Justice & Protection in Limon

Nearly twenty years ago I was asked to help create an independent justice system for a province of Costa Rica that hoped to become autonomous. And so I put together a plan, working at least a little with the modern pioneers in this field, Bruce Benson and Alvin Lowi.

The project never came to fruition (none of them from those days really did), but it allowed us to stretch our intellectual wings and to do serious work of a unique and otherwise unavailable type.

This is a paper I produced for a highly regarded economic association and delivered at their annual meeting.

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The Limon Real Project is an effort to create an autonomous region in the Costa Rica. In particular, to separate Limon Province, in all but name, from the remainder of Costa Rica, and to allow its people to exist independently from almost all interference from the central Costa Rican state.

My role in this venture is to assist in the creation of systems of justice and protection that can function effectively in the absence of centralized force. It has also fallen to me to explain how such systems operate, and to assuage (if possible) the fears of people who do not see a possibility that such systems can be effective.

It is important to specify that the plan for justice and protection in Limon is for a completely market-provided solution. Let me reiterate–not managed, not regulated, not overseen–a free market solution. This means that, if the Limon Real plan is implemented, the Costa Rican government will hold no exclusive position, including no ability to impose taxes, penalties, or to command obedience. If they wish, the Costa Rican government can keep their courts and judges, but they will not hold any monopoly on justice or similar types of services. Anyone who wants to enter this market will be free to do so. These will be for-profit firms, selling justice provision.


The concept of non-monopolistic justice strikes most people as radical. In common parlance, it scares the hell out of people. For many reasons, most people hold the Hobbsian image of a world without state–where we all degenerate to irredeemable thieves and murderers, and where life is “nasty, brutish, and short.” No matter how well people such as myself may provide evidence to the contrary, a great number of people are simply unable to consider them fully. Their mental image is that of a world divided into states, as if God Almighty had so decreed. The State: That which is, was, and ever shall be.

For a number of years, I have argued that a world without state was not only possible, but preferable. A certain number of people are open to such a possibility, but others feel an instinctive need to defeat any such idea. To propose such an idea is to at once be subjected to a thousand questions. Questions asked, not in hope of an answer, but for the person asking to convince his or herself that such a thing cannot be. And, it gets worse from there. Answering such objections tends mostly to anger them. The more intelligent and creative can keep presenting ‘what-if’ scenarios endlessly, and the less creative simply hate you. This is a psychological issue, rooted in cognitive dissonance, conditioning, and fear of the unknown. Handling objections to the concept is seldom an intellectual exercise.

As an exercise, I propose the following (if you dare): Familiarize yourself with the non-state argument, then take it to a cocktail party. Present these idea to people that are normally considered cultured and intelligent. I think you will be enlightened by the results. However, I suggest that you do it somewhere removed from your home base–else it could negatively affect your livelihood. There is a massive emotional gradient against non-state systems. This is so deeply and ubiquitously woven into many people’s psyches that they don’t even know why they so passionately and desperately oppose such an idea. They feel that such a thing must not be allowed to exist, or even to be discussed.


But in spite of all this, there is a very serious argument to be made that both justice and human interaction in general work much better without controlling monopolies. Monopolies don’t work well in any other areas of life, why should they here? Non-monopolistic systems of justice can operate quite well; they will just have to be arranged differently.

Justice is an essential, valuable commodity; people will pay for it. And in the Limon scenario, they will be free to choose the best provider for their money. This arranges all of the feedback mechanisms to operate the right way. With such incentives and feedback mechanisms in place, excellence is produced. This is just as true for law as it is for the provision of other services.

Law, freed from centralized force has worked, and does work. The prime historical examples of this are, in my opinion, the Lex Mercatoria, Jewish Law, and, to a large degree, the early Common Law. (Others have argued persuasively that medieval Icelandic and Irish law provide excellent examples, but my expertise on such matters is minimal, so I do not expound on them.) In contemporary times, there are good examples in the diamond trade, commerce in non-jurisdictional cyberspace, and many others. Even our modern arbitration systems, which are loosely attached to monopolistic authority, work much more efficiently than the standard legal methods, which are tied rigidly to monopolistic authority.


Any sort of law that is to work in the absence of a central authority (enforcer), must be based on principles of natural law, rather than on what might be called “statute law.” Principles of natural law are easily understood by all men, and require no special training.

For simplicity and clarity, we will state the natural law rests on the presupposition that any healthy human has a basic understanding of equity. This was always the foundation of natural law. In such systems, one does not make a law–one merely analyzes a case or situation to discover what would be just under the specific circumstances. In more modern terms, we would say that natural law rests on the human faculty of self-reference. That is, the ability of humans to say, “If someone stole my food, that would be very bad for me. So, if I were to steal my neighbor’s, he would be as hurt as I would be…stealing would make me bad.” This is why the better systems of law and the more enlightened religions have always championed integrity. (“Out of thine own mouth will I judge thee.”)

Statute law, on the other hand, rests on a foundation of force. Laws are made by the strongest entity, and disobedience is punished.

These are radically different bases. Natural law is a system of principles, whereas statutory law is a system of rules. Natural law does not demand obedience to a master, though it does demand that the individual act with integrity. This has deep psychological implications, since integrity is a function of self-acknowledgment, whereas obedience is a function of self-denial.


This is always a difficult issue for proponents of statute law, but most people respond amazingly well to natural law. Beginning with “all men understand what is just,” almost everyone exercises their minds in the contemplation of justice.

While I no longer have the proper reference at hand, there was a wonderful example of this in the early American colonies. For a long period of years, Blackstone’s Commentaries on the Common Law was an enormous best-seller. This was at a time when centralized authority was loose at best. In recent years, we had a very similar situation when we published The Common Economic Protocols. The Protocols are a set of common law principles designed to be the central statement of law in non-jurisdictional cyberspace. Upon publication, the Protocols became a much-discussed topic. People reviewed them, analyzed them, registered commentaries, and adopted them for commercial use. And this interest was not from lawyers and academics, but from programmers, artists, and college students.

