Libertarianism Is Bankrupt

by Thomas R. Wells

Libertarianism does not make sense. It cannot keep its promises. It has nothing to offer. It is an intellectual failure like Marxism or Flat-Earthism – something that might once reasonably have seemed worth pursuing but whose persistence in public let alone academic conversation has become an embarrassment. The only mildly interesting thing about libertarianism anymore is why anyone still takes it seriously.

When evaluating a normative ethical theory we should consider three dimensions: 

  1. Is the theory plausible in its own right? I.e. does it make sense or is it an incoherent mess of contradictions?
  2. Would the world be better if it was ordered according to the theory? I.e. does the theory promise us anything worth having?
  3. Does the theory provide a useful guide to action around here right now? I.e. is it any help at all for addressing the kind of problems that actually appear in our practical moral and political life?

1. Does Libertarianism Make Sense?

Libertarianism is a response to the problem of politics – the sphere of activity concerned with the collective management of our social living arrangements that is complicated, contingent, and refuses to obey the authority of reason. The problem of politics has offended many philosophers from Plato onwards. Libertarians’ particular solution to the problem is what I call eliminative moralism: the reduction of the entire noisome political sphere to its supposed basis in a narrow interpersonal morality of consent. The result has an extraordinary intellectual simplicity and normative minimalism which many find appealing and convenient, yet the very sources of its appeal are its deepest flaws.

Libertarians argue that they can replace what politics does for us by recognising our right to do as we please with ourselves and our other property so long as we don’t infringe upon the same right of others or promises we have made to them. With this moral right secured, we can live a flourishing life in a flourishing society powered by consensual exchange between free and sovereign individuals. Moreover, this right of self-ownership offers a stringent test for the moral legitimacy of any politics: There can be no obligation without consent. No one can make us do anything, or take anything from us, unless we agree to it – and that includes anyone calling themself ‘the government’ who says some people in a building somewhere wrote a law so we have to do what it says.

The problem is that wishing away the need for politics doesn’t make it so. Eliminative moralism says that no one can be required to contribute to any collective project without their consent. However, it is obvious that many people who agree that collective projects like a public school system, a police force, or protecting drinking water sources from pollution are worth many times their cost will nevertheless prefer that other people should be the ones to pay for them. Since everyone else will feel the same way, everyone will free-ride and the projects won’t happen. Despite the intellectual contortions of generations of libertarians trying to make out that collective projects can run on private interpersonal contracts or charitable subscriptions, it turns out that a social order based merely on consent would not be a flourishing one.

Worse still, it turns out that a society based on nothing but consent is itself a political project that depends on coercion! For it is easy to say that everyone has the right of self-ownership and to convince yourself that this is true, and that it is the only truth that matters. But what will you do if someone else disagrees, or disagrees with your interpretation of it in this case? Your society is going to need institutions for judging and enforcing the moral truth on people – whether they like it or not. There is coercion back again. Your society will have to pay people to run these institutions. But that is a collective project and we already saw what happens to them. Either those institutions will be funded voluntarily, in which case they will collapse under the curse of free-riding. Or they will be funded by some non-voluntary taxation, in which case there is coercion once again.

The very moral minimalism that makes libertarianism so attractive also leaves it with no resources to answer such challenges. Everything is black and white, right or wrong. It turns out that – by its own lights – libertarianism is also wrong.

2. Would a Libertarian Society be a Utopia?

Libertarians assume that a society based only on consent would necessarily be a good place to live because everything that everyone does would be voluntary, or follow from an agreement that they had previously voluntarily committed to. Since everything we do would be by our own choice, this society maximises respect for freedom. Since everything we do is by our choice, it must make us better off by our own lights (or we would not have agreed to it).

But actually such a society would be ruled by consent and this would be a dystopian nightmare. It would be a society in which all the bad things about the legalistic conception of consent would be amplified and set free of any overarching (political) constraint.

First, the libertarian idea of consent assumes a purely formal equality between parties, and this wishes away the problem of power. In theory, each party can pick and choose with whom they reach agreements and on what terms, for example from whom to buy a computer and for how much. In the real world, power saturates every agreement. Only a tiny number of employees are in a position to negotiate over their terms of employment. The rest of us sign the contract we are given. No one negotiates for credit card agreements, iTunes user agreements, website privacy policies, and so on. They are not even written in a way that we could understand them. But these contracts written by one party to maximise their advantage are nevertheless binding on us.

