A Twitter friend facetiously raised the question today of whether the Constitution is America’s “Terms of Service,” following up with “[Expletive]. I knew I should have read the fine print instead of quick scrolling down to the bottom and hitting ‘Agree.'”
Soon after, I read an account of a lecture in which Doc Searles referred to the rules govering most online experiences — EULA agreements, placement of cookies, and other one-sided relationships — as “contracts of adhesion.” In legal terminology, a contract of adhesion is any contract drafted entirely by one party in an unequal power relationship, which the other party is “free” to take or leave — but in practice really can’t afford to leave. Pretty much any “standard contract” or boilerplate used by an entire industry is a contract of adhesion.
Our relations with the powerful institutions that control our lives are largely governed by contracts of adhesion. Instead of individually negotiated contracts, whose terms we play a role in defining, we’re faced — in Searles’s words — with “contracts we never made,” that “one side built and the other side was required to accept.”
This observation applies, obviously, to the “Social Contract” so often cited versus libertarianism. By continuing to reside on the state’s territory, governed by laws created pursuant to a “contract” already in being between the people living here — so the argument goes — we consent to the state’s authority. This is an exercise in question-begging, assuming what is to be proved (the state’s right to issue such an ultimatum in the first place). If I walked into your living room and said “by continuing to reside here, you agree to comply with my rules,” you’d notice that problematic unstated premise right off the bat.
But it also applies to our relations with the large “private” institutions that govern our daily lives. As Roderick Long points out (“How Inequality Shapes Our Lives,” Austro-Athenian Empire, September 17, 2010) with regard to a rental agreement:
“Did you write it? Of course not. Did you and your landlord write it together? Again, of course not. It was written by your landlord (or by your landlord’s lawyer), and is filled with far more stipulations of your obligations to her than of her obligations to you. It may even contain such ominously sweeping language as ‘lessee agrees to abide by all such additional instructions and regulations as the lessor may from time to time provide’ (which, if taken literally, would be not far shy of a slavery contract). If you’re late in paying your rent, can the landlord assess a punitive fee? You betcha. By contrast, if she’s late in fixing the toilet, can you withhold a portion of the rent? Just try it.”
The same is true of workplace relations: “[I]f you try inventing new obligations for [your employer] as she does for you, I predict you will be, shall we say, disappointed.” And your utility providers can much more easily dock you for late payment than you can claim a refund for service interruption. This principle permeates every part of our lives governed by large institutions. “They’re cases in which some people are systematically empowered to dictate the terms on which other people live, work, and trade.”
The right wing of the free market movement sees nothing problematic in this. It takes such contracts at face value, treating them as genuine examples of the free, uncoerced contracts between equals so dear to libertarianism. That every aspect of our lives is dominated by giant, powerful, hierarchical institutions is just how things turned out in the “free market;” such institutions are more efficient, see?
Those of us on the left who advocate freed markets beg to differ. The power of these giant authoritarian institutions, whether nominally “private” or not, didn’t “just happen.” It results from a rigged game, an unholy corporatist alliance between big business and the state dating back 150 years or more. Our society and economy came to be dominated by an interlocking directorate of government and corporate oligarchies through the deliberate use of power.
As libertarian blogger “thoreau” says of homeowners associations at Unqualified Offerings (“wHOA,” June 19, 2012), “We certainly don’t need libertarianism if we’re just looking for a way to justify the fact that somebody is telling you what sort of flowers to plant in your yard.”
The whole point of libertarianism, at least a libertarianism that appeals to actual human beings who want more liberty in their lives, is to increase the autonomy of individuals against arbitrary rules made by institutions of all kinds. As anarchist artist Shane Thayer says, “I don’t want a society that ‘liberates’ itself by replacing the flag on the police uniform with a company logo.”
We left-wing market anarchists want to level out these unequal power relationships, dissolving concentrations of power both public and nominally “private,” so that freedom of contract becomes reality rather than mockery and smokescreen. We see the state, in alliance with privileged classes and plutocratic interests, as the root cause of these asymmetries. The state’s subsidies, artificial property rights and regulatory cartels midwifed the corporate economy in the first place. It has since grown into an entire interlocking eco-system in which even nominally “private” and “voluntary” parts are fundamentally coercive.