A further argument for natural law appealing to common people is the popularity of Television Judges. It is not primarily educated professionals who spend their time watching these shows. It is obvious that the viewers of these shows enjoy analysis of right and wrong. Natural law makes this possible. It seems that many of these viewers are looking to spend some time thinking about something that matters; something more substantive than their usual diet of pre-digested entertainment. And, while mentioning entertainment, please consider the fact that nearly every action hero in a movie has a base assumption of natural law, not statutory law. The hero routinely breaks the rules, and ends up saving innocents from harm in the process. “Screw the rules, save the people,” would fit very nicely in the mouth of Bruce Willis.


Please try to believe that I am not overstating when I say that natural law is the great teacher that produces free societies.

In a natural law setting, every man is responsible to make his own judgments of right and wrong, and is accountable for doing so. This powerfully affects the development of the human character. Under statute law, it is obedience to authorities that keeps you safe and prosperous. Under natural law, developing and using your own judgment is what keeps you safe and prosperous.

Statute law imposes a set of negative incentives that discourage independent thought. In such situations, the individual’s analysis of right and wrong is of no value and of no use. It is the lawmakers who decide such things, not you. Your judgment is not important, theirs is. People conditioned to statute law tend toward a withered sense of judgment and self-trust. And if suddenly the authority is removed, they are lost, and are easily led by anyone appearing to be the strong new ruler.

People generally conform, over time, to the incentives that they face. Only very strong minded and principled people can stand against such continuing incentives. Where strong principle is lacking, incentives play the central role in the formation of human character. Incentives that encourage independent judgment and analysis are much healthier than incentives that discourage these things.

Human life is hugely complex, and any set of rules attempting to define proper human action would be so incredibly long that no one could have a hope of knowing all the rules. Principles are knowable and usable; rules are endless and rigid. People who follow principles use reason and independent judgment to apply those principles. People who follow rules use reason narrowly and rigidly. Essentially, referring to principles activates the mind, and holding to rules causes the mind to constrict.


No matter how perfect a system of non-monopolistic justice may be, it must also be trusted and used. In short, it must be accepted by the purchasers of justice services. Toward that end, there are two primary issues: First, that the purchasers must understand the product; and, second, that they perceive it as superior to competing products. It should be added that in this case, it must also be explained to the purchasers that they must now pay for these services, whereas in the past they were provided “for free.” The explanation must be made that they will no longer be paying taxes, and that now they must purchase protection. This is not a difficult point to make, but it is unusual.

As mentioned in the previous paragraph, any new system of justice and protection will be compared by potential purchasers to the existing Costa Rican system of justice. We believe that it will compare favorably. Costa Rican justice does not operate terribly well. Firstly, Costa Rican law is built on the French model. There is no common law base, there are no juries. An individual may be imprisoned for months or years without a hearing. In addition, the machinery of justice moves very slowly in Costa Rica. In December 2002, I had a meeting with a leading Costa Rican congressman, and was informed of the following required times to reach a legal judgment: Labor disputes, minimum 4 years; family issues, 4-6 years; a civil matter, 10 years; administrative matters, 12-15years; commercial collections, 4 years; appeals, 2-4 years.

The congressman also informed me of the following, regarding the familiarity of the Costa Rican people with alternative systems:

  1. All of the nation’s football (soccer) leagues are governed by a non-state system. The football leagues make their own decisions, and no disputes, including contract disputes, are ever taken to the national courts. If this was attempted, the persons taking the case to the courts would be permanently expelled from the football leagues. The rulings of the football leagues are followed explicitly, backed very effectively by ostracism.
  2. The Talamanca Indians in southern Costa Rica have their own, separate system of justice. The operation of this system, which is widely known throughout Costa Rica, is fairly close to the arbitration model, if I understand it correctly.
  3. The Costa Rican construction industry relies heavily on American-style alternative dispute resolution; primarily arbitration.


The promoters of the project will be involved with promoting private justice in Limon. We will not have control over justice providers, but we will prepare the marketplace prior to opening the doors of commerce for justice services. In particular, we plan to do the following:

1. To bring in competitive providers of protection and adjudication, centered on the common law. (We expect these to be contracted by each neighborhood, on the private policing model.) We want to start with several responsible, professional providers. We will have no control over the marketplace once we open it, so we want to seed the market with quality providers.

2. Create a ‘cross-jurisdictional’ (provider-to-provider) court. Again, we will not be able to force anyone to use this service, but we will make sure that it is in-place, and that it has strong ties to the justice providers.

3. Establish a Justice Provider’s trade organization. The central purpose of this association will be to certify the competency of justice providers.

4. Publish principles of common law (on the pattern of The Common Economic Protocols) and Rules of Procedures (perhaps from those originally assembled by Michael Van Notten). Not only will these be published, but they will be distributed very widely, and explained to the residents of Limon at considerable length.


Freedom and The Law, Bruno Leoni, Liberty Fund

Limon REAL, Rigoberto Stewart, Institute for Liberty and Policy Analysis

The Common Economic Protocols, Andre Goldman, et al.

The Enterprise of Law, Bruce Benson, Pacific Research Institute for Public Policy

For a New Liberty, Murray Rothbard, Fox & Wilkes

The Market For Liberty, Morris and Linda Tannehill, Fox & Wilkes

The Private Production of Defense, Hans-Hermann Hoppe, Ludwig Von Misses Institute

The Structure of Liberty, Randy Barnett, Oxford University Press

To Serve And Protect, Bruce Benson, New York University Press