File spoon-archives/bhaskar.archive/bhaskar_1997/97-03-08.181, message 1


Date: Sat, 11 Jan 1997 02:17:01 -0800 (PST)
From: LH Engelskirchen <lhengels-AT-igc.apc.org>
Subject: BHA: excerpt pages


 
<Secure in the knowledge that anyone who wants to *ignore* this
message can, I'm posting a half-dozen pages from the article Hans
has critiqued.  These explain the concept of autonomy I use,
summarize the link between autonomy, exchange, promising and
consideration, reflect the style, and contain, in the penultimate
paragraph, the crop failure caused by drought example>:
 
 
A retroductive argument concerning consideration would ask what the
world must be like in order for the doctrine of consideration to be
possible.  In synopsis, an answer might run as follows:  the world
presupposed must be a world of promises, for consideration emerges
as a means to demarcate enforceable from unenforceable promises. 
But promises have not always played a significant role in legal
life[FN 10].  Roman Law, for example, never developed a general
basis for enforcing the reciprocal exchange of promises[FN 11]. 
Some promises when exchanged could be enforced, but there was no
general social rule recognizing an obligation to enforce mutual
promises.  This phenomenon emerged only in market economies
developed to the point where the general circulation of goods and
services had become a basis for production.  We may suppose
promises to exist in all forms of human existence and
interchange,[FN 12] but the promises presupposed by consideration
are of a historically specific rather than general character.  They
are promises formed and shaped by the world of private exchange. 
A vassal promises fidelity to a lord, but this is not a promise
which gives rise to Restatement (Second) of Contracts, s71.[FN 13] 
The universe of promises with which we are concerned includes only
those which presuppose private exchange.
 
Private exchange itself presupposes people distributed in
identifiably specific kinds of social relations.  People in all
forms of social life give goods back and forth, but this need not
involve private exchange in the sense of a reciprocal transfer of
goods or services between persons formally independent of one
another[FN 14].  Exchange within status or kinship societies
remains subordinate to kin and status relationships.[FN 15]  It is
when the members of a society function as formally independent
units for the production and distribution of wealth that private
exchange emerges.  The family farm of the early U.S. is an
archetype of such independence -- a self-sufficient household unit
producing the bulk of its own means of survival, but tied to the
market for certain essentials.  Yet the paradigm extends as well to
the working family today -- such a family is completely dependent
on the market; it finds employment and all goods and services of
which it has need in the market and its members enter market
relations as autonomous economic units.
 
Market economies emerge where autonomous individuals or groups
exchange specialized production they do not need for goods and
services they do need.  Where produced wealth is held autonomously
and exchange between private possessors becomes a regular
interaction, a tendency for the production of each to become
specialized is accentuated.  If the process is repeated under
circumstances favorable to its development, a more or less fully
integrated system characterized by a social division of labor
develops.  Each individual or separate economic unit becomes
dependent upon exchange for things they have come to need and
exploits the skills and resources they have as a means to obtain
the things they need.  In this fashion the system generates a
tendency for its own reproduction,[FN16] and the intensity of this
tendency is heightened the more deeply entrenched private exchange
becomes.  The more people in their needs have become dependent on
the perpetuation of exchange, the more the social division of labor
develops.  Reciprocally, with every advance in the social division
of labor, the force for its reproduction becomes stronger and more
consolidated. Thus these two features characterize a private
exchange economy:  the private autonomy of person and property and
an interdependence generated by the social division of labor.  I
will refer to this structure of social relationships as a
relationship of interdependent autonomy.
 
This is the social foundation.  From here we can reverse the path
of our retracing.  If there are to be both private autonomy and the
social division of labor, then there must be private exchange. 
Private exchange makes possible the reproduction of the one and the
other and the one with the other.  I teach and offer my services as
a teacher and am paid in return with a token representing a command
on anything any other person or persons has produced.  I'm able to
live without the skills to produce food, shelter or clothing.  A
municipal bus driver develops skill in providing transportation
services.  The person who farms devotes herself to farming.  In
each case specialized skills exercised autonomously generate a
product exchanged for goods and services capable of meeting some
portion of the totality of a person's needs.  In this way private
autonomy and the specialization of activity persist and are
socially reproduced.  
 
