A Fully Free Market Defense?

—–Original Message—–
From: G
Sent: Sat 7/29/2017 4:37 PM
To: wblock@loyno.edu
Subject: Against the Volunteer Military

Dear Dr. Block, I read your blog regularly and went back and read your article “Against the Volunteer Military.” I was wondering if you could clarify something. At the end of the article, you say, “The libertarian supports defensive armies whose solders are hired voluntarily. But this is not enough! Such armies must be paid for only by people who desire defense services and who voluntarily pay for them.” How could there be defense just of those who pay for an army? Say there is a defense insurance or fund that those who want defense services pay into, and say I and a few other people in my neighborhood pay into the fund. Then say we get invaded by some foreign army. It seems unrealistic to think that the army would defend only me and the others in my neighborhood who paid into a defense fund. Or have I misunderstood the problem? I’m just trying to understand how something would work in the real world.

(I really enjoy your work by the way. Your Defending the Undefendable was a major force in turning me toward libertarianism.) Sincerely, G

Dear G: Thanks for your kind words. What you are saying in effect, or, rather, fearing, is that there is no way to prevent “free riders” from benefitting from defense, without paying for it. Therefore, no one, or way too few people, will pony up for this undoubted benefit, and thus the free market country will perish, since it will have no (even) defensive army. This is known in the neoclassical literature as the public good market failure. Exhibit A is the army; exhibit B is the lighthouse. I offer you an Austrian bibliography that refutes this argument:

Public good:

Barnett and Block, 2007, 2009; Block, 1983, 2000, 2003; Cowen, 1988; De Jasay, 1989; Holcombe, 1997; Hoppe, 1989; Hummel, 1990; Osterfeld, 1989; Pasour, 1981; Rothbard, 1985, 1997; Schmidtz, 1991; Sechrest, 2003, 2004A, 2004B, 2007; Tinsley, 1999.

Barnett, William II and Walter E. Block. 2007. “Coase and Van Zandt on Lighthouses,” Public Finance Review, Vol. 35, No. 6, November, pp. 710-733

Barnett, William and Walter E. Block. 2009. “Coase and Bertrand on Lighthouses,” Public Choice; 140(1–2):1–13, http://dx.doi.org/10.1007/s11127-008-9375-x

Block, Walter. 1983. “Public Goods and Externalities: The Case of Roads,” The Journal of Libertarian Studies: An Interdisciplinary Review, Vol. VII, No. 1, Spring, pp. 1-34; http://www.mises.org/journals/jls/7_1/7_1_1.pdf

Block, Walter. 2000. “Word Watch,” April 20; http://www.mises.org/fullstory.asp?control=414&FS=Word+Watch

Block, Walter. 2003. “National Defense and the Theory of Externalities, Public Goods and Clubs.” The Myth of National Defense: Essays on the Theory and History of Security Production, Hoppe, Hans-Hermann, ed., Auburn: Mises Institute, pp. 301-334; http://www.mises.org/etexts/defensemyth.pdf

Block, Walter. 1983. “Public Goods and Externalities: The Case of Roads,” The Journal of Libertarian Studies: An Interdisciplinary Review, Vol. VII, No. 1, Spring, pp. 1-34; http://www.mises.org/journals/jls/7_1/7_1_1.pdf

Cowen, Tyler, ed. 1988. The Theory of Market Failure: A Critical Examination, Fairfax, VA: George Mason University Press; http://www.amazon.com/Theory-Market-Failure-Critical-Examination/dp/0913969133/ref=sr_1_1?ie=UTF8&s=books&qid=1200191409&sr=1-1

De Jasay, Anthony. 1989. Social Contract, Free Ride: A Study of the Public Goods Problem. Oxford, England: Oxford University Press; http://www.amazon.com/Social-Contract-Free-Ride-Paperbacks/dp/0198239122/ref=sr_1_1?ie=UTF8&s=books&qid=1200191531&sr=1-1

Holcombe, Randall. 1997. “A Theory of the Theory of Public Goods,” Review of Austrian Economics, Vol. 10, No. 1: 1-10; http://www.mises.org/journals/rae/pdf/RAE10_1_1.pdf

Hoppe, Hans-Hermann. 1989. “Fallacies of the Public Goods Theory and the Production of Security,” The Journal of Libertarian Studies, Vol. IX, No. 1, Winter, pp. 27-46; http://www.mises.org/journals/jls/9_1/9_1_2.pdf

Hummel, Jeffrey. 1990. “National Goods vs. Public Goods: Defense, Disarmament and Free Riders,” The Review of Austrian Economics, Vol. IV, pp. 88-122; http://www.mises.org/journals/rae/pdf/rae4_1_4.pdf

Osterfeld, David. 1989. “Anarchism and the Public Goods Issue: Law, Courts and the Police,” The Journal of Libertarian Studies, Vol. 9, No. 1, Winter, pp. 47-68; http://www.mises.org/journals/jls/9_1/9_1_3.pdf

Pasour, Jr., E.C., 1981, “The Free Rider as a Basis for Government Intervention,” The Journal of Libertarian Studies, Vol. V, No. 4, Fall, pp. 453-464; http://www.mises.org/journals/jls/5_4/5_4_6.pdf

Rothbard, Murray N. 1997. The Logic of Action: Applications and Criticism from the Austrian School, Vol. II, Cheltenham, UK: Edward Elgar

Rothbard’s (1997, 178) reductio absurdum of public goods is as follows: “A and B often benefit, it is held, if they can force C into doing something. . . . [A]ny argument proclaiming the right and goodness of, say, three neighbors, who yearn to form a string quartet, forcing a fourth neighbor at bayonet point to learn and play the viola, is hardly deserving of sober comment.”

