Market for Liberty

Morris & Linda Tannehill


As Ronald Reagan said in his 2nd Inaugural Address,  “The government is not the solution to the problem; the government is the problem.” This book, published in 1970, has gained millions of supporters; it makes a startling argument and supports it with compelling logic:  the “services” provided by government could be provided more effectively and at less net cost by private enterprise.  Government, as we know it, is “broke”.  It’s well past time to revisit our assumptions and try some new solutions.  Market for Liberty provides a fascinating blueprint.  


All of history reveals the battle of men for control of others, rulers and the ruled.  All of life is a struggle against domination by others.  Most governments evolve as the result of brute force; a few conquer the many; if when “the many” overthrow the few, a new elite few soon dominate and crush “the many”, as demonstrated so massively by Communism after the Russian Revolution circa 1917.  In democracy, which was created at the point of a gun, the people elect their rulers.  As Plato noted, “In democracy fools rule.” As Bermuda’s ex-Premier, Sir John Swan astutely rejoined, “Yes, but that’s reality.”  The governments, in today’s democracies, have become cumbersome, inefficient, ridiculously costly, and, in many cases, very unjust, and not infrequently murderous.  Democracy may be “the best alternative” among governments, as Churchill said, but the greater question posed here is, “Is any government really necessary?”  Before you scoff that thought into oblivion, consider this book:    Market for Liberty (ML), a tiny book of just over 100 pages; it was written in 1970 and has been reprinted many times.  John Locke and Adam Smith might well have embraced it.  It is a classic among devotees of capitalism, Ayn Rand, advocates of hard money, Libertarians, and free thinkers from all walks of society, because it presents a very plausible case for this startling view:

  A society without a formal “government” could provide the advantages offered by the world’s governments today and could do so at much less cost, while conveying much more freedom for all concerned, by simply allowing The Marketplace to provide the “services” that government has taken upon itself: such as, police, fire, schools, roads, mail, etc.  Competitive providers would provide better services and at less, net cost.  

The idea, at first blush, seems outrageous, but is it?  Before you dismiss it out of hand, you owe yourself this amazing book.  For the lack of a better term, I call this “Pure Capitalism”, which means capitalism that embraces not only commerce but the functions of today’s governments.  Governments can’t operate efficiently, never have and never will.  The waste is mind boggling.  Most government services could probably be supplied by the private sector for a small fraction of the cost now paid in taxes – and provide a better service to boot.

To oversimplify the well-conceived and carefully reasoned conclusions, any service of government (police, fire, courts, schools, roads, etc.) could be provided at less cost and with more justice by a private enterprise system.  For example, if police protection were provided by competing, private services (security firms), the best firms, over time, would win the most clients and would provide those services at less cost, and more effectively, than do government-controlled police.  The same could be true of fire, courts, schools, etc.  Roads could be operated on a toll basis, as are Interstates today, after extensive bidding by private construction firms.

A wise political philosopher, the late Harry Browne, once said,

“Only one law is really needed: the law against trespass.”

When you think about that for a moment, it makes abundant sense.  Every crime constitutes some form of trespass.  The laws from legislatures are so numerous as to be unknown to many, obscure in many ways, and often contradictory.  The tax laws offer the best example.  Of course, under a system of Pure Capitalism, there would be no taxes.  Everyone would pay his way.  Loafers would be forced to work at whatever job they could do or they wouldn’t eat.  Those incapable of working would be charity cases, and charity, of course, would become a major component of such a society, as it is in today’s government-based world.

There are obviously many issues with the proposed solutions: e.g., insurance won’t cover all losses; all debts can’t be repaid in money and some debts far exceed the means of the debtor to ever repay; government assets would be given to whoever “seized them and made them his own for all to see”.  Nonetheless, many of the solutions hold great promise (private coining of money, police and fire protection, schools, even roads).  However, they couldn’t be invoked overnight.  Yet, at the very minimum, there may be a middle ground.  Why not allow the private sector to compete in all areas of society: the coining of money (the most crooked method of taxation today rests upon the government’s monopoly over the minting of money), for police and fire protection, for schools, to build roads, etc.  The government, however, would have to issue “credits” to those paid for their own service, credits against taxes otherwise owed.

In sum, it is clear that today’s government systems leave a great deal to be desired.  Better solutions surely lie ahead.  Mankind’s resourcefulness is limited in democracy, where the big decisions are often made by the lowest common denominator of the intellects.  Still, over time, the lowest common denominator improves, and better decisions will lie ahead.  The Market for Liberty provides a worthy introduction to an alternative form of government.