Critical Comments on Anarcho-Capitalism

Guest post from Bet On It reader Rodrigo Coelho

In response to the Brook-Caplan debate, one of my Portuguese readers sent me the following set of critical comments. I’ll respond in a week or two. Enjoy!

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Hey Mr. Caplan,

I’m Rodrigo, from Portugal (so English isn’t my first language, but hopefully it should be good enough for our purposes), and I’ve been an admirer of your work for several years. I’m not sold on anarchism, though. But you’re a very original thinker who’s managed to shift my views on various subjects so I’m open to the idea that there might be something about your case for anarchism that I’m missing and that’s why I’m sending this email.

Beforehand, I read your Anarchist FAQ, The Anarcho-Statists of Spain (which I thoroughly enjoyed! Thought you made a great case as to why anarcho-capitalism is at least more internally consistent than left-anarchism), and The Economics of Non-State Legal Systems. If you have more essays or articles making the case for anarchism I’d be happy to read them as well.

I’ve read a lot of anarcho-capitalist literature over the years. The main names (other than yourself) being David Friedman, Murray Rothbard, Hans-Hermann Hoppe, Gustave de Molinari, and Lysander Spooner (it may be anachronistic to use the term for the last two, but I think it’s fair to say they’re at least ancap-adjacent). But I was never really convinced.

First, a common argument you make which seems pretty convincing at first is that there are more private security guards than police in the US (and maybe a few other countries as well). You also mention gated communities and private commercial arbitration as prime examples of the market providing services that are typically thought of as the sole province of government.

But my main objection to that is simply that all of those exist within a framework of laws provided by the government. It’s not at all clear to me that those would work just as well without a government providing a robust rule of law that applies to everyone in society.

To further emphasize this point, if we look at history it’s clear that the most successful nations are the ones that adopted free-market principles to the largest extent and that the closer we get to laissez-faire the better the outcomes, in terms of freedom and prosperity, seem to be.

But all examples of tremendously successful and relatively laissez-faire economies, whether historical (late 19th century America and Britain) or contemporary (Switzerland, Singapore, Hong Kong, and a few other city-states) have existed under a system of laws provided by the government.

By contrast, stateless societies have been the norm for large chunks of human history. Various anarcho-capitalists have cited medieval Iceland and Ireland as examples of societies that had elements of anarcho-capitalism. I’m honestly not educated enough about these to judge properly, but both lasted for multiple centuries (according to Murray Rothbard in For a New Liberty, the “libertarian” society of Ireland even lasted for a thousand years) and neither seems to have led to anything remotely close to the industrial revolution in terms of growth and innovation. I’m also going to assume they fall short by these standards of even other pre-industrial societies such as Ancient Greece or Renaissance Italy. And I highly doubt that medieval Iceland or Ireland were anything even remotely close to beacons of freedom that protected individual rights in the way classical liberals and libertarians would have it.

There seems to have been something unique about the British (and later, American) political tradition, when it comes to the rule of law and the protection of property rights, which took centuries to develop (starting from at least the Magna Carta) and played a crucial role in enabling the industrial revolution and the unprecedented increases in freedom, prosperity, innovation, and overall human flourishing of the 19th century. Given the examples I mentioned of successful nations with relatively free-market economies backed by a strong rule of law provided by the government, when we compare them to the mediocre stateless societies it seems reasonable to conclude that a good legal system is a precondition of free markets, not the other way around.

And, to clarify, I’m willing to fully concede that the standard Hobbesian objection to anarchism might not be true in all cases. It’s entirely possible that whatever social arrangement they had in medieval Iceland or Ireland, it was in fact close to anarcho-capitalism in some respects and it didn’t lead to constant gang warfare. And also that if we were to repeat that kind of system today it might not necessarily lead to chaos in the streets. I just think that, by the various standards I mentioned (including individual freedom), this kind of system seems to fall short of free-market economies with a legal system provided by the government. It’s not at all clear that, even if those security firms don’t go to war with each other to resolve disputes, whatever compromise they would come up with would respect individual freedom better than even the status quo today in most Western mixed economies.

To his credit, David Friedman acknowledges this eventuality in The Machinery of Freedom, when he recognizes that an anarcho-capitalist society might be far from libertarian/classical liberal in terms of rights-protection.

Another, more obvious, objection I have to anarcho-capitalism is that if the “free market” (which, without a government, we might as well call the state of nature) leads to an efficient provision of the government services involving the use of force, then how did governments even come about in the first place?

Finally, there are two sort of big deals in life that I haven’t seen any anarcho-capitalist address convincingly: children and nukes.

Under anarchy, what happens when a child abuser has a kid? Sure, you could point to the many flaws in the government system, but at least there’s a relatively uniform system of laws in place that apply to children. Under anarchy, children presumably wouldn't be customers of any rights-protection agency.

Similarly, you could point out that, under government, absolute maniacs like Kim Jong Un and Vladimir Putin have access to nuclear weapons. But still, the number of people in the world in possession of nuclear weapons is relatively small and they’ve only been used in one war in the span of almost a century. There are far worse possible outcomes than that.

What happens under anarchy? Could anyone just own a nuke? While developing a nuclear weapon is obviously no walk in the park, it seems reasonable to assume that under anarchy there would probably be more nukes than today given the billions of people on Earth who would suddenly be free to develop and own them. Even if one buys the idea that nuclear proliferation leads to more deterrence at the international level, I think it’s definitely not crazy to have more than a few doubts at the individual level. Anyone with a nuke could basically declare himself a tyrant.

On a related note, a problem you’ve acknowledged in The Economics of Non-State Legal Systems is the sort of catch-22 that the more economies of scale for the production of security would exist under anarchy the more effective that society would be at protecting itself from foreign threats, but also the greater a risk of cartelization there would be between the few security firms that could thus consolidate back into a government (which might or might not be worse than those we have today). And vice versa.

And, sure, you’re absolutely correct when you point out that “National defense is, strangely, only a public good on the assumption that some military forces are a public bad.” But if an anarcho-capitalist society would require the entire world to eliminate its military forces in order to be able to protect itself from foreign threats… Well, you see the problem.


I know this is A LOT, but I’ll be thankful for any thoughts you can give! And I’m looking forward to your debate on the subject with Yaron Brook. Unlike him, I don’t necessarily agree with the resolution that “anarcho-capitalism would definitely be a complete disaster for humanity,” I just highly doubt it would be anything better than mediocre given the alternatives.