What is private governance? Who's the author of this essay
and what points is he trying to make?
Edward Stringham is a PhD economist.
He was working at Oxford at the time when I came across this
article. He published it at the Cato
Institute. So he makes the claim that look
whenever the status say that we need to look out for the free
market, one of the things they say.
Is that in the free market, there could be monopolies.
This is where one group has almost unlimited power.
Under this situation, you'd get higher prices and worse quality
than you'd otherwise get under competition.
So he says they're completely right about that.
And that criticism also applies to the state, even when it comes
to protecting people's person and property.
Turns out this is just Edward Stringham's thesis.
Is protecting your person and property is just another good or
service. That is met far better through
voluntarily funded competition than it is through a coercively
funded monopoly. So just on the face of it, the
mass murder campaigns that the state has engaged in between the
world wars, the cold wars, the proxy wars that alone should
make us suspicious of, are these the people who are really
keeping us safe and stopping us from Thomas Hobbs's nasty,
brutish and short life? Or are they causing far more
than they claim to protect us from?
Second, they cage a lot of people for victimless crimes.
That is a great violation of life.
Limb and property have completely unjustified fines for
other victimless crimes, and every year they more or less
brag. They call it a service, the
Internal Revenue Service, taking a significant amount of your
money, claiming to cage you if you don't chip in.
This is yet another violation of person and property.
So is the state. A unique protector.
Not only is it not a unique protector, Stringham says, but
it is in fact a unique aggressor.
Compare all the private theft verse all of the theft that the
police engage in when it comes to civil asset forfeiture.
Washington Post kindly I appreciate the post on this one.
They said that civil asset forfeiture has actually exceeded
private burglaries. So just on that alone.
Forget about the state, the fact that the state taxes coercively,
collects trillions of dollars through tariffs and and
everything else, and then has a monopoly printing press for
whatever money they can confiscate, he goes, These are
blatant examples of the violation of the things state
claims to protect. He goes, OK, so we got the
principal down. Monopoly bad.
Competition good, volunteerism good, coercion bad.
So the first thing that people say is, well, how would this
work hypothetically? And he goes, well,
hypothetically, you could have organizations that compete
against each other and provide security in exchange for money.
And the reason they wouldn't necessarily go to war is when
you have to bear the cost of violent conflict, you're much
less likely to engage in it. So you're much more likely to
come to some sort of agreement. And we do see this with
competitors. Can competitors cooperate?
It sounds like a contradiction to the those ignorant of
economics. However, if you have a phone
from T-Mobile and I have one from Verizon, we're actually
able to cooperate when MV7 sure makes this Dell doesn't make the
same Dell computer. Turns out Dell and MV7 sure
cooperate with CenturyLink Internet.
Providers and this Brother printer, all of these
competitors are actually engaged in cooperation because it
actually helps things out. Someone with a Gmail can send an
e-mail to someone with ProtonMail, cause competitors
even have an incentive to cooperate with each other.
Same with insurance companies. Discount tire tires go on to
both Ford and Hondas and you know everything else.
So hype, theoretically they can cooperate.
But Stringham says actually the case is far better than that.
I can't remember the exact example he uses, but he goes
back to the Middle Ages and says here are tons of examples of
private governance arising. So what I will do instead is try
to extract the lesson and actually give a real world
example. I work with a small business who
had experienced ransomware. This is where you log into your
Business Network, only to find. That your computer is completely
black and all of your files are encrypted and up on your screen
is a message that says all of your files are encrypted.
You can't read a God damn thing. Pay us $200,000 and then you can
read your files again. We will de encrypt them now you
can send the money and it's now this was this was not some
trivial example. This was, hey, everything we've
worked for for the last 10-15 years.
It all went away this morning. Because someone violated our
private property, and none of them, they're not a bunch of
libertarians either. This is a completely different
organization. None of them said quick call
911, Quick call the FBI, call the National Security Agency
because our property rights have been violated.
And this is what the state does. First thing they did was they
called a private security company in Arizona.
This is an IT firm. What that IT firm did was use.
Sentinel One. This is a cyber security
organization to stop the hacking and protect everything else that
was that had survived, they then used Paypal's security team in
order to keep their finances adjusted.
They contacted their private banks to let the banks know hey
stop authorizing payments to anyone unless I explicitly give
them my stamp of approval and then they use Google.
Drive backup security in order to keep their previous files, in
order to get access to the files that were encrypted because
those were saved. Because Google, a private
organization for the most part, has the incentive to have happy
consumers so they can make more money for themselves.
So when push came to shove, when it really, really mattered
something so vital their entire business, they only went to
private security. One person mentioned going to.
The state, he wants the computer to be, you know, investigated,
but but literally the complete opposite of what we're always
told. Well, if you're ever in danger,
call the government. It's like no one really thought
that the state would be the most effective approach.
They don't have the knowledge or the incentives to create
products or services that are really desirable.
So it turns out protecting your person and property is a good or
service, just like anything else.
And should be achieved through voluntarily funded competition
as opposed to a coercively funded monopoly.
Tons of those real world examples all around us.
I went to the Slipknot concert, very dangerous place, lot of
people on bath salts and tons of stuff there.
And there was private security. I went to the Scottsdale Mall a
week ago, tons of private security and there's a lot of
high end stores that could get robbed there.
Private security. Made me feel safe every time I
go to a Diamondbacks game. Private security all around
Disneyland has private security. All these places all around us
have the very private governance governments claim that only they
can provide. That's the great lesson from
Edward Stringham's essay. Yeah, it just again from the
libertarian standpoint, it's like any product or service
that's provided by a private market actor tends to be lower,
lower cost and higher quality than anything provided by a
government agency. And it just seems to be a matter
of incentives, right? The state is incentivized just
to keep you docile and and vulnerable to taxation.
They're not not really too concerned with protecting your
actual life, liberty or property.
That's a service that's much better rendered by a a private
contractor of some kind. Makes a lot of sense to me.
And of course, private markets have the incentive to not just
cater to the 1%. People will say, well, if things
are privatized and only the rich can afford them, I just got to
steal the Michael Malice line of yeah, if there was only private
security, only the rich would have security.
And if clothes are privatized, the only clothes will be
tuxedos. If cars are privatized, there
will only be limousines. And if food is privatized, there
will only be foie gras and caviar available.
He goes. No, there's actually an
incentive for them to not just build the yachts.
But to meet the mass of consumer demand, so, and no the company,
I'm not going to say their name, it was not Walmart, Amazon,
Apple or Google. This was a small company close
to to where I live. But they use only private
security because it was just more efficient and they have
every incentive to cater to the most people for their own profit
interests and there's nothing wrong with that at all.
So that was just an important thing I should have mentioned
originally.