By Jesse Robertson
Cleveland Review of Books
“It’s irritating to be reminded of the contingent world.” So says Wilder Penrose, the “amiable Prospero” and antihero of JG Ballard’s Super-Cannes. In the novel, Penrose oversees a capitalist paradise nestled in the French Riviera: the exclusive community of Eden-Olympia, his “ideas laboratory for the new millennium.” Eager to escape state overreach and the thrum of the masses, executives, magnates, and industrialists flee to Penrose’s territory in pursuit of unfettered profits. But Eden-Olympia’s social order is undergirded by sadistic violence. The haves ritually partake in deadly “microdoses of madness,” exacted upon the have-nots.
While Ballard deals in fiction, Raymond Craib, the Marie Underhill Noll Professor of American History at Cornell University, takes up all-too real schemes of elite societal withdrawal in his spectacular Adventure Capitalism: A History of Libertarian Exit from the Era of Decolonization to the Digital Age. Surveying the storied past of “exit projects”—attempts to fashion free-market states, private cities, and exclusive utopias—Craib writesthat libertarians, broadly speaking, have long aimed to privatize the state in far-off locales, reconfiguring government according to their own self-interest.
The misadventures of Adventure Capitalism’s motley crew of freewheeling libertarians—organized around the exploits of the financier and activist Michael Oliver—are riddled with contradictions and conditioned by colonialism. Indeed, Murray Rothbard, perhaps the architect of modern libertarianism, derided exit projects as “cockamamie stunts.” Libertarians, he advised, should work to reform existing institutions rather than squandering political capital on farcical escape plans.
But Craib argues that outright dismissal explains neither exit projects’ drivers nor their present resonance. Fantastic escapes from laws, regulations, and oversight are commonplace among today’s elite hyper-capitalists and their consequences are nothing if not tangible. In both Super-Cannes and Cocaine Nights, Craib notes, Ballard rightly shows that “it is the wider populace that will absorb the costs of elite agency.”
Freedom, as it were, does not come free.
Michael Oliver, born Moses Olitzky in Lithuania in 1928, was the sole survivor of the Holocaust among his immediate family. Liberated from Dachau by American GIs, he emigrated to the US in 1947 and settled in Nevada. There, he amassed a small fortune selling gold and silver coins as “security investments” and was drawn to the burgeoning libertarian movement.
Oliver’s traumatic confrontation with totalitarianism left him with a certain “political agoraphobia,” the specters of centralized government power and unruly masses looming large in his mind. An avid reader of Ayn Rand, he scorned the New Deal and welfare economy. In the Civil Rights and antiwar movements, he saw threats of mob rule and populist violence. He tacitly supported figures like the Koch brothers and elite conservative think-tanks, both of which assailed the regulatory state in defense of corporate profits and private wealth. Simultaneously, impending ecological and monetary crises, as well as nuclear war, seemed just around the corner in the midcentury US. A dizzying nexus of sociopolitical anxieties led Oliver to publish A New Constitution for a New Century in February 1968. Simply put, he wanted out.
Oliver’s manifesto sold well and earned him a cult following supportive of his “moral experiment.” He outlined plans for establishing “a self-governing, private territory in which the very promises of libertarian theory could be fulfilled.” The world’s oceans had become increasingly important zones for both resource extraction and Cold War geopolitics, driving separatist exploits further into the perceived periphery. As a result, Oliver invoked the lawless mythology of the high seas, dotted with distant islands—à la Robinson Crusoe—that he believed were ripe for social and political experimentation. He looked to the Third World, where, in the political flux of decolonization, he saw opportunity. First in Tonga, then in Abaco, and then again in the New Hebrides.
“The Republic of Minerva,” as Oliver decreed it in 1971, started as a section of concrete-dredged coral reefs in the South Pacific. Here, Oliver’s first attempt to create a tax-free utopia—where government and social services were to be bought and sold voluntarily by private entities—began to take shape.
