Questioning Hoppe's Premises

The last argument presented against Hoppe's argument about democracy takes the form of assuming Hoppe's premises and demonstrating that they still don't necessarily lead to his conclusion, because even if we assume that the monarch does have a low time preference, this still doesn't prove that their treatment of their subjects will necessarily be more reserved or benevolent. A low time preference ruler is still a ruler, and them having a low time preference merely means that they will seek to maximize their inputs that they reap from the productivity of their subjects in the long-term - it's to treat the subject and the state as an investment.

But the problem with Hoppe's argument runs deeper than this, to the core of some of his assumptions. Does it really follow that just because something is an individual's "private" property, they will necessarily treat it better? I understand the typical use of tragedy of the commons by economists to argue for something along these lines by portraying more common ownership as leading to over-use of resources. But there is nothing about "private" ownership that inherently tends towards the opposite, especially if a "private" owner can externalize their costs. Why couldn't an individual owner "use and abuse" to a fault as well? They very well could.

Hoppe seems to assume that contemporary democracies actually are a commons, and in this sense he is buying into the democratic myth in his own attempt to argue against it. But let's be clear about this: even democratic states are, in some sense, still "private" institutions, they just have somewhat of a more inclusive membership than monarchies. They are still "private" oligarchies relative to the general population. Instead of having a single family or individual that owns the state, the state is effectively owned by a number of different families and a small oligarchy, who are more or less allied with and function on the behalf of pockets of "private" investors in "the market". It's almost as if the "democratic" state is a corporation, with a board of managers representing investors.

The historical reality of monarchies also flies in the face of Hoppe's premises. There are endless examples of monarchs being expansionist and using their power in extreme ways without any meaningful checks. Hoppe's unspoken assumption is that the monarch will be knowledgable about economics or a wise investor. But just because there is a "private" owner of the state does not necessitate that they will have a low time preference. This is particularly true considering the factor of inheritance. An inheritor can't even claim to have "earned" what they own in any meaningful sense, and hence in fact do not tend to treat it as if it was something that they worked for. It's theirs to "use and abuse" regardless.

There is a wiff of the "homo economicus" in this notion of monarch-as-wise-investor. People do not function solely on the basis of economic incentives. If someone is determined enough to pursue a given goal, they will try to pursue it regardless of how unwise it might be from a purely economic standpoint. In turn, if a king is determined enough to exercise power, they will excersize power even if it isn't the best course of action from the standpoint of being an investor in the state. Kings are not economic calculation automatons that are always working hard to maximize capital values. Just like any other ruler, the internal institutional incentives are for the perpetuation of the institution itself and the maximization of power.

Hoppe greatly underestimates the particular dangers of unilateral power. He essentially assumes that unilateral power is preferable to multilateral power because the unilateral decision-maker doesn't have to have their alleged economically-minded meanderings distracted from by other agents. But, if anything, this is a peculiar danger in monarchies: that the monarch has little to no multilateral checks on their power, and can therefore excersize it more easily and directly. This is the counter-point or downside to monarchy that isn't taken into account at all by his analysis. While a democracy at least tries (and, of course, fails) to separate powers so that a single individual or party cannot have all of it concentrated in them, monarchy doesn't even function on the pretense of trying.

Monarchy is, in fact, the most centralized form of government in this sense. It is only the most "small" form of government in the sense of its membership, while this exact same "smallness" is precisely where its power lies in terms of being densely concentrated in a certain spot. While democracy attempts to internally mimick decentralization, monarchy most blatantly places "ultimate decision-making power" in the hands of a single individual. It really shouldn't be too hard to see what might be particularly dangerous about a single individual having "ultimate decision-making power", yet Hoppe apparently thinks that it is a "lesser evil" than a system that attempts to place barriers to unilateral decision-making!