Author: D. G. White
Date: 2009-01-01T07:00:00+00:00
Keywords: state; money
Description: Stephan Kinsella lp-1-32 Mac OS X 10.5.8 Quartz PDFContext
Rights: Licensed under Creative Commons Attribution 3.0. https://creativecommons.org/licenses/by/3.0/

LIBERTARIAN PAPERS VOL. 1, ART. NO. 32 (2009)

GOLD, THE GOLDEN RULE, AND GOVERNMENT: CIVIL SOCIETY AND THE END OF THE STATE

D. * G. W HITE

Gold is the child of Zeus.

—Pindar, circa 500 BCE

What you do not want done to yourself, do not do to others.

—Confucius, circa 500 BCE

I heartily accept the motto, “That government is best which governs least.”…

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.

—Henry David Thoreau, 1849 CE

1. The Twin Pillars of Civilization

WITHOUT MONEY, there can be little in the way of economic specialization, or what is commonly known as the division of labor. And without the division of labor, there can be little in the way of civilization. In pre-agricultural hunter-gatherer society, labor is primarily limited to these two endeavors, the hunting generally done by men and the gathering by women.1 So, too, is labor limited in early agricultural society, the men generally doing the farming and women the domestic work.2 And while proto-money3 might

* D. G. White (white12349@gmail.com) is an eco-industrial entrepreneur who lives, works, and writes in the American southeast.

CITE THIS ARTICLE AS: D.G. White, “Gold, the Golden Rule, and Government: Civil Society and the End of the State,” Libertarian Papers 1, 32 (2009). ONLINE AT: libertarianpapers.org. THIS ARTICLE IS subject to a Creative Commons Attribution 3.0 License (creativecommons.org/licenses).

1 See Wikipedia, “Hunter-gatherer / Social and economic structure” here: en.wikipedia.org/wiki/Hunter-gatherer#Social_and_economic_structure.

2 See “Early Agricultural Societies” at WebChron Glossary of Historical Terms here: www.thenagain.info/WebChron/glossary/EarlyAg.N.html.

3 See Wikipedia, “History of money / The emergence of money” here:

1

be involved, economic exchange is generally limited to barter, which requires a coincidence of wants that is far too inelastic to allow for the manifold exchange of goods and services that is the lifeblood of civil society.

Money, in other words, is essential to any society that we would call civil, prompting us to ask what, in fact, money is and how it comes to be. The answer, simply enough, is that money becomes what it is through the very same process of exchange upon which civil society depends: If one good is more marketable than another—if everyone is confident that it will be more readily sold—then it will come into greater demand because it will be used as a medium of exchange. It will be the medium through which one specialist can exchange his product for the goods of other specialists.

Now just as in nature there is a great variety of skills and resources, so there is a variety in the marketability of goods. Some goods are more widely demanded than others, some are more divisible into smaller units without loss of value, some more durable over long periods of time, some more transportable over large distances. All of these advantages make for greater marketability. It is clear that in every society, the most marketable goods will be gradually selected as the media for exchange. As they are more and more selected as media, the demand for them increases because of this use, and so they become even more marketable. The result is a reinforcing spiral: more marketability causes wider use as a medium, which causes more marketability, etc. Eventually one or two commodities are used as general media—in almost all exchanges—and these are called money.4

Money, then, is simply a commodity that, as an inherent store of value, is used as a conduit for exchange. And given its considerable attributes—e.g., beauty, density, indestructibility, malleability, homogeneity, divisibility, transportability—it is little wonder that, over time, gold became the commodity of choice, the preeminent medium of exchange the world over. Nor is it any wonder that with the subsequent emergence of banknotes and other money substitutes, which greatly facilitated indirect exchange and therefore the division of labor, it was gold that usually backed them up.

Gold, then, is a good that is especially good as the money upon which civil society depends—so good, in fact, that if something is said to be “as good as gold,” it is receiving what is understood to be the highest possible praise, just as that which is described as “golden”—a golden moment, for en.wikipedia.org/wiki/History_of_money#The_emergence_of_money.

4 Murray N. Rothbard, What Has Government Done to Our Money?, Praxeology Press, 1963, p. 18.

example—is understood to be “of the greatest value or importance.” And thus does it come as no surprise that the ethic of reciprocity, all but unknown in this terminology, has been accepted the world over as the golden rule: The nearly universal acceptance of the golden rule and its promulgation by persons of considerable intelligence, though otherwise of divergent outlooks, would seem to provide some evidence for the claim that it is a fundamental ethical truth.5

The preeminent moral precept of virtually every major religion and culture in human history, the golden rule is indeed a fundamental ethical truth that is as precious to civil society as the metal itself is deemed to be. Thus, it is not too much to say that as gold has historically been the foremost currency of commerce, the golden rule has been the foremost currency of morals, the ethic that civil society has always “banked on” in one form or another. Nor is it too much to say, then, that together, gold and the golden rule form the twin pillars of civilization—i.e., the means by which individuals have traditionally cooperated to improve their lot in life, there being no other reason for civil society to exist: The idea that anybody would have fared better under an asocial state of mankind and is wronged by the very existence of society is absurd. Thanks to the higher productivity of social cooperation, the human species has multiplied far beyond the margin of subsistence.6

Indeed it has. And if left to its own devices—i.e., if its members are allowed to interact freely and of their own accord—the human species will use its commodity money and its universal morality to continually improve its overall wellbeing.

But let us pause and ask, why freedom? What is so important about freedom, and why is it so vital to the advance of civil society?

2. The Metaphysics of Freedom

Freedom is nothing else but a chance to be better. —Albert Camus

What individuals fundamentally seek is order, by which we do not mean regimentation but harmony—i.e., “a pleasing combination of the elements in a whole,”7 wherein the whole is the wholeness of one’s life. And because such

5 Marcus G. Singer, The Encyclopedia of Philosophy, MacMillan Publishing, 1967, p. 366.

6 Ludwig von Mises, Human Action: A Treatise on Economics, Henry Regnery Company, 1966 (1949), Third Revised Edition, Contemporary Books, p. 165.

7 See definition two at Answers.com here: www.answers.com/topic/harmony. 4 LIBERTARIAN PAPERS 1, 32 (2009)

order is virtually impossible to attain in isolation (even hermetic monks live in a society of shared belief, without which their mode of existence would be devoid of meaning), individuals socialize for this reason, and naturally so. For insofar as there is order in nature (and of course there is astounding order), freedom—which is inherent, for instance, in the random variation that is integral to the evolutionary process—is the cause, not the effect, of it. So too, then, is freedom in the human realm “the mother, not the daughter, of order,”8 it being but the conscious application of its counterpart in the natural realm. And thus is freedom the sine qua non of human civilization—the foundation upon which its twin pillars stand—without which the order that its individual members yearn for cannot be generally attained or continually increased.

But not just any freedom. For while freedom is indispensable to the social enterprise, complete freedom is destructive of it, resulting not in order but in chaos, as each does whatever he wants, regardless of what others may or may not want. “Anything goes,” in other words, and thus does libertinism render civil society null and void amid a literal free-for-all of untempered action.

Moreover, while we accept the determinism whereby “man is free as long as his own will is one of the steps in the causal chain,”9 we reject the determinism whereby “every event in the future is fated to happen,”10 as this too results in chaos. For if our actions are purely a matter of fate—if we have no choice in what we do—then we have no responsibility for what we do. And if we have no responsibility for what we do, then there can be no moral content in our actions. As with libertinism, then, so with fatalism, as there is no right or wrong in either case. Once again, “anything goes” for the simple reason that “everything was already going to be.” And thus does “the chance to be better” have literally no chance, there being no standard by which to gauge it. Better than what, after all? Better than bad? But there is no bad, just as there is no good.

Thus do the extremes of freedom and determinism result in meaninglessness, which is to say, in absurdity. And to avoid it, we reject both libertinism and fatalism by accepting—by embracing—the fact that while freedom is a metaphysical reality, it can have no meaning in the human realm without restraints being placed upon it, the task for society being to

8 Pierre-Joseph Proudhon; see “Remembering Proudhon” at Polycentric Order here: polycentricorder.blogspot.com/2009/01/remembering-proudhon.html.

9 See The Information Philosopher here: www.informationphilosopher.com/freedom/determinism.html.

10 See preceding footnote.

determine what the minimum restraints are, that it might maximize the opportunity for its individual members to improve their lot in life. To generate more order. To be better.

3. The Natural Law of Civil Society

The best interpreter of the law is custom. —Marcus Tullius Cicero

Individuals do not always, if ever, exercise their freedoms so as to promote the order in everyone’s lives. On the contrary, in promoting the order in their own lives, individuals tend to impinge upon the lives of at least some others, if only because, in their efforts to cooperate with one party— i.e., to exchange one or another good or service to their mutual benefit—they inadvertently compete with another party, in which case one or the other must accordingly lose. But insofar as this process of exchange promotes the division of labor, resulting in the provision of a wider variety of goods and services that in turn improves the overall quality of life, the gains far exceed the losses.11 For how else could the human species have advanced at all, much less to a stage that was inconceivable little more than a century, or even mere decades, ago? How else could it have harnessed electricity, for example—or invented the locomotive, the telegraph, the telephone, the automobile, the airplane, the computer, the cell phone, email, the Internet, etc.—if not but through this cooperative, if inevitably competitive, process?

When individuals eschew cooperation, however, and instead aggress against one another in order to improve their lot in life—i.e., when they initiate the use of force—then the social enterprise is thereby thwarted, prompting society to develop the means to minimize aggression, to adjudicate the disputes that arise as a result thereof, and to provide restitution for those aggressed against in such a way that society as a whole is preserved. Society develops a system of law, in other words, and traditionally this system has been known as customary or common law—i.e., law that is “developed

11 Yes, competition can be so intense that one business—a coffee shop, say—puts a similar enterprise out of business. But as long as the former did not aggress against the latter—i.e., it did not lie, cheat, steal, or otherwise aggress against it—this is simply business as usual. And importantly, this includes the “creative destruction” (see Wikipedia entry here: en.wikipedia.org/wiki/Creative_destruction), whereby a new technology—say, the “horseless carriage”—is introduced, and manufacturers of the old technology are put out of business for lack of customers. As such, this too is simply business as usual, as the destruction of whole industries is more than offset by the introduction of new ones, the survival of which is dependent on how well their members (e.g., automakers) meet the demands of their customers.

through decisions of courts and similar tribunals … rather than through legislative statutes or executive action.”12 And of fundamental importance in the development of such law is that it is based on reciprocity: Reciprocities are the basic source both of the recognition of duty to obey law and of law enforcement in a customary law system. That is, individuals must “exchange” recognition of certain behavioral rules for their mutual benefit.13

In noting that such exchange is fundamental to both money and law, it should be no surprise, then, that

… the origin, formation, and ultimate process of all social institutions … is essentially the same as the spontaneous order Adam Smith described for markets. Markets coordinate interactions, as does customary law. Both develop as they do because the actions they are intended to coordinate are performed more effectively under one system or process than another. The more effective institutional arrangement replaces the less effective one.14

Like customary money, in other words, customary law evolves over time, as the members of society come to agreement through a process of trial and error to determine which laws best promote their mutual wellbeing. As such, legal reciprocity is part of a seamless process of cooperative interaction that is “marketable” precisely as monetary reciprocity is. For both are products of the spontaneous order—i.e., of “the emergence of various kinds of social order from a combination of self-interested individuals”15—that naturally arises from such reciprocation. Thus is law natural to man, and thus do customary money and customary law form the core of man’s morality, as each arises through the application of the ethic of reciprocity.

As the application can vary, however, from proper to perverse—i.e., from logical restraint to pathological intervention—let us examine the implications thereof.

12 See Wikipedia entry here: en.wikipedia.org/wiki/Common_law.

13 Bruce L. Benson, The Enterprise of Law, Pacific Research Institute for Public Policy, 1990, p. 12.

14 Ibid., p. 15.

15 See Wikipedia, “Spontaneous order,” here: en.wikipedia.org/wiki/Spontaneous_order.

4. Negative Rule, Positive Rule, and Positivist Rule

Law is a negative concept. —Frederic Bastiat

As an element of nature, gold is what it is, no matter what form. The same cannot be said of the golden rule, however, for no matter how natural the social process out of which it evolved, the golden rule is a human construct and therefore its existence “in one form or another” can be decidedly different from the forms of its elemental namesake.

