Sunday, January 27, 2013

Debra Satz on banning markets

Debra Satz's book, Why Some Things Should Not be for Sale: The Moral Limits of Markets is a kind of book I rarely encounter. It endorses a thesis I find fundamentally nasty, i.e., "an invasion of contract by status, the subordination of market price to social justice, the replacement of the free bargain by the declaration of rights." But it was also enjoyable to read. The author presents a clear case (mostly), genuinely understands the strength of her opponent's points (usually), and holds back from drawing overly sweeping conclusions (typically).

Satz begins her book by outlining reasons why markets are good. She notes two primary virtues of markets - markets are efficient in their production and allocation of goods and services, and markets enable freedom for people in allowing them to choose what to buy and sell. She immediately follows this with the textbook accounts of market failure - imperfect information, externalities, etc. Gratifyingly, she also notes that market failure does not by itself justify government intervention: "Of course, even if markets generate inefficiencies due to externalities, the alternatives might be worse. Perhaps some market inefficiency is preferable to a lot of government regulation, with its slow, clumsy, and lumbering bureaucracy."

Her fundamental thesis actually isn't very controversial. She argues that limits on markets, or lack thereof, can't be justified in terms of economic efficiency or inefficiency. This statement, by itself, should be immediately acceptable to anyone of a libertarian bent. Libertarians, particularly of the deontological variety, are often very quick to argue that market inefficiency does not, by itself, morally justify intervention. Satz is arguing from the opposite side of the field - she contends that markets operating efficiently does not morally rule out intervention. The question, then, is a matter of what moral system should be used to make that kind of decision.

Of course, even that by itself isn't enough to challenge libertarianism, per se. Even the most hardcore anarcho-capitalist would recognize that some contracts are illegitimate. No doubt Murray Rothbard or Walter Block would find the idea of a market in assassins an anathema. They would argue the (moral) principle of non-aggression would prohibit such contracts.

To her immense credit, she does make an effort to note many limits to her approach. She freely acknowledges that "we cannot immediately conclude from the fact that a market is noxious that we ought legally to ban it." The "cure," after all, can be worse than the disease.

Satz thinks certain markets can be made noxious, in her terms, if they meet the following conditions.
  1. They impose extreme harm on one or both market participants.
  2. They impose extreme harm on society at large, such as a market for blood diamonds that funds genocidal conflicts.
  3. They arise from weak agency - one party is ill informed or incapable of making an informed choice. Children, for example.
  4. They occur when one party is highly vulnerable, with little or no alternative options.
She goes on to examine several different types of markets she believes meet these criteria, and examines what policy implications can be drawn from them. Before I talk about those, however, I want to note a problem to her approach that seems, to me, fundamental. 

Her case seems too reliant on a "reasoning backward" technique. She didn't independently consider conditions 1-4, decide they were bad, and then set out to see what markets might meet those conditions. She started from the premise that these markets were problematic, and then reasoned backwards from there to try to figure out conditions that would justify this conclusion, settling on conditions 1-4. In many cases, she starts her discussion by pointing out that more mainstream egalitarian arguments against such markets are, um, not very good. She offers her own framework as providing a more solid justification for those conclusions.

