Market Perfection Tends to Monarchy, & Vice Versa

Market perfection requires internalization of all externalities, and enclosure of all commons (these are two different ways of saying the same thing). The last commons to be enclosed is the state. It must be owned, or all its operations will tend to social vitiation.

Realized market perfection entails feudal monarchy. As markets operate and seek the healing of their own failures, then, so will they tend toward feudalism – or, at least, in conditions of high trust and confidence, and of general competence, its cameralist approximate.

So long as the state is not owned, it will not want to internalize other externalities or enclose other commons. Why should it? So long as the state is not owned, it will not on its own account want to maximize the NPV of its revenues (e.g., the IRS does not collect taxes for itself, but for the Federal government – for everyone, ergo no one). Thus will it have no nisus that is its own, but will be rather in the service of those who can best game the existing system. It will be swayed by their special interests, rather than its own. They will be its hidden owners; it will be theirs, bought and paid for on the grey market, or the black, or in perfectly legal but corrupt, quid pro quo transactions (e.g., massive contributions to the Clinton Foundation).

Who has a personal fief wants it to prosper in good health. His personal interest and the general interest of his fief coterminate. And when these relations are explicit, public and well understood, his subjects will therefore feel no inclination to replace him, unless he fails as a lord, and their fortunes then suffer; for they too, like the sagacious and virtuous lord, will see that their interests are his.

A fief with no lord on the other hand is just prey. It is for that reason unstable, apt to devour itself, weak and vacillatory, riven with internal conflict and disagreement, timorous, vulnerable to conquest or capture by interests inimical to those of its denizens. This is so even when it is prosperous and powerful. A state that is not owned is ripe for the taking by someone who would be owner. Such states are bound to dissolution, or to ownership.

All these same sorts of bad things can happen in an owned state, too, of course; but only when its owner is inept or wicked or foolish – when, that is to say, it is owned by a lord who is not proper lord of himself.

The prudent lord wants all costs of his people’s business accounted for properly, and by them properly paid, so that he can himself reap revenues from fees, tolls, taxes, and tonlieux he earns on market transactions. The more that costs are internalized, thus controlled, the greater then the prosperity and size of the economy, and the greater his revenue base. Perfect monarchy, then, tends toward market perfection.

59 thoughts on “Market Perfection Tends to Monarchy, & Vice Versa

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  3. Hwæt! We Gar-Dena in gear-dagum
    þeod-cyninga, þrym gefrunon,
    hu ða æþelingas ellen fremedon!
    Oft Scyld Scefing sceaþena þreatum
    monegum mægþum meodo-setla ofteah;
    egsode eorl[as] syððan ærest wearð
    feasceaft funden; he þæs frofre gebad,
    weox under wolcnum, weorð-myndum þah,
    oðæt him æghwylc þara ymb-sittendra
    ofer hron-rade hyran scolde,
    gomban gyldan. Þæt wæs god cyning!

    Lo, praise of the prowess of people-kings
    of spear-armed Danes, in days long sped,
    we have heard, and what honor the athelings won!
    Oft Scyld the Scefing from squadroned foes,
    from many a tribe, the mead-bench tore,
    awing the earls. Since erst he lay
    friendless, a foundling, fate repaid him:
    for he waxed under welkin, in wealth he throve,
    till before him the folk, both far and near,
    who house by the whale-path, heard his mandate,
    gave him gifts: a good king he!

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  5. This of “market perfection” etc is precisely that sort of rationalism that previously gave us Marxism, libertarianism, objectivism and other such isms.
    Which monarchy in the real world shows any evidence or tendency towards “market perfection”?
    That State is something to be owned is absurd. That King owns the nation is historically false. The European kings owned some fiefs.

    • Kristor:All these same sorts of bad things can happen in an owned state, too, of course; but only when its owner is inept or wicked or foolish – when, that is to say, it is owned by a lord who is not proper lord of himself.

      vishmehr24:Which monarchy in the real world shows any evidence or tendency towards “market perfection”?

      For that matter, which monarchy in the real world shows/showed any evidence or tendency towards producing “a lord who is [] proper lord of himself”?

      Prince Charles is generally the best (future) monarch you can expect, and frequently they will be far worse.

      • Sure. But men being all sinners, this tells equally against all sorts of political order. There is no escape from it, as all utopian political schemes propose that they shall provide. All such proposals are delusory.

    • That State is something to be owned is absurd.

      It’s not. However, Kristor seems to be ignoring both the truth that the State can be owned corporately — and that just like a business corporation, it can be managed well or poorly — and that when the State is owned privately history shows that it is more likely to be run poorly than well.

      That King owns the nation is historically false. The European kings owned some fiefs.

      In feudal theory, the European kings owned everything. In English practice, William the Bastard owned everything, by “right of conquest”, and the British and American governments to this very day still claim to own everything.

      Whether one is a subject or a “citizen”, all one ever owns is the tax bill.

      • Kristor seems to be ignoring both the truth that the State can be owned corporately

        On the contrary:

        As markets operate and seek the healing of their own failures, then, so will they tend toward feudalism – or, at least, in conditions of high trust and confidence, and of general competence, its cameralist approximate.

        Cameralism is the nearest corporate approach to private ownership of the state.

        … and that just like a business corporation, it can be managed well or poorly …

        True of all human institutions.

        … and that when the State is owned privately history shows that it is more likely to be run poorly than well.

        Does history indeed show that? It sounds like another one of those proud shibboleths of Enlightened philosophes, such as that Christianity caused the Fall of Rome. Most polities through history have been privately owned. Why should thus be so if they are more likely to fail? If they are more likely to fail, how did we make it to the Enlightenment?

      • Does history indeed show that?

        It does, and you know it does … and I am no more willing-or-likely to give you a pass on playing stupid than I am someone whom I don’t respect.

      • Where is the history showing that illiberal polities underperform liberal polities?

        As you have just pointed out to Vishmehr, the USA is (ostensibly) owned by all its electors. They are in the process of looting it. This is only to be expected: public ownership of the state creates a gigantic commons; tragedy inevitably ensues.

  6. The sovereign qua sovereign always ‘owns’ marketplaces, that is, sets the rules and regulations for transacting in the marketplaces over which he is sovereign. This is as true in liberal societies as it is in illiberal societies.

