Judges also make bad calls sometimes. We know this because there is a judicial form of instant replay: the appeals process, including review by the U.S. Supreme Court. Occasionally, even the politically diverse Court clearly indicates to a lower court, through a unanimous decision, that the judge(s) blew a legal call.

Umpire Jim Joyce’s blown call cost Detroit Tigers pitcher Armando Galarraga the 21st perfect game in major league baseball history. After watching the televised replay, Joyce immediately (and tearfully) admitted his mistake. This notwithstanding, baseball commissioner Bud Selig declined to change the call. But would he have acted differently if Joyce had maintained, in the face of overwhelming evidence to the contrary, that his call was correct—or even worse, that he deliberately called the runner safe?

Turning back to the law, what happens if lower-court judges thumb their collective noses at the Supreme Court? This is a timely question, because it is about to be placed squarely in front of the Supreme Court.

In early 1999 John and Theresa Sophocleus were forced out of their home by Alabama’s Department of Transportation (ALDoT) as part of a highway-widening project. In court ALDoT representatives testified that they needed to raze the home immediately to ensure timely progress on the road project. In fact, the Sophocleus home was not razed for nine months, during which it was used as a residence for contractors employed by ALDoT. In other words, the specific public purpose given by ALDoT to justify the seizure, made under threat of $10,000-per-day fines, proved to be invalid.

Mr. and Mrs. Sophocleus sued ALDoT, arguing that the taking was unconstitutional since the state did not live up to the expressed public purpose used to justify the seizure and that therefore ownership should revert to them. The first federal judge to consider motions in the case, Susan Walker of the U.S. District Court for the Middle District of Alabama, issued three summary judgments in their favor. Their case then was taken over by Judge Myron Thompson of the same court, who ruled that they should have taken their claim to the state courts rather than the federal courts. But as Alabama State Code 18-1A-et seq. makes clear, as affirmed by Judge Walker, the correct venue for plaintiffs in a civil rights case is the federal judiciary. By an 8–0 ruling (Justice John Roberts had not yet joined the Court) the Supreme Court in 2005 remanded the case back to the district court for remedy.

After stalling four full years, Judge Thompson and the judges on the 11th Circuit Court of Appeals refused to admit the earlier call had been blown and reiterated the previously overturned position. Once again, Mr. and Mrs. Sophocleus will appeal to the Supreme Court.

The original writ they filed with the Supreme Court was only 12 pages long. Their point, simple and powerful, was supported fully by the Supreme Court. Make no mistake—a unanimous Supreme Court decision overturning their ruling means the lower court was told, loudly, that it blew the call. So why did it take Judge Thompson over four years to respond? One interpretation is that he knowingly intended to frustrate the stated direction of the Supreme Court by delaying remedial action until either Mr. and Mrs. Sophocleus or their critical witnesses died or became mentally incapacitated. More important: Why, in the face of overwhelming evidence to the contrary, has the lower court refused to admit it blew the call? This is the critical question for all Americans who believe that they live under the rule of law.

Presumably, the Supreme Court has a deep interest in whether lower-court judges follow their instructions—that is, actually follow the law. The law of the land is enshrined in the Constitution as interpreted by the Supreme Court. If lower-court judges do not pay attention to the Supreme Court, they are not upholding the law. By implication, we do not live under the rule of law; rather, we live under the arbitrary and capricious rule of rogue judges, with justice denied when it suits their purpose. The judge is attempting to deny the rule of law to Mr. and Mrs. Sophocleus.

Rogue judges impose their own capricious rulings because they know there is little consequence for their actions. By virtue of lifetime appointments to the federal bench, and with scant likelihood of impeachment by Congress, they can use the legal process and their position to effectively deny justice to victims of civil rights violations. We all have a critical stake in curtailing this type of judicial behavior.

There is one, and only one, remaining protection for Mr. and Mrs. Sophocleus against the denial of justice orchestrated by rogue Judge Thompson and the complicit appellate judges: Instead of remanding the case back to the lower court for remedy again, presumably with the same expected result, the Supreme Court should impose a remedy. Under the best of circumstances, the chance that the Supreme Court will take a particular case is remarkably slim. Nonetheless, the Sophocleuses hit a home run their first time at bat, but have been denied justice due to interference by rogue umpires. We can only hope that on appeal this time, the Supreme Court ensures that their previous home run is ruled a grand slam on behalf of all Americans.

But this is precisely backward. Existing problems of excess energy consumption, pollution, big-box stores, the car culture, and suburban sprawl result from the “massive political pressure” that has already been applied, over the past several decades, to “redesign our cities, our farming, and our lives.” The root of all the problems Monbiot finds so objectionable is State intervention in the marketplace.

In particular, subsidies to transportation have probably done more than any other factor (with the possible exception of intellectual property law) to determine the present shape of the American corporate economy. Currently predominating firm sizes and market areas are the result of government subsidies to transportation.

Adam Smith argued over 200 years ago that the fairest way of funding transportation infrastructure was user fees rather than general revenues: “When the carriages which pass over a highway or a bridge, and the lighters which sail upon a navigable canal, pay toll in proportion to their weight or their tonnage, they pay for the maintenance of those public works exactly in proportion to the wear and tear which they occasion of them.”

This is not, however, how things were actually done. Powerful business interests have used their political influence since the beginning of American history to secure government funding for “internal improvements.” The real turning point was the government’s role in creating the railroad system from the mid-nineteenth century on. The national railroad system as we know it was almost entirely a creature of the State.

The federal railroad land grants included not only the rights-of-way for the actual railroads, but extended 15-mile tracts on both sides. As the lines were completed, this adjoining land became prime real estate and skyrocketed in value. As new communities sprang up along the routes, every house and business in town was built on land acquired from the railroads. The tracts also frequently included valuable timberland. The railroads, according to Matthew Josephson (The Robber Barons), were “land companies” whose directors “did a rushing land business in farm lands and town sites at rising prices.” For example, under the terms of the Pacific Railroad bill, the Union Pacific (which built from the Mississippi westward) was granted 12 million acres of land and $27 million worth of 30-year government bonds. The Central Pacific (built from the West Coast eastward) received nine million acres and $24 million worth of bonds. The total land grants to the railroads amounted to about six times the area of France.

Theodore Judah, chief engineer for what became the Central Pacific, assured potential investors “that it could be done—if government aid were obtained. For the cost would be terrible.” Collis Huntington, the leading promoter for the project, engaged in a sordid combination of strategically placed bribes and appeals to communities’ fears of being bypassed in order to extort grants of “rights of way, terminal and harbor sites, and . . . stock or bond subscriptions ranging from $150,000 to $1,000,000” from a long string of local governments that included San Francisco, Stockton, and Sacramento.

Government also revised tort and contract law to ease the carriers’ way—for example, by exempting common carriers from liability for many kinds of physical damage caused by their operation.

Had railroad ventures been forced to bear their own initial capital outlays—securing rights of way, preparing roadbeds, and laying track, without land grants and government purchases of their bonds—the railroads would likely have developed instead along the initial lines on which Lewis Mumford speculated in The City in History: many local rail networks linking communities into local industrial economies. The regional and national interlinkages of local networks, when they did occur, would have been far fewer and far smaller in capacity. The comparative costs of local and national distribution, accordingly, would have been quite different. In a nation of hundreds of local industrial economies, with long-distance rail transport much more costly than at present, the natural pattern of industrialization would have been to integrate small-scale power machinery into flexible manufacturing for local markets.

Alfred Chandler, in The Visible Hand, argued that the creation of the national railroad system made possible, first, national wholesale and retail markets, and then large manufacturing firms serving the national market. The existence of unified national markets served by large-scale manufacturers depended on a reliable, high-volume distribution system operating on a national level. The railroad and telegraph, “so essential to high-volume production and distribution,” were in Chandler’s view what made possible this steady flow of goods through the distribution pipeline: “The revolution in the processes of distribution and production rested in large part on the new transportation and communications infrastructure. Modern mass production and mass distribution depend on the speed, volume, and regularity in the movement of goods and messages made possible by the coming of the railroad, telegraph and steamship.”

The Tipping Point

The creation of a single national market, unified by a high-volume distribution system, was probably the tipping point between two possible industrial systems. As Mumford argued in Technics and Civilization, the main economic reason for large-scale production in the factory system was the need to economize on power from prime movers. Factories were filled with long rows of machines, all connected by belts to drive shafts from a single steam engine. The invention of the electric motor changed all this: A prime mover, appropriately scaled, could be built into each individual machine. As a result, it was possible to scale machinery to the flow of production and situate it close to the point of consumption.

With the introduction of electrical power, as described by Charles Sabel and Michael Piore in The Second Industrial Divide, there were two alternative possibilities for organizing production around the new electrical machinery: decentralized production for local markets, integrating general-purpose machinery into craft production and governed on a demand-pull basis with short production runs and frequent shifts between product lines; or centralized production using expensive, product-specific machinery in large batches on a supply-push basis. The first alternative was the one most naturally suited to the new possibilities offered by electrical power. But in fact what was chosen was the second alternative. The role of the State in creating a single national market, with artificially low distribution costs, was almost certainly what tipped the balance between them.

The railroads, themselves largely creatures of the State, in turn actively promoted the concentration of industry through their rate policies. Sabel and Piore argue that “the railroads’ policy of favoring their largest customers, through rebates” was a central factor in the rise of the large corporation. Once in place, the railroads—being a high fixed-cost industry—had “a tremendous incentive to use their capacity in a continuous, stable way. This incentive meant, in turn, that they had an interest in stabilizing the output of their principal customers—an interest that extended to protecting their customers from competitors who were served by other railroads. It is therefore not surprising that the railroads promoted merger schemes that had this effect, nor that they favored the resulting corporations or trusts with rebates.”

Reprising the Role

As new forms of transportation emerged, the government reprised its role, subsidizing both the national highway and civil aviation systems.

From its beginning the American automotive industry formed a “complex” with the petroleum industry and government highway projects. The “most powerful pressure group in Washington” (as a PBS documentary called it) began in June 1932, when GM president Alfred P. Sloan created the National Highway Users Conference, inviting oil and rubber firms to help GM bankroll a propaganda and lobbying effort that continues to this day.

Whatever the political motivation behind it, the economic effect of the interstate system should hardly be controversial. Virtually 100 percent of roadbed damage to highways is caused by heavy trucks. After repeated liberalization of maximum weight restrictions, far beyond the heaviest conceivable weight the interstate roadbeds were originally designed to support, fuel taxes fail miserably at capturing from big-rig operators the cost of pavement damage caused by higher axle loads. And truckers have been successful at scrapping weight-distance user charges in all but a few western states, where the push for repeal continues. So only about half the revenue of the highway trust fund comes from fees or fuel taxes on the trucking industry, and the rest is externalized on private automobiles.

This doesn’t even count the 20 percent of highway funding that’s still subsidized by general revenues, or the role of eminent domain in lowering the transaction costs involved in building new highways or expanding existing ones.

