A Libertarian Mungerfesto, Part II: Voluntary Exchange, Euvoluntary Exchange, and the Case for Cooperation.

(A prefatory note:  Most of the references are omitted.  This is a summary, not an academic paper.  Some of the argument here is adapted from Guzman and Munger, 2013)

 

David Hume gives an example of what we might call “coercion by circumstance” (Hume 2000, Book III, Pt. II,  Sec. V):

“A man, dangerously wounded, who promises a competent sum to a surgeon to cure him, wou’d certainly be bound to performance; tho’ the case be not so much different from that of one, who promises a sum to a robber.”

Now, Hume was interested in the question of whether the wounded man would be bound by a promise to pay.  I think the more interesting question is whether the surgeon is morally permitted to elicit such a promise in the first place.  Or, what amounts to the same thing, is the wounded man able to enter into a contract for services?  To answer “no” is to condemn the wounded man to death.  But to answer “yes” means that the surgeon is permitted to act immorally.  Choose carefully. (MORE AFTER THE JUMP…) If people can judge their own abilities, resources, goals, and life plans, and if they have the ability to make choices among genuinely feasible, usable alternatives, the case for allowing such private choices is very strong.  Any argument for state restriction of truly voluntary actions would face “strict scrutiny,” a  presumption in favor of voluntary, mutually beneficial actions. The compass of voluntary action can be limited only for good cause, on clear grounds, and (one might argue) with the consent of the person whose compass for voluntary action is being restricted. The liberty of individuals to engage in voluntary actions rests on two intimately connected rights:

  1. Freedom of contract: the right to enter voluntarily into binding agreements, violation of which leads credibly to punishment for the violator or compensation for the victim.
  2. Property rights: the rights to control the use, benefit from, transfer or sell, and exclude others.

When presented in these abstract terms, many people agree that the essence of liberty is the ability to enter, and leave, voluntary agreements.  What if there were no state to restrict the form of contracts? How would people act?  How would norms look, in the absence of formal enforcement, and what limits might be placed on agreements by moral intuitions? James Buchanan (1975: 3, emphasis added) famously answered the question this way:

To the individualist, the ideal or Utopian world is necessarily anarchistic in some basic philosophical sense. This world is peopled exclusively by persons who respect the minimal set of behavioral norms dictated by mutual tolerance and respect. Individuals remain free to “do their own things” within such limits, and cooperative ventures are exclusively voluntary. Persons retain the freedom to opt out of any sharing arrangements which they might join. No man holds coercive power over any other man, and there is no impersonal bureaucracy, military or civil, that imposes external constraint.

If norms could guide human exchange behavior, either in the setting with legal restriction or in an anarchic setting, we quickly confront moral dilemmas. And if laws come to instantiate and reify the norms we use to resolve moral dilemmas, understanding these norms is an important part of the research agenda. In the discussion above, I have used the word “contract.” But I have been careful not to use the word “exchange” or “markets.”  Because our side always gets hung up on the wire, searchlights blinding our eyes, and all that small arms fire enfilading our line, before we even get a chance to start to make our actual core argument.  It is just not true, not in the popular mind and not in terms of vernacular definitions and usage, that “markets are what happens when the state doesn’t interfere.”  What happens in the absence of state interference is society, voluntary private organizations, and contracts for capturing gains from cooperation.  Not exchange.  Cooperation. A caveat:  I’m perfectly happy to call the voluntary contracts people write and enforce an “exchange theory of politics,” after Buchanan and Tullock’s notion in The Calculus of Consent.  Because I know what Buchanan meant by “exchange.”  As James Buchanan put it:

…basic “political exchange,” the conceptual contract under which the constitutional order is itself established, must precede any meaningful economic interaction.  Orderly trade in private goods and services can take place only within a defined legal structure that establishes individuals’ rights of ownership and control of resources, that enforces private contracts, and that places limits on the exercise of governmental powers…Even within a well-defined and functioning legal order, “political exchange” necessarily involves all members of the relevant community rather than the two trading partners that characterize economic exchange. (p. 50; emphasis original.)

