land disputes.

As a security company, I would set guidelines for the type of property I would protect, and to what degree. I would start by designating some areas in which I would never register private property, like popular hiking mountains, some beaches, and natural landmarks like the Grand Canyon. I would also encourage competitors to consider these areas “protected,” meaning they won’t necessarily stop people from inhabiting the areas, but will not protect the areas as any one individual’s property. This would be in the best interests of my security company, as well as others, since these popular places would be where the most likely disputes over property would take place.

By taking the position that certain areas like mountain peaks cannot be claimed by an individual, it would save the company money and headaches, and also keep limited natural scenic areas open to the public. Perhaps the Appalachian Mountain Club would team up with my company to report any issues if someone did try to claim open land, but I am guessing it would rarely become an issue. Most people just want to hike a mountain, and most people won’t try to monopolize it, or stop others from hiking it.

If disputes did arise over land ownership, it would be up to the security companies and their arbiters to work out the resolution. They would investigate the claims, and decide who had the more legitimate claim. If the security companies disagreed, their arbiter–who they voluntarily go to in order to solve disputes without costly violence–would decide.

I think this would be a better scenario for determining land ownership than government, because government will take the position that benefits government, or whoever has bought the government. Governments currently do not ensure private property, they monopolize it, and then decide on who gets to use it, and under what circumstances.

In a stateless scenario, there would be no third party involvement unless their was a dispute over the land. As David Friedman discussed, disputes are likely to be solved by those involved in order to avoid the costs of the dispute, and encourage smooth transactions with others in the future. And if a dispute had to be solved by a security company, the outcome would also likely be peaceful and more fair, because they have incentives to both serve their customers, and avoid the costs of conflict.

You Don’t Always Need to Know How It Works, to Know It Works

This was shared by the Facebook page Emancipated Human:

Although I can talk at length as to how a Voluntary or Stateless society may function, the reality is that this is fundamentally irrelevant to the idea of true freedom. Do you know exactly how your laptop works? Do you know exactly how your cell phone works? Do you know exactly how Skype works? Do you know exactly how the Internet works? Do you know exactly how your e-mail account transmits an e-mail? Do you know exactly how your car works?

The reality is many of us live in complete ignorance of how all of these things work and yet we are still comfortable to buy them from people who know how they work. Likewise it is similarly unnecessary to know how society may be “structured” in the absence of the coercive monopoly on initiated aggression known as “government”.

My desire to be free has absolutely nothing to do with how the roads will be built, who will feed the poor, who will protect us from foreign invaders, who will protect us from thieves, rapists, and murderers, who will take care of the sick, who will look after the elderly, and who will educate our children.

Aside from the erroneous assumption that “government” is adequately doing these things already is the fact that theft, assault, rape, and murder on a colossal scale is occurring today even amidst such a swollen monstrosity as the United States “government”.

Our desire to protect ourselves from thieves, liars, and murderers has given us the insane belief that we will be protected from them if we put other thieves, liars, and murderers into power. Sane people do not seek to subjugate or rule their neighbor, let alone their town, county, city, state, or country. It is not only that power corrupts but that it attracts the corruptible and vile among us. The lust for power is more addictive than cocaine or heroin can ever be. Vacate the State! – DC

With economic knowledge of the free market, we can be sure that all those things government monopolizes and does horribly (keeping you safe, roads, helping the poor) would be done better. That doesn’t mean I have to know exactly how it would function, just as I don’t know exactly how everything in the grocery store ends up on the shelf every time I go in to buy it. But it does.

When things are in demand, and people are free to voluntarily supply those demands, and others can voluntarily accept the service or goods offered for the price, there is nothing else to worry about! Keeping an eye on businesses from which you can simply remove your funding voluntarily will produce much better results than forcing everyone to pay for things they may disagree with, not want, or not use.

But it is always still worth questioning how these things might happen in the absence of a coercive violent monopoly.

How might the roads be built?

How might populations be defended from invasion?

What would happen to the poor?

The case for improvement, even if it is not heaven on earth.