A Question About Anarcho-Capitalism

[Nolan]

Who would print the money in ancap? In real-life capitalism the central government does, so in ancap would some kind of community institution have to exist, or would businesses have to print their own money?

[Drace]

Ask the Ancaps.
mises.org

[Skooma Addict]

Who would print the money in ancap? In real-life capitalism the central government does, so in ancap would some kind of community institution have to exist, or would businesses have to print their own money?

Private Banks.

http://mars.superlink.net/~neptune/BankFAQ.html

[Dean]

Private Banks.

http://mars.superlink.net/~neptune/BankFAQ.html (http://mars.superlink.net/%7Eneptune/BankFAQ.html)

Which will quickly subsume smaller firms by strategic manipulation of security and financial systems.

Don't forget your fractional reserve banking, which without reserve requirements (remember - no regulation!) will allow for completely unbacked loans.

And what happens then? The term escapes me, but I'm sure its catastrophic... :rolleyes:

[Nolan]

Ask the Ancaps.
mises.org

Yeah I have an account there. My purpose in asking it here is not only to find out but to start a debate.

[Sir Comradical]

Anarcho-capitalists are a marginal group of undesirables with contradictory ideological beliefs. Real Anarchists (collectivist-syndicalist types) hold that the purpose of the state is to protect private property. Desiring capitalism without a state to protect private-property is a contradictory position.

[Cal Engime]

Which will quickly subsume smaller firms by strategic manipulation of security and financial systems.

Don't forget your fractional reserve banking, which without reserve requirements (remember - no regulation!) will allow for completely unbacked loans.

And what happens then? The term escapes me, but I'm sure its catastrophic... :rolleyes:I think the constant threat of bankruptcy would be a sufficient check against zero-reserve banking with or without a lender of last resort.

[Scary Monster]

Anarcho-capitalists are a marginal group of undesirables with contradictory ideological beliefs. Real Anarchists (collectivist-syndicalist types) hold that the purpose of the state is to protect private property. Desiring capitalism without a state to protect private-property is a contradictory position.

This is where private security firms come in, right?

[syndicat]

I get the impression that a lot of modern than Anarchism is very influenced by Council Communism...Is that unfair to say?

yeh, but there will be a tendency to become overleveraged. this is exactly what happened as the result of the more recent deregulations. an overleveraged bank is an accident waiting to happen.

[Nolan]

This is where private security firms come in, right?

Yes. A sufficient explanation as to how they're not a coercive institution akin to a state and even perhaps worse in real life continues to elude me.

[Cal Engime]

Who would print the money in ancap? In real-life capitalism the central government does, so in ancap would some kind of community institution have to exist, or would businesses have to print their own money?In an ancap society, gold (and/or silver?) would be money, and private goldsmiths would issue gold coins. Paper money issued by a bank would have value because it could be redeemed for gold.

Not because ancaps themselves prefer gold, but because it has historically been chosen by individuals as a medium of exchange (this being because it has certain properties which are important to money: high value to weight ratio, easy to divide, doesn't vary in quality, doesn't decay).

[Sir Comradical]

This is where private security firms come in, right?

One possible answer for the ancaps would involve individuals protecting their property with their own arms, the logical extension of this is a *drum roll* state!

[anticap]

A sufficient explanation as to how they're not a coercive institution akin to a state and even perhaps worse in real life continues to elude me.

You're not the only one:


To my mind a right-wing anarchist is just a minarchist who’d abolish the state to his own satisfaction by calling it something else. ... They don’t denounce what the state does, they just object to who’s doing it. This is why the people most victimized by the state display the least interest in libertarianism. Those on the receiving end of coercion don’t quibble over their coercers’ credentials. If you can’t pay or don’t want to, you don’t much care if your deprivation is called larceny or taxation or restitution or rent.

http://inspiracy.com/black/abolition/libertarian.html


It is no coincidence that "anarcho"-capitalists try to limit the definition of anarchy or anarchism purely to opposition to the state or government. This is because capitalist property produces authoritarian structures (and so social relations) exactly like the state. By focusing on "government" rather than "authority," they hide the basic contradiction within their ideology namely that the "anarcho"-capitalist definition of private property is remarkably close to its definition of the state.

