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Stateless Defense - Funding for External Threats


I don’t doubt the efficacy of a stateless guerrilla war given certain unrealistic assumptions.

If an area was filled with true-believer anti-statist ideologues like me, they would be just as successful as Afghans, Vietnamese, and the like if not more so. 

And there are many people who are not full-blown anti-statists but confused constitutionalist militiamen who would fight in what is essentially an anti-statist guerrilla war.

But this is not an answer.

A passage from Bruce Catton’s book, Never Call Retreat, enunciates my position on the matter better than I:

"To him, as he prepared to meet Grant, came a trusted lieutenant who urged him not to surrender but simply to tell his army to disperse, each man taking to the hills with his rifle in his hand: let the Yankees handle guerilla warfare for a while and see what they could make of that.

Lee replied that he would have none of it. It would create a state of things in the South from which it would take years to recover…

The unquenchable guerrilla warfare this officer had been hinting at was perhaps the one thing that would have ruined America for ever. It was precisely what Federal soldiers like Grant and Sherman dreaded most — the long, slow-burning, formless uprising that goes on and on after the field armies have been broken up, with desperate men using violence to provoke more violence harassing the victor and their own people with a sullen fury no dragoons can quite put down.”

A problem today is that people aren’t willing to live and fight in such a way for some “cause”. This is the main issue that is preventing people from becoming anti-statists / anarcho-whateverists, and it is what causes anti-statists to revert to statism. And what I have also found is that when they see just how shabby the anti-statist arguments for defense are, they become hypercritical on everything else and regress, and begin to call into question defense against not only other states, but against internal warlords and the feasibility of polycentric law as well and they develop a bias against anti-statism stronger than anyone who never was an anti-statist.

ZamatoElite posted a comment on Spawk’s video saying he didn’t know how I would recover from this - referring to Spawk’s conversion to white nationalism. We’ll see.

I had toyed around with the notion of a standing army in a stateless society, noting that the total monetary amount needed to spend on a military would not be extraordinary, something like 1% for the former US would be more than enough to handle any other state invader. But I had left it at that, and said “somehow, they’ll manage to cough up that 1%” and then went on to my rather Hegel-esque description of guerrilla wars and ideology. That’s not good enough.

I had read about insurance agencies for defense a long time ago, and so in my video response to Spawk just blurted that out as a solution. Well I went back and read Hoppe’s “The Private Production of Defense”, and it failed, man did it fail. It was triumphalist and vague and didn’t even address the free rider problem. David Freidman’s “The Machinery of Freedom” didn’t even have a solution, just a very vague suggestion involding dominant-assurance contracts. Molyneux, Molyneux doesn’t even advocate the use of force and recommends ostracism and passive defense to defend against religious war bands and invading states. My old solution of guerrilla war only works if the stateless society is filled with ideologues, which is a totally unrealistic assumption. We need a standing army.

I think I found a solution here. But I suspect a lot of people won’t like it one bit and would call my proposal a state. I will admit that my solution is right on the edge of being a state, but is not quite a state and in a way that won’t give it monopolistic power.


What is needed is a conventional military force that can repel invasions from any other state, and it must defend the entire former US. while the borders of a stateless society only exists in relation to other states, Chinese, Canadian or Mexican troops can’t be allowed to expand one bit. We’re all in this together, because if states are allowed to gobble up one area, settle in, and move on to another, they can easily, if not immediately, digest the entire former US. Resources from San Diego must be utilized in a defense against an attack on Maine. The liklihood of an attack is also very high, at least immediately.

During the French Revolution, the monarchies surrounding France pounced on her in an attempt to crush an ideology that was dangerous to them: democracy. France at the time was by far the most populous and most powerful state in europe, which means the world, a similar position the US is in today. The similarity continues in that a stateless society is a real threat to democracy in the same way democracy was a threat to monarchies. Furthermore, the collapse of the state will mean the national debt is defaulted on, and that can easily be used as a modus operandi for other states to invade. 

