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A Further Thought on Voluntary Versus Involuntary Economic Theory

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November 04, 2010 – Comments (44)

Lately I have alluded to the idea that the core of mainstream economic theory is the concept of involuntary exchange.  In other words, without some form of coercion taken as a given, modern economic theory does not hold true. 

Another area with this relationship between involuntary exchange and modern economics can be clearly seen is government deficits.  I'm not talking about specific sizes of the deficit - whether a larger or smaller one is better - and I'm not talking about peculiar accounting identities that lead some economists to wrongly assume that private savings and public deficits are somehow linked. I'm speaking of the implications of the policy of having a government deficit in the first palce.

Consider the following premise:

Every individual has an inalienable will.

This a conclusion inferred by the fact that each person has unique characteristics and occupies a certain point in time at any moment, and no other. 

"Since man’s personal will is inalienable, he cannot, in a voluntary society, be compelled to work for another against his present will, and therefore no contracts can be made for purchase of his future will." - Murray Rothbard. Man, Economy, and State. p. 201

In other words, you are free to make all the promises that you want, even to promise yourself into permanent bondage, but in a free society I cannot compel you to bondage at some point in the future based on that promise.  You might change your mind, and since you have not collected any of my property (e.g. money) based on your promise, you make no invasion of my property by breaking your promise.

So if I can't hold you to future bondage based on a promise you made to me, it certainly also follows that a third party cannot hold you to future bondage either despite any promises you have made.

Nor can any third party obligate you to future unspecified work without your consent. 

I'll conclude here, since I am pressed for time.  A government debt contract -no matter how large or small - must be paid in the future through the unspecified labor of future citizens.  Whether the citizen voted for the deficit hiker or not is irrelevant, since mere promises made in a voluntary society are only that - promises - and nothing more.  Therefore, the only way that government deficits can be satisfied is by the involuntary labor performed by future generations of the country's citizens.

Perhaps this might help you understand why Greek citizens today are not very keen on the idea of fulfilling promises made by previous generations of Greek citizens.  Present day Greeks rightfully consider these promises invalid (whether or not present day Greeks fully understand the folly and and engage in their own promise-making.)

Any theory that attempts to analyze the impact of public deficits - either using theoretical or empirical study - without considering the involuntary nature of the deficit and the implicit assumption of future bondage based on a mere promise, is a theory that accepts coercion as a given, a necessity, and perhaps even as a benefit.

I reject any economic theory based on an implicit assumption of coercion.  And I reject any promises made on my behalf that compel either myself or others to perform unspecified labor at a future date.

David in Qatar

44 Comments – Post Your Own

#1) On November 04, 2010 at 7:08 AM, devoish (98.44) wrote:

Cool.

I reject any contracts made between partys other than myself that say you own anything I want to use.

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#2) On November 04, 2010 at 7:22 AM, whereaminow (21.88) wrote:

I reject any contracts made between partys other than myself that say you own anything I want to use.

You are free to hold that opinion.  The problem will arise when you attempt to act on it. 

Let's say for instance that Joe enters into a contract to buy Mary's house.  Since you want to use Mary's house (now belonging to Joe) and you reject Joe and Mary's contract, how do you propose to fulfill your wish?

Daivd in Qatar

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#3) On November 04, 2010 at 8:01 AM, ChrisGraley (29.73) wrote:

Cool,

I do not reject the possibility of shooting someone trying to confiscate my property in the head.

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#4) On November 04, 2010 at 8:10 AM, Valyooo (99.44) wrote:

I think what devoish meant is that its not fair that you got your hands on a property before he was born (in some cases) and he rightfully wants to use it since he never had the chance in the past

How did land ownership ever even start? The earth wasn't created with house deeds entitled to people already

Couldve misunderstood it though

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#5) On November 04, 2010 at 8:34 AM, whereaminow (21.88) wrote:

Valyooo,

How did land ownership ever even start?

Attempting to work that out logically, all nature-given factors had to have a first owner - a person that initially mixed his labor with the nature-given factor.  Land, economically speaking, is any nature-given resource. 

Is it possible that many nature-given factors were acquired, not through this homesteading process, but rather through violence or fraud?  Certainly.  Of course, that doesn't invalidate legitimate contracts between two parties that enter into a voluntary exchange for mutual benefit.

It doesn't seem likely that disregarding all contracts for all nature-given factors that I might want to use - simply because of those factors may have had illegitimate owners, past or present - would produce a better society.  That would simply produce even more illegitimately owned property.

