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Libertarian Credo

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In reaction to the Supreme Court's decision backing city seizure of property, Don Boudreaux writes

libertarians reject the notion that the state is something other than a human institution deserving more credence, respect, deference, and trust than is commonly given to other human institutions such as supermarkets and bowling leagues.

That would be an eloquent statement, if we didn't have so many negatives to parse. I would rephrase it:

"Libertarians see the state as just another human institution, with the same moral status as a supermarket or a bowling league."

The libertarian argument is that when one individual or institution takes property from another individual or institution without the latter's consent, we should be alarmed. Even when the taker is the "collective we" of the state.

Regarding the Court decision, more interesting commentary, as would be expected, from Eugene Volokh. But my favorite take is that of Julian Sanchez

For Discussion. From this perspective, what is the difference, if any, between tax collection and the use of eminent domain?

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John T. Kennedy writes:

Does a thief have the same moral status as a grocer or a bowling organizer? The same moral responsibilities yes, but the thief (like the state) is evil in principle as a consequence of the nature of what he does, whereas the others are not.

James writes:

In the 1960's Barry Goldwater said "A government that is big enough to give you all you want is big enough to take it all away." Members of the reality-based community then and since have dismissed this as extremist right wing rhetoric. One of their core doctrines was and is that a government, if empowered to steal, would become a modern day Robinhood, taking away the ill gotten gains of the unjustly rich and giving aid to the little guy. And Robinhood would never sell out.

Some people believe that a theory in the social sciences is only as good as the predictions it generates, so here's one: The recent ruling from SCOTUS won't change any reality-based minds about the merits and likely consequences of empowering governments to steal.

Lancelot Finn writes:

From the perspective of the libertarian credo cited there, there's no difference between tax collection and eminent domain.

The refusal to recognize the role of state, the idea of governmental legitimacy, is what makes libertarian ideology at once brilliant and naive.

Readers interested in this question might be interested in my article "Hobbes, Locke and the Bush Doctrine." Thesis:

A struggle is underway between two ideas: liberal democracy, and sovereignty...

Passing domestic-policy-relevant elaboration:

That the doctrine of popular sovereignty serves as a point of overlap between liberal democracy and sovereignty should not mask the conflict between the ideas, which manifests itself in popular sovereignty's internal contradictions. For the people to deliberate and decide, certain procedures and freedoms must be sacrosanct. But those procedures and freedoms may at times be unpopular, either with the people themselves or with elected leaders who claim to speak for them. Someone, typically the judiciary, must protect these procedures and freedoms. But while judges are thus essential to the maintenance of popular sovereignty, they also have an anomalous position within it, since their own authority is taken to proceed, not (merely) from the people, but (also) from a mysterious entity called the law, which derives its authority from deep and venerated traditions. Where such traditions are absent or weak, popular sovereignty easily turns into populist dictatorship, liberal democracy to libertinism and demagoguery. But if there is a law independent of the people's will, how are the people sovereign?
Lancelot Finn writes:

Sorry to use this site for self-promotion, by the way. But I think those who are inclined to buy taxation-as-theft arguments need to tackle, head on, the widely-believed claim that there is such a thing as a legitimate, or sovereign government, an idea which Hobbes articulated most cogently. This was my best effort to tackle the issue of sovereignty.

James writes:


One reason to reject the concept of legitimate government is that there have been no good arguments to believe that one exists. Philosophers, in their attempts at justifying various states, have defined government in terms of what a government is entitled to do, or in terms of a set of positive attributes. To move from the first approach to claims of legitimacy is to presuppose one's intended conclusion. To move from the second approach to claims of legitimacy becomes an argument for any agency having that set of attributes to be entitled to engage in those behaviors reserved to governments, but the defenders of the state refuse to accept this conclusion.

Another is that even if there are legitimate governments, there is no way to verify that an agency claiming to be a legitimate government really is one. As an empirical issue, there is no way to determine if some group of merry tax collectors is a government because there is no such defining attribute as "government-ness." In practice, such decisions are made by assertion and backed up by force.

