History teaches that order requires a throne. Without a king, a parliament, or an army, civilization unravels.
Or so we are told.
Two episodes from medieval Europe suggest otherwise.
In 1361, the Danish king Valdemar IV conquered Visby, a semi-autonomous republic and key trading hub of the Hanseatic League. After further skirmishes and a failed truce, the Merchants stood together, allied with Sweden, raided Danish coasts, blockaded Danish trade, and won total victory.
With the Treaty of Stralsund, Denmark granted free passage and veto power over future Danish rulers. Peaceful merchants without a standing army had gained enough teeth to stand up to mighty kings.
More than three centuries earlier and farther north, a civil war was brewing and threatening to destroy the Icelandic Commonwealth. Norwegian King Ólafur Tryggvason was forcibly reintroducing Christianity and threatened to kill all Icelanders in Norway.
It looked like this civilization without a central executive would be destroyed after barely three generations. And yet, as we will discuss below, a solution emerged—a solution that few legal systems before or since have attempted. As a result, this stateless society survived for more than two additional centuries.
A stateless island that narrowly avoided a bloodbath and merchants who sank a king's economy may sound like fairy tales. But history reveals that private cooperation not only exists but also provides powerful solutions and can stand up to mighty aggressors. Peaceful order doesn't need a throne.
A Strong Trade Union
In 1260, German city-states Hamburg and Lübeck, which had been trading for decades, were joined by Cologne, Rostock, and Wismar to form the Hanseatic League.
In the following century, 200 associate territories joined to profit from access to a large market, standardized measures, and collective bargaining power. Together, this economic bloc could tackle challenges that no single member could handle alone.
Commercially, the League's success rested on its dominance of Baltic and North Sea trade routes, where critical commodities like fish, timber, grain, furs, wax, and honey changed hands.
Though it had grown powerful over the decades, it did not pursue conquest. If conflict emerged, diplomatic solutions and blockades were tried first. However, this peaceful pressure could quickly escalate to violence if threatened.
Apart from the conflict with Valdemar Atterdag of Denmark, there were three other major conflicts. When defending itself, the Hanseatic League punched well above its weight, with two more (partial) wins against Denmark and a win against England. As a commercial federation, the League fought not for thrones but for trade rights and privileges.
Although the Hanseatic League was largely based in the Holy Roman Empire, which was itself a fascinating story of decentralized collaboration, it spanned the territory of modern-day Germany, Latvia, Russia, Estonia, Poland, Sweden, and others.
Power Without Unity
However, this large association was not a single, centrally controlled bloc. League rules were enforced not through violence first but through the threat of being kicked out of the network, blockades, embargoes, and loss of reputation.
Losing your reputation as a trading city could destroy your future prospects. These enforcement mechanisms had teeth. If necessary, the League used naval raids and war.
The League was not perfect, of course. Infighting was constant. Internal factions and alliances formed. Coastal cities’ interests differed from those of inland towns. Take the war against Valdemar IV. Even at this critical stage of its existence, the League was far from unified. Some towns were ready to go to war. Others only pledged financial support. Towns in Westphalia could not even be motivated to do that.
Nonetheless, the Hanseatic League found a way. With this win against the Danes in 1368, the Hansa reached its zenith. It remains a fascinating case study of a decentralized alliance whose members could hardly agree on anything, yet created conditions in which commerce and cooperation could flourish.
Internal conflict within the league did produce some strife, but it also prevented the city-states from forming a large bloc. Conflicts were local and comparatively small. This stands in stark contrast to the wars waged by modern centralized states, which are frequently much larger in scope and tend to draw in more combatants.
A Stateless Island
Iceland's story, set three centuries earlier, offers a different but equally instructive example. In Iceland, the Althing was the national assembly where 39 chieftains and free men gathered to “govern” the island.
In the Icelandic Commonwealth, Grágás laws governed life. In contrast to modern laws, they were not designed to control every individual’s behavior and protect corporate cronies. Instead, they embodied standards of basic decency and handled penalties for murder and theft, bans on pagan sacrifice, and court procedures.
Consistent with this, medieval Iceland did not have a modern public prosecution system. Most cases were private suits brought by the injured party, relatives, or another eligible claimant.
Even some offenses considered “public” by modern standards were handled through a private right to prosecute and collect the fine. Homicide, for instance, was not a crime against the state but a wrong against the victim's kin, who held the right to prosecute, negotiate compensation, or pursue outlawry. Furthermore, these kin were responsible for enforcing whatever outcome the Althing reached.
A Different Kind Of Parliament
Parties could bring such disputes to the courts of the Althing. The loser had to pay compensation. Without police, the main forms of enforcement were outlawry and lesser outlawry. Lesser outlawry meant one had to leave the Island for three years. Being an outlaw meant that anyone could kill you with impunity.
Representation at the Althing was handled very differently from modern practice. Farmers and landowners had to pledge their contract-like allegiance to one of the chieftains. Unlike in feudal systems or modern democracies, this allegiance was not determined by geography or tribal ties.
Iceland was divided into four quarters, and you could freely choose which chieftain in your quarter to follow. If your chieftain didn’t fit your needs well anymore, you could switch alliances, creating competition among the chieftains. They were chosen based on protection in disputes, prestige, and practical considerations.
The system proved its worth under genuine stress. When the Norwegian king Ólafur Tryggvason threatened to kill all Icelanders in Norway unless the island converted to Christianity, the Althing did what no king could have ordered: it deliberated. In the year 1000, the assembly brokered a compromise: official conversion, with pagan rituals permitted in private. A civilization on the edge of civil war held together without a single sword being drawn in anger.
Like the German Confederation, Iceland’s system eroded when a few chieftain families amassed too much power. Support from Norway was critical for local chieftains to gain more influence, and the 1260s would see the end of the self-determined Icelandic Commonwealth as it became part of the kingdom of Norway.
Order Without Violence
In the modern world, it is easy to succumb to the fallacy of thinking that order can only be achieved with a strong central state.
The merchants of the Hansa, however, proved that trade can govern itself. Peaceful traders, coordinating across countless towns without central authority, brought a king to his knees.
Icelanders proved that law doesn’t rely on a central power either. With competition among rulers and the threat of outlawry, peace can be kept without state enforcement.
Through the mechanisms of trust, reputation, and exclusion, both were able to uphold basic rules without coercion. Though imperfect and occasionally chaotic, both lasted longer than the longest-lived modern republic, which celebrates its 250th birthday this year.
Neither a throne nor a ballot box is the source of civilization. Voluntary coexistence finds the least violent ways to live together.