Reason has delved recently into various arguments for where libertarians' political energies are best aimed, both in our August-September cover story (in which Brink Lindsey, Jonah Goldberg, and Matt Kibbe hash over the appropriateness of the modern right and Tea Party movement as a libertarian berth) and in my follow-up in which I suggested libertarians' educational mission still has a long way to go before meaningful political alliances are worth thinking hard about.

Some libertarians, though, are concerned with neither standard politics nor educational missions. The larger libertarian movement has always had members who just want to create as free a life for themselves as they can in a statist world, whether through such expedients as black market countereconomics, survivalist escapism, or, in the most recent and best publicized example of what is sometimes called "libertarian Zionism," heading for the high seas in artificial floating countries. That's the goal of the Seasteading Institute, which I profiled in Reason magazine back in July 2009.

The weekend before last, I attended what was essentially the second annual Ephemerisle festival, the attempt by the Seasteading Institute and its supporters to gather on the water in an atmosphere of fellowship and fun, and begin working out the theory and practice of unregulated aquatic living. (I wrote about my experiences at the first Ephemerisle for Reason Online last October.)

This year, the Seasteading Institute backed out of an official role in organizing or selling tickets to the festival when they found the costs of insuring it prohibitively expensive. (They did it sans insurance the first time, but decided it wasn't prudent to repeat that experiment. They are hoping to work out an affordable plan for next year's planned festival.) But a meeting place and time had already been decided on, and plans to have a get-together that weekend were already made, so what was called by different people at different times the "Floating Festival," (Un)Ephemerisle, and "Schmeschmemerisle" happened anyway, without any official imprimatur, out on the Sacramento River Delta.

This year, no communal floating platform space was provided, and without art grants from the organizers, very little in the way of originally created art was there. But the Seasteading folk helped finance the purchase of a barge to be recommissioned into a multipurpose living and showboat by Chicken John Rinaldi, the San Francisco showman and builder (and former mayoral candidate) who had designed and supervised the building of the communal platform for Ephemerisle last year.

Getting that boat sealed, refinished, and functional took a handful of people three weeks of work. I joined the crew at a berth in Bethel Island Friday afternoon for the final frantic 24 hours of painting and decorating, wiring, installing the Mercedes engine that hung off the stern of the boat to propel it, extending the hull back up a bit to replace the parts that had to be cut away to hang the engine (carpenter Marc Roper treaded water for hours doing the woodwork from the outside), and finally sailing it slowly to rendezvous with the rest of the Seasteaders, who had all rented houseboats from a nearby marina. (One intrepid fellow who flew in from England repurposed bits of a homemade floating platform from last year, making it the only non-bought floatation solution at this year's event.)

Anton Berteaux, the main engineer on the project, described the propulsion: "It's a five cylinder turbo diesel engine from an early 80s Mercedes 300td. We are using the automatic transmission that it came with, with a long structure sticking off the back to support the driveshaft with the propeller on the end of solid stainless shaft off the end of that. It sits on a '5th wheel' trailer hitch, which is a miniature version of the hitch on a semi truck, which has a swiveling table that catches a pin that allows rotation." Steering it tightly was the work of three men, one standing between the two long handles, and one on either end pushing or pulling. (For less severe maneuvering, one strong and tireless man would do.)

The trip was adventurous, and certainly helped explain why renting a ready-made solution like a houseboat was preferable to the DIY model; if Ephemerisle teaches you anything about seasteading, it teaches you that trying to create fresh solutions to the problem of moving and living on the water is really time-consuming and difficult. The ship, dubbed The Relentless, hit a pylon under a bridge about 10 minutes in, gashing a two-foot slice in its hull, luckily well above the waterline, and dashing helmsman Jimmy Cross to the deck. At one point during the seven hour trip out to the festival, the engine was inoperable, we were stuck in the reeds, taking on water, and on fire. (It was a small and easily managed fire, luckily.)

We eventually arrived to find the row of other anchored houseboats after midnight on Saturday, and performed our showboat function with a trapeze performance by Miriam Telles off a post carpentered to the deck at the very last possible minute, and a musical performance by Jason Webley. The warm darkness, suffused with a full moon; the water's mysterious and constant shifting and lapping; haunting expressions of human skill and storytelling: It was glorious, it was fun, and it was not political.

