What is Anarcho-Capitalism? (Bryan Caplan Pt. 1)

we're continuing our partnership with learn liberty this week and joining me today is a professor of economics at George Mason University an author an anarcho-capitalist and a pacifist Brian Kaplan welcome to the Reuben report thanks a lot for having me a lot of good buzzwords in there and we're going to get to all of them but first what's it like being a professor on a campus these days that doesn't identify as a progressive is that tough are you getting rocks thrown at you every day how's that going my life is perfectly fine nothing's ever had nothing bad has ever happened to me I don't even know I've ever gotten a negative comment on a student evaluation to be fair I'm in the economics department at George Mason University which is a very unusual place there's a lot of libertarian and free market oriented people there but also you what I say is that the stories you hear on the video while generally true if you remember how many people are on campus how many professors there are so if every week you see some horrible thing happens to one professor that still leaves you 99.999% of all professors who had a perfectly fine week and so far so good for me yeah and you make a point of saying you're in the Economics Department yeah probably insulated from some of this ago because you have to work with facts and figures and numbers these are sort of outside of the realm of where social justice can hit right right and also just in economics there's a long history of a field where you can say really controversial and shocking things and people are curious and want to talk about it in a civilized way rather than get really mad at you so really only those I'd say at least half of the controversial ideas in academia have come out of economics and the economists get Nobel prizes for these ideas it's you know Gary Becker Ramone Friedman it's not like people are waiting around for you to say the wrong thing and jump on you so I mean I do to me is any of the real differences there's just people who are very dull there are economists are very boring but it's not like they're angry at people for doing other stuff they're just not doing really exciting work but there's plenty of room in economics for people to say almost anything really and not only get away with it this is to succeed you know I mean I've long been telling people like if you really want to be a professor try to figure out how to repackage what you're what you want to do with economics and then get a PV at your PC economics you late more money you'll get tenure you'll get any Oh get a job easily and you'll be in a very supportive atmosphere where you can save you want yeah I can tell you truly believe in the free market because you're welcoming people to take your job right now that's that's pretty good ideal tenure so I'm not that worried that way but um and also remember that the more people in order in order to become a racer you first have to become one of my customers and go to grad school so Metro is not as Unseld finding my team yeah do you find that professors of economics either George Mason or I you were just mentioning a debate you're doing in a couple days but generally professors of economics from whatever you know whatever pathology they believe in are able to debate and it doesn't get personal and it can really stick on the issues and that kind of thing so I generally say yes again the main problem is just people who are not interested in bigger ideas and only want to focus on their research topics people like that are not touchy they're not hostile they're just apathetic or they sometimes love the idea of you know what you are doing is not science sometimes I don't really care about that and you don't belong here but it's not that they disagree that you're saying as they disagree with people taking on bigger questions of any kind you know that and you know that's sort of what I've dealt with in million in my time in academia is just I want to do big exciting ideas and a lot of economists frown on that not because they disagree with the content but because they disagree with anything big and exciting yeah so before we get into some of your big and exciting ideas do you find that generally outside of the universities that just the American populace really doesn't understand anything about economics because this is what I see all the time you know I I can only garner so much information from social media but I see people saying things about trade all the time and immigration all the time and all these things that are tied back into economics and I'm like you don't really seem to know much about anything yeah so I whole book on this called the myth of the rational voter biography shoots bad policies in the book I just go over all the evidence on what does the public actually believe about economics compared to what anyone who can explain the textbook Thanks and yeah it's terrible yeah you need a cell you know what you think about it is so mean right now here in LA I grew up here so I will say that until I was 17 I never heard any arguments against the minimum wage I never heard any argument against regulation Pharmaceuticals I don't think I ever heard any argument against the welfare state ever again I was not growing up in Berkeley or some with some left-wing Haven just growing up in a normal boring middle-class suburb here Los Angeles but the kinds of arguments that economists make and are aware of are just not even on people's radar yeah so that's an important to feature you said there that you didn't grow up in Berkeley you grew up in a suburb of Los Angeles but somewhat blue-collar it was yeah it was really a middle middle middle class middle class yeah it was it was it