You are passionately telling someone about your views, you see that the person is interested, but you realize that in five minutes they will forget half of the terms they heard, and when they try to Google them the next day, they will discover a lot of new things about vegetarianism and monarchy instead of libertarianism and panarchy… For this reason, it is always useful to carry a few simple business cards with you; that way, even after a very heavy drinking session, there is a chance that the conversation wasn’t in vain.
Bitarch and I have prepared a sample for you. Just print one page on heavy paper at any copy center; it will almost certainly come in handy. The business cards are made to be exactly the same size as a bank card, so you won’t have to guess where to keep them—after all, you keep your cards somewhere.
This book is a structured collection of the most significant articles from the LiveJournal blog of the well-known libertarian philosopher Oleg Tarakanov (“Laxy Catal”). The articles are presented in full and unaltered, without edits from the compiler.
In the opinion of the compiler, Tarakanov’s work examines the most realistic model of social organization in terms of current implementation possibilities. It is designed to solve the ever-multiplying problems of people in nearly all modern states based on territorial monopoly and the “tyranny of the majority.”
Oleg Tarakanov himself uses the term he coined, “insurance roofs,” instead of the word “panarchy,” but the compiler found it possible to use the more commonly accepted concept. Panarchy does not aim for the complete destruction of the state, but advocates for the abolition of its territorial monopoly and for voluntary participation in it. It is a system of extraterritorial contractual (and/or competing) jurisdictions (ECJs), in which different people can choose their own “virtual state” while residing in the same territory.
Such an approach ensures competition between jurisdictions, forcing them to spend budgets more efficiently and not infringe upon the personal and economic freedoms of citizens. But more importantly, people gain the opportunity to live by the rules that are closest to them personally, rather than those that were imposed by the will of the majority living in a particular territory. After all, in an ordinary territorial state, only a small portion are actually able to emigrate, while others are forced to endure anything, which is precisely what governments exploit, ignoring their interests.
I can assume that some convinced followers of Rothbard will not consider panarchy to be true libertarianism. Nevertheless, compared to unstable minarchism and difficult-to-implement anarcho-capitalism (ancap), panarchy is the most realistic and easily “sellable to people” option for moving away from the current sad state of affairs. In a mode of panarchy, diplomats already live according to international agreements, so we are talking merely about the large-scale implementation of a ready-made mechanism that has already proven itself.
If you did not like the potestatic (“force-based”) approach to bringing under jurisdiction and the enforcement of court decisions in Oleg Tarakanov’s model, do not turn away from the idea of panarchy entirely. Consider the Bitnation project, where all of this is carried out absolutely without any coercion based on a blockchain reputation system.
You can ask your question regarding panarchy and libertarianism on the Ancap-tyan website, in the VK public “Anti-state”, and on my page.
Three main types of system organization can be identified: centralized, decentralized, and distributed. This applies to all complex systems with multiple nodes, both technological and social. In a centralized system, there is a single point of control (a server) through which all interaction of regular nodes (clients) occurs, both with the server itself and with each other. In a decentralized system, there is no single server; instead, there is a certain number of super-nodes connected to other super-nodes as well as to clients (client-to-client interaction occurs with the participation of super-nodes). In a distributed system, the network is entirely peer-to-peer, and clients interact with each other directly, without any intermediary.
Let’s consider the history of the Internet. In its early days, if you wanted to distribute a file to other people, you had to upload it to your own server (Web, FTP), from where anyone interested could then download it. As the flow of visitors increased, your server might fail to handle the load, or the bandwidth of the communication channel could be exhausted, which ultimately made downloading the file impossible. I don’t think it’s necessary to mention the extreme vulnerability of such a system to a “forceful” server shutdown—that should be obvious.
