There might very well be a libertarian monarchy, but it wouldn't be a traditional Catholic monarchy, based on the Papal Social Teachings.
From The Mad Monarchist
Yes, it is true that libertarian monarchists exists and, in the past, I was surprised at how often I encountered them. In the past, I have touched on how the very monarchial Middle Ages was perhaps the closest the world has ever come to the totally privatized society that many libertarians dream of. What is prompting this second look at the subject is the number of times since then that I have seen libertarians express amazement at the very notion of a libertarian monarchist. Whether libertarianism is your cup of tea or not is besides the point here, there should be nothing all that shocking about the idea of a libertarian being a monarchist. It is a school of thought that is not inherently contradictory to monarchy in the way that communism or socialism is (socialism being communism for slow learners). After all, socialism is about making everyone equal, treating everyone the same and using the power of the state to eliminate any sort of discrimination. Granting that there are monarchies today which are highly socialistic, at its core this is obviously something that is contradictory to the very nature of monarchy which, let us face facts, is based on a certain amount of discrimination, that everyone is not the same and will not be treated exactly the same.
Libertarians, on the other hand, who support pure capitalism, accept as well that total equality is impossible and not even desirable. They accept that, in a free market, some will do better than others, some will have more, others less, and as a result of competition, ‘the cream will rise to the top’ as they used to say. Some may choose to be dishonest about it or try to cover it up with republican sounding language, but the fact is that it is inherent in any capitalistic system that there will be a natural elite that emerges. That is true for anything, and even the most socialistic, communistic governments that ever failed all still had an elite but they always deny it or try to explain it away as being only temporary. Libertarians accept that some will succeed, some will do better and so there will be inequality in any free society. In fact, I am rather surprised that any libertarian would look disdainfully on monarchy at all. Not every monarchist is a libertarian certainly (many would shudder at the notion) but every libertarian should be a monarchist if they were to take their own ideas to their ultimate, logical conclusion. Given that most libertarians accept and understand the inherent inequality their ideal system would create, that they have no problem with this and even celebrate it as a positive thing, it should be more surprising that any would still express egalitarian sentiments when it comes to the idea of monarchy.
Based on what I have seen, this usually comes down to the idea that, since libertarians think anyone should have the freedom to do whatever they want, it is absurd to say they do not have the right to choose their head of state. I must confess, that sort of “logic” never made sense to me. I thought libertarianism was about having the right to make decisions for yourself, not for other people. That is what democracy is all about; 51% of the herd making decisions for the other 49%. Voting on the head of state is making a choice that will affect not only you but others as well. At the very least, you are telling two men what they will be doing with the next four years of their life (or however long the term of office may be). I thought libertarianism was about the freedom to make choices that affect you and not making choices that will affect others. In fact, the “logic” of making the top job determined by democracy always seemed to me to go against the core principles of libertarianism. If anything, it seems the exact opposite of what libertarianism should be all about. If one of the core, fundamental principles of libertarianism is that an individual is superior to a collective, I fail to see how there is anything libertarian about letting individuals decide everything and yet when it comes to deciding who should hold the position of head of state still insisting that that decision must be left up to the collective.
After all, no libertarian worth his salt would say that decisions in a company should be made by the democratic will of the workers at that company. Libertarians would agree that property controlled by an individual will fare better than it would under the control of a collective, therefore it only stands to reason, according to libertarian principles, that a country should be governed by an individual rather than a collective as well. One libertarian who has pointed this out, quite admirably, is the economist Hans-Hermann Hoppe in his work, “Democracy: The God that Failed”. He has, for some time now, made the case that traditional monarchies were governed far better than democracies because a monarch is, or at least sees himself as, the “owner” of his country and takes care of it as diligently as one would one’s own property whereas the democratically elected politician is only a temporary caretaker of a country and works only to loot as much from it as he can, while he can, before his term in office is over. As Hoppe explains it, monarchy is a private form of government while democracy is a collective form of government and, as a libertarian, he finds monarchy superior for that reason. He also has history and economic patterns to support him, particularly if one looks at the traditional monarchies of the Middle Ages when “government” was miniscule, taxes were intermittent to non-existent, spending was low, war debt was about the only kind of debt there was and even wars themselves were fought in a limited fashion by monarchs who had specific objectives and who did not wish to waste their armies which were expensive to train, equip and maintain.
