Legal Paternalism

Few people seem prepared to say that they are in favor of totalitarian ideologies like Communism or Fascism today.  Most people are typically in favor of “some controls”, or “some limitations on freedom”.  There can be different reasons why someone advocates a “middle of the road approach” when it comes to the choice between a purely free society and totalitarianism.  One reason that I have heard repeatedly in response to my advocacy of freedom in the economic and personal realms is that what I believe is “overly idealistic” and that it will not “work” because not everyone is as rational as I am.  In essence, the allegation is that a capitalistic, free society is impossible because there are people who need to be “protected from themselves”.
The first thing to note about this critique of capitalism is that it assumes that a proponent of capitalism is primarily concerned with the welfare of others, rather than his own rational self-interest.  If the proponent of capitalism is also an egoist, then his primary concern is his own welfare.  However, a genuine egoist can be concerned with the welfare of others to the extent that living in a free social environment promotes his own self-interest.  The more other people act in their own rational self-interests, the better it is for the rational egoist.  It means there are more people who work and produce, which increases opportunities for trade and the gaining of new knowledge.
It is also clear there are currently people who are not 100% rational in all situations, and the rational egoist has selfish reasons for wanting them to be more rational.  However, laws aimed at “protecting people from themselves” do not promote rational behavior by the people living under such laws.  In fact, such laws tend to discourage rational thinking and action in the general population, thereby creating a vicious cycle in which such laws discourage rational thought, thereby creating the impression that more laws are necessary.  The end result of this would have to be either: the original restrictions are discarded, or eventual totalitarianism.
What does it mean for a law to be aimed at “protecting people from themselves”?  As mentioned, some adults are not completely rational.  This means that they do not consistently recognize or act on what is in their self-interest.  There are people who continue to inject heroin despite the fact that it does not serve their long-term self-interest.  There are people who stay in abusive relationships.  There are people who purchase bogus cure-alls from “snake-oil salesmen”, even though they have no rational basis for believing that the product works.  There are people who go to palm-readers and fortunetellers, and make major life decisions based on the word of con artists.  All of these actions are typically going to be irrational.  Why are all of these actions considered “irrational”?
The previous examples all involve actions that do not serve a particular goal or purpose.  The heroin addict continues to use, despite the fact that his actions harm his health.  His action is not considered “rational” because it does not serve the end of good health.  The people who purchase bogus cure-alls from the snake-oil salesman want good health, but the means they have chosen do not serve that goal.  So, the money and time that they have spent are wasted.  The people who go to fortunetellers are wasting their money since no one can predict the future by means of some sort of mystic insight.  No such mystic insight exists.  The goal, good decisions about what course of action they should take, is not served by the means they have chosen.  They would be better served by observing the facts for themselves, deciding what their goals are and how best to achieve them in light of the facts, and then making a decision based on those evaluations.  Rationality, which is a proper exercise of the mind, involves evaluating the facts in order to determine how best to serve a particular goal or purpose.  It is in reference to a goal or purpose that certain actions are considered “rational”, and others are not.
            A high school student who wants to get into college is considered “rational” if he studies hard and goes to class.  A high school student who wants to go to college, but spends every night at parties, and never attends class would generally be considered, other things equal, “irrational”.  With enough examples of “rational” and “irrational” actions by people, it quickly becomes apparent that “rationality” is that which serves the end of promoting the actor’s life and wellbeing.  Actions are judged “rational” or “irrational” to the extent that they serve that ultimate objective.  Rationality is not primarily a “quality” that some people magically have while others don’t, but a choice to actively used one’s mind to serve certain purposes and achieve certain goals.  Rationality is a mental state that must be cultivated by focusing one’s mind, objectively appraising the facts, and thinking about how best to achieve a goal in light of the facts.
A few clarifications about rationality should be noted before going on.  “Rationality” is not the same thing as one’s degree or level of knowledge.  A person with a minimal education can be completely rational, if they use the knowledge that they have available to them to think about how best to achieve their long-term survival, and act on that knowledge.  To the extent that a rational person is ignorant about an important subject, he will attempt to gain the knowledge he needs to live successfully.  “Rationality” is also not the same thing as “intelligence”.  Intelligence is the speed or ease with which one is able to think, not whether one choses to think.  The fact that one is rational also does not guarantee long-term survival, no matter what.  Factors beyond one’s control can cause failure despite rationality.  Rationality is a necessary, but not a sufficient, condition of long-term success.  Most of the time, a rational person will succeed, but that doesn’t mean he can’t be randomly struck by lightning or a tornado and killed, despite his best efforts to avoid it.
