How to make a good economy without taxes so that the whole economy is from the market?

Zxcutehikka

This is an interesting question. I suspect the author of the question wants a statist answer: how to build a good economy from scratch, having come to power in some state. There are several quite decent examples in recent history, such as Kakha Bendukidze’s reform of the Georgian economy or Argentina’s economy – under Javier Milei. What unites these cases, and more classical examples of economic miracles – Western German, Japanese, South Korean, Singaporean and so on?

Primarily, it’s that the economies in these countries were completely wrecked before the reforms began. Only when the horse was dead would the bureaucratic horde graciously agree to dismount and say, “Well, alright, reform us, don’t interfere with me, but only weakly, and as soon as the horse gallops again, of course, my time will come, and I’ll push you aside.” And then the reformer more or less carefully dismantled regulatory blockages, allowing the economy to breathe.

Perhaps the only example of an economic miracle that didn’t involve any reforms comes to mind: Hong Kong. There, according to reports, the governor simply sabotaged metropolitan policy and didn’t interfere much with what was happening in the local economy for a long time. And then the metropolis simply handed over Hong Kong to the Chinese socialists.

The path of Hong Kong is just what anyone can use, not only the chosen or unchosen politicians. The business is simple – you just need to ignore government directives and deal with your private affairs. If no one will pay taxes, we’ll get a tax-free economy, which, incidentally, is what the questioner is interested in. Of course, the modern state knows how to cope without taxes. For example, it could simply print money and finance its needs from this source. So it would be good to ignore government funds too.

The problem, however, is that mass ignoring of official wishes doesn’t begin until people realize that the state has botched things. And therefore, at the start of the economy, we have ruins. Worse than that, the level of economic literacy among people at the start is probably shockingly low – otherwise how did our economy end up in ruins? Why “presumably”? Because there’s a more favorable alternative: people are generally more or less literate, and the economy is ruined, for example, by war and economic sanctions. And this is why Russia has a better chance of achieving economic prosperity after forcibly displacing the current government than Cuba or Venezuela.

And the fact is, even if the Venezuelan government is now crushed by the US Army, there’s probably not much good that will come of it – because the local socialists will be convinced they were right all along, it was just a force majeure situation, and now let’s fix our wonderful Bolivarian socialism. Where do I get this certainty? Well, there’s the precedent of Iraq: an external overthrow of a socialist government doesn’t allow the people to become smarter; instead, the people become enraged.

The answer came out sprawling – more like rambling thoughts than a coherent lecture – and political studies isn’t really my forte. But somehow I managed to look at the topic from several angles, and that’s enough bread.

Dignity for the herd, honor for personalities

Bitarch and the Voluntarist claim that of the two cultural models of behavior—honor and dignity—the second is more attractive to libertarians, as the first is collectivist and the second is individualistic.

Let us use the same definitions. In a culture of honor, a person’s standing is determined by how much their behavior conforms to certain high standards. In a culture of dignity, a person is valuable by the mere fact of belonging to humanity.

From this, it is easy to draw both the conclusions of the article and the exact opposite: honor is about individualism, since a person defends their own honor or chooses dishonor; dignity, however, is a collectivist thing, since only collective trends will determine what offends human dignity and what does not. Other people within a “culture of dignity” may turn out to be so valuable that any sidelong glance would humiliate their dignity, and the law would punish this, for example, with imprisonment for “inciting hatred.”

If today a person chooses to rely on the protection of an impersonal law instead of individual action, then tomorrow that same law will strip them of their dignity, and the person will have already lost the capacity for individual action in the previous step.

What is the culture of honor based on? On the fact that a person is always ready to demonstrate their willingness to defend themselves against the encroachments of others, and thereby avoids the need to repeat this again and again. Others see the readiness to repel and are wary of infringing upon another’s honor. Of course, the concept of honor is broader than the readiness for violence, but in the article under discussion, it is reduced only to this, so we will not expand the topic unnecessarily.