In the first place, it is one thing to say, with Confucius, “What you do not want done to yourself, do not do to others” and quite another to say, “What you want done to yourself, do to others” (or as many of us were taught, “Do unto others as you would have them do unto you”). For although both are reciprocal, the first rule merely requires restraint, while the second requires intervention. That is, the first says that if John doesn’t want Joe to hit him, then John must refrain from hitting Joe, while the second says that if John wants Joe to feed him, then John must feed Joe.

Moreover, the inversion of the golden rule goes even further, transmuting the authority of the interventionist rule so as to say, in effect, “Do unto others what they would have you do unto them.” Now, John is not merely obligated to intervene on Joe’s behalf and Joe on John’s. Instead, John is obligated to do whatever Joe wants, and Joe is obligated to do whatever John wants, making each the servant of the other.

As religions have differed in this regard, we note, for example, that Judaism holds to the negative rule, saying, “What is hateful to you, do not to your fellow men,” adding an emphatic, “That is the entire Law; all the rest is commentary.”16 Christianity, on the other hand, adopts the positive rule, saying, “Whatever you wish that men would do to you, do so to them,”17 and (with the symbolic washing of feet, for instance) goes so far as to invert the rule into a one of mutual subservience.

Insofar as positive rule, including its inversion, is adopted on a purely voluntary basis, it is perfectly acceptable in society. When positive rule is commanded, however, then insofar as that society would be free, it is not, and therefore insofar as that society would be civil, it is not. For whenever individuals—beyond the restraints of the negative golden rule—are prevented from acting freely and of their own accord, but are instead forced

16 Babylonian Talmud: Tractate Shabbath, Folio 31, online version here: www.come-and-hear.com/shabbath/shabbath_31.html 17 John 13:3-14 and, in the same vein, Mathew 5:39-42.

to obey this or that positive rule, they are being required to do unto others what they might not want to do and/or be done unto as they might not want to be done.

To one degree or another, then, involuntary servitude must be the inevitable result of this form of positive rule. And as involuntary servitude is the very definition of slavery, it follows that the members of such a society are accordingly enslaved, the corruption of the positive golden rule arising from “the substitution of coercion for voluntary actions.”18 To such corruption we therefore give the name positivism, this being the already established term as it relates to the so-called severability thesis, which posits that law is not derived from morality, asserting on the contrary that “law and morality are conceptually distinct.” 19

Furthermore, we use the term positivism regardless of whether it manifests itself on a religious or a secular basis. Thus is Marxist positivism— ”From each according to his ability, to each according to his need”20—no different from the positivism of Christian theocracies of the past or Muslim theocracies of the present. And while it might be assumed that today’s presumably democratic societies are not positivistic, it will be seen upon examination that they are—and thoroughly so.

5. Money and the State

It is well enough that people of the nation do not understand our banking and monetary system, for if they did, I believe there would be a revolution before tomorrow morning.

—Henry Ford

Once the domain of society—i.e., of the cooperative interaction that is its natural mode of economic organization and integration—the control of money has been usurped by the state and accordingly monopolized. Moreover, the monopolization is now a fait accompli due the state’s abandonment of gold, or any other commodity, as the monetary standard. Money has been positivized, in other words, in that it is now created not by

18 Rothbard, Man, Economy, and State, 1962, copyright 2004 by the Ludwig von Mises InstituteThe Mises, Chapter 11, “Money and Its Purchasing Power,” p. 766, online Scholar’s edition here: mises.org/rothbard/mes.asp 19 See The Internet Encyclopedia of Philosophy, “Legal Positivism,” here: www.utm.edu/research/iep/l/legalpos.htm.

20 Karl Marx, Critique of the Gotha Program; see Wikipedia entry here: en.wikipedia.org/wiki/From_each_according_to_his_ability,_to_each_according_to _his_need.

“voluntary agreement between the parties immediately affected”21 but by the authoritarian degree of a third party. And it is because of this positivization that society’s money has effectively been stolen from it, toppling the first of civilization’s twin pillars.

How could this happen? How could the state get away with stealing society’s money?

“For the étatist, money is a creature of the state,”22 and surely one of the greatest tragedies of our time is that the people, in their unwitting acceptance of monetary positivism, are statists themselves, if only as pawns in a game that has been rigged utterly and completely against them. For so meager and confused is the people’s understanding of money that it is inconceivable to them that “all money has originated, and must originate, in a useful commodity chosen by the free market as a medium of exchange;”23 that the state is accordingly “powerless to create money for the economy;”24 that the first act of every sufficiently large state is “to seize an absolute monopoly of the minting business” as the “indispensable means of getting control of the coinage supply;”25 that “inflation, being a fraudulent invasion of property, could not take place on the free market;”26 that with the creation of a central bank, all banks become, by extension, “arms of the government;”27 that “[c]entralization of credit in the hands of the State, by means of a national bank with State capital and an exclusive monopoly” is not capitalism but communism;28 that by going off the gold standard and issuing only fiat money, the state is simply issuing “paper … with nothing but paper backing;”29 that the globalization of this system constitutes “the most gigantic trust [cartel] on earth;”30 that the kingpin of this cartel is the U.S. Federal Reserve System; that the Federal Reserve can “never add anything to our capital structure, or to the formation of capital, because it is organized to produce credit;”31 that a monetary system based on credit is a monetary system based on debt; and that the U.S. government, which had virtually no

21 Ibid., Benson, p. 12.

22 Ibid., Mises, p. 277

23 Ibid., p. 53.

24 Ibid., p. 19.

25 Ibid., p. 62.

26 Ibid., p. 54.

27 Ibid., p. 72.

28 Karl Marx and Friedrich Engels, The Communist Manifesto, 1848, Washington Square Press, 1964, p. 94.

29 Eustace Mullins, Secrets of the Federal Reserve, Kasper and Horton, 1952, p. 202.

30 Congressman Charles Augustus Lindbergh, Sr., arguing against the Federal Reserve Act after its passage in 1913, as quoted by Eustace Mullins in Secrets of the Federal Reserve, p. 15.

31 Ibid., p. 118.

debt prior to the creation of the Federal Reserve, is now over $11 trillion in debt.32 And this does not include nearly $100 trillion in unfunded welfare liabilities,33 the sum total of which amounts to an indebtedness of well over $300,000, and counting, for every man, woman, and child in America.

Because these debts can never be repaid and will instead be simultaneously inflated away by the Federal Reserve and defaulted on by the Treasury, the American people will pay the price through the devaluation of the government’s monopoly money on the one hand—money, let us be clear, that has already lost over 97% of its value34—and through broken government promises on the other.

Moreover, as the government’s money metastasizes, so do its laws. And were the people to understand that the state’s law is no less fraudulent than its money, they would run from legal positivism as fast as they will soon be running from monetary positivism.

6. Law and the State

The more corrupt the State, the more numerous the laws. —Cornelius Tacitus

It has been said, albeit in jest, that the five most important words in the United States Constitution are “Congress shall make no law ...”35 It is of course impossible for Congress not to make law, however, for Congress is the legislative—i.e., the lawmaking—branch of government. As obvious as this is on its face, what is not at all obvious, but nonetheless true, is that legislated law is inherently in conflict with the very reason that Congress was created: namely, to represent the people. This is because … the more numerous the people are whom one tries to “represent” through the legislative process and the more numerous the matters in which one tries to represent them, the less the word “representation” has a meaning referable to the actual will of actual

32 See the U.S National Debt Clock here: brillig.com/debt_clock.

33 See Richard W. Fisher, “Storms on the Horizon: Remarks before the Commonwealth Club of California,” May 28, 2008, here: www.dallasfed.org/news/speeches/fisher/2008/fs080528.cfm.

34 See The Market Oracle, “Impact of US Dollar Inflation and Devaluation: Illusion, Myth, and Magic,” here: www.marketoracle.co.uk/Article3324.html.

35 The United States Constitution, Amendment 1: “Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the Government for a redress of grievances.”

people other than that of the persons named as their “representatives.”36

Since the matters to be dealt with are limitless, so is the legislation required to resolve them, which is why

… a legal system centered on legislation resembles … a centralized economy in which all the relevant decisions are made by a handful of directors, whose knowledge of the whole situation is fatally limited and whose respect, if any, for the people’s wishes is subject to that limitation.37

A cursory examination of the numbers, from a historical perspective, drives the point home:

The Constitution was framed for 3 million people in thirteen sovereign states. When the first Congress met in 1790, there was one representative for every 30,000 [people]. Since only property-holding white males could vote, [this comes to] around 5,000 voting citizens per [representative]. By 1920, the U.S. population was 90 million, and Congress capped representation in the house at 435, where it remains today. Now, however [2002, when the article was published], there are 287 million Americans, yielding a ratio of one representative for every 655,000. If we apply this ratio to 1790, there would have been only five members in the House of Representatives. Or, to put it another way, if the ratio of the framers existed today, there would be around 9,000 members in the House.38

Clearly, the notion that any but those with what are now commonly known as “special-interests”—i.e., those with the money to pay for the requisite access—are represented in any meaningful way in the U.S. today is ludicrous.39 And insofar as special interests are at odds with those of the people as a whole—i.e., insofar as they merely reflect the fact that the state is

36 Bruno Leoni, Freedom and the Law, Liberty Press, 1961, p. 19.

37 Ibid., pp. 6 and 7.

38 Donald W. Livingston, “Dismantling Leviathan,” Harper’s magazine, May, 2002, p. 14.

39 “It must be recognized that there is a powerful constituency for ignoring the constitutional limits on governmental powers, and there is no well-organized pressure group of any consequence in favor of it. All special-interest groups seeking a share of federal largesse work diligently, day in and day out, to urge the government to abandon or ignore constitutional limits and award them subsidies. In contrast, the general public is widely dispersed and rarely ever well organized politically. The public would benefit most from constitutional government, but costs overwhelm the effort to coalesce the masses into an effective political pressure group.” Thomas J. DiLorenzo, Lincoln Unmasked: What You’re Not Supposed to Know About Honest Abe, Three Rivers Press (Crown Publishing Group, Random House, New York), 2006, p. 72.

“the fictitious entity by which everyone seeks to live at the expense of everyone else”40—it is equally clear that what is represented is, in the end, the interests of the state itself, since it has no other means of living at all: It is unfortunately none too well understood that, just as the State has no money of its own, so it has no power of its own. All the power it has is what society gives it, plus what it confiscates from time to time on one pretext or another; there is no other source from which State power can be drawn. Therefore, every assumption of State power, whether by gift or seizure, leaves society with so much less power; there is never, nor can be, any strengthening of State power without a corresponding and roughly equivalent depletion of social power.41

This being so, the growth of state power demonstrates beyond all doubt the trend away from representation and toward centralization. At the time of its founding, the combined civil and military employment of the U.S.’s then-federal government was perhaps 2,500 people, 42 or roughly one for every 1,600 citizens,43 while its now-central government (being federal in name only) employs some 14.6 million people,44 or approximately one for every 21 of the nation’s roughly 306 million citizens.45 Amounting to a growth rate of nearly 7,600%, it is little wonder, then, that Americans’ tax burden has grown even more. For while the average U.S. citizen paid a paltry $20 a year in federal taxes at the time of the nation’s founding, today the

40 See Frederic Bastiat online at The Library of Economics and Liberty, The State,

Chapter 5.20, here: www.econlib.org/library/Bastiat/basEss5.html.

41 Albert Jay Nock, Our Enemy the State, Libertarian Review Foundation, 1989 (1935),

Chapter 5, “Social Power vs. State Power,” p. 5.

42 Records only go back to 1816, at which time, according to TABLE Ea894–903 of the Historical Statistics of the United States, Millennial Online Edition (hsus.cambridge.org/HSUSWeb/HSUSEntryServlet), there were a total of 4,837 federal employees, rising to 399,381 in 1916 and reflecting a growth rate over 8,200%. Working backwards to 1790, then, 2,500 federal employees at that time is a very generous estimate and could well have been significantly lower.

43 See Wikipedia, “Demographics of the United States / Population Growth,” here: en.wikipedia.org/wiki/Demographics_of_the_United_States#Population_growth 44 Christopher Lee, “Big Government Gets Bigger; Study Counts More Employees, Cites Increase in Contractors,” The Washington Post, October 6, 2006, p. A21; online version here: www.washingtonpost.com/wp-dyn/content/article/2006/10/05/AR2006100501782.html.

45 See the U.S. Census Bureau’s “U.S. POPClock Projection,” here: www.census.gov/population/www/popclockus.html.

average citizen pays over $10,000 a year in inflation-adjusted terms,46 amounting to a growth rate of fully 50,000%.

