Summary of “Free Private Cities: Making Governments Compete For You” by Titus Gebel: Free Private Cities is an innovative concept presented by the author as an alternative to traditional political systems; these Free Cities operate with private companies in the role of “public service providers” and ensure, on the basis of a voluntary contract and in exchange for an annual contractual fee, better freedom and protection of goods and individuals.
By Titus Gebel, 2020, 353 pages.
Review and Summary of “Free Private Cities” by Titus Gebel
Foreword to the Book “Free Private Cities”
The author, Titus Gebel, begins his book by explaining to us that:
- His objective is to “create a new market”.
- “Free Private Cities” is a book aimed at those who:
- Seek more freedom and self-determination.
- Aspire to reform existing social systems.
- Are aware that changes in this direction cannot be made through the electoral system.
The book is divided into 4 parts:
- The first part deals with the fundamental questions linked to any social structure.
- The second part describes the concept of Free Private Cities and studies models of companies that can inspire us to implement this concept.
- The third part addresses the creation of Free Private Cities in a concrete way.
- In the fourth part, the author presents his vision of the future and the possible developments of Free Cities.
Part 1 – Laying the Groundwork
Chapter 1 – Living Together
In this first chapter, Titus Gebel develops the idea that human cohabitation is a form of market: goods and services are, in fact, exchanged and are subject to the demand of the inhabitants. Human cohabitation is even, according to him, “the most important and the largest of all markets.”
However, at the very heart of this market, there is no competition. This is regrettable since, according to the author, establishing peaceful competition between states, conceiving the social order as a “product” and citizens as “clients” would go a long way in defusing political conflicts. Moreover, it is for this reason – with the help of technology and urbanization – that new systems of coexistence have, according to the author, a great chance of emerging in the 21st century. In his view, Free Private Cities will be part of it.
Chapter 2 – The Right to a Self-Determined Life
2.1 – A Minority of Individuals Decide for All the Others
Titus Gebel begins this second chapter of the book by listing a series of measures taken by the German government from 1957 to 2015. He then shows that each of these reforms was implemented by a small minority, as is always the case in traditional classical systems. The decisions:
- Are derived from the assessments and preferences of only a few, in areas that concern everyone.
- Are taken without the decision-makers taking the risk of being impacted economically: In the event that these decisions cause any damage, including financial damage, it is those who have not been authorized to take part in the decision-making process who bear the burden.
“From birth to death, rules are laid down without regard to whether those affected would make such a choice if they were allowed to make their own decisions. In principle, the whole system is based on A deciding what B and C have to do and what they have to pay to D (and A).”
Citizens, of course, are able to make decisions for themselves in many areas of their lives (food, clothing, car, friends, spouse, children, financial investments, insurance, travel, housing, hobbies, profession, causes supported, opinions, etc.). So, Titus Gebel asks: why couldn’t they also decide on their retirement, sources of energy, payment methods, political issues?
2.2 – The Citizens of a Democratic System Are Subjects
Through an extended metaphor (“automobile democracy”), the author explains how:
- An elected government actually imposes rights and duties, on everyone, even if these are not to everyone’s liking.
- All the issues of power and influence are really structured within a democratic system (lobbying, in particular).
- A system of double standards denounced by intellectuals is set up.
- Everyone ends up accepting this system and ultimately thinking that, although it has shortcomings, there is no better.
Finally, Titus Gebel, questions the rationale that pushes people to adhere to such a system:
“Taxpayers must fund grants for unprofitable technologies, public television and military missions abroad, chairs in gender studies and theology, even if they reject all of this. Citizens are still obliged to take out pension and long-term health care insurance, whether they want to or not. […] Why is that? And why don’t most people protest?”
2.3 – The Concept of Sovereignty
Titus Gebel then develops 4 main ideas concerning the concept of sovereignty:
- The sovereignty of the people is limited to adopting a constitution from time to time and participating in elections and referendums.
- It is not true that the only alternative to the democratic election of a government is codetermination or a dictator/monarch who reigns autocratically and without judicial oversight. Self-determination is also an option.
- States do not have to determine how we should lead our lives and should respect two principles:
- “The one who does not harm others has the right to be left alone, even by the government or the majority.”
- Human interaction must be based on a voluntary basis, not coercion.
- Freedom and coercive rule are not compatible: Individuals belonging to a state cannot violate state regulations. The author cites several examples which show that even giving up citizenship does not change anything.
2.4 – The Golden Rule
A universal Golden Rule known since ancient times is intended as a guideline for humanity:
“Do unto others what you want them to do unto you (positive variant) or do not do to others what you would not have them do unto you (negative variant).”
Thus, for Titus Gebel, if the Golden Rule was respected:
“There could be no institution, neither politics, nor religion, nor majority, which has the right to interfere in the lives of people against their will, in their own sphere, their lifestyle.”
The author adds:
“I am the only one who has the right to determine my life, provided that I also allow others to do the same. […] I can voluntarily delegate this authority and, for any reason, submit to political, moral and religious ideas or the protection of a leader, but any compulsion to do so is wrong. […] Whoever denies people the right to a self-determined life is quite simply authoritarian, even if he calls himself a liberal or a democrat.”
2.5 – Independent Communities to Live in a Self-Determined Way
To be able to exercise our self-determination, Titus Gebel proposes to supplement the current 200 countries with thousands of independent or partially autonomous communities.
- We could “vote with our feet” on bad systems “rather than having an immeasurably small influence at the ballot box every few years.”
- States would be forced to compete to attract customers “by presenting themselves as attractive service providers.”
- We could integrate new models of coexistence into existing states.
These new communities would offer, in a contract that cannot be unilaterally changed (as in other markets), and for a fee:
- Services: Security, case law, infrastructure.
- Rights and obligations.
- Other optional services to be chosen from the state service provider on a voluntary basis.
It does not matter whether these communities please everyone or the majority since, in the same way as in any contractual relationship, participation is voluntary.
Therefore, those who do not want this approach will be able to stay in the conventional systems. A system based on personal responsibility and self-determination may not be for everyone. It requires a certain leadership, guidelines, and a sense of purpose.
2.6 – The Sovereignty of the Individual
The concept of these independent communities implies that each is in principle “sovereign of himself”. This sovereignty of the individual is radically opposed to collective political or religious ideas, which obliges him to prioritize the common good or the divine order over his desire for a self-determined life.
Chapter 3 – Three New Countries – Prepared for Diversity?
In this third chapter of “Free Private Cities”, Titus Gebel asks us to imagine three new countries established on a continent which recognize the Sovereignty of the individual. These three systems of coexistence turn out to be completely different. However, despite this, they have two factors of success in common:
- Participation is voluntary.
- They do not adapt to the legal or moral systems currently in force.
Chapter 4 – Basic Questions of Human Coexistence
In this fourth chapter of “Free Private Cities”, Titus Gebel studies the motivations that lead people to adopt certain forms of coexistence and the role that institutions play. He wants to show us how “new systems of peaceful and effective coexistence” could be put in place without asking man to change.
4.1 – The Main Drive of Humans is the Pursuit of Well-Being
As long as his basic human needs are met, what motivates man above all in everything he does is the improvement of his well-being. This can be done through material elements but also immaterial elements (such as power, influence, knowledge, social acceptance). This explains why all representatives of the State (elected officials, politicians, civil servants, etc.), the Church and institutions of the common good seek to maximize their personal interests.
Based on this premise, several reasons explain the weaknesses of current political systems.
First reason: A failing incentive structure
For Titus Gebel, and contrary to what many claim, the welfare state cannot, in the long term, cover the risks of life such as hunger, disease, poverty and dignity for all. And this is because of the false incentives it creates. These false incentives are political, bureaucratic, and linked to fringe benefits. They:
- Encourage politicians, administrators, and beneficiaries to use the system to their own advantage.
- Make people less responsible.
For the author, the problem increases with the opening of borders and migratory movements: taxpayers leave the country (because of high taxes) while “those who do not want to work” emigrate to the country (incentives offered):
“As a result, the welfare state loses donors and in turn registers more beneficiaries.”
Second reason: The consequences of these misguided incentives
- Over-indebtedness: The welfare state is an indebted state; more and more payers are withdrawing from the system while the number of beneficiaries is increasing. This leads to a constant increase in public spending with, at the same time, declining economic growth. Finally:
“The welfare state is fighting more and more desperately the problems it has caused itself.”
- Pay-as-you-go systems: available funds are redistributed without anything ever being saved or invested. No profit is generated.
- Paternalism: for Titus Gebel, the welfare state is an authoritarian state where “the government orders what must be done, and the citizen must obey.” Control and paternalism continue to increase, thus restricting freedom to citizens.
