President Milei mentions Walter Block as a prominent anarcho-capitalist:
“An interview with Javier Milei,” The Economist.

The newly elected president of Argentina, Javier Milei, describes himself as an “anarcho-capitalist Austrian economist, and libertarian.” Since no person thus identified has ever been elected to the presidency of a major nation anywhere before, the ordinary reader may not be familiar with these terms. We shall outline the meaning of these terms, because knowing how a person sees himself provides a guide to that person’s future actions.

First, “anarcho-capitalism” describes an ideal society, an “anarchy”, which means no government, and “capitalist”, which means that all property, be it land, factories, homes, etc. is owned by individuals. Thus, an anarcho-capitalist would aim to reduce the size of government to zero: privatize everything! And “everything” means exactly that. Not only should large factories, steel mills, railroads and airlines, if currently owned by government, be privatized, but the court system, the police, and the military should also be organizations that are privately owned. Thus on the campaign trail Milei has waved a chain saw to show that he intends to cut government as much as he can. He has announced that he intends to abolish the Argentine central bank and replace the Argentine peso with the US dollar. Milei’s goal is to allow the Argentine people to choose which currency they would prefer to use, and in the present environment, the US dollar is the globally preferred choice. Shutting down the central bank will simply prevent any further printing of pesos, and further inflation of prices. If some Argentines would still prefer to use the peso, they would have that choice. In an anarcho-capitalist society, no decision is forced on any individual by government.

An alternative term for such a society is “libertarian.” In the nineteenth century English speaking world, the term would be “liberal,” meaning “free,: but in modern English, the word “liberal” has become to mean “socialist,” which means that government makes most of the decisions, not individuals. In modern Spanish, the word “liberal” has retained its original meaning so Milei, speaking Spanish, calls himself a “liberal.” Thus the proper translation into English is ‘libertarian.”

The term “anarcho-capitalism” was introduced by “Mr. Libertarian,” the Austrian economist Murray Rothbard, who noted that there were only three ways of organizing a human society. First, two people could cooperate by agreeing to help each other achieve each other’s disparate goals. This is the standard free market type of organization. You sell your labor or product for money, which you then use to purchase goods which are your goals.

The second way of organizing society is by persuading another that your goal is also that person’s goal. An example would be someone contributing money to a college or church because that person wishes to enable a professor to advance human knowledge or spread the contributor’s religion.

The third way is to impose cooperation by force: you help me achieve my goal, or I’ll kill you. This is the only reason governments exist: to impose goals on the population that they would not otherwise pursue. The goals are those of the government leaders, not those of the individuals comprising the society.

These are the only methods of organizing a society, and a libertarian anarcho-capitalist holds that the third method of social organization is evil.

The anarcho-capitalist also points out that force is an inefficient method of organizing a society, because by imposing the same goal on others, one by definition does not take into account the knowledge in the individuals whose different knowledge led them to pursue goals other than those desired by the government leaders. Since the knowledge possessed by others who wish to pursue their own goals, and the knowledge of more efficient methods of production than the opinions of the leaders is suppressed by force, the society is necessarily poorer.

Argentina has been impoverished by the Peronist government which in various forms has ruled the country for more than seventy years. The libertarian philosopher Hans Hoppe has pointed out that any act of knowledge generation involving more than a single person necessarily requires persuasion rather than force. Only the free interchange of ideas of both be integrated. “Accept my theory or I’ll kill you” does not allow the testing of a theory. It only tests whether the one threatened is willing to die for his theory.

Which bring us to the third unfamiliar concept, “Austrian economics,” an approach to economics that originated in Vienna at the end of the nineteenth century. It has nothing to do with the economy of that particular European country. Rather, it stems from the fact that its first practitioners – Menger, Bohm-Bawerk, Mises, Hayek, Schumpeter – all practiced there. The Austrian School holds that the way to understand how an economy is organized is to realize that an economy, like all forms of human social organization, is based on a very few universal human motivations, which serve as postulates. The main postulate is humans act to try to maximize their “self-interest.” Now “self-interest” as Austrian economists use it, is often misunderstood to mean “selfishness.” But Mother Teresa, ministering to the poorest in the slums of Calcutta, was following her self-interest in the Austrian sense, since she chose her own goals and pursued them. Mother Teresa believed she was following the orders of God to help the poor. Following God’s orders was the self-selected goal of Mother Teresa. Mainstream economics attempts to understand economic phenomena by applying statistics to these phenomena. This sounds good until one realizes that the “statistics” are based on regarding “probability” as a frequency, an identification that has largely been abandoned by physical scientists and mathematicians in favor of Bayesian probability theory. So mainstream economics, in its attempt to copy physics, has ended up exhibiting physics-envy, to no avail.

Austrians also diverge from mainstream economists in several other ways: they reject Keynesian economics, both the left wing fiscalist version and the right wing monetarist variety. Praxeologists maintain that there are necessary truths in economics for which econometric testing is irrelevant; for example, the minimum wage law necessarily creates unemployment for unskilled workers. They favor the gold standard; are highly suspicious of the supposed beneficial effects of compulsory egalitarianism, are dubious regarding anti-trust regulations.

Milei is the most moral and knowledgeable president to ever take office anywhere. The obstacles he faces in his attempt to minimize government in Argentina are enormous. Argentine government officials, who are paid lavish salaries to impose their own misbegotten socialist theories by force, will resist being fired from their jobs. Argentina owes the IMF some 45 billion dollars, and the IMF is expected to use the debt to restrict Milei’s efforts to return power to the people.

We wish Milei luck. If he succeeds, Argentina will be an example for all nations.

But is not anarchism merely a pipe dream? Is it not the stuff of bomb throwers and misfits? Yes and no. Left wing anarchists, it must be allowed, pretty much fit this bill. But they are the very opposite, in this regard, of Mileiian anarcho-capitalists.

Then there is the case of Somalia. No clear government runs the entire country, so its society is anarchistic. Yes, its GDP compared to the U.S., Canada, England, France, Germany or any of the Scandinavian nations is nothing to write home about. However, when contrasted with its neighbors, it is doing quite well, thank you very much, better than before under statist rule.

There is also the fact that a state of anarchy now exists between all nations. The relationship of Albania and Argentina is one of anarchy; no central government rules over the two of them. The same situation prevails between Bulgaria and Brazil, between China and Chile between Denmark and Djibouti, between Ecuador and Egypt, etc. Indeed, this is the precise relationship between all of the countries in the world with each other. zxzx

Presumably, the reason for the government of any one country is that two of its citizens might “get into it” with each other, and they need this organization to maintain order between them. Yet, if that is true, then the same precise relationship exists between any two nations. Thus, we need a world government to keep the piece. Yet, very few people will completely follow through on the logic of this example and call for a world government. If we had one, and it was even slightly democratic, then India and China between them would pretty much run the planet. Very few favor this state of affairs. Thus, they favor anarchy between nations, the very system Javier Milei it now trying to introduce in Argentina.

Will Mr. Milei be able to in one fell swoop convert his native land to this system? No, of course not. Most people there are not ready for any such full-blooded system. But he will certainly move that great nation in the direction of free enterprise and private property. Honest profits, hopefully, will no longer be a term of derision. Rather, Adam Smith’s “invisible hand” will come to take pride of place. Argentinians, hold onto your hats. You will be soon introduced to a system of freedom, and it will be liberating, exhilarating!

Frank Tipler, is a member of the Mathematics Department, Tulane University, New Orleans [email protected]

Walter E. Block, Ph.D. is Harold E. Wirth Eminent Scholar Endowed Chair and Professor of Economics at Loyola University New Orleans [email protected]