Leithner Letter No. 77
26 May 2006

Sending Australian troops to occupy the Solomon Islands would be folly in the extreme. It would be widely resented in the Pacific region. It would be very difficult to justify to Australian taxpayers. And for how many years would such an occupation have to continue? And what would be the exit strategy? The real show-stopper, however, is that it would not work, no matter how it was dressed up, whether as an Australian or a Commonwealth or a Pacific Islands Forum initiative. The fundamental problem is that foreigners do not have answers for the deep-seated problems afflicting the Solomon Islands.

Alexander Downer
The Australian (3 January 2003)

I want on behalf of the Australian Government and the Australian people to thank you for your professional commitment that will take you to the Solomon Islands, [and] to say that you have the very strong support and the total good wishes of the Australian community for what you are doing. We are responding to a very heartfelt request from a small country in our region that needs our help so that it doesn’t become a failed state and fall further into disorder and disorganisation, posing in time not only a threat to the safety and wellbeing of its own citizens, but potentially the whole region, which is so important to Australia.

John Howard
Address for Troops and Police Heading to the Solomon Islands
(23 July 2003)

The civil unrest in the Solomon Islands appears to be worsening, with rioters now setting fire to buildings in the centre of the capital, Honiara. ... Over 1,000 looters flooded into Chinatown yesterday afternoon. By early this morning only a handful of shops remained unscathed, with over half the shops there burnt to the ground.

The Solomon Star (19 April 2006)

Last night, an additional 180 Australian police and soldiers landed in Honiara to help the 282 already in place. ... This is a serious development for Australia, and points to a commitment [of at least $1billion in addition to] the $840 million already allocated to cover Solomon Islands operations in 2005-2009. Foreign Minister Alexander Downer reflected the sombre mood in Canberra yesterday when he expressed pessimism about Australia being able to get out of the Solomons. ...

“Trouble in Paradise”
The Australian (20 April 2006)

Humanitarian Government Interventionism = Inhumane Meddling

Spare a sympathetic thought for the people of the Solomon Islands. Their parents and grandparents, particularly on the island of Guadalcanal, witnessed – and by no means all survived – some of the bitterest fighting of the Second World War. After the war, and particularly after the Islands’ sovereignty from Britain was proclaimed in 1978, the disasters continued. Perhaps most lamentably, the Solomons (and other Melanesian states like Papua New Guinea and Vanuatu) received substantial “aid” from Australia and other countries. Has this intervention lifted local living standards? According to The Weekend Australian (22-23 April) “[its] economy shrunk by a full quarter between 1998 and 2002. Indeed, the Solomons have gone very far backwards. The International Monetary Fund estimates that [the country] would need 40 years of better than 4% annual economic growth merely to reach the living standards of the mid-90s.”

The most recent misfortune, the Regional Assistance Mission to the Solomon Islands (RAMSI), a combined police-military operation staffed mostly by Australians, some New Zealanders and a few Pacific Island representatives, has since July 2003 attempted to restore law and order, tackle corruption, create a stable government and thereby encourage “transparency” and “good governance.” Like all government programs, and prompted by the tumult following the elections of April 2006, RAMSI’s ambitions have been sharply lowered but its staff and budget drastically expanded. Its purpose now is to prevent the country’s disintegration into a “failed state” and haven for terrorists.

According to Mr Howard (Brisbane Radio 4BC 19 April), Australians “must be prepared for a decades-long leadership role in supporting potentially failing states.” Echoing Rudyard Kipling, the PM stated that “Australia is by far and away the biggest, wealthiest and the strongest country in the region and we have to be prepared to shoulder the major part of the burden [of state-propping].” He added that Canberra’s “security presence” in the South Pacific, in addition “to the big civil investment in improving regional governance and building institutions,” will expand quickly and greatly and remain in place indefinitely. “We will face ... perhaps over the next 15 or 20 years, the potential for small states in the region to face the possibility of becoming failed states. It is in our interests to stop that happening ... failed states create vacuums; [and] vacuums are filled by people with bad thoughts and not necessarily good intentions.”

The Foreign Minister concurs. He claims to know nothing about certain of AWB Ltd’s activities in the recent past. But no matter: he seems to possess a clear crystal ball into the Solomons’ future. “It’s going to be a long time before we really significantly reduce the police presence.” Not to be outdone, the Acting Defence Minister (The Daily Telegraph 21 April) vowed that Australian troops would remain in the Solomons “as long as it takes to build a vibrant and stable state.” The Opposition, too, is staunchly interventionist. Indeed, it matches and increases the Government’s ante. Its Leader believes that “[Australian soldiers] need to be going in larger numbers than they are now. Committing ourselves in this area is where we ought to be. This is our back yard. Here and forever is where our responsibilities lie.” And the Shadow Treasurer agrees that more resources, both for policing and “social aid,” are required. “We [the Australian Labor Party] will be supportive of that because we have no choice. The alternative is simply too horrible to contemplate.”

According to the front page of The Australian (21 April), RAMSI is “our most ambitious foreign policy endeavour ever – pouring billions of Australian taxpayers’ funds into reforming and rebuilding the Solomons – with ill-defined goals and a largely ill-prepared, inexperienced and, in many cases, fairly ordinary crew.” This assessment is far too mild. Canberra’s aggressively interventionist foreign policies, including foreign “aid,” have failed miserably and on current form will fail ever more abysmally. Since RAMSI’s intervention, law and order have further weakened, corruption accelerated and “transparency” and “good governance” become ever more pathetic jokes. Australia’s intrusion in the Solomons has flopped and will continue to flounder even more appallingly because its politicians, for all their gusts of warm, fuzzy and resolute rhetoric, are utterly ignorant of the laws of human action. Having absolutely no idea what they are doing, they have blithely requested that RAMSI achieve the impossible.

East Timor, another unfortunate country on Australia’s doorstep, provides an instructive example. The riots that erupted in Dili on 28 April “are an ominous signal to the international community of the new state’s increasingly dangerous fragility” (The Australian 1 May; see also “Struggle for a Future: The Threat of a New Civil War Looms in East Timor” The Australian 4 May). The World Bank warned late in 2005 that, thanks to “an emerging broad culture of high-level corruption and of a government increasingly out of touch with the people,” East Timor faces endemic civil conflict. Incomes are falling, poverty is rising (“per capita income has declined to $US1 a day and there are few job opportunities outside agriculture”) and the rate of unemployment in Dili is estimated to be 80%. East Timor remains one of the world’s poorest countries, and four years after celebrating its independence it is going backwards (see also the UN’s Human Development Report 2006 – Timor Leste and East Timor: Torture and Mistreatment by Police by Human Rights Watch).