Later, decentralized file-sharing systems appeared, such as Kazaa, eDonkey, and BitTorrent. These no longer had a central server that could easily fail. User interaction occurred through many independent super-nodes (for example, torrent trackers), which provided file search and coordination of data regarding the availability of files on regular users’ computers. For greater resilience and improved quality of service, fully peer-to-peer (distributed) networks later emerged, such as BitTorrent with DHT, which can operate without a torrent tracker at all, or the InterPlanetary File System (IPFS) on the blockchain, which is fully resistant to censorship and individual node failure.
Decided to create your own internet resource? You’re in luck! Today there is a sea of options for hosting it. A quarter of a century ago, it would have been significantly more difficult. Back then, you needed to possess a huge sum of money to buy a physical server, place it in a room with a high-speed Internet connection, powerful power supply, cooling, etc. It is not surprising that there were practically no individual online projects at that time.
The boom of the Internet coincided with the appearance of virtualization technology, which allowed several virtual machines (VMs) to run on one physical server simultaneously. For example, there are the well-known VirtualBox and VMware. Each virtual machine allowed it to be treated as a physical server, solving the problem of running several applications simultaneously (each may require its own versions of system libraries and OS settings, so running them simultaneously under one OS could create a conflict).
The number of applications grew, but the ability of a physical server to run VMs is limited by memory and disk space. A solution emerged—containerization—virtualization at the operating system level (e.g., Docker). It uses the shared kernel of the physical server’s operating system, and each container encapsulates only the application itself, the required versions of libraries, and specific OS settings (rather than a full OS, as in a VM). This allows for a significant reduction in the size of the container image compared to a VM (which makes it easier to move from server to server), and also reduces the load on the physical server (meaning more applications can be run on it, lowering the price for end users).
How does all of this relate to social organization? Currently, we live in a fully centralized state with a territorial monopoly (the so-called Westphalian state) and constantly encounter it. As in the previous example with different versions of system libraries for different applications, different people have different values, religions, and ideas about life. It is complete absurdity to believe that, for example, Turks and Kurds can live by the same laws! And, as we see, any attempts by the Turkish authorities to impose uniform rules are met with resistance, up to armed struggle.
The simplest solution in this situation seems to be a transition to a decentralized system in the form of panarchy (a system of contractual jurisdictions – CJ), where each group with shared views has its own government, not tied to a territory. Some libertarians may not like this option, as they want to choose “components” on the market entirely according to their own tastes and not depend on a CJ. This results in a fully distributed model, which we call anarcho-capitalism (ancap).
History has many examples of transitioning from a centralized system to a decentralized one, and then to a distributed one. Here is another example—electronic media. First, there was fully centralized radio and television, then came the decentralized Internet with websites, and only now are the sprouts of fully distributed applications appearing (such as Bitcoin, or Ethereum with smart contracts). I cannot even provide examples of a transition from a centralized system directly to a distributed one (bypassing the decentralized), so I consider such a thing extremely unlikely. This also applies to social organization, and it is naive to believe that we can move directly from a centralized state (even a minarchist one) to ancap. I provided practical arguments in my article “Realistic Libertarianism”.
When reading people’s opinions on the ideas of anarcho-capitalism (ancap), one can often hear that it is a “utopia,” “escapism,” a “fantasy world,” a “fandom,” and that libertarianism itself is a “sect,” a “cult,” or an “ideology for rich hipsters.” It is obvious that while the ideology of ancap is consistent and theoretically feasible, convincing the vast majority of people of this is quite difficult, if possible at all. Attempting to transition to ancap via minarchism, as proposed by one of the leaders of the LPR, Mikhail Svetov, is also a dead end—the instability of minarchism has been proven both theoretically and empirically through numerous historical examples.
Besides the well-known division of libertarianism into ancap and minarchism, there is another ideology that could also be called quasi-libertarian: panarchy. It appeared more than a century before Rothbard’s ideas, when in 1860, the Belgian scholar Paul Émile de Puydt wrote a pamphlet titled “Panarchy” (“pan” and “archy” meaning “power of all,” “omnipotence”) [1]. During his lifetime, he did not attempt to promote this idea, and it was only remembered in the 21st century with the growing popularity of libertarianism and blockchain technologies.
