Welcome to Ancapistan, land of the free (market) 

Jayan Luharia - Mar. 25, 2024 - 11 min read - #Politics 

Imagine that you are a lone traveller. You traverse a foreign landscape in search of the society that dictates this end of the world. In a land with an abnegation of the standard democratic state model of the West, what prevails in its absence? You stumble upon a remote city-state that bears a sign on entry. It simply reads: “Welcome to Ancapistan, land of the free.” Immediately, you make the cognitive link between the name and the branch of anarchistic ideology referred to as ‘anarcho-capitalism’, the child of thought belonging to Murray Rothbard and David Friedman. What surprises you is that you considered the ideology as purely hypothetical and incapable of being a serious foundation for a society. At this point, you learn to confront the truth. 

The concept of anarcho-capitalism sparks an internal criticism in your mind: how can such a society even function if it is dependent on market mechanisms in its entirety? Doesn’t this give rise to a monopoly? Isn’t a monopoly a bad thing? The citizens of Ancapistan would likely tell you otherwise. They would perhaps make the argument that the democratic states of the West aren’t significantly different, for isn’t the state a monopoly in of itself? Where is the state’s competition? The state behaves hardly any differently from a monopolistic empire. Look how it tactically extends its power, removing its adversaries and attempting to gain influence over the people. Look how it lives freely in the public domain with no rivalry and no urgency for efficiency. Maybe, the people of Ancapistan would say, you will come to realise that you are the victim of this great monopoly due to an involuntary contract that provides you with no alternative to obedience.

Meanwhile, Ancapistan runs slightly differently. In place of the state, you have agencies providing the range of services that the state would typically provide. The key difference is that the social agents have to make a conscious effort to expand their operations and convince individuals of their service in contrast to the state, which has a proclivity for exploiting the fruits of their theft through taxation and through enslaving their people to serve them in conscription. At this point, we can imagine the globe as an oligopoly of power-hungry corporations seeking to exploit each other whilst simultaneously exploiting the individuals that populate their internal borders to provide economic growth. 

You might argue that at least the social contract we have with the state is justified through elections. By voting for MPs and electing governments, doesn’t this prove that individuals have an active role in shaping the executive bodies? Comparatively, as was said by Noam Chomsky, doesn’t anarcho-capitalism produce “forms of tyranny and oppression that have few counterparts in human history”? Perhaps we can overcome this presupposition by considering a corporation in practice. Most corporations of considerable influence and size tend to be public limited companies which distribute and sell their shares via the stock exchange, enabling the populace to purchase shares and reap the rewards of corporate success. Critically, the role of the shareholder and a member of the electorate aren’t vastly different. The voter has virtually no control over the executive decisions of the government they elect, and arguably their vote can be perceived as a needle in a haystack when positioned beside the vast quantity of votes for various political parties and politicians. Similarly, the shareholder holds little influence over corporate decisions, especially if their share is relatively small. 

Perhaps, you may think, this abstract system has the capacity to work on a theoretical basis but where, you may ask, are the real-life examples to firmly enforce the credibility of the anarcho-capitalist ideology? If you were to approach the Ancapistanis further down the road, it is perfectly probable that they might direct your attention to the miraculous anomaly of Medieval Iceland. Within the period spanning 930 to 1262 ce, the justifications of the current anarcho-capitalist ideology are capable of being found, when considering the Icelandic Commonwealth’s structure. The Commonwealth had no apparent centralisation of power, bureaucracy or executive and is often referred to as a stateless society — a stateless society that depended on the voluntary exchange of the individual and the chieftain (goðar), in which the farmer would receive the benefits of defence, enforcement and insurance in exchange for their support in local assemblies. Sceptics of this interaction argue that the chieftain is hardly distinguishable from a state, except for the fact that the chieftains are a fractured form of authority. This assumption can be undermined through one consideration: the chieftains had no authority to enforce law or maintain control over the district in which they operated. Rather, the chieftain acted similarly to a private agency by competing with rival chieftains in order to gain clients. Strengthening this claim, the chieftain-farmer relationship was both a free choice and was contractual: every farmer had the ability and the right to choose the chieftain that they wanted and gave farmers within a district the ability to choose a chieftain and their corresponding package of benefits through individual choice. This differs starkly from the Western democracy in which the individual choice element is rejected entirely in favour of an arguably muddled ‘people’s choice’, leaving much of the population dissatisfied with a contract they had little will in agreeing to. Furthermore, the legal system was a very flexible entity in Iceland with chieftains avoiding direct involvement in public affairs. Instead, an individual would be able to pursue a case privately through a chieftain in order to obtain justice through compensation and resulting fines. Additionally, disputes would often be settled through the interaction of chieftains in the occasional local assemblies, with chieftains acting as negotiators and intermediary figures. Despite the numerous advantages of this essentially private system, it is also worth noting that eventually the Commonwealth did experience internal disputes, fracturing the original arrangement. In conjunction with this, the presentation of the chieftain system outlined above is subject to much debate and it is arguable that modern libertarians will skew the presentation of the Commonwealth into a more positive light than the Icelandic Sagas have alluded to, with the possibility that the system at times resulted in violence and injustice. 