But wasn’t the intervention in East Timor a spectacular success of Australian foreign policy? After nearly six years and $2 billion of taxpayers’ money, haven’t Australian troops and police returned home triumphantly? Mr Howard certainly thought so. Welcoming some of them, he expressed “thanks, gratitude and respect to the men and women of the Australian Defence Force as well as the men and women of the Australian Federal Police for the remarkable job that they did in bringing peace, stability and freedom to the people of East Timor. ... This is a proud day, not only for the people of Sydney, but also for the people of Australia. We say thank you to the men and women of our forces for a magnificent job done in our name which has brought great credit to you and through you great credit to our nation.” But perhaps he spoke too soon; and in any case the rioters aren’t listening. According toThe Australian (1 May), “whilst their landing in Dili in 1999 was greeted with tears of joy, Australian soldiers are more likely to be targeted in 2006. Experts say Australian’s reputation with the East Timorese has deteriorated.”

Finally and for good measure, Fiji’s election on 6 May “could lead to Solomons-style chaos and instability” (The Australian 4 May). And a former Foreign Minister has urged that Australian soldiers and police be dispatched to Sudan (see “Time to Intervene: A UN Peacekeeping Force Is the Only Solution for Darfur,” The Australian 3 May).

The awful truth thus stares us in the face: across Melanesia, repeated Australian interventions over the years have done little good and much harm. Even more unspeakably, this point generalises to The Lucky Country itself. Hence also spare a sympathetic thought for the millions of Australians that are in the same unfortunate position vis-à-vis the Commonwealth Government as are Solomon Islanders and East Timorese. Governments’ policies of “humanitarian intervention,” whether at home or abroad, necessarily produce (or worsen) inhumane results. The “health care system” systematically delays and thereby denies medical goods and services. Similarly, “family assistance” weakens families; the “educational system” pollutes rather than enriches young minds; minimum wage laws impoverish pay packets; “foreign aid” hinders rather than helps foreigners, and on and on the sad pattern goes (see, as one example among many, Mythology of the Minimum Wage by D.W. Mackenzie). Governments, in short, are a kind of Typhoid Mary on a monstrous scale: they always, invariably and inescapably harm the very people whom they allegedly seek to help.

Why the endemic and intensifying breakdown? The welfare-warfare state has been erected upon the false premise that private property is profane rather than sacred. Accordingly, where property and rights to it are more communal than private, as they are in the Australian health, educational, social welfare and myriad other sectors, poor results emerge as reliably as night follows day. And in countries like the Solomon Islands and East Timor, where property rights (to the limited extent that they exist) are mostly communal rather than individual, corruption, coercion and the fragility and eventual breakdown of law and order are baked into the script. Policies of humanitarian intervention fail to generate their intended results and inevitably spawn harmful unintended consequences because they create and encourage rights to communal and state property, and thereby suppress and extinguish private property rights (see also In Defence of Non-Interventionism by Gil Guillory, What About Darfur? The Case Against Intervention by Justin Raimondo and True Foreign Aid by Congressman Ron Paul). This insight is hardly new. In Rerum Novarum (1891), loosely translated as “on the condition of the working classes,” Pope Leo XIII wrote that the “fundamental principle of Socialism, which would make all possessions public property, is to be utterly rejected because it injures the very ones whom it seeks to help.”

In sharp contrast, when state and communal property is privatised, not only is efficiency enhanced: morality is routinised. What, then, to do? Clearly, and as an urgent matter of both effectiveness and ethics, Australian politicians could do no better than simply to abandon their vast, growing and uniformly disastrous array of interventionist domestic and foreign policies. They must reduce these vast and ballooning budgets to $0, repeal the countless and multiplying regulations and issue pink slips and running shoes to the growing legions of bureaucrats. But Australians must not discard the benevolent baby with their governments’ coercive bathwater: if they truly wish to help less fortunate people in Australia and elsewhere, as many of them sincerely and admirably do, then they could do no better than to dismantle the Leviathan in Canberra and the state capital cities, and then provide an example to others of the benefits that inhere in private property and benefaction, individual effort and laissez-faire capitalism. In their own time and their own way, Solomon Islanders, East Timorese and others might then emulate this example by creating and enjoying the blessings to private property.

What, exactly, are these blessings? Justice, liberty, peace and prosperity. Equally clearly, however, pigs will fly, lions will slumber with lambs and Hell will freeze long before politicians cease their incessant assaults upon their hapless subjects (domestic and foreign). As a result, and as reliably as astronomers can chart the course of the moon, life for the victims of Australian governments’ humanitarian interventions is going to be needlessly grim.

Private Property, Glorious Private Property

The private ownership of property is a necessary condition of individual liberty. Where there is no private ownership, communal and state “leaders” will oppress and plunder. In Milton Friedman’s words, “you cannot have a free society without private property.” Private property is also a necessary condition of justice. Creating property and exchanging it in the market promotes the owner’s responsibility for the moral and material consequences of his actions. Private property erects walls, figurative and literal; and on those walls it hangs mirrors that reflect back upon its owners the repercussions, positive and negative, of their behaviour. Both the prudent and the profligate will thus tend to receive their just desserts. In particular, said James Q. Wilson, private property is a “powerful antidote to unfettered selfishness.”

Private property is also among the most peace loving of institutions. In a society where property is privately owned, goods and services must be created either through individual initiative or co-operation among individuals, and they can only be exchanged voluntarily. He who is free to create wealth through his own efforts and collaboration with others – and to keep and accumulate the proceeds of his efforts – need not covet others’ property. Accordingly, it does not behove him to plunder it. Where peace (i.e., laissez-faire economics) reigns, war (i.e., interventionist politics) is counterproductive. In a society where property is individually owned, not only is honesty the best policy: so too is industriousness.

It is important to emphasise that private property erects walls. And that’s a blessing, for these ramparts shield us from communes’ and governments’ coercion. To own property is to possess the means to formulate your own plans, mobilise the insights and information in your own head and follow your own star. Liberty, justice and peace thus enable us to act both harmoniously with but without interference from others. Finally, and for these three reasons, private property is a necessary condition of prosperity. Where a man enjoys liberty, justice and peace – where, in other words, others leave him free to regulate his own conduct and enjoy the fruits of his industry and improvements – he is likely to take heart, look to the future, strive on behalf of his wife and children to save, invest, work, accumulate capital – and thereby, morally and materially, to prosper.

What Are Property Rights, Anyway?

To reason towards these conclusions, it is important to clarify our terms. Historically (namely, since Roman times), property has been regarded as a relationship, sometimes de facto and other times de jure, between a person (or collection of people) and a thing (physical or abstract). People who possess property rights with respect to specified things possess enforceable claims upon those things. During the past century, it has become customary to regard these claims as “sticks” that combine to form a “bundle.” One stick is exclusion; another is physical alteration; a third is the unfettered enjoyment of the property and its fruits, such as income; and a fourth is the unhindered transfer of title of ownership. Accordingly, to possess property rights over a particular house is, for example, to be able to exclude others from its use, or to invite them upon the premises on your terms; to add another bedroom when and how you please; to consume the shelter it provides (or to rent it to another person on terms acceptable to you), and to bequeath or sell it to another person (again, on terms and conditions acceptable to you).