However, the Minerva project was underpinned by racist views of Tongan political legitimacy. Though Oliver thought the reefs to be terra nullius, they were historically significant territory for the archipelagic Tongan people. King Tāufa‘āhau Tupou IV, who had brokered Tonga’s independence from Great Britain in 1970, swiftly repelled Oliver’s advances. Ordering the construction of a pair of lighthouses atop the reefs, Tupou IV formally incorporated them into the Kingdom of Tonga, ousting Oliver and his backers in doing so. As Craib puts it, a “free private city is another name for an expansive, private, exclusive country club…in someone else’s country.”
For Oliver, this was only a temporary setback. The ocean was vast and land aplenty.
In early 1973, Bahamian independence divided the Abaco Islands. While most residents supported the nationalist groundswell, a secessionist faction—reflecting racial and class divides, as well as the influence of British capital—coalesced in the Abaco Independence Movement (AIM), which sought self-determination for Abaco within the greater Bahamas. This political feud piqued Oliver’s interest, leading him to throw his weight behind AIM as he believed an independent Abaco would be a malleable host for him to shape as he saw fit.
In what Craib appropriately terms “libertarian noir,” Oliver enlisted the services of a shadowy cabal of ex-CIA men, disgruntled mercenaries, and tax haven-hungry financiers in a plot seemingly lifted from a Bond film. He cavorted with Mitch WerBell III, an arms dealer famous for developing firearm silencers, a former OSS operative, and all-around grifter who epitomized the covert netherworld where paranoid anticommunism met paramilitary insurgency. WerBell and other soldiers of fortune—many culled from the pages of the eponymous magazine—drilled on Abaco, readying for what promised to be an increasingly violent clash.
It was not chance that brought libertarians and mercenaries together; they found much common ground ideologically and materially. Like Oliver, many of these professional soldiers saw themselves as defenders of freedom, “struggling against a tide of corruption, malaise, and social collapse in a dark and threatening world.” And like Oliver they chased profit, “bound, in intimate and inextricable fashion, by the coin itself.”
But the secessionist cause splintered. Previously supportive residents of Abaco distanced themselves from AIM after learning of the brewing conflict. Foreign backers jumped ship, dubious of Oliver’s “kingly pretensions” and dwindling chances of success.
Undeterred, Oliver would again attempt to create a market-based state on Santo, the largest island in the volcanic South Pacific archipelago of the New Hebrides. As on Abaco, the formal transition away from colonial government that began in 1975 birthed competing political factions. While the socialist New Hebrides National Party wanted to purge British and French influence, the Nagriamel Party, led by Jimmy Stevens, pursued accommodation.
Stevens soon received funding, weapons, and strategy from Oliver’s new Phoenix Foundation. Oliver and his posse speculated that a Nagriamel regime would indulge their financial and development schemes. By June 1980, tensions on Santo reached a boiling point. Nagriamel staged a short-lived uprising that landed Stevens in prison and discredited Oliver’s project.
It is easy to overstate Oliver’s influence in manufacturing the Santo debacle. Over-assigning agency to his milieu neglects the authentic, native political struggles that emerged during decolonization. “As much as the Phoenix Foundation used Stevens for its own purposes,” Craib writes, “Stevens used Phoenix for his.” On Santo, a French official quipped that the American venture capitalists were “looking to reproduce life as it was in ‘Guatemala in the good old days.’”
The intoxicating swill of myopic nostalgia and hubris doomed their enterprise from the start.
Craib correctly dwells on the contradictions in Oliver’s capers. He claimed to be “dictating human freedom” and rather than putting an end to politics—an oft-emphasized criteria for “freedom”—his exit projects worked to transfer political power to their proponents, typically an exclusive group of wealthy property owners. Yet as the twentieth century wore on, aspects of Oliver’s political program migrated into the mainstream, albeit in novel ways.
