There is always already coercion

One of the commentators I regularly follow, is Dale Carrico, who is of the opinion that no realistic political theory can be held, which ignores the role of violence and coercion as inherent in the human condition.

I agree, and this is how P2P Theory differs from the libertarian tradition.

The following excerpt is from a long piece, that I believe originates from within the libertarian environment, which nevertheless very much goes into the same conviction that coercion is a reality that needs to be dealt with. This is important, as for example neoclassical economic theory, and many strands of libertarianism, start from the assumption that we are already free, and build their theories on that fundamentally false assumption.

The entry I’m referring too, which is quite long, argues against the reality of Coase’s theorem on transactional costs, which is often used by for example Yochai Benkler. But the concluding part, is interesting in the context of a discussion of the state. In summary, no emancipation can be conceived on the basis of any assumption that we are already free, but on the contrary, the right kind of institutional framework is required.

From the unenumerated blog:

It is usually the case with coercion, as here, that it is far cheaper for the coercer to cause harm than for the victim to prevent it. To increase the threatened harm to the farmer, and thus the revenue it can obtain from extortive bargaining with the farmer, the railroad can spend extra to purposefully threaten the farmer. Here, it is likely far cheaper for the railroad to install a super spark emitter, or a flamethrower, than for the farmer to defend his fields from these sources. Indeed, since any prior allocation is possible, why stop with the farmer’s fields? Another possible allocation would give the railroad a right to torch the farmer’s barns, and his house, to kidnap his children — any prior (ex ante) set of rules is supposed to be possible. In turn, if the ex ante rules allow, the farmer could threaten to tear up the railroad tracks or sabotage them to derail the trains. Under all these prior allocations of rights that allow coercion, the railroad need not just bargain to avoid the costs of supressing its externality (whether sparks or flamethrowers), nor need the farmer bargain just within this artificially voluntary spectrum of possibilities that Coase and his followers assume. Instead, if the ex ante rules so allow the railroad and farmer will bargain to avoid a negative-sum outcome: harm to the farmer with no direct benefit to the railroad, or vice versa. Since there are substantial ex post benefits to one party from extorting payments from the other, the party that can threaten the most harm at the least cost to itself has, if the ex ante rules allow, a strong economic incentive to engage in such coercion. These negative-sum games of coercion and extortion lead to highly inefficient outcomes, and they can only be avoided by carefully crafting the ex ante rules to avoid such coercion and extortion. These coercive threats that make negative-sum games possible, and that decrease the payoffs of positive-sum games, cannot be neatly distinguished in practice from innocent externalities: any act or omission of one party that harms another, i.e. any externality, doubles as a threat, whether a tiny threat or a large threat, from which an extortion premium, its size depending on the size of the threat, can be extracted.

In order to try to distinguish coercion, and the extortion it gives rise to, from an “innocent” externality that can be cured by efficient bargaining, there are ways to exclude some of these extreme possibilities from the prior allocation of rights. And indeed criminal and tort law do this: they distinguish purposeful behavior from negligent, and negligent from the mere unfortunate accident. But any such ex ante distiction contradicts the claim that the Coase Theorem applies to any prior allocation of rights. Voluntary bargaining cannnot give rise to tort and criminal law. Quite the opposite is true: at least a basic tort law is necessary to make voluntary bargaining possible. Tort law (and the associated property law which defines boundaries for the tort of trespass) is logically prior to contract law: good contracts depend on good tort and property law. Without a good tort law already in place, nobody, including the “protection firms” posited by anarcho-capitalism, can engage in the voluntary bargains that are necessary for efficient outcomes.

This is not to claim that the polar opposite of anarcho-capitalism must be true, i.e. that “the government” along the lines we are familiar with is necessary. Instead, a system of political property rights that is unbundled and decentralized is possible, and may give rise to many of the benefits (e.g. peaceful competition between jurisdictions) promised by anarcho-capitalism. But political property rights are not based on a Rothbardian assumption of voluntary agreement — instead, in these systems the procedural law of political property rights, as well as much of substantive property rights and tort law, is prior to contract law, and their origin necessarily involves some degree of coercion. Political and legal systems have not, do not, and cannot originate solely from voluntary contract. Both traditional “social contract” justifications of the state and the Rothbardian idea that contracts can substitute for the state are false: in all cases coercion is involved, both at the origin and in the ongoing practice of legal procedure. In both cases the term “contract” is used, implying voluntary agreement, when the term “treaty”, a kind of agreement often forced by coercion, would far more accurately describe the reality. The real task for libertarians and other defenders of sound economics and law is not to try to devise law from purely voluntary origins, an impossible task, but to make sure the ex ante laws make voluntary bargaining possible and discourage coercion and extortion (by any party, including political property rights holders or governments) as much as possible.”

2 Comments There is always already coercion

  1. Pingback: P2P Foundation Echoing Hayek and Toffler « Chief Outhouse Correspondent

  2. Kevin CarsonKevin Carson

    Most libertarians who oppose coercion as a matter of principle acknowledge the need for some preexisting (or at least logically prior) social consensus by which legitimate (defensive) force can be distinguished from illegitimate (aggressive) force. That would include property rules (in Nozick’s schema, rules for 1) initial appropriation, 2) transfer, and 3) abandonment). It would also include conventions for defining fraud, implied contracts, and so forth. In the traditional common law, such things as fraud were generally defined in terms of the “reasonable expectations” of the public in a given jurisdiction. For example, someone advertising something for sale as “bread” is making an implied promise that it fits the usual specifications of bread, under local convention.

    I’ve seen some libertarians who give the Law Merchant as an example of an autonomous system of law that evolved outside the state.

    One libertarian thinker, “quasibill” of The Bell Tower blog, takes a very minimalist view of the amount of contract law that could be coercively enforced. In the case of bankruptcy, for example, he starts from Rothbard’s assumption that compelling specific performance is a form of slavery. But he takes it further, arguing that it is virtually impossible to prove, in the event of default, fraudulent intent at the outset. So essentially, in almost all cases, he would regard arranging adequate security, requiring default insurance on the debtor’s part, etc., as the creditor’s responsibility, and consider default just another part of the business risk.

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