Broadly speaking, there are three variations of property rights: private, communal and state. Private property, which decentralises and formalises ownership, confers rights upon an individual or a strictly defined and enumerated group of individuals (such as members of a family trust, unitholders of a unit trust or shareholders of a corporation). Further, these rights are configured such that the benefits of ownership are borne on a pre-agreed basis – and the costs of ownership absorbed on a pre-agreed basis – by these owner-members. If a house is owned by a corporation, rented and rental income is generated, for example, then the proceeds might accrue to its owners in proportion to the number of shares they own.

Communal property, in contrast, confers the rights to some good or service to a less clearly defined group of people, and it configures these rights more ambiguously. What, precisely, does the communal property entail? No exhaustive and mutually exclusive map or list typically exists. Who, exactly, are the communal owners? Again, there is usually no definitive enumeration. Accordingly, the defining characteristic of communal property is that the benefits and costs of ownership are not delineated clearly and systematically. As a result, benefits from the ownership of communal property are typically harnessed by an ad hoc or exclusive subset of members (or even by non-members); similarly, the costs of ownership are often imposed upon another subset of owner-members (or outsiders). Finally, state-owned property confers rights in such an amorphous and haphazard fashion that it is tempting to say that “public ownership” is simply a slogan that distracts the attention of the hapless many from the plundering of the privileged few.

Communal and State Property Beget Injustice, Oppression, Conflict and Poverty

It is an axiom of human action, and thus something that politicians routinely ignore or deny, that these three configurations of rights to property spawn very different incentives and disincentives. Accordingly, in a given situation the owner(s) of private property on the one hand and communal property on the other typically behave very differently. So exactly how does private property promote justice, liberty, peace and prosperity? How does communal and “state-owned” property beget their opposites? As a hypothetical but realistic example, derived from Tom Bethell’s excellent The Noblest Triumph: Property and Prosperity Through the Ages (St Martin’s Press, 1999), consider a complex of (say 100) condominiums, townhouses and flats.

Let us assume that property rights to the dwellings within the complex conform largely to our definition of private property. A clearly specified individual or collection of individuals (typically a couple or family) has exclusive use of each dwelling; the boundaries of each dwelling are mutually exclusive and exhaustive; owners can alter or rent their dwellings and sell them on the market. Also assume that dwellings contain individual (that is, one per dwelling) thermostats but no individual utility meters. Instead, the entire complex is “master metered” as a collective – that is, there is a single, complex-wide electricity meter, one gas meter, one heating oil and one water meter, etc.

How, then are property rights to utilities allocated within this complex? Communally. More specifically, let us say that, by the consent of the owners, this occurs according to three rules. First, each owner may use as much water and energy as he pleases (for simplicity, let us assume that each individual, couple, family, etc., owns the dwelling in which he, she or they reside). Second, every month, owners pay a fee to the complex’s Body Corporate. Finally, every month the BC sums the collective expenses (including utilities) that it incurs, divides by 100 and sends invoices for that amount to each owner. From one month to the next, in other words, the BC fee will vary; but during any given month, each owner pays the same BC fee.

What kinds of behaviour does this communal arrangement encourage? Consider two stylised but realistic possibilities. Consider first Jane. She is a friendly owner-resident who is always ready to offer a cup of tea, a sympathetic ear and a helping hand. For these reasons, and also because she conscientiously conserves water and energy, she is well known and very popular among her neighbours. At her own expense, she has insulated the walls and ceiling of her flat, and has also installed a water-efficient toilet, shower nozzle and washing machine. She also minimises the time she spends in the shower, unfailingly darkens unoccupied rooms, lowers the thermostat in winter and increases it in summer, and otherwise does what she can to use as little water and energy as reasonably possible.

What does this considerate soul have to show for her discipline? As one of 100 owners, it is reasonable to assume that every month she will reduce the complex’s overall expenses by some modest amount. But she will personally recoup only 1% (1/100) of the total expense she has saved. In effect, Jane “exports” to the other 99 owners the vast bulk of the benefit of her frugality – but “imports” all of its cost (i.e., chillier winters, hotter and more humid summers, dimly-lit rooms, short and cold baths, etc.). Let us assume that her discipline reduces the complex’s utilities bill by an average of $25 per month. If so, then her Body Corporate fee falls by an average of only $0.25 per month.

Now consider Chris. He is an always civil but seldom overly friendly owner-occupier who allegedly works long hours (that, at least, is what he tells other residents when he scurries past them each morning and evening) and is thus seldom available to lend a hand or an ear to neighbours. But perhaps because he is energetically building a prosperous business, other owners forgive his eccentricities – like routinely leaving his high-wattage bulbs burning whether or not he is in the room (or indeed, within his townhouse). Further, during the winter he increases his thermostat so that even on the coldest days he can comfortably wear short-sleeved shirts, and in summer he commands his air conditioner to run 24 hours a day. He also ignores leaking taps and luxuriates as long as he pleases in his hot shower. And he tells his housekeeper never to hang his laundry on a clothesline: instead, she throws everything in the dryer.

What are the consequences of his actions? Every month, it is reasonable to assume, he will increase the complex’s overall expenses, but will personally incur only 1% of this increase. Chris “exports” to the other 99 owners the vast bulk of the financial cost of his profligacy – but “imports” all of its benefits (i.e., snug winters, cool and dry summers, long and hot showers, fluffy towels, etc.). Let us assume that his behaviour increases the complex’s utilities bills by $50 per month. As a result, his Body Corporate fee increases by a mere $0.50 per month.

As a specific example, consider what happens when Chris departs for a four-week Christmas holiday. On the way to his fuel-efficient car (hey, the full cost of the petrol it consumes comes straight out of his pocket) he contemplates turning off his air conditioner. But he quickly thinks again: if he does so then in a month’s time he will return to a hot and humid townhouse that will require several hours to cool. That is obviously several hours too long, and so he leaves the AC running 24-7 during his absence. Let us say that the cost of his decision raises the complex’s energy bill $15 above what it would have been had he turned off the AC. Whether consciously or not, Chris reasons that he will pay only 1/100 of this amount. Chris pays fifteen cents, Jane pays fifteen cents and the other 98 owners pay the remaining $14.70. Chris decides, in effect, that the cost to Chris of Chris’s self-regarding decision is so slight that less costly alternatives, such as leaving a key with Jane and asking her to turn on the AC a few hours before his return, do not enter his head.

But this waste does not end with Chris: over time, the average owner is ever less likely to resemble Jane and is more likely to imitate Chris. Under existing arrangements, the benefits of conservation are difficult to privatise and the costs of profligacy easy to collectivise. As a result, the financial rewards of conservation are slim – and so too are the costs of water and energy gluttony. Accordingly, over time the complex’s consumption of utilities and any other jointly metered expense is likely to rise. Clearly, then, “master metering” encourages consumption and discourages conservation.

