Adventure Capitalism

A History of Libertarian Exit, from the Era of Decolonization to the Digital Age

Raymond Craib

• Publisher: PM Press
• Year: 2022
• ISBN:
  9781629639277
• Topic: Economics
• Subtopic: Political Economy
• Index: Economics

Imagine a capitalist paradise. An island utopia governed solely by the rules of the market and inspired by the fictions of Ayn Rand and Robinson Crusoe. Sound far-fetched? It may not be. The past half century is littered with the remains of such experiments in what Raymond Craib calls "libertarian exit." Often dismissed as little more than the dreams of crazy, rich Caucasians, exit strategies have been tried out from the southwest Pacific to the Caribbean, from the North Sea to the high seas, often with dire consequences for local inhabitants. Based on research in archives in the US, the UK, and Vanuatu, as well as in FBI files acquired through the Freedom of Information Act, Craib explores in careful detail the ideology and practice of libertarian exit and its place in the histories of contemporary cap­italism, decolonization, empire, and oceans and islands. Adventure Capitalism is a global history that intersects with an array of figures: Fidel Castro and the Koch brothers, American segregationists and Melanesian socialists, Honolulu-based real estate speculators and British Special Branch spies, soldiers of fortune and English lords, Orange County engineers and Tongan navigators, CIA operatives and CBS news executives, and a new breed of techno-utopians and an old guard of Honduran coup leaders. This is not only a history of our time but, given the new iterations of privatized exit—seasteads, free private cities, and space colonization—it is also a history of our future.

PART I Any Distant Archipelago

(1960s–1980s)

CHAPTER ONE Libertarian Exit

Fear and Loathing USA

1968: A Year when “The Libertarian Position took off like a Jet,” Recalled Robert Lefevre, founder of the Freedom College whose attendees in the mid-1960s included brothers Charles and David Koch. A year of emboldened embrace of capitalism and free-market fundamentalism, of aspirations to defeat the New Deal and compete with the New Left, and of university campuses producing a generation of newly minted MBAs. A year in which the promise of communes was offset by the tragedy of the commons, as biologist Garrett Hardin termed it in his seminal Science essay; in which young leftists read Herbert Marcuse and young libertarians read Ayn Rand and an MIT graduate founded the libertarian magazine Reason and a Playboy columnist reminded readers that Ayn Rand had a nineteenth-century forerunner in Lysander Spooner, whose libertarian tract No Treason: The Constitution of No Authority “may be the most subversive document ever penned in this nation.” A year that welcomed the dawning not of the age of Aquarius but that of Atlantis, the favored reference point for libertarians’ utopian aspirations. And the year in which one of those libertarians, forty-year-old Michael Oliver, published his exit manifesto entitled A New Constitution for a New Country. The first edition appeared in February. It sold so well that a second edition appeared three months later, in May 1968.¹

A declaration of purpose

Michael Oliver was born Moses Olitzky in Kaunas, Lithuania in 1928. At the time, Kaunas was a cosmopolitan city. A former resident and acquaintance of Olitzky’s described it thus: “Nearly a third of its one hundred thousand residents were Jewish. For decades it had been a favored asylum for all sorts of political refugees. It was a bit like some small Eastern European version of Beirut or Casablanca, with its Nordic gentiles, its Poles and Russians, its Germans and Jews, in a place forever on the border of the next war.”²

War arrived in 1940, first with a brief Soviet incursion and then, in the spring of 1941, with a German occupation. German troops and Lithuanian patrols rounded up the city’s Jews and transported them to the Seventh Fort, hastily converted by the Nazi command into a concentration camp, where they murdered the men and raped and murdered the women. Between eight and twelve thousand Jews died.³ Olitzky, along with most of the city’s surviving Jews as well as many who had fled to Kaunas from neighboring Poland after the German invasion, was forcibly moved into a ghetto on the outskirts of the city. In the summer of 1944, the Nazi command relocated many of the ghetto’s surviving inhabitants, including Olitzky, to the Stutthof concentration camp near Danzig (Gdansk, Poland). From Stutthof, he and other prisoners were moved in railway cattle cars across Poland to Lager 10, a newly constructed camp outside of Dachau. Liberated by US troops while on a forced march from Dachau in the spring of 1945, Olitzky then spent two years in a displaced persons camp before emigrating to the United States in 1947. His parents and four siblings all had been murdered.⁴

Once in the US, Olitzky changed his name to Michael Oliver, became a naturalized American, joined the Air Force for a five-year stint, and worked for companies on radar and satellite tracking systems. By the 1960s he had married, started a family, and set roots down in Carson City, Nevada. He owned and operated a land development company as well as the Nevada Coin Exchange, specializing in the sale of gold and silver coins which he advertised as security investments in the pages of the Wall Street Journal, Barron’s, and the libertarian magazine Innovator. Over the course of the decade Oliver became a millionaire and began to translate his wealth into a hedge against what he feared was a growth in totalitarianism in the US. This hedge was to be a new country, founded on laissez-faire principles and the initial structure of which he outlined in his 1968 constitution.⁵

Oliver crafted his constitution for an imagined libertarian territory freed from bureaucratic constraints and the regulatory apparatus of the welfare state. But, most importantly, he envisioned his territory as freed from the persistent threat of the masses and mob rule. The book contained a declaration of purpose, a plan of action, and a constitution with eleven articles. Oliver designed the constitution as an improved version of the United States Constitution—improved in that it would “spell out the details whereby government can, at the same time, properly protect persons from force and fraud and also be prevented from exceeding this only legitimate function.”

