Democracy and Markets in Government

My post on libertarian democraphobia has elicited a sharp response from Patri Friedman. It’s good stuff, but I think we’re talking a bit past each other. In part, that’s because I was brain-dumping and wasn’t as clear as I might have been, and in part because we have some substantive disagreements. I think maybe I can be clearer on a few points and that we can start to try to get to the bottom of our disagreements.

First, I’m completely sincere in wishing Patri and others well in their exciting visionary project. I’m eagerly watching its progress and I hope it succeeds. But I think one thing we need to hash out is why we think the probabilities of success are what we think they are. At this point, I consider the probability very low that seasteads (or something like them) will create a competitive market for systems of social organization within my lifetime. I also think the probability is low that persuasion and political organization will, by itself, be very effective in moving any already relatively liberal state within the status quo global system of states very far toward more thoroughly liberal ideals. I just happen to think that the prospect of making some progress on this front is better.

I share the view that demonstration is more powerful than argument. And I think that if there is significant further liberalization within the system of states, it will most likely be due to the salience of successful innovations in governance, and that other jurisdictions, competing for talent and investment, will act to copy those innovations. I just don’t presently think the jurisdiction most likely to set off this kind of race to the top will be a seastead. And, furthermore, I think setting off this kind of cascade requires a good deal of intellectual and rhetorical groundwork. Argument and persuasion often makes demonstration possible.

Anyway, let me reply directly to some of Patri’s remarks:

Will seems trapped in the hopeless quest to philosophically define a single just society.  I find the idea that one can determine, philosophically or practically, the best way to organize a society a priori to be laughable.  And that’s even if we agree on a single set of goals for our society – which we don’t. Competition and consumer choice are the answers – why is this so hard for a libertarian to understand?

Not hard at all. And I share Patri’s skepticism about the worth of a priori ideal theory.

We face a very hard problem – the problem of creating a good system of social organization, one with the power to enforce laws,  yet which does not abuse this power.  As liberals, we know how to solve hard problems – use markets.  Which is why I advocate for a competitive market for government.  Will, strangely, seems to like the current oligopoly with its high barrier to entry and high switching costs, and is skeptical that a more competitive market will provide a better solution.

I don’t believe I said anything that implied I like the status quo system of states. As readers of this blog know, I am deeply invested in the conviction that the fundamental human right to move — the right to exit and enter jurisdictions — must be more fully recognized and honored. Competitive markets for government can’t work if people are not allowed to “unsubscribe” from their current provider of governance or “subscribe” to another. Because governance is territorial, the very possibility of anything like consumer choice in governance is based on mobility rights. I’m not skeptical that more competition between jurisdictions will provide a better solution. I’m pretty certain it will. I think Patri has confused my defense of the possibility of progress within existing liberal democracies for complacency about the “current oligopoly” system, which I actively deplore.

Note that this argument has nothing to do with democracy, and doesn’t depend in the slightest on the morality or practicality of the system.  Democracy is simply the current industry standard product that firms offer customers.  If it truly is the ultimate form of social organization, then in a world of competitive government, democratic seasteads will outcompete all other seasteads, attract all the customers, and people will eventually give up trying other forms of government.  Personally, I find the idea that this ancient Greek technology is the best we’ll ever do to be absurd, but even if I’m wrong, even if our Thousand Nations are all different variants of democracy, the system will still improve politics by allowing for competition between those variants. so we can find those that work the best.

First, I think it’s more than confusing, on Patri’s own terms, to talk of states as if they are “firms” and as if the people who live within their territories are “customers.” I thought the point was that there isn’t a market and that people within the jurisdictions of states don’t have effective consumer choice over governments. I suppose talking as if the culmination of your work has preceded you may help to create a needed conceptual shift, but it also obscures the fact that the freedom of citizens and subjects all over the world to become globetrotting jurisdictional shoppers remains a largely political question within existing states.

Second, does Patri think democracy has become “the current industry standard” for no reason? As it happens, liberal democracies are in fact the best places in the world to live. They are where people are happiest, healthiest, live the longest, and, yes, are most free, And, as it happens, people who live in advanced liberal democracies generally have significant freedom to emigrate. (In non-democracies, not so much.) When they do move, they tend to move to other liberal democracies.

I understand it’s tough for new entrants to break into the government “market,” and that if attractive non-democratic alternatives were to be offered, people with the freedom to choose them might choose them. But insofar as there has been a limited market test, democracy is the decisive champ. So, if Patri really finds a priori identification of the best way to organize society “laughable,” then I don’t understand why he’s entitled to be so confident that “the idea that this ancient Greek technology is the best we’ll ever do [is] absurd.”  It’s this sort of thing that makes me (and others, I’m sure) suspect Patri’s less than wholehearted about the “Let a Thousand Nations Bloom” rhetoric and is in fact a closet ideal theorist who wants a bit of turf on which to demonstrate the superiority of his ideal. Not that there’s anything wrong with that!

