This post is an update of a previous post on The Charter Cities Debate and Democratic Theory. A new twist on Paul Romer’s idea of charter cities has come to my attention. It is promoted under the name of “free cities.” The home base seems to be the Free Cities Institute headquartered at the Francisco Marroquin University, a right-wing university in Guatemala.
The point of my previous blog was that while Paul Romer may be a normal well-meaning American liberal, his charter cities idea partakes of a much older theme, namely that classical liberalism and libertarianism (always “right-wing” unless otherwise qualified) sees no moral necessity in having political democracy.
The classical liberal view is that consent is the only bottom-line moral prerequisite in a political governance system, and democratic self-government is only one option in the marketplace of permissible governance systems. One could consent to a democratic constitution that guaranteed the rights of self-governance to the citizens–or one might consent to a non-democratic constitution, classically called a pactum subjectionis or pact of subjection, where one alienated one’s self-governance rights to become a subject of a ruler or sovereign (e.g., a corporation). Where such a non-democratic constitution is already established in a polity, then one would give consent by voluntarily moving into its jurisdiction.
The important point, from this viewpoint, is not joint self-governance in a polity but having a real choice between different types of governments that compete against each other in the governance marketplace for businesses and citizens subjects. A well-functioning democracy would be fine but so also would be a classically-liberal business-friendly rule-of-law non-democracy, like (colonial) Hong-Kong or Dubai, where the rulers were “enlightened rulers” (in the sense of having taken to heart the classical libertarian themes of, say, von Mises and Hayek).
One currently popular way of expressing this theme in libertarian circles is to rhetorically ask:
What is so important about democratically choosing a government in one place, when the real point is to be able to democratically choose which government to live under, e.g., by being able to freely migrate to a free city or charter city (and to freely exit if the government breaks its commitment to the rule of law, etc.)?
In this remarkable discourse, even the word “democracy” is bastardized into the description of a wide choice for the customer in the marketplace of governments in the variety of Hong-Kongs and Dubais and the like. For instance, on the Free Cities Institute website, they managed to squeeze in a cognate of the word “democracy” by calling for “Democratizing Choice of Law, Governance, and Regulation.”
My original post and the links there give a more expanded version of the inalienable rights argument against this view that it is OK to alienate one’s rights of self-governance to an enlightened non-democratic ruler. The libertarian case for such an alienation of self-governance rights is coupled with the possibility of exit when the rulers break their commitment to enlightened principles. Thus when things go bad (and history does seem to have some examples of “enlightened” autocrats going bad), then the customer should have the right to freely switch brands, i.e., to exit the “free city.”
In a democracy, the citizens would have the right to “exit” the governments that have gone bad, i.e., to throw the bastards out, but in the libertarian version of the “free cities,” the substitute for those rights of citizens is the right of the subjects to exit themselves, i.e., to “leave it” for some other “free city.” As the ruler-gone-bad would see his subjects leaving for competing “free cities,” then he would be pressured (by the drop in land rents/taxes) in the governance-marketplace to see the errors in his ways and to clean up his act. Thus we see the usual “logic of the competitive marketplace” applied to the question of political governance–with the notion of democracy carefully excised from the discussion except as a description for the customer-subject’s wide choice of brands of governance. For instance, one looks in vain for any discussion of democratic governance of the so-called “free cities” in the website of the Free Cities Institute.
In my previous post and on Mike Leung’s and my new Facebook theme page, I give the quotes from the classical apologists for voluntary slavery contracts and voluntary non-democratic constitutions (pacts of subject-ion) that form the intellectual history behind the classical liberal and libertarian view that the only basic requirement is consent (as opposed to coercion), so consent to such contracts is one form of permissible contractual arrangements. I also give a range of the quotes from the opposite inalienable rights tradition that descends from the Reformation and Enlightenment (with some anticipation in the Stoics) and that gives the critique of the alienable-rights tradition that finds its modern form in libertarian circles.
It is good to be aware of this inalienable rights tradition (almost entirely ignored in liberal intellectual history, e.g., in the history of the slavery debates) which seems to escape so many well-meaning modern liberals who “Like” the “free cities” rhetoric seemingly without understanding its roots in non-democratic thought.
But one might also be aware of the simple political economy behind these ideas. Political democracy, with one-person/one-vote, is the only real constraint on the total one-dollar/one-vote rule of wealth over society today. Hence the dream of many ultra-wealthy individuals and their foundations is to de-legitimize the whole idea of an inalienable right to democratic self-government in favor of applying the marketplace logic of free choice to political governance as well.
You prefer to give up your citizenship rights to be a subject of an enlightened ruler? Fine, that would be your free choice where there is a democratized choice of law, governance, and regulation in free cities and the like.
But the inalienable rights tradition has at least succeeded in removing the free choice of the voluntary slavery contract as well as the free choice of the people in any American city or town to alienate their rights of self-government to become a “free city” governed by, say, a private corporation. Another free choice that has been removed or abolished is the free choice of women to give up their legal personality in the old coverture marriage contract where “the husband and wive are one person in law, and that one person is the husband.” One wonders if all the libertarian thinkers have moral clarity (and guts)–as did Robert Nozick concerning the voluntary slavery contract and pactum subjectionis–to argue for the free choice today of the coverture marriage contract or perhaps the modern variant in Saudi Arabia. By their “logic of freedom,” the real problem in, say, the Saudi-style marriage contract is not the legal alienation of the rights of the woman (who goes from being a feme covert of her father to being a feme covert of her husband), but the lack of free choice in the marketplace of husbands and in the lack of free exit (when things go bad). May all the libertarian intellectuals in the right-wing think tanks and university institutes have the courage of their own convictions (and the convictions of their ultra-wealthy sponsors)!
