Judging the Honduran Constitutional Order Beyond the State—An Interrogation of the View From the Transnational Sector

There was a time when international law played little role in the way in which a sovereign nation-state ordered its constitutional system, and then applied that ordering internally. That was especially the case with respect to the application of the process rules of a nation’s constitution, and the division of authority between the two principal elected branches of state—the executive and legislature—and the judicial power to oversee that division. To some extent that idea is still true—the United States Congress would have found it incomprehensible had its proceedings against President Clinton in 199 been interpreted as in violation of either some supra-constitutional norm or a set of international norms and treaties with paramount authority over the matter.

But times have changed. I have argued that since the end of the Second World War, a new transnational legal order has been seeking both authority and legitimacy with respect to control over the normative framework and limitations within which nation-states may elaborate their national constitutional systems. See (Backer 2009). Modern transnational constitutionalism posits the development of a set of norms and expectations about process and substantive rules applicable to all constitutional orders, or at least those that are to be understood as legitimate. These are based on consensus among the community of nations as articulated either in a variety of international instruments or in some form or another of customary international law in general and jus cogens in particular. (Backer 2008).

Constitutionalism has, for the last century or so, sought to provide a basis in theory for legitimating certain forms of state organization within territorially based political communities. (Backer, 2009). Constitutionalism serves as a basis for classifying the form of state systems of governance. (Henkin 1993). Its object is twofold—to develop an ideal of governance forms and to judge the legitimacy of a constitutional system against this ideal. (Okoth-Ogendo 1993) Constitutionalism is grounded on the fundamental postulate of rule of law—that states ought to be organized to avoid tyranny or despotism by grounding state action in law and by limiting the reach of such lawful state action on the basis of values reflecting the values of the political collective. (Coomaraswamy 2993).) Beyond this institutionalizing and legitimating objective, constitutionalism can be grounded on any number of legitimating value systems—each competing with the others for the allegiance of the greatest number of states. (Backer 2008). When the source of values is the transcendent genius of the nation itself, it is understood as nationalist constitutionalism. (Rubenfeld 2004). When the values are sourced in the consensus of the community of nations, understood as common constitutional traditions of the community of nations or as the expression of international consensus in international conventional law or customary international law (Herschl 2004), it is understood as transnational constitutionalism. (Backer 2008).

It appears that the legitimating power of this new transnational constitutionalism is felt most directly by small and less powerful states. Recently, Honduras has provided a great laboratory within which notions of transnational constitutionalism can be better refined, and from which other states may base their policies and actions. For some time, Mr. Zelaya had been involved in a great contest over the meaning and extent of his powers within the Honduran Constitutional system, which pitted him against the other two branches of government. (Latin American Coups and Constitutions, 2009). As is by now well known, on June 28, 2009, then President Manuel Zelaya was rousted from his bed by the military acting on a judicial warrant of arrest. But rather than wind up in prison and facing trial, Mr. Zelaya was packed off to Costa Rica. Almost immediately after which he was removed from office by the Honduran Legislature and replaced by Rigoberto Micheletti, at the time the President of the Honduran Congress. (Q&A Crisi in Honduras, 2009; Congreso destituye a Zelaya 2009).

By the time of his removal, it was clear that the legitimately elected legislative branch, and the judicial branch, had determined that there were serious breaches of the Honduran Constitution by Mr. Zelaya that rendered him unfit for office. It is also true that the methods leading to his removal and exile were, at best, constitutionally imperfect. (Backer July 4, 2009). But reaction to the removal displayed no measure of restraint or consideration of the internal issues specific to Honduras and its internal structuring. And little thought was given to idea that this was an internal matter to be left to Honduras. Rather, the external reaction was almost immediate, uniformly negative, and specifically bent to projecting foreign power into Honduras. Many states were quick to condemn the actions as a military coup, and virtually all of Latin America, led by Venezuela and Cuba, among the strongest of Mr. Zelaya’s friends in Latin America and members, with Honduras in ALBA, the socialist regional trade association, also condemned the “coup”. As reported by the Chinese press, “ALBA’s position and characterization of the events in Honduras quickly became the standard version of reality. “The regional bloc of the Bolivarian Alternative for the Americas (ALBA) condemned the coup in Honduras that ousted President Manuel Zelaya Sunday. A statement issued after a special meeting of foreign ministers urged the reinstatement of Zelaya, and said the ALBA member countries will not recognize any government or person rising from the coup.” (Backer July 21, 2009; citing ALBA Condemns Honduran Coup, June 29, 2009). Condemnations by the U.N. (U.N. July 1, 2009), the Organization of American States (OAS July 1, 2009), and the European Union (EU Suspends $90 Million Aid to Honduras, Jul 13, 2009)) quickly followed. Thus, the mechanics of a transnational constitutionalism—something that my students have sometimes suggested does not exist, were quite in evidence in the efforts of the community of nations to require Honduras to conform to their aggregate ideas of how their internal situation ought to be resolved in this dispute among the three branches of its government.

But such condemnation requires a conceptual foundation. That is being supplied by resort to the principles of transnational constitutionalism. One of the best examples of efforts to legitimate political condemnation in law, and thus to de-legitimate the actions of the Honduran legislature and judiciary as extra constitutional, was recently authored by Doug Cassel and circulated by the influential American Society of International Law. (Cassel 2009). Professor Cassel is a member University of Notre Dame Law School and a former member of the ASIL Executive Council. The purpose of this short essay is to engage with this effort to find a principled theoretical justification for external projections on internal constitutional issues of a state. While Professor Cassel does an excellent job of presenting the case for international oversight of internal constitutional development within Honduras, I am less convinced that this case overcomes the initial hurdle—the legitimacy of constitutional interpretation by people or institutions other than those specifically vested with that power within the Honduran constitutional order. It is ultimately that weak link that may cause his conceptual house to collapse. For if he is right, it is possible to argue that any action that arguably shifts power among constitutional actors is now subject to reconsideration and redetermination of legitimacy by the community of states applying their own standards. At its most radical, Professor Cassel opens the door to the idea that national constitutional systems are now subordinate to an international network within which ultimate authority over constitutional law may now be vested. (Contrast Medellin v. Texas 2009). Professor Cassel points the way to an internationalization of constitutional law, though, ironically, not its juridification. (Contrast Herschl 2004).

Professor Cassel starts with a succinct summary of the events leading to the removal and expulsion of then President Zelaya. (Cassel 2009, at 1-2). He notes the messiness of the situation at the time of the events—Mr. Zelaya’s insistence on thwarting the will of the Honduran Supreme Court in a way that might well have resulted in his lawful impeachment and removal under American Constitutional law principles under similar circumstances. He also notes the conformity of the succession to Honduran constitutional law. Likewise he notes that irrespective of the legitimacy of the removal, that the expulsion contravened the black letter fo the Honduran Constitution. (Id., at note 1). He also notes the unorthodox and ex post ham handedness of the removal itself. But then he makes a leap of faith:

“In short, after being forced out of the country in breach of the Constitution, President Zelaya was formally deposed by a Congress with no clear constitutional power to remove him in the circumstances at hand, let alone summarily, without so much as a hint of due process of law. This was indeed a coup d’état (even if the relative degrees of responsibility of the civilian and military authorities for the coup remain unclear).”

Why a leap?: because the conclusions and judgments with which those statements are laced were not the product of deliberations by the Honduran Supreme Court, and thus definite within the framework of Honduran Constitutionalism. Instead, at best, it represents the extra judicial determination of an outsider made without the benefit of the protections and framework for resolving such disputes within the Honduran Constitutional system. This is judgment without authority or legitimacy (in law). This is not to fault Professor Cassel; he engages in the sort of judgment that is at the core of the academic project. But it interposes a person (or in the case of the United Nations or the OAS) whose pronouncements, and actions thereon, are treated as if they constituted the definitive judgment of the duly constituted organs of the Honduran state acting within the legitimate scope of their authority. It is on this judgment that the international law arguments, thereafter elaborated, are based. But such arguments, in the absence of authoritative action by the duly constituted authority charged with that task, renders that argument less legitimate as a matter of law, and ironically, might serve to subvert the internal democratic order in Honduras even as it seeks to vindicate it. So I start where I will end—no action grounded in purported attempts to preserve the democratic order in Honduras can be legitimate unless based on judgments by the duly constituted organs of that order with respect to the operation of Honduran constitutionalism. The great problem of transnational constitutionalism in Honduras is the problem of avoiding international enforcement of the constitution that that actors think Honduras ought to have rather than the one that the sovereign people of Honduras have adopted. To act otherwise, perversely enough, is to advance the constitutional project that was the catalyst to Mr. Zelaya’s ouster in the first place.

Starting from the judgment that the actions of the Honduran legislature and court amounted to a coup d’etat, Professor Cassel constructs an argument for the legitimate intervention of the international community to determine the way in which the internal constitutional dispute in Honduras ought to be resolved. (Cassel 2009, 3-5). The argument is both elegant and instructive. He starts with a set of basic premises that are grounded in the core premises of transnational constitutionalism as applied in the context of Honduras: The Interamerican Democratic Charter, though neither law nor transposed into the domestic legal order of Honduras by other means, is nonetheless an authoritative interpretation of the OAS Charter and therefore binding on all of its members (including presumably the United States). Combining the two one arrives at what Professor Cassel suggests is an appropriate standard for reviewing the legitimacy of the actions of the Honduran legislative and judicial branches—though Article 9 of the OAS Charter permits suspension if a democratically constituted government is overthrown by force, the Democratic Charter extends that power to what it terms “unconstitutional alteration of the constitutional regime.” (Id., at 3). This presents a dilemma that Professor Cassel nicely captures:

This poses a challenge for international lawyers. Ordinarily international law imposes its own, autonomous norms for the permissible conduct of a government. Questions of domestic law – including constitutionality – are left to domestic authorities, both as a matter of their sovereign entitlements, and because they are presumed better able to interpret their own constitution. (Id.).