Panarchy does not aim for the complete destruction of the state, but advocates for the abolition of its territorial monopoly and for voluntary participation in it. In short—laws should apply to people, not to territory. If you dislike something, you can choose another ETC without leaving the country. You can also find like-minded people and create your own ETC with your desired laws.
Other names for this ideology are extraterritorial contractual jurisdictions (ETC, sometimes just CJ), extraterritorial state, insurance state, umbrella states, poly-state, multi-government, FOCJ, cellular statehood, virtual cantons, modular state.
Cellular Statehood
In this article, I will attempt to provide arguments in favor of panarchy over ancap and minarchism, based on the criterion of the realism of implementing the theory in the real world. Pure Rothbardian ancap with the absolute non-aggression principle, of course, seems more attractive to libertarians, but it must be understood that its realization could take a long time and exceed the planning horizon of each of us.
Panarchy solves most of the problems inherent in ancap and minarchism, which are often used as criticisms against libertarians and complicate the promotion of libertarianism to the masses.
1. Social Protection
Although libertarians propose private insurance and charity as solutions, statists put forward a quite strong counter-argument, upon hearing which many people turn away from libertarian ideas: “What if a person is poor, cannot buy insurance, has no friends, and no one wants to help them? Are they left only to starve to death?”. In my observation, this is the most common objection to libertarianism, applying to both ancap and minarchism.
In panarchy, such people can choose a socialist ETC and receive social protection exactly as they do now from the state, paying voluntary contributions (“taxes”) to their ETC. This applies to all services of modern states—education, healthcare, the pension system, social insurance, security, and fire protection.
2. Public Spaces
We are used to leaving our apartments into a “public space” that belongs to no one and therefore cannot be “locked” for us. Ancaps, however, say that everything should be private, meaning that from your own territory you would step onto someone else’s. And the owner is essentially omnipotent, meaning they could simply forbid you from entering their property, effectively locking you in your own. This is a slightly contrived example, but somewhat frightening: private roads, forests, fields, seas—and the owner is an absolute ruler. It scares me. Furthermore, it is unclear how to privatize what is currently common; it is too conflict-prone a process. How do you privatize a street in Moscow to account for all interests and offend no one, without infringing on anyone’s “common rights”? I believe privatization is impossible due to the conflict-prone nature of the process and the fears associated with it. I am more inclined toward flexible forms where there is room for easements and common law, where not everything becomes private, remaining common/no-man’s-land. [2]
3. Defense
An argument often raised against ancap is that a stateless territory would quickly be seized by highly organized states with powerful military-industrial complexes. In reality, this is not the case, and a well-organized decentralized defense is capable of resisting even a strong opponent [3], making the residents of that territory an “unprofitable victim” for the aggressor.
Panarchy combines both the advantages of decentralized defense found in ancap and the resource-technological capabilities of a state [4], including for the creation of weapons that maintain peace through a deterrence doctrine (for example, ballistic missiles and stealth kamikaze drones, ensuring a high probability of destroying the enemy’s decision-makers who initiate aggression).
4. Popularity of the Idea of Freedom
If you ask a group of ordinary people “Which values are most important to you?”, the ideals of freedom will be far from the first place. Classical-liberal (minarchist) parties have existed in Europe for a long time, yet they have never achieved great success in elections. Even the most powerful class-lib party in Europe—the Swiss FDP.Die Liberalen—has garnered only 15-20% of the vote for many decades. [5]
Panarchy, instead of abstract ideas of freedom that are poorly understood by the majority, promotes the possibility of living by rules and cooperating with people you have chosen yourself without coercion (unlike modern states, where you are obliged to obey the will of the majority, even if you disagree with it). Another argument is the increase in the efficiency of state services through competition (in modern monopoly states, people clearly see how their taxes are wasted).
