by Michael S. Rozeff: The
Public’s Demand for Force
on to something essential when he wrote “When we call a capitalist
society a consumers’ democracy we mean that the power to dispose
of the means of production, which belongs to the entrepreneurs and
capitalists, can only be acquired by means of the consumers’ ballot,
held daily in the marketplace.”
The late William
H. Peterson, with whom I had the good fortune to communicate,
expanded upon this idea in a number of articles.
But this idea
of market democracy or consumers’ democracy or dollar democracy
is still too limited. It needs to be taken out of the economic realm
and into the social-political-legal realm. To do that, we need only
extract the essence of the concept. The underlying feature of market
democracy is that each person makes his or her own choices of goods
daily, and this is a “check and balance” on what entrepreneurs produce
and capital markets fund to be produced. Then we need to consider
that there are goods associated with social-political-legal systems.
I purposely do not say what these might be because personal democracy
views them as objects of choice that can vary among individuals.
But one might think of them as arrangements having to do with rules,
laws, and adjudication covering a range of interpersonal behaviors,
or one might also think of them as involving specific goods having
to do with such matters as security, protection, and defense.
Now think of
extending this kind of personal choice into the personal choice
of legal system, social system and governance system. Imagine a
personal power to choose one’s operating systems in the realm of
social-political-legal system. Such a power is the ultimate political
check and balance, orders of magnitude more effective than the machinery
of government arranged by the Framers, which we know today to be
If each person
has the right to enter and leave a social-political-legal system,
then a system that is not satisfying its clients or subscribers
will lose them. One that satisfies its clients will retain them
and possibly attract more. Power and territorial limits will stop
being the criteria by which the people supplying the services of
a system gain and number its adherents. Instead, the individual
decisions of each person will contribute to shaping the observed
systems that result. Each person will have social-political-legal
systems from which to choose.
is constrained by the terms appropriate to today’s monopolistic
governments. Using that limited vocabulary, the closest we can come
to the right to enter and leave a social-political-legal system
of living with others is the term “personal secession”. Monopolistic
states typically take a firm stance against subdividing into smaller
political units, resulting in civil wars, but there are conditions
and circumstances where such break-ups occur peacefully. The world
has formally and informally recognized in some ways the right of
a people to secede under certain conditions that the states impose.
The idea of
personal secession goes much further. It goes as far as the concept
of secession can possibly go. It acknowledges the right of each
and every person to select a society, a system of law, and a political
arrangement individually and not necessarily by being in a collective
known as a “people”, although that is always a possibility.
can be defined by rewriting what Mises wrote. “When we call a society
a personal democracy we mean that the power to supply legal, social
and political systems, which belong to the entrepreneurs and capitalists,
can only be acquired by means of the free personal choice of clients
or subscribers, made at agreed-upon intervals.”
motivation for once again expressing this panarchy idea, this time
in a different way that connects it with past ideas, is the stiff
laws against terrorism passed by governments in America. These are
being imposed on everyone, and they appear to be draconian, costly,
senseless, cruel and discriminatory.
laws are a sample — one instance — of the typical process by which
elected representatives make and impose laws. A citizen has a right
to speak out on issues and another right to vote or not vote on
a series of candidates. A citizen has a right to run for office.
A citizen has a right to move to another state or country. These
are all not insignificant rights, won over the centuries. These
comprise a portion of what is today meant by democracy. But they
are far, far from personal democracy.
Again, we are
constrained in our thought by the vocabulary. Today’s democracy
is a qualified democracy. Let us call it “state democracy”. It is
a democracy entirely linked to and emanating from the concept of
a single state as the sole sovereign political unit. All the rights
just mentioned have to do with the “citizen” of a state and a political
system equated with that state and its machinery. A citizen is not
a person with free choice of a social-political-legal system. A
citizen is a designation of a state-limited and state-defined set
of rights that each person finds he has, whether he likes it or
All the fancy
speeches about freedom, democracy and spreading democracy throughout
the world and all the high-toned rhetoric about the superiority
of the American system are talking about state democracy.
It is a conceptual error to equate state democracy with democracy.
To see this, we need only note that state democracy is the polar
opposite of personal democracy. State democracy is a monopoly imposed
within territorial bounds by numbering persons as citizens and allowing
no or very limited choice of social-political-legal system. It is
democracy through individual voting and some rules about determining
voting outcomes that each person takes as given by and large. Personal
democracy is defined by a right of each person to choose a social-political-legal
system without territorial bounds. Again there is individual choice
but it is not constrained to a vote within a political system or
to the other rights that come with state democracy. The choice is
a decision to participate and join, and it may involve spending
resources and accepting obligations voluntarily. The only common
element in these two democracy concepts is that of individual choice.
In state democracy, that choice is highly constrained and within
bounds that lie beyond individual choice. In personal democracy,
the choice is much wider, like that one has in free markets.
The shape and
content of the resulting social landscape, political landscape and
legal landscape are results of each person’s acting as a client
or subscriber or buyer or demander, as in a market. These are neither
pre-determined nor imposed as in a state democracy. No system of
political voting is imposed. No constitution is imposed. No borders
are imposed. No citizenship is imposed. A person chooses to join
or not join, and that is the essential in personal democracy.
If a set of
people wished to live under laws that imposed 50-year sentences
for shooting bullets into a car, they could do that with personal
democracy. They would have to live with the costs and benefits of
such laws. They would not be imposing them on their non-subscribers.
By the same token, if a set of people wished to live under laws
that required restoration of damaged property as the result of such
actions, they could do that, and they too would have to live with
the costs and benefits of such laws.
being what they are and with the right to subscribe and unsubscribe
from a system, there will be competition among systems. There will
be checks and balances arising from personal democracy. There will
be trials and errors. There will be mistakes. But if people can
subscribe and unsubscribe, they can benefit from the competition
is based on the principle of state sovereignty. The state’s power
prevails. The citizens as a group and linked by particular political
arrangements are associated with this sovereignty. Whatever the
basis of this sovereignty is, nothing can stand in its way when
a law or rule is formulated, passed and enforced. There is no check
and balance from outside the system. One can only exercise the limited
rights of protest, voting, moving and running for office that the
state allows. State democracy is a limited democracy. It is a monopolistic
for individuals living in state democracy is to gain control over
the machinery of government and to use it to one’s personal advantage
by forming coalitions that pass laws that one wants. This in a nutshell
is the history of American government and of all similar state democracies
and it is the reason why their defects become worse and worse over
time generally, until they perhaps experience some catastrophe and
people start out fresh.
democracy opens up the closed system that is state democracy. The
incentive is for each person to choose what he or she regards as
good. There is no means of capturing a government to the mass detriment
of subscribers. They will simply unsubscribe.
or systems that produce happiness are unknown. Some elements may
remain the same. Others change. Human life and happiness has not
reached a culmination or finality in today’s system of state democracies.
The time is coming when we will jettison state democracy with all
of its glaring defects. We will be looking for alternatives that
are better. Resurrecting the monopoly state democracy with a new
constitution is one alternative. But why bother? The result could
only be a mish-mash of compromises satisfying no one and placing
a strait jacket on everyone.
is the goal we should bear in mind and for which we should strive.
S. Rozeff [send him mail]
is a retired Professor of Finance living in East Amherst, New York.
He is the author of the free e-book Essays
on American Empire: Liberty vs. Domination and the free e-book
The U.S. Constitution
and Money: Corruption and Decline.
© 2013 by LewRockwell.com. Permission to reprint in whole or in
part is gladly granted, provided full credit is given.
Republished with permission from:: Lew Rockwell