As for the civil aviation system, from the beginning it was a creature of the State. Its original physical infrastructure was built entirely with federal grants and tax-free municipal bonds. Professor Stephen Paul Dempsey of the University of Denver in 1992 estimated the replacement value of this infrastructure at $1 trillion. The federal government didn’t even start collecting user fees from airline passengers and freight shippers until 1971. Even with such user fees paid into the Airport and Airways Trust Fund, the system still required taxpayer subsidies of $3 billion to maintain the Federal Aviation Administration’s network of control towers, air traffic control centers, and tens of thousands of air traffic controllers.

Eminent domain also remains central to the building of new airports and expansion of existing airports, as it does with highways.

Subsidies to airport and air traffic control infrastructure are only part of the picture. Equally important was the direct role of the State in creating the heavy aircraft industry, whose jumbo jets revolutionized civil aviation after World War II. In Harry Truman and the War Scare of 1948, Frank Kofsky described the aircraft industry as spiraling into red ink after the end of the war and on the verge of bankruptcy when it was rescued by the Cold War (and more specifically Truman’s heavy bomber program). David Noble, in America by Design, made a convincing case that civilian jumbo jets were only profitable thanks to the government’s heavy bomber contracts; the production runs for the civilian market alone were too small to pay for the complex and expensive machinery. The 747 is essentially a spinoff of military production. The civil aviation system is, many times over, a creature of the State.

The State and the Corporation

It’s hard to avoid the conclusion that the dominant business model in the American economy, and the size of the prevailing corporate business unit, are direct results of such policies. A subsidy to any factor of production amounts to a subsidy of those firms whose business models rely most heavily on that factor, at the expense of those who depend on it the least. Subsidies to transportation, by keeping the cost of distribution artificially low, tend to lengthen supply and distribution chains. They make large corporations operating over wide market areas artificially competitive against smaller firms producing for local markets—not to mention big-box retailers with their warehouses-on-wheels distribution model.

Some consequentialists treat this as a justification for transportation subsidies: Subsidies are good because they make possible mass-production industry and large-scale distribution, which are (it is claimed) inherently more efficient (because of those magically unlimited “economies of scale,” of course).

Tibor Machan argued just the opposite in the February 1999 Freeman:

Some people will say that stringent protection of rights [against eminent domain] would lead to small airports, at best, and many constraints on construction. Of course—but what’s so wrong with that?

Perhaps the worst thing about modern industrial life has been the power of political authorities to grant special privileges to some enterprises to violate the rights of third parties whose permission would be too expensive to obtain. The need to obtain that permission would indeed seriously impede what most environmentalists see as rampant—indeed reckless—industrialization.

The system of private property rights . . . is the greatest moderator of human aspirations. . . . In short, people may reach goals they aren’t able to reach with their own resources only by convincing others, through arguments and fair exchanges, to cooperate.

In any case, the “efficiencies” resulting from subsidized centralization are entirely spurious. If the efficiencies of large-scale production were sufficient to compensate for increased distribution costs, it would not be necessary to shift a major portion of the latter to taxpayers to make the former profitable. If an economic activity is only profitable when a portion of the cost side of the ledger is concealed, and will not be undertaken when all costs are fully internalized by an economic actor, then it’s not really efficient. And when total distribution costs (including those currently shifted to the taxpayer) exceed mass-production industry’s ostensible savings in unit cost of production, the “efficiencies” of large-scale production are illusory.

Note that in my short list of examples, each one is due to action by the federal government. In Leviathan, Clint Bolick reminds us that Americans have every bit as much to fear from authoritarian laws, regulations, and confiscations at the hands of local government officials as they do from the great circus of government camped in Washington. In fact, he argues that we actually have more to fear from our local Pooh-Bahs, writing, “If the president starts an unpopular war or raises taxes, people know who to blame and they direct their energy accordingly. But if your kid gets a lousy education in public school, or your local government decides to exercise eminent domain to take your home or business, it is often impossible even to find out who is responsible, much less to fight it.”

Bolick, an attorney who has fought many legal battles against intrusive and authoritarian local government actions, gives us a depressing catalogue of the rights infringements that are becoming commonplace—violations of freedom of speech, freedom to engage in commerce, freedom to use and enjoy one’s property, and more. He first disabuses his reader of the notion that the Constitution protects people against such infringements, noting that most judges—and crucially, the justices of the Supreme Court—don’t take seriously the idea of individual rights. They choose only a few rights they like (for example, free speech, some of the time) and defend them against legislative or regulatory incursion, but adopt a posture of “deference” to the supposed expertise of politicians and their appointed agents on most other questions.

Consider the case of Garland Allen. Allen, a rather elderly black barber, had been practicing his trade for many years in a small town in rural Tennessee. In 1996 he was arrested in his barber shop for the crime of “impersonating a professional.” No customer had complained about Allen’s competence, but a competing barber had notified the august Tennessee Board of Barbering Examiners that Allen didn’t have a license to work as a barber. When he was young, no barbering schools in Tennessee admitted blacks, and now Allen couldn’t afford the nine months and $5,000 it would cost for him to go to school to be taught what he already knew. He was in danger of being put out of business and into poverty because of a completely needless regulation, the sole purpose of which was to restrict competition.

Fortunately for Allen, the Institute for Justice, for which Bolick works, threatened to sue to block the Board of Barbering Examiners from taking away his livelihood. The threat of action succeeded. Unfortunately, thousands of others are caught up in such occupational licensing snares each year. Freedom to engage in simple commerce is blocked by innumerable laws and regulations put in place by friendly state and local politicians—friendly, that is, to interest groups that want barriers to entry into their fields.

Bolick also details the vicious abuse of eminent domain, which under the Supreme Court’s current reading of the Fifth Amendment (hostile both to the document’s intent and to the rights of property owners) allows government to seize land from people whenever politicians decide that transferring it to someone else serves “the public interest.” Again, he shows that the government that’s supposedly the closest to the people can be the most callous.

Perhaps even more disturbing are the many civil asset-forfeiture laws enforced by state and local officials. Those laws permit officials to seize property without any compensation if they can convince a judge—and there are plenty of judges who don’t give a hoot about private property except their own—that it was used in connection with a crime. In one case Bolick relates, a woman whose teenage son had been driving her car when caught selling drugs had to suffer the loss of the vehicle. Never mind that she had no knowledge of her son’s activities. She was eventually able to show that local officials were living high on the proceeds of confiscated property. That particular statute was struck down by an appellate court on due-process grounds, but many others like it remain.

Bolick concludes with a helpful and hopeful chapter, “Fighting Big Government at the Local Level,” which shows that people don’t have to meekly tolerate these assaults on their rights.

If the most useful books are those that make people justifiably angry, Clint Bolick has written an extremely useful one.

America at one time was a market economy, but as the country has aged, we have slid toward socialism in many respects. Among the signs of this slide is the loss of freedom to control one’s own land. That’s the case with farmers, for example, who must abide by government regulations on the crops they may grow. It’s the case with urban landowners, who must abide by zoning regulations. And it’s also the case when land is taken from owners under what is called eminent domain. This is the theme of Abuse of Power by journalist Steven Greenhut, who has followed this subject for years. What Greenhut gives us is a thorough investigation of the rampaging growth of this assault on private property, which frequently leaves the reader shaking his head in disbelief at the villainy of the process.

The original concept of eminent domain sanctioned in the Constitution is that government may take private property when it is necessary for a public use, and then only if just compensation is paid to the owner. Even that is a dangerous departure from libertarian principles; government should no more make anyone “an offer he can’t refuse” than should criminals. But so long as eminent domain was limited to property seizures only for true public uses—roads, for example—the damage was fairly small. The problem, Greenhut informs us, is that eminent domain is now routinely used to take land from people not for some public use, but instead to advance anything that might be called a public purpose. By going along with this, the courts (the U.S. Supreme Court is now the main culprit) have allowed an almost limitless expansion of eminent domain.

As Greenhut shows with many, many cases, eminent domain is now routinely used to transfer land from one party to another simply because politicians believe that it will be put to better use. “Better” here simply means “paying more in taxes.” An old house or a small business brings in a small tax take. Condemning the property and forcing its sale in order to hand it over to a big commercial enterprise that will generate far more tax revenue is regarded by many politicians as a public purpose. They have no qualms about slapping the label “blighted” on people’s homes or businesses so they can force them out.

Forced transfers to satisfy politicians and well-heeled developers are appalling enough, but the other side of the transaction is also terrible. The requirement of “just compensation,” Greenhut contends, is often ignored. “Almost always,” he writes, “the government tries to lowball the property owner, in many cases offering a fraction of the property’s value.” The unfortunate property owner usually loses. Even if he hires an attorney to contest the amount offered, the legal expenses involved generally mean a considerable net loss in wealth for him. (Of  course, “compensation” in a forced sale can never be just; justice requires consent.)

Where is the judiciary in all this? Won’t judges step in to stop these seizures? Unfortunately, no, as Greenhut demonstrates. Judges are often indifferent to the plight of individuals targeted for removal. Most seem to share the mindset of the politicians: that people who fight against eminent domain are greedy opponents of social progress.

Not even churches are safe from eminent domain. Actually, tax-exempt property is among the least desirable of all uses from the standpoint of tax-hungry politicians. Greenhut’s cases where churches have been eminent-domain victims will raise the reader’s ire further.

An instructive side lesson is that many of the politicians guilty of eminent-domain atrocities are “liberals” whose campaign rhetoric oozes with “compassion” for the supposedly downtrodden citizens.They don’t mind treading all over real people, however, if it will enable them to achieve the supreme objective of an expanded tax base, enabling them to spend more on their favorite projects and constituencies. Eminent domain is another piece of evidence for the Public Choice economists.

At the book’s end Greenhut offers helpful advice to people who find that they need to fight back. It can be done. Bravo to the author for showing how.

As Ludwig von Mises wrote in Socialism:

Nowhere and at no time has the large scale ownership of land come into being through the working of economic forces in the market. It is the result of military and political effort. Founded by violence, it has been upheld by violence and by that alone…. The great landed fortunes did not arise through the economic superiority of large scale ownership, but through violent annexation outside the area of trade.

According to this story in the Observer (UK), this still goes on today, in Africa:

Ethiopia is one of the hungriest countries in the world with more than 13-million people needing food aid, but paradoxically the government is offering at least 7.5 million acres of its most fertile land to rich countries and some of the world’s most wealthy individuals to export food for their own populations….

But Ethiopia is only one of 20 or more African countries where land is being bought or leased for intensive agriculture on an immense scale in what may be the greatest change of ownership since the colonial era.

An Observer investigation estimates that up to 50m hectares of land – an area more than double the size of the UK – has been acquired in the last few years or is in the process of being negotiated by governments and wealthy investors working with state subsidies.

The land rush, which is still accelerating, has been triggered by the worldwide food shortages which followed the sharp oil price rises in 2008, growing water shortages and the European Union’s insistence that 10% of all transport fuel must come from plant-based biofuels by 2015.

In many areas the deals have led to evictions, civil unrest and complaints of “land grabbing”….

Leading the rush are international agribusinesses, investment banks, hedge funds, commodity traders, sovereign wealth funds as well as UK pension funds, foundations and individuals attracted by some of the world’s cheapest land.

Together they are scouring Sudan, Kenya, Nigeria, Tanzania, Malawi, Ethiopia, Congo, Zambia, Uganda, Madagascar, Zimbabwe, Mali, Sierra Leone, Ghana and elsewhere. Ethiopia alone has approved 815 foreign-financed agricultural projects since 2007. Any land there, which investors have not been able to buy, is being leased for approximately $1 per year per hectare.

