I don't disagree that excessive centralization stifles economic activity. I also don't disagree that it's possible for markets, at least at some level of functionality, to operate without the involvement or perhaps even the existence of government(s). Furthermore, I agree that the economy of the United States would be better off with fewer laws, regulations, and taxes than it currently has.

However, I seriously doubt that totally eliminating all governments would result in greater economic activity and higher levels of prosperity and well-being for the inhabitants of the planet. That's a pretty hard case to make and the fact the some economic activity has occurred parallel to governments isn't adequately convincing.

I haven't yet read Leeson's essays, but since they're free, hopefully I'll get to it. Maybe those essays will convince me.

It may be that everybody would be better off if they each voluntarily respected property rights, upheld their ends of bargains and didn't go around killing people to take their stuff. But, all you need is one guy to decide "I have the bigger gun. I'm going to take what I want and nobody's going to stop me," and the whole system breaks up as others follow suit.

So, what happens? Well, everybody else gets together, decides "This isn't working. We need rules. And we need to kill that guy with the gun." So, they go capture him or lock him up or something, and scare others into following the rules.

And, that — a set of rules backed by a threat of force — is a government.

Now, I'll agree that we could do away with huge portions of the US government, and markets would still work. But, you can't get rid of things like common law (both civil and criminal) and a system to enforce it, the police and the military. Or, rather, you can get rid of those, but then you need to come up with substitutes.

Am late to the discussion that you kicked off.

I am with Don 100% on this. Free markets do not need government but they do need law.

A form of government that provides law but not intrusive government is Kritarchy.

"Kritarchy is a political system based on equal justice for all and the concept of natural rights. It differs from other political systems by its application of the rules of justice. Under kritarchy even courts of law, police forces and other organisations that look after the day-to-day business of maintaining law, are denied any power, privilege or immunity that is not in conformity with natural law. Every person is entitled to offer judicial or police-services to willing others; no person can be forced to become a client of any court of law or police force against his will. In short, under kritarchy judicial and police-services are offered on a free market, which is considered to be the natural law of the human world insofar as exchanges of goods and services are concerned."

The ancient Jews lived under Kritarchy successfully for centuries, but then got stupid and clamored for a King.

After the U.S. pulled out of Somalia in the early 1990s, instead of chaos, order emerged under Kritarchy and the ability of wartorn Somalia to prosper in peace amazed observors.

However:
The U.N and individual nations simply could not stand the thought of a nation not having a central government and have been operating doggedly to install a central government and war/conflict and poverty are returning to Somalia as the U.N. meddles in the internal affairs of Somalia.

Freer trade did not result in chaos or penury in Britain, as many people predicted — predicted would be the result of letting consumers make choices more freely and, hence, with less 'control' by the state.

Ending slavery and liberating peasants to work as free laborers according to terms of contracts — contractual terms dictated neither centrally nor by tradition — did not result in a chaotic labor market in which either workers were exploited or businesses found themselves unable to hire qualified workers.

Having money supplied privately in Scotland for much of the 18th and the 19th centuries did not result in out of control inflation or other monetary problems. (By the way, George Selgin, in his wonderful new book "Good Money" explains how private entrepreneurs, not the state, supplied small-denomination coins that were vitally important to commerce in the 19th century.)

Freeing people from central control of both the state and of many superstitions resulted in the wealth explosion that we call the industrial revolution. The complexity of society grew as central control receded.

Trade in the Mediterranean, even 1,000 years ago, was quite complex — involving insurance, complex financing arrangements, and creative credit instruments. By any measure, it was complex commmerce

Those are both interesting examples but they're addressing different questions than the one I asked (which were related to Rudy's statements). The example of Lex Mercatoria from one-thousand years ago is about a time where trade was much less complex and much slower (that's why I qualified my question with "complex markets like those typical in the west"). In the second example, it's true that modern international trade has no single sovereign power governing it. However it is absolutely and emphatically not true that there is no government involvement in supporting (or perhaps, in your view, hindering) that trade.

My point is not that trade is impossible without governments. Indeed, my belief is that trade preceded government by tens of thousands of years (unless you consider an alpha-male leading a small tribe a form of government).

Rather, my point is that modern, complex economies with their associated domestic and international trade exist only with the presence of governments and I believe that it is a wild leap of faith that these markets and trade, even though flawed in many ways, would ultimately be inferior to other theoretical frameworks under which markets could operate.

Yes, there is great cost to government. However, there will always be great cost to any human system that supports a modern civilization.

If you're accustomed to 'order' being brought about one way — by human decision and force — then it is difficult to conceive of it coming about without central direction and force. And it's doubly difficult to imagine that whatever would come about spontaneously would be BETTER than what is designed and imposed from above.

Much the same, I believe, is true about the way people today think of law. Because the state is its chief enforcer today — and because the state imposes so much legislation (and calls it "law") — many people today dismiss out of hand the notion that law can be produced by some means other than central state design and imposition.

It's much like the debates that raged throughout Europe from the late middle-ages until about 150 years ago: because religion was always supported by the state, with some creeds favored and others persecuted, the belief was widespread that the state simply HAD to be enforce religious belief — that freedom of religion would result in utter anarchy, a deterioration of social order, a war of all against all.

