People are not all the same, and they make different choices because they have different values, circumstances, and levels of understanding. Sometimes those choices are peaceful and wise; sometimes they are not.
So what are the best ways to promote good choices and cooperation while preventing and providing resolution for conflict?
In answering such questions, it is important to recognize that there are unavoidable limitations. The idea of a perfect society where there is no conflict and all outcomes are equal is an absurd utopian fantasy, and so is the idea of a deus ex machina that can magically swoop in to make everything right. Imperfect knowledge and ability, conflicting interests, transaction costs, and other collective action problems will always be barriers to a perfectly peaceful and productive society.
In economic terms, there are markets for law and order just like there are markets for food and clothing. They are composed of scarce goods whose supply is in demand and which must be allocated among competing uses. Economic analysis of governance mechanisms offers tremendous insights, not least of all because it accounts for the crucial impact of incentives and constraints on human behavior.
History and reason show that private governance does an excellent job of protecting property rights and facilitating peaceful exchange. They also show that government interference distorts and obstructs justice.
Principles of Justice
Justice is the preservation and restoration of rights under natural law, and is required for peace and harmony in society. Justice is also the foundation upon which mercy and charity must be built. Victims may choose to grant mercy to violators to appease the demands of justice, but denying justice to victims leads to perpetual conflict and misery.
True justice is based on protection and restitution, not revenge. Two wrongs can’t make a right. Retaliation tends to escalate conflict and waste resources, often at the expense of victims. Restitution compensates victims, eliminates desires for revenge, and provides contrite offenders with a path to redemption.
Violations of natural law are always violations of property rights. This is obvious with typical property crimes like theft, but even your life and liberty are based on self-ownership. This underscores the importance of clear property rights because without them, there is no basis for victimhood or restitution. No property, no victim. No victim, no violation.
Rights violations in a free society would be treated as torts. Many offenses currently considered “crimes” would still be illegal, but compulsory puritanism would be unlikely. Proponents of victimless crime laws (e.g. laws against drug use or prostitution) are rarely willing to bear the costs of enforcing them.
Vices are those acts by which a man harms himself or his property. Crimes are those acts by which one man harms the person or property of another. Vices are simply the errors which a man makes in his search after his own happiness. Unlike crimes, they imply no malice toward others, and no interference with their persons or property.