I find many valuable insights in James Buchanan’s essay The Soul of Classical Liberalism, but I was particularly struck by a point that Buchanan only touches upon tangentially:
Much has been made of the American spirit or soul as influenced by the availability of the territorial frontier during the first century of the United States’ historical experience. Why was the frontier important? The proper economic interpretation of frontier lies in its guarantee of an exit option, the presence of which dramatically limits the potential for interpersonal exploitation. There has been a general failure to recognize that the effectively operating market order acts in precisely the same way as the frontier; it offers each participant exit options in each relationship.
The rational evangelists of libertarianism think we need to argue better, but it’s really exit that makes liberty possible, and exit is not an argument. Libertarians need better exits, not better arguments. They need to see markets as the solution rather than the goal.