Does the Free Market Presuppose the State?

Finally finished Man, Economy, and State after only 2 years! (Yes, I read other stuff and took huge breaks in between haha)

Done! Only took me 2 years. Reading a Harry Potter book in one day doesn't train you for 1100 pages of econ.

A post shared by Bharat Chandrasekhar (@negligible91) on

Now I’m going to start reading a bit of Power and Market in my free time, but mainly I’ll be reading a book called The Last Superstition by Edward Feser.

Regardless, here’s a short passage I just read from Power and Market:

The laissez-faireists offer several objections to the idea of free-market defense. One objection holds that, since a free market of exchanges presupposes a system of property rights, therefore the State is needed to define and allocate the structure of such rights.

This is an important argument to deal with. Here’s an analogy: if someone said the natural sciences presuppose free will, then the natural sciences cannot tell us anything about free will. Likewise, if the free market presupposes a system of property rights, someone could argue the latter must be built outside of the free market.

But there is nothing obviously wrong about saying defense can be provided by the free market even if the free market presupposes property rights. All that’s needed is a slight semantical change. Let’s say 10% of the free market is defense and 90% of the free market is the other stuff. I can say that 90% of the free market presupposes the other 10% of defense services. There is nothing illogical about this.

By acknowledging defense services can be provided by the free market, we can have a consistent libertarian theory unimpinged by a State that so clearly contradicts it.

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Posted on June 30, 2013, in Ethics and tagged , , , , , , , . Bookmark the permalink. 18 Comments.

  1. I think a free market presupposes a free society, which requires an apparatus to defend people’s rights in society. So to me, to say that any percent of the free market will provide defense services already presumes there is a free society.

    • Hi Justin, thanks for your comment! What do you mean by ‘free society’ and how exactly are you differentiating it from a ‘free market’?

      • Good question. To me a free market is where the process of exchange is voluntary, where people trade their goods or services with willing partners. A free society is more broad, and includes things like freedom of speech and due process. A free society is where people are free to act within the sphere of their rights.

        • Just to clarify, is the “apparatus” you mention in your first comment referring to the State?

          Also, do you think that private property rights are part of a free society, and do you think things like freedom of speech fall under those (e.g. because I own my body and own my house, I can say whatever I want there, but I wouldn’t necessarily be able to say whatever I wanted at someone else’s place).

          • Right, that apparatus is the state, which enforces rules of conduct within a given territory that cannot be challenged with impunity.

            I do think property rights are part of free society, but there are also rights (i.e., the right to life and liberty) that are not subject to (market) exchange. That’s why I think of a free market as being part of a free society.

            • Go ahead and start a new string of comments with your next post (these strings become smaller and smaller and eventually become overly small, so I set a limit of 6 to it).

              Anyway, I think a possible slight difference between what you and I believe (although it may just be semantics) is that I think that private property rights are the defining feature of a free society. According to your definition of a “free market” in exchange, I can agree that a “free society”, i.e. private property rights (my definition) necessarily comes before that and is presupposed by that.

              If you can expand on what you mean by other rights, I think we can get some more clarity though. Do you think those other rights fall under property rights as well? The theory that Rothbard espoused, and the one I subscribe to, is that private property, including both self-ownership and ability to appropriate other objects as well, come first and before all other rights. You can do as you wish (i.e. liberty) as long as you do not aggress against other people’s rights (their self-ownership or ownership of other objects). You also have a right to your life as long as you do not aggress against others. For example, a “right to life” does not mean you can take another person’s body part against his consent even if you’re about to die and he would not die without it. Same example for speech I gave above: you can say whatever you want in your own house but not someone else’s. Do you agree with this or do you have some other conception of other rights and liberties outside of private property rights?

            • I think we’re on the same page: a person morally may not violate another’s rights. I just view the right to life as conceptually distinct from the right to liberty and property. In a metaphorical sense, I agree you effectively own your own life.

            • I’m still a little confused, but I’ll re-read your post. Meanwhile, do you think you could answer my specific examples?