The market-centric politics of midcentury libertarians paralleled those of a rising class of neoliberal thinkers and policymakers whose project took shape in the wake of epochal social upheaval and political tumult, much as Oliver’s had. And they too devised elite-led governmental structures that sapped power from the unruly masses and ensured market liberalization, privatization, and deregulation. It is important to note an aesthetic difference: where neoliberals construct state and global apparatuses to insulate markets, libertarians aim to dissolve the state in order to prevent it from obstructing markets. In either case, the result is a political system catered to the short-sighted interests of a privileged class, content to outsource its dire consequences—inequality, climate change, and violent conflict—to everyone else.
Highlighting this strange kinship, Craib gestures to the fractal legacy of libertarian exit. “The Californian Ideology”—so termed by the English media theorists Richard Barbrook and Andy Cameron—is among its most ubiquitous descendants. Equal parts hippie separatism and yuppie entrepreneurialism, its adherents place unbridled faith in technology’s emancipatory power to subvert quotidian political realities. Unsurprisingly, this techno-libertarian doctrine has become Silicon Valley orthodoxy.
From the dark corners of this world comes the billionaire venture capitalist Peter Thiel. Recalling Oliver’s island escapades with his credo that freedom and democracy are incompatible, he has attempted to build isolated doomsday-bunkers in New Zealand and funded the Seasteading Institute—a libertarian non-profit organization dedicated to building floating cities in international waters. In pursuit of a private state, Thiel fittingly advocates that libertarians look to three frontiers: cyberspace, outer space, and the ocean. It appears, too, that he now has designs on the small island nation of Malta.
Other extant fantasies of elite escape have taken on distinctly sci-fi trappings—consider the off-world aspirations of Elon Musk’s Martian colonies or Jeff Bezos’ plans for a commercially developed “Orbital Reef” space station.
Taken in context, Craib reveals that Oliver’s experiments were less historical asides than trial runs for forms of social and political exit still coming of age today.
Earlier this summer, outside investors on the Honduran island of Roatán found themselves in a standoff with local authorities. The investment group, Honduras Próspera Incorporated, planned to create a “start-up city,” advertising its ability to elevate “human potential through radically human-centered governance.” Though Próspera masqueraded as a charitable organization to gain local support, their project entailed extensive developments—designed by famed architect Zaha Hadid’s firm no less—that threatened to displace islanders, along with a wholesale adoption of decentralized finance and governance by “consumer-citizens.” But the Honduran government repealed laws permitting Employment and Economic Development Zones, or ZEDEs, that had provided a legal framework for Próspera’s venture. Citing “legal stability guarantees,” Próspera now demands that their community receive official sanction.
The contemporary rise of such semi-autonomous locales can be traced to Paul Romer, the former Chief Economist of the World Bank and co-recipient of the Nobel Prize in Economics. While Romer had conceived of charter cities as a corrective for “underdevelopment,” they effectively established deregulated spaces for capital accumulation, premised around “voluntary” participation. In 2009, following the coup d’état of Manuel Zelaya, Craib writes that Honduras’ new conservative ruling party seemed “eager to leverage private solutions” to their nation’s problems.
Despite being bound up in the language of freedom, the Honduran government’s embrace of ZEDEs neglected the fact that the Honduran people had no say in the matter. As Craib summarizes, “privatized exit seems to have emerged victorious over democratic and collective voice.” A curious inversion of freedom, indeed.
Xiomara Castro, Honduras’ newly elected president, made ZEDEs a central campaign issue and has pushed for their expulsion. The fate of Próspera’s project remains uncertain. A chorus of US think-tanks and politicians continue to feverishly pitch ZEDEs as a global necessity. On Roatán, though, the stakes are high. Millions of dollars and the livelihoods and way of life of the island’s 100,000 residents hang in the balance. An extensive legal battle looms.
“Have privatization and radical individualism become so hegemonic,” Craib asks, “that the most that can be mustered as a vision of freedom… is an exclusionary world of private floating condos on the ocean?” Signs that such a brave new world is upon us abound—neoliberalism has commodified government to the detriment of mass politics, globalization has wrought staggering inequality, and militarized violence in the name of capital is the order of the day. Official remedies for the present polycrisis are often couched in market principles. In excavating the troubled history of libertarian exit, though, we can at least better understand what we are up against.