    The main difference is that in liberal societies it is denied that this is the case – liberalism justifies its right to rule by asserting the principle that nobody in particular has the right to rule, that is, political liberty. Liberal sovereignty has to hide itself behind a wall of structural bureaucracy, exercising substantive discriminating authority over subjects while pretending to be just a neutral procedural referee.

    So sovereign ownership of marketplaces in liberal societies doesn’t disappear. The sovereign qua sovereign still owns the marketplaces over which “he” is sovereign. But in liberal societies this is necessarily – by the logic of liberalism itself – hidden behind bureaucratic lies, dysfunction and sociopathy.

    • Exactly. The state is always owned de facto. But in liberal societies it is not owned de jure. And this, too, being a sort of subterfuge, is a source of market failure.

      Market imperfection is noise of any sort in the signals between market participants. Such noise can be introduced by imprecision or ignorance or insurmountably high information costs, or by confusion, or by dishonesty. The liberal sham Zippy elucidates is a combination of the latter two.

      • Kristor,
        So, “the state is always owned” means “the sovereign owns marketplaces”?
        I do not understand, who is supposed to own or “own” what?
        You are speaking of an idea of “market perfection” that exists extra-politically while Zippy is speaking of the idea that the “market” DOES NOT exist extra-politically at all.
        There seems to exist a basic disharmony between your view and Zippy’s and I do not see how you could mean by saying “Exactly” here.

      • The state is always owned, by a sovereign; and this involves ownership – i.e., authoritative control – of the marketplaces.

        You are speaking of an idea of “market perfection” that exists extra-politically while Zippy is speaking of the idea that the “market” DOES NOT exist extra-politically at all.

        I think you are misreading both of us. “Market” does not mean “market perfection.” Market perfection is a characteristic of markets, but is not itself a market. Markets are certainly not extra-political. They are all more or less imperfect.

      • “State is always owned by a sovereign”
        Let’s see. Who owns American State?
        And who owns, for instance, the state of United Kingdom? The Queen, I suppose.
        Does she owns the state of UK in the same sense she owns the Buckingham Palace and her other palaces?
        What does “owning a state” even mean?. What does it consists of?
        Ownership of national territory?
        USA occupies a certain territory that we call the national territory of USA.
        The Federal Govt owns certain chunks of this territory that we call Federal lands and Federal buildings.
        But I do not understand this “owning the state” by a sovereign.

      • Evidently not. It is indeed a counterintuitive notion to men who have been inculcated from birth in other notions, such as those of liberalism. I count myself among them.

        We can start with Zippy’s definition of property:

        Property exists when an owner exercises fungible authority over subjects with respect to one or more objects.

        By “object” we don’t mean physical objects: we mean the things in the property relation which are not subjects. Subjects are of course persons: moral agents with the capacity to choose behaviors.
        For lots more on that, see his Serfing USA and my Metaphysics of Ownership.

        Owning the state then means exercising fungible authority (that can be transferred to some other) over other people with respect to things. Without this authority, *there is no State.*

        Legal title to properties – lands, estates, buildings, hammers, oranges, agreements, contracts, and so forth – is established under the aegis of the authority of the State. In effect, as Ilíon points out, all private property is devolved to private persons from and by the legal person of the state, who has them under his eminent dominion, so that he has the power thus to devolve their titles – and to revoke them at whim, under his rights appurtenant to his eminent dominion.

        Liberal polities pretend that none of this is so. But it’s a pretense.

        Now, just to be clear, the legal person of the state is not a natural person. It may in turn be owned by one or more natural persons. If one, then the state is a monarchy; if several, then an oligarchy. In the limit of cameralism, the state can be owned by all the citizens. Thus the authority of the legal person of the state, which in feudal monarchies is vested in the office of the king, can be transferred from one man to another along with the royal office as king succeeds king, or from one set of men to another as administration succeeds administration (as at elections in the USA, or as at the transfer of authority over Russia and her domains from the Communist Party to the oligarchs who succeeded it).

      • Let’s see. Who owns American State?

        The American People own the American State, in just the same way that the stockholders of a commercial corporation own the corporation.

        That the current stockholders of the political corporation which is the USA are allowing, and in some cases demanding, that the officers of the corporation loot it doesn’t change the fact of ownership, or of the long-term damage being done the corporation.

        And who owns, for instance, the state of United Kingdom? The Queen, I suppose.

        Formally and de jure, yes, but not de facto. The British monarch has not been a monarch for some hundreds of years. And, considering that Prince Charles is what monarchies tend to produce, that is not necessarily a bad thing.

      • Kristor,
        I do not regard Zippy as an authority on property and espcially not your playing fast and loose with Zippy’s definition.
        Zippy says property is an authority. You say, since political authority is AN authority thus political authority IS a type of property. By the same logic, a father owns his sons and a husband owns his wife.

      • I’m afraid you are the one playing fast and loose with Zippy’s definition. He emphasizes that property exists in the exercise of fungible authority by an owner over subjects *with respect to objects.* Subjects cannot be objects – not morally, anyway. So you can’t own a person. But that does not mean you cannot exert authority over persons – indeed, it is hard to see how one could exert authority over anything other than a person.

        There is authority over subjects in re objects, and then there are several other sorts of authority over subjects, in re other sorts of things than objects: e.g., intentions, meanings, evaluations, and so forth. NB that many sorts of authority are *not* fungible. A father cannot transfer his fatherhood to another. Yoyo Ma cannot transfer his musical authority to another. A father cannot stop being a father, and Yoyo Ma cannot stop being Yoyo Ma. But a king can stop being a king.

        Authority over subjects in re objects then is not the only sort of authority. The authority of a father to his sons is not ownership. It is a different sort of authority, that does not fall under the category of the property relation. Ownership is indeed authoritative, but so is excellence of any sort.

        Political authority is not property simply on account of the fact that it is a type of authority, but because it satisfies the criteria set forth in Zippy’s definition of property: it is fungible authority over subjects with respect to objects.

      • Ilion,
        “American People own the American State in the same way as stockholders own a commerical corporation”

        Well, I hope the American People do not sell their American State the same way a stockholder might sell his stock.
        And who could buy the American State and supposing the sell goes through, what might be the relation between the American People and the new owner of the American State?