Libertarians also heavily emphasize the right to private property and certainly there should be no room for debate that democracy is more detrimental to private property than monarchy. Since the days of ancient Greece it has been known that democracies fail once people discover that they can vote themselves the property of others. The takers drain the producers dry and society collapses as a result and this always happens because, whether it is a direct democracy or a representative democracy, politicians learn just as quickly that the way to attain and hold on to power is to take from the minority and give to the majority. No one ever voted against a politician who promised them more free stuff. On the other hand, while nothing is absolute, a monarch is in an inherently superior position to safeguard private property even if only for his own sake. As King Charles I said in his final statement at his trial, in defending his own rights, he was defending the right of every subject to that which was legitimately his own. If the majority is allowed to take from the minority, what would stop them from taking from the monarch as well? He is, after all, the ultimate minority as there is only one monarch. Nothing, so the monarch would wish to prevent that from ever happening.
In fact, one could argue that a traditional monarchy is the only way a libertarian country could be ruled because every other system involves the rule of a collective of various sizes whereas individual leadership on a national level can only be exercised by a monarch or a dictator. For those inclined to think a dictator might be better, think again. A dictator is driven by political ideology and usually does not pass on his leadership to his own blood. Some have, such as in Syria and North Korea, but they are still tied to deeply flawed political ideologies. Now, if your imaginary dictator is without a political ideology and has a dictatorship that is hereditary, one would be forced to ask exactly how that is different from an old fashioned absolute monarchy. Certainly, it would require some extremely precise splitting of hairs and, in that case, can be consigned to the bin of those things which have no substance to them at all and are only introduced to a conversation to cause difficulties and disputes over terminology.
Today, there is no country that could be considered a libertarian paradise. Many countries are moving or have moved in a more libertarian direction on social issues (legalizing prostitution, drug use, homosexuality, gambling and abortion) but very few have moved consistently in a libertarian direction on the economic front but have, on the contrary, clung to the ideas of mixed economies or socialist economies with central planning, state redistribution of wealth, high taxes and large amounts of regulation. Yet, on the economic front, none can dispute the success of such monarchial micro-states as Monaco and Liechtenstein or autonomous dependencies of monarchies such as the Cayman Islands or the Isle of Man. These countries have very low taxation, very low regulation and all the ensuing economic freedom has made them fabulously wealthy places. They also have a monarch who rules them directly or a representative of a monarch to treat them with benign neglect (and don’t knock it, Hong Kong became the envy of Eternal Asia through benign neglect). In the case of Liechtenstein and (possibly more so) Monaco, being the Sovereign Prince has often been compared with being the owner of a large company. Such companies must be well administered as they are both very prosperous and have populations that certainly do not feel oppressed, who are pleased to be able to keep the fruit of their labors and who overwhelmingly support their monarchies and are not dissatisfied with the amount of power held by their prince.
The problem, it seems, is that many people, even many libertarians, have it ingrained in their minds that democracy=liberty and thus a libertarian should oppose monarchy and support democracy. In fact, democracy is no guarantee of personal liberty nor is it an effective check on state power. The President of the United States today has more power over the lives of his “fellow citizens” than King Louis XIV of France ever had over his subjects. Democracy is only a method of choice and contrary to what so many seem to think, personal freedom can quite easily be voted away in a democracy. In The Federalist Papers No.25, American “Founding Father” Alexander Hamilton wrote, “For it is a truth, which the experience of ages has attested, that the people are always most in danger when the means of injuring their rights are in the possession of those of whom they entertain the least suspicion.” This is true and it is exactly why democracy has brought about far greater tyranny than traditional monarchies ever did or ever could. The closest the world ever came to a privatized society was in the monarchial Middle Ages and while it is, in theory, at least possible that a more libertarian society could come about in a monarchy, it is impossible to believe that a democracy could ever be libertarian when everyone is always just one vote away from having it all come crashing down. Again, not every monarchist must be a libertarian (I am not one and am not trying to convert anyone to it) but, given the facts, every libertarian should certainly be a monarchist.