Free Private Cities – there is an alternative

Management18 Jan 2021

Sponsored by Tipolis Corp.

Dr. Titus Gebel, Founder & CEO - Tipolis Corp.

According to polls in Western countries, 80 per cent of citizens are dissatisfied with how they are governed, no matter who is in charge. More and more people feel that besides casting their vote every few years, they don’t have a say in what is going on and what their tax money is spent on. Tax burden is growing, while at the same time services are perceived as insufficient – be it security, education or infrastructure. Citizens in allegedly free societies are afraid to speak out on controversial issues, the number of which is growing daily. A wrong sentence can ruin your career. As if that wasn’t enough, laws and thereby the social contract are changed constantly, albeit never from the side of the citizens. Unforeseeable changes in regulation make it difficult for business and individuals alike to plan for the long term. What is allowed today may be forbidden tomorrow. No wonder that for many, this is not really satisfying.

Can we create a different relationship between individuals and groups with the state that is safer, freer, functions better, delivers the best services and brings prosperity?

The answer is yes. Actually, government is a service like any other service. You expect something from it, especially the protection of life, liberty and property, and you are willing to pay in exchange. You are normally not pleased if services are not performed well or if the service provider gets involved in other activities that you have not mandated and then expects you to pay for it. It is even worse: in most countries the relationship of the citizen to the government resembles somebody who wants to buy a car. However, the car dealer insists that he will choose the model, the colour, the size of the motor and the price you have to pay. And you must buy. Not really an attractive deal, is it? But this exactly describes your relationships towards the “government service provider”, or the state you live in.

In contrast, imagine a system in which a private company as the government service provider offers you protection of life, liberty and property. This service is clearly defined and includes security, a legal and regulatory framework, and independent dispute resolution. You pay a contractually fixed amount per year for these services, so there is a real social contract, not a fictional one. Besides that, you take care of everything else by yourself, but you can also do as you please, limited only by the rights of others and the contractually agreed rules of coexistence.

The government service provider as the operator of the community cannot unilaterally change this “Civic Contract” with you at a later date. Disputes between you as “Contract Citizen” and the government service provider will be heard before independent arbitration tribunals, as is customary in international commercial law. Further development of the agreed regulations is carried out by judicial case law, as has worked well in common-law jurisdictions for centuries. If the operator ignores the arbitral awards or abuses his power in any other way, his customers leave and he goes bankrupt. He has his own economic risk and therefore an incentive to treat his customers well and in accordance with the contract. This model is called a Free Private City.

In today’s world, the establishment of a Free Private City requires a contractual agreement with an existing state as the host nation. But why should states agree to this? As with all barter transactions, there is only one reason: one’s own interests. States can agree to surrender some of their powers for a given territory if they expect benefits from it. The establishment of Free Private Cities in structurally weak areas not only increases the attractiveness of the surrounding region, but also creates jobs and investments there, which ultimately benefits the host nation.

Most people want to make their own choices; they neither want an enlightened elite nor journalists or celebrities to tell them how to live their life. Most people prefer privacy over mass surveillance. Most people do not want to pay for things they have not ordered. Most people do not want to be subjugated under regulations and agreements they have not given consent to. Most people want to have the right to be left alone if they do no harm to others. Free Private Cities respect these wishes.

That is why they will exist. Because eventually, people will go where they are treated best.

Titus Gebel is a German entrepreneur with a PhD in international law and an extensive worldwide network. He founded Frankfurt-listed mining company Deutsche Rohstoff AG, among others. In 2015, he retired as CEO to focus on Free Private Cities with the aim of creating an entirely new product in the “market of living together”. Titus has written a book, Free Private Cities – Making Governments Compete For You, where he states the theoretical and practical groundwork. He is founder and CEO of TIPOLIS CORP., which is currently working on implementing the first Free Private City worldwide.