Buchanan had a “state of nature” theory about politics.  His metaphor for the state of nature is Robinson Crusoe, on Thursday (that is, the day before Friday).  Crusoe faces some of the standard economic problems, in terms of optimizing his use of resources and looking for efficient solutions.  But there is no exchange, no social interaction, in the system. And then Friday shows up.  The first thing that happens is not exchange.  There first has to be an agreement, perhaps an implicit agreement, that the two men not kill each other, at least not today, not now.  That’s the “political exchange,” and for Buchanan it is logically prior to markets or economic exchange.  The conceptual contract, or small-c “constitution” under which the men don’t kill each other comes first. Is the contract binding? Did they formally “consent” to it? No, and no.  And yet there is a constitution.  You start from where you are.  Changes require consent.  If there are going to be new rules, we have to agree to them.  From that starting point, people may be able to develop an infrastructure within which exchange is possible.  Most importantly, the exchange is not private goods, or money.  The exchange is cooperation, with the result being the capture of the mutual benefits from solving collective action problems. That’s an important distinction, and we often lose sight of it.  To solve collective action problems we need politics, agreement, and cooperation.  Do we need a state?  Maybe, maybe not.  That’s a legitimate question. But all too often in debates our side gives up too much when, eager to unjustify the state, we also prohibit voluntary collective actions.  Public goods cannot be provided by bilateral, impersonal, one-off market exchanges.  But that does not imply that state provision is therefore necessary.  There are a variety of private, voluntary, collective contracting forms that would occupy this terrain. What does voluntary mean? Is it sufficient that consent not be extorted at gunpoint? Many believe that an absence of coercion by direct human agency does not suffice.  People also must not be coerced by the absence of alternatives.  A choice can’t be voluntary if it is not a choice. Michael Sandel (1998:  78) formulates the objection in this way

The… objection [to the claim that an exchange is truly voluntary] is an argument from coercion. It points to the injustice that can arise when people buy and sell things under conditions of severe inequality or dire economic necessity. According to this objection, market exchanges are not necessarily as voluntary as market enthusiasts suggest. A peasant may agree to sell his kidney or cornea in order to feed his starving family, but his agreement is not truly voluntary. He is coerced, in effect, by the necessities of his situation.

To eliminate the ambiguity in the meaning of voluntariness, I proposed the formal notion of euvoluntariness, or “true voluntariness.” For a market exchange to be euvoluntary six conditions must be met:

  1. The parties own the objects or services being exchanged, according to the conventional interpretation of ownership.
  2. The parties have both the legal and practical capacity to transfer these objects or services.
  3. There is no fraud, and no psychological compulsions such as addiction or neuropathy.
  4. The exchange does not produce large-scale uncompensated non-pecuniary externalities, and does not impose costs on third parties without their express voluntary consent.
  5. Neither party is coerced in the sense of being forced to exchange by threat of violence or other form of active aggression.
  6. Neither party is coerced into exchange by dire necessity, and neither party has enough bargaining power to impose an unconscionable price.

Conditions 1–6 are standard requirements for a valid contract in the common law. Conditions 5 and 6 could be summarized as “no duress.” A market exchange is voluntary if conditions 1–5 are satisfied, but it is not be euvoluntary unless condition 6 is satisfied as well.  Condition 6 requires that no one is “coerced by circumstance.” Final There has been a bunch of argle-bargle here.  It is useful to summarize.  The basic claim I want to make goes as follows:   Groups of humans require society, and in fact it’s hard to stop humans from constructing voluntary societies to achieve shared goals.  (The state can stop society, or stunt it, but people will always try.)  In a society, collective or group decisions must be made, because the scope of some activities—externalities and public goods, even just local public goods like trash pickup or police protection—goes beyond the individual.  Either my actions affect others, or the cooperation of many is required to provide any of the good, at all.  We have to solve collective action problems. The way groups of people solve collective action problems is called politics.  It is not market exchange. The key insight of Public Choice, especially from James Buchanan, is that “politics as voluntary exchange” allows us to understand society and how contracts might work to solve collective action problems.  But those solutions are not market solutions. Then I tried to describe what “voluntary” means, what it means for something to be truly voluntary.  Because the argument for politics as voluntary exchange relies on people being able to enter binding contracts, contracts that allow, even require, the use of force or coercion if the terms of the contract are violated. That is what freedom requires:  I have to be able to enter into voluntary contracts that imply I will be coerced, because I gave my consent to be coerced, voluntarily. For that reason, the nature of what is voluntary is central to the problem.  Can we really say that people give consent?  Under what circumstances is consent binding?  And how have economists “solved” this problem by simply begging it, the way economists  usually do?  I will try to talk about these questions in part III.

