Originally Posted by Mikebert

For the vast majority of the time humans have lived on Earth, they have lived in small egalitarian bands that lacked government. That is, ungoverned human societies are the norm for our species.

However, almost no humans live in ungoverned societies today. If the ungoverned society is superior to governance, how did governance ever get a foothold, much less completely replace, the tens of thousands of ungoverned societies that existed all over the world 10-15 thousand years ago?

An interesting question. I woulв comment that the pre-agricultural model simply did not provide enough excess resources for a parasitic class to develop to any significant extent without killing off its host. That's almost certainly the larger part of the answer to the second clause of the question, "Why now, and not then?"

As for, "Why now?" Likely it comes down to force inequalities. We find -- in the very broad -- that societies tend to be increasingly less authoritarian the more evenly distributed are the means of personal survival (and, underlined, defense). So what we may be seeing is an oscillation that occurred due to a lag between the growth of the ability of a society to feed a parasitic class and the growth of the society to keep itelf free from those who would become that class. After all, the governed society is most certainly not inferior from the standpoint of the governing class.
Since the dawn of agriculture, the strength of government swung from 'none' to 'total' and has in the past few hundred years (subject to smaller oscillations -- it's not like the system only has two parameters, after all...) moved back closer to the pole from which it started. Ultimately, though, "superior" and "inferior" run up against the only test that really matters -- does whatever is adopting the model survive or not. Reality will judge, just like it did with the trilobytes and the dinosaurs and the sharks and the cockroaches. A major concern is that the 'governed' system is necessarily less capable of responding appropriately (again, with regards to that one critical test) than a less-governed one.

That's one not-implausible five-minute conjecture (which has the virtue of resembling any number of ecological models). I'm sure there are others, attempting to explain in all manners of directions.

Originally Posted by Justin '77

An interesting question. I woulв comment that the pre-agricultural model simply did not provide enough excess resources for a parasitic class to develop to any significant extent without killing off its host. That's almost certainly the larger part of the answer to the second clause of the question, "Why now, and not then?"

The earliest agricutural communties were small and do not show evidence of class stratification. Early agriculturists already had to work harder to obtain their daily calories than hunter gatherers They would have to work even harder to generate surpluses. Why would anyone ever start to do that? Why would an already egalitarian society adopt a parasitic class in the first place?

As for, "Why now?" Likely it comes down to force inequalities. We find -- in the very broad -- that societies tend to be increasingly less authoritarian the more evenly distributed are the means of personal survival (and, underlined, defense). So what we may be seeing is an oscillation that occurred due to a lag between the growth of the ability of a society to feed a parasitic class and the growth of the society to keep itelf free from those who would become that class.

But in the beginning there were no force inequalities and the means of personal survival were evenly distributed. There would be no need for people to exert any effort at keeping themselves free of elites as there were none.

Elites did appear. There must have been a reason why they were allowed to exist.

Since the dawn of agriculture, the strength of government swung from 'none' to 'total'

What are you talking about? Governance has never disappeared.

Ultimately, though, "superior" and "inferior" run up against the only test that really matters -- does whatever is adopting the model survive or not. Reality will judge, just like it did with the trilobytes and the dinosaurs and the sharks and the cockroaches.

Yes indeed and it seems governance won the competition.

A major concern is that the 'governed' system is necessarily less capable of responding appropriately (again, with regards to that one critical test) than a less-governed one.

Then why did the governed systems survive while the old ungoverned model went extinct.

That's one not-implausible five-minute conjecture (which has the virtue of resembling any number of ecological models).

It doesn't address the central question of how governance first arose. It is beyond belief that a subset of an egalitarian community would be excused from the effort of providing subsistence by the rest of the community in exchange for nothing, which would be the case if they were true parasites.

There must have been something of value that this subset produced that persuaded the rest of the community to excuse them. Otherwise this would not happen, or if it happened once by fluke, the practice would quickly die out; it would not spread.

