I said no such thing. Please do not put words into my mouth.
Industry does not exist without people and people make government to govern themselves.
Government is just that, a system which governs. That is what you said. My point was that your previous post made it seem like you were equating people with government as though both are necessary for their mutual existence. Yes, governments need people to run them, obviously, but people do not always organize into governments. There have been anarchic societies.
Yes they are. The demand for police protection in a city increases due to increase in crime. The supply of police officers, however, is low. As a result, residents move away, reducing the tax money of the local government, which in turn reduces the demand of police officers. As businesses also leave, the demand decreases even more.
But a local government can't exist without people so incentives are created to get people to move back. The city blocks are made more ascetically pleasing. Taxes for businesses and property are lowered.
These are not the acts of a system that can create money without fear. These are the acts of a business.
But that is all after the government has already taken tax dollars out of citizens checks to pay for the police department and to pay police officers to patrol and all that. A government without industry cannot open a police station or have officers on its payroll because it has no money. That's the difference.
A business usually as an accounting department that handles all monetary needs.
Accounting departments don't print money.
Many things:
Land.
The right to gather resources.
Protection from unfair deals or damage.
Monetary protection from theft. (FDIC)
Skilled labor force. (schools)
Stable currency.
Settling of disputes. (court system)
Safety.
And, a customer base.
Many of these things couldn't exist without a form of common law, common currency, and common culture. If we lived in pure anarchy, a business owner could easily be murdered and all his possessions stolen. He would have to spend goods or services (not money) to get protection from such things. He would also have no protection should another business decide to stop him from conducting business by creating an unfair environment. Like say... using force to keep a town from trading with someone.
But since government exists in something even as small as a family, to say that a world would exist without any government would be one where human civilization does not exist.
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If we were in pure anarchy I think things would be a lot different, for instance, the shop owner in your example would probably be heavily armed anyway.