Objective Law as the Rule of Law

The government in a capitalist system embodies the rule of law, not the rule
of men. This means that the government must operate in accordance with
objective laws.

Objective laws, as philosopher Harry Binswanger explains, “must be objective

in both their derivation and their form.” To be objective, a law must be based
on the recognition and protection of individual rights. It must be strictly
limited to the prohibition of the initiation of physical force in some defined
form. Because individual rights are the only means for a society to recognize
the objective requirements of man’s survival as a moral being, they are the
only proper basis for a system of laws to regulate that behavior in society.

That the form of the law must be objective means that it must be clear,
knowable, and consistent in their language. Citizens must be informed of the
laws, their justification, and the clear, objective punishments that accrue for
violations prior to taking action. A government cannot rightfully engage in
retroactive lawmaking (a principle enshrined in the Constitution’s “ex post
facto” clause).

The contrast to a non-objective law illustrates the difference between a rule

of law and the rule of men. In a proper, objective system, a government
would clearly define and prohibit murder. A non-objective law would be a law
that prohibited “doing things that are mean” to other people. Whereas in the
first example, the individual’s right to life is protected against the initiation of
physical force (gunshots, stabbings, poison, etc.), in the latter example, no
man could know what would be enforced as “mean.” Such a law would waver
according to the judge or jury involved in the case.

Unfortunately, such non-objective laws have come to be commonplace in our

system. The antitrust laws prohibit “unfair” competition, which has been
interpreted by the courts to both prohibit and allow the same types of
business practices depending on the situation. Some legislators want to pass
laws that prohibit gasoline producers from selling at prices that are
“unconscionably excessive.” This is the essence of a non-objective law—it is
not based upon an instance of the initiation of physical force since buyers and
sellers of gasoline come to the market freely of their own choice; and it is not
clear or knowable ahead of time, since “unconscionable” may mean different
things to different juries and judges. In the end, the enforcement of such a
law would exist at the whim of the man or men who held governmental
power. No man would be safe from the arbitrary exercise of the government’s
power in such a situation—it would truly be the rule of men.
http://www.clemson.edu/capitalism/capres/objectivelaw.html

CAPITALISM & COMMERCE

  
THE PURPOSE OF LAW
AND CONSTITUTIONS
 
by Edward W. Younkins
   
  
          The rule of law requires that people should be governed by accepted rules,
rather than by the arbitrary decisions of rulers. These rules should be general
and abstract, known and certain, and apply equally to all individuals.   
   
          Constitutional governments are based on a previous commitment to
freedom under the rule of law. The essential attribute of constitutionalism is a
legal limitation on government. Under constitutionalism, rulers are not above the
law, government power is divided with laws enacted by one body and
administered by another, and an independent judiciary exists to ensure laws are
administered objectively. An efficient and effective constitution allows
government tofunction to protect the lives and liberties of citizens without
violating the rights of some to provide gains to others.

 
          Non-statist customary and privately produced laws continue to exist today.
Members of many voluntary associations prefer to operate under rules of their own
choice and making rather than relying on those of a coercive government.   
   
Natural Law  
   
          Conventionalists maintain that law and justice are merely man-made
conventions and that no action can be deemed to be right or wrong unless a
particular populace, through its customs or positive laws, declares that it is right or
wrong. Positivists espouse relativism and subjectivism with respect to what is proper
or improper.  
   
          Natural law opposes the idea that moral law is relative, subjective, and
changeable. Natural law provides a criterion by which positive laws can be judged. If
the law of the state runs counter to natural law, it is held to be unjust. Positive law
and normative justice are not synonymous. If justice is pertinent then natural law is
pertinent.  
   
          Natural law derives from the nature of man and the world. It is discoverable
through the use of reason in accord with nature, eternal and unchangeable, and
applicable to all persons. Natural law theory supports universally shared moral
principles and norms that raise man above relativism and subjectivism.   
   
          Since natural law can be derived from what is inherent in human nature, it
would be valid even if God did not exist. Thomas Aquinas has explained that there
exists a system of moral beliefs accessible to human reason and independent of
divine revelation. Man has a particular nature involving specific natural needs and
the ability to use reason to recognize what is good for man in accordance with those
needs.  
   