  • Theresa Klein

    To the original problem:
    “A man, dangerously wounded, who promises a competent sum to a surgeon to cure him, wou’d certainly be bound to performance; tho’ the case be not so much different from that of one, who promises a sum to a robber.”

    How does this formulation account for the finite nature of resources?
    Let us suppose that the surgeon’s time is not infinite (which it surely isn’t), and neither are the resources used in surgery (for instance, blood). A dangerously wounded man consumes more of those resources than 5 other people that the surgeon could otherwise heal.
    How does it alter our judgement of the validity of the contract that the dangerously wounded man enters into, if by consuming those resources, he necessarily denies them to others?

    • Michael Byrnes

      It doesn’t seem that Hume (or Munger) was trying to say that such a contract was not valid.

      But we can imagine both valid and perhaps not valid contracts in that situation.

      There is a price that reflects the value of the surgeon’s time, any personal risks the surgeon is taking (maybe the guy is wounded on an active battlefield), etc.

      But there’s another way to look at it. If you are the surgeon and I am the wounded guy, you could say, “I’ll save your life… in exchange for literally everything you own. Alive and penniless is better than dead! ” There’s not really time for me to negotiate before I bleed out, so it is pretty much a take it or leave it offer. There’s obviously a strong case that both parties will be made better off if I agree to the deal. Does that make it a valid contract? I don’t think so.

      • Theresa Klein

        That’s the original way of looking at it.
        What I’m doing is giving you a thought experiment. Suppose you’re not the only wounded person on the battlefield. How are the resources of the surgeon best distributed?
        Should I make a utilitarian judgement that five are better than one and you should be left to die? What if your paying me everything you own would allow me to hire 50 other surgeons to help me save 250 additional lives? Or what if it just encourages other field surgeons to get into the business, so I end up with some competition?

        • Michael Byrnes

          All very interesting questions…

      • One possible criterion to establish euvoluntarity (and therefore an argument to treat a contract as valid) is that it never has buyer/seller remorse and is hysteresis free/ergodic for that reason.

        In offering me the contract- ‘I save your life in return for all your wealth’- the surgeon is taking a gamble that I will renege without incurring a ‘reputation cost’ citing my own exigent circumstances and the surgeon’s apparent, irrational, greed in my defense.

        Shylock could have made a good profit on his loan to Antonio. By overstepping the mark, he lost everything.

        Actually, a reason why the surgeon may offer this contract to a rich businessman is because the businessman gains so much ‘reputation benefit’ by voluntarily carrying out its terms that he can immediately do business on a much larger scale using money borrowed on favorable rates.

        If I let myself be price-gouged and make it known that I do so from Libertarian convictions, people may be more inclined to help me voluntarily under exigent circumstances because they know I will mentally feel I ‘owe’ them not the market price but the value to me, at my time of distress, of receiving that benefit.

        Ultimately, a lot of contracts just aint justiciable but still involve either reputation costs or else something similar we might call ‘integrity’ costs which act in the same way.

        I may mention there’s a sort of Thymotic Libertarianism derivable purely from ‘integrity costs’ which can deal with the problem of duress/coercion. Vide http://socioproctology.blogspot.co.uk/2013/10/mugging-clark-kent.html

    • SimpleMachine88

      I’d put it more like this. The very high value to the wounded man is what is being used as a reason for limiting the price. But, if removing the ability to bilk wounded men results in fewer people choosing to become surgeons, then that same reason makes the cost of limiting the price incredibly high- it will kill people.

