On David Friedman and Liberty Minecraft
The Machinery of Freedom was written in 1973 by David D. Friedman. He captured beautifully, if not intentionally, a moment of intellectual vigor, that feeling of glee and wonder and daring. Through this lens Friedman looked at everything anew. It is how I imagine the history of science right after the invention of optical microscopes: looking close is unsettling.
Ethical philosophy was alive at the time, and scary. If you still are not sure what I mean, take a close look between your couch cushions and under the rug. Friedman and others discovered a mess. I expect they always believed it would be there. But it was not crumbs they wanted―and still want―to sweep away.
A Sailor Invented the Wheel
The Machinery of Freedom describes the æther in which libertarians stew. Fifty years on, it still seems like the original source code for libertarian non-player-characters (NPCs). His arguments are known to me a thousand times before reading this book. Wonderfully, Friedman is still well and alive. Like a joke I have not understood, Friedman is not a libertarian; he is an anarchist.
Features of a Friedman Society
Friedman observed in his time that arguments from principle land with little impact. He wrote that utilitarian arguments by contrast can appeal to a person’s values. These were the tools he had. Today, it is becoming easier to build alternatives and demonstrate advantage by comparison.
“The market for liberty has room for small firms.”[1]
Increasingly, it is possible to create digital versions of arbitrarily defined societies and explore them in non-arbitrary ways. Games are more capable than most people can imagine. Real people with real preferences can act with scarce means to achieve goals, developing a real economy, community, and society in a digital world. Here the risks, costs, and barriers to entry are low. A child with an allowance can become emperor of their digital universe without risking life and liberty. The learning curve is gradual because mistakes are not ruinous. The fact that none of this is real is a benefit, not a hindrance.
Zoomers are exploring statecraft without the State in just the same way that one can play chess without first having to vote for Grandmasters. The generation of statesmen which this learning environment produces will make our leaders look that much more like blathering morons. I am hopeful that this can produce the fastest increase in freedom the world has known. My purpose today is to explore Friedman’s proposals with digital examples, as they exist in Minecraft. Minecraft is the best game to use because almost everything in the game is caused by player choices. It is a sandbox world. We will consider The Firm, immigration, private streets, sub-cities, competing protection agencies, and mention ideas that Friedman explores in his book which our digital community may yet explore.
Differential Taxes and the Firm
Friedman observed in the late 1960s that firms (companies) were growing larger, reinvesting capital, and earning lower returns per dollar invested. He reasoned that because capital gains taxes were lower than taxes paid on dividends, capitalists were responding to economics and growing their market cap, acquiring businesses, and centralizing resources. Friedman predicted that removing taxes, or at least the special treatment of capital gains taxes, would lead to smaller businesses (and better use of resources):
“Consider a free-market society in which theft does not exist. Suppose that some change, social, technological, or whatever, suddenly makes theft possible. What is the overall effect?”[2]
In a digital world, this becomes a testable hypothesis with voluntary participants. One can operate a world in which theft is impossible. Then, one may create business accounts and make changes to tax heavily when resources are drawn and tax less when the business is sold (in part or in whole). One may observe by comparison whether businesses centralize and grow large by running an exact copy of the world which lacks those taxes. One gets to see the overall effect.
In Liberty Minecraft, there are no taxes. Firms are nearly always small. Resources can be moved in or out of a business at will. Our active population is perhaps 40 players. There are more than a thousand shops. Today one of the largest firms in LMC is the Grand Bazaar, where perhaps ten shop managers offer over 80 different items, but the property is all owned by one person.
Improved Standard of Living by Immigration
Friedman observed that unrestricted immigration up to and during the early 20th century was responsible for the great economic condition enjoyed by Americans. By Friedman’s time, the Overton window had shifted: up to a quota, decide and select which preferred groups may immigrate. The idea of eliminating immigration laws was gone.
On account of being so perilous today, it is hard to imagine that discussing immigration was this troublesome in Friedman’s time. One wonders if he felt the same butterflies even while writing what he knew to be true. There are simple ways to look at some problems. On premise, certain people will reject private property as that simple way, but their rejection precludes them from justifying their position because the act of justifying ones position necessarily employs private property.
In a digital world, access control is hard-coded. Who can use what when, where, and how can all be programmed in advance. Provided the digital world is not hacked, the owner decides. In Liberty Minecraft, players are free to own property on the condition that they resolve nonviolent disputes nonviolently. There is still room for improvement, by removing central authority.
Beginning in 2017, an experiment compared the economic growth of two areas in Liberty Minecraft. One can observe the results in a one minute time-lapse. The right side had private property. The left side did not. The same experiment can be conducted by restricting migration instead of ownership.
Who Will Build The Roads?!
Friedman argued for private streets. He imagined that usage could be paid for in real time with fees. He wanted to solve overcrowding (and almost everything else) with economics. If there is no price mechanism, then valuable goods are under-produced and/or wasted.
Friedman supposed that technological changes would make it easier to have small fees to pay for usage. More recent examples include cryptocurrencies for payments and businesses like Uber in place of his Jitney Transit. The streets are still public and these remain the source of near-constant conflict over who can use what, when, and how.
In Liberty Minecraft, everything is private, which reduces conflict. Turnstiles have been invented to pay for access. We even have something like Friedman’s Jitney Transit, but it is free and on demand. Not to mention, roads, roads, roads, and more roads.