Originally Posted by Mikebert

Why would an already egalitarian society adopt a parasitic class in the first place?

Due to conquest by an outside society that became the parasitic class.

Originally Posted by Mikebert

Elites did appear. There must have been a reason why they were allowed to exist.

The alternative was death. This wasn't a bad deal, compared to what had come before. In pre-civilized societies, losing a war meant death for all post-pubescent men and post-child bearing women. Genocide was the norm until the agricultural age, at which point conquest became a reasonable strategy. This explains why conquered people's accepted their fate. It could have been worse.

Originally Posted by Mikebert

Then why did the governed systems survive while the old ungoverned model went extinct.

Because once one society defeats another, realizes that genocide isn't necessary and that their population can grow, then they are in competition to produce the largest and most effective fighting force. This requires a professional military class and from then on, you have a state. None of this is actually necessary for social complexity -- just necessary to defend that complex society from other complex societies.

Which also explains why there have been long cycles of centralization and decentralization as violent competition results in huge empires which then collapse into corruption and absurdity because there's no plausible "outside" for the state to defend against. Once the empire collapses, new polities form and the process starts anew.

Either that, or it's all the cats' fault.

Originally Posted by Kurt Horner

Either that, or it's all the cats' fault.

Fascinating.

Plausible. I'm governed by four of the furry parasites. And love them beyond all reason, though not as much as I love my grandchildren.

I had heard rumblings of the cats theory, but it's neat to see it all lain out.

Two items in this post. First, Carson has a new post up about growth that seems like it might be germane to Kurt and Mike's economics discussion. I'll beat back my nature and not excerpt it (it's not long, click through).

Second, in response to Mike (at least the items that Kurt didn't already get):

But in the beginning there were no force inequalities and the means of personal survival were evenly distributed. There would be no need for people to exert any effort at keeping themselves free of elites as there were none.

Yeah, right. Because particularly in a world where both obtaining the necessities of life and defending them and oneself was purely a matter of physical strength, everyone was totally equal...
Opposing that gross inequality, we can look to the idea behind the old saying about god making men, but Samuel Colt making them equal.

What are you talking about? Governance has never disappeared.

What are you talking about? My statement was about the waxing and waning of its strength (although governance in the context of this discussion has locally been escaped completely from time to time, too). The strength of governance has clearly been on the wane (again, with local eddies not changing the overall trend) for at least the last several hundred, if not thousand, years.

Yes indeed and it seems governance won the competition.

The race is over? We've reached heat-death and nobody told me?

Get real. The dinosaurs were much more clear-cut winners than was the model of a society under government. And as it turned out, they didn't have what it took, either. The governed-model had a decent run, as far as human timescales go, and probably still has a bit more to go on momentum alone. But again, the vector is clearly against it -- and has been since it became potentially more expensive for the parasite class to maintain its position than could be gained from that position.
As I mentioned above, it's a fairly straightforward ecological question.

Originally Posted by Kurt Horner

Due to conquest by an outside society that became the parasitic class.

This avoids the origin issue. Where did the elites in the conquering society come from? There is no concept of "conquest" amongst ungoverned egalitarian bands. When "wars" are fought the goal is to drive away or kill the opposing force, just as it is with chimpanzee "wars". So two ungoverned groups could not merge in this way.

Originally Posted by Mikebert

This avoids the origin issue. Where did the elites in the conquering society come from? There is no concept of "conquest" amongst ungoverned egalitarian bands. When "wars" are fought the goal is to drive away or kill the opposing force, just as it is with chimpanzee "wars". So two ungoverned groups could not merge in this way.

True. 'Conquest' implies a pre-existing governing structure to take over. What originally happened is much more accurately called 'enslavement' -- which is a condition that exists between two individuals. Chimpanzees (so far as I know) don't capture slaves...

Originally Posted by Justin '77

Yeah, right. Because particularly in a world where both obtaining the necessities of life and defending them and oneself was purely a matter of physical strength, everyone was totally equal.