But rather than suggest that, in the face of this constraint, the appropriate action might have been to seek an authoritative interpretation of the Honduran Constitution, Professor Cassel suggests that the internal constitutional standards of the Member States count for little in this matter. All states, including the United States it would seem, are instead subject to a higher legal standard through which their compliance with their own constitutional framework is legitimate and authoritative (at least with respect to the application of OAS Charter art. 9: rather than domestic standards, international standards apply to a determination of national compliance with their own constitutional norms. “this requires international lawyers – and other OAS member states – to consider whether domestic authorities have breached their own constitution, in order to evaluate whether they meet their international commitments.”

We now have the answer to the initial question of the constitutionality of the actions by the Honduran courts and legislature—that is an issue that may be determined by others, outside of Honduras, on the basis of international standards now written into the fabric of Honduran constitutionalism and imposed on them by virtue of their membership in the OAS community of nations. In effect, Professor Cassel argues, once outsiders determine that they do not trust a duly constituted branch of a Member States’ government, it is free, in intervening, to make its own determination of the proper answer to domestic constitutional questions, “lest de facto regimes be given carte blanche to fabricate their constitutionality.” (Id., at 3). But here, the regime is not “de facto” in the sense that the government has been overthrown and replaced by another. Instead, the President has been removed and the legislative and judicial branches continue to function uninterrupted. To suggest the profound effects of this removal in this context is to void a judgment for imposition of improper remedy. That, also, might be understood as both undemocratic and illegitimate.

On this basis, Professor Cassel makes out his case for the constitutional illegitimacy of Mr. Zelaya’s removal and exile. (Id., at 3-5). He makes excellent points, and strong arguments about the constitutional infirmity of the actions of the Honduran courts and legislature. But those arguments are authoritative only because of the initial presumption that these determinations may no longer be put to the highest interpretive authority of the Honduran Constitution. More interestingly, though, is the use of international standards to reach into the Honduran Constitution itself to void, as a matter of international law, a black letter provision of the constitution (at least as to one of its possible legitimate interpretations). For Mr. Cassel, Art. 239 of the Honduran Constitution is problematic at best (id., at 4-5) or at worst, “is inconsistent with Honduras’ treaty obligations, violative of due process of law, and anti-democratic.” (Id., at 5). Again, Professor Cassel suggests one of the interesting consequences of transnational constitutionalism—the ceding of a power over interpretation from the state to the community of states, which can serve to limit the possible permissible interpretations of a national constitution by its Supreme Court. As an aside, and somewhat perversely, for Professor Cassel’s arguments to work, one would have to believe Mr. Zelaya, before his ouster, that only the President was the legitimate nexus of constitutional authority within Honduras. But that, itself, suggests an unconstitutional alteration of the Honduran State that might be subject to OAS sanction.

But the government of a state is not incarnated in the body of its president. To suggest that is to move us closer to notions of monarchical organization that many states have labored hard over the last several centuries to abandon. Mr. Zelaya was one, but only one part of a democratically elected government in which power was divided among the legislature, the executive and the judiciary. Contests among those three branches, and their outcomes, however messy, do not raise the same issues as those raised by the projection of power from within—in the form of military or other outside actors, to usurp power for themselves—or from without. Honduras has not changed its form of government, nor are outsiders now in control of the apparatus of state. That the current government was likely formed in a manner that is constitutionally illegitimate raises internal questions of constitutional law. The OAS might have better spent its time seeking agreement by the Honduran state to put those questions to its Supreme Court. The conduct of that Court and its deliberations might well have served as an indication of the continued adherence of the Honduran State to the rule of law and its own democratic values. But that approach was never in the cards. And that is a shame.

Still, on this basis, Professor Cassel would put the threshold legal questions to rest:

the purported removal and replacement of President Zelaya were, in the words of the Inter-American Democratic Charter, an “unconstitutional interruption of the democratic order.” Whatever one’s views of the president and his prior conduct, the June 28 coup was an assault on constitutional order. If allowed to stand, it will become a menacing precedent for democracy, not only in Honduras, but throughout the hemisphere. (Id., at 5).

Professor Cassel does raise a powerful point—the nature of the obligations of the international community in the face of constitutional crises within a Member State. Mr. Zelaya is likely due compensation for the wrongs done to him—and principally his expulsion. He ought to have his day in court—and face trial and its consequences. The issue of the appropriate procedures for removal ought to be considered by the Honduran Court, and those who deliberately acted in contravention of Honduran constitutional norms, as applied, ought also to face Honduran justice. And the international community might work diligently to see to it that these things occur. That might be the approach of a system in which national constitutional expression is understood as the highest source of law within a state. Yet the basic issue remains—may the OAS now function effectively as the Supreme Court of Honduras and base their action on its conclusion about the application of the Honduran Constitution on the basis of domestic or international principles and standards?

Professor Cassel reminds us that this is no longer the case, at least for small states. Transnational constitutionalism is now becoming better established. For the good, it represents an orderly means through which a great single normative framework may be developed and applied to all states seeking membership in the community of legitimately constituted democratic states. It brings into play the great ideals of the American government which grounded its approach to the constitutions that emerged in Germany and Japan after the Second World War. But the implications of a more robust transnational constitutional system, nicely expressed by Professor Cassel, might be more than Americans have bargained for, especially if applied to them. On the other hand, whatever sort of transnational constitutionalism Americans put the weight of their authority behind, ought to be one that Americans are willing to apply to themselves. It is unlikely that this will be the case. (Medellin v. Texas 2008).

Whatever the result, it appears that “In the end, there is very little that may be Honduran about the ultimate result of those Revolutions. That question will be decoded by forces outside of the state and serving the geo-political, ideological and strategic interests of others. Post modern sensitivity developing nations has produced a variety of post colonialisms form the left and the right and from the developing and developed centers of power.” (Backer July 4, 2009). Even for defenders of transnational constitutionalism, and there are many reasons for defending the construction of a more robust system of transnational constitutionalism, it might be wise to cultivate not only a consensus about the outer boundaries of legitimate constitutionalism but also a greater sensitivity to allowing the people of a state to make those determinations for themselves in the first instance.

References

ALBA condemns Honduran coup, Zelaya participates meeting, People’s Daily Online, June 29, 2009.

Larry Catá Backer, Reflections on the Declaration of Independence: From a Crisis of U.K. Constitutionalism in the Americas to a Global Constitutional Crisis in Honduras, Law at the End of the Day, July 4, 2009 (http://lcbackerblog.blogspot.com/2009/07/reflection-on-american-independence-in.html).

----------, From Constitution to Constitutionalism: A Global Framework for Legitimate Public Power Systems, Penn State Law Review, Vol. 113(3):671-732, (2009). Available at SSRN: http://ssrn.com/abstract=1272264.

----------, God(s) Over Constitutions: International and Religious Transnational Constitutionalism in the 21st Century, Mississippi Law Review, Vol. 27:11-65 (2008) available at SSRN: http://ssrn.com/abstract=1070381.

Doug Cassel, Honduras: Coup d’Etat in Constitutional Clothing?, American Society of International Law ASIL Insight 13(9) July 29, 2009, available http://www.asil.org/insights090729.cfm.

Congreso destituye a Zelaya y Roberto Micheletti asume como nuevo Presidente, Noticias 24, June 28, 2009

Radhika Coomaraswamy, Uses and Usurpation of Constitutional Ideology, in Constitutionalism and Democracy: Transitions in the Contemporary World 159-172 (Douglas Greenberg, et al. eds., New York, Oxford University Press, 1993).

EU Suspends $90 million Aid to Honduras, BBC News Online, July 13, 2009.

Louis Henkin, John Marshall Globalized, 148 PROC. AM. PHIL. 53 (March 2004).

Ran Hirschl, The Theocratic Challenge To Constitution Drafting In Post-Conflict States, 49 Wm. & Mary L. Rev. 1179 (2008).

----------, TOWARDS JURISTOCRACY: THE ORIGINS AND CONSEQUENCES OF THE NEW CONSTITUTIONALISM (Cambridge, MA: Harvard University Press, 2004).

Latin America: Coups and Constitutions, BBC News On Line , June 30, 2009.

Medellin v. Texas, 552 U.S: -- (2008).

H.W.O. Okoth-Ogendo, Constitutions Without Constitutionalism: Reflections on an African Political Paradox, in CONSTITUTIONALISM AND DEMOCRACY: TRANSITIONS IN THE CONTEMPORARY WORLD 65-80 (Douglas Greenberg et al. eds., New York, NY: Oxford University Press, 1993).

Organization of American States, General Assembly, AG/RES. 1 (XXXVII-E/09) (July 1, 2009), 37th Sess., OEA/Ser.P/XXXVII-E/09 (2009), ¶1.

Q&A: Crisis in Honduras, BBC News On Line, July 5, 2009.

Jed Rubenfeld, Unilateralism and Constitutionalism, 79 N.Y.U. L. REV. 1971 (2004).

United Naitons, G.A. Res. 63/301, U.N. Doc. A/RES/63/301 (July 1, 2009)

Democracy Part XVII: On the Legislature as an Aggregation of Interests and the Role of the Electorate in Representative Democracies

Some of the best contemporary political theory is being developed by those without oblivious to the role they play. A very real sense of both the source and content of modern political theory of representative government in the United States was much in evidence in a recent report circulated in that influential news periodical--Time Magazine. Karen Tumulty, Health Care Reform After Kennedy: A Scaled Back Bill, Time Magazine, Aug. 28, 2009. The story is focused on an issue of the day: "So what effect will his passing have on the prospects for health reform? Will his mourning colleagues suddenly be inspired to put aside their long-standing partisan and ideological differences, to get it done as a tribute to him, with the bill named in his honor, as many have suggested?" Id. But in seeking answers to that question, the article posits a fairly sophisticated and interesting insight into the nature of democratic political organization in the United States:

Another problem with trying to write a scaled-back bill is that so many elements of health reform are interconnected, politically and substantively. Take, for instance, the so-called individual mandate — a requirement that people buy coverage if their employers do not provide it (and the proposed employer mandate to require most employers to provide it is one of the things most likely to be jettisoned). Making an individual mandate work requires subsidizing people who could not buy insurance on their own, and that is expensive. Cut the subsidies and the mandate back too far, and insurance companies — deprived of the millions of new paying customers promised under broader proposals — could end their support of the deal, which would include new requirements that they sell affordable policies to people with pre-existing conditions. Id.

