By Anthony de Jasay
Though this book leans on political philosophy, economics, and history, it leans on each lightly enough to remain accessible to the educated general reader, for whom it is mainly intended. Its central theme—how state and society interact to disappoint and render each other miserable—may concern a rather wide public among both governors and governed. Most of the arguments are straightforward enough not to require for their exposition the rigour and the technical apparatus that only academic audiences can be expected to endure, let alone to enjoy…. [From the Preface]
First Pub. Date
Indianapolis, IN: Liberty Fund, Inc.
The text of this edition is under copyright. Picture courtesy of the author.
- Authors Note
- 1.1 Violence, Obedience, Preference
- 1.2 Title and Contract
- 1.3 The Contours of the Minimal State
- 1.4 If States Did Not Exist, Should They Be Invented
- 1.5 Inventing the State: The Social Contract
- 1.6 Inventing the State: The Instrument of Class Rule
- 1.7 Closing the Loop by False Consciousness
- 2.1 Repression, Legitimacy and Consent
- 2.2 Taking Sides
- 2.3 Tinker's Licence
- 2.4 The Revealed Preference of Governments
- 2.5 Interpersonal Justice
- 2.6 Unintended Effects of Producing Interpersonal Utility and Justice
- 3.1 Liberalism and Democracy
- 3.2 Through Equality to Utility
- 3.3 How Justice Overrides Contracts
- 3.4 Egalitarianism as Prudence
- 3.5 Love of Symmetry
- 3.6 Envy
- 4.1 Fixed Constitutions
- 4.2 Buying Consent
- 4.3 Addictive Redistribution
- 4.4 Rising Prices
- 4.5 Churning
- 4.5 Towards a Theory of the State
- 5.1 What Is to Be Done
- 5.2 The State as Class
- 5.3 On the Plantation
2. The Adversary State
The rise of partisan democracy in the nineteenth century served to build both mass consent and a bigger and cleverer state apparatus.
In a republic of teachers, the capitalist ends up as the political underdog.
The foundations of the lay Western welfare state were probably laid in England’s 1834 Poor Law, not because it was particularly good for the welfare of the poor (it was in fact bad in that it abolished outdoor relief) but because, at the same time as concerning itself with the poor, the state transferred the larger part of the administrative responsibility for them from the dilettante and independent local authorities to its own professionals in what was then starting to take shape as the civil service. The foremost author and promoter of this scheme of building state muscle and governing capacity was the great practical utilitarian Edwin Chadwick, without whose intense drive much of the intervention of the English central government in social affairs might have taken place several decades later than it did. However, there he was, his zeal speeding up historical inevitability by twenty years or so, clearly recognizing that if the state is effectively to promote a good cause, it must not rely on the goodwill of independent intermediaries whom it does not control.
*55 When subsequently he addressed his energies to public health, he obtained the creation of the General Board of Health with himself as its first Commissioner, only to have the Board peter out on his retirement in 1854, demonstrating how much depended, at that incipient stage of historical inevitability, on the commitment of a single individual. It was not till 1875 that the state got round to re-creating an administrative body in the Public Health Act and in doing so, incidentally committing “the largest invasion of property rights in the nineteenth century.”
*56 It is surprising, in view of the authority the state was acquiring over the subject in other areas of social life, that education remained facultative until 1880.
On a lower level of eminence than Chadwick, the inspectors created by the first Factory Acts had a somewhat analogous role as spearheads, at one and the same time, of social reform and of the aggrandizement of the state apparatus. In supervising the observance of the successive Factory Acts, they in perfect good faith kept finding further social problems for the state to solve. As these problems were in turn tackled, they found that as an incidental by-product, their own authority and the number of their subordinates had also increased. There was, in fact, a first major wave of expansion of the state’s concerns and, parallel with it, of its apparatus, from the Reform Act of 1832 to 1848, as if meant to secure the allegiance of the new voters; then followed a relative lull from 1849 to 1859, coinciding with the decade of conservative reaction on the Continent; and a rush of increasing activism ever since.
It has been estimated that over the period from 1850 to 1890 the number of British government employees grew by about 100 per cent and from 1890 to 1950 by another 1000 per cent; public expenditure in the nineteenth century averaged about 13 per cent of GNP, after 1920 it never fell below 24 per cent, after 1946 it was never less than 36 per cent and in our day it is, of course, just below or just above the half-way mark depending on how we count public expenditure.