This makes me think back on the work of Jonathan Haidt in The Righteous Mind and Robert Kurzban's wonderful book Why Everyone (Else) is a Hypocrite: Evolution and the Modular Mind. In Kurzban's words,
First, and in line with one of the central arguments of this book, we don't know the reasons we morally condemn various acts. We just think they're wrong and say they're wrong, and try to justify this view. The problem is, of course, that the justifications we give are so inconsistent that it's easy to show that the justification must have come after, rather than before, the moral judgment.
She seems to briefly acknowledge this when she says:
Some may wish to question placing so much moral weight on our intuitive reactions to particular markets as I have done, pointing out that people were once horrified by the idea of life insurance. Perhaps many of our reactions are little more than an irrational repugnance at that which we dislike. Still others may find particular markets objectionable that do not seem to run afoul of any of the criteria that I have proposed, for example, a market in supermodel eggs or Nobel Prize-winner's sperm or a market in a good whose sale violates their deeply held religious values. 
It seems to me there are many areas in life that meet at least one of her conditions that clearly do not admit of government intervention. Religious teachings, for example. Consider the following hypothetical. Jehovah's Witnesses teach that blood transfusions and organ donations are inherently immoral. From time to time, adherents of this religion find themselves in need of medical treatment that violates their religions precepts, and will die refusing that treatment. I think "death" qualifies as "extreme harm." If these religious beliefs were to become widespread, it could completely shut down all donations in organs and blood - certainly a harmful outcome for society. Furthermore, these beliefs are often introduced and ingrained into a person during childhood, when a person has "weak agency." And someone who holds these beliefs is in the most vulnerable position of all. They face death if they refuse treatment, but in their mind if they accept treatment they place themselves on God's bad side, which is the only thing that could be considered even worse than death, so these people literally have no choice but to die.

But if you think this means it's acceptable for government to start interfering in religious practices, I'll punch you in the face. (Not really.) This hypothetical person should be allowed to die for his stupid, stupid beliefs, because religious freedom is fundamental, and he's not violating the rights of anyone else. This seems as plain to me as anything. I'll freely grant that he adopted these beliefs under weak agency, and is vulnerable. I'll grant that this behavior leads to extremely bad outcomes for individuals who practice it, and for society at large. Not good enough.

"But wait," I hear everyone at home saying, "That's different! A person's religious beliefs are not at all like market transactions!"

You might think so, but Debra Satz's framework gives us no reason to think so. She claims (falsely, in my view), "Market theorists ignore the role that markets have in shaping relationships among individuals and social groups." Given the fact that human preferences and values are not exogenous to the market - they are shaped within and influenced by the market - this, to her, makes markets an area of public concern, and therefore subject to legal scrutiny and regulation. But that's all equally true of people's religious beliefs. Every aspect of human culture has a role in shaping relationships among individuals and social groups. Though her book is about why some things should not be for sale, there is nothing about the moral framework she describes which makes it limited to events where money changes hands. If anything, the addition of money should make it less bad, no? If someone with weak agency agrees to sell a kidney, at least they make a buck off it. Someone indoctrinated to believe in treating illness exclusively with prayer and who dies a slow, painful death refusing a kidney transplant doesn't even get that. All they get is dead.

Since I think her explanatory framework falls flat right out of the gate, it goes without saying she failed to persuade me about specific markets. Part of the reason I found her case unconvincing is it's what I'll call a denominational argument. It's written like a book arguing for Methodist theology over Presbyterianism. It might make for an interesting read, but if you aren't already convinced of the truth of Christianity, then you won't end up a convinced Methodist. Similarly, this book takes egalitarianism pretty much for granted - it's an argument for a specific interpretation of egalitarian political philosophy. But her defense of egalitarianism as such isn't unpersuasive so much as it's nonexistent. If you're already an egalitarian, then this book might challenge you. If you're not an egalitarian, though, there's nothing here that explains why you should be.

What I found most troubling about her world view comes out when she's discussing gender issues. Let me explain.

Satz is deeply concerned with career differences between men and women. Her arguments in this section can get rather slippery - for example, in order to demonstrate that divorce has (present tense!) a larger impact on women than men, she quotes statistics from the 1970s. But a much larger problem here is the way she objects to household lifestyles. A major reason women earn less than men, on average, is "women assume disproportionate responsibility for domestic chores and raising children." She criticizes Ronald Dworkin's theories as insufficiently egalitarian (!) because:
Dworkin's market scheme offers no guidance as to what is problematic about current job structures or the gendered division of labor...How would Dworkin's theory respond to women who forgo paid work in order to care for their children or elderly parents? His theory would seem to imply that compensation to such caregivers is unnecessary because the inequality in income reflects a lifestyle choice...
To Satz, these lifestyle choices are in some sense invalid, because these preferences are influenced by social expectations and therefore not "real" preferences. Wherever there is a notable difference in the choices that men and women make, she declares it the result of women being "socialized" to think that way. She has somehow ascertained that in a vacuum, men and women would have identical preferences and make identical choices.

