In his 1954 lecture ‘What does the economist economise?’, Dennis Robertson writes:

There exists in every human breast an inevitable state of tension between the aggressive and acquisitive instincts and the instincts of benevolence and self-sacrifice. It is for the preacher, lay or clerical, to inculcate the ultimate duty of subordinating the former to the latter. It is the humbler, and often the invidious, role of the economist to help, so far as he can, in reducing the preacher’s task to manageable dimensions. It is his function to emit a warning bark if he sees courses of action being advocated or pursued which will increase unnecessarily the inevitable tension between self-interest and public duty; and to wag his tail in approval of courses of action which will tend to keep the tension low and tolerable.

This passage is approvingly quoted in Part One of Buchanan and Tullock’s ‘The calculus of consent’. And this basic idea informs much of public choice theory – a branch of economics and political science that uses tools often associated with microeconomics to analyse political decision-making. Slightly more specifically, public choice theory often focuses on the ways in which political decision-makers’ individual interests and incentive structures influence their policy-making, frequently to the detriment of ‘the public good’. In Buchanan’s words, in his 1986 Nobel lecture:

Economists should cease proffering policy advice as if they were employed by a benevolent despot, and they should look to the structure within which political decisions are made.

As Robertson says, the idea here is not that altruistic acts are in some way incompatible with human nature; it is, rather, that an institutional structure that heavily relies on altruistic acts for its ongoing stability is likely to be more fragile, all else equal, than an institution that accommodates less noble motives as a major component of its day-to-day functioning. Acts of heroism, kindness, self-sacrifice, selflessness – these are, contrary to more pessimistic views of ‘human nature’, extremely widespread. But a political-economic institution that relies upon these facets of human nature for its day-to-day reproduction, and that will quickly fall apart in their absence – such an institution is at constant risk of either collapse, or transformation into an institution that does accommodate less noble elements of human behaviour, perhaps to the detriment of its intended or apparent goals.

This ‘pessimistic’ public choice vision of political-economic institutions has often not found favour on the left. Leftist critics of public choice theory – or of the broader liberal tradition of which it is apart – tend to object both to its methodological individualism, and to the kind of ‘human nature’ that is tacitly or overtly ascribed to the individuals it considers. For many leftists, furthermore, the public choice approach to political economy is less an analysis of the pitfalls of collective action, than it is an attempt to undermine or attack successful collective action, in the service of right-wing, anti-statist interests and policies. From this left perspective, public choice theorists attempt to emphasise the ways in which institutions of collective action are liable to fail, because public choice theorists want such institutions to fail: by arguing that the successful collective provision of social goods is difficult or impossible, and that apparently successful collective action is really a mask for individual self-interest, public choice theorists serve the interests of those opposed to emancipatory collective action.

There is much to be said for this left critique of public choice theory. Public choice theory has, indeed, typically emerged from and aligned itself with the right of the political spectrum, and sought to provide intellectual resources and arguments for those who wish to greatly reduce the size of the state and the scope of democratic or collective social decision-making. It is, primarily, a conservative school of thought, and much of the public choice tradition cannot usefully be interpreted unless its analysis is seen as informed and shaped by conservative political commitments.

But should the tools of public choice theory be exclusively the property of the right? Does it benefit the left for this to be the case? In my view, the answer to these questions is ‘no’, and a ‘public choice theory of the left’ is a worthwhile project, no matter our views on ‘actually existing public choice theory’.

Why is this so? First of all, analytically speaking, there is a lot of potential common ground between public choice theory and traditional left critical analysis: the capture of powerful institutions by special interest groups and the use of power to advance the interests of those with power, as against the broader public good… they are not themes that are entirely alien to left analysis. Public choice approaches should be capable of use for left critique.

Secondly, though, the normative public choice critique of would-be emancipatory collective action also carries weight: the left ought to reckon with this category of critique of its own projects and institutions. Public choice theory is suspicious that institutions – paradigmatically state institutions – that are intended to serve the common good have a tendency to serve instead the interests of those who wield power within those institutions. If left politics aspires to create institutions that are not disastrously vulnerable to this phenomenon, it needs to reckon with this risk and this critique. Moreover, it needs (I would argue) to reckon with this critique in a way that does not appeal to unrealistically utopian claims about long-term selfless action on the part of key social actors.

Perhaps the paradigmatic case here is Soviet communism. For many critics of the USSR, the Bolshevik project was intrinsically flawed because the institutions it proposed and implemented in the name of emancipation were always likely to result instead in state power serving the interests of a governing elite rather than the broader citizenry. Of course, there are many on the left who reject this analysis. But there are also many on the left – including me – who agree that Soviet-style communism was in practice a novel form of domination and oppression rather than a fundamentally emancipatory project. And this judgement raises the question of how to evaluate leftist transformative proposals, to ensure that would-be emancipatory institutions are likely to genuinely be emancipatory.

