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Anarcho-capitalism

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   Anarcho-capitalism (also known by other names, such as free market
   anarchism) is an individualist political philosophy that advocates the
   provision of all goods and services—including law enforcement, courts,
   and national defence—by competitors in a free market.
   Anarcho-capitalists argue for a society based in voluntary trade of
   private property and services in order to maximize individual liberty
   and prosperity, but also recognize charity and communal arrangements as
   part of the same voluntary ethic. Though anarcho-capitalists are known
   for asserting a right to private property, common property can also
   exist in an anarcho-capitalist society. For them, what is important is
   how property was acquired and transferred; they believe the only just
   way to acquire property is through voluntary trade, gift, or
   labor-based original appropriation, rather than through aggression or
   fraud.

   Anarcho-capitalism rejects the state, based on the belief that states
   are aggressive entities which steal property (through taxation and
   expropriation), initiate physical force, use their coercive powers to
   benefit some businesses and individuals at the expense of others,
   create monopolies, and restrict trade. This embrace of unfettered
   capitalism leads to considerable tension between anarcho-capitalists
   and those anarchists who believe that capitalism is inherently
   authoritarian and hence incompatible with anarchism.

   The first well-known version of anarcho-capitalism was developed by
   Austrian School economist and libertarian Murray Rothbard in the
   mid-20th century, synthesizing elements from the Austrian School of
   economics, classical liberalism, and 19th century American
   individualist anarchism. He defines free-market capitalism as "peaceful
   voluntary exchange," in contrast to state capitalism which he says is
   "violent expropriation." Central to Rothbard's theory of
   anarcho-capitalism is the sovereignty of the individual and the
   principle of non-aggression. However, various theorists have differing,
   though similar, philosophies which they label anarcho-capitalism. While
   Rothbard bases his philosophy on rationalist natural law, others, such
   as David Friedman, take a pragmatic consequentialist (utilitarianist)
   approach by appealing to what satisfies the greatest number of people
   rather than addressing moral concerns. In Rothbard's form, a legal code
   is implemented that forbids aggressive coercion. However, in Friedman's
   anarcho-capitalism, market forces determine the content of the law.
   Hans-Hermann Hoppe, meanwhile, uses " argumentation ethics" for his
   foundation of "private property anarchism," and is closer to Rothbard's
   natural law approach.

Philosophy

The nonaggression axiom

    The term anarcho-capitalism was most likely coined in the mid-1950s by
        the economist Murray Rothbard. Other terms sometimes used for this
          philosophy, though not necessarily outside of anarcho-capitalist
                                                         circles, include:
     * anti-state capitalism
     * anti-state marketism
     * anarcho-liberalism
     * capitalist anarchism
     * free market anarchism
     * private-property anarchy
     * radical capitalism
     * right-anarchism
     * stateless capitalism
     * stateless liberalism
     * the private-law society
     * individualist anarchism

   Anarcho-capitalism, as formulated by Rothbard and others, holds
   strongly to the central libertarian nonaggression axiom:

          [...] The basic axiom of libertarian political theory holds that
          every man is a self owner, having absolute jurisdiction over his
          own body. In effect, this means that no one else may justly
          invade, or aggress against, another's person. It follows then
          that each person justly owns whatever previously unowned
          resources he appropriates or "mixes his labor with." From these
          twin axioms — self-ownership and " homesteading" — stem the
          justification for the entire system of property rights titles in
          a free-market society. This system establishes the right of
          every man to his own person, the right of donation, of bequest
          (and, concomitantly, the right to receive the bequest or
          inheritance), and the right of contractual exchange of property
          titles.

   Rothbard's defense of the self-ownership principle stems from his
   falsification of all other alternatives, namely that either a group of
   people can own another group of people, or the other alternative, that
   no single person has full ownership over one's self. Rothbard dismisses
   these two cases on the basis that they cannot result in an universal
   ethic, i.e., a just natural law that can govern all people, independent
   of place and time. The only alternative that remains to Rothbard is
   self-ownership, which he believes is both axiomatic and universal.

   In general, the nonaggression axiom can be said to be a prohibition
   against the initiation of force, or the threat of force, against
   persons (i.e., direct violence, assault, murder) or property (i.e.,
   fraud, burglary, theft, taxation). The initiation of force is usually
   referred to as aggression or coercion. The difference between
   anarcho-capitalists and other libertarians is largely one of the degree
   to which they take this axiom. Minarchist libertarians, such as most
   people involved in Libertarian political parties, would retain the
   state in some smaller and less invasive form, retaining at the very
   least public police, courts and military; others, however, might give
   further allowance for other government programs. In contrast,
   anarcho-capitalists reject any level of state intervention, defining
   the state as a coercive monopoly and, as the only entity in human
   society that derives its income from legal aggression, an entity that
   inherently violates the central axiom of libertarianism.