Now buried in the strategic angle that is the object of the analysis are insights about the organization of power around the representative organs of the American state apparatus that suggests the ways in which the legislature might be representative--but of organs of powerful stakeholders as well as a politically diffuse and passive electorate. It appears that health care reform requires the support not so much of the electorate as of the stakeholders whose interests will be affected by the way in which the measure is constructed. It appears that the insurance interests have something like a veto on the shaope of the legislation. Perhaps for that reason the legislature was less free to consider alternatives that might have cut the insurance industry out of the picture. But that unity of interests between insurance companies and the apparatus of state is also incestuous--the United States government has invested heavily in the business and operations of the insurance industry, especially since the start fo the economic crisis. And so, it is possible to conclude that minding the interests of the insuranec industry is tantamont to minding the commercial (indirect) interests of the state apparatus.

Of course, the polity still matters, in a sense. The legislature is mindful of current public opinion. "But support for the entire exercise is dropping in the polls, especially among independents and older Americans. Increasingly, Democrats are talking privately of the need for a big September relaunch." Id. And, indeed, for many, the story represents nothing more than business as usual and therefore nothing of interest as theory. American politics has always been dominated by a theory of the polity as both passive reactive. It has also become comfortable with the notion that stakeholders other than the electorate ought to be influential in the process of shaping policy and legislation. All sectors of American society is more or less comfortable with the idea that such stakeholders, like anyone else, is free to engage in the sort of activities that might mold the opinion of the polity and its expression at the polls form time to time. Americans have even become comfortable with the idea, as a sort of applied mass politics theory, of the use of polls as a substitute for elections to determine the willingness of legislators to engage in political activity.

All of this is the ordinary stuff of American mass politics applied. But what represents an advance is the willingness to abandon the nice formal veil between stakeholders and the legislature itself. It appears that stakeholders, like the insurance industry, now has a more open and formal place in the negotiation over the direction and scope of legislation. Communities of interest now move one step closer to recognition as independent members of the political community. Bolivia has already recognized the constitutional role of communities within its system. See Larry Catá Backer, Democracy Part VII: Constitutionalism and Indigenous Peoples in the Bolivian Constitution, Law at the End of the Day, Dec. 9, 2007. Perhaps Americans are moving in that direction as well. Now that is an advance in theory worth exploring.

Is Shar’ia Only for the Poor and Illiterate?: On Customary, Positive and Higher Law in Mali

Law has been assuming an increasingly protean character as we move into the 21st century. Though for the greater part of the last century global elites have been seeking to educate the masses, on whom political rights have been increasingly vested, that there is a hierarchy of law that must be understood and respected. With the rise of mass political rights has come a theoretical structure meant to sharply cabin the sources and authenticity of law. Mass democracy has produced a tendency towards tightly controlled aristocracy in systems for the identification, control and expression of the popular will. Larry Catá Backer, From Constitution to Constitutionalism: A Global Framework for Legitimate Public Power Systems, Penn State Law Review, Vol. 113, No. 3, 2009.

At the top of the hierarchy is positive law. The highest form of positive law is now understood as positive law—the law that is adopted by or on behalf of the people of a state and representing their direct and superior will. This “higher” law of the constitution is usually understood as consisting of two parts, process protections—the rules that ensure that all actions will be undertaken under law—and substantive protections—that certain values will be respected or furthered in the conduct of governmental affairs. See Larry Catá Backer, The Rule of Law, the Chinese Communist Party, and Ideological Campaigns: Sange Daibiao (the 'Three Represents'), Socialist Rule of Law, and Modern Chinese Constitutionalism, Journal of Transnational Law and Contemporary Problems, Vol. 16, No. 1, 2006.

Beyond higher law, statutory and administrative law represents the highest and most legitimate form of law making. It is said to derive indirectly from the people—as positive acts of their representatives who are vested with the only legitimate authority to make rules binding on the people living in the nation. The only limits of those lawmaking powers are said to be contained in the higher law of the constitution, and in the legitimate pronouncements of international bodies (of which there are few). See, Larry Catá Backer, God(s) Over Constitutions: International and Religious Transnational Constitutionalism in the 21st Century, Mississippi Law Review, Vol. 27, 2008. As long as matters are legitimately considered and undertaken in accordance with (higher) law, and as long as administrative measures are executed in compliance with (any) law, then the actions are legitimate and authentic. But as a result—only those actions which are the expression of the popular will constituted as one or another organ of the apparatus of state can serve as a legitimate source for such expressions of political power. Positive law theory is useful not only for locating law in the structures of sovereignty but also for marginalizing the customs, mores and habits of the populace, and their validation through instrumentalities of state (for example—the courts). It is both a matter of theory and power.

Beneath the majesty of these positive expressions of the will of the sovereign, however such sovereign is symbolically or actually represented within the apparatus of government, is customary law and religious law. Custom has been viewed, for the greater part of the last century, as primitive and undeveloped by most members of the legal and political elites in the West. Customary law cannot be effectively controlled by the machinery of state—and to that extent serves as a counterweight to the political classes. In countries that developed form out of common law customary traditions, customary law us viewed as a direct threat and limit to the power of the state, in the form of an independent judiciary and lawyer class. See, Larry Catá Backer, Reifying Law: “Let Them Be Lions,” Law at the End of the Day, Oct. 22, 2006; a later version published as Symposium: Law and the State in the Transnational Legal Order: Reifying Law: Understanding Law Beyond the State, 26(3) PENN STATE INTERNATIONAL LAW REVIEW 521 (2008). This tension was classically expressed in England in the great contests between James I and Coke in the early 17th century. It has found a modern expression in the judiciary and lawyer resistance to interference with their prerogatives by the government of former President Musharraf. See Lawyers Protest Against Musharraf, BBC News Online, March 12, 2007. But customary law also makes change much more difficult. When balanced by a legislature with power to move change along, the system tends to work well. That has been the idea, at least since the time of Aristotle. See Aristotle, Politics (350 B.C.E.). And it marked the relationship between customary law and legislative enactments in common law countries through the middle of the 19th centuries.

Religious law in the West was viewed in a similar light. It rested on the pronouncements of an institution that competed with the state for control of the machinery of control of individuals. But its control tended to be both overbroad and under inclusive. It was overbroad because religion tended to legislate for people irrespective of political citizenship. It sought to reconceived borders—not based on territory so much as on membership within the community of the faithful. Religion was also severely under inclusive, especially in those states where more than one religious tradition prevailed. In those contexts, of course, difficulties arose of a kind similar to those that follow when two states seek to rule the same land. In the West, since the 16th century, religion has not been so much defeated as co-opted by the state. It is this sensibility that has been cultivated by global elites since the middle of the last century in the construction of global legal culture. Law is very strictly and specifically defined. Its control is vested in certain political classes that adhere to certain rules of engagement with notions of mass democracy. And everything else is relegated to subordinate position as “mere” governance, religion, social practice, habit or “primitive” custom unaided by the wisdom of the will of the people specifically expressed through legislatures or the like. In return for cultivating a culture of legal hierarchy thus constituted, the masses are to be permitted a share of political citizenship. But law, like political citizenship, is to be tightly controlled to ensure direction in the organic development of society and the systems for its constraints. This structuring works as well in the West as it does in advanced Marxist Leninist systems. See, The Party as Polity, the Communist Party, and the Chinese Constitutional State: A Theory of State-Party Constitutionalism, Journal of Chinese and Comparative Law, Vol. 16, No. 1, 2009; Penn State Legal Studies Research Paper No. 05-2009.

In other parts of the world, of course, these truisms tend to be upended in peculiar ways. In the dar al-Islam, “higher law” is provided by religion—rather than the sovereign acts of the people constituted as states. In those places, states, popular sovereignty, positive law and even custom must necessarily be subordinate to the will of the divine force that supplies the basic process and substantive rules for the organization of society. There heresy substitutes for treason, religious loyalty for state loyalty and the power of the clergy for that of the judiciary and autonomous lawyer classes as the supreme expression of legal authority. See Larry Catá Backer, Theocratic Constitutionalism: An Introduction to a New Global Legal Ordering, Indiana Journal of Global Legal Studies, Vol. 16, No. 1, 2008; Islamic Law and Law of the Muslim World Paper No. 08-44.

That is not to say that what appears to Western sensibilities as the structure of states and the positionality of law does not exist. Not at all. There is plenty of that in evidence all over the world. It is rather that all of those indicia of Western legal “civilization” is always implicitly or explicitly subject to the higher law constraints of the Divine Constitution under which those who control the state apparatus operate. That, rather than notions of the “will of the people” or the “customs and laws of the community of states” tend to serve as the limits of power and the source of the legitimacy of all political acts, however undertaken. Results may be similar across systems but the pathways to those results are quite dissimilar and consistency or harmony is never assured, or even assured for long if actually attained form time to time.

The result, of course, is a certain absurdity and incomprehension when systems seek to communicate across large conceptual divides. More tragically, there is also a certain perverse absurdity when systems attempt to translate hierarchies of legal authority across systems whose acceptable legitimating lines of authority are incompatible. Mali sits at such a nexus point of positive, customary and religious law, in a state that seeks to maintain its status as both a republic conforming to global elite norms and a subsidiary territory of the dar al Islam, whose paramount constitution.