David in Qatar

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#6) On November 04, 2010 at 8:43 AM, devoish (98.44) wrote:

Make it a clean shot please. It is pretty quick how a perceived lack of government devolves into success for the quickest to turn violent and is detrimental to those who would use their time being productive.

Valyooo,

That would be one example. If David does not want the costs of Government, but does not discuss the benefits, including the enforcement of contracts between individuals.

"Taxes are the price we pay for civilization" - Justice Oliver Wendell Holmes

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#7) On November 04, 2010 at 8:46 AM, whereaminow (21.88) wrote:

devo,

It is pretty quick how a perceived lack of government devolves into success for the quickest to turn violent and is detrimental to those who would use their time being productive.

But good sir, since this is clearly related to your previous statement, I asked you very specifically how do you plan on acting on your desire to use property that is owned by others?

David in Qatar

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#8) On November 04, 2010 at 8:52 AM, whereaminow (21.88) wrote:

"Taxes are the price we pay for civilization" - Justice Oliver Wendell Holmes

Justice Oliver Wendell Holmes did not pay taxes.  He was a net tax consumer.  So what he really meant was taxes are the price you pay to have him arbitrate society for you.  There is no reason for obfuscating such an obvious fact.  Perhaps it is better to have Mr. Holmes arbitrate such important matters.  There is no excuse, however, for tawdry nonsense that implies he sacrifices as much as the common man. 

David in Qatar

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#9) On November 04, 2010 at 8:57 AM, devoish (98.44) wrote:

Is it possible that many nature-given factors were acquired, not through this homesteading process, but rather through violence or fraud?  Certainly.  Of course, that doesn't invalidate legitimate contracts between two parties that enter into a voluntary exchange for mutual benefit. - David

So what you are saying is that if Jim steals Tom's property at the point of a gun, and sells that property to Paul, that sale becomes legitimate. Leaving Tom robbed, Paul "legitimately" with Tom's property. Jim "legitimately" with Pauls gold, and the ability to "legitimately" purchase property with the profit he made stealing from Tom.

You must be a banker.

Steven

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#10) On November 04, 2010 at 9:09 AM, whereaminow (21.88) wrote:

devo, 

So what you are saying is that if Jim steals Tom's property at the point of a gun, and sells that property to Paul, that sale becomes legitimate

Absolutely classic.  What you have just descibed is exactly how the government handles such a case.  It's called a "negotiable" good, and according to US courts the responsibility to recover losses falls on Tom. 

In a free society, Paul's property belongs to Tom.  It is now up to Paul whether or not he wants to pursue damages against Jim for fraud, not Tom.  Judging by comment #9, maybe we have the first instance where you prefer a free market solution to a government solution lol?

"There could be no room, in a free society such as we have outlined, for “negotiable instruments.” Where the government designates a good as “negotiable,” if A steals it from B and then sells it to C without the latter’s knowledge of the theft, B cannot take the good back from C. Despite the fact that A was a thief and had no proper title to the good, C is decreed to be the legitimate owner, and B has no way of regaining his property. The law of negotiability is evidently a clear infringement of property right. Where property rights are fully defended, theft cannot be compounded in this manner. The buyer would have to purchase at his own risk and make sure that the good is not stolen; if he nonetheless does buy stolen goods, he must try to obtain restitution from the thief, and not at the expense of the rightful owner." - Ibid, p. 181

Why haven't you answered my question?  How are you going to act on your wish to violate Mary and Joe's contract in comment #2? 

David in Qatar

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#11) On November 04, 2010 at 9:18 AM, starbucks4ever (97.92) wrote:

You do a good job defending the legal aspect of freedom, but you downplay the importance of its economic aspect. Freedom without a million dollars is pretty much worthless.

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#12) On November 04, 2010 at 9:28 AM, whereaminow (21.88) wrote:

zloj,

Isn't that a value judgment?  People claim to fight (and die) for freedom all the time.  Even if we concede a lack of ideological sophistication among those "freedom fighters", it doesn't necessarily follow that their efforts are worthless because they weren't going to be millionaires.

David in Qatar

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#13) On November 04, 2010 at 9:46 AM, starbucks4ever (97.92) wrote:

Why should freedom and wealth be opposed to one another? Can't I have both?

