Institutions, Machines, and Complex Orders (Part 8): Inequality before the law, de facto

François Furet, in the preliminary essay that serves as an introduction to The Past of an Illusion, entitled “The Equalitarian Passion,” highlights that in the Ancient Regime inequality was legally consecrated, while after the French Revolution, inequality persists surreptitiously, of contraband, thus cementing a feeling of vindication in the face of illegitimate inequality. Something similar happens in a system of regulations that, with the intention of serving the common good, re-establishes, de facto, a system of monopolies and oligopolies.

It is paradoxical that a political legal system made up mostly of general and abstract rules finds an unintended consequence of an increase in general well-being, while a regimented system based on a specific goal of social justice and growth finds itself as an involuntary stagnant consequence and with high rates of inequality. However, attentive given that no one can be judged morally for their involuntary results and instead for their intentions, it is commonly interpreted that the success of societies organized around abstract and general principles cannot be adjudicated to such principles, as it is also considered active policies that deliberately seek the common good cannot be reviewed by virtue of their poor results, but in any case what deserves to be discussed are the means to reach such objectives.

Once this point is reached, we discard any political program that does not have a purpose of reform or transformation based on a specific objective and in which the political discussion is about society models and the means to achieve in the practice of the realization of such models, the table is served for the ideologization of political discourse. Kenneth Minogue had rescued the original concept of “ideology” -before the Marxist who points to a set of values ​​of the ruling class at the service of the perpetuation of his power-, which dealt with the set of claims with scientific pretension that, through a redemptorist program, he proposed a series of concrete transformations of society. This word and notion comes from the ideologues of the French Revolution, which mostly fulfilled a pedagogical function.

Since the ideology of politics is installed, any doctrine that arises from its discourse in terms of defending a system of coexistence articulated around abstract and general norms and lacking a specific purpose of designing the society according to a certain model. In the political arena, therefore, there are political programs that seek to impose a certain model of society, articulated around a series of assertions with alleged scientific validity. Whatever the model of society under discussion, by the mere fact of proposing such political programs the transformation of society in function of those, the legal norms expressed in abstract and general terms that make up both the individual guarantees and the private right run the serious risk of being considered as an obstacle and an irrational hindrance of the past that prevents the realization of such models of society. This is the process that Friedrich A. Hayek had described in The Road to Serfdom.

The paradox is that a legal – political system composed mostly of abstract (that is, lacking a concrete purpose) and general (that is, the same for all citizens regardless of their status) rules allows to coordinate in a more efficient way the resources of those that a society has, through a better coordination of individual plans, about whose content we know nothing and whose final configuration is impossible to predict, that is, a complex social order. On the other hand, the abolition or gradual weakening of such a system of coordination in the allocation of resources and its replacement by a system of planning or centralized control of the economy and society based on a specific model generates an economic breakdown that only serves of excuse to redouble centralization in the administration of resources. At one point, neither the model of society nor the need to have a central planning to reach it, nor even that there is such a model or such a central planning of society, is only discussed, but it is indeed discussed which are the most appropriate means to “improve” said model.

That said, it is worth making a terminological clarification: what Hayek called in The Road to Serfdom “socialism” and then in Law, Legislation and Liberty “constructivism,” can be assimilated to a large extent to what Kenneth Minogue called “ideology” (although in truth, it must be recognized that Minogue, at the time, accused Hayek of being an ideological author). But, as Hayek himself clarifies in his prologue to the 1974 edition of The Road to Serfdom, the socialism to which he alluded in 1944 was not income redistribution programs, but the centralized planning of the economy and society . Similarly, Hayek’s critique of the notion of social justice concerns precisely those programs of political reform that seek to establish, through centralized planning, a designed social order. Another issue is the positivization of values ​​through abstract and general rules. A negative income tax – as proposed by Milton Friedman at the time – can be implemented through abstract and general norms, as well as patterns of redistribution inspired by John Rawls’ theory of justice. The problem is not redistribution, but the replacement of a spontaneous social organization system with a centralized planning system.

