As someone who’s spent some time diving into the works of Murray Rothbard, I admire his passion for individual liberty and his unwavering critique of state power. Rothbard’s vision of a free-market society, where voluntary exchanges and private property reign supreme, is compelling in many ways. But the more I think about it, the more I realize there’s a blind spot in his philosophy—one that’s hard to ignore when looking at the modern world.
Rothbard believed that monopolies and exploitation were the result of government intervention. To him, the state was the primary aggressor against freedom, while markets, if left untouched, would naturally correct themselves. But what Rothbard didn’t seem to grasp—or at least didn’t address deeply enough—is what happens when corporations grow so powerful that they can manipulate and control governments, turning them into tools for their own benefit. This dynamic creates a system where corporations and states reinforce each other, making it nearly impossible for individuals or small businesses to challenge their dominance.
The Rise of Corporate Power
Rothbard’s confidence in the free market rested on the assumption that competition would always keep businesses in check. If a company exploited its workers or customers, competitors would swoop in, offering better conditions or lower prices, and drive the bad actor out of the market. In theory, it’s a neat system. But in practice, it doesn’t always work that way—especially when corporations grow so large and wealthy that they can essentially write the rules of the game.
When corporations accumulate vast amounts of wealth, they’re able to influence governments to create regulations, policies, and legal frameworks that protect their interests. This isn’t just a hypothetical concern—it’s something we see everywhere. Think about how tech giants shape laws around data privacy, or how pharmaceutical companies control drug pricing by lobbying against reforms. In these cases, corporations aren’t just operating within the market—they’re actively controlling the systems that are supposed to regulate them.
Rothbard’s framework doesn’t really account for this. He saw governments as the sole source of coercion, but he didn’t seem to consider how corporations could co-opt that coercion for their own gain. Once a corporation becomes more powerful than the government trying to regulate it, the idea of a “free market” goes out the window.
The Myth of Consumer Choice
One of Rothbard’s key arguments was that consumers, through their purchasing decisions, would naturally regulate the market. If a company acted unfairly or provided poor service, consumers could simply take their business elsewhere. But that only works if real alternatives exist—and in many cases, they don’t.
Monopolies as Barriers to Choice
When corporations dominate entire industries, they create monopolies or oligopolies that eliminate meaningful competition. Look at industries like healthcare, energy, or telecommunications. If you’re unhappy with your health insurance provider, can you really “just switch”? If a utility company charges outrageous rates, what’s your alternative? The answer, for most people, is that there isn’t one.
This is where Rothbard’s optimism about markets falters. He assumed that monopolies could only exist if governments propped them up, but the truth is that corporations can build monopolies on their own—and once they do, they can use their power to keep competitors out. They can buy out smaller rivals, control supply chains, or manipulate markets to ensure no one else can challenge them. At that point, consumer choice becomes meaningless, because the “choices” are all controlled by the same few players.
The Limits of Decentralization
Libertarians like Rothbard often point to decentralization as the ultimate solution to both state and corporate power. Decentralized markets, decentralized governance, decentralized everything—it’s an appealing idea, and in some cases, it works. But decentralization isn’t always enough, especially when centralized forces actively work to crush it.
Centralized Efficiency vs. Decentralized Resistance
Centralized systems are often more efficient at addressing large-scale challenges, such as infrastructure development, healthcare, or technology development. Decentralized alternatives may be more resistant to corruption, but they often can’t match the scale or efficiency of centralized systems. And when those centralized systems are controlled by powerful corporations, they can use their size and resources to suppress decentralized competition.
We see this play out in the tech world, where large companies buy out smaller competitors or use their platforms to undercut them. Even in industries where decentralization thrives, like cryptocurrency, we’re seeing increased efforts by governments and corporations to regulate, restrict, or co-opt the space. Rothbard’s faith in decentralization as a counterbalance to power feels overly optimistic in the face of these realities.
The Feedback Loop of Corporate-Government Power
The biggest issue I have with Rothbard’s framework is that it doesn’t address the feedback loop between corporations and governments. Rothbard saw the two as separate entities, with the state being the oppressor and the market being the liberator. But in reality, corporations and governments often work hand in hand, creating a hybrid system where both reinforce each other’s power.
Corporations use their wealth to influence governments, and governments, in turn, use their authority to protect corporate interests. This dynamic erodes the competition and voluntary exchange that Rothbard cherished. It’s no longer about the free market—it’s about a system of mutual reinforcement that concentrates power at the top while leaving everyone else with fewer choices and less freedom.
What Rothbard Missed
So, where does this leave us? Rothbard’s ideas are still valuable in many ways, but they need to be expanded and adapted to address the realities of corporate power. Here’s where I think his framework falls short, and what I believe needs to be added:
- Corporate Power Is as Dangerous as State Power
Rothbard focused almost entirely on limiting the state, but corporations can be just as coercive—especially when they control essential resources or industries. - Some Regulation Is Necessary to Preserve Competition
Rothbard rejected regulation outright, but without rules to prevent monopolies, competition can’t survive. Antitrust laws and similar measures are essential to keeping markets truly free. - Inequality Undermines Freedom
Rothbard assumed a level playing field, but in reality, wealth and power disparities allow corporations to dominate both markets and politics. Addressing these inequalities is key to creating a society where individuals are truly free. - Accountability Is Non-Negotiable
Whether it’s governments or corporations, concentrated power needs to be held accountable. Rothbard didn’t focus enough on how to ensure that those in power—be it public or private—are answerable to the people they affect.
Conclusion
I still respect Rothbard’s vision of a freer, less coercive society. But the more I think about the modern world, the more I realize that his framework doesn’t address the full picture. Corporations aren’t just neutral market participants—they’re powerful entities that can rival or surpass governments in their ability to shape our lives.
If we want to create a society that’s truly free and equitable, we need to confront all forms of concentrated power, not just state power. Rothbard’s ideas are a great starting point, but they’re not enough on their own. It’s time to move beyond his idealism and develop a more nuanced approach—one that recognizes the complexities of power in a corporate-dominated world.