Now you are being silly. Haven't you been talking about self organzation and that humans have a nature to cooperate? And now you revert back to 17th century conceptions of the state of nature. Hunter-gather societies have been observed and nothing like this is the rule. Big men tend to be entrepreneurial types, not bruisers. They tend to do well when stone age cultures come into contact with the modern world.

A strong man can be taken down by two or three normal opponents, particularly if they gain surprise. Surprise attacks with superior numbers is the normal mode of violence in such bands. What a would-be leader needs is lots of friends and few enemies, not personal strength. Dominant male types are always going to generate resentments amonst the rest of the males and so can never be leader. A strong man could be leader, but only if he doesn't behave like a strong man.

The idea that governance came from some strong man forcing people to do his will is nonsense.

My statement was about the waxing and waning of its strength (although governance in the context of this discussion has locally been escaped completely from time to time, too).

I am not sure what you are referring to. Can you give an example. I suspect we are not defining governance in the same way.

The dinosaurs were much more clear-cut winners than was the model of a society under government. And as it turned out, they didn't have what it took, either.

What do you mean they didn't have what it took? Are you implying that because the well-known dinosaur species went extinct they "lost" in some way? All species go extinct just as all men die. That doesn't mean the dinosaurs "line" ended, it continued on in birds.

I find it hard to believe that homo sapiens will not be extinct even 5000 years hence, much less millions of years. That doesn't mean that humans are a "failed species" but merely that our descendents will resemble us like birds resemble dinosaurs.

Originally Posted by Justin '77

True. 'Conquest' implies a pre-existing governing structure to take over. What originally happened is much more accurately called 'enslavement' -- which is a condition that exists between two individuals. Chimpanzees (so far as I know) don't capture slaves...

And neither do ungoverned bands. Slave is not a condition that exists between two individuals. Slave is a class of people. You cannot have slaves until you first have a class society, and that means governance comes before slavery.

Originally Posted by Justin '77

First, Carson has a new post up about growth that seems like it might be germane to Kurt and Mike's economics discussion.

I read this post. Carson says this:

For example, take the artifice of “limited liability” — a privilege bestowed upon corporations by state fiat. In a free market, the owners of an enterprise would shoulder 100% of any liability that enterprise might incur. In the state-regulated market, the owners’ liability is limited to only those assets actually invested in the enterprise itself.

One obvious effect of this state-bestowed privilege is that it reduces incentives for corporations to act responsibly, by artificially reducing the possible penalties for not doing so.

This statement certainly makes it sound like limited liability (a fairly recent invention of the late 19th century) made corporations less responsible than the companies that preceeded them. Consider the Dutch East India Company (VOC), one of the first, highly successful successful, large companies. They became successful by seizing control of their competitors' assets. As you can imagine, doing this created a lot of liability in the from of angry competitors. So they killed them, problem solved. Somehow I don't think this is the more responsible behavior that Carson has in mind. In one sense it is more responsible, the VOC took the responsibility of dealing with their liabilities themselves, and I supoose a modern day version of the VOC would simply kill off anyone who impedes their business, dealing responsibly with thier liabilities.

Carson makes a very imortant point here:

A secondary, less often noticed, effect is that it frees up capital — capital which, absent the privilege, might have been set aside by by its owners in a “rainy day liability” fund or used to purchase insurance against possible liabilities

He is right. The VOC, successful as it was in its day, was not very successful by modern standards. Because they had full liability for their actions they needed to spend a good deal of money on mercenaries (or bribes to potentates) and that cut into profits and eventually stopped growth altogether.

I'll have more later.

Originally Posted by Mikebert

And neither do ungoverned bands. Slave is not a condition that exists between two individuals. Slave is a class of people. You cannot have slaves until you first have a class society, and that means governance comes before slavery.

As a matter of fact, IIRC, ungoverned bands do and don't take slaves. What they do is kill the men and the killer gets to keep the dead man's womenfolk - wife, daughter, sister, or whatever. Whether the women can be called slaves is entirely a matter of chance and custom and whether there's a first wife around to make sure they stay subordinate.

