A Case for Private Towns

Issue 21.6, Auckland, 02 July 2021 

Are you happy with where you live?
More specifically, do you like your home… the people you call your neighbors… the feel of your community… the government that makes the rules… the reputation of the country that you identify with most closely… and the taxes that you pay in exchange for calling it home? If you could change something, what would it be… and would you?

Most people think long and hard about where to live – since, after all, there are few more important ingredients to happiness and prosperity than the place you plant yourself. And given the even more prominent role than usual that home has played in our lives over the past year, it’s worth reassessing what matters the most about what we call home – and taking action to change what doesn’t work.

Living by Choice
Obris members live in 18 countries on five continents. For many of us, where we live is a conscious choice to be able to maximize our quality of life, choose the level of government provisions and intrusions upon our lives, and minimize restrictions to growing our net worth.

And what is most important is the ability to live as we choose, where we feel safe and where we expect to experience the most enjoyment and freedom.

This may be driven by country, culture, climate, season, geography… everyone’s needs, of course, are unique.

The good thing is that we have a lot of options. Some popular destinations today include Puerto Rico, Turkey, Portugal and the Republic of Georgia. The state of Idaho in the US is a popular option amongst my libertarian friends.

Private Towns
A private town is a model for living freely that is an oasis of liberty and choice within a country that may – on their own – offer less-than-ideal governance.

By definition, a private town is owned by an individual, group or company. The owners establish an agreement with the local and/or national government whereby the government transfers the responsibility to provide some or all services to the owners of the town. The town then decides what services to offer its residents. It also defines the responsibilities of the town to its residents, and of the residents to the town, in a social contract.

Private towns have existed for centuries. Long before the industrial revolution introduced company towns, wealthy families and religious groups created their own private towns, independent of national governments and bureaucracy, and the restrictions on freedom that they impose.

For example, when Catherine the Great reclaimed Russian lands from the Mongol Tatars in Ukraine and Western Siberia in 1763, she invited all Europeans to inhabit the reclaimed lands. In exchange for their commitment to nurture the land, these immigrants were granted special freedoms that were not afforded to them in their homelands.

One prominent group of settlers were the Mennonites, a religious minority group from Western Europe. The Mennonites built their own autonomous communities and economic systems that prospered for nearly 150 years until Joseph Stalin’s Reign of Terror decimated all such communities that were deemed enemies of the state.

Orania, South Africa
One of the oldest private towns of the modern era is Orania, a semi-autonomous area in the North Cape of South Africa. In 1990, Orania – which was inhabited by nomadic hunter-gatherers 30,000 years ago – was purchased by a group of approximately 40 families for the equivalent of about $585K.

Their aim was to preserve Afrikaans culture and language in a country that at the time was determined to paper over the Afrikaans heritage. To this day, anyone is welcome to live in Orania if they identify as Afrikaner and share their common values of Afrikaner language and culture.

Private Towns Today
Private towns aim to redefine the social contract in a manner that allows individuals and communities to make their own choices, and to define their own level of governance – or lack thereof.

Most private towns are semi-autonomous. They assume some elements of self-governance, while they continue to rely upon the government for other provisions.

A growing number of recently established private towns dot the globe in countries like Norway, Honduras, Canada and the United States.

Liberstad is in the south of Norway. Its moniker is “a little piece of freedom.” According to their website, “Liberstad is place for individuals who enjoy freedom and private property rights. It is the foundation of Liberstad.”

The Liberstad project began in 2017. When complete, it will include a camp ground, land plots for private homes, rentals and a commercial center. Everyone – owners, renters and even visitors – are required to become a member and sign the member contract that defines rights and responsibilities for living in Liberstad.

Prospera on the Honduran island of Roatan is another example. Prospera is partnering with the Honduran government to create semi-autonomous economic development hubs that are separate from the rest of Honduras. The developers of Prospera Roatan believe that they are creating one of the best environments for commerce in the world.

Próspera partners with governments like Honduras to promote and operate Economic Development Hubs – similar to Special Economic Zones (SEZ). These hubs are integrated with local communities and have semi-autonomous governance and regulation.

With a common law legal framework, familiar and flexible regulations, a bill of rights, low taxation, and protections for the environment, Próspera enables entrepreneurs to solve problems structurally and responsibly for the people of Honduras and the rest of the world.

That is a refreshing approach to governance!

Fort Galt & Frenly Park
I recently interviewed Gabriel Scheare for our Global Investor Podcast. Gabriel grew up on the prairie of Saskatchewan, Canada.

The community where he was raised, like many rural communities in Western Canada, was predominantly self-sufficient. Most government services, including police and fire protection, were carried out by the community, not a government entity. Even most legal disputes were handled within the community.

In exchange for such a devolution of power by the government, Gabriel’s community had considerable freedom to live as they chose. They thrived.

With an entrepreneurial mindset and strong Ayn Randian ideals, Gabriel set off for Chile eight years ago. He interned for a real estate development project that was marketed as the world’s first community to sell land for Bitcoin.

The project eventually went sour, so Gabriel began pursuing his own dreams to build a community in Chile.

Over the past several years, Gabriel built Fort Galt, a private town on the country’s Pacific coast. He bought and developed land, brought in partners, built a lodge, marketed Fort Galt around the world and sold rooms and land plots to individuals and families who wanted to live freely.

But after a year of civil unrest, and retraction of most civil liberties by the Chilean government, further development of Fort Galt was put on hold – and remains so to this day.

Gabriel is still optimistic. His values have been tested but he still has a deep commitment to build private communities. In our interview, Gabriel told me about his plans to return to his native Canada, and to create another private town.

He returned to Saskatchewan last month, purchased land he had been eying, and launched Frenly Park which he currently defines as a country club. Gabriel’s goal is to grow Frenly Park from the ground up, and to incorporate as a village with a population of 300 people.

Please consider watching or listening to my interview with Gabriel as he shares the dreams, values and expectations that encapsulate his vision for Frenly Park.