   Some anarcho-capitalists, such as Rothbard, accept the nonaggression
   axiom on an intrinsic moral or natural law basis. It is in terms of the
   non-aggression principle that Rothbard defined anarchism; he defined
   "anarchism as a system which provides no legal sanction for such
   aggression ['against person and property']" and said that "what
   anarchism proposes to do, then, is to abolish the State, i.e. to
   abolish the regularized institution of aggressive coercion." In an
   interview with New Banner, Rothbard said that "capitalism is the
   fullest expression of anarchism, and anarchism is the fullest
   expression of capitalism." Alternatively, others, such as Friedman,
   take a consequentialist or egoist approach; rather than maintaining
   that aggression is intrinsically immoral, they maintain that a law
   against aggression can only come about by contract between
   self-interested parties who agree to refrain from initiating coercion
   against each other.

Property

Private property

   Central to anarcho-capitalism are the concepts of self-ownership and
   original appropriation:

     Everyone is the proper owner of his own physical body as well as of
     all places and nature-given goods that he occupies and puts to use
     by means of his body, provided only that no one else has already
     occupied or used the same places and goods before him. This
     ownership of "originally appropriated" places and goods by a person
     implies his right to use and transform these places and goods in any
     way he sees fit, provided only that he does not change thereby
     uninvitedly the physical integrity of places and goods originally
     appropriated by another person. In particular, once a place or good
     has been first appropriated by, in John Locke's phrase, 'mixing
     one's labor' with it, ownership in such places and goods can be
     acquired only by means of a voluntary — contractual — transfer of
     its property title from a previous to a later owner.

   Anarcho-capitalism uses the following terms in ways that may differ
   from common usage or various anarchist movements.
     * Anarchism: any philosophy that opposes all forms of initiatory
       coercion (includes opposition to the State)
     * Contract: a voluntary binding agreement between persons
     * Coercion: physical force or threat of such against persons or
       property
     * Capitalism: economic system where the means of production are
       privately owned, and where investments, production, distribution,
       income, and prices are determined through the operation of a free
       market rather than by government
     * Free market: a market where all decisions regarding transfer of
       money, goods (including capital goods), and services are voluntary
     * Fraud: inducing one to part with something of value through the use
       of dishonesty
     * State: an organization that taxes and engages in regularized and
       institutionalized aggressive coercion
     * Voluntary: any action not influenced by coercion or fraud
       perpetrated by any human agency

   This is the root of anarcho-capitalist property rights, and where they
   differ from collectivist forms of anarchism such as anarcho-communism
   where the product of labor is collectivized in a pool of goods and
   distributed "according to need." Anarcho-capitalists advocate
   individual ownership of the product of labor regardless of what the
   individual "needs" or does not need. As Rothbard says, "if every man
   has the right to own his own body and if he must use and transform
   material natural objects in order to survive, then he has the right to
   own the product that he has made." After property is created through
   labor it may then only exchange hands legitimately by trade or gift;
   forced transfers are considered illegitimate. Original appropriation
   allows an individual to claim any "unused" property, including land,
   and by improving or otherwise using it, own it with the same "absolute
   right" as his own body. According to Rothbard, property can only come
   about through labor, therefore original appropriation of land is not
   legitimate by merely claiming it or building a fence around it; it is
   only by using land — by mixing one's labor with it — that original
   appropriation is legitimized: "Any attempt to claim a new resource that
   someone does not use would have to be considered invasive of the
   property right of whoever the first user will turn out to be." As a
   practical matter, in terms of the ownership of land,
   anarcho-capitalists recognize that there are few (if any) parcels of
   land left on Earth whose ownership was not at some point in time
   obtained in violation of the homestead principle, through seizure by
   the state or put in private hands with the assistance of the state.
   Rothbard says in "Justice and Property Right" that "any identifiable
   owner (the original victim of theft or his heir) must be accorded his
   property." In the case of slavery, Rothbard says that in many cases
   "the old plantations and the heirs and descendants of the former slaves
   can be identified, and the reparations can become highly specific
   indeed." He believes slaves rightfully own any land they were forced to
   work on under the " homestead principle." If property is held by the
   state, Rothbard advocates its confiscation and return to the private
   sector: "any property in the hands of the State is in the hands of
   thieves, and should be liberated as quickly as possible." For example,
   he proposes that State universities be seized by the students and
   faculty under the homestead principle. Rothbard also supports
   expropriation of nominally "private property" if it is the result of
   state-initiated force, such as businesses who receive grants and
   subsidies. He proposes that businesses who receive at least 50% of
   their funding be confiscated by the workers. He says, "What we
   libertarians object to, then, is not government per se but crime, what
   we object to is unjust or criminal property titles; what we are for is
   not "private" property per se but just, innocent, non-criminal private
   property." Likewise, Karl Hess says, "libertarianism wants to advance
   principles of property but that it in no way wishes to defend, willy
   nilly, all property which now is called private...Much of that property
   is stolen. Much is of dubious title. All of it is deeply intertwined
   with an immoral, coercive state system." By accepting an axiomatic
   definition of private property and property rights, anarcho-capitalists
   deny the legitimacy of a state on principle:

          "For, apart from ruling out as unjustified all activities such
          as murder, homicide, rape, trespass, robbery, burglary, theft,
          and fraud, the ethics of private property is also incompatible
          with the existence of a state defined as an agency that
          possesses a compulsory territorial monopoly of ultimate
          decision-making (jurisdiction) and/or the right to tax."

Common property

   Though anarcho-capitalists assert a right to private property, some
   anarcho-capitalists also point out that common property can exist by
   right in an anarcho-capitalist system. Just as an individual comes to
   own that which was unowned by mixing his labor with it or using it
   regularly, many people can come to own a thing in commmon by mixing
   their labor with it collectively, meaning that no individual may
   appropriate it as his own. This may apply to roads, parks, rivers, and
   portions of oceans. Anarcho-capitalist theorist Roderick Long gives the
   following example:

          "Consider a village near a lake. It is common for the villagers
          to walk down to the lake to go fishing. In the early days of the
          community it's hard to get to the lake because of all the bushes
          and fallen branches in the way. But over time the way is cleared
          and a path forms - not through any coordinated efforts, but
          simply as a result of all the individuals walking by that way
          day after day. The cleared path is the product of labor - not
          any individual's labor, but all of them together. If one
          villager decided to take advantage of the now-created path by
          setting up a gate and charging tolls, he would be violating the
          collective property right that the villagers together have
          earned."

   Similarly, an established ocean route would be common property
   unavailable for private appropriation because it is in regular common
   use. Nevertheless, since property which is owned collectively tends to
   lose the level of accountibility found in individual ownership - or
   make such accountibility proportionately more complex,
   anarcho-capitalists generally distrust and seek to avoid such
   arrangements unless they arise unintentionally or are unavoidable as in
   the preceeding examples.

The contractual society

   A postage stamp celebrating the thousandth anniversary of the Icelandic
   parliament. According to a theory associated with the economist David
   Friedman, medieval Icelandic society had some features of
   anarcho-capitalism. Chieftaincies could be bought and sold, and were
   not geographical monopolies; individuals could voluntarily choose
   membership in any chieftain's clan.
   Enlarge
   A postage stamp celebrating the thousandth anniversary of the Icelandic
   parliament. According to a theory associated with the economist David
   Friedman, medieval Icelandic society had some features of
   anarcho-capitalism. Chieftaincies could be bought and sold, and were
   not geographical monopolies; individuals could voluntarily choose
   membership in any chieftain's clan.

   The society envisioned by anarcho-capitalists has been called the
   Contractual Society — "... a society based purely on voluntary action,
   entirely unhampered by violence or threats of violence." — in which
   anarcho-capitalists claim the system relies on voluntary agreements (
   contracts) between individuals as the legal framework. It is difficult
   to predict precisely what the particulars of this society will look
   like because of the details and complexities of contracts.

   One particular ramification is that transfer of property and services
   must be considered voluntary on the part of both parties. No external
   entities can force an individual to accept or deny a particular
   transaction. An employer might offer insurance and death benefits to
   same-sex couples; another might refuse to recognize any union outside
   his or her own faith. Individuals are free to enter into or reject
   contractual agreements as they see fit.

   One social structure that is not permissible under anarcho-capitalism
   is one that attempts to claim greater sovereignty than the individuals
   that form it. The state is a prime example, but another is the current
   incarnation of the corporation — defined as a legal entity that exists
   under a different legal code than individuals as a means to shelter the
   individuals who own and run the corporation from possible legal
   consequences of acts by the corporation. It is worth noting that
   Rothbard allows a narrower definition of a corporation: "Corporations
   are not at all monopolistic privileges; they are free associations of
   individuals pooling their capital. On the purely free market, such men
   would simply announce to their creditors that their liability is
   limited to the capital specifically invested in the corporation ...."
   However, this is a very narrow definition that only shelters owners
   from debt by creditors that specifically agree to the arrangement; it
   also does not shelter other liability, such as from malfeasance or
   other wrongdoing.

