10. Rothbard’s System of Ethics

ROTHBARD’S SYSTEM OF ETHICS

Although Rothbard usually found himself in close agreement with Mises, in one area he maintained that Mises was mistaken. Mises contended that ethical judgments were subjective: ultimate ends are not subject to rational assessment. Rothbard dissented, maintaining that an objective ethics could be founded on the requirements of human nature. His approach, based on his study of Aristotelian and Thomist philosophy, is presented in his major work The Ethics of Liberty,²⁴⁰ his most important study of political philosophy.

Even if Rothbard is right that an objective ethics is possible, is this view essential to libertarianism? Why abandon Mises?

According to Mises, we can defend the free market without resorting to any controversial assumptions about the nature of ethics. One can demonstrate, without making any value judgments, that interventionist measures such as minimum wage laws fail to achieve the goals of their own advocates. If so, we have a value free defense of resistance to such measures and the free market is vindicated. Does this not suffice?

Rothbard did not think so. As he points out, interventionist measures do help some people, albeit at the expense of others. Labor unions, e.g., may raise the wages of their members, while causing others outside the union to lose their jobs. Why should one think that this result is, from the point of view of the union members, unsatisfactory? Contrary to Mises, then, interventionist measures do not always fail to attain the goals of their advocates. A value-free defense of the market cannot then stand by itself.

Rothbard first indicated his differences from Mises in a comment on Mises’s paper, “Epistemological Relativism in the Sciences of Human Action,” delivered at a Symposium on Relativism sponsored by the Volker Fund. He states his essential criticism forcefully:

But how can Mises know what motivates the statists? Suppose, for example, the price controller wants power, and doesn’t care if it creates shortages... (or is a nihilist and hates everyone, and wants to create shortages); suppose that someone who wants to confiscate the rich has a very high time preference and doesn’t care if the economy will be wrecked in twenty years. What then?²⁴¹

In Rothbard’s ethical system, self-ownership is the basic principle; each person rightfully owns his or her own body. Few libertarians would dissent; but few, if any, have seen the implications of this principle so clearly as Rothbard.

To many libertarians, freedom of contract is the be-all and end-all. Rothbard disagrees: unlimited freedom of contract, far from being a consequence of self-ownership, in fact contradicts it. Given self-ownership, and acquisition of property through “mixing one’s labor” with unowned property, one of course may freely enter into all sorts of agreements with others. Nevertheless, unlimited “freedom of contract” is unacceptable.

Unfortunately, many libertarians, devoted to the right to make contracts, hold the contract itself to be an absolute, and therefore maintain that any voluntary contract whatever must be legally enforceable in the free society. Their error is a failure to realize that the right to contract is strictly derivable from the right of private property, and that therefore the only enforceable contracts ... should be those where the failure of one party to abide by the contract implies the theft of property from the other party.²⁴²

It follows from Rothbard’s understanding of contract that one cannot sell oneself into slavery. One can voluntarily submit to the will of another; but no legal force can compel someone to remain faithful to such a submission; to reiterate, contract does not stand as an absolute. Here, as is often the case, Rothbard disagrees with Robert Nozick, who held that contracts to sell oneself into slavery could be enforced.

Rothbard uses the principle of self-ownership to solve a complicated problem of legal theory. What is the basis for enforcing a contract? According to some legal theorists, including such eminent figures as Oliver Wendell Holmes and Roscoe Pound, a contract is in essence a promise. A variant of this position holds that a contract leads the parties to expect behavior of a specified kind. They accordingly plan their own actions and suffer loss if their expectations are disappointed. To help ensure that expectations are met, contracts may be enforced.

Rothbard easily dispatches these theories. Both contract-as-promise and contract-as-fulfilled expectation negate self-ownership: one may alienate only one’s property, not one’s will. He draws the drastic, but strictly logical, consequence that no promise as such can be enforced. Every legally binding contract must involve a transfer of titles between the parties at the time the contract is made.

