Written by Morris and Linda Tannehill.


A few hundred years ago, the devastation of periodic plagues and famines was unthinkingly accepted as a normal and inescapable part of human existence—they were held to be either visitations from an indignant God or nature’s means of wiping out “excess population.” Today, in spite of the volumes of frantically hopeful talk about peace, many people accept the necessity of wars in the same unthinking manner; or at least they feel that wars will be necessary for the rest of the foreseeable future. Are wars an unavoidable part of human society? And if not, why have all the years of negotiations, the reams of theories, the solemn treaties and unions of nations, and the flood of hopes and pious prayers failed to bring peace? After all the talking, planning and effort, why is our world filled with more brutal and dangerous strife than ever?

War is a species of violence, and the most basic cause of violence is the belief that it is right or practical or necessary for human beings to initiate force against one another—that coercion is permissible or even unavoidable in human relationships. To the extent that men believe in the practicality and desirability of initiating force against other men, they will be beset by conflicts.

But war is a very special kind of violence—it is “open, armed conflict between countries or factions within the same country” (Webster), which means an organized use of force on the largest scale possible and devastation of a breadth and thoroughness which cannot be matched by any other man-made catastrophe. Such carefully organized, massive, and deliberately destructive conflict cannot be accounted for simply by men’s belief in the permissibility of initiating force against other men. There must be some further factor in human beliefs and institutions which causes millions of people to put such effort into the destruction and subjugation of other millions.

In searching for the cause of war, men have put the blame on everything from a supposed natural human depravity to the “dialectical necessities of history.” The most popular current scapegoat is Big Business. We hear of war profiteers, economic imperialism, and the military-industrial complex, and we are told that businessmen need wars of conquest to gain markets.

It is perfectly true that there is a fascistic alliance between government and many businesses in our present society and that this league results in the military-industrial-university complex which firmly supports the government and its imperialistic policies. The question is, what is the cause of this unholy alliance? Is it a perversion of normally peaceful and non-aggressive government by greedy businessmen, or is it a perversion of business by government?

The military-industrial complex came about as a result of government’s power to use stick-and-carrot methods to rule business (which was just one part of the politicians’ efforts to rule everyone). For a stick, the politicians use anti-trust laws, interstate commerce laws, pure food and drug laws, licensing laws, and a whole host of other prohibitions and regulatory legislation. Many years ago, the government succeeded in making regulatory legislation so complex, contradictory, vague, and all-encompassing that the bureaucrats could fine and imprison any businessman and destroy his business, regardless of what he did or how hard he tried to obey the law. This legal chicanery gives the bureaucrats life-and-death control over the whole business community, a control which they can and do exercise on any whim, and against which their victims have very little defense.

For a carrot, the politicians hold out large and lucrative governmental contracts. By crippling the economy with regulations and bleeding it by taxation, the government has drastically cut the number of large and profitable contracts available from the private sector, which forces many businessmen to get such contracts from the government or do without them. To stay in business, businessmen must make profits, and many of them have simply accepted government contracts, either without bothering to delve into the ethical questions or with the comforting thought that they were being patriotic. Government’s stick-and-carrot control of business has been going on for so long that most businessmen accept it as normal and necessary (just as most people accept taxes as normal and necessary).

During the last hundred years or so, many businessmen have shortsightedly aided the growth of such fascism. Big industrialists who saw government intervention as a quick and easy way to eliminate threatening competition and gain unearned advantages, were often in the forefront of the forces demanding regulation and control of the market. Government, after all, is an instrument of force. It can be used by anyone who can gain temporary control of it to extort advantages from his fellowmen. Businessmen have made use of this instrument of force—so have labor leaders, social planners, racists, pious religionists, and many other societal forces. As long as such an organized institution of force exists, individuals and pressure groups will use it—if not to gain an unfair advantage, then to protect themselves from other advantage-seekers.

The present fascistic alliance between government and business, which definitely is aggressive and imperialistic, is a forced alliance—forced by government and by those who use government’s power to extort advantages from legally disarmed victims. But if they were separated, which partner in this would be the aggressively malicious and imperialistic one? Is business or government the basic cause of aggressions?

