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Areas that need development from libertarian thinkers

I tweeted: “One area that has not received much attention by libertarian theorists, that I know of, is bankruptcy. Still work to do!”

Someone asked me: “Do you have more topics without much attention from libertarian thinkers?”

My reply:

Yeah and I need to collect them.

But here are a few, off the top of my head.

  • Bankruptcy is one area, as noted above. Conza has some thoughts here. See more below.
  • a careful delineation of the difference between the juristic and economic realms of phenomenon. I am starting to do this haltingly. Bohm-Bawerk touched on this in ch. II of Shorter Classics: “WHETHER LEGAL RIGHTS AND RELATIONSHIPS ARE ECONOMIC GOODS”
  • Yet another would be a close evaluation of the body of modern private law from the common law, and Roman/continental tradition—namely, the US/English common law, and the modern civil codes (e.g., the Louisiana Civil Code), to identify which parts are libertarian and which are clearly not. This would be sort of futile and a waste of time, but it might be of interest to some. It would require lots of effort, but only by someone who knows serious Austro-libertarian theory and law and legal theory—that is, a very good lawyer (and preferably one who knows both common law and continental/European law, plus international law), who is also knowledgeable in legal theory/jurisprudence, and Austro-libertarian theory. In short, someone like me—and there are only so many of us in the world who would be competent.
  • Yet another would be to draft a systematic, but concise, codification of libertarian principles. I am sort of working on that.
  • Ownership of mechanical hardware that wakes up and develops sentience, i.e., artificial intelligence; I think the right approach is close to how infants acquire self-ownership, as outlined in How We Come To Own Ourselves.
  • Another would be: a careful theoretical treatment of how to best unify the law/legal theory: in the past some have said criminal law would go away and all would collapse into contract or private or tort law. I tend to think it might be the opposite: everything collapses into criminal law, since all property rights, in the end, are enforceable, or redressable, with force, and that requires criminal law concepts and principles. But this would be another serious undertaking.
  • Strict liability versus other standards. I have been leery of libertarians’ assumptions about strict liability since it sometimes implies someone is automatically responsible if property they own is used to or somehow harms others. I am leery of this since property rights are rights to use (technically: the right to exclude others), not responsibilities.
  • The nature of fraud and why it’s a rights violation. I have done some work on this, but only a beginning… See Fraud, Restitution, and Retaliation: The Libertarian Approach and The Problem with “Fraud”: Fraud, Threat, and Contract Breach as Types of Aggression.
  • others tbd…


I believe I touched on this topic lightly in a few pieces, wondering whether taking a debtor’s property from him to satisfy a debt would be enforceable/justifiable if that meant the debtor’s actual death (for example if a person contractually assigns to someone else all his future property, even food that is given him). I can’t find now where I touched on this—I believe I mused that perhaps the arguments for inalienability in the body might cover transfers of property that would result in death or harm to the body; as I mention in my  A Libertarian Theory of Punishment and Rights:

For example, imagine that A, a thief, admits that there are rights to self-ownership but that there is no right to property. If this is true, we can easily punish him simply by depriving him of external property, namely food, air, or space in which to exist or move. Clearly, the denial of his property through the use of force can physically harm his body just as direct invasion of the borders of his body can. The physical, bodily damage can be done fairly directly, for example, by snatching every piece of food out of his hands until he dies—why not, if there are no property rights? Or it can be done somewhat more indirectly by infringing upon his ability to control and use the external world, which is essential to his survival. Such property deprivation could continue until his body is severely damaged—implying, since this is tantamount to physical retaliation in its effect on him, that physical retaliation in response to a property crime is permissible—or until he objected to such treatment, thereby granting the existence of property rights. Just as one can commit an act of aggression against another with one’s body—for example, one’s fist—or with external property—a club, gun, bomb, poison—so one’s self- ownership rights can be aggressed against in a limitless variety of ways by affecting one’s property and external environment.

But I believe somewhere in my writing I suggested that one could argue that taking all the food from someone would be tantamount to killing them, thus justifying some type of bankruptcy right, in inalienability grounds, but I cannot find it.

I do find in my notes a letter I wrote after law school to my former bankruptcy law professor, James Bowers (R.I.P.). Here is the text, for what it’s worth. Note that this is from 1993, before I had started to write in more detail on contract theory, inalienability, and so on, and anticipates many arguments I would later make (2003) in  A Libertarian Theory of Contract: Title Transfer, Binding Promises, and Inalienability.

