Libertarianism FAQ @libertarianism 0

by sidstuff and contributors, CC BY 4.0 (Why?)

Many defenses of libertarianism rely too much on notions of freedom and appeal only to those already libertarians. This FAQ aims to provide an introduction to and watertight defense of libertarianism acceptable to nearly everybody.

It is meant to be read from beginning to end for its arguments to be convincing. Answer people's questions by pasting excerpts from it, then strongly recomend reading it in full. The past should not hold back the future; section numbers, names, and contents may be changed.

Contribute by opening issues and pull requests at github.com/sidstuff/libertarianism.

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Looking for studies, literature, quotes, and statistics to cite, well-informed libertarians, please contribute.

Memes are welcome as well, but only if it conveys without insults or hyperbole, an airtight argument. Humor should not come at the cost of the message and its accuracy.

Banning data/information and its use, literal 0s and 1s, is not just a violation of the free market, but of liberty itself. It is nothing short of tyranny. Keep in mind that by the law of supply and demand, data once created has no monetary value, since it can be duplicated infinitely. Any such value is thus something artificially maintained by the state using force to restrict its duplication. It lets companies charge whatever price they want for data and products built using said data, without competition for decades, which is terrible.

The justification given for such an infringement upon our freedoms is that it promotes creativity and innovation. We will discuss how in today's world, the idea that art and science would be significantly hindered without IP protections is untrue. The aforementioned monopoly caused by IP is a much worse effect than any benefits it may possibly have.

Firstly, it's actually legal in the US to yell fire in a theatre, and their theatres seem fine. Anyway, theatres just legally requiring customers not to make disruptions would have the exact same effect as the government banning it.

If you're literally penniless and need immediate funds, see the section on welfare. Only join companies that allow employees to unionize. Or find funding and form a cooperative. If enough people join the union that there aren't enough ununionized empoyees left, the employers will have no choice. If that is not the case, either the conditions must not be so bad, or there are more people than needed in the industry, which means some people need to leave and libertarianism is just preventing wasted human effort.

At first glance, it would seem pretty ironic for an FAQ that lambasts intellectual property rights to place restrictions on its own distribution, even if just attribution. But asking for attribution is consistent with libertarianism.

It is to prevent people passing this FAQ off as their own work, as they could get social/monetary benefits from doing so, and that should be considered fraud. Even if they don't explicitly claim to be the author when using its contents, that is likely to be assumed by most readers, so not explicitly disclaiming it should be treated as fraud.

This does not mean that anyone who doesn't provide attribution must be sued into oblivion; the punishment must be proportional to the crime, after all, and in most cases, any personal clout gained from omitting attribution will be negligible. But for the very few cases where it's not, the license facilitates the prosecution of such fraud in the current legal system.

If simply concerned about wild species going extinct, and not their their occasional mistreatment (which is discussed above), species will be conserved by the free market to the extent that there is interest in them and the ecosystems that they support, eg., in zoos, wildlife tourism, forest products, etc.

If the wages for a profession seem too low, it's because there are too many workers in the industry – the free market is just disincentivizing wasted human effort. Leave the job – if you have no other skills, invest in education. If enough people do, wages should rise. Of course, wages won't go beyond the profit each worker can generate, but that shouldn't be the limiting factor for the vast majority of jobs. If it is, and not enough people are willing to work for those wages, the companies will have to come up with some way of improving worker productivity.

When you enter a building, buy a product, or avail a service, you have a reasonable assumption of safety and efficacy. If this is not true, not providing a clear warning is fraud. Private organizations that verify the same will naturally pop up. Obviously, them making false assurances would be fraud as well.

Anarcho-capitalists advocate for private (self/community/corporate) enforcement of the NAP, thus eliminating the government entirely. Doubts as to whether this will leave more people unprotected than a government solution keep people from supporting it, but this minarchist FAQ can be extended into an ancap one if/when sufficiently convincing arguments are collected.

Besides the libertarian argument that one has the right to transfer their property to anyone they want, including their family, note that children have been raised and molded by the parent from birth, knowing that they will inherit the family business. As weird as it might seem, simply consider them a continuation of the dead parent; they will now continue administering the business. Then the same arguments as above for respecting private property apply.

This is an unsolvable problem because there's no way to extract large amounts of value from a person without cruelty, and even with cruelty, there's a limit to how much you can extract.

