And who would build the roads?

10 min readSep 21, 2023

In the landscape of political and economic ideologies, anarcho-capitalism stands as a unique and often controversial concept. At its core, it envisions a society without a centralised government, where individual liberties, property rights, and free-market capitalism are the guiding principles.

In this exploration of anarcho-capitalism, we will delve into the fundamental tenets of this ideology, its historical roots, and its place in modern discourse. Whether you’re a staunch supporter, a curious observer, or a sceptic, this blog aims to shed light on the principles that underpin this stateless vision.

ELI5

I think it’s appropriate to first demystify the concepts of anarchy and capitalism.

Anarchy is a political philosophy and state of society characterised by the absence of a centralised government or ruling authority. In an anarchist society, there is no hierarchical or coercive governing structure, and individuals are free to govern themselves and make decisions collectively through voluntary associations. It’s important to understand that a lack of rulers does not mean a lack of rules. Anarchists advocate for a society based on principles of individual liberty, direct democracy, and voluntary cooperation. So there are rules in anarchism, the difference is that those rules are agreed to rather than imposed, and the structure of society is flat rather than hierarchical.

It’s also important to note that there are various forms of anarchism, ranging from anarcho-communism, which promotes communal ownership and cooperation, to anarcho-capitalism, which advocates for a stateless society based on free-market capitalism.

Capitalism is an economic and social system characterised by private ownership of the means of production and the pursuit of profit through competitive markets. The key concepts here are the concepts of property rights and free markets. In a capitalist system, individuals or private entities own and control businesses, factories, and resources. Unfortunately we haven’t yet been able to test the efficacy of a true capitalist society. We can observe that the closest a society is to capitalism, the richer and more developed it is, but socialism still has a strong grip on all societies around the world, because governments want/need power, and socialism is the philosophy that hands it to them.

Fireworks

So what happens when we put the two together? Anarcho-capitalism, as the name suggests, is a fusion of the two distinct ideologies: anarchism and capitalism. At its heart, it advocates for the absence of a centralised government, envisioning a society in which all interactions, including economic transactions, are voluntary and free from coercion. To achieve a true anarcho-capitalist society, we need to have:

A Stateless Society: The complete abolition of government or the state. Governance can be achieved through voluntary associations and free-market mechanisms rather than a centralised authority.

Private Property Rights: This concept is fundamental and any transgression would mean that such a society is no longer anarcho-capitalist. Any income taxes or inflation through the printing of money out of thin air, is to put it bluntly, stealing, and as such, a blatant transgression of this concept. Individuals have the right to own, use, and exchange property without interference or having to pay for the privilege, provided it does not violate the non-aggression principle.

Non-Aggression Principle: This forms the ethical foundation of anarcho-capitalism. It asserts that no one should initiate force or aggression against another individual or their property. Defensive force is permissible in response to aggression. There’s not a single society in the world that respects this principle.

Voluntary Interactions: Let me emphasise the importance of voluntary interactions in all aspects of society. From commercial transactions and contracts, to relationships and associations, or investments in infrastructure that benefits its society, should be consensual, without any form of coercion. People are not stupid and will invest in the infrastructure needed to benefit their lives. Not everyone will invest in the same things but there are plenty of examples of local roads built by communities and trade associations without any involvement from governments.

Minimal or No Government: The idea of a centralised government, can be entertained, as long as it’s small enough and as flat as possible — read, as decentralised as possible — and it doesn’t infringe on any of the previous expounded concepts. The idea is of minimal or competing governments that provide essential services on a voluntary basis.

Free-Market Capitalism: Anarcho-capitalism promotes unrestricted free-market capitalism as the economic system of choice. It posits that voluntary exchanges in a competitive marketplace lead to efficient resource allocation and prosperity.

A bit of history

To truly understand anarcho-capitalism principles, let’s look at its historical origins and development:

Early Roots: The seeds of this philosophy can be traced back to classical liberal thinkers such as John Locke, who championed the sanctity of private property and individual liberty. These ideas laid the groundwork for later libertarian and anarcho-capitalist thought. Now, I have in my “To Read” list “Inventing the Individual: The Origins of Western Liberalism” by Larry Siedentop, which I know is a thought-provoking exploration of the historical development of Western liberalism and the concept of the individual in Western thought, as Siedentop argues that the unique emphasis on individualism and personal conscience, which underpins Western liberal democracy, has deep roots in the history of Christianity. Before Christianity, the concept of the individual didn’t exist. I know this is difficult to grasp, but everyone thought of themselves as a part of a family and never as an individual, and as such, property was also, family property rather than any individual’s property. I still have to read the book though.

Influential Figures: One of the early figures associated with anarcho-capitalism is Gustave de Molinari, a 19th-century Belgian economist and theorist who proposed the idea of private defence agencies and arbitration in lieu of a centralised state. However, it was the 20th century that saw the development of anarcho-capitalism as a distinct ideology.

Murray Rothbard: Often regarded as one of the founding fathers of anarcho-capitalism, Murray Rothbard’s work, particularly in his book “The Ethics of Liberty,” provided a philosophical foundation for the ideology. Rothbard argued for the complete elimination of the state and the application of property rights and free markets to all aspects of society. If you read no one else on Austrian Economics, read Rothbard.

Influence of Austrian Economics: Anarcho-capitalism has close ties to the Austrian School of Economics, which emphasises the role of individual actions and market forces. Figures like Ludwig von Mises and Friedrich Hayek contributed to the economic underpinnings of anarcho-capitalism.

Modern Development: In recent decades, thinkers like David D. Friedman and Hans-Hermann Hoppe have continued to refine and expand upon anarcho-capitalist ideas, addressing practical challenges and ethical questions.