By striking at the root of this power — coercion — we anarchists want to destroy the state-corporate complex.
Translations for this article:
- Spanish, Contratos Unilaterales
- Portuguese, Contratos Unilaterais
Citations to this article:
- Kevin Carson, One-Sided Contracts, Deming, New Mexico Headlight, 06/24/12
Hmm. Interesting points to consider. Thanks for the article.
You’ll need some type of enforcement system to remedy the imbalance of power, even in a stateless society. That system of enforcement is ……?
Thanks for the link, Kevin. I wouldn't mind a system in which one-sided contracts were either not enforced or at least there were limits on how far courts would go in enforcing these contracts.
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The lack of a mechanism for enforcing the imbalance of power.
Without the state to enforce titles on vacant land, leaving it free for homesteading, what does it benefit someone to sign a one-sided contract with a landlord?
Without the state to put up barriers to freely trading in the market, what does it benefit one to sign a one-sided contract with an employer? What is there to prevent the workers from seizing a business from an oppressive absentee-owner, whose business was only kept afloat by state violence?
Kevin, I don't disagree that much of the "unequal bargaining power" that some institutions have, is because of their extra-market power due to state interventions now and historically. However the basic idea of adhesion contracts is not libertarian, I think; in a genuinely free market, even if there is "unequal bargaining power," even if the bigger party gives you "take it or leave it" deal, then that's still legitimate.
I would say, however, this doesn't mean that all click-wrap, shrink-wrap, and fine print parts of the written contract are valid, even in a free market. People are too used to conflating the written document with "the agreement." But it is just evidence of what was agreed to (agreements can be oral, for example). It can be rebutted. If I click "yes" and never read the fine print, and the seller knows I didn't, and has buried in there some ridiculous clause, was there really a meeting of the minds? I say no; a general presumption of contracting is "good faith" and reasonableness. I go into this a bit here: http://archive.mises.org/9923/the-libertarian-vie…
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Oh, I"d also quibble with this: "The whole point of libertarianism, at least a libertarianism that appeals to actual human beings who want more liberty in their lives, is to increase the autonomy of individuals against arbitrary rules made by institutions of all kinds." Libertarianism's point is to increase the ability of individuals to live and act without having their bodies or property interfered with by physical violence. but then I'm less of a lefty and thicker than some.
My recent post Tucker on Spooner’s One Flaw
"… however, this doesn't mean that all click-wrap, shrink-wrap, and fine print parts of the written contract are valid, even in a free market." – in fact, there are plenty of clauses in written contracts that don't past muster if challenged, even now.
For example, any clause that implies an "agreement to agree" to post-contract changes of terms, is not a valid term in a contract: there is abundant case-law in this regard. (YMMV – obviously in the US this would be a dead letter since the US system sees peons as revenue sources, not people whose rights are the paramount object of the system: it is a money funnel channelling productivity upwards in ways that the Bourbons and Borgias would think astounding).
In most western systems of jurisprudence, there are also limitation on the extent to which contractual terms will be enforced in the event that one or other of the parties should have reasonably expected that their counterparty was signing something that they could not possibly understand ('conscionability' of pre-contract conduct). This is of particular relevance given that 40% of adults in most Western societies are unable to properly comprehend a set of pill-bottle instructions (see any set of ALSS/LISS results to confirm this: more than a third of adults are functionally illiterate): the notion that they could read and properly understand an EULA is as absurd as the idea that a 15th century peasant understood the Vulgate (or the bits that the costumed peadophile read out to them).
Don't get me wrong: I am an absolute opponent of the government-mandated monopoly of the legal and judicial professions (and its forced unionisation – although they call it the "Law Institute" or the "Bar Association") . I don't consider any of the nonsense exuded by politicians as binding on me (I never consented), and no 16-th century costume drama set-piece will convince me otherwise. That said, we need to recognise when the (flawed, tilted) system actually does contain mechanisms that provide relief.