Another scenario would involve China denying access of “US” shipping through the Panama Canal, which would require a US invasion that could and probably would be painted as US aggression. This, coupled with the invasions of the US military around the world in the past can be used to galvanize a global grassroots opposition to the US in justifying an invasion, to kick “us” while “we’re” down so to speak.

I have no crystal ball, but states are going to try to fuck up the stateless society in some way or another, and the stateless society needs to be prepared.

Assuming the real production of the US amounts to $8 trillion in 2010, defense would go like this:

If 1% was spent on defense by some mechanism, $80 billion would be spent on defense.

2% - $160 billion

5% - $400 billion

10% - $800 billion

It is my opinion that the stateless former US can survive if $400 billion in defense can be amassed, preferably something closer to $800 billion at least at first, which would be larger than the current US military budget and the military would be geared entirely toward defense. 

Obviously the amount spent on defense wouldn’t be measured in Federal Reserve Notes, I’m just talking about a 2010 FRN equivalent.

In addition to this is the problem of coordination and where more specifically the money will go, but for now lets just address the problem of funding, just the amassing of funds for defense.


- The first source of funding is volunteer resources. The resources can be volunteer soldiers or monetary donations. This is obviously something that we cannot base our theory on as it is a variable, but in reality I expect something around $100 billion being donated to defense in a stateless society at the very least.

Around $300 billion is donated each year to charities in the US, and I assert there will be even more collective social pressure to donate to defense than charity. Of that, about $100 billion goes to “houses of worship and denominational organizations”.

You may laugh, but there is reason to believe little stickers on shops saying “we support the troops” will be incentive for individuals to donate, and the amount donated can be shown, with different colored ribbons or badges for donation thresholds. 

It is not unrealistic that more than $300 billion could be donated to defense annually, and that a stateless defense could rely on voluntary contributions alone.

Ironically the National Recovery Administration (NRA) gives precedent for voluntary organization of industry. The NRA regulated prices, work hours and wages, and members of the NRA program would display the blue eagle. By not displaying the blue eagle, firms would be considered stingy, and apparently not displaying the blue eagle had such an effect that firms tried to join the NRA while cheating the regulations.

The NRA attempted to use the state courts to enforce the regulations, and this led to the NRA being ruled unconstitutional.

This would be similar to what would happen with defense, the difference being that firms wouldn’t organize to promote destructive and short-sighted economic policies, but to provide a needed service. Furthermore, paying a certain amount to defense is much simpler - either you paid it or you didn’t - and so cheating is much more difficult.

But a theory cannot rely on this and voluntary contributions must be treated as ancillary, even though I personally believe a stateless defense can be funded entirely voluntarily.

- The second source of funding that I believed would be effective would be war insurance. That is, individuals buy insurance for war damages, and the insurance companies immediately recognize that it is more cost effective to build a large collective military with other insurance agencies and to deter war than to constantly pay for war damages (I assert this is true).

A benefit of this system is that the more dangerous an area is, the higher the insurance premiums are to live there, and this disincentivizes people from living near borders or coasts. Of course lots of people will still live near coasts for other reasons, but there will be an incentive to move valuable property inland now.

The first problem is a free rider problem. Since the defense would have to cover the entire former US, anyone can choose to not get war insurance, and while not being covered by the insurance agency in case of damages, they will benefit from the defense. This free rider problem doesn’t destroy the system, but it is a hit that just has to be sustained. There will still be people willing to pay for the damage insurance made more expensive by money spent on defense, just not as many.

In addition to this, if the insurance agencies all get together and work out a scheme of all paying for a collective defense service, which could easily be done it’s just a technical problem, then a new insurance agency can enter the market and charge people for war damage insurance but not for the military infrastructure. That is, the new insurance firm would undercut the other agencies by not paying for defense. And of course the incumendent insurance agencies couldn’t exclude the undercutter firm from the benefits of defense.

Now eventually, if the undercutter insurance agency keeps gaining market share, it would make sense for the undercutter to start paying for defense, because they are now big and their contributions to defense infrastructure can meaningfully lower the risk of attak. At this point a new firm comes along and undercuts that firm.

