About this Issue
If we are going to have a government at all, is there any way to keep it limited to a few basic tasks, or must we reconcile ourselves to an out-of-control leviathan? Can well-designed constitutions keep government reined in, or is any set of limiting rules bound to be undermined over time? Suppose we can’t realistically expect a classical liberal limited government. It remains that existing liberal democracies are not unlimited. Aren’t there better and worse ways for big government to be big? Do classical liberals and libertarians have anything constructive to say about this? Or should they rather devote themselves entirely to railing against the illegitimate status quo?
To tackle these big questions, we’ve assembled a crack team of political and legal theorists, starting with Anthony de Jasay, who kicks off with a lead essay reprising the theme of his 1989 essay, “Is Limited Government Possible?” Commenting on de Jasay, we’ll have University of Arizona political philosopher Gerald Gaus, author of On Philosophy, Politics and Economics; Michael Munger, chair of the Duke University political science department; and Randy Barnett, professor of law at Georgetown University and author of Restoring the Lost Constitution.
Government, Bound or Unbound?
This paper is a sequel of an article I wrote twenty years ago that I now think can be put more tightly and clearly. That early paper was born of the irritation I felt, and continue to feel, at much of the classical liberal discourse about limited government. At least since Locke, that discourse sets out a normative ideal of government: the protector of “rights” its citizens are in some fashion endowed with, and the guarantor of liberty that ranks above rival values. Such government uses coercion only to enforce the rules of just conduct. This ideal is attractive enough to the liberal mind. The reason why it nevertheless irritates is that it makes it seem that the writing of a constitution of liberty is a plausible means for transforming the normative ideal into positive reality. The message is that “we” can have limited government in the above sense if only “we” understand why we ought to wish it. The “we” is crucial, for it suppresses the essence of collective choice. Collective choice starts where unanimity ends, and involves some deciding for all, where the “some” control the apparatus of government. It is the potential for some to benefit morally and materially at the expense of others that creates the bone of contention and that limits on government are meant to move out of reach. It is odd that little or no awareness is shown of the “incentive-incompatibility” (if we may use ugly but handy jargon) of limits that would exert real rather than illusory restraint.
Similar confusion between “ought” and “is” is inherent in another major strand of political thought centered on the idea of the fictitious social contract. The contractors give the government a limited mandate to help execute and enforce the contract. There is an obvious potential gain to the government or, to be pedantic, the persons in charge of it, from exceeding this mandate and the means are available for doing so. The incentive-incompatibility of the limits upon the government is nevertheless ignored and not dealt with in mainstream theory.
When Ulysses was sailing close to the sirens, he had his shipmates tie him to the mast lest he should be lured to jeopardy by the sirens’ song. This metaphor is used to bring home the rationally self-interested nature of self-imposed restraint. However, the metaphor is an ill-fitting one for governmental self-restraint. Ulysses obviously would not tie his own knots, for he would know that he could and would untie them again when temptation beckoned. He had shipmates; it is not evident that government has any capable to tie it to the mast. If there are any, they might be just as eager to untie him and to yield to the temptation as was Ulysses himself. For the metaphor to work, some explanation is needed why their incentives differed from those of Ulysses, why Ulysses took on such uncongenial shipmates and why, being of sterner stuff than their weak-willed skipper, they did not take over the ship rather than leave him in command.
A different metaphor I proposed in my The State is a perhaps more apt illustration of the use of a mechanical device to serve as a substitute for reliable commitment to self-restraint. A lady accepts to wear a chastity belt to reassure her lord during his prolonged absence from home. (A government may likewise adopt constitutional limits to gain the confidence of its subjects). However, the key to the belt’s padlock is within reach, and thus the belt can occasion delay, but cannot stop Nature from ultimately having its way. A padlock whose key has been thrown away is a metaphor for a constitution that cannot legally be amended — a problematical legal rule I intend to touch upon in Section I.3. Meanwhile, we must not forget that if there is no key, there is always the locksmith.
My early paper on the subject concluded, if that is the right word, that the possibility of limited government lies beyond the scope of rational choice theory. I still think that there is something to be said for this view, but that the argument leading to it should be formulated somewhat differently and before winding it up more account must be taken of real-life contingencies that may or may not occur and persist.
My present argument will be set out in what I hope to be a tolerably organised pattern of nutshells. Section 1 will deal with rule-bound social orders, 1.1 sketching the conventional rule system of ordered anarchy, 1.2 the rule system made for and by government, 1.3 considering some problems raised by the nature of vows, self-referring rules, and enforcement, and 1.4 some consequences of a winning coalition seeking both to maintain itself and maximize the benefit from winning. Section II is mainly devoted to contingencies, 2.1 speculates about what happens when money buys elections, 2.2 points to limits of government arising from taxable capacity, 2.3 deals with how panic about a dysfunctional spread of government may bring about a reversal of the usual time preference for the present over the future, while 2.4 evokes taboos as factors that may limit government in ways the usual conception of rational choice would not do.
1. Rule-Bound Conduct
Social coexistence may be chaotic or rule-bound. Here I am only seeking to deal with the latter. Rule systems can be fruitfully divided into two types, conventional rules and rules by and for government.
1.1. Conventional Rules of Ordered Anarchy
Conventional rules can be best understood in game-theoretic terms. They are equilibria of coordinated behavior that are payoff-enhancing (without necessarily being payoff-maximizing) for those who adopt the behavior in question provided enough others adopt it, too. Standard examples include the use of a common language, the rule of the road that drivers will adhere to if many travel on the same road, or the orderly passage of two persons through a narrow door where if one chooses “after you” and the other chooses “before you.”
These are examples of equilibria that are self-enforcing like all equilibria. However, most of the conventional rules of coordinated behavior that have the greatest significance for the social order are equilibria only because deviation from them by one individual provokes sufficient probability of the deviant being punished by adjacent individuals, so that the probability-weighted payoff from deviation is lower than that from adherence to the convention. Formally, some or all of the “players” pursue a contingent “strategy” that kicks in to respond to another’s harmful deviation and sanctions it by one of a variety of more or less heavy punishments. The best examples relate to property and contract. Here, the deviant strategy of trespass, theft, usurpation, and default would yield vastly higher payoffs than respect for property and fulfilment of contracts, were it not for an adequate probability of sanctions. Administering a sanction involves some cost, but the conventions of property and contract function as equilibria no one can expect profitably to deviate from if a sufficient proportion of “players” deem it that the strengthening of the convention due to their own action in administering punishment is worth more to them than the cost of doing so. Bearing the cost of punishing deviation is a classic public goods problem. The public good is the convention. Not punishing the deviation when one does not know whether enough others are going to do so augments the risk of weakening the convention. There is an incentive to diminish the risk by assuming the tasks of punishment.
In the Hobbesian tradition of political thought, the likelihood that conventions of property and contract will spontaneously emerge and be protected by the voluntary defensive action of those benefiting from the conventions is never envisaged, and the task is entrusted to Leviathan, despite ample evidence that such conventions have since time immemorial been deeply anchored in people’s consciousness and conduct. Hume, I believe, was the first to recognise that conventions, including those regarding property and the keeping of reciprocal promises (i.e. contracts), exist and are the outcome of spontaneous rational conduct. He implicitly but clearly scotches the Hobbesian idea of a need for Leviathan when he says “…the stability of possession, its translation by consent and the performance of promises. These are…antecedent to government.” 
The complete set of conventional rules banning torts against life, limb and property, nuisances, and incivilities is neither imposed nor sponsored by authority. Nor is it the outcome of bargaining. It constitutes ordered anarchy. There are plausible explanations why ordered anarchy, despite its moral attraction and its nature as an equilibrium, does not subsist through history, but is overlaid by a different rule system involving government. Surveying these explanations is outside the purpose of my paper. However, the concept of ordered anarchy is a standard of reference that must always serve as the background in considerations of the nature and role of government.
1.2. The Rule System by and for Government, and the Rule of Submission
In a complete rule-bound system, every rule except at least one is the product of a rule. There must be at least one that is not rule-made, for if there were none, there could be no first rule, hence there could be no rule. The exception must be the product of something outside the rule-bound system and once created by that thing, can in its turn create rule-made rules. We shall call it the rule of rule-making (which includes rule-change).
The origin of the rule of rule-making may be divine command, moral authority, material power, or the unanimous will of all concerned by it and its consequences. What it is or what it is believed to be is an important question for its legitimacy, but not strictly relevant to our purpose. What matters here is that it is a valid rule if it functions to make rules that turn out to be binding.
The rule of rule-making must define the person or persons, for short the government, entitled to make rules and the conditions it must fulfill in doing so. For instance, it may lay down that government is carried out by the king, that he must be anointed and crowned, and the rules he makes must be decided by him in his council. The general form of the rules is to say what may, shall, or shall not be done by whom. Accordingly, it may be addressed to individuals, or to the government itself. The latter type is a collective choice rule (in the literature inspired by the work of Kenneth Arrow it is called, perhaps a little suggestively, a “social choice rule”), or constitution.
It is apparent that in laying down a constitution, the rule of rule-making refers to itself, which would vitiate its logic and make rule-bound constitution-making nonsensical. However, as it refers to other things as well, it is only partially self-referring and is saved from being nonsensical. This difficulty will be briefly faced, though not really resolved, in 1.3.
A necessary complement of the rule of rule-making is the rule of submission which requires that all shall obey the rules, including this rule, regardless of whether they approve or disapprove of them. The enforcement problem of the rule-bound rule system impinges entirely on this rule.
The crucial aspect of the rule of rule-making seems to me the frontier it draws between the “zones” of individual and collective choice. There is a zone of the feasible universe where choices are reserved for individuals and another where power is given to collective choice to override individual choices. To the extent that the collective choice rule can define or by a rule-change amend the frontier, its zone may encroach on the zone of individual choices, while the reverse is of course not the case; individuals have no rule-making power enabling them to encroach on the collective zone. Much of the problem of limited government is summed up by this sentence.
What follows immediately below is a leap from the wholly abstract to the mundane and almost comic. As far as I am aware, no constitution at present in force imposes on the government a limit to taxation. Collective choice, in other words, is not restrained by its rules from encroaching on individual choice in the matter of pre-empting material resources. Germany’s post-war constitution is no exception. However, its Article 14 guarantees the ownership of property (though it is not made clear against what, and whether income qualifies for the guarantee). The article adds (gratuitously, it seems, for a document that should lay down what shall be done) that private property also serves the common weal. The presiding judge of one of the two chambers of the Constitutional Court chose to interpret Article 14 to mean that half of a person’s owned resources may be taken from him to serve the common weal, which in turn implied that taxation of all kinds must not exceed 50 per cent of anyone’s resources. The other chamber did not support this interpretation and the ensuing debate among constitutional lawyers about the “Half-and-Half Principle” seems now to be petering out.
Equally quaint and droll, but in a way also rather ominous, is a remark Hayek makes about taxation in one of his essays, quoted verbatim in my 1989 article “Is Limited Government Possible”. The gist of Hayek‘s astonishing statement is that while government may use coercion to enforce the rules of just conduct, it may also provide many useful services that do not involve “coercion except for raising the necessary means.” Is one to take it that the usefulness of the services it renders is a warrant for the government to “raise the means”? If this were a clause in a constitution, government would only be limited by physical feasibility, for its useful services are potentially no doubt unlimited.
