Towards a New System of Governance

Beyond the State and Politics


The Problem

Not for their establishment, but for their preservation, political systems need the approval of public opinion. Power never exists by crude force alone. State power dominates and falls with its legitimacy, which comes from the approval by the public opinion.

The great dictatorships of the twentieth century received their position of power from the belief in certain ideologies. Not the brutal violence made their rule possible, but the consent of the masses allowed the governments to use brutal force.

Today, the belief in democracy as majority rule dominates the mindset of the population and forms the basis of the legitimacy of this system. Yet democracy in the form of the majority voting system leads to interventionism, and from there, socialism is only a step away. Democracy does not protect against folly or tyranny.

How can one redesign the political system towards more freedom? In the first step, one must deprive the existing system of ‘liberal’ democracy of its false legitimacy and to show the alternative.

Monetary Reform

A false legitimation relates, first, to money. Habit and lack of knowledge are the reasons that for many people there is no alternative to the present system although there is a lot of uneasiness with the monetary order. In the modern economy, the state has a monopoly over money. Yet why this is so, there is no rational answer. With the national central bank, the state has a central command body over the financial system. This monetary system rests on centralism and monopolism. Central banking stands in opposition to free capitalism.

The members of the central bank are among the most important holders of power. They come into these positions on intricate and opaque paths. Like the Constitutional Court, the members of the Central Bank are appointed. I

n the same way, as the supreme judges act as masters of the Constitution by pretending to protect them, the members of the central bank are the masters of the money system and claim to preserve the value of money. Not different from the ‘protectors of the Constitution’ as masters of constitutional transformation, the central bankers — as proclaimed ‘guardians of our currency’ — are the main culprits of the monetary havoc and the financial crises that have afflicted capitalism.

In monetary matters, central bankers do rule over the economy like a Soviet central committee. How these members of the uppermost power elite come into the respective positions remains hidden, and what they do is frightening.

The failure of the central bankers is no less apparent than the problem with the disgraceful verdicts of the supreme judges. The central bankers are responsible for the big economic catastrophes of the twentieth century: the hyperinflation of the 1920s in Germany and the Great Depression of the 1930s in the USA.

The stagflation of the seventies is the produce of the mismanagement of central bankers as well as the financial crisis of 2008. Over the next ten years, the combined efforts of the central banks of the US, Japan, and Europe have instigated the largest speculative bubble the world has ever seen. By implanting interest rates that are below any reasonable level, central bankers have fueled a global speculative frenzy of gigantic proportions. Nevertheless, the media put the blame on ‘capitalism’, and praise central bankers and finance ministers as the ‘saviors’ of the system. The public gets deceived by the pundits in academia and the media who praise the wolves as the guardians of the sheep.

The task is to reform the monetary system and to curb the national debt and get to real democracy. The existing monetary regime is a state-political instrument for the exercise of power, which allows the unrestrained expansion of the welfare state, war-making, and to accumulate public debt.

A new monetary order is a decisive step towards the new economic order. The change of the system can come within the framework of the prevalent legal basis. Abolishing the state monopoly on money and recognizing private money as a means of payment is the way to start the reform of the monetary system.

The point is to give back to the citizens the freedom of monetary choice over which currency to use. Economic actors should be free to decide which money they would like to have for their transactions.

As a first step, one must eliminate the prime position of the central bank as a central planning body. This can be done by imposing a limit on the quantity of the central bank money.

If the central bank no longer has access to manipulating the money supply, the monetary authorities can no longer manipulate the basic rate of interest. After that, it should be easy to phase out the central bank as a public institution by sending the officeholders into retirement. This measure would eliminate the main source of cyclical turmoil.

Freezing the quantity of central bank money will put a brake on the government to accumulate debt and thus also help to neutralize the role of governmental interventionism as the other main source of creating economic havoc besides central banking.

Electoral System

As a second step, the plan comes into play of reforming the electoral system and do away with the political class. Ending the current electoral system of a majority vote in favor a lottery for selecting the representatives of the people, would eliminate party politics and professional politicians.

With the modern means of communication, it is possible to select a representative body of the population by random sampling. According to this model of the political lottery, the members of this group would form the Legislative Assembly. Such an Assembly would be participatory and representative.

Selecting the people’s representative by lot would be also cheaper than the election campaigns and to maintain parliaments and congresses in their present forms. This Assembly would then hire private government management companies — to exert the function of government under the strict supervision of the Assembly.

In the United States, the Freedom Movement could push for this election model in individual states and from there the movement could spread across the country until after a phase of experimentation it could serve for the election of the members of Congress.

In Europe, one could start with the city councils of the metropolitan areas. As a transitory method, one could also consider forming a kind of ‘Upper House’ or ‘Senate’ by the random selection of its members. This House would oversee the actions of the members of Congress and be the ultimate body of the approval of the laws. This assembly should have full veto power over new laws. The assembly would be composed of members who are selected by a rolling lottery with each member serving for two years has many advantages over the present system.

Private government management companies would emerge on competitive markets and offer their services first at the municipal and the state level and from there comprise larger entities up to the level of a country or a union of states. Private government management companies would be in the business to earn a profit and as such they must satisfy the demands of their client (which is the people represented by the Assembly) at the lowest cost.

Steps to take

Source: Beyond the State and Politics

The change of the political system along the lines as sketched above would lead to the following consequences:

First, serious policymaking in favor of the best for the population would replace the current political game plays that serve special interest groups.

Second, the random selection system would bring a wide range of expertise to the political system.

Third, the members of such an Assembly would not be power-hungry psychopaths and political careerists because, after their short period of life in politics, these persons would return to their private life.

Finally, such legislative procedures would give priority to cut government spending and lowering the tax burden because the members of the Assembly will be the ones who must pay for them.

One may expect that with ‘demarchy’, government spending will fall, taxes will be lower, and bureaucracy will be less.

The third project treats the legal and the security system. At present, the judicial order is contradictory since the judiciary itself is part of the political system about which it decides. To speak of the ‘independence’ of the courts is as unrealistic as to claim that the central banks are independent. The state-jurists praise the division of power, yet their existence proves otherwise and underlines that to realize the principle is impossible and exists only as a myth.

De-politicization, de-bureaucratization, and the private organization of justice, as well as internal and external security, are the mainstays on the way to establish a libertarian economic and social order.

Doing away with the professional politician, and of party politics, comes with the electoral reform that stipulates the selection of the legislative assembly by the principle of chance.

The legislative body will promote the de-bureaucratization of the state. Finally, the private organization of justice and internal and external security comes into existence.


In the modern political state, the division of powers is a fallacy, for the political parties are not only present in the legislative body but are also in government as well as they appoint the judges, including the members of the Constitutional Court. A state legal system is not independent as it exists in close ties to the prevailing power structure.

All moral aberrations of the Zeitgeist sneak into the jurisprudence: from the local jurisdiction to the constitutional courts. There has been no perversity on this earth that was not legal at some time and with which the courts did not collaborate.

Not only the United States suffers from the discrepancy between the value system prevalent at the courts and that of the population. The loss of trust in the law has become as severe as the loss of confidence in politics.

A private system of jurisprudence would end with the exercise of the authority of the public judiciary over the people. A private legal system would cost less, be more effective and it would be more just. Artificial intelligence would come to its full potential under a private legal system and cut expenses for legal services to a small fraction of what it costs now.

Dr. Antony P. Mueller is a German professor of economics who currently teaches in Brazil. See his website:

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