          Although natural law is essential to Christianity, Christianity is not essential to
natural law. Natural law is in agreement with God's will, not because of divine
revelation, but because the nature of man and the world mirror God's will. A person
does not have to be a Christian to understand the conditions and framework of
human existence and social life, although believers in the Divine will avow that the
conditions and framework are of God's creation. In creating each existent, God
implanted the law of its nature within it. The law of nature, as dictated by God, is
superior in obligation to all other laws. To believe in the natural law is to believe that
there are moral standards that transcend the customs, practices, and laws of any
given community. Positive law can be viewed as the system of rules created by
humans in their attempts to put natural law into practice.   
   
The Rule of Law  
   
          Law is the activity of subjecting human behavior to the governance of rules.
The rule of law is concerned with regulating the use of power. Whereas society is a
spontaneous order, the state is a protective agent with the monopoly role of
enforcing the rules of the game. Since the monopoly on coercion belongs to the
government, it is imperative that this power not be misused. Under the rule of law,
everyone is bound by rules, including the government.  
   
          As explained by Hayek in his various works, the rule of law requires law to be:
1) general and abstract, 2) known and certain, and 3) equally applicable to all
people. The rule of law also necessitates independent judges unmotivated by
political considerations and protection of a private domain of action and property.   
   
          In a free society each person has a recognized private sphere, a protected
realm which government authority cannot encroach upon. The purpose of law is to
preserve freedom and moral agency.  
   
          The rule of law is a meta-legal principle. Similar to natural law theory, it
provides a benchmark against which laws can be evaluated. From this perspective,
law is about the discovery of the rules of just conduct. For example, the history of
common law has been one of attempting to discover general rules that will foster a
smoothly functioning social order. There is a large amount of natural law precedent
embodied in the common law.  
  
    
     « In a free society each person has a
recognized private sphere, a protected realm
which government authority cannot encroach
upon. The purpose of law is to preserve
freedom and moral agency. »  
 

   
          The rule of law ensures that judges decide disputes in terms of existing
known and general rules and not according to the perceived desirability of particular
outcomes. The purpose of the judge is to maintain an order, not to attain some
specific result or direct society's resources to particular persons or uses. His
function is to ascertain, articulate, and refine the rules of justice that will permit the
preservation of the social order. A judge is not to issue edicts – he is only to rule
when a dispute is brought to him. Once law has drawn the boundaries of individual
discretion, courts should not second guess individual use of that discretion. Judges
should carry out the law – not change the law.  
   
          Distributive (i.e., social) justice is irreconcilable with the rule of law. The rule
of law only establishes the rules for the social game. These rules of just conduct are
applicable to an, as yet, unknown and indeterminate number of persons, cases, and
instances. These rules have no reference to particular persons, places, or objects.
In short, such laws do not try to designate who will be winners or losers or what the
society that emerges from these rules will look like.  
   
          Hayek has distinguished between two different kinds of laws. The first
involves man's attempts to discover and express clearly what the general rules of
justice really are. Here the law is essentially discovered, not made. These laws
apply to all, including the leaders. Power should be divided with laws made by one
body and administered by another. Also, an independent judiciary is required to
make certain that laws are administered fairly. Those who administer the law should
have little or no discretion. The second type of law involves rules dealing with the
internal operation of the organization. These administrative measures are devised to
run the internal operations of the government. Essentially, these commands tell civil
servants how to carry out their duties regarding the running of the bureaucratic
public sector.  
   
          There has been a tendency for the law-finding function of the government to
be confused with its administrative functions. A great deal of what we think of as law
today is really administrative legislation meant to direct the internal operations of the
government, rather than to preserve justice. In other words, the organizational rules
of authorities are mistakenly given the same status as general rules of justice.   
   
          As the distinction between administrative commands and rules of justice
became blurred, the restraints on government power have weakened. This led to
the false impression that our elected officials possess and should possess as much
power in deciding the rules of justice as it has in the formulation and execution of
administrative proposals. It is no wonder that many of our elected officials think they
are « running the country ».  
   
          Hayek saw the problem as stemming from the fact that the power of
conducting the government and the power of discovering the rules of just conduct
are combined in the same representative bodies. As a result, over the years,
legislation has increasingly included directives commanding people how to act with
the goal of attaining specific outcomes. During the last half century, the rule of law
has been displaced with what has been termed « social justice ».  
   
          In addition, the rule of law is further weakened when legislative and judicial
power is delegated to unelected government bureaucrats. Starting in the 1930s,
Congress began passing general laws, leaving the details up to administrative
agencies. These agencies enforce and interpret their own rules and regulations
which, although they have the force of law, have not been ratified by the
Constitutional lawmaking authority.   
   
