Karl Widerquist’s “A Dilemma for Libertarianism”

Karl Widerquist’s “A Dilemma for Libertarianism” deserves to be better known. It exposes a contradiction in natural rights libertarianism, a set of principles held by those who seek to build a capitalist political philosophy on the basis of property rights. 

These principles typically include:

  • That individuals can legitimately own property if the property was justly appropriated from nature and was subsequently transferred voluntarily to the current owner.
  • That individuals can use their own property in any way that does not interfere with the personal or property rights of others.
  • That no person or state can interfere with the legitimate use of the property of others, including by state taxation or regulation.
  • That there is no affirmative obligation to promote the welfare of other people.

Widerquist points out that a state that infringes on the private property rights of its citizens, through taxation and regulation, is indistinguishable in this theory from an individual with a monopoly on property legitimately extracting concessions from others in exchange for the use of his property. The only difference between these scenarios is the terminology applied to them. The natural rights libertarian must therefore choose between accepting the legitimacy of powerful states and rejecting the classic formulation of robust individual property rights.

The King of Lanai: A Thought Experiment

To see the problem, consider a small, inhabited island called Lanai. (Widerquist calls his imaginary island “Britain” but that might cause confusion with the large, well-known island by the same name.) Initially, no person has ownership of any part of Lanai but, at some point, individuals start appropriating land and acquiring title to it. Soon enough, the entire island comes to be owned by some portion of the population. This title is absolute: There is no state, so each individual owner of land is the sovereign over it and their property rights are not subject to any limitations by others. 

Individual property owners trade their land for other land, for goods and services, or for money. Sometimes they bequeath or gift their land to others. Through legitimate conveyances, all of the land comes to be owned by one individual — let’s call him Larry.

Having achieved full land ownership, Larry institutes some terminological changes. He starts referring to himself as King Larry, to the other inhabitants of Lanai as his subjects, and to the island as his realm.

As the sovereign owner of the land, King Larry grants his subjects the right to limited ownership of land, which he calls “title.” Title is a partial interest in the land, which permits the owner to use it, rent it, sell it, or otherwise treat the land as fully owned by them, except that King Larry reserves what he calls “sovereign rights” — the right to “tax” the owner for the use of the land and to “regulate” its use. “Taxation” is what King Larry calls the annual rent that he charges in exchange for title to his land, and “regulation” is what he calls his right to place limits on the use of his land for the purpose of avoiding interference with the other subjects’ individual and property rights.

The result of all this is an arrangement that accords with the property rights of natural rights libertarianism but is effectively a monarchy that restricts the private property rights of everyone in the land except for the king. The taxation and regulation that offend libertarians are agreed to voluntarily by the subjects of the realm. The only “coercion” is King Larry’s threat to exclude the subject from access to any of the land in the kingdom. This is a legitimate exercise of his private property rights under libertarianism, as King Larry has no affirmative duty to sacrifice his property to prevent his subjects from dying of starvation or exposure. If any of his subjects helped themselves to King Larry’s land without his consent in order to avoid taxation and regulation, they would be violating his property rights. In many natural rights libertarian theories, they would be committing the cardinal sin of libertarianism: Aggression. 

Could King Larry’s subjects leave Lanai? Of course. This is a constitutional monarchy, where everyone has bodily autonomy. King Larry does not physically prevent anybody from leaving. As a practical matter, anybody can leave as long as they have somewhere to go and the means of getting there. Unfortunately, the habitable places on Earth tend to become legitimately owned by other people who prefer not to resettle refugees on their property, and have no obligation to do so. As in the actual world, states don’t tend to mind emigration but carefully regulate immigration. What’s more, King Larry could, if he wanted to, effectively prevent emigration within the rules of natural rights libertarianism. Lanai is remote enough that nobody could swim away, and King Larry could use his ownership of land to assert control over the use of materials derived from the land: Wood from its trees, metal from its mines, plastics from its oil, and water from its lakes. Without these materials, would-be emigrants could not build a boat capable of completing the journey to the nearest island that would have them. In this way, King Larry could practically achieve a libertarian dictatorship in accordance with the natural rights theory.

“But this is implausible!”

It could be objected that it is implausible for one individual to come to own all of the land on one island. I make two responses to this.

First, the objection is beside the point. This is a thought experiment to illustrate a problem with a set of philosophical principles. The philosophical problem persists even if it is unlikely to be encountered in the actual world for some reason outside the principles being examined.

