How Marxism fails

I do not hate Karl Marx and his political philosophy Marxism. I actually have a strong sympathy to his ideology to change the world to relinquish the national borders among individual citizens of the world and then to provide them with their ultimate sovereignty completely free from subordination to the traditional superstitious authorities. The rulers of the modern politics maintain the surplus value which represses the reward for majority individuals by introducing their complex economic and legal system. Individuals' sovereign is in crisis more than the past due to the intolerance of individuality in such a more collectivised world politics and modal code. More humans have lost their authentic loyal ethical principle in their daily life because they have chosen to obey and been secured by their superior authority at the sacrifice of their individual sovereignty. Marxism might be right to diagnose these illnesses; but, it seems to be the wrong method of prescription to tackle with these illnesses.

However, there are several objections to Marxism, and Marxism theoretically fails to explain about economics and ethics. First of all, Marx and his fellows had often described the modern world hegemonic political structure as Capitalism, which I strongly doubt about. Secondly, capitalists no longer control over the means of production in the modern world economy and politics. Finally, his loving united proletariat are more servile than he assumed, and his hating rich capitalists, individualistic nonconformists, and honest egoists are virtuous unlike he condemned.


Marxists affirm that, in the market economy, the rich minority individuals as known as the bourgeoisie monopolise the market with their power of controlling their means of productions. But then, what happens when the bourgeoisie start not being able to sell their offering products when majority become too poor to afford to purchase? Well, these bourgeoisie may invest their money to the financial market instead of investing to the good&service market. But, they also need to watch out and analyse the financial market trend not to lose their financial game. Some may argue that the bourgeoisie may protect their wealth by defending their property right of lands and the other assets. But, without a political stability where majority citizens are not too frustrated to be stabilised so they eventually need to find the way to redistribute their wealth for the communal security. The bourgeoisie may buy a huge militant force to form their own private militia to oppress their existing as well as potential enemy-proletariat to defend their monopolistic interest. But, the excess expenditure on the military and the low motivation of their subordinate proletariat impoverish the aggregate productivity of the economy they are living in. While lacking an abundant extractable resource from their economy, their state is always threatened by the invaders.

In order to strengthen these minority bourgeoisie, their political economy eventually enriches and motivate the rest majority proletariat, the majority citizens. Also, these ruling class bourgeoisie constantly monitor and compete against their rival bourgeoisie group to survive their games of the financial market and the foreign diplomacy backed by their military force, which are never be easy to keep winning. Furthermore, they may also want to remain this system enabling them to revenge when they lose. So, this implies that some proletariat may also have a chance to revenge to be promoted to become a member of the bourgeoisie. All in all, the ruling class individuals are also struggling in a competitive market system so that capitalism does not always deserve the capitalists. The market mechanism is abstract to explain but it certainly exists as something objective as Adam Smith described as the invisible hand of God. None has ever known what the next market trend in the future: Only what they may do to survive to thrive is to analyse how individuals' behavour and mind and the surrounding natural environment remain and change.


When the distribution flow and the overall economic activity are stagnated, a more visible and collective political force is affecting to stratify this economic and political structure than what Marx assumed. Neo-Marxists admit that capitalists are more proletarised than the past; this means that many traditional capitalists have lost their control over their capital because of the rise of two new capitalist classes called transnational entrepreneurs and national bureaucrats. Transnational entrepreneurs take advantage of this globalised world politics to gain the wider scale monopolistic power. National bureaucrats take advantage of their regulatory power and their authority of the government economic intervention. The name value of transnational entrepreneurs and the charisma of elite bureaucrats of a nation maintain their authority which is powerful and influential enough to enable them to accumulate their capital and its means of production.

Money is an intermediary of exchange: Money follows into where the exchangeable quantity and quality are located. The power of gathering money of the previously mentioned two ruling class groups is their authority to authorise what and where are legitimately exchangeable. This legitimacy authorised by their new authoritarianism is the means of their production of their capital to maintain their wealth and political power. So, only earning a huge amount of money itself to own a huge amount of capital does not enable individuals to have an authority to control over capital and its means of production.

Nevertheless, these new ruling class also do not have the full control of their means of production enough to prevent the pressure from the market force. Despite the significantly huge influential power in the market, these transnational entrepreneurs also need to constantly inject their own resource investments into analysing the current market mechanism and trend enough to maintain their wealth and preventing their potential predators against their dominance. National bureaucrats also need to constantly take enough attention to their resource allocation of the public sectors to optimise the level of taxation and regulation. The excess regulation causes the stagnation in the overall national economy, the extractable resources for these bureaucrats, and the loyalty of their fellow individual citizens to the national bureaucracy. Overall, these ruling class are always under the pressure of various external forces threatening their dominance, and the controlling capital and the means of production is not a permanent political power of reign.

So then, which human individuals control over capital and its means of production? The answer should be that none actually holds the ultimate economic and political power to maintain their dominance. Under the modern structured politics, even the ruling class individuals are constantly under the pressure of maintaining their status-quo a nation and/or a transnational institute. All of them live to survive as the cogwheel parts of their belonging institute. As they are already integrated into the structure, they unintentionally keep serving for their non-human machine-like structure in order to keep themselves surviving in it. In order to escape from this structure, the member individuals will be expected to become considerably brave and somehow deviant enough to challenge and escape from their accustomed modern structure of economy and politics.



Marxists put emphasis on the diversification of power enabling the majority citizens called the proletariat to replace the current ruling class minority with the proletariat majority rule. The old types of Marxists insist on persecution against the ruling class of the current status-quo as their revenge against the exploitation for a long time. Neo-Marxists insist less on what this old ideology but they still affirm to replace the ruling class with the proletariat rule by the diversification process. All Marxists agree to hate the minority rich for the cause of the proletariat. Furthermore, the proletariat class individuals not agreeing with Marxist cause are highly humiliated by Marxists as traitors, uneducated, and/or whores of the ruling class. Marxists claim for a strong altruism and devalue egoism to forcibly encourage citizens to unite. By contrast, there is always a question about why the rich individuals are evil enough to be hated and why all the majority citizens need to keep feeling miserable with their daily life.

These proletariat are frustrated due to their lack of satisfaction caused by the low reward for their high effort in their daily life. Marxists argue that this is a productive motive to challenge against the status-quo to diversify the ruling power to provide the unsatisfied proletariat with their right to improve their life. Marxists tend to blindly assume that all the privileged rich are selfish and brutal enough to keep exploiting the majority citizens to accumulate their wealth and political power furthermore. However, this has been questioned by the classical Liberalists from the British classical economics.

The following graph simulates the correlation between income and happiness=utility. An extra-income gain makes individuals significantly happy when their income level is lower than the certain point meanwhile its marginal rise of happiness=utility diminishes after exceeding this point.

In this graph, the income boundary is divided into this certain point where the marginal utility starts diminishing as the extra income gain increases. As shown in this graph, the marginal utility based on the income gain is higher than the marginal income at the relatively lower income level. The area chat shows the imaginary population distribution assuming the 10% rich individuals enjoy their "high income enough to be happy enough" and the rest 90% enjoy "extra income gains" more than the 10% rich.

The remarkable British classical economists such as Adam Smith and Alfred Marshall argue that these rich individuals tend to become altruistic because their own personal ego is already satisfied under the market economy described as capitalism by Marxism. The market economy is the first political economic system which provides individuals with the opportunity to accumulate their wealth so massively that it is not impossible to fulfill their egoistic interests. Furthermore, the market economy is a magical system where individuals' egoism turns to be an altruism because they exchange for their demanding reward for the others' needs. Then, rich individuals start redistributing their wealth voluntarily without relying on the government involuntary force in order to acquire their heroic honour. In addition, the rich individuals could not become rich without injecting enough efforts and using their wisdom due to the constantly competitive market economy. So, they have more experiences, knowledge, and wisdom to run big projects which the low income citizens have seldom had the opportunity of. Therefore, it is worse off to remain these rich individuals thrive rather than defeating them by the political power diversification.

At the same time, Marshall was afraid of the proletariat suddenly taking over the political power by replacing their hating rich with their sudden diversification. Even though these proletariat started doing good for all at the beginning after the diversification process, it is suspected to be the case that these proletariat violating the system to deserve for themselves. Marxism simply implies replacing the bureaucracy of the old regime with the bureaucracy hijacked by the Marxist proletariat coup. As the proletariat coup have been frustrated due to their lack of the marginal utility, they are more eager to cling to their irrational egoism by violating the politics. These bureaucrats of the proletariat coup seem to be too vulgar to maintain their rationality after suddenly acquiring such a monopolistic power of capital explained in the aforementioned paragraph.