The Malian Constitution affirms both the democratic and pluralist character of the state, as well as the secular character of the state apparatus, in the French style. The Preamble provides in part a declaration of the sovereign people of Mali of their determination to “s'engage solennellement à défendre la forme républicaine et la laïcité de l'Etat, - proclame sa détermination à défendre les droits de la Femme et l'Enfant ainsi que la diversité culturelle et linguistique de la communauté nationale.” La Constitution du Mali, DECRET N° 92-0731 P-CTSP, Portant Promulgation De La Constitution (“to solemnly defend the republican form and the secular character (laïcité) of the state; and proclaimed their determination to defend the rights of women and children, the cultural and linguistic diversity of the national community). For an excellent accounting of the French concept of laïcité form a comparative perspective, see Elizabeth Zoller, Laïcité in the United States or The Separation of Church and State in a Pluralist Society, 13(2) Indiana Journal of Global Legal Studies (2006).

The Malian Constitution provides a traditional Western basis for the organization fo the state. Article 4 proclaims the religious rights of Malian citizens— “Toute personne a droit à la liberté de pensée, de conscience, de religion, de culte, d'opinion, d'expression et de création dans le respect de la loi.” ( Article 4: Every person has the right to freedom of thought, conscience, religion, worship, opinion, expression, and creation in respect to the law.). More to the point, Article 28 of the Malian Constitution requires all political parties to respect the principles of national sovereignty, democracy, territorial integrity, national unity and laïcité. (“Les partis concourent à l'expression du suffrage. Ils se forment et exercent librement leurs activités dans les conditions déterminées par la loi. Ils doivent respecter les principes de la souveraineté nationale, de la démocratie, de l'intégrité du territoire, de l'unité nationale et la laïcité de l'Etat.”). Most importantly, and in a way similar to that of the German Basic Law, the Malian Constitution provides, in a critical provision, that certain of its provisions may not be abandoned or modified without rejecting the Malian Constitutional system as a whole. Those provisions that may not be revised, tellingly, include any that affect the republican character of the state, the basis of the political sysem in multi party democracy and the foundational substantive constitutional norm of laïcité. Malian Constitution Art. 118 (“La forme républicaine et la laïcité de l'Etat ainsi que le multipartisme ne peuvent faire l'objet de révision.”).

Yet this globalist overlay appears to sit precariously atop a society grounded in both customary law and in notions, increasingly politicized in the last several decades, of the paramount role of Islam in determining the political character of the state and its laws. Thus the BBC recently reported on the effect of an attempted passage of a law changing the status of women, rules of marriage, and rights of children born outside of marriage in Mali.

Tens of thousands of people in Mali's capital, Bamako, have been protesting against a new law which gives women equal rights in marriage. . . . The head of a Muslim women's association says only a minority of Malian women - "the intellectuals" as she put it - supports the law. Several other protests have taken place in other parts of the country. The law was adopted by the Malian parliament at the beginning of August, and has yet to be signed into force by the president. One of the most contentious issues in the new legislation is that women are no longer required to obey their husbands. Mali protest against women's law , BBC News Online, Aug. 23, 2009.

Most telling, perhaps, was the great disjuncture between the lofty words of the Malian Constitution, and the power of customary and religious mores for framing the legitimacy of the provisions at issue. “Hadja Sapiato Dembele of the National Union of Muslim Women's Associations said the law goes against Islamic principles. "We have to stick to the Koran," Ms Dembele told the BBC's Focus on Africa programme. "A man must protect his wife, a wife must obey her husband." "It's a tiny minority of women here that wants this new law - the intellectuals. The poor and illiterate women of this country - the real Muslims - are against it," she added.” Mali protest against women's law, BBC News Online, Aug. 23, 2009.

And thus a great divide across the great rifts that tend to define the internal sociological internal boundaries within a state—cultural, religious, class, and gender. In one sense, for example, Ms. Dembele appears to suggest that religious laws are fit only for the poor and illiterate. That, certainly is how an individual might choose to read the passage—and that would accord with deeply held beliefs about the hierarchy and legitimacy of law, as well as of the relationship of law to state and non state organs. Yet on the other hand, what Ms. Dembele appears to be saying is that there is a disconnect between the Malian elite—comfortable members of a global community of like minded individuals sharing a common set of political values—and those individuals who remain committed to traditional Malian mores—comfortable with the primacy of both custom and religion as the paramount source of substantive political values and as a check on the power of the state to compel.

From the perspective of the Malian constitution, and the mores of the community of nations whose values are elaborated within the Malian constitution, the actions of protestors are incomprehensible in political terms.

At the end of the demonstration, leading imams and Muslim scholars issued a statement saying the new law "violates several articles of faith, teachings of the Koran and traditional values of the Malian people." They said they had decided to boycott the lawmakers and non-governmental organisations who supported the legislation. "We will not have anything more to do with them or their families ... They are traitors to Allah," they said. Demonstrators protest laws strengthening women's rights, France 24, Aug. 23, 2009.

Yet from the perspective of another segment of Malian society, it is the norms permanently enshrined in the Malian Constitution itself that is either incomprehensible, or at any rate subject to the limiting power of a paramount law. While these disparate perspectives might be managed, it is unlikely that they will be harmonized. This is a problem not solely for the Malian elites, but for all of those who have believed that a global consensus on legal hierarchy and legitimacy has been attained. Even within the shrinking ambit of law effectively controlled by the state and its apparatus, the issue of the character of legitimate law making will remain a lively one this century.

ISO 26000: Working on a Common Global Language of Corporate Social Responsibility

A new governance environment requires a common language. The entity that controls the construction of that common language will, effectively, also control the underlying parameters and normative framework which that language describes. The power of concepts are encapsulated in the words and standards chisen to describe them. Words and words that describe also tend to force the eye, and the mind, in particular directions. Even description includes in its essence, decisions about what is important, what serves as the essence of the thing described.

Corporate social responsibility has been the object of such a search for a common language for the last generation. While states continue to ignore the issues--tending toward self absorption in the intricacies of their narrow minded legal constructs of corporate governance--other governance communities are quickly moving to supply (and thus control) the language by which we describe (and understand) the subject.

There is an important player in the contests for control of the descriptive realities (and normative understanding) of corporate social responsibility, a player whose work is well worth following. That player is the International Organization for Standardization. According to it, ISO "is the world's largest developer and publisher of International Standards. ISO is a network of the national standards institutes of 162 countries, one member per country, with a Central Secretariat in Geneva, Switzerland, that coordinates the system." ISO, About ISO. ISO represents a body for inmformal consensus among the most important elelemt of glopbal elites in the public and private sectors. "On the one hand, many of its member institutes are part of the governmental structure of their countries, or are mandated by their government. On the other hand, other members have their roots uniquely in the private sector, having been set up by national partnerships of industry associations." Id. ISO has been a critically important player in the harmonization of standards in a number of areas. Its Strategic Plan for 2005-2010 are meant to support global trade, corporate social responsibility and global disseminaiton of technology in aid of development. Id., at 2. To that end it has embraced seven key objectives: (developing a consistent and multi-sector collection of globally relevant international standards; (2) ensuring the involvement of stakeholders; (3) raising the awareness and capacity of developing countries; (4) being open to partnerships for the efficient development of international standards; (5) promoting the use of voluntary standards as an alternative or as a support to technical regulations; (6) being the recognized provider of international standards and guides relating to conformity assessment (and importantly, "their use and referencing by regulators in sector initiatives when conformity assessment is involved" Id., at 5); and (7) providing efficient procedures and tools for the development of a coherent and complete range of deliverables. Id., 3-6.

A key area for development of these strategic objectives is penetration of the market for a language of corporate social responsibility. "The need for organizations in both public and private sectors to behave in a socially responsible way is becoming a generalized requirement of society. It is shared by the stakeholder groups that are participating in the WG SR to develop ISO 26000: industry, government, labour, consumers, nongovernmental organizations and others, in addition to geographical and gender-based balance." ISO, Social Responsibility." It is no wonder, then, that "ISO . . . has decided to launch the development of an International Standard providing guidelines for social responsibility (SR). The guidance standard will be published in 2010 as ISO 26000 and be voluntary to use. It will not include requirements and will thus not be a certification standard." ISO, Social Responsibility.

This is an effort in which the United States has not taken the lead. Instead, "ISO has chosen SIS, Swedish Standards Institute and ABNT, Brazilian Association of Technical Standards to provide the joint leadership of the ISO Working Group on Social Responsibility (WG SR). The WG SR has been given the task of drafting an International Standard for social responsibility that will be published in 2010 as ISO 26000. " ISO, Social Responsibility. According to the ISO, the object of this new standard includes the following:

• assist organizations in addressing their social responsibilities while respecting cultural, societal, environmental and legal differences and economic development conditions;
• provide practical guidance related to operationalizing social responsibility, identifying and engaging with stakeholders, and enhancing credibility of reports and claims made about social responsibility;
• emphasise performance results and improvement;
• increase confidence and satisfaction in organizations among their customers and other stakeholders;
• be consistent with and not in conflict with existing documents, international treaties and conventions and existing ISO standards;
• not be intended to reduce government's authority to address the social responsibility of organizations;
• promote common terminology in the social responsibility field; and
• broaden awareness of social responsibility.

ISO, Social Responsibility, About the Standard. While the overall object is to create a common language for corporate social responsibility--"Our work will aim to encourage voluntary commitment to social responsibility and will lead to common guidance on concepts, definitions and methods of evaluation" ( ISO, Social Responsibility)--the standard has a broader reach. Most interesting, of course, is the object to operationalize social responsibility. In this context, at least, ISO will be working in parallel with John Ruggie and the U.N.'s work on operationalizing a normative framework for multinational corporaitons and human rights. John Ruggie, Towards Operationalizing the Protect, Respect and Remedy Framework: A Progress Report, A/HRC/11/13, 22 April 2009.

