THE ECONOMICS OF LAW

Law functions when people can do more harm to others by following law than by breaking it. The separation of powers amounts to channeling people’s natural impulses to harm one another, into checks and balances. So that the law is given force from the fuel of human malice.

Judges would like to lock competing proud people in their basements and torture them. Governors would like to lead hordes to slaughter whole cities. The law gives the greatest number of such people the chance to come as close to their dreams as possible, through the act of enforcing the law upon others. Sort of like a football game gives people something to humor their impulses.

It has been noted since Adam Smith that the baker bakes bread not because he is generous, but because he is greedy. He is surrounded by social institutions and incentives, that enable him to serve more of his own lusts by baking bread that other people want to buy, than by deciding any other course of action. The baker can buy more hookers and fishing boats, the better his bread is.

Society is evolved to process as much information as possible, by using distributed decision making. To process all the information that needs to be processed, to make all the decisions that need to be made to benefit society, requires distributed decisions made by independent local specialist decision makers. Each person applies his own knowledge to the information right in front of him, which information is known to nobody else. The more things are instead decided by a social collective from a mushy vantage point, the less information and expertise they will use, and the worse the decisions will be.

The general properties of a distributed decision maker is one that brings together

1) knowledge of the domain, e.g. farming,

2) information the knowledge is applied to, e.g. the precipitation in a certain tract of land, and

3) incentives and constraints that convey public costs and benefits to decision makers, e.g. the price system.

It is easy to understand how the price system, and courts providing civil lawsuits and prosecution of fraud, convey the incentive to the baker to bake bread, rather than to poison people. The problem with courts (and many other decision institutions), is that you cannot turn deciding who is guilty over to the price system and “the free market”, to spontaneously create independent decision makers. You have to make the decision using some combination of voters and government employees.

The purpose of “due process” is to manufacture such an incentivized and informed private decision maker without the price system. That is where judges and juries come in, which are supposed to function like independent businessmen, making private decisions which nobody else will ever have the information to know if they were right.

For jury trials, the judge brings the domain expertise by instructing the jury. The decision-specific information is provided to the jury by the prosecution and defense (needing separate institutions to make sure they don’t lie). The public benefit is conveyed to the jury in the rules of the laws themselves, rather than by prices. And the interest of the prosecutor to convict the innocent for votes, or of the public to decide who is guilty based on gossip – the human impulse for the collective to decide – is removed, by handing the decision on guilt over to this independent decision maker.

Checks and balances provide a limited form of competition, where different departments make sure other departments are following the rules to reach their decisions (deter breaking the rules with occasional severe punishments), even though they can never have the resources to double-check whether each decision was right.

But you are still left with the problem: Does a state governor or local judge get more chances to satisfy his lust to harm others, by following the law or by ignoring it? Can a governor harm more people by prosecuting cops who lie, or by letting cops lie to prosecute thousands of innocents? Can a judge get more pleasure by harming the ambitions of the governor or prosecutor, or by cooperating with a governor or prosecutor to harm the innocent?

It is supposed to provide great pleasure to judges to lord the law over governors and prosecutors. The enjoyment of standing in the way of some vain scumbag like Ron DeSantis, should satisfy the vanity and self importance of the most sadistic judge. The problem occurs when the state governor or prosecutor still has some power over the judge, so that the judge cannot totally force the prosecutor or governor to submit to him. Such as if the prosecutor or governor can stop a judge getting elected, or influence the judge through other political or financial motivators.

The executive branch can also dominate the judge if the governor or prosecutor can simply provide lies in court, which lies the judge is then forced to apply the law to.

And remember, newspapers can’t uncover the lies and incite the public against them, because who decides who gets sued for defamation? The government. And they will say reciting the government’s politically popular lies is a protected First Amendment right, whereas anything else you can be sued. And when police retaliate for political speech by arresting you, the legal standard is that you have to prove a cop you never met innocent of imagining the possibility of a crime from your own knowledge, before being able to confront the cop as witness or produce discovery. So just like the baker makes more money by deciding to bake bread people like, publishers make more money by deciding to print what the government wants them to print, without needing to spend money on investigative journalists, editors, or lawyers.

So the judge is faced with a “plata o plomo” problem, to cooperate by applying the law to lies, or to stand in the way of the executive branch and suffer the consequences? So judges and the executive branch come to a truce, where prosecutors and state witnesses are allowed to lie to the court, and judges are still allowed to enforce the law, just applying the law to the “facts” selected by government, by assuming those lies are true.

A member of the executive branch can always harm more people, and make more members of the bloodthirsty mob happy, by ignoring the law. The only solution to this, is when judges can obtain pleasure by forcing total submission on such executives without fear of any cost. And when the malice of other judges, and the law, filter through some structure of pride and vanity and power, to where judges can lord over each other more by following the law than by ignoring it.

So the entire structure of society, meaning the creation of independent decision makers through rights, depends on whether judges can choose to get more power and pleasure and pride by following the law than by ignoring it. This is undermined when following the law has disincentives, such as when following the law creates more work than ignoring the law, or when judges who follow the law suffer revenge from the majority faction.

The survival of civilization ultimately comes down to whether the people demand judges follow the law as independent decision makers, or whether the people demand judges enforce the majority’s own collective whims and accept popular gossip as fact, meaning do whatever voters decide judges should do in each decision. If the people turn judges into members of the executive branch, rather than having a fetish for judges enforcing the rules of the law on the powerful, then rights and independent decision makers give way to the collective will enacted through the executive branch, like most nations through most of history.