Why Anarchy In America CAN Work, and Why Government Always Fails

For many decades, there has been a raging philosophical battle in the libertarian community between anarcho-capitalists and small-government minarchists. Since we are seemingly eons away from a libertarian society, both ideas are largely theoretical, yet the question still remains; which will better protect our rights- limited government, or no government?

I believe much of the discord comes from a fundamental misunderstanding of what anarcho-capitalism is, so let’s define the term to clear up the confusion. Chase Rachels writes that, “‘anarcho-capitalism’ indicates that the anarchic society specified is that of a free market capitalist variety. Under anarcho-capitalism, all scarce goods (to include land and other means of production) are subject to private ownership.”


Anarcho-capitalism does not mean “no laws”. Rather, anarcho-capitalists believe in the privatization of all goods and services. Anarcho-capitalists believe that courts should be privatized, and the service of law should be subject to market competition.

My friend Grant at Liberty Viral attempted to answer the question posed above, and contends that a limited government will better protect our rights, and that anarchy in America would never work. However many of the arguments posed against anarcho-capitalism are fallacious, and stem from a a general misconception of both the philosophy, and the way in which the state operates. In this piece, I will be offering an anarcho-capitalist rebuttal to Grant’s arguments.

Grant begins his piece by stating:

“I will first address why government is necessary. We need government for the sole purpose of protecting our life, liberty, and property from threats foreign and domestic. We don’t need to be extorted into paying taxes. We don’t need to have our privacy invaded, either. We simply need our rights to be protected.”

He says here that government is necessary because of the threats that exist to our liberty, but does not define government. As it is traditionally understood, a government is a monopoly on force that has the exclusive power to author law, and provide the service of defense and justice. He says we don’t need to be extorted into paying taxes, yet this is a defining characteristic of government as we know it.

It is oxymoronic and contradictory to then believe that only thieves can protect us from thieves (though if Grant is arguing that it should be funded voluntarily, then he is in essence arguing for anarcho-capitalism). It is theoretical at best to presume that anarcho-capitalism in America would never work, but we know through both a priori and a posteriori information that government does not, and will not ever work. If you are being stolen from, then you are not being protected from thieves. And an entity which obtains its wealth through coercion rather than through voluntary commerce will have no incentive to innovate its product or provide you with a quality service.

It can be argued that smaller, decentralized governments will work better than larger, centralized governments, but this is actually a better argument for anarcho-capitalism than limited government. If it is more efficient for there to be smaller competing states, then why can’t we bring this logic to its rational conclusions? If competition breeds efficiency, then why not decentralize these competing political units even further, until we reach a point where all property is privatized? If smaller, competing states are preferable to one centralized state, then why is having the maximum amount of competition not preferable to these states as well?

As owners of property, we have the incentive to protect what is ours. Because of this, there is a demand for protection agencies and third party arbitrators. If we have the incentive to protect our property, why then can these services not be funded voluntarily? If the market can provide us with food and water (the two most important things for sustaining human life), then why can it not provide us with roads, schools, courts, police, and defense?

He continues:

“Now, why anarchy would fail. The absence of government here in America would lead to the rise of a new government, rather it be foreign or formed domestically. The most likely of the two options would be a foreign government taking control. Russia, China, or even Mexico if they wanted, could claim the land I write this on today. There are existing treaties to protect the United States from being attacked or invaded, however that would not apply in an anarchist land since the United States would no longer exist. The land, resources, and people would be up for grabs.”

I’m never really sure why the “but warlords would take over” argument is a go-to for minarchists, considering it is the US government which has been terrorizing the world, conquering foreign nations, and forcing their will on the world for the last century. If having a government is supposed to prevent warlords from taking over, then it didn’t do too good of a job of keeping William McKinley, FDR, George W. Bush, or Barack Obama out of power.

To the contrary, having a government makes us less safe, and it is the decentralized states which often have the fortitude to withstand military superpowers. The reason the British lost the Revolutionary War was because they were not fighting one United States of America. They were fighting 13 independent colonies, and had to conquer each political unit to assume victory.

When there is a federal government, all that Russia or China needs to do if they want control of the US is to invade Washington DC. However if there were 50 competing states in the continental US rather than one centralized government, a foreign government would have to conquer all 50 states to take control. Now imagine we are living in an anarcho-capitalist society where all land is privately owned. A foreign threat would have to conquer every single territorial unit and hold it under its boot. It is much easier to do this when there is already a tax system in place than it would be to rebuild that tax system from the ground up and force all land owners to participate.


“I believe that people are inherently good, and that power is naturally evil. A vacuum of this magnitude would quickly be filled. The people will demand for it, and foreign and domestic power seekers will fill this vacuum, likely in the name of socialism. Totalitarianism would be a high risk factor as well.”

If men are good, then they do not need a government. And if men are evil, then you do not want to give evil men a government. A power vacuum can only be filled if there is a spot of power to be filled. Giving foreign threats a government to be able to take over is giving them that vacuum. Privatizing everything takes this tool away from them, and requires them to conquer every single territorial unit, as opposed to just the unit which already controls everyone else.

“The reality remains that anarchy would not last, and that it would be replaced with a government absent of the Constitution. We must fight to ensure maximum freedom in the United States while reducing the role of the federal government to simply protecting life, liberty, and property.”

Anarcho-capitalism is no guarantee that your property will not be stolen from you, but government is a promise that it will be. If you seek the protection of property, then private property rights can assuredly never last under a government. Anarcho-capitalism however, provides us with the best opportunity to protect our property.

All men are self-interested and seek to maximize their utility, and there are two methods of accomplishing this. The first is through peace, and the second is through violence. If it is my goal to accumulate capital, I can achieve this much more seamlessly through cooperation and trade, as opposed to violence. By trading with my neighbors, I can gain both their capital, and their trust for all future interactions I may have with them or their confidants. But on the contrary, if I choose to acquire capital through violent means, I will lose the trust of my neighbors and become an outcast. If I then have to fight my neighbors for their property, I will run the risk of being killed or injured. The benefits of violence do not outweigh the costs, but the benefits of peace vastly outweigh its costs.

Since peace is mutually beneficial and cheaper than the cost of violence, men will have a greater incentive to participate in the market than they will to participate in crime. Peaceful transactions are the cornerstone of anarcho-capitalism, and violent crime will be minimized in an anarcho-capitalist society, since it will be much easier to accumulate capital through peace than it presently is today.

“I am not defending the government of today’s America – I cannot. The IRS practices theft, the actions of American foreign policy kills innocents, and the police state is getting out of control. I am advocating for a libertarian government, a constitutional government, and a government that protects your right to live your life the way you see fit as long as you don’t harm anybody else.”

This goes to show that it is a limited government which cannot last. The United States started as a Constitutional Republic and wound up as a global empire. No such private criminal could ever even dream of achieving what the US government has accomplished.

“I don’t disagree with most anarchist principles, I just don’t see how no government could work. It would put our freedoms at risk. I’d have more faith in a libertarian minarchist government than a pure anarchist society.”

I just don’t see how government could work. It puts all of our freedoms at risk, and necessarily violates our liberties. But I digress.