According to an Ethiopian living in England:

The foreign companies are arriving in large numbers, depriving people of land they have used for centuries. There is no consultation with the indigenous population. The deals are done secretly. The only thing the local people see is people coming with lots of tractors to invade their lands.

All the land round my family village of Illia has been taken over and is being cleared. People now have to work for an Indian company. Their land has been compulsorily taken and they have been given no compensation. People cannot believe what is happening. Thousands of people will be affected and people will go hungry.

This is eminent domain and Kelo writ very large. Some, seeing the involvement of  corporations, will conclude this is privatization and modernization. But true champions of liberty and property will be appalled and will condemn it loudly for the theft and usurpation it is.

We can assume it fell short since the federal government is ever incompetent and has been tight-lipped about how many miles it has completed.

More people cross this international boundary each year than any other in the world—250 million with government permission, a fraction of that without. (Estimates range from 400,000 to a million.) Patches of the border, particularly urban ones, have been fenced and policed for decades. But this dotted line inconvenienced rather than stopped folks who neglected to secure a bureaucrat’s consent for their trip: Travelers trying to exercise their inalienable right to free movement simply went around the barriers. The feds never like being outfoxed, so they extended the fencing beyond populated areas. This drove migrants into increasingly remote and hostile terrain. There they not only had to survive encounters with America’s Border Patrol but also dehydration and other dangers in the desert. No More Deaths, a group that caches food and water along routes migrants are likely to take, estimates that at least 238 travelers perished in Arizona alone in 2006, with more than 4,000 “men, women, and children [losing] their lives in the deserts of the US-Mexico borderlands” from 1998 to the present.

Walling off Rights

You might think that would be tragedy enough for anyone. But as former President George W. Bush said when he signed the SFA, “We have a responsibility to enforce our laws. We have a responsibility to secure our borders. We take this responsibility seriously.” Apparently far more seriously than we do corpses or constitutional limits on government. And so the Act “authorize[d] the Department of Homeland Security to increase the use of advanced technology, like cameras and satellites and unmanned aerial vehicles to reinforce our infrastructure at the border.”

Authorizing DHS to grab more power is about as necessary as authorizing sparks to fly upward. Nevertheless, Congress exempted DHS from all federal laws as part of its 2005 REAL ID legislation. All it has to do is claim that a law impedes progress on the wall. Section 102 (c)1 of the REAL ID Act says, “Notwithstanding any other provision of law, the Secretary of Homeland Security shall have the authority to waive, and shall waive, all laws such Secretary, in such Secretary’s sole discretion, determines necessary to ensure expeditious construction of the barriers and roads under this section.”

This immunity extends all the way to judicial review: Judges can’t “order compensatory, declaratory, injunctive, equitable, or any other relief for damage alleged to arise from any such action or decision,” according to Section 102 (c) 2B. So far the unrelieved victims have been mostly Americans whose property the agency has seized or destroyed. Surely even those most opposed to immigration would agree that stopping it does not excuse such tyranny and injustice against citizens.

Environmental Destruction

Among the many regulations DHS is ignoring are environmental ones. But Mother Nature isn’t as easily overridden. There are consequences for flouting the laws of physics, for example. And DHS’s insouciance towards things like gravity and water has already hurt the government’s own property.

On July 12, 2008, a heavy rain near Ajo, Arizona, clogged drains in completed sections of the fence, damming the downpour and flooding Organ Pipe Cactus National Monument, the only area in the United States where the plant grows wild. Park superintendent Lee Baiza told the Associated Press, “[We] had suggested that [DHS] take into consideration everything that can happen with a weather event. . . . We had a concern that this was going to happen.” And this storm wasn’t even a hurricane such as frequently roars through the Gulf and neighboring Texas.

The Rio Grande River separates Texas from Mexico for 1,254 miles before heading north. It waters a huge variety of wildlife, and that abundance draws conservancies to the area. Some are private, such as the Sabal Palm Audubon Center in Brownsville, Texas. Others are government-held lands that the U.S. Fish and Wildlife or National Parks Service manage. Over the decades, these organizations have cooperated with one another and the Mexican government to form a “wildlife corridor” so animals can range freely even if people can’t. The corridor also acts as a sanctuary for rare or endangered species. But DHS seems as hostile to animal life as it does to human life. It is hacking through this territory with a wide corridor of walls running parallel to one another, asphalt roads between, and hundreds of yards of cleared land to the north and south.

Barriers for stopping bipeds stop quadrupeds, too. This imperils animals that wander widely to feed or mate. Audubon Magazine points out that the inbreeding the wall compels will weaken if not exterminate America’s last colony of ocelots. This cat once roamed the Rio Grande and southern Arizona but now counts fewer than 100 members on the Texas side of the border.

A biologist at the University of New Mexico worries about other predators as well. Dr. Joe Cook told the Inter Press Service, “There is no quetion that jaguars . . . in the U.S. and northern Mexico would be significantly affected by the wall. . . . The only hope to preserve large carnivores in the wild is to have large areas of continuous, unfragmented habitat.”

The Mississippi and Central migratory flyways meet at the Rio Grande. Birds that once rested there during thousand-mile journeys will now contend with barren, paved land instead of trees, bushes, nuts, and seeds. Floodlights that turn desert night into day to discover migrants are already disorienting not only birds but bats and butterflies as well.

Financial Destruction

Matching the wall’s environmental disasters are its financial ones. In January 2007 the Congressional Research Service figured that 700 miles would cost about $49 billion, including maintenance. But as usual with the state’s estimates, this one probably isn’t worth the paper it’s printed on, especially if the rest of the barrier is anything like the 14 miles that wind inward from the California coast at San Diego. The first fence there—ten-foot-tall walls of welded steel—went up in 1993. Next came a “secondary” wall, this one 14 feet high, about 103 feet to the north. A chain-link fence runs parallel to that, with “stadium lighting” throwing every ugly detail into sharp relief. This monstrosity was supposed to cost $1 million per mile, but that skyrocketed to $3.8 million. And construction isn’t yet finished, in part because the California Coastal Commission frets about erosion. The bit that remains unfenced meanders through more challenging terrain, with construction estimated to reach $10 million per mile. If the price for the other 700 miles escalates proportionally, we are looking at an outlay of anywhere from $200 to $490 billion.

There are other, more hidden expenses. For example, the Fish & Wildlife Service has spent $100 million of our money over the last three decades to buy and replant land near the Rio Grande. The wall will ruin that investment. It will also end “eco-tourism” and the $125 million that 200,000 visitors annually spend in the hopes of glimpsing an ocelot or a Muscovy duck.

Naturally, while most Americans pay for the fence, a select few profit. DHS hired Boeing to implement its Secure Border Initiative (SBI) in September 2006. The company will install 1,800 towers as a “virtual fence” on our northern and southern borders within three years to “detect and track intruders through the use of cameras, sensors and motion detectors,” as Federal Computer Week puts it—all for only $2.5 billion. Needless to say, Boeing and DHS trumpeted their lucrative deal as a revolutionary, unprecedented, sure-fire solution for the “border problem” the feds have created. But the Washington Post took a more jaundiced view, citing the government’s “series of failures [in] control[ling] U.S. borders.” So did agents on the ground. Rich Pierce, executive vice president of the Border Patrol’s union, told Federal Computer News, “[SBI]—it’s been tried and it’s failed. . . . They’re not going to try anything new. . . . The people in the field know it’s not going to work.”

So did the legislators voting the funds. Rep. Harold Rogers was chairman of the Homeland Security Subcommittee from 2003 until January. According to the June 26, 2006 issue of Government Computer News, he “noted that spending on border security since 1995 has ‘quadrupled from $5.1 billion to over $17.9 billion,’ and the number of agents has jumped from 5,000 to 12,319. ‘However, during this same period, the number of illegal immigrants has jumped from 5 million to an estimated 12 million,’ Rogers said. ‘The policy of more money and no results is no longer in effect. We will not fund programs with false expectations.’” That would explain his subcommittee’s handing $39.9 billion to DHS in FY2009 with Rogers’s “support,” as he proclaimed on his website, despite the agency’s reputation even among the feds as one of their most wasteful and dysfunctional bureaucracies.

Sending Property Owners to Limbo . . .

Knowing that the fence won’t stop immigration, that it merely allows politicians to look as though they’re fixing an issue they’ve ginned up into a crisis, must particularly gall the property owners losing homes and businesses. Most of those victims live in Texas since the feds already own much of the land along the other states’ borders.

The barriers have always been more of a sieve than a fence since they proceed in fits and starts with long gaps between. The new miles of fence will not be much different, according to the Border Patrol: Tom Rudd, the Patrol’s chief in Brownsville, Texas, is “expecting a total of nine miles of fence segments,” according to PBS. “The segments, Rudd says, will act like funnels, pushing migrants into areas where his agents will be waiting to capture them.”

Those funnels bisect plenty of private property, including homes, farms, businesses, and nature preserves, as well as national parks and even towns. Stunningly, they don’t line the actual border. Some of the wall lies as much as two miles north of it. Landowners whose properties fall within that region face a bizarre limbo, severed from the rest of the country—and from the services their taxes supposedly buy them. Audubon Magazine quotes the Society’s executive director in Texas, Anne Brown, on the fate of its Sabal Palm Center: “From what we’ve heard, we’ll have to close. We can’t figure a way to keep it open, because we’ll be cut off from the rest of the United States. Will we be insured? Will we receive city services? We can’t let Ernie [the caretaker] live here anymore.” The magazine adds, “The sanctuary and its unique plants and wildlife will be taken from the American people, and what survives will be, for all intents and purposes, ceded to Mexico.”

Ordinary owners in Limbo Land also face extraordinary challenges. Pamela Taylor is an elderly émigré from England who married an American soldier 50 years ago, then moved to Brownsville with him. If anyone should welcome the protection the wall allegedly provides, it would be Mrs. Taylor. She once arrived home to find a migrant hiding from the Border Patrol in her living room. But she fears DHS and its fence far more than she does people looking for jobs and better lives. “They said the fence was gonna go right across the street,” she told PBS. “And . . . my son-in-law asked, ‘Well, do you mind, how are we going to get out?’ And the fellow from the Corps of Engineers said, ‘Well, you know, we hadn’t really thought about that. I guess you’re gonna have to follow the border patrol out.’” Obviously, that enormously complicates even the simple errand of buying groceries. And it could be fatal should Mrs. Taylor need a doctor.

PBS asked the Border Patrol’s Rudd about ingress and egress for the Americans caught in this quandary. Rudd said there will be “gates” and that “we’re still lookin’ right now—at different—locking mechanisms of what’s gonna work best in certain areas. . . . [O]ne approach that I’m lookin’ at . . . is—a push-key type, you know, the—the number system, a push pad . . . enforced with a camera—so we can make sure that that number or that combination—doesn’t get compromised . . . basically work with the owner to find out who’s gonna be in that area, what kinda vehicle they’d be driving.” The government hasn’t touched Mrs. Taylor’s property and so isn’t offering even eminent domain’s pittance, but it robs her nonetheless. Her land will be worthless. What buyer wants a hassle every time he needs a quart of milk?

