Secession

is the ability to secede a good thing?

Arguments for the right of a region, Catalonia or Scotland, to secede are often put as a right to self-determination. That, in my view, is to confuse groups with persons. Catalans are persons; “The Catalans” are not. A Catalan has rights, the collective does not. If the Spanish government violates the rights of a Catalan by taxing or drafting him those would still be violations of his rights if done by a Catalonian government. The arguments for and against secession that interest me have to do not with whether peoples have a right to self-determination but whether making secession easier will make the world a better or a worse place for the persons who live in it. To answer that question, I begin with a short, but I think relevant, digression.

Many years ago I spent a summer in Washington, mostly working with people concerned about state and local finance. One of the problems that concerned them was tax competition.

In Defense of Tax Competition

A company plans to build a new factory. Various state or local governments that want the opportunity to tax it and its employees offer special favors, freedom from property taxation for five years say, if it will locate in their state or town. The resulting bidding war reduces the amount the winning government gets from the firm. That is tax competition.

The people who see tax competition as a problem have things backwards. The problem is not how governments are to get their hands on money. The problem is how to make sure that government only collect money that they spend in ways that are worth the cost to the people the money comes from.

Seen from that standpoint, tax competition is not a problem but a solution. It leads to low taxes only if the taxes are not producing services of value to the taxpayers, in which case low taxes are a good thing. A jurisdiction that offers no tax breaks but provides services that the factory values at more than their cost, good schools, for example, that make it easier to hire employees, will be more attractive to the firm than a jurisdiction that offers low taxes and low services. It is only if high taxes are exploitative, are spent on things of no value to the people they are collected from, that tax competition will discourage them. The net effect of competition among jurisdictions for taxpayers, like the net effect of competition among firms for customers, is to make exploitation more difficult and the efficient production of desired services more likely.

Back to Secession

Easy secession has a similar effect. To the extent that a region whose people believe they are getting a bad deal from their central government, paying more and getting less than if they ran their own affairs, can secede, that gives central governments an incentive not to exploit regions. The easier secession is, the more governments are constrained to give value in exchange for the costs they impose upon their subjects.

The result is not as close to an efficient outcome as the result of ordinary competition in private markets, in part because some of the goods governments produce, although fewer than often claimed, are public goods for a public larger than a region, in part because decisions by regions are themselves political acts, hence reflect individual interests less accurately than decisions by individuals. But it should still be an improvement on the situation that exists when a government has an unchallenged monopoly, as it does if secession is not an option.

There are a number of objections that might be raised against this argument. I will consider three.

Preventing Benevolent Redistribution

One possible problem is that easy secession may prevent exploitative taxation even when it arguably should not be prevented, when, for example, the central government is taxing rich people in a rich region for the benefit of poor people in a poor region. In my view, this possibility is sufficiently unlikely in the real world that there is no need for me to argue about whether such redistribution is forbidden, permitted or required, by principles of justice. No doubt it is theoretically possible that a poor and powerless region of a country will by good fortune gets its hands on the levers of power and use them to benefit its citizens at the expense of its richer neighbors. No doubt it is theoretically possible that the benefit will be directed to the poor people of the poor region rather than appropriated by their not-poor leaders. But I do not think that, on either theoretical or empirical grounds, that is the way to bet.

The Problem of Exploitative Secession

A second and more serious argument against easy secession is that a region may secede not in order to prevent its central government from exploiting it but in order to be free to exploit minorities within its own population. The case of Kosovo, where it can plausibly be argued that the ethnic Albanians wished to secede from Serbia in part in order to be free to oppress the ethnic Serbians, is an example.

One way of reducing this problem is to require a supermajority for secession, perhaps three quarters or more. In many cases — Biafra, for example, when it attempted to secede from Nigeria — this should be an easy requirement to meet. One advantage of such a requirement is that it gives groups agitating for secession an incentive to propose boundaries that, as nearly as possible, exclude from the new state those people who do not wish to be in it, thus increasing their majority and decreasing subsequent problems.

A second way of reducing the problem is to extend secession further down the scale. To the extent that a minority within the new state formed by secession is itself free to secede, either to rejoin the parent state or to form a new state, that will limit the ability of the new government to oppress it. This is not a purely theoretical possibility. The state of West Virginia exists because, when Virginia seceded from the Union, what is now West Virginia seceded from Virginia. I have a vague memory that one or two counties, or parts of one or two counties, then seceded back to Virginia, but I will not swear to that part of the story.

