Robert Nozick is one of the most influential right-libertarian philosphers. In his book "Anarchy, State, and Utopia", he defends the idea of a minimal state, arguing that a larger state violates individuals' rights. He believes that the only legitimate functions of a state are to protect individuals from force, theft, and fraud, and to enforce contracts. This representation of a minimal state is called a Night-Watchman state - a state where the government is only concerned with the provision of military defense, police, and courts. Nozick's ideas are influential and well-regarded, if not always agreed with. This post explores some of them.

To analyze whether the existence of a state is beneficial compared to anarchy, Nozick sets off to show how an anarchic society can gradually tranasform into a state. As a reasonable starting point, we can consider a world of scarce goods, where people live together in groups, and thus interpersonal conflicts are inevitable. And since dealing with these conflicts in a violent manner is costly, rational people need to come up with a peaceful resolution to such conflicts. Nozick also takes natural rights as given and builds on top of the Lockean state of nature - a moral condition that supposedly existed before the creation of political societies and governments. It can be characterized as follows:

  1. Equality and Freedom: all people are free and equal. There is no government or political authority. Each person is independent and has the freedom to do as they please, as long as they do not harm others in their "life, health, liberty, or possessions."
  2. Natural Law: Despite the absence of political authority, the state of nature is not a state of chaos. It is governed by natural law, which everyone is obliged to follow.
  3. Right to Punish and Retribution: In the state of nature, individuals have the right to enforce natural law and punish those who violate it. This right can often lead to a "state of war" in which people seek retribution for wrongs done to them.

In such a state of nature, individuals, recognizing the potential for conflict and harm, would voluntarily form protective associations for mutual defense. These are essentially groups of individuals who agree to act together to protect each other's rights and enforce justice. These associations may also come out of entrepreneurs going into the business of selling protective services. In the case of conflict between the clients of two protective agencies, they would attempt to solve the conflict in a reasonable way that favours their clients, and if that is impossible, they may contact a judge to arbitrate the dispute.

Over time, some protective associations become more effective and efficient than others, attracting more members and becoming dominant in a given territorial region. This is not a matter of coercion, but a voluntary choice by individuals who perceive the dominant association as providing the best security. At this point, the dominant association would effectively resemble a minimal state. However, it is not. A state is a human community which claims the monopoly of the legitimate use of physical force within a given territory. In the context of the protective agencies, a necessary condition for the existence of a state is that the organization should announce that to the best of its ability, it will punish everyone whom it discovers to have used force without its express permission.

The dominant protective agency is not a state because it does not take action against people who are not clients of any protective association, who have taken into their own hands the matter of enforcing their rights and exacting compensation from those who infringed them. Moreover, the dominant association protects only paying clients (assuming there are no spill-over effects). It does not extend its services to everyone. Therefore, the dominant protective agency differs from a state in that it lacks a monopoly on the use of force and fails to protect all people inside its territory. At least so it seems.

Now, inbetween the dominant protection agency and the minimal state lies another entity, which we can call the ultraminimal state. This entity has two characteristics. First, it avoids any form of redistribution. This means that individuals aren't required to pay for the protection of others. Second, it carries the singular authority to enforce force, positioning itself as the sole arbiter of justice and law enforcement within its jurisdiction. What would it take to permit the actions of such a ultraminimal state? What are the moral characteristics of such an entity? There are two approaches:

  1. Utilitarianism advocates for the greatest good for the greatest number. The actions of the ultraminimal state, under this perspective, would be morally permissible if they serve to minimize the total violation of rights, even if this involves infringing upon the rights of a minority. In essence, the cumulative welfare of the population forms the basis of moral actions.
  2. Kantianism, on the other hand, holds a different view. It posits that an ultraminimal state is morally permissible only when its actions respect the rights of each individual. Kantianism views individuals as ends in themselves, rather than merely means to an end. Under this ethical framework, the state's actions are justified not by their outcomes, but by their alignment with moral duties and respect for individual rights.

With utilitarianism killing an innocent person in order to calm down a mob that would otherwise violate even more rights is acceptable. With Kantianism it is not. To be morally permissible, the ultraminimal state cannot violate the rights of one individual, even if doing so would lead to a greater good for the majority. Therefore, the ultraminimal state, in its operations and enforcement of force, must always act in a way that respects and upholds the inherent rights of all individuals within its purview.

And here is the immediate next question: what happens to non-members of the protection agency (typically called independents) who are not allowed to enforce their rights through private means? This will steer the discussion into ambiguous topics like prohibition, compensation and risk. In general, individual B can do anything to individual A, as long as he has A's consent. But when A does not give his consent, and thus his rights are violated, what can be done? One almost universal approach would be to force the felon B to pay compensation to A. The compensation should be that amount of money or goods, which would make A indifferent between having his rights violated but receiving compensation, and not having his rights violated in the first place.

But if the offender is forced to pay just the compensation, this may not really reduce the number of infractions of one's rights - perhaps because the probability of getting caught is too low, or the personal gain from the felony is too high. In those cases an additional punishment in the form of extended costs payable to A might suffice to create the desired effect. There are two choices here:

  1. In a retributive justice framework this additional monetary punishment is proportional to the harm done to the victim. Clearly, for harmless crimes it may still be the case that a potential infractor finds it desirable to commit a crime, even considering the compensation, the probability of getting caught, and the additional punishment. Hence, retributive punishments will not deter all people from committing crimes.
  2. In a deterrence framework the punishment cost is typically set to be extraordinarily high, so as to make it expensive for anyone to commit a crime. This approach, then, manages to reduce the violation of rights considerably, but is unjust in that the punishment is unproportional to the harm done. It is also harder to implement this approach as it's more difficult to calculate the minimam punishment that would deter all potential criminals.