DHS plans to swipe some properties lying directly in the fence’s path in their entirety, particularly when the parcel is small because the owner is poor. Other times, the fence threatens only a portion of the property—but it might as well take the whole piece because once again it’s destroying the land’s value. Leonard and Debbie Loop and their children own a 1,000-acre farm in Brownsville. But the wall will exile 800 acres to Limbo Land.

. . . Unless They’re Rich or Connected

Given that the wall doesn’t follow the border, as well as its frequent stops and starts, its placement is arbitrary at best. Many victims have noticed that while DHS expects them to sacrifice their interests, it is skirting property belonging to wealthy, politically connected neighbors. One victim, Eloisa Tamez, is a 72-year-old woman who still lives on some of the 12,000 acres her ancestors received in a Spanish land grant. She’s been down this road before. The feds stole more than half her holdings in the 1930s to build levees, and they didn’t pay a dime for any of it. The Texas Observer reports that now they want more. But the wall gobbling Ms. Tamez’s home stops short two miles down the road. That just happens to be the edge of Sharyland Plantation, 6,000 acres that billionaire Ray L. Hunt is developing into a luxurious, gated community of million-dollar homes. Hunt, of course, is not only George W. Bush’s buddy but his benefactor, too, since he’s kicking in $35 million toward the presidential library. The wall resumes on the other side of Sharyland.

Under former secretary Michael Chertoff, DHS refused to answer questions from folks like Ms. Tamez. But silence has long been one of the agency’s favorite tactics. It almost always withholds information on the grounds that telling the citizens who pay its bills what it’s doing with their money would jeopardize national security. It will neither confirm nor deny who’s on its notorious Terrorist Watch List, for instance, not even to the victims themselves. And so it goes with the wall. DHS refuses to verify its plans or discuss its rationale for the wall’s route. That leaves many owners grappling with rumors and stomach-churning uncertainty. Others are fairly sure DHS will steal their holdings because it has already ordered them to sign waivers allowing surveyors to measure their property. Those who refuse find themselves facing condemnation of their land.

Chertoff tried to cast cooperating with the agency’s theft as a patriotic duty. Despite abundant evidence to the contrary, he announced in February 2008, “I respect private property. But you cannot make border security and national security an individual choice for each individual landowner. . . . [W]hen people are smuggling drugs and human beings across the border, for an individual landowner to say, ‘I don’t care. I want to make sure that my view of the river is unobstructed,’ is not an acceptable answer.”

Dictatorical and Dishonest

That’s not only arrogant and dictatorial, it’s also profoundly dishonest. Protestors do not mourn vanishing vistas. They are instead defending their homes and businesses, some of which have been handed down through their families for generations. Meanwhile, the U.S. government’s unconstitutional jihads against those drugs and people it doesn’t like forces folks who want to transport either to smuggle them. Politicians have tried to control people’s movements and have failed at this immoral task; nevertheless, they expect the rest of us to cooperate with their new, desperate, criminal measures. Why?

Unfortunately, Leviathan has convinced most Americans that its campaign against “illegal” drugs justifies any and all abuses. So now it excuses its militarization of the Mexican border because of the marijuana crossing it. The feds take the same tack with “illegal” immigration. But they also spin things a bit differently to hide their heartlessness. They bewail the “smuggling of human beings,” conflating immigration with—incredibly enough—slavery.

In a speech on September 9, 2008, at the “Stop Human Trafficking Symposium,” conveniently sponsored by Customs and Border Patrol, Chertoff announced that “the line between so-called voluntary migration and human trafficking is not a very bold line. It is often the case that people who begin the movement across the border in a voluntary way . . . quickly turn into victims when they are held for ransom, or when they are required to work off the cost of the smuggling by paying off the vast majority of their wages to the smuggling organizations.” That may be exploitative, but it isn’t slavery since slaves seldom receive wages and so can’t “work off” any “cost.” And Chertoff ignores the fact that the government’s criminalization of migration gives those few entrepreneurs who do victimize their clients the chokehold they need: A “restaurant owner” who allegedly “trafficked hundreds of adults and children into the United States . . . threatened to turn them in to the authorities as illegal aliens if they tried to escape,” according to the Columbia (Missouri) Daily Tribune.

DHS portrays as vicious criminals guides who conduct people through hostile terrain and help them avoid the Border Patrol. The agency then presents its own ferocious attacks on immigrants, its armed patrols and cameras, its dogs, handcuffs, and holding pens, its hunts through the desert in air-conditioned ATVs for exhausted, fleeing families, as “rescuing” them from “human traffickers.” Odd, isn’t it, that migrants pay these “traffickers” to chaperone them across the border but try to fend off their “rescuers” by throwing rocks. They seldom succeed. Rather, they play right into the government’s hands: it charges them with the “crime” of self-defense, AKA, “assaulting a federal officer.” This inflates the number of “felons” crossing the border so that the feds “save” us from an even bigger menace.

An Unconstitutional Line in the Sand

Whether they’re between states or countries, borders soon cease to be noticed by most people living along them. They marry one another, establish businesses, visit, laugh, cry, agree, disagree, and dream together. So it is along the U.S.-Mexican boundary. The wall will sunder these families and friends as mercilessly as Berlin’s barricade did Germans.

The Founding Fathers understood government’s essence, its cruelty and callousness, far better than do modern Americans. That’s why their Constitution never empowers politicians to regulate anyone’s movement into or out of the country (except for slaves, fittingly enough: What else are we when we beg a bureaucrat, “Please, may I enter?”). Article 1, Section 9 bars Congress from “prohibit[ing]” the “Migration or Importation” of “such Persons as any of the States now existing shall think proper to admit” until 1808. If we dismiss the doctrine of enumerated powers, this implies that Congress may prohibit all the migrating and importing it likes thereafter. And if we also dismiss the literary and historical context that limits Article 1, Section 9 to slaves, it appears the feds may indeed control anyone’s immigration after 1808—but only in those states existing at the Constitution’s adoption. None of those border Mexico, and mighty few do Canada. DHS needs to relocate its wall down the Atlantic coast.

Nor does the Constitution deputize the central government to “protect” the country’s borders, much less build walls “funneling” migrants through deadly desert where cops lurk to kidnap them. Immigration ought never to have been federalized in the first place; government had no business arrogating an “interest” in it during the 1870s, then tightening its vise each decade since. Immigration is an issue of property rights—not the DHS’s infernal abrogation of them, but a decision by the folks Michael Chertoff so despises, “each individual landowner,” as to whether migrants may cross his property.

Despite its utter lack of constitutional authority, DHS will probably continue militarizing our borders. Its current secretary, Janet Napolitano, opposed a physical wall when she was governor of Arizona. As she told AP, “You show me a 50-foot wall and I’ll show you a 51-foot ladder at the border.” Heavily implied is her support for more border agents as well as more high-tech surveillance. Napolitano is as implacable an enemy of freedom of movement as her predecessor Chertoff was, even if her methods differ.

Meanwhile, America has another border to the north, which Boeing’s contract covers as well. Landowners there should be very worried, given the abuses their southern brothers have suffered.

Indeed, all of us should worry, if not panic, when we remember that the walls keeping others out also keep us in.

That is not to say that if the takings clause had been written differently we would have avoided the widespread destruction of property rights that has taken place. The trouble lies not in its wording but rather in the widespread belief shared by most politicians and judges that property rights must yield to a host of “social concerns.” To address those concerns, the country has been beset with schemes that deprive people of their rights.

No American scholar has invested more time in analyzing the legalities and consequences of the erosion of property rights than University of Chicago law professor Richard Epstein. Oxford chose wisely in asking him to write the book on property rights in their “Inalienable Rights” series.

Supreme Neglect is not a dry legal treatise. Epstein has a serious purpose in mind that a dry treatise would not serve: “to offer a roadmap for the revival of property rights in the United States and for the social improvement that this constitutional change should usher in.” Anyone who wants to understand what is at stake in the war over property rights should start with this book.

Epstein packs a lot into 169 pages. He begins with a general discussion of the benefits of private property, elaborating on the ways it facilitates social and economic progress by encouraging cooperation among people and directing resources to their most beneficial uses. Security in property rights allows people to find the ideal arrangements for the use (and the non-use) of land. With private property the owners reap the benefits of wise decisions and contracts but suffer the losses if they act mistakenly. Throughout the book Epstein contrasts the benefits that flow from private decision-making with the waste and folly of government interference.

The taking of private property through eminent domain is a “signature” issue with Epstein, and he drives home the point that government seizures of real estate for anything other than very narrow public uses ought not to be permitted. He was deeply involved in the 2005 Supreme Court case Kelo v. New London, where a thin majority held that takings for “economic development” were permissible. Epstein argues that rather than looking to government action to catalyze economic growth, especially in depressed areas, Americans should demand more freedom to acquire, invest in, and profit from real estate. The New London project proves a stark lesson in government blundering. Despite the city’s taking of private property that wasn’t even necessary for its grandiose plan, it languishes for want of commercial interest.

Epstein also shows that where government does pay property owners some compensation when it seizes their land or reduces its value, that compensation is usually far from adequate to make them whole. That enables politicians to parade in front of voters as great public benefactors for actions that do little good and for which the people probably wouldn’t pay if they had to make full compensation. Thus hapless property owners are routinely victimized for cheap political stunts. Historic preservation is a good illustration. Heavy costs are imposed on those who own buildings that are designated as “historic,” but how many people really care if some old property is maintained in its original, nineteenth-century condition? Only a few, who probably would not be willing to buy the property so they could preserve it themselves.

What Epstein terms the “exaction game” comes in for sharp criticism too. That is the nasty, extortionate ploy politicians have developed for compelling those who want to use their property to fund other, unrelated public “improvements” as well. Epstein blames the Supreme Court’s “muddy and inconclusive analysis of exactions” for allowing municipal governments to force developers to pay for art museums, low-income housing, daycare centers, and so on. On this issue, like all the others he tackles here, Epstein shows judges the right path to take if they’re interested in getting out of the mud.

Readers who expect to hear praise for such “conservative” justices as William Rehnquist and Antonin Scalia will be surprised to find that Epstein often criticizes them. His rigorous analysis steps on just about all the toes of Supreme Court justices past and present. Honest scholarship requires as much—the Court has been getting property rights cases wrong for a long time.

by Jörg Guido Hülsmann
Ludwig von Mises Institute • 2007 • 1143 pages • $50.00

Reviewed by Bettina Bien Greaves

Biographer Guido Hülsmann has written a magnificent book, describing in detail not only the life of Ludwig von Mises, but also his writings, his intellectual development, and his importance. Hülsmann studied all Mises’s works in German, English, and French, and the biographer’s fluency served him well. He traveled widely to locate Mises’s papers, files, personal correspondence, and documents and did vast research into his life and background.

First and foremost, the book covers Mises’s great contributions to economic understanding. He was not the most popular, renowned, or influential economist of the twentieth century, but was undoubtedly the most important. Perhaps his greatest contribution was the development of subjective-value economics as a science of reason, logic, and immutable laws. He explained all economic phenomena as outcomes of people’s actions, choices, and decisions on the basis of their respective subjective values. Those actions generate prices, production, money, trade channels, markets, wages, interest rates, capital goods, savings, investments, competition, profits, losses, and more.

