Libertarianism is not Madisonian Democracy

A writer at The League of Ordinary Gentlemen attempts to deduce that Libertarianism implies Madisonianism.

Conclusion: Libertarians are Madisonians (but not vice-versa)
Because libertarians believe humans are not angels, they grudgingly accept the necessity of some degree of government. But because they believe humans are not angels, they are also desperate to keep that government very limited. That is, in fact, precisely Madison’s position. He said, “if men were angels, no government would be necessary,” and that because governments were administered by men, rather than angels, it is necessary “oblige [government] to control itself.” To the extent they differ from Madison, libertarians are just more dubious about the capacity to make government self-controlling. This does not mean Madison was a libertarian–that would be anachronistic, at best–but it does mean libertarians are tolerably Madisonian.

But believing humans are angelic? That is a fundamental misunderstanding of the conceptual foundations of libertarianism.

Let’s look at the logic of this. For starters, I have never have liked the famous Madison quote: “if men were angels, no government would be necessary.” Here’s the way I would more meaningfully phrase it: “if there were no scarcity, then no governance would be necessary.” Scarcity creates the need for governance. And notice I’m using the term “governance” and not “government” because the latter term is synonymous with the State. I do not think scarcity necessarily implies the State, which is one particular form of institutional governance.

“Angels” are fictional entities that reside in some supposed ethereal “godly” world of non-scarcity. If these “Angels” were transplanted into our actual empirical world of scarcity, they would act like humans. If humans had the luxury of a world without scarcity, they would act like angels. So let us drop any reference to “angels” and understand the actual context is scarcity. Any charges of “angelic assumptions” are equivalent to charges of “non-scarcity” assumptions, the latter being clearly something libertarians would not be credibly accused of holding, at least not as a premise.

So the typical logical refrain:

men are angels –> no government
no government –> men are angels

which is taken to mean libertarians assumes “angels,” is bogus logic.

A Scarcity Model
Let’s write out the actual logical relationships and principles.

S=scarcity
G= the set of all possible institutional governance arrangements, {g0,g1,…gN}, that have a cooperative equilibrium
g=some element gi ∈ G
ST=The State, a subset of G(ST ⊂ G). The State is the set of all g ∈ G where the cooperative equilibrium is enforced by a territorial claim on a monopoly of violence

The General Scarcity Principle(GSP)
(i) S <–> g

The Weak-Form Scarcity Principle(WFSP)
(ii) ST –> S

The Libertarian Principle(LP)
(iii) There exists a subset L ⊂ G where for all g ∈ L, the cooperative equilibrium does not make anyone worse off relative to the defection state(no cooperation).

The Natural Law Principle(NLP)
(iv) |L|=1

The Utopian Principle(UP)
(v) L –> ~S

The Strong-Form Scarcity Principle(SFSP)
(vi) S –> ST

The Orwellian Principle(OP)
(vii) all g ∈ ST will converge to a neighborhood of a single arrangement in ST. That is, all institutional arrangements in ST will, over time, converge to the same thing. So ST will equal O, where |O|=1.

The Dystopian Principle(DP)
(viii) (UP)∧(SFSP)∧(OP)

(i) simply means that scarcity implies some form of governance g in G and any g in G implies scarcity. This is the General Principle.
(ii) means that the State, in whatever form, implies scarcity, but scarcity does not imply the State(g ∈ ST). This is a weak inference that follows trivially from the General Principle.
(iii) The Libertarian Principle simply means cooperative equilibrium constrained by no rights violations.
(iv) The “Libertarian cooperative equilibrium” is unique.
(v) The Utopian Principle is the contention that libertarianism ends up implying non-scarcity. In our model, this would mean that libertarian constraints could not enforce a cooperative equilibrium. So L is not an element or subset of G. Therefore, scarcity would be a sufficient condition to disqualify libertarian institutional arrangements.
(vi) The Strong Form Scarcity Principle, which can also be thought of as the “Inevitability Principle,” is a contention that Scarcity ultimately converges the set G to a specific class of institutional arrangements–the State, ST.
(vii) The Orwellian Principle is that Totalitarianism is the long run evolutionary equilibrium of the State
(viii) The Dystopian Principle guarantees the Orwellian outcome.

