In this short essay, I will take the unorthodox position that the State is not only an evil, but an unnecessary one at that.  Naturally brevity prevents a comprehensive case, yet I hope to raise issues that will give the reader pause.

Let me first make the claim (without adequate justification) that no purely ethical defense of the State is valid, because the State is by its very nature an institution that relies upon coercion.  If everything that a State did were voluntary, then it would be a club or a fraternal organization.  There is simply no getting around this; all the stories concerning “consent” are just that, stories.  In particular, the birth of all actual States (as opposed to those in the expositions of political philosophers) have involved varying degrees of violence threatened upon admittedly innocent people.  (For example, certain Americans were compelled to join the newly formed federal government after the ratification of the Constitution.  Support for the new regime was certainly not unanimous.)

This leads us then to the pragmatic justification for the State.  “Yes,” the statist may say, “in a perfect world violence would only be used against lawbreakers, and not ordinary citizens.  But we need a government to do certain things such as provide law and defense, and we couldn’t do this without collecting taxes from everyone.”  I will devote the remainder of this essay to refuting this popular justification by arguing that law and defense can in fact be provided in a free market.

The case for market-based military defense is conceptually easier, so I’ll tackle it first.  In a modern economy insurance companies would probably be the ones providing the “military budget.”  First consider a community that had no “organized” defense beyond the private arms held by its people.  If a neighboring State were to launch bombers and missiles, surely these people would be crushed.  Yet that it precisely why insurance companies (who held policies on the property and lives in the affected region) would have an incentive to hire firms to provide tanks, jet fighters, SAM sites, etc. to repel such an invasion.  Expenditures on such “preventive measures” would pay for themselves, just as an insurance company might provide fire extinguishers for an office building free of charge.

Private defense firms would have huge advantages over government-regulated rivals.  The most obvious difference would be the cost-consciousness of the former.  We are all familiar with the anecdotes of $600 toilet seats in the Pentagon budget.  But we should also realize that, say, the $30 million price tag on an F-14 Tomcat is similarly outrageous.  In a free market, insurance companies would pay far lower prices for equivalent military hardware than their potential statist enemies.

Before leaving the issue of military defense, let me ask the reader to not confuse apples with oranges.  I am not claiming that any private region would be able to repel all possible government armies.  Rather, I am claiming that to place military defense in the hands of the government will make a region less secure.  So yes, a tiny private society would be conquered by Nazi Germany, but as history showed plenty of smaller States, relying on government defense, were also conquered by Hitler.

The area of law is quite complex and I can’t do it justice here (no pun intended).  The essential insight is that a just legal code is not arbitrary; private judges could grasp and apply principles in particular cases that were brought before them, principles that outsiders would recognize as equitable.  Just as mathematicians can (without recourse to violence) recognize and promote “good math” when they see it—and disputes are handled in the journals and other forums—so too would a system of purely voluntary legal decisions give rise to a generally accepted (and constantly evolving) body of law.  To switch analogies, “the experts” (and these experts are not picked via coercion) can write dictionaries and grammar books codifying the rules spontaneously adopted by a given community; no one thinks that “words mean whatever the dictionary publishers say they mean.”  By the very same token, judges who made clearly biased or incompetent rulings would go out of business, because their livelihood would depend on disputants voluntarily submitting their case to a particular judge.

The arguments above are obviously just a quick sketch of the workings of a truly free society.  In closing I make one final request:  Before the reader dismisses the proposed institutions as “unworkable,” he or she should first define in what sense the State analog “works.”  The question is not, for example, “Would serial killers exist under a private legal system?”  The question is rather, “Would there be more or fewer serial killers?”  For clearly under the present system, serial killers have not been eliminated, nor has the US federal government protected us from terrorists.

Robert P. Murphy teaches economics at Hillsdale College. He prepared the Home Study Course in Austrian Economics, which is available for $350. See his archive. Send him mail.

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