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Gambling Questions for Fellow Rothbardians?

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RothbardsDisciple Posted: Tue, Sep 13 2011 6:56 PM
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I was talking to another Libertarian about how contracts cannot always be enforced, if to do so would initiate Aggression. He then brought up the example of gambling:

"Under this, gambling should be illegal since you promise to pay Amount X depending on Event Y. If Event Y doesn't happen, I don't have to pay you anything... too bad if I signed a contract agreeing that I would pay if Event Y occurred... I didn't initiate aggression on you, so you can't do anything me."

And I said:

"Gambling wouldn't be illegal, per se...but what you said is true. Though the ass who did that could be ostracized.

I'm pretty sure there would be Libertarian solutions to this though. For example, pooling the winnings to a reputable third party before the event, who will then dole it out to the winner? There's lots of other secure ways this could be done."

What do other Rothbardians think about this? What other solutions might you propose, asides from Initiating Aggression against the gambler who non-aggressively opted out of the contract?

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Nielsio replied on Tue, Sep 13 2011 7:45 PM

This is why the whole notion of blanket non-aggression is confusing. What matters is the specific system of property that you support.

All political systems have a different meaning of non-aggression. Just saying non-aggression is not enough.

In this case, you've entered a trade that is dependent on an event. It means you've already given it up, and may receive some, none or more of it back. Not following the contract would be a violation of the libertarian property system.

The real question is: which system of property is the one that we want to support?

 

On Morality and Utility (by Daniel James Sanchez)

&

Why Liberalism (by DJS)

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hashem replied on Tue, Sep 13 2011 8:42 PM

I read a lot of Rothbard and I don't see the problem here...

It's not "too bad" if he signed a contract. It's precisely the contract which proves you now own (or he now owes you) Amount X.

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Well, I'm absolutely not a contractarian. To enforce this contract against a man who has not Initiated Force, would itself be an Initiation of Force. Rothbard very clearly explains this in Chapter 2, Section 13, of Man, Economy, and State. If the man had frauded (stolen) from the other man, then of course the man who has been frauded could use Retaliative Force. Only actions of assault, theft, or slavery justify Retaliative Force; and the Retaliative Force must be roughly equivalent to the original crime. But in this case, B has not been frauded by A's fundamentally non-violent (though dickish) action of not paying his bet. Initiating Aggression is always Immoral, and Morality, of course, is an objective concept. To say elsewise is, quite frankly, absurd and base.

The contract system, by its very nature, is not always Libertarian. To claim that because a contract stipulates that Aggression can be used, Aggression legitimately can be used, is to deny the very inalienable will of of man.

Your notion is confusing, not that of our Great Professor.

 

@hashem- Really? Rothbard clearly disproves that in his example of the movie actor, in Man, Economy, and State. The Rothbardian cannot be a contractarian, per se.

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And for those of you who want to question my statements, what has the non-bet-payer frauded his opponent out of? What has he stolen?

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hashem replied on Tue, Sep 13 2011 9:50 PM

The Rothbardian cannot be a contractarian
You're confused. How much have you read by Rothbard? From the The Ethics of Liberty:

"The right of property implies the right to make contracts about that property: to give it away or to exchange titles of ownership for the property of another person...the only enforceable contracts (i.e., those backed by the sanction of legal coercion) should be those where the failure of one party to abide by the contract implies the theft of property from the other party. In short, a contract should only be enforceable when the failure to fulfill it is an implicit theft of property...where the failure to abide by the contract means that the other party's property is retained by the delinquent party, without the consent of the former (implicit theft). Hence, this proper libertarian theory of enforceable contracts has been termed the "title-transfer" theory of contracts."

Retaliative Force must be roughly equivalent to the original crime.
Are we talking about Rothbard? He advocates proportionality, not equivalence.

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Wheylous replied on Tue, Sep 13 2011 10:00 PM

 To claim that because a contract stipulates that Aggression can be used, Aggression legitimately can be used, is to deny the very inalienable will of of man.

Heart surgeons are the devil!