    • Zippy’s definition is too elastic that;s why I had indicated that I do not accept it.
      Private property and political authority though are linked in a reciprocal way.
      Private property is an individual’s claim against the City.
      Political authority is the claim the City makes on the individuals.

      • Private property and political authority though are linked in a reciprocal way.

        Private property is an individual’s claim against the City.

        Political authority is the claim the City makes on the individuals.

        That makes sense. But note that the individual’s claim against the City is secured by the political authority of the City. One sort of political authority the City has over her subjects is the definition of their property rights.

        There is no question that political authority is more than mere property. There is something sacred about it. But then, there is more to *every* object than its status as property. There is more to a relic of a saint than the fact that it is owned by an abbey. That the relic is sacred does not mean that the abbey may not sell it to, say, a diocese.

        Fungibility is key. Can political authority be transferred for value? Yes. It happens all the time. Democratic elections mask the economic nature of the transfer of political authority from one set of men to another that they mediate. That does not mean that elections are not bought. There is no free lunch.

  7. “Market perfection requires internalization of all externalities, and enclosure of all commons”

    This view that “enclosure of all commons” is a good thing is appears to not conform to the notion of a “commonwealth” and also of the notion of “common good”.

    Whatever this theory is, to all appearences, a newly fangled theory from the collision of libertarianism and neo-reaction, what this theory is not—igrounded in the classical ideas of the nature of politics.

    That all commons could be enclosed is utopian. That they should be enclosed is Randism or something similar.

    The endeavor to derive political authority from something more basic, is the idea that is peculiar to liberal theories–Locke or Hobbes for instance. Classically, the City, the Family and the individual are three irreducible levels of human social society and none may be derived from the others.

    • This view that “enclosure of all commons” is a good thing appears to not conform to the notion of a “commonwealth” and also of the notion of “common good.”

      It does. There is no reason a resource may not be owned by everyone, nor any reason that everyone may not benefit from it. Enclosure of the commons involves only ensuring that those who consume the resource in question pay the cost of their consumption … to the rest of the commonwealth. But for that to work, the sovereign must create property rights in the resource, and distribute them to some set of owners, who can then assert their authority over its use, and collect the revenues derived therefrom. These may then redound one way or another to the common good. If they are never collected, however, then all that redounds to the common good is the consumption of the resource.

      Whatever this theory is, to all appearances, a newly fangled theory from the collision of libertarianism and neo-reaction, what this theory is not—is grounded in the classical ideas of the nature of politics.

      God forbid that we should ever think a new thought, eh?

      “Newly fangled:” I love that! Fangle is a wonderful verb. According to the invaluable Online Etymology Dictionary:

      … fangel, “inclined to take,” from root of Old English fon “to capture” (see fang). Sense of “lately come into fashion” first recorded 1530s. Fanglement, “act of fashioning; something made,” is from 1660s. Middle English had gar-fangel, “fish-spear.”

      I infer that “finagle” stems from the same root. That makes more sense to me than the alternatives the Online Etymology Dictionary mentions: English dialectical fainaigue, “to cheat or renege,” or fiddle.

      That all commons could be enclosed is utopian. That they should be enclosed is Randism or something similar.

      Perfection in cost accounting is indeed an ideal to be sought, that can never be quite achieved. All economic thinkers recognize this fact. In the limit, all costs are accounted for; but because we are not omniscient, we can never reach the limit. That is however no reason not to pursue asymptotic closure with it, so long as the cost of the accounting does not outweigh the benefit.

      Proper cost accounting is Randian? On the contrary: it is mere good business, sheer practicality.

      The endeavor to derive political authority from something more basic is the idea that is peculiar to liberal theories.

      Not sure why you mention this. I didn’t proffer any derivation of political authority from something more basic, or from anything at all.

      • The idea of subjecting all human relations in the Polis to cost accounting-this idea is what I am calling Randian.

        Something that is owned by all is precisely an unenclosed common.

        New ideas must conform to the spirit of tradition. This is, I had supposed, the very point of Orthosphere.

      • The idea of subjecting all human relations in the Polis to cost accounting-this idea is what I am calling Randian.

        I never suggested that all human relations should be subjected to cost accounting. Vishmehr, you are tilting at figments of your own imagination.

        Something that is owned by all is precisely an unenclosed common.

        No. A town could enclose its commons without transferring them to anyone, and charge a fee for their use. That would be enclosure, even though the commons would still be owned by “everyone.”

        New ideas must conform to the spirit of tradition. This is, I had supposed, the very point of Orthosphere.

        The idea, as Chesterton puts it, is that one should not tear down a gate until one knows why it was put there in the first place. It is not that one may never ever tear down a gate, nor a fortiori is it that one may never replace a gate with a better, or even erect an altogether new one where never was any gate before.

        To reject honest cost accounting is to reject millennia of tradition. Men have been working steadily to improve accounting since Babylon. If we take the ratio of business records to other sorts as indicative, accounting is the lion’s share of civilized life.

  8. A resource that is owned by everyone is nothing but unenclosed commons.

    There is nothing wrong in having new thoughts but shouldn’t they conform to the spirit of the traditional thoughts?

    Cost accoutning has a place but community and Polis is far more than cost accounting. The commonwealth implies that there are things that are held in common–culture and customs for one. You could never enclose these commons –that is utopian and it is Randian to suppose that all the human relations in the Polis can be reduced to cost accoutning.

    • Cost accoutning has a place but community and Polis is far more than cost accounting. The commonwealth implies that there are things that are held in common–culture and customs for one. You could never enclose these commons –that is utopian and it is Randian to suppose that all the human relations in the Polis can be reduced to cost accoutning.

      Vishmehr, you are engaging in improper reduction. I say, “x is y,” and you interpret that to mean, “x is nothing but y.” I never came close to suggesting that all human relations can be reduced to cost accounting.

      • I ask you to define your terms. And the allegations of improper reduction and positivism bogey fly in.
        The questiion is “What does it mean to own the State?”.

      • Come now, Vishmehr. Imputations of improper reduction and positivism were not bruited merely because you asked me to define terms. On the contrary.

