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Source link: http://archive.mises.org/5355/natural-elites-intellectuals-and-the-state/

Natural Elites, Intellectuals, and the State

July 21, 2006 by

There are two theories on the origin of states, writes Hans Hoppe. One view claims that states originated as the result of the military conquest of one group by another. This view suffers theoretically from the problem that conquest itself seems to presuppose a state-like organization among the conquerors. Hence, the exogeneous origin of states requires a more fundamental theory of the endogeneous origin of the state. States are the outgrowth of natural elites. FULL ARTICLE


Vicente Barriatos July 21, 2006 at 4:44 pm

The only contention I really have with Dr. Hoppe’s article is in the passage:

“Rich men exist today, but more frequently than not they owe their fortunes directly or indirectly to the state. Hence, they are often more dependent on the state’s continued favors than many people of far-lesser wealth. They are typically no longer the heads of long-established leading families, but “nouveaux riches.” Their conduct is not characterized by virtue, wisdom, dignity, or taste, but is a reflection of the same proletarian mass-culture of present-orientation, opportunism, and hedonism that the rich and famous now share with everyone else. Consequently — and thank goodness — their opinions carry no more weight in public opinion than most other people’s.”

Of course in today’s society– especially in the United States– everything is practically dependent on the State, but I believe one should not be so impetuous when it comes to passing a bold generalization on the “New Rich.” There is definitely a distinction between a Tom Delay and a Warren Buffet when it comes to businessmen.

People are not determined beings a person’s wealth can help or hinder them. It’s what you do with the money that counts. A unworthy heir will spend money without any regard to where and how it was created. And of course inherited wealth is the best alternative to where that money would have went– the government. And one must ask the question: Who is the rich? In the issue of “The Economist” about the growing inequality of Wealth in America it stated that the top 1 percent of Americans make 18 percent of income throughout the United States, but the bulk of income, and savings, still comes from the middle class. Not everybody fits the same mold so to speak. Therefore, we should be more cognizant of the individual, and not subsume people under classes or “proletarian mindsets.” Nor relegate standards of morality or virtues on the rich without going more in depth than just some bold generalization.

Paul Edwards July 21, 2006 at 6:58 pm

I thought i could get away with a quick scan but was compelled to read the whole thing. That was a truly great article!

government worker July 21, 2006 at 8:41 pm

As one that as lived the bifurcated life (public democratic advocate simultaneously morphed into private gain thru public connections), I can attest that every bit of what HHH is saying is true and true big time.

I know other public officals that have dwarfed my bifurcated achievements to the tune of millions.

scrivener July 21, 2006 at 8:57 pm

Vincente Barriatos, do you know who Warren Buffet’s father was? It is not as if he built himself up from working at a Dairy Queen. The ties between Berkshire Hathaway and the state run deep.

Nick Bradley July 21, 2006 at 10:12 pm


Berkshire Hathaway is TOTALLY dependent on the state. The primary way Buffett’s firm makes money is buy buying up small companies and making them more profitable. However, he uses the estate tax to leverage family businesses to selling when the propietor dies.

M E Hoffer July 21, 2006 at 10:59 pm

it’s been long remarked that: the free-market may create Millionaires, but it is the State that makes Billionaires.

As a pithy toss-off, more accurate than not, by a long shot.

TGGP July 22, 2006 at 8:47 am

I had trouble finding anything on Muehlman (I had to babelfish a german wikipedia page), but a quick search on Bertrand de Jouvenel makes it seem like he shared the same view on the origin of the state as Ruestow, Oppenheimer and Nock. According to http://www.acton.org/publicat/m_and_m/1998_oct/luckey.html Bertrand thought “Conquest, and nothing but conquest, gives birth to large formations.… It follows that the state is in essence the result of the successes achieved by a band of brigands who superimpose themselves on small distinct societies.”

I haven’t read the book by Jouvenel linked in the article where perhaps he gives a different explanation. If Hoppe is correct in that the natural elites inevitable tend to form monarchical governments and then turn democratic, how might that process be prevented from occurring again once the western welfare states inevitably* collapse?