And little wonder, as well, that the legal apparatus that propels the process is equally out of control. After all, the laws on the books in the United States have long been beyond counting, and Congress has no interest in capping them for the simple reason that by doing so it would put its members out of a job. What Congress does instead—with the full support of the other two branches of government—is to secure the jobs of its members through the passage of one positivist statute, project, and program after another. And thus do we confront a fundamental difference between negative and positivist law: while negative law tends not to multiply beyond necessity, positivist law invariably does. So even though it makes vastly more sense for society to be ruled by the paucity of the former than by the profligacy of the latter—precisely as the well-established Principle of Parsimony47 suggests— the latter nonetheless prevails.

Furthermore, legal positivism not only creates new laws but, in the process, new “rights.” And as distinct from the few and very real rights upon which civil society is based—i.e., as distinct from the non-intervention of the negative golden rule—positivist rights are inherently interventionist in that, as grants of privilege, they impose obligations on some for the benefit of others. Be it food, housing, healthcare, employment, education, retirement, or some other “entitlement,” others—namely, taxpayers—are forced to pay for them, meaning that individuals’ legitimate rights are ipso facto violated in spite of the fact that every “entitlement” comes at a cost greater to society than the benefit received.48

Moreover, because ignorantia juris non excusat—”ignorance of the law is no excuse”—it is inevitable that as the legal apparatus expands, certainty of the law—which “is probably the most important requirement for the economic activities of society”49—becomes impossible. And thus is the social enterprise set adrift upon a sea of uncertainty, its compass useless amid the

46 See WSJ Opinion Archives, “Mr. Stossel Goes to Washington,” January 26, 2001, here: www.opinionjournal.com/diary/?id=85000497.

47 “One should always choose the simplest explanation of a phenomenon, the one that requires the fewest leaps of logic; see Principia Cybernetica Web, “Principle of Parsimony or Principle of Simplicity,” here: pespmc1.vub.ac.be/asc/PRINCI_SIMPL.html.

48 This is so for the simple reason that the associated taxes are not loans to be repaid at an agreed-upon interest rate, nor are they investments made with the expectation of a risk-worthy return. Rather, the money is simply confiscated with the promise that the “entitlement” will accrue to society’s overall benefit.

49 Ibid., Leoni, p. 70.

perfect storm of legal positivism; thus does legislation result not in law at all but lawlessness; and thus does it subject society to the nullification of the complex by the of the institutionalization of the complicated. For even though the words are generally considered to be synonymous, a subtle but vitally important distinction can be made between the complex and the complicated vis-à-vis the unintended consequences of the market versus those of the state.

We are all familiar, of course, with Adam Smith’s famous passage in The Wealth of Nations regarding “the invisible hand,”50 whereby the individual, in pursuit of his own interests, “frequently promotes that of the society more effectually than when he really intends to promote it,” doing so in recognition of the fact that “It is not from the benevolence of the butcher, the brewer or the baker, that we expect our dinner, but from their regard to their own self interest.” Thus do we “address ourselves, not to their humanity but to their self-love, and never talk to them of our own necessities but of their advantages.”

And simply put, this is how the market functions—i.e., as an endeavor in which people cooperate in recognition one another’s self-interest—the result of which, with the introduction of money, is complexity on a scale that would be unattainable—indeed, unimaginable—on the level of subsistence or barter. And we have but to consider an age-old board game, chess, to understand this. For its simple and certain rules, which virtually anyone can comprehend, provide for a permutation of moves in an all but infinite variety, the elegance of which has attracted humanity’s finest minds since the game’s invention, more recently pitting high-powered computers against them.51 In other words, what makes chess so elegant is precisely what makes the market so elegant, their respective rules being so few, certain, and understandable that each is all but unlimited in the complexity it can generate, said complexity adding commensurately to the enjoyment of life.

Not so for, say, the U.S. tax code, which was only a few pages long at the time of its introduction in 1913 but is now nearly seven times the length of the Bible,52 requiring some 7.6 billion work-hours of tax compliance each year53 at a cost that is projected to rise from over a quarter trillion dollars

50 As summarized by Wikipedia here: en.wikipedia.org/wiki/Wealth_of_Nations#The_invisible_hand.

51 See a summary of IBM’s “Deep Blue” chess computer here: en.wikipedia.org/wiki/IBM_Deep_Blue.

52 See “How long is the US Tax Code?” at the Trygve.com digital diary, March 12, 2006, here: www.trygve.com/taxcode.html.

53 See USA Today, “New Report: Doing taxes takes up to 7.6 billion work hours a year,” January 9, 2009, here: www.usatoday.com/money/perfi/taxes/2009-01-07-tax—compliance-costs_N.htm.

today to nearly half a trillion dollars by 2015.54 So incomprehensible that not even one of the world’s most renowned geniuses could understand it,55 the U.S. tax code constitutes drudgery on a massive scale, detracting in like proportion from the quality of life and doing so solely to transfer power from society to the state.

And thus do we arrive at the vital distinction between the rule of law and its ruin—i.e., between that which generates spontaneous order and that which degenerates into one regimented order after another—as it leads us to this critically important conclusion: Society is inherently complex and accordingly unlimited in the amount of order it can generate, while the state is inherently complicated and accordingly unlimited in the amount of disorder it can generate.

In light, then, of the rampant disorder with which we are now confronted, it is clear that in positivizing society’s money and its law, the state has not only toppled the twin pillars of civilization; it has shattered the foundation upon which they stand. For it has destroyed the freedom that is society’s sine qua non and thus imperiled society’s very existence.

But how could it have done so? And why has it done so?

In other words, what is the state? And how did it come to be?

7. The Nature and Origin of the State

The idea that the State originated to serve any kind of social purpose is completely unhistorical. —Albert Jay Nock

It is imperative that we understand, first of all, that “[e]verything the state is capable of doing it does through compulsion and the application of force.”56 The state cannot give without taking, in other words, and it cannot take without the initiation of force or the threat thereof. Even apologists for the state cannot deny this fact.57

54 See Scott A. Hodge, J. Scott Moody, and Wendy P. Warcholik, Ph.D, “The Rising Cost of Complying with the Federal Income Tax,” Tax Foundation, January 10, 2006, The Tax Foundation Special Report, here: www.taxfoundation.org/news/show/1281.html.

55 “The hardest thing to understand in the world is the income tax.” —Albert Einstein

56 Ibid., Mises; see Liberalism in the Classical Tradition, Chapter 1, “The Foundations of Liberal Policy,” Section 13, “The State and Antisocial Conduct,” here: www.mises.org/liberal/ch1sec13.asp.

57 See Wikipedia, “Monopoly on violence,” here: en.wikipedia.org/wiki/Monopoly_on_the_legitimate_use_of_physical_force. 16 LIBERTARIAN PAPERS 1, 32 (2009)

Neither can its apologists deny (at least convincingly) that “every State has been and is a class State, and every theory of the State has been and is a class theory,”58 acknowledgement of which can be found as far back as Plato, who addressed the origin of the ruling class, in both The Statesman and The Republic, by harkening back to a time when nomad tribes first came to live under a patriarch: These nomad tribes, we hear, settled in the cities of the Peloponnese, especially in Sparta, under the name of “Dorians.” …

In a parallel passage in The Republic, Plato gives us a mythological yet very pointed description of the conquest itself, when dealing with the origin of the “earthborn,” the ruling class of the best city. Their victorious march into the city, previously founded by the tradesmen and workers, it described as follows: “After having armed and trained the earthborn, let us now make them advance, under the command of the guardians, till they arrive in the city. Then let them look round to find out the best place for their camp—the spot that is most suitable for keeping down the inhabitants, should anyone show unwillingness to obey the law, and for holding back external enemies who may come down like wolves on the fold.” This short but triumphant tale of the subjugation of a sedentary population by a conquering war horde … must be kept in mind when we interpret Plato’s reiterated insistence that good rulers ... are patriarchal shepherds of men, and that the true political art, the art of ruling, is a kind of herdsmanship, i.e., the art of managing and keeping down human cattle.59

Even so, Plato’s pupil Aristotle rejected this “art,” placing the origin of the state more palatably, albeit mistakenly, at the end of a purely organic process: The belief in the kinship origin of the State has been among the most deeply rooted manifestations of the Western faith in development continuity. The popularity of the belief owes much to Aristotle’s celebrated triadic scheme of evolution—from family to community to State—and has been nourished in modern times by frequent appeals to irrelevant and historically unconnected ethnographic materials. As is true in so many other alleged instances of developmental continuity, the fact of logical continuity has been

58 Franz Oppenheimer, The State, Copley Publishing, 1914, p. 4; online version here: www.franz-oppenheimer.de/state0.htm.

59 Karl Popper, The Open Society and Its Enemies, Princeton University Press, New Jersey, 1962, 1966, p. 49.

converted into the supposition of historical continuity within a specific area or chronology.60

Moreover, not only was it assumed, following Aristotle, that “from such an original social order … there had developed, through gradual differentiation, the fully developed State with its class hierarchy;”61 it was also assumed that said order developed because all productive land had been settled: All the teachers of natural law, etc., have unanimously declared that the differentiation into income-receiving classes and propertyless classes can only take place when all fertile lands have been occupied.

For so long as man has ample opportunity to take up unoccupied land, “no one,” says Turgot, “would think of entering the service of another” …

… The philosophers of natural law, then, assumed that complete occupancy of the ground must have occurred quite early, because of the natural increase of an originally small population. They were under the impression that at their time, in the eighteenth century, it had taken place many centuries previous, and they naively deduced the existing class aggroupment from the assumed conditions of that long-past point in time.62

Never questioning their assumptions, however, it simply did not occur to these thinkers that they could

… determine with approximate accuracy the amount of land of average fertility in the temperate zone, and also what amount is sufficient to enable a family of peasants to exist comfortably, or how much such a family [could] work with its own forces, without engaging outside help or permanent farm servants. … Let us assume that, in these modern times, thirty morgen (equal to twenty acres) for the average peasant suffices to support a family. …

… [T]here are still on the earth’s surface, seventy-three billion, two hundred million hectares (equal to on hundred eighty billion, eight hundred eighty million and four hundred sixteen thousand acres); dividing into the first amount the number of human beings [at the time, 1914]…viz., one billion, eight hundred million, every family of five persons could possess about thirty morgen (equal to eighteen and a half acres), and still leave about two-thirds of the planet unoccupied.

60 Robert Nisbet, The Quest for Community: A Study in the Ethics of Order and Freedom, ICS Press, 1990 (Oxford University, 1953), pp. 90 and 91.

61 Ibid., Oppenheimer, p. xix.

62 Ibid., p. 6.

If, therefore, purely economic causes are ever to bring about a differentiation into classes by the growth of a propertyless laboring class, the time has not yet arrived. …

… As a matter of fact, however, for centuries past, in all parts of the world, we have had a class-state, with possessing classes on top and propertyless laboring classes at the bottom, even when population was much less dense than it is today. Now it is true that the class-state can arise only where all fertile acreage has been occupied completely; and since … all the ground is not occupied economically, this must mean that it has been preempted politically.

Since land could not have acquired “natural scarcity,” the scarcity must have been “legal.” This means that the land has been preempted by a ruling class against its subject class, and settlement prevented. Therefore, the State, as a class-state, can have originated in no other way than through conquest and subjugation.63

Thus, while it would be too much to say that property is theft,64 it is not at all be too much to say that insofar as people have historically found themselves without property, it is not because those “best endowed with strength, wisdom, capacity for saving, industry and caution, slowly acquire[d] a basic amount of real or movable property; while the stupid and less efficient, and those given to carelessness and waste, remain[ed] without possessions.”65 Rather, one group has simply forced itself on another group … with the sole purpose of regulating the dominion of the victorious group over the vanquished, and securing itself against revolt from within and attacks from abroad. Teleologically, this dominion had no other purpose than the economic exploitation of the vanquished by the victors.66

And thus do we come to the all-important distinction between society and the state:

There are two fundamentally opposed means whereby man, requiring sustenance, is impelled to obtain the necessary means for satisfying his desires. There are work and robbery, one’s own labor and the forcible appropriation of the labor of others … the “economic means” … and the “political means.”

63 Ibid., pp. 6 and 7.

64 See Pierre-Joseph Proudhon, What Is Property? Or, an Inquiry into the Principle of Right and of Government, summarized in Wikipedia here: en.wikipedia.org/wiki/Property_is_theft.