Private exchange gives rise necessarily to promising.  With
promises goods can be delivered before payment or payment can be
made before goods are supplied.  The exchange of products is
facilitated by arranging for exchange before the items contracted
for are even produced.  A producer can devote more time to
production and make that time more efficient if she is sure of
market outlet.  As it develops, therefore, private exchange
generates a need for promising and the institution of promising
tends to be transformed accordingly. 
 
But in the context of private exchange, promising presupposes more. 
While promising involves cooperative activity of persons over time,
since each person serves his or her own interest, each looks, in
the transaction of exchange, to self-interest.  Self-interest,
however, changes.[FN 17]  Drought causes a crop to fail and makes
performance of a contract to deliver grain impossible.  If a
person's promises are to be performed or the harm caused by
nonperformance redressed, the promisor will sooner or later have to
be compelled to comply.  Along with the production and exchange of
goods and services, we need to consider institutions of coercive
compliance.  In other words, a developed system of private exchange
presupposes a developed system of law.  Private exchange in and of
itself is not enough to reproduce a system characterized by private
ownership and the social division of labor:  the exercise of social
coercion is also necessary if reproduction of social relations in
this form is to be assured.
 
The forms for the exercise of coercion are driven by the need to
reproduce the underlying structure of private ownership and the
social division of labor.[FN 18]  For example, before public
coercion is used to enforce any particular exchange, it is
essential for there to have been a surrender, whether by word or
act, of that formal independence from others given by the social
form of private autonomy.[FN 19]  My decision to exchange or not is
my own.  I am driven implacably to exchange by the dependence of my
needs upon it; this is a social fact, the consequence of a system
of social relations I experience as given.  Nonetheless, there must
be choice in where and when and under what conditions I intersect
with others if exchange is to reproduce private autonomy; there
must be an expression of willingness to submit oneself to exchange. 
Other forms of social interconnection are possible obviously -- one
person can make use of others without their consent as in various
forms of bondage; alternatively, members of a group can transfer
goods among themselves cooperatively -- but these are not social
forms characteristic of a private exchange economy.  Where promises
are reciprocally given within the context of private exchange, each
participant must bargain for the performance of another and obtain
the consent of the other for whatever is received.  It follows that
in giving consent each manifests a willingness to give up his or
her autonomy to that extent.  This is a necessary implication of
what a private exchange economy is.  The prohibition of theft
reflects the same dynamic:  as a nonvolitional transfer of goods
within the framework of private exchange, theft is inconsistent
with the reproduction of private autonomy.  Exchange requires a
volitional relinquishment of autonomy appropriate to the
reproduction of the social relations of private autonomy and the
social division of labor.  In Anglo-American law the legal doctrine
which fulfills this function is consideration.
 
FOOTNOTES
 
 
    [FN 10]   See, e.g., Lon L. Fuller, The Role of Contract in the
Ordering Processes of Society Generally, in The Principles of
Social Order 169, 182 (Kenneth I. Winston, ed., 1981):  "it is a
commonplace of anthropology that explicit contractual arrangements
are a rarity among primitive peoples."  E. Allan Farnsworth, The
Past of Promise:  An Historical Introduction to Contract,  69
Colum. L. Rev. 576, 590 (1969), observes that in William Golding,
Lord of the Flies, (1954) the island's schoolboys did not "bargain
for the exchange of each other's promises," and he continues, "In
this their experience mirrors that of man as a whole, who has shown
little concern with such matters for most of his quarter of a
million years existence."
 
    [FN 11]   See, e.g., Alan Watson, The Law of the Ancient Romans
58 (1970) ("Roman law . . . has no general theory of contract but
a number of different contracts.").  See also, Farnsworth, id. at
590 ("But neither the innominate nor any of the other enforceable
contracts resulted in the development of a general basis for the
enforcement of promises that would include a promise made in
exchange for another promise, where there had been no formalities
and no return performance.").
 
