A Condensed Version of: For a New Liberty: The Libertarian Manifesto
by Murray N. Rothbard
Compiled and Edited by Dr. Jimmy T. (Gunny) LaBaume
The Public Sector, III: Police, Law, and the Courts
A common fallacy is that government must supply “police protection.” In actual fact there is no absolute or fixed commodity called “police protection.” There are almost infinite degrees of protection—everything from a policeman who patrols once a night to round-the-clock personal bodyguards. With this in mind, the question of how police should allocate their funds becomes problematic. Is it electronic or fingerprinting equipment? Plain clothes detectives or uniformed police? Patrol cars or foot patrolmen, etc?
Since government has no objective indicator of efficiency, it has no rational way to allocate a limited budget. Consequently, allocations are subject to politics, boondoggling, and bureaucratic inefficiency. By contrast, if services were supplied on the free market, consumers would pay for whatever degree of protection they wanted. Efficiency would be insured by the desire to make a profit, keep costs low and serve the consumers.
Deciding what laws really to enforce is a problem for government police. Theoretically, they are supposed to “enforce all laws” but the limits of their budget force them to allocate. Furthermore, the absolute dictum to “enforce all laws” works against any rational allocation of resources. On the free market each customer individually decides how much of what kind of protection he is willing to pay for.
Free-market police would not only be efficient, they would have an incentive to be courteous and refrain from brutality. On the market there is no disjunction between service and payment that is inherent in all government operations. Free market competitors acquire their revenue through voluntary exchange. Government acquires its revenue, not voluntarily but coercively from taxpayers.
In fact, as government police become more and more inefficient, consumers have been purchasing more and more private forms of protection—neighborhood watches, private security guards, insurance companies, private detectives, and sophisticated security equipment.
It is common knowledge that insurance detectives are far more efficient than the police in recovering stolen property. This is simply because the insurance company is motivated by economics to serve the consumer as well as avoid paying benefits. As a result, its primary concern is recovering the loot with criminal punishment being secondary. Again by contrast, since police represent a mythical “society,” they are more interested in catching and punishing the criminal than they are in recovering stolen property.
It is impossible to describe a market that exists only as an hypothesis. However, it seems reasonable to believe that police protection would be provided by landowners and/or insurance companies with services being paid for in regular monthly premiums. Since they would otherwise be paying benefits to victims, preventing crime would certainly be in an insurance company’s best interest.
Normally a person who wants to be protected would pay premiums in advance instead of waiting to be attacked. Furthermore, common street crime would likely be taken care of by whoever owns the street. But suppose, for example, an unlikely event occurs where someone is being mugged on the street. It is very likely that private police companies would want to cultivate goodwill by making it a policy to provide free aid to victims in such emergency situations.
Competition insures efficiency, low price, and high quality. There is no reason to assume that there is anything sacred about having only one police agency. Some economists hold that the provision of certain goods or services is a “natural monopoly” and that, therefore, more than one private agency could not survive for long. Maybe. However, only a totally free market could decide that for sure. Furthermore, there is no reason to believe that police protection is a “natural monopoly.” Insurance companies are certainly not, so why not Metropolitan, Equitable, and Prudential police protection companies? Furthermore, modern technology makes establishment of branch offices of large urban firms possible even in the most remote rural areas.
But, if police protection was private, how could the poor afford it? In the first place, the same question could be asked about any good or service. But, you say, protection is necessary. Well, so is food, clothing and shelter but hardly anybody advocates government nationalization of these goods. Just as with these essentials, very poor people would be supplied with police protection by private charity—for example by private security firms voluntarily supplying free police protection to the indigent for goodwill (as hospitals and doctors do now) or by special “police aid” societies similar to the “legal aid” societies we have already.
As it is now, police services are paid for by the taxpayer who very often is the poor man himself. In fact, he may very well be paying more in taxes now than he would in fees to more efficient companies. Furthermore, this would be a massive market meaning very large economies of scale. As a result, protection would be much cheaper. In fact, insurance would likely be much cheaper than it is now because the industry is very heavily regulated in order to keep out the low-cost competition.
But, you object, wouldn’t clashes between agencies lead to “anarchy” and perpetual conflicts between the police forces?
Well first, since there would be no State (or central government), we would at least be spared the horror of inter-State wars fought with massive, super-destructive weapons. All of history bears out that the number of people killed in neighborhood (or tribal) disputes is negligible when compared to the mass devastation of inter-State wars. The only clashes that could break out would be local and even then the weaponry would be limited in scope and devastation. Two police agencies could not use mass bombing, nuclear or germ warfare against each other because they themselves would be destroyed in the process.
Furthermore, as it is now, every person is a subject of a monopoly government. As such, he becomes irretrievably identified with “his” government. So, if another government attacks, it will attack the citizenry as well as its government. On the other hand, if Company A does battle with Company B, the most that can happen is that their respective customers (and no one else) may be dragged into the fight. So although this local “anarchy” would not be likely to occur, even if it did, we would still be much better off than we are now.
Why is anarchy not likely? In the first place, every police agency would be aware of the fact that customers want protection that is efficient and quiet. Obviously clashes would devastate their business so it is absurd to think that they would want to deter from their own efficiency and disrupt the quiet by continuously clashing. Such conflicts would simply be bad for business and, if they did occur, they would likely be ironed out in private courts.
To be even more specific, suppose that two neighbors accuse each other of assault or violence. They subscribe to different police companies and each calls his own company. It would be pointless (as well as economically and physically self-destructive) for the two companies to shoot it out. Instead, they would use private courts or arbitrators to decide who is in the wrong. In fact, this would be advertised as a vital part of its service.
To be continued