First, I apologize for the delay in postings and I hope this hastily written post will foster some interesting discussion. (The 20 credit hour semester is difficult for proper Philosophizing!)
Political Libertarians face some problems. The majority of the problems come from attacks made by the political left but also by those on the political right. These problems are significant, but I do think that libertarians can hold their ground quite well. However, and perhaps much more of a problem, another problem for libertarians comes from within the movement itself. It might even be accurate to say that most of the people who call themselves political libertarians are not libertarians at all, they are merely small government statists. The real libertarians are the anarcho-capitalists. Only theirs is a political philosophy that is fully consistent and complete.
The problem for libertarians, maybe better described as an internal tension, is the frowning upon the state in markets. I mean to say that libertarians, and justly so, did not like the nationalization of General Motors or other similar situations where the government leaves the bounds of its proper functions. Those proper functions are the 3 Ps
To Protect Persons
To Protect Property
To Protect Promises
Anarcho-capitalists reject those three Ps as still immoral for the state to pursue for reasons irrelevant to this conversation.
What I am interested in is to provide a defense for the state to provide the legal services. I believe that the State ought to be the monopoly in legal systems and administrating punishment on at least capital crimes.
My argument is by analogy.
Lets take an example of the dispute between USA and Brazil over cotton. (The details are irrelevant) Brazil went to the WTO court, a private court with no military, aka no monopoly on force and coercion backing its decisions on sovereign entities, and won. What did the US do? The US continued with its existing cotton policy even in light of the WTO ruling against it. The US is such a large power that it can disregard the rulings of private court without any cost. And what can Brazil do? It can stop trading with the US, but that would hurt Brazil more than it would hurt the US since for the US the cost is insignificant while for Brazil it is large. The Brazilians can lobby other countries to stop their dealings with the US, but that is not in the self-interest of other nations to do and so most likely they would not do so.
In a similar sense, a legal system without a backing of government would be something akin to a trade association arbitration. It would only work if the self-interest of agents is great enough for them to impose the repercussions of the court on themselves. Yet we can certainly imagine certain individuals, irrational crazies, disregarding the ruling of the court and continuing their wrong doings, such as murdering, raping, stealing. At that point, individuals wronged would presumably pursue their own vigilante justice. Yet if the anarcho-capitalist concedes this point, what would have been the point in having a legal system at all?
It is because of this type of example that I believe that the state may be justified in maintaining its monopoly on the legal system.