They also take children and generally raise them as band members.

Originally Posted by Mikebert

This avoids the origin issue. Where did the elites in the conquering society come from? There is no concept of "conquest" amongst ungoverned egalitarian bands. When "wars" are fought the goal is to drive away or kill the opposing force, just as it is with chimpanzee "wars". So two ungoverned groups could not merge in this way.

The conquering society doesn't need to have an elite. They become the elite as a result of successful warfare. The state emerges when a war is fought and the victors do not behave in the typical genocidal fashion (described in the Grey Badger's post #864). This is accepted by the losers since slavery is usually preferable to death.

No benefits from the state are required to explain its origin, and its resilience since then only requires that lack of a state carries notable disadvantages (i.e. being attacked).

Originally Posted by Mikebert

Consider the Dutch East India Company (VOC), one of the first, highly successful successful, large companies.

The VOC was an extension of the Dutch government created specifically to cartelize an already existing system of trade. It was also created in response to the British adopting the same strategy. It seems like you would like to use this an example of a wild untamed "market" firm that came before limited liability -- but the VOC was about as "private" as the Federal Reserve Bank.

Originally Posted by Justin '77

I had heard rumblings of the cats theory, but it's neat to see it all lain out.

Two items in this post. First, Carson has a new post up about growth that seems like it might be germane to Kurt and Mike's economics discussion. I'll beat back my nature and not excerpt it (it's not long, click through).

Second, in response to Mike (at least the items that Kurt didn't already get):Yeah, right. Because particularly in a world where both obtaining the necessities of life and defending them and oneself was purely a matter of physical strength, everyone was totally equal...
Opposing that gross inequality, we can look to the idea behind the old saying about god making men, but Samuel Colt making them equal.What are you talking about? My statement was about the waxing and waning of its strength (although governance in the context of this discussion has locally been escaped completely from time to time, too). The strength of governance has clearly been on the wane (again, with local eddies not changing the overall trend) for at least the last several hundred, if not thousand, years.The race is over? We've reached heat-death and nobody told me?

Get real. The dinosaurs were much more clear-cut winners than was the model of a society under government. And as it turned out, they didn't have what it took, either. The governed-model had a decent run, as far as human timescales go, and probably still has a bit more to go on momentum alone. But again, the vector is clearly against it -- and has been since it became potentially more expensive for the parasite class to maintain its position than could be gained from that position.
As I mentioned above, it's a fairly straightforward ecological question.

Dinosaurs were very successful creatures. It's just that the aftermath of the asteroid impact wiped out all warm-blooded animals bigger than a cat. If their feathery, flying descendants are anything to go by they certainly had more complex, well-developed cardio-respiratory systems than us mammals, do.

Originally Posted by Odin

Dinosaurs were very successful creatures. It's just that the aftermath of the asteroid impact wiped out all warm-blooded animals bigger than a cat. If their feathery, flying descendants are anything to go by they certainly had more complex, well-developed cardio-respiratory systems than us mammals, do.

They were temporarily successful, but ultimately their line disappeared due to an inability to adapt. What's left of them in birds and the occasional throwback are actually the exceptions that prove the case -- that dinosaurs as a class ultimately failed the test. The larger group of 'warm-blooded critters' seems to be a fairly successful paradigm, but the 'dinosaur' experiment just didn't work out.

Trying to blame it on a black swan is missing the point. Black swans happen; a successful paradigm, therefore, is one that can accommodate them. We have what -- in our, granted, biased point of view -- appears to be an advantage in that we can try to imagine events black swans before they come and try to map out plans to handle them before they are needed. In absence of black swans, it represents a waste of effort, but when (not if, mind, but when) the unforseeable happens, they very well might be the best opportunity we have for handling it.

