Point/Counterpoint: On Liberal Capitalism

This article is part of a Point/Counterpoint series. Click here to see the following response about Libertarian Socialism.


I hope to explain what libertarian capitalism is, and what anarcho-capitalism is. Government has two main aspects – extent and purpose. Extent – how much violence-power it wields – can be gauged by how much a government taxes, spends, incarcerates, and so on. Anarchists, by definition, reject all government violence-power in principle, preferring voluntary cooperation.

Anarchists believe that all the good things that government currently produces, such as courts, police, roads, and education, can be done better and more morally by voluntary society – “the market.” Anarcho-capitalists believe that private property (by entitlement, not decree) is generally the best way to solve the scarcity problem peacefully. This belief makes us “capitalist.” We favor out-competing government, not violent revolution, and work on projects such as private education (online learning) private money (crypto currency,) private courts, and private police firms. (Would citizens of Ferguson choose a belligerent all-white police patrol in a freed market with competing companies?)

Libertarian capitalists want an economy based on free markets and private property. Free markets, to us, mean no government intervention whatsoever – no subsidies, cartelizing regulations, or licensure. We make a clear distinction between market capitalists and crony capitalists. Like our libertarian socialist cohorts, we strongly oppose corporatism, which is collusion between government and favored “crony” firms. If government is involved, it is not libertarian capitalism.

Anarcho-capitalists are the radicals – we want no compulsory government whatsoever. More centrist libertarian capitalists are called “minarchists” since they want a minimal State limited to courts, police, and national defense. Redistribution and social engineering are not valid functions of government.

Libertarians see mainstream media as offering a false dichotomy between statist socialism and statist capitalism. Free market solutions are off their radar. To mainstream media, a treaty creating a trade cartel is a “free trade agreement!” Similarly, we are offered the choice between nationalized medicine and fascist medicine, with no mention of the free market alternative. Libertarians want people to consider voluntary alternatives to the “government gun.”

Some libertarian capitalist positions:

1) Anti-war and anti-imperialist. We oppose military intervention in foreign countries. Minarchists want a defense-only military, or no standing army at all. Anarcho-capitalists would rely for defense on insurance firms, guerrilla warfare, militias, and the lack of incentive to attack peaceful trading partners. Free markets create an automatic constituency for peace.

2) We are against neo-liberalism and other efforts of governments to control, regulate, or capture international trade. Trade should be voluntary, not enforced by governments. We oppose the corporatocracy; States should not be loan sharks to developing nations.

3) We are against corporatism. We think large corporations would mostly disappear in a freed market, lacking the government subsidies that give them advantages and create barriers for competition.

4) Employment is incidental to capitalism. It is fine so long as it is voluntary. We look forward to a time when everyone is an individual entrepreneur, cooperating with other producers as equal traders. (Here we disagree with libertarian socialists. We think employment is okay but sub-optimal; they think it is evil “wage slavery.”)

5) Anarcho-capitalists want voluntary society to prevail, and take over all (legitimate) functions that the state now does. Anarcho-socialists, our counterparts, concur.

Libertarianism, in essence, is about moving humanity away from the coercive rule of authorities, and toward a society where all activities are voluntary. Libertarian capitalists predict that, in a stateless society, many/most people will opt for some type of private property. Libertarian socialists think that many/most people will opt for some type of collective property. In a stateless society these wouldn’t conflict; there is ample scope for experimentation in freedom.

Most libertarians hold a non-aggression ethic – that one should not initiate force (violence) against others. Libertarians (as such) are not pacifists; we believe in self-defense, but the initiation of force is criminal. Most people agree with this non-aggression presumption in their personal lives, but statists give government a free pass. E.g. People who would never demand money from their neighbor at gunpoint, think nothing of voting for their government to do just that. Government, to statists, is above human morality. Libertarians, in contrast, hold everyone to the same moral standard.

Abel is a libertarian socialist, so he shares my belief in limited government. When he speaks against capitalism, keep in mind that he defines “capitalism” as only the statist type, corporatism. In past discussions he didn’t address libertarian capitalism at all. But listen to him! Libertarian socialists have a very good critique of statist capitalism. Libertarian capitalists agree with his analysis of capitalism perverted by government. We hate Pinochet and fascism, too. The kind of capitalism libertarian capitalists favor is no-government free market capitalism – the separation of economics and State.

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