Monday, February 23, 2009

Ruminations 23: An Ancient Basis for Creating Modern Non-State Regulatory Systems

(Pix (c) Larry Catá Backer)

This is another in what I hope to be a month long series of aphoristic (ἀφορισμός) essays, meant to provoke thought rather than explain it. The hope is that, built up on each other, the series will provide a matrix of thoughts that together might lead the reader in new directions. Though each can be read independently of the others, they are intended to be read together and against each other.
The mob has become the most powerful force in a world that operated under the logic of globalization. Its most potent weapon is opinion and the cultivate of popular belief is the most important instrumental aim of sovereigns, all of whom are dependent on it and them.  Opinion makes use of might to create custom. And from custom proceeds justice that eventually serves as the basis for law.

One of the most refreshing section's of Blaise Pascal's Pensée's (1670), is Section V (Justice and the Reason of Effects)(Nos. 291-338). Two are worth considerable thought in any successful operationalization of soft law systems for the global regulation of multinational corporations. The first, No. 303:
Might is the sovereign of the world, and not opinion. But opinion makes use of might. It is might that makes opinion. Gentleness is beautiful in our opinion. Why? Because he who will dance on a rope will be alone, and I will gather a stronger mob of people who will say that it is unbecoming.
The other, from No. 309: "Justice--As custom determines what is agreeable, so also does it determine justice."

The absence of a prince--the governemntal apparatus of a state and its institutional legitimacy within the constraints of its constitution--does not necessarily impede the construction of an effective regulatory system. What is required is a community of stakeholders willing to participate, an institutional framework within which their interests are preserved (or challenged), and a demonstrated power to generate custom. Merchants have understood this for centuries and have managed to use multiple systems simultaneously for the construction of a strong culture of behavior among merchants who deal within their community across the often changeable borders of states. It is clear that such a system can be created without a state (or beyond the state) for the regulation of economic entities as well. What are needed are a set of critical actors that can function within a self contained and self-referencing system for the development and enforcement of custom.

Consider the U.N. Global Compact project. It is a system that is partially complete and therefore powerless. The project contains the body of opinion necessary to provide the basis for regulating conduct, but it does not yet have the structure for molding opinion among key actors that serves as the source of regulation and deploying that opinion as a force for a targeted effect. As such, it lacks the popular basis for the construction of custom that itself can serve as the metric of justice. And yet it has the ingredients to move from opinion to power and from power to justice. Critical are those actors who can mold opinion--economic actors, civil society, and media elements. But also critical are the population of consumers and investors whose choices serve as the incorporation of custom into the behavior of those whose customs are of greatest interest to both economic actors and elements of civil society. It is one thing for the United Nations to elaborate ideals. It is quite another to incorporate those ideals as the customs of consumers and investors, and thus of the economic entities subject to the power of those customs.

The key, then, is the incitement of Pascal's mob to an internalization of belief and then to action on the basis of that belief. And this is simple enough.

--Convince economic actors that the value of conforming, and appearing to conform, produces positive economic effects--positive media coverage, positive government incentives, increases in consumer and investor activities.

--Create a system in which such entities can brand themselves as conforming to those principles by adhering to the system.

--Provide wide outlets for the dissemination of the standards of such system through media outlets and the state (as well as the other system participants).

--Institutionalize the values production within elaborate structures in which all who might profit from the production and enforcement of such values participate.

--Bureaucratize the elaboration of such values in legitimating institutions of appropriately pedigreed individuals and organizations that reinforces, to the individuals who are the object of all of this activity, that the work of these entities produces great good (who ever defined).

--Build a rule of law based system for the monitoring and enforcement of the values in which all stakeholders participate, but where judgment is rendered by "neutral" elements.

--And ensure that penalties work to further internalize values rather than to merely to punish.

The object is to reinforce behavior that then becomes custom adopted by economic entities within a values structure embraced by the people and publicized (as good) by media outlets. Systems can be constructed where there is advantage for everyone. And networked advantage becomes a proxy for the just.

Opinion makes use of might to create custom. And from custom proceeds justice that eventually serves as the basis for law. Underlying all is the great insight from No. 294:
Custom creates the whole of equity, for the simple reason that it is accepted. It is the mystical foundation of its authority; whoever carries it back to first principles destroys it. Nothing is so faulty as those laws which correct faults. He who obeys them because they are just, obeys a justice which is imaginary, and not the essence of law; it is quite self contained, it is law and nothing more.
It is within this context that the power of soft law regulatory systems can be understood, and the key to their successful implementation discerned fashioned. It evidences the ways in which the acceptance of mass democratic principles as the foundation of government in Western and Marxist-Leninist states, has changed the dynamics of the practices of states and the management of its popular sovereigns.  Yet the currency of power remains the same. 

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