*I should state that it is not my opinion that such is the case. I think anarchy is gone for good and there is no reason to suppose that welfare states cannot continue indefinitely, or even that such extreme versions of Stalinism as North Korea cannot maintain the Orwellian future of the “boot stamping on a human face forever”.

Brett Celinski July 22, 2006 at 3:35 pm


When humans formed states way back, I am sure that their use of brain space was not high enough to comprehend the division of labor until its results were seen soon after.

Do you really think just because some people believe in force, that that makes the state immortal?

Brett Celinski July 22, 2006 at 3:41 pm

And moreover, since Iceland lasted longer than America’s (brief) classical liberal period, is not the specialization of knowledge that people now continue to experience a good deterrent for livng without the state? True, I don’t really see the existence of a total free market society inevitable, certainly not in the next decades.

Yet I don’t see how big armies can easily crush determined opposition (as historical evidence shows), and at the rate things go, we either get Soviet Union 1991 all over again or Orwell. You think we are reaching Oceania? Are the benefits of the Industrial Revolution entirely forgotten? Is technology really becoming static and the peoples’ knowledge of a situation with lack of government intervention decaying?

If so, your predictions would make Nostradomus cry on his Myspace site. I hope you aren’t right… :|

TGGP July 22, 2006 at 5:53 pm

Regarding my predictions, I think Orwellian dystopias will be only a minority of the countries. Most will be bumbling democracies with burdensome welfare states and a good deal will be dysfunctional kleptocracies. There will a sizable continuum with regards to freedom, and countries will wax and wane in their amount of it as reformers manage to grasp power for a bit and later on people lose their appreciation for it and start thinking wishfully rather than using their heads (Schumpeter predicted that capitalism was doomed because it produced enough wealth to support intellectuals who will agitate for its destruction; I think he was only part right and that it is not completely doomed and so propose a new word for its fate: dummed).

I think that government is inevitable as long as human nature is statist, and that human nature is largely fixed for statism due to so much evolution taking place in a pre-capitalist society. That being said, the amount of statism is what I am interested in. Essentialists are missing the boat; life is about probability and averages rather than binary conditions.

Brett Celinski July 22, 2006 at 10:26 pm


in all aspects, I think your description would be the case for the forseeable future. Yet there have been Icelands (which weren’t Utopias), and I see the possibility of those emerging possible.

Once that happens, though, such a situation would be well in place for a good while. I think once intellectuals begin to question the idea of centralized defense… yet since most intellectuals have for the longest time in history been allies/pawns of the state, and those that witnessed the producers continue to be a minority…

Christy Welty July 23, 2006 at 4:37 am

Kudos to Professor Hoppe for an essay that goes to the bone of the causes and cures of statism. Excellent points!

However, IMHO, there is an inconsistency in the final paragraph where Hoppe shills for the Mises Institute (and a fine institute it is). This paragraph is consistent with Hoppe’s general contention that the natural elite’s are lost, but he also contends that intellectuals are lost, in about the same proportions, as far as I can tell. Yet, he holds out hope for courageous intellectuals to succeed at their natural duty.

On the other hand, he claims that the only way a natural elite can succed at his natural duty is to support the Mises Institute. To be consistent, a courageous natural elite ought to be credited with enough substance to find his own intellectuals to support (some of which might be connected with the Mises Inst), and not be dependent on a bunch of self-selecting intellectuals to do that for him. Or maybe that was all just a tongue-in-cheek finish for an otherwise serious essay. ;)

Roger M July 24, 2006 at 9:32 am

Although I arrive at many of the conclusions that Hoppe does, I don’t recognize his descriptions of the virtues of monarchies before WWI. The Dutch and Americans didn’t rebel against monarchies because they did such a wonderful job of protecting private property as Hoppe suggests. In fact, if your read Peter de La Court, monarchs and the nobility were nothing but thieves.

