In this month's lead essay, Patri Friedman charges libertarian activists with falling victim to bias: Specifically, they seem to suffer from the belief that advocacy and education are enough to change public policy. Friedman suggests otherwise, and he recommends that much more effort be put into demonstration projects that will show how a libertarian world might work. Not only will these projects do more than mere persuasion toward winning the war of ideas, but they will also allow individual libertarians to live in a much freer society, and they will exert competitive pressure on existing governments to reform themselves. Friedman discusses several such projects, including his own, the Seasteading Institute.

ntroduction

I deeply yearn to live in an actual free society, not just to imagine a theoretical future utopia or achieve small incremental gains in freedom. For many years, I enthusiastically advocated for liberty under the vague assumption that advocacy would help our cause. However, I recently began trying to create free societies as my full-time job, and this has given me a dramatic perspective shift from my days of armchair philosophizing.[1] My new perspective is that the advocacy approach which many libertarian individuals, groups, and think tanks follow (including me sometimes, sadly) is an utter waste of time.

Argument has refined our principles, and academic research has enlarged our understanding, but they have gotten us no closer to an actual libertarian state. Our debating springs not from calculated strategy, but from an intuitive “folk activism”: an instinct to seek political change through personal interaction, born in our hunter-gatherer days when all politics was personal. In the modern world, however, bad policies are the result of human action, not human design. To change them we must understand how they emerge from human interaction, and then alter the web of incentives that drives behavior.

Attempts to directly influence people or ideas without changing incentives, such as the U.S. Libertarian Party, the Ron Paul campaign, and academic research, are thus useless for achieving real-world liberty.

In this essay, I will describe our misguided instinct, present some principles for the incentive-level approach, and then describe some of the paths to reform it suggests. My hope is to persuade those brave souls who labor for liberty so diligently to work more wisely as well.

Also, I want to clearly avow that while I criticize folk activism, it often still drives my actions. It is a deep bias, and hard to correct — I strive to overcome it, and I see it in the world because I see it in myself.

What Is Folk Activism?

Our brains have many specific adaptations tuned for the hunter-gatherer environment in which we evolved, which in some ways differs wildly from the modern world. Consider the prevalence of obesity: we eat according to outdated instincts, feasting before a famine that never comes, rather than adapting to our new world of caloric abundance.

Similarly, many people have an intuitive “folk economics” which includes a number of biases such as the anti-foreign and make-work biases. These beliefs are demonstrably wrong, ubiquitous, stubbornly resistant to argument and can be tied to to aspects of the pre-agricultural economy, strongly suggesting they are an evolved adaptation. While economically literate libertarians delightedly skewer those who argue mistakenly from folk economics, we constantly engage in what I shall call folk activism.

In early human tribes, there were few enough people in each social structure such that anyone could change policy. If you didn’t like how the buffalo meat got divvied up, you could propose an alternative, build a coalition around it, and actually make it happen. Success required the agreement of tens of allies — yet those same instincts now drive our actions when success requires the agreement of tens of millions. When we read in the evening paper that we’re footing the bill for another bailout, we react by complaining to our friends, suggesting alternatives, and trying to build coalitions for reform. This primal behavior is as good a guide for how to effectively reform modern political systems as our instinctive taste for sugar and fat is for how to eat nutritiously.

Folk activism broadly corrupts political movements. It leads activists to do too much talking, debating, and proselytizing, and not enough real-world action. We build coalitions of voters to attempt to influence or replace tribal political and intellectual leaders rather than changing system-wide incentives.

This is not a cause for despair. Quite the opposite: it is cause for great hope. It suggests that the failure of libertarian activists to produce libertarian countries may stem more from misdirected efforts than from the impossibility of the task. Using analysis instead of instincts, perhaps we can find a better lever, fulcrum, and place to stand from which to attempt our Archimedean effort.

Principles For Realistic Activism

The world is complex and there are many principles that can be used to guide reform, so here I will discuss only the most vital.

Power Has Inertia

As a libertarian, I find it easy to see the empirical evidence that incentives matter. More difficult, but very important, is to look at the vast gap between libertarian principles and the size and scope of current governments as empirical evidence that power matters too. Politicians are demonstrably, consistently, and ubiquitously expert at entrenching the power of the political class. To most libertarians this is morally illegitimate, but morality has sadly little influence over the realities of power.

If we are ever going to move beyond philosophizing on barstool and blogs to change the power structures of the world, we must accept that power equilibria have considerable inertia. We cannot shift them with hope and outrage alone — we need carefully calculated action.

