I’ve got a blog up over on the porch, check it out

I was invited to respond to Ed Stringham’s new book and lead essay on Cato Unbound. Here is a snippet.

The success of private governance depends on whether the previous actions of participants are easily identifiable. If so, cheaters will be avoided and cooperators will be interacted with again. However, there are a class of people for whom their previous actions are not easily identifiable.

Imagine you are an entrepreneur in the third world. You have started a business, but cannot grow it because you are capital constrained. Banks are unwilling to lend you money because the government cannot be trusted to recover capital if you are late during repayment. Because you are a new entrepreneur there is not enough information about your ability and willingness to repay loans for the bank to simply trust you.

If we ignore the government failure of enforcing the banking contract, it is also apparent that a private governance mechanism cannot solve this need. And a recent paper by David McKenzie suggests it is stronger than usually recognized.

McKenzie examines the results of a business competition in Nigeria where a randomized selection of 729 firms were given an average of $50,000. After three years he found, “Surveys tracking applicants over three years show that winning the business plan competition leads to greater firm entry, higher survival of existing businesses, higher profits and sales, and higher employment, including increases of over 20 percentage points in the likelihood of a firm having 10 or more workers. These effects appear to occur largely through the grants enabling firms to purchase more capital and hire more labor.”

The conversation will continue and I will likely add additional commentary here. After the conversation has ended I plan to summarize it here.

Recently I’ve become addicted to podcasts. I listen to them when I walk to and from work, when I’m cooking dinner, on the way to the bar, on the way to church — everywhere. The podcasts of Mike Duncan and Robin Pearson in particular –“History of Rome” and “History of Byzantium” — have been really enjoyable.

Now I want to try my own hand at it, with a podcast about the history of Virginia. Having gotten more confident doing radio over the past year, thanks to guest hosting gigs on the Mike Church Show, I think I can pull something like this off.

I still have much of the reading material from undergraduate history courses at W&M and Colonial Williamsburg saved as PDFs that I can dust off, and already have 30 or so books on various parts of Virginia history that I’ve begun collecting. However, this is quickly becoming expensive, and before I can begin I need to fill in the gaps, and especially gather more material pertaining to the Seventeenth Century.

So, I’d like to ask for your help. I’ve put together an Amazon wish list of books I’d like to have, all covering the colonial period (if all goes well, we’ll continue from there). If you sort the list by priority you will see that I’ve put those on Jamestown and the Seventeenth Century first, for obvious reasons. There’s also the Hornbook of Virginia History, a reference book that contains population figures, lists of who holds what office, and other information that will help guide my research and writing.

In terms of how the show will work, I will try to maintain a coherent narrative as much as possible, but I am committed to a couple of things: One, to have more interviews than is typical for this kind of podcast — having worked at Colonial Williamsburg’s public affairs office and corresponded with several colonial historians, it would be criminal of me not to highlight their work in their own words. And second, to not be afraid to focus on personal stories and other digressions that may or may not make good one-off episodes (think, for you podcast listeners, more Dan Carlin and less Mike Duncan).

There are several reasons why I think a more digressive approach is called for. First of all, Virginia is not an empire. In Augustus’ day, the Roman Empire contained more than 50 million people. Virginia wouldn’t pass a half-million until around the time the Declaration of Independence was signed. It’s a more human-scale story, in time and space, and less suited to grand narratives.

Second, Virginia is blessed with a long line of chroniclers with close connections to it, and they often approach their subject with palpable affection, first among them Samuel Kercheval, a correspondent of Thomas Jefferson, who wrote about the early settlement of the Shenendoah. I say “chroniclers,” because many were not academic historians. Many were newspapermen, like the legendary Virginius Dabney, who edited the Richmond Times-Dispatch for 33 years, or his one-time assistant Parke Rouse, Jr, who went on to run the publishing division of Colonial Williamsburg in 1953, or Virginian Pilot columnist Guy Friddell, author of the amusing ’60s tourist-baiting tract, What is it about Virginia? While this is probably not unique to Virginia, as an editor I’m fascinated by the way the state’s mythology and self-conception have so often been shaped by stately journalists with an unusual curiosity about history.