Thus even a democraphilic should want competitive government.  It’s not democraphilia or democraphobia which is the key here, but agoraphilia or agoraphobia (meaning markets, not open spaces, of course).  So my challenge to Will, and any other agoraphilic skeptic of competitive government is to resolve this contradiction.  If you generally believes in the power of competition to offer better products to consumers, why is the market for government fundamentally different?

I do want more competitive government! But I’ll persist in complaining that Patri underestimates the extent to which the possibility of competitive government remains, for the forseeable future, largely a political problem and not an engineering one. The question of “why the market for government is fundamentally different” takes us back to anarchist vs. statist ground zero, doesn’t it? But, that aside, my response to the challenge is simply to deny that I am agoraphobic, or that there is a contradiction I need to resolve.

Here’s a question for Patri: Why do you think building some new territory relatively few people will be politically free and economically able to move to will be sufficient to create a “competitive market in government” significantly different than the current “market”? And here’s another: If seasteads converge on forms of democracy not very different from current ones, will you consider this a vindication of familiar forms of democracy or an indictment of imagination?

There’s more in Patri’s post I’d like to respond to, but for now I’ll leave it at that.

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30 thoughts on “Democracy and Markets in Government

  1. I wonder if any seastead proponent actually wants to live on one of these. I suspect the living standard is not very high on the sea.

  2. “I suspect the living standard is not very high on the sea.”Many people probably said the same thing about the American frontier or the desert that became Dubai. A seastead could just keep growing and growing and expanding.

  3. And in fact, many people died at the American frontier, and not only because of wars. Of course, those who survived came to enjoy a vast and fertile land, and in the case of Dubai rich neighbours with oil.

  4. You seem to be focusing primarily on the practical and pragmatic debate, but I think there's a fundamental philosophical disagreement that's more interesting.In you original post, you said: “Thiel does make it sound like he thinks the problem’s not democratic politics per se, but democratic politics without good prospect of producing the right answer. But liberalism starts from the recognition that free and equal people don’t agree about the right answer but need to find a way to live together anyway. The secessionist instinct does seem illiberal insofar as it’s based in the frustration that resonable pluralism fails to generate consensus on the right answer — even when the content of the right answer is a radical version of liberalism.”Although I generally find myself more sympathetic to your view on seasteading than Patri's, my response to this part of your post was very similar to his. It seems to me that there's a confusion of means with ends. There are a lot of valuable ends that I believe we should be striving for: health, happiness, material prosperity, personal autonomy, peaceful coexistence, etc. I like democracy, democracy is good, but ultimately democracy is just a tool for obtaining these other ends. To the extent that a society is better at providing these important ends, it is a better society, irrespective of how democratic it is.Now, I do believe that better societies will tend to have a substantial amount of democracy. But this is just because democracy is a pretty good tool (compared to the alternatives) for bringing about those other ends. Not because democracy, in and of itself, is a good thing.You and Patri both look at American society and see democratic goverance bringing about disgusting results (Patri cites the brutal treatment of nonviolent drug users; I'm sure you could come up with plenty of other examples). Clearly, the tool (democracy) isn't working. You say we need to tweak the tool a bit and learn to use it better. Patri says we should be looking for a different tool entirely. But this is just a pragmatic disagreement, not a disagreement over the nature of democracy.Maybe I'm overreading your post by pulling that quote out of its original context of Thiel's comments on women. If so, I apologize.

  5. Friedman isn't taking this far enough. This idea of Seasteading of another market in governments producing the best of all governments is still a red herring – the value of the idea for Friedman and Thiel could be that it enables a wider selection of governments. My sense is that their first-order preferences for the kind of society they would choose are a distinctly minority opinion, and are likely to remain so under any possible structural arrangement. Maybe Patri and Peter are just plain weird dudes, way out on the tail of certain dispositional distributions.A charitable extension of Thiel's comments about women is that his brand of radical libertarianism (which presumably has some appeal to the readers of Cato Unbound) will always be a minority position, and so the only way to get a jurisdiction that reflects those preferences is radical federalism. It may also be the case that the kind of counter-majoritarian institutions that would keep that society acceptable will inevitably degrade over time, for example because children born there would grow up without necessarily sharing the values, etc. SO maybe the only way to be sure that an acceptable society exist over the long is to create Friedman's perpetual frontier with its dynamic geography. Seasteading is less about creating a system to find the ideal form of government than creating a system that will allow certain minority preferences for government to be fulfilled.Which is just as well, because if I had to place a bet, I'd wager that the structure of a seastead lends itself much more to Dutch-style social democracy than radical classical liberalism. In fact, they sound an awful like the polder model from the actual Netherlands (scroll down to the hedaing “Let's Focus First On”).

  6. Unlike most people, I thought “Waterworld” was an okay movie.But I don't think a sequel is a very good idea.

  7. I would take that bet. The problem with social democracy on a seastead is probably most of the people who make enough that they are net taxpayers will leave, and people with so little money that they would be net tax-receivers will move in. Of course this assumes that the ideal of low barriers to entry/exit remain.

