Brad Miller

Outcompeting the State

In True nature of the State on September 9, 2011 at 4:21 pm

A Private Sector Path to Liberty.

What if Entrepreneurs and Capitalist stopped looking at the State as an immovable monolith  and started looking at it as an inefficient competitor begging to have its customers stolen?

The State is the biggest competitor any of us face, whether we are competing as an entrepreneur or as an employee. Every action the State takes is designed to take more of  our  life, liberty and property. They are competing everyday to steal more and more market share away from you the individual and claim it for the Collective.

But what if those who love Liberty and have an entrepreneurial spirit decide to compete directly with the State in the areas where it believes it’s untouchable?

What if private companies and private associations began forming to take market share away from the State in the areas of “Social Insurance” , “Policing” and “Mail Delivery”?

 The State was not always so powerful. In the recent past  private initiatives provided all the needs of the customers in America. There were no  “State services”.

Many who have been born in the last century, I like to call it the Collectivist Century of America, have been taught that private individuals working voluntarily with other private individuals can not provide education, unemployment insurance, or mail delivery to the  current customers of the State. 

The History of America before 1913 tells a different story.  After the Revolutionary War Mutual Aide Societies sprang up across the New Nation. They were voluntary associations where members paid dues and would receive benefits if they were unemployed, sick or unable to work. They were often religious in nature but  not always, they discriminated against who could join, and enforced a code of conduct of its members.  This voluntary discrimination led to thousands of mutual aid societies that cropped up all over the country to serve their members who shared religious beliefs, common heritage or lived in the same area. These societies unlike the Great Welfare State were organized not to just provide physical benefits but also spiritual and intellectual as well. They encouraged their members to achieve success through self-improvement. 

The Mutual Aid Societies were established to temporarily assist their members during times of financial difficulties. The benefits paid out were not only temporary but also accompanied by the advice and education to overcome unforseen difficulties in the future. They helped individuals in the present and also made available instruction to the members how to become more and more self-sufficient.  The Focus of the associations was not the benefit of “Mankind”. They were focused on the improvement and well-being of individual members. The individual paid dues voluntarily, the individual acted responsibly because if he didn’t he was kicked out, and  focused on helping individuals become self-sufficient as soon as possible after benefits start paying out. 

The Free African Society founded in 1787 was typical of this type of society.  It was founded to provide mutual aide to the Free Blacks of the City of Philadelphia.  

“…that a society should be formed, without regard to religious tenets, provided, the persons lived an orderly and sober life, in order to support one another in sickness, and for the benefit of their widows and fatherless children.” Preamble of Free African Society

The FAS had code of conduct for its members and would not pay benefits out to those who caused their own misfortune by impertinent behavior. It helped educate the children of members who’ve died or helped them find apprenticeships. They took care of the widows of deceased members as well. FAS was typical of the Mutual Aide Societies that sprang up voluntarily around the nation. They played a huge role in helping minorities and immigrants assimilate and become successful in the Free Market Society of early America.

These associations were voluntary creations created long before the Welfare State existed. There is no reason why individuals could not choose to form similar associations today. If someone were to venture down this path I would suggest keeping the membership within families and discreet circles of friends. Individuals who wanted to be members would pay  dues or “subscriptions” just like members of the Mutual Aid Societies of the past.  There would be diverse  associations meeting the diverse needs of their members. Each one could decide who gets in and what benefits they pay out. In this way hundreds of thousands of these associations would crop up without the State even knowing it. The more financially free we are the more free we are of the State. This is a great way to compete and win Market Share back from the Collectivists State. This would also be a concrete example to everyone that individuals acting  voluntarily together can take care of themselves. No force is required.

When pundits and politicians deride the “Rugged Individualism” of early America they fail to see what de Tocqueville found when he visited America in the early 1800s.

 “Americans of all ages, all conditions, and all dispositions, constantly form associations. They have not only commercial and manufacturing companies, in which all take part, but associations of a thousand other kinds—religious, moral, serious, futile, extensive, or restricted, enormous or diminutive. The Americans make associations to give entertainments, to found establishments for education, to build inns, to construct churches, to diffuse books, to send missionaries to the antipodes; and in this manner they found hospitals, prisons, and schools. If it be proposed to advance some truth, or to foster some feeling by the encouragement of a great example, they form a society. Wherever, at the head of some new undertaking, you see the government in France, or a man of rank in England, in the United States you will be sure to find an association”. Alexis de Tocqueville Democracy in America Vol. 2

 The poor will always be among us. But the State doesn’t have to be.  In a Free Market Society people have the best opportunity to improve their lot in life and lift themselves out of poverty. The price they have to pay is the same for all; hard work, savings, and personal responsibility. Mutual Aid Societies, like the  Free African Society,  were one way in which individuals who faced temporary set backs were able to continue on their path to prosperity. 

 Why can’t this happen again today? What if someone started up the Free People’s association? This would be a voluntary association with the intent of replacing the welfare state for a voluntary insurance type service. The world around us was built by individuals entering into voluntary exchanges in spite of the growing Sate . The key to expanding freedom today is by expanding this activity of the  Private Sector by stealing Market Share away from the State.

 Those who want to Live Free often  focus exclusively on elimination or limiting of the State . What if more of us instead, focus on increasing the market share of the Private Sector which is the only way of  ultimately achieving our goal of putting the State  out of business?

An “anti-something” movement displays a purely negative attitude. It has no chance whatever to succeed. Its passionate diatribes virtually advertise the program that they attack. People must fight for something that they want to achieve, not simply reject an evil, however bad it may be. They must, without any reservations, endorse the program of the market economy.”  Mises “Anti-Capitalist Mentality

That is why I think its important to have private alternatives to the services the State currently imposes on us. The Voluntarism of early America is an endorsement of the program of the market economy.

