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March 23rd, 2004

I’ve been reading the Aubrey-Maturin books by Patrick O’Brian and was struck by an episode in Post Captain . The hero, Jack Aubrey has been given command of a ship but is being pursued by his creditors and faces indefinite imprisonment for debt if they catch him. Reaching Portsmouth and his crew, he turns on the bailiffs who have been pursuing him and routs them. Several are knocked down and, in a marvellous twist, Aubrey presses them into service on his ship.

It struck me on reading O’Brian that this kind of thing would happen routinely in a libertarian Nozickian utopia. On the one hand, bankruptcy and limited liability, the first great pieces of government interference with freedom of contract would be abolished, and imprisonment for debt presumably reintroduced. On the other hand, since Nozick envisages a minimal state with no real taxing powers but a continuing responsibility for defence, reliance on conscription would be almost inevitable. From Nozick’s viewpoint, any form of taxation constitutes slavery, and fairness is not a proper concern of policy, so there can be no particular objection to the press gang as opposed to, say, voluntary recruitment financed by involuntary income taxes.

Also, at the weekend, I went to watch the final day of the Australian Surf Life Saving Championships. Apart from a brief stint in Sydney, I’ve never lived close enough to a surf beach to watch this archetypally Australian sport. Very exciting, though you need a big screen to see what’s happening in the middle stages of the race, particularly in the swim legs.

Update 26/3Libertarians come in many different flavours, and quite a few have objected to the characterization above. To my mind, the combination of “libertarian’ and “utopia” leads irresistibly to Robert Nozick’s Anarchy, State and Utopia. For clarity, therefore, I’ve referred specifically to Nozick rather than to libertarians in general.

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  1. Mark
    March 23rd, 2004 at 16:10 | #1

    I have always been surprised that one of the arguments against the military draft that has not been used is that it forms a kind governmental enslavement. Sure you’re paid and sure, everyone gets drafted, but you have no choice. Not much different from being an African a few miles inland from the west coast of that continent a few hundred years ago.

  2. March 23rd, 2004 at 17:10 | #2

    Pr Q misrepresents the libertarian position on compulsory military service:

    since most libertarians envisage a minimal state with no real taxing powers but a continuing responsibility for defence, reliance on conscription would be almost inevitable…From the libertarian viewpoint, any form of taxation constitutes slavery, and fairness is not a proper concern of policy, so there can be no particular objection to the press gang as opposed to, say, voluntary recruitment financed by involuntary income taxes.

    Nozick, like most moral libertarians, puts taxation on a par with forced labour, but not identical to it. In general, libertarians consider actual forced labour as much worse than taxation, since the latter may always be avoided by the simple expedient of not working ie Rand’s Men of Mind going on strike.
    Actual, existing libertarians (and libertarian societies) strongly object to forced labour for military purposes. Hence they oppose the military draft, both in principle eg Ayn Rand, and in practice, eg Milton Friedman.
    Libertarians have consistently supported a voluntary military service, the funds for which may be raised by democratic taxation (utilitarians) or capitalist subscription (proprietarians).

  3. March 23rd, 2004 at 17:21 | #3

    John, your representation of a libertarian world is quite poor. First (and I’m amazed I have to point this out) libertarians have been, are, and will remain some of the most outspoken opponents of the draft.

    Second, while many libertarians point out that tax = theft, that does not imply that it should not be done. A significant number of libertarians (most I know) are utilitarians and, while they believe that tax is wrong, all things being equal – they also realise that all things are not equal. I believe tax is theft by any useable definitions of both words (I think that’s obvious), but I would accept the imposition of tax if and when you can show that doing so brings demonstrable utility benefits. Indeed, nearly all libertarians support tax to pay for the defence force on this very ground.

