Iceland: A Libertarian Model?

Correspondents have suggested that the original organization of Iceland society represents a model for libertarian limited government, somewhat analogous to the original organization of our Thirteen Colonies. To learn more about this issue I consulted:


This 1991 dissertation is about Iceland between the 10th and 13th century, the so-called Commonwealth period. Iceland was populated by people escaping the political chaos in Denmark, Norway, and maybe England and Ireland. They were mostly Viking families. As they settled the uninhabited land, they formed local and then regional governing committees to settle disputes and to judge criminals. They had no ruling elite at first, but committee members were all were property owners. Crimes were paid by restitution and punished by banishment, either temporary or permanent.

The people who colonized this hostile environment did so to escape from their Kings’ wars. Although illiterate, they were wise enough to avoid creating another monarchy. They believed in private property and in reciprocal cooperation, but they brought with them the nagging social problems that affect all human societies, dependent individuals. At first, orphaned children, isolated sick people, and lone infirm old people were parceled out to healthy families by the local committee depending on the burden those families could handle. In bad years of need, the sick, the young, and the old were left outdoors to freeze. So when the local chiefs offered a welfare service to care for these people through the church in exchange for an annual tithe of 1% on all personal property, the people accepted the idea.

The problem these primitive people could neither foresee nor forestall resided in that authority to tax. That power was given to those local individuals who were also their leading farmers, judges, and priests. An individual’s temptation to expand his power to collect this easy money became irresistible and territorial civil war was inevitable. By 1264 the war-weary people of Iceland had given themselves to the protection of the King of Norway. Individualism built this society and socialism destroyed it.

The American people have made exactly the same mistakes. Listening to the same siren songs from political government, and despite our brief introduction to the innovation of private insurance, we have accepted the idea of paying taxes for welfare and warfare.

Is it too late to turn back? The people of Iceland made their seminal mistake by adopting domestic taxation within six-generations of their settlement and it took one and a half centuries of civil war to result in the end of their independence from a centralized state. One could argue that the people of America similarly made their seminal mistake by adopting domestic taxation within six generations of their settlement and that we also lost our independence from the centralized state in roughly one and a half centuries (WWII). Although there are distinct differences in the manner in which domestic taxation affected each society, the results are remarkably similar. Once a people have traded their sense of self-reliance for a sense of co-dependency wrought through taxation, their society has nearly sealed its fate.

Do we now search for an equivalent of a King of Norway to come forth and save us from our folly? How about a One-World Political State? This dream of centuries of scheming warlords has not gone away. The United Nations wants to tax the world (read U.S.) for the welfare of mankind. The siren sings. Some people even listen. Is it an accident that this proposal is made public as the American Imperial War Machine rolls across the planet? War and Welfare Forever! Or to complete the Marxist rationalization of Lord Keynes, "In the long run we’re all dead" at the same time.

Solvason concludes:

The forced cooperation through the Hreppar [committee], within an otherwise voluntary associated structure, and residency requirement also make it harder for anyone to claim that the Commonwealth was in any significant way an example of libertarianism in practice.

The Commonwealth was a limited political government, but a political government nonetheless, and as such it failed to provide the security and justice that it promised. Political government always fails. If human society is to endure beyond our "time of troubles," as Toynbee called such times as we live in today, the one concept or organizing principle we must supersede is political government.

The alternative, as Hans-Herman Hoppe concluded in his book, Democracy, The God That Failed, is to "…finally allow insurance agencies to do what they are destined to do …" (pg.292) — that is, to replace the promises of political government with private contracts for security and justice — with a money-back guarantee for success.