1.3. Self-Referring Rules and Inseparable “Powers”
It is difficult to quarrel with John Austin’s view that every legal rule must be backed by a legal rule sanctioning the breach of the rule, though one may argue that the sanction need not always be a material one. However, the requirement of sanction by some punishment creates a logical difficulty. If the initial rule is breached, the sanctioning rule orders punishment, but if that rule is also breached, it must order to sanction itself for its own breach. Such self-reference is nonsensical. To avoid it, there must be a further rule ordering to sanction a breach of the sanctioning rule, and so on in an infinite regress.
In a magisterial essay, Herbert Hart reviews Hans Kelsen’s criticism of Austin. Though Hart with characteristic courtesy omits to say so, Kelsen’s solution seems to be to call the infinite regress to a stop, which is clearly one way of resolving the mater. Hart argues that the logical defect of self-reference can be overcome if the rule refers to itself and also to another rule, i.e., if it is only “partly self-referring.” He shows that Article V of the American constitution and other rules of the same structure refer to themselves but to other rules as well, and on this ground he refutes Alf Ross’s widely remarked attack on such clauses in his Law and Justice.
It is probably unwise to fault Hart on logic and the present author intends to do nothing of the kind. However, while admitting that partly self-referring rules are technically well-formed, they may still leave some unease. Hart himself cites the example of a South African constitutional clause that was impeccably “entrenched” by invoking itself and another clause, and that successfully withstood challenge in the courts, but was got round by the government. One might say that the clause, like the chastity belt, merely occasioned delay before Nature took its course.
It is also the case that quite momentous changes in rules can be effected in ways that many consider breaches of the spirit if not of the letter of the constitution, but that have no recourse to the rule-changing rule. The post-war evolution of American constitutional law at the hands of the Warren Court is an example.
However, the fundamental problem of any structure of a rule of rule-making is not its logico-juridical impregnability, but the role of power in enforcing the rule of submission. If the rule of rule-making states that the king shall not make a certain type of rule and the king breaches that rule, how does the king enforce the rule of submission against himself? He may, of course, submit voluntarily, contrite at his own offence and withdraw the offending rule. (The same voluntary submission may be shown by ordinary subjects to rules demanding their obedience). But if this is not the case, ultimate recourse to force must be known to be possible, however distant and rare actual violence may be. The potential for violence is under the king’s control; the state is supposed to have a monopoly of it. If so, we are reduced to the entirely and purely self-referring reality that the king enforces the king’s obedience to his own rule.
One of the dangerously misleading phrases in this context that has penetrated political thought is the “separation of powers.” It is dangerous because it tacitly suggests that such separation can resolve the paradoxical feature of every constitution which the king enforces against himself (or a government against the mandate of its own majority). Montesquieu uses words that do not illuminate the distinction between separate functions of a government and separate repositories of power under separate control that may act independently of one another or even against each other. The latter kind of separation of what ultimately boils down to armed formations and firepower is difficult to conceive of within a single government. It is fairly obvious that Montesquieu did not mean it, and if we mean it when we use the phrase, it is that we do not really think of what the words could mean. The result is a blind belief that the separation of functions among legislature, executive, and judiciary contains within itself a solution to the constitutional paradox of real, though perhaps not logico-legal, self-reference.
1.4. Maximization and the Size of Coalitions
The person or persons seeking control of the government, and retention of control once gained, must generally form coalitions to achieve this. This is true even of ostensible one-man rule, where the absolute monarch or dictator must rely on concentric circles of supporters, from the innermost circle of the most committed and most highly rewarded to the outermost one of consenting masses. It is more explicitly true of governments that can only gain control by fulfilling some formal requirement such as ballot-counting giving them simple or qualified majority support. Let us call the government and its supporters the “winning coalition.” It is formed in an auction where rival bidders make election promises to attract the desired number of supporters.
In very plain terms, a government must reconcile two objectives that are diametrically opposed. One is to maximize the total of all gains, religious and lay, moral and material, cultural and economic, that it can obtain for itself and remunerate its supporters at the cost of the losing coalition. The larger and richer the losing coalition, the greater is the loss that can potentially be imposed upon it. The obvious corollary is that the smaller is the winning coalition, the larger is its potential gain both in absolute total and per head.
No less obviously, the more the winning coalition is reduced in size to maximize its gain, the greater is the probability that it will fail to get control of the government or lose it even upon some minor shift in public attitudes. The safe dose of support is in excess of that just necessary for gaining and retaining power. To maximize the excess is to minimize the gain, and of course vice versa.
There has been an irregular, often interrupted and reversed, movement throughout medieval and modern history from smaller to larger and from informal to formally defined winning coalitions. From the conquering war band and its leader we have moved to a looser feudal structure, to absolute monarchy, to constitutional monarchy, representative government (either unelected or elected on a restricted franchise), and finally to simple majority rule and universal suffrage with constitutional limits or with absolute sovereignty. The latter may well be a rule-of-thumb approximation of some optimum compromise between the two contradictory objectives of maximum gain for the winning coalition and maximum security of its tenure. With a touch of good-natured irony, we might say that if this is the optimum combination, it is the “end of history.”
2. Contingent Limits of Government
The interim conclusion that might be drawn from Section I is that self-imposed rules attempting to limit the scope of collective choices, such as constitutions, are not strong and though they may be observed if they are innocuous and only forbid government to do what it is not strongly interested in doing, they could hardly be expected to restrain government from doing what it is anxious to do or must do to preserve its tenure of power. The general absence from constitutions of restrictions of taxation lends some verisimilitude to this conclusion, though it would still have to be regarded as tentative.
However, circumstances and events may occur that are contingent, not constant and integral features of the state of affairs but sufficiently frequent to be reckoned with. They do seem to place limits on collective choice when they occur.
2.1 Campaign Finance as a Limit of Government
There is an incomplete, partial indicator of the extent to which collective choice overrules individual choice, namely the share of central and local government spending (including expenditure by compulsory social insurance schemes) in GDP. It is the best quantitative measure for the good reason that it is the only one we have.
It turns out to be the case that in some European countries such as Scandinavia and France this share is just under or just above 55 percent, in others in the mid- to high 40s, while in the United States it is in the mid-30s. Popular wisdom has it that this large difference is due to European nations being left-leaning and falling in readily with collectivist policies, while the American people are rugged individualists, preferring opportunity to security and mistrusting big government. There is perhaps a little truth in this belief, but such as it is, it is probably getting less true as time passes. It might be interesting to look at a less heroic hypothesis.
Let us suppose that campaign expenditure has a significant probabilistic effect on election results. In Europe, campaign finance is in many countries provided more to parties than to individual candidates, and is provided more or less even-handedly to each party out of general taxation. A party will make campaign promises that may succeed in recruiting enough votes to form the winning coalition. Its promises and subsequent policies are directed at forming and maintaining the winning coalition and have no or scant influence on how much campaign finance it will obtain.
In the United States, it is still largely individuals and not parties that get elected. Party discipline is loose compared to Europe and candidates raise their campaign expenditure to a large extent by personal effort for their personal purposes. To the extent that campaign donations are sought from higher income donors, a candidate’s program must be more “conservative” and less redistributive than if donations came from all income groups in proportion to their income. If elected, a legislator has both a debt of honor to pay to his high-income donors and must establish a record that will help him gather donations on future occasions if there are any such.
This structural difference in campaign finance and the allegiance of legislators between Europe and America may or may not be the real cause of the more limited pre-emption of GDP for collective purposes in the United States than in Europe, but it is hard to think of a more likely or much stronger cause.
2.2. Taxable Capacity
The maximum gain a winning coalition derives from winning depends solely on the size and wealth or income of the losing coalition if, but only if, the proportion of the losing coalition’s wealth or income extracted from it to the benefit of the winners is a constant.
Obviously, this may but need not be the case. The tax rates the winners choose may be higher or lower depending on what they think the total tax yield will be at various rates. They may not choose to impose rates that produce the maximum yield because of the adverse effect this may have on the level of support the winning coalition needs to retain its tenure with some margin of safety.
However, a further limitation is liable to arise. Tax rates that fall short of maximizing the immediate tax yield may yet be too high to maximise the discounted present value of the multi-year tax yield over the expected tenure of the winning coalition. The reason is that rising taxes trigger two streams of exit: a “brain drain” typically composed of the most enterprising, ablest, and best-trained members of society, as well as a flight of capital in the form of money, and of going concerns that “de-localize” to low-tax jurisdictions.
Tolerating the brain drain and the capital flight reduces the present value of the expected tax yield. Not tolerating it, but imposing emigration restrictions and harsh controls on capital movements also reduces it, and probably more drastically, too. For restrictions of a moderate sort would very likely accelerate the brain drain and the capital flight as those concerned would want to flee before escape routes are closed. Really strict controls severely enforced, on the other hand, would be liable to transform the country to a replica of pre-1989 East Germany, with the disastrous consequences that are well known and among which impoverishment is not the greatest. Modern governments have in the last decade generally taken the opposite line of defense, reducing the corporate tax rate and moderating the progressivity of personal taxation.
There is, then, in modern economies, a taxable capacity that governments are well advised to respect, which is lower than the physically feasible one and also lower than the one that would maximize the immediate tax yield. When modern economies in fact react as sketched under the present heading, taxable capacity that seems sub-optimal in the short run but is probably optimal in the longer run, does seem to constitute a limit a government may rationally choose to observe as a drinking man might limit his daily intake of whisky in order to preserve his liver.
Government in Great Britain from 1945 to 1979 was alternately controlled by Labour, the Conservatives and then again by Labour. From the perspective of three decades later, the government can be seen as left-leaning to a greater or lesser extent. Three main features characterize the policy of this epoch. The first was the development of the welfare state, particularly the free health service, as well as the liquidation of the pre-war education system of selective schools and its replacement by a unified non-selective system. The second feature was the helping hand extended to the labor unions in their ascendancy, the securing of their legal immunity and the complete lack of controls over picketing. Labor unions were treated as a second-tier government with influence on policy that bordered on veto rights. The third defining feature of post-war British policy was budgetary softness that greatly contributed to chronic weakness of the external accounts, a spectacular decline of the pound sterling, and humiliating recourse to the IMF.
The winning coalition, regardless of periodic shifts in its composition from Labour to Tory and back to Labour, gave the impression of helpless drift, maintaining itself by developing ever more elaborate welfare entitlements. It consistently responded to strikes in the public sector by capitulating, which led to the recognition that strikes bring easy glory to union hierarchies, and that of course bred more strikes. Meanwhile, the country’s financial outlook was becoming truly alarming.
By 1979, the electorate had passed through the phases of egalitarian enthusiasm, complacency, dissatisfaction, and disquiet about the symptoms of decline and disorder. It had reached a state of virtual panic about the future.
The normal state of mind of a typical electorate is to discount the future at a high and apparently higher rate than do its individual members. In its role as collective decision-maker, the wining coalition fairly consistently favors more public goods and services paid for at the margin by public dissaving, i.e. a fairly chronic budget deficit (whereas individual members of the coalition save).
