17 Dec 2013

More on Drug Cartels and Private Law

Drug War, Economics, Gene Callahan, private law, Rothbard, Shameless Self-Promotion 57 Comments

I realized from the reaction of some people here that I did not assure readers I had fully understood Gene Callahan’s point, when he claimed that drug cartels today offer a real-world glimpse into what Rothbardian defense agencies would look like. So I wrote a follow-up post to be sure I acknowledged Gene’s exact point, and contrasted it with my own:

Thus, to reiterate, Callahan looks at, say, Colombian or Mexican drug cartels, and he sees: These are people who are operating outside of State interference and control. This is what the world would look like if we followed Rothbard’s advice and pulled back the State from every sector, not just the production and distribution of cocaine.

But hold on a second. There’s another effect too, when the government decides to make cocaine (say) illegal: It is now greatly magnifying the role of the State in this sector. In particular, there is an enormous “gang”–the biggest in society–of men with guns (and tanks, bombers, and missiles if push comes to shove) who will throw businesspeople in a cage, or possibly even execute them, for engaging in what otherwise would have been peaceful commerce. This aspect of drug prohibition obviously represents a move away from Rothbardian anarcho-capitalism.

I end with this observation, which is absolutely devastating to the Callahanian position for anyone who has the moral courage to truly ponder it:

So, if Callahan is right, then we should see pot dealers acting as violently as cocaine dealers. But if I’m right, we should see much less violence when it comes to the distribution of marijuana, compared to cocaine. And although I couldn’t find hard numbers to back it up, I think casual observation says that pot dealers are clearly less violent, as a general rule.

57 Responses to “More on Drug Cartels and Private Law”

  1. Ken B says:

    Are you arguing that if murder were decriminalized we would have less violent murderers?

    I think we have seen numerous industries where the profit margins were very high. Texas instruments made a killing from the first calculators. I do not recall the calculator industry being like Chicago in the 1920s, so the argument about marginal costs really cannot be quite adequate. It may contribute, and it probably does, but it’s not the whole answer. Had HP set squads of thugs to kill Texas instruments executives TI could have appealed to the law. This seems like a significant factor.

    If the question you are addressing is, is Gene’s argument dispositive, then the answer is clearly no it is not. But I think the extent of your argument, by suggesting other possible or even likely causal factors that may contribute the observed effect, is addressed to whether the argument is dispositive rather than does it have evidentiary value. You have noted two contributing factors to the observed phenomena and made a false dichotomy between them.

    • Bob Murphy says:

      Ken B. wrote:

      Are you arguing that if murder were decriminalized we would have less violent murderers?

      No, I’m arguing that if it were legal for private companies to maintain armed protection services to enforce private judicial rulings, then there wouldn’t be as many murders. You’re seeing a bunch of killings and conclude, “Not strong enough State involvement,” and I’m saying, “Too much State preventing the mechanisms by which the market would normally deal with this problem.”

      Had HP set squads of thugs to kill Texas instruments executives TI could have appealed to the law. This seems like a significant factor.

      Ken, as I said in my post: It is against the law to kill a drug dealer. If it’s a significant factor in HP then it is also for the Medellin cartel, vis-a-vis Gene’s original argument.

      Now it’s true (as I also pointed out), there is a sense in which drug dealers can kill with more impunity vis-a-vis the State than HP executives could. But it’s not because “drugs are illegal so there’s no property rights,” but rather, “Drug dealers already have to develop a huge network of systematic bribery, and thus they are less likely to be prosecuted by corrupt State officials than the relatively naive HP executives.”

      • Ken B says:

        As for the HP thing, no. dealers in the cocaine trade face very stiff sentences. Thus they will be more than a little reluctant to involve the law. Thus realistically for them there is no recourse to law. TI executives or low-level pot dealers, very different. After all, we both agree that people respond to incentives.

        So you haven’t addressed my main point which is that you are making a false dichotomy. Cannot both effects contribute to the observed behavior?

        Gene driving home after having a beer hits some ice and spins out. Can we say for certain that the beer didn’t ontribute because the ice is an obvious factor?

        • Bala says:

          Thus realistically for them there is no recourse to law.