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"The right of property implies the right to make contracts about that property: to give it away or to exchange titles of ownership for the property of another person...the only enforceable contracts (i.e., those backed by the sanction of legal coercion) should be those where the failure of one party to abide by the contract implies the theft of property from the other party. In short, a contract should only be enforceable when the failure to fulfill it is an implicit theft of property...where the failure to abide by the contract means that the other party's property is retained by the delinquent party, without the consent of the former (implicit theft). Hence, this proper libertarian theory of enforceable contracts has been termed the "title-transfer" theory of contracts."

That's precisely what I was saying! What has the man stolen?

"Are we talking about Rothbard? He advocates proportionality, not equivalence."

I was using them synonomously. Yes, I know what proportionality is.

 

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Heart surgeons are the devil!

Ludicrous misinterpretation. Haha.

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hashem replied on Tue, Sep 13 2011 10:26 PM

Huh? Maybe it's me who's confused about your example. Is your example:

A and B make a contract that if A wins, B owes A money. Upon winning, B refuses A the money.

?

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A and B make a contract that if A wins, B owes A money. Upon winning, B refuses A the money.

Precisely right. B has not "implicitly stolen" from A in any way. For what has he stolen? His action not to pay A was fundamentally not theft. Forcing B to pay A, in fact, would be theft.

Similarly, if I agree to pay you $100, weekly, for the rest of my life, could that be enforced if I opt out? By proper Rothbardian contract theory, absolutely not.

By the way, that's why I said: we're not contractarians, per se. We are, I suppose, if there is implicit theft.

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Now, if I make a contract to trade you my puppy for your cat, and I give you the pup but you don't give me the cat, then that is fraud, i.e., implicit theft. Restitution of the contract can be enforced.

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hashem replied on Tue, Sep 13 2011 10:57 PM

if there is implicit theft.
I suppose it would be expected by any parties making a contract that they allow it to be enforced.

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I suppose it would be expected by any parties making a contract that they allow it to be enforced.

And that makes it implicit theft HOW?

At this point, you are disagreeing with the Professor, not me. To be implicit theft (fraud), there must be something stolen. In this case, nothing was stolen. To say that a contract can be enforced simply by its virtue of being a contract is Anti-Rothbardian. There must be an act of theft for the contract to be enforced. See the example of the pup and the cat above.

And I recommend you read the little part of MES (Chapter 2, Section 13) that elaborates on this. Focus on the example of the movie actor.

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Wheylous replied on Tue, Sep 13 2011 11:26 PM

If you consider gambling as a service, then it works out:

Baron Berkshire: Would you, kind sir, do me the favor of rolling a number higher than mine? I will give you five shillings for it

Lord Locke: Certainly my nice chap. And would you yourself do me the favor of rolling a die higher than mine? I shall sign over 5 shillings as well.

*Locke follows through on his service by throwing a higher die.*

*Locke must now be paid for a service*

I dislike anti-contractarian arguments because any contract can easily be infused with property or a service to make it "legitimate"

Edit: Alliteration is fun!

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Wheylous doesn't get my point. Of course you could be frauded for a service. See my example of fraud above:

Now, if I make a contract to trade you my puppy for your cat, and I give you the pup but you don't give me the cat, then that is fraud, i.e., implicit theft. Restitution of the contract can be enforced.

Is the same as:

Now, if I make a contract to trade you [cleaning your floor] for you [sweeping my porch], and I [clean your floor] but you don't [sweep my porch], then that is fraud, i.e., implicit theft. Restitution of the contract can be enforced.

Obviously, Wheylous. Doesn't at all change the point of my argument.

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Wheylous replied on Tue, Sep 13 2011 11:33 PM

Why not? It creates "legal" gambling, which you were trying to disprove.

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Why not? It creates "legal" gambling, which you were trying to disprove.

Because in the initial scenario there was no implicit theft. For who stole from whom? For a contract to be enforced, there must be implicit theft, as my friend hashem's Rothbard quote shows.

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Wheylous replied on Tue, Sep 13 2011 11:39 PM

Is there theft in my scenario?

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I believe so, since he frauded him out of a service. (Same as if I agree to pay some guy $5 for cleaning the floor and I don't).

So what? Doesn't change my original scenario.

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In my original argument, there is literally no stolen property or service.