        Long ago in this thread, you asked me what it means to own the state. I then replied:

        Owning the state then means exercising fungible authority (that can be transferred to some other) over other people with respect to things. Without this authority, *there is no State.*

        That was the definition of terms you had asked for. You then repeatedly engaged in positivist improper reduction. For example, I wrote:

        Perfection in cost accounting is indeed an ideal to be sought, that can never be quite achieved. All economic thinkers recognize this fact. In the limit, all costs are accounted for; but because we are not omniscient, we can never reach the limit. That is however no reason not to pursue asymptotic closure with it, so long as the cost of the accounting does not outweigh the benefit.

        To this discussion of cost accounting, you replied:

        … it is Randian to suppose that all the human relations in the Polis can be reduced to cost accounting.

        Do you not see what you did there? You criticized the opinion (ascribed implicitly to me) that all human relations can be reduced to cost accounting, even though I had *just written* that we can never in practice reach the limit of perfection in cost accounting, rendering any such reduction impossible. You read what I had written as the opposite of what it said.

        Notice that word, “reduced.” It is a tell. When you catch yourself using it, go back and read what you have written, to try and prevent falling into the trap of improper reduction.

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  10. Kristor wrote:

    “All these same sorts of bad things can happen in an owned state, too, of course; but only when its owner is inept or wicked or foolish – when, that is to say, it is owned by a lord who is not proper lord of himself.”

    Economic rationality follows from discipline, not the other way around. Lords who exercise self-lordship do so, first and foremost, because they have been exhorted and/or forced to by, or in the name of, a higher authority. They master themselves according to their duty, which is incentivized by honour and not a Homo Economicus-type utility-maximizing calculus; and they exercise good husbandry over their landed estates because that is what their honour and duty require, and only secondarily because they perceive the pecuniary advantages of doing so.

    I think you’ll find this hypothesis to be consonant with the historical facts.

    • Virtue is its own reward, to be sure, and the virtuous man prefers the goods of virtue over other sorts, even at great personal cost. I.e., the goods of virtue optimize his utility. Nevertheless, the pecuniary advantages that generally accrue to virtue encourage weak men to a more diligent pursuit of it. If you want more virtuous behavior, then, it makes no sense to vitiate the economic benefits that virtue tends to generate. On the contrary.

  11. Yeah, it works with a “prudent lord” and a “perfect monarchy.” Which means it doesn’t/won’t work for long in the real world. (Give me the long historical list of prudent lords and perfect monarchies.) It’s ridiculous to compare a declining democracy with a utopian vision of monarchy. You don’t think that monarchies are going to spiral into disaster like democracy? Because in monarchies there is no rise and fall? It’s utopian and forever?
    I just don’t understand people who hate freedom and want a monarch.

    • Freedom and monarchy are not contradictory. Nor are democracy and freedom necessarily yoked.

      There is no utopia. For you to have gained the impression that I was suggesting any such thing is to have fallen with Vishmehr into the trap of improper reduction. I *never said* that monarchy would fix everything. I pointed out only that enclosure of the state – treating it as the private property of a monarch in the limit, or of a chamber of persons as in cameralism – would correct a huge externality. You can correct an externality and still do lots of damage. But, better to correct an externality than not, because externalities generate net economic harms with a probability that verges on unity.

      • You need to explain first what “owning a state” means in the first place.
        Take the Queen of England?
        What does it mean to say that “she owns or ought to own the state of England”?
        Do you mean ownership of the entire territory of England along with everything in it?
        Does she owns or ought to own (were she a proper monarch) England in the same sense she owns Birmingham Palace and Balmoral Castle?
        Does it mean that private property does not exist in England for anybody except the Queen?

        There is a recurring problem that you do not qualify your statements in the way required for the discussion and then cast the blame on improper reduction.

      • Ownership can only exist in a prior state of law. Thus, ownership requires a functioning state. There is no owning anything in an anarchy. Thus you have it precisely backwards.
        To own anything requires a state of law i.e. a state that is defined by and created by non-economic factors i.e. loyalty of a people towards their community or their monarch.

      • There is a recurring problem: that you do not qualify your statements in the way required for the discussion and then cast the blame on improper reduction.

        Vishmehr, I *just gave* you a perfect example of the sort of improper reduction in which you repeatedly indulge – my “cost accounting is an impossible ideal,” versus your wildly unresponsive response that, “it is Randian to suppose that all human relations can be reduced to cost accounting” – and you are *completely oblivious.* Can you really not see that I did *not* suggest that all human relations can be reduced to cost accounting, and that your response to that suggestion I did not make was simply and wonderfully inept?

        It has nothing to do with definitions. You seem rather just hopelessly and cluelessly beset with the positivist urge Zippy adduced. You reduce improperly and then fail to see that you have done so even when you are shown.

        You need to explain first what “owning a state” means in the first place.

        It means exercising fungible authority over subjects – persons – with respect to objects. A true sovereign authoritatively declares, e.g., who has legitimate authority over this or that object. E.g., Elizabeth I granted a monopoly over publication of sheet music to Tallis and Byrd (a pretty sweet deal for a couple of choirboys). She gave them all the property rights over that industry that there were in Britain at that time. These rights were hers to dispose of as she saw fit. She could dispose of them otherwise at her whim. She could take them to herself if she chose.

        To this day, sovereign governments reserve to themselves the right to take any and all private property at whim. E.g., by taxes. Some promise to compensate such takings (at prices they by themselves determine are fair); some do not.

        Elizabeth I owned the power to grant Tallis and Byrd their charter. That authoritative power was hers. And she could have sold it, had she wanted to.

        Does [the Queen of England] own or ought [she] to own (were she a proper monarch) England in the same sense she owns Birmingham Palace and Balmoral Castle?

        No. She does not own England. She does however own the authority to declare who does own this or that bit of England.

        Does it mean that private property does not exist in England for anybody except the Queen?

        No. It means that (de jure) she possesses the fungible authority over her subjects to determine their legitimate property rights in objects. She may transfer that authority to another; sovereigns always do, sooner or later (if they are not usurped). The British Royals have devolved that authority to Parliament and the courts. They could in theory take it back.

        There is private property under a true monarch. But it is made and remains private according to the pleasure of the king. Barons do to be sure have a habit of asserting their own monarchical authority within their domains, over and against the superordinate monarchical authority of the king; so that the king’s title to his royal authority is never wholly secure (what is, under Heaven?). Kingship is nevertheless authoritative, or barons would never bother themselves about it.