Moreover, Marxists are too accustomed with despising egoism so persistently that they are hardly enable to admit the ego of others. They often force the others to deserve them and their revolutionary ideal to prop up their altruistic political structure. Unlike the capitalist regime which does not intervene to the others' business and personal egoism, Marxists tend to be paranoid about other individuals. The market economy, capitalism, accepts or even encourages egoism as a form of individuals' natural need and desire meanwhile Marxism and majority forms of socialism do not. Marxism and the other form of socialism regard highly of the collective effort to achieve their ultimate goal with the altruism. They may not directly force but they will indirectly force the others to follow their altruistic command by treating those opposing parties as uneducated and/or misguided.


Soren Kierkegaard said that Marxists and all the modern idealists are unhappy individuals because they will never be content enough to be happy in their daily life. They are always in a day dream of being better in their anticipating future, and then devalue their inevitable past experiences and memories and neglect what they have already acquired and achieved at the present moment. Unhappy individuals tend to be convinced to Marxism and all the modern idealism meanwhile the other individuals who are reasonably happy in their life are not convinced. Marxists may think these already reasonably happy ones are uneducated and/or misguided so that Marxists often preach these general public with their ideology to "help" them to overcome from the false-consciousness imprinted by the status-quo. Nevertheless, these preached one may feel this is not help; it is simply an annoyance.

Monopsony caused by the excess government regulation

There is a new terminology invented for expressing the phenomenon that the buyers have a strong power for controlling the price and the quantity of goods and services enough to reduce the price under the market equilibrium value. This is called "monopsony".


The monopsony is suspected to occur when the labour market flow is stagnated, employers are excessively risk averse, and employees have little opportunity of changing their job with their free will due to the previously expressed causes. This situation provides employers with the excess power in the labour market enough to control over the price and the quantity for their favour.

*** Past and Present: Emerging Problem of the Relative Deprivation ***

In the past, the efficiency wage was high enough to prevent the absolute poverty when the supply of minimum necessities was more scares. So, the equilibrium wage was supposed to be not higher than the efficiency wage then. By contrast, due to the increased world market competition and the dramatic improvement of productivity supplied, the gap between the minimum wage enough to prevent the absolute poverty and the wage enabling individuals enjoy their average cultural living standard has become widened. Therefore, the relative deprivation caused by this dissatisfaction emerges.

This tension of increasing this dis-function caused by the increasing relative deprivation implies that the public sector cost will be increasing to tackle with increasing cases of crime and deviance. So, the simple regulation of wage floor preventing the excess wage decline can be more efficiently reduce the cost raised by the increasing dis-function caused by the relative deprivation than increasing the budged for police force and the overall cost covered for public security and insurance. The following explains about why the current market is difficult to discourage the lowering wage and to stimulate the meritocratic labour market flow.

*** Marxist Explanation Fails: Rise of Government Bureaucracy ***

The menu cost of employees changing their job has become dramatically higher due to the more bind employment contracts and more specialised labour market requirements than the past. Majority of job markets nowadays demand more precise job skill sets requiring a long term training to acquire. Also, each employing firm has become demanding its employees to learn and adapt to its own custom which is notably different from the other firm even in an identical industrial field.

The menu cost of employers examining their employees has also become dramatically higher due to the more complex labour contract laws and regulations imposed by government. Despite the old Marxist hypothesis, majority of firm owners have lost their power of controlling their means of production fulfilling their interests. Those who have a control over means of production are government bureaucrats whose power is growing due to the expanding government power over economy and a few super wealthy individuals whose wealth is inherited or obtained through political bribery in the current modern world. Employers, firm owners, and relatively wealthy individuals are taxed, regulated, and highly monitored by government and their peers.

Government attempt to maintain the static labour market flow. The tax collection scheme by government has more complex, and government have required more certain and detailed population census in a turmoil of the current modern day world politics. So, government tend to want to avoid the frequent need of regular employment and income surveillance required. When individuals frequently change their job and change their wage often, government are more required to spend time and resource to survey these individuals. Therefore, government attempt to keep the labour market more static in order to avoid the frequent employment and income surveillance.

*** Perpetuation of both Socialism and Misemployment ***

Socialist labourers form their trade union (labour union) to increase their wage above the market equilibrium, but their excess wage is confiscated as their union membership fee. So, the leading members of their union then exploit their share of wage for their own interest. Then, the rest majority can keep as same as or less than the market equilibrium rate. The productivity of their belonging firm is significantly lowered because of the excessively labour cost compared to the labour productivity. This infers that the economic system had better offer minimum wage before these socialists start making excuse to prepare for their union intervention.

This situation of monopsony in the mainstream market also perpetuates the misemployment. The misemployment means that individuals are employed under unhappy, unproductive, and/or criminal situations as following examples. Some individuals need to, although they do not want to, play the fool by a wearing funny costume for a street advertisement. Some individuals may work in a casino perpetuating gambling which tends to be considered as unproductive for both individuals' own household economy and the aggregate economic environment if this market share expands excessively. Mafia, a group of the main players in the underground economy, gains the higher chance of recruiting new members and its exploitable human resources as the competent potential human resources are expelled from the employment opportunity in the overground economy. Because these employment forms are far more labour intensive, the monopsony is far more likely to be prevented in these misemployment market than the healthy/productive employment counterpart. Therefore, it implies that the misemployment market tends to offer a higher wage than the counterpart under the monopsonic situation so that more labour forces are flowing into the misemployment market, which reduces the sum of individuals' utility even though the misemployment market may have increased the overall employment rate in an economy.

.

A Critique of Anti-Trust Law and Natural Right Ethics

1. What economics is
In ethics, there has been a long debate to determine whether norms and values of action or the consequence of action is put priority on over the counterpart. Economics is the subject focusing upon the consequence i.e. Economics is a consequentialist philosophy. The mainstream economics puts emphasis on the positive statement firmly indicating what is, was, or will be caused, done, or happening instead of the normative statement indicating what “ought to” be done. Moral philosophy and psychology put emphasis on the normative statement because their interest is effect of human-individuals’ mind apart from their surrounding physical environment.

As economics is the subject to analyse causes and effects of human-individuals’ actions creating their surrounding physical environment. Even though the normative of their actions may become a means of the positive consequence of their actions, it is not always true because the intention of action does not always induce an initially intended consequence. So, realistic observations of outcomes induced by a particular action in consequence are eventually more practical than the meaning of these actions to know what should be done. Then, the logics developed from these observations implies the practical method to be done to induce a desired/planned outcome in consequence.


This consequentialist characteristics of economics is retained from the father of economics Adam Smith who is strongly influenced by Scottish culture of Legal Positivism, the school of law philosophy based on explicitly defined codes of actions designed to induce the desired consequence. Adam Smith was also a strong influence under his senior fellow David Hume, the remarkable Scottish enlightenment philosopher who was sceptical about any universal norm and value of actions because he claimed that morality defining norm and value is more relative than many moral philosophers claim. So, Hume claimed that the principle of actions is a mere interest of individuals, and interests are their desiring outcomes in consequence which these individuals are willing to induce.

The study of economics started from challenging the authoritarian moral entrepreneurship dogmatically defining and suggesting individuals to act by means of the universal moral code defined by the authoritarian moral entrepreneurs. Economics is originally an ethics emancipating individuals from the prison of moral dogma and then enabling these individuals to develop their own rational inference skills determining their own mind and action plans. Then, the normative philosophy should purely a matter of each individual’s business for their own mind development, and the positive philosophy should be only taken into practice to plan actions influencing others and plans creating/development physical objects, e.g. buildings and products, and structured organisations in which various humans are gathered e.g. corporations and government.


2. Monopoly and Anti-Trust Law
Monopoly is the situation which one party owns and controls a particular good/service industry/market and its business share without any competitor. Monopoly is usually categorised into the two types, natural monopoly and pure monopoly. Natural monopoly is formed when monopoly is necessary and inevitable to provide the efficient and optimum level of goods and services. In the later parts of this essay, monopoly means pure monopoly. Many economists tend to affirm that monopoly is a negative factor as an antithesis of a good competition. Even conservative economists such as Monetarists tend to assume that monopoly is an economic stagnation discouraging competition.