I’m not convinced

As with any ideological framework, this one is not without its share of criticisms and controversies. Some of the common points of contention are:

Lack of Social Safety Nets: Critics argue that the absence of a centralised state in anarcho-capitalism would lead to a lack of social safety nets, potentially leaving vulnerable individuals without support.

Anarcho-capitalist proponents contend that in a voluntary society, individuals and organisations could still provide charitable assistance and mutual aid, potentially leading to more effective and compassionate forms of support. But more than that, we would have a completely different mentality from every citizen in society leading to a much lesser number of people that find themselves in situations of need. Our current nanny state type of governments lead to more vulnerable individuals (is it by design?)

Potential for Exploitation: Sceptics raise concerns about the potential for powerful private entities to dominate in the absence of government regulation, potentially leading to exploitation and inequality.

Competition and the absence of government-granted privileges would limit monopolistic behaviour rather than lead to it. Voluntary interactions and free-market competition address such issues, whilst government intervention, actually worsens them. Thomas Sowell delves into this phenomenon brilliantly in his book “Basic Economics”.

Arbitration and Defense: Critics question the feasibility of private defence agencies and arbitration services, expressing concerns about impartiality and conflicts of interest.

But competition among service providers would incentivize fairness and efficient conflict resolution. The market could offer a variety of arbitration and defence options to meet diverse needs. It’s the current system we have in place that is indeed impartial and leads to conflicts of interest between the people and the those in power (don’t tell me you’re in for all the wars that are still going on in the world)

While these criticisms highlight the controversies associated with anarcho-capitalism, anyone that understands the ideology can easily offer counterarguments and explore practical solutions to address these concerns.

It will never happen

While for some this ideology presents a compelling vision of a stateless society, the practical implementation of such a system raises several challenges. But where there’s a will there’s a way.

Private Defence and Security: In an anarcho-capitalist society, private defence agencies and security firms might replace traditional police and military forces. How would these agencies prevent conflicts and maintain order while avoiding abuse of power?

I think it’s important to understand that this is what we have in place today. Those in power are abusing their power and if you have enough money, you can get away with anything, literally. If the decision making process is not centralised, and the defence and security is privatised, then competition will lead to fairer costs and much more difficult to be corrupted because of the decentralised nature of the decision process. People are on aggregate, fair and just, it’s just when it’s about them individually that they can become unfair and unjust. So decentralisation leads to a fairer and more just society with much less opportunity for corruption.

Dispute Resolution: Without a centralised legal system, dispute resolution could rely on private arbitration services. How would individuals access fair and impartial arbitration, especially in cases involving large disparities in wealth or power?

The same rationale I mentioned above, applies. In the current system, you’re led to believe that the judicial branch is separate from the legislative and executive branch but that’s not entirely true. It’s not completely false, but due to the centralised nature of governments, it leads to a system that is much easier to corrupt than otherwise.

Just like today, mechanisms for oversight and accountability could be implemented to prevent collusion or abuse of power among private entities. Independent auditing, reputation systems, and contractual agreements are some of the tools we could use just like we use today. I think the main difference would be that we would start from a place of much less opportunity for abuse of power.

Property Rights: The protection of property rights is fundamental to anarcho-capitalism. However, disputes over property boundaries and ownership could become more common. How would these disputes be resolved peacefully?

Protecting individual rights would be a significant challenge. But as already mentioned, competition among private defence agencies and dispute resolution services would help safeguard individual liberties. Are we seeking utopia, or just a fairer, freer society?

There are more challenges and criticisms, some that I have mentioned before and others that I haven’t. But the real crux of the problem is that we haven’t been able to truly test this ideology. People think of the USA as a capitalist society; and use that to scoff at capitalism; but they aren’t in the least. In a capitalist society, you wouldn’t have a Central Bank, private as is the case, or public. You wouldn’t have tariffs and all sorts of regulations on trade, imports and exports, and I could continue listing possibly hundreds of areas where the USA rules through socialism rather than capitalism.

You’re not paying attention

Anarcho-capitalism’s presence has left its mark on libertarian movements worldwide. Libertarians who advocate for limited government intervention often draw on anarcho-capitalist principles, emphasising individual freedoms, free markets, and the reduction of state authority.

Figures like David D. Friedman, the author of “The Machinery of Freedom,” and Hans-Hermann Hoppe “Democracy: The God That Failed”, known for his work on private property and anarcho-capitalist thought, have contributed significantly to contemporary discussions surrounding this ideology.

The rise of cryptocurrencies and the concept of “crypto-anarchy” align closely with anarcho-capitalist ideals. Decentralised digital currencies and technologies that operate outside of traditional government control. These advancements in technology are reshaping the discourse around the feasibility of anarcho-capitalism. Bitcoin, offers the potential for decentralised systems of governance and finance.

Online communities and social media platforms allow individuals to engage in decentralised forms of communication and information sharing. These platforms empower users to connect, organise, and advocate for anarcho-capitalist principles. And even though these platforms are still centralised, we’re starting to see the first offsprings of decentralised social media platforms.

Conclusion

Are you sold on a vision of a stateless society based on individual liberty, voluntary cooperation, and free markets?

This ideology raises vital philosophical and practical questions, continuing to exert influence in modern political discourse. Are we truly living in the best possible society, or can we make improvements? Do we underestimate our capacity to peacefully organise and lead freer, fairer lives? Is there an underlying fear of power that compels us to surrender it willingly to a minority? And why do the words and concepts of anarchy and capitalism bear such heavy stigma and vilification, to the extent that even referencing them can brand one as a societal outsider (loony)?”

If I had to conclude with one word, I would use a word that I think leads to most of the problems in the world — Misdirection.