Peter Thiel

Homesteading on the High Seas

Floating Burning Man, "jurisdictional arbitrage," and other adventures in anarchism


If Peter Thiel funds something, it's bound to be cutting-edge awesome.

He is a supporter of the Methuselah Mouse Prize, which seeks to slow, stop, and eventually reverse aging. He was a producer of the film Thank You for Smoking, based on Christopher Buckley's charmingly ambiguous novel about a pro-tobacco lobbyist. An early investor in social networking, he was involved with Linked In and was the first investor in Facebook. He's big at the Singularity Institute (reason's Ronald Bailey caught up with him at the Singularity Summit earlier this year, check out the interview in the May print edition), which ponders and pushes artificial intelligence in preparation for a Vernor Vingeian "intelligence explosion." His first success was PayPal, which he originally hoped "would grow to become an extra-governmental system of currency, something reminiscent of the world described in Neal Stephenson's novel Cryptonomicon, in which programmers use encryption to create an offshore data haven free from government control."

And last week, Thiel announced a $500,000 investment—the same amount he put into Facebook in June 2004—in the Seasteading Institute. Seasteading, or "homesteading on the high seas," is an idea that has long attracted libertarians and others who would like to see a little more competition between forms of government. The idea is to get out into international waters and set up a floating outpost (or 12, or 1,200) from which people can come and go, experimenting with different types of legal, social, and contractual arrangements.

Thiel's co-conspirator and resident big thinker is none other than the impeccably credentialed Patri Friedman, son of David "Machinery of Freedom" Friedman, grandson of Milton "Capitalism and Freedom" Friedman. Patri, 31, has been beating the drums for various floating autonomous entities for several years, whenever he can steal time from his work as a software engineer at Google and from his now 2-year-old son, Tovar.

Despite the seemingly radical idea he's championing, Patri sees himself as a practical guy: "Starting a new country is actually a much less hard problem than, say, a libertarian winning a U.S. election," he says. He says that most of his competitors in the libertarian/anarchist autonomous entity business have been too ambitious, citing efforts from Sealand (the abandoned offshore fort-turned-free-state "which sort of worked" until it was devastated by fire in 2006) to more dramatic failures like Freedom Ship (current estimated cost >$11 billion, construction not yet begun) and the Aquarius phase of the Millennial Project ("colonizing the galaxy in eight easy steps!") to Minerva Reef (an uninhabited dredged island "invaded" by neighboring Tonga and eventually more or less reclaimed by the sea).

Learning a valuable lesson from his predecessors, Friedman is an incrementalist. "I want to talk about what to do this year, not how to colonize the galaxy." One way to start small, he says, is to hold a kind of floating Burning Man, called Ephemerisle, an idea inspired by childhood pilgrimages with his father to Pennsic, a Society for Creative Anachronism medieval reenactment held outside Pittsburgh, and college stints at Burning Man.

"There aren't that many people who are wiling to drop their lives and move to the ocean." Instead, he says, "it could start as a one week vacation, but then unlike Burning Man it could grow and eventually become permanent." Friedman hopes to hold the first Ephemerisle next summer, inviting many types of floating vessels to join him in international waters. Even an ordinary cruise ship might be enough to get started, since the cruise industry has proven that "providing power, water, food, and internet on the ocean is not only possible but can be profitable." But some of Thiel's grant is going toward figuring out the best way to throw up some small, cheap seasteads to provide a little non-state infrastructure and get things rolling (or floating, as the case may be).

From the official website: "Think about all the hot air and argumentation about a whole host of different political issues—freedom vs. security, absolute wealth vs. inequality, strong family vs. tolerance, open vs. closed borders, whatever the topic du jour is. Instead of deciding them through rhetoric, or voting on a few representatives to decide them for tens or hundreds of millions of people at once, imagine if we could try them each on a small scale and see what happens."

