Private Provision of Public Goods, Mario Puzo Edition

12 May 2007 at 12:21 am 7 comments

| Peter Klein |

Nicolai tells me The Sopranos is the most popular show among Danish libertarians. I bet they like the Godfather trilogy as well. What libertarian can resist this classic exchange between Michael Corleone and Kay Adams in the first film:

Michael: My father is no different than any powerful man, any man with power, like a president or senator.

Kay: Do you know how naive you sound, Michael? Presidents and senators don’t have men killed.

Michael: Oh. Who’s being naive, Kay?

The films are terrific, but the original novel by Mario Puzo is even better. (The newer books by Mark Winegardner aren’t bad either.) One of Puzo’s themes, which isn’t emphasized so much in the movies (aside from the opening scene in the first film), is how the Mafia functioned as a kind of private government, providing protection for people, primarily poor immigrants, who were refused protection from the inefficient and corrupt formal legal authorities.

I was reminded of this by some recent posts on the Volokh Conspiracy. Notes Ilya Somin:

Everyone remembers Don Corleone’s famous saying that he’s going to make “an offer you can’t refuse.” But for some reason, people forget that the Don also said that “a lawyer with his brief case can steal more than a hundred men with guns” (Godfather, pbk. edition, 52). One of the recurring themes of the novel is that people turn to the Mafia for help because of the corrupt and self-serving nature of many political and legal institutions that systematically allowed elites to plunder the politically weak. Puzo recognized, as sociologist Diego Gambetta explained more systematically, that the Sicilian Mafia flourished because it provided better “protection” against crime and violations of property and contract rights than did the official authorities, who generally protected only the politically powerful elite. To a lesser extent, a similar dynamic enabled the America Mafia to emerge in Italian immigrant communities in the early 1900s, as Puzo vividly portrayed in his chapter on the rise of Don Corleone.

Murray Rothbard put it this way, with his characteristic flair: “The key to The Godfathers and to success in the Mafia genre is the realization and dramatic portrayal of the fact that the Mafia, although leading a life outside the law, is, at its best, simply entrepreneurs and businessmen supplying the consumers with goods and services of which they have been unaccountably deprived by a Puritan WASP culture.” Right on! Moreover:

The unforgettable images of mob violence juxtaposed with solemn Church rites were not meant, as left-liberals would have it, to show the hypocrisy of evil men. For these Mafiosi, as mainly Italian Catholics, are indeed deeply religious; they represent one important way in which Italian Catholics were able to cope with, and make their way in, a totally alien world dominated by WASP Puritan insistence that a whole range of products eagerly sought by consumers be outlawed.

Henry Farrell didn’t like Somin’s interpretation (but see his rejoinder in the post cited above). Bob Murphy , writing from a Rothbardian perspective, gives Gambetta’s Sicilian Mafia a mixed review. Henry Hill, as portrayed in Martin Scorcese’s Goodfellas, describes a similar protection scheme, though limited to members of the Mafia families themselves: “All they [the mob members] got from Paulie [the Don] was protection from other guys looking to rip them off. That’s what it’s all about. That’s what the FBI can never understand — that what Paulie and the organization offer is protection for the kinds of guys who can’t go to the cops. They’re like the police department for wiseguys.”

Update: Mark Steckbeck sent me a sound file of the exchange between Michael and Kay.

Entry filed under: - Klein -, Classical Liberalism, Institutions.

The Legacy of Max Weber Colin Camerer on Strategic Management

7 Comments Add your own

  • 1. Kevin Carson  |  13 May 2007 at 1:32 am

    A friend of mine grew up in Reno, and he noted the a.most total absence of petty street crime in areas under Mafia contol.

    That scene from The Godfather brought a chuckle. It brought to mind a quip from Secretary of State George Schultz during an appearance before the Senate in the mid-80s. They were holding hearings on the anti-apartheid movement, and Schultz chided an ANC-friendly Senator by saying (rough paraphrase) “I can’t believe someone in this august body would actually sit here and advocate violence.” This from a guy who typically ordered death rained from the skies on six countries before breakfast–not to mention the Contras and Salvadoran death squads, trained in the fine arts of torture, murder and disappearance at Ft. Benning, were turning disembowelment and decapitation into an art form.

  • 2. Matt Elliott  |  13 May 2007 at 10:55 pm

    I’m surprised that you didn’t talk about opportunism with this examiniation of mafia organization and behavior. As you highlighted in your discussion, the opening scene, of the original Godfather, showed how the mafia protection was offered in absence of government protection, but unlike the government that asks for basic taxes, the mafia ‘would call on you to perform a service to your Don in the future…and you must accept’ Granted in the first movie the service asked of the mortician, to fix Sonny’s mangled corpse, was not an extreme request. However, the second movie implicity layed out how Fredo was forced to sell out his brother MIchael Corleone to Hyman Roth and the Risotto brothers so Fredo could create something for the family “on his own”.

  • 3. Peter Klein  |  14 May 2007 at 3:18 pm

    Hmmmm, maybe Akerlof’s theory of gift exchange applies here? (I’m sure our sociologist friends will have something to say about this. . . .)

  • 4. asg  |  15 May 2007 at 2:51 pm

    Pretty sure Ilya Somin’s a guy :)

  • 5. Peter Klein  |  15 May 2007 at 2:53 pm

    Quite right, my apologies to Ilya. Now fixed.

  • 6. Libertarians on The Godfather, Part II « EconLog  |  15 May 2007 at 7:00 pm

    […] You’ve read Somin; now try Peter Klein. […]

  • 7. David Hoopes  |  21 May 2007 at 11:52 pm

    I’m a bit surprised George Schultze is saddled for Iran-Contra responsibility. The State Department was left out of the loop on that deal. I remember when he was before Congress. He said something to the effect of, “People say that the State Department can’t negotiate very well. Yet here they traded hostages for weapons. What kind of deal is that?” I thought he was great before the Senate.

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

Trackback this post  |  Subscribe to the comments via RSS Feed


Nicolai J. Foss | home | posts
Peter G. Klein | home | posts
Richard Langlois | home | posts
Lasse B. Lien | home | posts


Former Guests | posts


Recent Posts



Our Recent Books

Nicolai J. Foss and Peter G. Klein, Organizing Entrepreneurial Judgment: A New Approach to the Firm (Cambridge University Press, 2012).
Peter G. Klein and Micheal E. Sykuta, eds., The Elgar Companion to Transaction Cost Economics (Edward Elgar, 2010).
Peter G. Klein, The Capitalist and the Entrepreneur: Essays on Organizations and Markets (Mises Institute, 2010).
Richard N. Langlois, The Dynamics of Industrial Capitalism: Schumpeter, Chandler, and the New Economy (Routledge, 2007).
Nicolai J. Foss, Strategy, Economic Organization, and the Knowledge Economy: The Coordination of Firms and Resources (Oxford University Press, 2005).
Raghu Garud, Arun Kumaraswamy, and Richard N. Langlois, eds., Managing in the Modular Age: Architectures, Networks and Organizations (Blackwell, 2003).
Nicolai J. Foss and Peter G. Klein, eds., Entrepreneurship and the Firm: Austrian Perspectives on Economic Organization (Elgar, 2002).
Nicolai J. Foss and Volker Mahnke, eds., Competence, Governance, and Entrepreneurship: Advances in Economic Strategy Research (Oxford, 2000).
Nicolai J. Foss and Paul L. Robertson, eds., Resources, Technology, and Strategy: Explorations in the Resource-based Perspective (Routledge, 2000).