   There are limits to the right to contract under some interpretations of
   anarcho-capitalism. Rothbard himself asserts that the right to contract
   is based in inalienable human rights and therefore any contract that
   implicitly violates those rights can be voided at will, which would,
   for instance, prevent a person from permanently selling himself or
   herself into unindentured slavery. Other interpretations conclude that
   banning such contracts would in itself be an unacceptably invasive
   interference in the right to contract.

Law and order and the use of violence

   Different anarcho-capitalists propose different forms of
   anarcho-capitalism, and one area of disagreement is in the area of law.
   Morris and Linda Tannehill, in The Market for Liberty, object to any
   statutory law whatsoever. They assert that all one has to do is ask if
   one is aggressing against another (see tort and contract law) in order
   to decide if an act is right or wrong. However, Murray Rothbard, while
   also supporting a natural prohibition on force and fraud, supports a
   centralized libertarian legal code.

   Unlike both the Tannehills and Rothbard who see an ideological
   commonality of ethics and morality as a requirement, David Friedman
   proposes that "the systems of law will be produced for profit on the
   open market, just as books and bras are produced today. There could be
   competition among different brands of law, just as there is competition
   among different brands of cars." Friedman says whether this would lead
   to a libertarian society "remains to be proven." He says it is a
   possibility that very unlibertarian laws may result, such as laws
   against drugs. But, he thinks this would be rare. He reasons that "if
   the value of a law to it supporters is less than its cost to its
   victims, that law...will not survive in an anarcho-capitalist society."

   Anarcho-capitalists only accept collective defense of individual
   liberty (i.e., courts, military or police forces) insofar as such
   groups are formed and paid for on an explicitly voluntary basis.
   According to Molinari, "Under a regime of liberty, the natural
   organization of the security industry would not be different from that
   of other industries." Proponents point out that private systems of
   justice and defense already exist, naturally forming where the market
   is allowed to compensate for the failure of the state: private
   arbitration, security guards, neighbourhood watch groups, and so on.
   These private courts and police are sometimes referred to generically
   as Private Defense Agencies (PDAs.)

   The defense of those unable to pay for such protection might be
   financed by charitable organizations relying on voluntary donation
   rather than by state institutions relying on coercive taxation, or by
   cooperative self-help by groups of individuals.
   Many anarcho-capitalists admire the American Revolution and believe it
   is the only U.S. war that can be justified.
   Enlarge
   Many anarcho-capitalists admire the American Revolution and believe it
   is the only U.S. war that can be justified.

   Like classical liberalism, and unlike pacifism, anarcho-capitalism
   permits the use of force, as long as it is in the defense of persons or
   property. The permissible extent of this defensive use of force is an
   arguable point among anarcho-capitalists. Retributive justice, meaning
   retaliatory force, is often a component of the contracts imagined for
   an anarcho-capitalist society. Some believe prisons or indentured
   servitude would be justifiable institutions to deal with those who
   violate anarcho-capitalist property relations, while others believe
   exile or forced restitution are sufficient.

   One difficult application of defensive aggression is the act of
   revolutionary violence against tyrannical regimes. Many
   anarcho-capitalists admire the American Revolution as the legitimate
   act of individuals working together to fight against tyrannical
   restrictions of their liberties. In fact, according to Murray Rothbard,
   the American Revolutionary War was the only war involving the United
   States that could be justified;. Anarcho-capitalists, i.e. Samuel
   Edward Konkin III also feel that violent revolution is
   counter-productive and prefer voluntary forms of economic secession to
   the extent possible.

History and influences

Classical liberalism

   Gustave de Molinari (1819–1912).
   Enlarge
   Gustave de Molinari (1819–1912).

   Classical liberalism is the primary influence with the longest history
   on anarcho-capitalist theory. Classical liberals have had two main
   themes since John Locke first expounded the philosophy: the liberty of
   man, and limitations of state power. The liberty of man was expressed
   in terms of natural rights, while limiting the state was based (for
   Locke) on a consent theory.

