The Silk Road Back to Leviathan? – ROBERT P. MURPHY

“The Silk Road might have started as a libertarian experiment,” writes Henry Farrell in Aeon magazine, “but it was doomed to end as a fiefdom run by pirate kings.”

Silk Road (anonymous marketplace)

Ross Ulbricht was recently convicted on seven charges related to being “Dread Pirate Roberts” (DPR), the mastermind behind Silk Road. The charges in his New York trial consisted of drug trafficking, money laundering, and other activities that most libertarians not only consider “victimless crimes” but, at least in the case of the Silk Road, possibly even a positive service to society.

Much more problematic for libertarians are the murder-for-hire plots, for which Ulbricht is facing charges in Baltimore. Indeed, George Washington University political science professor Henry Farrell wrote a provocative essay claiming that this aspect of the Silk Road case destroys the libertarian dream of justice without the state. Farrell’s conclusion is overblown: as disturbing as DPR’s downfall is, he handled himself far more ethically than the typical head of state.

Farrell’s charges

Farrell’s piece, “Dark Leviathan,” is well-crafted and knowledgeable; I can understand why Paul Krugman — no fan of libertarians, or of bitcoin, for that matter — described Farrell’s essay as “truly brilliant.” Farrell makes what seems to be a compelling case that the fall of Silk Road showcases the necessity of state law enforcement. As Farrell writes:

No entrepreneur of trust was more successful than the Texan Ross Ulbricht, who, under his “Dread Pirate Roberts” pseudonym, founded and ran the notorious Silk Road marketplace for drugs and other contraband. And no-one better exemplifies how the libertarian dream of freedom from the state turned sour.

Ulbricht built the Silk Road marketplace from nothing, pursuing both a political dream and his own self-interest. However, in making a market he found himself building a micro-state, with increasing levels of bureaucracy and rule-enforcement and, eventually, the threat of violence against the most dangerous rule-breakers. Trying to build Galt’s Gulch, he ended up reconstructing Hobbes’s Leviathan; he became the very thing he was trying to escape. But this should not have been a surprise.

In contrast to some writers who erect straw men out of libertarianism, Farrell has every right to view Silk Road as an experiment in stateless order. Farrell shows that Ulbricht himself explicitly cited Murray Rothbard:

When Ulbricht began to grow hallucinogenic mushrooms and sell them on the internet in 2010, he didn’t see himself either as a Mafioso or a state builder. Instead, it appears that he was driven by enthusiasm for the libertarian thinker Murray Rothbard. On his LinkedIn profile, Ulbricht declared his intention to use “economic theory as a means to abolish the use of coercion and aggression amongst mankind,” and to build an “economic simulation” that would let people see what it was like to live in a world without the “systemic use of force.”

Despite Ulbricht’s best intentions, his dream of a coercion-free environment was stymied when people began to rip off Silk Road’s users and to blackmail DPR (who the defense team claims was not Ulbricht by this point). As this fascinating yet disturbing message log shows, whoever DPR was, he definitely thought he was paying hundreds of thousands of dollars to have multiple people killed. This is why Farrell concludes that Ulbricht’s dream of freedom had deteriorated into a fiefdom.

Read the rest via The Silk Road Back to Leviathan? : The Freeman : Foundation for Economic Education.

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