Thing is, almost anyone who CAN read past a 7th grade level (i.e., the top sixth – again, see any of the ALSS reports) will realise that if you tried to get any such 'contract' revoked due to invalid clauses, or tried to appeal to notions of unconscionable conduct, you would financially ruined by your opponent before it even got anywhere near a 'court'.
The classic canard – "If .gov doesn't have a monopoly on dispute resolution and contract enforcement, these things will not exist".
Stefan Molyneux went into some detail about alternatives to government monopoly of this function in this post on Lew Rockwell's site (if this works, it's the link… http://bit.ly/Mz1HvX – TL;DR search for "Dispute Resolution").
Others (Rothbard, for example, in "Society Without a State" -> http://mises.org/journals/lf/1975/1975_01.pdf SWaS starts on page 3]) have canvassed this as well.
It's not hard to imagineer a completely competitive, voluntary-compliance system of contract enforcement. Mr Molyneux refers to these as 'Dispute Resolution Organisations' – I was certain there was a YouTube video about this on his channel, but couldn't find one (that said, if I can't find something in ten seconds nowadays, I tend to give up and wait for *it* to come to *me*).
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Wonderful piece, Kevin. It’s also an illustration of my basic answer to right-“libertarians”: “You claim to love liberty, but you don’t even understand what it means.” Any notion of liberty worth caring about must include freedom from *all* kinds of constraint rooted in the arbitrary exercise of power, not just those that run through a government. This is a good companion piece to your equally excellent “The subsidy of history” ==> http://dedicto.com/wordpress1/bib/#carson-2008-th… which shows how difficult it is, in any case, to tease apart governmental power from other kinds of coercion based ultimately in extreme and brutal violence. From the point of view of the thugs that run existing societies, if government didn’t already exist, it would have to be invented.
The link in the previous comment was truncated. This version with a shortened URL should work:
http://is.gd/WUc53l
I think the point that Steven mentioned about there not being an understanding of the terms of the contract (and the side proffering the contract having knowledge of this) is what use to be known as constructive fraud.
That would make it a crime to take a financial benefit arising from the execution of the fraud.
It's shameful, and the shame is on all of us who permit these frauds every day. But is it coercion if the person aggrieved is willfully negligent (of his rights)?
The incentive to follow through on any "contracts" should be your reputation and the reciprocity of others holding up their agreements with you. If freedom of both entry and exit of relationships is respected, then the binding part of contracts loses all power. Sex is a good example of this: if she says "no", it doesn't matter how much she said "yes" before.
Pointing to the coercion behind the contracts is all well and good. But a binding contract, once enforced on a no-longer willing party, is a coercive act in itself. Forget quibbling about "meeting of the minds" or "misunderstand the terms", binding contracts themselves are unlibertarian.
You have it exactly backward.
If a contract that we have both voluntarily entered entered into specifies that I shall give you X, and you shall give me Y, then if I give you X and you do not give me Y, it is you who are acting coercively. You are keeping my property against my will, or, in other words, stealing it.
I agree, Knapp. But is it X, or Y, that he has stolen from you? I say it's Y, if Y exists and if he owns it. Then he has agreed to give it to you, so his keeping it is detaining your property. But if Y is supposed to be good apples and it's really a bunch of rotten apples, then there is no Y, there is fake-Y. So in this case, he is committing fraud and his keeping of your X is the theft.
I think Masebrock's error is in viewing contracts as binding promises, which he recoils against on some kind of inalienability grounds. But contracts should not be viewed as binding promises. Rather, they should be viewed as transfers of title to alienable property. If you own a thing that you acquired, you can give it, or agree to give it, to someone else based on certain pre-specified conditions. This is based on Rothbard's and Evers's title-transfer theory of contract.
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Is your view that peoples' property rights in their own bodies are inalienable, but their property rights in things that they homestead or acquire title to in a trade are inalienable?
I've read your essay "What Libertarianism Is" ( http://mises.org/daily/3660 ) and think that it is a great description of libertarianism, although it doesn't mention anything about alienable vs inalienable rights, a subject which I haven't really thought much about.
However, in the footnotes of the essay I found your essay "A Libertarian Theory of Contract: Title Transfer, Binding Promises, and Inalienability" ( http://mises.org/journals/jls/17_2/17_2_2.pdf ), which will probably answer my question about your views, but that I am yet to read.