But a corrective mechanism is readily to hand: the installation of a separate meter within each dwelling. The complex, it is vital to recognise, has neither a “water problem” nor an “energy problem” – it has a property rights problem. The problem is that property rights to utilities are insufficiently private. What to do? The solution is obvious: replace the communal right to utilities with a private right. Thanks to the walls that already separate each dwelling, water and energy consumption already are – indeed, always have been – private. The addition of private meters enables each private owner to receive bills that correspond to his (or his family’s) private consumption.

Note that a majority of the complex’s owners are likely to oppose, some of them stridently, this “privatisation.” The necessary rewiring and installation of private meters will entail a significant upfront cost. Its benefits (namely reduced utilities bills), on the other hand, may require several years to cumulate to the point where they significantly exceed the upfront cost. And recall that the collective arrangement discouraged conservationists and encouraged pigs; as a result, the number of the former is likely to fall, and the latter to rise, over time. More owners will act like Chris, and each owner votes (or, at any rate, has the opportunity to vote) at Body Corp elections. The result is likely to be a governing coalition of pigs.

The Body Corporate will also be reluctant to consider this privatisation because, whatever their rhetoric to the contrary, the owners – who, after all, select the BC – do not regard their “investment” in their dwellings as long-term. On average, Australians own their homes for less than seven years. And like Australians as a whole, valid logic and reliable evidence will often make little or no impression upon these owners. As a matter of facts and reasoning, separate meters are indeed likely to increase the value of the complex’s dwellings – particularly for frugal and other-regarding owners like Jane. But Chris and other hogs will likely ignore this relatively large unrealised long-term benefit (in the form of the higher market price of their dwellings) and focus upon the relatively small, short-term realised benefit (the receipt $X of utilities in exchange for less-than-$X of BC fees). Chris and his allies will thus tend to concoct some pretext, no matter how emotive, irrelevant, groundless and idiotic, to scuttle the privatisation.

There Goes the Neighbourhood

Let us take this example of communal rights to utilities to its logical conclusion. Assume that the executives of the Body Corporate, with the complaints of owners ringing in their ears, agree that the “master meter” system is intolerable. But they reject its privatisation not just because they dislike the upfront expense, but also because they dislike the idea of – indeed, the very word – “privatisation.” They begin to recognise that existing arrangements create “winners” (self-regarding people like Chris) and “losers” (other-regarding people like Jane), and they resolve that this result is unjust and must somehow be corrected. But how? We are Australians, and the most fundamental Australian value, say the babblers that pervade the country (particularly the kleptocrats in Canberra who brazenly use it to cloak their thievery), is the “fair go.” So thank goodness for warm and fuzzy words. Members of the Body Corporate thus resolve that they will “raise energy awareness,” “eliminate energy selfishness” and “achieve energy justice” within the complex – but without the “unfair” privatisation that will “benefit the rich” and “harm the poor” and thereby endanger the sacred “fair go.”

So what, in practice, will they do? The first step is typically exhortation. Volunteers post hoardings in lifts and along corridors and other common property, and stuff circulars into each owner’s post box. “Think of others, think of the environment, and do the right thing. Reduce your consumption of energy!” Jane, pleased that something is finally being done, continues and perhaps even increases her frugality. Chris, relieved and amused that nothing significant is being done, spouts the politically correct rhetoric at opportune moments but mocks its message. Eventually it becomes clear to everybody that windbaggery hasn’t worked – that is, the consumption of water and energy (and hence the monthly Body Corporate fees) continues to increase.

Because jawboning hasn’t worked, the Body Corporate turns to sterner measures. The failure of the campaign of exhortation has dampened spirits and thus stemmed the flow of volunteers, and so the BC (on the advice of paid consultants) hires “energy monitors” to patrol the corridors, knock on residents’ doors and admonish them to conserve utilities. (“The weather’s just turned cooler. Have you turned off your AC? Fixed all the leaking taps?”) Initially, most residents politely assure the monitors that they’re doing the right thing and indignantly insist that the problem lies with other owners. After a few months, many residents, tired of the badgering, simply ignore the knocks. Jane, pleased that something else is being tried, disappointed that nothing has yet worked but secure in the knowledge that she’s doing the right thing, continues (albeit with less fervour) to economise. Chris claims that he’s at work and so is never at home to hear the knocks. Further, secure in the knowledge that nobody (least of all Chris) knows how much he consumes, he continues (with just as much enjoyment) to consume as much as he damn well pleases. The average resident complains ever more loudly about the relentlessly rising fees, deplores the “budgetary problem” that is emerging (“we can’t afford proper communal childcare because the communal energy bill is so high!”) and demands ever more vociferously to the Body Corporate that it “do something.”

In response to the rising pitch of complaints and after much hand wringing and some rancour, the Body Corporate enacts drastic action. The complex’s Constitution is amended such that every owner must provide a spare key to an expanded force of energy monitors. The BC reassures residents that their concerns about privacy are groundless because the monitors will enter dwellings only after knocking and receiving no reply. And besides, sneers the Body Corporate with not a little impatience, “if you’re doing the right thing then you have nothing to fear.” Jane, who has unfailingly done “the right thing” from the start, resents the imposition and worries what might happen in her dwelling whilst she is at work or on holiday. And if Person A with a key can enter her flat when she’s not there, what’s to prevent A (or somebody to whom A has given her key) to enter when she is there? Chris anticipates the intrusion upon his property and takes precautions to avert it. Rather than surrender his key, he offers to pay the monitors to leave him and his townhouse alone. Receiving money from both Chris and the BC, and lacking any mechanism to ascertain the efficiency and effectiveness of their services, the monitors are more than happy to accept his offer.

But consumption and hence fees continue remorselessly to rise, owners become desperate and so draconian measures are eventually approved. The Body Corporate will issue special ID cards to owners and their families, and hire electricians to rewire the complex such that lights, AC, heating, etc., work only when the ID card is swiped into a monitoring device installed inside each dwelling. Consumption of electricity, gas, water, etc., will be permitted only during certain hours decreed by the Body Corporate; and once consumption within each dwelling reached some specified threshold, no further energy will be supplied. Further, owners must provide bank account details to the Body Corporate, which will directly debit its fees every month. If owners will not do “the right thing” voluntarily, then the BC, in the name of “energy justice,” will bloody well force it upon them! Is this justice? Jane belatedly realises that her home is no longer her castle: it is effectively her prison. But Chris remains unaffected. Alerted well ahead of time by friendly energy monitor contacts, who told him all he needed to know in exchange for a generous gratuity, he sold his townhouse and left the complex.