5. Default Choice
States usually provide standardization of product quality, testing of drug efficacy, some kind of standard for universal school education, basic emergency medical care and fire protection (available to all, regardless of purchasing insurance), protection of labor rights, and various “one-stop-shop” services. Many people do not want (or do not have the possibility for objective reasons) to spend their time studying millions of different offers on the market and prefer to receive some sort of default option.
6. Unified Understanding of NAP
Among libertarians, there are constant disputes about the permissibility of abortions, the age of sexual consent, the sale of drugs, contractual slavery, and some other issues arising from different understandings of the Non-Aggression Principle (NAP) among different people. Attempting to impose a single standard for everyone only leads to the rejection of libertarian ideas. In panarchy, each ETC can have its own understanding of acceptable norms. People and businesses may choose not to cooperate with citizens of other ETCs in certain areas of life if they diverge strongly from the norms of their own ETC. Also, if a person strongly diverges from the values of their ETC, they can seek protection from another ETC and transition to it, if they are accepted (analogous to refugee status in a modern state, which is unclear how it would operate under ancap).
7. Painless Relinquishing of Power for Government Members
The transition to panarchy can happen completely painlessly for the current authorities—a “fork” (parallel government) is created, and economic entities (schools, hospitals, state enterprises, road services, universities, etc.) will be able to choose which one to join (they can switch to another ETC at any moment if they wish) [6]. In this case, the members of the government currently in power in a centralized state will remain in power in the first formed ETC and need not fear for their personal safety. Otherwise, the lack of guarantees of inviolability greatly complicates the change of power, as the current authorities will fight to the end, knowing the fate that awaits them in the event of a violent overthrow.
8. A Clear Transition Scenario
In many countries, there is currently a strong polarization of society, as in the USA, where the division in values between supporters of Democrats and Republicans has reached a historical maximum [7]. This has a strong destabilizing effect on the government (its members are constantly unable to agree on most issues among themselves) and creates fertile ground for the formation of ETCs “from below.” For the “top-down” authority, this is also beneficial, as it minimizes the probability of a bloody revolution and reprisals against its members, as described in the previous point. Other scenarios are considered in the blog of the well-known “evangelist” of the idea of panarchy, Oleg “Laxy Catal” Tarakanov [8].
9. Presence of Many Examples of Panarchy
Ancaps are often asked: name countries where anarcho-capitalism was or is? Aside from the well-known examples of medieval Iceland and Ireland, there is usually nothing to say. Extraterritorial jurisdictions, however, have existed for almost all of known history—these are the early (before the reforms of Cleisthenes in Attica) Greek poleis, medieval universities, religious orders, guilds and craft associations, millets in the Ottoman Empire, and partly pillarization in Holland until the mid-20th century. The modern Order of Malta, having no territory of its own, is essentially an extraterritorial state [9]. What’s more, even now diplomats of all countries in the world, according to international agreements, live under conditions of panarchy! [10]. And since the model is already well-tested, nothing prevents its large-scale implementation. The principle “all are equal before the law” could actually start working, whereas now it remains only in official declarations.
10. Compatibility with Ancap
Although panarchy looks like a retreat from ancap principles, it may nevertheless turn out to be a quite realistic precursor to it. Participation in an ETC is voluntary; accordingly, the evolutionary process will gradually weed out those that are inconvenient for clients and leave those that best satisfy the ideals of freedom.
Sources
Paul Émile de Puydt “Panarchy“, trans. Egor Liskin
Adeptes of minarchism often cite Switzerland as an example of a successfully functioning minimal state that we should all strive for. They consider the confederal structure to be a guarantee against the expansion of government powers. In reality, however, there is a creeping growth of the state with signs of acceleration in recent decades. For example, a law prohibiting the criticism of homosexuality was recently passed, de facto destroying freedom of speech—the foundation of a free society. This puts a final end to the belief in the possibility of the sustainable existence of a minimal state.
