1. The Capitalist State
The Contours of the Minimal State
Indifference to the satisfactions of governing gives rise to self-imposed limits on the scope of the state.
It is strange but not patently irrational for the state to minimize itself.
A theory, or at least an approximative definition, of the capitalist state, which requires it to respect the freedom of two parties to enter into contracts that do not violate the rights of a third, looks incomplete, as is—by customary standards—the state in question. For what are the third-party rights which the state ought to protect and what are mere pretensions which it ought to ignore? There is a virtually limitless list of potential claims which third parties could make against the terms of a given contract. Laws must be made and administered both to define the category of claims that shall be treated as justified and to reduce the area of doubt (and hence of arbitrariness) between those that shall and those that shall not be so treated. Once there is a state, it is incumbent upon it to deal with these tasks.
There is some presumption that in the state of nature a spontaneous cooperative arrangement would arise and fulfil this function, for the same general reasons which let us suppose that other functions habitually regarded as proper to the state would also be looked after, though there is neither a certitude that they would be nor a definition of the particular shape they would take. Once a state is formed, however, at least some of these non-coercive arrangements are liable to become unworkable and may, indeed, be impossible to bring about in the first place. In the state of nature, anyone disliking the way a voluntary arrangement is working, has only two choices: to accept the way it works, or to bargain for its amendment, a breakdown in bargaining carrying the danger of the whole arrangement breaking down and its benefits being lost.*15 The risk of such an outcome provides some incentive for everyone to keep things going by reciprocal accommodation.
In the presence of a state, however, the dissident member of a voluntary arrangement has an added reason to be intransigent (and the other members an added reason to call his bluff), i.e. the faculty of recourse to the state. If he cannot get his way, he can still appeal to the state to uphold the justice of his case, and so can the other cooperators. Whoever wins, the voluntary arrangement is transformed into a coerced one. Turned upside down, this is the same logic as the one in Kant's argument about the subject's right to disagree with the sovereign. If there were such a right (which Kant denies), there would have to be an arbiter to whom the disagreement could be referred. The sovereign would then cease to be the sovereign, and the arbiter would take his place. Conversely, if there is a sovereign he will get disagreements referred to him, for there is less reason to yield in private compromise if an instance of appeal exists. What the state must do, to make its life and that of its less litigious subjects tolerable, is to lay down as clearly as possible the laws predicting how it would rule if cases of a given description were appealed to it (thus warding off many appeals), as well as a general description of the cases in which it would not hear an appeal at all.*16
Admitting, then, that if the state exists at all, it will somehow or other assume the task of sorting out disputes arising out of third-party claims, what are the guidelines the capitalist state would adopt for doing so while still remaining capitalist, an upholder of the freedom of contract? There is no question of drawing up a design, a sort of code capitaliste for the laws of such a state, the less so as it is reasonable to believe that more than one such code, containing significant variations on the same themes, could each be consistent with the basic capitalist conditions relating to unconditional property and free contract. Perhaps the most economical way of grasping the spirit common to all such possible codes, is to consider that if there is a state (which is not the same as claiming that there could really be one) which is prepared to agree to these basic conditions, it must be one which finds its satisfactions elsewhere than in governing.
Such a statement may look obscure and require a little elaboration. When we reflect about choice, we incline at least tacitly to suppose that "behind" the choice there is a purpose, an end. It used even to be said, for instance, that consumers seek satisfaction and producers seek profit, and their choices can be thought of as rational (or not) in terms of a corresponding maximization assumption. But what end or ends does the state pursue, the maximization of what can qualify its conduct as rational? Various answers of varying degrees of sincerity and seriousness could be proposed: the sum of the satisfactions of its citizens, the well-being of a particular class, the gross national product, the might and glory of the nation, the state budget, taxes, order and symmetry, the security of its own tenure of power, etc. (I address the question more seriously on pp. 267-70.) The likely maximands all seem on closer scrutiny to require that the state possess some specialized capacity, equipment to attain them. In addition, greater rather than lesser capacity looks desirable for guiding the course of events, dominating the environment, and actively working upon the maximand (increasing the pay-off, e.g. enlarging the dominion rather than merely the power over a given dominion). Even if there are maximands which do not require a vast capacity to act for their attainment—unworldly objectives like, say, the peaceful observation of rare butterflies—would it not be pointless for the state pursuing them, voluntarily to bind its hands and renounce in advance the use of a fully-fledged apparatus for exercising power, of the richest possible set of "policy tools"? Might they not come in handy one day?
My definition of the capitalist state, however, requires it to opt for a sort of unilateral disarmament, for a self-denying ordinance concerning the property of its subjects and their freedom to negotiate contracts with each other. A state whose objectives needed, for their realization, a strong capacity to govern, would not willingly adopt such a self-denying ordinance. This is the sense in which we say that the ends of the capitalist state, whatever they are (we need not even seek to find their particular content) lie outside government.
What, then, is the point for the state in being a state? If it finds its satisfaction in what we could term "metagovernmental" maximands, rare butterflies or plain peace and quiet, why not resign and stop governing? The only plausible answer that suggests itself is to keep them out, to stop them from getting hold of the levers of the state and spoiling it, the butterflies, the peace and all. The very special rationale of being a minimal state is to leave few levers for the zealots to get hold of and upset things with if, by the perversity of fate or of the electorate, they manage to become the state.