Let's say company X spends $14M to discover a much better production method, and starts using it to sell cheaper/better goods in the market. Big company Y decides to spend tens of millions to discover it themselves, and at great speed, hiring many scientists, and conducting lots of trials simultaneously. It looks like it'll take Y only 60 weeks to make the discovery, and 20 weeks to bring it to production.

Within that time, X realizes they won't be able to make $14M profit. So they decide to sell the discovery to Y for $12–14M on the condition that Y waits 40 weeks before launching the product. Y agrees, because they save time and money. During those 40 weeks, X makes $6M profit, bringing their total to $18–20M. The $4–6M is a more than excellent return for the time X spent discovering it.

Now that both X and Y have the discovery, they can either compete against each other, in which case all is good, or they can act as one and fix prices. In the latter case, big company Z decides to spend 10s of millions to discover it themselves and beat XY's pricing, in which case the story repeats.

The use of exact numbers makes it seem like this example is attempting to fool you somehow, but the only essential part is another company having the capability to rediscover the method. They won't even have to try, Y can just offer to buy it, with the implication that they will go all out trying to rediscover it unless X agrees to sell.

Thus no human effort is actually wasted discovering the same thing multiple times. Now things might not work out this way all the time, but in a free market, it will most of the time, and that's enough. Remember, the alternative we're trying to prevent is one company being able to charge whatever price they want for a potentially must-have discovery, for decades.

Libertarianism is not an all-or-nothing philosophy. Different libertarians advocate for different levels of government intervention. An emergency situation, eg., a major war, disaster, irreplaceable resource exhaustion, etc. will almost certainly require a lot of government action. This FAQ aims to show that barring such extremely rare situations that can be handled then using exceptional measures, libertarianism works, and therefore they are no reason to forego libertarianism altogether.

To show this, we go through situations where it seems like the free market would be unfair, and explain why they won't be an issue.

Price fixing would require every single company selling something to cooperate. And if they do, another person sick of them can start a new company and undercut them. Price fixing would also destroy any goodwill towards these companies and many customers wouldn't patronize them even if they lowered their prices again.

A customer that can afford it may willingly overpay for a product due to brand affinity/prestige. Even otherwise, there are 8 billion people on the planet. Getting $10 profit from 100 million people means a billion dollars in profit. None of the 100 million people need to have been poor or exploited; small profits per person can result in a billionaire simply due to the large human population. This is not to say that all current billionaires obtained all their wealth through such innocent means – many have used violence or state assistance – just that it is possible.

There are several ways to make a profit, life would be pretty boring otherwise. Examples include:

But none of these factors are so powerful that a company in a free market can extract exorbitant profits from a customer unwillingly paying with no better choice. Note that intellectual property would not exist in a libertarian system. Of course, people sometimes buy products/services without doing their due diligence or simply not caring enough about ease of quitting, ease of repair, control, etc., and later face difficulties, but that is simply the consequence of their own decisions.

When a company begins selling a product, the price starts off higher to recoup the cost of development, advertising, equipment, land, etc. Some costs don't increase proportionately to the number of units sold, so the cost of making each unit goes down as more are made. Thus a new company entering the market will have to charge higher prices. Does this mean that the existing companies will be able to get away with charging high prices forever because the barrier to entry is even higher?

Let's say that a company needs to charge a total of $100M more than their final prices to recoup initial costs. But by using investor funds to pay said costs, the new company can collect this $100M over, say 10 or more years, instead of 2 or 5, making the additional cost of each unit from the final price very small. Thus they can beat the overcharging company. Big investors are surprisingly ready buy billions worth of stock of companies that have been losing billions every year, if they believe it's a necessary sacrifice that will more than make up for it in the future.

If someone buys up a lot of the food and medicine and tries to resell it at a high price, people will have to buy it, since unlike for non-essentials, they can't just wait for the market to make more, they need it immediately. But this can be solved easily by the community signing an agreement with the supplier before production.

Libertarianism simply refers to the notion of a minimal state. However, the term, especially in the US, generally refers to right-libertarianism, which also advocates for strong private property rights and a free market, and is also the meaning with which this FAQ uses it.

An important concept to libertarians is the non-agression principle (NAP), which forbids the non-consensual breach of contract (i.e., fraud), or of property (which includes the body). Aggression is, however, permitted to the extent necessary to defend against the above.

Right-libertarianism has several variants based on how minimal the state is:

This FAQ aims to defend a minarchist model. All uses of 'libertarian(ism)' henceforth will refer to the same.