This kind of concern with gender issues is a large driving force in her views of two "noxious" markets - prostitution and surrogate mothers. She warns us that "contract pregnancy contributes to gender inequality by reinforcing negative stereotypes about women as 'baby machines.'" Likewise, she views "prostitution's wrongness in terms of its relationships to gender inequality," saying prostitution "makes an important contribution to women's inferior social status."

These are her main reasons for thinking both prostitution and surrogate motherhood are noxious markets. She doesn't think prostitution is wrong-in-itself. In speaking of pro-prostitution feminists claiming it as their rightful control of their own sexuality, Satz says "I agree that in a different culture, with different assumptions about men's and women's gender identities, prostitution might not have the harmful effects" about which she's concerned. Surrogate mothers present the same problem to her - she acknowledges that "A consequence of my argument is that under very different background conditions, such contracts would be less objectionable."

This means she's willing to consider a market in violate of conditions 1 and 2 if they give people a bad impression of the participants even if she doesn't think those impressions are true. Rather than fighting incorrect ideas, she seems to think that, because the incorrect views are widely held, that gives us a reason to think they should have the force of law.

But how far is she willing to extend that line of reasoning? Homosexuals have been condemned and marginalized over their sexuality. And there have certainly been parts of gay culture that have been seized upon by sexual conservatives as proving their "point" about gay people. As can be expected, The Onion has a fine piece of investigative journalism demonstrating this very point. But would Satz really argue that this makes a case for government shutting down gay bars, or banning gay pride parades?

Though she actually concludes prostitution should be legal after all, the basis on which she does so is disappointing. She sums up by saying:
The question is whether the current legal prohibition on prostitution in the United States promotes gender equality. The answer, I think, is that it does not. The current legal policies in the United States arguably exacerbate the factors in virtue of which prostitution is wrong.
I agree that prostitution should be legal, and I agree that criminalizing it creates needless problems. Her query about if the law "promotes gender equality" is what I find problematic. To me, legal gender equality means that the same laws apply equally to men and women. But to Satz, it means using the law to create equality. The equality she seeks is equality of outcome, which is why she's troubled by the different choices men and women make. As long as men and women are making different choices, simply having the same rules apply equally to both parties will not be enough to bring about results that look the way she thinks they should.

But just because her analysis takes a hard left at the corner of "Batshit" and "Crazy" when it comes to gender issues*, that doesn't discount the whole book, right?

Her views on child labor are better formed, I think. The issue of children has caused many libertarians to produce their worst work. Cough cough Murray Rothbard cough The Ethics of Liberty cough Chapter 14 cough Excuse me, where was I? Oh right, child labor. She spends much of her chapter on child labor talking about all the reasons to not like it, but her conclusion is gratifyingly grounded in reality.
Child labor was once prevalent in what is now the industrial world. Eliminating it in poor societies may not be feasible on the basis of the resources and institutions of those societies. 
She even seems to come to the conclusion that the problems we have with child labor is a result not of free markets, but instead of corrupt government policies, noting that "Even if one grants that in some circumstances children must work, there is no doubt that children are worse off than they would be if laws created and enforced genuinely free markets," and says one of the most helpful things we can do here in the First World is "ending protectionist policies that close off markets to poor countries." Rock on! The only prohibitions she endorses are regarding child slavery and child pornography, putting her on the opposite side of absolutely nobody.

More often than not, she ends up concluding that an outright ban on markets causes more harm than good - and this conclusion comes from the recognition that you can't ban markets, you can only create black markets. When committed egalitarians still find themselves more pro-market than not, it's a good sign of the times, I think.

*Seriously, she gets crazy at some points. This is what she says about rape.
Society views rape differently because, I suggest, many people think that women really want or deserved to be forced into sex, treated as objects for male pleasure.
Note, she's not attributing that view to the occasional sociopath or nutjob - she thinks that's a common enough view to be attributed to society at large.

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