- Antisocial behavior: For Titus Gebel, the welfare state creates ceaseless struggles for distribution, causing social conflicts. It replaces:
- Personal precaution with dependence.
- Responsibility with laziness.
- Philanthropy with the effort to “milk” the system.
- The desire to prove oneself with the search for unearned income.
- Gratitude with an aggressive sense of entitlement.
- Antisocial behavior: For Titus Gebel, the welfare state creates ceaseless struggles for distribution, causing social conflicts. It replaces:
Titus Gebel finally declares that nothing can justify exploiting others, not even bad luck or personal inability. According to him, social justice cannot be defined and always depends on our position in the system: “What right does A have to determine what B has to pay to C?”
Third reason: The minimum principle
The minimum principle is to want to get as much as possible with little effort. It is natural in individuals. Even though, in terms of human evolution, this principle does not pose a problem, that is not the case in terms of political power.
Indeed, according to the minimum principle, people will seek to improve their standard of living in the simplest possible way. Therefore, they will “take from others” by calling on a third party to do it for them in a legal manner, namely the State. This is, in fact, “the only institution which can confiscate with impunity the fruits of the work of others.”
According to Titus Gebel, this is why more and more social groups today are using state power, and not economic activity, as the main source of improving their standard of living. And in this dynamic, the possibility of leading one’s life according to one’s own choices is increasingly limited.
4.2 – Only Competition Can Limit Power
The author discusses here the various measures taken by men for several centuries in an attempt to limit political power.
The monopoly of violence
- History teaches us that in order to face foreign aggression and not be invaded or controlled, people must join forces. Thus, over time, a monopoly on violence has been established, held by an institution: the police and/or the army.
- The police have the exclusive right to prevent the use of violence against citizens. It is the only institution authorized to use force for this purpose.
- Normally, the state’s monopoly on violence is a source of peace. However, when the state uses its monopoly on violence for purposes beyond internal and external security, this is no longer the case. The victims of the state’s control must then accept what is imposed on them (without any possibility of defending themselves).
The author then urges us to think through two key phrases:
- “The problems begin when the state ceases to be an arbitrator and starts to become a player.” (quote from Ludwig Erhard)
- “To make politics means taking sides and making the wishes of some the yardstick for everyone, and we must not forget, if necessary, by force. How is that legitimate?”
The social contract
Citizens have voluntarily granted the state extensive powers in order to be able to live, in return, in safety. However, the author wonders: legally, can this alleged partnership agreement really be considered a contract? Indeed, we can ask ourselves the question because, in reality, this social contract is concluded:
- To the detriment of third parties who have not given their consent (it thus becomes, according to the civil law of most states, invalid).
- Without rules of reciprocity: the so-called “social contract” is constantly modified and is modified exclusively by a single party (namely the state) without the individual being able to do anything about it. The latter suddenly finds himself in a completely different system from the one to which he consented.
The rule of law and the constitution
- The rule of law: It is, in the author’s view, problematic, because it allows the one who controls the legislative power to establish any law. As long as he respects the procedures, he can therefore establish his own rules. Olivier’s note: there is also the notion put forward by Ayn Rand in his book Atlas Shrugged, which is that the legislator can put any person potentially outside the law simply by establishing so many laws that it is impossible 1) to know them all (the “no one is supposed to ignore the law” thus becoming a legal fiction intended to more effectively control individuals) and 2) to not be outside the law, since there is always at least one law that we violate without knowing it. The government can thus demonstrate a power reminiscent of a dictatorship, in all discretion, choosing to prosecute certain individuals targeted for violating obscure laws, while the majority of people do so unchallenged.
- Human rights: These concern areas central to the security and freedom of individuals (physical integrity, life, freedom of movement and action). The problem is that over time, “well-intentioned” people have added to these fundamental rights more and more so-called “participatory” rights (the right to work, to free education, to a humane existence with housing, clothing, medical care, “satisfactory remuneration”, etc.). However, according to Titus Gebel, these participatory rights can only be claimed at the expense of third parties (via an all-powerful state).
Democracy: Titus Gebel highlights several weaknesses of democracy. In a democracy:
- It is the majority of people with the right to vote who decide and thus impose their point of view on the minority which does not share them.
- We politicize all areas of citizens’ lives with ever more centralization, collectivism, and interference.
- Those who benefit from redistributive systems are more numerous than the contributors.
- By not suffering any disadvantage when making “devastating decisions” (they are, at worst, eliminated from parliamentary life but retain their pension rights), politicians are not incentivized to make reasonable long-term decisions.
- Anyone can vote in a referendum “for a stupid idea that costs” everyone, including those who voted against, and no one can ever be held accountable.
- Politicians are increasingly weaker intellectually: neither professional experience nor specialist knowledge is required.
Small size and subsidiarity
For Titus Gebel, the solution to remedy the weaknesses of democracy lies in the decentralization of power.
Titus Gebel mentions several examples here – Switzerland, small businesses, Singapore, Iceland, Liechtenstein, Monaco – to illustrate the value of small units. According to him, when a company/structure is large:
- Politicians, officials, and lobbyists are more likely to cluster around the center.
- Senior officials act for selfish reasons.
- Control is no longer possible, and the profits are spent on organizational equipment.
Conversely, a small state:
- Is not “synonymous with isolation or provincialism”, but rather self-government, “principle of subsidiarity”, robustness and “anti-fragility of the system.”
- Prevents a single state (or a group of states) from becoming too powerful.
- Brings more competition (in particular, by allowing citizens to easily change systems).
Finally, for Titus Gebel, neither the separation of powers, nor the rule of law, nor human rights, nor democracy have proven effective in limiting power in the long term. In fact, for the author, competition is humanity’s only known permanently effective means of disempowerment.
4.3 – The Five Levers of Prosperity
Based on reciprocity and exchange, voluntary cooperation enriches all participants: “the gain of one is not the loss of the other.” It is a basic prerequisite for prosperity. For Titus Gebel, this voluntary cooperation remains valid even when one of the participants in the exchange is in need and the other is not. Indeed, the one who sells his goods or his labor at very low prices out of pure necessity considers “starvation wages” better than no wages, “small sales proceeds to no proceeds.”
For the author, private property is the sole countervailing power of the individual against the power of the state. Moreover, property promotes:
- Responsibility: In addition to feeling pride and satisfaction, on a property, we are responsible for the consequences of our actions and therefore generally make wise decisions.
- Independence: It compels us to secure our own existence, to build and maintain a family, to develop our personality.
- A market economy: Owners can make multiple independent decisions about the supply of goods and services and the related expenses.
The author emphasizes that the right to property can, on the other hand, have devastating consequences if it:
- Is in the hands of only one body.
- Is subject to too many bureaucratic obstacles.
- The power of its disposition is restricted (by law or by high taxation).
Improvement in standards of living
For Titus Gebel, a person who wants to make a living “must produce and offer goods or services for which others are willing to pay voluntarily.” If he wants more, he has to work, save or borrow money to invest in new products and services to offer.
The profit requirement
In the process of the voluntary exchange of goods and services, profit cannot be banished. Because, in addition to being a motor of progress (reduction of disease, mortality, hunger), the search for profit is a source of cooperation, division of labor (in particular for the benefit of the poor) and prosperity. Resources are used to create products, services, jobs that improve the standard of living in the world and therefore enrich all parties concerned.
In this respect, the author considers that craftsmen, self-employed workers and entrepreneurs are in themselves “social” since they provide society with goods and services that would not otherwise exist.
Although a minority, entrepreneurs and innovators play a key role in society:
- First, they give their fellow human beings what they need.
- Then, unlike the state, no entrepreneur can force people to buy their products or services. He has to win over customers with quality and price.
Yet the freedom to do business is severely restricted in most states (labor laws, import and export rights, restrictions on contractual freedom, minimum wages, anti-discrimination laws). This regulation makes it very complicated to take up commercial or self-employed activity (and even more so for the weak).
Titus Gebel explains that he is in favor of entrepreneurial freedom (accommodating rights and conditions rather than restrictions) with the entrepreneurial responsibility that this entails.
4.4 – Religion
Religion and secularism: two contradictory systems
For Titus Gebel:
“Religion is not a problem for a society if it is presented simply as a private spiritual matter which gives the individual strength and meaning in his life.”
In this case, regulation is unnecessary. Besides, a free society does not interfere with private beliefs. On the other hand, the author continues:
“As soon as a religion demands privileges for its members or the observance of certain rules by non-believers, it (in addition) becomes a political ideology. That is where the problems begin. Because then there are two systems of regulation face each other, namely the religious and the secular.”
And when two contradictory systems coexist, “one will always prevail.” “And it is usually the most violent one, and not the more morally or intellectually appealing,” the author concludes.