65 Ibid., Oppenheimer, p. 5.

66 Ibid., p. 8.

The state is an organization of the political means. No state, therefore, can come into being until the economic means has created a definite number of objects for the satisfaction of needs, which objects may be taken away or appropriated by warlike robbery.67

In other words, the state creates and sustains itself through aggression— i.e., through the initiation of force—first through its conquest of territory, then through the twofold process of subjugating the inhabitants to its territorial monopoly on aggression, which it then uses to confiscate the inhabitants’ property via the legalized theft of taxation.

And no matter how successful it has been in indoctrinating its people to believe otherwise (and of course it has been enormously successful), the American state is in no way an exception. On the contrary, it is thoroughly an organization of the political means, as were the colonies that preceded it: The first fortunes on the virgin continent were out-and-out political creations—huge tracts of [conquered] land and lucrative trading privileges arbitrarily bestowed by the British and Dutch crowns upon favorite individuals and companies. ... The early royal grants … were the sole property titles of the newly created landed aristocrats.68

And while the received truth regarding the subsequent creation of a constitutional republic is decidedly different—nothing less than a “miracle,” in fact69—the real truth is that the United States Constitution, like all constitutions, was “not instituted to limit government but rather to enhance the political power of an elite that [sought] to entrench itself.”70 After all, the United States Constitution was written by and for a small class of property-owning adult white males who limited the vote almost exclusively to themselves, creating an oligarchy that, in positivizing law and money at the outset,71 was destined to become evermore tyrannical, as indeed it has.

Thus, instead of the “model for the protection of man in a state of freedom and order” that Jefferson imagined it to be,72 the American state was from its founding a model of conquest and subjugation—not only of the

67 Ibid., pp. 12 and 13.

68 Ferdinand Lundberg, America’s Sixty Families, Vanguard Press, 1937, p. 50.

69 Catherine Drinker Bowen, Miracle at Philadelphia: The Story of the Constitutional Convention, Little Brown, 1986.

70 See Jeffrey A. Tucker, “Hoppeism and the Bailout,” Ludvig von Mises Institute; August 6, 2002, here: www.mises.org/article.aspx?Id=1021.

71 The United States Constitution, Article 1, Sections 1 and 8.

72 Letter to Thaddeus Kosciusko, 1799; see Thomas Jefferson on Politics & Government here: etext.virginia.edu/jefferson/quotations/jeff1800.htm.

continent’s millions of native inhabitants and the millions of others imported from another continent, but of the human detritus endlessly washing up on its shores from elsewhere.73 As such, the American state is simply another state and, like any state, is therefore “an evil inflicted on men by men”74—one that persists solely through the acquiescence of the people, who, having been thoroughly indoctrinated by their government, are only too willing to accede to its never-ending demands. And to make matters worse, even some who are not indoctrinated but, on the contrary, recognize the state as the evil that it is, compound that evil by maintaining that the preservation of society nonetheless “justifies the action of the organs of the state.”75

This is a very serious proposition—so serious, in fact, that the very foundation of human morality hangs in the balance, and with it the very viability of civil society. If, therefore, humanity is to have any hope of ridding itself of the state, it must be shown that because the state is inherently evil, there can be no justification for its existence.

So to this task we now turn, via another brief foray into metaphysics.

8. Evil and the State

Government, even in its best state, is but a necessary evil. —Thomas Paine

If the state is “an evil inflicted by men on men,” yet the preservation of society nonetheless “justifies the action of the organs of the state,” then the inescapable conclusion is that the state is indeed “a necessary evil.” But how can this be? How can this or any other evil be necessary without rendering evil itself necessary? And if evil itself is necessary, then what of right and wrong, and thus of human morality? For surely the necessity of evil renders human morality null and void, as any action, no matter how heinous, can therefore be justified. Law is then whatever anyone says it is who has the power to back it up; might then makes right; and the state, which is solely an instrument of might, is then the only “legitimate” authority. Thus absolute, it is accordingly deified, in which case Hegel’s horrifying assertion that the state

73 “[P]oor laborers will be so plenty [sic] as to render slavery useless.” — Revolutionary Connecticutian Oliver Ellsworth replying to revolutionary Virginian George Mason, as quoted by Forrest McDonald in Novus Ordo Seclorum: The Intellectual Origins of the Constitution, the University Press of Kansas, 1985, p. 51.

74 See Ludwig von Mises, Liberalism, Part 1: “The Foundations of Liberal Policy,”

Chapter 13, “The State and Antisocial Conduct,” here:

mises.org/liberal/ch1sec13.asp.

75 Ibid.

GOLD, THE GOLDEN RULE, AND GOVERNMENT 21
is “the march of God in the world”76 becomes an absolute truth, never mind that truth per se has no meaning and that the world is once again absurd.

To escape this travesty of reason, then, we must show that however inevitable it might be, evil can never be necessary, which we can only do by defining what evil is. And we do so by (1) acknowledging the primordial fact that being is, (2) intuiting from it the primordial value that being is good, and (3) acting on the resultant impulse that more being is better. For from these it follows that (1) less being is bad, (2) nonbeing is worst of all, and (3) evil therefore consists of that which fosters one or both.

Understood in this way, it is clear that evil has no existence apart from being and the goodness thereof—i.e., it has no metaphysical reality of its own—and is instead derivative of them. Thus did Augustine of Hippo, for example, argue against … the Manichean conception of evil as an independent reality and power coeternal with good by his analysis of evil … as the privation, corruption, or perversion of something good. Evil, he taught, has no independent existence, but is always parasitic upon good, which alone has substantial being.77

While its apologists would have us believe that the state exists solely to serve society, we know, on the contrary, that because the state has no power beyond what it is able to extract from society, its existence is entirely dependent upon the good(s) that society is able to produce. And as such dependency is the very definition of parasitism, we confront the state the same way we would any parasite—i.e., as that which preserves itself at the expense of its host.

It follows, then, that while the state is indeed “an evil inflicted by men on men,” the preservation of society in no way “justifies the action of the organs of the state.” Instead, it justifies whatever action society deems necessary to lessen the evil if not eradicate it altogether. And as this includes the evil that manifests itself in the so-called democratic state, it is to this most insidious form of evil that we now turn.

76 See G. F. W. Hegel, The Philosophy of Right, 1820, online English translation here: www.marxists.org/reference/archive/hegel/works/pr/prstate.htm#PR257; extended quotation as follows: “The march of God in the world, that is what the state is. The basis of the state is the power of reason actualizing itself as will. In considering the Idea of the state, we must not have our eyes on particular states or on particular institutions. Instead we must consider the Idea, this actual God, by itself.”

77 The Encyclopedia of Philosophy, Macmillan Publishing Co., Inc. & The Free Press, New York, 1967, Vol. 3, pp. 136 and 137.

22 LIBERTARIAN PAPERS 1, 32 (2009)

9. Democracy and Its Contradictions

The God That Failed —Hans-Hermann Hoppe78

Democracy, as Churchill said, “is the worst form of government except for all those other forms that have been tried from time to time,”79 the assumption being that because the state is necessary, the democratic state is the best state, even if it is merely the best among bad ones. This flies in the face, of course, of the godlike esteem in which democracy is held around the world, both by those who are citizens of democratic states and by those who yearn to be. Democracy, after all, is based on the right of self-determination—i.e., “the proposition that the legitimacy of all political power arises from, and only from, the consent of the governed, the people”80—and so, then, must any state founded on this proposition.

The problem, however, is that self-determination and democracy are mutually exclusive propositions. After all, the people’s consent is supposedly expressed through the ballot box—i.e., through the right to vote—yet what, in truth, does this have to do with self-determination?

Doubtless the most miserable of men, under the most oppressive government in the world, if allowed the ballot, would use it, if they could see any chance of thereby meliorating their condition. But it would not, therefore, be a legitimate inference that the government itself, that crushes them, was one which they had voluntarily set up, or even consented to.81

In other words, what does it mean to vote within the confines of that which one had no say in creating and when those confines, therefore, cannot legitimately—i.e., in a morally justified manner—rule over one? Even assuming that those confines are minimal, as is arguably the case with the United States Constitution as written, what real authority or obligation can such a document have? The answer, simply put, is none: The Constitution has no inherent authority or obligation. It has no authority or obligation at all, unless as a contract between man and man. And it does not so much as even purport to be a contract

78 Democracy: The God That Failed, Transaction Publishers, New Brunswick, New Jersey, 2001; see book description here: www.mises.org/store/Democracy-The-God—That-Failed-P240.aspx 79 Speech to the House of Commons, November 11, 1947; expanded quotation here.

80 Robert Nisbet, The Quest for Community: A Study in the Ethics of Order & Freedom, ICS

Press, 1990 (Oxford University Press, 1953), p. 220.

81 Lysander Spooner, No Treason, No. VI, The Constitution of No Authority, 1870; online version here: www.lysanderspooner.org/bib_new.htm.

GOLD, THE GOLDEN RULE, AND GOVERNMENT 23
between persons now existing. It purports, at most, to be only a contract between persons living [long] ago. … Furthermore, we know, historically, that only a small portion even of the people then existing were consulted on the subject, or asked, or permitted to express either their consent or dissent in any formal manner. Those persons, if any, who did give their consent formally, are all dead now. … And the constitution, so far as it was their contract, died with them. They had no natural power or right to make it obligatory upon their children. It is not only plainly impossible, in the nature of things, that they could bind their posterity, but they did not even attempt to bind them. That is to say, the instrument does not purport to be an agreement between any body but “the people” then existing; nor does it, either expressly or impliedly, assert any right, power, or disposition, on their part, to bind anybody but themselves.82

Moreover,

As taxation is made compulsory on all, whether they vote or not, a large proportion of those who vote, no doubt do so to prevent their own money being used against themselves; when, in fact, they would have gladly abstained from voting, if they could thereby have saved themselves from taxation alone, to say nothing of being saved from all the other usurpations and tyrannies of the government. To take a man’s property without his consent, and then to infer his consent because he attempts, by voting, to prevent that property from being used to his injury, is a very insufficient proof of his consent to support the Constitution. It is, in fact, no proof at all. And as we can have no legal knowledge as to who the particular individuals are, if there are any, who are willing to be taxed for the sake of voting, we can have no legal knowledge that any particular individual consents to be taxed for the sake of voting; or, consequently, consents to support the Constitution.

Just as representative democracy is a sham, then, so is the constitutionalism that attends it. For the latter is based not on self-determination but on pre-determination, which, under the best of circumstances, merely provides the means by which such consent as may be presumed to have been given by one generation can accordingly be withdrawn by a subsequent one. And the best can hardly be said to prevail. For while the most famous political document ever written, the Declaration of Independence, clearly affirms the absolute right of self-determination—i.e., of secession—the constitution that followed it makes no mention of this right, nor does the nation founded on the basis of it recognize its validity. On

82 Ibid.

24 LIBERTARIAN PAPERS 1, 32 (2009)

the contrary, the U.S. government has made it clear that it will pursue secessionists to the point of genocide on the presumption that they are ipso facto traitors. A “Civil War” was fought on this very point, after all, at a cost of some 630,000 lives and an untold destruction of property, at the conclusion of which the U.S. government was forced to abandon the trial of the secessionists’ leader, realizing that to do so would be to expose the fallacy of its argument: “The federal government knew that it could not try [Confederate President Jefferson] Davis for treason without raising the constitutional issue of secession.”83

Nonetheless, nearly a century and a half later, the U.S. government staunchly maintains its position (without openly defending it) and does so with full knowledge that its erstwhile adversary, the former Soviet Union, and its present one, China, each cited the Civil War as their authority for using force to keep their own states intact: Perhaps the most dangerous legacy of the war was the Northern claim that it could use force and go to war to prevent any state from withdrawing from the Union. This has haunted us in the past decade and will continue to do so, as the Soviet Union’s Mikhail Gorbachev claimed the right to use force to hold his union together and cited Abraham Lincoln as good authority for doing so. In 1999, the Chinese premier reminded President Clinton that he had the right to use force to hold China together, to go to war to reclaim Taiwan, and he too cited Abraham Lincoln as good authority.84

But such is the logic of the state that it seeks to perpetuate itself at any and all cost, and thus does the state labeled “democratic” fall victim to its own hypocrisy. For any state that denies its citizens the absolute right of self-determination is totalitarian, the more so in accordance with how far it will go to deny that right. And while 630,000 lives are but a small fraction of the those lost in the great lie that was Stalinist Russia,85 insofar as Lincolnian America fell victim to a lie of its own,86 the lies differ only in degree, not in

83 Charles Adams, When In the Course of Human Events, Rowman & Littlefield, 2000,

Chapter 12, “The Trial of the Century that Never Was,” p. 178.