Of course, we know now that neither steel production nor religious beliefs need to be planned by, or even endorsed by, the state.

The same is true of law. History is full of examples of law emerging and changing spontaneously. The Law Merchant is perhaps the most instructive such development.

Unless the government creates disorder by interfering in markets via policies such as drug prohibition.

Much of the disorder through history is caused by conflict between competing rulers, rather than by the people they seek to rule.

The problem of state power is that it legitimizes sociopathic activity by displacing moral values, replacing them with legislation.

History reveals not that many people can't get along without a state, but that the state refuses to allow people to get along without its 'services'.

because "justice" is a word that simply denotes whatever a state enforces

Justice is a moral concept. The law does not care about justice. The only interest the state has is in obedience to its rules.

Much of today's commercial law, including the Uniform Commercial Code in use the U.S., comes directly from the Law Merchant.

Furthermore, a great deal of today's private international commercial law is not enforced by any sovereign power. See a series of papers written in the mid-1990s by Robert Cooter of the Boalt Hall law school at UC-Berkeley.

Plenty of examples? Of complex markets like those typical in the west being successful with no government involvement? Really? Can you identify this plentiful evidence?

Or if its not a Civil Govt. like we have, an Alternative form of Govt. would fill the Vacuum….like the Mafia.

always order in disorder, and basic human nature and history is indicative of this

The idea that we'll all just agree, peaceably, on this standard without any central authority seems nonsensical.

Seems to me that most people already do agree.
Do you think a 100% consensus is required?

Most people agree in the context of an already established central authority. We have no idea how most people would think or behave in a radically different context. You don't even know how you would behave, and I don't know how I would behave. If could know, I'd nominate myself for philosopher king and chief central planner, but I can't know, and neither can anyone else.

Do you not think that arbitration can resolve most disagreements?

Arbitration presumes a central authority. It works if this central authority outweighs other parties to the arbitration. A negotiation without this authority is mediation rather than arbitration, and I don't think it can resolve many disputes.

You and I can disagree fundamentally over the resolution of a dispute. If we both want to eat the same antelope, no natural propriety governs which of us will eat it, never mind the antelope's sense of propriety. A rational argument in favor of one or the other presumes some fundamental agreement on standards a priori, and these arguments ultimately may be more rationalization than rationality. You simply prefer the "rational" standards supporting your claim while I prefer the standards supporting mine.

Regardless, I don't observe mediation settling disputes as a matter of fact. I observe people subjected to forcible propriety. I was born into this world, and I'll die in it, and I have little clue how life would be otherwise. Neither do you.

Are you at all able to consider other possibilities?

I'll discuss reforms of current law, like a progressive consumption tax or various forms of educational privatization or Social Security reform. Maybe we can speculate meaningfully about the consequences of an incremental change; otherwise, we can only play a hopelessly utopian game.

Do you recognize that a monopoly enforcer of 'justice' contains the capacity for enforcing injustice?

Not in my lexicon. A state can enforce human misery but not "injustice", because "justice" is a word that simply denotes whatever a state enforces. If the state orders you to march with your children to a concentration camp to be exterminated, that's "justice". Justice is the business of armed men and bullshit artists.

And given human nature, does not such enforcement become inevitable?

Well, life isn't so miserable in my neck of the woods really, and it seems to become less miserable for most people I know. That's all I can say. I imagine it could improve. I imagine a lot of things.

But no, read the essay, enjoy it, expand your mind. Then take a reality check .

Just about. I don't know how many people already engage in non-violent lying, cheating and stealing but it's not small. Without fear of criminal prosecution by the government the number would surely be higher. Market incentives for cooperation that depend upon rational thinking already don't stop these people, and it is utopian thinking to believe otherwise.

The numbers on the propensity to violent crime are better known because those crimes are easier to detect and more difficult to hide. Only 3% or less of the population will ever commit an armed robbery, a violent mugging or a murder. But that <3% is enough to fill prisons faster than they can be built and to employ several million people in the U.S. alone in some aspect of the criminal justice system.

These criminals already have powerful incentives to refrain from their criminal behavior. But they don't. To believe that market incentives can deter crime or that markets can exist without government is sheer folly to be indulged in only by tenured professors in ivory towers of comfort.

Someone has to enforce the law and that will require force. Is the question should that force and law be monopolistic or competetive? Should their be several separate groups enforcing different laws with different groups of force or on law and group of force? Is that the question?

It seems there have been several examples throughout history where force and law were separated into power groups, sometimes warring factions, cartels, ethnic groups, and it is very rare for there to be order in such a situation. Is there any situation where in such an occurrance a prolonged period of growth took place?

There are many historical periods of complete disorder. If markets can exist without governments, shouldn't order spontaneously break out. There is law in the broad sense that you use the word–there is mine and yours, acceptable and unacceptable, though there is no legislation. Shouldn't in these times we have seen order and growth without intrusive government messing everything up?

I'd really like to understand the anarcho-capitalist answer to this argument.

Charlie