The question of Islam
Titus Gebel explains that in the religion of Islam, nothing separates religion and society. The Islamic faith, law and way of life are based on the set of rules of Sharia. In other words, divine law takes precedence over human rights. This then poses a challenge to secular societies on how to deal with Muslim immigrants.
The lasting solution for Titus Gebel is to institutionalize a reformed Islam. This approach necessarily requires to:
- Privatize faith and accept the separation of religion and politics.
- Recognize the primacy of unrestricted secular laws.
- Renounce the use of force to achieve religious goals.
- Acknowledge the legal equality of other religions and allow criticism of the faith and of the prophet.
4.5 – Borders
Another crucial issue for all social systems is that of border security and immigration control. Thus, for the author, the opening of the borders is not desirable because borders:
- Are a guarantee for internal and external security of a society; they have a pacifying effect.
- Protect acquired rights: Immigration affects all infrastructures and services; it represents a partial expropriation of the population when it is against the will of the resident population.
- Maintain social harmony by helping residents share common fundamental values.
Therefore, Titus Gebel believes that it is essential to pre-select immigrants and concludes:
“A society can of course choose to accept unqualified immigrants of all kinds for humanitarian or other reasons. However, this is then an autonomous decision of the host society, and not a legal claim of the immigrants. Even their motives, such as political asylum, cannot change this principle. In this regard, too, there can be no right to live at the expense of others.”
4.6 – The Key Factors Which Unite Societies and Ensure Their Proper Functioning
For the author, it is unrealistic in mass societies to treat people differently according to each situation of life. The only solution is then to put in place the same rules for everyone, without taking into account the specificity or the position of the people. And because human beings are unique and diverse, each individual will be able, if given the freedom to do so, to benefit from their own abilities.
Justice and the common good
All people are different. Everyone has different values, interests, and a subjective opinion. In that respect, there can be no “common good” beyond the satisfaction of fundamental needs or objective justice.
Based on this principle, Titus Gebel believes that there is no reason to act “for all of us.” The objective is rather to avoid arbitrariness and to respect the principle of equal treatment of citizens, particularly before the law.
Common identity and cohesion
According to Titus Gebel:
“Communities that share a common identity, whether based on ancestry, culture, language or religion, or even all of them together, have an easier time creating social harmony.”
However, social harmony within a society is, the author tells us, a significant source of social and economic cooperation. In other words:
- The more different people are, the more difficult it is to cooperate.
- The common identity is imperative for the proper functioning of a society.
The author specifies, however, that ethnic homogeneity is not always crucial as long as there is a guiding culture that is imposed on everyone and that individuals have integrated into it (this is particularly the case of United States). To achieve this integration, communities have three options:
- Only accept people of a certain ethnic, cultural or religious group.
- Attempt to establish a new common identity.
- Accept the different groups but, in this case, take measures so that the relations between the groups remain stable (Ex: Singapore, Dubai).
Chapter 5 – Conclusions
“To avoid problems caused by human ambition, we give more power to certain humans; this cannot work in the long run.”
“The respective leaders do not bear any economic consequences for their decisions, remain legally immune from any liability and have no enforceable obligation towards the ruled. […] If governments go too far, they are either voted out of office (in democracies) or overthrown (in autocracies and dictatorships). Then a new government comes along, and the same game starts all over again.”
To conclude the first part of the book “Free Private Cities”, Titus Gebel recommends us here to study new mechanisms to limit this power. Here is a summary of his recommendations.
5.1 – Remove Power from Politics
In democracies, there is a constant struggle over who is going to exercise politics.
The combination of the minimum principle, non-responsibility and the “herd mentality” leads democracies, over time, to create more and more totalitarian rules and to run out of money. Such systems therefore destroy themselves over time and cannot last.
“The only remedy is to remove power from politics in general.”
5.2 – Set Up a Genuine Social Contract
There is nothing citizens can do about the constant and unpredictable changes of governments. The continual and increasing introduction of regulations is a constant source of uncertainty for both businesses and individuals.
A genuine social contract would in reality require:
- The prior consent of all.
- To be precise and not unilaterally alterable.
Redistribution systems can be organized but only with the consent of the payers.
5.3 – Granting Extensive Personal and Economic Freedom
It is crucial to grant extensive freedom to individuals. This freedom:
- Is limited to the freedom of others and the regulatory framework (Golden Rule).
- Applies to economic and individual freedoms (not forcibly redistributing, not granting privileges to certain people).
- Includes responsibility and liability for the consequences of one’s behavior.
5.4 – Guarantee of Private Property
It is essential to allow private property to individuals and to restrict it as little as possible:
“Without property there is no free pricing, no incentive to create anything of lasting valuable for oneself or one’s family, no peacemaking effect and no commitment to a particular community.”
5.5 – Establish the Rule of Law and Equality Before the Law
The author offers three suggestions:
- “The rules must apply to everyone, including those in power and those who run the society”: only a valid reason can justify a difference in treatment.
- Religion remains a private matter; its practice is free but does not allow any privilege.
- “Less is more”: the more rules and laws there are, the greater the risk that they will not all be respected and create loopholes that can be exploited by knowledgeable people.
5.6 – Foster Competition through Small Size and Subsidiarity
The best solution, according to Titus Gebel, to limit human power is competition. To promote this competition, the author identifies three conditions.
Communities should not exceed a certain size
The risk otherwise is:
- To make control and compliance with rule/procedures very difficult.
- That decision-makers are too far removed from the real issues to make appropriate decisions.
It will therefore be necessary:
- To either divide the community when it exceeds a certain size,
- Or to introduce additional levels of autonomy.
Communities must be multiple and diverse
Diversity is a source of evolution. Therefore, it is essential to allow alternative forms of society and then not to prevent people from leaving the system.
Community members must live there of their own free will
Anything in demand is permitted as long as participation is voluntary.
5.7 – Enable Defense and Cohesion through Consensus on Values
Living in peace together requires a consensus regarding respect for the rules of the community. For this and to avoid the constant struggle for power, there is no other solution than to:
- Geographically separate incompatible worldviews (systems, on the other hand, have the occasional opportunity to cooperate and trade commercially with each other).
- Expel those who oppose it.
5.8 – Set Up the Right Incentive Structure
New approaches should be designed with leaders who:
- Have an economic interest of their own in the success of the society.
- Will be held responsible in case of errors (power/responsibility).
- Allow community members to leave or secede at any time without hindrance (allowing competition).
- Do not grant special benefit to groups/citizens (thus avoiding lobbying, corruption, and distribution struggles).
- Have well-defined obligations and powers that cannot be unilaterally changed (legal certainty, predictability).
- May be the subject of legal action in the event of disputes before independent courts or arbitration bodies (neutral arbitration).
Part 2 – Concept of Free Private Cities
In the second part of his book, Titus Gebel presents us in detail what the new concept of Free Private Cities is and how it overcomes the downwards slides of the existing democratic systems described in the first part.
Chapter 6 – The Free Private City as an Alternative Order
“A Free Private City is not a utopia, but rather a business idea whose functional elements are already known, and which are simply transferred to another sector, that of living together.”
6.1 – The Main Characteristics of a Free Private City
The City is a sovereign or semi-autonomous local authority
It has it’s own:
- legal and regulatory framework.
- tax, customs, and social regime.
- security forces.
- (independent) dispute resolution system.
The City is run by an operating company
Like a for-profit enterprise, this operating company guarantees the resident protection of life, liberty, and property in exchange for a fixed financial contribution.
This takes the form of entering into a written agreement between the future resident and the operating company in which the rights and duties of each are stipulated (services provided by the operator, sum to be paid by the inhabitant, rules to be applied in the City).
Other characteristic elements of Free Private Cities
Other essential points stem from the two postulates:
- Participating and residing in the Free Private City is a voluntary act.
- The operator freely decides on the admission of its residents to the City according to its own criteria (no regulations).
- The contract cannot be modified unilaterally.
- The inhabitants can do whatever they want, as long as they do not infringe the rights of others or other rules mentioned in the contract.
- All adults are responsible for the consequences of their actions.
- Each inhabitant can break his contract and leave the Free Private City at any time; however, the operator can only terminate it for good cause (breach of contractual obligations).
- In the event of conflicts with the operating company, citizens can request independent arbitration courts (excluding the operator).
- To ensure voluntary participation, the area is ideally uninhabited initially.
6.2 – The Autonomy of Free Private Cities
To function, internal autonomy is necessary within Free Private Cities.
Contracting with an existing state
To allow this autonomy, the Free Private City must establish a contractual agreement with an existing state. In this contract, the host state authorizes the operating company to settle the City on a defined territory.