    [FN 12]   Cf. Samuel Stoljar, Promise, Expectation and
Agreement, 47 Cambridge L.J. 193, 204 (1988):  
 
In this light, again, it is difficult to imagine a so-called
"prepromising" (or non-promising) society.  It is not that we could
simply assume away the concept of promising; for if we did what
would become of the related concepts of intending or expecting, how
would it make sense to make future arrangements?  Can there be a
human society in which people do not know what it means to declare
intention or recognize expectations, do not plan things to be done
for or with another?  Promises, it is therefore clear, are as basic
in our conceptual equipment as are other notions that articulately
orient us toward the future.  So an often cited remark, attributed
to Holmes, to the effect that promises were invented when the
future was invented, contains a solid grain of truth, even if at
first sight it seems little more than a literary exaggeration.
 
    [FN 13]   Cf. P.S. Atiyah, Promises, Morals and the Law 92
(1981):  "The idea that a person could alter his legal relationship
with others merely by his free choice is a feature of advanced
legal systems."  
 
    [FN 14]   See, Farnsworth, supra note 10, at 578-582 in "A
World Without Bargain," (discussing the self-sufficiency of the
Ammassalik of Greenland, sharing among the Zuni of New Mexico, and
the potlatch of the Indians of the Pacific Northwest -- all
societies which did not rely on exchange based on bargain; and see,
Marcel Mauss, The Gift 5 (1990):
 
In the economic and legal systems that have preceded our own, one
hardly ever finds a simple exchange of goods, wealth, and products
in transactions concluded by individuals.  First, it is not
individuals but collectivities that impose obligations of exchange
and contract on each other. . . . Moreover, what they exchange is
not solely property and wealth . . . . such exchanges are acts of
politeness:  banquets, rituals, military services, women, children,
dances, festivals, and fairs in which economic transaction is only
one element, and in which the passing on of wealth is only one
feature of a much more general and enduring contract.
 
    [FN 15]   See, Farnsworth, supra note 10, at 582 (showing the
dominance of kinship by the fact that bargaining becomes a basis
for becoming part of a kinship group). 
 
    [FN 16]   I use reproduction in the sense of a material and
social process which assumes individuals acting in particular ways
in relationship to things and to each other.  As such it is a
social process which includes (at least) a material dimension of
action, (causing the world to be other than it would otherwise be)
and a social dimension of structured relations among people,
including an expressive dimension of meaning always present in the
things people do.  I argue that exchange is a social relation which
plays an essential role in the process of social reproduction.  The
act of exchanging goods and services is a consequence of autonomy
and the social division of labor.  But the act of exchange
recreates the conditions for these social relations to be once
again constituted.
 
    [FN 17]   Cf., Steven J. Burton, Breach of Contract and the
Common Law Duty to Perform in Good Faith, 94 Harv. L. Rev. 369, 377
(1980):  
 
By hypothesis, a party enters a contract when it believes that no
greater benefit can be derived by expending elsewhere the resources
required for the contract performance.  Events between the time of
formation and the time of performance may prove this belief to have
been erroneous.  Before its own performance is rendered, a party
with a losing contract may seek to recapture foregone opportunities
to the extent possible.  This can be accomplished only by
redirecting the resources committed to the promised performance and
therefore by failing to perform the promise.  
 
A buyer of corn, for example, may fail to perform a contract for
future delivery for a large number of reasons. If the market price
falls the buyer will wish to recapture the opportunity of buying on
the spot market or on a changed futures market.  If the buyer gets
a hot tip on the potato market, it may wish to redirect purchase
money earmarked for the corn contract to enable it to purchase more
potato contracts.  If investor confidence in the commodities market
slips, the buyer may wish to move its business into stocks or real
estate or may wish to go out of business.  These and other uses for
the resources committed to the initial corn contract may be
opportunities necessarily foregone when entering the corn contract.
 
E. Allan Farnsworth & William F. Young, Contracts, Cases and
Materials 1 (5th ed. 1995) introduce students to the idea of
contract by reference to cotton farmers less than eager after
harvest to carry through with forward contracts made before
planting;  a 50c per pound change in the market price provided the
incentive to see self-interest differently from before.
 
    [FN 18]   I limit my attention to the formal exercise of
coercion in law.  Informal pressures in exchange are significant,
of course; see Stewart Macaulay's classic study, Non-Contractual
Relations In Business: A Preliminary Study, 28 American
Sociological Review 55 (1963). 
 
    [FN 19]   The independence is formal only because in fact
persons are dependent on one another as a consequence of the social
division of labor.
 



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