Second, the problem for natural rights libertarianism does not require all the land to be owned by a single person. The thought experiment works equally well if 95% of the people own 100% of the land and establish a government over the 5%, or even if all the people on the island except one owned the land and coordinated their exploitation of the one remaining person. The fundamental problem, that it is possible in the name of libertarian property rights for some property owners to systematically limit other people’s property rights, exists whenever one or more people are able, through market power, to pressure others to license limited property rights from those with superior, sovereign rights. The King of Lanai example just uses a single monarch because it makes for a clearer and more appealing illustration.

What about the real world?

Natural rights libertarians, even if they agreed with the reasoning above, would probably still object to monarchies and other states that engage in taxation and regulation. After all, they would correctly point out, states in the real world do not arise out of just appropriation and transfer  — they arise out of violence. 

The problem is that the exact same thing is true of private property. Widerquist argues that those libertarians who defend the legitimacy of actually existing private property arrangements cannot, with any sort of consistency, dispute the legitimacy of actually existing governments.

While some libertarians would acknowledge the widespread illegitimacy of actual property arrangements, this appears to be a rare position. Most libertarians by and large accept people’s actual property holdings. This cannot be because property owners are able to trace their claims back to just original appropriations via voluntary transfer. The original claims and many subsequent steps are lost to history, and it is doubtful that there is much land on Earth whose property ownership could be justified in terms of appropriation and transfer. It is beyond doubt that a very substantial portion of the world’s land was acquired illegitimately through violence, given the pervasive and relatively recent history of global colonialism, imperialism, and war.

To prevent widespread illegitimacy of actual property holdings, many natural rights libertarians resort to rules that limit the ability of wrongfully dispossessed persons and their heirs to successfully challenge actually property holdings. For example, the approach adopted by Murray Rothbard, in Chapter 9 of The Ethics of Liberty, would allow illegitimately obtained possessions to revert to their original owner (or her heir) only if two conditions were met. First, it must be known that the current possessor is not rightfully in possession of the property. Second, it must be known who the legitimate owner (or her heir) is. Unless both of these conditions are met, the current possessor of the illegitimately obtained property is deemed to be its legitimate owner.

Given the history of violent takeover of land and property, these limits would make it difficult or impossible, as a practical matter, for the rightful owners of much of the world’s land to recover title based on the fact that the title was not established by just acquisition and just transfer, even where the illegitimacy of present holdings is a virtual certainty, because identifying the appropriate heirs of the people who were driven off the land is impossible with any degree of confidence. Hence, individuals illegitimately holding property are well-insulated from any consequences of the injustice of their holdings.

If these principles were applied consistently, actually existing states based on present holdings would be ratified just as well. King Larry is nothing more than an individual who happens to have a monopoly on property — his status as king is purely a matter of terminology. Natural rights libertarianism does not impose any special limitations on private monopolies and therefore could not impose any special limitations on states, unless it makes arbitrary distinctions based on terminology. Conversely, if natural rights libertarianism insisted on limiting property rights of states such as taxation and regulation, it would have to limit the property rights of wealthy individuals that allow them to extract money and limitations using their bargaining power as large-scale holders. 


One way that Widerquist formulates his conclusion is as follows: “Anarcho-capitalism exists; property ownership just happens to be dominated by about 200 firms called ‘governments’.” Another way he puts it is: “Natural rights libertarians have created an argument for property rights so strong that it protects a monarch’s right to own a nation.”

Where does that leave natural rights libertarians who want to create a private property libertarian utopia without a powerful state? Nothing prevents a group of them from getting together to create a state that is constitutionally prohibited from taxing or regulating anyone. But libertarian principles prevent them from doing so by infringing on the rights of any current state. As Widerquist puts it, “to create a libertarian state by taking away governments’ rights to tax and regulate property would violate the central axiom of the libertarian creed,” referring to the nonaggression principle, as formulated by Rothbard (emphasis in original). 

To create a libertarian utopia, natural rights libertarians would have to legitimately acquire not just title to the land, but the ultimate property right: Sovereignty. To do so, they would have to buy the sovereign rights from existing states. The fact that no group of libertarians has made such a purchase, as Widerquist points out, implies that living in a libertarian utopia is just not worth the cost.

Anarchy and Democracy
Fighting Fascism
Markets Not Capitalism
The Anatomy of Escape
Organization Theory