Mises’s second important contribution was in the field of money and the monetary theory of the trade cycle. In his first theoretical book he explained that money was a market phenomenon. It developed out of barter as individuals, seeking to improve their personal situations, traded with one another. Each trader was attempting to exchange something he possessed for something he preferred more. Eventually, some individual ventured to offer what he had for something he could use, not immediately but in a later trade. Other would-be traders attempted similar exchanges. In time, people began to accept a readily tradable commodity as a medium of exchange—money.

Mises also described how inflation (monetary expansion) fostered by the banks leads to widespread price increases, economic malinvestment, and then inevitably, when the banks stopped inflating, the collapse of businesses, economic stagnation, and a readjustment of prices. Thus Mises—in 1912—laid the groundwork for understanding the economic crises and boom/bust cycles that have plagued capitalistic economies.

Mises’s third significant contribution was his analysis of socialism, considered “the wave of the future” in the early 1920s. In a socialist society all property would be owned and controlled by the state. Thus there would be no market and no market prices reflecting buyers’ and sellers’ bids and offers for property. Without market prices for either consumer’s or producer’s goods, government “planners” would have no guidance as to what people wanted and did not want, and no way to know when, where, and how best to produce anything. In short, there could be no economic planning.

Hülsmann describes the life and times of Mises in his native Austria—his family, cultural, and historical background. Mises grew up in a world in which almost everybody was an interventionist or socialist. He confessed later that when he entered the university he was “a complete statist.” Then in 1903 he read Carl Menger’s Principles of Economics, which introduced him to the subjective value theory and turned Mises’s thoughts in an entirely new direction; he said it “made an economist” of him.

Hülsmann tells about Mises’s search after World War I for a position in which he could not only earn his living but also pursue his interest in economics. In 1918 he joined the Austrian government’s advisory Chamber of Commerce. While with the Chamber he was able to continue his study of economics. He also taught at the University of Vienna as an unsalaried lecturer with the title of Professor Extraordinary, conducted a private economic seminar, and established the Austrian Institute for Business Cycle Research. In 1922, as economic adviser to the Austrian government, he was influential in halting the Austrian inflation before it reached such a disastrous level as in Germany.

Mises was always writing—newspaper articles, economic papers, and books on nationalism, socialism, liberalism, epistemology, money, and economic crises. His entire life was dedicated to trying to improve his own understanding of economics and to explain to others how the market operates. By quoting from Mises’s books, papers, and correspondence, Hülsmann does a masterful job of showing how Mises gradually refined his ideas and improved his explanations.

Hülsmann’s biography portrays a man of principle who was dedicated to pursuing the truth. By dint of his studies, he transformed himself into a powerful advocate of peaceful social cooperation and the free market. The book is fascinating reading for anyone interested in Mises, the person, the economist, the libertarian.

Bettina Bien Greaves served FEE for more than four decades as a senior staff member and resident scholar.

The Shock Doctrine: The Rise of Disaster Capitalism

by Naomi Klein
Metropolitan Books/Picador • 2007/2008 • 576 pages • $28.00 hardcover; $16.00 paperback

Reviewed by Joseph R. Stromberg

The core thesis of Naomi Klein’s Shock Doctrine is that American foreign and domestic policies of the last 30 years have shaped a new corporatism. Corporatism, Klein writes, “originally referred to Mussolini’s model of a police state run as an alliance of . . . government, businesses and trade unions . . . in the name of nationalism.” Latter-day corporatism involves “a huge transfer of wealth from public to private hands, followed by a huge transfer of private debts into public hands.” Neo-liberal corporatism “erases the boundaries between Big Government and Big Business,” while organized labor—indeed all labor—is locked out of the new arrangements.

Klein’s case is tightly organized, well presented, and overwhelming in cumulative impact. She makes a complex argument dealing with what are, indeed, complicated matters. Some reviewers complain that Klein forces the evidence into a pattern. They say her treatment of the views of certain psychologists, economists, and military planners and her comparative account of how those views are (were) implemented, are “unfair,” especially to the economists. But Klein rightly pursues the ideas in question across these fields of knowledge (and action) by analogy—a perfectly good Aristotelian and Thomistic procedure. “Hooding” a captive and “blacking out” an entire city by bombing are analogous, because they are done for the same reason—to disorient and confuse, and so on, through further stages of comparison.

The said psychologists, economists, and military planners dwell endlessly on certain themes because they see the world as a manipulable object and proceed from shared mechanistic, Hobbesian, positivist premises, whereby actual people are mere atoms, objects, or empty ciphers on indifference curves. We cannot be surprised that these experts’ activities complement one another in real life and reveal an indifference to “unforeseen consequences,” while a kind of mathematical Platonism underlies the supposedly “empirical” performances. Shared themes include “shock,” “shock therapy,” crises as experimental opportunities, and “clean slates” (Hobbes’s “clean paper”) on which to plot out new worlds. They talk this way; Klein makes nothing up.

Klein follows these common threads from the “free-market” Chilean tyranny, through Mrs. Thatcher’s rather mixed reforms, phony “privatizations” in Poland and Russia, the half-mad U.S. invasion of Iraq, with more phony “privatizations,” dispossession of small-holders in Sri Lanka, and “state failure” in New Orleans, where school vouchers were imposed while the city rotted.

The Sri Lankan case must suffice here. There, long-established fishermen, having survived the tsunami, were barred from their beach holdings, so that resort hotels favored by the World Bank, U.S. operatives, and investors might expand. This is precisely what a Chicago Law and Economics (Coasean) judge would do. The fishermen are “socially inefficient.” They got no “growth.” Away with their land! They may come back in the reformed “free market” as waiters and busboys.

One key to the new order, I would add, is this: By excluding war-making capacity (“defense”) from the concept of “state” by implicit definition, Republican “anti-statists” create a desert mirage. We can wrangle over smaller government any time; no one can reasonably hold that we are getting such a thing now from those in power, sundry “privatizations” notwithstanding.

Klein somewhat overplays the verbal opposition of “public” and “private.” The current rulers set up expensive contractors to coordinate already expensive defense-industry suppliers. This done, the contractors—clothed in state power—are no longer exactly “private”; neither are they “public” like the post office. Our “free market” reformers may answer for any conceptual confusion. And here, Klein may not see that the contractor fad is partly about empowering the Unitary Executive—shielding its operations from congressional oversight. But she is quite right to see numerous threats to democracy.

I would add that imposing “spontaneous orders” by debt-leveraging, “privatization,” or invasion amounts to right-wing social engineering—not an especially “conservative” vocation. Neither are “privatizations”—amounting to confiscations on the scale of Henry VIII—conservative. Our current regime calls to mind institutionalized Whig corruption after 1689, when (in E. P. Thompson’s phrase) England was a “banana republic,” everything was for sale, and income migrated upwards via the state.

There are some problems of language throughout the book. Reading it, one might think the author deplores any conceivable free markets whatsoever. Klein uses “capitalism” and “free market” to refer to assertions made by policymaking ideologues merchandising corporatist and imperial policies. I wish she had somehow separated official rhetoric from other possible, face-value meanings of these words, by putting them in quotes or occasionally writing “state-capitalist.”

This is, in any case, an important, insightful book. Klein’s specific critique of new-wave corporatism outweighs any disagreements some might have with her “third way” politics. Accordingly, I hope people read the book before falling into predictable, knee-jerk reactions.

Joseph R. Stromberg is an independent historian and writer living in Alabama.

The Medicalization of Everyday Life: Selected Essays

by Thomas Szasz
Syracuse University Press • 2007 • 168 pages • $19.95

Reviewed by Ross Levatter

Thomas Szasz’s most recent book is, in a sense, not recent at all. The Medicalization of Everyday Life is a compilation of 16 essays Szasz published over the last third of a century. Recent or not, these essays are still quite valuable.

There was a time when people led rich lives, filled with mistakes and successes, bad habits and good ones, cowardice and heroism. Now lives are simply filled with a variety of ailments, most of them psychiatric, that cause us to act in cowardly, evil, or mistaken ways. Were it not for narcissistic personality disorder and neuroses, schizophrenia and separation anxiety disorder, paranoia and panic disorder, life would be grand. It’s only mental disease that separates us from nirvana, and we place our faith in psychiatry and psychopharmacology to bring us to the promised land.

While we wait, we follow the new rules. We’re used to doctors telling us what to do. That’s how they help us get better. As more and more aspects of everyday life are viewed as types of illness, doctors try to become more and more helpful by promulgating more rules. They morph into powerful bureaucrats, often backed by the force of law.

Szasz describes this process as it has occurred over the last half of his professional lifetime. The change in the past few decades has been striking. Szasz makes this point by telling us about a psychiatric symposium he attended in 1973. He listened to discussions by psychiatrists “proving” that alcoholism was genetically determined and noticed that (as was then fashionable) the vast majority of psychiatrists in attendance were smoking cigars or cigarettes.

Szasz says: “When my turn came to speak, I asked why, if alcoholism is a mental disease, is nicotinism not also a mental disease?” This, he argued, is because most psychiatrists like to smoke but do not drink to excess. And since they control what counts as disease, they do not place their favorite pastimes in the disease category. Looking back 34 years later, we find the profession responds to outside pressures; the desire to smoke has become yet another mental illness since psychiatrists themselves have largely given up the habit.

This compilation contains several rare pieces most Szasz admirers have not previously seen. These include his thoughts on routine neonatal circumcision, his evaluation of the Terri Schiavo case, and his hostile view of philosopher Peter Singer’s ethics of medicalization. (Singer is the philosopher who argues that lower life forms have rights, not just humans.)

The book also includes an excellent essay on the history of psychiatry, originally published in the journal History of Psychiatry, which Szasz subsequently expanded into a major book, Coercion as Cure.

Although many of the essays deal with specific issues, there are also some excellent general essays that introduce new readers to Szasz’s approach to medicine and psychiatry. These include such classics as “Mental Illness: A Metaphorical Disease,” “Diagnoses Are Not Diseases,” and “Hysteria as Language.”

Szasz is perhaps best known for his views that psychiatry has become an excuse factory for criminality and a justification for authoritarian treatment of people who have committed no crime. The book contains two famous articles on those topics, “Psychiatry’s War on Criminal Responsibility,” and “Pharmacracy: The New Despotism.”

For libertarians the most controversial essay is apt to be Szasz’s analysis of the Terry Schiavo case. He describes her as “half-alive” (dead brain, living body). I would restrict terms like “half-alive” to patients with, say, cord lesions rendering them with a living upper half and “dead” lower half. My personal take is that dead brain means one is dead, even when, as in the case of a persistent vegetative state, the body still has a heart that beats and lungs that breathe.

Szasz argues that the family’s desire to maintain their daughter on life support should have prevailed, at least if they were willing to cover the costs, and that her husband had clear motives for desiring her death. But after decades of psychiatric practice, Szasz should be aware that parents don’t always have their children’s best interests at heart. He also should know that children of very religious parents are not always that religious themselves, yet frequently hide this fact. Thus it is not inconceivable that Michael Schiavo spoke truthfully in saying that, contrary to her religion, Terry didn’t want to live that way. Why didn’t he speak up earlier? Perhaps he had hoped that she’d revive. I see the issue as more morally ambiguous than Szasz does, but his discussion is nonetheless stimulating and based, as always, on libertarian principles.