Democracy Is Not The Answer

Democracy is the current industry standard political system, but unfortunately it is ill-suited for a libertarian state. It has substantial systemic flaws, which are well-covered elsewhere,[2] and it poses major problems specifically for libertarians:

1) Most people are not by nature libertarians. David Nolan reports that surveys show at most 16% of people have libertarian beliefs. Nolan, the man who founded the Libertarian Party back in 1971, now calls for libertarians to give up on the strategy of electing candidates! Even Ron Paul, who was enormously popular by libertarian standards and ran during a time of enormous backlash against the establishment, never had the slightest chance of winning the nomination. His “strong” showing got him 1.6% of the delegates to the Republican Party’s national convention. There are simply not enough of us to win elections unless we somehow concentrate our efforts.

2) Democracy is rigged against libertarians. Candidates bid for electoral victory partly by selling future political favors to raise funds and votes for their campaigns. Libertarians (and other honest candidates) who will not abuse their office can’t sell favors, thus have fewer resources to campaign with, and so have a huge intrinsic disadvantage in an election.

Libertarians are a minority, and we underperform in elections, so winning electoral victories is a hopeless endeavor.

Emergent Behavior

Consider these three levels of political abstraction:

1. Policies: Specific sets of laws.
2. Institutions: An entire country and its legal and political systems.
3. Ecosystem: All nations and the environment in which they compete and evolve.

Folk activism treats policies and institutions as the result of specific human intent. But policies are in large part an emergent behavior of institutions, and institutions are an emergent behavior of the global political ecosystem.

Institutions, Not Policies

I believe that libertarians (including myself) waste enormous effort exploring solutions which will never be implemented or even influence policy. These are not necessarily libertarian solutions — often they attempt to achieve the goals of the majority in an effective way. We’re following the intuitive, folk-activism approach of proposing plans to our tribe. Unfortunately, the problem is not that our legislators lack for good ideas, but that democracy is a flawed method for choosing among them, because politicians respond to incentives too. So while we could argue for weeks about the most effective way to stimulate the economy, effectiveness is not the primary criterion by which lawmakers evaluate policies.

Libertarians pour much of our resources into dissecting policy and proposing alternatives. But agitating for a specific policy is like complaining about a price — and forgetting that it’s set by supply and demand. While policy analysis is certainly an interesting field, as a method for improving political performance it is about as useful as price-fixing is for improving economic performance. And while not without benefit,[3] policy debates feel far more important than they actually are. Our cognitive bias is to assume that we have a voice equivalent to an individual in a Dunbarian hunter-gatherer tribe, and so we comment on nationwide events with a passion to match — even when no one is listening. (Now you understand blogs and bar conversations!) These debates function as a mirage which distracts us from the more fundamental structural reforms that would actually achieve liberty in our lifetimes.[4]

Ecosystem, Not Institutions

Government is just another industry, where countries offer services to citizens, but it has some unfortunate features. It is a geographically segmented monopoly, and since all land is taken, the industry has an enormous barrier to entry. To start a new government you have to beat an old one, which means winning a war, an election, or a revolution. And it has very high customer lock-in: there are barriers to emigration and immigration, and switching countries involves both high financial and emotional costs. These characteristics result in a horribly uncompetitive industry, so it is no surprise that existing firms tend to exploit customers instead of innovating to attract them.

This analysis neatly avoids moral debates and has clear practical implications: if the problem is an uncompetitive market, the solution is to make it more competitive. It also exposes the futility of strategies that don’t address this issue, like trying to win the war of ideas. While appealing and noble, this is ineffective. Without competitive pressure, our institutions generate flawed policies which benefit the political class, not those that reflect the consensus of academic economists. We need more competition in government, not more academic papers or mindshare.

An Experimental Ecosystem

Before I was introduced to the field of law and economics, I assumed that the main problem in achieving a good society was coming up with shared morals and values. Then you just write them down as laws, and you are done. It turns out that even if we agree on a definition of rights, there is no straightforward way to derive laws and enforcement mechanisms. Implementation is not a trivial detail, it’s the hard part! To make things worse, designing policies is the easy case. When we view them as the emergent behavior of institutions, things go from difficult to impossible (so they’ll take us a little longer).

Because we have no a priori knowledge of the best form of government, the search for good societies requires experimentation as well as theory — trying many new institutions to see how they work in practice. This requires institutions to be embedded within a system which allows for their easy creation, testing, and comparison. A governing industry with a lower barrier to entry and easier switching of providers would allow for this constant small-scale experimentation.