http://anarchism.pageabode.com/anarcho/an-anarchist-critique-of-anarcho-statism


Anarcho-capitalism, in my opinion, is a doctrinal system which, if ever implemented, would lead to forms of tyranny and oppression that have few counterparts in human history. There isn't the slightest possibility that its (in my view, horrendous) ideas would be implemented, because they would quickly destroy any society that made this colossal error. The idea of "free contract" between the potentate and his starving subject is a sick joke, perhaps worth some moments in an academic seminar exploring the consequences of (in my view, absurd) ideas, but nowhere else.

http://chomsky.info/interviews/19961223.htm

So don't worry, you're not dense -- they just haven't got such an explanation.

[Skooma Addict]

Which will quickly subsume smaller firms by strategic manipulation of security and financial systems.

Don't forget your fractional reserve banking, which without reserve requirements (remember - no regulation!) will allow for completely unbacked loans.

And what happens then? The term escapes me, but I'm sure its catastrophic... :rolleyes:

You need to actually explain why this would happen. Also, don't make points that are addressed in the FAQ, unless you specifically have a problem a portion of the FAQ.


Anarcho-capitalists are a marginal group of undesirables with contradictory ideological beliefs. Real Anarchists (collectivist-syndicalist types) hold that the purpose of the state is to protect private property. Desiring capitalism without a state to protect private-property is a contradictory position.

How is it contradictory?

[Tablo]

You need to actually explain why this would happen. Also, don't make points that are addressed in the FAQ, unless you specifically have a problem a portion of the FAQ.



How is it contradictory?
Private property can't be protected without some form of state violence.

[Chambered Word]

Anarcho-capitalism would be a fucking excellent system to be living under, in my opinion. Without any state to protect them, expropriating the capitalists through violence might be alot easier. :thumbup1:

That is, if the formation of a state isn't inevitable. :rolleyes:

[LeftSideDown]

[QUOTE=Dean;1735011]Don't forget your fractional reserve banking, which without reserve requirements (remember - no regulation!) will allow for [I]completely unbacked loans. [/I/QUOTE]

It doesn't have to be regulated to be illegal. Loaning out funds you do not have is fraud and would considered such in an anarcho-capitalist society.

[Sir Comradical]

How is it contradictory?

You need a state to protect private property. Anarcho-capitalists are anti-state but pro private-property.

[Dean]

I think the constant threat of bankruptcy would be a sufficient check against zero-reserve banking with or without a lender of last resort.
Bankruptcy? These firms can print money! How could they go bankrupt?

[Dean]

It doesn't have to be regulated to be illegal. Loaning out funds you do not have is fraud and would considered such in an anarcho-capitalist society.
There's not a free market or a business in the world that thinks this way now - why on earth do you think it would be "phased out" besides your own idealist need to justify your proposed system?

It's much more efficient at providing returns on investment and of course profit. Are you saying these won't be the compelling forces under a free market?

[Dean]

You need to actually explain why this would happen. Also, don't make points that are addressed in the FAQ, unless you specifically have a problem a portion of the FAQ.
This would happen because the last 100 years has shown that every capitalist firm supports fractional reserve banking. They support it because it allows them to lend out more money. It's an incredibly simple concept.

If you're speaking of the other changes, well we have seen - especially at the turn of the 20th century - massive accumulation of capitalist firms. There is no reason not to expect firms to assemble together, beause it provides:
-greater competition with smaller firms
-greatly reduced overhead
-more buying power, and thusly more choices in management of an enterprise
-more buying power, and in a libertarian milieu, more and better private security

[Skooma Addict]

This would happen because the last 100 years has shown that every capitalist firm supports fractional reserve banking. They support it because it allows them to lend out more money. It's an incredibly simple concept.