Pluralism and Constitutionalism  
   
          Pluralism and constitutionalism share a skepticism toward the concentration
of power. Whereas power is the force by which one can compel others to obey,
authority is the right to direct and command (i.e., to be obeyed). Authority requests
and requires power. Authority is restricted to assigned areas. Given the corruptible
nature of human beings, there is a tendency for power to overflow its bounds. Power
exercised without authority is a threat to freedom.   
   
          Authority would be necessary even if society solely consisted of saints and
wise men. Authority is necessary to ensure unity of action within an organization.
Legitimate activities call authority into being. It is the creation of a position or an
office, not one's appointment to it, that represents the authentic investiture of
authority. Authority goes with an office, is impersonal, and is essentially independent
of the person who exercises it.  
   
          Power is an instrument of control. It is exercised legitimately when it is
employed to discharge effectively the functions of the office. If power exceeds the
means appropriate to these functions, it becomes illegitimate.   
   
          Pluralism, both the cause and effect of freedom, involves multiplicity,
diversity, and often times, conflict. Pluralism requires tolerance, voluntarism, and a
combination of individualism and voluntary associationism. The aim of pluralism is a
wide diffusion of power. Its structure is the voluntary groups working between the
national government and individual citizens. When power is diffused into many
bodies, imbalances of power are prevented and the individual is protected from the
tyranny of the one, the few, or the many.  
   
          Pluralism is concerned with the distribution of authority and functions among
the various sectors of society (i.e., the economic, political, and moral-cultural
sectors) and among the various types of groupings within each of these sectors. A
free society favors processes and devices that disperse decision-making power,
thus enhancing the possibility for the use of individual freedom.   
   
The advent of pluralism  
   
          It was not until the medieval period, well after the fall of the Roman Empire,
that circumstances favorable for pluralism were present. This was a time when
authority was challenged and threatened (e.g., church and state, pope and emperor,
emperor and king, king and baron, lord and vassal, etc.).   
   
          Only when men were forced to create new associations to perform functions
once carried out by a powerful central authority did pluralism come into existence.
Pluralism thus fostered individual freedom, responsibility, and creativity and
encouraged the development and growth of new forms of association to meet
human needs.  
   
          Constitutional governments are distinguished by specific restraints which try
to ensure that power is not abused. By dividing power, a constitution provides a
system of restraints upon government action. A constitution is a set of fixed written
rules that limits the exercise of political power. The systematic use of written
constitutions as fundamental and paramount law, enforceable in courts on behalf of
citizens whose rights were encroached upon by these rulers, did not emerge until
the end of the 18th century.  
   
          The impetus behind constitutional government was a desire for justice and
the idea underlying restraints is of a higher natural law limiting the operations of the
state. As an instrument, the Constitution is a grant of powers. The doctrine of
enumerated powers, the cornerstone of the Constitution, held that the government
had only those powers that the people have given it. It follows that the Constitution
can also be viewed as a symbol of the reserved rights of the people. The belief that
the legitimate governmental authority originates with the people is derived from the
American political theory of the consent of the government.   
   
          Constitutional arrangements for protection of individual liberty presume a prior
commitment to liberty under the Rule of Law. These American political traditions
presuppose certain convictions about human nature. Since men are not angels,
and  since men are to govern other men, controls on the government are necessary.
The idea of constitutional government also recognizes the natural rights of
individuals and the moral responsibility of each citizen as a person. The American
Constitution is thus designed to maximize each individual's equal right to pursue his
own peaceful goals and experience the benefits and responsibilities of private
ownership.  
   
          The American constitutional political system is based on a territorial
distribution of power, the distribution of power among agencies with functionally
differentiated realms of authority, a chronological distribution of power through
periodic and frequent elections, and a written constitution enforceable by courts.
With respect to the territorial distribution of power, portions of power are vested in
state governments as opposed to the national government. Also, both national and
state governments are populated by representatives of people from various
geographical locations. Functionally, the constitution proposes that there are
different types of governmental powers and that these powers should not be
concentrated in just one body of government officials. The American solution has
been to separate them into three kinds of power: executive, legislative, and judicial.
Laws should be made by one body and administered by another. An independent
judiciary is necessary to make sure the laws are administered fairly and objectively.
In addition, pluralism provides a functional distribution of authority and additional
restraints on power by maintaining many voluntary power centers throughout
society. The chronological distribution of power places limits on the tenure of
office.  
    