  8. From Will's original post on Democraphobia:Libertarianism does have public relations problems, and it’s not because most people are stupid or immoral. It’s because libertarians have done a terrible job countering the widespread suspicion that it’s a uselessly abstract ahistorical ideology for socially retarded adolescent white guys.I think I would like living in a libertarian utopia that didn't have any actual libertarians. They seem like a real bummer to hang out with.

  9. Maybe, but that final caveat is telling. Friedman's vision is that any group of around 200 or more with the money to spend can launch their own platform – I don't think he makes any provision for unlimited free immigration. On the other end, when your minimum efficient scale is a single platform that supports a few hundred people, egalitarian structures are going to prove much more popular among prospective seasteaders. Network effects amplifysmall differences in initial popularity into large differences in outcomes. That could make Atlantisdam both wealthier and stickier than Galt's Boat. I'd close by way I observing that Friedman and Thiel, who presumably have the resources to be fairly mobile, live in the Bay Area and Manhattan, hardly low-tax havens.But hey, maybe it goes the way you say. There's only one way to find out, and it's that prospect that makes the project so exciting!

  10. I think Boy Friedman's plan is to launch his party boat in San Francisco Bay…easy access to the fruits of democracy + cheap waterfront property.What could go wrong?

  11. I compartmentalize my friends. The nerds seem disproportionately libertarian(ish), and sometimes they are a refreshing alternative to drugs and dancing. I guess I consider them my 'day friends' (day walkers, heh).

  12. Perhaps you should put your real name out in the world so we can start calling you “Boy Smith” or whatever. You can make your points without being a condescending jerk.

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  14. And so when Peter Thiel says that when women got their nanoslice [of political power], the competence of this gigantic committee [i.e. democracy] deteriorated…he is making a factual statement.Perhaps you're aware that the average IQ is 100. Have you ever collaborated with, employed, or otherwise befriended anyone with an IQ of 100? If not, it's never too late to moonlight in “food prep” at your local Hardee's…But 100 is just for average white people! Alas, as you may know, not everyone is white. This Moldbug guy is so charming! I can't decide whether it's his misogyny, his racism, or his self aggrandizement that's more appealing.He actually quotes fucking *Robert Heinlein* in that post. I thought that only happened in parodies of libertarians. Amazing.

  15. “But this is just because democracy is a pretty good tool (compared to the alternatives) for bringing about those other ends. Not because democracy, in and of itself, is a good thing.”Well … considering what the alternatives are, I'd say that Democracy ends up being a little bit more than just a good tool, assuming one takes libertarian principles such as self ownership at all seriously. That's from a minarchist position, of course; one could certainly argue that anarchy is really the only form of government entirely consistant with libertarian principles, but that extreme is rejected by most libertarians for consequentialist reasons.Or maybe Patri thinks that his “competitive market for government” will spontaneously create some wonderful new form of government never seen before? Markets are indeed pretty powerful, but I think that such a proposition is extremely dubious.(Obviously ideal minarchy, from a libertarian perspective, would have powerful constraints upon just what powers even a democratic majority could confer on the government, but a constrained democracy would still be a democracy.)

  16. I'm curious – does Patri give away the game at any point and reveal his preferred alternative to democracy? Or does he just hide behind his “the market will decide” rhetoric? Afterall, these seasteads are going to have to start from some form of government (or lack thereof). What's his preferred starting point of his experiement?

  17. Okay, read the origiinal piece, which i guess I should have first. What utter nonsense on any number of levels. And he doesn't reveal his starting point preference, which I think is pretty telling.

  18. Under the law, extending the voting franchise was women was the Constitutional and “correct” thing to do. That doesn't at all preclude the notion that extending those rights lead to worse democratic decisions, which it clearly does. I am not a member of a “privileged” class and even I can see this. Just because an ideal of good government is Equal Protection doesn't mean that its practical implementation effectively propagates that ideal. You champion democracy because it appeals to your intuition, all the while steadfastly refusing to engage the empirical data which shows that many “marginalized” groups tend to have worse ideas on legions of political issues from economics to the environment to schooling. That's not going go away no matter how much Wilkinson thinks he can armchair reason to an effective libertarianism from first principles. I don't think sea steading is a good answer to the predatory state, but pretending that political agitprop is capable of overcoming our genetic biases (which vary amongst demographics) is just as quixotic and stupid as statist-liberal “activism”.

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  20. Under the law, extending the voting franchise was women was the Constitutional and “correct” thing to do. That doesn't at all preclude the notion that extending those rights lead to worse democratic decisions, which it clearly does. I am not a member of a “privileged” class and even I can see this. Just because an ideal of good government is Equal Protection doesn't mean that its practical implementation effectively propagates that ideal. You champion democracy because it appeals to your intuition, all the while steadfastly refusing to engage the empirical data which shows that many “marginalized” groups tend to have worse ideas on legions of political issues from economics to the environment to schooling. That's not going go away no matter how much Wilkinson thinks he can armchair reason to an effective libertarianism from first principles. I don't think sea steading is a good answer to the predatory state, but pretending that political agitprop is capable of overcoming our genetic biases (which vary amongst demographics) is just as quixotic and stupid as statist-liberal “activism”.

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