Pure monopoly takes place where any artificial enforcement power exists in economy. There are two kinds of pure monopoly. The one is that a national government can form pure monopoly by nationalising or heavily regulating a particular industry. The other is that an influential economic agent such as a big corporation prevents competitors away by its control over price and quantity, merging and acquiring a potential competitor and/or bribing. Anti-trust law is designed to prohibit the latter kind of pure monopoly, the pure monopoly by private economic agents.

Socialists (including the self-proclaimed liberals) and other various Staticists claim that any monopoly by their own government is legitimate and virtuous whereas the pure monopoly by private ownership is unnecessary and vile. Even many conservative and libertarian economists tend to think that the monopoly by private ownership is something needed to be prevented at the best effort. The reason behind is the monopoly by their government sets its price and quantity according to necessity meanwhile the monopoly by private ownership does not fulfil the necessity and causes an uneven wealth distribution.

They claim that the monopoly by private ownership is purely motivated by profit and allows these private enterprises to discourage competition enough to reduce both quality of products produced. So that this monopoly causes an inefficiency of products’ distribution among individuals in need, and these anti-monopoly activists argue that the genuine free market perpetuates the monopoly Then, anti-trust law was manifested to prevent such a market outcome by both socialists and non-socialists.


Nonetheless, this claim about monopoly is questionable by means of the free market mechanism. In a free market economy where majority of industries are operated by private enterprises and new market entrants are not strictly prohibited, these entrepreneurs always face some degree of competition. Even natural monopoly is not permanent due to a newly invented technology in the future and a newly discovered resource supply line. Furthermore, unless there is a prohibition by government regulation and/or a cultural/religious tradition, there is often various substitute available. All in all, the antagonism against monopoly seems to be meaningless.

These anti-monopoly activists tend to neglect about the impact of the capital/financial market. Even though a monopolistic firm disrupts any new market entrant potentially becoming her/his competitor in the real (goods & service) market, this entrant will be able to join and compete in this market as long as this entrant’s product is more or equally favourable. The investors in the capital/financial market are keen to invest the assets whose value is predicted to dramatically increase so that this market entrant may gain the capability to compete with the already existing firm. Therefore, when a monopoly is perpetuated, the case shall be either the products produced by this monopolistic firm is demanded or this market is not free enough.

Regarding to the monopoly price and quantity based on the profit motive, the monopolistic firm is extremely difficult to maintain their price and quantity control in favour of its own interest. Even with a restricted supply of both substitute and investment, this monopolistic control is very difficult to maintain especially when the surveillance technology by majority of individuals is widely available. Under free market, information is freely and widely available because every economic agent is competing with each other to obtain a useful information set with their best competence. Therefore, as same as a totalitarian regime in politics, an oppressive monopolist regime is also fragile when majority of citizens start protesting against it.

In addition, by means of macroeconomic situation, the aggregate production share of a market which this monopolistic firm can be not significantly high enough to be considered as a tycoon. When the aggregate production share of this market becomes significantly high, only one firm may become too costly to produce the demanded production level under this market factors of production. Then, production by two or more firms may become optimum.

These anti-monopolists excessively condemn the existence of monopoly because they tend to think that preventing monopoly is the legitimate norm and value in their ideal economic system. By contrast, the existence of monopoly does not always cause the economically negative consequence while it is actually often beneficial to economy. When a monopoly takes place, the operation by one monopolistic firm is just adequate to optimise factors of production than by more than one at the current supply technology and the demand level. Thus, the ulterior motive behind the anti-trust law prohibiting monopoly seems to not be the reason of economics focusing on consequence of actions: It rather seems to be the moral philosophical reasoning focusing on norm and value of actions.


3. Natural Right’s Dogmatism
Restricting monopoly does not frequently cracking down on monopoly. Some monopoly can be wrongly justified as pure monopoly even though it is actually natural monopoly. It could also be not significantly necessary to crackdown some pure monopoly because its factors of production requires only one firm and/or its not significantly high production share in macroeconomic scale. Thus, crackdown on monopoly is not consequently effective for economy.

Anti-Trust law cracking down on monopoly is far concerned with moral philosophy and psychology than economics. The idea of anti-trust and any other anti-monopoly is simply a moral dogma putting a high priority on competition as virtue of individuals always ought to maintain and practice. The aim of anti-monopoly is simply their value of actions does not always derive a desired consequence of economy, and their believing value is not often a means of productive consequences. This is just a matter of their normative belief, and so not related to the positive analyses of economics.

This trend of putting excessive priority on the normative belief tends to be observed in many countries adapting customary laws including the common law in their legal system which regard highly of the existence of Natural law. Even in some countries whose legal system is based on the civil (positive) law nowadays adapt this trend of the normative belief as their constitution putting emphasis on Natural law. Natural law is a legal philosophical theory which claims that there is a universal ethical principle commonly existing at different time periods, places, and occasions. Legal structures based on Natural law hardly indicate the explicitly determined legal code of justice. So, they remain their flexibility of legal interpretation but they are often inconsistent and influenced by irrational whims of general public and charismatic authorities.

There is a derivation theory of Natural law which is called Natural right. Natural right claims that there is a universally existing impregnable rights for all human individuals. Natural right more clearly defines about the universal ethical principle than Natural law as it claims that this invincible right is the universal ethical principle. Natural law regards that human individuals are not able to perfectly know what the universally existing law and ethical principle are because they are not the perfect being like God. By contrast, Natural right defines that human individuals are capable to know what is truly right for themselves. Thus, those who support Natural right tend to assume that their traditional kept value of their invincible right basing their action patterns is the means of their well-being.

The legal positivists and the mainstream classical economists argue that these claims by Natural right supporters are merely prejudicial as their belief does not positively derive the consequences of economy. Natural right may be helpful for each individual’s self-discipline and their personal wish meanwhile it is not practical to positively analyse the estimate outcomes of economics. The typical example is the anti-trust law attempting to prohibit monopoly as the means of their economic consequence. All in all, it claims that anti-trust law concerns moral philosophy far more than economics.

Pathway to the new economics and political theory

1. Globalisation
The expansion of borderless globalised business activities and communication network have been lowering significance of nation states since the end of the Cold War. This phenomenon of the world transformation seems to be controversial but yet hardly discouraged. So, regardless of this controversy, this globalisation process seems to be an inevitable evolution of humans’ activities and daily life. The modern politics and their base modern philosophies have become less effective and less benefiting to majority humans and their interest since the globalisation started overwhelming the power of nation states. Therefore, all modern political theories regarding highly of nation states and their government now tend to be undermined.

An idea of the world or any transnational government, replacing or overpowering national governments, emerges as the aforementioned phenomenon takes place. However, there are many strong opposing views of allowing one or few authorities to control a massive human population. This will be significantly costly to select representatives, collect tax, donation, and investment with an equitable as well as efficient rate, survey for problems, and establish an ideal but also functional political principle avoiding conflict of believes and interests among human individuals.

After having considered about this matter, there is an alternative proposal fitting in with the trend of the globalisation. The proposal to let these human individuals to do what they want, instead of keeping constantly monitoring them, by following the spontaneous flow of their harmony. This shall be a new innovative form of anarchism which fits in with this constantly being globalised humans’ life style. Anarchism has been referred to as an antithesis of this globalisation process and the civil technological development. By contrast, the alternative form of anarchism shall be invented as a functioning and evolved form of the constantly evolving human civilisation.


2. Purpose & Objective
The main purpose of this attempt is to encourage (Classical-/Neo-) Liberalism thriving in this globalisation process while stabilising the public sector management and the business cycles. By taking the decaying effectivity of national governments and the ineffectiveness of the transnational governmental authority, the progressive anarchism proposed here is suggested as the antithetical alternative of both nationalism (led by national governments) and the global collectivism (led by the transnational government).

Since individuals’ activities become more active and dynamic, the size of public sectors has become bigger. At this time, individuals’ reliance on their paternalistic authorities in charge of administrating the public sector has become heavy, and the political structure has become more stratified. When this growing spiral is kept perpetuated, more individuals sacrifice their individual autonomy to expending for propping up this system. Otherwise, no defence and no judicature which are necessary to maintain ones of the liberalist objectives will not be sustained in this already developed and expanded scale of economy and politics.

The objectives which Liberalists pursue are individuals’ autonomic sovereignty encouraging their freedom of choice, voluntary participation to their exchange of their labour, goods, and services with the others, and the fair (agreeable), functional, and rational justice. As the modern world has become more reliant on a bigger scale autocratic paternalism, all the Liberalist objectives have become difficult to accomplish all together at once. Then, under the current world political structure, some of these objective need to be compromised to sustain the current technological and structural development. It is either keep expanding or start repressing the currently growing world economic and political network growth.