Is it not time for developing a Constitution which is to conform completely to the premise that man has full rights to his life and property and must not infringe upon the same rights of others? Is it too difficult to show in detail, rather than by general statements, how a nation can be established, maintained, and defended if founded on such a basis? Have plans been made to provide a means for honorable persons to escape the increasing horror of civil strife and coming economic collapse? These timely questions are being asked today by many worthwhile persons who desire to survive the onslaught of totalitarianism.⁶

The book’s opening “Declaration of Purpose” left little to the imagination: “Let the establishment of ‘social meddlers’ reap its own harvest; let the innocent person, who tried in vain to stop the onslaught of totalitarianism, escape the horror.”⁷ Given the horror Oliver had himself experienced as a young Jewish man, and the horrific violence visited upon his family, it is no surprise that he watched intently for signs of encroaching totalitarianism. His own experience had taught him to be aware of the suddenness with which the world can turn and of the pervasive undercurrents of violence that coursed through the social world. But what remains to be explained is why he sought refuge in American libertarianism, particularly given that some of its proponents espoused a social conservatism rife with its own racial and exclusionary undertones.

Libertarians rising

The libertarian energies of 1968 did not arise spontaneously. Advocates of free markets and free enterprise had been organizing intensely over previous decades to turn aspects of the postwar developmental state toward private gain. The Mont Pelerin Society (MPS), the American Enterprise Institute (AEI), the Foundation for Economic Education (FEE) and the Institute for Economic Affairs (IEA), founded as think tanks to fight the New Deal, promoted positive images of large corporations and sought to make free-market ideologies palatable to a broader public. The IEA had been founded by former British fighter pilot and chicken farmer Antony Fisher who found inspiration in the Reader’s Digest condensed version of Friedrich Hayek’s seminal work The Road to Serfdom which had conveniently deleted Hayek’s “support for a minimum standard of living for the poor, environmental and workplace safety regulations, and price controls to prevent monopolies from taking undue profits.”⁸ Leonard Read had been promoting and disseminating Hayek’s work through the FEE as part of his “freedom philosophy.”⁹ In the 1960s Charles and David Koch, Robert Mellon Scaife, and future Supreme Court Justice Lewis Powell, among others, began to strategize around how to challenge what they perceived to be a state intent on expanding further and further into corporate life and profits.¹⁰ Armed with substantial wealth, the Koch brothers and Scaife, as well as conservative allies such as Coors Brewing Company scion Joseph Coors, pumped additional sums of money into militantly conservative institutions and think tanks in order to wage a battle of ideas and launch public relations campaigns in favor of a concept long out of favor: the free market.¹¹ This entailed not only championing a self-regulating and theoretically isolated market but also critiquing the regulatory and welfare state as inefficient and a problem rather than solution to pressing social and economic issues.

Political culture too was shifting. Arizona Senator Barry Goldwater’s Conscience of a Conservative (1960) had drawn readers’ attentions to the ideas of free-market economists Hayek and Ludwig von Mises, and, by the time he ran as the Republican candidate for the presidency in 1964, he had been organizing for close to a decade to challenge the modern Republicanism characteristic of the Eisenhower administration.¹² Goldwater’s 1964 campaign energized manufacturers and entrepreneurs and inadvertently introduced Ronald Reagan to a ready public; Milton Friedman did a stint as Goldwater’s economic advisor before moving on to publish a regular column in Newsweek magazine starting in 1966.¹³ A younger generation tuned in: William F. Buckley’s Young Americans for Freedom, an organization he created at Yale University in 1960 to give voice to conservative students’ concerns, grew rapidly to the degree that by the end of the decade it had divided into “trad” (traditionalist conservatives) and “rad” (libertarian) wings.¹⁴

On the west coast libertarian ideas found fertile soil. Northern California’s counterculture and tech ...

Table of contents

• Cover
• Title Page
• Copyright
• Contents
• List of figures
• Epigraph
• Introduction
• Part I. Any Distant Archipelago, (1960s–1980s)
• Part II. Iterations of the Digirati, (1980s–present)
• Epilogue. The World Lies Waiting
• Acknowledgments
• Bibliography
• Index
• About the Author
• About PM Press
• Friends of PM Press