Again, the ecological model -- a monoculture is a very robust model so long as nothing changes. But chaos (at least, the appearance from a very broad perspective) and flexibility, though they may not cause a system to thrive as well during constant-state conditions, are the key to it being able to handle change.
Bringing it back to politics is fairly easy, since the ecological model scales down to at least the large-molecular-chain model in at least some degree, and up as far as we can see. In fact, the higer-order the system, the more fragile it is, and therefore the more necessary is flexibility and reactivity-to-environment to its continued success.

I'll suggest this:

Hierarchical class distinctions emerge when a society develops surpluses large enough to require community involvement to manage and defend from, say, brigands who would try, say, to steal the stored surplus grain.

Now, management and defense imply managers and deferders, that is, bureaucracy and military. At the start there was not much in the way of specialization, but as such societies became larger and more populous the tendency toward specialization lead to specialized jobs involving management and defense. The bureaucratic function more often than not fell on the shoulders of the priests and the millitary function would be done by the local tough guys. And of course human nature being what it is these two groups inevitably found ways to use more of the surpluses for their own needs than was fair, as well as to sometimes use their influence to help relatives and children get equally cushy positions, and then finding rationalizations to justify such behavior.

The jump to state-scale organization and civilization was initially triggered by the need for communities to pool their surpluses into a big surplus that could be used for large-scale public works, like irrigation

Originally Posted by Odin

I'll suggest this:

Hierarchical class distinctions emerge when a society develops surpluses large enough to require community involvement to manage and defend from, say, brigands who would try, say, to steal the stored surplus grain.

A reasonable hypothesis. The problem is, what you described (the 'security guard' model) is not a model of governance -- rather, it is merely a division-of-labor development. Those who are able to specialize as security forces trade that for their livelihood.

The difference between that and governance is quite easily visible -- you can fire a security guard (or even the security company), or attempt to negotiate a better deal with them or with a competitor. But a government is not something that was meaningfully fireable in its early stages (that's actually a pretty recent development in the history of the governed model).
So it would appear that, in places where the 'security guard' model took root, the rise of government still followed a 'conquest' of sorts -- just a conquest from within, rather than from outside. The once freely-contracted protectors, largely due to the fact that they were stronger than the rest of the group (otherwise they wouldn't have been protectors) over time simply stopped behaving as peers of their society and started behaving as rulers. And this worked for them because, who was going to stop them? (Actually, I'm sure that happened on many occasions, too. But realistically, people are willing to put up with a lot of crap, rather than taking risks with themselves and their families. And even if three or four normal guys can bring down one big guy, are you willing to be the one out of the four that goes down with him? Those aren't very good odds...)

Originally Posted by Kurt Horner

The VOC was an extension of the Dutch government created specifically to cartelize an already existing system of trade.

The concept of cartel applies to a later era, it would be pretty meaningless in the early 17th century and before.

It seems like you would like to use this an example of a wild untamed "market" firm that came before limited liability -- but the VOC was about as "private" as the Federal Reserve Bank.

There was little difference between "public" and "private" in those days, it was mostly private. "Government" revenues went into the Privy purse, taxes paid by the Monarch's subjects were the personal property of Monarch.

A peasant or businessman did not, in theory, own his land or business. Everything was owned by God. Humans were just stewards, who held their property in fief, ultimately from God. As God's representative on Earth, the monarch was the ultimate feudal lord. Centuries earlier merchants had arranged for their feudal duties to be paid in money rather than their personal service. By the 15th century this practice was universal, money was paid (taxes) to discharge feudal obligations.

Now the Netherlands were part of the Duchy of Burgundy. Spanish King and Holy Roman Emperor Charles V inherited the Netherlands from his grandfather Maximillian who got them when he married Mary of Burgundy in 1477. He left them to his son Phillip II, who lost them when the Dutch revolted in the late 1560's. Once they won their freedom the Dutch were in a quandry. They were a piece of a duchy, a collection of minor nobles and merchant-owned free towns that had united to fight the Spanish.

