Former “Seasteaders” Come Ashore To Start Libertarian Utopias In Honduran Jungle
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Forgoing the plan to build independent floating cities away from chafing laws, some libertarians–led by Milton Friedman’s grandson, no less–have found something better: desperate countries willing to allow the founding of autonomous libertarian cities within their borders.The seasteader-in-chief is headed ashore. Patri Friedman (that’s Milton Friedman‘s grandson to you), who stepped down as the chief executive of the Peter Thiel-backed Seasteading Institute in August, has resurfaced as the CEOof a new for-profit enterprise named Future Cities Development Inc., which aims to create new cities from scratch (on land this time) governed by “cutting-edge legal systems.” The startup may have found its first taker in Honduras, whose government amended its constitution in January to permit the creation of special autonomous zones exempt from local and federal laws. Future Cities has signed a non-binding memorandum of understanding to build a city in one such zone starting next year.
Seasteading, i.e. the creation of sovereign nations floating offshore, is enshrined in libertarian thought as an end-run around the constraints of stodgy nation-states. The idea has received plenty of (mocking) mainstream coverage, most recently in a Details profile of Thiel, in which Friedman outlined the new startup he had in mind:
One potential model is something Friedman calls Appletopia: A corporation, such as Apple, “starts a country as a business. The more desirable the country, the more valuable the real estate,” Friedman says.
Future Cities follows this approach, describing its mission as bringing “Silicon Valley’s spirit of innovation to the implementation of cutting-edge legal systems in new cities,” most likely in the role of the cities’ master developer. Citing laissez-faire entrepots such as Hong Kong and Singapore as examples, the company’s founders believe that strong property rights and business-friendly regulation are key to creating jobs, stimulating investment, and lifting millions out of poverty, a la China’s special economic zones. “The evidence is much stronger,” Friedman replies when asked if he’s building another libertarian utopia, “that rule of law, fairness, and a lack of corruption leads to more economic growth than low taxes.” (Not that they’re mutually exclusive, as Singapore demonstrates.)
Instead of seasteading, Future Cities is modeling itself on “charter cities.” The brainchild of New York University economist Paul Romer (read his thoughts on FCI here), a charter city combines a host nation’s vacant land (in this case, Honduras) with the legal system and institutions of another (e.g. Canada) and residents drawn from anywhere. Romer’s central insight is that good governance is transplantable–rather than wait for a basket case nation to come around begging, a charter city could help show it the way, as Hong Kong did for Deng Xiaoping.