Stephan Kinsella, Letter to Professor James Bowers, August 9, 1993

My own views on bankruptcy laws are as follows. The typical libertarian view on this (as far as there is one—I haven’t actually seen much writing on it other than by Murray Rothbard in his masterful The Ethics of Liberty, ch. 19) is that, if A loans money to B, and B promises to repay $X to A on a certain date in the future, then if B does not or cannot repay A on that date (e.g. because he is bankrupt), then it is effectively the theft of A’s money. So then A would sue B for the money, and recoup it in various forms, unless B is totally bankrupt and has no assets, so then A would have to garnish B’s employers etc. But B would never be absolved from a debt just because he was unable to pay it. Of course, knowing ahead of time that sometimes debtors are simply unable, through no fault of their own, to repay debts when due-date comes, A and B might put a clause in their contract stating for a certain private type of absolution of the debt, or renegotiation, or whatever. Or maybe they will use mortgages/security devices, etc., as you are of course aware.

Now I agree with this, but not 100%. My concept of rights is explained in my Estoppel article. But the point is that A does not have the right to use force against B unless force has first been used by B. Therefore, by this theory, there is no such thing as a “contract,” typically understood, that can legitimately be enforced. This is because a mere promise is a mere expression of words by B; and this is not the use of force against A; therefore this cannot justify A’s use of force against B. B does not initiate violence against A by merely saying something to A, such as, “A, I promise to pay you $1000 in a year in exchange for $900 now.” And arguments about A’s reliance are flawed, I believe, because why should A “rely” on these words, unless he knew promises were already enforceable? So reliance can’t justify enforceability, because there would be no justified reliance if it weren’t enforceable. That would be a circular bootstrap argument.

I believe there are only property rights—the right to control your own body and to not have its physical integrity breached; and the right to own property that is either homesteaded or voluntarily acquired from a prior (legitimate) owner. And I also believe you have the right to dispose of your (alienable) property, even in the future. So you could, by this ability, make up conditional bequests of future property and you could effectively privately create something almost identical to what we call “enforceable contracts” today. Except that there are, under my theory, no dilemmas about things like, say, why you can or cannot sell yourself into slavery. (All this will be worked into my book I am working on, Estoppel: A Theory of Rights, which will elaborate on my earlier Estoppel article.) The reason you cannot sell yourself into slavery is simply because you do not have the metaphysical ability to currently shackle your future volition. I.e., to sell oneself into slavery, say, in a year’s time, or even right now, the slave S would be owned by O. If S tries to escape, what right does O have to use force against S? Has S used force against O? No, he has not; he has only said something to O (namely: “I will be your slave in a year.”). S clearly does not consent to being imprisoned at the moment O attempts to imprison him; and S has not initiated violence against O which would justify O’s use of force against S. For this reason our own property in our bodies is inalienable. If a person somehow had the ability in the present to force his mind in the future to consent to any orders his master would give him, slavery might be possible; but it simply is not possible to prevent yourself in the future from objecting to violence against you. This is similar to legislative supremacy or sovereignty, the idea that the government or legislature of a sovereign cannot bind itself in the future. Even if it passes law x, it can pass another one later. Even if it passes a law saying that no legislature may repeal law x; still, this cannot stop a future legislature from simply voting to repeal it. This is how I view inalienability.

But we can also own property; and this means to be able to voluntarily dispose of it or give it or sell it to someone else. I also believe this right extends to future-acquired property. I.e., I believe that, if A can, by some act, some physically tangible act that others can see (e.g. a written contract) manifest his will to transfer ownership of his house to B; then A can also declare in the act of sale that the time of transfer is, say, one year in the future. Then, one year from that day, B becomes the owner of the house. It is too late for A to change his mind; he no longer owns the house. It is too late for A to change his mind even a month before the planned day of transfer of ownership; for he has already given away the house (just not effective until another month). So after the day B becomes the owner, if A refuses to give it up, he is stealing or trespassing against B’s property. So property that we own, other than our bodies, is alienable.

Anyway, my point is this. For bankruptcy laws, given this framework of rights, people must be clear in their “contracts” what they mean and how they intend to dispose of property. If A says he will repay B $1000 in a year; but then A is bankrupt in a year, then there is simply no property to transfer; it turns out they were talking about something that didn’t exist. Now they can specify in their original contract (which is just a declaration of future conditional transfers of ownership of various property of A) that, if A doesn’t have $1000 on day 365, then any extra money A earns by, say, employment, thereafter, up to $1000, becomes B’s property. Etc. Or they could work out other arrangements. So like you I don’t think there should be a specific bankruptcy law, other than standard security devices and contract law (except consistent with my understanding of the proper justification for the enforceability of contracts). The law should allow and enforce private, voluntary dispositions of property. I agree that this will be “efficient,” in some sense, just as all values are satisfied and pursued more “efficiently” the freer that people are to pursue them.

{ 1 comment… add one }
  • Alex W. January 28, 2022, 11:27 am

    Has there ever been a libertarian analysis of civil commitment (or, generally, the problem of persons who are an active danger to themselves)? I’m guessing this analysis exists and I’m just ignorant of it, but I’m new to libertarian theory and curious how this problem is addressed.

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