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Wheylous replied on Tue, Sep 13 2011 11:53 PM

Your scenario is merely one with a badly written contract, then.

Imagine a scenario where a guy lifts random stuff for people who pay him.

If you are in front of him and pull out a wad of cash and point to a sofa and he picks it up and then demands payment, you are, you argue, within your rights to deny payment, as there was no explicit contract between you two. Why, you were merely pointing at objects and fanning yourself with money!

What you're arguing is that unless you have very specific contracts, people are not obligated to do anything. Either way, gambling could be legal, which is the point of this thread.

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Your scenario is merely one with a badly written contract, then.

Still a contract. That's why Rothbardians are not contractarians, per se.

If you are in front of him and pull out a wad of cash and point to a sofa and he picks it up and then demands payment, you are, you argue, within your rights to deny payment, as there was no explicit contract between you two. Why, you were merely pointing at objects and fanning yourself with money!

I never argued against implicit contracts/implicit fraud?

What you're arguing is that unless you have very specific contracts, people are not obligated to do anything. Either way, gambling could be legal, which is the point of this thread.

No, that was absolutely not the point of the thread. My point was to show that a contract cannot necessarily be enforced. Only if there's fraud. That's the Rothbardian point. 

A true contractarian argues nonsense like this:

   If A agrees to give B $50 on the morrow, and A opts out, B can get restitution.

   If X agrees to marry Y, and the contract stipulates that, if X opts out he owes Y $100000, then X can be forced to pay Y $100000.

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Wheylous replied on Wed, Sep 14 2011 12:10 AM

Then the whole concept of private law is thrown out of the window.

Plus, how is gambling not an implicit contract?

Furthermore, if you want to be a stickler, sure, I'll allow that even implicit property contracts are not binding, though I would note that anyone who refuses to follow through on such a contract would be much ostracized.

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hashem replied on Wed, Sep 14 2011 12:13 AM

And that makes it implicit theft HOW?
Because they contracted that B owes A if Y occurs. B contracts to transfer property (i.e. title to/possession of property, according to their terms) to A in event Y, Y occurs. The contract is evidence to third parties that B owes A. Neither B nor A need the physical contract, unless they expect it to be evidence to others.

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Then the whole concept of private law is thrown out of the window.

Not really? Rothbard wrote a whole book on the matter (Ethics of Liberty), and his argument is the support for mine. If you think my argument means that private law is thrown out, then that is an egregious misinterpretation.

Plus, how is gambling not an implicit contract? Furthermore, if you want to be a stickler, sure, I'll allow that even implicit property contracts are not binding.

Gambling can be an implicit contract: or an explicit one. And, where there is fraud, of course these contracts can be enforced. But, where there is not fraud, these contracts cannot be enforced. (Like my original scenario).

I would note that anyone who refuses to follow through on such a contract would be much ostracized.

Completely agree with that. In fact, they should be ostracized.

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Because they contracted that B owes A if Y occurs. B contracts to transfer property (i.e. title to/possession of property, according to their terms) to A in event Y, Y occurs. The contract is evidence to third parties that B owes A. Neither B nor A need the physical contract, unless they expect it to be evidence to others.

B has not stolen any property/service of A? That's what implicit theft means.

If I agree to pay you $50 tomorrow via formal contract, and opt out, that is NOT implicit theft. Same for this scenario. The fact that there is Event Y doesn't change anything either.

Now, if you clean my car, and I agreed to pay you $50, but don't, then that is implicit theft. Your service has been clearly stolen.

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Wheylous replied on Wed, Sep 14 2011 12:40 AM

So charity is legally retractable?

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Clayton replied on Wed, Sep 14 2011 2:24 AM

Two words: conditional contract

An estate trust is a conditional contract. It is not valid until the death of the person whose estate is to be put into trust upon their death. There are many such contracts. It seems from a cursory glance that you believe you can't put the word "if" or "on condition" in a contract transferring property title. Why do you think that?

Rothbard is very explicit on this point.