Nonetheless, there may need to innovate a new political structure which will attempt to maintain the political network growth while encouraging individuals’ self-governability in the world wide scale. Individuals should not forfeit their Liberalist ideal, and should invent their new innovative political structure adapted to the new economic and political environment. The key stimulus of this new attempt is their power of aspiration encouraging them to aspire their Liberalist objectives which will never be compromised in any occasion. Without the power of individuals’ aspiration, no voluntary mind and movement will take place to attempt to establish the unknown ideal.


3. The Evolving Utilitarian Formula
Please take a look at this algebra following Jeremy Bentham written in Fragment on Government:

This formula denotes the three main political functional bodies of politics from the ancient to the current postmodern world. As each body has its own costs and benefits, the political administrators optimise the power weight of each body to match with what they and/or their fellow citizens demand. The sum of their utility is maximised when the chosen power weight on these bodies is optimised to match with their demand.

In an absolute monarchism or dictatorship, only Monarchy exists as long as only one monarchy or dictator holds her/his absolute power over all. In a pure technocratic regime, such as Marx=Leninist socialism, where a group of selected individuals control over all, only Aristocracy exists. In a constitutional monarchism, Monarchy coexists with Aristocracy and possibly with Democracy. Great Britain is a typical example of all these political bodies coexist together with a stable balanced harmony. Arab Emirates can be considered as Monarchy combined with Aristocracy where Democracy does not exist. The democracy shown in this formula (Democracy) denotes the degree of majority citizens’ voice in politics. This degree is decided how possible citizens are allowed to influence a political decision by casting their vote, directly participating a political forum, or various indirect methods. Anarchism may be described as a direct democracy where only the body Democracy exists.

When the strength of the monarchy shown in this formula (Monarchy) is demanded, then the monarchy should be supplied. In the modern world, even in a republican nation, a resemblance to monarchy exists as a charismatic figure called dictator. In the current world situation, since this world became globalised, the strength of monarchy has been less significantly demanded due to the development of the world diplomacy based on commerce rather than military might and tribunal identity.

The aristocracy (Aristocracy) mentioned in my article and Bentham's Fragment includes oligarchy, bureaucrats, elites, and elected ones in meritocracy. Also, meritocracy is simply the matter of functioning, and the inheritance is accepted as long as their cultural norm encourages or it is only the financially and politically affordable option. The democratic base of meritocracy is superior to the inheritance base when it is affordable because it is more effective to elect the competent representatives.


The transnational government certainly requires a way higher weight on this aristocracy because the citizens of this world literally need to select their representatives for the administration members from much winder space than a nation. The number of their representatives might be higher in the transnational government than a national government meanwhile the number of citizens under its political regime is massively higher in the former than the latter. Therefore, the power weight of (direct) Democracy is relatively repressed in comparison to the power weight of Aristocracy.

The wisdom of Aristocracy can be highly demanded to maintain stable and functional economic and legal policies in a wide scale as the scale of individuals’ activities and life style expand at the current time period. So, it may indicate that the pure oligarchy where the entire political power is weighted toward Aristocracy offers the high sum of utility due to the material prosperity derived from the stability and the logistical efficiency.

On the other hand, there is a counterargument against the excessive political power weight towards Aristocracy, which is described as the centralisation of political power. There is a concern that the maximum utility which Aristocracy derives is lower than Democracy does. In a plain explanation, the centralised oligarchy (An intense Aristocracy) is less able to make people happier than a more decentralised and more democratic political structure.

The following charts display the statistical research outcome based on the Happy Planet Index (HPI), the climate effects explained by latitude of where each nation’s capital is located, and the binary variables representing these three political bodies introduced by Bentham, Monarchy, Aristocracy, and Democracy.



Ref. Happiness related to Monarchy, One Party, and Democracy
Published on 12/07/2012 12:57 British Summer Time

After extracting the climate effects (Latitudes of countries) from the HPI, this regression analysis indicates that Democracy tends to increase the HPI more than the other variable and the Aristocracy tends to suppress the HPI rather than stimulating.

This analysis seems to infer that even though an oligarchic political structure (An intensive Aristocracy) is less likely encourage human individuals to become happier. Although the oligarchic policy produces a high material prosperity and stabilises a political stability in a wide scale, majority individual citizens are less likely sense much happiness from the material prosperity and the political stability. Therefore, there is a risk that the further centralisation of political power may sacrifice a high degree of happiness of majority human individuals: It would be better to revise the evolution process to reincarnate and maintain a decentralised and democratic alternative while remaining the globalisation process going on.


4. The Problem of Administrating Public Sectors

In a traditional sense of modern economics, each nation is responsible for administrating its own public sectors operated in this nation. On the other hand, this form pattern started encountering a new problem in this globalised world with economic agents with a more active and wide life style and more affluent sets of choice than the Cold War period. This phenomenon encounters with the problem of claiming who is responsible to pay for what they have used. Majority of countries operated by modern macroeconomic concepts operate their fiscal policy based on a national level and two or various regional level in inside a nation. So, there has not yet solid transnational fiscal policy concept emerging yet. There is a proposal to introduce a solid and well-defined transnational fiscal policy nowadays. However, this encounters with the high administration cost and the lower sum of utility which are mentioned in the previous chapters.

There is also a remarkably significant macroeconomic problem related to this globalisation and the expanding individuals’ activities. Not only the fiscal responsibility issue but also controlling the entire macroeconomic climate such as boom and recession. Due to the globalised activity level of businesses and individual life style, the business cycles of nations are more and more harmonised ever than it used to be. Then, the macroeconomic intervention by the macroeconomic policy such as the monetary policy, the fiscal policy, the international trade policy, and various supply-side policies such as controlling and monitoring the labour and capital mobility is less efficient. This is because one nation’s macroeconomic climate is highly more influenced by the others so that it may rather require the macroeconomic intervention in a tremendously wide multi-national or even a world-wide level which simultaneously control over the entire targeted region of this world at once. However, as same as the previously mentioned responsibility issue, this encounters with the high administration cost and the lower sum of utility which are mentioned in the previous chapters.

Both the first responsibility issue (microeconomics) and the economic climate issue (macroeconomics) are concerned with the matters mentioned in the previous chapters. The administrators of these public sectors defining the cost coverage responsibility and the resource allocation are more centralised and become in charge of administrating a wider scale. Then, the politics tends to become more oligarchic so that this eventually encounters with the high administration cost and the lower sum of utility. This centralisation may be considered as the optimum only if individuals are happy with their high administrating cost and the potentially relatively low utility level compared to their possible decentralisation choice. Therefore, even though the centralisation may have a high advantage over the decentralised counterpart in some field, the opportunity cost of this choice is also high. In addition, this project aims at reincarnating the original Liberalist principle and anticipated outcomes so that the alternative possibility of seeking a decentralised form of politics shall be more desired than the centralisation option.

On the other hand, the problems of the public sector administration issues cannot be simply ignored. Some economists claim that it should be possible to put the decentralised politics in this global economy without taking these previously mentioned issues into consideration. Their claim is that the responsibility is spontaneously determined by all free economic agents fairly by following the natural free market movement toward equilibrium. Nonetheless, this equilibrium is not always a good equilibrium as many other economists affirm that there are both good and bad equilibrium outcomes.

The Game theory wisely indicates the bad equilibrium condition called the Prisoners’ Dilemma. The good equilibrium condition is where all individual economic agents pay for what they have used and how capable to contribute to meanwhile majority or a few influential cohorts of economic agents rationally counter-act against the deviating business cycles without relying on the collective macroeconomic policy. The bad equilibrium condition is where many economic agents are not contributing by means of their ability and responsibility, and then the economic climate is always in turmoil due to their disturbed unstable business cycles. The prisoners’ dilemma warns of the free riding which means that many take advantage of letting or even enforcing the others to cover for the service meanwhile they obtain the shared common benefit from this service. This Prisoners’ Dilemma takes place when nobody shares the same principle and objective to fulfil their mutual interests because of their ignorance about what is occurring in real and what they are supposed to do to overcome from their unwanted situation. Afterward, even a generous altruistic individual will eventually stop contributing to sustaining this system, or just be kept exploited until the end. Therefore, by perpetuating this situation, individuals tend to be diverted from the good equilibrium and then be converged at the bad equilibrium as long as the aimlessness and the ignorance prevail.