His conclusion follows from his premise; but why accept the axiom of self-ownership, as Rothbard interprets it? He argues that all societies confront three alternatives: each person owns himself, some persons own others, or each person owns a part of everyone else. (Are these alternatives mutually exhaustive? Variants and combinations of the second and third may readily be devised, but these require no change in the fundamentals of Rothbard’s argument.)

George Mavrodes objected that Rothbard had made an unwarranted assumption. Rothbard asks, who should own people? But why assume that people should be owned at all? As Rothbard uses the concept of ownership, however, Mavrodes’s question lacks a point. By “ownership,” Rothbard means “control”; and it is indeed the case that someone (or group) must control each person. Rothbard’s alternatives cannot be escaped.

Given these alternatives, which should one choose? In his response, Rothbard relies heavily on a point of fact. Everyone is in reality in control of his own will. If I obey another, I must always make the decision to do as he wishes; and the threat of violence on his part should I follow my own course leaves the situation unchanged. I must decide whether to accede to the threat.

But, one might object, even if Rothbard is correct that one cannot alienate the will, how does he get to the conclusion he wants? From the fact that the will cannot be alienated, how does the ethical judgment follow that each person ought to be recognized as a self-owner? Is Rothbard here committing the fallacy of deriving an “ought” from an “is”?

To our imagined objector, Rothbard would demur. He does indeed derive an “ought” from an “is,” but he would deny that he is guilty of any fallacy. He maintains that ethical principles follow from the nature of man. The fact that each person has control of his own will implies that the attempt to coerce the will of another is unjustifiable—to do so is to attempt to violate human nature. This prohibition does not apply, Rothbard holds, once violence has been initiated. Here one may respond with all necessary force, and Rothbard carefully elaborates a theory of retributive punishment.

Once self-ownership has been established, property rights soon follow: one acquires property through “mixing one’s labor” with unowned property, or by acquiring such property in gift or exchange from someone else. Rothbard displays great dialectical skill in anticipating objections to his theory. One of the most important of these is that if one may acquire property through Lockean labor mixture, does this not unfairly bias matters in favor of the first possessor? Imagine a group of shipwrecked sailors swimming toward an uninhabited island. Does the first person to reach the island acquire it? Can he then refuse entry to his shipmates, unless they pay exorbitant rents to him? The political philosopher G.A. Cohen later raised exactly this objection to libertarianism, without reference to Rothbard’s discussion.²⁴³

Rothbard easily turns aside the objection.

Crusoe, landing upon a large island, may grandiosely trumpet to the winds his “ownership” of the entire island. But, in natural fact, he owns only the part that he settles and transforms into use.... Note that we are not saying that, in order for property in land to be valid, it must be continually in use. The only requirement is that the land be once put in use, and thus become the property of the one who has mixed his labor with, who imprinted the stamp of his personal energy upon, the land.²⁴⁴

We may imagine another objection at this point. Suppose Rothbard has successfully rebutted the contention of Georgists and others that first possessors of land can in his system hold to ransom all others. Is not the system, however logical, of no practical relevance? Most property titles today do not stem by a clear line of transmission from a Lockean first owner. On the contrary, would we not find that many land titles go back to acts of violent dispossession? Would not an attempt to put Rothbard’s system in practice quickly lead to a war of conflicting claims to property?

As usual, Rothbard has thought of the objection himself. He answers that the burden of proof lies on someone who disputes a land title to make good his claim. If he cannot do so, the present possessor owns his land legitimately. If land titles cannot be traced back to an original act of legitimate appropriation, speculation about an original owner and his present descendants is idle.