Note the sad state of affairs that has come to pass: the Body Corporate has saddled owners with inexorably rising utilities fees, and now massive “infrastructure” and “social justice” expenditures. It has also weakened owners’ feeling of safety within their dwellings, and in these and other ways has threatened their property rights. It has also eroded owners’ means and motive to maintain their dwellings. Roofs, for example, fall into disrepair because residents can no longer afford to maintain them; and they can no longer afford this expense because their BC fees have exploded. For all of these reasons, the market prices of dwellings within this complex fall steadily. Who on earth wants to live in a ghetto of high taxes, poor services and quality of life and growing compulsion? What was once a pleasant place to live no longer is. Owners belatedly realise that they have a property rights problem – their property is disintegrating before their very eyes – but the linkage between the collective organisation of utilities, the laws of human action and their present woes continues to elude them.

Finally, and not least, note that all steps short of coercion and impoverishment have failed to stem the consumption of energy – the very “problem” that originally prompted the rising spiral of interventions! One poor policy – the initial, collective allocation of property rights to utilities – has prompted a cascading series of ever more destructive interventionist policies. One intervention after another has inflated costs, decreased benefits, attacked morality and shrunk liberty. Note, then, the fundamental principle: if rights to property are collective rather than individual, then both efficiency and justice suffer; what begins as exhortation eventually becomes coercion; the more compulsion, the weaker the rights to private property; and when coercion replaces liberty, prosperity as well as justice evaporate.

The Innate Virtue of Private Property

According to Gresham’s Law, bad money (i.e., fiat money) drives out good money (i.e., gold). According to Garret Hardin, when the right to given property is organised communally, good deeds with respect to that property tend to be punished and bad ones rewarded. In Hardin’s Tragedy of the Commons, of which our example is an instance, selfishness and waste vanquish prudence and consideration of others. When a communal property right becomes a private right, on the other hand, virtues are promoted and vices restrained.

For two reasons, the results of the master-metered billing arrangement are unjust. First, despite all the fair-sounding rhetoric, Jane’s consideration (that is, the desire to conserve resources and minimise the costs she imposes upon others) is penalised. Injustice also arises because the communal arrangement enables – indeed, it encourages – Chris to impose upon others the costs that rightfully should fall upon his own shoulders. Whether he does it consciously or not, by exploiting the communal arrangement for all it is worth Chris acts selfishly. In effect, the communal billing system pays Chris to do the morally wrong and economically wasteful thing. That is, it behoves him to be both spendthrift and selfish. This result generalises. Selfishness, which most Australians insist is the great moral flaw of private rights to property, is actually far more likely to arise in situations where private property either does not exist, or where the definition and enforcement of private rights to property are difficult to achieve.

To see this fundamental point, let us return to our example. This time, however, suppose that a majority of owners quickly detect the perversities of the communal billing system and agree to install private utility meters. What impact are these new arrangements likely to have upon the behaviour of Jane and other considerate people? Probably little or none. How will these new arrangements affect these people’s spirits? They will likely bolster them. Recall that Jane strives to conserve energy. The new arrangements reward this virtue and thereby give her a financial incentive to continue her efforts. How so? The amount she pays for utilities now depends upon her actions (which she can control) and not upon others’ actions (which she can’t). Given her discipline, once rights to utilities are privatised, her bills (which now accurately reflect her consumption) are likely to fall significantly. Every month, her relatively modest bill reminds her of (or, like a mirror, reflects back to her) the financial benefits of prudence. At last, she reaps the positive benefits of her actions. Jane rejoices at her savings and the uses (whether accelerating the repayment of her mortgage, hosting dinner parties, undertaking face-to-face charity to the less fortunate, etc.) to which she can apply them. As a result, under these private billing arrangements more people will tend to act like Jane.

What impact are these new arrangements likely to have upon the behaviour of Chris and other utilities pigs? Probably some and perhaps much. How will they affect their spirits? Initially, they will likely deflate them. Recall that Chris, perhaps without realising it (how could he? Without a personal meter he could only guess how much he consumes) is predisposed towards water and energy gluttony. The new billing arrangement punishes this vice and thereby gives him a financial incentive to correct it. How so? Under the new arrangement, he continues to “privatise” the benefits of his profligacy; but he can no longer “collectivise” their costs. Private rights to property reflect both the benefits and the costs of his gluttony back upon him. Given his indiscipline, once rights to utilities are privatised his bills are likely to rise considerably. Every month, these bills remind him of his imprudence. Chris bewails the opportunity cost that now stares him in the face: either he economises his use of water, electricity, etc., or he tightens his belt elsewhere (i.e., he must spend less time at the pub, etc.). At last, he must confront the negative consequences of his actions. As a result, under these private billing arrangements fewer people will act like Chris.

Imagine that Chris is once again preparing to depart on a month-long summer holiday. This time, however, he has a much stronger incentive to turn off his air conditioner. He knows that if it remains running during his absence it will consume $15 of electricity – and that he will have to pay the entire amount. If he switches off the AC, does he act selfishly? It makes no sense to say that somebody who acts prudently thereby acts selfishly. But suppose that Chris again decides to leave his AC running. Perhaps his dislike of a hot townhouse upon his return outweighs the additional $15 he will have to pay. Is this decision selfish? It may be wasteful, but if he bears all of its consequences, positive and negative, then how can it be selfish? It is in this fundamental sense that the privatised billing arrangement is fair. Just as Jane’s reward (namely lower bills) relates directly and proportionately to her virtue and discipline, the penalty borne by Chris relates directly and proportionately to his vice and extravagance. If Chris’s bank balance is low because he extends his profligacy and indiscipline to other areas of his life, then we may say that his decision to leave the AC running is stupid and harms himself. But idiocy and self-harm are not selfishness.

A startling (to sceptics and opponents of rights to private property) result emerges from this extended example. Where rights to property are communal, it makes sense to describe some actions (like Jane’s) as public-spirited and others (like Chris’s) as selfish. But when private property supplants communal property, it no longer makes sense to talk of either public-spiritedness or selfishness. It is precisely in situations where private rights to property are imprecisely defined (or not defined at all) that selfish acts are possible. It is in these situations that the individual, considering his own interests, has the opportunity to “export” his costs to others. A selfish person is one who takes a disproportionately large share of some common good and leaves unreasonably small shares for everyone else. But where all the shares have been defined and allocated, selfishness is no longer possible. We may therefore turn the tables on Australians who say that if private property “works” then it does so only because it gives free rein to selfishness. We may retort that, where private property does not exist, it is actually selfishness that will be given free rein. As Garret Hardin wrote, it is communal and not private property that breeds “harsh egoism, inequality and injustice.”

In Summa Theologica, Thomas Aquinas stated “the act of justice is to render what is due. ... Justice, properly so-called, is one special virtue, whose object is the perfect due, which can be paid according to an exact equivalence. But the name of justice is extended to all cases in which something due is rendered.” By ensuring that something due is rendered – such as high bills to squanderers and low bills to conservers – private property advances justice. The privatisation of property rights to utilities illustrates this seminal definition of justice.

