Democracy – The God That Failed

May 7, 2012

Democracy - The God That FailedThis 292 page book is basically an endorsement of Anarcho Capitalism, supporting private property as the basis for all civilization, without the need for any government of any kind.  Instead, freedom, civility and economy would prosper under a system of competing private insurance companies contracting with private property owners, who maintain their natural rights to do what they will with their own property as long as their actions don’t infringe on those same rights of their neighbors.

Hoppe provides an interesting perspective on democracy and how it compares it to other forms of government – especially that of a monarchy. After World War I, the powerful monarchies were no more and gave way to democratic forms of government. The economic comparison is drawn from the fact that under a monarchy, a king has sole ownership of all property in his domain and therefore has some motivation to maintain the property value of the kingdom. But under a democracy, there are only temporary stewards in control – they don’t own the property, they only have a temporary power to control it and therefore are motivated to extract what wealth they can for themselves and their cronies while they are in power.

There will always be less people who have things worth having than there are people who don’t have those things. And under a democracy, it is easy for someone to come to power by promising to give to those who don’t have those things.  But this is always a wealth transfer from ‘haves’ to ‘have-nots.’

Hoppe favors a decentralized form of society, where private property owners are free to do as they please as long as what they do doesn’t infringe on the rights of their neighbors. In such a society, free trade is key to economic success.  Contracts can be made with other property owners, both foreign and domestic.  Hoppe also introduces what he’s defined as restricted immigration as part of the ideal foreign policy.  Here, in order for a person to move into the geographic region, he/she must be invited by an existing property owner.  This contrasts with the current democratic foreign policy where the government forces existing property owners to be integrated, many times against their will.

Under a democracy, citizens depend on a central government to provide ‘protection’ and pay via taxes for such a service. However, the citizens have no say in how much the service costs and also have no recourse if such service fails.  This is a compulsory scheme and the government has a monopoly on the service.  Instead, under the system Hoppe suggests, private property owners would have the choice of contracting with competing insurance agencies to provide such protection.

In the last few chapters, Hoppe provides some insight on how to go about changing the existing system – via secession. He points out that it probably isn’t possible to try to secede as the south did in 1861 during America’s Civil War.  Instead, disbursed cities throughout the country should form their own bands, which would be much more difficult for the central government to prevent.

Personal note: Although Hoppe points out some very insightful truths, his suggested resolution based on complete private property ownership still doesn’t address the main problem with any society – human nature.  What is to stop insurance companies from merging, using coercion, becoming huge, and finally dominating the world as the US government does today?


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