        Ownership can only exist in a prior state of law. Thus, ownership requires a functioning state. There is no owning anything in an anarchy. Thus you have it precisely backwards.

        To own anything requires a state of law, i.e., a state that is defined by and created by non-economic factors i.e. loyalty of a people towards their community or their monarch.

        Loyalty is not law. Law is a formalization of prior loyalties, which as ontological rather than merely legal are more basic. Ownership is mediated first by these loyalties, and only derivatively by their formalization in law. When loyalties break down, so does law; and then the mob can wrest property in an instant from its prior owners in law and loyalty, and devolve it to others.

        So, ownership does *not* depend in the first instance on law. Law is not needed to establish it. All that is needed is the loyalty you rightly adduce, of men to each other. Where everyone agrees that Vishmehr owns that plot over to westward, Vishmehr owns it. Law merely formalizes that general agreement, and secures it against future disagreements. Where that general agreement breaks down, no legal formality can secure it; for, legal formalities are themselves just such general agreements about how things ought to be done.

        What you are rightly grasping for here is the notion that ownership depends upon social *order.* Under conditions of social chaos – of anarchy – no sorts relations are secure, whether of ownership or not. But social order is prior to law. There can be social order without law, but not vice versa.
        So can there be property without law. But not without social order.

      • The authority of the state extends to persons, not merely to objects. The state could conscript its citizens to war, to jury duty, to National Service. The state also judges citizens who violates its law. No property owner could do so.

        So, the definition of property that Zippy gives does NOT apply to the political authority.
        What is your point–that political authority is or should be a variety of private property, of ownership?
        Then ownership is prior to the state, that is ownership is prior to the state of laws.
        Which sort of contradicts your own point that ownership is a social condition i.e. would exist in a state defined by society including laws of the society.
        There is no difference between social order and the state of laws.

      • The authority of the state extends to persons, not merely to objects. The state could conscript its citizens to war, to jury duty, to National Service. The state also judges citizens who violates its law. No property owner could do so.

        Vishmehr, you here repeat things I have already asserted on this thread! Are you paying no attention at all?

        So, the definition of property that Zippy gives does NOT apply to the political authority.

        From the fact that the sovereign does indeed bear other sorts of authority than the authority he bears over subjects in relation to objects it simply does not follow that he does not bear authority over subjects in relation to objects. That’s an absurd inference; like suggesting that because Ted has the authority to discipline his kids, he does not own anything.

        What is your point–that political authority is or should be a variety of private property, of ownership?

        You read the original post, right? Maybe not. Better go read it, either way.

        Then ownership is prior to the state, that is ownership is prior to the state of laws.
        Which sort of contradicts your own point that ownership is a social condition i.e. would exist in a state defined by society including laws of the society.

        No. It doesn’t. That ownership arises from social relations prior to law does not mean it cannot exist in a society that has developed law. That’s like suggesting that fatherhood – which is another aspect of social order that is prior to law – must end when law comes in.

        There is no difference between social order and the state of laws.

        More improper reduction. Social order reduces without remainder to its formalization in law, and absent such formalization there is no society; that’s what you have just asserted. It’s a ridiculous idea, obviously false.

    • I just don’t understand people who hate freedom and want a monarch.

      Dissenting Sociologist has a nice reply to this immediately above. Freedom is the opposite of submission to authority. Submission to legitimate authority is both good and good for you. Chains of legitimate authority are either circular or have a top(s). This is true universally, and it is true in any subset. Thus, unless authority chains are circular, there will be at least one earthly king: a man who has no earthly lord.

      The king is a tragic figure. He has nobody on earth to submit to. His foibles lack external restraint. Power corrupts. The badness of kings does count against Kristor’s argument for monarchy, but, on this argument, the badness of kings is a necessary evil whose costs are to be weighed against the benefits of hierarchy and submission.

      Regardless of how much better or worse off I am with Jorge Bergoglio as Pope, there can be no doubt that Jorge Bergoglio is better off with Joseph Ratzinger as Pope. I would be best off if I could do a better job submitting to the Pope, whomever he should be.

      Shorter DrBill: I just don’t understand people who hate deadly toxic waste and want an imperfect water treatment plant.

      • “Freedom is the opposite of submission to authority. ”

        To a Catholic, Freedom is voluntary submission to just and reasonable Authority. Freedom is one of the most misunderstood concepts in history, especially in Modern times.

        “The king is a tragic figure. He has nobody on earth to submit to.”

        A Protestant King does not, but a Catholic King submits to the Emperor, and the Emperor to the Pontiff.

      • @THR: I agree, but those are semantic points. Freedom, in the sense moderns mean it (i.e. license), is the opposite of submission to authority, and I am using king to mean the top of an earthly authority chain.

  12. “sovereign governments reserve to themselves the right to take any and all private property at whim. E.g., by taxes.”

    If a sovereign does anything on WHIM then he acts improperly. The proper acts of a sovereign are ordered to the common good. That is why deliberation has always been a part of rational government.

    A sovereign does not declare that one person should be given this property and another that one.
    The role of government is usually to adjudicate between the individuals when property disputes arise between them. The justice again is deliberative and not just declarative.

    The attempt to shoehorn Zippy’s treatment of ownership, inadequate though it is, into a theory of political authority can not work. Political authority is much more close to paternal authority.

    • If a sovereign does anything on WHIM then he acts improperly.

      Sure. That’s just what monarchs do from time to time, like all men.

      A sovereign does not declare that one person should be given this property and another that one.

      Are you kidding? Have you never heard the term “transfer payments”?

      The attempt to shoehorn Zippy’s treatment of ownership, inadequate though it is, into a theory of political authority cannot work.

      You’ve asserted this, but have not shown it. Indeed, it seems that you don’t understand it.

      Political authority is much more close to paternal authority.

      True! But notice that fathers, too, exert authority over subjects with respect to objects. And that authority is fungible: the office that has it can pass from a father to his executor, and then to his son.

      This is very far from saying that the father’s ownership of the assets of his estate is the only aspect of his paternal authority; I am very far from any such inane improper reduction. Nevertheless his authority over his estate is one of the father’s offices.