          Correction.

          Thus realistically for them there is no recourse to The Law.

          Right there, Bob’s point about what the outcome would be if it were legal for private companies to maintain armed protection services to enforce private judicial rulings becomes very relevant.

          • Ken B says:

            Bob was making a factual assertion about the state of the world as it is. I pointed out the problem with that factual assertion. You are changing the topic. That constitutes a failure to rebut.

            • Bala says:

              I am not changing the topic. I am pointing out that you are pointing to the wrong thing. Bob’s point is about the presence of one big monopolist deciding and enforcing The law as against many competing agencies providing protection. You have therefore failed to comprehend the statement Bob is making about the state of the real world.

              • Ken B says:

                No Bala. That’s Bob’s overall argument, and Gene’s is the opposite, but it’s not what we were disputing. An argument is a connected series of statements intended to establish proposition, we were discussing one of those particular statements. Bob made the claim that cocaine dealers have essentially the same week course the law in cases of murder as to TI executives. I refuted that.

              • Major_Freedom says:

                “I refuted that.”

                Where?

              • Harold says:

                “An argument is a connected series of statements intended to establish proposition”
                No it isn’t!

        • Major_Freedom says:

          “Thus they will be more than a little reluctant to involve the law.”

          You’re missing the point. The point Bob is making is that because the state makes it ILLEGAL for private protection agencies to arise with enforcement powers, those involved in the cocaine industry have to either settle their own disputes in a context of no market for protection, or go to the state.

          You are incorrectly assuming that the violent activity that arises WITHIN the cocaine industry itself, is how a free market in protection would operate across the board. In actuality, free market protection need not be offered by the cocaine traffickers themselves. It is because private protection is made illegal that the activity of cocaine traffickers is made in an environment of not only little to no state resolutions (because they prefer not to involve the state), but zero competition from providers of security (since the state makes them illegal).

          It would be like you having 10 teenage children in your household, and you make any dispute resolutions from parties OUTSIDE the home “illegal” (for example you would make it illegal for your neighbors to offer their protection services to your children at the request of any of the children), and, to top it all off, none of your children don’t go to you for dispute resolutions because you’ll chain them to the radiator if you found out they were smoking dope.

          After some time passes, you learn that some of the children have been engaging in perpetual violence against the other children. Shooting, beatings, and fisticuffs. They asked your neighbor for help, but you made that illegal.

          Then, after years of abuse taking place among your children, you conclude “You see? This is why I have to be the monopoly of enforcement in this household. None of you seem to be able to keep the peace with each other. Obviously I shall take this experience as a microcosm of what invariably happens in a world without a monopoly on protection.”

          • Major_Freedom says:

            Forgot to mention:

            “It would be like you having 10 teenage children in your household, and you make any dispute resolutions from parties OUTSIDE the home and INSIDE the home among the children “illegal””

            • Major_Freedom says:

              And:

              “They asked your neighbor for help, but you made that illegal. One of the children asked another to help defend them against the aggressing child, but you made that illegal as well.”

      • Anonymous says:

        No, I’m arguing that if it were legal for private companies to maintain armed protection services to enforce private judicial rulings, then there wouldn’t be as many murders.

        SMH.

        • Bob Murphy says:

          SMH.

          I stand corrected.

          • Samson Corwell says:

            “Private judicial rulings” would be tantamount to hit contracts. No accountability, no rule of law, and no public records. In fact, I’m willing to bet that most such “private judicial rulings” would be contract crimes.

            Let’s review the Sixth Amendment to the United States Constitution:

            In all criminal prosecutions, the accused shall enjoy the right to a speedy and public trial, by an impartial jury of the State and district wherein the crime shall have been committed, which district shall have been previously ascertained by law, and to be informed of the nature and cause of the accusation; to be confronted with the witnesses against him; to have compulsory process for obtaining witnesses in his favor, and to have the Assistance of Counsel for his defence.

            Bold mine. Rothbardianism tosses out a good deal of what is meant to protect people’s rights. It doesn’t matter if the system that he (Rothbard) would’ve had in put in its place worked more efficiently than the current setup because these things are supposed to be tedious.