Compensation is also not itelf unproblematic. For example, should all actions be allowed as long as compensation is paid in the case of violation of rights? Probably not, because even allowing some actions can cause general fear which cannot be attributed to any one potential infractor. Hence, what Nozick claims is that all actions which are believed to cause mass fear can be prohibited. Similarly, one can ask whether all boundary crossings (people crossing a boundary, e.g. physical harm) that were not consented in advance should be prohibited. This would certainly reduce the number of infractions, but it would be too restrictive. The suggested solution is that any unfeared action can be performaed without prior agreement, if the transaction costs of reaching a prior agreement are greater, even by a bit, than the costs of the posterior compensation process that would settle the conflict after it has occurred.

Coming back to the state of nature, one can realize that the dominant protection agency is a de facto monopoly due to its competitive advantages. It already is the ultraminimal state described earlier. It does not have any special rights to be a monopoly, it just is. In particular, any conflict between clients of the protection agency will be handled internally based on various morally-compliant rules and guidelines which are approved of by the clients. It is more interesting the way conflicts between clients and non-clients, or independents, are handled. The dominant agency believes that the way it solves boundary crossings is just and optimal - as evidenced by the majority of people being its clients. However, the methods for rights enforcement applied by the independents are more uncertain.

Consider what happens when an independent decides to enforce his own rights against a client of the dominant agency. It may very well be that the procedure employed by the independent is risky or unreliable and has a non-negligent probability of harming the dominant agency's client or even some third unrelated client. In any case, such a procedure will be deemed unreliable, risky, or unfair based on the standard of rights enforcement held by the dominant protective agency. Hence, the agency has an incentive to prohibit those procedures deemed risky or unreliable and an incentive to punish those independents which employ such procedures.

With the reasonable assumption of existing procedural rights - that everyone may defend himself against unknown or unreliable procedures and may punish those attempting to use such procedures against them - the dominant agency recognizes that everyone has these rights and enforces them in conflicts with defective procedures against its clients. It believes that its own procedures are reliable and fair. By virtue of its power, it has the position to prohibit anyone to defend against the application of its own procedures. It will act freely on its own understanding of the situation whereas no one else will be allowed to do so with impunity.

Thus, the dominant protective agency claims the right to punish anyone who is using actually defective procedures on its clients. And while it acts against these defective procedures, others may see it as acting against what it thinks are defective procedures. This assymetry is what allows us to call the dominant protective agency a de facto monopoly, from which it results that an ultraminimal state has been developed.

The dominant agency does not interfere in conflicts between independents - there anything goes. However, by prohibiting independents from defending themselves in conflicts concerning the agency's clients, it severely disadvantages them in their daily lives. At this point, the moral (although not obligatory) thing to do would be to compensate them, as discussed above. In general, Nozick favours the principle of compensation - the idea that some specially dangerous actions which are generally done can be prohibited as long as you compensate the specially disadvantaged individual from the prohibition. Consider the following two cases:

  • Epileptics are more prone to cause accidents when driving cars. Can we prohibit them from driving? Yes, we can, as long as we compensate them. The compensation amount should be the difference between their costs after the prohibition (to use taxis, chauffeurs, etc) and their costs before the prohibition (fuel, toll taxes, car maintenance, etc).
  • A person is playing Russian roulette with the heads of other people without their consent. Can we prohibit this activity? Yes, without paying compensation, because playing Russian roulette may not be considered something "generally done".

Since the dominant agency prohibits independents from using their methods in conflicts with the agency's clients, the independents are compensated by being offered money or protection services at a discount under the agency itself. This does not create a free rider effect, because while clients have the incentive to stop paying and instead be compensated, the compensation itself becomes quite limited as it's only valid in conflicts with paying clients. If anything, the incentives are that one should become a paying client.

This showcases how a dominant protection agency first becomes an ultraminimal state, and then can become a minimal state, with a territorial monopoly on the use of force and universal protection. Both steps happen in a morally permissible manner. Granted, there are some difference with how Max Weber defines a state. Nozick's state is not the "sole authorizer of violence", as independents may conduct violence between each other, but it is the "sole effective judge over the permissibility of violence".

I'll leave the other topics in the book for a future post. This includes the important question of why any state larger than the minimal one is not morally justified. Let's finally explore some of the major criticisms. According to Murray Rothbard:

  • No existing state has actually developed in the way described - as a morally permissive transformation guided by the invisible hand of the market. Instead the transition from anarchy to state-ness is rather discrete and abrupt. This "origin as conquest" view can be found also in the works of sociologist Franz Oppenheimer.
  • The implementation of the compensation principle is impossible due to utility values being subjective. This opens up a huge number of practical issues.
  • There exist no procedural rights - they require positive action from other people and in general they are not rights that can be deduced from basic self-ownership.

Clearly, the state formation process is a contentious one. All in all, I think "Anarchy, State, and Utopia" presents a solid thesis based on distinctive ideas which should be carefully analyzed and understood also in the context of other schools of thought.