Monday, September 21, 2009

Predation and property

That (Western) Europe’s economic ascension began in the medieval period seems now well established –Maddison, Jones, Gimpel, Landes (amongst others) all make the same point in different ways. That Japan is the other standout is also clear (a point made very clearly by Maddison, Jones, Landes, Powellson and others). The Roman order turned out to lead to social stagnation and decay(*), the knightly order (which came to cover more of Europe than the Roman Empire) led to dynamism and growth, rivalled only by the samurai order of Japan. But Japan shared with Europe competitive political pluralism in a geography which militated against political centralisation, an agriculture which encouraged self/family/village-reliance, experienced sufficient institutional stability to permit long-term social learning and sufficient cultural commonality to intensify ‘bidding’ competition for skills, capital and ideas.

In both Europe and Japan, local rulers faced competition for moderately mobile capital and skills. This tended to drive rulers towards lower levels of predation and higher levels of public good provision, in slow-motion ‘auctions’ for capital, talent and labour.

Having an elite who were genuine landlords, with recognised property rights (which became extended to their tenants), so had incentives to invest and husband resources (human or otherwise), was far more stably economically productive than, as in the rest of Eurasia, having elites who tax-farmers – at best decayed into insecure landlords ruling insecure tenants – seeking maximum returns over minimum time-scales with minimal incentives to invest or husband resources.

Or, to put it another way, the vast majority of human states have been primarily structures of social predation. Domestic predation providing the bulk of the returns and public goods (law, order, defence, roads, etc.) being provided to the extent needed to extract higher returns. In both Europe and Japan, structures evolved which limited domestic predation while increasing the extent and quality of provision of public goods. In the rest of Eurasia, anytime society seemed to be evolving in such a direction, some bunch of nomads would rage through and level institutions back to insecurity-through-predation.
The first stage of evolution towards secure property rights was lowered central control, which increased vulnerability to external conquest. It is probably no accident that the areas that displayed the strongest evolution towards the Western model of strong property rights and representative government had significant geographical barriers to external conquest (Switzerland, Netherlands, Scandinavia, British Isles). Spain, which also has such barriers, suffered from the curse of silver.

Of course, this is an understanding of the state based on history extending beyond Western experience. An example illustrates the insecurity effect. British rule in Ireland led to insecure landlords and insecure tenants, creating “Asiatic” poverty – C18th and C19th Ireland was notoriously the poorest region in Europe – culminating in a very “Asiatic” (potato) famine. The Irish reputation for fecklessness is part of a much wider pattern: insecure servile labor, insecure tenants, indigenous people under ‘protective’ regimes, all acquire reputations for fecklessness – all manifesting the (dis)incentive effect of insecurity on effort. Collectivised peasants, welfarised indigenous peoples, socialist workers and government employees acquire similar reputations, due to the separation of return from effort. (Slaves suffer both insecurity and no returns, which is why they are competitive only in circumstances of tight control, typically rote production where control is easiest. Despite comforting analytical myths to the contrary, however, slavery can be quite competitive in such situations.)

During the late C18th and C19th—living in the least domestically predatory and highest provider-of-public-goods states in human history—the idea arose among the Western intelligentsia that the state was naturally a vehicle of human liberation, so that the more it did, the better: a delusion flatly contradicted by millennia of human experience. But what was mere human experience against their splendid theories, their secular gnosis, their liberating knowledge? Even worse, they came to focus their analytical animus on precisely those institutions that most limited state predation (particularly secure property rights). Serious prosecution of this delusion created the most megacidally internally predatory states in human history. That the first of said states – the Soviet Union – revived state slavery through its labour camp system (and, indeed, a form of serfdom) was the pinnacle of grim irony. That a state based on rejection of ‘exploitation’ proceeded to become, under Stalin, the most ruthlessly efficient extractor of surplus from its population in human history was an even greater one.

‘Exploitation’ being, of course, the dreadful danger someone may be making a profit. Which is not the way the intelligentsia typically makes its money – if private profit was how most of the Western intelligentsia received its income, we’d never hear the end of what a wonderful thing it is. After all, when the intelligentsia (and their audience) was dominated by people deriving income from their own property, or from the patronage of property-owners, the virtues of private property was all the rage. As intelligentsia (and their audience) became dominated by those paid like other employees, property became wicked. The more paid for by taxes the intelligentsia (and their audience) became, the more inherently wonderful state action became. (And, yes, there are obvious exceptions in other directions; it is the overall tendency that is significant.)

This delusion of state-as-natural-vehicle-of-human-liberation had clear appeal in places where the notion of the state being something other than primarily a vehicle of social predation was something of a revelation. It also seemed a simple path to modernity. This, alas, turned out not to be true.

Meanwhile, those societies that, eventually, decided to do (broadly) what the West had already done, surprise, surprise, proceeded to catch up with the West. Those who took the oh-so-cutting-edge advice to do something completely different from what the West had done, did not (to put it mildly). Some of the latter, such as China and Vietnam, have since switched back to adapting Western experience, thereby showing a capacity for social learning. History can teach us things, but only if we look at it sufficiently broadly.

* The ‘deal’ of citizenship traded political and civil rights for military responsibilities. When the Roman Imperium became effectively a universal state, the trade-off was no longer required. So the Roman state decayed towards the normal pattern of domestic predation, with the typical long-run consequences of that (declining efficiency due to diversion of resources to a growing layer of corrupt officials, culminating in takeover by warrior-pastoralists).

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