Vol. 21 No. 3 (March, 2011) pp.90-97
THE CONSTITUTIONAL PROTECTION OF CAPITALISM, by Danny Nicol. Oxford: Hart Publishing, 2010. 220pp. Hardcover. £35.00/$70.00. ISBN: 9781841138596.
Reviewed by Bogdan Iancu, Faculty of Political Science, University of Bucharest. Email: bogdan.iancu [at] fspub.unibuc.ro.
THE CONSTITUTIONAL PROTECTION OF CAPITALISM is an ambitious title, which makes a worthy academic promise by posing a foundational question. The theoretical fathers of modern constitutionalism viewed property as a pre-political right attached to personality. Locke’s argument in the SECOND TREATISE, where ‘estate,’ life, and liberty are analytically on the same par and inextricably interlinked is the classic example. Consequently, protecting property from public interference as a matter of principle meant respecting personal dignity and safeguarding natural individual and –incidentally-- societal autonomy against the state. Even censitary suffrage was justified in an essentially individualistic-meritocratic key: holding a certain amount of property was perceived to reflect both a “rough index of capacity, stability, and good will in the individual” (Pitkin 1967, p.191) and the best indicator of independence from undue influence. Actual legal arrangements (constitutional law) mirrored the philosophical presuppositions of limited government (constitutionalism). Classical systems guaranteed property protections as a matter of foremost principle, with the federal US Constitution of 1787 as the harbinger and preeminent example. By the same token, the defense of property against political encroachments regarded as illegitimate by constitutional default conferred upon public law an ancillary character. Just as the classical liberal state was the accessory of society, classical constitutional law was in effect “the accessory of private law” (Grimm 1987, p.195).
The entire paradigm started to be called into question with increasing urgency during the second half of the 19th century, not just as a result of the rising mass democracy but also, and perhaps primarily, by virtue of a structural economic upheaval: the advent of technologically standardized and concentrated late capitalism. In US law, due to the entrenchment of property protections in the Constitution and the legal and political entrenchment of the Constitution itself, the juridical stakes of the transformation were higher and more visible than in other Western democracies. The legislative and judicial ambivalence surrounding the Sherman and Federal Trade Commission Acts evinced foundational uncertainties from the onset (Henderson 1924). By the turn of the new century even the most fiery regulators and trustbusters were somewhat at a loss as to the deeper causes of and the possible solutions to the problems at hand, as Mr. Dooley’s rendition of Theodore Roosevelt’s first Message to Congress forcefully indicated: “Th’ thrust are heejous monsthers built up be th’ inlightened [*91] intherprise iv th’ men that have done so much to advance pro-gress in our beloved counthry. On wan hand I wud stamp thim undher fut; on th’ other hand not so fast.” (in Hurst 1984, p.84) The uncertainty remained, as the uneasy coexistence of different and irreconcilable economic philosophies within the New Deal reveals (Hawley 1966) and was by no means fully resolved by the post-New Deal (respectively, in other Western democracies, post-WWII) constitutional retrenchment to accommodate the rising administrative state. The ‘state of the industrial society’ (Forsthoff, 1971), with its blurred social, economic, political, and constitutional realities, was already firmly in place and there to stay.
The crux of the constitutionalist dilemma has been from the beginning of these metamorphoses: to what extent could property continue to be given a preferred constitutional status as a fundamental right once the general conditions of its acquisition, use, and disposition had changed so fundamentally? A deeper latent question was whether the initial constitutional protection of an individual right to property had reverted by force of the intervening events into the unjustified protection of an impersonal system, potentially oppressive of the individual. The reverse implication was also apparent. Constitutionalism (limited government) presupposes by definition a residual individual and societal zone of freedom from state interference but how and where would the new boundary be drawn, once a problem of first principle had turned into a matter of uncertain degree? The intervening time has magnified exponentially the scope of the challenges, as the causes of the initial domestic dilemma have been progressively universalized and intensified by the set of transnational processes collectively referred to under the umbrella concept of “globalization.”
Professor Nicol’s new book seeks to give a contemporary British answer to these fundamental and universal constitutional questions. While the general argument has a broader relevance and its essential tenor can be easily extrapolated to other jurisdictions, the primary concern of the book is with the impact of “transnational constitutionalism” on the British constitution. Nicol argues in essence that a number of transnational legal regimes (the WTO, the EU, and the ECHR) entrench neoliberalism with a juridical and political intensity that deserves the designation of “transnational constitutionalism.” This supranational entrenchment of neoliberal ideology in fundamental law (“the constitutional protection of capitalism”) has according to Nicol surreptitiously and progressively encroached upon British constitutionalism over the last decades and has by now illegitimately altered the latter’s essence.