The four guiding principles of coexistence
- Self-determination and private autonomy.
- The Golden Rule: “Do not do unto others what you would not want them to do unto you.”
- The principle of do ut des (“I give so you give”), in other words the recognition that merit is based on reciprocation.
- Voluntary cooperation.
To guarantee compliance with these rules, the Free Private Cities:
- Can exercise coercive measures (in the event of serious or repeated violations, exclusion from the Private City can be decided).
- Ask their citizens to be responsible, mature, and resourceful in the face of difficulties.
Decisions in the City
If everyone is free to decide what they want to do and how they want to live, there is no real need for participatory bodies. However, if they wish, the inhabitants can absolutely choose to be represented (by a municipal council for example). On the other hand, the author points out, “even if 99% of the population participates and submits voluntarily to the decisions of the majority, this body does not have the right to impose its ideas on the other 1%, which does not want to have anything to do with it.”
The City operator’s profit requirement
The operator of the Free Private City wants to earn money; it is clear, and it is of central importance.
The incentives are therefore not at all the same as those of a politician in conventional systems. Indeed, competition and the need to make a profit encourage the operator of a Free Private City to continuously improve its product, increase customer satisfaction and use resources optimally. In addition, his decisions have an immediate impact on his business.
6.3 – Life in Free Private Cities
Titus Gebel describes to us the life we could benefit from in the heart of a Free Private City. Here is the summary of the main points:
- Innovative service providers like Uber or Airbnb are encouraged.
- These are private entrepreneurs who manage hospitals, schools, kindergartens, garbage collection, etc.
- To deal with life’s contingencies (illness, death, accidents, etc.), residents can take out private insurance or create support groups.
- Shopping centers, roads, ports, etc. are built and operated by investors.
- Anyone can sell new products/services without authorization or license and can get paid with any desired currency.
- There are no regulations regarding the minimum wage.
- It is a free trade system: possibility of importing cheap products from all over the world, no tariffs, etc.
- The new drugs and treatments are available to any adult who wants them (knowing the potential risks).
- Environmental thresholds only apply to products and processes considered to be truly dangerous by sound scientific research.
- Freedom of expression is essential.
- The community defines its own immigration rules (positive selection); once you become a resident, no visa is required.
- The studies are financed by the one who wants to study: this encourages the student to choose a course with a real demand.
- Crime, vandalism, political activism, “missionary zeal”, distributional struggles have all but disappeared.
- People have once again the responsibility of taking care of themselves; they are more stable and more realistic in their evaluations.
The author concludes this chapter as follows:
“After two generations at the latest, Free Private Cities would be wealthier, freer and more peaceful than anything we have known so far.”
Chapter 7 – The Advantages of Free Private Cities
The advantages of Free Private Cities benefit individuals, businesses, and existing state governments alike.
7.1 – Legal Certainty, Reliability and Predictability
In a Free Private City:
- The operator of the City is subject to its contractual liability and can be sued in the event of default.
- The resident only pays what he has requested under his contract and can benefit from damages if the operator does not respect the contract.
- The rules can only be changed by mutual agreement or within the framework of contractual mechanisms.
- The same laws apply to everyone, regardless of the differences between people.
7.2 – Political Absence and Abstinence
Free Private Cities are apolitical societies (apart from their relations with the host state and the outside world).
Therefore, in the City:
- No one imposes their own values on others.
- It is possible to launch voluntary initiatives, to create associations.
- Entrepreneurs focus on serving the market and no longer waste their energy putting in place complicated tax saving systems or avoiding unfavorable measures.
- The deflation of productivity gains allows the accumulation of assets, retirement provision and better purchasing power for all.
- Innovation and new discoveries are fostered by a “trial and error” approach, now possible since there are no longer political decision-makers who seek to gain power and influence by going along with the alarmists and skeptics.
7.3 – The Guarantee of Freedoms
Free Private Cities grant the greatest possible freedom of action, contract, and opinion. This freedom naturally entails greater responsibility (people cannot rely on the “big brother state” to bear the consequences of their actions or to relieve them of their life risks).
7.4 – Safety and Security
In a Free Private City, the operator strives to provide maximum security and protection as citizens may otherwise claim damages. The operator can do this by expelling delinquents and criminals.
7.5 – The Guarantee of Private Property
In a Free Private City, it is possible to acquire real estate without obstacles, obligations, and taxes.
7.6 – The Limitation of Power through Diversity and Competition
“The citizen is at once a courted customer, who can change suppliers at any time, instead of a fenced in milking cow, which must buy his departure through an exit tax.”
The existence of many and various Free Private Cities in the current states brings healthy competition. It brings:
- An improvement in the quality of public services and a reduction in prices.
- Different models of living together for everyone’s tastes, via Specialized Free Private Cities (mass market, luxury, specific for ethnic, religious, or ideological groups, etc.).
7.7 – Room for Experiments
The problem with a society is that often changes are difficult to implement politically, culturally or for religious reasons. For a state or a government, Free Private Cities are then the opportunity to test controversial reforms on a small, demarcated territory without incurring significant risks or consequences:
- If the proposed system works, it will then be possible to enlarge the territory or to reproduce it.
- If the whole population is not for it, or if it does not work, a simple special zone can be created.
7.8 – Social Harmony through Shared Values
The Free Private Cities gathered around common values will themselves be more homogeneous, but all the Free Cities as a whole will ultimately offer a wide variety of societies. Moreover, new forms of cohabitation could be tried out: the proposed ideology would then become one product offer among others. In the end, the forms of cohabitation that work and are accepted remain, while others collapse.
7.9 – Better Incentives
Incentives for the operators of Free Private Cities are fundamentally different from those in current states. Indeed, the operator:
- Has a direct economic interest in the success of the City.
- Bears his own risk because he can be held responsible for errors without the possibility of concealing his responsibility or transmitting it to third parties.
- Must face direct competition and must therefore attract his customers solely by the attractiveness of his product.
Chapter 8 – Objections to Free Private Cities
In this chapter, Titus Gebel responds to objections regarding the concept of Free Private Cities.
8.1 – “It Won’t Work”
Security: Even if independent, Free Private Cities will be taken over by the host state at the first opportunity.
Free Private Cities will do everything to avoid such a situation (by combining public relations, diplomatic contacts with other states, a great defense capacity, etc.). In addition, the host state:
- Has signed a contract with the City operator: in the event of non-application of this contract, it is therefore exposed to considerable financial claims.
- Knows this would cause residents to leave.
- Could put itself in danger (in any case its leader) because the potential world stakes of such a situation would probably bring world powers to enter the scene.
Law enforcement: No one is able to enforce judicial decisions against the operator.
The law can be enforced through:
- Property registers, courts, and arbitration bodies.
- Bodies responsible for the application of the law of the Free Private City.
Cohesion: Systems that have no ethnic, cultural, or religious cohesion are not sustainable in the long run.
In Free Private Cities, cohesion can be nourished by a culture of its own, which will develop over time thanks to common values (as was the case for the United States). We can also note that Dubai and Singapore exist to this day without any means of cohesion.
Changes to the contract: Changes to the contract and adaptations to developments will, at some point, be inevitable and will lead us to adopt, again, conventional systems (in an authoritarian manner or via participation bodies).
The author cites the example of credit cards to show that regulations that are in the best interests of individuals can be implemented without court intervention or contract modification in many areas of life. Otherwise, it is also possible to offer new citizens contracts different from those offered to previous inhabitants.
The regulatory deficit: In our current world, which is increasingly complex, such a minimal state can no longer function; it requires complex rules.
The approach of Free Private Cities is to counter the hyper-complexity of today’s world and all its side effects (such as abuse and exploitation). For this, they can only choose a simple regulatory framework.
The market: “Living together”, the political, religious, love or science domain are not markets; states cannot therefore be run like businesses.
Conventional states may not be able to be run like businesses, but Free Private Cities must be run like businesses because they create a supply for a presumed demand in a market.
Insolvency: Residents’ life projects will fail when municipal operators go bankrupt.
In the event of the operator’s insolvency, a competitor or the inhabitants will be able to take over the City themselves, as is the case for any other business (“resident buyout”). Moreover, this insolvency allows a new regulated and debt-free start.
8.2 – “I Don’t Like It”
Free riding: Free Private Cities use host state infrastructure and military protection and could not exist on their own.
Almost no state in the world is truly self-sufficient. This is not a problem as long as reciprocation is ensured for the services used. And then, over time, Free Private Cities will normally acquire sufficient infrastructure and defense capacity.
Dictatorship: The operator of the City is a dictator; the inhabitants are at his mercy for better or for worse.