Business, when separated from government, is not only non-imperialistic—it is strongly and uncompromisingly anti-coercive. Men who trade have nothing to gain and everything to lose from destruction. Wars of conquest do not gain markets for business. The most significant effect of war on markets is to damage and destroy them by killing and impoverishing multitudes of people and disrupting the economic life of entire areas. Private enterprise wins markets by the excellence of its products in competitive trading; it has nothing to gain from imperialism.


Nor does business as a whole gain from war profiteering. Wars are expensive, and the burden of supporting wars falls heavily on business, both directly and by taking spending money out of the pocket of the consumer. The vast amount of money poured out to support a war is permanently gone without bringing any economic return. After you have exploded a hundred thousand dollars worth of bombs, you have nothing to show for it except a hundred thousand dollars worth of bomb craters and rubble. Thus the gains made by munitions makers and government suppliers are more than swallowed up by the losses suffered by business as a whole. Those few who do make huge fortunes from war do so not because they are businessmen operating in a free market, but because they have political pull. And their profiteering from war harms all producers (as well as the consuming public) by hurting the economy as a whole.

Business is a natural opponent of war because businessmen are traders, and you can’t trade amid falling bombs. An industrialist can gain nothing from the ruins and poverty which are the chief results of war. Furthermore, businessmen are a society’s producers, and it is always the producers who must foot the bills.

It is not business which gains from war, but government. Successful wars leave governments with more power (over both their own citizens and those of the conquered nations), more money (in the form of plunder, tribute, and taxes), and more territory. The more totalitarian a government, the more booty it attempts to squeeze from its wars, but all governments, even relatively limited ones, gain large amounts of power and plunder from successful warfare. Besides this, war is often ideologically useful to unite the populace behind the government in the face of a “common enemy.” People can be made to sacrifice more, with less resistance, if they believe they are in danger of being overrun by the terrible Russians (or the Red Chinese, or Krauts, or Japs, or “common enemies” ad infinauseum!).

Wars are initiated and carried on by governments. Governments, not private individuals, provoke massive conflicts by arms buildups and imperialistic territorial grabs. It is rulers, not businessmen and citizens, who declare wars, draft soldiers, and levy taxes to support them. There is no societal organization capable of waging a war of aggression except government. If there were no governments, there would still be individual aggressors and possibly even small gangs, but there could be no war.

It is not surprising that governments are the source of war when one considers the nature of government. A government is a coercive monopoly—an organization which must initiate force against its own citizens in order to exist at all. An institution built on organized force will necessarily commit aggressions and provoke conflicts. All wars are, in the final analysis, political wars. The are fought over the question of who is to rule.

So, to abolish war, it is not necessary to attempt the impossible task of changing man’s nature so that he can’t choose to initiate force against others—it is merely necessary to abolish governments. This doesn’t mean that the establishment of one or even several laissez-faire areas will immediately end warfare, because as long as there is one viable and potent government left, the threat of war will remain and the free areas will need to keep up their guard. But if a laissez-faire society were to become a reality throughout the civilized world, war would cease to exist. Is there any practical hope of such a government-free, war-free situation coming into existence throughout the world after the establishment of one free area? To answer this question, it will be necessary to examine the effects which a laissez-faire society would have on the rest of the world.

A laissez-faire society could not have “foreign relations” with the nations of the world in the same sense that a government does, because each inhabitant would be a sovereign individual speaking only for himself and not for a collective aggregate of his fellows. Yet in spite of this, a laissez-faire society would have a profound and inescapable effect on the rest of the world as a result of its mere existence.

A laissez-faire society would, by virtue of its freedom, be superior to any governmental society in three key economic areas—scientific research, industrial development, and its monetary system. It is obvious that the more men are free to pursue any non-coercive interest, to realize the rewards of their research, and to fully own any property thus earned, the more intelligent effort they will put into research and the more discoveries will be made. And since the market rewards only productive research, a free society avoids the tremendous waste of effort and resources inherent in government-sponsored research programs. Similarly, freedom provides the greatest incentive to industrial development, as any governmental interference at all constitutes a distortion of the market. As to the monetary system, government currencies are seldom out of trouble for long, and the more closely they are controlled, the deeper and more perplexing become their problems. It is no exaggeration to say that, in a modern industrial society, a banking firm operating on the free market and issuing money in competition with other such firms would not dare to experiment with the sort of absurd and disastrous fiscal policies in which governments continually engage. Any free-market firm which issued a currency as undependable as that issued by most governments would speedily be run out of business by its more financially sound competitors.