            • I thought I had, but no problem.

              Do you think those other rights fall under property rights as well?

              I don’t believe all rights are property rights, but that property rights are a corollary of the right to life.

              Same example for speech I gave above: you can say whatever you want in your own house but not someone else’s. Do you agree with this or do you have some other conception of other rights and liberties outside of private property rights?

              I agree that you can’t just speak what you want on someone’s home. One person’s rights do not conflict with another.

            • Same for the liver example as well then? If I am about to die, and your liver can save me, do I have the right to take your liver without your consent (assuming you wouldn’t die without it)?

            • No, you can’t morally take someone’s liver without permission.

              Do I get a cookie for answering these questions? 🙂

            • Yes! You get a cookie for every question!

              So the reason I’m asking these questions is because I’m trying to understand your philosophy for myself before I ask: why do you think the State isn’t contrary to the principles you hold?

              (Now, if you explain this to me, I hopefully have some insight into your premises that will help me understand it better. I did re-read that post and I think I understand it a little better)

              I think the case against the State from your principles is fairly straight-forward. If you think property rights are one of the features of a free society, an institution created without the consent of the individuals it claims authority over is obviously a violation of the property rights these individuals hold in themselves and the property in objects they have. As such, a State cannot be part of a free society; it is antithetical to it.

            • an institution created without the consent of the individuals it claims authority over is obviously a violation of the property rights these individuals hold in themselves and the property in objects they have. State cannot be part of a free society; it is antithetical to it.

              I agree states could (and commonly do) violate the principles of a free society. It depends on the content of the laws enforced and the procedures by which they are enforced.

              We likely agree that people have the right to organize for their self-defense and act in the defense of others, but we have a different understanding of what that entails. Because the nature of force is destructive, unlike any other economic good, force is inherently monopolizing. In any given territory, if a legal system (like one that codifies the non-aggression principle) is to prevail, it must be enforced at the exclusion of all others. Therefore, I don’t find it objectionable if I don’t have someone’s permission to enforce my rights; I’m not claiming authority over anyone by exercising my rights. Under a proper government (one limited to defending the rights of individuals), I’m denying criminals their claim of authority over me!

            • I’m specifically talking about the power to tax, and the definition of the State set out by Rothbard. Isn’t taxation – the coerced funding of the State – involuntary and a transgression against property rights?

              Do you have a different definition of the State? I agree that individuals may defend themselves and set up an institution that defends their rights, as long as it is voluntarily funded.

            • I agree taxation is immoral, but I don’t agree taxation is necessary for the financing of a government since there are several ways of raising funds non-coercively, I believe.

              I think of the the state as the dominant political institution enforcing certain rules of conduct within a given geographical area, meaning it cannot be challenged with impunity. it seems Rothbard’s definition begs the question about the ethical nature of the state.

            • Hey, sorry for the late response!

              Definitions are somewhat arbitrary and arguing over them is just semantics, so let’s go with your definition because I just want to understand exactly what sort of institution will be in society. When you say “dominant” within a certain “geographical area,” are you saying it’s a monopoly within that area? If so, does your state follow the non-aggression principle when it comes to law? And if so, how can it follow the NAP itself if it is outlawing “competing” libertarian political institutions?

            • Think what it would mean in practical terms to have competing legal agencies. That would mean competing definitions of “rights,” “aggression,” “coercion,” and “self-defense”, etc., and competing laws and legal procedures. Because of the monopolizing nature of coercion, only one set of definitions, laws, and procedures may be enforced with a given geographic territory at a given time.

              Either competing legal agencies will enforce their decisions, or they won’t. If they do, they would be imposing their legal system to outlaw competing legal agencies and individuals who have not explicitly consented to those agencies, just like a state.

            • Hey Justin, thanks for taking the time to discuss this with me. I get what you’re saying right now, although I think how the conversation originally started may have been due to different definitions of the State. I think your definition is reasonable though and might even be valid in adopting. Something for me to think about. Thanks!

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