   In the 19th century, classical liberals led the attack against statism.
   One notable was Frederic Bastiat (The Law), who wrote, "The state is
   the great fiction by which everybody seeks to live at the expense of
   everybody else." Henry David Thoreau wrote, "I heartily accept the
   motto, 'That government is best which governs least'; and I should like
   to see it acted up to more rapidly and systematically. Carried out, it
   finally amounts to this, which also I believe, 'That government is best
   which governs not at all'; and when men are prepared for it, that will
   be the kind of government which they will have."

   The early liberals believed that the state should confine its role to
   protecting individual liberty and property, and opposed all but the
   most minimal economic regulations. The "normative core" of classical
   liberalism is the idea that in an environment of laissez-faire, a
   spontaneous order of cooperation in exchanging goods and services
   emerges that satisfies human wants. Some individualists came to realize
   that the liberal state itself takes property forcefully through
   taxation in order to fund its protection services, and therefore they
   it seemed logically inconsistent to oppose theft while also supporting
   a tax-funded protector. So, they advocated what may be seen as
   classical liberalism taken to the extreme by only supporting
   voluntarily funded defense by competing private providers. One of the
   first liberals to discuss the possibility of privatizing protection of
   individual liberty and property was France's Jakob Mauvillon in the
   18th century. Later, in the 1840s, Julius Faucher and Gustave de
   Molinari advocated the same. Molinari, in his essay The Production of
   Security, argued, "No government should have the right to prevent
   another government from going into competition with it, or to require
   consumers of security to come exclusively to it for this commodity."
   Molinari and this new type of anti-state liberal grounded their
   reasoning on liberal ideals and classical economics. Historian and
   libertarian Ralph Raico asserts what that these liberal philosophers
   "had come up with was a form of individualist anarchism, or, as it
   would be called today, anarcho-capitalism or market anarchism." Unlike
   the liberalism of Locke, which saw the state as evolving from society,
   the anti-state liberals saw a fundamental conflict between the
   voluntary interactions of people — society — and the institutions of
   force — the State. This society versus state idea was expressed in
   various ways: natural society vs. artificial society, liberty vs.
   authority, society of contract vs. society of authority, and industrial
   society vs. militant society, just to name a few. The anti-state
   liberal tradition in Europe and the United States continued after
   Molinari in the early writings of Herbert Spencer, as well as in
   thinkers such as Paul Émile de Puydt and Auberon Herbert.

   Ulrike Heider, in discussing the "anarcho-capitalists family tree,"
   notes Max Stirner as the "founder of individualist anarchism" and
   "ancestor of laissez-faire liberalism." According to Heider, Stirner
   wants to "abolish not only the state but also society as an institution
   responsible for its members" and "derives his identity solely from
   property" with the question of property to be resolved by a 'war of all
   against all'." Stirner argued against the existence of the state in a
   fundamentally anti-collectivist way, to be replaced by a "Union of
   Egoists" but was not more explicit than that in his book The Ego and
   Its Own published in 1844.

   Later, in the early 20th century, the mantle of anti-state liberalism
   was taken by the " Old Right". These were minarchist, antiwar,
   anti-imperialist, and (later) anti- New Dealers. Some of the most
   notable members of the Old Right were Albert Jay Nock, Rose Wilder
   Lane, Isabel Paterson, Frank Chodorov, Garet Garrett, and H. L.
   Mencken. In the 1950s, the new "fusion conservatism", also called "cold
   war conservatism", took hold of the right wing in the U.S., stressing
   anti-communism. This induced the libertarian Old Right to split off
   from the right, and seek alliances with the (now left-wing) antiwar
   movement, and to start specifically libertarian organizations such as
   the (U.S.) Libertarian Party.

Nineteenth century individualist anarchism in the United States

   Lysander Spooner (1808–87).
   Enlarge
   Lysander Spooner (1808–87).