was probably you know can easily been half Republican in those days yeah and still like I never heard any of the very basic economic arguments critiquing standard popular regulations you know even so it's like mm only like you talk to my parents about rent control and yet they didn't understand anything about the economists critique rent control how it causes it how it causes a shortage housing for them is like well we own rental property so we're against it sort of all that be all they can come up with right so you know so anything anything but this this is your very very standard for them not just the American public but the global but the global public and throughout history is just like the very basic ideas of economics that are in every textbook are you not known and when they're heard this is this reckoning so it's one thing to never heard them but northern oral reaction is just anger yeah so table-like because they're so insulated from any other idea basically right and also it's just like it just like why are you saying this boy I can't we have the minimum wage it's a program to go and help poor people and then an economist comes along and says there's a downside this could cause unemployment and people's reaction is how could you say something like that so terrible yeah the only what Kyle you like you hate you hate poor people and again this seems like a parody but I have experienced this firsthand plenty yeah what do you do what do you do with that when when you try to lay out something and you say well here's data to support it but it's so emotional to somebody else something like minimum wage working usually I try to connect it to percent experience because anytime I talk about talk about the data then someone say once your data I wanna there must be plenty of other people of other data so try to say well look when you fill out a job application you get to the line on salary requirements you put a million dollars an hour no why not well because I think if I put too much money then I'm less likely to get the job AHA so it's not just me that believes that if wages are too high that unemployment result you believe it too yeah it's just that you don't want to connect what you know from your own experience to the world of policy because it doesn't sound good yeah I think it's interesting what you said about your parents they had a rental property so they didn't like rent control because obviously you don't want it if you're the owner of the property and how we all apply our own life might be separate from what ours are philosophical principles are yeah because I lived in New York City for about 12 years in an apartment that was rent stabilized so it was slightly different than right I controlled but they could only increase my rent I think something like you know change every few years but about 2% a year which for me as the tenant it was great and they you know over the course of 12 years my rent land I think started 16:54 a two-bedroom apartment on the Upper West and I think it maxed out at about 2000 so as the tenant on my side that's pretty great make the argument I am wrong about that yes so in terms of your own self-interest you know you might might be perfectly right yeah we they're I mean I would say well there are some downsides things like quality tends to go down with rent control so you like to heat it a heating breaks down and you can never like I'm going to come across things so so there is that so you know this is just you know very standard result with any kind of price controls if you can't adjust on the price then you can adjust on all these other and all these other ways to adjust on quality but you're you going to try charging people for extras things like that yeah I mean so like you know there's always going to be people who do benefit for the policies and if you happen to be that person then it's very elegant like you might suppose harder than I did you know the the saving grace is that in general people are not comfortable arguing for political policy or policies on self-image to the grounds so you know you're say look this is very bad for society people normally want to dispute that that is bad for ID they don't want to say well sure it's bad for society but I'm one of them in the minority people's benefit list so I like it and we should have it yeah you know it's interesting I think the point that you make there about well they're gonna have to cut in other ways if they can't raise your rent so for example am i building in the winter every winter there would literally be if we were in the middle of a storm there would be three or four days ago where we would not have heat an old steam heat yes you know four-story building and there was a couple days when I was single back then that I literally was under the covers and my dog because I didn't want her to play either and I went to the to the management building which is a couple blocks away and I was basically reaming them out and I remember the woman was sitting behind bulletproof glass and I thought this is what's wrong with this system this woman that she working for a big company they owned five hundred buildings were stuck with her I never fully connected that to rent control or any we're not inclined to move out to a full plate price place that had good heat yeah so that does show how we will sort of negotiate these strange thing so let's talk about anarcho-capitalist all right because I haven't done much on it I think I've had one in our Co capital T my friend that guy T on on YouTube who you should check out if you don't know great guy in Atlanta what is anarcho-capitalism so internal capitalism is the idea that the so-called minimal functions of the state are actually more than you really need and