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#14) On November 04, 2010 at 10:44 AM, whereaminow (21.88) wrote:

zloj,

LOL, who would I be to prevent such happiness?

David in Qatar  

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#15) On November 04, 2010 at 11:03 AM, MegaEurope (< 20) wrote:

So since Rothbard says my future self is a different person than my current self, I should be able get out of signed contracts whenever I feel like it?

It seems like I don't need to abide by my employment contract/non-disclosure agreement/marriage vows/mortgage/etc.  Those all involve some degree of "bondage".

Voluntary vs involuntary entered contracts is a much stronger idea than current vs future selves.

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#16) On November 04, 2010 at 11:18 AM, whereaminow (21.88) wrote:

MegaEurope,

So since Rothbard says my future self is a different person than my current self, I should be able get out of signed contracts whenever I feel like it.

No, Rothbard says your will is inalienable.  As long as you don't accept property in return, then yes, you cannot be compelled to perform services which you promised to deliver.  You're a loser, but being a loser is not a crime. You have not violated anyone else's rights.  Did you take any money for your promise to perform future labor?  If the answer is no, then it is merely a promise whether you chisel it in stone or sign it in blood.

It seems like I don't need to abide by my employment contract/non-disclosure agreement/marriage vows/mortgage/etc 

You accept property (money) in exchange for your employment.  If you cease that employment, you have no claim on future pay.  If you received pay in advance, you owe it.  How is that hard to understand?

As for marriage vows, that is a religious discussion, not an economic one.  In a free society, there is no compulsory marriage vows.  Among members of a religious institution they may feel differently, but they can't impose those values on members of a free society.  Again, that's discussed in the same book.

Voluntary vs involuntary entered contracts is a much stronger idea than current vs future selves 

I have no idea what you mean.

David in Qatar 

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#17) On November 04, 2010 at 11:23 AM, whereaminow (21.88) wrote:

How in the world did you conclude that Rothbard feels that mortgage debtors do not have to fulfill debt obligations?  If they stay in the house but don't make the payments, they are clearly invading another's property rights.

And if you could indicate a case where someone has been locked in jail for breaking a promise, with no property exchanging hands, let me know.

Do you see the difference?

David in Qatar 

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#18) On November 04, 2010 at 11:25 AM, devoish (98.44) wrote:

Let's say for instance that Joe enters into a contract to buy Mary's house.  Since you want to use Mary's house (now belonging to Joe) and you reject Joe and Mary's contract, how do you propose to fulfill your wish?

It is not Joe's house.

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#19) On November 04, 2010 at 11:33 AM, whereaminow (21.88) wrote:

devoish,

It is not Joe's house

First, that doesn't answer my question. It is still merely your opinion.  How do you propose to fulfill your wish to use that house?

Second, how did you acquire your current house? 

David in Qatar 

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#20) On November 04, 2010 at 12:04 PM, MegaEurope (< 20) wrote:

If you received pay in advance, you owe it.

What if I enter into a contract that says I need to pay back 120% of advance pay if I break it?  Do you think that's valid?

I don't think voluntarily entered contracts without any possible benefit for one of the parties are a significant real-world issue.

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#21) On November 04, 2010 at 12:13 PM, MegaEurope (< 20) wrote:

There are ways to get out of employment contracts, mortgages, marriages, etc.  But either the contract or the law governs how it must be broken.  The idea of unilateral nullification is simplistic and impractical.

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#22) On November 04, 2010 at 1:00 PM, whereaminow (21.88) wrote:

What if I enter into a contract that says I need to pay back 120% of advance pay if I break it?  Do you think that's valid? 

Why wouldn't I?  You accepted a payment that was negotiated.

I don't think voluntarily entered contracts without any possible benefit for one of the parties are a significant real-world issue. 

Then why are you fretting about it?  Where did I say they were?Can you point to the exact quote in my post where I say that?  I don't think they either, nor does Rothbard.   Nor does anyone.  What's your point? 

There are ways to get out of employment contracts, mortgages, marriages, etc.  But either the contract or the law governs how it must be broken.  The idea of unilateral nullification is simplistic and impractical.

What is simplistic and impractical is your approach to understanding free market ideas.  For starters, you need to stop inserting your prejudice into my words. I never said, nor did Rothbard ever say that a mortgage is invalid, that interest is invalid, etc.  In fact, if I wasn't so lazy, I'd pull MES back up and pull the direct quotes explaining why interest enters into markets and its relation to property rights.