   Rothbard was influenced by the work of the 19th-century American
   individualist anarchists (who were also influenced by classical
   liberalism), and anarcho-capitalism is regarded as a form of
   individualist anarchism by many scholars. *. Rothbard said in 1965:
   "Lysander Spooner and Benjamin T. Tucker were unsurpassed as political
   philosophers and nothing is more needed today than a revival and
   development of the largely forgotten legacy they left to political
   philosophy." However, he thought they had a faulty understanding of
   economics. The 19th century individualists had a labor theory of value,
   as influenced by the classical economists, but Rothbard was a student
   of neoclassical economics which does not agree with the labor theory of
   value. So, Rothbard sought to meld 19th century individualists'
   advocacy of free markets and private defense with the principles of
   Austrian economics: "There is, in the body of thought known as
   'Austrian economics', a scientific explanation of the workings of the
   free market (and of the consequences of government intervention in that
   market) which individualist anarchists could easily incorporate into
   their political and social Weltanschauung". Rothbard held that the
   economic consequences of their political system they advocate would not
   result in an economy with people being paid in proportion to labor
   amounts, nor would profit and interest disappear as they expected.
   Tucker thought that unregulated banking and money issuance would cause
   increases in the money supply so that interest rates would drop to zero
   or near to it. Rothbard, disagreed with this, as he explains in The
   Spooner-Tucker Doctrine: An Economist's View. He says that first of all
   Tucker was wrong to think that that would cause the money supply to
   increase, because he says that the money supply in a free market would
   be self-regulating. If it were not, then inflation would occur, so it
   is not necessarily desirable to increase the money supply in the first
   place. Secondly, he says that Tucker is wrong to think that interest
   would disappear regardless, because people in general do not wish to
   lend their money to others without compensation so there is no reason
   why this would change just because banking was unregulated. Also,
   Tucker held a labor theory of value. As a result, he thought that in a
   free market that people would be paid in proportion to how much labor
   they exerted and that if they were not then exploitation or "usury" was
   taking place. As he explains in State Socialism and Anarchism, his
   theory was that unregulated banking would cause more money to be
   available and that this would allow proliferation of new businesses,
   which would in turn raise demand for labor. This led him to believe
   that the labor theory of value would be vindicated, and equal amounts
   of labor would receive equal pay. Again, as a neoclassical economist,
   Rothbard did not agree with the labor theory. He believed that prices
   of goods and services are proportional to marginal utility rather than
   to labor amounts in free market. And he did not think that there was
   anything exploitative about people receiving an income according to how
   much others subjectiely value their labor or what that labor produces,
   even if it means people laboring the same amount receive different
   incomes.

   Benjamin Tucker opposed vast concentrations of wealth, which he
   believed were made possible by government intervention and state
   protected monopolies. He believed the most dangerous state intervention
   was the requirement that individuals obtain charters in order to
   operate banks and what he believed to be the illegality of issuing
   private money, which he believed caused capital to concentrate in the
   hands of a privileged few which he called the "banking monopoly." He
   believed anyone should be able to engage in banking that wished,
   without requiring state permission, and issue private money. Though he
   was supporter of laissez-faire, late in life he said that State
   intervention had allowed some extreme concentrations of resources to
   such a degree that even if laissez-faire were instituted, it would be
   too late for competition to be able to release those resources (he gave
   Standard Oil as an example).. Anarcho-capitalists also oppose
   governmental restrictions on banking. They, like all Austrian
   economists, believe that monopoly can only come about through
   government intervention. Individualists anarchists have long argued
   that monopoly on credit and land interferes with the functioning of a
   free market economy. Although anarcho-capitalists disagree on the
   critical topics of profit, social egalitarianism, and the proper scope
   of private property, both schools of thought agree on other issues. Of
   particular importance to anarcho-capitalists and the individualists are
   the ideas of "sovereignty of the individual", a market economy, and the
   opposition to collectivism. A defining point that they agree on is that
   defense of liberty and property should be provided in the free market
   rather than by the State. Tucker said, "[D]efense is a service like any
   other service; that it is labor both useful and desired, and therefore
   an economic commodity subject to the law of supply and demand; that in
   a free market this commodity would be furnished at the cost of
   production; that, competition prevailing, patronage would go to those
   who furnished the best article at the lowest price; that the production
   and sale of this commodity are now monopolized by the State; and that
   the State, like almost all monopolists, charges exorbitant prices."
   But, again, since anarcho-capitalists disagree with Tucker's labor
   theory of value, they disagree that free market competition would cause
   protection (or anything else) to be provided "at cost." Like the
   individualists, anarcho-capitalists believe that land may be originally
   appropriated by, and only by, occupation or use; however, most
   individualists believe it must continually be in use to retain title.
   Lysander Spooner was an exception from those who believed in the
   "occupation and use" theory, and believed in full private property
   rights in land, like Rothbard.

The Austrian School

   The Austrian School of economics was founded with the publication of
   Carl Menger's 1871 book Principles of Economics. Members of this school
   approach economics as an a priori system like logic or mathematics,
   rather than as an empirical science like geology. It attempts to
   discover axioms of human action (called " praxeology" in the Austrian
   tradition) and make deductions therefrom. Some of these praxeological
   axioms are:

          + humans act purposefully;
          + humans prefer more of a good to less;
          + humans prefer to receive a good sooner rather than later; and
          + each party to a trade benefits ex ante.

