Koen Swinkels has a great article on LRC today, Ron Paul and the Role of Ideas in Class Conflict. In the article he explains that
"The state depends for its continued existence on the enthusiastic support of only a few. It requires the acquiescence of many more. The few that are enthusiastic about the state are the ones that profit from it, such as politicians, bankers, bureaucrats, contractors, big corporations, mainstream media (MSM), intellectuals, lobbyists and unions. The profit comes at the expense of the many. This as the classical liberals explained is the only meaningful class conflict in society. The trick to keeping the many complacent is to deceive them into thinking they are actually not being plundered. This is achieved in at least three ways:
This includes intellectuals coming "up with theories justifying state institutions before or after they are created" as well as "Mainstream media and intellectuals ... drastically narrow[ing] the terms of acceptable debate by taking statism as a given."
I want to note Hoppe's more systematic insights into how the state is able to manipulate the populace into tacitly supporting it. In his classic essay Banking, Nation States and International Politics: A Sociological Reconstruction of the Present Economic Order, Hoppe notes (pp. 62-66) (I quote this brilliant passage at length):
as a state emerges, then, it does so in spite of the fact that it is neither in demand nor efficient.
Instead of being constrained by cost and demand conditions, the growth of an exploiting firm is constrained by public opinion: non-productive and non-contractual property acquisitions require coercion, and coercion creates victims. It is conceivable that resistance can be lastingly broken by force in the case of one man (or a group of men) exploiting one or maybe two or three others (or a group of roughly the same size). It is inconceivable, however, to imagine that force alone can account for the breaking down of resistance in the actually familiar case of small minorities expropriating and exploiting populations ten, hundreds, or thousands of times their size. For this to happen a firm must have public support in addition to coercive force. A majority of the population must accept its operations as legitimate. This acceptance can range from active enthusiasm to passive resignation. But acceptance it must be in the sense that a majority must have given up the idea of actively or passively resisting any attempt to enforce non-productive and non-contractual property acquisitions. Instead of displaying outrage over such actions, of showing contempt for everyone who engages in them, and of doing nothing to help make them successful (not to mention actively trying to obstruct them), a majority must actively or passively support them. State-supportive public opinion must counterbalance the resistance of victimized property owners such that active resistance appears futile. And the goal of the state, then, and of every state employee who wants to contribute toward securing and improving his own position within the state, is and must be that of maximizing exploitatively acquired wealth and income by producing favorable public opinion and creating legitimacy.
There are two complementary measures available to the state trying to accomplish this. First, there is ideological propaganda. Much time and effort is spent persuading the public that things are not really as they appear: exploitation is really freedom; taxes are really voluntary; non-contractual relations are really "conceptually" contractual ones; no one is ruled by anyone but we all rule ourselves; without the state neither law nor security exists; and the poor would perish, etc.
Second, there is redistribution. Instead of being a mere parasitic consumer of goods that others have produced, the state redistributes some of its coercively appropriated wealth to people outside the state apparatus and thereby attempts to corrupt them into assuming state-supportive roles.
But not just any redistribution will do. Just as ideologies must serve a—statist—purpose, so must redistribution. Redistribution requires cost-expenditures and thus needs a justification. It is not undertaken by the state simply in order to do something nice for some people, as, for instance, when someone gives someone else a present. Nor is it done simply to gain as high an income as possible from exchanges, as when an ordinary economic business engages in trade. It is undertaken in order to secure the further existence and expansion of exploitation and expropriation. Redistribution must serve this strategic purpose. Its costs must be justified in terms of increased state income and wealth. The political entrepreneurs in charge of the state apparatus can err in this task, as can ordinary businessmen, because their decisions about which redistributive measures best serve this purpose have to be made in anticipation of their actual results. And if entrepreneurial errors occur, the state's income may actually fall rather than rise, possibly even jeopardizing its own existence. It is the very purpose of state politics and the function of political entrepreneurship to avoid such situations and to choose instead a policy that increases state income.
While neither the particular forms of redistributive policies nor their particular outcomes can be predicted, but change with changing circumstances, the nature of the state still requires that its redistributive policy must follow a certain order and display a certain structural regularity.
As a firm engaged in the maximization of exploitatively appropriated wealth, the state's first and foremost area in which it applies redistributive measures is the production of security, i.e. of police, defense, and a judicial system. The state ultimately rests on coercion and thus cannot do without armed forces. Any competing armed forces—which would naturally emerge on the market in order to satisfy a genuine demand for security and protection services—are a threat to its existence. They must be eliminated. To do this is to arrogate the job to itself and become the monopolistic supplier and redistributor of protection services for a defined territory. Similarly, a competing judicial system would pose an immediate threat to a state's claim to legitimacy. And again, for the sake of its own existence the judicial system must also be monopolized and legal services included in redistributive schemes.
The state's nature as an institution engaged in organized aggression also explains the importance of the next field of redistributive activities: that of traffic and communication. There can be no regular exploitation without monopolistic control of rivers, coasts, seaways, streets, railroads, airports, mail and telecommunication systems. Thus, these areas, too, must become the object of redistribution.
Of similar importance is the field of education. Depending as it does on public opinion and its acceptance of the state's actions as legitimate, it is essential for a state that unfavorable ideological competition be eliminated as far as possible and statist ideologies spread. The state attempts to accomplish this by providing educational services on a redistributive basis.
Furthered by a system of state education, the next crucial area for redistribution is that of redistributing state power itself, i.e., the right assumed by the state to expropriate, exploit and redistribute non-productively appropriated assets. Instead of remaining an institution which restricts entry into itself and/or particular government positions, a state increasingly, and for obvious strategic reasons, adopts an organizational structure which in principle opens up every position to everyone and grants equal and universal rights of participation and competition in the determination of state policy. Everyone—not just a privileged "nobility"—receives a legal stake in the state in order to reduce the resistance to state power.
With the monopolization of law and security production, traffic, communication and education, as well as the democratization of state rule itself, all features of the modern state have been identified but one: the state's monopolization of money and banking. ...