*57 Statistical series over longish periods are rightly mistrusted because their context is liable to change in important ways. For similar reasons of non-comparable contexts, international statistical comparisons, say, of GNPs absorbed in public sector consumption and transfers, should be treated with some reserve. Nevertheless, where the relative numbers show vast differences either over time or between nations, one can safely draw at least the modest conclusion that government in England in the last century and a half increased several times over, or that among the major industrial countries, no government leaves as much of GNP for private purposes as the Japanese. It is perhaps appropriate at this point to recall again Walpole’s lack of governing zeal and relate it to the fact that his government had all of 17,000 employees, four-fifths of them engaged in the raising of the revenue.
I will not deal a second time with the irrefutable dialectic argument that when in a situation of conflicting class interests the state sides with the working class, it is
really siding with the capitalist class, for whoever has at his command the invincible adjective “real” must win any controversy over this, as over anything else. I merely note that in areas of possible concern which the earlier English state (the Hanoverian even more resolutely than its Stuart predecessor) largely ignored, the nineteenth century saw public policy playing an increasing role which was at least
prima facie favourable to the many, the poor and the helpless. The passage from the state’s absence and unconcern to its progressive predominance had (in part predictable) consequences for the freedom of contract, the autonomy of capital and how people came to view their responsibility for their own fate.
At least in the early part of the century, the anti-capitalist drift of the reform movement certainly did not come from some clever calculation on the part of the state that there was more support to be gained on the “left” than lost on the “right.” In terms of the pre-1832 electoral arithmetic, this would have been dubious reckoning anyway. Up to the 1885 electoral reform if not beyond it, the main political benefit of taking sides with the labouring poor was derived not from getting
their votes, but those of the progressive professional middle class. The earliest pro-labour legislation pleased above all the squirearchy and beyond it those magnates who particularly despised the money-grubbing of the mill-owners and their unconcern for the welfare of the millhands and their families. Sadler, Oastler and Ashley (Lord Shaftesbury) were imbued with righteous animosity towards the manufacturers, Sadler’s 1831-2 Select Committee on Factory Children’s Labour producing one of the most virulent anti-industry tracts ever.
The capitalist defence was characteristically inept. With the passage of time, as and when state policy helped the poor at the expense of the rich, it was both to help the poor and to please some altruistic or envious third party—the concerned middle class reared on Philosophical Radicalism (and, once or twice, just a certain, inordinately influential Master of Balliol). Even when broad popular support became a more clearly recognized and avowed objective, the state may have often been pushed farther by articulate middle- and upper-class opinion than could be warranted by the tangible political advantage to be reaped from some progressive measure. “False consciousness,” a ready acceptance (bordering on gullibility) of what the articulate
say about the duty of the state in matters of social justice, was seldom absent from tentative forecasts of political profit and loss. Perhaps the most intriguing feature of the relatively quick transformation of the near-minimal Georgian state into a Victorian partisan democracy, an adversary of capital, endowing itself with an autonomous bureaucracy (albeit to a more moderate extent than many other states that were, for various reasons, more powerful and autonomous to begin with), is the mute defeatism with which the capitalist class, instead of drawing confidence from the dominant ideology of the age as it was supposed to do, submitted to the role of political underdog, contenting itself with making good money. Germany had Humboldt, France had Tocqueville to think and express the thoughts that were becoming urgent about the proper limits of the state and the awesome implications of popular sovereignty. England had only Cobden, Bright and Herbert Spencer in this camp. Her major thinkers, in keeping with the utilitarian tradition, in fact prepared the ideological foundations of the adversary state. (Historical circumstance, which gave Jacobinism to France and an adulation of the nation state to Germany, was admittedly much less kind to statism in England, where its ideologists had a relatively hard row to hoe till the last third or so of the century.) Mill, despite his ringing phrases in
On Liberty, his mistrust of universal franchise and his dislike of the invasion of liberty by popular government, had no doctrine of restraint upon the state. His pragmatism strongly pulled him the other way. For him, state intervention involving the violation of personal liberties and (to the extent that these are distinct) property rights, was always bad except when it was good. True to his broad utilitarian streak, he was content to judge the actions of the state “on their merits,” case by case.