          In addition, the party system, the free press, and voluntary associations aid in
holding government officials accountable. Politicians are kept responsible, not only
through periodic elections, but through constant publicity of their actions and
discussions and through citizens' rights to associate together and to petition the
government. The eternal vigilance of the people is an important check on the power
of the government.  
  
This article was published in the Summer 1994 issue of Formulations  by the Free Nation Foundation

The Nature of Law 

Part II: The Three Functions of Law

by Roderick T. Long

Part II: The Three Functions of Law

Why Three Functions?

The purpose of a legal system is to provide a systematic, orderly, and predictable

mechanism for resolving disagreements. In order to do its job, any such system must
perform three closely connected, but nevertheless distinct, functions: adjudication,
legislation, and execution.

The judicial function is the core of any legal system. In its judicial function, a legal
system adjudicates disputes, issuing a decision as to how the disagreement should be
settled. The other two functions are merely adjuncts to this central function.

The purpose of the legislative function is to determine the rules that will govern the
process of adjudication. Legislation tells judicial function how to adjudicate. The
legislative process may be distinct from the judicial process, as when the Congress
passes laws and the Supreme Court then applies them; or the two processes may
coincide, as when a common-law body of legislation arises through a series of judicial
precedents.

Finally, the purpose of the executive function is to ensure, first, that the disputing

parties submit to adjudication in the first place, and second, that they actually comply
with the settlement eventually reached through the judicial process. In its executive
function the legal system may rely on coercive force, voluntary social sanctions, or
some combination of the two. The executive function gives a legal system its "teeth,"
providing incentives for peaceful behavior; both domestic law enforcement and
national defense fall under the executive function. 
 
Should Law Be Monopolized?

With regard to these various functions, there are three primary ways in which a legal
system may be constituted:

• Absolutism: The three functions of law are concentrated in the hands of a single
group of decision-makers. 
• Constitutionalism: The three functions of law are monopolized by a single agency,
but distributed among distinct groups of decision-makers within that agency. 
• Anarchism: The three functions of law are not monopolized.

Various combinations of these are possible, since there are legal systems under which
some functions are monopolised while others are not. For example, in the Icelandic
Free Commonwealth, the legislative function was monopolized by the All-Thing
(althingi), or General Assembly; the judicial function was shared between the Thing
courts and the private sector; and the executive function was privatized entirely. [For
more information on the Icelandic system, see my "Virtual Cantons: A New Path to
Freedom?" (Formulations Vol. I, No. 1), "The Decline and Fall of Private Law in
Iceland" (last issue), and Wayne Dawson's review of David Friedman's   The
Machinery of Freedom (this issue).] This is why the legal system of the Icelandic Free
Commonwealth cannot easily be classified either as a pure government or as a pure
anarchy.

Most of us have been taught to regard Constitutionalism as the best of the three
options. Concentrating the three functions in a single agency avoids the chaos
allegedly endemic to Anarchism; while assigning the three functions to distinct sub-
agencies within the monopoly agency allows the three branches (legislative,
executive, and judicial) to serve as checks on one another's excesses, thus avoiding the
potential for abuse and tyranny inherent in Absolutism. This is the "separation of
powers" doctrine built into the U. S. Constitution.

In practice, however, Constitutionalism has proved only marginally better than

Absolutism, because there has been sufficient convergence of interests among the
three branches that, despite occasional squabbles over details, each branch has been
complicit with the others in expanding the power of the central government.
Separation of powers, like federalism and elective democracy,
merely simulatesmarket competition, within a fundamentally monopolistic context. 
 

Locke's Case for Monocentric Law

In his libertarian classic Two Treatises of Government, the 17th-century English
philosopher John Locke offered one of the most famous cases ever made for the
monopolization of the three functions of government. Locke believes that all human
beings are naturally equal, so that in their natural state each person has as much right
as any other to exercise the various functions of law:

"Man, being born, as has been proved, with a title to perfect freedom and an
uncontrolled enjoyment of all the rights and privileges of the Law of Nature,
equally with any other man, or number of men in the world, hath by nature a
power not only to preserve his property — that is, his life, liberty, and estate,
against the injuries and attempts of other men, but to judge of and punish the
breaches of that 
law in others, as he is persuaded the offence deserves .... each being, where
there is no other, judge for himself and executioner ...."

(II. vii. 87.)