Schmidtz, David. 1991. The Limits of Government: An Essay on the Public Goods Argument, Boulder Co: Westview Press

Sechrest, Larry. 2003. “Privateering and National Defense: Naval Warfare for Private Profit”, pages 239-74, The Myth of National Defense: Essays on the Theory and History of Security Production, edited by Hans-Hermann Hoppe, published by the Ludwig von Mises Institute, Auburn, Alabama, 2003.

Sechrest, Larry. 2004A. “Public Goods and Private Solutions in Maritime History.” The Quarterly Journal of Austrian Economics. Vol. 7, No. 2. Summer, 3-27.
http://www.mises.org/journals/qjae/pdf/qjae7_2_1.pdf; https://dev.mises.org/journals/qjae/pdf/qjae7_2_1.pdf

Sechrest, Larry. 2004B. “Private Provision of Public Goods: Theoretical Issues and Some Examples from Maritime History,” ICFAI Journal of Public Finance, August, Vol. II, No. 3, 45- 73; http://www.mises.org/journals/scholar/Sechrest7.pdf

Sechrest, Larry. 2007. “Privately Funded and Built U.S. Warships in the Quasi-War of 1797-1801,” The Independent Review, Summer, Vol. 12, No. 1: 101-113.

Tinsley, Patrick. 1998-1999. “With Liberty and Justice for All: A Case for Private Police,” Journal of Libertarian Studies, Vol. 14, No. 1, Winter, pp. 95-100; http://www.mises.org/journals/jls/14_1/14_1_5.pdf

National defense::

Block, 2003; Cowen, 1988; De Jasay, 1989; Hoppe, 1989; Hummel, 1990; Pasour, 1981; Rothbard, 1985, 1997; Schmidtz, 1991; Sechrest, 2003, 2004A, 2004B, 2007

Block, Walter. 2003. “National Defense and the Theory of Externalities, Public Goods and Clubs.” The Myth of National Defense: Essays on the Theory and History of Security Production, Hoppe, Hans-Hermann, ed., Auburn: Mises Institute, pp. 301-334; http://www.mises.org/etexts/defensemyth.pdf

Cowen, Tyler, ed. 1988. The Theory of Market Failure: A Critical Examination, Fairfax, VA: George Mason University Press; http://www.amazon.com/Theory-Market-Failure-Critical-Examination/dp/0913969133/ref=sr_1_1?ie=UTF8&s=books&qid=1200191409&sr=1-1

De Jasay, Anthony. 1989. Social Contract, Free Ride: A Study of the Public Goods Problem. Oxford, England: Oxford University Press; http://www.amazon.com/Social-Contract-Free-Ride-Paperbacks/dp/0198239122/ref=sr_1_1?ie=UTF8&s=books&qid=1200191531&sr=1-1

Hoppe, Hans-Hermann. 1989. “Fallacies of the Public Goods Theory and the Production of Security,” The Journal of Libertarian Studies, Vol. IX, No. 1, Winter, pp. 27-46; http://www.mises.org/journals/jls/9_1/9_1_2.pdf

Hummel, Jeffrey. 1990. “National Goods vs. Public Goods: Defense, Disarmament and Free Riders,” The Review of Austrian Economics, Vol. IV, pp. 88-122; http://www.mises.org/journals/rae/pdf/rae4_1_4.pdf

Pasour, Jr., E.C., 1981, “The Free Rider as a Basis for Government Intervention,” The Journal of Libertarian Studies, Vol. V, No. 4, Fall, pp. 453-464; http://www.mises.org/journals/jls/5_4/5_4_6.pdf

Rothbard, Murray N. 1997. The Logic of Action: Applications and Criticism from the Austrian School, Vol. II, Cheltenham, UK: Edward Elgar

Schmidtz, David. 1991. The Limits of Government: An Essay on the Public Goods Argument, Boulder Co: Westview Press

Sechrest, Larry. 2003. “Privateering and National Defense: Naval Warfare for Private Profit”, pages 239-74, The Myth of National Defense: Essays on the Theory and History of Security Production, edited by Hans-Hermann Hoppe, published by the Ludwig von Mises Institute, Auburn, Alabama, 2003.

Sechrest, Larry. 2004A. “Public Goods and Private Solutions in Maritime History.” The Quarterly Journal of Austrian Economics. Vol. 7, No. 2. Summer, 3-27.
http://www.mises.org/journals/qjae/pdf/qjae7_2_1.pdf; https://dev.mises.org/journals/qjae/pdf/qjae7_2_1.pdf

Sechrest, Larry. 2004B. “Private Provision of Public Goods: Theoretical Issues and Some Examples from Maritime History,” ICFAI Journal of Public Finance, August, Vol. II, No. 3, 45- 73; http://www.mises.org/journals/scholar/Sechrest7.pdf

Sechrest, Larry. 2007. “Privately Funded and Built U.S. Warships in the Quasi-War of 1797-1801,” The Independent Review, Summer, Vol. 12, No. 1: 101-113.

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7:46 pm on July 29, 2017