The doctrinal impotence of the capitalist interest is nicely illustrated by the course of labour law. English law regarding trade unions went round full circle between 1834 and 1906, from forbidding combinations to restrain competition in both the supply of and the demand for labour, to ultimately legalizing combinations to restrain supply and also exempting them from having to keep contracts when it was inconvenient to do so. Much the same effect favourable to labour could have been achieved in less provocative ways. Violating the principle of equality before the law between capital and labour was, one might have thought, asking for it. Yet there was no worth-while doctrinal capitalist counter-attack, no appeal to first principles, nor to the as-yet uncontested verities of political economy.
The English state, twice almost disarmed
vis-à-vis civil society in 1641 and 1688, regained its predominance over private interest on the back of social reform, accomplishing its partisan anti-capitalist turn tentatively and gradually over nearly a century. In Continental Europe, civil society never disarmed the state which remained powerful, in governing apparatus and repressive capacity, even where it was standing on clay feet. The anti-capitalist turn as a means of building a base of consent, came rather later in these countries, but it was accomplished more rapidly. The watershed years when capitalism became the political underdog (though very much the top dog financially, becoming acceptable socially and still capable, in the case of such eminences as the Pereira brothers, the James de Rothschilds, the Bleichröders or the J. P. Morgans, to bend back the state to serve capitalist purposes), were either side of 1859 in France, 1862 in the North German Federation and 1900 in the USA.
It was roughly in 1859 that Napoleon III, in his own eyes a man of the left, began really to rely on the Assembly and to practise the rudiments of parliamentary democracy, and of a particular sort at that: for Guizot and Odilon Barrot were gone from the scene, to be replaced by such men of the radical left as Jules Favre, Jules Ferry and Gambetta, with only the “despicable Thiers” representing continuity of an unlovely kind with the bourgeois monarchy. Striking became legal in 1864 and a proper charter for labour unions, with fringe measures ranging from workers’ pensions to price control on bread, was legislated in 1867, Napoleon III taking a sympathetic interest in the encouragement of trade unions. Perhaps coincidentally with his shift toward the politics of consent, he showed a fine disregard for the capitalist interest in throwing open the French iron and steel, engineering and textile industries to the more efficient English and Belgian competition. Sharing the widespread illusion that a nation of shopkeepers will pay for a commercial good turn with such political support as he needed for his transalpine ambitions, in late 1859 he sent Chevalier, an ex-professor of economics with the free-trade convictions that such a calling tends to engender, to Cobden in London; it took the two kindred spirits an hour to negotiate a whole new free-trader tariff, to the furious surprise both of the Minister of Finance and the manufacturers concerned. Though perhaps of no more than anecdotal interest (anyone with a little acquaintance with tariff negotiations can at least smile at the story), the incident is characteristic of the respect the French state had, then as ever, for the interests of its industrialists.
Another facet of the adversary state which started to matter under the Second Empire and became very important in the Third Republic, was the autonomous evolution of the bureaucracy. The French professional civil service, built by the labours of Colbert, Louvois, Machault, Maupeou and, in unbroken continuity, by Napoleon, was at first closely entwined with property and enterprise, both because of the negotiability and (initially) relatively high capital value of offices, and of the dual role most of the civil service dynasties played in the royal administration and in the chief capitalist trades of the time, army contracting and tax farming. At the fall of the July Monarchy, in 1848, a regime which was less ambitious than most to dominate society, the civil service was more powerful than ever and, of course, more numerous (Marx noted, as a significant element in his characterization of the Second Empire, that there were 500,000 bureaucrats smothering civil society in addition to 500,000 soldiers), but no longer had much of a proprietorial stake in French industry and little property in general. The estrangement between capital and the bureaucracy was further accentuated in the Third Republic. While the top layer of the civil service was certainly upper-class (to Gambetta’s indignation) and continued to be dynastic, such property as it had was mainly in
rentes, and it had no understanding of, nor common interest with, entrepreneurial capitalism.
Moreover, when in 1906 the emoluments of a
député were nearly doubled, the profession of legislator became overnight quite attractive as a living. Till then, whatever was the social and economic background of the civil service, at least on the legislative side, capital, industry and land were strongly represented. From then onward, however, the republic of
notables rapidly became, in Thibaudet’s oft-cited phrase, a “republic of teachers” which, to judge by the occupational backgrounds of successive French legislatures, it has remained ever since.
