“Constitutionalism”

Democratic Despotism:

“We find latent in their conception of law— and some have been publicly preaching this view— that law emanates solely from the will of the majority of the people, and can, therefore, be modified at any time to meet majority wishes. This doctrine is absolutely totalitarian, and is contrary to our basic conceptions of the source of law. We have seen that our political system is predicated on the doctrine that there are some immutable laws of nature and certain other divinely sanctioned rights, which the Constitution and our tradition recognized as being above and beyond the power of the majority, or of any other group of individuals or officials of the Government. There are, also, other rights, which because of man’s historic experience, that are specifically protected by the Constitution, and which can only be modified under the prescribed method set forth in the Constitution; and, consequently the majority- will is not free to modify them as it pleases, but only in the circumscribed manner prescribed by the Constitution. That is why our system has been characterized as a government of laws, not of men. That is the distinction between impersonal law and personal law. Americanism is the system of government by impersonal law: totalitarianism is the system of government by personal law.” (emphasis added) — Raoul E. Desvernine, vice-president of the American Liberty League, Democratic Despotism. 1936 (cited in “Business Organized as Powerr: The New Imperium in Imperio” see also “Constitutionalism: Political Defense of the Business Community during the New Deal Period.”)

“Business Organized as Power”:

“As stated in its constitution, the [American Liberty] League’s purposes were, among others,  “to defend and uphold the Constitution of the United States,” “to teach the necessity of respect for rights of persons and property,” “to encourage and protect individual and group initiative and enterprise, to foster the right to work, earn, save and acquire property, and to preserve the ownership and lawful use of property when acquired.” To win these goals the League went further than any previous liberty-loving, liberty-saving organization in our history. Crucial to its functioning was the National Lawyer’s Committee, a group of some 58  prominent attorneys, which issued reports or opinions in advance of Supreme Court decisions, opinions setting aside with solemnity and erudition one after another of the entire New Deal legislative mélange. The League went still further: this private court having, for example, formally declared the Wagner Labor Relations Act unconstitutional, openly advised employers to ignore its provisions.”

So let me get this straight: a democratically-elected Congress doesn’t have the authority to pass legislation that a self-appointed group of 58 elite lawyers doesn’t think is in accord with “some immutable laws of nature and certain other divinely sanctioned rights”? And this is what is meant by “a government of laws, not of [58] men”? Need I add “wealthy, white, conservative” men?

We live in an odd inversion of the New Deal. The National Lawyer’s Committee has been reborn as the Federalist Society, the American Liberty Lobby as the Council for National Policy and it is those factions that hold an iron grip on the White House, the Senate and the Supreme Court. The “laws of nature” are indeed “immutable.” Human understanding of those laws is imperfect and evolving.
Take John Locke’s justification of private property, for example. Rather than link to a very relevant seven-year old post, I will re-post it below. John Locke could not have meant what Raoul Desvernine and the American Liberty Lobby presumed about the law of nature and inalienable property rights.
“Of Property”:

“Though the earth, and all inferior creatures, be common to all men, yet every man has a property in his own person: this no body has any right to but himself. The labour of his body, and the work of his hands, we may say, are properly his. Whatsoever then he removes out of the state that nature hath provided, and left it in, he hath mixed his labour with, and joined to it something that is his own, and thereby makes it his property.”

The above is the core of what is commonly referred to as John Locke’s “labour theory of property.” It is a extraordinarily compelling narrative, resplendent with “self-evident truth” (“We hold these truths to be self evident…) and nearly indiscernible ambiguity (what does “labour” mean? what’s “mixing” got to do with it?).

It is widely acknowledged by Locke scholars that his economic views were essentially mercantilist. Keynes suggested that Locke stood with “one foot in the mercantilist world and one foot in the classical world.” However that may be, chapter five of Locke’s Second Treatise on Civil Government, “Of Property”, is relentlessly, incorrigibly, two-footedly mercantilist. And nobody seems to have noticed (except possibly John R. Commons [correction: C.B. MacPherson stressed Locke’s mercantilism in chapter 5]).

Why would this even matter?


Yeah, sure, we are told, ad nauseum, about how PROPERTY is the be all and end all of freedom, democracy and prosperity. A comic-book, social Darwinist pseudo-Locke lends the right-wing libertarian anti-tax mantra a veneer of moral righteousness and intellectual gravitas.And it’s crap.But there are bigger fish to fry: LABOUR. While socialists and even liberals may be inclined to circumscribe the sanctity of property, they are loath to gainsay the hallowed individualist framing of labour. Some folks even think it’s downright revolutionary to insist on the worker’s right to the whole product of labour. Labour, though,  is only conventionally something an individual performs. Labour is social. Labour power is best understood as a common-pool resource.

The ideology of labour as an extension of the self is pervasive, persuasive and pernicious. From that perspective, solidarity is a voluntary act of magnanimity that can be “terminated at will” just like a redundant employee. As individuals, the relationship between workers is accidental; their relationships with the employer and with the state are what matters.