If we focus solely on the elimination of the State without adequate focus on the Free Market solutions to replace the services it provides, the millions of the State’s customers will bound together under the banner of collectivismand reinstitute the State with all its taxes  and services.  Free Enterprise is the only way to starve out the Leviathan.

The voluntary associations are only one way we can start competing with the State. As police budgets are cut around the country business’ are increasingly hiring private firms to protect their property. Soon I believe they will start protecting residential property as well.   Private Alarm companies first began to protect businesses and then moved into the residential monitoring.  I believe its only a matter of time before the Private Police companies are formed to defend residential property. Alarm Companies could link to these private police departments instead of the local tax payer funded police department.  Different alarm companies and private police departments would compete and a better more efficient service would result.

The State is always less efficient than the  private sector and that is why it uses Legalized Force to impose its monopoly across different sectors of Society. Direct Competition with the State is difficult because is the only entity to wield legalized force. But  Challenges to the State’s monopoly occurs everyday indirectly as individuals serve their fellow-man within the profit/loss system of the Free Market. By doing so they keep the State from extending its Monopoly further into new areas of Society

Direct competition to the State has occurred in the past. The most famous was short-lived but serves as a hopeful example to others who wish to do the same.

 Lysander Spooner,  a champion of individualism, outcompeted the Postal Service back in 1844. His America Mail Carrier Company was so much more efficient than the Post Office, he forced the State to lower its postage rate to compete with him. The State, backed by endless resources, then lowered the stamp prices so low he was unable to match the reduced rate do to the fact his capital was not unlimited and had been consumed by the relentless legal battle waged against him by the State. Even though he had to shut down because of  the power of the State his challenge is a reminder that the State can be competed with Even for short periods of time. 

 I don’t think the Post Office as we know it will exist in 5 years. Enterprising individuals will step in to fill the customer demand created by the failed State enterprise and they will do it better and more efficiently,  just as Lysander Spooner did in 1844. This will be a market share gain for the private sector.  Spooner believed in self-employment and was a staunch opponent of the State. He  sought a private sector solution to a certain State Monopoly . If more and more individuals embarked on such endeavors the State would be unable to quash them all. The more we do that the more the True Nature of the State will be Reavealed. Once more folks understand that the State uses  threat of force or actual force to accomplish everything it does,  the more the Private Sector will steal market share from the Collectivist State.

I believe that there is too much “We should” or “You should” in this country and not enough “I will”. That being said I am presenting ideas from the past with the hope of changing the future. The State is not omnipotent. In the recent past (pre-1913) it was significantly smaller than it is today. Over the “Collectivist Century of America” it has taken massive amounts of Market Share away from the private Sector.  Our job is to take it back!!!

We can’t regain our Liberty by being “Anti-Something”. Even though our Enemy is the State, we must remind ourselves that as Individuals our greatest Ally is the Free Market System. I believe that State  is not invincible. The State is limited in what it can actually control. Its eyes and hands are those of individual citizens which delivers services to individuals. If Private individuals or groups of individuals provide a superior product than the State provides at a lower cost, even with legalized force, it will not be able to stop the majority from choosing the Free Market Solution. When individuals steal Market Share from the State its dominion diminishes. The more those who love Liberty do that the less the State there will be.

The world around us is built by private individuals voluntarily exchanging. Everything around us has been buil in spite of the State intervention and Monopolisitic activities.  Just think every time you sell your labor to someone who voluntarily purchases it you are in a small way out competing the State. You have chosen not to be its eyes and hands and chosen instead to serve your fellow-man by pursuing your self-interest on the Free Market. You are providing a better service or product to your customer at a lower price than the State could ever do. As long as entrepreneurs and Capitalists are competing with each other to meet the demands of consumer they are preventing the State from increasing its Monopolistic Market Share of Society.

The Quality of your life is determined by the quality of questions you ask yourself. So for those who love Liberty the question is how can we become more free of State control. Another way to phrase this question is to ask ourselves how can we steal market share from the State?

 How can the Private Sector gain market share away from the State? Our Natural Rights to our Life, Liberty and Property depend on the Free Market System. And the only way to save it from the Collectivists is to increase the number of voluntary exchanges between individuals. The key is to figure out a way of replacing the forced transactions of the State with voluntary transactions.  The more we do this the more the State shrinks and the more Liberty we enjoy.

“How cheaply can freedom be bought?-

  That is a question Leonard Read asked in his must read Elements of Libertarian Leadership. And I think it is one of those quality questions that we must all asks ourselves. How much of our time and energy are we willing to expend to be Free? Who out therein America today  has the courage to start up a Mutual Aid Society to compete with the Welfare State or do as Lysander Spooner did and compete directly with the State’s sacred cow, the Post Office? 

In sales the first person you have to convince that your product is the best product, is yourself. With the Freedom Movement it is no different. WE focus on things like the Federal Tax Code or on Nefarious EPA regulations which are terrible. But what if we begin focusing on how to better serve the current customers of the State and begin stealing their Market Share? This starts with the individual seeking  voluntary solutiosn to your current struggles instead of relying on the State. Then developing products and services that others who currently depend on the State would want to purchase. Most of us who love Liberty are competing with the State indirectly, becasue we don’t work for it. I don’t know if that is enough. I believe when more and more folks start risking all to directly compete with various State Monopolies the more Liberty we will enjoy.
  And That’s my Take



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