In the traditional sense, human individuals have kept their reliance on the collective rational authorities to direct their economic policies with their paternalistic wisdom. In the feudalism, the feudal lords and the divine authorities were their representative guardians in charge of this paternalism. In the modern world, nation states and their government are the paternalistic guardian institutes meritoriously selecting their representatives from their general public. This collective authoritarian method has been functional as long as these paternal guardians have their strong principle encouraged by their nobles’ oblige and the scale is optimum size.

Nevertheless, these paternalistic authorities are not often honest to serve for allocating all resources available to induce the good equilibrium. They may avoid the bad equilibrium as long as they are aware of the mechanism of economics because the bad equilibrium induces the bad condition for not only the majority individual citizens but also themselves. But, they often take an advantage of controlling this collective resource allocation to split the resources into their own profit. As far as the power of these authorities becomes stronger relative to the others’, the margin of their profit taking becomes higher as they are more able to monopolise their power from this political structure. Therefore, the further expansion of centralised collective governmental institutions increases a significantly high risk of reducing the sum of utilities in proportion to the political power centralisation.

By contrast, there is a hope that human individuals might no longer need to reply on these collective paternalistic authorities as these individuals will become more self-governable than before. They are becoming more capable to gain their appropriate knowledge and skills due to the rapid development of the information technology. Then, as the surveillance technology has been dramatically developed, the cooperative model, as an alternative of the transnational government base, of running public sector might be more possible in the world wide. So, as long as individuals willing to prop up this cooperative public sector are voluntarily as well as collectively participate to be responsible for sustaining and operating it, it may function. If it is possible to operate, then something not able to privatise such as defence and judicature may be preserved even in an anarchist politics. However, this is still an unknown ideal which has never been experimented yet.


5. Modern Economics meeting with Philosophy
The critical condition is that citizens of this political structure have to become highly self-governable and maintain their relationship with their objective mutual interest. The public goods and services may be able to survive by introducing the public sector governed by a cooperative of autonomous citizens where all its participants voluntarily expense for the cost and voluntarily operate to provide goods and services. But, this challenge is considered as extremely difficult or even impossible due to its lack of certainty to collect their expenditure and define who is responsible to pay. Democracy (in particular, the direct democracy) is a privilege, rather than a condition, for a civilisation where majority of citizens are enlightened and a plenty capital/wealth is accumulated. In order to accomplish in such a difficult challenge to acquire this privilege, these individuals have to have a strong ethical principle defining their own ethical compass motivating themselves to maintain and develop their self-sustainability.

This ethical principle forming their ethical compass has to be something not only encouraging and sustaining the harmonious voluntary cooperation among all individuals together but also tolerating and fulfilling their egoism at the same time. Without a harmonious cooperation based on a voluntary participation to this politics, individuals and their surrounding environment fall into the bad equilibrium explained in the previous chapter. Without tolerating and actually encouraging egoism, an active market economy increasing the wealth of individuals and their civilisation and individuals’ voluntary spirit hardly emerging. Therefore, it requires to install an ethical principle fulfilling these two functions, harmonious cooperation and egoism, together.

In traditional sense, religion has been the main function to instruct human individuals about the virtue of peaceful harmonious cooperation since the establishment of human civilisation. If religion is already an outdated principle not fitting in with this current world situation, there may needs something substituting religion. In a relatively less democratic system where the weight on Monarchy and Aristocracy (The variables shown in the previously mentioned Benthamite algebra) is high, majority of individuals can live without always reminding of the ethical principle because the political system always provides them with its ready-made ethical compass directing the whole general public. By contrast, in a direct Democratic politics self-governed by autonomous individuals, majority of individuals must be aware of their own responsibility to guide themselves.

In order to keep the technological development and the progressive evolution of civilisation, egoism is an unavoidable key factor motivating individuals for being loyal to this cooperative politics. The success of the modern world development is encouraged by the enlightenment philosophy tolerating and fulfilling the individuality of human-beings and their egoism. By means of nature, human individuals cling to satisfying their own biological and psychological needs and wants. Moreover, as Napoleon Bonaparte said, they are more easily governed through their vices than their virtues. Therefore, the politics eventually is required to take these natural characteristics into its account. Otherwise, these human individuals simply become too castrated and nihilistic to be energetic because the voluntarily self-governed politics highly requires their energy motivating their competence.

All in all, both economics and politics will be necessary to adapt these philosophical concepts. Studies of modern economics nowadays tend to lack the philosophical insight compared to the classical economics including the one invented by Adam Smith. Modern politics are unavoidably compatible with the existence of the nation states and possibly some form of transnational government and their authority. At this current transitional time period, there shall need to be a completely brand new economic and political theory emerging to solve the problems and the requirement mentioned in this project. A form of anarchism might be no longer an idealistic politics, and it seems to be rather necessary to take putting this political philosophy into our consideration in real. Hence, the endeavour to this pathway to the new economics and political theory should exist as an interesting experiment, and it should be desired to be a practical theory in the near future.

Liberalism and Rule by Law

1. Liberalism in General
Liberalism is the political philosophical ideology which has so many branches and their derivations. There are many political philosophers claiming their own believing liberalism is the legitimate mainstream ideology of liberalism. Some claim that less autocratic form of socialism is the most updated evolved liberalism among all branches of liberalism existing in this world. Nevertheless, the founders of liberalism as the modern Western philosophers from 16th to 19th century would have disagreed with this definition. This essay sticks to the original definition of liberalism defined by the liberalist philosophers in these early time. Liberalism mentioned here is often called the classical-Liberalism or Neoliberalism. The true liberalism mentioned here is an antithesis of these modern political self-proclaimed liberalists.

(The Classical) Liberalism (/Neoliberalism) promotes the restricted size of government and their intervention to offer individuals freedom of choice based on their voluntary actions and free will. Liberalism encourages individuals to be self-governable which is free from excess intervention of any authority. Individuals should be free to think, act, and desire as long as they are responsible for their choices. In order to encourage individuals to cohabit together under a strong consensus with a minimum conflict, they often have to trade between different individuals with the right feasible exchange rate. Free competition of production and bargain and mutual agreement with individuals’ free will are the key to derive these feasible trade operations at optimum conditions. These processes must be moderated by the spontaneous order called the free market mechanism.

Liberalism regards highly of the free market mechanism which is also called the Invisible-Hand of God. Free market shall be only the sovereign guiding individuals to optimise their action patterns and their deriving consequences adjusted to what is needed/wanted within availability. The free market force is required to control the demand and the supply of natural resources and the production capacity in order to avoid an extinction of resources and both excess and lack of desire. Individuals are free to decide the amount of their reward for their labour and skill and the price of their products freely, and negotiate their exchange with each other. The free flow of exchange is volatile but enables their trading products with their suggesting price converge to the equilibrium rate which is the optimum level to balance the demand and supply. One monopolistic individual or organisation ought not to subjectively decide what the equilibrium quantity and price in trade are.

Nobody except for God perfectly either knows about the current environmental state or perfectly predicts the future state. So, individuals should rely on a spontaneous flow of the free market where many different demand and supply conditions are interacting each other to eventually determine the equilibrium point. No human individuals can be perfectly objective meanwhile this spontaneous force called the free market is not determined by a subjective motive. The frequent interaction of the demand of individuals, the supply of what are available, and the mutual agreement through various free competition, gradually selects the optimum combination of demand and supply. Only the supernatural power, which is called God but nobody is perfectly sure what exactly is, might know the right optimisation. This unknown but certainly existing spontaneous force is neutral among all individuals so this characteristics should be considered as objective i.e. not subjective as superstition explained below.

Liberalism defies superstition which illogically and irrationally guides individuals’ choice and will. Liberalism aims to liberate people from traditions retained without proper assessments and hypocritical moral principles subjectively determined by a bunch of moral entrepreneurs. Of course, traditions and moral principles are important but need to be constantly evaluated and revised regularly in order to assess whether or not they are truly necessary at the current time, place, and occasion by means of the market force and individuals’ free will. Each individuals’ must rely on their own rationality to choose what is right and wrong. Individuals may refer to some objective guide line as long as their rational intuition indicates it as legitimately objective to follow. No superstition should be their guide line of choice and mind.

(Military) Defence is the factor which cannot be dictated by the previously mentioned free market mechanism. Providing the adequate defence power requires an extraordinarily huge scale of economics whose marginal cost will never be diminished by a free competition among individuals and their enterprises. This is the case that bigger the organisation is always better. The defence cost must be shared among all individuals and collect their expensive with an involuntary force regardless of their free will. Their benefit gained from a good defence force is a public good as same as the air they breathe. Therefore, defence should be operated by one monopolising institution which is free from the market competition.