In short, free men can and will build a stronger economy than men who are taxed, harassed, regulated, legislated, bound—that is, held in some degree of slavery by governments. This principle can be seen in operation even today in the contrast in economic strengths between the totalitarian, governmentally controlled Communist bloc nations and the less enslaved nations of the West. Soviet propaganda and the adulations of statist-minded Westerners to the contrary notwithstanding, the Soviet economy is continually beset with gross mismanagement, critical shortages, poor quality products, agricultural crises, severe unemployment, and general confusion. Russia’s “rapid economic growth” is nothing but a myth. In fact, it is extremely doubtful that the Communist tyranny could have survived at all without substantial aid from governments of the West, especially the U.S.A.

The American economy, although crippled by government interferences and bilked of billions of dollars for “foreign aid,” still manages to far surpass the stumbling economy of the Soviet Union, even though the Soviets have obtained from conquered European countries and American Governmental aid entire factories, hordes of technicians, streams of strategic goods, and shiploads of foodstuffs. A comparison of the American and Soviet economies gives a hint of the vast superiority which a laissez-faire economy would enjoy over any unfree economy. And military strength is necessarily based on economic strength.

Because of its economic strength, a laissez-faire society would exercise a profound effect on the nations of the world even though it would have no government to formulate and carry out a foreign policy. First, the existence of a free area would cause the rest of the world to experience a brain drain of such tremendous proportions as to make the brain drain which currently worries the British look laughable by comparison. As the economy of the laissez-faire society expanded almost explosively in response to freedom, it would produce a great demand for men of intelligence and ability, and it would be able to offer such men more—in terms of money, ideal working conditions, opportunity to associate with other men of ability, and (most important) freedom—than would any govern-mentally controlled society. Producers in every nation would want to move to the laissez-faire society. Many might decide to move not only themselves but their entire businesses to the free area. They would see that, by escaping taxation and regulation, they could make greater profits even if they had to pay additional shipping costs and higher wages. Such an influx of business would cause a high demand for competent labor in the free area, which would raise wages. It would also tend to make the nations which lost producers and businesses economically dependent on the laissez-faire society for necessary goods and services and, therefore, reluctant to attack it.

Governments wouldn’t be able to offer the men of ability in their countries enough to keep them from flocking by the thousands to the exciting opportunities in the laissez-faire society. If they wanted to hold such men, the governments would have to hold them by force, as the iron curtain countries do now, and the experience of these iron curtain countries has shown that men of ability do not function well under constraint. A brain drain of this magnitude would constitute a crippling hemophilia for the nations of the world, and the only response the governments could make to it would be to institute restrictive measures—a move toward tyranny which would also be crippling—or to disband (which is unlikely, considering the nature of politics).

But a brain drain is not the only hemophilia which the governments of the world would experience as their citizens became aware of the opportunities in the free area—there would also be a capital drain. Investors always try to place their capital in areas of maximum profit and minimum risk (that is, minimum future uncertainty), and one of the greatest sources of future uncertainty is the power of bureaucrats to issue directives and regulations on any whim. This means that businesses in a laissez-faire society would be tops on the list of attractive investments for investors all over the world. Like the brain drain, the capital drain would strengthen the free area at the expense of the nations; and again, the only response their governments could make would be further restrictive legislation—which would further weaken their economies—or to disband.

The existence of a laissez-faire society would also have a profound effect on governmental monetary systems. Governments commonly sap the strength of their currencies by engaging in inflationary practices. (They do this because inflation is a sort of sneaky tax which allows the government to spend more money than it takes in, by putting extra currency into the economy, thus stealing a little of the real or supposed value of every unit of currency already there.) As tax burdens become more oppressive, few governments can resist the temptation to circumvent citizen protest by resorting to inflation. They then protect their shaky currencies from devaluation, as long as possible, by international agreements which fix the relative value of currencies and obligate nations to come to each other’s aid in financial crises. In a sense, the main protection which an inflated currency has is the fact that all the other major currencies of the world are inflated, too. But the currencies of a laissez-faire society, being subject to the rules of the market, could not be inflated (inflated currencies would be driven off a free market by sound ones). Holders of capital naturally want to hold it in the form of the most sound money available, so they would move to sell government currencies and buy free-market money. This move itself would further weaken unsound governmental economies, as it would cause a de facto devaluation of their currencies. It might well precipitate a series of near-fatal financial crises among the nations. Thus, a government would have to choose between maintaining a sound currency (necessitating a strict limitation of government functions) or attempting to hedge its currency about with a wall of restrictive legislation which would paralyze its economy and, at best, would do little more than postpone its collapse.


