On 3/24/99 Bill Brown wrote:
>...we should stick with limited, constitutional government because we can
>build one that will work fairly well. I am not in favor of an anarcho-
>capitalist system of government because we have no idea how it will
>really behave, and the potential for catastrophic problems seems large.
>So, my preference is for a single weak government that can be constrained
>with well-understood tools. I don't favor anarcho-capitalist schemes
>because I do not believe that the market is capable of constraining
>violence, and I expect that police corporations of any kind would simply
>grow into a new kind of police state.
Perhaps we should consider some sort of hybrid. Consider a government with only two functions: national defense and meta-contract enforcement. Interactions between individuals and most firms would be handled by private protection agencies (PPAs). The government would concern itself with PPA-turns-into-hostile-army scenarios, and with choice of law enforced via a single transferable asset ("money").
Your PPA bothering you? Did you clearly contract with them and specify an arbitrator? If so, the only possible government law issue is whether the arbitrator's judgement was carried out. If the arbitrator says it wasn't, a monetary fine or transfer might be imposed on the PPA. Is it not clear which PPA you contracted with? The government isn't going to allow much subtly here. Did you sign that contract? OK, good enough for us.
Does some PPA seems to have turned into an army threatening national security? Well that's something the government must be concerned with. What, you say its just sour grapes from your competitors? This gets tricker to judge. But if the complaining locals at the border of the "territory" where you are the main PPA all seem free to leave with most assets, the case against you will seem weaker. And strong "lockin" by customers might make the case against you stronger. It would be "anti-trust" law at the PPA level, ensuring competition at perhaps some expense in economies of scale.
Oh, and the government would also have to impose some taxes to pay for that national defense and ability to impose judgements on PPAs. Here I'd prefer a very simple stable tax rule, perhaps a property tax.
email@example.com http://hanson.berkeley.edu/ RWJF Health Policy Scholar FAX: 510-643-8614140 Warren Hall, UC Berkeley, CA 94720-7360 510-643-1884 after 8/99: Assist. Prof. Economics, George Mason Univ.