And what is a culture of dignity, if described in the language of a culture of honor? It is the presumption that everyone can defend their honor. I do not know if every person I meet is truly a person of honor. But I will assume this and base my behavior on it. Therefore, I will not encroach upon what is dear to them, knowing that their honor commands them to defend it. They are worthy of this. In other words, dignity grows out of honor. It limits honor, but does not deny it.

Bitarch and the Voluntarist propose to cast aside honor in favor of dignity. They want to deprive a person of the right to forcefully defend what is dear to them, while hoping that the law will be observed in a culture of dignity. But they forget to remind us that the law can become anything. A society with dignified laws (referring not to written norms, but to the actual practice of their application) will preserve a culture of dignity. A society with undignified laws will lose it. But what will compel people to fight for dignified laws and against undignified ones? Honor, of course!

To summarize. In reality, we are talking about the same thing. Respect for the values of the individual is important for building a prosperous society. But we do not agree on the means. If the NAP is reduced only to the refusal to initiate direct violence, then an encroachment on another’s freedom can bypass the NAP through indirect methods. This is exactly why the capacity for proactive violence cannot be taken away from a person. Without this capacity, a person will be unable to resist their own enslavement. Bitarch and the Voluntarist are developing mechanisms to strengthen the inhibitor of violence. If their means worked, it would make me their enemy. Fortunately, they work only on paper.

Stephan Molynieux, Practical Anarchy, translation of chapter 27 of 29

In recent days, I have experienced a considerable slump in energy, so I’ve accumulated a backlog of texts. The weather outside has noticeably improved now, and I hope to shorten this queue a bit. But first, I am publishing the final version of the translation of Chapter 27 of Stephan Molinari’s “Practical Anarchy,” simply because this work required less creative effort. The chapter is devoted to describing the system of incentives that a market stateless society is capable of creating to encourage good child-rearing and, accordingly, punishment for bad parenting.

The main flaw of the text, of course, is the complete omission of the fact that children and their parents share a common budget. The greater the financial sanctions against the parents, the less money can technically reach the child. At some point, the ubiquitous representative of the PRS must appear on the doorstep of a problematic parent and announce that since the parent cannot pay the increased insurance, they can, of course, waive the policy entirely, but then neither they nor their child will be allowed to set foot in any decent place (I won’t recount it; the logic is roughly the same as in Chapter 25 regarding stateless prisons). But the parent can also sign a waiver of parental rights, and lo and behold, we have a list of people wishing to acquire such rights here; would you like to review their offers? If you do not sell your rights today, their value will be lower tomorrow, because in all the ratings, your child will be considered more and more problematic. Think about it. After which, the PRS representative vanishes in a cloud of smoke with a demonic laugh.

Of course, the PRS will be financially interested in ensuring that various marginals go bankrupt paying increased rates on contracts with the PRS, and subsequently, by hook or by crook, hand over their children to well-bred and wealthy members of society, who will not create problems for those around them, but, more importantly, will be able to further financially motivate the PRS inspector to pay particularly close attention to a specific problematic family. The more people there are wishing to acquire a child at as early an age as possible, the higher the financial incentives for the PRS to introduce the strictest possible rules, the violation of which will trigger a chain ending in the financial collapse of the family and separation from the child.

How did it happen that Molinari prefers not to write about the extortion aimed at taking children away from parents deemed problematic? Because he is a conservative, he is categorically against state juvenile justice, and for him, the raising of children by the parents themselves is a value of very high order. But market logic couldn’t care less about the values of a specific Stephan Molinari.

About One Objection to Panarchy

Here, Georgiy Freeman made an interesting observation about panarchy:

The problem with panarchy as an optimal world order, in my view, lies in the realm of human psychology. It’s predictable that liberal jurisdictions will be more economically successful and materially wealthier than socialist ones. And it will inevitably happen what has already occurred in the world with closed sub-communities like Jewish groups. Unsuccessful, impoverished extraterritorial jurisdictions will invariably blame wealthy liberal jurisdictions for their misfortune: “they parasitize us,” “they rob us,” “they live off our backs.” And this will inevitably lead to irrational conflicts, wars and pogroms. And ultimately, to the destruction of the ECU and panarchy as an idea.