If you neighbor's kid offers to mow your lawn next weekend, but then doesn't show and doesn't collect the money, let me know how long his jail sentence ends up being.

I just don't see what is so hard to understand.  You are either being intentionally dense, or you have lowered yourself to troll status.  A person cannot be compelled to labor upon a future date on a mere promise.  And the underlying assumption of any economic theory that promotes deficit spending is that they can.

Obviously, this conclusion bothers you, perhaps due to your political beliefs.  But instead than addressing that, you would rather put words in my mouth and snide remarks.  Shall we do that dance again?  I really don't want to, but I will.

David in Qatar 

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#23) On November 04, 2010 at 1:29 PM, MegaEurope (< 20) wrote:

Then why are you fretting about it?

...

If you neighbor's kid offers to mow your lawn next weekend, but then doesn't show and doesn't collect the money, let me know how long his jail sentence ends up being.

Because you keep giving examples of it, suggesting you think they are meaningful.

 

A person cannot be compelled to labor upon a future date on a mere promise.

Sure.  But if they sign a contract which they later want to break (regardless of the status of payment), I think they should have to follow the terms of the contract in order to break it.

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#24) On November 04, 2010 at 1:38 PM, whereaminow (21.88) wrote:

Because you keep giving examples of it, suggesting you think they are meaningful.

The very point is that they are not meaningful.  Just as any promises to compel people to labor to finance deficit spending are not meaningful.  

Sure.  But if they sign a contract which they later want to break (regardless of the status of payment), I think they should have to follow the terms of the contract in order to break it. 

I think they should too. But it's not a crime to be a loser. Nor can you compel a person, by force, to fulfill such a contract if they have not received any payment. 

David in Qatar 

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#25) On November 04, 2010 at 1:55 PM, MegaEurope (< 20) wrote:

So is it accurate to say that you think a contract is only valid at the point when money changes hands, not the point when it is signed?

I don't think this follows at all from your other assumptions.  And it is not really a common sense interpretation of how contracts should work.

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#26) On November 04, 2010 at 2:16 PM, whereaminow (21.88) wrote:

So is it accurate to say that you think a contract is only valid at the point when money changes hands, not the point when it is signed?

Replace the word valid with enforceable.

I don't think this follows at all from your other assumptions 

Not assumptions, conclusions based on property rights and a person's inalienable will.

And it is not really a common sense interpretation of how contracts should work. 

If you think it's common sense to throw someone in prison or compel someone into bondage for a promise where no exchange is made, LOL, well OK I guess I won't waste my time with this conversation.

David in Qatar 

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#27) On November 04, 2010 at 3:44 PM, MegaEurope (< 20) wrote:

OK, I will make one final point.  If someone is willing to accept my word to begin a contract (payment to follow depending on the conditions of the contract), who are you to contradict the market and say that my word is not a valuable thing (like money)?

Since you evidently prefer to have discussions only with people who agree with you, I will give you my word that I will no longer post in your blogs.

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#28) On November 04, 2010 at 3:51 PM, whereaminow (21.88) wrote:

Once again, you've got it backward, but I suppose I shouldn't expect any differently.  Pretty much on everything you've said here, including who I prefer to have discussions with.

I don't know if you just refuse to understand a simple concept or you truly can't grasp it.

If someone is willing to accept my word to begin a contract (payment to follow depending on the conditions of the contract), who are you to contradict the market and say that my word is not a valuable thing (like money)? 

I'm NOT contradicting the market.  You can make all of these types of contracts you desire.  And if the person is as good as their word (and that's what's important right?) then you should never have any difficulties. And God Bless ya for it, since if a man isn't worth his word, he isn't worth anything.  

Since you evidently prefer to have discussions only with people who agree with you, I will give you my word that I will no longer post in your blogs. 

You must be giving up for other reasons, since the overwhelming history of my interaction with commenters on this site is with people I disagree with. 

David in Qatar 

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#29) On November 04, 2010 at 8:49 PM, devoish (98.44) wrote:

First, that doesn't answer my question. It is still merely your opinion.  How do you propose to fulfill your wish to use that house?

 My opinion counts. Through the doorways.

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#30) On November 04, 2010 at 9:36 PM, whereaminow (21.88) wrote:

I know this is condescending and rude to say, but what else can I do at this point?

There are intelligent, sophisticated arguments that a liberal could make here.  I expected them.  I didn't expect mindless nonsense. I certainly hope that you and MegaEurope are not representative of the critical thinking ability of today's liberals.

