The Cannae Tactic: How to Sell New Hampshire Self-Government

I have titled this talk, The Cannae Tactic, after the Battle of Cannae, which was fought in 216 BC between the Carthaginians under Hannibal and the Romans. Hannibal's tactical innovation was to place his greenest troops in the center and his veterans on the flanks. The center advanced to engage the Roman army, then withdrew as if in retreat. The Romans pursued them, thinking the battle was a rout, but then the veterans on the flanks surrounded them. The Roman army was completely annihilated, losing some 60 to 70 thousand men. I think there's an analogous tactic that could work on the important issue of New Hampshire self-government. In a moment I'll describe what I mean by that term.

When I came up with the idea of the Free State Project, I assumed that most of the people who would be moving would be activists in a very weak sense of the term, maybe donating $50 a year to local libertarian causes but not necessarily doing much else. For that reason I thought we might need as many as 20,000 activists to build a permanent majority in a state of this size. As it turns out, though, the majority of the people moving are Super-Activists. They are spending hours each week writing letters, testifying before the legislature, putting out newspapers, engaging their fellow citizens. What we've found is that now, Free Staters are dominating the testimony at the state legislature on bills that matter most to us.

What we need now is a true grassroots movement that will hold elected officials accountable every time. Once we have 1,000 activists in state, I think we will have that. We don't need 20,000 if the people that move in are Super-Activists.

But another thing that will help us achieve more with fewer numbers is smart tactics. We need to know how to sell our ideas, both to the public and to elected officials.

When it comes to policy reforms, political scientists have found that a frontal assault almost never works, especially in a system like ours in which power is diffused through three branches of government. Instead, you need something like the Cannae Tactic. Rule Number One for any reformist leader is: You can never destroy an adversarial interest group, you can only hope to co-opt them. For us libertarians, potentially adversarial interest groups might include labor unions, certain government employees, big businesses that get corporate welfare, the more extreme environmentalist organizations, and those elements of law enforcement who are more concerned about the size of their payrolls than true reductions in crime. These interest groups will never go away, and they will always effectively pursue their interests.

But perhaps, by initiating a tactical retreat on certain issues, you can bring these interest groups in and give them a stake in something much more important that you want. Thus, you can beat a retreat from school vouchers to distract the teachers' unions and instead offer something more beguiling: fully private, for-profit, teacher-owned schools. Handing the government schools over to the teachers would be a big financial windfall for them. Maybe some of them deserve it, and some of them don't, but the point is that you get their political support for a reform that ends up creating hard budget constraints, competition, and choice in schooling – the three things needed to make a truly world-class, innovative educational system.

Let's turn now to the issue of New Hampshire self-government, one of the biggest issues. What I mean by New Hampshire self-government is "New Hampshire control over New Hampshire affairs." It means getting the federal government to stop deciding issues for us and to let us make our own decisions.

At one extreme, self-government could mean complete independence, in which New Hampshire has control of its own foreign policy and defense. I realize a few people are promoting this idea now, but we can expect the vast majority of Granite Staters to oppose it, and a fair number of Americans, perhaps even a majority, who would favor the use of military force to end such an experiment. Complete independence is the frontal assault tactic, using a vastly outnumbered force to attack a citadel. The outcome – a massacre.

Self-government is the Cannae Tactic. Not only does ‘self-government' sound softer and more positive than ‘independence,' it makes more sense politically because it can bring in the left. Self-government could be arranged ad hoc, allowing New Hampshire to opt out of various taxes and programs, such as an agreement to devolve Social Security to the state and stop withholding Social Security taxes from New Hampshire residents' paychecks. This reform alone would mean an average annual tax cut of $490 for every man, woman, and child in the state, without any loss of benefits. If we got New Hampshire the right to opt out of income and estate taxes as well, in exchange for which we gave up all block grants and federal programs other than defense, then there would be a per capita benefit of $1324 per year, even if all spending remained the same. The way to push for these changes in Congress might be to sell them as "pilot programs" for reforms the federal government is considering anyway (such as President Bush's Social Security choice plan).

Of course, we wouldn't want all spending to remain the same; we'd want to privatize our Social Security program, eliminate corporate welfare, and generally reduce spending. If we eliminated all federal and state welfare programs and instead consolidated those programs into a single cash payment, we could give $8600 to every adult individual in New Hampshire while still trimming overall spending levels by about 10%. (I'm also assuming here that the state is still funding education and all non-welfare programs at the same level as today. I would also note that we could spend more than $10,000 per year on the poorest individuals if we means-tested benefits slightly.) This is a variant of the plan proposed by Charles Murray in his new book In Our Hands. He advocates doing it on the federal level, but I think that having the states decide on it as they choose makes more sense.

It should be obvious how the left might support such a plan, sometimes called a basic minimum income. Welfare recipients benefit because they are no longer restricted in what they can spend: housing, food, and so on. But the program doesn't damage work incentives because every individual gets it, no matter his or her income. It isn't a "pure" libertarian solution by any means, but it does cut bureaucracy very significantly. But this is the kind of program that will work best only when New Hampshire gets self-government, that is, the right to opt out of federal income and FICA taxes. The first reason is that it could not be adequately funded under the current system. The feds spend a lot on transfer programs, and what they give to us in block grants is tightly hedged by restrictions. The second reason is that New Hampshire is a net loser from the federal fiscal game. Self-government means another $1324 per person per year that we can use as we see fit.

To the right we can sell self-government as an automatic – and very sizeable – tax cut. To the left we can sell self-government as the ticket to more spending on the poor. To everyone we can sell the idea that New Hampshire can take care of its own problems better than Washington, DC can. We can draw in a wide range of interest groups and give them a stake in a reform that is very important to all of us here.

While I think self-government can be achieved on an ad hoc basis, it could also be achieved with a change in legal status for New Hampshire. There is a jurisdiction in the United States where residents do not pay federal income taxes. That is Puerto Rico. They do pay payroll taxes and benefit from Medicare and Medicaid, but that is by their own choice. They apparently do have the right to opt out of those taxes and programs. New Hampshire could, with congressional approval, also become a Commonwealth or simply an unincorporated territory of the United States. We would lose our voting rights in Congress and the electoral college, but New Hampshire has very little influence on the federal government as it is. This kind of change in status is obviously a much more drastic change than working on individual programs ad hoc, and as I've argued, it may be unnecessary.

There are of course other federal policies we'd like to change, such as federal drug laws. I don't think self-government or even independence has an answer to this sticky issue. Look at what happened when Canada made timid moves toward legalizing marijuana. The U.S. government essentially threatened to shut down trade from Canada unless they fought the drug war the way the American government wants them to. I don't know what the answer to the federal drug war is, other than using our foothold here as a bully pulpit to proclaim the need for reform.

In my opinion, "dealing with the feds" should probably wait until we've privatized the schools, repealed business licensing, and made other necessary reforms at the state and local levels. But libertarians being what they are, my guess is that there will be different groups of people working on all kinds of different things, all at the same time. I predict that self-government will become the lynchpin of any successful New Hampshire autonomy project, and that in order to succeed, its supporters will have to sell it in a way that appeals to the vast majority of Granite Staters, regardless of ideology, party, class, race, creed…whatever. At that point self-government becomes a matter of simply doing what is in the interests of everyone in our state, rather than contested ground in an ideological war. The broader point that I hope I have supported is that, by using the Cannae Tactic, our First 1000 will leverage their numbers even more powerfully to create change in New Hampshire. Exciting things are already happening, but the best is yet to come. Sign up, and join the party.