Another problem is that war damage must be paid in policies, which gives invading states an incentive to destroy as much insured property as possible to cause the insurance-defense agencies to no longer invest in a place. This is not to say that states will be able to pinpoint insured properties or that insured properties are specifically at risk, but that the presence of insured properties gives states an incentive to firebomb entire cities and do as much property damage as possible.

The states don’t need to bankrupt the insurance agencies, which are international and can sustain about 20% of the value of their insured policies being claimed in a day. So to bankrupt them, a state army would have to destroy much more than 20% of the value of insured properties in the former US to bankrupt the insurance agencies.

BUT, the states don’t have to bankrupt them, they just have to make it unprofitable and the insurance agencies will raise rates to the point where nobody is willing to pay and so the insurance agencies pull out.

If you believe people will choose to buy war insurance even though they know they’d be better off free riding but they just want to help in the defense, well that’s just a form of volunteer resources. It appeals to sentiment and patriotism and cannot be relied on theoretically.

For these reasons, war insurance would fail in providing collective defense.

- The third source of funding that could be of some use involves exploiting the naturally cartelistic nature of utilities.

Things such as roads, plumbing, and electricity and inherently cartelistic. Because utility providers across the entire former US want defense, they can all agree to require their customers to pay for defense somehow. This can involve fee abstraction, that is raising utility rates such that it covers defense. A better method I believe would be to require a flat or progressive defense fee, as fee abstraction would raise the cost of every watt of electricity for example and cause people to consume less.

What about utility companies that simply don’t agree to pay at all? Well the utilities are interdependent, and if the pro-defense utilities outnumber the free-rider utilities, then things such as shutting off road access can be done for a city that doesn’t pay up. So the success of this operation depends on the pro-defense utilities being able to squeeze off the free-rider utilities better than vice versa.

But even if this succeeds, this can only be done to the extent utilities are naturally cartelistic, that is “stick”. This “stick” may only be 5% for example, at which point the people leaving because of the rise in cost of living in an area offsets any gain from increased rates, and may end up only raising say $10 billion.

- The fourth source of funding involves housing covenants. Like utilities, land is inherently somewhat cartelistic and it’s difficult to move. If say 90% of all people in the former US were willing to pay for collective defense, then they could require people to show proof of payment to enter their covenant, which basically means 90% of sidestreets. Enforcement is difficult and obviously nobody would erect checkpoints at every block, but they may erect checkpoints right around the free-riding covenants demanding people pay a toll to drive any farther than three blocks from their house.

This depends on two assumptions:

1. Housing covenants being near-universal

2. An overwhelming majority supporting defense

This source is unreliable.


- The fifth source of funding is the only one that can be relied on. 

Now before I propose this, lets go over polycentric law again. Murder in a stateless society will have universal sanction against, assuming it is operationally universally opposed. Same with theft, rape, et cetera.

For more quaint laws such as prohibition of substances which have less general support, those laws will only manifest in certain areas. Like “no smoking in our house” writ large. Instead of “no smoking” on an individual property plot, it’s “no smoking” on a collective property plot.

An example of a universal law that compels positive action would be forcing fathers to pay child support. These universal laws could only be in place if they had operationally universal support. Of course you’ll never get absolutely 100% of people agreeing that murder is bad for example, and so a small portion will be forced to obey the law. We could call this the ideological and marginal law.

This is distinct from a state in that it is not a central agency with control over wilderness, it is law applied over wilderness that anyone can enforce. The law is also not decided by a central agency, it is law that emerges by people choosing their legal agencies and spurning those with laws they oppose. In this way laws universally standardize and confederalize in response to the grand nexus of interactions.

The importance of this distinction is that as a monopolist over land, a state is a law-maker, as opposed to legal agencies that are law-takers, similar to a monopoly firm that is a price-maker versus a price-taker.