The essential characteristics of the British constitution are defined in Chapter 1 as corresponding to the three main corollaries of the constitutional requirement of democracy, namely: contestability, relative ideological neutrality, and accountability (p.22). Parliamentary sovereignty, the primary principle of British constitutionalism, allows for a variety of ideological programs to alternate and potentially fully replace each other (pp.24-28). Since the major implication of parliamentary sovereignty is that no [*92] parliament is legally bound by its predecessors, each new election authorizes the victorious party to write its political program on a legislative blank slate. As one can already see, Nicol’s definition of (British constitutional) democracy and its requirements is of necessity ideologically agnostic. Namely, it relates only to the democratic value and the constitutional conditions of the collective possibility to choose freely among ideological worldviews in sync with the last election’s results (p.21). Nicol is ostensibly unconcerned with the relative justice merits of any given ideology, neoliberalism included, and professes to take issue only with the undemocratic, i.e., ideological choice-hindering, aspects of the transnational imposition. Global constitutionalism makes democratic choice less and less possible, by gradually entrenching one ideological model and imposing it from above and in perpetuity upon the domestic constitution. Thus, future political-ideological trial and error exercises are rendered ever more difficult. As Nicol persuasively argues, this is not an unforeseen consequence of impersonal processes and determinations. It represents the end result of a consistent and wanton strategy to by-pass the democratic process: the transnational imposition was, for the neoliberal forces which initiated the respective transnational processes a “constitutional insurance policy” against future domestic change. Neoliberally-inclined British political elites would had initially agreed upon a transnational status-quo that, once in place and fully consolidated, circumvented and rendered futile future political attempts at home to reverse the trend: “[t]here is the danger . . . that elections are increasingly providing democratic window-dressing for an entrenched reality.” (p.11) Transnational constitutionalism is defined “under (an) expanded conception of the constitution,” as ideological enmeshment and entrenched power. Namely, not just strictly legal obligations at international (WTO), supranational (EU), and regional-transnational (ECHR) law but also inescapable status-quo arrangements and power imbalances are factored in the definition: “Under the expanded conception of the constitution, a constitutional scholar can treat corporate power as contingent and contestable, just as any other feature of the constitution.” (p.11)
Chapters 2, 3, and 4, identify the essential features of the three regimes and the parallel developments that eventually coalesced into a unitary, neoliberal trend towards democracy, oppressive transnational constitutionalism. Whereas each chapter discusses a distinct regime, the general analysis distinguishes certain common processes that snowballed during the late 80s and 90s into the current arrangements. All these systems are said to have exhibited from the onset potential towards continuous “competence creeps,” whereby newer areas of competence, initially at the fringes of their main jurisdictional purviews, were gradually drawn into the mainstream range of attributions (e.g., the inclusion of public procurement and subsidies in the general WTO mechanism). A general “ratchet effect” tendency appears to characterize the three arrangements as well. For example, whereas at the beginning the EC and WTO systems were apparently able to accommodate a wide variety of [*93] economic models and social policies, the subsequent evolution ossified into one single framework, by accentuating systematically the bias for undistorted private competition in the neoliberal ideal-typical market. The systemic presumption against any form of public intervention in the autonomous operation of the transnational market processes is only rebuttable when intervention is needed to save from demise the neoliberal system as such (e.g., by means of bailout packages, such as is the case nowadays). To wit, in the EU, the neoliberal bias towards market liberalization has accentuated the tendency toward privatization and against public property. The latter process, although legally-analytically distinct, is implicit in the logic of the former and in the progressive operation of the system as such. Trends which favor the free operation of the market, once set in place, are very hard to reverse and “ongoing policy choice is therefore replaced with a once-and-for-all decision.” (p.76) For instance, once an area is liberalized, nationalization or milder forms of public intervention by subsidies or selective procurement policies are close to impossible. Thus, in effect, the purpose clearly expressed by the provision of Art. 345 TFEU, according to which the system of property ownership is reserved to the Members States and should have been unaffected by the exercise of Union competences, was in practice gradually defeated (e.g., discussion at p.112).