Thiel and Friedman met at a dinner set up by a couple of guys who work for Thiel's investment firm, Clarium Capital, and happened to be fans of Friedman's blog. Ajay Royan, a principal at Clarion and now a board member at the Seasteading Institute, described how the meeting of minds between Friedman and Thiel came about a few months back: "Peter knows Patri's grandfather, so we were just tickled that somebody of that lineage was so close to us physically and was thinking about macro issues from that perspective," says Royan. "We'd been having a lot internal debate [at Clarium] about how we get a freer space for people to function in. What was intriguing to us was that here was somebody proposing to shift the canvas to a relatively neutral space by recreating a frontier."

Not content with revolutionizing technology and society, Thiel says he's looking to bring "innovation to the public sector, where it's vitally needed." As with PayPal, his aspirations for the project are far from modest: "We're at a fascinating juncture: the nature of government is about to change at a very fundamental level."

Having a low-cost, gradually ramping up cluster of choices to live on would lower the cost of "jurisdictional arbitrage," which is very high right now, says Friedman. If you don't like your government right now, the only way to get a new one is to sell your house, pack up, move to another country, deal with immigration, get a new job and a new house, make new friends, and learn a new culture. This is expensive. But hopping from boat to boat, platform to platform, or island to island is cheap.

In fact, Friedman sees seasteading as a real, viable version of a metaphor his dad once used to sell anarcho-capitalism, and demonstrate why Nozickian utopias with lots of free entry and exit will tend toward libertarianism rather than authoritarianism:

Consider our world as it would be if the cost of moving from one country to another were zero. Everyone lives in a housetrailer and speaks the same language. One day, the president of France announces that because of troubles with neighboring countries, new military taxes are being levied and conscription will begin shortly. The next morning the president of France finds himself ruling a peaceful but empty landscape, the population having been reduced to himself, three generals, and twenty-seven war correspondents.

The question is (to paraphrase Justice Oliver Wendell Holmes): Will three generations of Friedmans be enough? Patri Friedman is optimistic. "I hope I can create a world where [my son] doesn't need to worry about how to increase freedom because we've already got it." he says. "But I suspect that I'll still be working on it by the time he's old enough to help."

Katherine Mangu-Ward is a reason associate editor

NEXT: There Oughtta Be...a New Congressman

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  1. “Jurisdictional Arbitrage” — The sort of phrase that causes lawyers to uncontrollably come in their pants.

  2. Brace yourselves for the barrage of mindless invectives: crackpot, idiots, tin-foil-heads, etc., etc.

  3. It sounds like a great idea, seeing as anyone with a boat could hook up to whichever jurisdiction they wanted, giving them that almost zero cost of movement.

    However, I guarantee–guarantee–that as soon as stuff like this was set up and people were going for drug holidays and cocaine was being moved through them and weapons were sold willy-nilly and gambling and prostitution and all of it, the big countries would just get together and come up with an Oppression Pact, change the maritime laws, and shut it all down.

    However, one could probably make a lot of money before then.

  4. However, one could probably make a lot of money before then.

    Hence the lawyers’ excitement.

  5. The whole idea plus Episiarch’s comment brings to mind a semi-rhetorical question:

    why are day cruises for gambling so common, but not day cruises for getting high or prostitution?

    There’s a market waiting to be tapped, right there.

    Ships could register with the Netherlands.

  6. So, when can we start shipping them out?

    What about those religious fundamentalists that want their own in-country state as well? Can they split the land?

    Any chance to watch a Libertarian state rise and fall under its own naive hubris would give me the same satisfaction as watching Communism take a tumble.

  7. On starting small: With the mess of our healthcare system, why not a floating hospital? Doctors and all other hospital staff would be free from the onerous regulations imposed upon the industry in this country. Experimental treatments and drugs would be readily available and outside the scrutiny and control of the FDA. The market would be the sole judge of the venture’s success.

  8. Noel: the irish are way ahead of you, for years there was an abortion ship that sailed off the coast to avoid Irelands criminal prosecution.