These examples show how a sizable laissez-faire society, simply by existing, would amplify stresses within the nations and compel them to move rapidly toward either complete freedom or tyranny. The laissez-faire society wouldn’t create these stresses; its presence would merely aggravate tensions created long ago by the irrational and coercive policies of governments. These stresses would destroy the precarious equilibrium of all the nations at the same time.

In every nation, there is some degree of conflict between citizens and government. In nations with relatively limited governments, this conflict may be only minor; but in totalitarian countries it can amount to a latent civil war between the ruled and the rulers. To the extent people realize that freedom is practical but that it is being denied to them, this conflict is intensified. It is also intensified by the government’s addition of new restrictive measures, especially if the measures are passed suddenly without much prior propaganda to prepare the citizenry. The existence of a successful laissez-faire society would both demonstrate the practicality of freedom and force governments to take sudden new restrictive measures, thus further amplifying their internal stresses by setting the people consciously against their governments.

By demonstrating that government is not only unnecessary but positively detrimental, a successful laissez-faire society would strip all governments of their mystical sanctity in the eyes of their citizens. The reason the institution of government has persisted into modern times is that people submit to its depredations, and they submit because they believe that without a government there would be chaos. This nearly universal belief in the necessity of government is tyranny’s strongest defense. Once the idea of the nature of full liberty has been let loose in the world and its practicality demonstrated, governments will lose the respect of their citizens and will be able to evoke no more allegiance from them than they could obtain by force. It is ideas, after all, which determine how human beings will shape their lives and societies.

But government officials don’t give up their power and patronage easily, even when there is a great popular demand for a reduction in government. In some countries, the idea of freedom might be strong enough and government weak enough for popular opinion to force a series of cutbacks in government size and power until the government was a figurehead and finally non-existent. It is probable, however, that the majority of governments would fight back by becoming more restrictive and tyrannical; and this is particularly true of countries well along on the road of government control. So most of the non-free world would degenerate into various combinations and degrees of tyranny, revolt, and social chaos.

Popular misconception to the contrary notwithstanding, the degree of a government’s tyranny is the degree of its vulnerability, particularly in the sphere of economics. Totalitarian governments, in spite of their outward appearance of unconquerably massive solidarity, are inwardly rotten with ineptitude, waste, corruption, fear, and unbelievable mismanagement. This is, and must be, so … because of the very nature of government control.

Government control is control by force, since coercion is the source of government power (the source of market power is excellence of product and performance). The more totalitarian a country, the more its citizens must be motivated, not by the incentive of expected rewards (the proft motive), but by fear. Without freedom to enjoy the rewards of his productivity, a man has no incentive to produce except his fear of a government gun. But a threat will evoke only that minimum performance necessary to avoid the threatened harm, and that only insofar as the threatener is constantly watching.

Even more crippling is the fact that threats don’t produce innovative ideas. A man’s mind can only belong to him; he is the one person who can order that mind to produce ideas. Fear is paralyzing; if a threat is strong enough to motivate a man to try to produce an innovative idea, it will usually generate too much fear for him to think dearly. This is why dictatorships find it necessary to permit their scientists and other intellectuals a special privileged status with extra liberties and incentives. They must do this, even though it is extremely dangerous to a tyranny to harbor intellectuals who are free to think and express even mild condemnation of their rulers. Any dictatorship must walk a constant tightrope between giving its intellectuals too much freedom so that they become rebellious, and giving them too little so that they stop producing ideas. And what is true of intellectuals is true to a lesser degree of all the millions of ordinary, hard-working individuals whose little ideas of “how to do it better” contribute so much to economic advancement.