At the heart of the dispute between the prevalence of a spontaneous social order versus its replacement by a system of centralized planning of society is a divergence around the concept of the abstract. The supporters of the centralized planning of society are convinced that, through the measuring elements provided by science, the wealth of social events can be selected in aggregates that allow forming an abstract model of society, which In turn, it allows planning its reform according to the ideal model of society in whose transformation the political program that gives it reason to be to the politician’s own activity and that justifies his ethics of responsibility.

Of course, statistical tools, which are constantly developing (Hayek himself was a professor of statistics, and from The Road to Serfdom to today appeared the desktop computer and the science of Big Data, for example), allow a better allocation of public resources in the implementation of government programs. It is very useful for the rationalization of the government administration to know how much the population is going to vaccinate, the poverty and indigence statistics in order to determine, for example, subsidies to the demand, or the needs of schooling at its various levels. However, if there is consensus on the need for a vaccination program, or on the importance of subsidizing access to certain goods or the importance of schooling the population, it is because the members of that society already have a set of principles about what is considered good or bad, desirable or undesirable, necessary or superfluous. Such abstract notions do not arise from the abstraction of social events in statistical aggregates, but, on the contrary, these abstract concepts allow to form the groupings by virtue of which the social reality will have to be interpreted.

Such principles are born, develop and evolve according to the game of continuous human interaction. As described above, they consist of uses and customs that individuals incorporate in the course of exchanges and that prove with the passage of time to provide a better performance to the members of the community that follow them. Accounting standards, public behaviour guidelines, compliance with the word pledged, good faith, are examples of such practices that are extended throughout the population by incorporating such standards into the habits of its members. It was what Max Weber at the time conceptualized as the emergence of “rational capitalism.” These principles are not immutable, but on the contrary they adapt to the circumstances. However, they also enjoy certain permanence in time that allows them to serve as a structure or parameter for rational decision-making, since such a structure of values ​​prohibits a certain range of decisions, which makes its transitivity possible.

This system of discovery and spontaneous evolution of the abstract values ​​according to which reality is perceived and its respective organized elements can assume various configurations and has its own process of immanent criticism. The egalitarian guidelines that we can characterize as typical of modern society, in which every human being has the right to have equal consideration and respect, were extended over less efficient structures such as those of the caste and estates societies, in which the restrictions of competition and the unpredictable exercise of political authority generate stagnation (what Acemoglu and Robinson call “extractive economic and political institutions,” as opposed to “inclusive”). For its part, the peaceful resolution of disputes through the right of judges allows readjusting the set of expectations with which each member of society usually makes its decisions.

Such a system of discovery of abstract values ​​with which each individual can count on to coordinate their respective life plans and their corresponding immanent criticism through the judicial system is also susceptible of receiving a critical analysis by a reasoned examination regarding it and as a result of this, a new political legal order or partial reform of the existing one may arise through the legislative promulgation or even of a constituent assembly. A spontaneous order may have as its origin the enactment ex nihilo of it by a legislator, but among its defining characteristics is the note that it should not necessarily be so. Another of its defining characteristics is that the consequences of a political legal order, still created by the will of a legislator or constituent, cannot be foreseen in its entirety. Moreover, the future evolution of this order cannot be foreseen in its totality and detail. Such degree of uncertainty does not come from the deficiency or insufficiency of the elements of measurement that have for object to know the reality, but in the levels of complexity to which such order can arrive in their more abstract planes.

However, these degrees of complexity decrease drastically in the daily experience of the subjects that interact with each other, seeking to coordinate or compete in their respective individual plans, since each one of them knows what expectations to have regarding the actions of the rest of the subjects (the more “inclusive” the institutions are, the lower the degree of uncertainty). For the case in which two spheres of autonomy collide, the controversy will be resolved by a court that will have to say the content of the law for the specific case submitted to its decision. From this result, they will have to configure a set of expectations with which agents will know that they can count or not.