The operator’s skills are limited to the areas of the contract. However, the loss of economic interests is a great source of dissuasion for the operator to act as a dictator: most of the citizens would leave the City; it would tarnish his reputation and could no longer establish new Free Private Cities elsewhere.
Segregation: The whites who are rich flee into the ghettos of their Free Private City and evade their responsibilities.
Everyone has the right to decide who they want to live with. Otherwise, it is a totalitarian approach. Regarding responsibility to others, the author adds:
“Each individual is of course free to feel a moral obligation towards complete strangers. However, no objective obligation can be derived from this. […] If the allegedly disadvantaged person is not helped now, he has an incentive to strive on his own and to develop his existing strengths, which he may only then discover to conquer his place in life.”
Exploitation: In the absence of a welfare state and the rules of protection that go with it, the weak will be exploited by the strong.
There is no exploitation since individuals voluntarily come to a Free Private City. Exploitation is when we deny people the right to make their own decisions. In addition, weak people will not be defenseless: the civil law system protects them, for example, from “surprising clauses in contracts”.
Exclusion: If Free Private Cities are established all over the world, the weakest will, in the end, no longer be accepted anywhere.
To the extent that a person is able and willing to work, and has the will to adapt, he will be accepted. The idea is that there are specialized communities, for the low-wage sector for example. Those who are “incapable” because of a handicap, disease, or other incapacity, according to the author, represent no more than 5% of the population, and history has shown that they benefit, most of the time, from charitable help.
Global problems of mankind: The protection of the environment and the climate will not be solved by Free Private Cities.
The regulatory regime for Free Private Cities will take this aspect into account.
Egoism: Free Private Cities divide society and polarize it. By settling in a place according to their own individual desire for a better life, people will only find themselves among people who cannot think in a different way from theirs.
Man is “a herd animal.” In this sense, the voluntarily formed groups will indeed be homogeneous. And that is why a multitude of different models must be recommended: it is competition between systems which, in the end, will generate the evolution of society. Regarding egoism, the author’s response is that “the individual desire for a better life is not only legitimate, it is the reason for all progress of mankind so far.”
Chapter 9 – Old and New Models
In this chapter of Free Private Cities, Titus Gebel analyzes at length different models of political systems of very prosperous existing (or having existed) city-states. Then, he enlightens us on the common points between these communities to better understand the decisive factors of their success.
9.1 – Study of the Different City-States
- The Greek city-states of the ancient world (circa 800 B.C. – 700 A.D.) AD): These cities experienced a long period of prosperity; what they achieved culturally has impacted the world continuously until today. This success is linked to aspects that could apply in Free Private Cities:
- Competition between systems (leading to constant technical and institutional innovation).
- The decentralized structure of the communities (guaranteeing political stability).
- Reliable rules and civil rights (making investments possible and keeping transaction costs low).
- The free imperial cities of the Middle Ages (around 1100-1800): The author describes in particular the powerful alliances that these cities were able to form, such as the Süddeutscher Städtebund (Association of cities in Southern Germany) or the Hanse (Hanseatic League).
- Venice (697-1797): The city was an immense international power (economic, commercial, military, diplomatic, etc.) when it was independent.
- The Principality of Monaco (since 1297): Through its size, its privileged relations with France and its solutions in terms of security, immigration and financing of public expenditure, Monaco can serve as an example for Free Private Cities.
- Hong Kong (since 1843): The development of Hong Kong is an example of how a city-state can grow from a simple liberal system to enormous size and prosperity.
- Dubai (since 1971): The city has exploded in 50 years to become one of the most attractive cities in the world, both for its residents and for its businesses (numerous social and tax benefits, etc.).
- Singapore (since 1965): This city benefits from extremely favorable living conditions on all levels (personal, professional, entrepreneurial) and one of the most advantageous economies in the world.
- Sandy Springs (since 2005): In this non-autonomous American city, private companies provide municipal services.
9.2 – The Lessons
Titus Gebel highlights here the common success factors that he identified in these free city-states. Thus, the key points that emerge from the author’s analysis are:
- The voluntary aspect: A community is successful when many people want to live there voluntarily over a long period of time.
- Free trade: The market economy is as minimally regulated as possible.
- The choice of its immigrants according to the needs or the specifications of the City: No opening of uncontrolled borders for all.
- The absence of democratic codetermination, or very limited: Each inhabitant personally analyzes the costs-benefits (more economic freedom and more security for less individual freedoms, more self-determination for less participation, etc.).
- Right wing state.
- A strong defense and armed forces that are accompanied by appropriate political independence, good relations with its neighbors and the avoidance of conflicts.
- No tolerance for intolerance: Social harmony depends on the rules of coexistence; some are not negotiable and are therefore strictly enforced.
- The example of Sandy Springs shows that it is easier and more sensible to create Free Private Cities on previously uninhabited territory (rather than seeking to convert existing communities).
- The Free Cities of the past show that the criminal prosecution and detention of criminals cost citizens money (already harmed by the crime suffered): To minimize these costs, other procedures are employed and can serve as models for Free Private Cities(no prison sentences for minor offenses, payment of a fine or work performance, ban from the city).
For Titus Gebel, these methods have been proven and can therefore help, at the beginning, to establish Free Private Cities. Then, the Free Cities will be able to follow the evolution of the market.
Chapter 10 – Highlights of Private Regulation
For Titus Gebel, nothing suggests that without state laws, there would necessarily be an anarchic state. Because according to him, the rules can be respected by people of their own accord simply because they are meaningful to them or because they are the result of practices.
To illustrate this idea, Titus Gebel cites several examples that show that private regulation that does not pass through any government is, in fact, much more widespread than one might think, and it works. He mentions in particular:
- The fraud prevention system developed by PayPal and has become, over time, a benchmark standard in the industry.
- The operation of Uber which solves the most common practical problems (hostile drivers, refusal of short trips, bill fraud, insufficient number of cars during rush hour), without the need for state regulation.
- Credit card companies capable of regulating very complex payment transactions.
- The private security services of amusement parks to which people willingly submit.
- Cruise ships: On the high seas (outside territorial waters), passengers are not subject to the laws of their state of origin or of the state off which they sail. The captain then holds a supreme executive power and ensures, with his staff, the safety of people, goods, the settlement of disputes as auxiliary services to the cruise in exchange for paying customers.
Chapter 11 – Special Zones and Other Variations
In this chapter, Titus Gebel explains how, if it is not feasible to implement a private administration, it is always possible to implement at least some aspects of the concept in particular areas.
He first analyzes the possibilities of implementing the advantages and disadvantages of two types of systems:
- Systems with a little more state intervention than that provided for in the concept of a Free Private City.
- Systems with a little less state intervention than that provided for in the concept of a Free Private City, as is the case in the already existing non-governmental systems (special zones and de facto Private Cities).
Finally, the author mentions another variant of special zones: Migrant Cities.
11.1 – Special Zones
- The concept
The aim is to adopt at least certain aspects of the concept of Free Private Cities and to apply them in a so-called “special” zone. The special zones:
- Are located within national territories with little or no population (so as not to impose anything on anyone).
- Have their own economic and political rules.
- Are in competition with each other and with the parent state which retains its previous regulatory regime.
They also enable to:
- Observe which models work and which do not.
- Offer an alternative to an unsatisfied minority.
- Attract investors (tax breaks, investment protection, exemption from customs duties, less stringent regulations for companies) in the same way as the special economic zones that already exist.
- Dubai International Financial Center: Founded in 2002, it is an intermediary form between the special economic zone and the special administrative zone.
- Abu Dhabi Global Markets Special Zone established in 2013.
- The ZEDEs of Honduras: Created at the initiative of individuals and national or foreign companies, these zones appeal to the parent state, which hopes to attract foreign and national investors, create jobs, accelerate economic development and improve the quality of life of Hondurans.
- In the maritime zones of the Pacific, in French Polynesia, a model similar to the ZEDEs is being created.
A special zone can take different forms and therefore various names: It can be a free zone, a special administrative zone, a special economic zone plus or a super economic zone. Special zones for particular themes can also be created: Special zones for crypto, social security, innovation without authorization procedure, immigration, etc.
11.2 – De Facto Private Cities
- The concept
It is also possible to create quasi-private Cities:
- Consist of establishments built on private property: the landowner and the resident sign a contract in which it is stipulated to respect the rules of the City.
- State laws continue to apply, but this arrangement offers residents a more pleasant coexistence and leaves them the possibility of establishing their own parallel systems in the field of education, social security, their currency.
- Applicants are admitted on a positive selection (as do the Amish in North America or the Mennonites in South America).
- The American Home Owner Associations.
- Private regulated Cities like Weston or Celebration in Florida.
- Libertarian start-ups like the Norwegian project Liberstad.
