The Counter-Economy Alternative

(Note: This essay originally appeared in Facets of Liberty: A Libertarian Primer, published in 1985)

By Samuel Edward Konkin III

Libertarianism has matured as a full theory in philosophical, historical and anti–political fields. Based on a simple premise of non–aggression and appropriate self–defense (or none), it has developed to the extent of offering a fairly satisfactory criticism of most current ideologies and of the issues of modern statism. Since 1969, a movement has grown to the size where considerable division of labor is practiced; educational institutions and activist groups are staffed; and numerous periodicals, large and small, internal and external, are published.

Soon after this movement burgeoned, a vexing question emerged: how does one get there from here? There is a society based on the libertarian principle; here is your present situation. Even if the populace was educated, and theory further developed and passed on through more education, to what immediate ends would the educated act? Action against the State was carried out in political terms, but action for a free society was undefined and, hence, unclear.

Alternatives first offered fell into two basic options: participate in the present anti–libertarian mechanisms of the State (politics), or withdraw from not only the State, but from statist society. The first option led to compromise and co–opt; the second led to coral–reef utopian pipe dreams and nomadic, “drop–out” wandering, and social irrelevance.

The answer, or at least an answer, was discovered in 1973. Modern libertarianism is particularly concerned with economics. An  understanding of the present economic system of various forms of State intervention—hereafter called Economics—was well developed, but the only practical alternative offered was not to act. Again, this limited analysis led to “working within the system” to restrain and reduce intervention—or to dodge it and await the millennium. The crucial problem was seen at this time as how to deal with (State) Economics and build a free society step by step.

Many people have successfully dealt with the Economics of the State for as long it has been around. During extreme, highly visible, state intervention—such as war–time controls, prohibitions, and sudden tax increases—black markets, “underground” economies, tax rebellions, and such emerged as popular movements. Investigation of these phenomena by advanced libertarians revealed startling and highly encouraging facts. Counter–Economics was the rule, not the exception, throughout the highly statist parts of the world. Nalevo production and trade in Russia, “black labor” and goods in Europe and Latin America, smuggling, tax evasion, and forbidden immigration thrived, and in many cases, contributed the majority of the “national products.”

Everywhere in relatively free North America, where the State intervened, the Counter–Economy responded. Trucking regulations generated evasions of speeding laws. Prohibition generated bootlegging, and drug controls generated dope–dealing. The State tried to control women’s bodies: counter–economy feminists marketed contraband contraceptives and an underground midwife industry. Growing taxation generated forty million (by government estimates) tax evaders, innovating new techniques and business practices. Confiscation of wealth through money inflation generated alternative, mainly illegal, forms of money and even counter–economy banking.

Obviously, these counter–economists were, and are, practicing free–marketeers. Surprisingly, few had any grasp of libertarian theory. Lacking such a full understanding, their activities were limited to single industries and they often oppressed others. Gun–runners would oppose dope dealers; tax rebels would denounce alien smugglers; feminists would recoil from gold–bugs and vice versa. Lacking a coherent ideology, the practicing counter–economists also warred internally, with ideas of “making their bundle and then going straight.” Thus, rather than expanding their numbers within their field and linking with other types of counter–economists for trade and social intercourse, they stayed “in the closet” until they could  “go straight.”

This “guilt trip,” or self–internalizing of statist pseudo-morality, prevents the Counter–Economy from replacing the Economy. As free–market (“Austrian”) economics tells us, the free–er market—much more efficient, productive, and especially, innovative—will easily triumph over the controlled market. All that is lacking is the market demand for that victory.

This, then, is the role suitable for the libertarian activist. He and she become the entrepreneurs of liberty—selling the libertarian explanation and moral defense of the Counter–Economy, and destroying the statist mystique. They will increase its size, first, by encouraging counter–economists to use their techniques in other activities and exchanges in their lives; second, by encouraging and training new entrepreneurs into the Counter–Economy; third, by developing and extending the communications and information flow both internally and interfacing externally; and, fourth, by convincing libertarians to enter the Counter–Economy and to “practice what they preach”—becoming convincing examples.

A fully integrated Counter-Economic Libertarian is an agorist. Theory meets practice and the mind–body dichotomy is resolved. Many libertarian alternatives have been offered, and more will and should be developed. But it’s hard to envision any libertarian strategy which does not at least include agorism and unleash the Counter–Economic alternative. For as the market goes Counter–Economic, the State starves for lack of taxes and wealth to control, and must die.

And is this not the Libertarian Revolution?

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Samuel Edward Konkin III (1947–2004) was editor of New Libertarian. He was a strong opponent of party politics, including the Libertarian Party. He wrote The New Libertarian Manifesto (Anarchosamisdat Press, 1980; second printing by Koman Publishing Co., 1983). He founded the Movement of the Libertarian Left and The Agorist Institute.

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