Exactly, if he'd bother to, he clearly could. But he just seems to NOT, and seems to get easily caught off gaurd. He seems to only get aggressive in any way when pushed to the point - in Squid Defense, out of fear - and in almost any other episode, just when someone (often SpongeBob) had really pushed him and then he yells or throws them out of his house.. Just look at what all he *actually* tollerates.
He seems to be a very non-confrontational creature, to me at least.. and fighting isn't a sport he'd enjoy as SB and Sandy do, so he doesn't bother to further himself in the area.
As someone mentioned about 'Wishing You Well', he fought with Pat, ultimately, but I don't remember that we saw anything about who won... but, either way, he did apparently throw some blows with Pat... and ultimately was still able to crawl out when Krabs pulled the bucket up. (Though I also can't recall Patrick looking particularly beat up either - so I guess the fight wasn't THAT brutal? But it was funny! I love how it started with shoving..!)