This system would offer a host of benefits:

• It creates specific, real-world examples to point to when debating the merits of various systems. How many millions of words of academic papers about the benefits of free-markets does it take to add up to the two words “Hong Kong”?
• Prospective customers of the new system could actually experience it physically and emotionally, rather than as a mental abstraction, which is far more powerful for changing minds. For citizens of the USSR, a single visit to the West could outweigh years of Soviet propaganda.
• It enables proponents of an alternative system (like libertarianism) to live their dream much sooner, because they only need to get a small group together to experiment with their new society, rather than convince an entire existing nation (which may never happen).
• It supports an ongoing, evolutionary process where societies learn over time, and change with the world.
• It doesn’t assume there is one best society for everyone. People can attempt to live their ideals without having to impose them on others. Not only does it embrace multiple variants of libertarianism, but other goals and methods for creating a good society.

The Role Of The Frontier

As Bryan Caplan says,[5] when working within existing institutions, structural change and policy change are the same, because you can only change structure by implementing a policy. Only by starting with a blank slate can you make a better structure without having to overcome entrenched interests, which tend to resist innovation because it reduces their power. Historically, the frontier has functioned as this canvas for experimentation.

There are positive aspects to this need for a frontier, because there is a subset of people (currently quite frustrated) for whom the urge to pioneer is a primal drive. For all that I rail against bad instincts, it is far easier to work with instincts than against them, so it’s good to have one on our side!

Also, the first steps toward settling a frontier are to come up with a new idea, spread it, and build a coalition of people ready to live it — the same procedure and instinct as folk activism. The difference is the strategy of actually implementing the vision with the number of people one can reasonably enroll, rather than one which requires millions to agree before it can be put into practice. The problem is not instincts, it is following them without re-evaluating whether they are appropriate for the modern world.

Technology Is Much More Important Than Rhetoric

Consider the relative effects of Zero Population Growth rhetoric vs. birth control technology at changing the population growth curve of the world. It’s monumental. Technology alters incentives, which is a far more effective way to achieve widespread change than to attempt to fight human biases or change minds. Unfortunately, technology is also much newer in human history than persuasion, and so is a much less intuitive strategy.

Alternatives To Folk Activism

Free State Project

The FSP aims to bring 20,000 liberty activists to the state of New Hampshire. So far, 9,000 have signed up and 700 have moved. Even these few have been able to elect 4 of 400 state representatives, which makes it plausible that the full 20,000 could have a substantial impact on state politics.

I have doubts about the amount of freedom the FSP will be able to secure, because most restrictions and taxation are at the federal level, and the issue of states’ rights was pretty solidly settled in 1865. Instead of opening a new frontier, it is on land claimed and controlled by the most powerful military force in the world. It also operates within traditional democracy and its flaws.

Still, the FSP was consciously designed as a reaction to the failure of libertarian reform to date, and is a vast improvement over folk activism. It concentrates our strength rather than depending on a mass libertarian movement which will never come. It is based on immediate action: practicing our principles today to demonstrate that freedom works, rather than just endlessly preaching.

Being inside the United States may limit the freedom achievable, but it also limits the difficulties, so this is a good low-risk, low-reward option.

Crypto-Anarchy

Proposed in Tim May’s Crypto Anarchist Manifesto way back in 1988, the idea is that anonymous digital cash could greatly limit government power. While computer and networking technology has developed enormously since it was written, digital cash has not taken off, and the main impact of digital transactions seems to have been on record industry sales, not on “the ability to tax and control economic interactions” as May predicted.

Despite the mathematical elegance of digital crypto, our analog world is the site for most spending and income, which can thus be taxed and regulated. Also, physical reality provides a nexus for control — no matter how sophisticated the avatar, a knife between its master’s shoulderblades will seriously cramp its style.

While the Internet has been a big step towards a more virtual lifestyle, we aren’t all going to be jacked in full-time anytime soon. Over time more of May’s predictions will come true, but only slowly and for a limited subset of human affairs. Still, cyberspace is an inherently more competitive, more anonymous, harder to tax and regulate environment, and so advancing it is a way to accelerate freedom through technology.

Market Anarchism

As described in books like Machinery of Freedom, this is a system where competing private agencies define, judge, and enforce the law. It is a strange and beautiful idea which is impossible to do justice in a short space, in part because it is so much a system of human action, not human design. Its brilliant logic neatly solves the problem of how to create an institution that will generate efficient policies. And it is an ecosystem, not just an institution: it generates many legal systems through competition, innovation, and imitation.

Unfortunately, there is no clear incremental path to such a society. Proponents offer the vague hope that governments will somehow fade away, but as observed earlier, power is demonstrably good at perpetuating itself. Anarchism is worth revisiting only if we can get a political tabula rasa some other way. For example…

Seasteading

Seasteading is my proposal to open the oceans as a new frontier,[6] where we can build new city-states to experiment with new institutions. This dramatically lowers the barrier to entry for forming a new government, because expensive though ocean platforms are, they are still cheap compared to winning a war, an election, or a revolution. A lower barrier to entry means more small-scale experimentation. Also, the unique nature of the fluid ocean surface means that cities can be built in a modular fashion where entire buildings can be detached and floated away. This unprecedented physical mobility will give us the ability to leave a country without leaving our home, increasing competition between governments.

