LibertarianismLibertarianism, in the strict sense, is the moral view that agents initially fully own themselves and have certain moral powers to acquire property rights in external things. Its main principle is that each agent has a right to maximum equal empirical negative liberty, where empirical negative liberty is the absence of forcible interference from other agents when one attempts to do things.

In practice, it mainly refers to a largely American political and social philosophy that advocates laissez-faire capitalism as a solution for all problems. Libertarians generally advocate a society with a government of small scope relative to most present-day societies or no government whatsoever. Libertarians believe government is the biggest threat to freedom, because they think it interferes in the lives of its citizens, and does much more harm than good.


Many libertarians are inspired to their political philosophy through one of a small number of influential fiction books. The works of novelist Ayn Rand (The FountainheadAtlas Shrugged) and Robert Heinlein (The Moon Is a Harsh Mistress) are often cited.

The only proper functions of a government are the police, to protect you from criminals; the army, to protect you from foreign invaders; and the courts, to protect your property and contracts from breach or fraud by others, to settle disputes by rational rules, according to objective law.—Ayn Rand, The Virtue of Selfishness

Its economic foundation is based upon game theory developed by John Nash. Contributors to libertarian thought include Isaiah Berlin and James M. Buchanan.

Economic game theory, or the “virtue of selfishness”

Around the 1940’s, after the Second World War and the Great Depression, politics in America was seen as a means of ensuring freedom by acting as a counterbalance to unrestrained free market capitalism, taming the dangers of greed and self-interest that lay at its heart. However, this began to gradually change under the influence of various economists, who thought that restraint in the market ultimately led to tyranny (similar argument to anarchists) and that unrestrained free markets should determine politics, not the other way around, as they argued that they would be better equipped to respond to people’s desires. Their assumption was that human beings are isolated, machine-like, purely self-interested individuals, and from that, any form of action that was declared as “altruistic” or “for the benefit of society”, any coercion imposed upon the market or people “for their own good” must have an ulterior motive, and therefore is to be frowned upon. By this “logic” they set to build a system that encouraged “self-interest” and discouraged “idealists”, or “zealots” as they called them, that were not as easily motivated by monetary incentives.

In a society where everyone were looking out only for their own self-interest, stability would result. The most famous mathematical theorem encompassing this fact is the Nash Equilibrium theorem. Economists use a model called perfect rationality to predict how fully self-interested agents behave.

Origins in the cold war

Game theory was used in the cold war in order to avoid nuclear conflict. The resultant “equilibrium strategy” was, paradoxically, to make an increasing amount of nuclear missiles, in order to maintain peace. The idea was that mere possession of more missiles than the enemy (Russia) could act as an incentive for the enemy not to attack, i.e., would let Russia know that they were outgunned if they were to attack. Only later were these ideas extended as a model for every aspect of society, despite the fact that society by its very name (social) originated with the idea of trust and collaboration.

The prisoner’s dilemma

An example of application of “perfect rationality” :

Player B cooperates Player B defects
Player A cooperates Both get $100 Player A: $0
Player B: $101
Player A defects Player A: $101
Player B: $0
Both get $1

A “perfectly rational” agent would strategise like this: First, consider the other player’s choices as already “frozen”, even though technically, they are more or less simultaneous to his and hidden from one another. Second, the other player’s choices matter only insofar as they affect your profits, not his.

To illustrate, assume Player A would be perfectly rational:
If B cooperates, A wins $100 if he cooperates, and $101 if he defects. So in that case he should defect. If B defects, A wins $0 if he cooperates, and $1 if he defects. Therefore, in this case he should also defect. Thus, the “rational conclusion” for A is that he should always defect, thus apparently maximizing his profits.

However, let’s look at this in context, for example in a society. Two “perfectly rational” agents would always win $1 each, an outcome that hardly seems rational, while two “irrational”, altruistic individuals would win $100 each. However, unfortunately, an altruist playing with a “perfectly rational” agent would always get duped.

The always defects strategy is a stable equilibrium, in the sense that if any player knew beforehand that every other player is perfectly rational (always defects), he would have no reason to cooperate, or be altruist, the only choice being to defect (be “perfectly rational”). This strategy does not guarantee optimum results.

The always cooperates strategy, by contrast, guarantees optimum results, but is an “unstable equilibrium”; players can choose to defect for their own benefit at the cost of the whole.
Attempting to translate abstract mathematical theorems into more or less concrete statements, we obtain the following potential simplifications :

1) A system where everyone is self-interested, in the game-theory sense, is stable, but not optimal by a far cry. No one has any motivation to change to a more altruistic strategy, knowing everyone else, unchanged, would exploit them for it. This is basically Nash Equilibrium.

2) A system where everyone is altruistic would be far closer to optimum, but unstable. If a small percentage of players become purely self-interested, and there are no rules to restrict their behavior, they can obtain greater benefit than the altruistic ones, at the expense of a decrease in the average benefit of all players.