Yes, FRB outcompeted 100% reserve banking, and wherever the latter became dominant it was thanks to government regulation. However there are natural checks on how much each bank will print. One other advantage of FRB is that it isn't deflationary.


If you're speaking of the other changes, well we have seen - especially at the turn of the 20th century - massive accumulation of capitalist firms. There is no reason not to expect firms to assemble together, beause it provides:
-greater competition with smaller firms
-greatly reduced overhead
-more buying power, and thusly more choices in management of an enterprise
-more buying power, and in a libertarian milieu, more and better private security

There are plenty of reasons not to expect firms to form a cartel. For example, cartels are unstable and with no barriers to entry a cartel cannot prevent new competitors from entering the industry.

[Dean]

Yes, FRB outcompeted 100% reserve banking, and wherever the latter became dominant it was thanks to government regulation. However there are natural checks on how much each bank will print. One other advantage of FRB is that it isn't deflationary.
Vaguely describing natural checks doesn't account for a contradiction. Try again.




There are plenty of reasons not to expect firms to form a cartel. For example, cartels are unstable and with no barriers to entry a cartel cannot prevent new competitors from entering the industry.
Unstable? History has proven that smaller firms are much less stable, since they have smaller and weaker finances which are much more susceptible to market conditions.

Show me examples of small companies which have maintained stability throughout the decades without conglomerating or failing. You won't find examples since being small in financial terms is a severe hindrance.

All you can do is vaguely reference "instability" and "checks" - issues which you can't even put into more distinct terms because you're not referencing any real phenomena, just ideals that you desperately cling to in order to prop up your preconceived notions of market systems.

You simply don't know what you're talking about, which explains why you had no choice but to reinforce my point about fractional reserve banking above.

[Skooma Addict]

Vaguely describing natural checks doesn't account for a contradiction. Try again.

What contradiction? You are unaware of the natural checks regarding inflation put upon private banks issuing their own currency?


Unstable? History has proven that smaller firms are much less stable, since they have smaller and weaker finances which are much more susceptible to market conditions.

Show me examples of small companies which have maintained stability throughout the decades without conglomerating or failing. You won't find examples since being small in financial terms is a severe hindrance.

The cartel as an entiry is inherently unstable. Most of the time, there is at least 1 member which discovers it would be better off breaking away from the cartel. The cartel also cannot stop new competitors from entering the industry.

You don't think I can find examples of small businesses that have lasted for a few decades?

[Dean]

What contradiction? You are unaware of the natural checks regarding inflation put upon private banks issuing their own currency?
If you were more aware of these mystical restrictions, I'd expect you to contradict me in using those examples. But I don't see where they effectively contradict my examples anyways.


The cartel as an entiry is inherently unstable. Most of the time, there is at least 1 member which discovers it would be better off breaking away from the cartel. The cartel also cannot stop new competitors from entering the industry.

You don't think I can find examples of small businesses that have lasted for a few decades?

Cartels weren't the issue - they exist with players of similar market power.

Our conglomerates empower themselves by growing larger, which is a much more compelling method of market control.

10 smaller firms which equal the size of one larger firm are each in much weaker positions, because for every firm there are set positions and divisions which need to exist and be paid for. This is why mergers always create "position redundancy" and significant layoffs follow. In the case of one firm with the equivalent market shares, sales or assets of 10 smaller firms, the larger firm will always have more capital free for:
-reinvestment
-purchase of security assets
-purchase of finance products (i.e. Peasant Death insurance policies, derivatives and the like)
-expansion of market shares

[Skooma Addict]

If you were more aware of these mystical restrictions, I'd expect you to contradict me in using those examples. But I don't see where they effectively contradict my examples anyways.


I don't know what it is that you want me to contradict. Is it this?

"This would happen because the last 100 years has shown that every capitalist firm supports fractional reserve banking. They support it because it allows them to lend out more money. It's an incredibly simple concept."

Well that explanation fails since not every capitalist firm lends out money.

Or is it this?

"Which will quickly subsume smaller firms by strategic manipulation of security and financial systems.

Don't forget your fractional reserve banking, which without reserve requirements (remember - no regulation!) will allow for completely unbacked loans."

