Roscoe Pound observed more than a century ago that in “all cases of divergence between the standard of common law and the standard of the public, it goes without saying that the latter will prevail in the end.” I suppose if one sentence could sum up my research agenda, that would be it (let us not pause to consider that my research agenda is therefore over one hundred years old). Interestingly, it’s not necessary that the law change under those circumstances; rather, enforcement practices come, eventually, to reflect the standard of the public — what we usually now call norms. I’ve called those gaps between law and norms ‘parameters of acceptable deviance’ or PADs. Behavior within them is formally illegal but socially acceptable, and generally does trigger either a formal enforcement response or social sanctions. Behavior outside of them may be either formally legal or illegal. Behavior that is both formally illegal and socially unacceptable usually triggers a formal enforcement response; behavior that is formally legal but socially unacceptable usually triggers social sanctions.
To see this phenomenon in action, go for a drive. Chances are you’ll behave within a PAD by speeding, but not speeding too much. Let us say, up to 77 mph in a 65 mph zone. If you get a ticket for driving within a PAD, you’ll be upset. But if you see someone exceeding the PAD, you’ll hope s/he gets a pulled over. If you get stuck behind someone acting outside the PAD, but obeying the law by driving below the speed limit, you might apply social sanctions (not you, dear reader, but someone else might make rude gestures, for example).
The article I’m now finishing – errr, would be finishing, if I were not writing this instead – applies the PADs concept to property rights. It was a delight, therefore, to see this article in last week’s New York Times. It’s a fascinating story — regardless of how you interpret it — about the reaction of people in a small city in Russia to the privatization, and then near shuttering, of the factory that was the city’s lifeline.
When the factory employees, used to a communist economy, asked the regional government to replace the inept and perhaps corrupt new owner, they were told it couldn’t be done because “private property was sacred.” The owner ran the business into the ground. But when the owner stopped paying the employees’ wages, they still came to work. When management told them there was no more work and to go home, they still came. When the local utility cut off electricity and heat to the factory, they still came. Finally, at somewhat of a loss about what to do, the government took over ownership of the factory through a state-owned bank (although it insists it will be sold again to private owners) and put the employees to work.
Now, there are lots of ways to interpret this story. Here are a few:
(1) It demonstrates that the communist culture of worker entitlement and economic inefficiency still exists, and that Russia lacks the political will to overcome it;
(2) It suggests that crony capitalism is eroding (or has already eroded) any popular support for post-Soviet market reforms;
(3) It suggests that in Russia, the United States, and everywhere in between, regardless of ideology, some businesses are too important to be left to the judgment of the free market (i.e., are too big – or at least important — to fail)
There are many other possible interpretations, and I’d be curious to hear yours. But here’s the one that interests me, and that I think would interest Pound: people tend to live their lives with reference to, but not in obedience to, the law. People are not law-abiding; they are acceptable-deviance-abiding. Notice that the workers in this story didn’t strip the factory of whatever they could find – that behavior would have been unacceptably deviant. Instead, they behaved within parameters of socially acceptable deviance – insisting that they could enter private property to wait for their jobs to return. Both acts are inconsistent with the sacredness of private property rights; one is socially unacceptably deviant, the other is not. By simply acting within bounds of socially acceptable deviance with regard to private property rights, the people caused the state to realign itself, regardless of the strictures of formal law.
If you find it objectionable as a matter of principle, mind your speed on the drive home.