Applying the Scarcity Model
Now that we have taken the time to define our terms and establish some logical principles, let’s see where this model might leads us.

Point I:
Scarcity puts cooperation and cooperative equilibrium, not justice, at the foundation of governance. “Justice” is a moral judgement ranking of the set G.

Point II:
Few will likely object to the libertarian principle as stated above. That’s because it’s not stated as a set of moral judgements but rather as a cooperative constraint. The Devil, of course, comes when one investigates what type of institutional governance arrangements would be consistent with such a constraint. This question is not one I’m not particularly interested in this current context; but I am interested in what arrangements would be in violation of this constraint.

But first, let us knock down the Utopian Principle. This only requires one to demonstrate that the libertarian constraint can result in a cooperative equilibrium.
Here we can turn to the work of David Gauthier who demonstrated that one-shot non-cooperative games constrained by the following:

(1) Constrained Maximization
(2) Maximin Relative Concession
(3) Libertarian principle

result in a cooperative equilibrium equivalent to the Kalai-Smorodinsky bargaining solution.

A previous post, The Moral Bargain, goes into more detail about the Gauthier Solution.

The Gauthier moral agent is not some super IQ Libertarian moralist. Indeed, the Gautheir moral agent is assumed a minimal moral foundation and a prerequisite cognitive ability that only needs to understand the concept of Games. This means that the solution is not restricted to a sub-population of those who are two-standard deviations or more(right-asymptotic limit) from the statistical mean of some normal IQ distribution. This assumption is often part of the commentary. Actually, the problem for the Gauthier Solution is the left-side of the asymptotic limit, for those who are two-standard deviations from the mean, implying a mental incapacity to contract. This exclusion zone would also include children.

Point III
The Gauthier Solution demonstrates that (modest) scarcity does not imply L = ∅. So we have dispatched with the Utopian Principle. But this does not mean that L ⋂ ST = ∅, meaning that the libertarian equilibrium is necessarily outside the State set. After all, wasn’t it Nozick who showed that a cooperative equilibrium with no rights violations would still result in the State? This conclusion in no small part is based on the assumption of coercive force being a natural monopoly.

In our model, this means that ~(UP) is not a sufficient condition for ~(SFSP). But can we try to use LP to indirectly establish ~(SFSP). Here we obviously agree that any institutional arrangement g ∈ G with a “Dominant Coalition” invalidates LP. Can we demonstrate that all g ∈ ST have dominant coalitions? Perhaps not directly, as a logical deduction, but perhaps indirectly, if we assign a max-min ordering/ranking of the set ST and then demonstrate that both the max and the min elements of this “ordered set” ST have dominant coalitions(“ruling classes”).

This ordered set ranking is exactly what the League of Ordinary Gentlemen proposed in terms identifying Madisonian Democracy with a minimization of coercion rank. Obviously, the max ranked element of this set has a ruling class but will the this min ranked element of ST, Madisonian Democracy, also have a dominant coalition?

This where “Public Choice” kicks in, since the Virginia School, via “The Calculus of Consent,” was supposed to demonstrate that rent-seeking coalitions in Madisonian Democracy were not Dominant Coalitions. However, as it turns out, the rent-seeking industry(outlays) is way too small relative to the economic rent transfers, empirically establishing a counter-factual to the very criterion against a ruling class.

The “ruling class” problems with Madisonian Democracy, which thusly disqualifies MD from being identified with the LP, also serves to indirectly invalidate SFSP.

Point IV
It may be counter-intuitive how a “scarcity model” can actually dispense with UP and SFSP. But what about (OP)? We should recall that Orwell was directly influenced by Hayek’s “The Road to Serfdom.” We should also recall that Hayek’s book, in context, was that National Socialism and Fabian Socialism led to the same thing(it is completely erroneous and out of context to try to use “The Road to Serfdom” as a diatribe against welfare capitalism). Orwell, however, unlike Hayek, also thought whatever version of capitalism would lead to the same type of convergence. Thus the “Orwellian Principle.”

During Orwell’s time, the set ST was characterized by State Socialist and Capitalist polar ends. But now the State Socialist elements have been discarded and we see convergence by the likes of China and Russia with the United States. In the Orwell vision, it didn’t matter who won the “cold war,” there was going to be convergence one way or another. This was his insight.

