Sunday, April 12, 2009

Piracy: The Free Market Solutions

What did the captain and crew of the Maersk Alabama have in common with the victims of the Binghamton murders?

Both were unarmed and defenseless against evil.

In the Binghamton case, this probably had to do with the fact that government offices, such as immigration services centers, tend to be no-gun zones. In the case of the commercial ship, the reasons are more complex.

Jane Jacobs told a story in a brilliant book years ago that is very much to the point here. During the Middle Ages, she says, the rising merchant class of the island nation of England found that to really prosper they had to cross the seas to conduct trade in other lands. But the seas were swarming with pirates, and they lost ships and treasure. But they found a solution. Pooling their resources, they built a flotilla of armed ships. Then they gave the ships as a gift to the king, with the request that his men go out and clear the seas of pirates.

Why, having the resources and the ships, didn't they themselves go out and kick pirate butt?

There are at least two sorts of reasons. First, trading and fighting force with force are two very different skill sets. The solution to the problem of the Maersk Alabama is not to say to the crew, "Here, have some guns!" They are not trained in their safe and effective use. There are indeed a number of reasons why they don't want to be so trained.

As Jacobs points out, traders and professionals in the use of deadly force follow moral codes that are profoundly different, and they generally do not mix very well. Trade is based on on a respect for human rights -- the main ones involved admittedly are property rights, but they are rights nonetheless. To trade valuable goods with a complete stranger who is armed would mean worrying about whether he might just kill you and take your goods for free. If the Maersk Alabama had been armed, there are ports in the world that would not have allowed it to dock. Its mere presence would constitute a security risk.

What is the alternative to do-it-yourself security? There are plenty of people who are saying that the only long-range solution is to go in and "fix" Somalia. I think these are the same people who "fixed" Iraq, Afganistan, and Vietnam. Remember them? I think such people are much more dangerous than the pirates. If they have their way, they will take far more lives and destroy far more treasure. Come to think of it, they already have.

But there is a third way. For a fee, private firms who specialize in protective services, will protect your ship. Depending on the policy you purchase, they may put armed guards on your ship or, if for any number of reasons you don't want to do that, you can take out a fancier and more expensive policy and they will escort you with a convoy of armed boats through pirate infested waters. The latter sort of policy would solve the unable-to-dock problem. You can rendezvous with your guard boats at a pre-arranged point and part with them after passing through the dangerous waters, at which point their check will presumably be in the mail.

Like everything else in life, the third-party security alternative has both positive and negative aspects. But with time it may prove far preferrable to both alternatives: either continuing to count ransom and pirate violence as an expense of doing business, or allowing liberal imperialism to shove us into yet another political black hole in the Middle East.

Either one of the main free market solutions have one big advantage over any government solution: They will be paid for by the people who benefit the most from them. And they will be paid for if, and only if, they are worth the cost. And that's something you sure can't say about Vietnam, Iraq, or Afghanistan.
Added later: I just found this on the web (hat-tip t o Lew Rockwell):

Here is an article in Politico about Rep. Paul's proposal.
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