84 Ibid., pp. 228 and 229.

85 Stalin’s purges and forced famine (1932-38) are estimated to have killed well over 20 million people; see here, for example: www.flashpoints.info/issue_briefings/Genocide/Genocide_main.htm#russia 86 See, for example, Charles Adams, When in the Course of Human Events: Arguing the

Case for Southern Secession. Lanham, Rowman & Littlefield, Maryland, 2000; Donald W. Livingston, “A Moral Accounting of the Union and the Confederacy,” The Journal of Libertarian Studies, Volume 16, no. 2 (Spring 2002), pp. 57–101; Thomas J. DiLorenzo, The Real Lincoln: A New Look at Abraham Lincoln, His Agenda, and an Unnecessary War, Prima GOLD, THE GOLDEN RULE, AND GOVERNMENT 25
kind. Moreover, insofar as the perpetuation of the American lie has fostered the continued plunder of society, the death toll from decades of unwarranted poverty might well be in the tens of millions itself. After all, the Great Depression—which, contrary to the conventional wisdom, was both perpetrated and perpetuated by the U.S. government’s own policies87—surely caused the premature deaths of millions, to say nothing of how many lives have been needlessly foreshortened since then, or will be by time the coming HyperDepression88—also a direct result of the U.S. government’s own policies89—finally exhausts itself.

To its credit, the government of Canada did not prevent one of its constituent provinces from holding a referendum on secession. And no matter that the referendum failed, the fact that it was allowed at all is commendable.90 Ask any of the elected officials of the American state whether its citizens have this right, however, and they will be at a complete loss for words, knowing that to deny the right is to deny the principle upon which the nation was founded, while to affirm it is to open the floodgates of the government’s demise and the consequent loss of their sustenance through the political means.

Many will argue, of course, that the offenses of any particular democratic state are insufficient in themselves to deny the validity of the democratic ideal. And while the cynic might reply that just because the

Lifestyles, 2002; and DiLorenzo, Lincoln Unmasked: What You’re Not Supposed to Know About Honest Abe, Crown Forum, 2006.

87 For a thorough examination, see Murray N. Rothbard, America’s Great Depression

(Fifth Edition available online here: mises.org/rothbard/agd.pdf) and Robert P. Murphy, The Politically Incorrect Guide to the Great Depression and the New Deal, Regnery Publishing, 2009 (book description here: www.mises.org/store/Politically-Incorrect-Guide-to-the-Great-Depression-and-the-New-Deal-P580.aspx).

88 This term is offered on the belief that unlike the Great Depression, the even larger calamity to come will be biflationary—en.wikipedia.org/wiki/Biflation—in that the U.S. will experience rampant inflation in consumer goods and commodities, on the one hand, and rampant deflation in stocks, bonds, and real estate, on the other, amid the dollar’s demise as the world’s reserve currency and its subsequent collapse.

89 See, for example, Thomas E. Woods Jr., Meltdown: A Free-Market Look at Why the Stock Market Collapsed, the Economy Tanked, and Government Bailouts Will Make Things Worse, Regnergy Publishing, 2009; online book description here: mises.org/store/Meltdown-P557.aspx 90 While Canada’s supreme court ruled that “unilateral secession” was illegal, it granted, conversely, that the central government “would have no basis to deny the right of the government of Quebec to pursue secession.” See Wikipedia, “Secession of Quebec, / The opinion,” here: en.wikipedia.org/wiki/Reference_re_Secession_of_Quebec#The_opinion 26 LIBERTARIAN PAPERS 1, 32 (2009)

democratic state doesn’t work in practice doesn’t prove that it can’t work in theory, let us eschew cynicism and simply ask the question that Thoreau asked: “Is a democracy, such as we know it, the last possible improvement in government? Is it not possible to take a step further towards recognizing and organizing the rights of man?”91

The answer is that we will never know until the democratic ideal is acknowledged to be absolute—i.e., until the powers that be acquiesce to the fact that the right of self-determination is an individual, not a collective, right and that every individual therefore has the right to decide the terms and conditions under which he will be governed. This isn’t to say that the individual, insofar as he chooses to live in society, must not be governed, for without governance of some kind—i.e., without a rule of law—civil society is impossible. It is to say, rather, that insofar as society can accommodate self-determination as an individual right, it will be vastly better off for doing so, the constant threat of secession being the only means whereby “the action of the organs of the state” can be held in check.

And once established, the absolute right of self-determination will set the stage for what would otherwise be impossible.

10. The Transition to a Free Society

We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness. —That to secure these rights,

Governments are instituted among Men, deriving their just powers from the consent of the governed, —That whenever any Form of Government becomes destructive of these ends, it is the Right of the People to alter or to abolish it, and to institute new Government, laying its foundation on such principles and organizing its powers in such form, as to them shall seem most likely to effect their Safety and Happiness.

—Thomas Jefferson, The Declaration of Independence

The first, most fundamental, and most necessary step in the transition to a free society is the collapse of the modern “monster state.”92 And the first, most fundamental, and most necessary step in that process is the collapse of the monstrous American state. For insofar as it is the apotheosis of the democratic state, the American state’s collapse will represent, in historical

91 Henry David Thoreau, “Civil Disobedience.” Online version here: sunsite.berkeley.edu/Literature/Thoreau/CivilDisobedience.html 92 Ibid., Livingston, p. 14.

terms, the demise of the state as such, and for the very reasons outlined above: What made the state unique was that it replaced the ruler with an abstract, anonymous mechanism made up of laws, rules, and regulations. The laws, rules and regulations were the main thing, the people who staffed them and put them into practice merely incidental and, as Stalin once said, replaceable. If only because, being abstract, it could not die, the state was infinitely more powerful than any individual person (and, therefore, any previous political organization) had ever been. So powerful, indeed, that it expanded in all directions and over all continents until, in 1914, seven states shared practically the entire earth between them.93

Thus is it “no exaggeration to say that the twentieth century was an eighty years’ war between the giants created in the nineteenth century,94 and thus is it no exaggeration to say that such giants will ultimately have no place in the twenty-first century. For notwithstanding its desperate attempt to use the present crisis to extend its reach both at home95 and abroad96 (for such is the nature of the beast),97 the fact is that the American state is collapsing under its own weight and is destined to become not just the latest but the last victim of “imperial overstretch,”98 its demise igniting a worldwide devolution of power that will end where it belongs: in the individual. In fact, even as the powers that be conspire to create an EU-like super-state complete with its own euro-like currency,99 the pull in the opposite direction is well

93 Martin van Creveld, “The State: Its Rise and Decline,” excerpted here— mises.org/story/527—on October 16, 2000 from a Mises Institute lecture.

94 Ibid., Livingston, p. 14.

95 “You never want a serious crisis to go to waste.” —Presidential Chief of Staff Rahm Emanuel, speaking to a Wall Street Journal conference of top corporate chief executives, November 2009; see YouTube video here: www.youtube.com/watch?v=_mzcbXi1Tkk 96 “Never waste a good crisis.” —US Secretary of State Hillary Clinton, speaking to the European Parliament, March 6, 2009; see YouTube video here: www.youtube.com/watch?v=B62igfNu-T0

97 For an examination of the state’s relentless opportunism, see Robert Higgs, Crisis and Leviathan: Critical Episodes in the Growth of American Government, Oxford University Press, USA, 1987; online book description here: www.mises.org/store/Crisis-and-Leviathan—P138C0.aspx 98 See Paul Kennedy, The Rise and Fall of the Great Powers, Random House, 1987.

99 Plans for a so-called North American Union have been denied by government officials (see Wikipedi here: en.wikipedia.org/wiki/North_American_Union), which of course means nothing. The same can be said of the so-called “amero”; see YouTube clip of CNBC interview of Steve Previs, Vice President of Jefferies International, LTD., November 27, 2006, here: www.youtube.com/watch?v=6hiPrsc9g98

underway,100 there being no law against—i.e., no Constitutional prohibition of—secession. On the contrary, The procedure for joining the Union also applied to withdrawing from the Union. And the Tenth Amendment, which reserved to the states powers not delegated to the federal government, would seem to put the matter of secession with the states and the people.101

So, too, would the fact that the delegations of three states, in ratifying the Constitution, specifically reserved not only each state’s right to withdraw from the Union but the people’s right to do so. For example, The People of Virginia declare and make known that the powers granted under the Constitution being derived from the People of the

United States may be resumed by them whosoever the same shall be perverted to their injury or oppression …102 [emphasis added]

Clearly, then, not only the state of Virginia but any number of its citizens can legally secede from the Union. But as the U.S. Supreme Court, however groundlessly, would no doubt rule against them, were they to attempt to do so, let us dispense with the U.S. government’s law altogether and appeal instead to the fact that one has no obligation to obey an immoral law but, on the contrary, a duty to break it.103 And let us imagine that the lawbreaking manifests itself in the form of a nonviolent protest, such that an initial fraction puts the “injury and oppression” of the American state to the test by standing up in defense of the right of self-determination and declaring its freedom accordingly. Moreover, let us do so by recalling the spectacle of a lone man confronting the armored emblem of the state in the capital city of a communist dictatorship.104 Glued to its television sets, the world watched in horror and fascination as the brave young man stood his ground while the mechanized monster tried in vain to outmaneuver him, the question being

100 For example, see BC Blogcritics, “State Sovereignty Movement Keeps Growing,”

here: blogcritics.org/politics/article/state-sovereignty-movement-keeps-growing 101 Ibid., Adams, p. 181.

102 See Walter Williams, “Parting Company,” August 7, 2002, at WorldNetDaily here: www.worldnetdaily.com/news/article.asp?ARTICLE_ID=28529

103 Ralph Waldo Emerson, “Address to Citizens of Concord,” May 3, 1851: “An immoral law makes it a man’s duty to break it, at every hazard. For virtue is the very self of every man. It is therefore a principle of law that an immoral contract is void, and that an immoral statute is void. For, as laws do not make right, and are simply declaratory of a right which already existed, it is not to be presumed that they can so stultify themselves as to command injustice.” See online version here: www.davemckay.co.uk/philosophy/ emerson/emerson.php?name=emerson.11.miscellanies.06.

104 See YouTube video clip, “1989 Tiananmen Square Protests,” here: www.davemckay.co.uk/philosophy/emerson/emerson.php?name=emerson.11.miscellani es.06.

why it tried to outmaneuver him at all. That is, why didn’t the monster simply stay its course, the better for its monstrous master to leave no question as to who controlled whom?

The answer is simple: Because the whole world was watching. And given that the Chinese government remains humiliated to this day by this otherwise minor (if heroic) incident, one can only imagine the condemnation that the U.S. government would suffer if faced with something similar. Imagine the spectacle, say, of a few thousand secessionists gathered in the same nonviolent civil disobedience that Gandhi, following Thoreau, used to “liquefy”105 the British Empire. Imagine troops rolling in and dragging off the protestors one by one, each clutching a copy of the Declaration of Independence, with cable news broadcasting the scene around the world. Can one possibly believe that in light of such a blatant act of hypocrisy the U.S. government could weather the resultant loss of whatever moral authority it still pretended to have? From his command post in the bowels of the White House, what would the president say to the nation and the world? What could he say? “We have no choice but to use military force against this unwarranted attack on America”? “We must once again preserve the Union at the expense of the principle upon which it was founded”? “If we in Washington allow these people to secede, we will soon find ourselves out of a job and will then have to survive, like them and the rest of you, on the economic means”?

But of course the American state, like any state, is inherently devoid of moral authority and so has no recourse but to the aggression that creates and sustains it, the only question being when, not whether, one or more of its constituent states calls its bluff. It is only a matter of time, that is, before one or another of them (probably Alaska or Texas) takes matters into its own hands and the third American Revolution—if the Civil War is rightly counted as the (unfortunately failed) second106—is underway.

105 See Rohan Jayetilleke, “Mahatma Gandhi, with a fistful of ‘SALT,’ liquefied the British Empire,” here: chilaw-and-gandhi.tripod.com/id13.html 106 Not to condone slavery in any way, the fact is that ending it was never the real issue. As Donald W. Livingston writes in “A Moral Accounting of the Union and the Confederacy,” The Journal of Libertarian Studies, Volume 16, no. 2 (Spring 2002), pp. 57– 101: “Had the British invasion of the colonies, or the Northern invasion of the Confederacy, been launched with the intention of eliminating slavery, they might have had some appearance of morality. But neither invaded for that purpose. The British were still engaged in the slave trade, and the Northern-dominated Congress (with Lincoln’s support) passed an ironclad amendment to the Constitution protecting slavery forever in the States where it was legal. If the Southern states had stayed in the Union, slavery would have lasted until they saw fit to abolish it.”