it's about it is not only imaginable but you know it could but it really could work to privatize the last lingering functions of government like police courts and the law itself again this is I need the times really crazy so the way that I usually explain it is well right now people may say well government clearly estimate monopoly over police monopoly over courts monopoly over law they say government isn't monopoly over these things right now right now there's actually more private security guards in police so but is that it really that's true so there you know there are more there are more people hired by business and communities to go and do policing than there are police in like in the official sense and then you'll see no circuit courts there is a huge area of private adjudication there's arbitration there's any time you probably their credit card used to the companies involved no you call the credit card company and they have their own internal adjudication system for handling things like this Facebook if you have problems on facebook you go into Facebook no you just you go and you complain with them and they do something about it and then you're not sure they really do something about it in the case of Facebook but very well similarly minimum they give you a bunch of options solve your own problems you can block someone you can unfriend them you can make sure they never contact you again so you know they give you a bunch of remedies that you have which oh you'll Dave worked out exactly what it is they want to do about it and then feel similarly for for looking a law itself there are many private organizations that have their own rules that they apply so again mentioning obviously oh so private arbitration you know one of the main reasons people use private arbitration is that they don't use regular laws they use their own laws which are designed to work better than the government's laws so you can get your issue resolved in a few days instead of weeks or years so you know like usually with pro with private arbitration they have the arbitrator actually be someone who knows what he's doing right so they have someone who is in fact an expert on this area business rather than giving it to a generalist and twelve people who were too dumb to get out of jury duty yeah so just just sort of beginning realizing wow so there's a lot of private more private alternatives that already exists right now you know to you know to government providing these services that at first glance a lot of people just have the reaction of it with Justice Society which is burn in flames if there were private police or private Korell private courts or private law look around it's not burning now there's already a very large role for the private sector yeah so and then what I think you know but I think about entrecôte capitalism I always just say right we'll start what we got you realize that that is not going to lead anything bad and there's very good reasons why people are using these private alternatives right now which is they're better they're worth the money you get you you actually go you get better quality for for of you know not only for a lower price but remember these are private companies competing with free government services and they're still carving out a big architecture themselves because so many people are so dissatisfied with these services they get provided free by the government and then just think about like how much further can we take these so you know you know very easy with private arbitration right now one of the big limits on private arbitration is that even if you sign a so-called binding arbitration clause in fact if the person that is a person doesn't like how the binding arbitration turns out they can go at a commando you or the court yes they can take it works so for example if you sign binding arbitration saying you know in the event of any of any employment to the dispute is going on this will be handled by private arbitration uh you know but that contract in general is male like you know why it might get a forced there's no there's no confidence that would be and again if you think about it well yeah I mean like suppose that you can sign is binding arbitration I could get my brother-in-law to go and be the arbitrator he always rose like favor you could use this to get around the great many government law if you can understand why government doesn't want to do this and yet clearly you could go and allow a lot more room for private arbitration and and actually it is likely there is a mention and then spent up demand for private arbitration that is right now being stifled by regulation right Emanuel and once you start thinking about how could there be even more do so like one like one obvious one to be is if you go to government courts then they say well actually if this is if this is a private contract we do this for quite you just have to have an arbitration clause and it's not our problem and only no like no like you so if you want if you want to do dication put an arbitration clause and all we do there's dispute it shows the contract it says this the arbitrator rubber-stamp that's it yeah so maybe as an intermediate yes you as the intermediate step you would keep criminal stuff in that event exactly exactly some a good enough it's purely nightly basis exactly yes i mean i think then when you just start thinking about all the things that you can hand over to the private so to the private sector it is much larger than what pietà what sort of than what what it occurs first and then the anarcho-capitalist idea is really once we once we have privatized all the things that at first it seemed like you couldn't but we just keep going further and further further on the end you're