   Even in the early days, Austrian economics was used as a theoretical
   weapon against socialism and statist socialist policy. Eugen von
   Böhm-Bawerk, a colleague of Menger, wrote one of the first critiques of
   socialism ever written in his treatise The Exploitation Theory of
   Socialism-Communism. Later, Friedrich Hayek wrote The Road to Serfdom,
   asserting that a command economy destroys the information function of
   prices, and that authority over the economy leads to totalitarianism.
   Another very influential Austrian economist was Ludwig von Mises,
   author of the praxeological work Human Action.

   Murray Rothbard, a student of Mises, is the man who attempted to meld
   Austrian economics with classical liberalism and individualist
   anarchism, and is credited with coining the term "anarcho-capitalism".
   He wrote his first paper advocating "private property anarchism" in
   1949, and later came up with the alternative name "anarcho-capitalism."
   He was probably the first to use "libertarian" in its current (U.S.)
   pro-capitalist sense. He was a trained economist, but also
   knowledgeable in history and political philosophy. When young, he
   considered himself part of the Old Right, an anti-statist and anti-
   interventionist branch of the U.S. Republican party. When
   interventionist cold warriors of the National Review, such as William
   Buckley, gained influence in the Republican party in the 1950s,
   Rothbard quit that group and formed an alliance with left-wing antiwar
   groups, noting an antiwar tradition among a number of self-styled
   left-wingers and to a degree closer to the Old Right conservatives. He
   believed that the cold warriors were more indebted in theory to the
   left and imperialist progressives, especially in regards to Trotskyist
   theory.". Later, Rothbard was a founder of the U.S. Libertarian Party.
   In the late 1950s, Rothbard was briefly involved with Ayn Rand's
   Objectivism, but later had a falling out. Rothbard's books, such as
   Man, Economy, and State, Power and Market, The Ethics of Liberty, and
   For a New Liberty, are considered by some to be classics of natural law
   libertarian thought.

Real world examples similar to anarcho-capitalism

   19th century interpretation of the Althing in the Icelandic
   Commonwealth, which authors such as David Friedman and Roderick Long
   believe to have some features of anarcho-capitalist society.
   Enlarge
   19th century interpretation of the Althing in the Icelandic
   Commonwealth, which authors such as David Friedman and Roderick Long
   believe to have some features of anarcho-capitalist society.

   To the extent that anarcho-capitalism is thought of as a theory or
   ideology - rather than a civilizing process - critics say that it is
   unlikely ever to be more than a utopian ideal. Some, however, point to
   actual situations where protection of individual liberty and property
   has been voluntarily-funded rather than being provided by a state
   through taxation.

Medieval Iceland

   According to David Friedman, " Medieval Icelandic institutions have
   several peculiar and interesting characteristics; they might almost
   have been invented by a mad economist to test the lengths to which
   market systems could supplant government in its most fundamental
   functions." While not directly labeling it anarcho-capitalist, he
   argues that the Icelandic Commonwealth between 930 and 1262 had "some
   features" of an anarcho-capitalist society — while there was a single
   legal system, enforcement of law was entirely private and highly
   capitalist; and so provides some evidence of how such a society would
   function. "Even where the Icelandic legal system recognized an
   essentially "public" offense, it dealt with it by giving some
   individual (in some cases chosen by lot from those affected) the right
   to pursue the case and collect the resulting fine, thus fitting it into
   an essentially private system."

The American Old West

   According to the research of Terry L. Anderson and P. J. Hill, the Old
   West in the United States in the period of 1830 to 1900 was similar to
   anarcho-capitalism in that "private agencies provided the necessary
   basis for an orderly society in which property was protected and
   conflicts were resolved," and that the common popular perception that
   the Old West was chaotic with little respect for property rights is
   incorrect.

Conflicts within anarcho-capitalist theory

   The only significant dispute within the anarcho-capitalist movement
   concerns whether an anarcho-capitalist society is based on
   deontological or consequentialist grounds. Natural-law
   anarcho-capitalism (such as that advocated by Rothbard) holds that a
   universal system of rights can be determined through natural law.
   Consequentialists such as Friedman disagree, maintaining that rights
   are merely human constructs that rational humans create through
   contracts and individual relationships, resulting in the system that
   leads to the best consequences for all parties.