11.3 – Migrant Cities
For Titus Gebel, the growing number of migrants makes conflicts inevitable in the future. Migrant Cities, based on the Free Private Cities model, are therefore a potential solution, Gebel contends. These Cities offer what is lacking in emigration countries for their economic development, namely:
- A reliable legal framework.
- The possibility of acquiring real estate.
- The right to import and export goods.
- Facilities for setting up businesses.
- Guarantee a secure life, a new community, and economic opportunities for migrants in their own culture.
- Attract businesses and service providers from neighboring regions and around the world.
The establishment of such a city requires an agreement between the operator of the City, the host state and other signatory states as guarantors of the Migrant City.
The author then explains the functioning of these Cities in detail. Some key facts are as follows:
- The parties are committed to apply human rights and international agreements.
- Neutral, the Migrant City refrains from intervening in external conflicts.
- External security is the responsibility of international security companies.
- The citizens renounce the use of violence and show tolerance towards those who have a religion and different opinions (if these rules are violated, the resident is expelled from the City).
- An annual fee is paid for the service provided by the city operator with some possible adjustments (postponement of contributions, for example, for newcomers without resources).
- The inhabitants are ready to work and to contribute significantly to the emergence of the city; incentives should be designed to foster the establishment of highly qualified people, entrepreneurs, and investors.
- The City must be able to select its inhabitants in order to “achieve a healthy mix of quantity and quality.”
Part 3 – Implementation of Free Private Cities
In this third part, Titus Gebel details how Free Private Cities could be implemented in practice and goes on to explain how they function in all aspects.
Chapter 12 – The Creation of Free Private Cities
For Titus Gebel, it is essential to create these Free Private Cities (and not just describe them) if we want to convince the world of their advantages.
12.1 – Benefits for Host Countries
States will only relinquish their sovereignty over part of their territory if they can profit from it. This is also the case for the city-states of Hong Kong, Singapore, and Monaco. The city-states:
- Provide a belt of prosperity to their neighboring countries: taxes, job creation for cross-border workers from neighboring countries, etc.
- Are the chance to test new opportunities without having to change the political system of the host state: For the latter, it is then possible to try alternative ideas without encountering opposition in order to change their own country.
12.2 – The Agreement with the Host State
A Free Private City is unlikely to be able to negotiate full independence from the host state. Indeed, in addition to territorial sovereignty (defense, foreign policy), the latter will probably want to continue to apply certain legal standards (human rights enshrined in its constitution, international agreements, penal codes). Thus, Titus Gebel cites examples of interests which are likely to come into conflict with those of the host state. He advises that these should therefore be thought out and regulated in advance so that the host state is not harmed.
However, certain autonomy rights cannot be negotiated because a Free Private City is only viable if it offers a competitive advantage. Thus, the Free Private City must retain the power to:
- Regulate business and commercial law.
- Implement its own tax, customs, and social regime, independent of host state regulations.
- Acquire goods in accordance with the rules of the Free Private City.
It should also:
- Have its own police services, justice, and its own administration.
- Be able to guarantee fundamental freedoms (freedom of expression, of assembly, equality before the law), even if this is not the case in the host state.
- Have the right to expel unwanted persons or deny them entry, even if they are citizens of the host state.
- Provide special protection for investments by contract.
12.3 – Conflict Management
Despite the written agreement with the host state, there may be differences of interpretation in the content of the contract. In addition, new questions will inevitably arise over time and may lead to conflicts of interest. The author therefore recommends that the two administrations plan regular meetings to deal with problems as soon as possible. In the event of a dispute, an appeal must be made to an internationally recognized arbitration court.
12.4 – Previous Residents
The author then addresses the issue of previous residents. This situation should be an exception since Free Private Cities should ideally be located in uninhabited areas.
If these people do not wish to sign the citizenship contract like the new settlers, Titus Gebel offers various solutions, but none of them are optimal : leave the territory in exchange for compensation, remain subject to the previous legal and executive system, be compelled to adhere to the contract with amenities (like a neighborhood of their own), etc.
Chapter 13 – The Legal System
The rules of this system are based on strict reciprocation and equality. Unlike the system in place in most countries of the world, which is based on public, private and criminal law, Free Private Cities offer “private administrative law.”
With regard to the concept of Free Cities, public law does not have to exist: the rules are fixed in the Citizens’ Contract; they cannot therefore be extended unilaterally by the operator.
“The operator does not have a legal position which goes beyond that of a service provider and which can be reviewed before ordinary civil courts or arbitration courts.”
In the event of violation of these laws, private law damages will have to be paid, except for certain acts which will require the termination of the contract, community service, imprisonment or in any case to be treated as criminal offenses (refusal to compensate victims, serious acts such as serious injuries, murder or rape)
Finally, the author details certain points such as:
- The principle of free choice of law and jurisdiction (host state or country of which the citizen is a national).
- The choice of the private law system (civil law or common law).
- The enforceability of judgments (injunction measures via an independent bailiff).
- The question of personal registers, companies, and properties.
- Integration of the law of the host state.
Chapter 14 – Public Order
The private law system used by the operator takes care of the most expected conflicts of interest. However, a framework with rules of coexistence, in other words a public order, remains necessary:
“In addition to rules of practicality, this also includes rules that reflect the common basic convictions of the residents, a kind of non-negotiable set of ‘house rules’.”
Thus, in the interest of its customers and with the objective of attractive urban development, the City operator:
- May establish specific rules for construction, traffic, occupational safety, the environment, or concerning certain activities and hazardous substances.
- Establishes rules of cohabitation in order to increase the quality of life of the community and create social harmony.
- Must take into consideration the requirements of the host state and respect certain restrictions granted in the agreement with the latter.
Titus Gebel emphasizes that:
- The rules will be known before the contract is concluded.
- Some differentiations are possible but, overall, the idea is that the Public Order is uniform for the entire Free Private City.
- As everyone has their own opinion of the rules to apply, it is judicious that people can choose to benefit from different social orders through different Free Private Cities.
Chapter 15 – A Citizens’ Contract Instead of a Constitution
The contract concluded between each resident and the operating company, called the Citizen’s Contract, is the central document of a Free Private City:
“This agreement explicitly and conclusively regulates mutual rights and obligations and replaces a constitution or a fictitious social contract in a Free Private City.”
Indeed, all the rules to be applied, including private law and public order, are part of this contract:
“In a sense, this is the personal constitutional charter of each individual.”
More specifically, the two contracting parties are:
- On the side of the Free Private City: The operating company or the City that it operates as an entity.
- On the side of the inhabitants: Companies, adults, families (children are included in a parent’s contract, but once they have reached the age of majority, they will decide to sign a contract in turn or to leave the City).
For those who stay only temporarily in the City (visitors and commuters who only work in the City), several possibilities are offered: special contracts, sign at the border, document to be signed at the entrance with possibly a daily contribution and insurance to pay, etc.
The Citizens’ contract covers three areas:
- The legal system,
- Breach of contract.
The central area is the protection of the life, liberty, and property of contractual citizens. In return, citizens undertake to pay a fixed amount.
In the event of conflicts between the operator and the contract citizens, the Citizens’ contract provides that:
- The proceedings can be resolved before a neutral or ad hoc arbitration court.
- The injured party can claim damages against the operating company.
Changes and amendments to the contract
Titus Gebel mentions several possibilities for making adjustments to the Citizens’ contract: practice will show which model or combination is the most effective. Therefore, the operating company can:
- Suggest an amendment to the contract, but only to people who accept the (new) contract.
- Completely exclude the contractual element which would require modification.
- Include a general clause which authorizes the contract to be revised in the event of exceptional situations (war, natural disasters, etc.).
The author then mentions specific cases:
- In newly created Free Private Cities, a one-time contract modification could be agreed after a start-up period of 3 or 5 years.
- If unforeseen circumstances at the time of the conclusion of the contract occur and truly require an adjustment of the contract, the citizens could benefit from compensation for this legal uncertainty (reductions in their contributions for example or other advantages).
- Certain exceptional contract modifications may be subject to the approval of qualified majorities or to the right of veto.
Secession and termination
- Secession is only possible if all the inhabitants of a clearly defined sub-area genuinely consent to it.
- The contract can be terminated by the customer at any time, but by the provider only for a valid reason (without it affecting his property).
Like the Estonian model, Free Private Cities could grant a simple “electronic” citizen status to non-residents. Thus, although they are not physically present, these e-citizens could:
- Create companies in the Free Private City.
- Open business accounts there.
- Participate in the City’s dispute resolution system.
Chapter 16 – Common Property and Codetermination
The main point to remember from this chapter is the following: in a Free Private City, there are no “public goods.” Indeed, all the facilities and services are:
- Either built or operated by private companies: they are then the owners.