left with almost nothing and then the question is could you just get rid of that last it yeah so but a but a pause on the last bit per second because you mentioned a few different areas there but I think the arbitration ones really interesting I'm wondering when when you see cases of arbitration now it must self select a certain type of person to go ahead and do that what what type of things are being fought in arbitration you know to me my new partner you have I guess you really have a certain amount of money you would not want to maybe know that the person across the table from you is in a similar situation or a similar views that they'd be willing to accept it as because you just said right at the end they could probably figure out a way to get this back into the court mean it's fairly common actually just to add it in a boilerplate into a contract saying it will be arbitrated but the people who really wanted I think are people been burned by lawsuits from the past people who've seen business deals that's collapsed before their eyes because the dispute came up and they didn't work it out and then it took years for them to go and resolve it and by then the business was bankrupt so the ovo or course if you've been sued by an employee and you think you anything I didn't think it was bogus that right a thing like I ever wants that to happen again so these these are like some obvious cases of putting it in but you know coercing like no employer is thrilled about the idea of getting sued yeah so no Union like if it were the kind of thing you could really rely on then I say I think it's very likely that it would be totally standard to put in private arbitration and just to avoid like all like all the hassles that are involved with hiring people right now yeah again of course if you think these laws are good then this is very distressing to you on the other hand to someone like me the fact that almost everyone would probably happily sign away the right to sue the employer shows there's something very very bad about the system we have like look it's the kind of thing that is like the right to sue your employer is the kind of right the people will sign away for small amount of money right which means that it's probably not a very valuable right to begin with it's the kind of things that you're stuck with and it's written many ways as a burden because then you have to convince an employer I'm not going to sue you I'm so uncool and well in it also that the average person who works for even a small company not just a giant corporation we don't have lawyers on retainer so I work for myself which is a pretty beautiful thing but I've worked at plenty of companies where the day I you got hired I decide some crazy book of all these are sure and of course I didn't read all that stuff it's like I'm not walking around with our lawyer and most of our supplies were just signing I've been doing what they're saying right which I would say is thank goodness for that because if people were actually people radically taking more seriously and you Leary right now I think your firms are taking advantage of that my co2 gun to go and dilute it as much as a llama Wow I think I think though since I think the regulations are bad in the first place I'm all for people diluting the regulations as much as possible yeah I mean I was well you said there's no saying thank God we don't get as much governess we pay for all thank God we don't sue people to anywhere near they said that we legally could right because it would be a hellish world yeah this may sound like a very amateur question but when people go into arbitration are you bringing a lawyer with you or is it just that the arbitrator is just looking at what was sine and decide it like is there a nettle argument that's taking place right so I think it varies a lot so sometimes you might bring a lawyer so you know so we like it may actually depend upon the rules of the arbitration but you know I think you know a lot of the ideas just to cut the expenses down so a lot of times you don't have a lawyer you just have an arbitrator there who generally is well versed in the industry that you're working in so he actually knows what you're talking about and then of course you know part of what they're doing so there's something more moderate called mediation where the arbitrator doesn't have where the person doesn't really get decide anything but just tries to get the two people to talk it's kind of like counseling and then arbitration is stronger where he listens to both sides and he tells you what's going to be there always a set timeframe on how long that lasts nearly well so certainly not always in since this is private there's this nail is like there's a wide range there's a beautiful rainbow of all possibilities you know which are all done so you know there's sometimes there's an arbitrator who just says looking like we need tomorrow that's it's rubber you know the story here's here's what can happen and even part of the beauty of that is once you get the dispute resolved a lot of times you can go back to working with each other yeah we may not be too happy about it but like there's no longer an ongoing dispute and so it's settled and then you can get back to business right and you haven't paid an insane amount to load right all right boy you're en are in thrilled with these oh yeah yes probably not either like so of course there's Simon we're entrepreneurial not to see well this is an opportunity for me to branch out but yeah I think would be very bad for lawyers and really long-running and of course for litigators particularly which is the small minority of lawyers in the first place but yeah you know some you know like if you look for contract lawyer this might be awesome