Between 15-20 comments or so, neither of you has made a single point.  We have Mega unable to comprehend the logical step that 1) A promise with no exchange of property is just a promise, so 2) No force can be used to extract labor on said promise, so 3) Any force used to coerce future generations to pay for other people's debts is a violation of their inalienable wills.  And then we have devo, who doesn't see home invasion as aggression - an initiation of violence - when he hasn't 1) shown how the voluntary transaction between the party stated was illegitimate, or 2) from what legitimacy his claim on the property derives.

It must be society's fault.

Thanks for the laughs guys. You are truly clowns. 

David in Qatar 

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#31) On November 04, 2010 at 10:52 PM, devoish (98.44) wrote:

David,

I do not believe that you or Mary and Tom should have any expectation that I honor a contract that I was not party to.

 

 

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#32) On November 04, 2010 at 11:09 PM, starbucks4ever (97.92) wrote:

whereaminow,

If you are consistent with your refusal to saddle future generations with contracts they were not party to, I expect you to be logical and demand redistribution of private land among each new generation (as they actually did in peasant communes). The new generation must still respect private rights to buildings and other improvements made by their ancestors, but they must not respect private ownership of raw land because they were not parties to the contract when that raw land was privatized.

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#33) On November 05, 2010 at 1:04 AM, tekennedy (73.01) wrote:

Interesting point. 

"Therefore, the only way that government deficits can be satisfied is by the involuntary labor performed by future generations of the country's citizens."

I would contend any labor performed is to a greater or lesser extent voluntary as each individual has the ability to leave (which is a fair arguement for the growth of power of state while diminishing the federal power giving people more options).  Another point I would like to make would be that an individual does consent with certain actions such as getting a job, purchasing goods, or any other taxable action. 

"...since you have not collected any of my property (e.g. money) based on your promise, you make no invasion of my property by breaking your promise." 

Another point worth making is that there is an implied agreement with the government from the use of their services which require up front investment.  The use of debt would rightfully be used to fund its creation when future generations gain benefit.  You would therefore be invading government  property (roads, state government buildings) without payment of this debt. 

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#34) On November 05, 2010 at 4:45 PM, rfaramir (29.32) wrote:

devoish: "I do not believe that you or Mary and Tom [sic] should have any expectation that I honor a contract that I was not party to."

That's David's point entirely! With regard to government debt requiring payment by future generations.

With regard to Mary and Joe's agreement, you may perhaps get away with not acknowledging their contract, but you do have to respect other people's property. It surely isn't YOUR property, so it must be someone else's (unless it is evidently unowned and therefore homesteadable). Whether you respect other people's agreements only affects whether the property is Joe's or Mary's, not whether it is yours, which it isn't. Wanting someone else's property, declaring it to be yours just because you want it, and then taking it is the path of the bully or gangster.

Don't go through that doorway uninvited, a man's home is his castle, and Joe may shoot you with impunity. I love Texas! (If they aren't in Texas, they should be, lol!)

David in Qatar, you've been long suffering. The only thing in their defense is that it took you til #30 to actually put forward your argument in succinct logic. They ought to have understood you from the beginning, but they have no excuse, now.

IANAL, but it is said to be true that without a consideration (payment of some kind) passing between them, a contract is not enforceable. Surprised me, too, but it makes sense.

@MegoEurope, you're right that if you work you should be paid, because that work you did *is* consideration that the employer received, making the contract enforcable. You're wrong that your word is (enforceably) valuable. It *should* be valuable, but it's up to you to make it so, not for anyone else to assume so or enforce it.

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#35) On November 05, 2010 at 11:35 PM, whereaminow (21.88) wrote:

zloj,

Thank you for coming by and raising the discussion back up to a reasonable level.

My objection is based upon the involuntary nature of public debt obligations, not on any voluntary exchanges made in the past.  So I cannot advocate any forced redibstribution of past property.  However, if everyone in the community agreed to such a plan, I would have no objection.

In a case where title was claimed illegitimately, I do support returning that land to a rightful owner.  However, I know of only one clear cut case where this applies: slave ownership.  Lands in the South where worked by slaves, therefore they (and their descedents) have a homesteading claim.  The ownership of the slave owners (and their descedents) is illegitimate as they engaged in coercion to exploit the nature-given factors of land and labor.  The failure to properly enforce this fundamental tenet of liberty was perhaps the greatest failure in American government history.

tekennedy,

I would contend any labor performed is to a greater or lesser extent voluntary

I infer from this sentence that you understand there is an element of coercion present in any labor performed.  Otherwise, you could have just said it is voluntary without any qualifications.  The element of coercion is the party taxation, of course, since it is involuntary.