In its 2008 annual report, ISO explained: "Refined to its essence, the objective of ISO standards is to provide confidence," the report states. "When a product or service meets the specifications or requirements of an ISO standard, this provides confidence that they incorporate essential features. These features can include quality, ecology, safety, reliability, interoperability efficiency and effectiveness. ISO standards also help to ensure such benefits at an economical cost." ISO Annual Report, 2008, at 2. It will be a small step from control of language to control of the framework through which governance will be effected.

The ISO is movingcloser to publishing a final version. "Consensus was achieved among the multi-stakeholder participants in the ISO Working Group on Social Responsibility (ISO/WG SR) at its latest meeting on the way forward for the future ISO 26000 standard. The group's 7^th plenary meeting, held in Québec City, Québec, Canada, on 18-22 May 2009, addressed issues stemming from the more than 3 000 comments submitted in a successful vote on the Committee Draft of the standard taken before the meeting. ISO 26000 is now moving to the status of a Draft International Standard by October 2009." ISO, Extensive debate improves consensus on future ISO 26000 standard on social responsibility, Ref. 1229, June 4, 2009. It was also reported that "The Québec meeting stakeholder dialogue resulted in moving ISO 26000 closer to completion on complex issues such as barriers to trade, human rights and user friendliness." Id.

The current committee draft, ISO/CD 26000, Guidance on Social Responsibility, 2 ISO/TMB WG SR N 157 (2008-12-12), is now available and related documents may be accessed at http://www.iso.org/wgsr. "This International Standard provides guidance on the underlying principles of social responsibility, the core subjects and issues pertaining to social responsibility (see Table 2) and on ways to integrate socially responsible behaviour into existing organizational strategies, systems, practices and processes (see Figure 1). This International Standard emphasizes the importance of results and improvements in performance." ISO/CD 26000, Guidance on Social Responsibility, 2 ISO/TMB WG SR N 157 (2008-12-12), at page 6, lines 109-112. I will review the committee draft in a later post. I will note three things. First, the conceptual basis of ISO 26000 moves away from the bedrock concept of economic organization as centered on the maximization of the welfare of shareholders. Second, it deepens what is now a clear movement away from a monopoly of corporate governance regulation grounded in the state (whether the state of incorporation or the state in which the entity operates). Third, lawyers and policy makers in developed states, and especially the United States, will continue to ignore these governance frameworks at their peril. Corporate gopvernance is no longer focused on an eternal tension between the governance rights of shareholders, directors and officers. Nor is corporate governance merely the object of state law or even national policy. Governance of 21st century economic entities will not be grounded in the nostrums and basic assumptions that serve as the introduction to what passes for the study of the law of economic entities as taught in most American law schools. The development of a common language of corporate social responsibility, and the framework for corporate behavior, will loom large as the focus of business behavior, and lawyers' work in the decades to come. The content of that framework is what is today at issue.

Converging State and Economy: Further Reflections on the Rio Tinto Executives Arrest in China

The arrest of four Rio Tinto executives this summer has produced a significant amount of consequences for people interested in international relations, law, foreign investment and corporate governance. See, Larry Catá Backer, From Political to Economic Wrongs--The Rio Tinto Prosecutions in China, Law at the End of the Day, Aug. 13, 2009; Larry Catá Backer, State Owned Enterprises and the Integrity of Private Markets and Commercial Activity: On the Arrest of the Rio Tinto Executive, Law at the End of the Day, July 10, 2009. The episode has generated important interest in China as well as abroad. For an excellent review (in Chinese) see, 小心低调，力拓案的中国启示录 (Washington Observer Aug. 19, 2009).

An article published on a website controlled by the Chinese State Secrets Bureau also claimed that large amounts of “intelligence and data” had been found on Rio ’s computers following the arrest of four Rio executives on spying charges last month.

The report on baomi.org, a publishing affiliate of China’s national secrets watchdog, accused Rio of “winning over and buying off, prying out intelligence... and gaining things by deceit” during critical annual negotiations over iron ore prices.

Peter Foster, Chinese website slams Rio Tinto 'espionage’ , Daily Telegraph, Aug. 10, 2009. I was recently asked to consider further four questions concerning the arrest of Rio Tinto executives. The

1. Is the Rio Tinto's espionage case purely a commercial wrongs prosecution or might it be characterized in political terms as the Chinese government's revenge for the failure of Chinalco's purchase of Rio Tinto's asset, or as an indication of the rise of nationalism in the country? This question may most usefully be considered in three parts, each of which is briefly treated in turn.

The first is internal to China and deals with the application of political discretion in the prosecution of the laws of China. Prosecutorial discretion has become an increasingly controversial issue, not just in China, but in the West as well. The issue of prosecutorial discretion has become a matter of concern in international bodies as well, the International Criminal Court, for example. In this sense, China is no different from other states. However, because of its history, exercise of such discretion becomes a sensitive issue, especially where political crimes may be asserted against foreigners conducting ordinary business in China. The issue becomes more complicated in China where traditionally economic and political criminality were viewed as equivalent. But the Chinese have been moving diligently to a more conventional view of distinctions between political and commercial activity, based in part on the theories of Deng Xiaoping and its development through increasingly elaborated ideological development through the CCP. It was quite sensible for Chinese prosecutors to choose to proceed on the basis of the economic rather than the political character of the activities. Of course I have no basis for knowing the strength of the allegations or the likelihood of the success of the prosecutions.

The second is external and deals with the issue of Chinese-Australian relations. Both Chinese public and private investors, like other investors from foreign countries, have been frustrated with Australia's system of review of proposed in-bound foreign investment. From an Australian perspective, of course, the regulations are meant to protect Australian resources and economic development from hijacking by foreign public or private interests. From a Chinese perspective, though, the process might permit the Australian government to use the inbound investment process,especially when invoked by a Chinese state owned enterprise, as a means of effecting foreign policy rather than internal economic objectives. That might certainly be a reasonable view of the intensity of the Chinese frustration (by the state apparatus, the CCP and Chinalco) with its efforts to invest in a foreign natural resources entities. Indeed, it was reported today that as a consequence of the recent activity Australia is to ease its inbound investment review rules to fast track more applications by roughly doubling the minimum.

The third is cultural and deals with the issue of mass politics in China and its effects on both internal economic policy and external relations. Recall that these prosecutions have arisen not merely in the context of the somewhat difficult relations between China and Australia (on the one hand) and Rio Tinto and Chinalco (on the other hand). From the time of the development of the Harmonious Society (和谐社会) and Scientific Development (科学发展观) principles the Chinese state apparatus has been deeply involved in the issue of corruption. Anti corruption campaigns have sought to target all social, political and economic institutions--including the CCP itself. In that context, to the extent that economic crimes touch on corruption, there is bound to be a reaction that could be understood as nationalist. But, in a sense, the prosecution of the foreigners might also be a distraction from the continuation of the great work of Chinese officials against domestic corruption precisely because prosecutors chose to act against executives whose company is involved in a high stakes commercial transaction with a Chinese state owned enterprise. In this sense Rio Tinto is itself a great distraction even in campaigns against corruption by foreign individuals.


2. While China is quickly becoming an important player in the global business arena, might the Rio Tinto Executives' arrest and prosecution signal some sort of Chinese "pushback" by insisting that Chinese domestic politics factor into the management of free trade reghimes? It is hard to guess at the meanings that the Chinese State intended by the decision to prosecute the Rio Tinto employees, Certainly, it is reasonable to assume that some sort of pushback was intended when seen from outside of China--China was dealing with what appeared to be a political problem in the in-bound investment review by the Australian government, the entity seeking to make the investment was a state owned enterprise acting in accordance with a general mandate developed by the State Council and Rio Tinto appeared to continue to do business as usual within China. Other states have infused their domestic politics into the free trade game, the United States is no exception. But the problem is that the way China chose to act , at least in the foreign eyes, was far more aggressive than what would have been expected from another state in similar circumstances. And thus the fuss. Chinalco is not the state or part of its political apparatus. To conflate state owned enterprises and the business of the state apparatus makes for difficult issues of harmonious relations with foreign economic interests.


3. Has the Chinese media, in reporting the legal case, legitimately raised the issue of "multinationals' lack of legal responsibility"? Ought the issue of legal responsibility be grounded on a policy of legal rules that separate political and economic action? The issue of corporate responsibility, and especially the responsibility of multinational enterprises has been much in the press lately. It serves as a convenient scapegoat and distraction from the larger issues involved. On the one hand Chinese society remains sensitive to its position in the world in the context of the long period of quasi and partial colonialism through which it struggled in the 19th and 20th centuries. There is thus a great sensitivity to issues of equal treatment in general and special treatment for foreigners in particular. But the operation of multinational enterprises has become an issue of global concern. It is not clear that multinational enterprises operate in China in any way that is more disadvantageous than multinational corporate operations anywhere else. As Chinese multinational enterprises and state owned industries begin to engage in more economic activity outside of China, these entities will become the multinational corporations seeking to exploit other peoples. Like other states, Chinese officials will likely become more sensitive to the element of mutuality in the regulation of foreign elements within the national economy. On the other hand, in a world economy in which governments increasingly participate in markets like private persons, and multinational corporations are increasingly vested with regulatory authority in their relationships with suppliers, labor, and vendors it has become more difficult to separate political from economic matters. I have suggested that though it is more difficult to do so,the separation is useful and might still be effective if directed to the type of activity that is the subject of investigation rather than the character of the entity the is acting. In the economic context, activity that regulates the conduct of others is public and political, activity in markets is private and economic.


4. In the aftermath of the arrests, relations with Australia have been significantly affected; to what extent are these reactions likely to have permanent effect? It is one thing to make business more difficult for individuals from a non cooperative state; it is quite another to put those executives in fear of arrest without a better developed framework for understanding what is lawful and what is not--from conversations about market conditions to the engagement in due diligence investigations in connection with a commercial transaction, especially one that requires substantial investigation of the financial condition of a company that may be purchased. As a rule of law state, it makes sense for China to provide guidance for foreigners seeking to participate in Chinese economic and commercial life and to ensure that administrative officials adhere to those guidelines. The difficulty for China is that it will be very easy for that impression to become a consensus opinion among the foreign investment community in the wake of the Rio Tinto prosecutions that China is not moving in that direction. Chinese officials might find it useful to reassure foreigners about its intentions. The best way to do that, of course, is to develop rules and understandings about what precisely would constitute the sort of conduct that could lead to prosecutions under either the economic or political statutes and what sort of conduct would not.