The rest of the entertainment was wandering from houseboat to houseboat meeting and greeting; giving or listening to mini lectures on the "Memocracy" houseboat; taking trips out on the water in speedboats or homemade catamarans (on one of which I received a sailing lesson from a man I was later told was intrepid long-distance homemade sailor Tim Anderson), and conversing. Nearly every conversation I overheard or joined seemed connected to the worlds from which most Seasteaders seem to derive: computers, high-tech geekery, futurism, and of course libertarianism. I overheard speculations about how to more efficiently create interesting video games, robot fisherman, and the like. Matt Bell, who hosted the lecture series, identified the topic range as including "life extension, telepresence robotics, education, human rights, social networks, and seasteading."

That a cancelled event managed to attract as many people as the official one the year before—around 120—is encouraging about the passion and attraction people have to the idea of Seasteading; but that's still many long steps away from actual floating polities in the sea. Seasteading Director of Operations James Hogan says he thinks about two-thirds of the attendees this year were attending their first Seasteading-related event.

Like last year, frays in the social fabric arise when the libertarian minded are forced into a situation that requires some communal decisionmaking and behavior. This year's hubbub arose when a late-arriving houseboat was initially set up in front of another boat rather than joining the line, temporarily angering the folk whose view was suddenly marred. (The offending boat eventually joined the rest in line.) Unlike the first Ephemerisle, in which the whole community was essentially tied to shore, this year the line of houseboats succeeded in anchoring themselves in deeper water, though they eventually had to cut loose three anchors when they couldn't raise them successfully in time to return the houseboats before another day's rental would kick in.

After the event, I asked Seasteading's chief, Patri Friedman, to assess the state of Seasteading. He confessed that they had had a rough year so far; he's burning himself out fundraising, and the cancellation of the official Ephemerisle weighs on him. But he's excited that they are on the verge of hiring a director of engineering to work on the technical problems of maintaining a permanent structure on the ocean. They are now leaning more toward using existing ships as a base for what they are now calling "the Poseidon Project," the first actual functioning international water seastead, rather than building one from a new platform design. Peter Thiel, the Paypal co-founder who has been Seasteading's primary financier, has offered a matching grant of $250,000 this year, and they have already gathered 60 percent of that. What's one thing Friedman has learned about what are not rich sources of Seastead donations? "Libertarian conferences, and students, are not good for fundraising. They are fun groups to talk to, they like me and I like them, but…" Friedman hopes to move Seasteading into the position to get more funding from varied foundations, both libertarian and ones dedicated to social entrepreneurship in general.

The Seasteading Institute has added a new director for commercial development, Max Marty, a fresh MBA from Miami who discovered Seasteading at a Singularity conference and then later at a meal found himself expressing his excitement about it to a stranger who turned out to be James Hogan. Marty was impressed, at his first water festival, at the joyous camaraderie and excitement it generated. He also realized that having the inner circle of Seasteaders brainstorm about business ideas appropriate for a Seastead isn't good enough, so in a crowdsourcing fashion they've launched a contest with $5,000 in prizes to come up with viable business plans especially appropriate for one.

The floating ocean platform that is, alas, now most familiar to the world is the Deepwater Horizon; Marty thinks the BP disaster could end up as a boon to the larger idea of permanent seasteads, predicting that one dedicated to environmental science, sustainability, and research might be a good idea for extraction industries to fund themselves given their current P.R. troubles.

Despite the framing of the Seasteading project by the likes of Alternet as motivated entirely by a venal and cowardly desire to escape the real business of civilization (after destroying it with their capitalism, natch), Seasteading's Hogan reminds me that the project has the potential to do more than provide a refuge for libertarian malcontents.

The very existence of seasteading, goes the theory that animates Friedman and his colleagues, will add a new competitive element to governance on Earth and make, ideally, the whole world a better place. "I don't want to live on a Seastead," Hogan says. "Maybe when there are several million people living on one, with all the amenities of a modern city. My inspiration and excitement about the project is to make the governance market more competitive and affect all societies most profoundly. This is a deep way to try to leverage social good on global scale, to get down to the incentives that give rise to governmental systems and introduce more profound competition."

"We don't want to just change a political system," Hogan says. "We want to change the industry of governance itself that gives rise to political systems. Seasteading will lower barriers to entry [in governance] and reduce the cost of customer switching." If it works, the effect will be as salubrious in terms of customer satisfaction as the ability to enter and switch is in any other industry. In escaping normal civilization, libertarians could find out that their true place is bringing to politics the key benefit of free markets: wider and freer competition and the quality that comes with it.

Senior Editor Brian Doherty is author of This is Burning Man (BenBella), Radicals for Capitalism (PublicAffairs) and Gun Control on Trial (Cato Institute).