Another point worth making is that there is an implied agreement with the government from the use of their services which require up front investment.  The use of debt would rightfully be used to fund its creation when future generations gain benefit.  You would therefore be invading government  property (roads, state government buildings) without payment of this debt. 

I like to use this example: Let's say that the government outlawed the private production of toilet paper, and replaced it with government manufactured toilet paper.  Are you breaking a libertarian law every time you wipe your butt?  Of course not.  Your ability to engage in voluntary purchase of toilet paper was violated way before you sat down to drop off the kids.

So no one violates any sanctified agreement when they use government services, whether they paid for them or not, if there is no legal alternative.  If you remove the element of choice, the law is merely abitrary whims of government officials.  That's not law, that's a master-slave relationship.

rfaramir,

Thanks for your excellent commentary.  I thought I had been pretty clear from the beginning. 

I find it interesting that the person that was quick to label libertarians as violent, indicates that he would be the first person to engage in violent behavior - through invasion of property - in such a society.  I wonder if he advocates government protection simply because he thinks we are all like him?

As for Mega, this is not the first time that he has come on a post looking to discredit the ideas without fully understanding them or making a point.  Ignorace is bliss, I suppose.

David in Qatar

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#36) On November 06, 2010 at 1:27 AM, devoish (98.44) wrote:

I did not say "libertarian". You did.

Besides, since I don't recognise the contract I was not party to, the first act of violence is any attempt to exclude me from that property.

Your discrediting of Mega is kind of lame. I understand you, and I have decided your opinions are misguided and wrapped in many more words than needed. Possibly Mega understands you too and disagrees, whther that hurts your feelings your or not.

rfaramir, 

Davids argument that he does not have to honor contracts he was not party to, means I don't have to either. Because I was not party to Tom and Mary's contract, the property is public and I can walk on it as I choose. Tom needs to understand that and not shoot me.

Unless for some reason you or David actually think David is tossed out a lemon with the post and he is bound to contracts that were made on his behalf.

For example he says "So I cannot advocate any forced redibstribution of past property.  However, if everyone in the community agreed to such a plan, I would have no objection". Which is the beginning of a negotiation, acknowledging there are circumstances under which he might agree that he is bound to promises he was not party to.

For instance maybe not "everyone" needs to agree. Perhaps a simple majority is enough. Perhaps even better is a large group joined by majority agreements and within that large group, smaller groups that can make their own agreements locally regarding things that do not infringe on the freedom of members outside their locality.

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#37) On November 06, 2010 at 1:51 AM, whereaminow (21.88) wrote:

Davids argument that he does not have to honor contracts he was not party to, means I don't have to either.

Not my argument at all.  Again, 30+ comments into the thread.  You can't grasp simple concepts.  It's incredibly embarrasing.

David in Qatar

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#38) On November 06, 2010 at 5:58 AM, devoish (98.44) wrote:

Ok, so what makes Tom and Marys contract binding upon me?

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#39) On November 06, 2010 at 6:43 AM, whereaminow (21.88) wrote:

devoish,

Thank you for that question.  My faith in humanity is restored.  Whether you agree or not, at least it gives me an opportunity to explain the concept more fully.

The economic theory that I advocate has as one of its fundamental premises the right to own and direct private property. 

There are three formulations of property rights that are possible in any society, free or not:

1. A person has total control over their own property (body, labor, belongings.)
2. A person has some control over their own property, while others have some control of that person's property.
3. A person has no control over their own property, while others have total control, i.e. slavery.

Only option 1 is consistent with a free society. The economic theory that I propose is based on Option 1.  The economic theory of government deficits is based on Option 2.  In order for Option 2 to have any viability there must be a coercive element that can force people into involuntary exchanges.  (For Option 3, obviously, all exchanges are involuntary.)

Under the conditions of Option 1, Tom and Mary have entered into a voluntary contract for the exchange of private property.  Unless you can prove that Mary came about the property originally under conditions that violate the tenets of a free society and can prove that your ownership claim is legitimate, you cannot violate the terms of their contract.  Any attempt to do so is an action of aggression (via home invasion) - a violation of their property rights under a voluntary exchange for mutual benefit. 