In point of fact, the U.S. has a long history of secessionist movements,107 not to mention that one of the 20th century’s most prominent American diplomats108 decried the nation’s excessive size and the attendant loss of intimacy between the people and their government, stating flatly that the United States had long ago become ungovernable democratically and proposing that it be broken up into nine regional and three urban republics.109 A process that, once begun, would likely be unstoppable, it is all but inevitable that as the present crisis worsens, one or more states will vote to secede. And with the whole world watching, it will be impossible for Washington to stop them, just as it will be impossible for it to stop the rest of the states from following suit.

Moreover, while some assume that as a result of the collapse of the American state the world would “belong to Russia and China,”110 it is far more likely that the American state’s collapse will set off a worldwide “devolution revolution” that no state will be able to withstand, as emboldened bodies politic and sympathetic international spectators frustrate government efforts to suppress secessionist uprisings.

And while the aftermath of the U.S. government’s collapse will obviously be a tumultuous time (though no more so than the coming HyperDepression), comfort can be taken in the fact that what began as a federation of sovereign states can return to that sovereignty, doing so with much less socioeconomic turmoil than that which followed the Soviet collapse. For the American states are in a much better position to govern themselves than their Soviet counterparts were, the latter lacking the institutional framework to do so, while the former are sufficiently institutionalized (if overly bureaucratized) to carry on the business of government. Thus, as order returns within and among the sovereign states, the devolution of power will be able to continue such that, in Tennyson’s words, “Freedom slowly broadens down/From precedent to precedent,”111

107 See Wikipedia, “List of autonomist or secessionist movements / United States,”

here: en.wikipedia.org/wiki/List_of_historical_autonomist_and_secessionist_movements #United_States.

108 See Wikipedia, “George F. Kennan,” here: en.wikipedia.org/wiki/George_F._

Kennan.

109 George F. Kennan, Around the Cragged Hill: A Personal and Political Philosophy, W.W.

Norton and Company, 1993, Chapter 7.

110 See J. R. Nyquist, “Chaos, Confusion, and Civil War,” February 13, 2009, here: www.financialsense.com/stormwatch/geo/pastanalysis/2009/0313.html 111 “You Ask Me Why,” online version here: tennyson.classicauthors.net/PoemsOfAlfredLordTennyson/PoemsOfAlfredLordTennys on13.html GOLD, THE GOLDEN RULE, AND GOVERNMENT 31
and free territories—consisting entirely of sovereign individuals—begin to emerge.

11. The Governance of a Free Society

That government is best which governs not at all. —Henry David Thoreau

Because the state is by its nature inimical to the social enterprise, we make a distinction between government and governance. We distinguish, that is, between an overarching entity on the one hand and an underlying process on the other, answering Thoreau’s question by saying that the next step “towards recognizing and organizing the rights of man” will be taken via the latter— i.e., via the return to a process of customary law that is self-organizing and thus precludes the positivist regimentation of a state. And as no better or more thorough examination of the subject can be found than in the extraordinary collection of essays noted here,112 it is clear that however controversial stateless governance might be, the issue cannot be resolved until the state is weakened to the point that it is unable to prevent the necessary experimentation, including that which is based on the implementation of an actual social contract.

While “the view that persons’ moral and/or political obligations are dependent upon a contract or agreement between them to form society,”113 the fact is that no such contract has ever existed. For as we have seen, even though the golden rule has formed the basis of social governance for millennia, the state has relentlessly intervened, positivizing and thus perverting it, first through conquest and subjugation, then through the systematic confiscation of taxation.114 Thus is the question raised as to whether a real social contract—i.e., one based on “an exchange of promises for the breach of which the law will provide a remedy”115—might provide the means for genuine consent to prevail and thus for the process of civilization

112 Edward P. Stringham, Editor, Anarchy and the Law: The Political Economy of Choice, Transaction Publishers, 2007; see book description here: www.mises.org/store/Anarchy—and-the-Law-P335.aspx.

113 See The Internet Encyclopedia of Philosophy, “Social Contract Theory,” here: www.iep.utm.edu/s/soc-cont.htm#H2.

114 While a small fraction claims to pay its taxes voluntarily, based on the time-honored, if patently false, belief that “taxes are the price we pay for a civilized society” (see Wikipedia entry on Oliver Wendell Holmes here: en.wikipedia.org/wiki/Oliver_Wendell_Holmes,_Jr), it is highly doubtful that such people would pay any taxes at all (see the Lysander Spooner passage referenced in footnote 84) were they indeed voluntary.

115 See Wikipedia, “Contract,” here: en.wikipedia.org/wiki/Contract.

to unfold without a state. That is, rooted in the negative golden rule, and thus the non-aggression principle, the question arises as to whether the signing of such a contract, being required of every incoming member of society, could adequately serve as the legal basis of a free society.116 If so, then free territories could advance as states receded, with no end to the process until states were completely eradicated and free territories were merged into a worldwide continuum of freedom.

As intriguing as this possibility might be, however (and again, only experimentation can make that determination), the matter of security remains

116 Here is a sample: I, (name in full), hereby affirm my agreement that all human beings are endowed with certain absolute rights; that these rights are to life, liberty, and property; that all human beings should be equal under the law with respect to these rights; that individuals cooperate among themselves to secure them; and that they do so freely and of their own accord.

Therefore, as a mentally competent adult over the age of 18, I hereby agree to the terms of this contract for citizenship in the Free Territory of __________ on my own behalf as well as that of my minor dependents—consenting to be guided in my affairs by the Ethic of Reciprocity, which I state as follows: I will not do to any other citizens of _______ what I would not want them to do to me. Beyond so restricting my actions, it is agreed by my fellow members of _______ that I am free to conduct my affairs as I please, engaging in such activities with my fellow members as may be mutually agreed upon, either formally or informally.

Furthermore, insofar as I might accuse others members of violating my absolute rights or others might accuse me of violating theirs, I agree to conflict resolution under the auspices of a firm chosen by lot from a list of at least three such firms, each of which must be approved by the Association for Conflict Resolution. I also agree that should the parties enter into arbitration, the loser must pay the legal fees of both parties; that insofar as either party refuses arbitration, the protections afforded that party by his citizenship are forfeit; that the forfeiting party is thereby placed in a state of nature vis-à-vis the citizens of _________, who are thereby entitled to take such actions as they deem necessary to resolve the dispute.

Lastly, it is understood by all citizens of _________ that I have the absolute right to cancel my citizenship at any time for any reason and that, should I in fact choose to do so, I will submit my cancellation in writing, recording it so as to be available for examination and verification by the citizens of _________.

Signed this _____ day of ___________, in the year ______ of the Common Era, as witnessed below by (name in full), who, as a citizen in good standing of ________, has signed a replica of this document, both of which are available for examination and verification by any other citizen of _________.

Signature of witness _____________________________

to be addressed, not least because, far from a continuum of freedom, the interregnum of the state must be contended with.

12. Security in a Free Society

The real choice isn’t between liberty and security; it is between our security and the state’s. —Llewellyn Rockwell117

While the state pretends to protect the people from external threats, it is in fact the instigator thereof, the more so the larger the state is. Which is to say, the state does not provide security. Rather, it creates the need for security and promptly fails to provide it, using its monopoly powers to assure that the more it spends—now over three-quarters of a trillion dollars a year in the United States118 and well over half of worldwide military spending as a whole119—the less security it provides. Thus was the finally “successful” attack on the World Trade Center mere blowback120—i.e., the all but inevitable response of those victimized by the U.S. government’s decades-long intervention in the Middle East. And not surprisingly, as a consequence of this “unprovoked” attack, the U.S. government has vastly expanded its intelligence apparatus, seeking nothing less than “Total Information Awareness”121 (since renamed following an “adverse media reaction to the program’s implications for public surveillance”),122 while making “preemptive” war a key component of its foreign policy, the rationale for which is laid out in the former Bush administration’s “National Security Strategy of the United States of America.”123 (And protestations to the

117 See Llewellyn H. Rockwell, Jr., “The Real Meaning of Security,” at LewRockwell.com here: www.lewrockwell.com/rockwell/real-security.html.

118 See Global Issues, “World Military Spending,” here: www.globalissues.org/article/75/world-military-spending#WorldMilitarySpending.

119 Ibid.

120 In his book [Blowback: The Costs and Consequences of American Empire], Chalmers Johnson wrote, “The term ‘blowback,’ which officials of the Central Intelligent Agency first invented for their own internal use, … refers to the unintended consequences of policies that were kept secret from the American people. What the daily press reports as the malign act of ‘terrorists’ or ‘drug lords’ or ‘rogue states’ or ‘illegal arms merchants’ often turn out to be blowback from earlier American operations.” —The Independent Institute’s Center on Peace & Liberty: www.onpower.org/foreign_blowback.html 121 See Wikipedia, “Information Awareness Office,” here: en.wikipedia.org/wiki/Information_Awareness_Office.

122 Ibid.

123 See official online version here: www.globalsecurity.org/military/library/policy/national/nss-020920.pdf 34 LIBERTARIAN PAPERS 1, 32 (2009)

contrary, the Obama administration has been only too willing to pick up where its predecessor left off.124) Yet such is the twisted logic of the state that the solution to the endless warring between and among them—and let us be clear, “The connection between kinship and family, between religion and church, is no closer than that between war and the State”125—is to have but one state: Thomas Hobbes, and countless political philosophers and economists after him, argued that in the state of nature, men would constantly be at each others’ throats. Homo homini lupus est [Man is a wolf to man]. Put in modern jargon, in the state of nature a permanent “underproduction” of security would prevail. Each individual, left to his own devices and provisions, would spend “too little” on his own defense, resulting in permanent interpersonal warfare. The solution to this presumably intolerable situation, according to Hobbes and his followers, is the establishment of a state. …

… Once it is assumed that in order to institute peaceful cooperation between [individual] A and [individual] B it is necessary to have a state S, a twofold conclusion follows. If more than one state exists, S1, S2, S3, then, just as there can be presumably no peace among A and B with S, so can there be no peace between S1, S2, and S3 as long as they remain in a state of nature (anarchy) with regard to each other. Consequently, in order to achieve universal peace, political centralization, unification, and ultimately the establishment of a single world government, are necessary.126

While a single world government—a world state—has long been and is now the even more fervent hope of both neoliberals (socialists) and neoconservatives (fascists), it should be clear from the foregoing that a world state would be the worst possible development for humanity. True, it would theoretically bring an end to the state of nature among nations and thus put an end to war. But given the nature of the state, this would in practice amount to a “final solution” for human freedom. For in the universal bureaucratization of all human action, the administrative state would be complete, and society, even more than it does now, would exist only insofar as it could generate enough wealth to keep the global apparatus of compulsion and coercion functioning. That it could not do so for long would be but the inevitable effect of the cancer devouring its host, and from

124 See, for example, MSNBC World News here: www.msnbc.msn.com/id/29242187.

125 Ibid., Nisbet, p. 91.

126 Ibid., Hoppe, pp. 239 and 241.

society’s rotting corpse, warring states would inevitably reappear, if indeed they could ever be reduced to the compliant status (for now, at least) of the constituent American states.

Moreover, we must confront the further fact that collective security is a one-sided affair that is entirely at odds with the interests of those supposedly being protected. After all, “no one in his right mind would agree to a contract that allowed one’s alleged protector to determine unilaterally—without one’s consent—and irrevocably—without the possibility of exit—how much to charge for protection.”127 Yet as this is precisely what the state imposes on its subjects, it should be no surprise that the cost of security, as noted above, increases in inverse proportion to the security actually provided.

Clearly, then, security is not to be found in the state. And while some contend, as the nature and origin of the state would seem to bear out, that without a state, “stronger agents will be tempted to use force against the weak and impose government on them,”128 our contention, as outlined above, is that the collapse of the flagship American state will so discredit the state per se that the extent to which people will submit to it at all will be brought into question. For again, with the whole world watching, predatory groups will have to stand trial in the court of public opinion. And being found guilty, they will find it very difficult, if not impossible, to impose their will on others, at least for long. Thus, as the devolutionary process challenges the moral authority of smaller and smaller states—which will be constrained in direct proportion to their increasing “feebleness”129—society will turn elsewhere for security: namely, to the market.

How?