In contrast to this, at the level of the legislator and the political authority, such levels of certainty leave room for increasing degrees of complexity. Although there are many administrative decisions that can be taken with a high degree of probability of being successful following the procedures of administrative law and the general principles of law – what Max Weber described as a process of rationalization in political decision-making , the certain thing is that it arrives at a point in which the legal reasoning arrives at a limit – what in his moment Carl Schmitt characterized like an instance in which the right dies and leaves its place to the policy. This is where the political authority is faced with the need to dispense with the rationalizing element of law and articulate its decision-making process based on another type of “anchoring”: a philosophical doctrine, a conception of life, a political doctrine, a reason of state or an ideology.

Those who oppose the extension of political power over the autonomous institutions and processes of society maintain that such philosophies, reasons of state, or ideologies are mere masks of pure political will left to their free will. However, at least in principle, they can serve as limitations or at least elements of political responsibility of the ruler in a democracy. There are numerous cases in which a democratically elected governor receives criticism from public opinion regarding a supposed lack of consequence with his political doctrine, a double discourse, or the configuration of a consistent but mistaken ideology. Even so, except for the cases of impeachment and the impossibility of re-election, the tools to control the political reasons of the rulers and their consequences are rather scarce.

However, a distinction can be made between a simple political doctrine and an ideologized political doctrine – or, in Minogue’s terms, quite simply an ideology. A political doctrine can sustain a series of diffuse principles that do not exhaust a totalizing vision of reality. For example, German Christian Democracy can be defined equally by rejection of the extreme left, as the extreme right, a market freedom regulated by the State in order to preserve competition from the actions of monopolies (the “competitive order” of Ordo-Liberalism) and the moderate defence of certain values ​​prevalent in society through the non-interference of the government in its autonomous processes, that is, a clear division between society and State. However, no one can define in detail an ideology of German Christian Democracy.

In many circumstances, this “de-ideologization” is interpreted as “pragmatism” or “opportunism.” However, there is also room for opportunism in the interpretation of a political ideology by the public power that invokes it as a reason of state. The great problem that “ideologies” or ideological visions of politics do present is that, by offering a totalizing and scientific version of reality, they can be used as tools to discredit the legal system.

It is true that a legal system could be replaced by another in its entirety through a legislative reform – in the case of private law, a new civil code, for example – or a constitutional reform. But once reformed or replaced by the new, unless a tyranny has been instituted, it becomes the new legal order that will limit the political power. The problem arises when there is a phenomenon that can be named as the “road to serfdom”: the continuous, permanent and incremental discrediting, erosion, violation and exception to the current legal order.

When such a process is presented, freedom understood as the absence of arbitrary coercion is in decline, since, by invoking a reason of state or a state of exception, the expectations with which individuals counted to form their plans of life are frustrated in a way impossible to foresee. As a result, the political legal order becomes perceived as arbitrary and its obligation to obey it put in doubt.

Another consequence of the phenomenon known as the “road to serfdom” is that the system of immanent criticism of positive law affected by the application of this by judges in the face of concrete controversies is eroded. As already mentioned, attentive to the open texture of legal language, the judicial system allows for marginal readjustments on the content of the law that represent a true process of evolution, in the sense of adaptation to changes in the environment. In turn, this readjustment introduces new expectations in the agents, which generates a change in reality and opens the way for a new interpretation change through the open texture of the letter of the law, in a real feedback process negative that gives stability and predictability to the system.

On the contrary, the state of emergency and emergency legislation, as well as legislative and judicial activism, which seek to modify the content of the law not to solve the internal contradictions generated by its open texture, but to transform it according to concepts alien to the law. Right, they erode such a negative feedback system of expectations and, far from achieving the modernization of the law, what they obtain is their obsolescence, their discredit, and their disobedience. See that in countries with a greater authoritarian tradition, the adherence to standards by the population is significantly lower than in countries where emergency legislation and the state of emergency was limited to cases of war.

[Editor’s note: here is Part 7, and here is the essay in its entirety.]