By choosing the level of aggression that is acceptable to you, Mary or Tom are justified in responding at a level that is necessary to defend their freedom.  At this poiint, you must weigh the costs of invasive action against the benefit of using property for which you have no claim.

Therefore, what makes Tom and Mary's contract binding upon you in a free society is your subjective evaluation of the costs of violence over alternative uses of your time, energy, and money. 

Choosing to confront the new owner in an aggressive manner is well within the realm of probability.  These valuations happen all the time, both in private and public affairs.  Often times they end up in courts, but occasionally they end up in fights or full-scale wars.

It's possible that you feel such violence is incompatible with your ideals. Since you support Obama, a man that has escalated one war and started another (Pakistan), I have to question that.  All individuals, in every society, make such subjective evaluations.  Obama, like Bush before him, must make a subjective evaluation of the benefit of engaging in conflicts against other uses of the time, energy, and money of American citizens. 

The only difference is that Obama (or Bush) can use coercion to acquire the revenue necessary to engage in these conflicts.  That fact alone skews their value scale, causing violent action to rank higher on their scale than alternatives. This is less an indictment of them as it is an indictment of the public's deference to Authority, allowing a select number of people to wield far too much power than any human should have.

So while you view the libertarian system as impossible, I have the same conclusion about our current system.  It is impossible for any human being with an unlimited access to resources to make a reasonable estimation of the costs of conflict versus other alternative uses.  The subjective valuations that are a feature of human action are impossible with unlimited funds at your disposal. 

David in Qatar

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#40) On November 07, 2010 at 10:29 PM, devoish (98.44) wrote:

Unless you can prove that Mary came about the property originally under conditions that violate the tenets of a free society and can prove that your ownership claim is legitimate, you cannot violate the terms of their contract.

 To whom would I prove my claim?  Or dispute theirs, as I did not actually claim ownership, just that their claim was illegitimate.

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#41) On November 08, 2010 at 12:16 PM, whereaminow (21.88) wrote:

To whom would I prove my claim?  Or dispute theirs, as I did not actually claim ownership, just that their claim was illegitimate.

I guess you are making the assumption that the State is the sole arbitrator of disputes. To assume that a free society would have no law or manner of dispute resolution is an error.

David in Qatar 

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#42) On November 08, 2010 at 3:16 PM, rfaramir (29.32) wrote:

devoish: "To whom would I prove my claim?  Or dispute theirs, as I did not actually claim ownership, just that their claim was illegitimate."

When you stepped onto the property you claimed ownership of it. Private property is not open for all to walk upon. (Not even all so-called public property is--try strolling onto your local military installation.) By claiming right to use, you are claiming ownership, as that is the fundamental definition of ownership. You can get a right to use without owning, but you get it through a contract with the owner, who may negotiate that right with others. The owner has first right of use (and control in general, not just use).

To whom would you prove your claim? To the occupant and claimed owner, of course. If have convincing evidence, they may agree it was yours before Mary stole it from you. If they don't agree, you must go to a mutually agreed arbitrator to get a decision rendered. If you don't succeed in arbitration, it will be your word against theirs in the court of public opinion. You can badmouth them until your reputation or theirs takes a decisive body blow, or you can invade their property and take your chances with your life.

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#43) On November 08, 2010 at 4:55 PM, devoish (98.44) wrote:

David,

You are correct. I am asking you what steps in for "state", thatis recognised and still not "state".

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#44) On November 09, 2010 at 9:04 PM, whereaminow (21.88) wrote:

devoish,

A State is defined as a comparative advantage in violence in a given geographical territory.  It has a monopoly on retribution, security, arbitration, and legislation (and often, many other services, e.g. money production.)

A free society would not have a State. Therefore, there would be competition in those areas, and others.

What steps in for a State is competition. You would have a choice among companies to which you could bring your claim. The stronger your claim, the more likely a respected abitrator would take a look at it, and you might actually get somewhere.  But we are into serious hypothetical territory at that point.  Some people (like Walter Block and Robert Murphy) would be willing to speculate about this stuff on and on.  I simply can't. 

The fact is that you would have choices which are unavailable to you today, and how those forces of competition would ultimately reshape the market for services now monopolized by government is unknown, just as no one can predict what firms and business models will come to dominate a new market.   

David in Qatar

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