            • Major_Freedom says:

              ““Private judicial rulings” would be tantamount to hit contracts. No accountability, no rule of law, and no public records.”

              False. There would be accountability, there would be a rule of law, and there would be records.

              All you’re saying with that quoted comment is that there wouldn’t be governmental accountability, rule of law, or records. Well duh.

              “Rothbardianism tosses out a good deal of what is meant to protect people’s rights.”

              What you assert as “what is meant to protect people’s rights”, namely the state, in practise does not only not protect people’s rights, but by its very nature violates people’s rights.

              In order for the state to even arise and exist, individual rights of some people must be violated by other people. If no rights were ever violated, then the state would be incapable of existing at all.

            • Tel says:

              Runaway bold .
              Buggy blog software…

          • Samson Corwell says:

            Testing.

          • Samson Corwell says:

            I think you might need to fix my comment with the bold text because I think missing a bold tag screwed up the entire thing.

            • Major_Freedom says:

              Don’t worry, what you said is probably better presented in annoying typeface. Fitting.

              • Samson Corwell says:

                It ruined the whole page.

              • Major_Freedom says:

                I’m going to go ahead and say it’s still fitting, hahaha

    • Major_Freedom says:

      “Are you arguing that if murder were decriminalized we would have less violent murderers?”

      Why do you keep conflating selling goods to the highest bidder with selling bads to the highest bidder? You did this before in another thread where you claimed that private production of defense is the same thing as selling murder services, or robbery services.

      The argument that decriminalization of X leads to less violence caused by criminalizing X, is constrained to peaceful exchange of goods, not violent involuntary impositions of bads.

      For example, ending alcohol prohibition lead to less violence caused by prohibition of alcohol.

      This is not open the challenge that the same logic implies that decriminalizing murder leads to less murder. This is because the logic does not apply. The key issue is removing an introduction of violence where there is otherwise peace. This is what is being referred to with the term “decriminalization”. To de-criminalize what is not an initiation of violence, must invariably lead to less violence.

      Imagine a household with a violent individual who constantly taunts and picks fights with the other household members. His actions would likely result in the other household members fighting back. More people are engaging in more violence because of one person who keeps introducing violence. If we imagine that this individual is picking fights because he wants to make illegal the changing the television station during the evening news, then decriminalizing channel surfing would reasonably be expected to lead to less overall violence, because when that individual ceases picking fights on the basis of channel surfing, the other household members have no reason to use violence themselves, because they’re not being picked on any more. There would likely be less violence between the other household members as well, due to being able to cooperate with each other finally, and not have to jockey for position in the hierarchy of violence.

      Decriminalizing peaceful activity, and reducing violence not only from the wagers of the drug war, but the victims of the drug war who are fighting each other to gain position in the violent environment, is what ending the drug war is all about. If we can get drug sellers and manufacturers to compete with each other in the market, instead of competing against each other violently due to drug selling being illegal, then violence would be reduced. Killings would be reduced.

      • razer says:

        Unfortunately, this point will sail over Ken’s head. He still confuses the act of self defense against violence with the initiation of violence. Asking him to comprehend simple things is like teaching my cat a card trick. It’s fun for a few minutes then it gets old quickly.

        • Major_Freedom says:

          Maybe use a laser pointer and wiggle the dot near Austrian textbooks.

  2. martinK says:

    If you want to look at organizations operating outside of state control in the current world, you can look at drug cartels as Gene does, but you can also look at states (governments) themselves. There’s no super-state that will prosecute the US government if it invades Canada, yet the last time this has happened has been 200 years as far as I know.

    • Ken B says:

      Wow, what my friends say is true. Americans always try to forget the war of 1926, when we crsuhed you!

      • martinK says:

        Apparently Americans are so desperate to forget about that one that they even censored the internet, because I can’t find anything about it.

        • Ken B says:

          I’m not surprised. A few details about the Kennedy plot came out, and area 51, but the war of ’26? Perfect silence.