And the natural elite of the Middle Ages, the nobility, died out because of warfare, excessive spending and very poor business skills.

As for how people become wealthy in the US, Dr. Thomas Stanley has shown that 85% of people with a net worth of $1 million or more, including billionaires, earned their wealth by growing a business. About 5% made it through high paying jobs, and about 3% inherited their wealth. But our wealthy are no different from the nobility of the past in that they don’t pass on their values to their children and their accumulated wealth is dissipated by the succeeding generations.

Paul Edwards July 24, 2006 at 10:47 am


You write, “I don’t recognize his descriptions of the virtues of monarchies before WWI. The Dutch and Americans didn’t rebel against monarchies because they did such a wonderful job of protecting private property as Hoppe suggests. In fact, if your read Peter de La Court, monarchs and the nobility were nothing but thieves.”

But I wonder if you skimmed Hoppe’s article a little too hastily. Your comments suggest you missed some points, such as that it was the kings of more recent times who attempted to use the intellectual to pervert ancient law and to establish their own monopoly on justice by excluding competition in this area by the natural elites. Here are a couple excerpts:

“It is also no wonder that intellectuals could be won over easily by a king in his attempt to establish himself as the monopolist of justice.


“It was the inflated price of justice and the perversions of ancient law by kings as monopolistic judges and peacekeepers that motivated the historical opposition against monarchy. But confusion as to the causes of this phenomenon prevailed. There were those who recognized correctly that the problem was with monopoly, not with elites or nobility.


“How ironic that monarchism was destroyed by the same social forces that kings had first stimulated and enlisted when they began to exclude competing natural authorities from acting as judges: the envy of the common men against their betters, and the desire of the intellectuals for their allegedly deserved place in society. When the king’s promises of better and cheaper justice turned out to be empty, intellectuals turned the egalitarian sentiments the kings had previously courted against the monarchical rulers themselves.”

Tom Blooming July 24, 2006 at 3:04 pm

Very good article. The paragraph that really resonated with me was the one that discussed how those who speak the truth will be marginalized: “Indeed, not only does one have to accept that he will be marginalized by the academic establishment…”

I was especially struck by these sentences: “Yet throughout their lives, they [Mises and Rothbard] never gave in, not one inch. They never lost their dignity or even succumbed to pessimism.”

As impressive as it is to have never given in, I am even more impressed by the positive attitudes they maintained. While I feel that I can accomplish the former (never give in to get along), I have no idea how they did the latter.

Paul Edwards July 24, 2006 at 7:45 pm


I think Rothbard answered the question of how he avoided succumbing to pessimism in “For a New Liberty” in the great section titled “Why Liberty Will Win”:

“… libertarianism will win eventually because it and only it is compatible with the nature of man and of the world. Only liberty can achieve man’s prosperity, fulfillment, and happiness. In short, libertarianism will win because it is true, because it is the correct policy for mankind, and truth will eventually out.

“The clock cannot be turned back to a preindustrial age. Not only would the masses not permit such a drastic reversal of their expectations for a rising standard of living, but return to an agrarian world would mean the starvation and death of the great bulk of the current population. We are stuck with the industrial age, whether we like it or not.

“But if that is true, then the cause of liberty is secured. For economic science has shown, as we have partially demonstrated in this book, that only freedom and a free market can run an industrial economy. In short, while a free economy and a free society would be desirable and just in a preindustrial world, in an industrial world it is also a vital necessity. For, as Ludwig von Mises and other economists have shown, in an industrial economy statism simply does not work. Hence, given a universal commitment to an industrial world, it will eventually—and a much sooner “eventually” than the simple emergence of truth—become clear that the world will have to adopt freedom and the free market as the requisite for industry to survive and flourish.”

Juan Garofalo July 25, 2006 at 2:34 am

For the record, I think that almost all classical liberals believe(d) that the state originated in military conquest. At least, people like H. Spencer, Bastiat and de Molinari did…
At any rate, the theory about ‘natural elites’ and ‘intelectuals’ seems to overlook free will.
The state exist because of people’s choices. It’s not a necesary evil. It is simply evil. I consider naive to believe that, if the ‘intelectuals’ changed their statist tune for free-market-Individualism, people would act different than they do now.