The problem with panarchy as an optimal world order, in my view, lies in the realm of human psychology. It’s predictable that liberal jurisdictions will be more economically successful and materially wealthier than socialist ones. And it will inevitably happen what has already occurred in the world with closed sub-communities like Jewish groups. Unsuccessful, impoverished extraterritorial jurisdictions will invariably blame wealthy liberal jurisdictions for their misfortune: “they parasitize us,” “they rob us,” “they live off our backs.” And this will inevitably lead to irrational conflicts, wars and pogroms. And ultimately, to the destruction of the ECU and panarchy as an idea.

Indeed, on the example of this assumption we see a fascinating phenomenon of human psychology. The answer to the expressed concern is already contained in the description of the concern itself, however it is ignored. “If people will walk down the streets, dressed festively and sending everyone to hell, then they will quickly encounter violence against them, so the institution of walking down the streets will soon be destroyed, as an idea.” But why not just not send everyone to hell.

Similarly, respected G. Freeman suggests paying attention to the disastrous fate of closed extraterritorial sub-entities and immediately prophesies the same fate for open sub-communities. A liberal extraterritorial jurisdiction is not a secret club with seven degrees of initiation, but simply clients of courts and other legal infrastructure working according to liberal norms, namely respect for freedom and private property. Any communist jurisdiction client can enter a liberal jurisdiction if, of course, the communist masters let him out, allocating his due share of public communist property. And if they don’t let him out, then claims will, presumably, not be directed at liberals.

The problem described by G. Frijman is quite typical of prosperous territorial communities with developed redistribution in favor of the poor: the poor, for some reason, strive to infiltrate such communities, and those who have already infiltrated them suddenly stop loving migrants and demand that borders be closed. Of course, after closing the borders, this territorial community begins to be perceived by many neighboring communists as a fattening on neighbors’ accounts, an education that is subject to destruction. However, until there is mandatory social support within this territorial community, there are no problems with migrants in it: they simply flood into it, hoping to earn a living, and many of them succeed.

Novemberish

I am currently experiencing a period of some confusion, I don’t know where to best apply my efforts. Not having a ready answer, I simply want to discuss this openly in the post, hoping something will occur to me during the process, and perhaps the readers will offer suggestions too.

Let’s briefly review the past. Since 2018, I have publicly been disseminating libertarian theory, while simultaneously mastering it and filling in gaps where I found them. Since 2021, the theory has become supplemented with practice, and we began building a libertarian community in Montenegro. In 2022 something happened, and respectable Russian emigrants became those upon whom it’s convenient to vent complexes. In 2024 something else happened, and anti-migrant rhetoric began to gain mainstream traction worldwide. At the close of 2025 in Montenegro we have preparations for government to sharply tighten conditions for foreign nationals’ legal stay and readiness of Russians to a mass exodus from the country towards Serbia primarily.

What should I personally do within this entire situation?

There’s a path that Montelibero is pursuing. It has re-qualified as an international movement and now manifests mainly online, with occasional offline activity shifting to Serbia, Georgia and Argentina. I’m already distanced from this movement, because it’s hard for me to understand what’s going on within it and what place makes sense for me to occupy.

There is a spontaneously emerging movement in Montenegro advocating for immigrant rights, covering today three diaspora: Russian, German and Turkish. This is new for me and quite insightful. Russians are still organized worse than everyone within this situational alliance, aside from the Serbs, of whom there are more in Montenegro, but they do not consider themselves true immigrants and possibly think that all these tightening conditions are not written for them. However, the movement attracts local citizens who realize that without immigrants, the country will be very difficult.

There is an obvious route – within about a year to relocate non-hurriedly to Serbia and settle there, and to cease all black Montenegrin activities. For me this means withdrawing previously made investments from Montenegro, finding funds for earning on a new place, forming a new community of communication and mutual assistance. The same could be done with Georgia, but learning Georgian after Serbian – it’s obviously a significant challenge.