I suspect that we have not seen the end of the consequences of the Rio Tinto executives arrest and prosecution. These events may serve as a catalyst for consideration not merely of the shape of state to state relations, but of the way in which state enterprises operate abroad, foreign investors engage in transactions with state enterprises, and the management of the intersection of state policy in the economic sector and public interventions in private markets through state enterprises. For a discussion of the way that these issues have become important in the development of sovereign investing in China, see, Larry Catá Backer, Sovereign Investing in Times of Crisis: Global Regulation of Sovereign Wealth Funds, State Owned Enterprises and the Chinese Experience(August 4, 2009), Transnational Law & Contemporary Problems, Vol. 19(1) (forthcoming 2009).

Caritas in Veritate: Developing a Roman Catholic Doctrine for Globalization, and a Values Based Corporate Social Responsibilty Framework

Ever since the 1980s and his personal confrontation, as Cardinal Ratzinger, with Catholic Marxist-Leninism in the form of Liberation Theology, Benedict XVI has been especially sensitive to the importance of a values based approach to economic organization and its implications within Church doctrine. See Instruction on Certain Aspects of the Theology of Liberation, given at Rome, at the Sacred Congregation for the Doctrine of the Faith, on August 6, 1984, the Feast of the Transfiguration of Our Lord, Joseph Cardinal Ratzinger, Prefect.

Early in his reign Benedict turned to the issue of values-based economics in the encyclical, Deus Caritas Est 2005.

Deus Caritas Est suggests a fully developed and sophisticated system of valuation for economic analysis. Economic values are essentially grounded in love, rather than in personal or aggregate wealth maximization. But love here is understood as the expression of a complex series of parallelisms. These start with the relationship between God and humanity—as expressed from the Old Testament to the meaning of the Incarnation (agape). That love finds expression in the love between man and woman, and then generalized as the love among individuals—both physical (and thus grounded in physical relationships) and perfectible (grounded in the need to mimic the love from God in the love of neighbor). From these foundations—divine love expressed in physical terms in the love among individuals within families and in communities, and among communities, is what is meant to serve as the maximizing value of economic analysis—not goods but the love value generated by interactions. Aggregate maximization of value, then, is not necessarily measured by wealth maximization in the form of the accumulation of lots of objects with a high market value (the conventional sense of classical economics and Marxist theory), but is measured in the production of good measured in terms of charity, and, in its modern understanding—social justice. Economics, then, is grounded in the study of systems for the maximization of social justice among individuals which itself is to be understood as an application of divine love in human relations. Larry Catá Backer, Values Economics and Theology: The Contribution of Catholic Social Thought and its Implications for Legal Regulatory Systems, Law at the End of the Day, January 12, 2008 (for a fuller treatment follow this link).

Benedict, of course, is not the first to seek a values based alternative to economics--as a basis for the formulation of governance policies. See, e.g., Louis O. Kelso and Mortimer J. Adler, The Capitalist Manifesto (New York: Random House 1958); Louis O. Kelso and Mortimer J. Adler, The New Capitalists: A Proposal to Free Economic Growth From the Slavery of Savings (San Francisco: The Kelso Institute, 2000). He is is hardly alone in seeking to articulate a normative framework for social and economic organization, one that can serve as the basis for law and governance. See, e.g., discussion by the contributors to Ethics in International Management (De Gruyter Studies in Organization , No 84) (Brij Nino Kumar and Horst Steinmann, eds., Walter de Gruyter (March 1998)) and Global Transformations: Politics, Economics, Culture (David Held, Anthony McGrew, David Goldblatt, and Jonathan Perraton, eds., Polity Press, 2003). Nor is he the first to challenge the normative framework (and thus the system of law and governance) on which the current model of liberal globalization is based. Compare Joseph E, Stiglitz, Globalization and Its Discontents (WW Norton, 2003), to Fidel Castro Ruz, On Imperialist Globalization (Zed Books Ltd (1 Feb 2003)) And lay people have also sought to ground the debate about economic organization in moral and religious terms. See, e.g., Rebecca Todd Peters, In Search of the Good Life: The Ethics of Globalization (Continuum Press, 2004). Yet, Benedict's long term project is itself an important and deliberate intervention in the governance debates about the role of the individual, the economic enterprise and the state, not merely as a matter of theology, but precisely because of its theological basis.

The critical relationship between a theological subtle deepening of notions of charity in a contemporary context, and the economic organization of society for "the good" has turned out to be the key to the elaboration of an application of notions of charity in the organization of globalization and the conduct of large corporations and other economic actors within it. This is not merely Church doctrine--something to be relegated to classes in theology. Rather, the doctrine was deliberately framed to serve as an important intervention in policy debates about the values incumbent on states to further as national policy and in the construction of interpretive agendas for basic principles of human rights. Doctrine, in this case, was to serve as the bedrock for the revaluation of the principles underlying law as applied to the economic sector by states, multinational corporations, supra state civil and political actors. See, e.g., Larry Catá Backer, Urbi et Orbi--Easter 2009, Law at the End of the Day, April 12, 2009; Larry Catá Backer, Ecce Homo: Reflections on Benedict XVI's Careful Comments to the United Nations, Law at the End of the Day, April 19, 2008.

Now the Pope has sought to refine the doctrine, the theological basis of his he earlier explored, in what is likely to be an influential encyclical, Encyclical Letter, Caritas in Veritate of the Supreme Pontiff, Benedict XVI, to the Bishops, Priests and Deacons of Men and Women Religious, the Lay Faithful, and All People of Good Will on Integral Human Development in Charity and Truth (June 29, 2009) (hereafter Caritas in Veritate). This refinement now begins to expose the social, legal and political consequences of Deus Caritas Est in two critical areas--corporate social responsibility and globalization governance. In this respect, the Church, quite correctly, joins an important discourse, the object of which is the control of the fundamental normative assumptions on which law and governance are based. On the ramifications of current efforts to internationalize the regulation of corporate social responsibility at the supra national level, see, Larry Catá Backer, Multinational Corporations, Transnational Law: The United Nation's Norms on the Responsibilities of Transnational Corporations as Harbinger of Corporate Responsibility in International Law, Columbia Human Rights Law Review, Vol. 37, 2006; Larry Catá Backer, Multinational Corporations as Objects and Sources of Transnational Regulation, ILSA Journal of International & Comparative Law, Vol. 14, No. 2, 2008.

Benedict XVI picks up the central theme of Deus Caritas Est early in Caritas in Veritate: " Charity is at the heart of the Church's social doctrine. Every responsibility and every commitment spelt out by that doctrine is derived from charity which, according to the teaching of Jesus, is the synthesis of the entire Law (cf. Mt 22:36- 40)." Caritas in Veritate, at Par, 2. Likewise, the Pope seeks to avoid any mistaking the implications of Deus Caritas Est:

I am aware of the ways in which charity has been and continues to be misconstrued and emptied of meaning, with the consequent risk of being misinterpreted, detached from ethical living and, in any event, undervalued. In the social, juridical, cultural, political and economic fields — the contexts, in other words, that are most exposed to this danger — it is easily dismissed as irrelevant for interpreting and giving direction to moral responsibility. Hence the need to link charity with truth not only in the sequence, pointed out by Saint Paul, of veritas in caritate (Eph 4:15), but also in the inverse and complementary sequence of caritas in veritate. Truth needs to be sought, found and expressed within the “economy” of charity, but charity in its turn needs to be understood, confirmed and practised in the light of truth. Id., at Par. 2.

And thus the connection--at once theological, social, legal and political--between charity, truth and the governance of human organization. "“Caritas in veritate” is the principle around which the Church's social doctrine turns, a principle that takes on practical form in the criteria that govern moral action. I would like to consider two of these in particular, of special relevance to the commitment to development in an increasingly globalized society: justice and the common good." Caritas in Veritate, at Par. 6. But it is more than that. Benedict would tie the values notions he illuminates to the global governance framework as well. "Love in truth — caritas in veritate — is a great challenge for the Church in a world that is becoming progressively and pervasively globalized. The risk for our time is that the de facto interdependence of people and nations is not matched by ethical interaction of consciences and minds that would give rise to truly human development." Id., at Par. 9. This he offers as an alternative either to secular nationalism or the liberal globalization. Id.

This short essay will examine more closely one small section of Caritas in Veritate, the whole of which is worth careful study. Chapter 3 of Caritas in Veritate considers the consequences of charity in truth in the social and economic context--Fraternity, Economic Development and Civil Society)--at the heart of law and governance. Caritas in Veritate at Paragraphs 34-42.

Benedict starts at the heart of the matter--a conflation of Christian notions of original sin with the individual wealth maximizing notions at the heart of liberal economics.

Sometimes modern man is wrongly convinced that he is the sole author of himself, his life and society. This is a presumption that follows from being selfishly closed in upon himself, and it is a consequence — to express it in faith terms — of original sin. The Church's wisdom has always pointed to the presence of original sin in social conditions and in the structure of society. . . . In the list of areas where the pernicious effects of sin are evident, the economy has been included for some time now. We have a clear proof of this at the present time. The conviction that man is self-sufficient and can successfully eliminate the evil present in history by his own action alone has led him to confuse happiness and salvation with immanent forms of material prosperity and social action. Caritas in Veritate, at Par. 34.