Competence creep and the ratchet effect of increased neoliberal orthodoxy are said to be the result of a number of systemic tendencies. Thus, a “structural bias” embedded in the operation of all autonomous regimes has led to the accentuation of primary purposes, irrespective of the qualifications that were initially included in the founding documents. Even though the initial treaties provided for leeway and a multitude of objectives, the original “Christmas tree” legislation was interpreted in accordance with the dominant teleological objective, and both the WTO and the EU slid on the slippery slope towards neoliberal fundamentalism. This structural bias is said to be at the same time obfuscated and abetted by the primary enforcement mechanisms of these regimes: judicial and technocratic institutions. Judicialization at fast pace is common to each of these regimes, albeit the institutional settings and the historical evolutions differ. In the case of the ECJ and the ECtHR we are dealing with initially stealthy and then ever more aggressive boot-strapping and power-grabs by the existing judiciaries (extensive interpretation of some provisions, reductive interpretation of others, fashioning new remedies, etc.). In the case of the GATT/WTO, the evolution of the transnational legal regime went hand in hand with the crystallization of dispute-settlement processes and the gradual maturing of loose and ad-hoc quasi-judicial procedures into the present, stable adjudicatory mechanism under the Dispute Settlement Union. Conversely, Nicol argues that judicialization is part of a larger neutralization trend, by virtue of which questions of difficult value-choice are “translated” and rephrased as problems of science and expertise and entrusted for decision to unaccountable institutions (see, e.g., comments on the “cult of the expert” in the EU, at p.107). [*94]
The last chapter sums up the argument and proffers as a solution to the neoliberal predicament the “dismantling of the teleological state.” The author dismisses potential transnational solutions to the problems as misguided, partial, or plainly illusory. As he convincingly argues, the state must be freed from its transnational neoliberal shackles at the state level. Nicol closes by contending that, since there was nothing inevitable in the initial slip towards the unfettered global market, the time has come to reverse the trend. This is an interesting, coherent, and timely argument, which reads well from beginning through to the end. In particular, the general discussion of the transnational “constitutional” regimes is often sophisticated and overall informative. Furthermore, it is hard not to be swayed by Nicol’s anti-neoliberal conviction. The relatively few reservations which may be raised knowledge-wise derive precisely from and are the flip-side of the qualities of his book as a piece of advocacy scholarship. Although the distinction is a matter of degree and the two extreme poles of the continuum are ideal types, sometimes the two formats (understanding the world vs. criticizing aspects of it and promoting their change) work against each other.
To begin with, the author works alternatively with and puts in opposition two definitions of the “constitution,” at the national and transnational level, respectively. This is an excellent advocacy device but the ensuing persuasiveness and rhetorical buoyancy come at the price of general epistemological usefulness. British constitutionalism is defined in a narrow legal-positivistic fashion, as residing essentially in parliamentary sovereignty. For instance, Dicey and Blackstone are referred to in support of the definition of parliamentary sovereignty. The citations are nonetheless selectively deceptive, since in Dicey’s famous account of the English constitution, the sovereignty of Parliament was only one element of the general, much richer description. Blackstone’s definition needs to be likewise contextualized. In fact, in COMMENTARIES, property is given a legal definition strikingly resemblant to that of parliamentary sovereignty (“despotic dominion”/ “absolute despotic power”). This pick-and-choose footnoting strikes a disingenuous chord but Nicol is forced by the polemical needs of his account to ignore or dismiss out of hand, in a dogmatically positivistic way, qualifications and reservations. For instance, Tom Allen’s argument that property protections have always been a part of British constitutionalism is rejected as “a relic of our pre-democratic past” and as constitutionally irrelevant (where “constitutional” strictly equals positive law): “a ‘fundamental law’ that cannot be enforced might be better regarded not as a fundamental law as such but rather as a durable political consensus.” (p.131) The version of democracy which informs and justifies this understanding of constitutionalism and parliamentary supremacy is – of necessity – equally reductive. Nicol defines as undemocratic “[advance commitment] to any set of rules and practices” (emphasis supplied, p.41). This definition is certainly possible in the abstract but such a Bakunian-Rousseauian-extreme Jeffersonian understanding of democracy is, if anything, at big odds with constitutions and constitutionalism. It is certainly at variance with [*95] English/British constitutional traditions, which have famously built, slowly and incrementally, on past practices.