In any case, my priorities have changed quite a bit. I don’t really feel like investing in online communities anymore because economic connections are more important than ideological ones. It doesn’t matter that there’s another powerful libertarian festival happening somewhere in New Hampshire, or another major conference in Prague, or another significant reform taking place in Argentina – it won’t directly benefit me. But a good auto mechanic will be useful to me, even if he doesn’t particularly understand praxisology. You need to be friends with him, drink kofu with him, jointly defend your rights and, where possible, bring him some benefit besides just paying for the service, because local communities are held together by exactly these kinds of mutual services.

And also, I need to remember that practice makes perfect, but generally speaking, my strongest trait is precisely the theoretical understanding of how the current world is structured, from a libertarian ideological perspective. These musings don’t feed me directly, but subjectively they seem most important to me. Are they in demand among channel readers? It’s hard to say.

A subscriber tossed in a topic for reflection

Written by Alexander Elitsur.

I am trying in every way to get through to our OLs with my idea of the PRB, but it’s not going very well. I specifically went to the Adam Smith readings, which you commented on so wonderfully, in order to meet someone at the afterparty. No one but Topolev was there, and even he was in a hurry, so we couldn’t really talk. I caught Kyneva after his speech, but it was also useless—a petty, spiteful, stubborn little shit. I’m not great with donations, but I hope you will read this and answer something. About the electoral system and about the concept of the PRB (Beautiful Republic of the Future😉) in general.

Read it. Answering something.

The author of the question proposes a rather detailed blueprint for the constitutional structure of Russia, asserting that something along these lines could quite well be implemented as soon as Putin kicks the bucket. In some ways, this echoes a recently published article for “Fronda” about democracy, where I point out that power must be carefully broken into small pieces, without granting anyone full authority, and the boundaries of powers must be made as clear as possible; however, this still won’t help, and a democratic republic is doomed to slide into tyranny—well, you all know these further banalities about watering the tree of Liberty and similar high agrarian technologies of the Ancients.

And now I want to talk about something else. It is possible and necessary to disagree with one another. It is foolish and unworthy to refuse to understand others. It is dangerous to oversimplify one’s understanding of others, although this certainly saves mental effort. Call Kyneva a spiteful shit, Bitarch a schizo-fascist, Svetov a pedophile—and the world becomes simple and orderly, except that such a picture of the world will be irrelevant. In it, all of a person’s actions end up subordinated to the label that has been slapped on them. One can also slap labels on entire nations; this is just frighteningly convenient. Let the Russians be orcs, the Ukrainians stupid peasants, the Serbs orcs, the Montenegrins stupid peasants, the Croats orcs, the Americans stupid peasants, the Chinese orcs… Well, in general, we have a huge wealth of labels; there is enough for everyone.

If a label has been slapped on you, it can be useful to turn to the other side so that another label is slapped on you; then at least some stereo appears, some volume, some space for discussion. If you are presenting your beautiful model of the Beautiful Mordor of the Future, and the listeners for some reason are not impressed, you can, for example, ask your interlocutor how they envision the desired structure of the future global concentration camp, and what they prefer on the menu: freedom of immigration or universal basic income? And if both, then what will we season it with: commodity shortages or hyperinflation? Or you could even avoid mocking the obvious flaws of the proposed model and, instead, speak of the overall picture respectfully, emphasizing that there is something in common between your visions of the world order, and why not start building a productive interaction around this common ground. For example, one could find some kinship between the proposed model of a federative Russian republic according to Elitsur and the Hoppean model of a thousand Liechtensteins, and, having highlighted the commonalities, start considering whether there are any fundamental disagreements between the models, or if it’s basically a matter of taste and one shouldn’t cling too tightly to the details.

In general, if one were to take an example of how a certain complex of ideas is spread, I like the experience of the Jesuits: those guys learned languages and learned to convey their concepts using the local cultural code. I love syncretism.

I apologize to the wide circle of readers for the somewhat rambling nature of this post—I simply do not understand the person I am answering well enough, so I am just sighting in.