  9. Having a low-cost, gradually ramping up cluster of choices to live on would lower the cost of “jurisdictional arbitrage,” which is very high right now, says Friedman. If you don’t like your government right now, the only way to get a new one is to sell your house, pack up, move to another country, deal with immigration, get a new job and a new house, make new friends, and learn a new culture. This is expensive. But hopping from boat to boat, platform to platform, or island to island is cheap.

    There are two key mistakes in this reasoning:
    1) The high ‘jursidictional arbitage’ costs cited, except for ‘deal with immigration’ and possibly ‘learning a new culture’ would still be present when moving from platform to platform.
    2) Human nature being what it is, it is inevitable that ‘the good spots’ will create some sort of influx control, i.e. ‘immigration’, especially when resource limitations are much more real and apparent.

    For all the talk of the decline and fall of american civilization due to Dubya (or FDR if you prefer), it still has a very low ‘jurisdictional arbitage’ to travel to relocate and make a new life in any of the 50 states or various territories – for a very real difference in economics, law, social mores, and even culture.

  10. And to use another internet board cliche:

    Simpson’s did it.

  11. I don’t suppose anyone else here plays video games. So who is Andrew Ryan and when can I take a trip to Rapture before it blows up on itself with runaway gene splicing 😉

  12. I would be willing to pay $200 per month for a slip that will hold my 30 foot sail boat. If they can provide A/C power to charge my batteries and fresh water, and a general store for diesel, food and hardware I’d seriously consider it.

    Ya’all would be welcome to visit. We can watch “Waterworld”, and open a bottle of pinot noir.

  13. yeah, Bioshock kicked ass. Very creepy game.

  14. This actually sounds like a great idea! Of course, since they’re in the open seas, “slips” aren’t really going to be feasible unless they can manage to build their own gigantic atoll, but that’s just an implementation detail.

    My choice for president of the new country: Mary Ruwart. If she’s not available, I believe Ron Paul is looking for a gig. If they aren’t available, maybe this guy. He’s got the hat and everything.

  15. Hey Lone,

    That might be the best comment you’ve ever made here. There’s hope for you yet.

  16. I started reading this article hoping for lulz at the expense of some crackpot.

    But then I saw the crackpot was Patri, who is kind of awesome.

    So now I’m all excited, in a Waterworld-y sort of way.

  17. I’d live there, but considering half the residents would be lawyers and the other half would computer programmers, it’s hard to see it being economically viable without becoming pretty dependent on statist land-based nations.

  18. Excellent Idea

    Either Germany will repeat in USA or the j**s has to go and live on high seas.

    Fiat currency is slavery, stealing the wealth of real producers of wealth by inflating currency. Then one fine day people wake up and start chasing out the j**s.

    When will this kleptomaniac tribe learn? Shhh don’t tell anyone Facebook was started with stolen idea…..

  19. Was April Fool’s extended to the end of the month, or is this article for real?

    If Patri Friedman’s last name was anything other than Friedman, he’d be (rightfully) written off as a side-show clown.

    Come on, libertarians. Keep it together.

  20. The U.S. Navy would never allow this, America patrols most oceans and the areas America doesn’t patrol foreign governments do. As the people building Minerva found out when a Tongan gunboat showed up.

  21. If you start in the middle of a toilet bowel, won’t you eventually get to the ocean?

  22. The U.S. Navy would never allow this, America patrols most oceans and the areas America doesn’t patrol foreign governments do. As the people building Minerva found out when a Tongan gunboat showed up.

    I disagree. The US navy would allow it, but would ‘recognize your territorial sovereignty’ and stay outside the 12 mile limit and watch as pirates overrun your position.

    Of course, if you then become the home port for pirates, the Navy will then take you out under international law (if that’s not your cup of tea then just call it ‘300 hundred year old widely accepted and recognized nautical tradition’)

  23. Sounds cool, if idealistic. At least if/when the current geo-political order collapses and chaos ensues, some people will have a plan for where to go, and how to keep the dream alive.