The great moral blessing of private property is that it enables people to benefit from their discipline, industry and frugality, and also to insulate themselves from others’ sloth, recklessness and profligacy. Property is like a mirror that reflects back upon its owner the ethical consequences of his actions. The industrious will reap the benefits of industry, the frugal the consequences of frugality – and likewise the improvident, slack and idle the results of these vices. People will usually receive their due, which is to say that they will experience justice as a matter of routine. Private property, in other words, routinises and institutionalises justice. This, its greatest blessing, dwarfs its many other material benefits.

Stepping Stone or Stumbling Block?

The question naturally arises: what on earth has this analysis to do with the lamentable state of affairs in the Solomon Islands (and Melanesia and the Third World more generally)? If you agree that

  • The owner(s) of private property on the one hand and the owners of communal property on the other typically behave very differently, and that
  • in our example there was neither a “water problem” nor an “energy problem” – there was a property rights problem, then you can see for yourself that
  • in the Solomon Islands, East Timor and elsewhere, there are no “law and order” or “corruption” or “transparency” or “governance” problems. These things are symptoms of pervasive property rights problems. The crux is that rights to capital, labour and land are poorly defined, improperly respected and insufficiently private (see in particular Hernando de Soto’s two books The Other Path: The Invisible Revolution in the Third World, HarperCollins, 1989 and The Mystery of Capital: Why Capitalism Triumphs in the West and Fails Everywhere Else, Basic Books, 2000).

Is there any field within mainstream economics whose rhetoric is more ambitious and whose results have caused more needless suffering than “developmental” economics? Since roughly the end of the Second World War, tens of thousands of Western “experts” have descended upon impoverished countries, and hundreds of billions (one estimate is two trillion) dollars have followed in their wakes. Alas, in those places where these economists were taken most seriously, like the Indian Subcontinent, poverty endured; and in other regions, notably Africa, it became worse. During the 1960s, 1970s and 1980s, developmental economists’ concepts and theories became ever more absurd and their methods more arcane. And all the while the gap between rich and poor nations grew. Alas, and perhaps because most Western emissaries accepted the gist of Communists’ claims, they utterly ignored the legal foundation of Western prosperity. Ironically, by imposing central planning and state property upon the hapless people of the Third World, they perpetuated ideological colonialism. Without any understanding of what they were doing, the emissaries of “economic development” undermined in poor nations the very institutions that in the West had spawned prosperity.

In one sense, the emissaries enthused about property – namely land and its expropriation from X and redistribution to Y. Indeed, for a generation of development economists, land reform was pursued doggedly and sometimes fanatically. But land reform has yielded few benefits and exacted massive costs. It is exceedingly difficult to alight from the business class section of an aeroplane, unpack at the exclusive hotel, lunch with the minister, wave a wand, expropriate the property of a few solely on the grounds that they are wealthy and thereby create property rights that are regarded as legitimate. It is quite astonishing that these emissaries seriously expected that Bolshevik means would yield Jeffersonian ends. The trouble is that theft delegitimises rather than redistributes property. And in a number of countries, including Chile, Cuba, El Salvador, Iran and Vietnam, land reform both undermined the local economy and created (or contributed to) political turmoil that begot a spiral of even more misguided Western interventions – some of whose unintended consequences politicians and bureaucrats confront, equally uncomprehendingly, to this day.

It is difficult to exaggerate Western economists’, politicians’ and bureaucrats’ fetish for central planning in impoverished countries during these years. Planning was thought to be scientific; and science, they just knew, would solve any problem. In particular, mathematical economics was rational and respectable and therefore unanswerable. As far as developmental economists were concerned, economic development was a matter best left to economists and their slide rules (and later computers). They collected data, tweaked models and published research. Once the barons of the seminar room and conference circuit were satisfied with their models, they nodded to politicians and the tsunami of “development aid” flowed into the hapless country. As India’s PM, Jawaharlal Nehru, told a journalist in 1960: “planning and development have become a sort of mathematical problem which may be worked out scientifically.”

These mathematical models regard capital and labour as things that are simply “supplied.” The truth, of course, is that individuals never voluntarily exchange their labour without a commensurate return. And capital is even more skittish: it takes flight at the first sign of trouble. The problem is that foreign aid, mislabelled with the title “investment,” was (and usually still is) considered, for all intents and purposes, to be equivalent to and interchangeable with private investment. But by the time a politician or bureaucrat in (say) Canberra dispatches money to a politician or bureaucrat in (say) the Solomon Islands, it has long since ceased to be capital. And it never was investment by any reasonable conception of that term. Private investors expect that their capital will yield a return; but no politician or bureaucrat in either Canberra or Honiara ever pays the smallest price or receives the slightest disapprobation when he squanders the proceeds of theft from Australian taxpayers. What emerges at the end of the pipeline is a windfall of spending money; and because its senders and receivers are bureaucrats and politicians, it is always bureaucratised and politicised spending money.

Perhaps most farcically, in order to compete with the Soviet Union for influence in these countries, Western “experts” counselled, in effect, that these countries reorganise their economies along Soviet lines! “Under capitalism,” said the recently departed John Kenneth Galbraith, for a time America’s ambassador to India, “man exploits man. Under communism, it’s just the opposite.” According to Nehru, “it is extraordinary how both Soviet and American experts agree on [mathematically-based planning]. If a Russian planner comes here, studies our projects and advises us, it is really extraordinary how his conclusions are in agreement with those of, say, an American expert. ... The moment the scientist or technologist comes to the scene, be he Russian or American, the conclusions are the same for the simple reason that planning and development today are almost a matter of mathematics.”

They’re Still Central Planners After All These Years

Since the 1990s, in the wake of the collapse of Communism, things are different – but not that different. The old and rancid wine of central planning remains: but it now appears in a new and – to many people – attractive bottle. Planning is now less a matter of dams and steel mills, and more a matter of “law and order,” “governance,” “transparency” and “democratic institutions.” Accordingly, an appreciation of the absolutely fundamental importance of private rights to property and their voluntary establishment is just as alien to today’s Blairite and neo-conservative (i.e., ex-Trotskyite) central planners as it was to the proto-Soviets of yesteryear.

As a hypothetical but realistic example, again consider a complex – this time in the Solomon Islands – that comprises 100 houses, huts, shanties and hovels. Let us assume that rights to the dwellings conform neither closely nor uniformly to our definition of private property. Only sometimes (let’s say in 50 cases) do individuals or a collection of individuals have undisputed use of a given dwelling. In the other 50 instances, the dwelling is either communally owned or various contending individuals or groups claim ownership. Lacking clear title to “their” dwellings (whose boundaries, compounding the problem, tend to be indistinct and overlapping), the 50 squatters or groups of squatters fear to improve them. Why add a bedroom to or strengthen the foundations of a house if another claimant might forcibly eject you from the premises? Further, squatters cannot easily rent such dwellings. To do so is, in effect, to invite the renter to claim squatters’ rights. Squatters thus cannot sell “their” dwellings on the market. Who in his right mind pays good money for something lacking clear title?