Judicature, explaining law and its legal code and determining the law enforcement level, is also the factor which is required to be a monopolistic institute considered as the public good. Law is not perfectly objective unlike the free market force. But, it is still considered as the important guide line for individuals to follow when they require some explicitly indicated guide line to follow. Understanding law and its codes and executing law enforcement at the equitable level to what the target commits require a high level of intelligence. There should be a competition of interpreting law from different angles. But, the final decision making power needs to be one body in order to maintain the consistent measure of judgement. The one holding this measure of the final decision power should be law which exists to prevail as a semi-objective guideline in a long run.

Individuals are free to do and desire whatever they want to the certain extend. But, they are not completely free from ignorance. It is a destiny for human individuals to be haunted by ignorance. They do not always know their choice derives their desired consequence. They do not always know the true value of exchanged goods and services in their trade with the others. Their level of rationality is not always capable to know what really a rational and objective guide line is for their life. They are often involved in an unproductive conflict when they misunderstand each other so something objective needs to mediate and stabilise the situation. Law maintained in a long time partially evaluated and amended if necessary prevails.

2. Rule by Law
Karl Marx, the figure head of socialism, argued that law is created by means of the minority ruling class individuals’ interest to rule the majority subordinate class individuals. Nonetheless, Charles-Louis de Montesquieu, the remarkable schooler famous for studying comparative law, argued that more equal and freer political structures eventually require law whereas law tends to be less significant in an autocratic politics than the former. In a politics which undermines the significance of law, those who hold a charisma take advantage of their political power to lead the rest of individuals with their subjective commands. Marxian socialism thus consequently ends up with either a tyranny of government bureaucrats or a tyranny of mass. Montesquieu’s argument effectively explains why Marxian socialism of both autocratic form and democratic form tend to be less liberalistic.

Democracy does not always imply liberalism. Democracy contains its high risk of failing into a tyranny of mass/mobs. The majority may enforce all the member of this political structure to follow a homogeneous norms and values. Then, they may start undermining individual sovereignty in favour of majority’s enforcing norms and values, and any unique characteristics is endangered by this rule. This majority rule discourages the cohabitation of different individuals. For example, unique individuals living in a unique life style can be seen as strange for the majority mass so that the majority may discriminate or even threaten the life style of these individuals.

This majority rule may harm themselves in the long run. For example, when they prefer printing excess money and claiming to increase public expenditure while reducing tax revenue, their economic system will be unstable and chaotic as the hyper price inflation and the lack of public goods & services against their demand. Moreover, the majority mass can be jealous of a few talented individuals, and may induce policy to penalise these competent talented individuals under their majority rule. This consequently discourages competition basing economic productivity and cultural maturity and devalues the respect for competence.

The majority rule can also discriminate or even threaten some patient and kind-hearted individuals. Human-beings are often driven by cruel and vile motives as human-beings cannot be always virtuous and generous. Often, not many of them are patient and merciful enough to repress their cruelty and vice. When they find themselves as miserable and then become frustrated by their inevitable bitterness of their life, they may often target somebody weaker than them to easily bully to release their frustration off. There needs something rational as well as objective to prevent such an uncivil motivation of humans as much as possible. Then, law and ethical principle are required for this purpose.

Even Jeremy Bentham and John Stuart Mill, the devote supports of democracy, argued that the tyranny by mass is dangerous as much as the tyranny by one/few. They affirmed that there need to be law and legislation and a rational (legal) authority monitoring the system based on them not to induce such a havoc while maintaining to deserve for the happiness of individual citizens living there. Thus, law becomes a significant factor to balance the restriction by law and legislation monitored by the rational authority and the mass’s desire.

In the developed stable civilisation which succeeds in maintaining the balance regards highly of the rule by law. The well-defined law functions as the explicit guideline for both rational authority and mass to refer in order to accomplish their happy productive balance. By contrast, the civilisation which puts priority only on doing favour for a particular group of citizens, including both aristocracy (Favouring minority elite) and socialism (Favouring majority mass), depreciate the aggregate prosperity of this civilisation.

The Western European, the North American, and some of Asian nations are remarkable for maintaining the rule by law mentioned above. In these nations, there are two forms of the legal principles, the natural law and the positive law. In the modern national legal system, there is no exact clear cut between these two forms of law. The natural law is based on what the rational as well as emotional wishes of individuals require at each different time, place as well as the invincible universal moral principle. These individuals’ decision is flexible as long as it is not noticeably deviated from the moral principle. The positive law is based on the explicitly written forms of agreements based on logically coded definitions of what law allows and prohibits. This law is rigidly defined by the rational authoritarian censorship. But, the objectivity of judgement is preserved by its logically coded written guideline. Both forms of law fulfil keep the power balance of the rational authority and the majority as well as the aforementioned condition required by Liberalism.

Before the modern time periods, majority of human tribes and civilisation followed their own unique customary law, and their own interpretation of the natural law existed. The modern liberal interpretation of natural law was developed by England (and then the United Kingdom of Great Britain and Northern Ireland) and the United States of America. The UK and the USA have taken advantage of their natural law base legal system which is flexible to adjust to what individuals’ demand in business.

The positive law bases many of the modern national laws. The positive law was firstly established by Ancient Romans, and imitated by Roman Catholic Church and many feudalist rulers in the medieval Europe. Napoleon Bonaparte put a high emphasis on the Roman style positive law under his rule, and he spread his legal codes over his conquered lands. Prussian empire took an advantage of substituting the traditional German traditional law with their contemporary new legal model to expand its power. Japan imitated Prussian legal model so that the born of Japanese legal structure is still influenced by it.

The objective principle of the positive law varies across different time periods, places, and occasions. Before French revolution, the objective of the positive law was to deserve the ruling class’s interest. From French revolution to the current time period, the positive law has been designed to satisfy majority citizens while maintain the political order. Since more individuals and their belonging institutes and nations became aware of the need of being adapted to the free market mechanism, the positive law has functioned as the explicitly written format of business agreements. In the global economy, even some illiberal nations partially adapted the positive law in order to take an advantage of the explicative positive law as their explicit business guide lines.



3. Comparative Study of the Laws supporting Liberalism
As explained, there are two mainstreams of the law principles, the natural law and the positive law, supporting Liberalism. The type of Liberalism predominantly following the natural law as the principle of law and ethics is called Natural Law Liberalism. There is another type of Liberalism which is sceptical about how Natural Law Liberalism derives Liberalist law and ethics from. Both kinds of Liberalism has its own strengths and methodologies to define and encourage Liberalism and the political structure based on it.

Both laws are relatively compatible to support Liberalism. But, both laws are not perfectly fulfilling what Liberalism claims for individuals and their action patterns and mind sets. Liberalism maintained by the rule by law traditionally requires the existence of a nation state as a guardian of its rule. So, this essay explains some examples of how the rule by law protecting Liberalism functions in a nation.

3.1. America as an example of Natural Law Liberalist Nation.
When the United States of America (America) was established, America seemed to be an unstable nation. Because America is a democratic republic nation without a unified political decision making code, majority of American people think their voice frequently represents American politics and American future and so actively participate into politics. Because there is neither a hereditary monarchy nor any paternalistic autocratic executive branch who would have a final say in politics, it looks like resulting in unstable outcomes where the ongoing havoc continues to takes place. Then, Americans decided to emphasis on and follow an abstract universal principle for their legal and moral judgement instead of one unified man-made autocratic body.

There was no monarchy, or no autocratic executive branch, who guides the nation to follow or refer to their suggesting principle, American nation is endowed with a nonhuman/non-manmade sovereign, and then all American have become equal under it since American establishment. This nonhuman sovereign is called God by believers, and called either humanity or the categorical imperative by agnostics and atheists. In America, even agnostics and atheists tend to have a faith in a mystic transcendental being. Even though they challenge against the traditional faith in God, their custom of worshiping a nonhuman sovereign above all human-beings has never changed since America was founded. This characteristics of American ethics still forms American politics and influences how America as a whole nation changes over time. This aspect has encouraged Americans to share and aspire in pursing one universal moral principle, the natural right created by either God or any transcendental being.