      But we don’t think through this, and choose to ignore these costs. A wounded man just dies, and we go “shame there wasn’t a surgeon around”. I’m really seeing this as an argument that depends on willful ignorance.

      I don’t think it’s at all unreasonable that if someone managed to take someone for all they’re worth from being a surgeon at the right place and time, other people might not go “hey, it’s pretty good to be a surgeon”, there’d be more surgeons wandering around, and as a result there’d be fewer deaths by wounding.

      • Jay_Z

        What happens if you’re both bilked and dead? What happens if the bilker leaves you in a worse position and takes your money?

        You’re at the side of the road, and you need medical care/and or transport to the hospital. It’s not illegal to demand everything you own, and more (you have friends and family, right) for the service.

        When you have no bargaining power, no ability to walk away from the deal, “the deal” is closer to kidnapping or blackmail that it is a market swap. All the money in the world won’t allow you to dictate any terms. You are giving the person money, then essentially begging them to do as you’d like.

        You can have strangers masking themselves as Good Samaritans, spiriting you away from anyone else that can help. Now further travel is a million dollars a mile. You don’t like it, walk away. You can’t walk? Why is that my problem? All perfectly allowable by unlimited contract law.

        • SimpleMachine88

          We are talking about voluntary exchanges (conditions 1-5), and whether dire necessity (condition 6)is necessary. None of those things you listed are voluntary.

          If the surgeon takes your money and doesn’t provide the agreed on service, that’s fraud. If someone tells you they’re going to give you a ride, and then doesn’t, that’s also fraud. Those aren’t voluntary exchanges (see condition 3), and I assure you are not “perfectly allowable by unlimited contract law”. That all was a complete non sequitur.

          Wounded people do not have a dire necessity to not be healed. Nothing at all prevents people from walking away from someone not helping them, and people are able to demand terms in dire necessity, namely for what is direly necessary.

          Now, the question was whether voluntary exchanges should be precluded by dire necessity. The point is that a reduction in price causes a reduction in quantity supplied, the law of supply. Reducing the price of things that are direly necessary reduces the quantity of things that are direly necessary.

          It sure as hell does represent a market transaction in that way, and you can’t choose to pretend otherwise. Perhaps taking advantage of someone’s dire necessity is akin to blackmail, but preventing someone from doing so is then akin to murder. Think it through.

  • “It is just not true, not in the popular mind and not in terms of vernacular definitions and usage, that ‘markets are what happens when the state doesn’t interfere’. What happens in the absence of state interference is society, voluntary private organizations, and contracts for capturing gains from cooperation.”

    Thank you. One pet peeve I have about some (not all) libertarians is the attempt to fit all non-state activity into the framework of economic exchange.

    “The way groups of people solve collective action problems is called politics. It is not market exchange. The key insight of Public Choice … is that ‘politics as voluntary exchange’ allows us to understand society and how contracts might work to solve collective action problems.”

    And my other pet peeve about some (not all) libertarians is their apparent belief that the problems with politics identified by Buchanan and others completely rule out the possibility of solving problems via government or other non-market mechanisms.

    I prefer the Elinor Ostrom approach: Figure out what works in real societies under what conditions, and why–what do the initial conditions have to be, what forms do successful mechanisms take, how do systems defend against defection, what scaling factors operate, and so on. The moral impulses behind and logical arguments for libertarianism provide the impetus to do the empirical work, but do not substitute for it.

    • Theresa Klein

      But the moral impulses also serve as a guide to decide what solutions are just and unjust. For instance, feudalism “worked” for a long time. But it wasn’t necessarily just. Politics and force tend to result in different solutions than politics and voluntary cooperation.

    • Theresa Klein

      But the moral impulses also serve as a guide to decide what solutions are just and unjust. For instance, feudalism “worked” for a long time. But it wasn’t necessarily just. Politics and force tend to result in different solutions than politics and voluntary cooperation.