The 1979 election victory of Margaret Thatcher, who in the popular imagination embodied austerity, welfare cuts, budgetary discipline, and “union-bashing” (though this image was in large part kitsch and fabrication) was certainly contrary to the sort of result one would expect from an electorate apparently addicted to a constant expansion of welfare entitlements and redistribution. It can be analytically explained by a reversal of the usual strong collective preference for the present over the future. It was as if instead of applying a discount on future goods, the collective political will turned around and applied a premium. This may be the rational reaction to a drastic, panicky lowering of the expected stream of future goods, which in turn is consistent with a sense of panic about order unraveling and a bleak and poor future becoming a real threat. (It is not absurd to suppose that a similar, though much milder, panic was partly responsible for the replacement of Jimmy Carter by Ronald Reagan in 1980 and the French electorate’s turning its back on 26 years of the equally welfarist and equally soft Mitterrand and Chirac presidencies in 2007).
Panic, then, may be the limit a government inadvertently runs into when it expands recklessly, yields promptly to blackmail, and shows weakness before partial interests.
2.4. Beyond Interest
Individual choices obey conventional rules that arise spontaneously and are self-enforcing. They also obey collective choices which are enforced upon them. Collective choice involves an exogenous rule-making rule which collective choice itself may endogenously amend over the course of history to suit the maximizing conduct of winning coalitions. Formally, such adaptation need not involve a breach of the rule-making rule thanks to its self-referring nature. Metaphorically, the lady holds the key to her own chastity belt. Thus, collective choice is as good as omnipotent, potentially antagonistic to individual choice and dominating it within rules of its own making.
Yet it is a truism that collective choice is in some manner composed of individual choices. No matter how indirect and involved the manner in which the individual will is transmitted to the collective one, it is the minds of persons that ultimately decide what will be chosen.
If we steer clear of the concepts of utility and preference as irredeemably tautological, having no meaning apart from the choice they are claimed to inspire, we are left with a simple account of human motivation that has the merit of having a descriptive content other than as the description of a choice.
Human motivation, then, is twofold, identifiable interest and everything else or mixtures of the two. The present paper has throughout been running in terms of identifiable interest and the choices such interest would help to explain. Limits on government were examined in the light of their “incentive-compatibility.” As a last stage in the argument, it is now necessary to look at the “everything else” that is not interest, and in particular to its element that is basic to political philosophy, unreasoning conduct according to standards.
Standards differ from rules because we follow rules at least in part because of their consequences and the consequences of breaching them. Calculus plays its part and even if rule-obedience has become a habit, the habit was first formed under the influence of calculus. Standards may have consequences, but if we follow them, it is not because we reason about them. We do it reflexively. However, whether we follow standards, and which ones, is a purely contingent fact of the social state of affairs; there are possible worlds where every human choice is motivated by reasoned interest and nobody observes any standard, though the idea of such a world might give not be a reassuring one.
Unreasoning, even plainly unreasonable standards can effectively limit government if they are widely followed. For about a century and a half before Keynes’s General Theory became common currency for the literate and the semi-literate, it was widely believed that repeated deficits in the state household were mortally dangerous, liable to lead to the country’s ruin and to be countenanced only in desperate circumstances. Balancing expenditure and revenue was an unreasoned standard that did to a large extent tie the hands of governments. Now, of course, deficits are not believed to act as magic poisons, and they are decided by the interplay of interests.
Perhaps the purest and strongest type of limit on government is the standard, non-interest motive arising from superstition and taboo. To say so is not to denigrate such standards. Nor is it meant to belittle religious ethics or a lay moral code. But it expresses the apprehension that religion and lay morals may not be sufficiently impervious to utilitarian enlightenment, the reasoning that is driven by interest.
 Jasay, A. de, “Is Limited Government Possible?” Critical Review, 1989, Vol.3, No.2, repr. in Radnitzky, G. and H.Bouillon, eds., Government: Servant or Master?,1993, Amsterdam and Atlanta, Rodopi, repr. In Jasay, A. de, Against Politics, 1997, London, Routledge.
 Hume, D., A Treatise On Human Nature, 2nd ed., 1749/1978. Oxford, OUP. P.541.
 In Hayek, F.A., New Studies in Philosophy, Economics and the History of Ideas, 1978. Chicago, Univ. of Chicago Press, p.144.
 H.L.A. Hart, Self-Referring Laws, in Hart, Essays in Jurisprudence 1983, Oxford, OUP.
Our Moral Sense and the Extensive State
Anthony de Jasay is correct: the apparent failure of constitutional provisions to effectively constrain the state within anything close to the bounds that classical liberals endorse must lead them to rethink their analysis of constitutional constraints. And surely de Jasay is right that one fundamental problem is that the interests of the government and its supporters are advanced by expansion of the state’s activities, and in the face of these interests, constraining constitutional provisions tend to be inadequate. Throughout, de Jasay’s focus is on the “incentive-incompatibility” of constitutional constraints and their policing: the interests of government and its supporters run directly against respecting these limits. As he sees it, this shows the limits of “rational choice” theory as a basis for constraining government. To the extent that we understand political actors and citizens as overwhelmingly self-interested, all this strikes me as quite right.
But are interests the whole story? Or even the only part of the story worth paying attention to? At the close of his essay de Jasay turns to “taboos as factors that may limit government in ways the usual conception of rational choice would not do.” The idea of constraints on political action that are not based on interests is, I think far more important and profound than de Jasay realizes: it points to a deeper, and more worrying, reason why the modern democratic state is unbound by the classical liberal’s understanding of the proper limits of government.
“Rule systems,” de Jasay writes, “can be fruitfully divided into two types, conventional rules and rules by and for government.” I think this dichotomy leads de Jasay astray because it leads him to ignore the importance of distinctively moral rules. There is overwhelming evidence that a division of rules into the conventional and the political is too simple: cognitive psychologists have shown that even young children distinguish conventional/prudential rules from moral rules. Laurence Fiddick and others have found evidence that tasks involving social rules related to the “social contract” — such as whether it is permissible to pull other children’s hair — are processed in different parts of the brain than prudential rules that instruct us to avoid dangerous situations. Children recognize that conventional rules can be relative to time and place, and may be put aside in some circumstances, whereas moral rules are held to be categorical (Fiddick, 2006; Nichols, 2005: 171ff). It is probably true that the roots of moral rules lie in the importance of “strong reciprocity” — reflected in cooperative norms whose observance does not depend on iterated interactions — for social life (Gintis, et. al. 2005), but genetic and cultural evolution has proceeded to the point where acceptance of such rules and norms may be considered part of our moral sense.
Now what is really important is that, in contrast to merely conventional rules, moral rules are not subject to being overridden by authority. Even children recognize that an authority figure such as a teacher may legitimately make a rule canceling out a purely conventional rule, but they do not accept that authority can override or cancel moral rules (Joyce, 2007: 136). This is of the first importance. Suppose we accept de Jasay’s assumption that “the concept of ordered anarchy is a standard of reference that must always serve as the background in considerations of the nature and role of government.” If we take seriously the idea of ordered anarchy for humans as the background, it is important to be clear about the nature of actual ordered human anarchy. The mass of recent evidence from evolutionary biologists, cognitive psychologists, and sociologists is that human ordered anarchy is structured not simply by “conventional rules banning torts against life, limb and property, nuisances and incivilities” but by moral rules (or norms). Certainly moral rules include various prohibitions against harming others and some types of deception. Although there is dispute about this, I think there is also considerable evidence that these moral rules include some standards of fair distribution. The norms that enabled human groups to survive and thrive during most of our evolutionary history were not simply coordination rules, but also norms about the fair sharing of goods. As Cristina Bicchieri (2006: ch. 3) has shown, fairness norms are fundamental to social life and we now have a deep “taste for fairness.”
Given all this, if we follow de Jasay and think of the rules of ordered anarchy as the background against which we measure the rules of government, the evidence is that the subjects of authority will accept the legitimacy of government-made rules overriding conventional rules, but they will resist government-made rules that override moral rules. We now see the deep problem for the classical liberal project of holding back the state. If the rules that are fundamental, according to classical liberals, are merely conventional, then citizens will see them revisable by authority. The legitimacy of democratic authority and its laws will override the authority of the conventional rules classical liberals so stress. We do not need an account of how the interests of the state cannot be constrained: it is the weakness of conventional rules that is the real culprit. Of course, if the basic normative commitments of classical liberals were widely conceived of as moral rules, then there would be much deeper resistance to government-made rules that seek to cancel or override them. The problem is that the opposite seems nearer the truth: for many citizens, their understanding of the moral norms related to fairness endorses government-made rules overriding the conventional rules of property. The welfare state reigns supreme not because the state and it allies have tricked the rest of us in a power grab; it reigns supreme because in the eyes of most citizens it conforms to the egalitarian fairness norms that have evolved with humans (Fong, Bowles, and Gintis, 2005). Classical liberals who convince themselves that the New Deal is best explained as a power grab by Roosevelt and his allies are manifestly deluded: it was (and still is) very widely seen as demanded by our sense of fairness.
When states do seek to make rules that clearly violate the moral consciousness of the majority of citizens, the state is much more effectively limited. Even in Louisiana, stealing by the government is not usually tolerated (of course some libertarians will say that taxation is stealing, but this just goes to show how far their moral judgments are from the norm). The recent attempts of the U.S. federal government to make new rules that allow torture have run up against the same limits. It is not so much that government can do whatever it wants, but that the moral views of the majority often endorse its expansion in ways that classical liberals think is wrong and dangerous.
Judging from the last section of his essay, I suspect that de Jasay might reply that this “lay moral code” is based on a “non-interest motive arising from superstition.” To describe it thus, de Jasay adds, is not meant to “belittle” it, but to express “apprehension that religion and lay morals may not be sufficiently impervious to utilitarian enlightenment, the reasoning that is driven by interest.” But the claim that reason operates only on interest seems mistaken, and has been undermined by recent cognitive psychology and experimental economics. Our sense of fairness is as much part of our utility function as is our aim for wealth or other goods (Bolton, 1991); there are no good grounds for equating rational choice, or rational choice theory, with interest-promoting action or choices, and plenty of reasons not to (Gaus, 2007: 24-26, 50-56). Moreover, without a moral sense it is dubious that interest-promoting schemes of cooperation will be stable; indeed, there is reason to think that social groups in which people sacrifice their interests for others may sustain higher levels of cooperation than groups in which each, even over the long-term, maximizes his own interests (Sober and Wilson, 1998).
Now although some would love to do so, we should not draw from this the conclusion that statists and their supporters are on the side of morality while classical liberals are against it. Rather, the real crux of the problem is how to apply our evolved moral norms — or, more broadly, sentiments — to a complex environment in which they did not evolve. Looking at the basis for cooperation under anarchy, I suspect, will only lead us astray, for what we know about actual human existence under anarchic conditions suggests that egalitarianism of some sort is apt to arise.