Other writers had different careers entirely, like the Jacobite nostalgist Edgar Erskine Hume, a highly-decorated Army officer and Chief Surgeon during the Korean War. While not neglecting current scholarship — there’s plenty on the list — I think all these people are worth getting into, along with homegrown mid-century academic historians like Philip Alexander Bruce and Raymond Dingledine.

These folks are all on the Amazon wish list, their works are largely out of print but not too expensive. With your help, I’ll be able to post the first episode in a couple of months.

The Freeman was kind enough to publish my piece on autonomous cities having the ability to solve the refugee crisis. I try to gently poke those discussing the idea, namely Jason Buzi and his Refugee Nation, and more importantly, Egyptian billionaire Naguib Sawiris and his attempt to buy a Greek island, to consider the governance of the city. Most of the discussion has focused on engineering and political difficulties. However, ultimately the success of such a project, namely, not simply being a giant refugee camp but a vibrant city, will depend on the legal system under which the city operates. I make this point more forcefully in the article.

When determining the success of a new country or city, the most important three things are laws, laws, and laws (with location being a distant fourth). Acquiring land, setting up tents, and giving away food and water will only create a giant refugee camp — not a city. To create a sustainable, livable city, where refugees want to move, there must be jobs, and for there to be jobs, there must be enterprise, and for there to be enterprise, the law must encourage it.

In practice what this means is that a refugee city must have economic freedom. Entrants must be free to own property, trade with each other, start businesses, and become productive citizens.

Paul Romer makes a similar point in a recent blog post of his, he writes.

To see what a real solution would look like, you need only remember three things:

1. It takes only a few cities, on very little land, to accommodate tens or hundreds of millions of people.

2. Building cities does not take charity. A city is worth far more than it costs to build.

3. To build a city, do not copy Field of Dreams. (“Build it and they will come.”) Copy Burning Man. (“Let them come, and they will build it.”)

How do we know that cities are worth more than they cost to build? Just look at the value of the land they sit on. Building a city on top converts land that used to be worth very little into land that is extremely valuable. The increase in the value of the land is the sign of the gains that can finance the cost of offering people a government that can create the conditions that offer residents safety, dignity, opportunity, hope.

Creating these conditions does require a local government; even at Burning Man, there is no libertarian free-for-all about where you can set up camp and where the public space will be. The local governing entity determines this before anyone shows up.

Unfortunately he stops short of directly advocating for Charter Cities to be used to stop the refugee crisis, though Alex Tabarrok did tweet at both him and Naguib Sawiris, so if I am feeling optimistic I will assume they are collaborating. I was also pleasantly surprised about his favorable reference to Burning Man, it seems Burner culture has permeated even high academia. Lastly, I feel a need to correct his use of libertarian. Libertarians are not against rules and institutions, they merely favor a specific kind of rules and institutions. Burning Man is libertarian to the extent it is an opt in culture with clearly defined rules that are agreed ex ante by participants.

Overall, I am pleased about the recent and new advocates for refugee cities. It shows the idea of free cities is gaining traction in unrelated circles, perhaps it is an idea whose time has come. That being said, I do hope they take seriously the problems of governance. I fear if they don’t, they risk setting up failure on a massive scale that would both have a high immediate human cost, the refugees, as well as a high future cost by reducing the likelihood of the initiation of similar projects.

One thing I did not discuss in The Freeman piece was the structure of governance. This is a little more difficult than what the laws should actually be (namely British Common Law). Should a refugee city be a democracy, private city, or some hybrid. The question is tricky because democracies have citizens. A refugee city, at least in its early years, wouldn’t have citizens in the same sense America does today, long time residents with a vested interest in the success of the city itself. What would the requirements to vote be, live there for 6 months, 1 year? Who would make the initial investments in a port and other basic public goods, would those investments be recouped, and if so, how?

My bias would be toward a private city, which would solve most of these questions, though in a somewhat unsatisfactory manner. Decision making authority would be clearly delineated, and a person like Naguib Sawiris does seem to have the best intentions of the refugees at heart and enough resources to invest in such a venture. But I doubt he would be willing to spend tens of millions of dollars on such a project as charity. The downside to a private city would be the potential for exploitation of those most in need of refuge. The primary advantage would be a much faster reaction time.