Rob July 25, 2006 at 7:53 am

…I don’t recognize his descriptions of the virtues of monarchies before WWI…..

The Spanish and the English monarchies of the 17th and 18th centuries were far less confiscatory than any modern democracy (The Crown’s tax burden upon a land-owning American colonist at the time of the Revolution has been variously estimated between 3 & 8 %.). This is the point Prof. Hoppe was making. By this fact alone, they evidenced a greater respect for private property than the ‘free’ states of today.

We are raised reading of the excesses and capriciousness of the European hereditary states. They are, therefore, inked in our minds as every way inferior to ‘Democracy’. As is often the case, the facts of history don’t fully support the public school view. The reality is, as Prof. Hoppe showed, that in many ways these states were more honoring of the values we Libertarian/Anarchists cherish than modern democratic governments have ever been.

I don’t vote because I don’t want to be party to violent coercion. This makes democracy a non sequitur for me. It is not ‘better’ than monarchy any more than lethal injection is better than hanging as far as I am concerned. I side with Prof. Hoppe when he says it is a grave error to equate democracy with freedom. That idea, like so many others, is just another lie of the state.

Roger M July 25, 2006 at 8:58 am

Rob:”The Spanish and the English monarchies of the 17th and 18th centuries were far less confiscatory than any modern democracy.”

That may be true if you consider taxation only. But those same monarchies were extremely corrupt and raised a lot of their money by selling offices and monopolies on trade, through warfare, forced borrowings and a enormous amount of just pure theft. Taxes played a small role in supporting monarchs.

The monarchies of the 19th century did clean up their act some, but only in response to the growing competition from young democracies.

Monarchies were far more evil than Hoppe wants to admit, and republics, like the Dutch Republic, protected property to a far greater degree than did monarchies until the 19th century.

Democracies aren’t inherently socialistic, even though they are today. We turned that way when most people became convinced of the benefits of Marxism. So the problem isn’t with democracy, but with the dominant philosophy of the people. As for monarchies, has Hoppe looked at the remaining monarchies in the world today, such as Saudi Arabia and Morocco, and concluded that they do such a wonderful job of protecting private property? I doubt it.

The US has made great strides toward rolling back socialism since the election of Reagan, and we can continue to do so. If the system collapses, as Hoppe hopes, I doubt the that anarchism will result. Look at the experience of Russia. Organized crime ruled for the first decade after the fall of the Soviet Union.

Rob July 25, 2006 at 9:44 am


The overall point is not the goodness of monarchy; it is the badness of democracy. We cannot look to the democratic structure itself as inherently better than other methodologies of the state. Now the US framers thought that it might be, but they were historical pioneers (plus their original schema was far less ‘democratic’ than the current one). We have a century of data now that shows democracy has allowed for the advancement of state power of a magnitude and velocity that had never before been seen on this planet. From the perspective of human freedom, democracy is the worst form of the state.

And it is not only taxation at issue. Modern states monopolize, regulate and confiscate more than any Enlightenment monarch would have dare dreamed. Were it not for the attempted utopias of last century, one would have to look to the ancient oriental despots to find states that approached the level of control exerted over daily lives than the modern western states. And I submit that the continual growth of the state is the inevitable outcome of democracy. Everyone wants change and they want it in the next 2-4 years. Democratic success will always be marked by the officeholder who ‘does’ the most during his term and ‘doing’ things in government always means consuming more wealth and curtailing more liberty than the guy before.

Roger M July 25, 2006 at 12:03 pm

Rob:”Modern states monopolize, regulate and confiscate more than any Enlightenment monarch would have dare dreamed.”

I don’t think so. You should read about the great Colbert who controlled the French economy, and read about Spain during that time. Your statement may hold true for England during that period, because the parliament restrained the King. But it was the rising desire for democracy that reined in the monarchs, not something inherently better in monarchies, otherwise benevolent monarchies wouldn’t be so rare.