Column for the Second Number of “Fronde”

Just submitted an article to the editorial board for the third issue of “Fronda”. And if that’s the case, why not make your own column from the second issue, dedicated to democracy, publicly available? Here it is, please enjoy:

Lessons of Freedom

Hello everyone, it’s Anka-tyan with you again, and today we’re talking about the lessons that a social structure like democracy gives us.

Lesson of Resolution

Ancient Greek democracy began with tyrannicides. Since then, killing a tyrant is considered good manners and a pretty decent prelude to establishing a more free political order. Most tyrants have drawn this lesson, so they try to maintain the outward appearance of democracy. Let’s draw the same lesson for ourselves:

The most direct way to establish democracy is to destroy the tyrant… Destroying an army or an economy is a much more roundabout and unreliable way. Negotiating with a tyrant about his peaceful departure is even less reliable.

Lesson of Vigilance

Fighting for democracy, people don’t want democracy itself. They want freedom from tyranny – that is, from a regime in which they are arbitrarily subjected to violence. Democracy is just a family of various compromise social structures designed to prevent a recurrence of tyranny. The common thing in all stable democracies is the principle of separation of powers. No one owns all power! Tyranny of the popular assembly is just as tyrannical as the tyranny of one person. Let’s formulate our lesson as follows:

Construct a system of self-government so that your community doesn’t give anyone the opportunity to seize power. No expansive interpretations of norms! No extraordinary powers! Any holder of power is a potential tyrant. Be vigilant!

Lesson of Distinguishing Goals and Means

Coordination in a community implies working to ensure it. Someone needs to do this work. We need to find and involve someone in this. How to look for them? In modern democracies, everything usually comes down to two mechanisms: an official is appointed by a higher authority, or they are elected by vote. Voting is just one of the possible meansof achieving a compromise solution in selecting candidates from a group, and it has a lot of drawbacks. There are many other means. The most unbiased means was originally considered lots. There are also exams and other types of competitions, there’s the purchase of positions, there are tenders, there is volunteering… Democracy doesn’t reduce to voting. The lesson is obvious here:

Don’t substitute goals with means. Don’t try to use a tool for everything, even if it’s very fashionable. Use what is simpler, more reliable, and that solves the specific task that has been set.

Lesson of Breaking Out of the Vicious Circle

Как ни распределяй власть, какие ни внедряй сдержки и противовесы, как ни связывай власть имущих законами, система со временем деградирует. Деградировав, она порождает новых тиранов, а потом по их головы приходят новые тираноборцы… Что может помешать соблазну сконцентрировать власть? Только одно: отсутствие того, что можно сконцентрировать.

Если координация происходит добровольно, в этом процессе нет места для того, кто принуждает. Чем больше места занимают добровольные отношения, тем меньше места занимают властные. Отсюда простой урок:

Если вам что-то нужно от других, спрашивайте, что хотят взамен. Не считайте, что вас должныдолжны

Подведём итог

С одной стороны, демократия – это способ не дать немногим всю полноту власти над большинством. С другой стороны, демократия это возможность для большинства получить общественные блага дешевле, чем они бы стоили на рынке. Это большой соблазн, но надо отдавать себе отчёт в том, что это тоже тирания, только тирания большинства. Переход к рынку вместо принуждения – это нравственный выбор людей, которые сознательно отказываются быть тиранами. Только этот путь ведёт к настоящей свободе.

Libertarian theory of war, section 3.2.3 completed.

Finished chapter 3.2, which describes waging war in the event that a group attacks. The most interesting scenario is analyzed — when a group attacks a state.

For the sake of brevity, I preferred to limit myself to considering the situation where you are in the attacking group, rather than when some outsiders are trying to destroy your beloved state. Perhaps I will still need to write this subsection later, but I will try to do without it.

Things are either feast or famine for me: new posts are coming out quite frequently in November, and poor Bitark doesn’t even have a chance to get a word in. Another article from the old archives is on the way, as well as one answer to a subscriber’s question.

