Comment: The Law Merchant

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The Law Merchant

Your idea of "small g government" approximates the lex mercatoria or "Law Merchant," a system of stateless laws that made (and still operates today) international trade possible:

In the eleventh century Europeans discovered agricultural improvements that could sustain a larger population. The growing population increasingly migrated to urban areas. In these cities a new class of merchants was born. Merchants across Europe were separated by language, distance, and local law. To facilitate trade, they needed a common set of commercial rules. Out of that need the Law Merchant was born.

The Law Merchant was a purely informal body of law. It developed out of merchants’ international commercial customs and shared legal notions. Roman law (the ius gentium) provided many of these notions, which merchants modified to meet their special needs, as Bruce L. Benson pointed out in “The Spontaneous Evolution of Commercial Law” (Southern Economic Journal, 1989.)

In its early days the Law Merchant relied entirely on private adjudication and enforcement. Merchants conducted much of early international trade at fairs throughout Europe. At these fairs local authorities performed regular activities, such as preventing violence, but they didn’t normally adjudicate disputes between international traders.

Nor did authorities enforce the terms of private commercial contracts. International merchants formed their own courts for this purpose and applied their own law to these cases. Merchants’ courts came to be called “dusty feet courts” because of the condition of merchants’ shoes as they busily traveled between commercial fairs. In these courts merchants acted as judges, deciding the disputes of fellow traders on the basis of shared customs. Merchant courts enforced their decisions privately by threatening noncompliant traders with a loss of reputation and merchant-community ostracism. - from "The Law Merchant and International Trade" by Peter T. Leeson & Daniel J. Smith

There IS spontaneous order, and law, without Government. The word "government," however, should not be applied to such rules, any more than the pure bloody evil of the Inquisition should be used to characterize Christianity.

Recommended reading: The Most Dangerous Superstition by Larken Rose