A territorial monopoly will always strive for growth, and no measures are capable of restraining it. Only competition for people can reverse this trend. Even if you consider anarcho-capitalism a utopia at the moment, proposing minarchism as a transitional model is even more utopian! Do not waste your time; instead, pay attention to the model of extra-territorial contractual jurisdictions (ETC, panarchy).
In Western Europe, especially in German-speaking countries, minarchist (classical-liberal) parties have existed for many years. The ideology of the LPR and, in particular, Mikhail Svetov, is very similar to the ideas of the Swiss FDP.Die Liberalen, which is not surprising, as he praises Switzerland in almost every lecture as the country closest to libertarianism.
In reality, he only provides facts taken out of context, omitting the prevalence of ever-increasing regulation and taxes that are not symbolic at all. This is not surprising—the influence of FDP.Die Liberalen on Swiss politics is not that great, and in recent years it has garnered only slightly more than 15% of the votes in parliament. Compared to other countries, in many of which minarchist parties are not represented in parliament at all, this is a decent result. But to build a libertarian society through election victories, this is completely insufficient. A similar picture exists in Germany—the results of the local FDP are even slightly more modest than the Swiss ones, remaining at around 10% for many decades.
Evaluating the prospects of the LPR in Russia, it is worth noting that in our society, the ideas of minarchism are even more marginal than in Europe. This party is unlikely to even enter the State Duma, let alone have any significant influence on state policy. Minarchists in Europe failed to achieve this over decades of active political struggle, and it is completely foolish to hope that it will be different in the RF.
To promote libertarianism, the path of party struggle clearly cannot be the only one. Hoping for a gradual transition to a free society through minarchism is also meaningless. In my opinion, a more realistic approach is to educate people with the ideas of a free society and the model of extraterritorial contractual jurisdictions (ECJ) as a transitional model to a free society with a full NAP.
Among many oppositionists, there is an opinion that it is enough to do in Russia “as in Europe” and we will live almost in paradise. They usually praise Western countries for the separation of powers, honest courts, a transparent budget, smart regulation, fair taxes, freedom of speech, and many other things missing in the RF. But some of these people then begin to notice that all those achievements, for which they were ready to leave their homes, are slowly but surely fading even in their beloved West, let alone being transferred to Russia.
Why does this happen, and why is it pointless to wait for the state to improve, just as it is pointless to emigrate? I am ready to propose a hypothesis based on thoughts from the lectures of the famous sociologist Ella Paneyakh (they are on YouTube). I cannot guarantee the absolute accuracy of this hypothesis, but I believe the probability of it being true is over 99%.
In her lectures, Ella explains the theory of the stationary bandit, explaining the positive (creative, progressive) vector along which the state guided society as a necessity for military superiority over other stationary bandits. If one of them preferred traditional values and obscurantism, while another preferred progress and human rights, the latter would sooner or later achieve technological superiority over the former. Ultimately, traditionalists and supporters of a “brutal” violent hierarchy were simply conquered by more progressive states. Since the development of technology is impossible without respect for the individual and human rights, states were forced to adopt the best practices for ensuring personal freedoms from one another, increasing trust in the tax system through a transparent budget, creating social elevators for youth, fighting corruption, and offering asylum to defectors.
After World War II, as a result of the emergence of the doctrine of deterrence through the threat of mutually assured destruction, wars between more or less developed countries ceased completely. After all, no politician will dare to start a war if they know they themselves can be destroyed. As a result, the incentive to develop and create better conditions for their own citizens disappeared. After all, no one is threatening you, and your own population can be suppressed even with ordinary batons and tear gas.
The lack of an incentive to develop does not mean a stop in the competition of state practices; it is just that now states adopt methods of oppressing their own citizens from one another — hidden taxes, internet censorship, fighting protests and rallies, social ratings, surveillance, etc. You have probably noticed that some of these appeared first here and then in the West, others vice versa. But in general, both here and in the West, the volume of rights and freedoms is gradually, and at an increasingly rapid pace, decreasing. Emigration becomes pointless, because after a certain amount of time, all those shortcomings for which you left will also appear in your new location.