In my post on Erik Olin Wright’s ‘Envisioning Real Utopias’, I discussed one leftist response to this problem: Wright’s centring of ‘social power’ (as against state power) as the ‘true north’ that should guide ‘the socialist compass’. I argued, against Wright, that there is in fact no reason to believe that ‘social power’ is intrinsically more emancipatory than ‘state power’ or indeed ‘market power’ – that we need more fine-grained criteria for evaluating political-economic institutional proposals, to assess whether these proposals are likely to move us in a more or less emancipatory dimension.

The insight from Robertson with which I started this post, I believe, offers one such useful criterion (of course at a very high level of abstraction). As Robertson writes, we can distinguish between on the one hand institutions that, for their emancipatory functioning, require members of the institutions to persistently navigate a high tension between their own personal interests and those of the ‘public good’, and, on the other hand, institutions that reduce the tension between self-interest and public duty to a “low and tolerable” level. Institutions of the latter sort are, all else equal, more likely to be sustainable. The task for leftists is to construct institutions that are emancipatory in their outcomes and processes, while also exhibiting this feature.

In the jargon of game theory, this kind of institution design challenge is known as “incentive-compatible institution design”. That is to say: when we are constructing political-economic institutions, we want to construct those institutions in such a way that the incentives of individuals within the institutions are aligned with the tasks we would want those individuals to fulfill. In the maxim of many introductory economics courses: “incentives matter”.

This is a lesson that should be applicable across a broad range of categories of institutions. It should not be restricted to the political projects of the right, or to the critique of the left. And the left, I think, needs to get better at thinking about institutions in these terms. Paying closer attention to public choice theory is perhaps one route via which that could be accomplished.

I’ve talked on this blog before about three different concepts of liberty: negative liberty, in the sense of action unconstrained by others’ coercion; capabilities liberty, in the sense of possessing the material and social resources and capacities required to make use of one’s negative liberty; and positive liberty, in the sense of active participation in self-governance.

When I was taught political philosophy at an undergraduate level, I remember a lot of focus on liberty versus equality, with the idea that there was some trade-off between the two. Obviously one can value equality for itself – but I tend now to think that equality, at least in the sense of material equality, is mostly a derivative political virtue. The main reason we should value material equality, and the kinds of redistributive politics associated with it, is because of those policies’ impact on capabilities and positive liberty. Material redistribution increases capabilities liberty by directly increasing people’s material and social capabilities – destitution is a form of unfreedom, and redistributive policy therefore increases liberty in at least this sense. Moreover, at the other end of the material wealth spectrum, extremely high levels of wealth can be transformed into political power and influence, so reducing wealth inequality also reduces the inequality in forms of political voice and influence associated with wealth – which is in turn likely to increase the positive liberty of the non-wealthy. So: the major virtues of this kind of egalitarian policy can be derived from principles of liberty – and I think this is often a better way to think about the normative or political or ethical warrant for such policies than to simply value equality itself.

Similarly, I remember a lot of attention in my introductory political philosophy classes focusing on principles of political legitimacy, which were more often than not as I recall understood in democratic terms: a governance system only has legitimacy if it enjoys the endorsement of the governed, in some sense. Here, again, the principle of ‘positive liberty’ seems very similar indeed – so it seems like a lot of issues in normative political theory can ‘drop out’ of these basic ideas of liberty.

OK. So – if we are thinking about principles of institution-design in these terms, we are thinking in terms of trade-offs. We need to think of trade-offs between individuals: is it worth reducing my negative liberty to engage in some action, if that action also constrains the negative liberty of others? We also need to think of trade-offs between categories of liberty: is it worth risking a loss of negative liberty to make a gain in capabilities liberty, or vice versa? These two forms of trade-off seem to capture a lot – obviously by no means all, but a lot – of the normative problems we confront when thinking about political and political-economic institution design.

Continuing the institution-design thread on the blog, which I expect to be the dominant focus here for years to come…

I’m currently working through [Using the phrase “working through” is a trick I’ve picked up to make it sound like I’m doing something fancier than “reading”] Erik Olin Wright’s ‘Envisioning Real Utopias’, since the project I’m pursuing here seems to broadly fit within or alongside Wright’s. Wright characterises his work as an example of ‘emancipatory social science’, which he says in turn comprises three main tasks:

elaborating a systematic diagnosis and critique of the world as it exists; enivisioning viable alternatives; and understanding the obstacles, possibilities and dilemmas of transformation.