It would also be virtually impossible to be totally irrational, since it would likely lead to instantaneous death.  People who are beyond a certain threshold of irrationality are typically referred to as “insane”, and are usually dependent on the charity of others, or the state, to be kept alive.  Some people are also irrational in some areas of their lives, but they are able to “compartmentalize” their irrationality, at least in the short term.  People who seek guidance from fortune tellers may have jobs where they generally work hard, and use their minds, and they only seek the advice of fortune tellers regarding their personal relationships.  In their work lives, they have a goal of career success, and they use means that tend to achieve that goal, but in their personal lives, they are dependent on the word of a mystic, and that dependence will not tend towards long-term success in that area of their lives.
It is also important to remember that when it comes to thinking, your mind is like a muscle.  The more you exercise it, the better you get at it.  There is probably a strong connection between rationality and intelligence for this reason.  The more you think logically and rationally, the more you develop a habit of doing so.  Similarly, the more you choose to be mentally lazy, or are otherwise discouraged from thinking, the more difficult it is to exercise your thinking faculties in the future.
In philosophy of law, the notion of protecting people from themselves is commonly referred to as “legal paternalism”.  Most actual statutes have numerous, possibly conflicting, justifications.  Legal paternalism may not be the only rationale for a particular law, but one category typically justified on the grounds of legal paternalism are “consumer protection” statutes.  These statutes will restrict freedom of contract in some manner on the grounds that the consumer is too irrational to be left free to decide for himself.  In law, a “contract” is an agreement between two or more people to exchange a value for another value.  The values involved in a contract are generally either material goods or some sort of service used in the production of goods.  There is usually a time element involved in a contract, where one party may provide a good or service prior to the other party providing what they have promised in exchange.  Consumer protection laws include laws that restrict the sale of medical drugs that have not been approved by a government organization as safe or effective.  In the United States, the government organization that approves drugs is the Food and Drug Administration.
The consumption of most medical drugs involves a certain degree of risk.  Even a drug that is approved by the FDA may have unknown side effects for certain people.  Certain drugs are also safe for some people, but are unsafe when taken by other people, in other situations.  In general, the concept of “safety” is nothing more than an acceptable degree of risk in relation to the rewards and expenses involved, because every action one takes involves a certain degree of risk.  Legal paternalism in the area of drugs is the attitude that some people are not rational enough to make a decision about the risks of a particular drug.  If left free to do so, some people might take drugs that would kill or seriously injure them, or at least spend money on drugs that any reasonable person would know to be ineffective.  Since all drugs involve risk, proponents of legal paternalism are saying some people would refuse to weigh the risks and benefits of a particular drug, and make a rational decision about whether to take it.  The Drug Enforcement Agency also occasionally justifies its activities on the grounds of legal paternalism: “The DEA represents the unspoken interests of tens of thousands of victims harmed or killed each year by prescription drug abuse.” (Letter to the Editor, Wall Street Journal, April 1, 2012, by Peter Bensinger, who served as administrator of the U.S. Drug Enforcement Administration from 1976-1981, and Robert L. DuPont, M.D., who was the first director of the National Institute on Drug Abuse from 1973-1978)
Most advocates of legal paternalism in the area of drugs will combine their argument that “most people are too irrational” with the argument that “most people are too ignorant”.  They fail to make a distinction between irrationality on the one hand, and a mere lack of knowledge on the other.  In other words, proponents of drug-approval laws might also say that most people lack the knowledge to make a decision on which drugs to take.  It is true that most people do not lack the knowledge to know which drugs to take when they have a medical condition.  Most medical decisions are made with the assistance of expert legal advice, such as a doctor.  However, if there truly is a lack of knowledge on the part of the general public about this issue, then private certification companies could certify certain drugs as safe and effective.  People with insufficient knowledge could then base their decision on which drugs to take on whether a certification company with a good reputation had approved the drug.  At its best, all the FDA does is certify that certain drugs are safe and effective.  The staff at the FDA are, in the best case, appointed by members of Congress who have no medical backgrounds themselves.   The members of Congress also rely on the medical reputation of FDA personnel when deciding to appoint them.  Since members of Congress are “appointed” by the voting public, the FDA represents, in the best case, nothing more than an organization that most people in the voting population regard as reputable when it comes to designating certain drugs as safe and effective.  (I say “in the best case” because most political appointments usually involve “political pull” and personal friendships, rather than which appointee is the best person for the job.)  Since the FDA is, at best, based on nothing more than reputation in the medical community, there is no reason why private companies could not perform this certification function to solve the problem of lack of knowledge by the general public.
