Sex and the social contract

Economic authoritarians of all stripes (these’d be Hayek’s “socialists of all parties”: I’m not singling out the Left here) love to argue that markets can only operate — or only operate at the levels they do — thanks to the complex (and expensive) framework of society.  Thus, since commerce is contingent on society, commercial agents owe society for the benefits they reap — and therefore taxation is just payment rather than theft.  You gotta pay for the apparatus of contract (and criminal) law, a strong military to keep the bad guys away, schools and colleges to educate your employees, and so on.  The tax man is just internalizing an external cost.  Right?

Megan McArdle wonders why we don’t apply the same reasoning to other private interactions that, like commerce, benefit from a well-ordered society:

You can only make money in the context of society, and so society has a right to regulate your transactions, and seize the proceeds, in any way that society sees fit.

And yet, the argument applies just as well to our sex lives or our political beliefs: they take place in the context of all sorts of government protections, from rape prosecutions to whistleblower laws.  Without markets and the government, the “anything between two consenting adults” morality to which the majority of the elite subscribes would be impossible; the closest substitute for these things is family, and families have a very clear, deep, and persistent interest in regulating the sexual behavior of their members.

Does this mean that the government (or our employers) may properly restrict our sexual behavior to that of which a majority of our neighbors approve? That bed you’re having sex in probably travelled on the interstate highway system, so standby for government inspection….

No?  The government can’t do that?  Then why is this argument supposed to be a telling blow against arguments for strong property rights and freedom from interference in voluntary economic transactions?

Of course, the government has regulated sexual behaviour based on what an apparent majority thinks is best for society.  Hence prohibitions on miscegenation, sodomy, polyphilia, and other acts between consenting adults — most of which have either fallen entirely out of favour or are rapidly doing so, as people have come to recognize that government has no business in the sex lives of its citizens, even if it enables them.

What does this say about regulation of commerce?

There are appropriate laws concerning sex — all of which prohibit aggression.  The same naturally applies to commerce.  But as Don Boudreaux notes (curiously without referencing the lex mercatoria), you don’t need a government to have laws.


6 Responses to “Sex and the social contract”

  1. April 19, 2011 at 20:06

    Buchanan made a similar argument in his grad Constitutional Political Economy course when I took it in 1999. Since income above that which would obtain in the state of nature can be viewed as a rent accruing to participation in the social nexus that depends on the state, taxation and redistribution to maintain that social nexus are entirely legitimate.

    I asked him whether we could similarly argue that because life expectancy is now so much longer than it was in the state of nature, if those extra years of life could also be viewed as a rent and legitimately subject to redistribution. He couldn’t explain why forced redistribution of surplus kidneys (from folks older than 35) was less legitimate than taxation, but he still opposed the former and supported the latter.

    • April 19, 2011 at 20:42

      Great story, there.

      So there are two objections to the assertion that benefits from society give the state a legitimate right to regulate and tax private action (commerce, sex, surviving to 40 with two working kidneys):

      1. McArdle’s point: regulation of some private action (sex) is (now seen as) abhorrent, so regulation of other private action (commerce) isn’t trivially legitimate and needs to be justified
      2. Boudreaux’s point: “rents” that accrue from society don’t necessarily accrue from a state; it could well be that the state is just a gang asserting a monopoly on social goods that would (or could) be provided privately
      • 3 aczarnowski
        April 20, 2011 at 07:33

        I prefer Boudreaux’s (based on your summary). While McArdle’s is correct, it puts the burden of defense on the liberty seekers. Boudreaux’s puts the burden on the rent seekers to prove the state is the reason for the surplus prosperity. At least it would if the majority of our fellow citizens weren’t idiots.

        BTW: I never would’ve recognized any of this during my undergrad. Why is it we give college profs so much credit for “outsmarting” people with zero real world experience (and probably a hangover)?

        • April 20, 2011 at 20:58

          Fortunately, we don’t have to choose between the two rebuttals. Boudreaux says: “It’s not obvious that the state is responsible for increased value from social network effects. You’ll have to prove that before you get in my face.” Most people who aren’t anarchocapitalists (or, amusingly, real-Marxist anarchosyndicalists) are likely to sputter indignantly for a few minutes and simply insist that state == society.

          For them, we have McArdle, who says: “Even if you’re right, it’s not obvious that society has any business taxing and regulating rents which accrue from network effects. You’ll have to explain why (thing you want to tax) is so different before you get in my face.”

          On your last point, you’ll be pleased to know that not even tenure committees give college profs much credit for teaching undergraduate courses.

          • 6 aczarnowski
            April 21, 2011 at 05:28

            This is going in the play book. I can start off in my standard social pigeon hole as the whack job libertarian (not really but context) by getting my state hate on. When the true believers start insisting, I can follow up with the sex angle.

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