The first part is just an assertion and it is too vague for me to understand what you are trying to get at.

As for the second portion, banks only need to have fractional reserve of what they lend. What is the problem?


10 smaller firms which equal the size of one larger firm are each in much weaker positions

Not necessarily.


In the case of one firm with the equivalent market shares, sales or assets of 10 smaller firms, the larger firm will always have more capital free for:
-reinvestment
-purchase of security assets
-purchase of finance products (i.e. Peasant Death insurance policies, derivatives and the like)
-expansion of market shares

Even if that were true, so what? Small businesses have advantages of their own. As long as they are profitable they won't go out of business.

[Dean]

You're dealing in nothing but incredibly weak categorical rejections. Consider the following:

"This would happen because the last 100 years has shown that every capitalist firm supports fractional reserve banking. They support it because it allows them to lend out more money. It's an incredibly simple concept."

Well that explanation fails since not every capitalist firm lends out money.
Laughable! We know that firms both lend and receive loans via fractional reserve banking. But even if that weren't the case - so what? Every firm that lends supports fractional reserve banking.


Even if that were true, so what? Small businesses have advantages of their own. As long as they are profitable they won't go out of business.
What?? Is this all you have - you can't even give me examples of what makes smaller business advantageous? You do realize how increasingly preposterous your position is, right?

[Dr Mindbender]

Who would print the money in ancap? In real-life capitalism the central government does, so in ancap would some kind of community institution have to exist, or would businesses have to print their own money?

this in itself troubles me when you take the free market to its extremes.

Im guessing that in an ancap society, thered even be open competition in the field of money printing. The problem is that without some sort of central regulation (vis-a-via the state) its difficult to set a benchmark of anti fraud measures meaning it would far easier for underground money forgers to print their own notes and devalue the currency.

Have a game of bioshock and see where it goes.

[Skooma Addict]

Laughable! We know that firms both lend and receive loans via fractional reserve banking. But even if that weren't the case - so what? Every firm that lends supports fractional reserve banking.

So? basically every bank also supports the Federal Reserve. Whether or not banks support something has no bearing on whether or not it is a good policy. That must be addressed on its own terms.



What?? Is this all you have - you can't even give me examples of what makes smaller business advantageous? You do realize how increasingly preposterous your position is, right?


No, it is just a hassle to have to explain all of this to you...

One advantage of a small business is that it can usually coordinate its internal activities more efficiently, and while it usually cannot harness economies of scale, some large businesses are adversely effected by diseconomies of scale.

[Cal Engime]

Bankruptcy? These firms can print money! How could they go bankrupt?You can't print gold, so if somebody wants gold for their money and you don't have any, you have a situation. Of course, if you can print banknotes that aren't backed by anything but banknotes and persuade people to accept them, good for you.

[Dean]

So? basically every bank also supports the Federal Reserve. Whether or not banks support something has no bearing on whether or not it is a good policy. That must be addressed on its own terms.
The question isn't if its a "good policy." What matters is that deregulation (obviously) benefits the capitalist class. Deregulation of FRB will have the obvious effect to make it more prevalent - firms which refuse to operate within those parameters would have severe barriers to expansion, particularly of their market shares.

Again, your concern about "good policy" lays your underlying idealism bare - this is not an issue of good policy, but of what we expect capitalists to do in the context of a market free of regulations.

It's pretty clear: follow the policies which create greater profits.


One advantage of a small business is that it can usually coordinate its internal activities more efficiently, and while it usually cannot harness economies of scale, some large businesses are adversely effected by diseconomies of scale.
Thanks for bringing up "diseconomies of scale," because it is your (first!) provision of explanation, though indirect:
http://en.wikipedia.org/wiki/Diseconomies_of_scale#Examples

Notably, it proposes the following solution:

Solutions to the diseconomy of scale for large firms involve changing the company into one or more small firms. This can either happen by default when the company, in bankruptcy (http://en.wikipedia.org/wiki/Bankruptcy), sells off its profitable divisions and shuts down the rest, or can happen proactively, if the management is willing.
However, we have to contend:

A. How often does this happen as opposed to conglomeration under capitalism? I guarantee you the ratio is very small.
B. Is there any indications that barriers to these diseconomic situations will not continue to exist in a "free market"? It is clear that large firms, acting with more capital, can provide for the reorganization of economies to their interests - the real method of government cronyism.

