Yves here. As the summer wanes, we continue with our reprise of Andrew Dittmer’s series on libertarian thought, as a reminder of how we got where we are.
This post was first published on December 2, 2011
By Andrew Dittmer, who recently finished his PhD in mathematics at Harvard and is currently continuing work on his thesis topic. He also taught mathematics at a local elementary school. Andrew enjoys explaining the recent history of the financial sector to a popular audience.
Simulposted at The Distributist Review
This is the fourth installment of a six-part interview. For the previous parts, see Part 1, Part 2, and Part 3. Red indicates exact quotes from Hans-Hermann Hoppe’s 2001 book “Democracy: The God That Failed.”
ANDREW: The GLOs in your future libertarian society will be continuations of GLOs that exist now – basically large corporations and high net worth individuals. And the modern GLOs are continuations of GLOs that existed in the past.
CODE NAME CAIN: True – GLOs have a long and proud history.
ANDREW: In our society and in the past, both GLOs and regular governments have certain legal rights.
CNC: That’s right. But the legal rights of the governments are all completely illegitimate, whereas the legal rights of GLOs are all completely legitimate. That’s why I act morally when I hide my assets from the U.S. government.
ANDREW: How did it come to happen that the GLOs split into two kinds – the good non-government kind and the bad government kind?
CNC: As the libertarian Robert Nozick says, “Whatever arises from a just situation by just steps is itself just.” When rights were first created, the non-government GLOs legitimately claimed them. Since then, they’ve handed them down to their heirs and traded them among themselves. All of these transactions were strictly voluntary, and so all of the rights of modern GLOs are legitimate. On the other hand, governments seized all of their rights unjustly, and nothing that has happened since can transform their illegitimate rights into legitimate ones.
ANDREW: Maybe you should tell us the whole story.
CNC: Prepare to be surprised – mainstream sources have mutilated this history almost beyond recognition.
A long time ago, everybody lived in a state of liberty. Now, in any society that is not entirely primitive, a few men acquire elite status. Owing to superior achievements of wealth, wisdom, [or] bravery… some individuals come to possess “natural authority,” and their opinions and judgments enjoy widespread respect. Moreover, because of selective mating and marriage and the laws of civil and genetic inheritance, positions of natural authority are more likely than not passed on within a few noble families.
…. it is these very leaders of the natural elite who typically act as judges and peacemakers, often free of charge, out of a sense of obligation required and expected of a person of authority or even out of a principled concern for civil justice, as a privately produced “public” good. 
ANDREW: So the first security GLOs were noblemen, and they got their power because other people recognized their superior leadership qualities. These nobles were basically like little governments, except better because they were non-coercive and respected natural rights.
CNC: Exactly. The great philosopher John Locke understood this principle well. Some bonehead living in Locke’s time had said that governments had much more authority than GLOs… because they sometimes led men into battle. Locke retorted,
A Planter in the West Indies has more [than three hundred slaves in his household], and might, if he pleased… Muster them up and lead them out against the Indians, to seek Reparation upon any Injury received from them, and all this without [being] a Monarch…
In other words, GLOs, such as planters in the West Indies, had the same rights that governments did as far as war-making was concerned.
ANDREW: This is the first time you’ve mentioned governments, as opposed to non-government security GLOs. How do governments enter the picture?
CNC: In big cities, there end up being many different and independent security GLOs, all exercising their authority in complete harmony. For a government to arise it is necessary that one of these judges, arbitrators, or enforcement agencies succeed in establishing himself as a monopolist.  How is this possible? Why would other security GLOs ever allow one organization to obtain a monopoly and to usurp their own rightful powers?
Clearly the only way that this can happen is for one of the security GLOs to promise to be more than an impartial judge in matters relating to one’s own race, tribe, or clan . You see, in the state of nature a security GLO would treat all of its clients fairly, applying a uniform standard of justice. Governments come about when one security GLO pledges to enforce the law in a way that unfairly favors its own race or tribe – this unethical scheme allows such a GLO to seize power over its rivals. If racism stops being effective, the next resort of the rogue GLO is typically an appeal to the universal… feeling of envy and egalitarianism, i.e. to social class (the untouchables or the slaves versus the masters, the workers versus the capitalists, the poor versus the rich, etc.) .
ANDREW: Noblemen and masters were obeyed because their serfs and slaves recognized that some people were naturally superior to others – but then some GLOs came in and started messing everything up by appealing to racism and jealousy. These “rogue GLOs” are where governments come from.
CNC: That’s right. Now let me tell you about the history of territory GLOs. This part of the story is even more important – you see, libertarianism… is a systematic law code, derived by means of logical deduction from a single principle, the validity of which… cannot be disputed without falling prey to… contradictions…. This axiom is the ancient principle of original appropriation .
Now what does “original appropriation” mean? It means that you find something that no one else owns and you claim it. Whenever you claim rights in this way, it makes some people better off and no one worse off.
ANDREW: It does?
CNC: Well, it obviously makes you better off. At the same time, [your] action does not make anyone else worse off… Others could have appropriated those resources, too, if they had considered them valuable. Yet they… did not do so. Indeed, their failure to appropriate them demonstrates their preference for not appropriating them. Thus, they cannot possibly be said to have lost any utility as a result of [the] appropriation. 
ANDREW: Let me see if I understand the idea. Suppose that I find the only oasis in a desert and claim it as mine. Suppose some refugees flee into the desert and want to drink at my oasis. Can I threaten to gun them down if they come too close, unless they agree to become my effective slaves in a rights-respecting manner?
