If small groups are indeed the practical ideal for achieving functional, consent‐​based mutual aid, we might reasonably wonder how we arrived at today’s paternalistic, centralized federal bureaucracy. The modern welfare state, particularly in the American context, was born in large part as a project of social control, social engineering, and social sanitization, predicated on fundamentally nativist, racist, and eugenicist ideas about what it means to have a strong, coherent nation‐​state. 3 No less than so‐​called “right” libertarians, “left” libertarians have stressed the hostile displacement of voluntary self‐​help through friendly societies by the steamrolling totalism of the modern nation‐​state. Confronting the argument that anarchism’s anti‐​statism is obsolete given the modern state’s role in providing social welfare, Colin Ward points out that social welfare “did not originate from government.” Social welfare, it would seem, furnishes another example of the state uprooting and crowding out the spontaneously emerging innovations of cooperative society—only to turn around and congratulate itself for rescuing the poor with its own programs. As David T. Beito observes in his book From Mutual Aid to the Welfare State , advocates of the existing fraternal societies saw the paternalism of the emerging expert class for what it was, noting, “The application of their doctrines usually has led to oppression and bloodshed.” Bottom‐​up, decentralized mutual aid societies, directed by the users who draw their benefits, were (and remain), of course, a rival to the totalizing power of the modern state. Early progressives were, in fact, quite explicit about their desire to snuff out any social organization seen as challenging total “loyalty to the state.” 4 Today’s progressives, though they maintain the same ideological fundamentals, have had to repackage the bureaucratic welfare state in the language of care, compassion, and charity.

Such language reflects a patronizing attitude at the heart of the modern bureaucratic welfare state, an attitude that prevents us from thinking more carefully and accurately about the role and purpose of a social safety net. As Samuel Hammond correctly notes, “the metaphor of social insurance as a public form of charity is a deeply misleading one,” as insurance is a mutually beneficial agreement, not a form of philanthropy. Hammond highlights the example of Social Security, but the point is no less applicable to food stamps, unemployment insurance, and other such programs. Staying with the example of Social Security, there is, in principle, no reason why the government should be better able to provide this kind of insurance service, unless, of course, government is in fact not simply acting as an ordinary insurer would, but is able, by the sheer exercise of arbitrary power, to continue a broken scheme long after it has revealed itself as insolvent. Put another way, even assuming we grant the premise that life annuities of the kind represented by Social Security are subject to a market failure, there’s no ready path out of this failure for governments. Thus, while it may be “more precise to think of it as a form of insurance,” Social Security is not insurance under any of the definitions we would ordinarily assign to that term, all of which exclude the government’s fraudulent system. 5 If private actors (insurance companies and employers) face incentives insufficient to provide adequate market options for pensions and life annuities, then, ceteris paribus, governments are bound to behave similarly, being no less operated by human beings. Governments are only different in that they can violently compel people to do things we are told they would otherwise not do—things they supposedly don’t have the incentives to do. 6 But, again, if people are people, and governments are without magic wands and silver bullets, then we have to grapple seriously with a seeming absurdity: people are not sufficiently rational (perhaps because they’re too shortsighted or they’re naively optimistic, etc.) to provide themselves, on a voluntary basis, with pensions and life annuities, but government actors, a comparatively small group of people possessed of a unique power to compel obedience and lacking in any similarly situated competition, will have all the incentives they need to provide a superior, workable system for the entire citizenry. Faced with questions about a social safety net, libertarians are frequently accused of hand‐​waving, lazily falling back on the ideological insistence that markets will somehow simply take of the subject problem. But is there any position more reliant on insubstantial hand‐​waving than holding state actors above or outside of all the assumptions economists and social scientists make about human behavior? Forget, for a moment, terms like “market,” “market failure,” and “government”; here, the phenomena we are actually discussing are human beings and the myriad ways in which we can behave toward one another and provide for our needs. We should take care, at this juncture, to emphasize that the problem with the modern welfare state from a libertarian perspective is not the mere fact of wealth redistribution; insurance, by definition, entails the redistribution of wealth according to the terms of its policies, agreements between insurers and insureds. Rather, the problem is the paradoxical idea that the introduction of arbitrary compulsion is able, apparently alchemically, to augment the rationality of the people who use it, agents of the state, and their plans for us, enabling them to provide a more efficient system than people could provide for themselves if left to their own devices. Everyone, regardless of her politics, should greet this idea with a level of skepticism, for it is quite a strange and ambitious claim.