Wednesday, May 16, 2007

Fatal Instability

Sorry for being gone for so long. I haven't had a terrible lot to write about. Fortunately I've got a pretty good one here, addressing an objection almost 10 years old at least, but still nagging some people.

A commenter here sent me to paulbirch.net where he (Paul Birch, not the commenter) has page about anarchocapitalism being unstable because of restitution ratios in market justice. Well, I'm going to try to refute this as best I can. If you want to see the original, it's located here:

http://www.paulbirch.net/AnarchoCapitalism1.html

First, it should be noted that Birch loves the common law. He loves talking about it and referring to it. But the common law isn't exactly the perfect libertarian law code. My understanding is that it allows for theft and enslavement without the owner's consent, merely on the basis of the owner's inaction. Now, something similar to common law but without the provisions for theft and enslavement would probably be a good thing for libertarianism. But alas, we don't have that, and discussions of common law today are not discussions of a libertarian ideal of law. This is relevant because a purely stateless justice system would probably not work exactly the same way common law courts do. In this case, I think the false assumption is that the finding of any court is automatically made binding upon the offender, who may not even be aware that a case has been tried. We anarchists like to call two people agreeing to deprive a third of life, liberty and property, "conspiracy", even if one claims to be a victim and one claims to be a court.

The second point I take issue with is how he says that the offender must pay for all the enforcement, restitution, and court costs. I do believe the offender should ultimately be paying for their offenses, but I do not believe it must necessarily be done directly as the statement implies. If done indirectly, the restitution war can be easily averted. Another issue on this same point is his insistence that the court must provide immediate restitution to the victim, to pursue repayment from the accused afterward. First problem with this is that I can find no basis for immediate restitution as opposed to restitution later, with interest. The second, and slightly more pressing problem, is that of economic calculation. Justice is a good or service which is subject to scarcity. The same problem of a government "Cost-plus" contract appears here, the court has no reason to keep it's costs low because someone that is neither the producer nor consumer is going to be paying the bill. Also, there would be little way of telling when more people are in the judicial industry than is efficient. If there are too few, or too many, the prices paid by the consumer (the victim) cannot go up and down to reflect the shortage or surplus and motivate more or less people to go into law. On the same token, the customer has no reason not to go with the most expensive courts (in terms of resources used, not in terms of money, for the latter won't be realized by the customer), or to use the time and money tied up in the courts to enforce relatively petty contracts, for example using $60 worth of resources to enforce a $10 debt, when it would make more sense to either get it done out of court, or lump it with a number of similar unpaid debts and do them all at once. Indeed, with the full cost paid by the accused, the customer has motivation to waste the resources, and pass the costs on to the accused, as revenge.

My third issue starts when he discusses "Justice in an Ultraminimal State", where the State consists of a court which has a monopoly, a court of final appeal, but with most courts being private. Then in the section "Justice in an Anarcho-Capitalist Society" he says "There is no final court of appeal...no uniform code of justice can be enforced." Implying of course, that things like restitution ratios (how much the offender pays the victim as restitution, for example with a restitution ratio of 2, an offender which steals $100 will be expected to repay $200 to the victim) can be altered at will. He is right in that there is no court of final appeal, but he takes this as if to mean there is no appeal but perhaps to another part of the same court as handled the case for the victim.

Predicting an anarcho-capitalist society is difficult because, as Birch rightly notes nearer the end, there's way too many factors to consider to be able to see them all at once. But what I believe would happen was outlined in my earlier post "Supplanting the State: Courts and Law". In the system I predict will appear, there would up to three courts, one court chosen by the victim (and in most cases, the accused would probably submit to it), one by the accused (for when the accused suspects a corrupt court), and possibly a third court to settle any dispute between the first two. The court chosen by the accused would be the defacto court of appeal, able to find the first court to either have authorized illegitemate siezure of property, or to have found incorrectly if action has not yet been taken. Potential items of dispute between the courts would include guilt and restitution owed.