because then people then there'd be a bunch of people who want to rewrite all our contracts to go including by putting binding arbitration that's really an utterly binding right uh so you mentioned earlier that even policing could be pressurized but what would happen so I can understand a place like Beverly Hills people got a lot of money we're going to privatize the Beverly Hills Police Department Beverly Hills Cop okay I saw the movie that was it was about but I had to get that in there somehow but what wasn't a place what about the place were there with the economics are terrible where people have no money we're probably crime is the highest whoo right right who's going to put in money to how you gonna make a profit off that yes so kina you realize those places work where crime is terrible or ones where the current police already don't work very well so we're just were stepping back and realizing the current system is quite crummy to begin with now like you know who would pay for it otherwise so you have the obvious place to start are people actually are our landlords so when you look like in a more suburban area you're talking about homeowners associations are some of the obvious people pay for it but you know even now in that area is very common for landlords to pay for some kind of security and if they know that it's their job to do it I'll being in it will show like a high crime area even someone who is poor is going up values or life values protection so you know sort of like a like an economist joke as being you know you see a lot of really expensive sneakers and batteries down but so why is this well like when it's a priority people will come up with the money in order to pay for things with a really care about but you know the only about policing is I mean I think it's also better to think about it in a broader category of just enforcement of all kinds so like there's many kinds of enforcement besides actual police so one that's become very common with the Internet is the all kinds of reputational incentives so you know like you know just like bad reviews things like this you know these work far better than like the FDA so you like imagine you get a bad meal you go and call it the FDA and complain about it or something like actually like local meat inspectors know like much more likely to go and put in a bad yelp review and this is the way that we are probably getting most of our actual enforcement yeah like you're like how what is protecting you from food poisoning is it the government General government's hardly doing anything about it what's really breaking from food poisoning is lolis word of mouth which is now amplified because it's know it now it is word of the internet why one complaint feeling my dad runs the internet business like if one disgruntled customer is terrible for you and is really a much more effective enforcement mechanism than anything the government is doing about it so as some of it that it's just the the messaging has to be clearer because that content seems very obvious to me in a day of the internet right where you're right people here now more about what a yelp review of a restaurant says then what either a written review in the LA Times says or what you know what it says that the restaurant what they're telling you themselves so we that this is really about messaging in a way more than economics because I think people can get there economically yeah and then again also just thinking about ways that you can get a contract between people that you don't ordinarily think of as as a connection relationship so right now we all say like if you get an action with someone you know a car accident you don't have you don't have a contract with a person you got an accident with but if you both have insurance your insurance company has relationship with their insurance company so we of course most auto accidents never go to trial the insurance companies have a system that they work out where they negotiate with each other they've got standards so again that's that's already going on and then just think about any time you're in a public place any time you're in a mall also you like you right now of course there's dispute there the police will handle it but it is very easy to visualize a world where when you go to the mall there's actually a sign saying like you know so when you enter this you come under the jurisdiction of this arbitration company and any dispute that happened to the mall then is no longer actually needs to be handled by the police so yeah so your hands and then of course people saying well I mean they're just Lana cops you know they don't even have a lot of them don't really have guns of course if the taxpayers will pay for someone to be shot at then few companies are not going to pay are not going to pay the extra mount to have their employees right so the whole system economics yeah sort of flip if we yet we insist yeah so many oh simply I mean the amazing thing about all of the kinds of private up lvo a private law that we see right now isn't that how little it does but how much it does given that the government provides these services free of charge and people still I will take money out of their own pockets to go rat rather than go and get the free stuff which yeah all right so of course you it goes always the assess is not for you have to be is but another sense it is free namely you can use it without any additional charge so that's the sense in which the cemetery I sometimes like you'll get charged for false alarm although that's pretty unusual but I think fire department sometimes you call them for no reason those that they'll give you a bill so like why did you go and we slide the services but normally that's not how it works you

