Seriously, though. It’s the best chance we all have for experimenting with smaller governments.

1) The public greatly mistrusts insurance companies. How would they be convinced to accept insurance company services for government? [Though I have to wonder why they trust government more than insurance companies...]

2) Sadly, much of the mistrust is well-placed. Insurance companies enjoy many advantages through regulations, barriers to entry, tax laws and so forth. While the institutions of insurance require massive assets, I’m not convinced that individual companies must be so gigantic. There are markets for sharing risk, and insurance industries fight their development for fear of losing dominance. While insurance companies do compete among each, the level of innovation in a free market would drastically change the industry.

In short, the marketplace could provide the services outlined in this article. But the current insurance industry would probably drastically change if it was to adapt to an unfettered market.

Agreed. He appears to romanticize it.

Have you heard of the Free Town Project in the town of Grafton, New Hampshire?

Grafton has one police officer (who is very kind and won’t bug you if you don’t have a driver’s license), a voluntary fire department, and no zoning laws.

http://freetownproject.com/Finding_the_Free_Town.html

An issue that I cannot resolve in my head – you say:

“insurers will be prevented from engaging in any form of external aggression because any aggression is costly and requires higher insurance premiums, implying the loss of clients to other, nonaggressive competitors.”

How can you guarantee this? What if the two insurers (the plaintiff’s and the defendant’s) cannot agree? Who will enforce this judgment?

He’s also right about the moral and intellectual decay of our society, nothing but a severe wake up call in the form of a police state and a collapsed economy will wake the masses out of their slumber.

The enumeration in the Constitution, of certain rights, shall not be construed to deny or disparage others retained by the people.

Amendment X

The powers not delegated to the United States by the Constitution, nor prohibited by it to the states, are reserved to the states respectively, or to the people.

The real problem, of course, is that the constitution is so vaguely worded that it’s words can be twisted to mean almost anything – including becoming a giant monstrosity that few of the founders would recognize or endorse (maybe with the exception of Hamilton and Morris).

This is actually a rather subtle point. There isn’t actually any distinction in the economics of it if you focus solely on the present, where payments are made, though there often is in the forms and legalities. The difference comes in what is carried forward from earlier.

Say you rent a car; the car was made or bought earlier by the person you rent it from. The rent relates to creating that resource. If a government taxes that car on a continuing basis rather than just on initial purchase, the pattern of payments is pretty much the same but it’s not going towards creating the resource, it’s paying off the government so it won’t stop you having the resource. However, in the present, both forms of payment connect to accessing that resource – so if you just focus there you can only tell the difference from what the payment is called and who gets it. This is ad hoc and can be disguised (suppose the car owner had to pay the tax? a renter would have the payments hidden in the rent, called rent and paid over to the owner – and it would be hidden even more if the tax had been on initial purchase).

Similarly, the rents formerly paid by people in Canada’s Prince Edward Island, say, worked pretty much like land tax, only they weren’t paying off a government to stop it interfering with people who were living there all along, they were paying off proprietors for their past assistance in getting people settled there. Even for people born there, they wouldn’t have been there if their ancestors hadn’t been settled there by others. It so happens that that is a special case, where the proprietors had a windfall gain; they didn’t have to do as much work settling people as expected, because there were a whole lot of Loyalist refugees driven out by the American War of Independence who needed new homes and livelihoods. Still, that was force imposed by the rebels, not by the proprietors. As far as the proprietors were concerned it was matched by the risk they took (suppose they hadn’t been able to find settlers, or if settlers had expropriated them as happened to William Penn in Pennsylvania?). Later, the PEI proprietors were bought out with funds obtained from a bonds issue, which shifted the burden from PEI rents to the Canadian tax base.

There was indeed an injustice to the islanders, that they had to pay rent, and later to all Canadian taxpayers that they had to buy it out. Only, the injustice wasn’t done by the proprietors, it was done by the American rebels who exiled the Loyalists without compensation (breaking the treaty, or more precisely failing and refusing to put it into effect, which was why Britain was not obliged to stop impressing US sailors or to evacuate all posts and so on, until a later treaty superseded that).

But the forms and legalities can be confusing. Sometimes you get a land tax disguised by calling it a quitrent. Only, a real quitrent is paying former users to stop using the land in former ways, say to stop them grazing cattle there so farmers can plant crops instead. Morally, the amount owing corresponds to the opportunity cost, what the former users would have got from grazing the cattle (net). Strictly speaking, if the quitrent is not paid the remedy ought to be grazing cattle on the crops, not eviction let alone the court proceedings, criminal penalties, fines and asset seizures that governments do. So when a government does quitrent, it never was a former user, the sanctions are far greater, and on top of that the amount levied is whatever the government thinks fit. All of that comes from the government’s monopoly of force; they can threaten, enforce and charge more heavily than owners who have to compete for renters in a market, so they can’t make windfall gains above that (even in PEI, since tenants could always go to Ontario, say). It’s not really a quitrent at all, just disguised as that to make it easier to introduce. The government effectively expropriates genuine former owner/users with no compensation or inadequate and time limited compensation, getting no objections from the payers who are used to paying, then gradually changes the rules on the payers. The government benefits from the principle of “an old tax is a good tax”, because it doesn’t have to break in the payers.

How would a private land owner not meet this definition? How would you distinguish a rental payment and a tax?

P.S. Please do elaborate on how people are violating the Constition DS. Are you presuming that people and the Supreme Court are supposed to be interpreting the Constitution in a Libertarian light?

Just look at the 9th and 10th amendments – these invalidate almost the entire workforce of Washington DC, yet are treated as if they do not exist any longer. Try bringing a case to the Supreme Court on the grounds that it violates the 9th or 10th amendment.