- Or owned by the operating company: The installations in particular (roads, squares, police vehicles, etc.) belong to it.
Chapter 17 – Internal and External Security
The security forces and the emergency forces are under the control of the operator so that he can guarantee the application of his contractual obligations. It is useful (to avoid monopoly) but complicated in practice to authorize competing security service providers. In Free Private Cities, security can then be organized according to the following principles:
- A private police acts as mediator for small disputes; it must have a spirit of service.
- Firefighting and emergency rescue services are included in the compulsory fixed price and the basic contract fee; they are therefore supplied by the operator.
- With regard to the application of the rules, the principle of zero tolerance is a requirement.
- Expulsion remains the main sanction: on the one hand, it relieves the population of criminals, on the other hand, there is a strong incentive for contract citizens to respect the rules if they want to continue living in the Free Private City.
- Border surveillance and control will be strong, with specific measures in countries where the crime rate is high or to avoid blackmail or takeover of the City by the host state.
Chapter 18 – Immigration and Selection
To guarantee order, security and prosperity at a high level, the operator must be the only one to control immigration in the City. The provisions on this matter will be clearly mentioned in the Citizens’ contract.
It is therefore the operator who chooses his immigration criteria. These revolve broadly around:
- Social harmony.
The operator can therefore carry out checks along these lines.
Chapter 19 – Infrastructure and Services
Titus Gebel describes the different possibilities of the operator to guarantee the infrastructure and services in the City:
- Attract specialized service providers (through financial advantages if necessary).
- Establish his own subsidiaries, which can then be sold to service providers or interested contract citizens.
- Negotiate with public and private providers in the host country the sharing of their infrastructure and services in exchange for payment.
In practice, the three methods are likely to be combined.
The author then explains that the development of infrastructure and services can be designed in several stages depending on the number of inhabitants:
- First stage (1,000 inhabitants): Residential and commercial buildings, initial road network, police, fire and emergency services, courts or arbitration bodies, administrative building, electricity, water, Internet and cell phone coverage, groceries, and access to medical services.
- Second stage (10,000 inhabitants): Postal and parcel services, a wastewater treatment plant, a landfill, banks, schools, kindergartens, a hospital, restaurants, craftsmen and other service providers, shopping centers, retail stores, pharmacies, cultural and leisure facilities.
- Third stage (100,000 inhabitants): Construction of airports, seaports, parks, a public transport system, industrial zones, and others.
- Fourth stage (1 million inhabitants): Other districts and sub-centers, universities, large airports, etc.
Chapter 20 – Economic Activity
The installation of industrial and commercial companies in Free Private Cities is crucial, in particular because it generates jobs which allow the inhabitants to earn a living. It is favored by the lack of regulation and therefore reduced maintenance costs combined with legal certainty and investment protection.
Chapter 21 – Social Security
The alternatives to the current social systems which would make it possible to keep, in the City, people who have spent most of their lives there but who can no longer take care of themselves because of their age or an accident, are described in this chapter by Titus Gebel.
Collective mutual aid institutions
They pay benefits, in cases of extreme emergency, to those who regularly contribute to this common fund or who help others in kind.
This is a commercial insurance offered either by the operator of the City, or by service providers. It prevails for pension insurance and health insurance.
Family and friends
The oldest form of helping the weak is the support of family and friends. It is essential because it is a source of compassion and voluntary and genuine solidarity.
When family or friends cannot help for financial reasons, and when no insurance or support institution can intervene, then, and only then, a charitable donation is possible. It will come from a social fund financed by voluntary donations. According to the author, this only concerns 5% of the population in developed countries.
Minimum social security
This minimum social protection (food, shelter, care) is stipulated in the contract and therefore included in the basic fee. It is provided by the City operator on condition of providing proof of the inefficiency or non-existence of the systems mentioned above.
For Titus Gebel, this model will improve social conditions and bring social stability, much better than the one proposed by current welfare states:
“This includes taking responsibility for oneself and for others, genuine compassion, strengthening family and small communities, imagination and ingenuity to overcome difficulties, voluntary solidarity and, in return, gratitude and, last but not least, pride and satisfaction in mastering life on one’s own.”
Once again, this system is based on the principle of reciprocity, voluntary service, and the Golden Rule.
Chapter 22 – Education
22.1 – Flaws in the Current School System
The author highlights here the flaws in the educational systems of democracies:
- Lack of incentives to make a profit (in the public system).
- In schools, both public and private, teachers and students have to follow compulsory curricula and other directives stemming from the political ideas of those in power, without the possibility of escaping them.
- The inclusion of severely disabled people in normal classes is detrimental as it “reduces the level of education” by slowing down the learning of others.
- Opening up access to higher education to as many students as possible reduces the requirements and therefore devalues degrees.
22.2 – The Functioning of the Education System in Free Private Cities
Here are the author’s main proposals in terms of education in Free Private Cities. In general, much more freedom must be given to educational concepts. Which means, in particular:
- Allowing all types of courses and concepts, not limited to program requirements.
- Giving students the freedom to choose any system and school, including home schooling.
- Leaving the management of schools and universities to private providers, which have a profit motive and therefore aim for the quality and satisfaction of students.
- Not making education compulsory : Passing one or more exams at a certain age could, on the other hand, be required; basic skills (reading, writing, arithmetic, etc.) could be assessed.
- Education should not be free. Free education is, for the author, an “absurd” idea. He specifies in this regard:
“Behind the ‘right to education’ there hides the desire […] to live at the expense of others. It is important that contractors understand that education is a service like any other and that it should be paid for accordingly, either by the users of the respective institutions, or by all contracting citizens equally, or by private donors and organizations.”
Finally, the basic principles of Free Private Cities must be taught to all young and new citizens, namely the Golden Rule, the principle of self-determination, reciprocity and voluntariness.
Chapter 23 – Environmental Protection and Externalities
To be attractive, a Free Private City must necessarily be interested in a clean environment. Otherwise, it will have difficulty attracting productive residents. The main idea about the environment is that “hazard principle trumps precautionary principle.”
This idea applies in favor of innovation. Thus, there is no need to put in place thousands of laws and directives. And in Free Private Cities, no theoretically conceivable damage justifies the ban on new projects and technologies. The author thinks, in fact, that:
“Risk aversion is gradually transforming dynamic communities into prohibitive societies.”
Chapter 24 – Budgetary and Currency Issues
To attract citizens, the stake of the operator of the City is to:
“Find various sources of income in such a way that the level of contributions is affordable while allowing a sufficiently high level of performance and an attractive infrastructure.”
24.1 – Earnings of Free Private Cities
Titus Gebel lists here the different possible sources of income of Free Private Cities: contributions placed in a contractual relationship, reciprocal and subject to judicial control.
The operator receives an annual contribution (the same for all residents) which covers the costs of the services offered under the mandatory package of the Citizens’ contract. There may be very rare exceptions which allow the deferral of payment of this contribution or a symbolic contribution (first time settlers then newcomers looking for a job, underage children, retirees). The operator has the possibility to terminate the contract of those who do not pay.
Other sources of income
- Excise duties.
- Property duties (over real estate).
- In successful Free Cities: a sort of one-off payment for new citizens in exchange for a share of the investments already made.
- Specific tariffs such as payment for the protection of a major private event by the police and firefighters.
- Real estate transactions (sale or rental).
- Shareholders: the operator can invest in companies that provide services to residents and thus generate profits.
Weighting of revenues
A priori, the income of a Free Private City should come from:
- 60-70% of real estate transactions.
- 20-30% of services (warehousing, port management, waste disposal).
- 10-20% of administration and license fees.
24.2 – Expenses of Free Private Cities
Sharing of costs
The author anticipates:
- A significant part of spending on education, health, pensions, social spending and debt service.
- 10% of total spending on infrastructure.
- 5% of the total budget for internal security.
Then, Titus Gebel declares:
“This means that a Free Private City can be operated with only 15% of the normal state budget.”
Cost of the annual fee in a Free Private City
Based on these values, Titus Gebel explains that a Free Private City should get by asking its residents for an annual contribution of $500 to $1,200 per inhabitant. Thus, for a City of 100,000 inhabitants, the author asserts that an annual contribution of only $350 per person would be “in theory sufficient to guarantee a level typical of a highly developed country.”
At the same time, each citizen has the right to build their own portfolio and their own level of protection according to their budget and personal preferences. He will also have to deal with the expenses of charges not included in the compulsory package (ideally privatized) such as water, wastewater, electricity, garbage collection, schools, education, training, insurance, sickness, retirement provision, and other insurances.
In short, life in Free Private Cities should, according to Titus Gebel, be cheaper for almost the entire working population, without loss of benefits. People would then be able to make sure to have income during old age, improve their standard of living and achieve various other goals.