From this, he raises a theme developed in the encyclical Spe Salvi, that a values-less economics is effectively soulless and thus subject to great abuse. "Then, the conviction that the economy must be autonomous, that it must be shielded from “influences” of a moral character, has led man to abuse the economic process in a thoroughly destructive way. In the long term, these convictions have led to economic, social and political systems that trample upon personal and social freedom, and are therefore unable to deliver the justice that they promise." Id. Rather, Benedict posits, it is the community, rather than the individual that sits at the center of economic organization, the welfare of which is best met by specific principles of justice; in his case those derived from the theology that animates the faith community he leads.

Because it is a gift received by everyone, charity in truth is a force that builds community, it brings all people together without imposing barriers or limits. The human community that we build by ourselves can never, purely by its own strength, be a fully fraternal community, nor can it overcome every division and become a truly universal community. The unity of the human race, a fraternal communion transcending every barrier, is called into being by the word of God-who-is-Love. In addressing this key question, we must make it clear, on the one hand, that the logic of gift does not exclude justice, nor does it merely sit alongside it as a second element added from without; on the other hand, economic, social and political development, if it is to be authentically human, needs to make room for the principle of gratuitousness as an expression of fraternity. (Id., footnotes omitted but referencing in part, John Paul II, Encyclical Letter Centesimus Annus).

With this, Benedict banishes the foundations of liberal economics for its core value--that values play no role in its rational approach.

"It must be remembered that the market does not exist in the pure state. It is shaped by the cultural configurations which define it and give it direction. Economy and finance, as instruments, can be used badly when those at the helm are motivated by purely selfish ends. Instruments that are good in themselves can thereby be transformed into harmful ones. But it is man's darkened reason that produces these consequences, not the instrument per se. Therefore it is not the instrument that must be called to account, but individuals, their moral conscience and their personal and social responsibility." (Id., at Par. 36).

Liberal economics does not fail for its rationality, but merely because it seeks autonomy within the structure of its own values systems, which, for Benedict, lack a normative basis in (religious) values. As a consequence, social and political cohesion is lost and the public good is sacrificed. "In fact, if the market is governed solely by the principle of the equivalence in value of exchanged goods, it cannot produce the social cohesion that it requires in order to function well. Without internal forms of solidarity and mutual trust, the market cannot completely fulfil its proper economic function. And today it is this trust which has ceased to exist, and the loss of trust is a grave loss." (Id., at Par. 35).

And thus we get to the heart of the matter of foundations--economics is a partial system. It is rationality without values. But it is incapable of producing values in itself. For that purpose, resort must be made to a higher power. While some seek it in the universalist principles of Marxist Leninism, or in the contextualized sui generis values of a state centered political communities, or in the universalism of a civil society shaped set of global community consensus values (at the heart, perhaps of the values basis of liberal globalization), Benedict offers a theologically grounded universalism.

The poor are not to be considered a “burden”, but a resource, even from the purely economic point of view. It is nevertheless erroneous to hold that the market economy has an inbuilt need for a quota of poverty and underdevelopment in order to function at its best. It is in the interests of the market to promote emancipation, but in order to do so effectively, it cannot rely only on itself, because it is not able to produce by itself something that lies outside its competence. It must draw its moral energies from other subjects that are capable of generating them. Id., at Par. 35.

In lieu of autonomous and the directionless (soulless) rationality of liberal economics, Benedict would posit the overarching disciplinary framework of what he refers to as justice principles--though in this case justice principles derived from the theological universe through which he views the world. "The market is subject to the principles of so-called commutative justice, which regulates the relations of giving and receiving between parties to a transaction. But the social doctrine of the Church has unceasingly highlighted the importance of distributive justice and social justice for the market economy, not only because it belongs within a broader social and political context, but also because of the wider network of relations within which it operates." (Caritas in Veritate, Par. 35).

And here is the heart of the rupture between liberal economics and values based systems--the autonomy of economic systems from moral, social and political ones. Instead, economics and its organization becomes something that must be directed from outside of itself--it is impossible to consider it a thing autonomous and self disciplined without regard to outside forces. "The Church has always held that economic action is not to be regarded as something opposed to society. In and of itself, the market is not, and must not become, the place where the strong subdue the weak. Society does not have to protect itself from the market, as if the development of the latter were ipso facto to entail the death of authentically human relations." (Id., at Par. 36). The governance consequences are forcefully described--this is not merely a matter of theology (and thus the muscularity of the concept of caritas is emphasized) but a matter of politics and law.

Economic activity cannot solve all social problems through the simple application of commercial logic. This needs to be directed towards the pursuit of the common good, for which the political community in particular must also take responsibility. Therefore, it must be borne in mind that grave imbalances are produced when economic action, conceived merely as an engine for wealth creation, is detached from political action, conceived as a means for pursuing justice through redistribution. (Id.).

And that common good is, for Benedict, morally pregnant. "Locating resources, financing, production, consumption and all the other phases in the economic cycle inevitably have moral implications. Thus every economic decision has a moral consequence." (Id., at Par. 37). Even secular rationality, Benedict insists, now understands the ethical limits of economic governance standing alone. "Perhaps at one time it was conceivable that first the creation of wealth could be entrusted to the economy, and then the task of distributing it could be assigned to politics. Today that would be more difficult, given that economic activity is no longer circumscribed within territorial limits, while the authority of governments continues to be principally local." Id. Globalization, it seems, has exposed the moral failings of liberal economics, the way that the failings of its finance notions might have exposed the failings even of its rational foundations. See Stiglitz, supra.

Having posited a fundamental limitation of economics--that it is neither autonomous nor self referential (Cf., State, Law and Economy as Autopoietic Systems (Gunther Teubner, and Alberto Febbraio, eds., Milan: Dottore A. Giuffre Editore, 1992) Benedict frames the challenge for economics, and for theological interventions in governance policy:

The great challenge before us, accentuated by the problems of development in this global era and made even more urgent by the economic and financial crisis, is to demonstrate, in thinking and behaviour, not only that traditional principles of social ethics like transparency, honesty and responsibility cannot be ignored or attenuated, but also that in commercial relationships the principle of gratuitousness and the logic of gift as an expression of fraternity can and must find their place within normal economic activity. This is a human demand at the present time, but it is also demanded by economic logic. It is a demand both of charity and of truth. (Caritas in Veritate, Par. 36).

And to this challenge he naturalizes his developing notion of caritas. "Economic life undoubtedly requires contracts, in order to regulate relations of exchange between goods of equivalent value. But it also needs just laws and forms of redistribution governed by politics, and what is more, it needs works redolent of the spirit of gift. The economy in the global era seems to privilege the former logic, that of contractual exchange, but directly or indirectly it also demonstrates its need for the other two: political logic, and the logic of the unconditional gift." Id. Caritas is meant to civilize economic life with values that serve the political and social order and substitute for the autonomy of economic life a connection to the social and political sphere.

Alongside profit-oriented private enterprise and the various types of public enterprise, there must be room for commercial entities based on mutualist principles and pursuing social ends to take root and express themselves. It is from their reciprocal encounter in the marketplace that one may expect hybrid forms of commercial behaviour to emerge, and hence an attentiveness to ways of civilizing the economy. Charity in truth, in this case, requires that shape and structure be given to those types of economic initiative which, without rejecting profit, aim at a higher goal than the mere logic of the exchange of equivalents, of profit as an end in itself. Id., at Par. 38.

But this is not merely a proposal for religiously based economic enterprises. It serves a more universal vision of mutuality and connection between the market the state and civil society--all bent to the same moral purpose. "My predecessor John Paul II drew attention to this question in Centesimus Annus, when he spoke of the need for a system with three subjects: the market, the State and civil society. He saw civil society as the most natural setting for an economy of gratuitousness and fraternity, but did not mean to deny it a place in the other two settings." Id., at Par. 38 (footnote omitted).

But, for Benedict, economic liberalization, with its protection of distinctions between public and private law and between the political and the economic, threaten the foundations of a moral economic order. "Not only is this vision threatened today by the way in which markets and societies are opening up, but it is evidently insufficient to satisfy the demands of a fully humane economy. What the Church's social doctrine has always sustained, on the basis of its vision of man and society, is corroborated today by the dynamics of globalization." Id., at 39. Yet Benedict over reaches here in the service of a singular and universal theologically inspired notion of charity in truth. The oppositional binary Benedict posits is belied by the tremendous secular movements to the conflation of public and private systems. See, e.g., Larry Catá Backer, The Private Law of Public Law: Public Authorities as Shareholders, Golden Shares, Sovereign Wealth Funds, and the Public Law Element in Private Choice of Law, Tulane Law Review, Vol. 82, No. 1, 2008; Larry Catá Backer, Sovereign Investing in Times of Crisis: Global Regulation of Sovereign Wealth Funds, State Owned Enterprises and the Chinese Experience, Transnational Law & Contemporary Problems, Vol. 19, No. 1, 2009. As well it ignores the secular movements to values in political organization.

Benedict suggests that the "exclusively binary model of market-plus-State is corrosive of society, while economic forms based on solidarity, which find their natural home in civil society without being restricted to it, build up society." (Id., Par. 39). Yet, Benedict is not positing so much an oppositional system as he is seeking to witness a competing system, with similar characteristics (the grounding in community, mutuality, and values). But what is clear is that, like movements in liberal economics itself, governance is moving quickly away from notions of autonomy to those of "values" and "community". Benedict argues: "When both the logic of the market and the logic of the State come to an agreement that each will continue to exercise a monopoly over its respective area of influence, in the long term much is lost." (Id.). John Ruggie might agree as he works toward a secular framework of values based governance that also seeks to soften the separation between the public/private, and the economic/political realms. See John Ruggie, Towards Operationalizing the Protect, Respect and Remedy Framework: A Progress Report, A/HRC/11/13, 22 April 2009. Which values will prevail to serve as the basis for governance systems remains to be seen.

And it is to an outline of that competing system that Benedict then turns. Benedict draws the basis of that system from the work of his predecessors.