Our question is the basis for cooperation in far-flung impersonal economic and social orders that have arisen under the modern state. We cannot simply dismiss our moral sense as atavistic, any more than we dismiss our taste for sweets because it evolved to help us focus on calorie-rich food — something we used to need, but which for many in advanced economies is now a dangerous taste. We do, though, need to use our intelligence in determining where and how to employ our moral sentiments (just as we must use it when deciding when to eat sweets). As Hayek often stressed, classical liberals have the difficult task of trying to show how the conditions of a Great Society change the moral landscape. Some apparently obvious applications of our moral concepts — such a treating a far-flung economic order in which each must have an incentive to find his place as if it was a tribe in which the hunt must be fairly shared — are misguided and end up violating other moral notions about freedom and fairness to individuals. The debate is complex, concerning both empirical and moral issues. Few proponents of classical liberalism are willing to engage the debate on these complex grounds (my colleague David Schmidtz is a notable exception), preferring instead to ignore our complex pluralistic moral sentiments by building their case only on self-interest, or retreating to a narrow “natural rights theory” of morality shared by few. It is no wonder that classical liberals are losing the debate about the limits of the justified state. The state grows to a large extent because most citizens think that fair dealing, as well as the protection of everyone’s basic interests, requires it. Until they are willing to engage the moral sense of their fellows, classical liberals worried about the unbound state should look no further then their own failure to convince the vast majority of their fellow citizens that morality does not endorse it.
Bicchieri, Cristina. 2006. The Grammer of Society: The Nature ad Dynamics of Social Norms. Cambridge: Cambridge University Press.
Bolton, Gary E. 1991. “A Comparative Model of Bargaining: Theory and Evidence,” The American Economic Review, vol. 8: 1096-1136.
Fiddick, Laurence. 2006. “Adaptive Domains of Deontic Reasoning,” Philosophical Explorations, vol. 9 (March): 105-116.
Fong, Christina M., Samuel Bowles and Herbert Gintis. 2005. “Reciprocity and the Welfare State” in Gintis et. al. eds., Moral Sentiments and Material Interests (Cambridge, MA: MIT Press): 277-302.
Gaus, Gerald F. 2007. On Philosophy, Politics, and Economics. Belmont, CA: Wadsworth.
Gintis, Herbert, Samuel Bowles, Robert Boyd, and Ernst Fehr. 2005. “Moral Sentiments and Material Interests” in Gintis et. al. eds., Moral Sentiments and Material Interests (Cambridge, MA: MIT Press): 3-39.
Joyce, Richard. 2007. The Evolution of Morality. Cambridge, MA: MIT Press.
Nichols, Shaun. 2004. Sentimental Rules. New York: Oxford University Press.
Sober, Elliot and David Sloan Wilson. 1998. Unto Others: The Evolution of Psychology and Unselfish Behavior. Cambridge, MA: Harvard University Press.
Can an Omnipotent Government Make a Rock Bigger Than It Can Lift?
Anthony de Jasay uses the evocative metaphor of Ulysses bound to the mast, restrained by knots beyond his reach, and secured by his admonition to the crew to ignore his pleading. That’s the paradox of Ulysses’ command: “You must obey the following order: Disobey me when I order you to release me.” I found it strange, however, when de Jasay complains that “little or no awareness is shown of the ‘incentive-incompatibility’ of limits that would exert real rather than illusory restraint.” Really? I would have said that consideration is at the very heart of modern public choice theory.
The example of Ulysses/Odysseus is important, because it demonstrates just how complex the problem of commitment can be. Suppose the foremost rule of behavior is this: Obey the ruler. Suppose further that the ruler has no other constraints on his behavior. Would a self-interested ruler accept this situation? He would not, if he could help it. A self-interested ruler wants, in fact needs, the power to impose limits.
The first thing Ulysses does is bind himself, not to the mast but to a commitment to reward disobedience. More specifically, he gives up a significant power (the power to have his commands obeyed) in order to make himself better off. He must create in his men the expectation that they can disobey the command, “Release me! Untie me!” without fear of the punishment that would surely follow any other disobedience.
This incentive-compatibility of giving up power has been documented often, in the work of Robert Bates, Jack Knight, Douglass North, Barry Weingast, and others. Consider: Why was the English government able to borrow freely, financing huge capital expenditures on army, navy, and infrastructure while the French government was always cash-strapped? Paradoxically, the problem was that the French government was too… powerful! The French king could not order his subjects to disobey.
The English king had had power stripped away in two major stages. The first was the signing, under duress, of the series of documents (between 1215 and 1295 A.D.) called “Magna Carta.” These limited the power of the king, providing property and due process rights to the nobles. The second step was the reforms forced through by the remarkable person of Sir Edward Coke. Coke invoked Magna Carta, but in fact succeeded in making entirely novel claims that restricted the power of the king more than ever before. In 1628, Coke made the fundamental claim of English Whiggery: “Magna Carta is such a fellow, that he will have no sovereign.” After the second stage, the power of the king was limited by separation of powers, checked by the veto of the House of Lords.
How could the comparative weakness of the English king be a strength? North and Weingast (1989) document the point at length, but it can be summarized briefly: the English king, and therefore the government, could borrow money at reasonable rates from private wealth-holders. And private wealth-holders would voluntarily offer that money, and those rates, because the government had to pay the money back. The Sirens’ song in this case was debt default. If the king can renege without consequence, private wealth-holders disguise their wealth and withhold their cooperation.
And that is how the French government suffered the weakness of its strength. That weakness suggested the title of my essay: An omnipotent king cannot make a rock so big it can’t be lifted. With no Magna Carta to guarantee due process rights and protect property, nobles jealously guarded their wealth. No loans were available, and few nobles trusted the king enough to provide troops. With no House of Lords to veto regal decrees, the king could make no credible commitments. An all-powerful king can lift any rock, or legal impediment, no matter how heavy.
Knowing this, potential loan sources insist on usurious interest rates, or simply disappear as wealth is disguised and hidden from expropriation. Investment shrinks, growth evaporates. The first time wet weather ruins the wheat crop, the peasantry march ominously toward Paris, carrying pitchforks and muskets.
What I have tried to establish is the obvious, and in fact well-known, incentive compatibility of limits on government and selfish governors. There are two other problems to consider, and space constraints require that I be brief in considering each. The first is the problem of limited government, not just limits on government, which has been my subject so far. After all, de Jasay makes a narrower claim than I have attributed to him: he said limited government, in the sense of extremely modest goals and powers, is inconsistent with the self-interest of governors. There is quite a distance between the question he raised, and the question I have tried to answer.
The second problem is the making of commitments, the making of credible commitments, even in a world where genuine limits on government are desired. Is there any way to get there from here? That is, as a matter of pure political physics, of engineering, is there a means of making rocks bigger than a creative, and motivated, monarch can find a way to lift? This is different from the ex ante problem I have discussed so far. This is the ex post problem Ulysses faced after he was bound. His struggles were so powerful, his strength so great, that he broke through the ropes binding him to the mast. Fortunately for Ulysses, two of his strongest men caught him, and bound him with unbreakable chains. Notice the sequence of events: Ulysses gives orders that he is to be restrained. He tries to break free. His men obey the previous command, ignoring the current command (“Let me go! They are so beauuuuuutiful!”), and thwart him.
Limited Government, Not Just Limits on Government
De Jasay correctly notes the importance of rules on making rules, and notes that it must be logically antecedent. But I believe that his dividing line between conventional constraints and formal rule constraints is artificial. Further, I would say that conventions are the most likely source for the “first rule of rule-making.” The problem faced by most nations, it seems to me, is the gradual elimination of the conventional belief in limited government, and the increasing sense of hubris animating experiments in governmental rationalism. Restrictions on the domain of proper governmental control are being swept aside, precisely because there is no conventional belief (e.g., “the government that governs best, governs least”) in a minimal state.
And de Jasay’s pessimism is most clear, and (I believe) most accurately expressed when he addresses “the frontier between the ‘zones’ of individual and collective choice.” When I teach undergraduate classes, I spend a long time on this problem, and am amazed that students have never thought about it before. Most of us are used to property rights of the conventional sort, where some things are mine, and some things are yours. Brothers draw imaginary lines in the middle of the station wagon’s back seat, and a quick darting hand across the line draws a punch on the arm, until Dad yells from the front seat, “Don’t make me stop this car!” We are all used to property, the line between what is mine and what is yours.
But de Jasay nails the missing concept beautifully: where is the dividing line, the frontier, between what is mine and what is ours? This line is often invisible, the frontier unguarded and open to trespassers and smugglers. As de Jasay puts it,
To the extent that the collective choice rule can define or by a rule-change amend the frontier, its zone may encroach on the zone of individual choices, while the reverse is of course not the case; individuals have no rule-making power enabling them to encroach on the collective zone.
All that could possibly stand in the way is a social convention, a sense that the line between what is mine and what is ours exists, is real, and is important. It is this conventional understanding of the individual that stands most in danger today.
A brief example is useful at this point. It is one I often use, and comes from my 2000 book, Analyzing Policy. Imagine there are five citizens in a town, three of whom like very much to swim. The other two do not swim, and do not value access to a swimming pool.
At a city council meeting (all five citizens!), a proposal is raised: Let us build a municipal swimming pool. It will be financed at a tax of 1/5 of the cost for each citizen. And all citizens will have equal access to the pool, at all times.
The non-swimming citizens protest bitterly. A pool is not a public good. In fact, since its attractive nuisance status makes building a fence imperative, exclusion is nearly costless: just lock the gate. Pools, argue the “drys,” should be Buchananesque “club goods.” (Buchanan, 1965). No reason the pool should be municipal, and financed out of a general tax.
The “wets” caucus, confused. They only want what is good for all; how could anyone oppose something as wonderful as a pool? Finally, they realize that the “drys” are serious, and propose a vote.
“A vote? A vote?” the “drys” gasp. “Votes are to decide the quantities of public goods to be provided. We can’t use a vote to decide whether something should be publicly provided! That is…that’s theft!”
A majority of the city council (the three “wets”) tells the “drys” they have to shut the heck up, and quit whining. The question is called. Debate is closed off, by majority vote. And the “Build a municipal pool” motion passes the city council, by a vote of 3-2.
What is most appalling about this state of affairs is how often it happens, and no one is appalled by it, or even really notices it. This, if I understand aright, is de Jasay’s point. Notice what happened: a decision about what is mine, and what is yours (do you want to join a private club, which will provide a pool to its members?) is transformed to a decision about the level of provision of a public good (We are going to build a pool; you are going to pay 1/n of the cost; now, how big should the pool be? You get to vote, so it is fair!)
The problem is that I never had a voice in the transformation, and it is a profound transformation indeed, that took the decision about the pool from the private realm, where I have clear and defined rights, to the public realm, where I have diffuse and changeable rights. This frontier, where trespass and smuggling are the sine qua non of modern democracy, is undefended. We are the guards, and we are asleep on duty.
How Would Limits Work?
The way the problem is usually posed, there is a dimension of power government exercises over the people. At one extreme is the total absence of government; at the other is utter domination. A government design must choose the “optimal” level of power, recognizing that too little power may result in chaos and external aggression, and too much power in enslavement and repression.