If earlier monarchies were worse than later ones, what caused the change? One writer argues that it was the “rational revolution” that the Protestant reformation initiated. And if earlier democracies, such as the early days of the American revolution, were better than later ones, what changed?

I see in Hoppe’s writing the straw man technique, where he invents monarchies and democracies that never existed in order to make anarchism more attractive.

Roger M July 25, 2006 at 3:39 pm

Another aspect that we need to consider when we compare state spending of monarchies from centuries ago to democracies today, is relative wealth. Under the monarchies of two centuries ago, people were poor compared to today. Almost all of their income went for food, clothing and shelter. This limited the percentage of income that the state could take in taxes, otherwise, the people would starve. History shows that monarchs wanted to take more; they had numerous ingenious schemes for doing so, but the people just didn’t have the money.

Today, our comparatively wealthier democracies have reduced the percentage of income required for the necessities of life, therefore the government can’t extract a higher percentage.

I would like to see the US move much closer to Hoppe’s anarchism, but I don’t see how trashing democracy will help.

Paul Edwards July 25, 2006 at 4:44 pm


We don’t need to depend on Hoppe for a good trashing of Democracy. Try these on for size:

“A democracy is nothing more than mob rule, where fifty-one percent of the people may take away the rights of the other forty-nine.”
Thomas Jefferson

“The majority, oppressing an individual, is guilty of a crime, abuses its strength, and by acting on the law of the strongest breaks up the foundations of society.”
Thomas Jefferson

“Democracy is two wolves and a lamb voting on what to have for lunch. Liberty is a well-armed lamb contesting the vote!”
Benjamin Franklin

“Democracies have been found incompatible with personal security or the rights of property; and in general been as short in their lives as they have been violent in their death.”
James Madison

“Despots and democratic majorities are drunk with power.”
Ludwig von Mises

LOL! One only has to speak the truth about democracy to trash it. I wonder what good old Ben was thinking of when he mentioned the “well-armed lamb”. I tend to think of the libertarian-anarchist there.

Roger M July 25, 2006 at 5:34 pm

I think there’s a confusion on terms. Hoppe seems to use the term democracy in the same way it’s used commonly today to refer to the US system of government and those of Europe as opposed to dictatorships and monarchies. Jefferson, Franklin and Madison used the term to refer to the absolute rule of the majority, which they saw as evil. Which is why they strongly opposed a democracy for the US and insisted upon a Republican form of government with a constitution and the rule of law to restrain the mob.

If Hoppe didn’t intend to include the US in his argument against democracies, because the US is a republic, then I withdraw most of my reservations about the article.

I’m not sure what Mises was referring to.

Paul Edwards July 25, 2006 at 6:59 pm


The US was a republic. That changed with the advent of the 17th amendment.

Take a quick read of Thomas DiLorenzo’s “Repeal the Seventeenth Amendment” at http://www.lewrockwell.com/dilorenzo/dilorenzo93.html .

The senate was supposed to be key to the balance of powers and the maintenance of the Republic through the appointment of senators by state legislatures. Senators are now elected by popular vote. It seems to me that what the US has now is quite democratic.

But what is it about this process that you find to be significantly better than democracy? To me it feels very much like the wolves have decided what they want, and the sheep are quite outnumbered and out-gunned.

gerry July 26, 2006 at 5:52 am

HH Hoppe brilliant as he is shows us ‘little people’, that there is essentially no hope.

If he and other brilliant thinkers of high moral standards have not succeeded in the last 70 years to raise the level of awareness and build a counter-pressure then truly the ‘other’ powers are overwhelming. Why? The ‘one man one vote’ also applies to all those who receive income from the state(salaries, pensions, entitlements, tax breaks, etc.). They will never bite the hand that feeds them. And morality stops where hunger and greed takes preference.

As HHH points out in his book ‘Democracy’ we/they will drive this ‘thing’ into the ground – redistribution will lead to a common level of poverty.