THE RIGHT OF PROPERTY implies the right to make contracts about that property: to give it away or to exchange titles of ownership for the property of another person. Unfortunately, many libertarians, devoted to the right to make contracts, hold the contract itself to be an absolute, and therefore maintain that any voluntary contract whatever must be legally enforceable in the free society. Their error is a failure to realize that the right to contract is strictly derivable from the right of private property, and therefore that the only enforceable contracts (i.e., those backed by the sanction of legal coercion) should be those where the failure of one party to abide by the contract implies the theft of property from the other party. In short, a contract should only be enforceable when the failure to fulfill it is an implicit theft of property. But this can only be true if we hold that validly enforceable contracts only exist where title to property has already been transferred, and therefore where the failure to abide by the contract means that the other party’s property is retained by the delinquent party, without the consent of the former (implicit theft). Hence, this proper libertarian theory of enforceable contracts has been termed the “title-transfer” theory of contracts.1

     Let us illustrate this point. Suppose that Smith and Jones make a contract, Smith giving $1000 to Jones at the present moment, in exchange for an IOU of Jones, agreeing to pay Smith $1100 one year from now. This is a typical debt contract. What has happened is that Smith has transferred his title to ownership of $1000 at present in exchange for Jones agreeing now to transfer title to Smith of $1100 one year from now. Suppose that, when the appointed date arrives one year later, Jones refuses to pay. Why should this payment now be enforceable at libertarian law? Existing law (which will be dealt with in greater detail below) largely contends that Jones must pay $1100 because he has “promised” to pay, and that this promise set up in Smith’s mind the “expectation” that he would receive the money.

     Our contention here is that mere promises are not a transfer of property title; that while it may well be the moral thing to keep one’s promises, that it is not and cannot be the function of law (i.e., legal violence) in a libertarian system to enforce morality (in this case the keeping of promises). Our contention here is that Jones must pay Smith $1100 because he had already agreed to transfer title, and that nonpayment means that Jones is a thief, that he has stolen the property of Smith. In short, Smith’s original transfer of the $1000 was not absolute, but conditional, conditional on Jones paying the $1100 in a year, and that, therefore, the failure to pay is an implicit theft of Smith’s rightful property.

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So charity is legally retractable?

A promise or contract to charity is of course legally retractable. Already transferred charity is not, obviously.

@Clayton- My argument here is that nothing has been implicitly stolen. If X makes a contract to marry Y, and the contract says X owes Z Money if  he opts out of marrying Y, then such a contract could not be enforced. Rothbard explicitly agrees with me on this point. (See Chapter 2, Section 13 of MES).

Now, in my original argument, I realize that one could argue B has frauded A out of a service (the service of making the right bet), as Wheylous argued. Perhaps this is true; I'm not certain. What do you guys think? But there has to be a stolen property or service (IMPLICIT THEFT, as Rothbard says) for a contract to be enforced.

 

 

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Rothbard says:

Evidence of a promise to pay property is an enforceable claim, because the possessor of this claim is, in effect, the owner of the property involved, and failure to redeem the claim is equivalent to theft of the property. On the other hand, take the case of a promise to contribute personal services without an advance exchange of property. Thus, suppose that a movie actor agrees to act in three pictures for a certain studio for a year. Before receiving any goods in exchange (salary), he breaks the contract and decides not to perform the work. Since his personal will is inalienable, he cannot, on the free market, be forced to perform the work there. Further, since he has received none of the movie company property in exchange, he has committed no theft, and thus the contract cannot be enforced on the free market. Any suit for “damages” could not be entertained on an unhampered market. The fact that the movie company may have made considerable plans and investments on the expectation that the actor would keep the agreement may be unfortunate for the company, but it could not expect the actor to pay for its lack of foresight and poor entrepreneurship. It pays the penalty for placing too much confidence in the man. The movie actor has not received and kept any of the company’s property and therefore cannot be held accountable in the form of payment of goods as “damages.”44 Any such enforced payment would be an invasion of his property rights on the free market rather than an attack upon invasion. It may be considered more moral to keep promises than to break them, but the condition of a free market is that each individual’s rights of person and property be maintained, and not that some further standard of morals be coercively imposed on all. Any coercive enforcement of such a moral code, going beyond the abolition of invasive acts, would in itself constitute an invasion of individual rights of person and property and be an interference in the free market.45