Even though there are more than one fragmented groups of political thought which American politicians and people belong to, majority of them share the common ethical principle which is called the natural right. Natural Right is an impregnable universal right provided equally to all human-beings. In Anglo-Saxon territories like America and Great Britain, it was most notably spread by John Locke, a devout Christian as well as the British philosopher dialectically defined the Natural Right theory, and Thomas Paine, one of American founding fathers. When America was founded, both Christian value and the enlightenment philosophy of the natural right, were introduced to be the base universal ethical principle of American nation. Both Christianity and Natural Right ethics regard highly of a universal eternal reality which is believed to exist at any time, place, and occasion and also believed to be the universally legitimate measurement of legal and moral judgements. This universal eternity is called Natural Law, and the type of Liberalism follows Natural Law as its fundamental principle is called Natural Law Liberalism.

3.2. The New American Ethical Principle: Kantian Deontology
When several years after American independence had passed, the change in American people's mind started taking place. During the 20th century, the new modern political ideology emerged in Europe, and this spread the strong scepticism about religion, history, culture, and the pre-existing perception of this world in Europe, and then the rest of the world afterward. The mastermind of this movement was Immanuel Kant, and his followers encouraged this movement. America was not an exception from its influence, and in a different form from the others, the influence was way stronger than the rest of the world.

The speed of spreading its influence was slower in America than the rest of the world due to Americans' strong resistance against this European born politics which seemed to decay the traditional American Liberal Democracy based on the Natural Right ethics originated from Christianity. Nevertheless, because Kantian ethics was evolved from Lockean Natural Right theory, Kantian Deontology was familiar to American political culture. As same as American traditional Natural Right theory, Kantian theory puts emphasis on the universally right morality, an absolute truth, and the challenge against the reality, and these characteristics of Kantian philosophy corresponded to American personality. More than Europe, because the natural right ethics is more influential in America, Americans are more likely to constantly put emphasis on the universally right morality, aspire after an absolute truth which they believe in, and express their world view by means of their idealism. Then, Americans adapted Kantian philosophy to America as a different form from the European counterparts.

After some time passed, agnostics and atheists started appearing in America. But, even though the characteristics of someone changes, the fundamental quality of the innate personality of all the people tends to remain unchanged. As America, the nation, was born as a Christian and Liberal Democratic nation who has a strong invincible universal ethical principle, American agnostics and atheists tend to look for the agnosticism and the atheism whose fundamental characteristics is similar to both Christianity and the traditional Natural Right. Kantian characteristics of God-less monotheism has attracted many American individuals who were disappointed by Christianity for some reason, and then Kantian Deontology has become an alternative belief for these Americans which is different from Christianity but whose characteristics is similar to Christianity.

Kant was a German, but his ethics as well as the legal philosophy influenced by Kantian ethics seemed to be more influential in America. In European and any modern secular nations, the objective of creating legal codes of law and imposing the law enforcement is the economic and political stability. Then, in these nations, morality is considered to be relative to various different cultures and situations in these nations so that morality tends to be considered not as a primary matter in law. Therefore, their social justice tends to refer to the objectively (Kantian theorists call "hypothetically" instead) determined measures and values such as property values, utility (pleasure minus pain), and any form of physical or psychological sanctions predicted to induce a desired consequence i.e. the stability. By contrast, American social justice regards highly of the abstract but absolute universal moral code equally important as or sometimes more than any legal legal codes of law which Kantian theorists may call hypothetical (Not categorical). All in all, Kantian ethics and legal philosophy deeply corresponds to American mentality and was adapted to one of the big political ideology groups of America (The other groups tend to be deeply sceptical about Kantian philosophy due to its compatibility with their characteristics and political aim).


3.3. Liberalism of the Father of Economics originated from Legal Positivism
Adam Smith is the father of economics as well as one of the remarkable scholars of British Liberalism. So, his philosophy is a good example of Liberalism, and his Scottish background will help to compare and contrast the previously mentioned Natural Law Liberalism, most notably influential in England and North America, with his Liberalism born in Scotland.

Firstly, more than English and American legal system, Scotland has had a closer relationship with Continental European counterpart. So, the influence of Continental Europe on Scotland is still strong, and Scotland adapted both Enlightenment Philosophy and Legal Positivism much faster than England. For example, Scottish regional law is based on Legal Positivism as same as Continental Europe, and the concept of Separation of church from state strongly exists in Scotland unlike the rest of Great Britain. This is the aspect that Smith's Liberalism became eventually different from Natural Law Liberalism. Adam Smith’s philosophy was highly inspired by Scottish and European enlightenment (The enlightenment) and Legal Positivist philosophy. So, they insisted that only the optimum way is to let all be free to do what they want instead of relying on a particular moral and legal entrepreneur to command all.

Adam Smith’s philosophy cannot be compatible with Natural Law Liberalism and its derivations such as the Natural Right ethics and Kantian Deontology. He would have argued that Natural Law Liberalism and its derivations put excessive emphasis on paternalism to command humans to follow their abstract moral principle. He would have pointed out that there is no guarantee to accomplish what the abstract moral principle without any sacrifice of either the material prosperity or the big collective involuntary force. Because humans are not God, it is impossible to control their surrounding nature and unseen future. Therefore, by referring to his theory of the Invisible Hand, he explained that there is no absolute moral or legal command which creates a perfect world.



4. Beyond Nation State: The Transnational Rule of Law and The Unknown Ideal
Both Liberalism and the rule by law have been prevailing in the modern nation states. Law has been created to fit in with what a nation requires. National law is applied to a nation which creates this law so that a nation has its jurisdiction over where it governs. Also, a province of a nation has jurisdiction over its province. Both national law and provincial law are applied to this province of this nation. Then, individuals living or visiting in a certain province in a certain nation have to follow the national and provincial law there. Overall, as long as both provinces and individuals belong to a nation, the national law prevails, and this nation has its legal authority to monitor and direct the legal structure.

There is an assumption that the concept and the structure of nation states will everlastingly keep existing and thriving as long as the rule by law is going to be maintained. Therefore, this assumption infers that liberalism, encouraged by the rule by law, may only prevail with a nation state so that the end of nation state may imply the end of liberalism. Nevertheless, there are some counter-arguments against this assumption. There are newly emerging forces challenging against the regime of nationalism, and they offer various alternative forms of the rule by law. The following only introduces the alternative form promoting liberalism.

4.1. The United Nation (UN)
First of all, many transnational public organisations have been established since the last century, and they have the legal authority as a transnational judicature. The United Nation (UN) is a politically as well as a philosophically significant transnational. Its power of the legal authority is not absolute as same as a national and provincial judicature because the UN does not hold its law enforcement power to execute its legal sanction. However, by means of the current interest in maintaining an international unity in all over the world, the UN and its legal responsibility is well considered and respect in this world. Therefore, the UK and its international law are not negligible factors to discuss about.

The UN law is a form of the customary law and its principle philosophy is the Kantian deontology which regards highly of the universally absolute morality. This political philosophy is a form of a utopian idealism promoting its idealistic goal which is extremely difficult to accomplish with the limited resource supply. The UN idealism seems to be effective to attract many dreaming individuals to the UN’s aspiring political ideology. But, its idealism is struggling to attract the investment funding it owing to its impractical politics.

There are many objections to allowing the UN to hold a huge power. As same as socialism seen in history, the big government combined with the law enforcement power may consequently induces its original politics to an oppressive totalitarian. Even though they start from having a virtuous political motivation, they may become corrupted after gaining its monopoly power prevented from constant scrutiny. In addition, this principle is too abstract to measure how sanction should be provided. So, there is a risk that fluctuant emotional whims and a charisma of the orators may control over the level of sanction instead of more objective measures of judgement like those stated by the positivist law. Thus, the UN law and its legal sanctions are not favoured by practical thinkers.

All in all, the UN is a remarkable example of the rule by law which is not a traditional one executed by nations. However, this does not seem to be a more powerful legal authority than a national judicature. The UN might only keep existing as an auxiliary structure cohabiting with various nations, and the UN law may exist as a simple principle of laws like a constitution of nations.


4.2. The European Union (EU)

The European Union (EU) is also the emerging transnational structure semi-governing all over the EU member nations and individual citizens there. This has a more limited jurisdiction but a more significant legal authority and a stronger law enforcement than the UN. If these EU members are willing to develop and maintain their EU integration, the EU as a more legitimate and powerful judicature than it is for the time being.

The EU law is based on the legal positivism which is the traditionally dominant legal codes in the Continental European nations as majority of the EU member nations’ judicature is based on the legal positivism. The function of the EU legal positivism is also aimed at promoting individual liberty for all EU citizens and rationally functional economic and legal policies. These law are positively coded in order to provide these EU members with concrete planning to maintain their unity and further growth.

