While many anarcho-capitalists argue that the state in itself is a useless functionary that destroys the idea of voluntary exchange and the free market, as it is always open to corruption and is a benefactor to the few over the many, I believe that in the modern world the state does play some necessary functions within society.
Before I go onto what I believe is the function of a state within modern society, I will first go over what the state should not be doing and involving itself in. The short answer to that is practically nothing of what it currently does. If we look at the modern state, we see it has its fingers in far too many economic and social pies. The first main area the state should remove itself from is general economic activity i.e. anything involving free exchange between buyers, sellers and competitors. The regulation put upon these activities has done nothing but destroy competition and innovation and entrenched monopolies in many sectors of the economy, particularly areas such as energy (both production and distribution), agriculture (through massive subsidisation) and banking. In particular, banking has become an easy area for politicians and their lobbyists to formulate regulation that favours the preservation of dying banks at the expense of consumers and investors. Within banking, we also see much established regulation, such as the central bank being a lender of last resort through deposit insurance and allowing banks to operate fractional-reserve banking without proper notice to their customers, thus defrauding anybody who uses a bank. Following from this, the state should remove itself from the preservation of fiat money and stop allowing for an inflationary economy, which has seen the price of most goods go up significantly, in many cases above normal wage rates. This inflationary model has created the modern consumer, boom and bust economy in which we currently preside where people are discouraged from saving and investing and instead spend everything they have, which in terms of real wages relative to the general price of most goods is very little. On the social aspect of government involvement, the state should leave the realms of healthcare, education and policing. The states engagement in these areas has created monopolies which encourage state dominance and discourage a population that is questioning and sceptical. Within healthcare, it means that patients have to accept whatever care the state provides, irrelevant of quality and choice, and in the case of Ashya King’s parents, means that if you don’t accept this model, then violence will be used against you. This then leads onto the issue of policing, which under the government has become an organisation completely unaccountable and made the police focus not on a case by case model, but rather on statistics and where the most money can be squeezed from, thus why the police target traffic issues rather than private property violations. Within education, the state based curriculum has encouraged the idea of the happy consumer, where life dreams and ambitions aren’t as important as becoming a shill of an economic model that is becoming increasingly redundant, as has been predicted by Smith’s idea of “mental mutilation” and the Marxian concept of alienation. The state’s involvement in all these areas of life has destroyed any ability to question their legitimacy and made them another arm of big government, where you are told what to do and how to do it, and if you don’t like it then too bad. However, while these areas should be left to their own devices, I believe there are quarters of society that the government can have legitimate involvement in.
The main areas where the state can have legitimate involvement are in national defence, foreign policy, the rule of law and the preservation of that nation’s values. Within the vicinity of national defence, I believe the state does have an obligation to protect its citizens against potential threats, and while the modern military-industrial complex is bloated and entirely illegitimate, a well maintained national armed forces that has powers of intelligence would be entirely acceptable so long as it wasn’t used by the state to enforce its monopoly on the use of force. The best way to combat this I think would be to allow for private police and militias to form so as to protect private property against the power of big government. On foreign policy, the state again has an ability to direct our ability to trade internationally through basic free-trade agreements that open up our economy for international competition. However the current model of FTAs is redundant, as they have become a corporatist agreement that has allowed Western private companies to plunder developing economies. Instead, FTAs should be a basic agreement of at most a paragraph long, stating that said nations will open up their economies to competition and trade. Onto the rule of law, the state should be maintaining the legal power of contracts by ensuring via a court system that when one party breaks its obligations in a contract it is dealt with accordingly. However, the current state monopoly on what is effectively dispute resolution should be opened to private organisations so as to allow for competition and innovation. Within the realm of violent crime i.e. rape, murder and assault the state should continue to maintain courts to deal with these cases, as a purely private system would most likely favour the particular organisation that successfully prosecutes violent criminals, thus creating the rare example of a natural monopoly. Also, the state I believe best guarantees the modern jury system. Finally, the preservation of a nation’s cultural values is a function of the state, mainly via a constitution that sets out our rights and beliefs and encourages immigrants to a nation to integrate towards that nation’s values. Further, while in a free market it would be easily and factually assumed that there would be many organisations that’s aim is to help people by providing them healthcare, food or a basic income, in the short term this aim isn’t feasible, so a state-guaranteed basic income is the most effective welfare model that would stop individuals becoming destitute. Overall, these parts of modern society I believe are best serviced by the state as their function is almost essentially required by a basic monopoly, however within their modern formats, these areas are too overregulated and bloated.
The current version of government and the state is almost completely illegitimate and has a monopoly on force and violence that it readily exercises. If you don’t believe me, try not paying your taxes or finding an alternative to what the state provides. It’s massive involvement in huge swathes of the economy means that the advantages of free exchange and competition are stifled and in many cases eliminated, with state monopolisation in many sectors being the norm for the last century. For the state to be even remotely legitimate, it must remove itself wholesale from most areas of economic and social life, and focus itself upon the areas I’ve identified. For this to occur, nations need a basic constitution and bill of rights that sets out a nation’s values and rights, as well as constraining the state into certain areas of life (ideally the ones I’ve set out) and devolving the rest of these powers to local institutions and the individual.