The Negative Capability of a Good Legislator

In a former post, we had explored the idea of considering the law as an abstract machine which provides its users with information about the correct expectancies about human conduct that, if fulfilled, would contribute to the social system inner stability (here). The specific characteristic of the law working as an abstract machine resides in its capability of dealing with an amount of information more complex than human minds. This thesis had been previously stated by Friedrich Hayek in his late work titled “Law, Legislation and Liberty”, aimed to provide the foundations to a proposal of an constitutional reform that would assure the separation of the law from politics -not in the sense of depriving politics from the rule of law, but to protect law from the interference of politics.

Paradoxically, the said opus had many unintended outcomes that surpassed the author’s foresight. One of them was the coinage of the notion of “Spontaneous Order”, which Hayek himself regretted about, because of the misleading sense of the word “spontaneous”. At the foreword of the third volume of the cited “Law, Legislation and Liberty”, he explained why he would prefer to use of the term of “Abstract Order”. Notwithstanding its creator’s allegations, the label of “Spontaneous Order” gained autonomy from him in the realm of the ideas (for example, here).

Why better “abstract order” than “spontaneous”? Because while no “concrete order” might be spontaneous, we could nevertheless find normative systems created by human decision, besides the spontaneous ones (see “Law, Legislation and Liberty”, Chapter V). Moreover, we do not see spontaneous orders whose rules fail to provide stability to the system, because of “evolutionary matters”: such orders could not endure the test of time. Nevertheless, for the same reason, we could imagine a spontaneous order whose rules of conduct became obsolete due to a change in the environment and, thus, fails to enable the social system with the needed stability.

Spontaneity is, thus, not the central characteristic of the law as a complex order. What delimits law from a “concrete order” is the level of abstraction. An alternative name given by Hayek to designate the concrete orders was the Greek term “taxis”, a disposition of soldiers for battle commanded by the single voice of the general. Concrete orders could be fully understood by the human mind and that is why they are regarded as “simple phenomena”: the whole outcome of their rules could be predicted by a system of equations simpler than the human mind.

Notwithstanding a single legislator could sanction a complete set of rules to be followed by the members of a given society, the inner system of decision making of those individuals are more abstract that the said set of rules and, thus, the human interactions will always result in some subset of unintended consequences.

These unintended consequences should not necessarily be regarded as deviations from the social order, but indeed as factors of stabilisation -and, thus, all abstract orders are, in some sense, still spontaneous. These characteristics of the law as a complex order concern on the information about the final configuration of a society given a certain institutional frame: we can establish the whole set of institutions but never fully predict its final outcome. At this stage, we reach what Hayek called in The Sensory Order “an absolute limit to knowledge”.

We now see that the legislator could sanction a complete system of rules -a system that provides solutions for every possible concrete controversy between at least two contenders-, but he is unable to be aware of the full set of consequences of that set of rules. We might ascertain, then, that being enabled with a “negative capability” to anticipate the outcome of the law as a complex phenomenon is a quality to be demanded to a good legislator.

By this “negative capability” we want to designate some understanding of the human nature that allows to anticipate the impact of a given norm among the human interactions. For example, simple statements about human nature such as “people respond to incentives”, or “all powers tend to be abusive”. These notions that are not theoretical but incompletely explained assumptions about human nature are well known in the arts and literature and constitute the undertow of the main narratives that remain mostly inarticulate.

Precisely, as Hayek stated, every abstract order rests upon a series of inarticulate rules, some of which might be discovered and  later articulated by the judges, while other rules would remain inarticulate despite being elements of the normative system.

However, we praise Negative Capability as a virtue to be cultivated by the legislator, not by the judge. The function of the judge is to decide about the actual content of the law when applied to a particular case. It is the legislator the one who should foresee the influence to be exerted by the law upon a general pattern of human behaviour.

Notwithstanding Negative Capability could be dismissed in order of not being a scientific concept, this negative attribute is one of its main virtues: it means lack of ideology, in the sense given to that term by Kenneth Minogue. While an ideological political discourse reassures itself in a notion of scientific truth, at least a legislator inspired by common and humble ideas about human nature would be free from that “pretence of knowledge”.