It certainly would be consonant with the free market, however, for the movie company to ask the actor to pay a certain sum in consideration of his breaking the contract, and, if he refuses, to refuse to hire him again, and to notify other prospective contracting parties (such as movie companies) of the person’s action. It seems likely that his prospect of making exchanges in the future will suffer because of his action. Thus, the “blacklist” is permissible on the free market. Another legitimate action on the free market is the boycott, by which A urges B not to make an exchange with C, for whatever reason. Since A’s and B’s actions are purely voluntary and noninvasive, there is no reason for a boycott not to be permitted on the unhampered market. On the contrary, any coercive action against a boycott is an invasion against the rights of free persons.

44This is true even if the actor had previously agreed in a contract that he would pay damages. For this is still merely a promise; he has not implicitly seized someone else’s property. The object of an enforcing agency in a free society is not to uphold promise-keeping by force, but to redress any invasions of person and property.

45Sir Frederick Pollock thus describes original English contract law: “Money debts, it is true, were recoverable from an early time. But this was not because the debtor had promised to repay the loan; it was because the money was deemed still to belong to the creditor, as if the identical coins were merely in the debtor’s custody. The creditor sued to recover money . . . in exactly the same form which he would have used to demand possession of land . . . and down to Blackstone’s time the creditor was said to have a property in the debt—property which the debtor had granted him. Giving credit, in this way of thinking, is not reliance on the right to call thereafter for an act . . . to be performed by the debtor, but merely suspension of the immediate right to possess one’s own particular money, as the owner of a house lot suspends his right to occupy it.. . . The foundation of the plaintiff’s right was not bargain or promise, but the unjust detention by the defendant of the plaintiff’s money or goods” (Sir Frederick Pollock, “Contract,” Encyclopedia Britannica [14th ed.; London, 1929], VI, 339–40).

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Clayton replied on Wed, Sep 14 2011 1:06 PM

@RD: You're just over-complicating things and running in circles.

1) "I hereby promise to pay you $10 on January 1, 2012"

Rothbard says: "This is not enforceable. It's just a promise and people can lie or break their promises without legal consequence."

2) "I hereby transfer title to $10 to you, to be paid on January 1, 2012"

Rothbard says: "This is enforceable. It's not just a promise, it's an actual transfer of property title. Transport of the property for which title has already been transferred must occur on January 1, 2012 or theft is occurring."

3) "I hereby transfer title to $10 to you on condition that the Patriots win the Super Bowl in 2012."

Rothbard says: "This is also enforceable. It's not just a promise, it's an actual transfer of property title on condition that the Patriots win the Super Bowl in 2012. If that condition is fulfilled, then this title transfer is effective. Otherwise, it is null and void."

What is there left to be confused about?

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1) "I hereby promise to pay you $10 on January 1, 2012"

Rothbard says: "This is not enforceable. It's just a promise and people can lie or break their promises without legal consequence."

2) "I hereby transfer title to $10 to you, to be paid on January 1, 2012"

Rothbard says: "This is enforceable. It's not just a promise, it's an actual transfer of property title. Transport of the property for which title has already been transferred must occur on January 1, 2012 or theft is occurring."

The difference between these two is indistinguishable. Both are just promises. Rothbard defines contract as "an agreed-upon exchange between two persons of two goods*, present or future" (MES 177). In this case, there are plainly not two goods/services being transferred; one person has promised to pay $10. Neither case is implicit theft. That's just ridiculous. Rothbard is talking about a case of fraud, i.e., where Smith transfers $1000 to Jones, on condition that Jones shall pay $1100 to Smith a year from now.

A contract may say: If X doesn't marry Y on date January 1, then X must transfer title of Amount Z to Y.  But if X does not pay Amount Z, no theft has occured. How could it be theft when nothing is being implicitly stolen?

*Note that a good can be a service.

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I just really am quite curious as to who is misinterpreting Rothbard. If you agree that the movie actor's contract cannot be enforced (see Rothbard's example above), then, similarly, a "title to $10" cannot be enforced, if fraud has not transpired. Rothbard clearly states that something must be implicitly stolen for a contract to be enforced. If I give you "title of $10," and do not pay it, then how have I implicitly stolen from you? If I contracted to give you a "title of $10" for you cleaning my floor, and then I refused to pay, obviously I would be stealing your service implicitly.