      • Do/Can we include a person’s physical body among the “objects” with respect to which the sovereign exercises authority over subjects?

      • No. The body of a man is an aspect of his person. Damage it and you damage him. So it is not an object.

        This does not mean the sovereign has no authority over the bodies of his subjects. He does. But it’s not the authority of ownership.

  13. Love this discussion. Whatever the merits of the formalist scheme, it is certainly a powerful stimulus to reflection on the nature of political authority.

    Two historic ontologies of sovereign power might merit distinction here: the proprietary and social contract theories of the State. The first is the oldest, and belongs to traditional monarchy; it conceives of sovereignty as a monopoly authority over *objects* (human people included in the definition), and predicates the legitimacy of the Sovereign’s right of property on descent and/or acquisition from some aboriginal proprietor, human or Divine. The “Divine right of Kings” is the most familiar example.

    The second is grounded in modern bourgeois formulations of natural law, most famously those of Hobbes and Locke, and to a greater or lesser extent comprises the foundations of the powers and practices of the modern State. This theory ontologically conceives of sovereignty as a monopoly authority over *subjects*, to wit, over the administration of justice and the legitimate use of violence more generally. Conceived this way, any ancestral or aboriginal claims to dominion or propriety are meaningless. The State does not, in the first place, own everything and everyone, but rather *assigns legal titles of ownership* to the subjects (and/or the State itself) on the grounds of a hypothetical pact between the subjects to allow the State to make and enforce authoritative determinations in this area and others.

    These two conceptions, in actual practice, arrive at much the same place- but they get there from radically different premises, and have important points of non-overlap between them:

    -Fungibility: The proprietary form of authority can be transferred from one person to another, albeit within limits set by local laws and customs. The authority predicated on the putative social contract can *never* be alienated by the person in whom it is vested without incurring a catastrophic crisis of legitimacy; the right of the sword is supposed to either rest with that person or devolve back onto each subject.

    -Profit: The sovereign qua proprietor inherently can and will exploit his sovereign property to his own personal avail ( although, as historical progress in religion, morality, and social discipline advances, this sovereign is increasingly and solemnly exhorted to never, ever do that). The sovereign qua officer of the general will, according to contract theory, is corrupt by definition if he does.

    -Patriarchy: The sovereign proprietor always assumes the title of “father of the people.” An important practical upshot is that “cameralist” economic and other public policy *necessarily and invariably* entails State paternalism of the most aggressively interventionist and grossly inefficient form. The same may or may not happen where the contract theory holds sway- but the latter is much more intrinsically market friendly, since it is inimical to patriarchy to an almost psychotic extent (and thus also invariably begets, right along with greater market efficiency, social pathology such as sexual liberation, feminism, family breakdown, irreligion, and anomie in general).

    It will be evident that there’s no way back to the proprietary theory except through its opposite, the contract theory. It’s unlikely that Americans would accept anyone’s pretension to patriarchal dominion of the USA on the claim that he is a direct descendant of Adam, so he would have to contrive to buy it from each citizen- and then be in the position of adjudicating a sales contract to which he is party, and that against a well-armed population that could and would launch a class-action appeal to Heaven if they didn’t like his verdict. Anarcho-tyranny would follow accordingly from this, and any other, monstrous copulation of incommensurate theories of rule. In any case, formalizing rule explicitly based on the private interest of the ruler would first need a regression of moral development to the level of pre-Christian medieval Europe, which condition is quite incompatible with legal formalization of any type. Finally, fans of efficient markets would *not* like the typical cameralist economic policies, which Mises considered fully-fledged socialism. The formalist scheme is an interesting theoretical construct and nothing more. It cannot be implemented in real life and need not be.

    • Thanks for your engagement with this topic, Mr. Sociologist, and for a most interesting and useful comment.

      I’m not so sure that it would be practically impossible to move from a Lockean contractual justification of state authority to a proprietary justification. The steps could be quite straightforward, and undertaken voluntarily by all and sundry. I have explained how in two posts from a couple years ago: A Modest Proposal: Enclose the Commons; and, Enclosure Revisited. In a nutshell, it could be done in a four step process:

      1. Give each citizen a share of ownership in the State.
      2. Move from per capita voting to per share voting.
      3. Allocate any surplus of revenues over expenditures to dividends on each share.
      4. Let the shares be fungible, so that they can be bought and sold.

      That’s pretty much it. There’s lots more detail in the two threads I linked.

      The sovereign qua proprietor inherently can and will exploit his sovereign property to his own personal avail (although, as historical progress in religion, morality, and social discipline advances, this sovereign is increasingly and solemnly exhorted to never, ever do that). The sovereign qua officer of the general will, according to contract theory, is corrupt by definition if he does

      A prudent sovereign – or aristocracy – would see to it that the profits of the state devolved to her subjects openly, honestly, and fairly – that everyone shared in her weal. They would avoid any appearance that they were enjoying economic rents. They would rather do what they could to demonstrate that they had earned their larger share of the state’s revenues on account of their great service to the people. The Good Master loves his subjects, and would die for them; and they reciprocate.

      Magnanimity is how the sagacious king optimizes his own benefit from his kingdom. And from his own life. Think potlatch, but without the bonfires of canoes and houses.

      … “cameralist” economic and other public policy *necessarily and invariably* entails State paternalism of the most aggressively interventionist and grossly inefficient form.

      How come? I don’t see why a royal or noble class cannot rule with a light hand – even, we might say, with an invisible hand.

      … the contract theory … is much more intrinsically market friendly …

      I suppose I’m missing something, but again, how come? Markets flourished throughout the Medieval. What’s to prevent a king from running a fair and free market, other than his own foolishness?

      … formalizing rule explicitly based on the private interest of the ruler would first need a regression of moral development to the level of pre-Christian medieval Europe, which condition is quite incompatible with legal formalization of any type.

      Why would such a moral regression be necessary? If it really is true that market perfection tends to full enclosure of externalities (so that the contract theory is wrong, insofarforth wicked, as being ill-fitted to human nature, ergo unstable), and thus to propriation of the state, would it really be a regression? Would it not rather be the case that such a propriation would represent a better – stabler, more prosperous, more *virtuous* – fit of political order to the facts of man’s essence?