In contrast to the positivistic “domestic” view of the constitution, transnational constitutionalism is defined pragmatically, in a strikingly critical legal realist fashion, as “enmeshment” and “entrenchment;” it includes private power and allows scrutiny of dominant power positions (both real and potential, apparently). The European Court of Human Rights is for instance criticized for interpreting Art. 1, Protocol 1 to the Convention in a way that privileges the right to property and protects existing possessions: “it is not a right to be put in possession of things one does not already have” (p.137). The Court in Strasbourg is also castigated for devising a balancing test that gives the right presumptive priority: “the majority managed to eradicate a balancing test in which the presumption would be in favor of the pursuit of the public interest by the state” (p.140). But then this is how constitutionalism and constitutional adjudication generally work. Interpretations of fundamental rights and interpretive tests devised for their application always privilege the rights involved to the detriment of potential causes for restriction (e.g., a balancing exercise involving the right to life will hopefully not give a presumptive vantage point to capital punishment). A similar observation goes for the property entitlements vs. property redistribution argument. Outside the worlds of Orwell, bad Marxian legal theory, and Humpty Dumpty, things cannot be made to mean their opposites, thus a right to “protection of property” could not be construed as a judicial roving commission to approve of or prompt redistribution policies. Furthermore, in evaluating transnational “enmeshment” even unsubstantiated suspicion seems an acceptable argumentative tool. Although Nicol admits that the ECtHR has been in practice, result-wise, fairly restrained in its interpretations of the article, the tendency as such is labeled as nefarious: the judges have wantonly opened the judicial door and neoliberalism will eventually step in.
As it is the general case with polemical exercises, one finds in the book a good measure of predictability. This was to be expected. At times, however, the brush strokes are rather thick and the impression is on occasion that Nicol preaches to the converted. Friedrich Augustus von Hayek, the expectable voodoo doll, is paraded twice through the argument but the reason is not fully apparent to the layman and, judging strictly from the text, the needle-sticking exercise seems largely ceremonial. At page 129, for instance, Hayek is accused of having emphasized “private property as an essential condition for the prevention of coercion.” That should apparently make the Austrian economist a forerunner of global neoliberal excesses and by implication an archenemy of British democracy. Nonetheless, as the reference is made, Hayek’s position is very modest, uncontroversial, and hence of little use to Nicol’s general argument, even as a straw man to be taken down. The overwhelming majority of political constitutional theorists, from Aristotle onwards, would agree with the above claim and ample historical experience proves it right. This brings us to a related but more fundamental issue. Nicol’s essential account of the causes of the present-day neoliberal sideslip is that of [*96] a political cabal. At the deciding moments when those arrangements were being devised, most major Western leaders were allegedly of neoliberal persuasion. They collaborated to entrench their predilections in international instruments. All went downhill from there, especially as more recent Labour leaders (i.e., Blair and Brown) defected to the dark side. Aware that this parade of horribles may read on the whole simplistic and conspiratorial, Nicol disclaims such implications but does so tongue-in-cheek and unconvincingly: “No belief in any grand conspiracy is required (although we cannot discount the possibility that such a conspiracy existed).” (p.18) Cloak and dagger scenarios are exciting, to be sure, but usually unsatisfactory outside their proper literary and theatrical settings. A demanding academic reader will still be left with an uneasy feeling, as he or she should be. Methodological orthodoxy requires the careful substantiation of claims to knowledge and “bad/gullible people” explanations to the evolution of complex systems are not in general very persuasive.
This leads to a final and germane remark of form, which addresses author and copy editor alike. Unfortunately, typographical errors and style mishaps in printed text – in moderate numbers at any rate – have come to be accepted as inevitable and pointing them out comes across as nitpicking. It was not always so but such are things now and the reviewer must be presumptively accommodating. Nonetheless, not all style and language mistakes are minor. Reading that “accountability to Parliament and accountability to the electorate are complimentary” (at p.35) is quite irksome. Even more disturbing is the misspelling of the major principle of international public law as Pacta sunt survenda ( at p.6), in a book dealing extensively with international public law regimes, rules, arguments (in the index, somewhat better, the word, wrongly cited in an article title, is misspelled as “survanda”, at p.175).
Professor Nicol’s warning regarding the global tendencies towards the gradual suppression of genuine political choice and constitutional democracy and his call to action against these trends are timely and commendable. More substantial work will be needed in the future to unravel the crucial specifics: how did this oppressive phenomenon come about and how, if at all, can constitutional democracy escape its grasp.
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Grimm, Dieter. 1987. RECHT UND STAAT DER BÜRGERLICHEN GESELLSCHAFT. Frankfurt a. M.: Suhrkamp. [*97]
Hawley, Ellis. 1966. THE NEW DEAL AND THE PROBLEM OF MONOPOLY:A STUDY IN ECONOMIC AMBIVALENCE. Princeton, N.J.: Princeton University Press.
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Pitkin, Hanna. 1967. THE CONCEPT OF REPRESENTATION. Berkeley, CA: University of California Press.
Willard Hurst, James. 1984. LAW AND THE CONDITIONS OF FREEDOM IN THE NINETEENTH CENTURY UNITED STATES. Madison, WI: University of Madison Press.
© Copyright 2011 by the author, Bogdan Iancu.