On the People's Terms

"I think this is a really great book—a profoundly important book. There’s a more popular version of it ( Just Freedom ), which I think didn’t reached the big audience that it deserves. I want to say a few things about Pettit. The first is that, even more than Waldron, he departs from the dominant strain of political theory over the past forty or so years. His message is that it’s not just about justice; it’s about legitimacy, too. Part of Pettit’s project is about giving legitimacy equal rank with justice. That happened to be the entry point for me into my own project: under what conditions can the extraordinary powers of unelected central bankers and regulators be legitimate in our democratic societies. The mainstream liberal principle (on both the political left and right) is that we as individuals should be free from interference, with politics revolving around disagreements about what that involves. Pettit, the historian of ideas Quentin Skinner, and others want to draw on a different part of the West’s political history: the republicanism of Rome, some of the Italian city states, and some of the U S Founding Fathers. This prioritises freedom from domination: if I’m a slave with a completely benign mistress or master, I am still a slave. Pettit argues that we can only be free in that sense—free from domination—if there is some kind of popular control over our governance, with the capacity to shape our government and contest government’s choices, policies and actions. He thinks that representative democracy is important to achieving this, provided there are venues for challenge and plenty of public debate. In terms of thinking about the administrative state, this leads him to the idea that the public, after debate, might want to put certain things beyond the day-to-day reach of politicians. Where the people’s purposes are clear and have been legislated, but elected politicians have incentives to depart from pursuing those purposes (say, pursuing a higher rate of inflation), the lack of constraint on the politicians means the people are exposed to domination. In those circumstances, we might want our elected representatives to constrain themselves by delegating to an independent body, such as to an independent central bank for price stability or an electoral commission for the integrity of the electoral system. Get the weekly Five Books newsletter Going back to Majone’s distinction between agents and trustees, what I take from this is that a trustee-like independent agency must be given a clear objective (as otherwise how can we tell whether or not they are sticking to the people’s legislated purposes), and its leaders must have incentives to pursue that objective. That harness depends on their valuing the public and professional esteem accruing from doing their job. So here we find a modern version of the old republican idea of being honoured for public service. In Pettit’s account of our inherited republican values, therefore, we now, finally, have some grounds in political theory for squaring institutional commitment devices with representative democracy: it is credible commitment to the people’s purposes that matters. “It is credible commitment to the people’s purposes that matters.” Bringing Waldron back in, the crucial thing is that the public can always change its mind. They can go back and press their elected representatives to repeal or amend the law that delegated to the central bank (or regulator). But the politicians themselves can do that only in a very public way, through a debate and vote in Parliament or Congress. The legislature is there to be seen, and so can’t undo the delegation surreptitiously—Congress can’t just ‘un-delegate’ to the Federal Reserve in secret by decree, overnight, without telling the American people and without going through the normal parliamentary process. “Everything comes back to the elected legislature” So, with Landis, we’ve ended up distinguishing between different degrees of insulation, with independent agencies looking quite distinct from other agencies that are under day-to-day political control. Meanwhile, with Lowi, we can find the beginning of solutions in Majone, Waldron and Pettit. Lastly, compared with Majone, we discover some grounds for different types of delegation—rooted not just in economics, but in our political values, drawing on both liberalism and republicanism. What my own book attempts to do is weave all of that together, bringing the economics of incentives (or institutional design) into line with democracy, the rule of law and constitutionalism. Yes, I completely agree. A few years ago, somebody from the Bundesbank said it’s very important that central bank independence isn’t debated, whereas I think that is absolutely the wrong way around. It is very important that it is debated. That feature of constitutional democracy is not something that, if you like, is timeless. It’s something about our particular political values… Yes. For us, legitimacy “now and around here”—to quote the late British philosopher Bernard Williams—entails public debate and accountability. Central bank independence or the independence of regulators is not something that’s okay if we never actually discuss it. It has to be discussed. That’s why testifying to parliamentary and congressional committees isn’t an ordeal, but the very lifeblood of an agency’s legitimacy. This is where I completely agree with Waldron. Everything comes back to the elected legislature, because our system of government ultimately depends upon the legislature drawing lines between the pursuit of efficiency and of equity, reconciling our disagreements on various fronts for the time being. Legislation itself is a commitment device. You can’t flick a switch and it’s no longer law; you have to go through a process to change it, and it’s done in more or less bright sunlight. We debate legislative change, which is terrific. My book is trying to draw on both our liberal traditions and our republican traditions. The problem with the liberal tradition, as Lowi saw, is that it too easily ends up saying that vague delegations are inevitable, and therefore we must have these technocrats overseen by the courts and we must make it easy to challenge their rules and decisions via the courts. “The problem with the liberal tradition, as Lowi saw, is that it too easily ends up saying that vague delegations are inevitable” I don’t want to argue against those processes, but they can’t suffice because they amount to no more than one group of unelected officials (judges) overseeing another group of unelected technocrats (central bankers and regulators). So, if we have legislatures that just pass vague statutes—in effect handing over their power and responsibility to set high policy—and then say that judges will see it’s all okay, then something has gone deeply wrong. Yes, exactly. That’s why I wanted to draw attention to Pettit’s book, because I think the traditions of legal liberalism, as people sometimes call it, just cannot be sufficient given our political traditions and values. In the technocracy versus populism debate, part of the reason—but by no means the only reason—why there’s a public backlash is that a world of technocrats overseen by unelected judges is not what our system of government is meant to be. Undemocratic liberalism will not do for us. It is. Echoing US Founding Father John Adams’ description of aristocracy as ‘the few’, an expression I use in Unelected Power is ‘the new few’, where the new few is central bankers, top judges, and top regulators. That wouldn’t be a safe, sustainable place to end up."