24.3 – Currency and Central Bank
A stable currency:
- Facilitates transactions and savings.
- Builds trust.
- Enables long-term planning (retirement).
Free Private Cities have no reason to create a central bank or to require a specific currency for the payment transactions of the citizens of the City:
“The host state currency, a cryptocurrency like bitcoin or a regional or common reserve currency will likely end up dominating the markets or multiple currencies will coexist.”
Part 4 – The Future
Chapter 25 – Evolution Instead of Revolution
25.1 – The Market of Living Together Already Exists
Titus Gebel mentions several examples which show that the market for coexistence is already being created. This is case for:
- The special zones called ZEDE, in Honduras, and in particular the Prospera project, which is starting to emerge, and which is led by Titus Gebel and his team (Honduras has also changed its constitution to allow this kind of projects)
- The Floating cities at sea, like in French Polynesia.
- The Free City of Mu Aye Pu in Myanmar in the autonomous Karen state.
- The classic new liberal state Liberland about to emerge on a patch of unclaimed territory between Serbia and Croatia.
- The Neom project in Saudi Arabia.
- The Bitnation, a virtual state with its own legal and dispute settlement system.
“Free Private Cities have the potential to become a real alternative to existing orders or to overcome them in the direction of ‘creative destruction’ (Schumpeter) without overthrowing them. Evolutionary changes are always preferable to violent revolutions. Every revolution ultimately eats its children and every revolution so far has simply replaced one privileged group with another.”
When various Free Private Cities are spread around the world, it will exert a positive competitive pressure on the existing states which will have to add more freedom to their systems if they do not want to lose their most productive citizens.
25.2 – Diversity Instead of Uniformity
Communities can be many and varied provided that participation in them is voluntary.
In Free Private Cities, individuals are free to be whoever they want. It is, in this sense, a step towards personal well-being and balance:
“The Free Private City is an operating system that enables the individual to realize his idea of happiness or, less dramatically speaking, to live his life the way he wants to.”
Private autonomy is a guiding principle, and no longer an “allegedly objective” common good. Sovereign of ourselves, we can determine our own life in the City. It is no longer a question of leading the collective. Man is “the product of his own decisions, and not the victim of any circumstance.”
Chapter 26 – “The Choice is Yours”
In this second to last chapter of “Free Private Cities”, Titus Gebel paints a picture of three possible scenarios according to him.
26.1 – More Politics: “Nannytopia”
In this scenario, the world has a unified government. The same rules apply to everyone. It is a democratic and fair world, with the motto: “Everything for democracy, everything through democracy, nothing against democracy.”
26.2 – More Religion: “The Universal Caliphate”
In this second hypothesis, Titus Gebel describes a society in which Muslims are in the majority in all countries of the world “through decades of birth jihad.” The global opening of borders, combined with the anchoring of the human right to immigration in the UN Charter, has largely contributed to this situation.
26.3 – More Self-Determination: Decentralization
In this world there are over 2,000 different systems. All are voluntary systems, managed by private companies, but there are also cooperative models, direct and indirect democracies, and many hybrid forms.
The author concludes by asserting that neither “more politics” nor “more religion” are appropriate solutions for a harmonious coexistence and that the systems proposed in the first two worlds, the Nannytopia and the Universal Caliphate, “would set our development back by decades.”
Chapter 27 – The Development of Free Private Cities
In this last chapter, Titus Gebel makes many hypotheses about the form that Free Private Cities will take in the future and their proliferation. He mentions in particular:
- Potential alliances with other small and large states (like Singapore and Israel who work together on security issues).
- The possibility that Free Cities will be managed by the territorial states.
- The fact that Free Private Cities will promote innovation and technological progress:
“Just as man strove to reach the most distant corners of the earth, the poles, the highest peak in the Himalayas, the deepest underwater trench, he will continue to strive to expand. He has been to the moon. The next step may be the colonization of the seas or the leap to our neighboring planets. Free Private Cities are a suitable operating system for this as well.”
Conclusion of “Free Private Cities” by Titus Gebel
The Author’s Conclusion
In conclusion (the book’s appendix), the author answers a question that the reader, at the end of the book, is highly likely to ask: Is a Free Private City for me? To which the author answers that it depends…
In fact, for the author, Free Private Cities are for people who identify with the principles of freedom; voluntariness, self-determination, and self-responsibility, and who do not believe in the common good. Those who prefer state risk protection, global fairness , and who believe in big ideas to save mankind probably could not adapt to the concept of Free Private Cities. Finally, the author sums it up as follows:
“Ultimately, it makes no difference whether you call yourself a believer, an atheist, a socialist, a conservative, a liberal or a libertarian. Basically, humanity is divided into only two groups: those who want to impose their will on others and those who do not.”
The Concept of Free Private Cities | Summary in a Few Lines
Let us summarize in a few words the concept of Free Private City described by Titus Gebel in this book. In Free Private Cities, the relationship between the authority and the subject is replaced by the relationship between the client and the service provider.
A Free Private City is:
- An autonomous or semi-autonomous city, free from all politics, in which a private company as a “public service provider” offers the protection of life, liberty, and property. This service includes internal and external security, a legal framework, and independent dispute settlement.
- For these services, the inhabitants enter a contract, called the Citizens’ Contract, with the operator of the City; a more or less ordinary private company. They pay a fixed annual amount. The public service provider cannot unilaterally modify this Citizens’ Contract thereafter. As a “contract citizen”, the inhabitant has a legal right to his respect and to damages in the event of poor performance.
- Offers great economic and personal freedom, private property, equality for all and a welcoming climate for employment and entrepreneurial initiatives ; in the City, each person is sovereign of himself and can do what he wants on condition of respecting the rights of others and the other moderate rules of coexistence.
- A form of think tank where new economic and social models can be tested in a small area, without taking too great a risk.
In fact, we already use the service approach in many areas of our daily life (insurance, baker, tax advisor, etc.). Finally, Free Private Cities aim to globalize this conception to the market of coexistence.
A Revolutionary Book Offering an Alternative to Conventional Systems
“Free Private Cities” is a book that can only cause controversy. Innovative, revolutionary, and libertarian, the concept of Free Cities presented by Titus Gebel is a complete break with mainstream thinking. The remarks of the author:
- Put forward radical ideas and a very critical point of view about the democratic models and social systems proposed by the governments of welfare states.
- Give a pacifist alternative and serious thought to these conventional systems which seem to have reached their limits: more freedom, more citizen empowerment; less politics, less common good, and competition as a solution to social progress.
In these ways, it is a very daring and interesting work. It:
- Forces us to question ourselves, to see things from another angle.
- Challenges dogmas and calls into question the great universal principles that are sometimes “off limits” (electoral system, basis of certain human rights).
- Raises taboo issues head-on. It addresses questions without the usual answers or self-righteousness.
What Readers May Not Like
The book is long, dense, and not always easy to read. The subject is undoubtedly the reason for this: Such a vast and complex proposition cannot be reduced to a simple presentation or a brief argument.
In addition, readers may be upset by:
- Some extreme and reductive remarks by the author who indulges in generalities without mentioning his sources (on Muslim immigrants in particular to whom he attributes a large part of the ills of Western society, or the inclusion of disabled children in school which would slow the learning process of other students).
- Very caricatured passages such as the description of the three societies of the future (in the second to last chapter) or the answer to the question in the appendix “Is a Free Private City for you?”
To understand the message and concept of Free Private Cities, it is necessary to be able to go beyond the author’s positions on these subjects. The process is not always easy, but it is worth it.
Finally, the concept may seem utopian and still too fallible for some. However, ultimately, this is the case with the any initial innovative proposal that improves and is optimized over time and with experience.
Why I Recommend the Book “Free Private Cities”?
Whether you believe in it or not and whether you agree with it or not; “Free Private Cities” is truly worth the read, for various reasons:
- First, because it opens the mind, projects us into a future other than what we are usually given to think about, generates unexplored ideas, ventures off the beaten path and creates a serious and new debate.
- Also, because the book is a powerhouse of ideas : It presents a real life option for people who have the feeling of being controlled by traditional political systems and who dream of living freely in a city where the tax payer would become a client subject to the laws of a new market and no longer to the interests of a few people in power.
- “Free Private Cities” offers a real alternative to conventional political and social systems.
- A revolutionary and unique concept that broadens our way of thinking.
- The author’s language is forthright and far from being politically correct.
- Principles that are about to be implemented concretely in the Prospera project in Honduras, as well as in other parts of the world: It is not just theory.
- Some unjustified leaps that do not rely on any source, some rather caricatured passages at times.
- A read that is long and not always flowing.
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