Definition: "Ghetto Ethics"

[G]hetto Ethics: quite literally, the ethics of the medieval urban ghetto.

As a ‘state within a state’ residents of the ghetto can conduct exchange as if they are state actors by relying upon high trust exchange in-group, while using low trust exchange out-group.

However, in any polity, each of us cannot act as a ‘state’ by applying low trust with some and high trust with others because the net result is a near universally low trust society for the vast majority.

In such an environment demand for the state and its interventions as a proxy for trust remains high, since low trust is by definition the use of cunning and deception to obtain discounts and premiums that the opposite party would not tolerate willingly.

In other words, low trust ethics are parasitic, and impose high transaction costs on the population.

[T]he underlying point I’m making is the absurdity of using the model of a state within a state to advocate for a stateless society. In that lens the entire rothbardian project is… well, absurdly illogical. Laughable even.

Aristocratic egalitarianism (the protestant ethic) suppresses all cheating such that demand for the state is low because transaction costs and conflicts are minimized, while the velocity of production and exchange is high.


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