In the last post, we discussed the first paragraphs of chapter 11 of Murray Rothbard’s For A New Liberty. (available free from Mises.org as pdf, web page, and audio book) Those paragraphs discussed the private ownership of all land, including streets and roads. Rothbard clearly and concisely argues that private ownership of streets would result in safer public spaces.
Discussions I have had with people often lead to the topic of forestalling, in which a sinister land owner decides to completely surround a neighbor’s property, preventing him from using it. This valid concern can be eased through a principled analysis of such a situation:
At this point in the discussion, someone is bound to raise the question: If streets are owned by street companies, and granting that they generally would aim to please their customers with maximum efficiency, what if some kooky or tyrannical street owner should suddenly decide to block access to his street to an adjoining homeowner? How could the latter get in or out? Could he be blocked permanently, or be charged an enormous amount to be allowed entrance or exit? The answer to this question is the same as to a similar problem about land-ownership: Suppose that everyone owning homes surrounding someone’s property would suddenly not allow him to go in or out? The answer is that [p. 204] everyone, in purchasing homes or street service in a libertarian society, would make sure that the purchase or lease contract provides full access for whatever term of years is specified. With this sort of “easement” provided in advance by contract, no such sudden blockade would be allowed, since it would be an invasion of the property right of the landowner.
A likely solution to this issue of forestalling, would be the emergence of “access insurance”. This would be similar to title insurance, which is a system that emerged as a result of the United States system of document recording “in which no governmental official makes any determination of who owns the title or whether the instruments transferring it are valid.” The US system seems anarchic, but the Title Insurance system emerged through the marketplace.
Such a system of “access insurance” would likely emerge to become as universal as the title insurance system, and likely be required by lenders. A buyer of a property would purchase insurance to ensure that access to the property would not be denied by any parties. If some neighbor decides to invade the property rights of the insured by blockading him in, the “access insurance” company would have to compensate the policy holder for the full value of the property (or other amount insured). Thus, the heavily capitalized insurance company has every incentive to use its vast resources to prevent such an event from occurring to defend the property from blockades.