The other alternative would be the EU sponsoring such a city. Raising a few hundred million dollars to stem the refugee crisis would likely not be difficult. Further, they would be in a better position to bargain for economic freedom for the new city. The drawback is such an effort would probably be bogged down by politics and take several years to get off the ground when the worst of the crisis is over.

As usual, I would support both these efforts, though I lean toward the private city. Luckily, there are plenty of refugees for both approaches and the downside is relatively low. Hopefully these attempts can provide some alleviation of suffering and even hope for those who have been forced from their homes by war.

One of the primary critiques of private cities is how private police would act. Would police be responsive to powerful interests or would they act in favor of justice and dispute resolution. The Black Rock Rangers at Burning Man offer a glimpse as to how police might act in a private city.

Black Rock City is the name for the temporary city of 70,000 people in the Black Rock desert which houses Burning Man, an art festival, for lack of a better descriptor, for a week. Having recently returned from the event and having had numerous interactions with Rangers I realized they are a model for policing with lessons that can be applied more broadly.

First it is necessary to clarify what the Rangers do. They are closer to security guards than police (Edit Rangers prefer the term “non-confrontational community mediators”). They have no arresting power, in fact, the most power they have is to turn off the sound systems of noisy camps. A full list of their duties is here. In my experience, most of their time is spent helping to mediate disputes between neighboring camps and ensuring intoxicated people get home safely.

There are several reasons why working at Burning Man would be more stressful than other locations. First, many norms of interaction are different at Burning Man than the default world. There is a great deal of nudity, sexual expression (I was camped near the orgy dome), and hugging. As such, boundaries are different from the default world. This is a potentially risky situation as people can overstep boundaries that aren’t clearly established. For example, the numerous “Nudity is not consent” signs around Black Rock City suggest some people come to Burning Man believing that nudity is consent.

Burning Man also has a lot of drug and alcohol use. I would guess that per capita drug and alcohol use at Burning Man is comparable, if not greater, than Mardi Gras in New Orleans or St. Patrick’s day in Boston. The ubiquitous drug use means people are in a strange environment, with unusual rules for interactions, with many of them intoxicated. This could easily be a recipe for a great deal of conflict.

The Rangers are at least partially responsible for ensuring there is a minimal level of conflict.

Comparing the perceptions of the Rangers and police officers at Burning Man shows how, at least in limited circumstances, private police can be more responsive and helpful to community needs than traditional law enforcement.

Law enforcement at Burning Man consists of two groups, officers from the Bureau of Land Management, and officers from nearby towns. The perception of them is similar. They are seen as intruders in the city who primarily try to bust people for using illegal drugs. Visiting popular forums prior to Burning Man there are often guides on how to deal with police and reports on how aggressive they are pulling cars over. In fact, positive interactions with police are so rare than some people post their positive interactions just to counter the prevailing sentiment of negativity towards them.

Rangers, on the other hand, are overwhelmingly viewed in a positive light. During my first interaction with a Ranger, she clarified that she was not a cop and did not care if you were “tripping balls.” She stressed that Rangers were there to help and facilitate, not get people in trouble. Another rather intense interaction involved the leader of a camp and some Rangers. The leader of the camp had been placed next to a very loud sound stage, loud enough to shake the trailers in his camp. At around 3 in the morning the leader was very irate and implied to the Rangers that if they had been doing their jobs correctly they would have shut down the sound camp. The Rangers handled it very professionally, articulating the process by which a sound camp gets shut down. Given that it was loud, early in the morning, and everyone was tired, it is easy to imagine an escalation. However, the exchange ended with a hug and the leader saying he loved Rangers.

Ultimately it is hard to generalize from the Black Rock Rangers. Burning Man is a unique event, the Rangers are all volunteers for example. However, at the very least it shows that private security can be more responsive to local needs and form strong community bonds.

Edit: Former Ranger in the comments below pointed out two things that warrant mentioning. First, Rangers come from the community so they understand and respect community traditions. This is very important in formal policing as well. Second, Rangers do not like to be called security guards. I apologize for that. However, in my defense, like the rest of Burning Man, Rangers are difficult to classify in traditional terms as there are few comparable examples in the default world.