There are three questions that must be answered by any supporter of anarcho-capitalism, one per each branch of the government to be dissolved and replaced by a private solution.
1) How do I know what is or is not lawful for me to do? According to what procedure am I to be guided to behave properly? Rothbard’s answer is: use the natural law. To the question, “What is the natural law?” Rothbard replies: “To ask what is man’s nature is to invite the answer. Go thou and study and find out!” (The Ethics of Liberty, 10) But now we are entitled to ask: is the natural law fully sufficient to discover (not “make”) and codify the entirety of the human law? Rothbard seems to think so; “universal laws, locally enforced” is his phrase. But consider the following situation: I am playing loud music late at night. My neighbor is upset and calls the police. Who, according to natural law, must shut up, me or my neighbor? (This is the sort of problem that “law and economics” enjoys posing.) Further, is there any discretion or must the law be the same everywhere? Can custom and common law have any sway whatsoever? In a footnote on p. 17 Rothbard writes:
[Henry] Hazlitt’s reaction to my own brief discussion of the legal norms essential to any free-market economy… was a curious one. While critical of blind adherence to common law in other writers, Hazlitt could only react in puzzlement to my approach; calling it “abstract doctrinaire logic” and “extreme a priorism,” he chided me for “trying to substitute his own instant jurisprudence for the common law principles built up through generations of human experience.” It is curious that Hazlitt feels common law to be inferior to arbitrary majority will, and yet to be superior to human reason!
Rothbard then agrees with Aquinas who says that “the force of a law depends on the extent of its justice. Now in human affairs a thing is said to be just, from being right, according to the rule of reason. But the first rule of reason is the law of nature… Consequently every human law has just so much of the nature of law, as it is derived from the law of nature. But if in any point it deflects from the law of nature, it is no longer a law but a perversion of law.” (ST, II-I, 95, 2)
2) What authority do judicial decisions obeyed by other people have on me under anarchy? Why must I respect the pronouncements of the (private) courts, no matter how high or dignified? Should there be a system of courts which will interpret the natural law at all, or is everyone free to interpret it himself? (Rothbard likes the second alternative:
Many people, when confronted with the libertarian legal system, are concerned with this problem: would somebody be allowed to “take the law into his own hands”? Would the victim, or a friend of the victim, be allowed to exact justice personally on the criminal? The answer is, of course, Yes, since all rights of punishment derive from the victim’s right of self-defense. In the libertarian, purely free-market society. however, the victim will generally find it more convenient to entrust the task to the police and court agencies.” (90))
3) How can a weaker protection agency defend its clients against a stronger agency? Suppose we have a society consisting of 11 people. 4 of them use agency A; 2, agency B; 3, C; and 2, D. Before we had agencies, there were 11 people existing in the state of anarchy doing what each thinks is best in his own eyes. Now that we add agencies into the mix, we have 4 agencies doing exactly the same, namely, what each thinks is best in the eyes of its own owner. There seems to be no difference at all. How does the addition of protection agencies solve the enforcement problem of anarcho-capitalism?