      • I agree; that’s partly what I meant. I like to use slavery as an example: There is the judgment/intuition that slavery is a moral wrong, the resulting conclusion that a society without slavery would be more just, and the empirical working out of how exactly a society and its economy could evolve to not require slavery and still provide a high standard of living.

        • At the risk of running long, here’s another example, this time of voluntary collective action in support of moral impulses: Circa 1970 Richard Stallman felt it was morally wrong to distribute software without providing the recipients broad rights to modify that software and redistribute in modified form. He wrote manifestos, but it took lots of work and a confluence of external events to make it happen: Stallman’s own software development (editor, compiler), cheap PCs, Linux OS kernel, the Internet + coordination software (revision control, bug tracking) to lower Coasian transaction costs, developers and others with leisure time to volunteer, acquiring practical political knowledge on how to run and scale development projects, business-friendly rebranding away from moral concerns (free software -> open source) and changes in the software industry (Oracle out, Google in) that provided incentives to share software and cooperate on developing it. The end result is not quite the world Stallman wanted, but much closer.

          If libertarian ideals are realized more broadly I think it will happen like that, and I think it will not happen without major socioeconomic changes driven by factors other than libertarians and their arguments.

          • Les Kyle Nearhood

            In short an argument for both incrementalism and some sort of consequentialism. I am happy with such an approach mostly for the reason the libertarians are not likely to gain much political power anytime soon.

          • Theresa Klein

            You can see technology driving change with services like AirBnb and Uber, but that hasn’t stopped vested interests from attempting to outlaw those technologies.

          • Theresa Klein

            You can see technology driving change with services like AirBnb and Uber, but that hasn’t stopped vested interests from attempting to outlaw those technologies.

    • SimpleMachine88

      Sure, free exchange and free elections are both systems of resolving differences. But when you compare them mathematically, it’s obvious that the former works much better under almost all conditions.

      Charity is another, but that’s not the state any more than the market. It a case against the necessity of resorting to the latter.

      I think you’re pet peeve is caused by libertarians almost constantly having to respond to “there’s a market failure, ergo the government should act”, when you have to compare two different imperfect systems, and ask is this an area where public choice performs better than free exchange. Arrow’s Impossibility Theorem doesn’t completely rule out government solving problems, but it does rule out arguments that don’t consider the problems of public choice.

    • SimpleMachine88

      Sure, free exchange and free elections are both systems of resolving differences. But when you compare them mathematically, it’s obvious that the former works much better under almost all conditions.

      Charity is another, but that’s not the state any more than the market. It a case against the necessity of resorting to the latter.

      I think you’re pet peeve is caused by libertarians almost constantly having to respond to “there’s a market failure, ergo the government should act”, when you have to compare two different imperfect systems, and ask is this an area where public choice performs better than free exchange. Arrow’s Impossibility Theorem doesn’t completely rule out government solving problems, but it does rule out arguments that don’t consider the problems of public choice.

    • techniknoergler

      “It is just not true, not in the popular mind and not in terms of
      vernacular definitions and usage, that ‘markets are what happens when
      the state doesn’t interfere’. What happens in the absence of state
      interference is society, voluntary private organizations, and contracts
      for capturing gains from cooperation.”

      But this is a market, isn’t it?

  • Sean II

    In Hume’s day, I would have paid the surgeon anything he wanted…to keep his hands off me.

  • So, an economic contract presupposes a political contract which sets the legitimate context for the economic contract. But if that is so, surely we need a meta-political contract to set the legitimate context for the political contract. And then you are caught in a vicious infinite regress. There is a solution to this problem; but it involves abandoning social-contract theory, as I explain here:

    http://www.rmm-journal.de/downloads/Comment_Frederick.pdf

    Some of your conditions, 1-6, for true voluntariness seem arbitrary.

    “1. The parties own the objects or services being exchanged, according to the conventional interpretation of ownership.”

    So, in ancient Rome, one slaveholder can sell a slave to another because, “according to the conventional interpretation of ownership,” the first owns the slave.

    “2. The parties have both the legal and practical capacity to transfer these objects or services.”