"I hereby transfer title to $10 to you, to be paid on January 1, 2012" In this case, what have I implicitly stolen from you? Like the movie actor, I have stolen absolutely nothing.

"I hereby pledge my service to act in your movie, to be paid on January 1, 2012," is the same as "I hereby transfer title to $10 to you, to be paid on January 1, 2012"  If you agree with Rothbard that the former contract cannot be enforced, then you must agree on the latter.

 

 

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Anarcho replied on Wed, Sep 14 2011 3:42 PM

The problem is they are not the same thing according to Rothbard.  The first example is a title transfer.  You have agreed to transfer the title of $10 to someone else on Jan. 1, 2012.  If you do not you are a thief.  The second is not a title transfer according to Rothbard since he did not believe you could transfer title in your person.  The will, in Rothbard's opinion, was inalienable, and therefore any contract made in which someone was transfering title to their person would be invalid in a free society since the will is inalienable.  $10 is property that can be given, its title can be transfered.  Rothbard believed the will could not.  In otherwords the movie actor cannot be forced to meet the contract since they have not promised any title that can be transfered.  If the contract read: "I hereby pledge my service to act in your movie, to be paid on January 1, 2012.  If I do not then I pledge to reimburse you $100."  That would be a legitimate contract as far as if you did not show you would have to pay $100.

"It is easy to be conspicuously 'compassionate' if others are being forced to pay the cost." - Murray N. Rothbard.

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If the contract read: "I hereby pledge my service to act in your movie, to be paid on January 1, 2012.  If I do not then I pledge to reimburse you $100."  That would be a legitimate contract as far as if you did not show you would have to pay $100.

Egregious.

Rothbard specifically cautions against that, stating in footnote 44 of the same passage:

44This is true even if the actor had previously agreed in a contract that he would pay damages. For this is still merely a promise; he has not implicitly seized someone else’s property. The object of an enforcing agency in a free society is not to uphold promise-keeping by force, but to redress any invasions of person and property.

Basically, Anarcho, I am saying that you are misinterpreting Rothbard's view of title transfer.

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Clayton replied on Wed, Sep 14 2011 6:11 PM

 

 

Rothbard defines contract as "an agreed-upon exchange between two persons of two goods*, present or future"
 
Exactly. A title is just a "good-subsitute" and exchanging the title is one and the same as exchanging the good itself. If I give you the title to my car, I have given you my car, even if the car is in impound or in a different state.
 
When I write a contract that says, "I hereby transfer to you title to $10 to be delivered on such-and-such condition", the exchange has already occurred and once the condition is fulfilled, then failure-to-deliver is not just breaking a promise, it is a form of theft through refusal to give up the property in question. Consider a storage unit company that changes the locks on your storage unit and says "Well, you gave us your stuff, so it's ours and if we choose to change the locks on you to keep you out, that's our prerogative." Obviously, something is wrong here. Possession is not ownership and the terms of the contract under which custody of your property was transferred to the storage unit company is what determines whether they may rightfully change the locks on your storage unit. Unless you've failed to pay your bill or something, they may not refuse to give you back your stuff if you demand it... to do so is theft. The fact that they currently have possession means nothing.
 
Clayton -

 

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Wheylous replied on Wed, Sep 14 2011 6:14 PM

To make the contract enforceable, the contract merely has to say "We, the movie company, create a fund of money out of which the actor may draw funds at the completion of his service to us. He, the actor, creates a fund of money out of which no one may withdraw unless the actor resigns, in which case we may draw from the fund." Bam. The fact is that people want to enforce non-property (or at least non-property according to you) in contracts, and hence will find workarounds the general rule, injecting in some measure to enforce the contracts.

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Wheylous replied on Wed, Sep 14 2011 6:17 PM

1) "I hereby promise to pay you $10 on January 1, 2012"

I think the time difference might complicate matters for some unknown reason. Let's reword it:

1) "I hereby promise to pay you $10 one second after you hand give me that apple"

Is this not enforceable?

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