3) Provided all players become purely self-interested, the benefit may drop significantly; we return to Nash Equilibrium.

Regardless of the problems introduced by potential oversimplification, we see that greed, however, is as a premise not justified anywhere in these equations. Greed is not rational; it is a rationalization. Empirical studies have shown that the majority of people do not in fact behave like Nash’s “self-interested agents”. In fact the only two groups of people who fit the “model” were economists themselves and psychopaths.

Stability, an abstract term, is the only possible advantage that could be said of such a system. In practice, application of these policies led to a decline in social mobility and increased social stratification and economic inequality.

Money is value

In a purely capitalist “society”, libertarians argue, due to the aspects of supply and demand, money would automatically reflect the value of its proprietor. This shows lack of familiarity or understanding of the historical aspects of capitalism as dialectic. Value is usually a cumulative, intrinsic property of the individual, while money is a resource, the value of which is given by social laws. If the intrinsic or potential value, the social mechanism for developing and measuring value (to the extent that they exist), and the social mechanism for accumulating money are decoupled, the libertarians’ point is moot. Libertarianism does not have a social mechanism for developing and measuring value (it’s not conducive to pure self-interest). The individual owes nothing to society, and society owes nothing to the individual.

The statement that money reflects value can be broken into two parts:

1) If someone has money, they will automatically be of value. Laissez-faire capitalism leads to the accumulation of wealth in the hands of a very few rich families to be passed dynastically, not unlike monarchies. The value of the inheritors is no more real than that of monarchs. Most of the time they simply get more possibilities for their mediocre abilities, e.g., George W. Bush, Paris Hilton, than masses of more talented people.

2) If someone has value or potential value they will automatically accumulate money. Libertarian policies, due to lack of power in social institutions, result in decreased social mobility. Somebody born poor will likely never get the means to develop or use their abilities, as it’s not in the interests of the rich.

Meritocracy, by contrast, both seeks to maximize the value of each citizen (positive liberty) and attempts to allow money to properly reflect the value of the individual (resulting in a much more egalitarian distribution of wealth).

Narrative structure

The narrative structure of libertarianism, having its roots in objectivism, is, ironically, an inversion of the narrative structure of Marxism (in the same way the Gnostic and Christian versions of the Garden of Eden tale are inversions of one another). The rich industrialists are portrayed via their self-interest, to be, paradoxically, humanity’s greatest benefactors, indispensable in its ongoing progress. The working class, by contrast, are portrayed as “parasites” and “looters”. By that logic, any measure that is perceived as damaging the profits of the industrialists (any form of taxing, for example) is seen as bad.

The Randian “exodus”

Atlas Shrugged promotes the myth that money reflects value, and that the rich should have as little regulation as possible. In the novel, once they go on strike society is devastated, and they return to create the new world, in a libertarian image. In reality, this is a myth, like the infallibility of the Wizard of Oz, as he hides behind the curtain. The rich are the first to know that such a strike would never happen; if it did, given their actual merit, the world would probably be better off.

Property is sacred

Libertarians claim that each individual in entitled to the fruits of his or her own labor; therefore property is an inviolable right, and owners can do whatever they wish with their property.

While the premise is true, the conclusion is problematic. This view of the world is far more atomistic and isolationist than that of reality. While individuals are entitled to “self-ownership”, property is not created ex-nihilo, and its function depends upon its interconnectedness in social, political, economical, and natural systems.

Assume a small number of people claimed ownership to the majority of resources, as often happens in laissez-faire capitalism. The rest of the population, in libertarian thought, then would posses nothing but “self-ownership”, and freedom from interference, that is, negative-liberty (“empty” liberty), but would have little effective, or positive, liberty, a means of accomplishing their goals. They would be forced to work for the property-owners at whatever conditions they choose to impose upon them, or starve. That can hardly be considered liberty.

The only valid “natural right” is the “right” of might. In a society, the social contract which sacrifices the natural liberty of man (state of nature) must offer considerable positive and civil liberty in return. Throughout history, revolutions, revolts, and labor wars have been waged when this principle was not respected.

Furthermore, the libertarian doctrine makes “original appropriation” (as initially, no one owns anything) problematic, even impossible. When acquiring ownership of an unowned resource, you are implicitly depriving others of the possibility of making use of that resource, thus necessarily violating their liberty, for example, appropriating the local food source and preventing anyone else from using it.

“The only way you could acquire an absolute right over a natural resource would be if everyone else consented to the appropriation, i.e., if they voluntarily sacrificed their liberty for your sake. (Perhaps you could offer them some incentive, e.g., a share of the profits, in exchange for this sacrifice.) But since the ‘everyone’ in question includes future generations, this is a condition that can never be met.