    So the slave cannot engage in any contracts on his own behalf because he lacks the legal capacity to do so (according to Roman Law).

    “4. The exchange does not produce large-scale uncompensated non-pecuniary externalities, and does not impose costs on third parties without their express voluntary consent.”

    So, businesses must be prohibited from innovating because they will thereby subject their competitors to large-scale uncompensated non-pecuniary externalities (such as the distress caused by the end of a family business handed down for generations), and will also impose costs on competitor businesses, without their consent, by means of substantial reduction in income.

    “6. Neither party is coerced into exchange by dire necessity, and neither party has enough bargaining power to impose an unconscionable price.”

    So economic progress is to be prohibited because it will drive inefficient business to bankruptcy thereby forcing them to sell their assets by dire necessity. The notion of an “unconscionable price” seems inherently arbitrary.

    Back to the drawing board, I think.

    • Michael Byrnes

      “So, an economic contract presupposes a political contract which sets the legitimate context for the economic contract. But if that is so, surely we need a meta-political contract to set the legitimate context for the political contract.”
      No. It’s impossible to envision two parties making any sort of economic contract without some basic agreement (not necessarily formal or explicit) on at least some of the rules of the game. That would be the “political contract.”

      • So how do you avoid the regress?

        • Buchanan was making the point that his subject showed how Economics changed Politics and vice versa- bribery, rent-seeking, log-rolling etc- so actually we are talking about co-evolved complexity- not an infinite regress.
          Social Contract theory, despite being silly, is a good Schelling focal point for a particular sort of huckster- Munger or Unger- peddling gesture political snake-oil, but precisely because every term it uses is essentially contested, the real evil bastards- I mean lawyers- are gonna makes sure this dope keeps getting peddled at Ivy league playgrounds so as to get yet another generation of entitled, bien pensant fuckwits hooked.

          • Buchanan’s point about politics is a good one. His point that economic contracts presuppose a moral background is also a good one. But he was mistaken in trying to explain that moral background in terms of a political contract. ALL contracts presuppose a background of moral norms (as Hume pointed out). Those background moral norms cannot, therefore, themselves be the result of a contract, on pain of infinite regress. The idea of ‘morals by agreement’ is silly.

          • Agreed. My feeling is that Buchanan is giving a lecture to young people overawed by the Rawlsian/’Ideal speech situation’/Judge Hercules bandwagon of the Seventies and the sudden resurgence of Kantian cant. Buchanan himself is more like Boulding or Hayek in having a notion of what we would call co-evolved complexity and does himself a dis-service in trying to fit his insights into a Contractarian strait-jacket.
            By contrast, Binmore’s attempt to ‘de-Kant’ the subject is instructive in this context and a possible way forward.

            I think we make a mistake when we think of contracts as ‘ideal’ vehicles. In the real world, it is of the essence of a contract (as opposed to a relationship) that one or both parties is acting mala fide or that something germane is held to be ‘essentially contestable’. In other words, real world contracts are more like lotteries.
            Indeed, most transactions are unilateral contracts of a certain type such that we expect the party offering it to have done the Econometric due diligence, so to speak, and made allowances for the different proportions of different customer types he’s likely to get. What I mean is, I expect Marks & Spencers to treat me as though I’m an honest man, when I return something because I think a big company of that sort should have developed a M.I.S to spot the dishonest minority.
            Dunno if that makes any sense. It’s early yet.

  • The six conditions make no sense.
    1) I can contract to sell something I don’t own- I do it all the time. I can then sell the contract to sell to a willing buyer without ever owning the thing.