    I’ve always wondered why someone like Bill Gates doesn’t do this himself with all that money. I would. And i’d make sure to be very public with it, so everyone knew why. So then if The Authority tried to take me out, i’d make myself a huge (to the point of annoyance) martyr for freedom.

  24. Geez, am I the only person who thought of L. Bob Rife?

  25. The house just passed the new Coast Guard Authorization bill, not passed by the Senate. I don’t know how to read it, so I don’t know if this amendment remained, but Congressman Dan Lungren from California added

    Would make it a federal criminal offense to knowingly or intentionally operate or embark in any submersible or semisubmersible vessel that is without nationality and that is navigating or has navigated into, through, or from waters beyond the outer limit of the territorial sea of a single country or the lateral limit of a country’s territorial sea with an adjacent country. An offense would be punishable by a fine, imprisonment for not more than 20 years, or both”

    Does that prohibit this kind of thing? I am having a hard time reading it.

  26. The SS United States is often for sale for a few million bucks. Still holds an Atlantic crossing speed record too…

  27. why are day cruises for gambling so common, but not day cruises for getting high or prostitution?

    Well, the Drug Boat would have to keep an inventory, so anytime it docked there would be trouble.

    The Love Boat? Not sure. Of course, I wouldn’t be at all surprised to learn that there are call girl franchises on cruise ships, just kept very sub rosa.

  28. When I make my first 250 million I will try this idea.

  29. How has noone brought up this point:

    We are *supposed* to be 50 free and independent states, United by a limited federal government with limited authority to handle specifically authorized tasks (like interstate commerce and security).

    Our nation was literally created to be 50 “ships” in an ocean of freedom, where states would conceivably compete based on the quality and desireability of their unique laws.

    What happened to that concept? Why is that concept now only viable in the middle of the ocean? And when I live out on some dingy in the middle of the Atlantic, who will my employer be?

  30. And re: The House’s comments regarding sub and semisubmersibles:

    I think that is worded to give legal authority to stop & detain submarines and semisubmersibles that are more and more frequently being used to route illegal drugs into our country.

  31. umm, isn’t this old nooz guys?

  32. I would encourage y’all to read the materials on our website, like the FAQ or the book I’ve written. Many of your comments are answered there. Frankly anyone who thinks pirates are a serious problem has no idea what they are talking about. Most pirates are lightly armed, and the organized groups target cargo ships which have lots of movable cargo and few crew. A floating libertarian city will have lots of well-armed people and little movable cargo. It’s totally different.

    The US Navy is much more of a concern. I expect we will have to have some significant restrictions (no exporting drugs, no money laundering) in order to not piss them off. As long as we get autonomy over internal affairs, I think there is still lots of freedom to be gained by this route.

    The bill that was cited specifically refers to unflagged vessels (“without nationality”). Seasteads will be flagged, so it does not apply to them.

  33. Seriously, Mr. Friedman … you just wanted an excuse to establish a “Captain’s Blog”, didn’t you? 😉

    It’s a fantastic idea, BTW, in every meaning of the word

  34. I will start my own floating island nation, which I shall rule over as King Henry I.

    Seriously, though, this is an interesting idea. Oddly enough, I heard about someone doing something similar (creating floating islands, though without the libertarian emphasis) on national socialist radio.

  35. Patri Friedman,
    I’m pretty sure the governments bent on maintaining their local monopolies on power will try to declare the seasteads “unflagged”. Any libertarian revolution ultimately needs weapons, since the enemies of freedom will follow us wherever we go. I’m actually somewhat concerned that being out in the middle of the ocean would make us more susceptible to, for example, a bombing campaign by the established powers. I would also like to add that if the seastead idea doesn’t work out, my Antarctic colonization initiative is a possibility. As to the international treaty concerning territorial claims, screw it. They have no rightful authority there, and its a whole continent ready for the taking.

  36. See “Bioshock” storyline

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