The farther down secession goes, the less the opportunity for exploitation by the resulting set of states, because exploitation is constrained by mobility.¹ If the only way I can escape an oppressive state is to leave everyone and everything I know and travel far away to a strange country where nobody speaks my language, the state can get quite oppressive before many people are willing to leave. If all I have to do is move across the street, it will not take much oppression to make me do it.

Regions That Are Not Economically Viable

A final objection that may be raised to easy secession as a way of controlling states is that a region may not be economically viable, making the threat to secede unpersuasive and the act imprudent.

The problem with this argument is that most countries are not economically viable, would be substantially worse off if they were surrounded by a high wall and unable to trade across it. The reason that is not a serious problem is that countries are not surrounded by high walls. As long as there is something reasonably close to free trade in the world and as long as communication with the outside world is not effectively blocked by the country being seceded from, even a very small country can function as a politically independent part of an economically interdependent world.

A Digression: Protecting Non-Territorial Minorities

Using the threat of secession to prevent state exploitation depends on the target of such exploitation being a region. It does not solve the problems of non-territorial minorities. That would include nomadic peoples, a current issue in north-west Africa. It would also include dispersed ethnic minorities, enthusiastic adherents of a new religion (a situation China is currently facing), and the like.

I see two possible solutions. One is to abandon the idea that a state has monopoly power in a particular territory and move in the direction of non-territorial states or state substitutes. A historical example would be the situation of the Catholic church in medieval Europe. The English Crown did not have jurisdiction over clerics, with the result that a cleric accused of a serious offense could plead benefit of clergy and have his case transferred to a church court to be tried under church law. A more extreme example of a non-territorial system was sketched in my first book, The Machinery of Freedom, where I proposed institutions in which rights were protected and disputes settled through a system of competing private firms, a system of ordered anarchy. A less radical solution along similar lines is for a single government to claim ultimate authority but permit large parts of what we usually think of as governmental authority to be in the hands of more nearly voluntary associations. A real world example at present would be the Amish in the U.S., in practice if not in theory permitted to opt out of much of the American legal system.

The middle ages provides historical examples of such polities. Consider the Muslim case. Medieval (and modern) Sunni Muslims recognize four different, but mutually orthodox, schools of law. While some schools were more widely accepted in certain geographical areas than others, there was no strict relation between where you lived and what school of law you accepted. The result was that a major Muslim city would have at least four different court systems, one for each of the schools of law, and possibly additional courts systems for Shia Muslims, Christians and Jews. Presumably the system worked in part because most legal disputes were intracommunity — Maliki with Maliki, Hanbali with Hanbali, Jew with Jew. Hence for most disputes the problem of what legal rules would apply to a conflict between parties identifying with different communities did not arise. Similarly, Welsh in Wales were not under English law until the 16^th century and Muslims in Spain remained under Muslim law for a century or so after they were conquered by Christians. In this respect, at least, the modern state with its unitary legal system is less tolerant of diversity than the states of the middle ages.

Getting There From Here

My argument so far has attempted to show that the world would be a better place if secession were easier. That leaves an obvious question: How does one get governments to permit secession, given the obvious advantage to them of preventing it?

Insofar as I have an answer to that question it is that one makes secession easier by persuading lots of people that easy secession is a good thing. That does not, of course, guarantee easy secession. But it does increase the costs, internal and external, of suppressing secession. It is worth noting that what ultimately ended slavery in the 19^th century was not the British navy, useful although its efforts in suppressing the slave trade were, but the increasingly widespread belief that slavery was a bad thing, a belief that resulted in slavery being independently abolished, through a variety of different mechanisms, in the West Indies, the U.S., Brazil, and elsewhere.

One thing determining the practicality of secession is the attitude of other countries, how willing they are to accept the new country that would result. Catalan secession would be easier if it were clear that the EU would accept Catalonia as a member and similarly for Scotland.

A final question that I have not yet dealt with is how large a region must be in order for my arguments for easy secession to apply. My own answer is that the minimal region consists of one person. That is not a politically viable policy this year nor likely to be any year soon. But my argument does not depend on the question of how far down the geographical ladder secession is permitted. The argument is not about all or nothing but about more or less.

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1. In C. Northcote Parkinson's immortal words, “As a reckless generalization we can say that the productive people of the world have discovered from experience that they will always have to yield 10 percent to somebody, whether to a gangster, a feudal lord or a department of internal revenue. ... When it rises much above that level, the time has come for the Israelites to study the atlas. There may be better places than Egypt; and in point of fact there are.” (C. Northcote Parkinson, The Law and the Profits.)