There is a moral obligation, when taking from the world’s natural resources, to leave ‘enough and as good’ for others. This prevents any absolute property rights from ever being granted, once we take future generations into account. At best, one might acquire a conditional property right that limited the ways one could dispose of the resource—it might require responsible and sustainable consumption, or the subsequent transference of the right to others in greater need, and so forth .“—(approximate quote)


A period of history known as the Gilded Age (name is a parody of the “Golden Age”), lasting somewhere between the second half of the nineteenth century, due to low taxes and little to no regulation, most accurately reflects the libertarian vision. While this period generated great economic growth, it also had the longest known depression (1873-1879; compare “Great Depression” 1929-1933). Labor wars were also present. Strikes and outbreaks of violence became more common as a result of unsafe work conditions and low pay. Safety laws and regulations were virtually nonexistent. Also, child labor was widespread. Ironically, the free marketeers of the time argued that to restrict child labor would be an infringement on free market principles, and that economic freedom, if it were limited, would ultimately lead to economic doom. Another aspect were company towns, which were often little more than shantytowns and tent cities for workers, where the company dictated everything.

Roads generate no profit to anyone in particular, yet benefit all, and could not have been built in a purely libertarian vision of society (or at least, usage would be taxed).

Libertarians separate society from the individual and pit one against the other, ignoring the fact that society is the sum of all individuals. On similar grounds, they use the language of “reason” to justify greed, and the language of “freedom” to justify isolated, negative liberty (particular will, freedom from external constraints or coercion, “I am no one’s slave”) while denouncing positive liberty (freedom for a purpose, made possible through the general will and representative of it, freedom from internal constraints, freedom to become rational, ability to actually achieve one’s potential and desires, “I am my own master”) because it involves coercion and has the possibility of leading to tyranny. They forget that positive and negative liberty are in a dialectical relationship, like the individual and society, and increase in the first may generate increase in the second. The simplest example is providing proper education for all citizens. While not all citizens could have otherwise afforded education, and such a system inevitably requires coercion or taxes, it is a positive liberty (education) that leads to greatly increased negative liberty (possibilities) for all citizens.

As historically shown, libertarian ideology leads to oligarchic corporate rule, with corporate hierarchy, ironically, bearing strong resemblance to government hierarchy, with the sole exception that government, at least in principle, represents the people and is committed to the well being of all its citizens via reflection of the general will. Capitalist corporations represent only the owners; their sole purpose is to generate profit, not the well being of workers, any benefit to society being incidental.

“He always pictured himself a libertarian” means “He wants the liberty to grow rich, and you can have the liberty to starve.” It’s easy to believe that no one should depend on society for help when you yourself happen not to need such help.—Isaac Asimov, A Memoir

Meritocracy aims to achieve a “Double Holos”, a perfect, whole individual within a perfect, whole community, the whole being more than the sum of its parts. It exploits the dialectical relationship between positive and negative liberty, to achieve true freedom. The aim is to utilize psychology, the dialectic, and the scientific method to create a society of equal opportunity, one where rewards will reflect value, and value will be maximized. Selfishness, egotism, cruelty, vanity, greed, and division must be overcome in such a community. The state has at its disposal far more resources than the individual, from which we derive its capacity to exist in a dialectical relationship with the individual, to the benefit of both, as the individual is part of the state. Libertarians complain about taxes. Paradoxically, other than inheritance tax or “death tax”, which you do not pay while alive, Meritocracy shouldn’t require other taxes.

Superrationality, an alternative game-theory model to “perfect rationality”

As illustrated with the prisoner’s dilemma, “perfect rationality”, the mainstream model used by economists, often leads to irrational (suboptimal) decisions (compared to “altruism” or general statistical human behavior). The mathematics of the theory is correct; nonetheless, the results seem absurd, so it must be “metaphysical assumptions” of libertarianism that are wrong.

  • The concept of superrationality was coined by Douglas Hofstadter (author of Gödel, Escher, Bach) in his article series and book Metamagical Themas.

As of yet, there is no commonly agreed upon extension of supperrationality to asymmetric games.

The prisoner’s dilemma, reconsidered

Player B cooperates Player B defects
Player A cooperates Both get $100 Player A: $0
Player B: $101
Player A defects Player A: $101
Player B: $0
Both get $1

Assume two superrational players play the prisoner’s dilemma, each knowing that the other is superrational. The game is symmetric, so in that sense, the superrational players, like the “perfectly rational” ones, find themselves in completely identical situations. There is no “freezing of the other player’s choices”. Since superrational players notice the symmetry, they know, via the unity of reason, that they will arrive at the same answer, even without communicating. So, their choices are that either both defect and leave with $1 each (as the “perfectly rational” players have done) or both cooperate and leave with $100 each. The answer is obvious: both will cooperate, maximizing payoff. Far from being irrational, cooperation might in fact be superrational.


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One Response to “Libertarianism” Subscribe

  1. Casper Saul March 30, 2013 at 3:00 am #

    What a great article. The ending is beautiful. Superrationality is like rationality with accurate empathy–rationality that recognizes the living minds of others.

    I like the tables and graphics here too. Nice job whoever set those up.

    I shared this article on Facebook. One of the best summaries and refutations of libertarianism out there–gets right to the heart of it–even though many people might find it a little too complex to understand.

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