Unlike France, Germany did not have its “bourgeois” revolution (not that it is altogether evident how its history would have been different if it had). Nor did it have its July Monarchy, cheering on the German bourgeoisie to enrich themselves, though (despite their late start around the mid-century) they did not fail to do so for all that. Under the romantic anti-capitalism of Frederick William IV (i.e. till 1858), the Prussian state, while resisting the national liberal ideas imported from the Rhineland, nonetheless cleared up much of the administrative clutter and pointless interference which used to encumber enterprise. This relative economic liberalism was an (albeit minor) enabling cause of the spate of new enterprise which characterized the 1850s. When Bismarck gained the highest office in 1862, the National Liberals had definitely to give up any serious hope of shaping state policy. If it is not too crude to regard them as the party of capital, one can say that their subsequent conduct really signified the acceptance by the capitalist interest of a politically quite subordinate role.
Both directly, and indirectly by harnessing William I’s obsession with the army, Bismarck ensured that absolute priority be given to all-German and foreign affairs, almost regardless of the consequent tax burden on industry. The schematic explanation of his freedom of manoeuvre is, of course, his ably managed truce, at times amounting to a downright alliance, with the mainstream of the Social Democrats. A simple, but not for that reason wrong, way to grasp Bismarck’s policy is that his remarkably advanced social security and welfare legislation was the price he compelled German capital to pay, to have the domestic calm and consent
he needed for the effective pursuit of
his priority objectives in foreign policy. The latter was of mixed benefit to German industry and finance. Perhaps more accurately, one might judge that German manufacturing, technically and commercially riding the crest of the wave, could have derived some benefit from almost any feasible foreign policy of passable competence and continuity, whether active or passive, at least as long as it produced the German customs union. It did not really need more to prosper. Achieving much more than that in foreign policy probably cost it more than it was worth.
Bismarck’s fundamental bargain with a vital part of the socialist left and the fiscal exigencies of his foreign policy, however, were not the sole causes of the Prussian state, and later the Second Reich, turning a stern mien to capital. Another reason was the intellectual grip which
Kathedersozialismus (“socialism of the professorial chair” and “teachers’ socialism” seem equally inadequate renderings)—took upon some of the most ambitious and devoted elements in the civil service, both through formal education and through the influence of the research done within the
Verein für Sozialpolitik. If this
Verein was more potent, and won its influence sooner, than the Fabians in Britain, its greater initial impact on legislation and regulation was in large part due to the excellence and policy-making latitude of the German civil service. It had a strong tradition, going back to Stein, of not only
serving but of actually
defining, interpreting the good of the state, and no false modesty about “merely executing” the will of its political masters. If we remember, in addition, that it tended to have little or no fortune and its family roots were mainly in the austere East while those of the representative German capitalist were more to the West or North, we have enough elements for appreciating the Reich’s adversary relationship to capital in the era of its greatest organizational and technical success. The breach with Russia, William II’s febrile foreign policy and the collision with France and England in 1914 were the culmination of a half-century of policy choices, rational and competently executed at the outset and progressively less so as time went by, in which the narrower interests of German capital were unhesitatingly sacrificed to the state’s own conception of the global national good. This was accomplished with the support of the bulk of social democracy and the labour union movement.
The reason, if ever there is a good reason for trying precisely to date historical turnings, for calling Theodore Roosevelt’s accession to the Presidency the start of the adversary relation between American government and capital, is mainly that any earlier starting date would include the McKinley years at the White House, about the most obvious antithesis to the thesis I am putting forward. The McKinley-William Jennings Bryan contest was the last time that money alone, against all odds, could get its candidate elected. The closing years of the nineteenth century saw the executive power of the state depending for support, in a way never since seen, on the capitalist interest rather than on the popular appeal of its conduct of affairs. The political colour of Theodore Roosevelt’s two terms is all the more of a contrast. His anti-trust, anti-railroad and anti-utility accomplishment is as wide by past standards as it is puny by those of most of his successors. It may be true that his bark was more fierce than his bite, that his true element was demagogy rather than unostentatious achievement, and that his administration in fact represented less of a populist and pro-union tilt, less of a stealing of the Democrats’ clothes, than one would judge from its bluster. However, his bark was in the short run perhaps as effective as any bite could have been, to put distance between himself and big business in the eye of the public and to mobilize national support for his purposes.
