How I know statelessness works [Part 2]

Risk management in practice

Dec 01, 2024

Let's face it: the only role of government is risk management and mitigation. That’s all government is. This is the only reason why statists relinquish their liberties in exchange for a sense of security, or more accurately, risk management.

The state does not offer security

First off, let’s agree that the state does not protect you against crime or war. If anything, the state creates an environment where war is incentivized. How? Those making top-down decisions stand to profit from war with other people’s money and other people’s lives. They have everything to gain and nothing to lose in war, win or lose. On the other hand, no free stateless society would ever have the incentive to go to war, let alone develop nuclear weapons. Sure, some mad scientist could make a nuclear bomb in a stateless world, but this applies even more to a society under government; more so because the technology is already there, as well as plenty of psychopaths with itchy fingers on red buttons.

The state does not protect you against crime. Its brutalizing class (police) don’t stand guard on the streets; you have to resort to private security for that. Sure, the existence of police does serve as a deterrent, but so would the stateless free market, if the state hadn’t limited our self-defense capabilities, and if we had voluntary systems of self-governance instead; systems that would make it practically impossible to hurt others without being ostracized by society. And seeing as though much (if not most) of crime is drug-related, we can safely assert that government directly and deliberately causes crime through its senseless needless prohibitions. If the prohibition era taught us one thing, it’s that prohibiting does not make the prohibited disappear; it spikes its demand due to the “forbidden fruit” effect. Prohibition also significantly lowers the quality of the prohibited good to hazardous levels, due to the state’s barriers to free-market self-regulation,. Prohibition also significantly increases drug prices, due to the risk involved, and the lack of consumer access. This enriches drug gangs and cartels, and here we are today. The only reason drug cartels exist is government intervention in what would otherwise be a free pharmaceutical market.

Also, don’t forget how the state ships, accommodates, and funds welfare abusers from all over the world (at the expense of law-abiding citizens), then gives those welfare abusers a slap on the wrist for crimes committed by them, all on the alter of pathological self-righteous “tolerance.”

Therefore, we logically conclude that the state does not aim to protect you. All it does is poorly offer the illusion of an expensive low-quality risk management service after you’ve already been harmed by it. For example, after you are robbed, raped, or murdered, the state might bother to find the culprit. If it does, it can punish him, but it won’t offer you or your family any compensation for failing to protect you. The state will just torment him in the hell of prison, which will make him a more effective and psychotic criminal when he gets out. This form of punishment serves neither the victim nor society, and it focuses on brutalizing criminals instead of rehabilitating them, and incentivizing them to make amends. For more on this, read my essay on punishing criminals in the absence of a state.

Everything is risk management

Even today under a state, we still feel the need to pay good money to acquire private insurance. If that doesn’t show how useless and unnecessary government is, then consider how the institution of insurance emerged historically.

In the era of colonization, monarchies failed to apply their rule to the sea. A sailor who had died mid-voyage would have had no way of sending his purse to his family, unless he trusted a shipmate. This reality was a disincentive for sailors. Why toil for years and years away from your family only to die without them getting anything for your trouble?

Enter the bookies. Sailors placed bets against themselves, betting that they’d die on their next voyage. If they did die, then they would win the bet, and the bookie would have to pay their families their winnings. If they didn’t die, then they would just lose the bet. But new value emerged out of this transitions: the sense of security, otherwise knowns as risk management. And this worked, because bookies had every incentive to honour their bets, otherwise they’d quickly go out of business. All this occurred outside of any state rule, no government enforcement of contracts. The only forces dictating transactions were personal incentive, and free-market competition. If contracts were not honoured, then these transactions would not have been feasible.

This is what modern insurance companies are: glorified bookies. Car insurance is you placing a bet against yourself: you bet that, during the insured timeframe, you’ll have a car accident. If you do, then your bookie (insurance) loses, and has to pay up. If you don’t, you lose your bet (insurance premium). But a new product emerges, even if you lose your bed: you get peace of mind.

Insurance companies like Lloyd's, and even agricultural forward contracts since ancient Greece, emerged organically in a free competitive market without any government intervention or enforcement. Their role was to manage risk. The free market spontaneously succeeded in mitigating risk much better than any corrupt central planners of the state could ever hope to match. How we know this? Because if the state had managed to mitigate risk, then no one in their right mind would pay extra for private risk management.

In the context of risk mitigation emerging spontaneously in free competitive markets, we can safely conclude that there is absolutely no need for government, for anything. Everything that the inefficient monopoly of government so miserably fails to provide can be self-regulated by a free society, more efficiently, effectively, and morally.

Consider that, without agricultural forward contracts, there would be no agricultural abundance. No government could ever accomplish this, because its central planners have no market feedback. Free-trade transactions emerge spontaneously through supply-and-demand forces. Put the state in charge of agriculture, and you get mass famines, like every single time a communist regime takes over (USSR, China, North Korea, should I go on?).

Now imagine privately ensuring everything, from your bodily integrity and possessions to your land and national defense. This is how private regulations, and laws without government emerge… and they already exist to a large degree, even though the state tries to monopolize every aspect of regulating, from economy to morality.

The misunderstanding of government

There is a common misconception about the role of government. The state is not there to protect you, to guard you 24/7, or to reimburse you when you inevitably fall victim to its poor risk management. The state even admits that it has no obligation to protect you.

The state is not about protecting you. The state is simply a risk-mitigation mechanism to provide some sense of safety, but not direct security.

Regardless, you still submit to the state because you erroneously presume that it is the “best system we’ve got,” and that there are somehow no alternatives to risk management.

People don’t like risk. They want to reduce it. So, they naively fall for the government because they don’t know better. As the immature children we are, we rush to look to imaginary daddy figures to protect us, instead of looking at what we can do.

It’s not that government is “the only system we’ve got” or a “necessary evil” (assuming that evil is necessary no less). It’s that people don’t know any better, just like they used to use leeches to treat an ailment. Leeches weren’t “the best system they had” - it was their knee-jerk reaction, the only thing they thought they knew. Now it’s time to get rid of the leech of government.

Government: the greatest evil

Assuming that government is a necessary evil - without ever trying to figure out a way to make it unnecessary - makes you evil. Why? Because you rest complacent and content in evil.

Assuming that government is “the best system we’ve got,” without giving statelessness every benefit of the doubt with an open mind, makes you lazy and immoral. Why? Because you willingly choose to close your mind to possibilities of more efficient, effective, and moral solutions to public organization.

If you admit that government is a necessary evil, then you should not rest until you find ways to make it unnecessary.

Useful reading:

Thank you for reading. I appreciate your time.

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