The Medicalization of Everyday Life is a great introduction, or re-introduction, to the deep insights and delightful prose of Thomas Szasz. You won’t regret the time you invest in this book.

Dr. Levatter was the recipient of the Thomas S. Szasz Award for Outstanding Contributions to the Cause of Civil Liberties, Professional Category, in 2007.

The Antitrust Religion

by Edwin S. Rockefeller
Cato Institute • 2007 • 124 pages • $16.95

Reviewed by George C. Leef

Many years ago when I was in law school, I listened to a talk by a fellow student on antitrust law. Right at the beginning of his presentation, he earnestly stated that the antitrust laws were a “charter of freedom.” I was probably the only person in the room who winced. That “charter of freedom” line is an item of faith among most people (and nearly all lawyers) who have been told that antitrust laws protect companies—and thereby consumers—from the monopolistic designs of greedy business tycoons.

The reason I winced was that I knew that line is nonsense. As an undergraduate I had read Dominick Armentano’s iconoclastic book, The Myths of Antitrust, and understood that antitrust, far from protecting freedom, is an assault on it. Armentano subjected to withering analysis the naïve belief that antitrust law is necessary to the preservation of free markets. Had my classmate read that book, he’d have known how foolish his remarks were.

Since Armentano’s seminal work, there have been other scholarly critiques of antitrust. The most recent is Edwin Rockefeller’s The Antitrust Religion. Rockefeller has impeccable credentials to write such a book. He is a lawyer who has served on the staff of the Federal Trade Commission, chaired the American Bar Association’s antitrust section, and taught at Georgetown Law School. Instead of writing the kind of book you might expect from someone with that background—a dense treatise with in-depth analysis of dozens of cases—Rockefeller has given us a concise book that anyone can easily read. He doesn’t try to cover all the many erroneous doctrines of antitrust, but only to prove his thesis that “antitrust is not consistent with our aspirations for a rule of law.” And why is that? Rockefeller explains, “[A]ntitrust enforcement is arbitrary political regulation of commercial activity, not enforcement of a coherent set of rules.”

That is to say, antitrust is the rule of men, not of laws.

Coming back to the book’s title, Rockefeller argues that antitrust has all the trappings of a religion. It’s accepted as a matter of faith and is built around a number of myths.

The central myth is one blindly accepted by almost all educated Americans. They have heard that the evil Standard Oil Company had a virtual monopoly in the oil business, causing government authorities to break up the gigantic, dangerous firm. If you believe that, the rest of the antitrust catechism falls neatly into place: We need government officials to constantly monitor business activity and to stop the ever-present threat of monopoly.

Rockefeller shows that the accepted Standard Oil tale is as baseless as a Halloween scare story. During the time of Standard’s supposed market dominance, the price of refined petroleum products continually fell and competitors—yes, there were quite a few—steadily chipped away at Standard’s market share. There was no problem.

The antitrust religion thrives on false history and encourages confused thinking. True believers call for antitrust enforcement to prevent the kinds of competitive “injury” that is inevitable under capitalism. “Belief in antitrust,” Rockefeller writes, “is based on a kind of competition in which some win but none lose.”

But why does our author contend that antitrust is not really “law” at all? Because true law must be knowable so people can adjust their behavior in order to avoid legal difficulties. Antitrust, however, is so vague that people can never be certain that they won’t be prosecuted for “attempted monopolization” whenever they compete vigorously. The rule of antitrust authorities is like that of a capricious dictator.

Rockefeller is absolutely correct that antitrust is not compatible with the rule of law. It was America’s first instance of law so vaguely written that people didn’t know what it meant. Unfortunately, since then it has been joined by others, as politicians enact legislation that in effect says to bureaucrats and judges, “Here are a few broad objectives—now you figure out what to do to achieve them.”

Despite his solid case that antitrust is wasteful and counterproductive, Rockefeller holds out no hope that we will escape from its clutches. The religion is just too deeply ingrained, and opinion leaders see it as a component of “social justice.” And even if we somehow repealed the antitrust statutes starting with the Sherman Act, that might make things worse because of the existence of the Federal Trade Commission, which has been invested with broad, open-ended powers to regulate business “for the public interest.” That’s just as vague as a statute that makes it illegal to “attempt to monopolize.”

The only way to root out the antitrust religion is to teach people the truth about capitalism.

George Leef is book review editor of The Freeman.

by Clint Bolick

Cato Institute • 2007 • 177 pages • $11.95 paperback

Reviewed by George C. Leef

In recent years “judicial activism” has been assailed from both ends of the political spectrum. Conservatives complain about “liberal” activism when courts strike down laws they favor, and “liberals” complain about conservative activism when judges interfere with any of their schemes for controlling society. Can anything be said in its defense?

Emphatically, yes, answers Clint Bolick in David’s Hammer. Bolick, a veteran constitutional lawyer, contends that there is good judicial activism and bad judicial activism. The book is his attempt to sort the two out and explain why the good variety is important to a free society. He’s right on target in saying, “With the explosive growth of government at every level and the concomitant erosion of liberty, what we really have to fear from the courts is not too much judicial activism, but too little.”

Bolick argues that the Constitution meant for courts to assume an “activist” stance to protect the people’s liberties against incursions by the other branches of government. Both the liberal and conservative critiques of judicial activism, unfortunately, amount to nothing more than unprincipled sniping at the courts for interfering with statutes and regulations they like. As an antidote to unprincipled activism (and its equally bad twin, inactivism), Bolick advocates five general rules for judges:

• Carefully review all contested actions by federal, state, and local governments that implicate individual liberty.
• Evaluate laws with a presumption that liberty should be preserved.
• Remember that the Constitution enumerates the proper sphere of government power, so if there is no legal basis for an exercise of power, it is void.
• Read the Constitution so as to give meaning to every word.
• Don’t exercise legislative or executive powers.

Most of the book is devoted to cases Bolick has litigated that illustrate his philosophy about judicial activism. He begins with an excellent example, the case of Juanita Swedenburg. She grew grapes and made wine in Virginia and wished to be able to sell her products to customers around the country. The trouble was that many states had laws prohibiting interstate shipments of wine. Vintners like Swedenburg couldn’t sell in New York unless they established a “physical presence” in the state, but doing that would be far too costly for small sellers. But why should they have to? Why should state borders and anticompetitive laws get in the way of commerce?

Bolick fought the case tooth and nail, battling an array of interest groups that wanted to see the law upheld. He won in district court, but lost on appeal in the Second Circuit. Fortunately, the Supreme Court took an activist approach. In a 5–4 decision, it struck down state laws against out-of-state wine shipments, observing that they “deprive citizens of their right to have access to the markets of other states on equal terms.” This was laudable activism.

Another chapter covers the heated issue of eminent domain and gives us an inside look at a case that went against liberty, the infamous Kelo v. New London, Connecticut. Kelo resulted from the city’s effort to seize the home of Suzette Kelo as part of a redevelopment project centered on a Pfizer Corporation office complex. Here is where Bolick’s point about the need for judges to carefully read the Constitution is especially important. The Fifth Amendment states that government may use eminent domain to take property for public use. Unfortunately, the Court has decided to read that as meaning public benefit, so all politicians need to do is to say that the proposed use of land will in some way benefit “the public.” Mostly that means the new owner will “pay higher taxes.”

Kelo turned out badly, with the Court choosing to defer to the whims of local authorities. It was judicial inactivism.

Bolick has also been busy fighting laws that stifle people’s freedom to enter into businesses and trades. He tells us, for instance, about Leroy Jones, who wanted to start a taxi company in Denver. He planned mainly to serve a minority section where residents often found it hard to get a cab from any of the three existing companies. Why couldn’t Jones just go ahead? Answer: it’s illegal to provide taxi service without having a “certificate of public convenience and necessity” from the Public Utilities Commission. The commission wouldn’t issue the certificate unless Jones could somehow prove that the existing companies were unable to serve the area.

Bolick fought for Jones in court, but lost. More judicial inactivism. Freedom remains squashed.

This book should make you angry. The American colonists rebelled against much less, but today’s petty tyrannies elicit only yawns from many judges.

George Leef is book review editor of The Freeman.

The Best-Laid Plans: How Government Planning Harms Your Quality of Life, Your Pocketbook, and Your Future

by Randal O’Toole

Cato Institute • 2007 • 355 pages • $22.95

Reviewed by Gary M. Galles

In The Best-Laid Plans, policy analyst Randal O’Toole offers a well-documented case for why many government plans should be laid to rest. Its opening captures the central issue: “Somewhere in the United States today, government officials are writing a plan that will profoundly affect other people’s lives, incomes, and property. . . . [T]he plan will go horribly wrong. The costs will be far higher than anticipated, the benefits will prove far smaller, and various unintended consequences will turn out to be worse than even the plan’s critics predicted.”

O’Toole locates planning’s failures in the challenging gauntlet that stands between planning and success, and which “almost always leads to disaster because . . . the task is too big for anyone to understand and the planning process is too slow to keep up with the realities of modern life. . . . [M]ost of the professionals who call themselves planners are poorly trained to do the work they set out to do. Even if scientific planning were possible and the right people were doing it . . . politics inevitably distort the results into something totally irrational.”

Further, he traces planning’s problems to the “disparity . . . between how planners think people should live and how people really live.” Consequently, “[b]y failing to ask the right questions, planners end up with a totally wrong-headed view of urban problems. . . . In too many cases, the plans become a source of oppression instead of a way for people to improve their lives and their regions.”

O’Toole relies heavily on two of F. A. Hayek’s major themes. First, because central planning, unlike markets, cannot effectively use the valuable details of time and place that only some people know, its results will be inherently inefficient. Second, the problems caused by one government intervention lead to other interventions, resulting in an ever-growing encroachment on voluntary arrangements. These difficulties, plus those caused by the perverse incentives facing the political players involved, form the core of O’Toole’s argument.

The author fills an important gap. Few people have thoroughly studied such a broad field as planning, largely because the number of different situations and the variety of interacting federal, state, and local programs are so overwhelming. Only someone who has devoted much of his life studying these areas could accumulate the knowledge for this book. We profit from O’Toole’s investment.

The book must walk a fine line, however. He must get down to the details to see where the devil lurks—for example, because cities must repay federal funds on any abandoned rail project, even grotesquely inefficient projects are never admitted to be failures—without overwhelming the reader. The author does a good job in that regard, although the forest-planning section, which involves his greatest expertise, may be too complicated for many readers.

I found O’Toole’s treatment of “smart growth” planning blunders particularly valuable. He offers useful discussions of how “smart growth” sharply increases housing prices, with regressive effects, and increases housing-price volatility; of planners’ ill-considered assaults on cul-de-sacs; of how traffic-calming measures cost rather than save lives; of the bogus “we can’t build our way out of congestion” attacks on freeway construction; of the misunderstanding behind pedestrian malls; of how urban renewal and mass transit were just special-interest politics, and much more.

O’Toole recognizes that so-called market failures are usually government failures, especially when the law makes it impossible for people to defend or sell their property. He also fleshes out why free markets can do nearly everything government planning does, but better and without resorting to coercion.