There are two major challenges the EU faces. The one is the establishment of the European Monetary Union (EMU) integrating several EU member nations into one monetary policy under the prudential fiscal policy. The other is providing individual European citizens with the positive liberal contract between these states and their citizens. These policies which the EU manifests are Liberalistic so that the rule of law is inevitably a significant and unavoidable factor which the EU needs to emphasise. The explicitly written and logically explained positive instructions are required to conduct these two challenges as explained in the following paragraphs.

The EU economic policy is to offer a prosperous as well as fiscally stable union of nations with a wide trade zone available. In order to stabilise the monetary policy of such a wide scale, it critically requires a strict tight measure to control the balanced sustainable growth rate among the Eurozone nations. In particular, as the fiscal policy of these EMU member nations (the Eurozone) is not unified unlike their monetary policy, this challenge is severely difficult as only the monetary policy is only the reliable direct tool for this objective. In a relatively smaller scale of economy, this kind of matter is less likely to arise because individual economic agents are easier to correct their errors themselves. By contrast, in such a huge scale of economy, the misguided errors of their actions contiguously affecting the others in a huge scale, the strict guide line attempting to minimise these errors is essential.

The EU personal policy is to offer the pluralistic politics which is morally and politically permissive to provide their citizens with a high degree of freedom. One of the aims of the European integration is to derive a strong peaceful unity and its hopeful prosperous future of Europeans together. The moral neutrality is high essential to avoid the conflict of values in these various different political and religious backgrounds of Europeans. The positively stated law and legislation are also the key factors to create agreeable as well as explicitly understandable contracts among these Europeans. Therefore, the legal positivism prevails for their aim.

Those who are mostly benefitted and improved are the Ex-Communist new EU member nations. In order to liberate individuals in these Ex-Communist nations, liberalism under the rule by law is a brand new treasure to guide them to the EU liberalism. They have been suffering from the lawlessness of illiberal socialist nations since they were forced to follow Marxian socialism. As explained in the aforementioned chapter, Marxist socialism undermines the rule by law and strongly defies liberalism so that these citizens’ liberty has been violated there. By contrast, the EU is attempting to replace their chaotic Marxian socialist asset with the new liberal policy positively stated and conducted by the rule by law.

The problem is its technocratic autocracy limiting individual citizens’ participation in the legislature and the judicature. As the governed jurisdiction size is so massive that it is often very inefficient to seek citizens’ opinions about the new policy proposals and the ongoing judgements every time. Furthermore, as those who are well informed and qualified with the laws and the legal procedures have to be appointed to the legislators and the judges under the EU legal positivism, it is extremely inefficient to base the system on the fully representative system. As same as the UN, there is a significant risk of transforming to a totalitarian regime when they started putting an excess priority on the integration and the administrative efficiency. Thus, balancing between the EU liberalistic ideal and the administrative reality is a touch challenge.

4.3. Unknown Ideal: Stirnerian Anarchism
There is another attempt to overcome from the regime of nationalism. These two previously introduced examples, the UN and the EU, are those which rule individual citizens from a bigger scale than a nation state. The other case is the opposite direction: This suggests for liberalism in a smaller scale of rule by law. This is a form of anarchism but different from almost all kinds of the Classical Anarchism. This form of anarchism is not yet put into practice in the real world.

Anarchism pursues the maximum possibility to accomplish the perfect political structure providing individuals with what liberalism offers. The most notable difference between the mainstream sides of liberalism and anarchism is their perspective on law. The mainstream sides of liberalism regard highly of the rule by law meanwhile the most forms of anarchism defy the significance of law. Some forms of anarchism, especially Godwinian anarchism, tend to glorify the regime of the tyranny by mass as the counter to the tyranny by few. Communist/Socialist forms of Anarchism contradict the modern progress of rationally understanding the objective forces of this world. In other word, they reject the development of civilisation based on individualism, equitable trades (which is only the fair trade) in free market, and any material prosperity. They claim that these factors conversely divert individuals from what liberalism originally aspires. The alternative form of anarchism introduced in this essay is considerably different from these forms of anarchism.

There is an anarchist political philosopher called Max Stirner who created his own unique political theory to endeavour to liberate all individuals living in this world. His theory largely accepts and even promotes, equitable trades (which is only the fair trade) in free market, the civilisation development based on individualism, and any material prosperity. He defended individuals’ own property right and the existence of money as an intermediary of trading their possessions and natural resources. He put emphasis on the importance of rationally forming contracts between individuals as same as anyone supporting the rule by law. The remarkable accept of Stirnerian political theory is to accomplish these aims without moral entrepreneurs, rational legal authorities, and nation states.

Stirner was also against the tyranny by mass as much as the tyranny by few in both feudalism and modern nationalism. He attempted to liberate all individuals to let them live freely with their own free mind and their individual sovereignty prevail without any interaction by any superior authority or moral censorship. So, any form of tyranny interrupting each individual’s own sovereignty is an ultimate enemy of individual liberty. Then, individuals’ free will and their freely formed contracts have to be rationally carried out, and there needs to be an alternative political structure propping up this system, and the process needs to be spontaneous rather than forcible.


Stirner claimed that the moral entrepreneurship promoted by natural law liberalism narrow down individuals’ ethical views to only already existing traditional perspectives. This is then preventing them from inventing an innovative new ethical perspective fitting into what a new situation requires. As same as Jeremy Bentham claimed to contradict British Common Law, Stirner also put emphasis on the objective measurement of justice not restrained by old tradition and irrational whims.

However, Stirner also claimed that the strict legal positivism perpetuates the power monopoly of the rational (legal) authorities in a national or transnational judicature. He affirmed that all individual humans are endowed with their potential to be rational enough to be self-governable. He also argued that freedom of choices without any paternal guardianship by any authority is the key to not only maximise individuals’ happiness but also train their self-discipline. Therefore, he suggested that individuals should have their own free mind to contradict the already existing positivist rule to insist on their own positive agreement/disagreement on contracts.


The critical condition of Stirnerism is that citizens of this political structure have to become highly self-governable and maintain their relationship with their objective mutual interest. This means that they can no longer rely on any national welfare programmes and any paternalistic opinion leader. The public goods and services may be able to survive by introducing the public sector governed by a cooperative of autonomous citizens where all its participants voluntarily expense for the cost and voluntarily operate to provide goods and services. But, this has been considered as extremely difficult or even impossible due to its lack of certainty to collect their expenditure and define who is responsible to pay. The positive opinion to reincarnate the cooperative model is that the surveillance technology has been dramatically developed. So, as long as individuals willing to prop up this cooperative public sector are voluntarily as well as collectively participate to be responsible for sustaining and operating it, it may function. If it is possible to operate, then something not able to privatise such as defence and judicature may be preserved even in an anarchist politics. However, this is still an unknown ideal which has never been experimented yet.


The world politics and public sector economies have been controlled by each nation state and its nationalism. In addition, since the world diplomacy and economy became globalised, some transnational public political institutes have emerged. Since individuals’ activities become more active and dynamic, the size of public sectors has become bigger. At this time, individuals’ reliance on their paternalistic authorities in charge of administrating the public sector has become heavy, and the political structure has become more stratified. When this growing spiral is kept perpetuated, more individuals sacrifice their individual autonomy to expending for propping up this system. Otherwise, no defence and no judicature which are necessary to maintain ones of the liberalist objectives will not be sustained in this already developed and expanded scale of economy and politics.

The objectives which Liberalists pursue are individuals’ autonomic sovereignty encouraging their freedom of choice, voluntary participation to their exchange of their labour, goods, and services with the others, and the fair (agreeable), functional, and rational justice. As the modern world has become more reliant on a bigger scale autocratic paternalism, all the Liberalist objectives have become difficult to accomplish all together at once. Then, under the current world political structure, some of these objective need to be compromised to sustain the current technological and structural development. It is either keep expanding or start repressing the currently growing world economic and political network growth.

Nonetheless, there may need to innovate a new political structure which will attempt to maintain the political network growth while encouraging individuals’ self-governability in the world wide scale. Individuals should not forfeit their Liberalist ideal, and should invent their new innovative political structure adapted to the new economic and political environment. The key stimulus of this new attempt is their power of aspiration encouraging them to aspire their Liberalist objectives which will never be compromised in any occasion. Without the power of individuals’ aspiration, no voluntary mind and movement will take place to attempt to establish the unknown ideal. This shall be the condition for the further progress of material and the endeavour to spiritual prosperity.