I wrote the following essay in 1988 in response to the elections. I invent panarchy in it. Of course, some Frenchman invented panarchy in the 19th century but I didn't know that.


The trouble with government is that it does things that I don’t want it to do and it fails to do things that I think it should do. You could make the same statement about government even if we differed wildly about the proper functions of government. You may want it to combat the drug traffic more effectively and I may want it to provide better health care for the elderly. Maybe you object to its spending money on education and I deplore its purchasing of armaments. But we are both dissatisfied.

The government isn’t mine and it isn’t yours. But somehow it is ours. That’s the real problem with government. Everyone knows that the state needs more money to perform services than private industry. Add to the cost of government inefficiency the price of all the programs that you oppose, and you have to admit that government isn’t much of a bargain.

We could both have a responsive and effective government. But before we can get what we want, we have to look at ourselves and at the state without guile and admit a simple truth: We are consumers of government. Of course, we spare no effort in hiding this truth from each other and from ourselves. When you feel charitable and want to give some money to the poor, you try to convince me that “society owes a debt to the underprivileged.” When I start worrying about the Russians and want to buy some missiles, I stir everyone up about the “threat to Western civilization.”

In truth, we merely want to spend other people’s money on our own projects; but if we honestly admit our desires, we’re afraid that those other people will resent and oppose us. We, therefore, create abstract beings like “society” and “civilization,” beings that don’t exit. You exist. I exist. Our money and our desires are real enough. If we can forget our cunning arguments, our ghostly abstractions, and our moralistic pronouncements, we will admit that we selfishly want the state to do our bidding. Once we put away our self-righteousness, we can demand that state put away its self-righteousness and start giving us good service at a fair price like any other self-interested concern.

Politicians have written mountains of consumer protection and anti-monopoly legislation, not one word of which applies to them. They would be the first to explain to us that we can’t expect fair value from a monopoly that has the power to take our money against our will. As consumers, then, we must first demand that government itself competes for our tax dollars.

In the past, we’ve tried to settle our personal differences about the state by voting for the people who control its monopoly. This practice has encouraged otherwise honest politicians to hide our tax burden and exaggerate the benefits of their programs. It has allowed greedy and tyrannical leaders to set us against each other as enemies simply because we wanted different services from the state. Our democracy has created a governmental structure that takes more than 40% of our money and concerns itself with every human activity. Government has become a giant millipede with a foot in every pie, and yet it can not guarantee the protection of life or property: the theoretical justification for its existence.

Let’s destroy government’s monopoly. We can start by splitting it in half so that we can choose between two governments. Call it biarchy: two rulers. Initially, we could give each political party full control of its own government. The Democrats and Republicans would both have their own defense departments, social programs, and Social Security systems. They would then compete for citizens, in particular, tax dollars. The federal court could be left intact to review legislation and adjudicate conflicts between the governments.

Certain technical difficulties such as debt responsibility, property maintenance, and investment service could be quickly solved by apportioning duties on the basis of budget or number or taxpayers. A computer could clear these matters up automatically. But a more fundamental problem would remain: legislation. In order to provide a uniform code of laws, a president and legislature could be elected from the two parties. This organization would be the same as our present congress and president, but it could not tax or spend money. It’s duties would be limited to making laws and appointing the judiciary.

It might be convenient for the two governments to vie for tax dollars by issuing monthly bills much as utility companies do now. Under such a system, the governments would have to give up the habit of hiding taxation through tariffs, corporate taxes, inflation, debt, and other crafty practices. For the first time, the citizen/consumer would be able to compare the real cost of the state with the value of its products. Nothing would prevent the competing governments from taxing the rich at a higher rate or introducing deductions and exemptions. Each organization could set up whatever tax structure it cared to.

I find it hard to believe that anyone with the slightest respect for truth or democracy would not welcome the change. We are constantly told that democracy can not function without an informed electorate, but under the present system, no one has any idea of how much he is actually paying to the government.

While dictators around the world are returning power to private enterprise in order to save the economies that their heavy handed policies have devastated, it is ironic that America continues to drift into totalitarianism. With biarchy, the citizen would understand the costs of programs and their benefits. He would then be able to choose the sort of foreign policy and social programs that he wanted to support. For the first time, the state itself would be subject to those pressures that make private enterprise efficient. No matter what horror either government committed, its competitor would be there to keep us informed and give us an alternative.

The citizen would also have a greater influence on legislation. Let’s say that one government increased its taxes by $1.00 a month expressly to fight drug use. If this policy attracted more taxpayers/customers, the elected congress would be inclined to pass tougher drug laws. If it lost large number of taxpayers, the congress might think about liberalizing drug laws.

In general, biarchy would give people the voice in the political process that democracy only promised them. I’m sure, though, that most people would oppose a two-government system. Here are some possible criticisms:

1. It would be impossible to collect all taxes directly.

Even without withholding procedures and hidden taxes, the individual should be more willing to pay for a government that was literally “of his choice” rather than one that was only putatively so. If some people were still unwilling to pay, they could be put into prisons as they are today. And if the prisons couldn’t hold all the tax evaders, something would be wrong with the taxes, not the people.

2. People would abandon Social Security, leaving the elderly to starve and freeze.

Social Security returns a greater portion of its budget to the people than any other federal program. Nevertheless, it is a pyramid scheme, which is inherently unsound. If you or I tried to pay our old investors with our new investors’ money, we would be quickly tossed into jail. Social Security is not an investment scheme but a scam that has cheated half its participants and will soon be cheating them all.