In addition to the initiative-smothering effects of replacing freedom with fear, the inevitable governmental rules and regulations enmesh and strangle the economy. When free from interference, the market is always in motion toward equilibrium—that is, toward a condition which eliminates shortages and surpluses and minimizes economic waste. To the degree the market is interfered with by governmental controls, it can no longer respond to economic reality and becomes distorted. Then shortages, surpluses, delays, waste, queues, ration books, high prices, and shoddy merchandise become the order of the day.

Nor is central planning the answer to such problems. The assumption that someone, or even a group of someones, could regulate an economy is absurdly naive. The biggest computer ever built couldn’t begin to handle the volume of data which is automatically dealt with by individual choices made in the market every day. Furthermore, this data is based on millions of individual value-choices all made from separate, individual frames of reference, so the items cannot possibly be measured and compared as required by a computer. “Central planning” only distorts the market by forcing it into configurations it would not normally assume and preventing it from being self-correcting. There is no way for a planned economy to work. The more completely it is planned, the more distorted and inflexible it will be, and the weaker will be the nation.

Tyranny is, by its very nature, counterproductive and full of internal stresses. The Soviet Union, for example, has derived its strength almost entirely from the massive amounts of aid furnished it by the relatively less enslaved countries of the West, particularlv the United States of America. Without this aid provided by taxes confiscated from producers in less tyrannical nations, the Soviet dictatorship would have collapsed long ago.4

Tyranny by itself is impotent because looters don’t produce and producers can’t produce unless they’re free to do so. The belief that totalitarian nations are naturally stronger than freer ones is an outgrowth of the moral/practical dichotomy. If that which is moral were, because of its morality, unavoidably impractical, then the good would necessarily be helpless and disarmed, since the evil would have all the practicality on its side.

Those who persist, in spite of all evidence to the contrary, in believing that totalitarianism makes a nation strong are revealing a sneaky admiration for dictatorship. Such an admiration springs from a psychological dependency which cannot conceive of having to be free and thrown on one’s own uncertain resources. The phychologically dependent man longs either to be led and directed in order to escape the responsibility of decision-making, or to dictate to others in order to convince himself of an efficacy he doesn’t possess.

Because tyranny is necessarily weak and vulnerable, the stresses created within the governmentally controlled nations by the existence of a laissez-faire society would force them to move toward either complete liberty or toward impotence and chaos. At the same time, the dazzling idea that real freedom is both possible and practical would create a surging groundswell of popular demand for this freedom in nations throughout the world. Governments would lose support as their citizens lost their irrational patriotism. Thus, the laissez-faire society, by its mere existence, would weaken its enemies and promote the rise of freedom outside its boundaries, causing the dismantling of governments and the rise of new free areas.

But the laissez-faire society would spread liberty throughout the rest of the world, not only in a passive way via the conditions caused by its existence, but actively—by trade relationships. Free individuals trading with natives of foreign, countries would be under no obligation to recognize the validity of their governments, any more than they would be to recognize the validity of other kinds of hoodlum gangs. Because they would see governments for what they really were, they would be psychologically free to defend themselves against these governments. They would obey the trade restrictions of foreign states only insofar as it was in their interest to do so and would ignore and disobey them whenever it proved advantageous. They would have no compunctions about seeing governments topple, since an end of governments always means an increase in liberty and prosperity.

When free individuals entered into business in territories still under the control of governments, they would want their foreign holdings protected, just as were the rest of their properties. Insurance and defense companies, ever on the lookout for new sales opportunities, would offer this protection (at rates and with stipulations commensurate with the amount of danger involved in each separate nation, of course). Protection and defense services could apply simply to the depredations of private criminals. Or, if the government were not particularly strong, they could also safeguard the protected company from the threat of nationalization, and even from taxation and regulation.

Picture a small South American dictatorship, weakened by economic stresses and a popular demand for more freedom, resulting from the existence of a laissez-faire society nearby. What would the dictator of such a country do if faced by a large and powerful insurance company and its defense service (or even a coalition of such companies) demanding that he remove all taxes, trade restrictions, and other economic aggressions from, say, a mining firm protected by the insurance company? If the dictator refuses the demand, he faces an armed confrontation which will surely oust him from his comfortable position of rule. His own people are restless and ready to revolt at any excuse. Other nations have their hands full with similar problems and are not eager to invite more trouble by supporting his little dictatorship. Besides this, the insurance company, which doesn’t recognize the validity of governments, has declared that in the event of aggression against its insured it will demand reparations payments, not from the country as a whole, but from every individual directly responsible for directing and carrying out the aggression. The dictator hesitates to take such an awful chance, and he knows that his officers and soldiers will be very reluctant to carry out his order. Even worse, he can’t arouse the populace against the insurance company by urging them to defend themselves—the insurance company poses no threat to them.