      What is more: do we really have reason to believe that there has been moral progress since the end of the feudal age? I mean, sure; we cannot but believe that what we believe to be good and noble is in fact good and noble, and therefore that those who believe other things are good and noble are simply wrong. But every people in every age believes that some things are good and noble, and some others not.

      Finally, fans of efficient markets would *not* like the typical cameralist economic policies, which von Mises considered fully-fledged socialism.

      A proprietary ruler would do all in his power to optimize the NPV of his revenues, He would do this by expanding his tax base. This he would do by making and keeping laws that optimized the welfare of his subjects – i.e., their wealth; which is to say, his tax base. He would do all in his power to make markets in his domains efficient.

      • “1. Give each citizen a share of ownership in the State”, etc.

        OK I get it now. I had thought that the argument was for the revival of unreconstructed absolute monarchy. But this shareholder-Sovereign scheme doesn’t really look like a monarchy at all in many ways; in fact, it looks much like what we have already, with the difference that ownership and not political power is the foundation of the polity.

        A few problem areas:

        Bureaucracy. The modern State, whatever its constitutional form (traditional monarchy, republic, or sovereign-shareholder), needs a bureaucracy to run the place and a rather large one at that. A bureaucracy whose functionaries were also shareholders of the State would, if anything, be even more self-aggrandizingly pretentious and intractable than its existing counterpart, since the bureaucratic class would naturally reason that, in addition to merely running the place, it owns it, too, and thus claim to comprise a class of key stakeholders of the State with a legitimate claim to autonomy in their affairs.

        Fungibility. The most congenial thing for the ambitious and far-sighted to do in order to get lots and lots of fungible shares for themselves would be to promise, over and above the cash or other payment, representation in the State on behalf of those who sold them. There would thus be a prompt recrudescence of the interest groups, political parties, and other factions we have now, but worse, since where we now have mere civil-society associations we’d have full-blown patrons acting on behalf of otherwise wholly-disenfranchised clients. It would be worse because patrons naturally think of themselves as sovereigns in their own right, and as a matter of principle will disdain to unconditionally take orders from the Sovereign, and also because the client is immediately dependent on the patron, not the Sovereign, and aligns his loyalties accordingly. This situation is pregnant with many civil wars and other disorders.

        ***

        “What is more: do we really have reason to believe that there has been moral progress since the end of the feudal age? I mean, sure; we cannot but believe that what we believe to be good and noble is in fact good and noble, and therefore that those who believe other things are good and noble are simply wrong. But every people in every age believes that some things are good and noble, and some others not.”

        FWIW, you’re in danger of crossing the (paper-thin) line that separates historicism from outright moral relativism here- but this is a digression. AFAIK, every human society, once it has left the stage of barbarism, holds that it is profoundly immoral for the ruler, considered as a private person, to usufruct from the public power (even though every society practices this). This was already true in the Feudal era, e.g. in 1159 John of Salisbury suggestively exhorted: “It should hold true of the Prince, as it should hold true of all men, that no one should seek his own interest but that of others”, and that the Prince must:

        “not regard as his own the wealth of which he has the custody for the account of others, nor will he treat as private the property of the fisc, which is acknowledged to be public. Nor is this any ground for wonder since he is not even his own man, but belongs wholly to his subjects”.

        Over the centuries, this type of thinking has intensified to the point where it recently happened, here in Canada, that a minister who spent from a public expense-account while perfectly legally entitled to do so nonetheless became the center of a media scandal and subsequent full audit at the expense of his reputation. Under these conditions, it’s hard to see how the sovereign-shareholder scheme could ever garner enough public legitimacy to fly- no matter that, as you pointed out, there would be no actual misappropriation of public money involved.

        ***

        “I don’t see why a royal or noble class cannot rule with a light hand – even, we might say, with an invisible hand… What’s to prevent a king from running a fair and free market, other than his own foolishness?”

        What happened historically, as the Feudal era drew to a close and society began to modernize, and especially in Continental Europe, was that Kings, and their intellectuals, started taking the patriarchal metaphor of Kingly authority way too literally. The nation was very explicitly conceived as the King’s household, and its adult residents his children.

        These Kings certainly sought to, in your words, expand the tax base by making laws that optimize the welfare of subjects and make markets more efficient; that was the very explicit goal of the theory and practice of cameralist administration.

        However, the household metaphor, when taken literally, furnished a horizon of implicit and explicit assumptions concerning the nature of men and things that coloured their subsequent perception of what exactly the State must do to realize those goals. Theories of public policy written under such illuminating headings as “household management” (“haushaltungkunst”; cf. “economy”) and “police science” (“polizeiswissenschaft”, i.e. of the “well-ordered police-State) assumed that, since the subjects are perpetual children, they are intrinsically and incorrigibly incompetent, ignorant, foolish, utterly and rightfully dependent, and accordingly in need of constant hand-holding guidance and micro-management. This, in turn, was aggravated by the natural tendency of any father to stand, one way or another, as a God-like figure relative to his children, and finally, by the natural human folly of liberty whereby men reason that having the *right* to do whatever they want means they *actually* can.

        It goes without saying that none of this was conducive to the idea of the “invisible hand”, nor, more generally, of “the market” considered as an autonomously self-correcting system whose inner workings can never be fully transparent to the Sovereign. To be sure, the contract theory of Hobbes, although it vigorously rejected patriarchalism, wound up in the same place, since it also saw society as the pure creature of the State and entirely dependent on its authority. But the liberal variation associated with Locke reasoned that, if the people can unite in order to appoint a government, they also can get along without it; thus there can exist an autonomous sphere of social action prior to the State. This way of thinking was highly congenial to the emergence of the idea of a market that, for the most part, orders itself, with the State needing to do little more than settle contractual disputes and otherwise just sit back and watch the tax revenues roll in to the public coffer.

        Sorry for the length and pedantic detail; again, the formalist scheme raises far-reaching issues and questions concerning the foundations of the State.

      • I had thought that the argument was for the revival of unreconstructed absolute monarchy. But this shareholder-Sovereign scheme doesn’t really look like a monarchy at all in many ways; in fact, it looks much like what we have already, with the difference that ownership and not political power is the foundation of the polity.