    As for the slavery analogy, that is more often put as: our relationship to the government is similar to the relationship of a slave to a master. The point (often not well put) is that the government’s relationship to us is, by definition, based on violence and coercion. Again, for any consequentialist, this does not prove it should not exist. Instead, these arguments are used to show were the burden of proof should lie (ie with the proponents of government action).

    As for “fairness is not a propoer concern of policy” – that is a shocking sentence, and I’ll do you the service of assuming it’s based on ignorance. First, I presume you assume that “fair” means something like equality. It’s quite reasonable to take a deontelogical definition of fairness (ie, fairness is determined in the action, not the outcome). Second, even if you take a consequentialist definition of fair (and it’s more difficult than most people imagine) then it is not necessarily true that libertarians don’t consider it. It is simply true that they believe, on the whole, that the government doesn’t actually achieve it.

    Finally – to your original point – to me the most obvious free-market solution to debt is that the person in debt agrees to pay off the debt over time. Paying a percentage of their income maybe? If somebody owed me money, I would prefer this outcome than sending them to jail and getting no money.

    I don’t mind explaining libertarianism to people, but prefer it when they at least advertise their ignorance in the form of honest questions or open challenges.

  4. Tom Davies
    March 23rd, 2004 at 19:27 | #4

    I don’t understand why you think libertarians would favour debtor’s prisons — surely default provisions would be part of contracts, and locking up the defaulter hardly seems in the creditors favour? And why does limited liability need legislation — isn’t it just a matter of what security is offered as part of a contract? I understand that limited liability could be actively abolished, but why would libertarians do that?

  5. John Quiggin
    March 25th, 2004 at 21:47 | #5

    As was pointed out in the Crooked Timber comments thread, locking debtors up isn’t as silly as it sounds. It may induce them to reveal hidden stores of cash or friends and family may bail them out. So if debtors prison were available, creditors would use it. Despite this, I think it’s pretty clear that bankruptcy is socially more efficient, but it’s certainly an infringement of freedom of contract, since it can’t be contracted around. Things are less clear with limited liability which can be seen as a legislated change in the default contract.

    As regards libertarians and the draft, the point Jack makes about Nozick is the critical one. If you regard taxation as being on a par with forced labour, but you still need to raise some revenue, you don’t have any reason, in principle, not to use forced labour as the means to raise it. There may be efficiency arguments for monetary taxes in many cases, but the example of the press gang suggests these will not always be conclusive.

    This point doesn’t apply to all libertarians, so I shouldn’t have written as if it did. If you object to both conscription and taxes, but say that conscription is categorically worse, then my argument doesn’t apply. But it does catch both Nozick and Craig Roberts.

  6. March 26th, 2004 at 10:34 | #6

    I was not trying to deny that some debters may end up in prison if bankruptcy was removed – though I doubt it would be the rule. As for whether the threat of prison lead to a more or less efficient outcome – I don’t see how the answer is ‘pretty clear’.

    Using Nozick as your only libertarian guide might not be the best way of understading the philosophy. Especially as an economist, it is not hard to come across the many good utilitarian libertarian thinkers. Even on the blogosphere.

    I should add that “rights-based” objectivists and anarchists would also find your critique of Nozick unconvincing as they disagree with Nozick on certain issues. In the end, your target is a pretty small sub-set of libertarians.

  7. March 26th, 2004 at 15:47 | #7

    The other replies have brought out most of what JQ needed to be told about his misunderstanding of libertarian points. I might have added a few references to people like Heinlein who do object to conscription as making slave soldiers, but I couldn’t be sure of the reference (I think it was in “Starship Troopers”). Also, one doesn’t have to adopt a libertarian ideology and systematise their suggested solutions to recognise the force of their criticisms.

    So that only leaves JQ’s latest scrambling to criticise, and some historical aspects to bring out.