OP may simply be a consequence of the fact that a monopoly of violence, in whatever configuration, universally serves no real basis for a rational constraint in the conflict over economic surplus in the context of scarcity.

So with no UP and no SFSP, but with OP, we can see that instead of some “inevitability principle,” it may be more of a question of libertarianism vs authoritarianism.

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8 thoughts on “Libertarianism is not Madisonian Democracy

  1. Man, I really don’t understand philosophy.

    I think I barely can wrap my head around your conclusion, but I don’t feel too confident.

    I think there’s a clear empirical case to be made against Madisonian Democracy. I doubt you’d really want to adopt our presidential system again if you had the US start all over again.

    • The impetus for the post was debunking (1) libertarians are necessarily Madisonian and (2) the accompanying commentary that (i) libertarianism is utopian (ii) it would only work for a high IQ population subset (iii) the State is inevitable, etc….

      The Philosophy/methodology used to debunk these things borrows from Hobbesian Social Contract Theory. Scarcity is what creates the “state of nature.” The State of Nature is a suboptimal state of non-cooperation–the state of defection.

      So let us agree with Hobbes’ premise but not his conclusion. For Hobbes, the rational agent will cede authority to the leviathan. Libertarianism however holds that humans can bargain their way out of the State of Nature.

      David Gauthier’s paradigm essentially rests on cooperation creating “surplus” that incentivizes equalizing constraints on rational self interest. We move then from Hobbesian rationality to one of rational moral constraints. The Libertarian Principle, which is a revised Lockean Proviso, is that no one is made worse off by the cooperative equilibrium relative to the defection state.

      We form a “Scarcity Model of Governance” because it is scarcity that prompts cooperation as a means of creating surplus that turns humans into social animals operating in an institutional context, whether formal or informal. This is how we then arrive at our set G. From here we can then logically formalize a number of principles that are often alluded to in commentary, but often without any real logical translation.

      In the end, it is to everyone’s advantage that a social order exists, but it is also to everyone’s advantage to “free-ride” from the benefits. But the problem of “free-riding,” from a rational perspective, may be much less of a problem than the one of inability of restraining dominant coalitions from consuming the benefits/surplus of cooperation.

  2. Starting with
    men are angels –> no government
    no government –> men are angels

    You might have skipped the symbolic logic (a course I despised in college) and said
    when Larry’s home –> beer is in the fridge
    beer is in the fridge –> Larry’s home

    The inference is false because Joe, who also likes beer, could have stocked the fridge.

    • Thanx for commenting…

      btw, you are referring to the “Affirming the consequent” fallacy. I’m well aware. One of the points I was making was a rejection the angels-government logical relation to begin with and recasting it into a “scarcity model;” hence the need for a construction of logical principles within that framework.

      cheers

  3. So we form social institutions, governance, to move beyond a suboptimal state of non-cooperation caused by scarcity (agriculture, for the most part). This is difficult, because there are incentives to free-ride. But if we can overcome that obstacle we still have the difficulty in restraining rent-seeking coalitions from consuming the surplus created by cooperation.

    Yes?

    • So we form social institutions, governance, to move beyond a suboptimal state of non-cooperation caused by scarcity

      yes

      This is difficult, because there are incentives to free-ride

      For Hobbes: difficult/impossible
      For libertarians: not necessarily

      we still have the difficulty in restraining rent-seeking coalitions from consuming the surplus created by cooperation.

      For Hobbes: impossible; thus the actual need for leviathan. With Hobbes there is no “rule of law” or politics because it would be a ruling class.

      For Libertarians: impossible; same reasoning

      NOTE:

      (1) Scarcity=modest scarcity. I would never argue the feasibility of a “libertarian principle” under conditions of “extreme scarcity.”

      (2) The Gauthier model is essentially “tit-for-tat” among a population of constrained maximum reciprocators. Can work under a rational choice model(maximizing payoffs). Could have problems under a biology model(evolutionary game theory, maximizing “fitness”).

  4. So if it’s Hobbes or not, we get to the same problem. We can’t restraint rent-seeking coalitions.

    yes.

    Although I think a Georgist State, that is, one where “public goods” are financed ONLY via ground rents(or land tax), is a possible resolution. But it’s the only possible one(vis a vis “the State”).

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