The Best-Laid Plans does an admirable job of dissecting the reasons for the failures of government planning. Its emphasis on replacing planning with markets is dead-on. The guidelines it offers for reforming government agencies, “minimizing the pitfalls of comprehensive, politically driven planning,” are also useful, were they to be followed. Unfortunately, while O’Toole’s proposals would advance Americans’ well-being, by themselves they are not sufficient to overcome the special interests and “more for me” political pressures that created the increasingly dystopian planning results we now endure. That will take not only widespread knowledge of government failures and of the potential for market successes, but also a far more widespread commitment to liberty on the part of Americans.

Gary Galles is a professor of economics at Pepperdine University.

Bulldozed: “Kelo,” Eminent Domain, and the American Lust for Land

by Carla T. Main

Encounter Books • 2007 • 304 pages • $27.95

Reviewed by Steven Greenhut

Whenever local governments use eminent domain to acquire someone’s property, they downplay the nature of what they are taking. Officials send in their hired appraisers, who undervalue the property, but that’s not what I’m referring to here. Governments always treat the property as a mere piece of real estate. They never acknowledge that they are bulldozing the hopes, dreams, and life’s work of a person or family. They never recognize they cause irreparable harm by demolishing an intricate network of social relationships. Victims of eminent domain tell me that when city governments look at businesses, they have no idea how much work and foresight go into meeting payrolls or planning for the future. Officials see only the buildings, never the enterprise or emotions behind them.

That’s not surprising. Government is about power, and those who exert power don’t usually care about the victims. City planners prattle about the importance of architecture, streetscapes, and other design elements in uplifting the human spirit. They talk that way mostly when they are promoting some new scheme, such as the common redevelopment plans to remake the downtowns of older cities or suburbs into pedestrian-friendly locales. Yet these same officials ignore how their planning schemes destroy the human spirit.

Carla Main captures that truth in her book, the subtitle of which refers to the U.S. Supreme Court’s 2005 decision, Kelo v. New London, upholding the power of cities to use eminent domain for economic development. Main provides a detailed story of one Texas family’s fight against city hall to save its waterfront property and the seafood business that took generations to build. It’s a painful story—one I struggled to read, given that I’ve written about many families who have gone through similar experiences. City officials use their powers to declare a thriving business blighted, then take it away through a bitter legal process, and finally hand it over to someone else—a politically favored developer promising tax benefits and growth to the city. The victims always have a sense of disbelief. In this case, officials wanted to build a yacht marina.

Main’s book artfully portrays what a piece of property means to a particular family, the Gores. She intertwines broader themes, but it’s the family’s story that’s so compelling, an example of what Mindy Fullilove calls “Root Shock.”

Main also readably tells the legal history of how eminent domain has changed from an exception for “public use” to a doctrine under which government can take whatever it pleases and give it to whomever it chooses. Main writes that the 1954 U.S. Supreme Court decision in Berman v. Parker, which allowed the government to use eminent domain to clean up a Washington, D.C., slum, “was a turning point in the history of American property rights . . . because it christened the great mother ship of urban renewal, allowing eminent domain to set sail over the American landscape and pick up passengers who were like devotees of a new municipal religion.”

That’s exactly right. As that passage suggests, Main occasionally indulges in overwriting and sometimes veers into an over-folksy manner, but those are minor flaws. Main puts the focus of eminent domain where it needs to go—on the effects of takings on the lives of those victimized by this abusive government power. Most Americans are not fully aware of what’s at stake. Anyone who takes the time to read this book will understand that the post-Kelo debate is not really about property but about the right of ordinary Americans to pursue their lives and dreams, regardless of the designs of government planners.

Steven Greenhut is a columnist at the Orange County Register and author of Abuse of Power: How the Government Misuses Eminent Domain (2004).

Health Care at Risk: A Critique of the Consumer-Driven Movement

by Timothy Stoltzfus Jost

Duke University Press • 2007 • 265 pages • $22.95

Reviewed by Diana M. Ernst

Timothy Stoltzfus Jost doesn’t know what consumer-driven health care (CDHC) might bring, but he is afraid of it. That dialectic drives his book, Health Care at Risk: A Critique of the Consumer-Driven Movement, a defense of government-monopoly medicine, or what Jost hails as “solidarity based” health care.

Jost is a professor of law at Washington and Lee University, and his health-care proposal includes an expansion of federal health insurance, supplemented by private insurers that are prohibited from evaluating health risk and offering plans that don’t cover routine expenses.

As for CDHC—a combination of direct consumer payment for routine medical expenses plus high-deductible insurance—Jost claims it failed the first time around. The fallacy is that he evaluates the current consumer-driven health-care effort against a consumer model of the 1920s, before insurance and other innovations. Back then, even when costs were much lower, people with major illnesses were unlikely to have saved enough money to pay for treatment. Today’s CDHC endeavor is vastly different, however, based on modern insurance theory and social and medical norms that demand innovative, high quality, and often expensive health services.

The famous 1970s RAND health-insurance experiment shouldn’t be taken as gospel, but the study did show that putting more dollars under patients’ direct control worked for middle-class participants at no harm to their health. As for the poor, today’s CDHC advocates propose reducing prices and increasing quality through competition, supplemented by tax credits to ensure that they have the broadest choice of health care possible.

“If ‘consumer-driven health care’ were advertised as a proposal to shift the weight of health care spending from healthy Americans to the shoulders of the chronically ill, it would probably not sell,” says Jost. True, but that isn’t what CDHC proposes. He notes, but fears, the positive impact of consumer-driven health care to date. Patients who control more of their health-care dollars are using doctors and emergency rooms less often, and more Americans are switching to generic drugs. Enrollees are searching for information on doctors. Patients are following treatments for chronic illness and not forgoing preventive care. Jost admits that these truths indicate cost savings in the long term, but declares, “But we must not just look at positive effects of CDHC, however, but also at its potential problems.” This is the bulk of his harangue.

Why are CDHC advocates more critical of “solidarity based” health systems than of the American status quo? Jost answers his own question when he owns up to the troubles with “solidarity based” delivery: poor access, long waiting lists, and obsolete technology, with rapid care for ruling politicians and high incomes for powerful health-care interests. He laments that the poor in the United States face barriers to health care, but in none of his favored “solidarity based” systems are the poor likely to be as healthy as the affluent.

Americans’ support for “solidarity based” systems deteriorates under the weight of the very facts Jost cites. He concedes that humankind’s common experience is to respond to financial incentives and that we are more productive and creative when we enjoy the fruits of our labor. However, he still rejects markets as the best method to distribute goods, and he fears society’s recognition of individual interests.

We don’t have sufficient information to make choices that reflect our preferences, Jost writes, but even if we had perfect information, “it wouldn’t be possible for the human mind to absorb and process it all.” He expresses distaste for economic freedom and wealth—the money we could spend on health care, he says, we waste on toys, SUVs, and exotic coffee. But even he knows that the alternative is worse: “[G]overnments seldom increase the efficiency of markets and are often unproductive, if not corrupt.”

It’s not a panacea, but the facts look good for CDHC. According to recent reports, health-savings accounts and the corresponding high-deductible health plans are gaining popularity among Americans of all ages, education, and income levels. Consumers are becoming more knowledgeable about medical services and products. Patients are enjoying more control of their health care and relying less on third parties for payment. That will change providers’ behavior and reduce the bureaucratic costs that waste so much money today. Freedom produces good results.

CDHC advocates do not believe in taking health-care dollars away from Americans and delivering them to unaccountable bureaucracies. They do believe that this money should be returned to patients, on the basis that patients can indeed make choices. Jost fundamentally distrusts not only competition, but each individual’s capacity to be free. Those who cherish their freedom—and their health—should be wary of Health Care at Risk.

Diana Ernst is Health Care Policy Fellow at Pacific Research Institute.

The first and probably the most important subsidy of history is land theft, by which peasant majorities were deprived of their just property rights and turned into tenants forced to pay rent based on the artificial “property” titles of state-privileged elites.

Of course, all such artificial titles not founded on appropriation by individual labor are completely illegitimate.

As Ludwig von Mises pointed out in Socialism, the normal functioning of the market never results in a state of affairs in which most of the land of a country is “owned” by a tiny class of absentee landlords and the peasant majority pay rent for the land they work. Wherever it is found, it is the result of past coercion and robbery.

Murray Rothbard, in The Ethics of Liberty, explained the injustice of feudal landlordism:

But suppose that centuries ago, Smith was tilling the soil and therefore legitimately owning the land; and then that Jones came along and settled down near Smith, claiming by use of coercion the title to Smith’s land, and extracting payment or “rent” from Smith for the privilege of continuing to till the soil. Suppose that now, centuries later, Smith’s descendants (or, for that matter, other unrelated families) are now tilling the soil, while Jones’s descendants, or those who purchased their claims, still continue to exact tribute from the modern tillers.Where is the true property right in such a case? It should be clear that here . . . we have a case of continuing aggression against the true owners—the true possessors—of the land, the tillers, or peasants, by the illegitimate owner, the man whose original and continuing claim to the land and its fruits has come from coercion and violence. Just as the original Jones was a continuing aggressor against the original Smith, so the modern peasants are being aggressed against by the modern holder of the Jones-derived land title. In this case of what we might call “feudalism” or “land monopoly,” the feudal or monopolist landlords have no legitimate claim to the property. The current “tenants,” or peasants, should be the absolute owners of their property, and, as in the case of slavery, the land titles should be transferred to the peasants, without compensation to the monopoly landlords.

So rather than defending all existing land titles in the name of the “sanctity of property” and protesting when some left-wing government institutes a land reform that transfers feudal land titles to the peasantry, Rothbard favored 1) dividing up Southern plantations and giving freed American slaves “forty acres and a mule,” and 2) transferring the latifundia from Latin American landed oligarchies to the peasants.

In the Old World, especially Britain (where the Industrial Revolution began), the expropriation of the peasant majority by a politically dominant landed oligarchy took place over several centuries in the late medieval and early modern period. It began with the enclosure of the open fields in the late Middle Ages. Under the Tudors, Church fiefdoms (especially monastic lands) were expropriated by the state and distributed among the landed aristocracy. The new “owners” evicted or rack-rented the peasants.

Expropriating from the Peasantry

The Restoration Parliament of the seventeenth century carried out a series of land “reforms” that abolished feudal land tenure altogether—but only upward. There were two ways Parliament could have abolished feudalism and reformed property. It might have treated the customary possessive rights of the peasantry as genuine title to property in the modern sense, and then abolished their rents. But what it actually did, instead, was to treat the artificial “property rights” of the landed aristocracy, in feudal legal theory, as real property rights in the modern sense; the landed classes were given full legal title, and the peasants were transformed into tenants at will with no customary restriction on the rents that could be charged. The most important component of this “reform” was the Statute of Frauds of 1677, which nullified rights of copyhold by making them unenforceable in royal courts.