This leaves advocates of legal paternalism with the “people are irrational” argument, since the “people are ignorant” argument can be solved more effectively through a voluntary free market system.  However, governmental force reduces the incentive to think about which drugs consumers should take, since their choices have been reduced to the government-approved drugs.  The benefit of thinking and learning about whether one should take drugs that haven’t been approved by the FDA is greatly reduced, since even if one comes to the conclusion that such drugs are best for a particular situation, none of us are free to obtain and use those drugs.  As was mentioned, whether a particular drug is right for you turns on your particular circumstances, and certain people may be more willing to take a greater risk, particularly if they have nothing to loose.  This has been the case for people with certain types of serious cancer who sued the FDA for refusing to allow them take experimental chemotherapy drugs, even though they had a high probability of dying from cancer anyway.  The appeals court in that case said that such people had no right to take the drugs, even though the drugs might save their lives. (“Court Rejects the Right to Use Drugs Being Tested”, New York Times, August 8, 2007)  Part of thinking involves making decisions about what level of risk you are prepared to take in order to obtain a goal.  The ultimate goal to be obtained by thinking is the maintenance of one’s life.  Restrictions on people’s freedom leaves them less able to obtain that goal, and thereby emasculates the need for thought.
It is probably true that if left free to do so, there would be some people who would take drugs that are harmful to their health, or who would spend money on drugs that have no benefit.  This happens today, even with prohibition.  People have free will, so it is possible that some people will choose not to use their minds on this particular topic, and will suffer the consequences.  It is entirely possible that some people could even loose their lives as a result.  But, restricting the freedom of the population as a whole in this area just to protect a small number of people from themselves has consequences too.  It destroys the need for thought in this area, thereby reducing the incentives in favor of thinking.  This in turn means that everyone will be less incentivized to think, and therefore more likely to depend on the state to make choices for them.  The few people who choose to be irrational regarding what drugs they take harm primarily themselves.  Restricting freedom in this area to protect these people sacrifices the people who do choose to think.
Another area of legal paternalism in the United States, and the rest of the world, is in the area of purchasing stock in corporations on secondary exchange markets like the New York Stock Exchange.  Prior to stock being sold on such exchanges, they must be approved by government agencies like the Securities and Exchange Commission.  Many of the principles discussed above regarding the FDA apply here too.  In both the case of consuming medical drugs and purchasing securities, there is a risk associated with it.  The consumer must educate himself regarding the risks and benefits, and then decide whether, for his particular circumstances, the benefits outweigh the risks.
Just as with other statutes, legal paternalism isn’t the only justification for securities and exchange laws.  Just as some will argue that they are primarily trying to project the mostly rational public from dishonest drug companies, so too will some people argue that the securities and exchange laws are aimed at protecting rational people from fraudsters.  This is not an argument based in legal paternalism, but involves attempting to protect rational people from the bad actions of others.  However, fraud was already illegal long before the existence of state and federal securities laws.  A fraud involves a lie to exchange, money, goods or services with another, when the goods or services provided to the victim are not as the fraudster claimed.  The fraudster holds the other person’s valuables and refuses to give them back, or he holds the other person’s valuables sufficiently long enough to prevent them from using them for other purposes.  An example of fraud in the area of securities and exchange would be if a person sells stock in a corporation that he claims to be solvent and profitable when he knows for a fact that the corporation is actually bankrupt.  A “pump and dump” scheme is likely fraudulent because the seller of the stock is falsely claiming that the company is more profitable than it actually is, or that it will become more profitable than the facts would suggest –even taking into account the possibility of risk.   All fraud should be illegal and that is all the “consumer protection” that is needed to protect rational people.
Just because fraud is prevented under capitalism does not mean that people who choose to invest will never loose their money.  All investing, by its very nature, is risky.  Much, if not all, of the profit from investing is associated with the fact that you are deferring consumption in favor of the production of future goods or services.  It is possible, due to factors beyond anyone’s control or knowledge at the time, that an investment will not pay off, and the deferred consumption will be wasted.  If someone invests in a farm, it is possible that there will be a massive hurricane that destroys the crops.  If someone invests in a company with a new product, it is possible that consumers will prefer some other company’s product better, and that the company will not succeed.  Risk is not just inherent in investing.  Risk is a fact of life, and it is impossible to live entirely risk-free.  So long as the seller of a stock does not make claims about the stock that he knows to be false, or actively conceal the facts from a buyer, the legal principle of caveat emptor (“buyer beware”) should apply.