The inescapable mercantilism of Locke’s notion of natural law puts that individualist ideology in a different light. In his Essays on the Law of Nature (VIII), Locke was adamant that “the rightness of an action does not depend on its utility; on the contrary, its utility is a result of its rightness.” “It is impossible,” Locke wrote, “that the primary law of nature is such that its violation is unavoidable. Yet, if the private interest of each person is the basis of that law, the law will inevitably be broken…”

Here is where the mercantilism comes in: “when any man snatches for himself as much as he can, he takes away from another man’s heap the amount he adds to his own, and it is impossible for anyone to grow rich except at the expense of someone else.” To avoid any mistake, Locke reiterates his objection to positing “every man’s self interest the basis of natural law”:

“For in such a case each person is required to procure for himself and to retain in his possession the greatest possible number of useful things; and when this happens it is inevitable that the smallest possible number is left to some other person, because surely no gain falls to you which does not involve somebody else’s loss.”

An unequivocal zero-sum game. “No gain falls to you which does not involve somebody else’s loss.” “It is impossible for anyone to grow rich except at the expense of someone else.”

Now there are those who will object that Locke modified his views between the earlier Essays on the Law of Nature and his later Second Treatise on Civil Government. Not so. In the latter, and especially in the chapter “Of Property,” Money plays a pivotal role in repealing what has become known as the spoilage limitation:

“He that gathered a hundred bushels of acorns or apples, had thereby a property in them… He was only to look, that he used them before they spoiled, else he took more than his share, and robbed others. And indeed it was a foolish thing, as well as dishonest, to hoard up more than he could make use of.”

Someone who took so much that it spoiled before he could use it did a foolish, dishonest thing and robbed others. In short, if you take so much that it rots, it was never yours to take.

How does Money nullify that limitation? The person who gathers more perishable goods than he can use can exchange it for durable Gold or Silver. Problem solved.

Locke was a staunch metallist who insisted on the intrinsic value of Money as represented by its weight and fineness. This is not some incidental biographical trivia. Locke’s well documented views on Money were decisive in the monetary reform and re-minting of British coinage in the 1690s.

According to Locke, it was not the absolute quantity of Gold and Silver a nation held that determined its wealth but the proportion of Gold and Silver it held relative to the holdings of the rest of the world:

“Riches do not consist in having more Gold and Silver, but in having more in proportion, than the rest of the World, or than our Neighbours, whereby we are enabled to procure to our selves a greater Plenty of the Conveniencies of Life than comes within the reach of Neighbouring kingdoms and States, who, sharing the Gold and Silver of the World in a less proportion, want the means of Plenty and Power, and so are Poorer.”

A zero-sum game. What was “one man’s gain is another’s loss” in useful things is mitigated by its transmutation into metal Money where one man’s gain is still another’s loss but is at least not a net loss (through waste). This later proviso, though, only holds good for Money with an intrinsic value of specified weight and fineness.

Postscript 

Some readers may have wondered at the parenthetical reference to John R. Commons back in the second paragraph. Commons didn’t specifically address the passages I cited from the Essays on the Law of Nature. In fact, it wasn’t published until 20 years later. Nor did he discuss Locke’s influential writings on Money. But he did make a point in a reply to a critic that is germane to my argument here.

The context of Commons’s observations is crucial to the significance of his remark, so I will reproduce a substantial excerpt here:

My point of view is indeed personal, as was said by Professor Homan of all institutional economists. It is simply my own experience in collective action from which I drew a theory of the part played by collective action on individual action. It may or may not fit other people’s ideas of institutionalism. It started, indeed, with my trade-union membership and my later participation in labor arbitration; then turned to drafting a public utility law designed to ascertain and maintain reasonable values and reasonable practices; then to drafting and participating in administration of an industrial commission law with the similar purpose of reasonable practices applied to employers and employees; then to representing the western states before the Federal Trade Commission on the Pittsburgh Plus case of discrimination; then to aiding the House Committee on Congressman Strong’s bill for stabilization of prices; meanwhile administering and developing a plan for unemployment insurance finally enacted into law.

I do not see how anyone going through these 45 years of participation could fail to arrive at two inferences, conflict of interest and collective action. Even the state itself turned out to be merely collective action of those in possession of sovereignty.

Meanwhile I was necessarily studying hundreds of decisions, mainly of the United States Supreme Court, endeavoring to discover on what principles they decided disputes of conflicting interests under the clauses of the Constitution relating to due process, to taking property and liberty, and to equal treatment. I found that none of the economists had taken this point of view, and none of them except Professor Ely, had made any contributions that would make it possible to fit legal institutions into economics or into this constitutional scheme of American judicial sovereignty.

Drumroll… Now here’s his point:

Going back over the economists from John Locke to the orthodox school of the present day, I found they always had a conflicting meaning of wealth, namely a material thing and the ownership of that thing. But ownership, at least in its modern meaning of intangible property, means power to restrict production on account of abundance while the material things arise from power to increase the abundance of things by production, even overproduction.

A simple point but a profound and subtle one. Ownership is not the same as the material thing owned. But beyond that, the restrictive implication of ownership is contrary to the abundance implication of the material things owned.

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