Also assume that among these dwellings there is no “master meter” arrangement. How are property rights to utilities allocated? Privately. So far, so good. The trouble is that underlying rights, namely property rights to dwellings, are variable and indistinct. What kinds of behaviour does this encourage? Consider two stylised but realistic possibilities. The first comprises owners who possess clear titles to their dwellings. Like any other owner of private property, they may be self-regarding. But their status as legitimate owners of dwellings gives them an incentive to pay for the water, electricity, etc. that registers on their meter, and hence to economise their usage. To do otherwise, i.e., to violate the property rights of the utility, is to erode the general respect for private property – and thereby, in effect, to weaken the title to their dwellings.

Now consider the squatters. They may well be predisposed to be considerate and to respect others’ property. But their relatively vulnerable status gives them less incentive than owners to pay for water, electricity, etc. In one sense, of course, they may be unable to do so – for they are unlikely to have a meter in their dwelling. Why not? For exactly the same reason that discourages them to improve the dwellings they inhabit. Lacking clear title, and therefore fearing dispossession, they hesitate to outlay the capital required to install the meter. Whatever their personal morals and ethics, however, some may be tempted to arrange “pirate” access to the water or electricity grid. Yes, such action may lead to detection and expulsion. But the risk of dispossession exists whether or not they “pirate” the grid. Hence their temptation to violate the property rights of the utility, further and unintentionally to erode the general respect for private property – and, perversely, to invite others to challenge their titles to their dwellings.

What are the consequences of pirating? The utility produces amount X of (say) electricity, but (depending upon the extent of pirating) receives payment for a lesser amount. How does it react? It can (a) attempt to detect the pirates, and either expel them from the grid (and perhaps prosecute them) or somehow turn them into paying customers; or (b) increase the rates charged to paying customers in order to recoup the shortfall siphoned by the pirates. The results of neither possibility are carved in stone. If (a) successfully turns pirates into paying customers, then bravo; and if this action implicitly acknowledges and strengthens squatters’ rights to the property they inhabit, then so much the better. But if the utility pursues option (b), and if it thereby encourages paying customers to become pirates, and thereby weakens property rights, then so much the worse.

What is clear is that the “pirating problem” is a symptom of an underlying property rights problem. In this and similar situations, if you are an outsider and want to go into business for yourself, you practically have to do so illegally. As a result, the implementation of individuals’ long-term plans is fraught with risk. Why save and invest when savings and their proceeds might be confiscated? Those laws that are enforced (namely some people’s private rights to property) protect privileged “insiders” from the competition of “outsiders” whose rights are either disputed or denied. Lacking clear titles to property, outsiders cannot use their houses as collateral for business loans, and they dare not grow crops that promise better long-term returns but require significant upfront investment. Recall that only property owners select a “Body Corporate.” Accordingly, in the commercial realm this legalised exclusion serves to create and preserve the privileges of a business elite, which in turn controls the laws and the lawmakers. The result bears an uncanny likeness to something that Adam Smith called “mercantilism.”

Clearly, then, where rights to private property are fragile, capital cannot easily accumulate and insecurity and poverty are the rule; and where these rights are well defined and respected, commerce and capitalism can flourish and prosperity result. Equally clearly, then, Canberra’s interventionist foreign policy, RAMSI, “development aid” and pursuit of “law and order,” “governance,” “transparency,” “democratic institutions” and all the rest of the buzzwords are simply a waste of time and money. At best, they ineffectively treat symptoms and consequences. And at worst they subsidise and strengthen the high-taxing and high-spending “Body Corporate,” but do nothing for – indeed, they help – the government to featherbed insiders and tyrannise outsiders.

“Laissez Faire” Means “Stop Thwarting the Locals”

What, then, to do? The answer is reasonably straightforward – and therefore inconceivable to most Westerners and their rulers. It is instructive to recall that in Britain and Western Europe, the clear rights to private property that underlie capitalism were not imposed. Nor did they suddenly emerge. Instead, they took centuries of fits and starts (and steps forward and backward) to evolve. So unnoticed was this evolution that Europeans and Americans have at best taken it for granted and at worst kicked the goose that lays the golden eggs. Oblivious to the vital importance of rights to private property, it is hardly surprising that they have failed abysmally to incorporate a proper veneration of it into their domestic and foreign policies.

It is also instructive to recall that in a surprisingly large number of places – ironically, perhaps especially in sub-Saharan Africa – local people acting peacefully among themselves began, just as the foreigners and planning fetishists descended upon them, to lay the foundations for a better future (see in particular George Ayittey, Africa Unchained, Palgrave 2002). In Africa, most land was tribally (i.e., communally) owned, and therefore subject to the tragedy of the commons. But there was so much of it that, for thousands of years, many tribes could migrate to unpopulated areas and thereby allow the degraded land to recuperate. But as population increased, tribes bumped into one another, not always peacefully, and another way to allocate rights to property was needed.

What did local people begin to do? During the end of the colonial period, individual tribesmen began to establish boundaries over land, respect these boundaries and buy and sell land. In so doing, they acted more as individuals and less as tribesmen. Alas, colonial administrators baulked because (never mind that it was economically necessary) such trade was not “customary.” Patterns of land tenure bearing ever more characteristics of freehold title began to arise, but colonial governments and courts would not recognise them because they contravened “native tradition.” It was true that when populations were low and land was as plentiful as air and water it had not been privately owned – but precisely the same could be said among the early Britons, Gauls and Saxons. But now the natural inclination of communal tribes to evolve into private families – just as Europeans had done millennia earlier – was frustrated by contemporary Europeans. After independence these countries’ indigenous rulers were encouraged to suppress the emerging private rights to property and to embrace the bright future of central planning and state ownership of property. And, as night follows day, tragedy ensued.

We conclude, then, that in the Solomon Islands and East Timor, there are no “law and order” or “corruption” or “transparency” or “governance” problems: these so-called “problems” are symptoms of pervasive property rights problems. Their crux of the real problem is that rights to capital, labour, and consumer goods and services land are poorly defined, improperly respected and insufficiently private. When he uttered the words in the opening quote, Alexander Downer spoke much wisdom. In so doing, he probably said much more than he realised. In the words of Noah Feldman (What We Owe Iraq: War and the Ethics of Nation Building, Princeton University Press, 2006), “the ethical challenge is [to consider] the dozens of failed nation building exercises around the world, legacies of both Wilsonianism and the differently oriented nation building of the Cold War. The high failure rate strongly supports the basic intuition that we do not know what we are doing – and one of the crucial elements of any argument for [non-interventionism] is that people tend to know themselves, better than others, how they ought best to live their lives.”

Australians: the South Pacific’s Biggest Cargo Cultists

If you accept (or are at least prepared to consider) this conclusion, then also consider two additional conclusions. First, in Queensland (and elsewhere in Australia, and in Britain, and Canada, etc.) there is no “health care crisis” – there is a crisis of property rights in the sense that, thanks to the Commonwealth and State governments, rights to medical goods and services are poorly defined, improperly respected and insufficiently private. And in Brisbane (and who knows how many other cities), there is no “water problem” or “traffic problem” – there are property rights problems in the sense that – you guessed it, and thanks to the all three level of government – access to water and roads are insufficiently private.