Stephan Molynieux, The Practical Anarchy, translation of chapter 26 of 29

The final edited translation of another chapter from Stephan Molinari’s book Practical Anarchy has been posted—about how a stateless society solves the problem of issuing reliable money. The text was written shortly before the appearance of Bitcoin, and therefore it does not concern how a stateless society can ensure reliable money despite the will of governments, but merely how it all could work in the absence of state opposition.

Nevertheless, the text is by no means useless. In essence, it describes the prospects of what the tokenomics of Montelibero could turn into if it were to achieve significant scale. We already have a fairly developed system of private monetary obligations of varying liquidity, but overall our monetary market is still too small for there to be economic sense in the emergence of complex clearing systems. Our private money largely takes the form of obligations backed by goods and services offered by the issuer, and the issuance represents a form of obtaining a loan to launch or maintain the production of these very goods and services. Accordingly, the more widely a service is demanded, the more liquid the monetary obligations issued for it become.

Molinari will soon be finished, and it is not a given that I will take on new large projects for translation. Firstly, people do not read long texts very often. For example, during the entire time a volunteer-translated draft of the chapter on money was on my site, no one complained that a page of text was simply missing from the middle. Secondly, if a person needs to tackle a text in a foreign language, they search for a translation less and less often, and more and more often trust the on-the-fly translation tools built into the browser. Yes, neural networks produce a mediocre semi-finished product, but for simple texts this is enough, and in the case of complex ones, the reader usually has a good understanding of the subject and understands what the author wanted to say, even based on a poor translation of individual difficult parts.

Economics, Law, and Neuroslop

Because of my new job, I don’t have a lot of free time right now, but there is still a little left for entertainment. Since I’ve been asked to promote some of these activities, I think I’ll share my plans for the coming month.

On November 3rd, I’m setting aside time for Adam Smith Readings. Traditionally, on this day, instead of long-form posts, I will have many short notes throughout the presentations. I will definitely post them on Telegram; as for Huitter and Nostr, we’ll see depending on the circumstances. The organizers promise nine speakers. My favorites in terms of anticipation for exciting and non-trivial presentations are Kapelyushnikov and Vatoadmin; Morozov will probably trigger me, Bazhenov will likely put me to sleep, Ali’s presentation topic looks like a box-ticking exercise, Kynev’s topic looks like a story about some alternative universe, and I don’t know Salnikova and Troparevsky. They won’t bring in an English-speaking speaker, which is understandable—Mordor is for orcs. Overall, my expectations are quite high. I hope there are no internet outages on the Russian side.

November 7th is a memorable date for all extremists, so I’m dedicating it to an extremist event: the press conference of the Association of Arbitration Courts, where the courts belonging to the Association will, among other things, sign a memorandum on the framework of cooperation. I was invited there by the organizer of this whole movement, since the offer for my own court has been posted in the public domain for quite a while. I already have experience judging within the Association, so we will develop the cooperation.

Also, theoretically, the MTL-fest is supposed to take place in Podgorica on November 27th, but I have a very strange attitude toward it right now. The first one was in MTL-City, and its main goal was to brag about how ancaps know how to build roads. The second was in Bar, and its main goal was to bring in Pozharsky to speak, since Svetov was brought to the first fest. The third will be in Podgorica, in English, and its main goal will be to show that Montelibero is just another harmless NGO and shouldn’t be crushed by the state’s boot. It’s not very clear how much I need to be there, or how much they need me. But I’m keeping it in mind anyway.

And it’s not all just talk. Valera asked me to mention his media project RoninRoker, where he posts multi-genre songs on the theme of freedom. These are, of course, neural network creations, but they are certainly no more embarrassing than Bitarkh’s articles. Three versions are provided for each song: Russian, English, and Serbian. Valera also performs these live, which further blurs the line between human and machine creativity. In terms of mood, with the onset of the rainy season, “Neon Freedom” felt closest to me, so I’ll attach it here as an illustration.

Ancap-chan

I answer questions on ancap, libertarianism, economics, politics, ethics, law and occasionally on abstract topics.

Автор: Анкап-тян