A dictator in such a precarious position would be strongly tempted to give in to the insurance company’s demands in order to salvage what he could (as the managers of the insurance company were sure he would before they undertook the contract with the mining firm). But even giving in will not save the dictator’s government for long As soon as the insurance company can enforce noninterference with the mining company, it has created an enclave of free territory within the dictatorship. When it becomes evident that the insurance company can make good its offer of protection from the government, numerous businesses and individuals, both those from the laissez-faire society and citizens of the dictatorship, will rush to buy similar protection (a lucrative spurt of sales foreseen by the insurance company when it took its original action). At this point, it is only a matter of time until the government crumbles from lack of money and support, and the whole country becomes a free area.

In this manner, the original laissez-faire society, as soon as its insurance companies and defense agencies became strong enough, would generate new laissez-faire societies in locations all over the world. These new free areas, as free trade made them economically stronger, would give liberty a tremendously broadened base from which to operate and would help prevent the possibility that freedom could be wiped out by a successful sneak attack against the original laissez-faire society. As the world-wide, interconnected free market thus formed became stronger and the governments of the world became more tyrannical and chaotic, it would be possible for insurance companies and defense agencies to create free enclaves within more and more nations, a sales opportunity which they would be quick to take advantage of.

It is obvious that, while a laissez-faire society might be vulnerable in its infancy, it would rapidly gain strength as it matured. At the same time, the nations of the world would become weaker and more chaotic, opening the way for the establishment of free enclaves which would destroy governments and form a world-wide free market. In the final maturity of this free market, there would be no more governments left, and so … no more wars. The only way this condition of world-wide peace and freedom could be lost is if a large number of people reverted to the “give us a leader” superstition and demanded a return of governments all over the world. There are strong safeguards against this disaster, however. Not only would it be hard to get such a movement going all over an enlightened world, but capable individuals tend not to want a leader, and incapable ones tend to be uninfluential in the just environment of a laissez-faire society.

The length of a laissez-faire society’s possibly vulnerable infancy and the possibility and severity of any wars during this period depend on variable factors beyond our present foresight. For instance, the size and location of the original free area would have a great deal of influence on its strength and its consequent safety and rate of spread. A large, well industrialized country with adequate natural resources is obviously preferable, while a small island would run the risk of being overrun before is got well started.

Another important variable is the amount of economic deterioration present in the world as a whole at the time the laissez-faire society is established. Governmental fiscal policies are leading the world down on one-way street to economic disaster. It would be ideal to have the governments as economically weak as possible, but at the same time if the laissez-faire society arises in a time and place of financial ruin, much valuable energy will have to be expended just to bring fiscal order and sanity out of the resulting social disorder.

Probably the most important variables are involved in the extent to which the idea of the nature and practicality of liberty is spread. If an overwhelming majority of the people in the free area are firmly convinced of the personal benefits of liberty, they will obviously be a force to’ be reckoned with. In addition, the spread of the idea throughout the major nations would go far toward undermining their strength. It is useful to remember that ideas know no boundaries.

Since the governments of the world are largely controlled by men who have a profound disrespect for the importance and efficacy of ideas, it is somewhat questionable whether they would be able to recognize the threat which the idea of liberty poses to them in time to avert it. To men who live on the basis of range-of-the-moment pragmatism, ideas can be almost invisible. Furthermore, the leaders of the world are paralyzed by their cynical allegiance to the worn-out and bloodstained philosophy of statism, which has long ago proved its inability to effect any human happiness. They have no idealistic fervor to spur them on and excite their followers, but only a tired and frightened clinging to a familiar status quo. The wave of progress has already passed them by.

Since life offers no automatic guarantees of safety and success, there is no guarantee that a laissez-faire society would survive and prosper. But freedom is stronger than slavery, and a good idea, once spread, is impossible to stamp out. The idea of liberty is the innoculation which can kill parasitical governments and prevent the disease of war.