CNC: Of course – it’s your oasis.
ANDREW: Can you give me some real historical examples of how GLOs have justly appropriated rights?
CNC: [T]he English settlers [in] North America… demonstrated how… private property originated naturally through a person’s original appropriation… of previously unused land (wilderness). 
ANDREW: North America was uninhabited when the English settlers got there?
CNC: Opponents of libertarianism love saying “What about the Indians?” They get excited at the thought that libertarians will be forced to defend the property rights of dispossessed native peoples, which a lot of libertarians would rather not do. What they don’t realize is that John Locke solved this problem three hundred years ago. Locke explained that
…the Benefit Mankind receives from [an acre of land in England], is worth 5 [pounds], [whereas the benefit from an acre of land in America] possibly not worth a Penny, if all the Profit an Indian received from it were to be valued, and sold here; at least, I may truly say, not 1/1000. ‘Tis Labour then which puts the greatest part of Value upon Land, without which it would scarcely be worth any thing…
ANDREW: Wait. Did Locke just start to suggest that since the Indians did not do efficient agriculture, they did not really own the land?
CNC: Exactly. To properly claim land, you have to do real economic work on the land, and the Indians did not do that because they were too primitive. So Locke proved that that the Indians did not own the land. That meant the settlers could treat the land as if it was unclaimed.
ANDREW: Are you sure that’s what Locke meant? Locke is famous for defending liberty and natural rights.
CNC: Why are you surprised? In this example, Locke defended the liberty of settlers to claim unused land, and their natural right to keep that land once they had claimed it. And yes, I’m sure that’s what Locke meant – go read his second Treatise on Government.
ANDREW: Were the original territory GLOs in Europe also security GLOs?
CNC: Well, you can get wealthy by claiming unused land, and security GLOs were typically wealthy noblemen with long-established records of superior achievement, far-sightedness, and exemplary personal conduct . So there was probably a lot of overlap.
ANDREW: Didn’t a lot of people in Europe get land because their king or queen liked them and granted them land as a gift?
CNC: Well, you have to remember that the king or queen, being a government, did not own the land legitimately. Land can only be justly claimed by individuals or corporations, and so all “public” property is… the result of some form of expropriation .
ANDREW: So if you could prove that part of a particular organization’s wealth came from inheriting a royal land grant, would that wealth be illegitimate? Would you consider yourself justified in claiming that wealth as unowned, provided that no one could stop you?
CNC: Interesting question… But you see, sometimes we have to accept that bad things happened a long time ago, and it would be too confusing to try to correct the injustice. Sometimes you have to let bygones be bygones.
ANDREW: So governments that were established a long time ago might have rights that we have to respect, because it would be too confusing to correct the injustice?
CNC: No. The injustice done to GLOs by forcing them to accept man-made laws (“regulations”) and to pay taxes must never be forgotten. Every day that governments usurp rights, the debt owed to GLOs grows. The voice of that debt cries out from the ground for redress, and it will be heard.
ANDREW: I’m not sure why this question just popped into my mind – why did you choose “Cain” as your code name?
CNC: The fact that you have to ask that question shows that you have been misled by the conventional description of Cain as a thoughtless psychopath. That view is a caricature, spread by religious intellectuals subservient to modern democracies. A more measured appraisal of Cain leads to the conclusion that he was, in reality, a hero.
ANDREW: Maybe you’d like to explain further?
CNC: In the Cain and Abel story, Cain is a farmer, whereas Abel is a nomadic shepherd. Cain is therefore a representative of civilization and economic progress, while Abel represents a more primitive and superstitious form of society.
Cain and Abel go to make sacrifices to God. According to extra-biblical sources, Cain comes up with an idea for making the sacrifice process more efficient – instead of sacrificing productive agricultural goods, he will burn thorns and cow dung. The resulting fire and smoke will be just as impressive, and Cain will be able to preserve useful resources. Everyone will be better off.
Abel gets angry and says that God will not be pleased. That was obviously a coded threat to go tell their father Adam (the government) and to get Cain in trouble. If Cain hadn’t done something, his goods would soon have been confiscated for the sacrifice by governmental authority, i.e. coercion. Cain was forced to take action to protect his property.
ANDREW: So you see Cain as as the first strong defender of private property?
CNC: And as the original inventor of the concept of a Pareto improvement. But he paid a heavy price for his integrity – instead of recognizing that Cain had acted justly, his family kicked him out, destroyed his reputation, and forced him to live life as a trader, moving from place to place.
Maybe you can see now why I am proud to take “Cain” as my code name.
In part 5 of this interview, Code Name Cain argues that libertarians who favor a minimal government are deluded. CNC then goes on to explain how the inherent flaws of government compel honorable men to make what are sometimes difficult choices.
Whatever arises from a just situation by just steps is also just. Robert Nozick, Anarchy, State and Utopia, p. 151.
A Planter in the West Indies… John Locke, Two Treatises on Government, First Treatise, section 130.
Suppose that I find the only oasis in the desert and claim it as mine. This example is due to the libertarian Israel Kirzner, ‘Entrepreneurship, Entitlement, and Economic Justice,’ pp. 405-406 (cited by Widerquist, ibid.).
The Benefite Mankind receives from [an acre of land in England]… John Locke, Second Treatise, section 43.
According to extra-biblical sources… e.g., the Cornish “Creation of the World” by William Jordan, known from a 1611 manuscript. cf. also the Middle English Chester cycle, II, 537-540: “Hit weare pittye… those fayre eares for to brenne… thou of hit gett ought.”