      • Tel says:

        Most Canadians refer to the War of 1812 in which the British burned Washington (Canada being part of the Commonwealth at the time).

        http://boards.straightdope.com/sdmb/showthread.php?t=63222

        • Ken B says:

          Yeah but Martin was referring to that one with his 200 years. It’s the great war of ’26 that the Yanks suppress. Don’t even bother searching. The truth of this war can only be known by a priori reasoning. Empirical evidence is fruitless.

        • Harold says:

          “Canada being part of the Commonwealth at the time” Still is. Dear old Queen is still head of state too.

  3. Harold says:

    That cannabis dealers are less violent than cocaine dealers may just be an indication of lower margins due to factors unrelated to criminality. Cannabis can easily be cultivated all over the USA, cocaine has a more limited supply. Maybe it just competition.

    • Major_Freedom says:

      Profit margins on cocaine are so high because the risk of producing and selling it is so high.

      Cocaine COULD be produced in the US as well. I’m pretty sure California and Florida has the requisite weather to facilitate the planting and farming of coca leaves.

      But it’s not even necessary for that to occur for the price to fall. Cocaine can be produced in China for cheap and exported to the US, like they do plasma televisions.

      The majority of profits from cocaine are due to a requirement to reward the investors from taking on such high risk.

  4. Lee Waaks says:

    I made this point/reference the other day, but I think it worthwhile to make it again: Michael Huemer, in his book, The Problem of Political Authority, points out that the vast majority of people, now more than ever, are “anti-murder”, but many who are drawn into the drug business, due to the high profit margin — and I think Bob’s point about cocaine vs. pot certainly applies here — are not anti-murder. So, I don’t think it is entirely relevant to compare, e.g. Exxon exectives with the thugs who run the cocaine trade.

    • Ken B says:

      Then why, when according to Huemer support for murder was higher, wasn’t TI taken over by thugs? There have been lots of high margin businesses not taken over by Capones. So high profit margins are not enough by themselves to explain it.

    • Matt M (Dude Where's My Freedom) says:

      I’d like to see some sort of source on that.

      I think now more than ever people CLAIM to be anti-murder, but I don’t think they necessarily are, we’ve just invented elaborate mechanisms by which people can avoid getting their own hands dirty, so they can continue to yell and scream about hating murder, while simultaneously voting for politicians who will murder, on their behalf, constantly.

      As discussed in a previous post here on Free Advice, we haven’t eliminated the act of the community getting together and killing someone it doesn’t like, we’ve just changed the mechanism. While it used to require everyone in town getting together and personally throwing stones at whoever it was they didn’t like, now we just vote for a politician who siphons off some of our money and pays it to a contractor who pilots a remote vehicle to blow up whoever it is we don’t like.

      This allows the average voter to FEEL like they themselves were not a part of this action. They may pass judgment on their savage and primitive ancestors who committed the terrible act of community stonings, while not realizing that they themselves are also culpable for similar deaths at the hands of the modern staet.

  5. Blackadder says:

    So, if Callahan is right, then we should see pot dealers acting as violently as cocaine dealers. But if I’m right, we should see much less violence when it comes to the distribution of marijuana, compared to cocaine. And although I couldn’t find hard numbers to back it up, I think casual observation says that pot dealers are clearly less violent, as a general rule.

    Um.

    • Matt Tanous says:

      The cartels are not often the dealers. Retail v. production. Even if the same cartel grows the pot as produces the cocaine, the guy selling pot in a shop in Denver is not shooting up the place.

      • Blackadder says:

        When I was working for the U.S. Attorney, different gangs would specialize in different drugs (i.e. a gang that dealt cocaine probably wouldn’t deal crack and visa versa). The big exception was marijuana, which all the gangs dealt.

  6. Bob Murphy says:

    I was going to make the statement: “People who buy water are less violent, as a general rule, than people who buy AK-47s.” But then I realized the zinger Blackadder could hit me with.

    • Bob Murphy says:

      I’m not sure how my flute playing is relevant, but it’s funny how Gene and I keep thinking we’re destroying the other guy.

      • Ken B says:

        So you’re saying it’s just a flesh wound?

        • Bob Murphy says:

          No, I’m saying Gene was fatally wounded in round one, and after round two the coroners have to check dental records to be sure it’s still him.