Political experts tell us that even mentioning problems in Social Security is political suicide. If the people abandoned Social Security when they were given a chance, then we must conclude that democracy is a farce. How else could a program opposed by the people be such a political success? If Americans turned their back on this bipartisan triumph at the first opportunity, they must now have no more control over their government than the lowliest Russian peasant. Could that possibly be true?

3. Speaking of Russians, they would soon conquer us.

America is in a very fortunate position. Our gross national product, which can be a rough indicator of a country’s ability to defend itself, is more than double any other country’s. Either half of America could easily defend the whole, and both halves would be responsible for the defense. The real question is whether we want our politicians to meddle in all the world’s problems or do we ask only to be secure from foreign attack? Maybe we could decide for once.

Biarchy would allow the people to respond to the needs as they saw them. Let’s say that defense spending fell to 25% of its current level and consequently the Soviets stepped up their aggressive activities. Their actions could provoke a response from the American taxpayers. If the Americans were indifferent, Soviet bellicosity might generate responses in other countries. The combined GNPs of West Germany and Japan exceed the Soviet Union’s GNP [We can now be fairly certain that the separate GNPs of West Germany and Japan exceeded the Soviet Union’s]. Maybe those in the direct path of Soviet ambitions are in a better position to assess and pay for measures to thwart them.

4. Social spending would fall the nothing and we would streets full of beggars.

The three great expenses of the Federal government are Social Security, defense spending, and social spending. Politicians have declared Social Security a sacred cow and now debate how much money should go into the other systems. Presumably, the political parties reflect the desires of the people. We can therefore assume that groups of people do favor defense and social spending. What if some people wouldn’t give a penny to the poor? What if others wouldn’t give a penny to the military? Take military spending. Let’s say you collect all the money from the 50% of the people who were willing to pay. Isn’t that better than forcing the other 50% to pay half as much for something they oppose? People could have what they were willing to pay for.

5. A tax cutting war would turn the government into a minimal state, a mere shadow of a government.

This is not a criticism of biarchy but of democracy. If it is true, then our democracy has tyrannously imposed a gigantic government on people against their wills.

In one form or another, fear of the people’s will is at the heart of all criticisms of biarchy. You say, “If the people are allowed to choose, they won’t pay for Pershing missiles or hot breakfast programs or psychological services under Medicare.” You don’t believe in democracy at all; you believe in your own programs for spending other people’s money. You want to be dictator and you actually hate and fear “the people.”

6. The two governments will conspire to keep taxes high so that they can remain inefficient, corrupt and dictatorial.

I can’t answer this attack. Imagine limiting car manufacturers to only Ford and Chevrolet. Prices would rise and quality would fall. The obvious solution is to find a means for allowing third parties to compete for your tax dollar too. Fourth, fifth, sixth, and thirty-eighth parties should be allowed in the market with them. With enough governments, even those who favor totalitarianism could be satisfied. If you were desperately concerned with Andorran independence, and if neither existing government provided any aid, you could form your own government with the express purpose of helping the Andorrans. Your one-issue state could subcontract the rest of its services from one or both of the existing governments.

Biarchy could be the first step in the evolution of government into an efficient and responsive organization. Competition could seep down to state and local levels, but such a multiplication of governments would be bewildering. More likely forty or fifty competing governments could take care of all federal and state functions while the rather artificial state governments faded away. If it proved impossible to extend biarchy to the local level, the competing states could franchise themselves and compete to take over local functions. Municipalities could decide every year or two which government they wanted. Government for profit could ultimately reach the sublocal levels so that one neighborhood might choose government A, while the people across the street hired government B. Even if citizens had to tolerate a monopolistic government on the local level, they need not be subject to the attendant corruption and inefficiency. They could choose from as many different government as there are channels on their cable TVs.

If Americans chose biarchy, they would become a light to the world. The benefits of biarchy would be even greater in less democratic countries than ours. For millennia people have built bigger and bigger political units with avowed purpose of guaranteeing peace. The result has been perpetual war. Even when a huge government has secured the peace for a while, it did not protect its people from a danger greater than war: the state itself. Mankind’s recent dream has been the creation of a supergovernment like the League of Nations or the United Nations. If some such organization were given enough power to prevent war, who would protect us from the supergovernment itself? Remember that many times more people have been murdered by their own governments than by all the world’s wars combined. If a supergovernment had the power, we would likely see mass murder and genocide on a level as yet undreamed of.

We can only end political conflict by pulling the state’s teeth. War is fueled by the fear of the monopolistic state. Look at South Africa, Northern Ireland, and Israel. The people of these countries are intransigent because they fear that a population with alien values will take over their governments, steal their property, and maybe even murder them. But if separate governments compete for Northern Ireland’s tax dollars, who would fear and hate his government? Why would anyone fight when he could simply choose the state he wanted?

The most extreme forms of socialism and capitalism could co-exist on the same block. If this seems impossible, consider religion. When the Catholic religion had a monopoly in Europe, any deviation was attacked violently. Protestants waged wars to establish their own monopolies while Jews and others had suffer whatever was meted out to them. Eventually the American experience led to the rejection of a monopolistic religion, and today Catholics, atheists, Protestants, Jews, cultists, Moslems, and others live harmoniously in the same cities, in the same buildings. Such a peaceful outcome is possible in the political world too, but only after we abandon the dangerous idea of a monopolistic government.