Inheriting a strong, centralized state apparatus is part of the secret of the successes both of the Jacobin terror and of Bonaparte. In what are, perhaps, the climactic passages of L'ancien régime et la révolution (Book III, ch. VIII), Tocqueville blames the pre-revolutionary French state for having set over everyone the government as "preceptor, guardian and, if need be, oppressor," and for having created "prodigious facilities," a set of egalitarian institutions lending themselves to despotic use, which the new absolutism found, all ready and serviceable, among the debris of the old.
Marx, too, is perfectly clear about the value to the revolution of the "enormous bureaucratic and military organization, with its ingenious state machinery" put in place by the regime it had overthrown. "This appalling parasitic body, which enmeshes the body of French society like a net and chokes all its pores, sprang up in the days of the absolute monarchy.... The seignorial privileges of the landowners and towns became transformed into so many attributes of the state power.... The first French Revolution... was bound to develop what the absolute monarchy had begun: centralization, but at the same time the extent, the attributes and the agents of governmental power. Napoleon perfected this state machinery."*17 Thus, it is not the state that mistrusts itself and would rather not have levers or powerful tools lest it should misuse them. It knows that it could not possibly be tempted to misuse power. It is its rivals for state power who would, by the nature of their ambition, misuse it. (The minimal state may even be aware that if it was succeeded by a rival with contestable ends in mind, the latter would need but a little time to put in place the rudiments of an apparatus of non-minimal government. However, even gaining a little time, and hence hope, would be better than handing it a ready-made system of pulleys and levers.) Seeking, as it does, aims which positive government is incapable of promoting, and fearing its capacity for wrong-doing in profane hands, the capitalist state is rational in adopting the contours of the minimal state.
Recalling the regimes of Walpole, Metternich, Melbourne or Louis Philippe (only more so), with a blend of indifference, benign neglect and a liking for amenities and comforts, the capitalist state must have sufficient hauteur not to want to be bothered by petty disputes among its subjects. The more quietly they get on with their business, the better, and it may occasionally, and a little reluctantly, use a heavy hand to make them do so. Its distance from the mundane concerns of its subjects does not, on the other hand, imply the sort of heroic hauteur which a Nietzsche or a Treitschke wished to find in the state, which reaches out for some high purpose, risking in avoidable war the life and property of the subject; nor the hauteur of utilitarian ethics, which sees the subject and his property as legitimate means to a greater common good. In a seeming paradox, the capitalist state is aristocratic because remote, yet with enough bourgeois overtones to recall the governments of the July Monarchy of 1830-48 in France. At any event, it is a state which is very unlikely to be a republic. As a digression, it is worth remembering, though it may not prove much, that Alexander Hamilton was a convinced royalist. His is a good example of how little the essence of capitalism is understood by the public. If people were asked who was the most capitalist American statesman, some may be tempted to say "Grant" and think of railroad land grants, "Garfield" and think of the Gilded Age, perhaps "McKinley" and think of Mark Hanna and tariffs, "Harding" and the Teapot Dome scandal and the Ohio Gang. Such answers miss the point. These Presidents caused or condoned corruption and scandal by favouring some interests over others, which means using state power for their ends. If any American statesman was good for capitalism, which is not evident, it was Alexander Hamilton.
Such a state, then, will make few and simple laws and not enforce many of the laws it may have inherited. It will make it clear that it dislikes adjudicating claims against established situations resulting from people's freely negotiated contracts, will do so gingerly if it must but only as a last resort.
It will be reluctant to promote the good of society, let alone to order the more fortunate of its subjects to share their good fortune with the less fortunate, not because it lacks compassion, but because it does not consider that having creditable and honourable feelings entitles the state to coerce its subjects into indulging them. We must leave it at that, and not try to find out (nor could we if we tried) whether it is "belief in laissez faire" or some other, more subtle conviction about the proper role of the state which is holding it back, or simply indifference to the satisfactions that may be found beyond the limits of the minimal state.
Notes for this chapter
This assumes that the arrangement requires unanimity. If it does not, and the arrangement continues to produce its benefits after the withdrawal of the person who failed to get his way in bargaining, the well-known free-rider problem arises and might destabilize the arrangement. If the non-cooperator benefits as well as the cooperators, an incentive is created for the latter to defect. As each successive cooperator becomes a free rider, ever fewer cooperators carry ever-more free riders and the incentive to defect keeps increasing. Various devices, some practicable in some situations and others in others, can be conceived to hinder this outcome and give the arrangement some stability. (Cf. pp. 237-39.)
The reader will have spotted that while one type of state would have an interest in proceeding as above, other types of state might want to do the precise opposite, to make their subjects appeal to them as frequently as possible; this may well coincide with the interest and the perhaps-unconscious wish of the legal profession. Laws breed lawyers who, in turn, breed laws.
K. Marx, "The Eighteenth Brumaire of Louis Bonaparte," in K. Marx and F. Engels, Selected Works in One Volume, 1968, p. 169.
End of Notes
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