  7. Harold says:

    How about this?
    http://www.yorkshireeveningpost.co.uk/news/latest-news/top-stories/leeds-ice-cream-turf-war-turns-vicious-1-2223842

    “There is a turf war within Leeds as well. They have threatened people and smashed vans. Last week a guy came to my house and was trying to intimidate my son.

    “There has never been regulation. This needs to change.”

    Mr Ramzan also wants to see a zoning system and heavy fines….
    A Leeds City Council spokesperson said the authority has no powers to licence the ice cream van trade , however if anyone is experiencing threats or intimidation, they should contact the police.”

  8. Ken B says:

    Where’s Lord Keynes when you need him? Well I guess I must fill in.

    “Liberalism differs radically from anarchism. It has nothing in common with the absurd illusions of the anarchists. We must emphasize this point because etatists sometimes try to discover a similarity. Liberalism is not so foolish as to aim at the abolition of the state. Liberals fully recognize that no social coöperation and no civilization could exist without some amount of compulsion and coercion. It is the task of government to protect the social system against the attacks of those who plan actions detrimental to its maintenance and operation. ”

    Couldn’t have put it better myself!

    • Major_Freedom says:

      Please note that Mises had in mind the left wing, molotov cocktail throwing anarchists, who wanted no compulsion from anyone else, not even to protect private property.

      The previous paragraph, he writes:

      “There is a school of thought which teaches that social coöperation of men could be achieved without compulsion or coercion. Anarchism believes that a social order could be established in which all men would recognize the advantages to be derived from coöperation and be prepared to do voluntarily everything which the maintenance of society requires and to renounce voluntarily all actions detrimental to society. But the anarchists overlook two facts. There are people whose mental abilities are so limited that they cannot grasp the full benefits that society brings to them. And there are people whose flesh is so weak that they cannot resist the temptation of striving for selfish advantage through actions detri­mental to society. An anarchistic society would be exposed to the mercy of every individual. We may grant that every sane adult is endowed with the faculty of realizing the good of social coöperation and of acting accordingly. However, it is beyond doubt that there are infants, the aged, and the insane. We may agree that he who acts antisocially should be considered mentally sick and in need of cure. But as long as not all are cured, and as long as there are infants and the senile, some provision must be taken lest they destroy society.”

      Anarcho-capitalist philosophy presumes none of the things Mises disparages about the anarchists of his day.

      • Ken B says:

        Which is it to be MF? Are you pitching a society without compulsion or coercion? You must be because when I say you want a market in those commodities you cry NO! But to rebut Mises here you cry YES!

        • Samson Corwell says:

          He’s interfering in the market for bomb throwing and destruction. Damn central planner.

          • Major_Freedom says:

            Market for bomb throwing is a contradiction in terms.

            Markets are voluntary exchanges and voluntary dispositions of private property.

            Bomb throwing makes the above impossible, to the extent that it is aggressive and not defensive.

        • Major_Freedom says:

          “Are you pitching a society without compulsion or coercion?”

          Careful about the terminology here Ken B. Compulsion and coercion is to Mises “the use of force” without qualification. That means we cannot exclude either aggressive uses of force nor defensive uses of force.

          When Mises argued that compulsion and coercion are necessary for civil society, he meant using force and compulsion to stop violent criminals is necessary. He didn’t mean Hitler or Stalin action is necessary.

          So I am “pitching” a society with the kind of compulsion Mises wrote about, namely, a society with defensive uses of force to stop aggressive uses of force.

          If you read Mises closely, you’ll see he was an ideological anarchist, but a practical minarchist. That is, he was in full ideological support of secession down to the individual level, but he believed that technology (knowledge) was inadequate to make it a possibility during his life, and so he thought for practical reasons a nightwatchmen state is required.

          Mises’ disparaging of “anarchists” was against the left wingers who believed there should be no police at all, not even private police. Those who flouted all lawful behavior.

          I am confident that if Mises were alove today, and Hoppe, Block and Murphy sat down with him for a few weeks and explained what anarcho-capitalism is all about, Mises would likely not reject them as the “bad” anarchists of his day.

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