Anarcho-Capitalism

Anarcho-Capitalism is fundamentally a theory about what the law is. Defined as Austrianism applied to anarchism. Austrian economics is all about applying the science of praxeology, which is the general science of Human Action, to economics. All of economics is derived from the core axiom of human action. Anarcho-capitalists say that we can also apply praxeology in ethics and law. That's where ancaps come in; we are applying praxeology to law.

Why use the term anarchism to describe this philosophy? Anarchism is from the ancient Greek "anarchia," which means without a leader, or through the Latin "anarchia," which means without power or authority. So in the context of law, what exactly does it mean to be a leader, one with power and authority? Surely it means that you have the authority to dictate the law; you're above the rest, and you lead the rest in matters of law. Implicit in the notion of some sort of human leader with authority over the law is legal positivism—the thesis that the law is whatever those in power say that it is.

Anarchism and anarcho-capitalists are surely opposed to this thesis.^[1] It is not arbitrary decrees or whim which form the basis of law; it is the objective nature of what conflict is and what is justifiable. We should not shy away from this term; it describes the position perfectly accurately.

Now, what makes capitalism a useful modifier term on the anarchism? Proto-anarchists were those prior to Murray Rothbard. They had a vague notion of what it meant to rule others or decree law, but they did not understand this in the same scientific terms as we can now with the implementation of praxeology. This is what makes anarcho-capitalism distinct: it is the introduction of Austrianism and praxeology wrought by Rothbard. Given this, capitalism is quite descriptive indeed. Austrian economics places a great emphasis on the role of the capitalist in the structure of production. Prior to marginalism, the proto-anarchists would often see situations where a capitalist would hire employees as being exploitative. It is thanks to Austrians, particularly Böhm-Bawerk, that we know that this is not at all the case. The capitalist plays an essential role in the structure of production, and he provides a service to those he employs.

Capitalism as used in "Anarcho-Capitalism" should not be taken as a prescription of a political or economic system of "Capitalism" or any system of societal organization whatsoever. When referring to capitalism qua anarcho-capitalism, it is really talking about Austrian economics. Austrian economics is a positive, value-free science; it's not stating how things should be done but rather describing how things are. It outlines the effects when things are arranged in a certain way.

Some people might impetuously say anarcho-capitalism to mean a societal system that would adhere to the non-aggression principle for the most part. But, what that would look like in practice is a topic for economists to discuss.