This egalitarian distribution of political authority, Locke argues, is required by

justice unless individuals voluntarily relinquish their authority to a
government. However, Locke thinks that people living in a state of anarchy will find it
rational to set up a government in order to gain greater security:
"If man in the State of Nature be so free as has been said, if he be absolute lord
of his own person and possessions, equal to the greatest and subject to nobody,
why will he part with his freedom, this empire, and subject himself to the
dominion and control of an other power? To which it is obvious to answer, that
though in the State of Nature he hath such a right, yet the enjoyment of it is
very uncertain and constantly exposed to the invasion of others; for all being
kings as much as he, every man his equal, and the greater part no strict
observers of equity and justice, the enjoyment of the property he has in this
state is very unsafe, very insecure. This makes him willing to quit this
condition which, however free, is full of fears and continual dangers; and it is
not without reason that he seeks out and is willing to join in society with others
who are already united, or have a mind to unite for the mutual preservation of
their lives, liberties and estates, which I call by the general name — property.
The great and chief end, therefore, of men uniting into commonwealths, and
putting themselves under government, is the preservation of their property; to
which in the State of Nature there are many things wanting." 
(II. ix. 123-124.)

Locke then goes on to list what he sees as the three principal defects of the state of
natural anarchy. Although he does not point this out explicitly, the three defects
appear to correspond to the three functions of law that I have been discussing, and I
have labeled them accordingly:

[The Legislative Defect.] "Firstly, there wants an established, settled, known

law, received and allowed by common consent to be the standard of right and
wrong, and the common measure to decide all controversies between them. For
though the Law of Nature be plain and intelligible to all rational creatures, yet
men, being biased by their interest, as well as ignorant for want of study of it,
are not apt to allow of it as a law binding them in the application of it to their
particular cases.

[The Judicial Defect.] Secondly, in the State of Nature there wants a known
and indifferent judge, with authority to determine all differences according to
the established law. For every one in that state being both judge and
executioner of the Law of Nature, men being partial to themselves, passion and
revenge is very apt to carry them too far, and with too much heat in their own
cases, as well as negligence and unconcernedness, make them too remiss in
other men's.

[The Executive Defect.] Thirdly, in the State of Nature there often wants
power to back and support the sentence when right, and to give it due
execution. They who by any injustice offended will seldom fail where they are
able by force to make good their injustice. Such resistance many times makes
the punishment dangerous, and frequently destructive to those who attempt it." 
(II. ix. 124-126.)

Locke concludes that these three defects may be remedied by centralizing the
legislative, judicial, and executive functions in a constitutional government.

The Lockean Case Against Locke

I think Locke's arguments for a monocentric legal system contain a serious confusion:
the confusion between the absence of government and the absence of law. Locke's
arguments are good arguments for a formal, organized legal system; but Locke
mistakenly assumes that such a system requires a governmental monopoly. The
majority of legal systems throughout history, however, have been polycentric rather
than monocentric. Locke did not have the benefit of our historical knowledge
however; nor, despite his brilliance, was he able to imagine on his own a legal system
that was not a government. The actual history of stateless legal orders shows that they
do not noticeably suffer from any of the three defects Locke lists; on the contrary,
those defects are far more prevalent under governmental law.
Consider first the judicial defect: the worry that, in the absence of common authority,
each individual would have to act as a judge in his or her own case, with all the
problems of bias and partiality that entails. Locke is correct in thinking that submitting
disputes to impartial third-party arbitration is generally preferable to acting as one's
own judge and jury (except, of course, in emergency cases in which one must act
quickly and no such impartial judge is available). But such third-party judges will
always be available, whether or not there is a government. There is a widespread
tendency to suppose that if something is not supplied by the government, it cannot be
supplied at all; I call this "the invisibility of the market." (The problem with invisible
hands is that you need libertarian lenses in order to see them — whereas everyone can
see the visible hand of government.) Polycentric legal systems have always had plenty
of third-party judges, from the relatively formal Moots of early Anglo-Saxon law (in
which disputants were judged by their peers on the basis of local custom) to the
relatively informal arrangements of the American frontier (in which each disputant
would pick an arbiter, the two arbiters together would pick a third, and the judgment
of the three together would be binding). History shows that stateless legal orders tend
to create powerful incentives for people to submit their disputes to arbitration
wherever possible, in order to avoid the appearance of being an aggressor (and thus
the target of defensive coercion oneself). Anarchy does not suffer from Locke's
judicial defect.