Mostly likely via the insurance industry. For “even now insurance agencies protect private property owners upon payment of a premium against a multitude of natural and social disasters, from floods and hurricanes to theft and fraud.”130 All are forms of security, after all, so why should “defense” be any different, especially since insurance companies are very large, far-flung affairs that are

127 Ibid., Hoppe, pp. 279 and 280.

128 Ibid., Stringham, p. 373.

129 “History tells us that while small States are virtuous because of their feebleness, powerful States sustain themselves only through crime.” —Mikhail Bakunin, “Ethics: The Morality of the State,” as excerpted here— flag.blackened.net/daver/anarchism/bakunin/bakunin1.html—in The Political Philosophy of Bakunin, The Free Press, New York, 1953, by G. P. Maximoff.

130 Ibid., p. 281.

… in command of the resources—physical and human—necessary to accomplish the task of dealing with the dangers, actual or imagined, of the real world. Indeed, insurers operate on a national or even international scale, and they own substantial property holdings dispersed over wide territories and beyond the borders of single states and thus have a manifest self-interest in effective protection.

Furthermore, all insurance companies are connected through a complex network of contractual agreements on mutual assistance and arbitration as well as a system of international reinsurance agencies representing a combined economic power that dwarfs most if not all contemporary governments, and they have acquired this position because of their reputation as effective, reliable, and honest businesses.131

And again, with the collapse of the monster states, the monstrous threat that they present to the world will decline proportionately, reducing security insurance to something more in line with the mundane tasks to which everyone is already accustomed, the reason being that “defense” insurance will have the same market-based advantages of other insurance:

First off, competition among insurers for paying clients will bring about a tendency toward a continuous fall in the price of protection (per insured value), thus rendering protection more affordable.

Second, insurers will have to indemnify their clients in the case of actual damage; hence they must operate efficiently…

Third, and most importantly, because the relationship between insurers and their clients is voluntary, insurers must accept private property as an ultimate “given” and private property rights as immutable law. … Moreover, out of the steady cooperation between different insurers in mutual interagency arbitration proceedings, a tendency toward the unification of the law—of a truly universal or “international” law—will emerge.132

Security, then, will ultimately be a purely individual affair, no matter if “group” insurance is the manner in which it is provided. Either way, the decision will be individual, the payment will be individual, and the benefit will be individual, with no state dictating the price of that benefit while failing to provide it.

In the meantime, the reduced threat to the American states from the collapse of their central government will allow them to make a generally

131 Ibid., p. 281.

132 Ibid., pp. 281, 282, and 283.

peaceful transition to independence. After all, the violence that is being directed at America today, even though it targets civilians, has but one objective and that is to topple the American government. That is, what al-Qaida and others want to see happen to the United States is simply what America wanted to see happen to the former Soviet Union—i.e., they want its central government to fall. And it is as ludicrous to think that al-Qaida would attack America after its central government had collapsed as it would have been to think that America would have attacked the Soviet Union after its central government had collapsed.

And thus are we left to contemplate what is really afoot as the interregnum of the state finally draws to a close.

13. The End of History

There is properly no history, only biography. —Ralph Waldo Emerson

Following the collapse of the Soviet Union, it was proclaimed that what we were likely witnessing was

…not just the end of the Cold War, or the passing of a particular period of postwar history, but the end of history as such; that is, the end point of mankind’s ideological evolution and the universalization of Western liberal democracy as the final form of human government. 133

In reality, however, what we are witnessing is the ideological exhaustion of Western liberal democracy and therefore the ideological exhaustion of the state per se. For in exposing the fraud of liberal democracy’s flagship American state, it is clear that such a state is fundamentally no different than any other state. No longer able to hide behind the Jeffersonian dream of constitutional freedom and order or the Lincolnian myth that the American ideal could be preserved at the expense of the principle upon which it was founded, the American state’s demise is bringing us face-to-face with the moral vacuity of Western liberal democracy and the nihilism of the lament that its universalization “will be a very sad time.”

The struggle for recognition, the willingness to risk one’s life for a purely abstract goal, the worldwide ideological struggle that called forth daring, courage, imagination, and idealism, will be replaced by

133 Francis Fukuyama, “The End of History?” The National Interest, Number 16, Summer 1989, p. 4.

economic calculation, the endless solving of technical problems, environmental concerns, and the satisfaction of sophisticated consumer demands.134

How sad, in other words, that if people were in fact freed from “the worldwide ideological struggle” (though of course they have not been), they would at long last be able to live in the company of their fellows, ordering their lives through free and voluntary cooperation with them. How sad that without “the struggle for recognition,” people would not have to endure another Pharoah, Caesar, Alexander, Napoleon, Hitler, Stalin, Lincoln, Roosevelt, Clinton, Bush, or Obama and would instead be left to while away the hours in the peaceful pursuit of their own happiness. How sad that without the “purely abstract goal” of one or another statist ideology, grandparents, parents, spouses, children, and grandchildren would not know the “daring, courage, imagination, and idealism” that sends their loved ones home in body bags and prostheses. How sad that “environmental concerns” could actually be solved—through the market-based protection of life, liberty, and property135—rather than perpetrated by governments136 and perpetuated by their bloated “regulatory” agencies. And how sad that “economic calculation and the endless solving of technical problems”—i.e., the day-by-day work of an increasingly complex and thus more richly rewarding world—would not be complicated by relentless government intervention.

Yes, there is the hope that “centuries of boredom at the end of history will serve to get history started once again,”137 so that murder and mayhem can return to spice up the dreary “satisfaction of sophisticated consumer demands.”138What is a cell phone, after all, compared to a land mine? What is communication compared to mutilation? With “no struggle over ‘large’ issues and consequently no need for generals or statesmen,”139 how much attraction can life hold? What’s the use of living, in other words, if you can’t make a killing killing people?

134 Ibid., p. 18.

135 See, for example, Art Carden, “Economic Calculation in the Environmentalist Commonwealth,” at the Social Science Research Network, here: papers.ssrn.com/sol3/Papers.cfm?abstract_id=1392412

136 It should come as no surprise that the U.S. Department of Defense “is the largest polluter in the world, producing more hazardous waste than the five largest U.S. chemical companies combined.” See CommonDreams.org here: www.commondreams.org/views05/0327-21.htm 137 Ibid.

138 Ibid.

139 Ibid., p. 5.

And a twofold killing it is—over 15 billion people “since the beginning of authentic history,” at a cost of over a thousand trillion dollars140— according to the research published in a 1914 New York Times piece141 that also makes the following observation: Brilliant deeds on the battlefield are done by the man who will take the greatest risks in support of an ideal; the man who will take the greatest risks is, ordinarily, the best of men. So these are least likely to escape. …

… And even though large numbers of the best of men are left, many are destroyed, and of those remaining many have been deteriorated physically by the effort, by the wounds, by the diseases, of wartime; while the economic course of every man participating in a war is interrupted by his service, and, in the majority of cases, such an interruption harms his industrial or professional or mercantile future, thus directly affecting the opportunities that he may offer to the rising generation, which, for a time, depends upon him.

And thus does the killing of the best in war also kill “a certain portion of the incalculable social and educational effort of the ages.”142

But no matter. For as war is its very health143—first it profits from murder and mayhem, then from cleaning up the mess144—the state will have a war if it wants one, never mind how much the people, understandably, do not: Why, of course the people don’t want war. Why would some poor slob on a farm want to risk his life in a war when the best that he can get out of it is to come back to his farm in one piece. … But after all, it’s the leaders of the country who determine the policy, and it’s always a simple matter to drag the people along whether it’s a

140 Inflation-adjusted as follows: 15 billion battlefield deaths x $3,677 per death in 1914 dollars (see footnote 138) x 20 to correct for the dollar’s lost purchasing power since then (see here: www.csamerican.com/stuff.asp?k=25) = $1,103,100,000,000,000.

141 See photocopy of the original September 13 article here: query.nytimes.com/mem/archive— free/pdf?_r=2&res=9C04E0DC1638E633A25750C1A96F9C946596D6CF

142 Ibid.

143 See Randolph Bourne, “War Is the Health of the State,” here: flag.blackened.net/revolt/hist_texts/warhealthstate1918.html 144 Yes, there are losers, but only in the sense of a corporation whose products poison its customers, punishment for which doesn’t result in compensating the customers’ families and putting the corporation out of business. Rather, the corporation’s managers are simply replaced, there being no mechanism (no market) whereby the existence of the corporation itself—i.e., the state—can be questioned. Thus can it poison again with impunity. And so it will.

democracy, a fascist dictatorship, or a parliament, or a communist dictatorship. Voice or no voice, the people can always be brought to the bidding of the leaders. That is easy. All you have to do is tell them they are being attacked, and denounce the pacifists for lack of patriotism and exposing the country to greater danger. It works the same in any country. 145

But why? The answer is as old as Plato’s Dorians: [I]t is immaterial for the citizens of any nation where the frontiers of their country are drawn. It is of no concern for anyone whether his country is big or small, and whether it conquers a province or not.

The individual citizens do not derive any profit from the conquest of a territory.

It is different with the princes or ruling aristocracies. They can increase their power and their tax revenues by expanding the size of their realms. They can profit from conquest. They are bellicose, while the citizenry is peace loving.146

They will object, of course, that they are not bellicose at all and only want to increase their power in order to be of greater service to society. They are “public servants,” after all, seeking only to do good on the public’s behalf. What they do not understand, however—what they dare not even contemplate—is that because “Men are cruel, but Man is kind,”147 no men are more cruel than those who would do good with mankind’s money—with the proceeds, that is, of legalized theft. For as easy as it is to make theft legal, it is impossible to make it moral, the resulting corruption being all the worse for the pretence upon which it is based: that such theft is the price that must be paid for a civilized society.

And it is because of this vast charade—the biggest of all big lies148— that its perpetrators fail to realize that they are but the latest incarnation of the iniquity that has prevailed from time immemorial; that however much the forces of history have been debated over the centuries—are they blind, cyclical, progressive, eschatological, dialectical, etc.—there are actually no forces of history at all, there is only the history of force; and that, indeed, there is only history as force, the absence of which is not history but

145 Nazi Reichsmarschall Hermann Goering; see WikiQuote here: en.wikiquote.org/wiki/Hermann_Göring; additional background here: answers.google.com/answers/threadview/id/235519.html 146 Ibid., Mises, “The Economic Causes of War,” The Freedman, 2004, p. 10, as excerpted from a lecture given in Orange County, California, October 1944; online version here: www.fee.org/pdf/the-freeman/mises0404.pdf 147 Rabindranath Tagore, “Stray Birds,” 219.

148 See Wikipedia, “Big Lie,” here: en.wikipedia.org/wiki/Big_Lie GOLD, THE GOLDEN RULE, AND GOVERNMENT 41
biography—the ability to graph, as it were, one’s own bio and thereby live as a full-fledged member of society.

Its perpetrators do not understand, that is, that their role in history is history, for history is nothing more than the biographies of those who have used the political means to expropriate the fruit of the economic means, the producers of which have had their biographies expropriated accordingly. As such, history is merely a chronicle of conquest, subjugation, and confiscation, and therefore of perpetual war for perpetual war. And just as war and the state are one, so, then, are the state and history one.

Therefore, the end of the state will be the end of history.

14. The Final Form of Human Government

Man is not only the most individual being on earth; he is also the most social being.

—Mikhail Bakunin

As Donne reminds us, “No man is an island,”149 at least if he would attain to the order, the harmony—that “pleasing combination of the elements”—for which he naturally yearns. Alone against those elements, man is as nothing, scratching out an existence unfit for his kind and indeed destructive of it, selfless because, in having no others with which to associate, no true self exists. But in that convivium—that “living together”—a self emerges, or at least the reflection of a self, into which he can gaze and through which he can begin not only to act but to act human, the goal of which “is always the satisfaction of the acting man’s desires.”150 And that, as we have said, is the source and sustenance of the social enterprise: Society is concerted action, cooperation … the outcome of conscious and purposeful behavior. … Individual man is born into a socially organized environment. In this sense alone we may accept the saying that society is—logically and historically—antecedent to the individual. In every other sense this dictum is either empty or nonsensical. The individual lives and acts within society. But society is nothing but the combination of individuals for cooperative effort.151

149 See John Donne, “Meditation XVII,” here: www.luminarium.org/sevenlit/donne/meditation17.php.

150 Ibid., Mises, Human Action, p. 14.

151 Ibid., p. 143.

In seeing that it was out of this cooperative effort that civil society’s central organizing principles—money and law—evolved, it is clear that in order for “the final form of human government” to indeed be final, gold and the golden rule must be reestablished as the twin pillars of civilization.152 They must be returned to their rightful owners, that is, leaving us with one last question so far as social governance is concerned. For in debunking the state, including and especially the democratic state, it would appear that we have debunked democracy as well, and that the collapse of the democratic state therefore means the death of democracy. On the contrary, however, the collapse of the democratic state will mean the birth of genuine democracy. For as the mechanism whose modus operandi is compulsion and coercion is displaced by the organism whose modus vivendi is voluntary cooperation, democracy in the form of majority rule will give way to democracy in the form of individual rule. That is, the individual, as a sovereign unto himself, will rule over himself, the devolutionary process rendering the fraud of representative democracy null and void as it gives way to a fully participatory democracy grounded in a negative—i.e., non-interventionist—rule of law.