Finally, the Parliamentary Enclosures of the eighteenth and early nineteenth century robbed the peasantry of their rights of common. The propertied classes of England saw the economic independence provided by the commons as a threat, first to an adequate supply of agricultural wage labor on the landed oligarchy’s own land, and later to an adequate supply of factory labor willing to work the long hours and low pay demanded by the owners. The literature of the propertied classes of the time was quite explicit on their motivation: the laboring classes would not work hard enough or cheaply enough so long as they had independent access to the means of subsistence. They had to be made as poor and hungry as possible so that they would be willing to accept work on whatever terms it was offered.

A version of the same phenomenon took place in the Third World. In European colonies where a large native peasantry already lived, states sometimes granted quasi-feudal titles to landed elites to collect rent from those already living on and cultivating the land; a good example is latifundismo, which prevails in Latin America to the present day. Another example is British East Africa. The most fertile 20 percent of Kenya was stolen by the colonial authorities, and the native peasantry evicted, so the land could be used for cash-crop farming by white settlers (using the labor of the evicted peasantry, of course, to work their own former land). As for those who remained on their own land, they were “encouraged” to enter the wage-labor market by a stiff poll tax that had to be paid in cash. Multiply these examples by a hundred and you get a bare hint of the sheer scale of robbery over the past 500 years.

Contrary to Mises’s rosy version of the Industrial Revolution in Human Action, factory owners were not innocent in all of this. Mises claimed that the capital investments on which the factory system was built came largely from hard-working and thrifty workmen who saved their own earnings as investment capital. In fact, however, they were junior partners of the landed elites, with much of their investment capital coming either from the Whig landed oligarchy or from the overseas fruits of mercantilism, slavery, and colonialism.

In addition, factory employers depended on harsh authoritarian measures by the government to keep labor under control and reduce its bargaining power. In England the Laws of Settlement acted as a sort of internal passport system, preventing workers from traveling outside the parish of their birth without government permission. Thus workers were prevented from “voting with their feet” in search of better-paying jobs. You might think this would have worked to the disadvantage of employers in underpopulated areas, like Manchester and other areas of the industrial north. But never fear: the state came to the employers’ rescue. Because workers were forbidden to migrate on their own in search of better pay, employers were freed from the necessity of offering high enough wages to attract free agents; instead, they were able to “hire” workers auctioned off by the parish Poor Law authorities on terms set by collusion between the authorities and employers.

Legalized Discrimination Against Laborers

The Combination Laws, which prevented workers from freely associating to bargain with employers, were enforced entirely by administrative law without any protections of common-law due process. And they were only enforced against combination by workers, not against combination by employers (such as blacklisting “troublemakers” and collusive setting of wages). The Riot Act (1714) and other police-state legislation during the Napoleonic Wars were used to stem the threat of domestic revolution, essentially turning the English working class into an occupied enemy population. Such legislation criminalized most forms of association.

Even fraternal associations for mutual aid, burial and sick benefits, and the like operated in the face of hostility from the state, according to historians of the friendly-society movement such as Bob James and Peter Gray. Under the terms of the Combination Act, friendly societies were subjected to close judicial supervision lest direct craft production be organized for barter among the unemployed, or the societies’ benefits cross the line and function as de facto unemployment insurance for striking workers. The Corresponding Societies Act, passed around the same time, prohibited all societies that administered secret oaths or were federated on a national scale.

So the Industrial Revolution was, in fact, built on a system of legal peonage in which employers were directly implicated. The form taken by the factory system surely reflects this history. In a Britain composed of peasant smallholders, with no restraints on free association, workers would have been free to mobilize their own properties as capital through mutual credit institutions. Absentee ownership and hierarchy would likely have been far, far less prevalent, and the factory system where it existed far less oppressive and authoritarian.

A similar process occurred in the colonization of settler societies like America and Australia, by which the colonial powers and their landed elites attempted to replicate feudal patterns of property ownership. In such colonies, the state preempted ownership of vacant land and restricted working people’s access to it. Sometimes they gave title to vacant land to privileged land speculators, who were able to charge rent to those who homesteaded it (the legitimate owners).

E. G. Wakefield, an early nineteenth-century British theorist of colonialism, advocated just such preemption on the same grounds that the propertied and employing classes of Britain had supported Enclosure: it was easier to hire labor on favorable terms to the employer. In England and America, he wrote:

In colonies, labourers for hire are scarce. The scarcity of labourers for hire is the universal complaint of colonies. It is the one cause, both of the high wages which put the colonial labourer at his ease, and of the exorbitant wages which sometimes harass the capitalist. . . .

Where land is cheap and all men are free, where every one who so pleases can obtain a piece of land for himself, not only is labour very dear, as respects the labourers’ share of the product, but the difficulty is to obtain combined labour at any price.

Consequently, “[f]ew, even of those whose lives are unusually long, can accumulate great masses of wealth.”

Wakefield’s disciple, Thomas Merivale, wrote of the “urgent desire for cheaper and more subservient labourers—for a class to whom the capitalist might dictate terms, instead of being dictated to by them.”

Land preemption was a major element of colonial policy in early American history. Gary Nash, in Class and Society in Early America, described land grants in colonial America comparable to those of William I in England after the Conquest. In New York, for example, the largest estates granted by the British colonial administration (after the New Netherlands was acquired in the Dutch Wars) ranged from the hundreds of thousands to over a million acres. Governors continued to grant tracts of land in the hundreds of thousands of acres to their favorites, well into the eighteenth century. Under Governor Fletcher, some three-quarters of available land was granted to 30 persons.

Albert Jay Nock, in Our Enemy, the State, argued that “from the time of the first colonial settlement to the present day, America has been regarded as a practically limitless field for speculation in rental values.” Many leading figures in the late colonial and early republican period were prominent investors in the great land companies, including George Washington in the Ohio, Mississippi, and Potomac Companies; Patrick Henry in the Yazoo Company; Benjamin Franklin in the Vandalia Company, and so forth.

In The Ethics of Liberty, Rothbard condemned such preemption (“land-engrossing, where arbitrary claims to virgin land are used to keep first-transformers out of that land”) on the same grounds that he criticized feudal landlordism. He called for voiding all current titles to vacant and unimproved land, and opening it up to free homesteading. In addition, in cases where current mortgage holders and landlords trace their title to state grants of land, the proper claim lies with those who first homesteaded the land, or their heirs and assigns.

The Homestead Act of 1862, an apparent exception to this general trend, was really just another illustration of it. The majority of land, rather than being claimed under the terms of the Homestead Act, was auctioned to the highest bidder. Even for land covered by the Act, according to Howard Zinn, the $200 fee was beyond the reach of many. As a result, much of the land was not homesteaded on Lockean principles at all, but initially went to speculators before being partitioned and resold to homesteaders. And compared to the 50 million acres covered by homestead legislation, 100 million acres were given away as railroad land grants during the Civil War—free of charge! In other words, the privileged classes got the gravy, and ordinary homesteaders got the bone.

Keeping the System Going

What I have described here are only the initial acts of coercion and robbery on which our existing form of industrial capitalism was founded. Of course it didn’t stop there. Once the system was up and running, it depended on the state’s ongoing efforts to maintain a legal structure of privilege, based on artificial property rights and artificial scarcity: enforcement of absentee titles to vacant and unimproved land; entry barriers for the banking industry to make credit artificially expensive and scarce; the artificial property rights of patent and copyright; and more. And starting in the late nineteenth century the modern form of corporate capitalism depended on even more massive state intervention: subsidies to long-distance shipping to make market areas and firm size artificially large; the cartelizing effects of patents and tariffs; regulatory cartelization; and entire industries and sectors of the economy either brought into existence or guaranteed a taxpayer-funded market by the post-1941 perpetual war economy.

Contrary to popular mythology, the New Deal was not a departure from some preexisting idyllic state of “laissez faire.” There never was anything remotely approaching laissez faire. Capitalism—that is, the existing historical system as it actually developed—has had very little to do with free markets and a great deal to do with robbery and coercion.

This is not to say that all avenues to economic advancement through independent entrepreneurship have been closed off. But it’s much more of an uphill struggle than it would be in a free market, and the field is unfairly tilted in favor of the big players.

In seeking to institute a genuine free market, libertarians shouldn’t lose sight of these facts. What lessons are libertarians to learn from the previous historical account?

First, there is nothing “libertarian” about the instinctive tendency to rally to the defense of existing property titles without regard to justice. As Karl Hess said in The Libertarian Forum, back in 1969,

[L]ibertarianism wants to advance principles of property but . . . it in no way wishes to defend. . . all property which now is called private. Much of that property is stolen. Much is of dubious title. All of it is deeply intertwined with an immoral, coercive state system which has condoned, built on, and profited from slavery; has expanded through and exploited a brutal and aggressive imperial and colonial foreign policy, and continues to hold the people in a roughly serf-master relationship to political-economic power concentrations.

Second, in advocating free-market reform, we must consider the role of this historical legacy of injustice (the subsidy of history) in determining the winners under the present system. A “free-market reform” that simply locks in the beneficiaries of past robbery and privilege, and ratifies the past theft from which they benefit, will merely reward injustice and secure its ill-gotten gains.

From a libertarian ethical standpoint, the standard model of “privatization” (selling off state property to a large, politically connected private corporation, on terms most advantageous to the corporation) is therefore highly dubious. That’s especially true considering that much of the property was created in the first place—at taxpayer expense—for the primary purpose of subsidizing the operating costs of big business. Much of the state-owned utility and transportation infrastructure in the Third World was created, at the behest of transnational financial elites, as a precondition for profitable Western capital investment. And the odious debt thus incurred, often by corrupt dictatorships acting in collusion with global finance, is then used by the World Bank to blackmail those countries into selling off their infrastructure to the very same transnational corporations it was created to benefit—usually at pennies on the dollar.

An Appropriate Model for Privatization

Rothbard’s model of privatization is far superior: to void state titles to property and treat it as unowned, subject to immediate homesteading by those actually mixing their labor with it. That would mean that state universities would be transformed into the property of their students or faculty, as consumer or producer cooperatives. Government-owned utilities would become consumer cooperatives owned by ratepayers, and state-owned factories would be handed over to the work force and reorganized as worker cooperatives.

We must also be wary of pseudo-Coasean arguments that it “doesn’t matter” who the property was originally stolen from, because it will end up in the hands of the “most efficient” owner. That’s essentially the same argument used for eminent domain. Regardless of whose hands the property winds up in, the rightful owners and their descendants—who never received compensation—are out the value of what was stolen from them. And even the most inefficient ways of organizing production are pretty “efficient,” comparatively speaking, when you have the competitive advantage of working with stolen property.

Besides, there is no such thing as generic “efficiency”; efficiency depends on the owner’s purpose. The most efficient technique for subsistence farming on a small plot—economizing on land by building soil and adding intensive labor inputs—is entirely different from that for a feudal oligarch producing cash crops with access to more stolen land than he could possibly use, and often holding a majority of his stolen land out of use altogether. In any case, the rightful owner would no doubt find it far more “efficient” to be feeding himself on his own land, than starving in a shantytown because he can’t afford to buy even the cheapest food from those “efficient” plantations occupying his stolen land.

The actual system of political economy that so many corporate apologists refer to as “our free market system” has in fact been characterized from the beginning by robbery. We must beware of “free market reforms” carried out by the robbers. They amount in practice to allowing the robbers—hands still full of loot—to say: “All right, no more stealing, starting . . . now!”