But government does. In any dispute between a citizen and the state, the state must by
necessity act as a judge in its own case — since, as a monopoly, it can recognize no
judicial authority but its own. Hence governments by their nature must be subject to
the judicial defect. Constitutionalism is supposed to remedy this defect by separating
the judicial branch from the executive and legislative branches, so as to prevent the
judging agency from being a party to the dispute. But what if the citizen's quarrel is
with the judicial branch itself? In any case, even if the quarrel is solely with the
legislative or executive branch, it would be naive to assume that the judicial branch of
a monopoly will be unsullied by the interests of the other branches. No one with a
complaint against the marketing division of General Motors would be satisfied to have
the case adjudicated by the legal division of General Motors! The solution to the
judicial defect, then, is not a monocentric judiciary, but a polycentric one.

Next, consider the legislative defect: the worry that without government there will be
no generally known and agreed-upon body of law. Why not? We should rather expect
markets to converge on a relatively uniform set of laws for the same reason that they
tend to converge on a single currency: customer demand. The late-mediæval private
system of mercantile law known as the Law Merchant (lex mercatoria), for example,
offered a more unified body of law than did the governmental systems with which it
competed.
This should be no surprise. Why are there no triangular credit cards? The reason is not
government regulation, but rather that — given our current system that relies on
rectangular cards — no one would accept it (unless the government made them accept
it, thus preventing the market drive toward uniformity). Similar reasons explain why
the market no longer carries both VHS and Betamax video cartridges, but only VHS;
the market creates uniformity when customers need it, and diversity when they need
that instead. It's a good thing that video cassettes come with lots of different kinds of
movies, and so the market ensures this; it would be a bad thing if video cassettes came
in fifty different shapes and sizes, and so the market prevents this.

Indeed, it is not polycentric legal systems, but rather monocentric ones, that suffer
from the legislative defect, since a mountain of bureaucratic regulations that no one
can read is in effect equivalent to an absence of generally known law. Under a private
legal system, changes in law occur as a response to customer needs, and so the body
of law is less likely to metastasize to such unwieldy proportions. The solution to the
legislative defect is not to monopolize legislation, but rather to privatize it.

Finally, consider the executive defect: the worry that without government there would
be insufficient power on the part of private individuals to enforce the law. It is true
that under anarchy each individual has the right to exercise the executive function on
his or her own, but it does not follow that law enforcers will in practice be solitary and
unaided. On the contrary, voluntary associations of enforcers typically emerge — as
in the case of the thief-takers' associations of early 19th-century England, or the
vigilance committees of the old American frontier. Hollywood movies have
accustomed us to think of the latter associations as unruly lynch mobs, and have
depicted the frontier as nightmarishly violent; in historical fact, the level of criminal
violence in frontier society was far lower than in our own, and the protective
associations were, for the most part, reliable organizations that gave their defendants
fair trials (at which defendants were often acquitted — not the mark of a kangaroo
court). Indeed, the whole notion of an organized police force is a relatively modern
concept; police were extremely rare throughout ancient, mediæval, and modern
history, until about the mid-19th century. (Indeed, even the notion of a distinct
governmental military is fairly unusual historically; in most societies, both law
enforcement and national defense have been the job of the armed citizenry.)

If there is an executive defect, it applies not to private law but to public law, in which
individuals typically lack the power to withstand the arbitrary caprice of the state.
Against one marauding band one can form one's defensive band; but who can resist
the overwhelming force of an organized government? Let the victims of Warsaw,
Tiananmen, or Waco judge whether the centralization of law enforcement enhanced
the security of their lives, liberties, and estates.
Abuse of power by law enforcers is in fact much easier to keep in check under the
discipline of a competitive market system. The LAPD would have gone bankrupt
overnight after the Rodney King beating if it had been a private security force with
competitors in the same territory; but as matters stood, despite the public outcry, the
LAPD's "clients" had nowhere else to go, and so the LAPD's incentive to reform its
behavior is much weaker.

In short, then, the three defects Locke cites as objections to anarchy are in fact much
more effective objections to government. None of the three functions of government
— executive, legislative, or judicial — should be assigned to an exclusive monopoly.
In the words of F. A. Hayek: "Law is too important a matter to be left in the hands of
government."  
 

For more information about the stateless legal systems described in this installment,
see the bibliographic essays "Polycentric Law" by Tom Bell and "Institutional Bases
of the Spontaneous Order: Surety and Assurance" by Albert Loan, both in Humane
Studies Review, Vol. 7, No. 1, 1991/92, published by the Institute for Humane Studies
at George Mason University, 4084 University Drive, Fairfax VA 22030.