        This post did not intend to argue that absolute monarchy *ought* to be resurrected, but rather only to observe what the title says: market perfection tends to monarchy, and vice versa. Markets tend toward perfection opportunistically – nature hates a vacuum, homeostasis, and so forth – so there is always a monarchy of some sort, or an oligarchy, de facto if not de jure. My inclination is to the notion that honesty being the best policy, it is better in every way for a society to be open and frank about its own oligarchy and the head thereof.

        NB: not *absolute* monarchy. I take it as a general truth that apart from saintliness, absoluteness of any sort in human affairs is eo ipso a departure from the Nicomachean Mean, ergo wicked – literally, weak. Tyranny is a disease of monarchy.

        Contra absolute monarchy, perfect monarchy is trammeled about with golden bonds of duty, loyalty, obligation – noblesse oblige. This is no more than to say that under perfect monarchy, authority is widely distributed across society, rather than concentrated in the royal office. And power comes with responsibility, which is to say that it comes with duty, tit for tat. This is why tyranny is unjust; as shirking the monarch’s natural and proper duty to his subjects, it is an uncompensated taking. But power is conserved, so a balance of power and duty is kept, is sought if disturbed – the more keenly the greater the disturbance. Tyranny almost always ends badly for the tyrant.

        One of the nice design features of the sovereign-shareholder scheme is that it naturally tends to concentrate ownership in hierarchical fashion, and by families, then clans, tribes, nations (so that the Familiar Society – the Nation – is thereby encouraged). The monarch and his family, e.g., might own more shares than any other family; the aristocrats and their families might each own lots of shares, but fewer per family than the monarch and his; and so on down to private citizens, who each own their own share. Each shareholder in this system is obliged to all.

        More obligation terminates upon the monarch than upon anyone else. He has more control over the state than anyone, but his control is never perfect or absolute, for there are always aristocratic families or associations of private citizens jockeying for more shares. He reaps more dividends than anyone, to be sure. But this is due to his sagacity in amassing shares as his private property. And dividends are distributed across the whole citizenry, so he answers to all the citizens for the quality of his control of the state, such as it is.

        States always work more or less this way, in practice. The shareholder-sovereign scheme just makes it formal and explicit – makes it honest and above board.

        … the bureaucratic class would naturally reason that, in addition to merely running the place, it owns it, too, and thus claim to comprise a class of key stakeholders of the State with a legitimate claim to autonomy in their affairs.

        Yeah, that’s what we have right now. It’s just that until Trump started speaking out of turn, the fact was kept well hidden. Let it be out in the open. That will be much healthier.

        … where we now have mere civil-society associations we’d have full-blown patrons acting on behalf of otherwise wholly-disenfranchised clients. It would be worse because patrons naturally think of themselves as sovereigns in their own right, and as a matter of principle will disdain to unconditionally take orders from the Sovereign, and also because the client is immediately dependent on the patron, not the Sovereign, and aligns his loyalties accordingly. This situation is pregnant with many civil wars and other disorders.

        Again, this is what we have right now, but dishonestly. It was what we had in the feudal era, honestly. Wars back then were small, generally short affairs. There was nothing then anywhere close to the meat grinders of 20th century nations.

        That barons disdained to knuckle under to their king was a feature, not a bug. It constrained both the king and his barons.

        Better to have this all honest and above board. Think subsidiarity, all the way down to the peasant with his plot and his pitchfork, with each level of the hierarchy bound to those above and below by bonds of mutual obligation and duty – and possibility of loss, in the event of defection from those obligations. At the very bottom of the hierarchy: the unfranchised, children, animals.

        But every people in every age believes that some things are good and noble, and some others not.

        FWIW, you’re in danger of crossing the (paper-thin) line that separates historicism from outright moral relativism here …

        I did not mean to suggest that some things are not really better and nobler than others. I meant only to point out that every human society has a notion of natural law (even if only in the form of superstitious taboo) that it tries to follow.

        I am pretty sure that our notions of what is good and noble are in respect to those of the High Medieval not progress, but devolution. By their fruits shall ye know them. No civilization in history has produced anything as beautiful as the Gothic cathedrals, churches and chapels of medieval Europe. We’ve got power and scale over them, to be sure; but not beauty.

        AFAIK, every human society, once it has left the stage of barbarism, holds that it is profoundly immoral for the ruler, considered as a private person, to usufruct from the public power (even though every society practices this).

        One of the arguments for the sovereign-shareholder scheme is that the benefits accruing to the monarch from his shares are optimized if conditions are such as to optimize those benefits for all shareholders. His benefits are his insofar as they accrue to him from his private property in the shares he owns, and do not therefore constitute a usufruction of his public power. Furthermore, because so many of his subjects hold that same sort of property, his interests are aligned with theirs. All the shareholders want what is best for the long term general weal, because it is when the whole culture prospers most that they do, too.

        Nothing will prevent the occasional idiocy, of course. *Any* concentration of power is morally hazardous. But there is no getting around that hazard, if you want to have any social order at all.

        What happened historically, as the Feudal era drew to a close and society began to modernize, and especially in Continental Europe, was that Kings, and their intellectuals, started taking the patriarchal metaphor of Kingly authority way too literally. The nation was very explicitly conceived as the King’s household, and its adult residents his children.

        This is a notion of government that goes back as far as written records. So it probably goes back to our beginnings.

        These Kings certainly sought to, in your words, expand the tax base by making laws that optimize the welfare of subjects and make markets more efficient; that was the very explicit goal of the theory and practice of cameralist administration.

        However, the household metaphor, when taken literally, furnished a horizon of implicit and explicit assumptions … that, since the subjects are perpetual children, they are intrinsically and incorrigibly incompetent, ignorant, foolish, utterly and rightfully dependent, and accordingly in need of constant hand-holding guidance and micro-management.

        That was an error of policy; analogous to the error of parents who never treat their adult children as adults. It happens. We may not conclude from the fact that parents do err in this way that there should be no parents. So likewise for monarchs. Monarchy, market perfection, immaculate subsidiarity, formalism, cameralism fulfilled, optimal public policies: these are all ideals to be pursued, that societies seek, but that they never fully realize. Even if they were fully realized, no utopia would ensue. For, men are wicked. Things would still be a mess. Just less of a mess.

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