With all of the polarising points considered and due to the sheer remoteness and isolation of Ancapistan, you attempt to consider how elements of the anarcho-capitalist agenda could be incorporated into Western civilisation without a full Icelandic-level overhaul. Perhaps on a scale of the hundreds of millions the effectiveness of the chieftain system would be weakened. The first ideas that your mind latches onto are policing, infrastructure and land ownership. You decide that a self-adjudication system would simply be too messy when trying to implement a private administration of justice given that the enforcement mechanisms necessary would be particularly difficult to reach. With regards to policing, a novel scenario enters your head. What if a large and expansive privately-owned public space (POPS) (imagine Zuccotti Park but much larger), were to be policed solely by a private police force? How would the distribution of private policing work? In the world of markets, the Brookfield Properties equivalent would likely resort to using competitive bidding. Competitive bidding would enable competition between police services, and a city-wide competitive market would arguably result in highly efficient and flexible law enforcement, with services being directly tailored to the needs of the buyer. The only concern is the issue of the monopolised police force. Once a police force occupies a large enough share of the private policing market or successfully completes acquisitions of its competitors, then the necessity for urgency, quality and efficiency would inevitably decline. Barriers to entry could also be established by a monopolised police force, such as ensuring the majority of entry programmes for police officers were under their provision. Additionally, crony-capitalist tactics may emerge in which the private police force could result in using more corrupt mechanisms in order to encourage private land-owners to purchase their service. In order to overcome this obstacle, the establishment of independent oversight mechanisms would be useful in monitoring the activities of the private police force, ensuring compliance with anti-bias policies. Such oversight agencies would ensure regulation is applied to prevent unfair vertical integration of private police forces and similar private corporations where there is a risk of an entity becoming anti-competitive. Despite the necessity for competition, the argument may be undermined due to the importance of natural monopolies in the utility services, such as water. With utilities of this sort, resources need not be unnecessarily wasted and plundered through competition and a singular entity may be viewed as more favourable. 

Addressing the other two points, you may simply consider infrastructure development under the state as opposed to under a private company. With investors to please and time of the essence, the private company would likely construct a building that a state would take 5 years to construct in a single year. Elsewhere, when considering national parks and the significance of parkland, it could be argued that the privatisation of the majority of parkland could actually be of great benefit to the environment and to the people who use it. There is a common presumption that with privatisation and capitalism coincides a neglect for environmental standards. In some contexts, this is undoubtedly true. But when the very service provided is reliant on the quality of the environment, then perhaps the privatisation of parkland would present some good. Private owners would generate revenue from entry fees and would use this revenue to fund maintenance as they would have an incentive to preserve and maintain the natural beauty of their parkland in order to attract customers. Competition would drive innovation in park management, leading to conservation efforts flourishing without the interference of centralised authorities. The concern here is that a privatisation of parkland would lead to an unequal access to the service and some would argue that parkland should be entirely separate from the private sphere in consideration of natural rights. Comparatively, the national park provides a fantastic opportunity to enable general admission to the natural landscape and fosters national identity and pride, but in reality funding and conservation schemes can often be sidelined or abandoned entirely by governments. 

As you stand palely loitering in the midst of the plateau you ponder once more over the anarcho-capitalist system and its validity as an idea. Sure, it can theoretically provide a more competitive system of service provision and could enable a greater emphasis on the often-neglected individual will. But just like all novel ideologies, perhaps there is a reason as to why you haven’t come across an anarcho-capitalist society before. Well, of course there is Ancapistan right before you. As to whether it is actually there is unclear. Maybe it is all a mirage and a projection of your ideological wandering. Maybe it is in fact real and you should go into the city-state before you in order to discover the truth. Regardless, how long would Ancapistan last before it devolved into a state of feudalism? You can picture a monopoly emerging with no common law to deter its growth. It consumes its competitors and uses marketing nudges to create distinctions between their loyal customers and the rest of society. The monopoly establishes a security force to prevent any major uprising or backlash from the masses. It constructs a vast wall around its headquarters, cutting it off from the rest of the city-state yet rising above it. It begins to tax its loyal customers in return for services and subsequently purchases all of the private news outlets. And before you know it, what do you have? A state.