A deal was struck between the merchants and the nobles. A Dutch "government" was formed which had a King who came from the nobility. The government operated institutions, such as the military, law courts and seaports that served the interests of the landed nobility and merchants. It was operated in a business-like fashion for the benefit of its owners: the nobility and merchants. It wasn't a business of course because it didn't earn a profit, it was more of a service organization. Since the merchants were part owners of the government, the government didn't get to tell the merchants what to do. For example, when the Dutch state was at war, Dutch traders would trade with the enemy if they wished. Anywhere else that would be treason, but not for the Dutch.

So to say that the VOC was an extension of the Dutch government doesn't mean what you imply it does. The Dutch republic in early modern times is probably the closest thing to a capitalist free market society that has ever happened in the real world.

Originally Posted by Kurt Horner

The conquering society doesn't need to have an elite. They become the elite as a result of successful warfare.

You need to have a concept of elite or slave before you can have either.

"Warfare" as practiced by hunter gather societies mostly involves killing or driving off the other group because there aren't enough quality resources for both of you. Keeping all those mouths around sort of defeats the whole purpose. Only after governed societies appeared, when war was conducted for the benefit of the elite, would conquest or slavery be an option.

No benefits from the state are required to explain its origin

Well you haven't given a plausible explanation for how governance that confers no benefits could have arisen from ungoverned egalitarian societies.

Originally Posted by Mikebert

So to say that the VOC was an extension of the Dutch government doesn't mean what you imply it does. The Dutch republic in early modern times is probably the closest thing to a capitalist free market society that has ever happened in the real world.

The Dutch Republic was certainly one of the most advanced societies of its time. If one was to pick a place in 17th century Europe to live, the Netherlands would have been your best option. That being said, whether their government was captured by merchant interests rather than landed interests doesn't really change the fact that this was a government and that the VOC was created by that government.

Goldman Sachs played a large role in the banking bailout. Private interests clearly control the United States government and have created a set of rules for their benefit. By your argument above, the TARP program is a "free market."

The appropriate distinction is, did the VOC arise from free exchange or from the use of force? The latter is obviously the case. This system is appropriate to describe as capitalist, but it is not appropriate to call it a free market. All land was privately owned in the middle ages, but describing feudalism as a free market in land is absurd.

You seem to be under the impression that the crucial quality of a market is private ownership. The real crucial factor is freedom of entry. A privatized public service is not a market. A monopoly backed up by force (like the VOC) is not a market.

Originally Posted by Mikebert

You need to have a concept of elite or slave before you can have either.

It's not like those notions are hard to invent. Surely you don't think that someone sold the concept of slavery to people? ("Hey guys wouldn't it be awesome if me and my friends lived in palaces and you guys toiled in the fields all day?")

Originally Posted by Mikebert

"Warfare" as practiced by hunter gather societies mostly involves killing or driving off the other group because there aren't enough quality resources for both of you. Keeping all those mouths around sort of defeats the whole purpose. Only after governed societies appeared, when war was conducted for the benefit of the elite, would conquest or slavery be an option.

You're reversing the order of events. Agriculture comes prior to the state. We know this because there are many examples of agricultural societies without states (as you noted above). At some point, post-agriculture, you get state formation. The style of warfare typical of pre-agricultural societies persisted for a time. But eventually they realized that genocide wasn't strictly necessary, especially when the conquered people were not themselves agricultural. The new land and labor could support the additional population, and potentially many more. So statist conquest was a positive development relative to primitive genocide.

The conquerors become more important than the conquered out of a sort-of Stockholm Syndrome on the part of the conquered. Realizing that they owe their lives to these conquerors, the conquered defer to them. The same social pressures that create the Big Man in pre-agricultural societies in turn generate the nobility of agricultural societies. As soon as these conquerors successfully fend off outside attackers, this perception is reinforced and the social stratification intensifies.