But such a statement misses a fundamental result of Enlightenment thought, the value of separation of powers. A useful analogy might be a decision to use nuclear weapons in case of an attack by some foreign power. Authorizing such an attack might be too much of a responsibility for any individual, so a set of protocols are put in place to ensure there is no accidental or malicious launch. In particular, three different individuals, each with a separate “key” or encrypted launch code, might be required to activate the weapons.
The point is that this is a very powerful “government,” in the sense that it could marshal weapons of nearly unimaginable destructive power. But it would have great difficulty actually using this power, because each of three quite different people, representing different bases of authority, are required to use them. Still, if the different representatives were all agreed, enormous power would be wielded.
The separation of powers principle is universal, though it is often misunderstood. Why is government so often inefficient, and fractious? Because conflict is built into any system that uses separation of powers to limit government. And separation of powers is not just statically limiting, but also dynamically so. Each actor empowered to veto government action must have the power to chain Ulysses up if he breaks the bonds that have held him until now.
The danger to limited government, the threat to the Montesquieuan system of checks and balances, comes from an unexpected source. “Good government” types, people who want to improve the “efficiency” of government, are termites eating away at the walls that protect us from tyranny. And enormous damage has been done, in just the ways that Anthony points out. But I am more hopeful than de Jasay, perhaps because I see the first light of recognition in a lot of citizens’ eyes. The last thing you want is an efficient government. Our only choices are a truly weak, but efficient, limited government, or else a powerful government prevented by strong ties from using most of its powers, most of the time.
Buchanan, James M. (1965) “An Economic Theory of Clubs.” Economica 32: 1-14.
Charles Louis de Secondat, Baron de Montesquieu, Complete Works, vol. 1 The Spirit of Laws .
Munger, Michael C. (2000) Analyzing Policy. New York: W.W. Norton.
North, Douglass, and Barry Weingast. (1989) “Constitutions and Commitment: The Evolution of Institutions Governing Public Choice in Seventeenth-Century.” Journal of Economic History. 49, 4: 803-832.
Is Limited Government Possible?
That which exists is possible. This simple observation complicates libertarian discussions of the possibility of limited government. On the one hand, the government of the United States is “limited” in the sense that it is not a totalitarian government that either claims or exercises the power to restrict all of human conduct. Even after the elimination of many of the constraints on federal and state powers contained in the original Constitution and the Fourteenth Amendment, some limits are still observed. Moreover, the Congress and the states have not attempted to exercise the vast degree of federal and state power that the Supreme Court would likely uphold. So, in this sense, limited government clearly exists and is therefore possible.
On the other hand, the government of the United States far exceeds the very limited powers that libertarians believe are legitimate. Anarchist and minimal-state libertarians alike agree that laws against the unjustified use of force as well as fraud can be legitimately enforced by an existing government, by which I mean that government officials are not acting improperly when they enforce such laws and citizens have a duty to obey, even if the government’s claimed monopoly on law enforcement, as well as its claimed power to tax, violates individual rights. (Analogously, there is nothing unjust about delivering the mail, even if the postal monopoly is a violation of the rights of those who, like Lysander Spooner’s American Letter Mail Company, are prevented from offering a competing service.) But the government of the United States claims and exercises far more power than any libertarian would consider just.
Libertarians aside, and perhaps more pertinent to this discussion, the U.S. government far exceeds the powers that the Founding generation itself would have thought to be just. After all, the U.S Constitution may exceed the libertarian limits upon government simply because its Framers may not have been trying to establish libertarian limits. No matter. To the extent their efforts to limit the power of government by means of a written constitution have failed to hold the line wherever they desired to place it, confidence that any line can be held is still undermined.
The practical problem of holding government to any predefined limits, whether libertarian or not, depends on the nature of the government one is trying to limit. Obviously, the ability to limit a monarch is qualitatively different than the ability to limit a representative democracy. The latter was the problem confronting the Framers. Indeed, James Madison called for a constitutional convention to revise the Articles of Confederation, in part, to rectify “the injustice of state laws” that violated “private rights”:
If the multiplicity and mutability of laws prove a want of wisdom, their injustice betrays a defect still more alarming: more alarming not merely because it is a greater evil in itself, but because it brings more into question the fundamental principle of republican Government, that the majority who rule in such Governments, are the safest Guardians both of public Good and of private rights.
Madison then explained why democratic rule by a majority is dangerous to private rights:
Place three individuals in a situation wherein the interest of each depends on the voice of the others, and give to two of them an interest opposed to the rights of the third? Will the latter be secure? The prudence of every man would shun the danger. The rules & forms of justice suppose & guard against it. Will two thousand in a like situation be less likely to encroach on the rights of one thousand? The contrary is witnessed by the notorious factions & oppressions which take place in corporate towns limited as the opportunities are, and in little republics when uncontrouled by apprehensions of external danger.
Madison also expressed his skepticism of majoritarianism to the Virginia ratification convention, where he observed that “on a candid examination of history, we shall find that turbulence, violence, and abuse of power, by the majority trampling on the rights of the minority, have produced factions and commotions, which, in republics, have, more frequently than any other cause, produced despotism.”
Madison and his follow Framers attempted to address the problem of majoritarian abuse of rights by establishing an “extended republic” large enough to prevent any faction — by which was meant a group that is motivated by interest, or what we call “interest groups” — from gaining a majority in the electorate, supplemented by an elaborate scheme of federalism, separation of powers, limited and enumerated federal powers, a few constraints on state powers (later greatly expanded by the Republican-dominated Thirty-Ninth Congress’s Fourteenth Amendment), and eventually a Bill of Rights. These are the limits on federal and state powers that are baked into the Constitution, but have failed to hold. Or perhaps more accurately, given that some limits on power clearly remain, these constraints failed to hold the line the Framers were attempting to draw.
Why this expansion of power occurred is extremely complicated. Some of the blame can be attributed to the Civil War that transformed the dominant American culture from fearing consolidated national governance to believing that a strong national government was needed to ensure justice with respect to slavery and, soon thereafter, other so-called “progressive” ideals. As a result, the Constitution was amended to provide for the direct elections of senators and a national income tax, two developments that seriously compromised the limits inherent in the Framer’s handiwork. In addition, during Reconstruction, a conservative Supreme Court gutted the Fourteenth Amendment’s constraints on the powers of states to violate the rights of their own citizens on the ground that such a change was too radical to have possibly been Congress’s intent. The Privileges or Immunities Clause has not been heard from since. And this is all before the massive progressive onslaught against the Supreme Court in the early twentieth century when it dared find limits on the exercise of state and federal power in cases such as Lochner v. New York — an assault culminating in the Hoover and Roosevelt-appointed justices’ constitutional revolution of “judicial restraint,” to which some political conservatives, and even some libertarians, adhere to this day.
Assuming as I do this great expansion of government power is considered a problem to be solved rather than progress to be hailed, one response is the refrain, “eternal vigilance is the price of liberty.” True, while the original constitutional lines may not have held, perhaps there is simply no realistic alternative to trying harder, electing the right persons, supporting the right judicial nominees, advocating the right policies (e.g., think tanks like Cato!), and even amending the Constitution to make its limits even clearer. In the present political context, all this seems to be advisable and worthwhile for those who care enough about limited government to do something about it. But some libertarians want more.
Some libertarians prefer a different legal structure, one that promises to work better than the structure provided by the Constitution. Such a structure would take the principles or strategies embodied in the Constitution farther than did the Framers. These principles are (1) reciprocity of power between the ruler and the ruled that is supposed to be accomplished by voting, (2) checks and balances on power that are supposed to result from federalism and separation of powers, and (3) the power of exit that is provided by free emigration and, formerly, the power of secession. These libertarians merely propose two itsy-bitsy, teeny-weenie changes to the status quo: First, end the government’s power to put its competitors out of business by force (which violates the freedom to contract of those who wish to provide and obtain such services); second, end the government’s power to confiscate its income by force (which violates the freedom from contract of those whose property is taken without their consent). Not much really.
What these libertarians hope and expect would result from these two changes is the evolution of a polycentric constitutional order in which one would subscribe to a legal system of one’s choice as today one subscribes to cell phone service, health and auto insurance, or private security providers. The ability of buyers to withhold their patronage and payments from sellers is the most powerful form of reciprocity. Having competing separate legal systems would provide far more effective checks and balances. And simply by switching justice and law enforcement providers, individuals would be able to assert the power of exit without leaving home. Of course, there is much more to be said about all this, which I explain in far greater detail in my book, The Structure of Liberty: Justice and the Rule of Law (Oxford, 1998).
But why spend any time at all considering so radical an alternative that is so unlikely ever to be achieved? First, because it is useful to identify the best way of limiting the powers of those who are responsible for the protection of our rights. Such an ideal is not utopian; the claim is that a polycentric constitutional order is the best practical way of limiting the powers of governance, regardless of how unlikely it is to ever be adopted.
Second, familiarity with the polycentric constitutional ideal liberates one from fearing the following reductio ad absurdum: “Well, if we took the commitment to individual rights really seriously, it would lead to anarchy!” To the extent “anarchy” equals chaos, this is simply not the case. To the extent that “anarchy” is simply another word for a polycentric constitutional order, then the response is “sure, but such a proposal is far from absurd.” Indeed, the absurdity is to believe that we need only continue to elect the right persons to succeed in protecting our rights over the long term. Libertarians know that there is a “structure of liberty” that needs to be understood to be maintained, and needs to be maintained or the good of the individual will be sacrificed for the supposed good of the many.
Finally, an appreciation of the polycentric constitutional ideal can help us appreciate why restoring the characteristics of the original Constitution as amended by the Fourteenth Amendment that have been gutted would be far preferable to the constitutional status quo. Urging a restoration of the original Constitution as amended is not to pine for constitutional law as it existed before 1973, 1965, or 1937 — or what has been called a “Constitution in exile.” Rather, it is to advocate that the whole Constitution be faithfully followed (even the nonlibertarian parts), which has not been the case for a very long time. Despite the Constitution’s serious deficiencies from a libertarian perspective, restoring it as amended by the Fourteenth Amendment would result in considerably more libertarian governance than currently exists. And, unlike some other libertarian policies, such a proposal resonates with Americans who were raised in a culture in which reverence for the Constitution is a matter of abiding faith.
Thus, the pursuit of limited government can simultaneously operate along two interrelated tracks: (1) Develop and better understand the ideal libertarian polycentric constitutional order; and (2) work for the restoration of the whole Constitution which would provide a meaningful movement towards the ideal. In my experience, each enterprise informs and strengthens the other. But will either of these strategies really work? All we can do is what is within our power to do, and perhaps this is for the best. For if it was in the power of an individual or small group to remake society to its desires by pressing a button, we would long ago have perished in the Leviathan or worse.
Randy Barnett is the Carmack Waterhouse Professor of Legal Theory Georgetown University Law Center and a Senior Fellow of the Cato Institute. He is the author of Restoring the Lost Constitution: The Presumption of Liberty (Princeton 2004).
The Possibility of Limited Government: Rejoinders
I shall try to respond to some of the points made in three interesting papers by way of direct comments on my essay “Government, Bound Or Unbound” or tangent to its subject.