By adopting the legal principle of caveat emptor, people are encouraged to think carefully about the risks associated with investing, and not to invest money that they can’t afford to risk.  Caveat emptor encourages thought in the area of investing and money.  If the government restricts certain types of investments as “too risky for any rational person to make”, then it is discouraging people from thinking about what investments they should make (if any).  It discourages people from learning basic economics and business principles, and from thinking about which investments are sound.  It also discourages people from thinking about how much risk makes sense for them, given their particular situation.  Furthermore, it discourages those who do want to think extensively about investing, and are willing to take extra risks in exchange for greater potential rewards, from doing so.
This principle -that legal paternalism in the realm of economics and trade tends to discourage thought, and thereby create the apparent need for more legal paternalism- has applicability outside of areas besides economics and trade.  The proponents of legal restrictions on “pornography” and “obscenity” often couch their arguments in terms of legal paternalism.  This justification for restrictions on “obscenity” goes back at least a hundred years.  In 1868, a British court promulgated what has become known as the “Hicklin rule”:
I think the test of obscenity is this, whether the tendency of the matter charged as obscenity is to deprave and corrupt those whose minds are open to such immoral influences, and into whose hands a publication of this sort may fall. Now, with regard to this work, it is quite certain that it would suggest to the minds of the young of either sex, or even to persons of more advanced years, thoughts of a most impure and libidinous character...” (Regina v. Hicklin, L.R. 3 Q.B. 360 (1868). Court of the Queen’s Bench.)
In that case, the court noted that even adults (“…persons of more advanced years…”) could have their minds “deprived and corrupted” by certain types of material.  (In the Hicklin case, it was a restriction on certain material meant to mock the Catholic Church.)  This is essentially an argument based in legal paternalism, since the aim of the restriction is not to protect “society” or “others”, but to protect the people who would otherwise choose to read such material.
In 20th Century America, legal paternalism has also been used by the courts as one of the justifications for legal restrictions against certain types of “obscenity”.  In 1973, the United States Supreme Court decided Paris Adult Theater I v. Slaton.  The case involved the State of Georgia prohibiting two “adult” movie theaters  from showing films that depicted sexual conduct.  While legal paternalism was not the only reason the Court upheld the prohibition, the opinion in that case was at least partially based in the notion of legal paternalism:
If we accept the unprovable assumption that a complete education requires the reading of certain books…and the well nigh universal belief that good books, plays, and art lift the spirit, improve the mind, enrich the human personality, and develop character, can we then say that a state legislature may not act on the corollary assumption that commerce in obscene books, or public exhibitions focused on obscene conduct, have a tendency to exert a corrupting and debasing impact leading to antisocial behavior?” (Paris Adult Theater I v. Slaton, 413 U.S. 49 (1973).)
In other words, the Court said that since it is widely assumed that encouraging the reading of Shakespeare and other classic works of literature makes one a better person, then it is just as easy to believe that viewing films with strong sexual content would lead a person’s mind to be, in some sense, damaged or “debased” by the experience.  The Court went on to note that just as the states have “blue sky laws”, which prevent the “gullible” from making bad investments, “for their own good”, so too can the states have laws that prohibit obscenity in order to protect the “weak” and the “gullible”:
Most exercises of individual free choice—those in politics, religion, and expression of ideas—are explicitly protected by the Constitution. Totally unlimited play for free will, however, is not allowed in our or any other society. We have just noted, for example, that neither the First Amendment nor ‘free will’ precludes States from having ‘blue sky’ laws to regulate what sellers of securities may write or publish about their wares…Such laws are to protect the weak, the uninformed, the unsuspecting, and the gullible from the exercise of their own volition.” (Id.)
In other words, the Court said that laws prohibiting obscenity are necessary, at least in part, to “protect people from themselves”, because such works can “debase” or “corrupt” their minds.  Both the Hicklin case and Paris Adult Theater share a common attitude.  It is the idea that certain material, when read or viewed, will have a tendency to cause some sort of mental or psychological injury to the viewer.  Although some people seem to have sufficient “will power” to overcome the “corrupting influence” of that material, other people do not seem to have the “will power”, and it will damage their minds.