More generally, the alleged failures of markets are actually manifestations of the inadequacies and abject failures of states – particularly the suppression, corruption and confiscation of private rights to property. As a final extension of our line of reasoning, consider a government’s budget (national, state or local council – you decide). With our “meter” example in mind, this budget can be regarded as a communal pool of money that is replenished every year with the property that is looted from the government’s subjects. Gathered around this communal pool, like wolves circling a terrified lamb or bullies tormenting a shy schoolboy, are politicians. They are powerful because as a group they have the exclusive right to siphon money from the pool. Politicians drain the pool, keep some of the proceeds for themselves and bureaucrats, and channel the rest to favoured mascots in their constituencies. Party labels are an irrelevant distraction because politicians’ disagreements about the extent and nature of the siphoning are trivial, and their agreement-in-principle about the necessity of siphoning is deep and unshakeable.

Notice that government expenditure in Australia, Britain, Canada, New Zealand, etc. rises remorselessly for exactly the same reason that utility consumption rises inexorably in “master metered” complexes. Democracy in Australia and similar countries is “master metered” because taxpayers, much like residents of the complex in our original example, pay “Body Corporate fees” at the same rate. In Australia, the Commonwealth Tax Act is uniform across the country, and so too its counterparts in other countries. This communal arrangement encourages taxpayers and hence politicians to behave like pigs – that is, to drain the annual pool as quickly as they can. As in the complex’s Body Corporate, so too in the parliament: given these communal incentives, a coalition of pigs inescapably emerges.

Consider now the political equivalent of Jane. Let us say that she campaigns on the promise that, if elected, she will strive to reduce the amount of common-pool resources that her constituents consume. Not only will she propose to reduce overall consumption across the country: she will propose legislation stipulating that people in her constituency consume less than their “fair share” of the common pool. This pollie proposes that her constituents economise their consumption to some relatively frugal level – but still pay their full share of “Body Corporate fees.” The problem, of course, is that this restraint, as noble and considerate to others as it might be, is as futile as Jane’s was. It does not encourage other politicians to reciprocate. Quite the contrary: it leaves them more money to siphon into their constituencies. Clearly, this candidate will never be elected.

What is the solution? Is there a political equivalent of individual utility meters? As a modest suggestion, why not amend the tax code so that taxes can be adjusted up or down in each constituency according to the amount its Member of Parliament votes to spend? Big spenders would then impose a heavy burden of tax upon their constituents, and low spenders a light burden. But why stop there – why not extend these ideas to their logical conclusion? Why not reduce the size of parliamentary constituencies so that each voter can exert a greater influence upon which candidate is elected, and so that the actions of MPs conform more closely to their constituents’ desires? Indeed, why not reduce the size of “constituencies” to one person (or one couple or family), such that each person or head of  family is effectively his own MP, and thus reaps the maximum benefit – and incurs the maximum cost – of his decisions? Forget “one man, one vote” – one man (or couple or family) and one meter is the way to go!

Why not, in other words, shut the stupid parliament, dismiss the evil politicians, extend self-government to its logical limit and thereby let laissez-faire capitalism flourish? But back to the real world: it is the safest thing to predict that, just as Chris and his coalition of energy pigs scuttled the privatisation of the utility meters, today’s political pigs and their legions of selfish mascots will foil this “ultimate privatisation.” And their grounds will be equally emotive, irrelevant, groundless and idiotic.

Attention Politicians: First, Do No Harm

What, then, to do? A first step is to acknowledge that the Australian government’s policies of “humanitarian intervention” cannot help unfortunate people in impoverished countries. These policies of inhumane meddling always increase, and never decrease, the incidence of poverty and war. Australian politicians can do one thing and one thing only that truly benefits disadvantaged people: they can dismantle, destroy and abandon all barriers to trade. How to help the less fortunate? Let them sell to you what they are best able to produce. The trouble, of course, is that politicians’ desire to featherbed domestic producers vastly exceeds their desire to help producers and employees in poor countries. Australian politicians apparently believe that taxpayers are rich enough to afford the boatloads of handouts sent to other countries but that domestic businesses are so fragile that they cannot withstand competition from these same countries. As a result, it is apparently insufficient to tilt the footy paddock such that it favours Australian businesses and punishes Australian consumers: apparently it is also necessary either to place lead weights around foreign producers’ and employees’ ankles or to bar them from the oval.

If Australians really want to help East Timorese, Solomon Islanders and others, then they should insist that Australian politicians and bureaucrats cease their incessant and destructive meddling in their neighbours’ internal affairs. Among many other things, halt the “aid,” repatriate the troops and police and never again send them abroad. Non-interventionism and paleolibertarianism, and not protectionism and neo-conservatism, are the ways of civilised people. Australians must therefore abandon the sense of moral superiority that prompts them to imagine that if foreigners would only think and act like Aussies then everything would be just dandy. They should also recognise that non-governmental “local platoons” that rely entirely upon private donations and face-to-face contacts can do much to alleviate individual-level suffering. The Carpenter of Nazareth did much to assist poor individuals and to heal sick individuals: but he lifted not a finger to strengthen Caesar. Australians might therefore make their own enquiries, satisfy themselves that their contributions will reach their intended recipients, achieve what they intend to achieve and produce few or no unintended consequences. On that basis, they can donate generously.

Finally, realise that “humanitarian interventionism” fails just as abysmally at home as it does abroad. Acknowledge, therefore, that although you may not be interested in politics, politicians are intensely interested in you – and, more specifically, in controlling you and your family, property and life. So look through pollies’ warm and fuzzy rhetoric. Recognise that they do not know what they are doing, and that their policies are, in effect, vast experiments upon unsuspecting guinea pigs. Recall that, stripped of their many complexities, experiments comprise two groups: an experimental group (upon whom politicians concentrate their interference) and a control group (whose members they leave in relative peace). Markets produce permeable classes; but states, politicians and their mad experiments construct rigid castes. What, then, to do? Above all, strive at all times to remain beyond the clutches of the state’s “experimental” group.

The sobering reality is that if (as H.L. Mencken cautioned) politicians’ “urge to save humanity is almost always a false front for the urge to rule” then Australians, East Timorese, Solomon Islanders and others have much to fear from the Leviathan in Canberra. All politicians promise that they will be good masters, but make no mistake: they intend first and foremost to be masters. C.S. Lewis has the last word: “of all tyrannies, a tyranny exercised for the good of its victims may be the most oppressive. It may be better to live under robber barons than under omnipotent moral busybodies. The robber baron’s cruelty may sometimes sleep, his cupidity may at some point be satiated; but those who [insist that they] torment us for our own good will torment us without end, for they do so with the approval of their own conscience.”

Chris Leithner


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