By entitling his lively paper “Can An Omnipotent Government Make A Rock Bigger Than It Can Lift?” Michael Munger very properly places the debate on the level of logic, where it mostly belongs. The question he poses is not a true paradox, a no-exit logic trap, for it has a straightforward issue. A rock too big to lift by an omnipotent government cannot be made any more than an object that both flies and rests on the ground, or one that is both black and white at the same time can be made. Such objects are defined by contradictory premises, and cannot possibly exist. They are not feasible and lifting them is consequently also infeasible. Making, changing, or breaching rules is at least feasible, if not always simple. Government and its allies in what I call the “winning coalition” can undo rules that stop them from doing what they wish to do or feel they must do to retain their supremacy over the “losing coalition.” The basic reason is that the rule system is ineluctably self-referring: it defends certain limits upon government action by providing for the government to enforce the limits.
Though I do not think it is as primordial as theorists steeped in American political traditions and culture regard it, I must at this early point in the argument try to come to an understanding on the separation of “powers.” Michael Munger illustrates its workings by envisaging three persons of diverse inclinations and interests, each holding a different key. For a momentous decision, all three keys are needed but not many decisions will be acceptable to all three.
Munger omits to say, though, as does everybody else who represents the separation of powers as the mightiest bulwark against excessive government, that only one person of the three carries a gun, the sole “legitimate” gun in existence (as Max Weber’s question-begging definition has it). In the blessed United States, this may have no more than theoretical significance. But the threefold separation of “powers,” which I insist on calling “functions,” is being aped all over the world, from Pakistan to Venezuela and across Africa. In those places, the monopoly of the gun (politely called the “security services”) does have strong practical significance. As men are merely human, it would be strange if it did not, and it may one day have such significance even in mature civilizations if and when push comes to shove. Let that day never come.
Let us now revert to the central point. Kenneth Arrow called the “social” (or to use a less value-laden word, the “collective”) choice rule a constitution. This equivalence should be a reminder that politics is the rule-bound practice of dividing a population in two halves, one whose preferences prevail and one who must forgo theirs. Unanimity needs no rules, while a collective choice rule is a standing invitation to potential winners to coalesce and impose their will on the prospective losers.
The question, then, reduces to this: given that a prospective government must bid for enough support to form a winning coalition, and an incumbent must do the same to prevent rival bidders from unseating it, can a collective choice rule that would thwart the auction and put the maximizing solution out of reach, survive for long?
Michael Munger clearly answers “yes”: limits on government action are perfectly “incentive-compatible” (both Ulysses and the ship fare better if he stays tied to the mast). The contrary temptation is rendered powerless by a commitment to resist it, and that includes a complex commitment not to sanction those outside the government who may impose the resistance upon it. Now, commitment in the rigorous sense is rare. It is difficult to make credible and effective, and is vulnerable to abuse and exploitation. Nevertheless, if government could have commitment power, we should sing Hallelujah. The thesis that they do have commitment power would revolutionize political theory. Remember that Thomas Schelling equated a constitution to a vow. Unlike a true commitment, a vow is kept as long as you choose, for whatever reason, to keep it. Unlike a promise to another (which is stronger than a vow but may fall short of a commitment) the breach of a vow does not violate the right the promise has conferred upon another party and hence involves little risk of retaliation.
However, Munger wisely does not long insist on commitment, but falls back on self-restraint by prudential interest. He cites the example of 17th and 18th century England that never used its power to default on its debts and was therefore always able to raise money at reasonable rates. The French king, on the other hand, was too powerful for his own good, so lenders would not accept the default risk and thus he was left chronically short of cash.
I should be among the last to complain of subjective readings of history, but this particular one certainly needs some amplification. The French royal administration was not unaware that if it defaulted on a loan, Florentine bankers would get the message and future borrowing would become difficult. The problem was that the judgments, or probably misjudgments, made about the requirements of French national security had led to almost permanent warfare, first against the Spanish Habsburgs and then against England, culminating in the Second Hundred Years’ War ending at Waterloo. By the end of Louis XIV’s reign, France had been bled white and was quite poor. Things got no better during the Regency and the reign of the amiable Louis XV (who, far from being too powerful, was unable to prevail over the established corporations and his excellent ministers had to abandon their efforts at reform), and so the hapless Louis XVI inherited a country teetering on the edge of bankruptcy. In short, France could not borrow because it was insolvent, England could because it was more and more solvent. The French kings being too powerful, as Munger tells it, may have had something to do with France becoming insolvent, but the causation is second- or third-order.
Be that as it may, it would be foolish to deny that self-imposed restraint may bring benefits to the government and its winning coalition in certain areas. Such restraints lead the winners to forgo certain benefits that could be had from imposing losses on the losers. The real point at issue is not which is bigger, nor the distributive incidence of each. The real issue is whether there is a set of rules that can actually force a government not to do what it desires to do, or believes it needs to do, and would do if the rules were different. It is having to live with such a rule system that would be “incentive-incompatible.”
What “Is Limited Government Possible?” seeks to prove is that if such a rule system were put on the statute books, it would be amended, corrupted, bent, got round of, or swept away. One enabling cause of this fate is that the self-referring enforcement mechanism upon which constitutions depend is intrinsically defective. Government will not punish itself. It strikes me as odd that none of the three respondents to my paper has paid any attention to this point. Perhaps it is less important than I believe.
Munger concedes, with a regret I share, that the zone of collective choice has been massively encroaching on the zone of individual choice in much the same way as is explained and predicted by the solution of the maximization problem faced by the government and its winning coalition. I should like to feel that he and I see eye to eye on why this happens.
I do not relish a Methodenstreit, but Gerald Gaus raises a vital point that is drawing me into one. He deplores that my analysis runs in terms of the narrow interests of government and its allies. He believes that moral sentiments are the really important elements of political motivation, and would include them in people’s “utility functions” where they might be the dominant variable. Having done this, he plants us back in the tautological and obsolete world of utility and its analytical extension, utility maximization. Moral sentiments are commingled with any and all other reasons that may motivate choice, and disappear in the impenetrable darkness of the mythical entity “utility.” People make the choices that have the greatest utility, for otherwise they would have made different choices. The statement that they maximize it is neither verifiable nor falsifiable. One is moved to say, with Wittgenstein: “Whereof we cannot speak, thereof we must be silent.” The trouble is that even in these modern days this fastidious advice is so lightly disregarded.
The saving grace of using interest as the motive of choice is that for all its narrowness, it deals in matter that is identifiable, ascertainable and with a bit of luck even quantifiable. It rests on the robust assumption that people would rather have more advantages than less, and will choose alternatives accordingly. Since the advantages can be largely discerned without getting inside people’s heads, the statement is falsifiable, meaningful. It predicts broad outcomes not too badly, though not faultlessly. Imputing outcomes to our moral sense explains outcomes absolutely faultlessly. It cannot be disproven.
One can feel dissatisfied with Gaus’s reversion to the utility-maximizing paradigm on a less exalted level, too. The moral sentiment most relevant to political choice is fairness. People claim fairness mostly for themselves, but they undoubtedly want it for everybody else as well. However, the notion of fairness is an extraordinarily messy, disorderly one. Theorizing about it is an enterprise rather like herding cats. (The attempt to account for the emergence of fairness norms in Cristina Bicchieri’s highly-rated “social grammar” conjures up in my mind a squadron of over-equipped, late-model fighter planes sent to chase a desert Arab on a donkey). Experimental game theory finds that players often deviate from the solution that would maximize money payoffs, and these deviations may be imputed to fairness motives. But it is one thing to interpret the proposers’ tendency in an Ultimatum Game to aim not too far short of half-and-half sharing as a mark of their sense of fairness. It is quite another to translate this finding, derived in highly artificial conditions, to real-life political choices. It is done nonetheless, and we have no means for saying that it is wrong, but we are certainly not justified in claiming that it is right. Egalitarian policies look like confused products of some fairness notion. But they also look suspiciously like the product of one group using politics to make itself better off at the expense of others.
The final point of my rejoinder to Gaus concerns remedies. He proposes that “we should use our intelligence in determining where and how to employ our moral sentiments.” But we have already determined how to employ them, and we can only wish good luck to whoever sets out to persuade us to employ them some other way. Appealing instead to people’s interests and persuading them that egalitarian policies are ultimately harmful even to the apparent gainers among them, looks to me a slightly less unpromising endeavor.
I regret that Randy Barnett chose not to refer to my paper, for I should certainly have benefited from his criticism. He provided instead a compact and persuasive account of the erosion of the U.S. Constitution. I am neither competent nor called upon to comment on it.
He also puts forward two remedies to which I should like to append two remarks.
One concerns the proposal to reverse the course of constitutional development and steer it back toward the framers’ original intent. To achieve this, Barnett suggests, America must elect the right people. However, for the last two hundred years America elected the wrong ones, and American voters look unlikely to shed this bad habit merely to recover the constitution of original intent. So far, they have behaved as if they wanted to get ever further away from it. One would welcome the discovery of an incentive that would induce them to act differently, and durably so.
My other remark relates to the libertarian idea supported by Barnett of a polycentric system of competing providers of justice and law enforcement among which people could freely choose. One is reminded of Nozick in his libertarian phase who envisaged the emergence of competing “protective agencies” that would defend their clients’ “rights.” Nozick saw this as an industry working to increasing returns. Hence a single dominant protective agency would ineluctably emerge. Oddly enough, Nozick did not move on to the further ineluctable consequence that the single agency would protect “rights” against everybody except itself, nor that it would offer more and more free or subsidized public goods and services to the disproportionate benefit of its supporters and at the disproportionate cost of its potential opposition.
The conclusion that tentatively suggests itself is that no solution to the problem of “unbound” government is likely to be found in formal constitutional reform, restoration, or ingenious new design. Formal constitutional constraints are not good or bad, strict or loose, but ultimately irrelevant.
I shall try to respond at great length soon. But I would like to make three brief points:
1. The title of the essay is not intended to be paradoxical, but is intended to make just the point that Anthony makes: No government can make a rock so big that it can’t lift it. As Jerry Ford once said, “A government big enough to give you everything you want is a govenrment big enough to take from you everything you have.” Anthony and I agree.
2. Nonetheless, governments have strong incentives to solve this problem. Anthony is entitled to his own view of French and English history, and I’m sure he is wrong about other things, too. Checks and balances are an important part of the American solution, at least. And Montesqueieu, rightly or wrongly, thought the English “Constitution” had by happy accident many of the same salubrious properties that are present in the American design by clear intention.
3. Most of all, I second his concluding thoughts. We do agree, and I think for the same reasons. He is correct in his analysis, I believe, and I tried to agree with him in my paper. It is just that I agree with other people so rarely that I appear to have lost the knack of conveying agreement, and it sounds like critique. So, let me be clear: we do see eye to eye, and I think that his reasons are primary. I was simply illustrating them, perhaps poorly, rather than trying to propose an alternative or competing explanation. Anthony is right. There, I said it.
In his reply to my post, Tony repeats a common mischaracterization of Nozick’s argument. In Anarchy, State and Utopia, Nozick made no prediction about the emergence of a dominant protection agency. Nor did he describe a mechanism for that emergence. Rather, his argument was that a dominant protection agency could emerge morally without violating anyone’s rights. This moral argument was countered by several contributors to the first issue of the Journal of Libertarian Studies, which you can access here (scroll down to the bottom).
