Lake of the Woods was conceived as a recreational community that would be completely funded and controlled by its owners. Construction began in the late 1960s when U.S. Wildlife Clubs, Inc., purchased 17 adjoining farms totaling 2,600 acres to form the community. They dammed up streams on the property to create three lakes, the largest of which is 550 acres. They built two marinas, eight public beaches, an 18-hole PGA golf course, four parks, a campground, four tennis courts, two soccer fields, a lighted baseball diamond, and a horse stable. They constructed more than 40 miles of hard-surface roadways to access the 4,264 home lots that were planned, and the entire community is now protected by a private police force.

The community has flourished. Currently there are more than 2,700 homes in Lake of the Woods. Commercial businesses have sprung up outside the community — including several restaurants, a grocery store, and a bank — in response to the demand created by increasing numbers of people.

But most impressive has been the way in which the community is run. All of the day-to-day business of the community is handled by the homeowners’ association, of which every lot-owner automatically becomes a member. The association is responsible for using membership dues to maintain the infrastructure of the community, put on events such as the Independence Day celebration, and plan for large-sum contingencies such as repaving the roads and keeping the lake dams in good repair. And at a time when most county and state governments are facing enormous fiscal strains, the homeowners’ association is flush with cash. They are currently considering building a private gym and an indoor swimming pool for the community.

If private individuals can have such success in governing themselves through voluntary association, why is it that we allow our governments to take our money to achieve the same ends, but never with the same success? County governments provide many of the same services that Lake of the Woods is providing. They provide parks, roads, fishing lakes, recreational centers, and much more.

But there are two important differences.

First, the service is sub-par. Lake of the Woods has perfectly maintained roads, clear lakes with trophy-size fish, and clean amenities. Government-provided services are always different. As any fisherman knows, public waters are absolutely the worst places to go fishing. They are always overfished and much of the time the water is polluted so much that any fish caught are inedible. County roads are often full of potholes, littered with garbage, and often congested with traffic. Almost everything that Lake of the Woods does, it does far better than county governments.

Second, and more important, the county must get its funds through the coercive method of taxation. It builds its roads and parks at the point of a gun. Homeowners’ associations are voluntary by definition (hence the word “association”). Everything accomplished through a homeowners’ association is the result of contractual arrangements — a completely peaceful method of achieving the same ends that the county uses violence to achieve. Why would any principled person prefer the latter to the former?

So the Fourth of July was that much more pleasant for me. I was able to sit on a private lake instead of a public square, fish for privately owned fish instead of publicly owned fish, and watch a privately funded Independence Day celebration instead of a fireworks show obtained by the thieving state.

That is what liberty is supposed to be about.

Bart Frazier is program director at The Future of Freedom Foundation. Send him email.