But what if the objector can make good his claim? Then Rothbard is entirely prepared to follow out the implications of his system. Many landowners in Latin America and elsewhere would in a Rothbardian world find themselves in very much reduced circumstances:

[A] truly free market, a truly libertarian society devoted to justice and property rights, can only be established there [in the underdeveloped world] by ending unjust feudal claims to property. But utilitarian economists, grounded on no ethical theory of property rights, can only fall back on defending whatever status quo may happen to exist.²⁴⁵

Rothbard’s Ethics is in one sense mistitled. He sharply distinguishes political philosophy from ethics as a whole, and his book is addressed principally to the former topic.²⁴⁶

When, e.g., he deduces from the nonaggression axiom that people ought to be free to make any voluntary exchange they wish, his conclusion, like his premise, is part of political philosophy. He makes no attempt to argue that every voluntary exchange is morally desirable. It follows, Rothbard contends, from sound political principles that blackmail ought not to be legally prohibited: it is the sale of the service of withholding information from interested parties. As another example of the iron consistency with which Rothbard is willing to pursue his conclusions in the face of commonly held beliefs, parents should be under no obligation to care for their infant children.

Some would at this point throw up their hands in outraged horror. But one may hope that before doing so, anyone who reacts negatively will consider the main issue. Rothbard in no way suggests that blackmail or parental neglect is morally permissible. His moral opinion of these practices is just the same as that of most people. But from the fact that an activity is immoral, it does not follow that it ought to be legally banned. Indeed if Rothbard is right about political morality, it will often be immoral to attempt to prohibit immoral activity. This seeming paradox, instead of undermining morality, actually serves as an important means for its defense. One has only to glance at any period of history to see that the main violator of morality has been what Nietzsche called “that coldest of all cold monsters, the State.” A doctrine, like Rothbard’s, that rigidly restricts the role of politics in the enforcement of morality can only be welcomed from the moral point of view.

A substantial part of The Ethics of Liberty is devoted to Rothbard’s criticisms of other classical liberals, including Mises, Hayek, and Isaiah Berlin. His discussion of Robert Nozick is especially noteworthy. As he points out, a key part of Nozick’s defense of a minimal state depends on an equivocation. Nozick’s argument is a response to Rothbard’s contention that, ideally, protective services should be provided by competing private agencies. A compulsory monopoly agency, i.e., a government, is neither necessary nor desirable.

Against Rothbard, Nozick deploys an argument that at first sight seems devastating. Grant Rothbard his private market anarchism, Nozick suggests. Then, in a way entirely consistent with Rothbard’s system, a monopoly agency will spring up. Rothbard’s system defeats itself.

Rising to the challenge, Rothbard locates a crucial weakness in Nozick’s argument. Nozick concerns himself greatly with cases in which protection agencies clash over the appropriate procedure to use in trials of criminals. One outcome that Nozick canvasses is an agreement among the agencies to establish an appeals court.

So far Nozick is on the right lines, and Rothbard himself lays great stress on the need for agreements of exactly this kind. But, according to Nozick, agencies that thus come to agreement have coalesced into a single agency. Rothbard finds this step in Nozick’s argument unreasonable: do disputing companies that agree to arbitration constitute by that agreement a single firm? Nozick has “refuted” Rothbard through the use of an arbitrary definition.

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²⁴⁰The Ethics of Liberty (1982; New York: New York University Press, 1998).

²⁴¹Rothbard’s comment on Mises’s paper at Volker Fund Symposium; Rothbard Papers; emphasis in the original.

²⁴²The Ethics of Liberty, p. 133; emphasis in the original.

²⁴³See G.A. Cohen, Self-Ownership, Freedom, and Equality (Cambridge: Cambridge University Press, 1995).

²⁴⁴Ethics of Liberty, p. 64; emphasis in the original.

²⁴⁵Ibid., p. 70; emphasis in the original.

²⁴⁶Vittorio Hösle notes that this division is prominent in the political philosophy of Fichte. He held that cruelty to animals, e.g., though morally wrong, could not be banned by the state. See Vittorio Hösle, Morals and Politics (North Bend, Ind.: University of Notre Dame Press, 2004), p. 642.