This plan is one of immediate action, not hope or debate. It makes use of the people we have now rather than trying to convert the masses, and avoids entrenched interests by moving to the frontier. Most importantly, it increases jurisdictional competition. It will not just create one new country, but rather an entire ecosystem of countries competing and innovating to attract citizens. Like any market, the process of trial and error will generate solutions we can’t even imagine — but that we know will be better for customers.

Seasteading is far from certain to succeed, but this is a hard problem, and there will be no easy answer. Two of the greatest risks are the expense and danger of the marine environment, and the chance that states will interfere. The latter is a systemic risk for any reform (if they’ll interfere with a new city in the ocean, then no place is safe[7]), but the former is an idiosyncratic risk that could be diversified away if seasteading was part of a portfolio of freedom projects.

I founded The Seasteading Institute to advance this path, so if you’re interested in learning more, check out our website, FAQ, and book.

Conclusions

If a fraction of the passion, thought, and capital that are wasted in libertarian folk activism were instead directed into more realistic paths, we would have a far better chance at achieving liberty in our lifetime. We must override our instinct to proselytize, and instead consciously analyze routes to reform. Whether or not you agree with my analysis of specific strategies, my time will not have been wasted if I can get more libertarians to stop bashing their heads against the incentives of democracy, to stop complaining about how people are blind to the abuse of power while themselves being blind to the stability of power, and to think about how we can make systemic changes, outside entrenched power structures, that could realistically lead to a freer world.

—

Patri Friedman is executive director of the Seasteading Institute.

Notes

[1] Essentially this was a movement from a far view to a near view, see Robin Hanson’s discussion of the difference in A Tale Of Two Tradeoffs and Abstract/Distant Future Bias. The difference is also covered in Daniel Gilbert’s Stumbling On Happiness.

[2] Mancur Olson’s The Rise and Decline of Nations is one source. The most recent work on this I know of is Bryan Caplan’s The Myth of the Rational Voter, although it covers only one area of democratic failure.

[3] Policy analysis is not without benefit. It helps people realize how flawed existing policies are, which is the foundation for seeing that institutions are flawed. Understanding the flaws in institutions helps us understand the market which breeds them. The process helps our economic understanding, and the tradeoffs which any society must make. Policy analysis is an important base for our understanding, but we have plenty of base — now we need some boom.

[4] This is the motto of the Free State Project, and a wonderful rallying cry.

[5] Policy All The Way Down, Except Seasteading.

[6] Also note that space has even more mobility than the ocean, and far more resources, plus it diversifies humanity off rock #3, which is extremely important. Thus the oceans are merely the penultimate frontier.

[7] Some people argue that strong defense against existing states is another answer, such as WMDs. This solution has some issues: 1) Pioneering can be done incrementally, while big trouble happens to those who almost have nukes. 2) Self-defense doesn’t address any of the systemic problems that hamper current governments. 3) Being able to successfully defend against the strongest existing nations is a huge barrier to entry. For these reasons, the experimentalist world we are looking for will be unlikely if states commonly interfere with small experimental societies.

Further Reading

I recently started a blog called Let A Thousand Nations Bloom with Jonathan Wilde and Mike Gibson to cover this topic of improving the market for government. We welcome guest posts.

I have found little work that directly addresses this area, and would welcome other references, here are some that I know of:

• Ken Binmore: Game Theory And The Social Contract Volume I, Volume II.
• Bruce Benson: The Enterprise Of Law: Justice Without The State.
• Patri Friedman: Seasteading: How To Homestead The High Seas
• David Friedman: Machinery of Freedom. (Disclaimer: David is my dad.)
• Hans-Hermann Hoppe: Democracy, The God That Failed
• Albert Hirschman: Exit, Voice, and Loyalty: Responses to Decline in Firms, Organizations, and State
• Arnold Kling: Competitive Government vs. Democratic Government (PDF)
• Mencius Moldbug’s blog Unqualified Reservations, for example Against Political Freedom or the summary Condensed Moldbuggery (Mencius engages in constant hyperbole, so have your salt-shaker handy)
• Mancur Olson: The Rise and Decline of Nations, start with Phillip Greenspun’s long review.

Acknowledgements

Thanks to Chris Rasch, Chuck Grimmett, Daniel Holt, James Hogan, Mike Gibson, Michael Hartl, Michael Keenan, Liz Lacy, Justine Lam, and Wayne Gramlich for their comments on earlier drafts of this essay.

Note: This essay is also available in Danish.

Beyond Folk Activism | Cato Unbound.