This is not to say that someone might not make the argument that a polycentric constitutional order would eventually evolve into a monopolistic system, but only that Nozick did not make such an argument.
And in my essay, I never claimed that electing the right persons is a practical long term strategy to limit the powers of government. On this issue Tony and I agree. My only point is that engaging in electoral politics to pick the lesser of evils, along with other efforts within the prevailing political structure, is better than doing nothing at all. But many libertarians want more, e.g., a polycentric constitutional order.
The Myth of Interest
In his reply de Jasay makes two claims.
First, he claims, “The saving grace of using interest as the motive of choice is that for all its narrowness, it deals in matter that is identifiable, ascertainable and with a bit of luck even quantifiable.” There is a well-known, notorious, problem with this old view. If we employ a narrow concept of interest, then I think the evidence shows that it is simply false that most political behavior can be explained in terms of such interests. A number of empirical studies show that narrowly interested concerns do not count for most of the variance in electoral behavior. Voters seek environmental goods, social goods (such as less homelessness), and they vote for minimum wage legislation when they are earning $200,000 a year. Overall ideological commitment is a crucial factor, and narrow interest is simply an inadequate explanatory hypothesis. The same goes for politicians; that their overriding concern is interest narrowly defined just does not explain most of what goes on. The interest theorist is then driven to respond by expanding the notion of interest: the rich voters who vote for minimum wage laws are just trying to feel good about themselves! So now “interest” includes a wide array of goods in which people are interested in, and which they seek to promote. It becomes anything but a clear useful concept. IT is the tautological doctrine. A false hypothesis or an empty one — that is what accounts of interest as the root of political motivation must always choose between.
Second, de Jasay asserts:
The moral sentiment most relevant to political choice is fairness. People claim fairness mostly for themselves, but they undoubtedly want it for everybody else as well. However, the notion of fairness is an extraordinarily messy, disorderly one. Theorizing about it is an enterprise rather like herding cats. (The attempt to account for the emergence of fairness norms in Cristina Bicchieri’s highly-rated “social grammar” conjures up in my mind a squadron of over-equipped, late-model fighter planes sent to chase a desert Arab on a donkey).
Ah, I am sure if I knew what all this meant, I would be able to better reply, but simply dismissing Bicchieri’s work in this way deflects us from the core point. There is overwhelming evidence fairness matters to people, and their decisions are affected by it. If it was the case that that which is not clearly quantifiable does not exist, we could dismiss it. But the simple truth is: narrow interest explains some of political behavior, ideological convictions and fairness norms explain a good deal too. Empirical evidence cannot be dismissed with a quip.
What de Jasay and so many classical liberals cannot bear is that an expansive welfare state has been supported largely because the majority of voters and politicians believe it is fair and just. All the quips in the world cannot change that.
Of Little Green Men and the Fairness of the Welfare State
A survey, apropos Prof. Gaus’s use of survey research on fairness:
Seriously, what kind of riposte is it that “What de Jasay and so many classical liberals cannot bear is that an expansive welfare state has been supported largely because the majority of voters and politicians believe it is fair and just”?
65% of the voters and politicians believe that little green men crashed at Roswell.
It is true that in a democracy each of us is constrained to act in the way that most of us like. That’s why democracy is so dangerous.
Now, were I in a charitable mood (and, honestly, I never am), I might say that Prof. Gaus is simply pointing out that beliefs matter, and a claim that “we” (classical liberals) want simply to use force rather than persuading others that their views on fairness are wrong would seem to be contradictory.
It seems to me this should come down to a burden of proof argument. Is it really true that the ideal form of government is one that defines “fair” as “instate envy as a moral virtue, and take money at gunpoint from those who have earned it, and give it to others chosen by the majority?”
Why is it that the majority has presumptive right to decide such matters at all? True, the majority may be able to force its will as a matter of power, but the fact that majority of voters believe something makes it policy. It doesn’t make moral.
The welfare state is based on the idea that I can act on my own sense of guilt by giving other people’s money to the poor. I don’t see how one can read “I want to give other people’s money away” as a moral claim at all. It is a very simple consumption impulse, only without actually paying for your own consumption:
“I like hamburgers, and am willing to pay for them.”
“I think the poor should have more money, but I don’t feel this strongly enough to act on that impulse. I am, however, willing to give them some of yours.”
That Dangerous Invention
Mike Munger quotes me as saying: “What de Jasay and so many classical liberals cannot bear is that an expansive welfare state has been supported largely because the majority of voters and politicians believe it is fair and just”. He asks: “Seriously, what kind of riposte is it that?” And he adds “65% of the voters and politicians believe that little green men crashed at Roswell.”
I am perplexed by Mike Munger’s reply: I maintained that the welfare state is not based on a power grab based on the pursuit of interests but on the majority’s sense of fairness, and he replies that the majority is stupid and that the results are not fair. But that is just not the point. The debate between de Jasay and me was: pursuit of interest or belief in fairness? Munger replies: stupid and not fair. My claim was that the problem was not that interests are unbound, but that classical liberals have a very different understanding of the moral limits of government than their fellow citizens.
Since Munger has raised the polemic ante, I’ll see him and raise.
Leaving aside the fact that Munger’s “reply” is largely irrelevant to what I said, the interesting thing about what he says is that so many classical liberals just cannot help attacking democracy, even when the debate is not about democratic competency but about motivation. Classical liberals — especially those with economics backgrounds — just love to attack democracy.
Munger stresses that “democracy is so dangerous.” Here is the problem of classical liberals of his ilk: the only form of political organization that has had a sustained history of avoiding repressive government is “dangerous.” I take it that Munger is basing his claim on the history of the twentieth century and just how terribly dangerous democracies were to the world. So what are the good old non-democratic times when people were truly free? Well, maybe it was the United States in the 19th century — but then slavery doesn’t look so awfully freedom-enhancing, does it? How about the United Kingdom In the 19th century? Of course there was the Act of Uniformity, the Test Acts and the Penal Laws that disadvantaged Catholics. And then there was the Six Acts in 1819 which curtailed civil liberty, which strikes many of us as dangerous. No ignorant public ruling then, just a better-educated upper class repressing some. Of course Catholics were emancipated by 1829; but then we get the reform Act of 1832 and — gasp — the beginnings of that dangerous invention known as democracy.
Maybe the Golden Age was when we no longer had rule by the aristocracy but had not yet succumbed to the horror of giving the ignorant workers something so “dangerous” as a vote. The Irish probably would have disagreed. Maybe we should look to non-democratic havens such as Pinochet’s Chile. After all, if it had a privatized pension system it must have been a beacon of liberty. There is always the model of Hong Kong under the British as the general model of how to institutionalize freedom in the world. If you are desperate for a truly non-dangerous non-democratic government, maybe your ideal is Singapore.
It is such a pity that so many of today’s classical liberals such as Munger have talked themselves into being anti-democrats. The long slide of classical liberalism since J.S. Mill — from a plausible political theory to a sort of irrelevant cranky complaint about the modern world — is all too apparent. Mill was well aware of the dangers and infirmities of democracy; he did not need Bryan Caplan’s book to know that there was a “low grade of intelligence” on the part of many voters. But he did not become an an anti-democrat (when that view was not confined to cranks) because he knew that no group of people — not even public choice economists — can be trusted to govern in a way that even has a chance of respecting the freedom of all. Of course democratic government is flawed. Duh. But anyone who thinks that somehow widespread freedom and democratization are inversely related … well, such a person is apt to be a contemporary classical liberal, I’m afraid.
Fairness and Majority Rule
Professor Gaus’s contributions of February 21 and 22 to the debate do not seek to answer my charge that his explanation of political outcomes via a holdall “utility function” (whose principal variables are moral sentiments) is both unverifiable and unfalsifiable. He does, however, make a variety of other assertions that do not seem to be conducive to close reasoning. Hence this re-rejoinder to his reaction to my rejoinder.
The controversy is best kept manageable by reducing it to its bare bones: is interest or the desire of fairness for others the dominant variable in motivating political outcomes?
For Gaus, “…the welfare state is not based on a power grab based on the pursuit of interests but on the majority’s sense of fairness.” Fairness is desired for others no less than for oneself. It is the chief variable in the “utility function.”
If this were true of everyone, better-off and worse-off alike, any collective choice rule would produce the “fair” result. Minority rule would generate much the same welfare state as majority rule. (The reason is that conflict over distribution would not exist).
Why, then, does Gaus need majority rule? The sole necessary reason I can see is that while a majority can be found “for” fairness, a minority will be against it. There will be distributional conflict. Government will buy “fairness” for some or all in the majority with the money of some or all in the minority.
Since rich-to-poor redistribution can always trump (has a greater potential “yield”) than poor-to-rich redistribution, a bid offering “fairness” to the worse-off will beat a rival bid offering “unfairness” to the better-off. Hence the worse-off and the middle will form the majority and the better-off the minority.
This stylized result is obtained by using the fairness motive as represented by Gaus. Precisely the same result has been obtained long ago by using the interest motive. It is puzzling to find Gaus arguing passionately that one is right and the other wrong.
Utility, Morality, and the Majority
I will try my best to engage in close reasoning in response to Anthony de Jasay’s reply to my points. Let me then be very careful, even if this means being a somewhat pedantic. From his previous comments I thought that de Jasay did not wish to engage in a methodological dispute. Obviously I was wrong.
Anthony de Jasay says:
Professor Gaus’s contributions of February 21 and 22 to the debate do not seek to answer my charge that his explanation of political outcomes via a holdall “utility function” (whose principal variables are moral sentiments) is both unverifiable and unfalsifiable.
As we all know a utility function is simply a formal representation of consistent choice over outcomes, with consistency understood in terms of completeness, transitivity, etc., and, if the function is cardinal, let us say also the standard von Neumann-Morgenstern axioms (I warned that this might get pedantic). The axioms that must be met by a well-formed utility function provide formal, not substantive, constraints, on choice. Some have argued that it will always be unverifiable whether a person demonstrates consistent choice because, say, it could never be shown that a person violates the transitivity axiom because preference change might always explain choices that appear intransitive. If that is what de Jasay has in mind, his is a subtle point. More generally, a similar deep question confronts any rational actor analysis: are we stipulating rationality or showing it? This is a long-standing debate in the philosophy of social science. I must say that I do not think that the hypothesis of consistent choice is really immune to evidence and so is unverifiable: there is evidence that can be brought to bear on the question of whether a person has changed preferences or violated transitivity. (Do the preferences tend to “change” back again? If so, the hypothesis of preference change rather than intransitive choice looks less plausible.)
My impression, though, is that de Jasay’s concern was not with this point. What he didn’t seem to like was my claim that, in order to accurately model people’s choices, we often have to suppose that their preferences are affected not only by their interests but by certain notions of fairness. I believe that it is what he thinks is unverifiable and unfalsifiable. Well, there is now a large body of experimental literature, the upshot of which is that in many contexts consistent choice over options is best explained and predicted by the hypothesis that people’s preferences are influenced by norms of fairness and other moral sentiments. I cited some of this research in my reaction essay, since I agree with de Jasay that evidence, not an a priori claim, is needed here.