Another still is that whatever ethical theory underlies one's philosophy of law must be able to answer the question, "May a non-government entity become a government?" If not, then any government is illegitimate. If so, then this implies a universal right of secession rather than the universal duty of submission that every existing government claims.

Another is that the story of the social contract as told by the British empiricists cannot be distinguished emprically from the formation of a marauding gang with really great esprit de corps. Nor can one verify that the formation of a social contract ever took place. Even governments recognize this problem in their own courts, as I cannot expect to win if I sue you for a debt and simply assert the existence a social contract between you and me.

Yet another is the frequently held selective application of social contract theory regarding obligations to the state. As modern social contract theorists tell it, you enter a social contract by driving on government owned roads or partaking of other government services. Must an entity be a government prior to gaining the priviledge of forming social contracts the way that a government does? Is so, then governments could not have formed by social contract. If not, then even governments must submit to social contracts when, for example, an IRS agent drives on a privately paved road. But the statists who make the "when you drive on these roads..." arguments are never willing to accept this conclusion.

Finally, since you mention this in the context of taxation, we could go on and suppose that there really are legitimate governments. Why do the arguments against allowing me and my hundred dearest friends to tax people not also apply to governments? Or, reflexively, if taxation is so great, why not let everyone do it?

eddie writes:

From the libertarian perspective, there is little difference between taxation and eminent domain. Both take property using force. Since (unfortunately) most people don't share the libertarian perspective, most people see a difference between taxation and eminent domain, albeit one that is in my view sentimental rather than rational and thus rather un-economic-ish. The difference is that real property is not fungible.

Money is just money. You win some, you lose some. Sure, it sucks that the government takes so much out of your paycheck, but as long as everyone is paying their fair share, it's not so bad (so goes the common view). But your house or your parcel of land is different. You've just got the one, and it is unique, and the uniqueness of it is special to you. Getting compensation for it doesn't change the fact that they took something and can't truly replace it (so goes the common view).

I think this view makes eminent domain unsympathetic in the views of the average person.

However, the uniqueness of property cuts the other way, too. We need a road (or an airport or a shopping mall) and we need it right here, no other place will do. When everyone else has agreed to sell, the one guy holding out for more money suddenly becomes the bad guy holding up progress, not the little guy getting squashed by an uncaring government.

As Don pointed out in this earlier Wall Street Journal online debate about the Kelo case, contingency contracts are an economically efficient way to solve the holdout problem without using force. Alex Tabarrok has suggested using dominant assurance contracts as a way of providing public goods without using force. So here again, from a libertarian perspective, eminent domain and taxation are the same, in that we don't actually need either of them in order to accomplish what most people think they are needed for.

Lawrance George Lux writes:

The real argument to be used in Kelo v. New London stands as Tax payment for the security of Property rights. The Kelo argument should have insisted New London repay all Property taxes paid on the Properties by Residence holders, as well as Fair value for the Property, if eminent domain was to be used lacking any Government use or need for the Property. lgl

Nicholas Weininger writes:

From a Hayekian point of view, eminent domain is more like ordinary private theft than are most forms of taxation. Taxes are typically levied impersonally on large groups of people and are applied in predictable ways, so their effects can be known in advance and incorporated into individuals' plans. Eminent domain affects people haphazardly and arbitrarily and creates an exogenous risk that is difficult to quantify and hedge against; it is more like the "rule of men" and less like the "rule of law".

The compensation requirement mitigates the size of this effect but does not change its character. The difference between the true value of a property to its owner and the lowball "market value" compensation proffered by the government is a real cost that falls entirely on the owner, while any corresponding benefit is either spread over many members of the community or (as in the Kelo case) accrues to another, more politically favored private interest.

josh writes:

One difference between a tax and imminent domain as they exist in their present forms, is that eminant domain seems to be an arbitrary tax. One can not prepare for it and maximize ones utility subject to it. Rather one could, but there are uncertainty costs associates.

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