    2) just because some transactions are illegal in North Korea don’t mean they aint euvoluntary. The law can be an ass. The fact that I keep beating you may prevent you from having the practical ability to deliver on a euvoluntary transaction. This don’t change the nature of the beast.
    3) ‘psychological compulsion’ is essentially contested. A Vegan may think I’ve been brainwashed to want beef steak or that it is an addiction.
    4) Suppose I make a contract to teach Einstein Maths in exchange for electrical help from his dad. The alternative is he studies Music. Because, Einstein studies Math, there is a huge positive externality. On the other hand, I make a contract to teach Hitler ‘Racial Science’. The result is a huge negative externality. However, the euvoluntary nature of the transaction remains the same. Either that or you are using the word in the sense of ‘What God would do’

    5) is trivial. That’s not a transaction. It’s robbery with menaces.
    6) Means that a large class of people are denied capacity to contract are are as the people or institutions best placed to help them because of their discernible relative market power. This cashes out as Indian type paternalism where the peasant can’t sell his land because he is assumed to be very stupid, starving and lacking market power. Bill Gates wants to buy the land for a free hospital- but he has a lot of market power, so we can’t let him go ahead.

    You say groups of humans need Society. But a group of humans constitute a Society even if they don’t talk to each other. The alternative to transaction based contracts are relationships- including thymotic ones. Mechanism design keeps happening at the margin- where markets are missing.

  • Sean II

    So here’s what I don’t get: The same sort of people who’ll tell you the NAP is invalid because of reductios involving uninvited photons, will turn around and offer a principe like…

    “4. The exchange does not produce large-scale uncompensated non-pecuniary externalities, and does not impose costs on third parties without their express voluntary consent.”

    …which obviously poses serious problems for anyone who happens to believe in anthropogenic global warming, since every exchange using carbon-based energy would thus fail this test in elegant proportion to the calories used. Since that includes nearly every exchange worth making (other than sex in the dark), it seems that nearly the whole of the market is therefore “involuntary”.

    or…

    “6. Neither party is coerced into exchange by dire necessity, and neither party has enough bargaining power to impose an unconscionable price.”

    …no term used in standard formulations of the non-aggression principle does so much magic as “dire necessity” and “unconscionable price” are being asked to do here. Neither term can be defined in any way that promotes agreement between people who don’t already think overwhelmingly alike.

    So the question is…if we have to wait around for people to think alike anyway, why don’t we just wait until they think sufficiently alike to interpret non-aggression to mean “taxes are aggression, flashlights usually not”?

  • DST

    “Conditions 1–6 are standard requirements for a valid contract in the common law. Conditions 5 and 6 could be summarized as “no duress.””

    I’m currently a law student, and from what I’ve seen you’re correct that an agreement that violates condition 5 would virtually be guaranteed to be found invalid. I’m not so sure, however, about a contract that violates condition 6. It’s true that sometimes contracts are ruled not to be enforceable due to unconscionability, and that such rulings may be more commonplace now than they were a century ago, but I think contract law can still be rather conservative, and that such contracts are often upheld.

    Stepping from legal considerations to the philosophical, I don’t see the value, or even the practicality, of condition 6. When is a necessity “dire”? When is a price “unconscionable”? Following Sandel’s example, would the peasant really not view his kidney sale to be voluntary? How is restricting the choices available to him making his situation more voluntary? If he was barred from selling his kidney, would he be more or less likely to obtain his desired outcome? If you tie a fighter’s left hand behind his back before a fight, are his actions during the fight more voluntary than if he were allowed to use both hands?

  • TracyW

    I’m worried now – how is the poor guy with a life-threatening wound going to get healed? Or the poor peasant’s family saved from starvation?
    This euvoluntariness seems rather heartless.

  • TracyW

    I’m worried now – how is the poor guy with a life-threatening wound going to get healed? Or the poor peasant’s family saved from starvation?
    This euvoluntariness seems rather heartless.

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  • yogi

    //Neither party is coerced into exchange by dire necessity, and
    neither party has enough bargaining power to impose an unconscionable
    price.//

    This even fails as a moral principle…

    Let’s take two separate actions:
    i) You need a kidney. I donate you one of mine.

    ii) I need a roof on my head. You donate me the money I need to put one.

    These two actions are morally justified in isolation. So how can they become morally problematic when they happen simultaneously ?

    Besides, I have public choice objections to this line of thinking. The terms “dire necessity” and “unconscionable price” will be re-defined to mean anything that Government of the day wants it to mean (Just like “general welfare” and “interstate commerce”).

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