Paul VI in Populorum Progressio called for the creation of a model of market economy capable of including within its range all peoples and not just the better off. He called for efforts to build a more human world for all, a world in which “all will be able to give and receive, without one group making progress at the expense of the other”[94]. In this way he was applying on a global scale the insights and aspirations contained in Rerum Novarum, written when, as a result of the Industrial Revolution, the idea was first proposed — somewhat ahead of its time — that the civil order, for its self-regulation, also needed intervention from the State for purposes of redistribution. (Id., Par. 39).

Benedict, like many other civil society actors, decry the traditional shareholder model of corporate governance.

Without doubt, one of the greatest risks for businesses is that they are almost exclusively answerable to their investors, thereby limiting their social value. Owing to their growth in scale and the need for more and more capital, it is becoming increasingly rare for business enterprises to be in the hands of a stable director who feels responsible in the long term, not just the short term, for the life and the results of his company, and it is becoming increasingly rare for businesses to depend on a single territory. (Id., Para. 40).

This echoes sentiments long held by those fearful of an autonomous economic power, a system of institutions not beholden to a superior force--the state, religious institutions or the like. It is as much a statement of fear of the rise of competition from an outside source, of power, as it is an application of values concepts. One could argue that Caritas and Veritas are as capable of application internally by autonomous economic institutions, as they are applicable of imposition after such enterprises are domesticated within power hierarchies in which they play a subordinate role.

Likewise, Benedict points to the disaggregation of production as an evil to which the values of caritas might apply. "Moreover, the so-called outsourcing of production can weaken the company's sense of responsibility towards the stakeholders — namely the workers, the suppliers, the consumers, the natural environment and broader society — in favour of the shareholders, who are not tied to a specific geographical area and who therefore enjoy extraordinary mobility." Id. at Par. 40. Here again Benedict moves from a theological point with multiple vectors of implementation to an alignment with certain elements of civil society who see the issue as one of power. The Organization for Economic Cooperation and Development has itself sought to gain acceptance for a similar view of the obligations of multinational corporations in their relationships with entities with whom they deal. For a discussion, see, Larry Catá Backer, Rights and Accountability in Development (Raid) V Das Air and Global Witness V Afrimex: Small Steps Toward an Autonomous Transnational Legal System for the Regulation of Multinational Corporations, Melbourne Journal of International Law, Vol. 10(1) (2009).

Benedict posits a stakeholder model grounded in the values of Caritas in Veritate and subject to an external regulation by those who share a stake in the enterprise.

Today's international capital market offers great freedom of action. Yet there is also increasing awareness of the need for greater social responsibility on the part of business. Even if the ethical considerations that currently inform debate on the social responsibility of the corporate world are not all acceptable from the perspective of the Church's social doctrine, there is nevertheless a growing conviction that business management cannot concern itself only with the interests of the proprietors, but must also assume responsibility for all the other stakeholders who contribute to the life of the business: the workers, the clients, the suppliers of various elements of production, the community of reference. (Caritas in Veritate, Par. 40).

And echoing state actors in private financial markets, particularly the Norwegian sovereign wealth fund managers, Benedict suggests that to "be avoided is a speculative use of financial resources that yields to the temptation of seeking only short-term profit, without regard for the long-term sustainability of the enterprise, its benefit to the real economy and attention to the advancement, in suitable and appropriate ways, of further economic initiatives in countries in need of development." (Id.). For a discussion from the secular state based perspective of these ideas, see Larry Catá Backer, Sovereign Wealth Funds as Regulatory Chameleons: The Norwegian Sovereign Wealth Funds and Public Global Governance Through Private Global Investment, Georgetown Journal of International Law, Vol. 40, No. 4, 2009.

But it is not merely business enterprises whose actions must be guided by superior and binding values systems. (Id., at 41). Political entities are also bound by their own set of values. "Political authority also involves a wide range of values, which must not be overlooked in the process of constructing a new order of economic productivity, socially responsible and human in scale. As well as cultivating differentiated forms of business activity on the global plane, we must also promote a dispersed political authority, effective on different levels." (Id.). This suggests a necessary loss of sovereignty for the global common good on the political plane. Id. And thus a reformed understanding of the role of law in global governance:

In terms of the resolution of the current crisis, the State's role seems destined to grow, as it regains many of its competences. In some nations, moreover, the construction or reconstruction of the State remains a key factor in their development. The focus of international aid, within a solidarity-based plan to resolve today's economic problems, should rather be on consolidating constitutional, juridical and administrative systems in countries that do not yet fully enjoy these goods. Alongside economic aid, there needs to be aid directed towards reinforcing the guarantees proper to the State of law: a system of public order and effective imprisonment that respects human rights, truly democratic institutions. The State does not need to have identical characteristics everywhere: the support aimed at strengthening weak constitutional systems can easily be accompanied by the development of other political players, of a cultural, social, territorial or religious nature, alongside the State. The articulation of political authority at the local, national and international levels is one of the best ways of giving direction to the process of economic globalization. It is also the way to ensure that it does not actually undermine the foundations of democracy. (Id., at 41).

The ramifications of this view are profound. State and law must bend to the imperatives of globalization--but a values-based globalization, in which values, and those responsible for their generation, interpretation and protection, assume a privileged place in the hierarchy of authority.

The breaking-down of borders is not simply a material fact: it is also a cultural event both in its causes and its effects. If globalization is viewed from a deterministic standpoint, the criteria with which to evaluate and direct it are lost. As a human reality, it is the product of diverse cultural tendencies, which need to be subjected to a process of discernment. The truth of globalization as a process and its fundamental ethical criterion are given by the unity of the human family and its development towards what is good. Hence a sustained commitment is needed so as to promote a person-based and community-oriented cultural process of world-wide integration that is open to transcendence. (Id., at Par. 42).

Consequently, the "transition inherent in the process of globalization presents great difficulties and dangers that can only be overcome if we are able to appropriate the underlying anthropological and ethical spirit that drives globalization towards the humanizing goal of solidarity. Unfortunately this spirit is often overwhelmed or suppressed by ethical and cultural considerations of an individualistic and utilitarian nature." (Id.). Benedict means to reorient globalization, and ground it on a different framework. "Globalization is a multifaceted and complex phenomenon which must be grasped in the diversity and unity of all its different dimensions, including the theological dimension. In this way it will be possible to experience and to steer the globalization of humanity in relational terms, in terms of communion and the sharing of goods." (Id.).

At the heart of the project of Deus Caritas Est and Caritas in Veritate lie a powerful and powerfully felt need to domesticate institutions over which individuals appear to have lost control. The traditional means of domestication—through the construction of hierarchies of power relationships—is still important. But more important still is the deployment of ideas, of a set of principles to which these actors must be bound. Control of ideas, then, more than control of actors, becomes the principal means through which governance can be effected. The methodology of that governance becomes a second order consideration—Benedict is not interested in direct enforcement. He is, however, quite concerned with the theology underlying that enforcement, and with control of the mechanics of its production and interpretation. But then, so are all of those who are seeking a dominant voice in the development of the normative framework through which corporations and other economic actors will be subject.

Michel Foucault reminded us nearly a generation ago that direct power relationships were, to a great extent, now necessarily better understood as anachronisms. Michel Foucault, Discipline and Punish: The Birth of the Prison (Alan Sheridan, trans., 19977, NY: Vintage Books 1995)). Caritas in Veritate reminds us that just as there is a convergence of public and private law, so there appears to be a similar convergence between law as a formal and institutionalized set of tools over which public entities exercised a monopoly power (on the one hand), and governance as private, contractual, and informal methods of controlling or regulating behavior available to any community with sufficient power to assert it. The power of ideas now disciplines law the way that positive law once disciplined behavior. Ideas become the source of behavior, and governance its vehicle, as law, like the state, becomes more embedded within the globalized institutional environment of soft and hard multi-level and polycontextual regulation. See Larry Catá Backer, Democracy Part XI: Mass Democracy and Shareholder Democracy Converge, Law at the End of the Day, June 30, 2008.

Liberal globalization offers one version of a post-legal system of governance, one grounded in rationality, consensus and participation among stakeholders. And the implications of the science/medicine centering of reality for social organization for social control--through law and habit--have also been well developed, through notions of the "disciplines" those self reinforcing and self executing habits that serve as minutely and compelling structures of behavior far more intimately connected to the individual than the traditional control through the imposition of law. See Michel Foucault, Discipline and Punish, supra. The great glory of a therapeutically based disciplinary society is that law can be reduced to a gesture--the real work of social control is focused below the level of instrumental statements from institutional actors to a complex set of ideas about normal conduct which are to be absorbed by individuals who then police themselves. Benedict offers another version. This one, too, is grounded in the disciplines and governance. But in place of consensus and participation as the source of behavior norms, Benedict offers the Church and its theology—truth derived from a divine source and entrusted to the ministers of that source on Earth. Either way, it is through the disciplines, rather than through the structures of positive law, that even the greatest economic enterprise will find itself, not merely controlled, but serving as the principal agent for its own control. That, perhaps, is the greatest truth in the normative framework of charity. See Larry Catá Backer, Global Panopticism: States, Corporations and the Governance Effects of Monitoring Regimes, Indiana Journal of Global Legal Studies, Vol. 15, 2007.

For those who would seek to operationalize new systems of governance for large economic enterprises, enterprises that have essentially escaped the power of a single state, it would be well to heed the blunt focus of Benedict’s program in Caritas in Veritate, one that is worth repeating: “Hence a sustained commitment is needed so as to promote a person-based and community-oriented cultural process of world-wide integration that is open to transcendence.” (Caritas in Veritate, at Par. 42). Whether secular or theological, whether state driven or supra national, what emerges as a key to operationalization of any normative framework are the key elements identified by Benedict: normative transcendence, communal orientation, individual person based, diffused mechanics of enforcement, tightly controlled and centralized institutionalization and control of the normative framework itself. The object is, like Foucault’s notion of disciplines, aimed at self-enforcement. This is the great transformative project of the 21st century.