  1. Anarcho-Capitalism sounds great as a Libertarian but sadly it is not feasible. Without regulations on business to prevent monopolies, then an anarcho-capitalist society will eventually turn into a society ruled by a mega corporation that will establish rules in order for the consumer to buy their product or use their money to oppress the people and establish the power.

  2. talks about how there is already more private security than police – Doesnt explain why the hand of the market hasnt reached in to poverty communities that need security.
    Also, it's amazing the power of the government is so transparent it seems like everything would run fine without it…until you're libia and bigger army policy comes up again.

  3. Damn, so many haters of anarcho-capitalism here. xD
    A lot of people here actually dont think any further past all the bad things that COULD happen.

  4. Yeah, anarcho-capitalism is kinda silly. But so are all anarchist ideologies anyways.
    At least ancaps actually have a logically consistent (if idealistic) plan for how a state-less society could work.
    Unlike say, anarcho-communists, who simply fall back on a vague "everyone happy together" cliché.

  5. Oh ! and you forgot about air privatisation, that'd be a huge business. All you have to decide is who it is going to belong to. Also, you'd better invest more in the space industry. The first arriving to another planet will take possession of it. Then all you've got to do is privatise black holes and, why not, the whole Universe. But beware, there might be beings out there with bigger guns who had done it already, then you may get in trouble.

    Change dealer, folks. You're not smoking the right stuff

  6. Economics comes from Greek, and means house management. Well done anarcho-bullshiters for trying to bring human thought back to the 18th century. You really have to be retarded, trying to attach the most perfect form of humanism -anarchism, to the capitalist machine which is leading humans to self-extinction.

    Yankees, when will you accept the fact that you will never be able to re-write Europe´s History, where you come from, and that you don´t have any History yourselves -apart from the massive genocide that created your sad country ?

    At least you got Trump now: the proof that your dream is over. Besides, he's funny !

    "America Farts"

  7. Ahhh the masses. If only they understood how they came to afford such ignorance. Tu ne cede malis,
    sed contra audentior ito.

  8. when someone sneezes and some of the air particles get onto your lawn so you shoot him and enslave his family all without violating the NAP

  9. Sounds like if I had money, I could get unlimited support of any kind, i.e. police, arbitrage, army, health care, education, etc. But If I didn't have money, I would be totally screwed. And insofar as we already in the state of economic inequality, and this would be the starting point (as I understood from this video), this system of rules will only make social issues more pronounced. In other words, in the free market, this system of rules exhibits catalytic properties. There so many other questions. For example as following comes to mind. Are we still going to pay state and federal taxes for the services that are duplicated by the private businesses? How work will be distributed for state and private workers? How conflicts of interests and responsibilities between them are going to be resolved? etc.

    People have been the end goal all along, and they should continue to be that goal. But it seems very much like the proof of the idea itself became the end goal. The desire to prove it replaced the need to help people. I closely watched and listen to the dialog. Prof. Caplan sounds obsessed with his proof, he became pure scientist in that sense. And it alone became his fetish. But there is absolutely no sign of a realization that general application of solutions is a terrible idea. This is as bad as general application of socialistic, capitalistic of fascist ideals, for as long as there are no safeguards against corruption, avarice or lust for power, people will find the way to exploit any system whatever. And, apparently, natural counteracting forces are not strong for that purpose, as history showed. People do all kinds of atrocities in the name of their ideas. Unfortunately, the mob is too lazy, scared or ignorant to prove them wrong. And this fact has been exploited by all "crazy" leaders and mad scientists.

    Be careful with this guy's ideas. Undeniably he is a smart person, but he is in no way a humanitarian. Educate yourself about his earlier work, books and speeches and you will understand what I mean. For him, a good worker is better than a good human. For him, rich inner world of a human worth nothing if it cannot be applied to working skills. These kind of scientists would, even inadvertently (as a matter of fact, for individuals do not interest them), sacrifice every single member of the society in the name of its purity.

  10. I came here to get a deeper understanding of ancap… I got a lot about arbitration and a little about policing. But, most importantly, I was further assured that an ancap model is really scary for poor people… Like really really scary. This interview swayed me further away from the ancap side.

    Can someone provide me with an actual good discussion? I want to find something that would possibly convince me. I seriously want to understand this perspective.

  11. All great till corporate becomes the successor to power and they use it against other people and corporations, which they then use to setup a monopoly to then jack up prices while then suppressing competition, taking on other megacorps and forcing smaller companies to become subisdaries. Eventually, the libertarian methheads dream becomes an authoritarian state were power has been moved from a social ogliarchy to a board of directors who now have imense wealth with no real idea of what to spend the accumalated wealth on.

    Ye kunt ill straf ye with me A-10 the next time ye fekin mongolian sex slaves exhauset their breath on me fekin private property and drop a thumb nuke with me bitcoin cauz ye violated me NAP

  12. Would a private company earn money by printing money, and sell that money to people or other companies in order to allow for circulation of currency?

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