In the 19th century, the line between the individual and the government was just as firm as it is now, but there was a large public space in between that was nonetheless seen as private in the sense of being mostly outside of government control -- which is why we still refer to “public" companies as being part of the “private" sector. Again, in the context of largely negative rights, this makes sense. You have individuals on one end and a small state on the other, and in the middle you have a large variety of private voluntary institutions that exert various forms of social and financial coercion, but not governmental coercion -- which, unlike other forms of coercion, is ultimately enforced by the government’s monopoly on the legitimate use of violence.McArdle's context (like Bookworm's) is the Hobby Lobby decision, and the progressives' conviction that not forcing an employer to buy an employee's abortifacient is the same thing as allowing a religious fanatic employer to impose its crazed right-wing views on helpless employees.
H/t Bookworm Worm.


