There’s privatization, and then there’s privatization
Perhaps one of the toughest but least acknowledged problems in libertarian schools of thought is what I’m going to call “The Just Privatization Dilemna”.
Libertarians, by definition, want to remove as much as possible from the sphere of the State. As a simplification, you could say we go beyond the commonly accepted doctrine of “Separation of Church and State” and advocate either “Separation of Everything and State” or “Separation of Damn Near Everything and State”.
Where the doctrine of Separation of Church and State runs into some problems, though, is when it is merely an isolated policy, rather than integrated into a holistic set of solutions.
Where something is removed from the sphere of the State, but the State remains strong overall, instead of being a liberating experience for everybody, somebody’s liberty gets trashed as that facet of life gets constrained for them. Societal conflict ensues. Problems thus arise not from the Separation of Church and State per se, but from the fact that you’ve still got a hulking behemoth of a State on your hands.
Where there is an ongoing process of implementation of this doctrine through public policy, that process becomes twisted to serve the ends of those who would prefer more State power — because they are the ones doing the implementing. Notable also is that by “they”, I don’t mean, or exempt, any particular political party. Structural incentives are such that “they” will always be the State, regardless of who is in control of the apparatus of State. Politics corrupts everything it touches.
As Rothbard pointed out, any genuinely libertarian position on anything ought to revolve around one question: “Does it decrease the power of the State?”
Hold that thought.
Now, much has been written on the topic of privatization. Libertarians commonly take it as an article of faith that privatization decreases the power of the State. But does it, though?
Well, that depends. General Semantics and any common dictionary clearly show us that words can and do have multiple definitions. Rather than having a knee-jerk reaction of approval, advocacy and defense of anything that the label “privatization” gets slapped on, we need to be more discerning.
Privatization can mean asset privatization — divestiture by the State of some of the assets it holds.
Seemingly straight-forward asset privatization can be problematic if we fail to remember one thing at all times — the State is nothing but banditry. As I have said before — they are just like the Mafia, but with flags. State assets are stolen property. To let the State go further and turn those assets over to particular people at the State’s discretion is, ultimately, just facilitating the fencing of stolen goods.
Privatization also frequently means service privatization — which is where things start to get blatantly tricky. Service privatization can mean the State abandoning parts of what it does to be handled by the Market instead. More frequently, though, service privatization consists of a “public-private partnership” — fascism. Such schemes do not abandon anything to the market. Rather, they expand the power of the State by coopting business interests.
Similarly to what I said about Separation of Church and State above: Where privatization is used as a rationale to decrease the power of the State, liberty waxes. Where privatization is used as a rationale to increase the overall power of the State, liberty wanes.
Note also that a proper definition of “the State” is not limited to solely the literal apparatus of government.
Where there is an ongoing process of piecemeal privatization through public policy, one small initiative at a time — documented, studied, lobbied for, publicized, campaigned on behalf of and RFPs sent out to consultants on — that process becomes twisted to serve the ends of those who would prefer more State power. And, again, that happens because they are the ones doing the implementing.
Kevin Carson and Claire Wolfe have been thinking about these sorts of things as well, by the way.
I still have a great deal of thinking to do about this, but it seems that regardless of how much I struggle, I am still inexorably drawn to the following conclusion:
Since privatization is often, if not always, corrupted in being carried out by the State — the genuinely moral approach would seemingly be for privatization to be carried out by the productive class themselves, rather than the State. In short, that we ought to seek privatization through non-governmental means.
Of service privatization, I can only say at the moment that it seems like a field ripe for revolutionary entrepreneurship. Pleading with and being coopted by the State in efforts to try to get them to withdraw from a sphere of activity has been tried. What seems potentially more fruitful is, within the scope we are allowed by circumstance, to do whatever they pretend to do, but do it better — to shame them into withdrawing from that sphere of activity, if such as they can know shame at all.
What of asset privatization? As it happens, people have previously banded together before to take back what was rightfully theirs from the State — government and the ruling elite enriched by privileges granted by that government. They organized themselves into local groups to work together to carry out this people’s privatization. Things went downhill badly after that point, though. Those local groups were called soviets back then, in 1917.
Like I said — I still have a great deal of thinking to do about this.
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Good post. There is a distinction between types of privatization and deregulation that needs to be made in order to prevent libertarian ideas from being damaged in the realm of public opinion. Just because we favor free markets, which include promoting privatization and deregulation, doesn’t mean that we necessarily support everything labeled as such. Your expanded definition of the state shows how not everything that falls into this category leads to a net gain of liberty.
By the way, the Kevin Carson link actually goes to the Claire Wolfe post.
“Good post.”
Thanks!
“By the way, the Kevin Carson link actually goes to the Claire Wolfe post.”
Whoops! That’s what I get for trying to edit and compose at the same time. Fixed it.
The fly in the ointment
As Brad Spangler points out, there’s privatization, and then there’s privatization. This is one area where “right” libertarians have been running the table on “left” libertarians for decades — and it’s time and past time to ask whether or not t…
[…] Libertarians are often said to be in favor of “privatizing everything.” But privatization through state-conducted initiatives is in reality often just the fencing of stolen goods. The state says to its political class supporters, “hang on to this asset, so it can be nominally privatized” — without the original theft or the issue of inability of a bandit gang to legitimately own or trade anything being addressed. […]
[…] It’s literally true in the sense that a stateless society would have no government to be the de facto owner of public property. The word privatization, though, is often used to refer to the various sorts of government-business partnerships decried above, which any real libertarian ought to be opposed to. I’ve posted on this topic before. […]
[…] Libertarian Class Theory and a proper understanding of the nature of property rights suggest other potential avenues. As I’ve noted before, the true state is the entire political class, the parasitic net beneficiaries of the coercive apparatus of government. One of the most often overlooked aspects of Rothbards thought is that Lockean property rights exist independently of their recognition by government and that, as a bandit gang, the state can not rightfully own anything. While corrupt government “privatization” schemes that benefit large corporations are thus seen as mere transfer of assets to a different arm of the political class, genuine privatization, or people’s privatization, would consist of extra-legal and decentralized asset seizure from all parts of the political class — cooperation in such seizure resulting not from direction by a Bolshevist vanguard party, but by an interlocking network of private arbitrators recognizing the legitimacy of the new “homesteaders” claims to the formerly unowned parcels of property. […]
[…] As I’ve said before: “There’s privatization, and then there’s privatization“ […]
[…] Because governments systematically violate peoples natural rights in a myriad of ways, they are essentially criminal organizations — bandits — and thus can not rightfully own or transfer any property. This point ought to inform libertarian approaches to privatization, but it often doesn’t. […]