Decentralize The City
Friedman observed that cities were too large to be representative, especially somewhere like New York City. In Friedman’s day, there were over 8 million residents with 18.2 million in the metropolitan area. Since 1970, the population of New York City is little changed. Friedman’s idea was to decentralize power by creating sub-cities. Each one would contain perhaps 100,000 people with its own mini-mayor. Each would govern with their own rules about police, education, and other areas of government. The idea was to have different rules, and ultimately private legal systems.
Incidentally, Liberty Minecraft is also the size of New York City. With a modestly sized population, we have had 1,500 visitors. There are about 50 land owners. Each and every owner is a mini-mayor. Provided they observe the rule and do not hack the server, within their property players are free to make and enforce any other rules they want. Sub-cities include New Stockholm, Valmur, Oak Hills, Transhumanistan, New Oslo, The Grand Bazaar, Emerald City, Cardona, Foxxtopia, and others.
Competing Protection Agencies
Friedman offers, with compelling examples, the idea that for-profit protection agencies will do a better job at a lower cost. In his example, Friedman’s TV is stolen. The thief uses a different protection service than Friedman, one that is also in the business of protecting persons and property. A run-in with another protection service looking to protect Friedman’s assets could become costly. Firms would turn to private arbitration to keep costs down. It is quite an elaborate example, and the whole book is filled with these.
There are between 30,000 and 50,000 Minecraft servers online right now. These offer a variety of protection services to as many as 200 million players. I am one of those server owners with a server and about 1,500 account holders. Property damage has occurred because of human error, server crashes, and file corruption. I create backups and work to restore property to owners because failing in that job will mean the end of Liberty Minecraft. In seconds, any player can find another Minecraft server. Within the server, private land owners have also offered protection services, and with varying results.
Explored and Unexplored
1. Private Arbitration
Friedman proposed a system of private arbitration which would eliminate the need for me alone to decide about banning players. As much as Liberty Minecraft is my private property, I love the idea of making contracts to use a mutually agreed and trusted party to arbitrate in the event of a contract dispute. In all probability, it would make my life easier because (per the contract) the arbiter would be paid to do the work. I might even be trusted on occasion and compensated accordingly. As a private stake holder, I would not be stuck with someone whom I did not choose. Working for profit would reduce costs and improve quality.
Currently, I ban people for hacking, for breaking the one rule, and for rejecting the rule. Fewer than 20 players are banned, and some of those are the same person on different accounts. As for player disputes, the players themselves mainly handle that part. With private arbitration it seems like we would have more win-win outcomes. I do not know how to offer that at scale, so we instead use instruments like smart contracts.
2. Credit Ratings for Arbiters
Credit ratings are Friedman’s second arm to achieve enforcement in arbitration. Arbitration firms would have a credit rating that anyone could check. In fact, credit ratings are the other side of the enforcement coin. Credit ratings are offered as an example of private arbitration where the one given credit is the arbiter and escrow.
This already happens when people are lent money and expected to repay at interest according to what is owed. What is owed to a lender is generally 100% plus interest. It is just like paying them their due following arbitration. It demonstrates that many people today can be reliable arbiters. Just look at their credit scores. A prospective arbiter with a low credit score has a history of neglecting to award payment in full to the proper owner.
3. Pollution: Tragedy of the Commons
Friedman recognized that pollution is a problem because some things are not property. Privatizing everything is the right first step, because then the owner decides how to economize. Nobody wants the value of their property to collapse, and that is true for air and oceans. In Liberty Minecraft, pollution is represented by server lag. If someone is making a lot of complicated things happen with cows or comparators, it can cause the server to lag. Our approach is unsophisticated. Often I check for problems to solve on the back end, or tell people if their property is causing a lot of lag. Gratefully players are usually cooperative, but it is thankless work.
We have a tragedy of the commons with respect to computational resource use. By my reading, it is against Mojang’s terms of use for me to impose selective computational costs on individuals. I think I would be shut down. For now, I think we are stuck with this kind of recurring performance issue because of socialization at the level of Minecraft’s terms of use. In the hopefully-not-to-distant future, games built on cryptographic ledgers will have computational costs and unconditional property, wiping the floor with Mojang’s silly nonsense and routing around arbitrary power in Minecraft.
4. The Constraint of Time
I economize even as I write, refusing to subsidize my writing budget with game-server donations. Under this constraint, I know the current market value of my writing. It is not worth much, but my goal today was modest: to demonstrate that games offer a way to explore Friedman’s wide range of ideas in a place very far away from you.
We could have a wonderful discussion about Friedman’s comments on private law and whether my one rule is valuable enough for its net benefits to outweigh its total costs. I might decide to explain that I am not a Utilitarian, and then try to split the difference with some talk about using a fee to compensate people who tolerate unfavorable rules. It would be difficult, fraught with pitfalls.
There is no time to discuss my investment in opensource projects as a common good. To approach Friedman’s proposition about marginally risky acts against non-consenters (like plane flights, or you know…3-headed monsters). Or what about a convincing principled argument for land as property? Unanswered questions are the wonderful dreams that haunt at least one ‘student’ of philosophy. I might not even be up to the task.
Like Friedman said: you write an article and say “if only I could write a book.” In writing that book you say, “if only I could write an encyclopedia.”
Special thanks to David D. Friedman for his appearance on Robert Murphy’s podcast, inspiring this rabbit hole.
References
- Friedman, David D. (1989). The Machinery of Freedom. 2nd ed., Open Court. p. 84.
- Friedman, p. 79.
nathan@libertyminecraft.com
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