While I am not really surprised at the arguments of right-wing libertarian thinkers, I am a little surprised at the well-meaning modern liberals (e.g., Paul Romer and others) who out of perfectly laudable concern for improving the lot of people in the developing countries are so willing to throw democracy under the libertarian bus.
If democracy leads to better social outcomes than does any other model of governance, then charter cities that implement effective democratic institutions will flourish and multiply, and less-democratic charter cities will lose their customers and soon find themselves under new management–namely, management by the developers of successful democratic charter cities.
I would hesitate to describe the right to cast a vote and attempt to solicit the favor of an electorate as the ‘right of self-governance.’ In the first place, the likelihood that your vote, or your opinion, will ‘govern’ is virtually zero. Your vote decides the outcome only if it breaks a tie, and in an election with tens of millions of voters, there will never be a tie. And likewise, even Pericles would be hard-pressed to sway the opinion of tens of millions of people.
In the second place, it is not you who is governed by the result of the election, but you along with the tens of millions of other people who share your democratic jurisdiction. So the ‘self’ in ‘self-governance’ is neither the one who governs nor the one who is governed; rather, the right to self-governance would be best characterized as the right to make a failed attempt to govern many other people. Needless to say, it is not clear that such a right has any value.
October 3, 2011 @ 7:20 am
@Allan Henderson. Congratulations on mastering the Econ 101 Logic of the Marketplace. By this logic, there is no need to abolish the voluntary slavery contract or the coverture marriage contract, since if alternative contracts have “better social outcomes,” then those contracts to alienate the rights of personhood would be outcompeted on the marketplace and would have very little uptake. Hence the consistent libertarian would argue, like Nozick, that such contracts should be permitted in a free libertarian society so people would have the full freedom of contract in the marketplace for alternative institutional forms.
October 3, 2011 @ 8:25 am
@David Ellerman,
I personally would use force to free a slave who no longer wanted to live in slavery, and I also think that there exist compelling self-interested reasons for communities (including charter cites) to organize their social institutions in such a way as to prohibit the use of coercion to keep people in slavery, or even, for that matter, to enforce any sort of shocking or onerous contractual obligation. I will happily elaborate if any of this is germane to your interests.
A person who moves from a democratic state to a non-democratic charter city is not asked to permanently relinquish her democratic rights. On the contrary, she may leave the charter city, return to her democratic state, and resume her participation in democratic politics at any time. Her circumstance is not much different from that of, for example, an American citizen who elects to teach English in Japan for a number of years, or even to vacation there for a number of weeks. At no time will she be allowed to vote upon the policies of the Japanese state, but we are not generally inclined to worry about this or to see it as morally problematic. To me, this is strong evidence that we correctly estimate the negligible value of our vote; by contrast, if there actually existed an American citizen whose vote had the power to enact policies that he liked, and to revoke policies that he disliked, he indeed might be faulted for choosing to live in a jurisdiction where he would be unable to enjoy the advantage and protection of those powers.
So rather than likening the resident of a non-democratic charter city to someone who has sold herself into irrevocable Nozickian slavery, it would be more accurate to compare her with a masochist who agrees to live as the slave of a master who sets her in chains, flogs her, employs her to do domestic chores, and so on, until such time as she says her ‘safe word’ and is released from his service. The rights she foregoes during her relationship with her master are far more substantive than those foregone by a resident of a non-democratic charter city—how many people would rather be bastinadoed in a dungeon than endure a disenfranchised holiday in Japan?—and yet, even so, liberals would not support the prohibition of consensual sadomasochistic relationships.
It seems to me that every form of interpersonal exchange entails what might be characterized as a temporary and voluntary nullification of certain personal rights that would otherwise be in force. I normally have the right of personal autonomy, but if I want you to employ me to move your furniture next week, I must be willing to hold that right in abeyance, as it were, and choose to follow some of your directions for a time, if I wish to receive your pay. I normally have the right to ridicule people, but if I wish to make friends, and remain friends with my friends, I must be willing to refrain from the exercise of my right to mock and insult them. If the residents of charter cities can be blamed for agreeing to a status quo in which they are not in a position to enjoy the unimpeded exercise of all their personal rights—in particular, the right to vote on the policies that apply within their jurisdiction of residence—then, a fortiori, thus must we blame everyone who lives in human society.
October 3, 2011 @ 7:00 pm
@Allan Henderson,
My main point is that classical liberalism and (right-wing) libertarianism see no moral necessity in democracy, and that it is one among a number of permissible voluntary governance arrangements. And you seem to fully agree, and are only arguing that there is nothing wrong with that.
Thus the disagreement is really over the question of there being inalienable rights (precisely the issue the Nozick had second thoughts about later in his life). The argument in the inalienable rights tradition is that the legal rights based on personhood should be inalienable since one cannot by a voluntary contract actually turn oneself into a non-person although historical legal systems recognized that certain performances, e.g., the voluntary slave registering consent or the coverture wife doing the same, as sufficient to treat them as if they had become non-persons. But you cannot in fact relinquish and nullify the responsibility for your decisions as is obvious if you modify your example to have one pretend to alienate decision-making responsibility in favor of helping another to steal someone else’s furniture. Then both “employer” and “employee” would be held legally responsible in view of the fact that they were both actually co-responsible. Unless you want to argue that employees actually turn into non-responsible instruments when the furniture being moved is legal, then you implicitly acknowledge the force of the inalienability argument.
Such arguments are not new to the Western tradition that descends from the Reformation and Enlightenment, but seem to be more or less completely unknown in the liberal/libertarian tradition–a tradition which is ably represented in your comments.
October 3, 2011 @ 8:37 pm