Is a democratic state a law-taker? No. A democratic state stages an election, and the democratic state will then make the law in response to this contrived and unnatural election. This allows 70% to force the other 30% to not drink (assuming virtually 100% believe in the legitimacy of the democratic state, which is true in the United States today). In a stateless society, if 70% wish to force the other 30% to give them their money, they will have to pick up their weaponry, and organize themselves to get it. This involves not only being able to coordinate a mob in an effective way, but to raise the weaponry to defeat whatever defenses the 30% has. And this action has to be better than trade with the wealtheir 30%, the trade involving selling labor for goods, factoring in time preference and on and on. Furthermore they must overcome whatever sentiments against such an action they have.

In a democratic state, they can use the police and military that the wealtheir 30% has paid for and force the money from the wealtheier 30% through taxes, which the 30% believes in. The democratic state facilitates mob avarice, a stateless society short-circuits the only mechanism racial socialists and moralizing busybodies have been able to successfully extort the productive value-producers with. Democracy also serves to justify extortion sentimentally by creating an official process through which the extortion occurs.

In even closer elections you get the absurdity of presidents getting 55% being said to have a mandate. Polycentric law is not analogous to democracy at all.

The way you pay for defense is you require individuals to pay the defense-due in order to recieve legal services. This can be a flat rate, progressive rate, or mix of both. If they don’t pay the defense-due, they will not have legal services, they will be outside of the law, and so anything can be done to them without fear of legal reprisal. You don’t want to be an outlaw.

"It’s a state!" say the plebians. 

So, where is the state in this arrangement? There is no central legal agency, there’s no land monopoly. There’s just law. If you don’t pay the defense-due, then legal agencies won’t help you out.

Now, if you cannot see how this is qualitatively different from a state tax and how this is much much better than a state tax, then you are probably equating the state with law, form with content. To be against the state is not to be against law or duty, and with the defense-due a large standing army can be raised of statist-caliber that can repel any state.

Why can’t this same mechanism, of near-universally agreed up law, be used for any other program, or for funding an aggressive military? Well because the legal agencies are law-takers, not law-makers. As a sizable portion of society disapproves of the laws, new agencies will form to fill the demand to the extent new law is demanded.

Now if welfare-statism has virtually universal support in a stateless society, then you can have a forced welfare scheme in a stateless society, you can also have slavery and did have slavery in what I classified as stateless societies. 

It’s all about getting the operationally universal support, which I believe is something around 90 to 95%. At that point, thine will be done.

Don’t think I like this. I don’t. I don’t want it to be possible to have slavery, welfare statism or aggressive war in a stateless society. But it is for the same reason sanction against murder is possible. But it is also the mechanism through which an involuntarily funded standing army can come to be.

That this overcomes the free rider problem should be obvious. It works as a dominant-assurance pact, sort of. Let me explain:

Lets say you have 100 people, and these 100 people would all be better off if they paid 3% of their income for defense, but each individual would be best off if they didn’t pay for defense and everyone else paid.

And so a dominant-assurance pact says to one man is that he will pay his share provided that say 90% of the others pay their share. Because of this, many more are willing to pay, but it’s still problematic because economic-roboman will still not pay a cent. Luckily man is not economic roboman and so dominant-assurance contracts work.

So 90% of people can be for paying for defense provided everyone else does as well, but won’t do so because they don’t know if everyone else will. However, this means that 90% will support the legal agencies that require everyone else to pay the defense-due, and legal agencies which don’t require a defense-due will not be respected and anyone who subscribes to such a legal agency will be outside of the law, or perhaps will just have to pay more when they want a contract legally binding or they wish to settle a dispute. It need not be full-blown outlawing, but it could be, assuming though that collective defense has enough ideological support.


I personally believe a stateless society will be able to secure all military needs through volunteered resources. But if there ever comes a point where volunteer funds are not forthcoming, a defense-due can be imposed to overcome the free rider problem if and only if the defense-due has operationally universal support. If it does not have the necessary level of support, then a stateless society will probably fall to an invading external state.

The next section will deal with coordination of defense.