Originally Posted by Justin '77

So it would appear that, in places where the 'security guard' model took root, the rise of government still followed a 'conquest' of sorts -- just a conquest from within, rather than from outside. The once freely-contracted protectors, largely due to the fact that they were stronger than the rest of the group (otherwise they wouldn't have been protectors) over time simply stopped behaving as peers of their society and started behaving as rulers. And this worked for them because, who was going to stop them? (Actually, I'm sure that happened on many occasions, too. But realistically, people are willing to put up with a lot of crap, rather than taking risks with themselves and their families. And even if three or four normal guys can bring down one big guy, are you willing to be the one out of the four that goes down with him? Those aren't very good odds...)

Oh, I agree. Though the beginnings of such warrior aristocracies seem to have been gradual in many areas, not necessarily a sudden takeover. There seems to have been 2 paths. The first was the one taken in Mesopotamia and Egypt, professional soldiers gaining more and more power and influence, often in cahoots with the priesthood. The second was the one taken in less urbanized societies, like the Indo-European cultures, where a complex association of land ownership and ability to pay to arm oneself developed, those who hand more land could afford better arms.

Originally Posted by Kurt Horner

The appropriate distinction is, did the VOC arise from free exchange or from the use of force? The latter is obviously the case.

Yes the VOC used force against the Portuguese traders. Obviously the VOC believed that capturing the Portuguese trading posts would be of profit to the company, which it was. Of course this meant that the Portuguese would fight back, which they did. The VOC did not have the government bail them out (they owned the government). They beat the Portuguese themselves. What would you have, a government with a monopoly on force that forbids such behavior?

You are a most curious libertarian. Most I know are staunch supporters of the right to bear arms and use force when appropriate. In one discussion I had with Justin 77 he advocated personal ownership of nuclear weapons. Now if weapons had zero use, there would be no rational reason to have them, much less stridently advocate for having them. Obviously, although libertarians abhor the initiation of force, they believe that it is not unlikely that force will be initiated on them, and so they must be prepared to respond.

Now it is possible that Dutch traders initially tried to trade in Asian ports controlled by the Portuguese and had been rebuffed. After all the Dutch had traded peaceably in the Baltic Sea for centuries and had come to dominate the trade in that region solely through their technological prowess* and not any use of force. If this was the case, then the systematic capture of the Portuguese trading posts would be simply a response to a prior initiation of force, and so justified.

Now you are saying that after defeating the Portuguese traders the VOC should just let them back? Why should they?

How is what happened in the 17th century not free men acting freely? Where is the government colluding in favor of the Dutch?

This system is appropriate to describe as capitalist, but it is not appropriate to call it a free market.

Why not? The goods at both ends were exchanged freely. The only difference was the Europeans buying the stuff in Asia spoke Dutch instead of Portuguese. Back in Europe there was no change. Goods obtained from a variety of trading outfits with posts all over the world were exchanged in free competition with each other.

You seem to be under the impression that the crucial quality of a market is private ownership. The real crucial factor is freedom of entry. A privatized public service is not a market. A monopoly backed up by force (like the VOC) is not a market.

A market is a means for the exchange of goods. A free market is one where the market participants get to set prices based on some kind of bidding or auction through which a price at which supply meets demand is determined. There is no government distortion of the price.

I looked at a number of definitions for free market

I can see your definition in some of these, and mine in others.

I would submit that your concept of free market simply is not realistic. Why would self-interested firms grant access to markets they monopolize if they do have to? Are you arguing in favor of government mandated anti-trust actions?

I think the problem is you don't think that things like the VOC can arise in a libertarian world. Libertarianism is about freedom of action by private actors. The VOC was such a private actor. Yes they had connexions with the Dutch government, but the Dutch government had no power outside its borders. Even inside their borders the power of the Dutch government was being contested by their Spanish, their former overlords. So the Dutch government did not matter in Africa, India, the East India, or Brazil. So what the VOC accomplished they did on their own, as a private actor in a free world. Other actors were free to act too and they did. Dutch companies were not everywhere successful. The Dutch West Indies company, after considerable initial successes in Brazil, were largely driven back by Portuguese planters. In North America, the Dutch New York operation was taken over by British interests. Later on, the British East India company made serious inroads against the VOC in India. In the 19th century, the British became masters of India and claimed control over much of Africa, little remained of the Dutch positions.