    JQ is wrong in thinking that if you recognise that governments need money, you don’t have any in principle reason not to use forced labour. For one thing, the need for defence does not imply a need for money – nothing says that governments need supply these services rather than arrange that they exist, in this area more than any other. Indeed the whole idea of the early USA was that defence should be provided by militia formations, not controlled centrally (and the mediaeval approach was even more like this). The element of compulsion in such things as the USA’s “muster day” did not relate to making people serve, but to ensure their readiness – and once ready, they were in a position to refuse pressure. The Swiss example shows us that conscription – which they are doing from this training perspective – can be enforced mainly through civil disabilities; “if you don’t want us then we don’t want you”, which is consistent with a libertarian ethos. It is easy to distinguish that from enslaving, and we have models of private education to show us that the state need not even be involved at that level.

    But let’s look at the money, stipulating that governments need it. On the one hand, taxes are not the only way for governments to raise money (rents, resource sales and investments have different moral significance from taxes), and on the other hand, even when there are taxes you can have their point of impact on non-citizens. That avoids any moral significance in terms of the people the government should be looking out for – it’s a cop out, by not counting foreigners, but it’s a consistent approach. During the part of the 19th century when there were no emergencies the US central government got nearly all its revenues in one of these ways – from land grants or from tariffs. Sure, there is no great economic significance in doing these things instead of taxes, and they are not sustainable if the capital releases are used for current expenditure instead of going into diversifying a revenue yielding portfolio, but we were looking at what hit people. The moral argument against taxes and against forced labour is, that you are violating “first do no harm”.

    Here are some historical things. Until the 20th century a much larger proportion of government revenues were obtained from the yield of “domains” rather than taxes, indeed practically all in early mediaeval times. One slogan of the Civil War period was that “the King should live off his own”, i.e. his rent rolls rather than a tax vote.

    In that era one significance of parliamentary voting on taxes was that there was a vicious circle for the government: without force or parliamentary consent (as a proxy for the rest of us) they couldn’t levy taxes, but without money they couldn’t afford the force to skip the consent – so consent was necessary, and parliaments carefully never allowed monarchs to get clear of the bind (there were army and navy votes in the UK into the 1960s). Unfortunately our modern parliaments have been captured by the government spirit and are no longer on our side, and efficiencies mean that our active consent is no longer necessary anyway; our actual guarantees have gone, and we are dependent on the goodwill of those who might reinterpret our best interests their own way. Money votes are now mere ritual, not corresponding to any actual balance of forces.

    In 1688 James II tried to get ahead of the game, using Irish volunteers to build up armed forces outside London, but a once bitten twice shy group of statesmen headed off the risk by bringing on the Glorious Revolution. They wanted to avoid the King’s encroachment without the violence they knew from experience was counter-productive. This set the pattern for that monetary constraint on force. What it mostly shows us, though, is that there is another level of threat. British objections to conscription were actually at the higher level, to having powerful forces in being. Press gangs produced ships, which weren’t that sort of threat – the individual loss of freedom did not risk the capture of the state. On the other hand a large volunteer army on Blackheath was no threat to individual freedom in itself but did threaten capturing the state. British objections were at the constitutional level; but even though libertarians stress threats to individual freedom, they are also worried about the James II sort of threat, that the whole country might fall (since that leads to threats to individuals, now that we have too much efficiency to have the Austrian solution of “tyranny redeemed by inefficiency”).

  8. Tom Davies
    March 27th, 2004 at 00:13 | #8

    I can’t find my copy of Starship Troopers, but at http://www.kentaurus.com/troopers.htm I found this:
    “Heinlein was against conscription, as he stated in the Guest of Honor speech at the XIXth World Science Fiction Convention:

    I also think there are prices too high to pay to save the United States. Conscription is one of them. Conscription is slavery, and I don’t think that any people or nation has a right to save itself at the price of slavery for anyone, no matter what name it is called. We have had the draft for twenty years now; I think this is shameful. If a country can’t save itself through the volunteer service of its own free people, then I say: Let the damned thing go down the drain! [Heinlein 1961:245]“

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