My fourth problem is a point of negligence on his part. Under the section "Justice an an Anarcho-Capitalist Society" he says, "...there is no guarantee that an anarcho-capitalist society will be just." And he is right. However, he failed to point out the same in the immediately prior "Justice in an Ultraminimal State". There is no guarantee that an ultraminimal state will be just anymore than the same can be said of anarchocapitalism. I say it's a point of negligence because I'm going to be nice and not assume he's taking the justice of an ultraminimal state as a truth which needs no proving, because that wouldn't be negligent, that would be stupid. So I'm calling him negligent. But you know, this really isn't basis to refute his idea. It just shows that the alternative won't be better. I thought the point needed to be made.

Now onto the restitution war. Birch predicts that courts will offer, for example, 150% restitution, at the offender's expense. Victims will flock to the 150% court and not use the 100% (restitutional "unity") courts. In his words: "And why not? After all, it's the criminals who pay. Who cares about them?"

This is where the non-commonlaw, indirect, market-version appeal process comes in. A man expected to pay 150% restitution could take suit against the court that demanded such payment for unjustified theft (assuming the property siezure has taken place, if not, then this would be an appeal) by going to a different court. The victim's court would then likely be found (especially if they have been advertising it to attract customers) to have been unjust in demanding payment, and the offender's court will demand the excess 50% be returned (or, pending the siezure, dropped). It may have to go to a third court, and the third court will in all likelihood not be attracting customers (the other two courts) with 150% restitution ratio, as both courts would need to agree on it.

I think this sufficiently demonstrates why a restitution war will not happen. To make it short, courts that do that, will get sued. Ironic, sorta. I'm inclined to believe that this didn't occur to Mr. Birch because he was still operating within the statist court-of-final-appeal mentality. As he says in the Ultraminimal State section, "The state court will enforce its judgements against all other courts; but no other court can enforce its judgements against the state court." This may have accidentally carried over to his analysis of anarcho-capitalist justice. This statist idea that the courts are not people themselves, able to bring suit and to be sued, but some entity above the people at large, metaphorically similar to a god passing judgement, is easy for even anarchists, and especially statists, to fall into when discussing anarcho-capitalism. It's so easy to do because we never see courts suing each other under statism. Private courts are contractually obligating upon both parties from the outset, and hierarchal state courts merely overturn decisions without punishing bad judgement, and certainly nothing like suing the court, so it's easily missed that it is possible.

However, I'm going to keep going through this, because even if we assume that he has been correct up to this point, which I do not believe he has, he makes more mistakes.

The most notable one for me is what he says and what he does not say right before predictions of the collapse of civilized society into chaotic violence and gang rule. What he says is, that the courts which do not raise the restitution ratio go out of business and whoever has the highest restitution ratio will become the monopoly court or virtually so. I really have no idea what reason led him to that conclusion, since it seems to me that raising the restitution ratio would be a simple matter of policy adjustment. But the point is moot because courts can be sued. Anyways, the notable mistake is where he says that the last court will go "belly up", and then there's no courts. I personally don't get it. If there's a surge in demand for courts, then the price will go up and new courts will pop up like weeds. High demand + Low Supply = High Price = High Incentive for new courts to appear. The predicted crime wave never happens because there will never be no courts on the free market.

Billy-mae and Billy-bob waking up Grandpa Boo for his wisdom in a dispute over who gets to sit in front of the 1937 Ford Pickup on cinderblocks in the backyard right next to the outhouse is as much a court hearing as the professional organizations with suits, lots of wood furniture, and juryboxen. There won't be licensing of courts. There won't be the same situation as if every licensed doctor died tomorrow. Because there would always be the black market, and under anarchy, the black market is just "the market".

My favorite part of the page is the sixth section, "Conclusions", in which he basically gave an ornate version of "I don't really know what's going on here (paragraph 1), but I know I'm right (paragraph 2), but I hope I'm wrong (paragraph 3)." His conclusions speak for themselves, folks.

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