A lot of early capitalist economic activity is mixed private and government. But since government was just another private actor (considering them a shareholder) and they did not have power beyond other economic actors, why is their involvement any different than a private firm?

I think your problem is you are attaching a modern vision of government to "governments" of the past. I suspect this is an Austrian thing. But the Austrians were dealing with a particular period, the late 19th century and early 20th century, when governments were bigger players than firms. Don't make the mistake of trying to apply this sort of thinking to the early modern period.

I focus on the early modern period because economic systems were simpler and easier to understand. For example the quantity theory of money was a cutting edge theory in the 16th century. It actually worked then.

************************************************** *****
*The development of the Dutch fluyt in the 1570's allowed Dutch merchants to ship 20% more cargo with the same labor costs.

Originally Posted by Mikebert

Yes the VOC used force against the Portuguese traders. Obviously the VOC believed that capturing the Portuguese trading posts would be of profit to the company, which it was . . . Now it is possible that Dutch traders initially tried to trade in Asian ports controlled by the Portuguese and had been rebuffed . . . then the systematic capture of the Portuguese trading posts would be simply a response to a prior initiation of force, and so justified.

This is sort of true, except it misses the fact that no one actually pursued a policy of free trade. All of the European powers acted to monopolize their East Indies ports. A Dutch port was for Dutch merchants only. Similarly for the Portuguese and the English.

Originally Posted by Mikebert

You are a most curious libertarian. Most I know are staunch supporters of the right to bear arms and use force when appropriate.

In defense, yes. Not as an aggressor.

Originally Posted by Mikebert

Now you are saying that after defeating the Portuguese traders the VOC should just let them back? Why should they?

It certainly makes sense that they wouldn't. However, actual Dutch attitudes were made clear when the English arrived and were also denied access, despite no state of war.

Originally Posted by Mikebert

How is what happened in the 17th century not free men acting freely? Where is the government colluding in favor of the Dutch?

The VOC controlled all trade in Dutch ports. What had been a diverse collection of Dutch merchants were now a series of subcontractors playing by the VOCs rules.

Originally Posted by Mikebert

A market is a means for the exchange of goods. A free market is one where the market participants get to set prices based on some kind of bidding or auction through which a price at which supply meets demand is determined. There is no government distortion of the price.

And you don't think the forcible exclusion of certain persons from the market based on nationality or unwillingness to join the state-chartered company had an effect on prices?

Originally Posted by Mikebert

I would submit that your concept of free market simply is not realistic. Why would self-interested firms grant access to markets they monopolize if they do have to?

Obviously, they wouldn't. The question is how the monopoly was obtained and is being maintained. If the natives tried to open new avenues of trade, local rulers would be overthrown and replaced with compliant ones. If independent merchants tried to cut side deals, they would be hunted by VOC warships as smugglers.

Originally Posted by Mikebert

I think the problem is you don't think that things like the VOC can arise in a libertarian world.

To make the argument that the VOC is a likely model for what sorts of firms would arise in a libertarian society, you would have to demonstrate that the environment of 17th century trade approximates what I advocate. Since it clearly doesn't, the VOC analogy is giant fleet of straw men.

Part of your confusion here is an assumption that a free market advocate must be pining for some better, vanished time when economic life was more free. Thus, refuting their position consists solely of showing how the past was undesirable.

Originally Posted by Mikebert

But since government was just another private actor (considering them a shareholder) and they did not have power beyond other economic actors, why is their involvement any different than a private firm? . . . I think your problem is you are attaching a modern vision of government to "governments" of the past.

Actually, I'm taking the opposite view -- that the government/private sphere dichotomy is illusory even in the modern era.