It will be market democracy, in other words, and while everyone will not have the same number of “votes”—i.e., the same amount of purchasing power—the tendency will be in this direction, as the enormous, state-induced disparities between rich and poor narrow over time—even as vastly more wealth is created—and society moves toward a state of dynamic equilibrium that is steady not because it doesn’t change but because it changes steadily, spontaneously generating more and more order and doing so without limit.

Will it be utopia? Yes, and emphatically so, for the simple reason that “Utopianism is compatible with everything but determinism,”153 which is to say, it is compatible with everything but the state. And as the state is

152 The reestablishment of money, however, will be in technologically advanced form, such that real assets will be exchanged instantaneously and with complete financial privacy: “In the future, trade will be executed by instantaneous and simultaneous debiting and crediting to and from liquid wealth accounts, held by both banking and nonbanking institutions. Electronic digital payments technology will enable property rights claims on real assets, such as stock and bond funds, or gold, to be utilized as the medium of exchange for virtually all transactions. In sum, when businesses or individuals wish to purchase a good or service, they will provide—directly or indirectly—an electronic instruction to their bank or other financial intermediary. The instruction will state that an amount equal to the nominal value of the purchase should be transferred immediately to the account of the seller of the good or service [and]…send ‘money’ from one point to another point on the globe extraordinarily fast and anonymously.” — Richard W. Rahn, “Money: The Ultimate Privatization”: www.cipe.org/publications/ ert/e32/e32_2.pdf 153 Ibid., Nisbet, p. xxxi.

eradicated, we can therefore expect utopia—”nowhere”—to appear first here, then there, in this form and that, at once experimental and experiential, until it is everywhere, evolving as one, under the direction of no one and everyone at the same time, and doing so, again, without limit: Since man is always acting, he must always be engaged in trying to attain the greatest height on his value scale, whatever the type of choice under consideration. There must always be room for improvement in his value scale; otherwise all of man’s wants would be perfectly satisfied, and action would disappear. Since this cannot be the case, it means that there is always open to each actor the prospect of improving his lot, of attaining a value higher than he is giving up, i.e., of making a psychic profit.”154

How much “psychic profit” is humanity capable of generating? If there “must always be room for improvement in his value scale,” how much room can man, in that convivium, make? Given that he does not live by bread alone, in other words, how far beyond bread can man live? How far “beyond the margin of subsistence” can he in fact go?

Let us close with an answer that could well be as probable as it is seemingly impossible.

15. Concluding Scientific Postscript155

A man said to the universe,”

“Sir, I exist!”

“However,” replied the universe,

“The fact has not created in me

A sense of obligation.”

—Stephen Crane

For all his striving, man pales in significance to the cold immensity of the universe. Our sun, after all, is but one of somewhere between 200 billion and 400 billion suns in our galaxy, a “stellar disk” that is estimated to be around 100,000 light-years across.156 Given that a single light-year is a distance of some 5.9 trillion miles,157 this means that our galaxy spans a

154 Ibid., Rothbard, Man, Economy, and State, p. 62.

155 The reference is to Soren Kierkegaard’s “Concluding Unscientific Postscript to Philosophical Fragments.” See Wikipedia here: en.wikipedia.org/wiki/Concluding_Unscientific_Postscript 156 See Wikipedia, “Observable universe,” here: en.wikipedia.org/wiki/Observable_universe 157 See Wikipedia, “Light-year,” here: en.wikipedia.org/wiki/Light-year 44 LIBERTARIAN PAPERS 1, 32 (2009)

distance of nearly 600 quadrillion158 miles. Even so, it is but one of at least 125 billion galaxies in the universe (and possibly four times that amount),159 which is estimated to be 156 billion light-years wide and contain some 1080 atoms.160

The universe is also old, between 13.5 and 14 billion years,161 as is the Earth, at roughly 4.5 billion years,162 and life upon it, at around 3.7 billion years.163

Not so, however, for our species, homo sapiens, which is estimated to have made its appearance less than 200,000 years ago164—a mere 54 millionths of the time life has existed on the planet, 44 millionths of the time the planet itself has existed, and 15 millionths, at most, of the time the universe has existed.

Moreover, for the vast majority of that time, homo sapiens lived as a simple hunter-gatherer, not taking up agriculture until around 10,000 years ago165 and progressing all but imperceptibly from that point on until the onset of the Scientific Revolution around the middle of the 16th century166 and the Industrial Revolution in the late 18th century.167 Yet as a result of this recent quickening, homo sapiens now finds itself, at the beginning of the 21st century, riding a tide of technological progress that shows no signs of abating.

Before we examine it further, however, let us reconsider our statement above that “man pales in significance to the cold immensity of the universe.”

158 See “Names for Large Numbers” here: www.unc.edu/~rowlett/units/large.html 159 According to a 1999 estimate by the Hubble Space Telescope; see NASA Goddard Space Flight Center here: imagine.gsfc.nasa.gov/docs/ask_astro/answers/021127a.html 160 See footnote 147, a number that can also be expressed as 100 quinvigintillion; see footnote 149.

161 See Wikipedia, “Age of the universe,” here: en.wikipedia.org/wiki/Age_of_the_universe.

162 See Wikipedia, “Age of the Earth,” here: en.wikipedia.org/wiki/Age_of_the_Earth.

163 See Wikipedia, “Life/Origin,” here: en.wikipedia.org/wiki/Life#Origin_of_life.

164 See EureAlert, “The oldest homo sapiens,” here: www.eurekalert.org/pub_releases/2005-02/uou-toh021105.php.

165 See Wikipedia, “Human/Origin,” here: en.wikipedia.org/wiki/Human#Origin.

166 See Wikipedia, “Scientific Revolution / Emergence of the revolution,” here: en.wikipedia.org/wiki/Scientific_Revolution#Emergence_of_the_revolution.

167 See Wikipedia, “Industrial Revolution,” here: en.wikipedia.org/wiki/First_Industrial_Revolution.

According to an ancient (originally Latin) apothegm, “There is nothing greater in nature than man, and there is nothing greater in man than mind.” If so, then just how great is man’s mind, at least potentially?

If each human brain had only one synapse—corresponding to a monumental stupidity—we would be capable of only two mental states. If we had two synapses, then 22 = 4 states; three synapses, then 2 = 8, and, in general for N synapses, 2N states. But the human brain is characterized by some 1013 synapses. Thus the number of different states of a human brain is 2 raised to this power—i.e., multiplied by itself ten trillion times. This is an unimaginably large number, far greater, for example, than the total number of elementary particles (electrons and protons) in the entire universe, which is much less than 2 raised to the power 103. … [Therefore]

there must be an enormous number of mental configurations that have never been entered or even glimpsed by any human being in the history of mankind.168

Indeed there must, “enormous” hardly doing justice to the literally astronomical number of configurations of which the human mind is capable or the creative power that could be contained in any number of those configurations. Surely the greatest minds in human history—Confucius, Plato, Aristotle, Shakespeare, Leonardo, Newton, Beethoven, Einstein, to name an obvious few—would pale in comparison to a mind that approximated its true potential, the question being how it would do so. After all, the minds of these men are as rare today as they ever were, and there is scant evidence of vastly more powerful minds suddenly making their appearance.

Or is there? And are we poised instead on the threshold of something akin to the appearance of humanity itself, or even of life itself? With every passing day, after all, the otherwise immovable object of the state is being pushed farther aside by the irresistible force of technology—technology that is today represented most notably by the Internet: In the Internet we see our greatest hope for freedom and for the continual progress of humanity. In the Internet we see the anachronistic and obsolete institutions of society being pushed aside for a new dawn of better things. In the Internet we see the key to diminishing the power and status of the state and liberating ourselves from its oppression and deception.169

168 Carl Sagan, The Dragons of Eden: Speculations on the Evolution of Human Intelligence, Random House, New York, 1977, p. 42.

169 See Eric Garris, “The Internet vs. the State,” here: www.lewrockwell.com/orig/garris3.html.

Indeed we do. For it is nothing less than the great and growing power of cooperation in the form of social networking,170 the vast potential of which is only just now being tapped and against which the state will be all but powerless. And insofar as it played a role in the creation of the Internet,171 the state only helped to create a monster that, unlike itself, is overwhelmingly a force for good,172 and one that is growing exponentially.173

But it is not just the Internet, as other technologies are also empowering humanity as never before, so much so that they are bringing man and machine together in ways that boggle the mind as much as the mind’s own potential does: An analysis of the history of technology shows that technological change is exponential, contrary to the commonsense ‘intuitive linear’

view. So we won’t experience 100 years of progress in the 21st century—it will be more like 20,000 years of progress (at today’s rate). … Within a few decades, machine intelligence will surpass human intelligence, leading to … technological change so rapid and profound that it represents a rupture in the fabric of human history.

The implications include the merger of biological and nonbiological intelligence, immortal software-based humans, and ultra-high levels of intelligence that expand outward in the universe at the speed of light.174

However much one might be inclined to dismiss such notions as mere fantasy, the above analysis is based on well-established trend extrapolation,175 the continuation of which all but assures that in the relatively near future, some kind of “rupture” will indeed occur. If so, then one has to wonder if Stephen Crane didn’t get it backwards and that his poem should read as follows:

170 See YouTube video clip, “Social Networking in Plain English,” here: www.youtube.com/watch?v=6a_KF7TYKVc 171 ARPA, let us be clear (see Wikipedia here: en.wikipedia.org/wiki/Internet#Creation), was a competitive enterprise, however perversely so, in that it was part of early Cold War efforts to conquer—i.e., weaponize— space.

172 No technology is inherently good and can always be used for evil purposes. But that is the chance humanity takes with any technology, those developed by the state—e.g., nuclear weapons—tending by far to be the most dangerous.

173 See LivingInternet.com, “Internet Growth Rates,” here: www.livinginternet.com/i/ip_growth.htm.

174 See Ray Kurzweil, “The Law of Accelerating Returns,” here: www.kurzweilai.net/articles/art0134.html?printable=1

175 Generally based on Moore’s Law; see Wikipedia here: en.wikipedia.org/wiki/Moore’s_law.

The universe said to a man,

“Sir, I exist!”

“And that fact,” replied the man,

“Has created in me

A sense of obligation.”

An obligation to what? To merely do what comes natural to him, based on his intuitive knowledge that insofar as being is, it is good, and that more being is therefore better, his own being standing at the forefront of a process of becoming that he is only just now beginning to grasp. And having dwelled long enough in that convivium that he can now look back with keen eyes on whence he came, so too can he now look forward to where he might be going.

Will he indeed transform himself into “ultra-high levels of intelligence that expand outward in the universe at the speed of light”? He does not know. What he does know, however, is that no transformation can take place as long as he is shackled in body and mind by the forces of nonbeing—i.e., by that which that has no other objective than to tie him down, hold him back, and otherwise deprive him of his humanity.

And now that he has seen it for what it is, let him put an end to it.

About this edition

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Title: Gold, the Golden Rule, and Government: Civil Society and the End of the State

Author: D. G. White

First published: 2009

Series: Libertarian Papers, volume 1

Licence: Licensed under Creative Commons Attribution 3.0. https://creativecommons.org/licenses/by/3.0/

Source file: Gold, the Golden Rule, and Government Civil Society and the End of the State.pdf

Source page: https://freecapitalists.org/books/gold-the-golden-rule-and-government-civil-society-and-the-end-of-the-state/

Converted: 2026-08-07 by The Liberty Archive (freecapitalists.org), converter v5

Table of Contents

- Chapter 5.20, here: www.econlib.org/library/Bastiat/basEss5.html.

- Chapter 5, “Social Power vs. State Power,” p. 5.

- Chapter 13, “The State and Antisocial Conduct,” here:

- Chapter 12, “The Trial of the Century that Never Was,” p. 178.