Moreover, although here Wright categorises ‘diagnosis and critique’ as one task, this can of course be broken down into very different component parts:

To describe a social arrangement as generating ‘harms’ is to infuse analysis with a moral judgement. Behind every emancipatory theory, therefore, there is an implicit theory of justice, some conception of what conditions would have to be met before the institutions of a society could be deemed just.

In this post I just want to focus (pretty superficially) on the relationship between this kind of political ideal – whether understood as a theory of justice or some other kind of normative framework – and an institutional proposal.

We evaluate institutions in terms of whether they realise our political ideals, so debates about which institutions we should adopt always play out in at least two registers: debates about what ideals they should try to realise, and debates about how they can best realise those ideals. These two debates intertwine. It is possible to bring together a coalition of very different political ideals under a shared institutional goal, and vice versa. It is also possible for our institutional goals to modify our political ideals.

As any very long-term readers of this blog, if such there be, may remember, I spent considerable time some years ago on the work of the analytic philosopher Robert Brandom, and in particular on Brandom’s normative pragmatics. I don’t want to revisit that fairly involved terrain here, but I want to highlight that the relationship between norms and practice is very relevant, at a metatheoretical level, to the normative study of institutions. Institutions are, after all, enacted by practices, and if we understand (as I think we should) norms as also products of practice (albeit in a complicated and non-reductive way), then we see that our norms are not just benchmarks against which institutions can be evaluated, but are also themselves, in part, products of our institutions. The institutional world we make shapes our values, and those values in turn react back on our institutions, and permit us to evaluate – and critique – them. For example: one of the ways in which capitalism is (potentially) self-undermining, for Marx, is not just that it creates the objective conditions for its abolition (for example, in creating productive forces that can be redirected to other ends), or even that it creates the subjective conditions for its abolition (in the sense of creating a ‘collective subject’ of a class-conscious proletariat) but just as importantly that it creates the subjective conditions for its abolition in another sense: the institutions of capitalism generate a range of historically novel normative ideals that provide resources for the emancipatory critique and rejection of capitalist institutions.

So the relationship between institutions and norms is complicated. It is a mistake, in an ‘abstract’ sense, to think that we begin with historically-abstracted norms and then move to devise institutions that can realise the ideals of those norms: our norms are a product of practice too, and may shift as our practices shift. Nevertheless, we do evaluate institutions against our norms, and in a less abstracted or philosophical sense it doesn’t matter much where those norms come from. After all, they are our norms – in our ethical and political debates we accept or reject them because of reasons, not simply causes.

So, to repeat, debates over institution design play out in two registers: debates over what ideals we should attempt to realise, and debates over what institutions we should adopt to attempt to realise those ideals. These debates are intertwined at an abstract metatheoretical level – but they are also intertwined at more ‘applied’ levels. One easy mistake to make, in ‘theoretical’ institution-design, is to think that one can begin with a set of foundational normative principles, and from these principles ‘derive’ the institutions that best realise them. This direction of political-theoretical reasoning is certainly one of the discursive and political resources at our disposal – but we need to be cautious. In practice our norms are complicated and conflictual, filled with competing preferences and values which need to be wrestled with to attempt to balance partially incompatible goods and goals. This kind of work cannot be carried out at the level of pure abstraction – it needs to be thought through in relation to concrete problems. Thinking about actual institutions is therefore important not only when we attempt to realise our political ideals, but also in order to understand what those ideals even are. Different people who share ‘the same’ values may find themselves with very different practical intuitions when confronting real-world political problems – and these practical problems therefore function to illuminate differences of values that might have been invisible, or at least difficult to discern, until they were tested.

One of the conclusions we could draw from this line of thought is the position discussed in my last blog post: the idea that politics can only really be carried out ‘in practice’, and that trying to theorise institutions (or anything else) in too much abstraction or too much in advance is hubristic. But, as I said in that post, I think we should reject this idea. The inseparability of theoretical ideals and practical problems should not lead us to reject the former – still less to reject theoretical attempts to provide resources for practical problem-solving. Nevertheless, it is useful to be aware of the ways in which these areas of theory, politics and experience intersect.

In short, in thinking about institutions, we should pursue both tasks: clarifying our political values, and clarifying our sense of what institutions can best realise those values. Moreover, for the reasons I have discussed in this post, it makes sense to ‘tack back and forth’ between these projects. To bastardise Kant, institutions without ideals are empty; ideals without institutions are blind. We will carry out both of these projects better, I think, if we keep them in close contact.