[Skooma Addict]

What matters is that deregulation (obviously) benefits the capitalist class.
Deregulation will help some capitalists and harm others . Who is harmed/helped will depend on the specific policies.


Deregulation of FRB will have the obvious effect to make it more prevalent - firms which refuse to operate within those parameters would have severe barriers to expansion, particularly of their market shares.So? This is like saying that firms which don't operate within the parameter of satisfying consumer demand will have barriers to expansion. Big deal.


A. How often does this happen as opposed to conglomeration under capitalism? I guarantee you the ratio is very small.What?


B. Is there any indications that barriers to these diseconomic situations will not continue to exist in a "free market"? It is clear that large firms, acting with more capital, can provide for the reorganization of economies to their interests - the real method of government cronyism.Diseconomies of scale will continue to exist in a free market. They have always existed.

[Dean]

Deregulation will help some capitalists and harm others . Who is harmed/helped will depend on the specific policies.
Nope. They benefit the capitalist class which has already succeeded. The capitalist class which it does not benefit are those who have not proven themselves capable of producing enough capital to be favored.
It's nothing more than cronyism at the highest level of capital. They can't buy the service of the state, too bad.


So? This is like saying that firms which don't operate within the parameter of satisfying consumer demand will have barriers to expansion. Big deal.
I know you find it hard to effectively follow discussions, but the point is that free markets will engender more FRB. You can ***** and moan about it being a "good policy," but the fact is that it's a capitalist - driven policy which wont go away with a free market.


What?
Do companies more frequently break up or conglomerate?


Diseconomies of scale will continue to exist in a free market. They have always existed.
No doubt, but if you have to capital to affect many different industries (think security) than you can engineer the economy to create barriers for the creation of diseconomies.

Companies don't get capital and say "gee golly what do I do with this"? They buy people off, whomever they can, in order to preserve their profit margin and, eventually, hegemony if they are the one to achieve that status.

Every past business enterprise has taught us this before, and you still cling to some idealist bullshit: if only they were completely free to practice their pursuit of capital. Sorry, kid, all that means is more power to the capitalist class - and a big deal, too, since this could very possibly be the most extreme expression of totalitarianism the world has ever seen.

If the propertied class is completely free to follow their own interests, it will be their interests represented in the subsequent market conditions. Incredibly simple.

[Skooma Addict]

Nope. They benefit the capitalist class which has already succeeded. The capitalist class which it does not benefit are those who have not proven themselves capable of producing enough capital to be favored.
It's nothing more than cronyism at the highest level of capital. They can't buy the service of the state, too bad.

No, it depends on the policies enacted. Tariffs for example will help some capitalists who have already succeeded, hurt some capitalists who have already succeeded, help some incoming capitalists, and harm other incoming capitalists.


I know you find it hard to effectively follow discussions, but the point is that free markets will engender more FRB. You can ***** and moan about it being a "good policy," but the fact is that it's a capitalist - driven policy which wont go away with a free market.

Well good, as a supporter of Free Banking, this is what I would like to happen.


Do companies more frequently break up or conglomerate?

I don't know. Although companies propably wouldn't conglomerate in the first place if they thought it wouldn't be profitable.



No doubt, but if you have to capital to affect many different industries (think security) than you can engineer the economy to create barriers for the creation of diseconomies.


Security is not a natural monopoly, so no you can't.


Companies don't get capital and say "gee golly what do I do with this"? They buy people off, whomever they can, in order to preserve their profit margin and, eventually, hegemony if they are the one to achieve that status.

The people that they buy off are almost always state officials. But anywyas, companies reinvest their capital far more frequently than they use it to buy people off.