It is probably fair to say that there has never been an American administration which did not almost exclusively rely on consent to get itself obeyed, unlike some British and Continental European regimes which did not rely on it or did so only a little. Lincoln’s administration, having to take on in civil war the minority, might not otherwise have retained the consent of the majority (which is precisely Acton’s point about the potentially tragic implications of democracy in a non-homogeneous society). Consent was either votes or clout. Champions of the people tended to rely directly on votes. Others relied in the first place on the clout of those concentrations of private power, be they men or organizations, which stand between the state and the amorphous mass of the citizenry and provide society with structure.
*59 The alternance between the two types of organizing consent, the direct and the indirect, used to play much the same role in American political life as did (and do) the alternance of ideologically marked tendencies, conservative and progressive, Christian and lay, monarchist and republican parties in other societies. With Theodore Roosevelt, alternance in this sense ended in the USA; two parties subsist but both have become champions of the people. If one is less of an adversary of capital and readier to make use of sheer clout than the other, the difference is but of slight degree, especially as clout is no longer well correlated with capital.
The American example, where material inequalities were for a long period more admired than resented and rich-to-poor and rich-to-middle-class redistribution has only recently become the central tool of consent-building, lends itself poorly to clarifying the relation of consent by vote to consent by clout. Take instead any “country” which is perfectly repressive to begin with, say a concentration camp. For its successful functioning according to the purposes of its commandant, the allegiance or support of its cowed and emaciated inmates is immaterial, no matter how numerous they are; that of the less numerous band of well-fed trusties is relatively more important; and that of the handful of well-armed guards is essential. Even if he could, the camp commandant would be ill-advised to try and win over the inmates by promising to give them the guards’ rations. The subset of camp society containing the commandant and the guards is essentially a pure electoral democracy in that, with all the guards about equally well armed, the commandant must find the support of a majority of them, and it is the headcount that matters (even if there is no formal voting). If a larger subset including the trusties were carved out, the greater clout of the guards would have to be used to sway the “vote” of the trusties and secure the consent of their majority to the commandant’s way of running the camp. The implicit threat of throwing dissenters to the inmates would normally suffice. If, for some reason, the democratic subset were to be further enlarged and the rule of consent extended to the inmates, they would have to be divided and the support of one part obtained (if that was at all possible) by promising them the rations of another part. The less the clout of the guards and trusties or the less use one could make of it, the more the whole camp would approximate pure electoral democracy giving consent by headcount, with the majority getting the minority’s rations.
It seems to be a strange confusion, and one suffered by many states no less than by their subjects, to want to have the state rely on consent
and to be everybody’s state, standing above classes and group interests, beholden to no group and impartially realizing its conception of society’s greatest good.
When the state takes sides, not only is it building the required base of consent. Perhaps unconsciously and unwittingly, it is also “learning by doing.” With every measure it takes to favour a subject or group of subjects, to modify the system of rewards and obligations which derives from past custom or voluntary contracts, to change social and economic arrangements that would prevail but for its intervention, it acquires more knowledge of its subjects’ affairs, a better and bigger administrative apparatus and, hence, an added capacity both to imagine and to carry out further measures. Two channels of unanticipated causation are dug in this manner, and end by forming a self-sustaining circuit. One leads from intervention to capacity for intervention, as physical labour leads to bigger muscle. The other leads from a larger state apparatus to an altered balance of interests in society, tilted in favour of more state intervention; for by self-aggrandizement the state increases the activist constituency.
These channels run
within the state apparatus and not
between it and civil society. Another and probably more potent circuit runs from state benefactions to a condition of dependence or addiction
in civil society, calling for further benefactions. It is easier to grasp the mechanics of such circuits than to have confidence in their stability, in the capacity of built-in regulators ultimately to prevent them from getting out of control.
Party Politics, 1962, vol. III, p. 412.
The Growth of Government, 1979, p. 2.
Encounter, Jan. 1981). If so, the democratic drive (noted by Tocqueville) to break down structure, bypass intermediaries and appeal to one-man-one-vote, and the socialist drive to abolish private ownership of capital, are more closely related than is apparent.