What can be done? Very little.

Making the noble goals for the natural elites transparent such that they can act – and this is what is needed – will most likely not be in funding anti-intellectual intellectuals. It still needs to take into consideration the current forms of government, rather the monopoly of law makers. And they are not noble as we have seen.

Even in alerting the likes of Bill Gates, Buffet (Berkshire-Hathaway), Goodnight (SAS), Hopp/Plattner (SAP) etc., and, soon to be reckoned with, elites in India and China will not do the trick, they each have one vote only. Perhaps to raise the level of awareness the natural elites should engage the best PR and marketing firms to get the HHH’s et.al. message across, to build momentum and perhaps thus change some laws.

Passive resistance (e.g. abstain from voting) will also backfire – few if any constitutions have a cut-off level for voters participation to be regarded as a valid election and thus constitute a quorum.

Roger M July 26, 2006 at 8:44 am

Paul:”To me it feels very much like the wolves have decided what they want, and the sheep are quite outnumbered and out-gunned.”

I have to agree with you there. The current republic is nothing like the original. We still have the Constitution and the separation of powers between the three main branches, and no direct vote of the people, so we’re still technically a republic. But a lot has been lost along the way. I’m not optimistic about the future, but I have seen small changes in the right direction over the last 25 years.

For those who are waiting for a collapse, I hope you have a lot of patience. Look how long N. Korea and Cuba have hung on to Stalinism. Also, the people of Iran have lost 3/4 of their wealth since the revolution, but they have no intention of changing things. Europe is a lot farther down the path of socialism than we are, and no where near collapse.

So the only thing we can do is keep trying to teach the people the truth. For all their faults, I think the radio talk show hosts have been doing an excellent job for us. Especially Limbaugh. His economics are very close to libertarian. Some, like Bill O’Reilly, don’t have a clue. But Limbaugh has an audience of 20 million.

Befree July 27, 2006 at 8:31 am

Anarchist is an inaccurate word to use when describing the concept of a progressive society without government. Anarchist disparages the concept because one of its dictionary meanings is “Absence of any cohesive principle, such as a common standard or purpose” and libertarians are all about principle leading to progress. Another meaning is “a state of lawlessness and disorder (usually resulting from a failure of government)”. The implication of this is that without good government there can be no progress.

Libertarians all agree that less government is better but vary on how little government is good. Mises said we need some government that is well proscribed and Rothbard thinks that very little government, no matter how well proscribed, is like a little cancer. I don’t know, no one knows, its never been tried. I think most libertarins would agree that we should establish a guideline of principles that keeps evolving socioeconomic systems in the direction of less government and keep going as near to no government as we can get.

On a personal level I encourage my family to understand freedom and live it. My personal highest law is the principles I believe in. My society is my family. There is a risk in living like this in this world but each of us is free to seek our own understanding and capable of choosing to live it. In an informal way, every businessperson and consumer who knowingly participates in underground commerce chooses freedom. Freedom is not dead and unless the human nature is deliberately reenginnered by bad science so that it comes to enjoy slavery, freedom can never die. Man was created by a higher force to be free and progressive. No “intellectual” can change that. There will always be hope. We must learn hope, teach hope to our children, and as far as is possible live hope whilst building our own families means and principles. As adults we must choose who rules and schools us. In my opinion the Mises institute is a small light in a vast darkness. Before I knew about Mises I held thier sentiments but thought I was alone. Now I know I am not crazy. Judging by the size of the underground economy worldwide I suspect that there is a lot of latent potential waiting to catch fire. Never quit, relentlessly rage against the dying of the light.

Daniel M. Ryan November 7, 2006 at 1:54 pm

Genuine intellectuals have little to worry about when it comes to their students becoming rulers later in life. The typical ruler does respect independence, and the independence of mind and spirit which a real intellectual cultivates is genuinely respected by a member of the natural elite.

The trouble is, of course, that too many intellectuals decide that this respect means that intellectuals themselves belong in the ruling class!

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