   In The Machinery of Freedom, Friedman describes an economic approach to
   anarcho-capitalist legal systems. His description differs with
   Rothbard's because it does not use moral arguments — i.e., it does not
   appeal to a theory of natural rights to justify itself. In Friedman's
   work, the economic argument is sufficient to derive the principles of
   anarcho-capitalism. Private defense or protection agencies and courts
   not only defend legal rights but supply the actual content of these
   rights and all claims on the market. People will have the law system
   they pay for, and because of economic efficiency considerations
   resulting from individuals' utility functions, such law will tend to be
   libertarian in nature but will differ from place to place and from
   agency to agency depending on the tastes of the people who buy the law.
   Also unlike other anarcho-capitalists, most notably Rothbard, Friedman
   has never tried to deny the theoretical cogency of the neoclassical
   literature on "market failure," nor has he been inclined to attack
   economic efficiency as a normative benchmark.

Criticisms of anarcho-capitalism

   Criticisms of anarcho-capitalism fall into several categories:
   practical criticisms which claim that anarcho-capitalism is unworkable
   in practice; critiques that claim that capitalism requires a coercive
   state to exist and that a society can be anarchist or capitalist, but
   not both; general critiques of the morality of capitalism and
   liberalism, which also apply to anarcho-capitalism; and a utilitarian
   critique, which claims that anarcho-capitalism would not maximize
   utility.

   Objectivists argue that, in the absence of a state, an
   anarcho-capitalist society would degenerate into a "war of all against
   all". Other critics argue that the free rider problem makes the
   provision of protection services in an anarcho-capitalist society
   impractical.

That anarcho-capitalism is not a legitimate form of anarchism

          These arguments are also discussed in the Anarchism and
          anarcho-capitalism article.

   Although several scholars see anarcho-capitalism as a form of
   anarchism, many anarchists strongly argue that anarcho-capitalism is
   not a form of anarchism, since they believe capitalism to be inherently
   authoritarian. In particular, many anarchists and socialists argue that
   certain capitalist transactions are not voluntary, and that maintaining
   the capitalist character of a society requires coercion, which is
   incompatible with an anarchist society. Moreover, capitalistic market
   activity is essentially dependent on the imposititon of private
   ownership and a particular form of exchange of goods where selling and
   buying is usually mandatory (due to the division of ownership of the
   capital, and consequently, value).

   According to The Anarchist International, for example, capitalism is an
   economic plutocracy that includes its own hierarchy. They place
   anarcho-capitalism outside of the anarchist movement and into the
   classical liberal tradition: " Plutarchy without statism = liberalism."
   American individualist anarchism is sometimes regarded as a form of
   "liberal-anarchism."

Anarcho-capitalist literature

Nonfiction

   The following is a partial list of notable nonfiction works discussing
   anarcho-capitalism.
     * Murray Rothbard Father of modern anarcho-capitalism:
          + Man, Economy, and State The ultimate Austrian economics book,
          + Power and Market Classification of State economic
            interventions,
          + The Ethics of Liberty Moral justification of a free society
     * Frederic Bastiat, The Law Radical classical liberalism
     * Davidson & Rees-Mogg, The Sovereign Individual Historians look at
       technology & implications
     * David D. Friedman, The Machinery of Freedom Classic
       consequentialist defense of anarchism
     * Auberon Herbert, The Right and Wrong of Compulsion by the State
     * Albert Jay Nock, Our Enemy the State Oppenheimer's thesis applied
       to early US history
     * Juan Lutero Madrigal, anarcho-capitalism: principles of
       civilization
     * Franz Oppenheimer, The State Analysis of State; political means vs.
       economic means
     * Robert Nozick, Anarchy, State, and Utopia Academic philosopher on
       libertarianism
     * Herbert Spencer, Social Statics Includes the essay "The Right to
       Ignore the State"
     * Morris & Linda Tannahill, The Market for Liberty Classic on PDAs
       (private defense agencies)

Fiction

   Anarcho-capitalism has been examined in certain works of literature,
   particularly science fiction. an example being Robert A. Heinlein's
   1966 novel The Moon Is a Harsh Mistress, where he explores what he
   terms "rational anarchism". It is particularly influential in the work
   of cyberpunk and post-cyberpunk authors. Several stories of Vernor
   Vinge, including Marooned in Realtime, are set in an effectively
   anarcho-capitalist future, as are Neal Stephenson's Snow Crash, Max
   Barry's Jennifer Government, and Cory Doctorow's Down and Out in the
   Magic Kingdom. It should be noted that many of these works are highly
   critical of anarcho-capitalism. Authors such as Neal Stephenson and Max
   Barry use the literary genre of Science Fiction to critique the
   ideology arguing that anarcho-capitalism leads to a greater degree of
   tyranny, not a decrease.

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