Are legal contracts at least also binding on those who wrote them? It turns out that this is another theoretical fiction. In the real world the most powerful party not only gets to write the contract but also has the privilege of interpreting and enforcing it in the first instance. If your employer disagrees with you about the hours that you worked or which of you should cover the costs of safety equipment they can directly impose their decision on your pay check. If you disagree with them, you are allowed to find an expensive lawyer and struggle for months to get a hearing from an impartial judge, and probably get fired in the meantime for your troubles. These days you may find that the contract you had to sign requires all disputes to be brought to a private arbitration company with its own contract with your employer. Thus, the libertarian dystopia creeps a little closer. One important role of the political sphere is to set the background rules that protect us from the inevitable exploitation of asymmetrical contracting, but that requires just the kind of broad substantive idea of rights that is lost when you narrow everything down to individualistic self-ownership.

Second, while it may – ideally – be an exercise of sovereign freedom to engage in binding agreements with others, such agreements are nonetheless encumbrances on our living, ruling out all sorts of choices we would rather make. In a libertarian world we must expect to be bound by even more agreements since a libertarian world would be agreements all the way down. Ironically one of the great emotional appeals of libertarianism is dismay at the proliferation of rules in the modern world (rules required for our complex cooperative projects, like fire safety). Libertarians proudly declare that we should only accept rules we have actually agreed to. Yet if you try to match the functioning achieved by those government rules with ones generated through consent, one typically ends up with more rules not fewer, and often ones that are less sensible or accountable. This is the case for the US Homeowner Associations often cited by libertarians as the closest thing yet to societies ruled by consent, and yet which hardly seem like paradises of liberty.

3.Does Libertarianism Have Any Practical Guidance to Offer?

Unfortunately libertarianism is an ideal theory, meaning that it is a theory of how the world ought to be arranged, but not a theory of how things as they are now could be made better – nor even how they could be made more libertarian.

Recall that libertarianism is supposed to be built up out of nothing but the property right we have over ourselves and what is ours. This stuff is ours and no one gets to decide what we do with it except us. This is the principle that rules out politics as we know it by disallowing taxation for collective projects that are supposed to improve our societies. But what is ours in the first place? If libertarians have no good answer to that then their theory cannot even offer a moral objection to policies – like redistributive taxation – that would seem most directly contradictory to their theory of justice. It really would be a pointless theory.

In Robert Nozick’s influential entitlement theory people have the right to what they have acquired legitimately and also to what they have legitimately acquired from others who also got it legitimately. Does this mean that you can say that you own the house you bought with the money you earned at your job and that has your name on the title deed? As it turns out, no. For whether anyone’s possession of something is legitimate depends on whether the entire historical chain of possession that got you to this point also meets the conditions. Considering the amount of skulduggery in history – committed by both private actors and governments – this is unlikely and anyway could not be proven. So if the governing party proposes a new wealth tax on people like you with nice houses to support those economically suffering from Covid, you could not, as an honest libertarian, object that such an action is simply not allowed. On the contrary, it is allowed if politics decides so, and if you don’t like that you had better start making your own political arguments about it.

4. Why is Libertarianism Nonetheless so Popular? 

Libertarianism is one of various anti-politics available to those jaded by liberal democracy. Together with the likes of populism and theocracy it promises to excise the toxic business of politics and replace it with moral purity. As with the others, it tends to attract support from people who want a way to win political arguments without having to have them. The specific focus of self-identified political libertarians is on minimal government, meaning one that is less keen on bossing people around so much or imposing the moral majority’s prejudices on everyone else (and also, particularly attractive to some, less keen on redistributive projects that might dent their wealth). Given the weakness of libertarianism as a means of actually defending individuals’ freedom, however, its supporters would do better to back the classically liberal approach of using moral principles to constrain but not annihilate government. Libertarianism is also often conflated with free-market capitalism and its pleasing efficiency and apparent freedom from the political domain, even though capitalism would collapse if people tried to run the system on contracts alone.

Are academic political philosophers responsible for the persistence of this ridiculous theory? I admit I teach it to my own students – both because bad theories can be excellent resources for thinking about the attributes of a good theory, and because it can be relied on to drive a lively discussion. But the actual student libertarians I have come across all seem to have picked it up from the internet before they got to my class. I suspect the problem is not the handful of philosophers who still take libertarianism seriously, but that the theory’s extraordinary ratio of simplicity to radicalness makes it a perfect viral vector. It has so few working parts that it requires almost nothing of its supporters, yet in return it offers an exciting, even revolutionary world view in which you get to live in a fantasy world where all the difficulties of having to share a society with others are wished away and they all have to shut up and leave you alone.