White Versus Black Markets

Agorism is built upon black markets. Most people think of black markets as seedy back alleyways where you’re just as likely to be shanked by a seller as you are to die from the drugs they peddle. Meanwhile white markets are thought of as well-lit shopping centers where everything is guaranteed to be safe by an army of government regulators. Truthfully the difference between white and black markets is the former is under the control of the State and the latter is not. Nowhere is this difference better illustrated than in Samuel Edward Konkin’s rebuttal to Rothbard’s criticism of agorism:

With the side-excursion over, we turn to Counter-Economics, admittedly the basis of agorism and the New Libertarian Strategy. Rothbard finds NLM neglecting the “white market”—yet there is one crucial point on which it is most definitely not neglected, here or in my other Counter-Economic writing. The agorist imperative is to transform the White into Black. Nothing could be clearer. To do so is to create a libertarian society. What else can a libertarian society mean in economic terms but removing market activity from the control of the State? Market activity not under control of the State is black market. Market activity under the control of the State is white market and we are against it.

To illustrate, slaves building pyramids are white market. Slaves who run away, deal on the side stones and tools they ripped off, and otherwise engage in non-slave activity are black market—and free to that extent. What should the libertarian view be toward white-market pyramid building? Or, if you think pyramids would not exist in a free society but aqueducts might, what should our new be toward aqueduct building on the white market vs. black-market water smuggling? New Libertarians urge the slaves to screw the aqueduct and go for their private buckets until such time as aqueducts can be built under voluntary arrangements. Would Rothbard suggest anything else? Gradual phasing out of aqueduct construction and hence gradual phasing out of slavery?

If anything the white market is the seedy back alleyway where government agents wait to beat you to death with baseball bats. Consider the businessman who complies with each of the State’s numerous fee generating regulations only to fail to properly file his taxes one year. Quickly he will find himself face to face with a revenuer who will make him an offer: pay the demanded tax money and you may be let off with a fine and/or some jail time otherwise the alternative is death. I’ve not heard of a single “illegal” Mexican laborer going to somebody’s home, kicking in their door, and threatening to murder them if they fail to reroof their house again after three years.

The situation quickly changes when you’re dealing with the black market though. You no longer have to company with a laundry list of regulations designed only to extract fees from your business. Since you receive no official income from black market dealings you don’t have to decide whether you are going to pay taxes or have your kneecaps broken with a man with a baseball bat and a vaguely Italian accent.

All white market activity is slave activity. Although on the surface the rules have changed with most nation states replacing chattel slavery with, what I like to call, bureaucratic slavery the outcome isn’t dissimilar. White market actors are enslaved. Like serfs from feudal times, white market actors today must pay a percentage of their gains to the State. If they fail to do so they will be kidnapped and forced to labor in a prison or outright killed if they resist. Oftentimes people will make a remark like “If you don’t like it, leave,” but even that option can be taken by the State if you fail to hand over its demanded share of your efforts.

Ultimately what separates the white market from a black market is in the latter everybody is free to transact when they want with who they want whereas the former everybody is required to transact with the State under penalty of death.