There does seem to be some evidence that certain types of books, movies, or magazines can have a negative impact on some people’s minds and wellbeing.  Some people do seem to become “desensitized” by viewing excessive amounts hardcore pornography.  They become incapable of having a normal sex life.  There are articles that report on some men having become “addicted to pornography” to such an extent that they became temporarily impotent with actual women.  “Lots of guys, 20s or so, can’t get it up anymore with a real girl, and they all relate having a serious porn/masturbation habit.” ( Psychology Today, “Porn-Induced Sexual Dysfunction Is a Growing Problem” Published on July 11, 2011 by Marnia Robinson  This suggests that viewing excessive amounts of certain sexually explicit material may cause psychological problems, for some people, in some specific contexts.  (The article goes on to say that the “cure” is to abstain from viewing pornography for a while, and a normal sex drive will eventually return, so any damage done is probably not permanent.)  However, there are also numerous people who may occasionally read a “Playboy” magazine (and not just the articles), or even go to a topless bar for a bachelor party, and they do not seem to suffer any long-term consequences.  They can enjoy the experience occasionally, without loosing their sexual desire for their girlfriends or wives.  Most people would also be unlikely to deny that a “steamy” love scene in a mainstream R-rated movie or novel can be great, and that if the scene were removed, the plot would be weakened.
The fact that there are some movies that have gratuitous sex or violence and therefore are considered “obscene”, while other works of art are considered to have “legitimate adult material” in them points to another common question that arises when the government attempts to ban “obscene” matter: What is and isn’t “obscene”?  Even some of the proponents of banning “obscene” matter seem to recognize that some sexual content in art is legitimate and should not be banned:
Pornography is not objectionable simply because it arouses sexual desire or lust or prurience in the mind of the reader or spectator; that is a silly Victorian notion.  A great many nonpornographic works –including some parts of the Bible –excite sexual desire very successfully.  What is distinctive about pornography is that, in the words of D.H. Lawrence, it attempts to ‘do dirt on [sex]…[It is an] insult to a vital human relationship.’” (Morality, Harm, and the Law, edited by Gerald Dworkin, Westview Press, Inc. 1994, Chapter 4 Liberalism: Objections and Defenses, “Pornography, Obscenity, and the Case for Censorship”, by Irving Kristol, originally appearing in New York Times Magazine, March 28, 1971, pp. 246-247)
Rather, obscenity should be censored because it:
“…differs from erotic art in that its whole purpose is to treat human beings obscenely, to deprive human beings of their specifically human dimension.  That is what obscenity is all about….To quote Susan Sontag: ‘What pornographic literature does is precisely to drive a wedge between one’s existence as a full human being and one’s existence as a sexual being –while in ordinary life a healthy person is one who prevents such a gap from opening up.’” (Id.)
“Obscene material” in the United States is generally considered to include graphic, detailed depictions of sexual intercourse.  (“Hardcore pornography”)  But, it is very difficult, even for a rational person, to determine when the sex scene in a work of art is “legitimate” and when it is not.  It takes great mental effort to make such a judgment regarding a work of art, and reasonable minds can easily disagree on such a complex, fact-specific topic.  One Supreme Court Justice went so far as to say that he couldn’t define what was and wasn’t “hard core pornography”, but he knew it when he saw it.  (Concurrence of Justice Stewart, Jacobellis v. Ohio, 378 U.S. 184 (1964)).  It would appear that one would first need to understand something about why art is important, and what “art” consists of, which is no small task in and of itself.  In literature and movies, it would then appear that one must weigh the scene in relation to the overall plot, the characterization, and the theme of the work before determining if the sex, or the violence, is gratuitous or attempts to “do dirt on” sex.  The point is not just that there is no general consensus on what is “obscene”, and therefore the government shouldn’t get involved -although that is probably a correct observation.  The point is that it takes mental effort and thinking to make this determination, and it is not easy for even a rational person to make.  It requires the exercise of one’s rational faculties to judge a work of art as “good” or “bad”.  By leaving people free to decide for themselves what content in art is appropriate, they are provided with the opportunity to exercise their rational judgment and discrimination in the realm of art.  Censorship of “obscenity”, assuming that a universally accepted definition of what that means could be determined, would deprive people of the opportunity to exercise their minds.  Since all thought involves the mental formation and manipulation of ideas developed from observations and inferences derived from reality, censorship in the realm of ideas probably destroys thinking in a society faster than any economic regulation ever could.  Economic regulation may be the road to serfdom, but censorship is the expressway to totalitarianism.
Eventually, the restrictions on freedom that made thinking irrelevant must be lifted, or more will follow.  Will the censorship of “just a few hardcore porno movies”, or “just a few economic regulations” lead to immediate totalitarianism?  No, but it discourages thinking in the realm of ideas, and that makes the people a little less capable of thinking for themselves, which creates the apparent need for more restrictions on the freedom of a growing number of individuals who are increasingly incapable of thinking for themselves and who seem to constantly make poor choices.  For some people, especially those who have already become accustomed to letting the government do most of their thinking for them, the prospect of more freedom will seem daunting and frightening at first.  There are now several generations of people who are dependent on the state, but the alternative to the dawn of complete freedom is the eventual long night of totalitarianism.