As far as I can see, de Jasay is dismissive of this body of research, but that he is dismissive of certain empirical evidence does not, in my view, show that any of these claims about people making choices on the basis of moral norms and sentiments are “unverifiable and unfalsifiable.” Perhaps de Jasay is calling attention to the leap from experimental findings to general claims about politics. Fair enough: we need to do more research. But why should these claims be unverifiable in politics when they have been so well tested in experimental settings? And why are they less verifiable than the claim that people act only on their interests? (Which, indeed, I believe has been shown to be simply false.) Experimentalists have been able to formulate relevant hypotheses. That is the crucial point. A claim that can be, and has been, tested, simply cannot be called “unverifiable and unfalsifiable.” Again, the only thing de Jasay’s assertion could plausibly refer to is the general claim, considered in the previous paragraph, that the hypothesis that people are consistent or rational choosers cannot be tested. But, as I said, this is a general problem of all rational actor explanations, including those based on interests.
Next, de Jasay says:
For Gaus,”…the welfare state is not based on a power grab based on the pursuit of interests but on the majority’s sense of fairness.” Fairness is desired for others no less than for oneself. It is the chief variable in the “utility function”. [I actually never made such a strong claim: I held that “Our sense of fairness is as much part of our utility function as is our aim for wealth or other goods” — a rather more modest claim.]
de Jasay comments:
If this were true of everyone, better-off and worse-off alike, any collective choice rule would produce the “fair” result. Minority rule would generate much the same welfare state as majority rule. (The reason is that conflict over distribution would not exist). Why, then, does Gaus need majority rule? The sole necessary reason I can see is that while a majority can be found “for” fairness, a minority will be against it. There will be distributional conflict. Government will buy “fairness” for some or all in the majority with the money of some or all in the minority.Since rich-to-poor redistribution can always trump (has a greater potential “yield”) than poor-to-rich redistribution, a bid offering “fairness” to the worse-off will beat a rival bid offering “unfairness” to the better-off. Hence the worse-off and the middle will form the majority and the better-off the minority.This stylized result is obtained by using the fairness motive as represented by Gaus. Precisely the same result has been obtained long ago by using the interest motive. It is puzzling to find Gaus arguing passionately that one is right and the other wrong.
Now, de Jasay seems to argue:
(1) Gaus “needs” majority rule because people disagree about fairness (they have “distributional conflict”);
(2) If people disagree about fairness this must mean that the majority’s notion of fairness rules;
(3) But (2) means rich-to-poor (and middle class) redistribution occurs.
(4) This is because “a bid offering ‘fairness’ to the worse-off will beat a rival bid offering ‘unfairness’ to the better-off.”
(5) But this same result has “long been obtained” by appeal to the interest motive, so why think that fairness is right and interest is wrong, and why should Gaus be so passionate (leaving aside, of course, my general passion for life)?
There is much that is perplexing here, at least for one who, like me, has such trouble with close reasoning. Leaving aside what is meant by the reference to my “needs” in (1), claim (2) looks plausible enough. What about (3)? The idea that fairness (for example, claims of desert) never benefits the better-off seems extreme. It is certainly interesting to ponder why, if politics is simply about the pursuit of interest, there is not a lot more redistribution. Think of John Stuart Mill’s worries about the poor plundering the rich. To be sure, there are rival explanations, but one is that the poor and middle class think that much of the income of the rich is deserved. Again, there is relevant evidence: empirical research indicates that the typical citizen does care a good deal about desert in the distribution of incomes. One of the things that drives some egalitarians to distraction is that so many low-income people think high-incomes earners deserve their high incomes. There is also strong experimental support for the claim that, while people do think that fairness requires an income floor, they reject an income ceiling. So disagreements about fairness cannot be simply translated into self-interested disagreements about distributive shares.
Let us accept, though, that there is indeed redistribution away from the rich, and let us accept that both a fairness and an interest account would predict this. So let us focus directly on (5), the conclusion. That the same consequence is explained by two different hypotheses does not show that there is nothing to choose between the two hypotheses, or that one should not be passionate that one is right and the other wrong. What could be more common? That, after all, is precisely what scientific dispute is about: debate about the correct explanation of the same event. This is not to say that the theories are extensionally equivalent, for in other contexts they may make different predictions. And, importantly for what the dispute between us was originally all about, they point to different diagnoses of why the welfare state has been able to so easily expand beyond the limits of classical liberal constitutional constraints. If the interest explanation is correct, one response is appropriate; if the fairness response is correct, that response may not succeed, since the aim is not to restrain the simple pursuit of interest but the expression of moral sentiments. I tried to make clear in my reaction essay that available evidence indicates that interests and moral sentiments respond differently to authoritative rule makers. Lastly, de Jasay’s claim (4) simply begs the question: (4) assumes that the state is taking “bids” and so the core of the matter is interest, but the argument was seeking to show that. (At best, it is a tendentious way of describing majority rule).
One of the things that has struck me during these exchanges was the hostility of some of the other contributors to the idea that a plausible explanation of the welfare state is that it appeals to the moral sense of the large majority, or the claim that this is morally relevant since democracy is a good thing. I do not believe that either of these claims are idiosyncratic or odd. The empirical claims I have made, I think, are reasonably well supported by the evidence; in another post I was so rash as to defend democracy, and the idea that it has been shown to be a reasonably effective way to prevent repression. What is quite astonishing to me is that my fellow classical liberals find all of this so outrageous. One can only wonder how an important part of the liberal tradition has gone so far astray, doubting that people are moved in political life by morality as well as interest, or that democratic rule has any legitimacy. I disagree with the moral judgments of the majority on most matters, but I do not have the disparaging attitude that sometimes seems to characterize today’s classical liberals.
What’s a Libertarian To Root For Now?
I appreciate the invitation to participate in this lively debate. Will Wilkinson, the managing editor, has posed a final set of questions that are worth addressing:
Assuming that no transition to ordered anarchy is within reach, what should classical liberal attitudes be toward the status quo? If we’re not going to get a minimal state, or ordered anarchy, should we fight for one kind of big government over other kinds? That is, does liberty do better under certain kinds of “bigness”? Or is our time better spent loudly pointing out the illegitimacy of what much of the government does?
The exchange between Jerry Gaus and Michael Munger on the merits of democracy provides a useful entry point. While Michael seems to be knocking the merits of democracy, Jerry chides him for longing for a Golden Age of Liberty in a past that is rife with nondemocratic oppression. I think both are right.
The principal reason to question democracy is to undercut the facile claim that majoritarian rule is the only or most legitimate form of rule. To the contrary, as I noted in my original post, curbing abuses of power by majority factions was a very serious problem that led to the replacement of the Articles of Confederation by the Constitution. The Founders’ attempted solution was a new form of “republican” government by which the majority would not rule directly, but would have the means of checking abuses of power by those few in the government who actually do rule. So the legislative branch included a majoritarian House of Representatives, the judicial branch included a right to a jury composed of members of the community, and the electors who were to select the president were themselves chosen by voters. For better or worse, in the twentieth century we have moved away from this republican form of limited government towards a more “democratic” or majoritarian form of government with fewer structural limits on legislative power.
But majoritarianism is not a solution to the question of legitimate rule; it remains a problem to be solved. As political philosopher Jeffrey Reiman explained his article, “The Constitution, Rights, and the Conditions of Legitimacy,” in Alan S. Rosenbaum (ed.), Constitutionalism: The Philosophical Dimension (New York: Greenwood Press, 1988):
there is nothing inherently legitimating about the electoral process. If anything, the electoral process is the problem, not the solution… . [T]he policies that emerge from the electoral process will be imposed on the dissenting minority against its wishes. And then, rather than answering the question of legitimacy, this will raise the question with respect to those dissenters. Why are the exercises of power approved by the majority against the wishes of (and potentially prohibiting the desired actions of) the minority obligatory with respect to the minority? Why are such exercises of power not simply a matter of the majority tyrannizing the minority?
Reiman then identifies a potential answer to this challenge:
These questions not only point up the error of taking electoral accountability as an independent source of legitimacy, they also suggest that it is mistaken to think of electoral accountability and constitutional provisions as alternative sources of legitimacy. Rather, the Constitution with its provisions limiting the majority’s ability to exercise power is the answer to the question of why decisions voted by a majority are binding on the minority who disagree. (Emphasis added)
And we must also never forget that a legislature is a mere handful of persons, who only metaphorically — and usually fictitiously — speak for “the majority.”
So, I would offer this partial answer to Will’s questions: within the framework of the status quo, libertarians should favor the rigorous enforcement of the checks on legislative power that are already contained in the Constitution. This means favoring a robust form of judicial review of the constitutionality of legislation unbowed by charges of “judicial activism” by “unelected judges” thwarting the “will of the majority.” Thwarting the will of a handful of legislators when they intrude upon the liberties of the majority, the minority, or merely a single individual person is not a bug, it is a feature of our republican Constitution.
My book, Restoring the Lost Constitution: The Presumption of Liberty was intended to provide an accessible description of these constraints, along with a practical means of putting them into effect: Adopting a “Presumption of Liberty” by which the government would have to justify its restrictions on individual liberty as both necessary and proper.
This is not the place to describe exactly how this proposal would work, but suffice it to say it would protect all liberties in much the same way as the freedom of speech is now protected. Wrongful speech (e.g. fraud, defamation) can be constitutionally prohibited; and rightful speech in public places can be regulated by what are now called “time, place and manner” regulations, provided these regulations are scrutinized to ensure that they are not pretexts for the suppression of liberty rather than a means of facilitating its orderly exercise. So too it should be with respect to all individual liberty: the government may properly prohibit wrongful acts and regulate rightful ones, provided its regulations are not pretexts for suppressing the rightful choices of individuals with whom a majority or minority may disagree.
Of course, these constraints on the power of legislatures need not be limited to courts. Presidents and governors should veto legislation that exceeds the constitutional limits on legislative power. In states that allow it, popular initiatives can check legislatures (within constitutional limits). And legislators themselves should take seriously the limits on their own power, though they tend to do this only when they think the other branches are looking over their shoulder and NOT when they think they are exercising complete discretion.
And guess where this puts libertarians? Smack dab in the mainstream of the American people who love their Constitution, even if they are not completely aware of what it says. The same American people who were appalled when Robert Bork compared the Ninth Amendment to an inkblot on the Constitution. So in that spirit, let me close my contribution with these passages of the Constitution as my final answer to what libertarians should be rooting for:
All legislative powers herein granted shall be vested in a Congress of the United States, which shall consist of a Senate and House of Representatives. [Article I, Section 1]
The enumeration in the Constitution, of certain rights, shall not be construed to deny or disparage others retained by the people. [Ninth Amendment]
The powers not delegated to the United States by the Constitution, nor prohibited by it to the states, are reserved to the states respectively, or to the people. [Tenth Amendment]
No state shall make or enforce any law which shall abridge the privileges or immunities of citizens of the United States; nor shall any state deprive any person of life, liberty, or property, without due process of law; nor deny to any person within its jurisdiction the equal protection of the laws. [Fourteenth Amendment]
Adhering to these precepts is not only a good idea; it’s THE LAW!