How can we bring back the competition of positive practices? By getting rid of the territorial monopoly of the state and moving to a system of extra-territorial contractual jurisdictions (ETCJs), we will create an incentive for individual ETCJs to compete for citizens. After all, switching to another ETCJ would be as simple as changing a mobile operator. Consequently, the managements of these companies will be interested in offering the best conditions for citizens.
Suppose someone you know or a business partner has taken offense at something and has begun to threaten you with the leviathan. Let’s say the laws are also on their side, and they are demanding money or something else from you. You disagree with these demands and believe you are in the right, and you would prefer to ignore state laws, but it is profitable for your counterparty to use them against you. What should you do?
If your kind word does not have enough persuasive power to resolve the conflict privately, there is nothing terrible about threatening to also turn to the state on your part. Its laws are written such that everyone is guilty before it, so your threat is something like resorting to the doctrine of mutual nuclear deterrence.
Describe to them in vivid detail all the problems that you both will face if you start official disputes; tell them that you are ready to go to the end, but would gladly avoid all this mutual disgrace if they, following your lead, show consciousness and refuse to use the state against people.
It doesn’t matter at all what you threaten with. The state will roast one person for unauthorized apartment redevelopment, another for paying staff under the table, and a third for swearing in a public place. Something will definitely be found.
Isn’t it wonderful when even your own minor disagreements can be turned into an act of defiance against the regime!
People often ask how a libertarian society can be built by coming to power through elections. I will not dwell in detail on whether a libertarian party can come to power through elections at all, because this is the weakest point of the entire idea.
What options for building a libertarian society can the LPR choose? Mikhail Svetov often mentions them in his lectures, so I will try to explain them in plain language and provide my own comments.
1) Federalization. Mikhail constantly praises the USA and Switzerland for their model of national organization, reminding us that the RF is also de jure a federation (but not de facto—due to the violation of the constitution by the state’s first person). In this case, it will be possible to test various models of libertarianism in different regions and transfer best practices from one to another. The advantage of this approach is that in the event of an error, the consequences will be limited to one region rather than spreading across the entire country.
2) Homesteads. The idea is borrowed from the history of the settlement of the USA, when settlers from Europe occupied vacant lands, and later the government recognized their property rights to these plots. Svetov proposes to distribute the uninhabited territories of Siberia and the Far East in this way, granting settlers the right to autonomy, as if they were colonizing Mars (and accordingly, the opportunity to experiment with various libertarian models). Successful practices from these regions could then be gradually transferred to the main part of the country. Although, judging by the comments on this idea, people are not very eager to move to regions with such a harsh climate and a total lack of infrastructure.
3) Minarchism. A gradual transition to ancap is carried out through the gradual reduction of state functions across the entire country at once (as if the RF were a unitary state, which it is de facto now). Svetov means exactly this path when he calls himself a “forced minarchist.” This immediately raises the question of the stability of minarchism as such, which is further amplified by the centralization of power. A single unsuccessful reform could easily incite the people’s rage and end the LPR’s time in power, which would then create a negative image for the entire libertarian idea in the eyes of the general public for a long time.
Personally, I would propose another option—federalization of the country (simply follow the current constitution of the RF, it’s already in there) and the creation of competing extraterritorial contractual jurisdictions within regions that have approved the experiment by referendum. As the model is refined and “pitfalls” are eliminated, the geography can be expanded, gradually making all of Russia libertarian.
To the last paragraph, I would like to add that an extraterritorial jurisdiction is extraterritorial precisely so as not to be limited by some narrow list of regions. Today, there is one extraterritorial jurisdiction in the world—the jurisdiction of the United States of America. This state does not care whose territory its citizen is on; they continue to exercise their jurisdiction over them. But it is, of course, not contractual.