Also, if I recall correctly I believe that your views is that contractual slavery is illegitimate. Walter Block is one libertarian who disagrees with you. I have yet to think about this subject in any detail myself, but again am interested in learning more. Is there an essay or article that you have written on this subject that you could recommend to me?
Thanks for the discussions, everyone. There are a lot of people like me who learn a lot just by reading them.
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Propertarianism is not libertarianism.
Thomas L. Knapp and Stephan Kinsella: a “contract voluntarily entered into” is an ideal to be attained in the future, and approximated as closely as possible (which, in general, is not very closely at all) in the present. It is not a present reality that can be taken for granted. The present distribution of property (both private and public) reflects past coercion based on extreme violence and systematic fraud, both private and public (that’s the point of citing Kevin Carson’s “The subsidy of history” ==> http://is.gd/WUc53l , an article of fundamental importance), and exerts a pervasive influence over present-day contract-making behavior, amounting to a varying degree of duress. When someone asked Gandhi his opinion of Western civilization, he is said to have answered that it would be a good idea. I would say the same about entering into entirely voluntary contracts. It would be a good idea, but it will have to await a future in which people are entirely free. None are today; even plutocrats are constrained by their need to maintain the system that defends their wealth. The best we can do today is to attempt to approximate voluntary contracting. And that goal is hindered, not helped, by the pretense that our present-day contracts are entirely free.
The acceptance of the present-day distribution of property as even partially morally valid ought to be given another name, such as “propertarianism”. It should not be confused with libertarianism, as it usually is today.
Masebrock: I also agree that, for multiple reasons, it is not a good idea to treat the moral authority of contracts as absolute in any case. The duress and coercion that goes into creating contracts in the first place is only one of these reasons. John Badcock Jr. makes a provocative argument, at length, to that effect in “Slaves to duty” (1906) ===> http://is.gd/Z2XBIP While I don’t necessarily agree with everything Badcock says there, it’s certainly worth considering.
So you want "natural inequality" because equality can't exist? There's after all a simple contract – take the job or keep searching, rent the apartment or keep looking, follow the rules of the gated community or get out, etc. Such contracts certainly feel one-sided yet don't require state enforcement.
Oh really? Think of what crime enforcement entails and whether private companies could do the same:
* barge into the suspect's home and arrest him (nope).
* detain that person until the trial (nope).
* have the crime scene left untouched (nope except for the victims' private residence).
* subpeona people (nope)
* force people to tell the truth (nope)
* force people into being in a jury and getting a flat rate of pay (nope)
* forbid the accused and suspects to not leave the local area (nope).
* force the guity to pay restittution or except punishment (nope).
And so forth.
Yes, they do. They require the state to create an atmosphere in which signing such a contract would appear to be the only viable option; by artificially constraining your choices.
An anarchist has to accept the imbalance of power.
Clark wrote:-
In a world without a material state presence but with powerful magnates (as with the literal robber barons in the Middle Ages) and/or raiders (as in the Dark Ages), it is quite possible to be worth seeking real protection against those even worse, even where the arrangements are quite one sided. We can see something a little like this that was documented, but with a little state involvement, in 17th and 18th century Denmark (google Molesworth on Denmark). There, the state was absolutist in theory, but in practice it had to work through magistrates drawn from local magnates in rural areas. Those magistrates had to select a few conscripts for long terms; naturally, anyone who took an unfavourable tenancy was less likely to be taken. The point to notice was that no part of the state other than the magnates themselves ever did anything by way of enforcement in those regions.
Thomas L. Knapp wrote, seeking to refute Masebrock:-
No, you have it exactly backward; that is just precisely the statist formulation and interpretation, e.g. that there is no contract without a consideration. Masebrock, on the other hand, is presenting just precisely the feudal understanding: that a promise is binding regardless, and that the arrangement was an exchange of promises. Under this, if you gave me X and I did not give you Y after all you may follow up my bad faith but both X and Y are my property, quite distinctly from that; taking either is being an “Indian giver” (this is even stronger than Stephan Kinsella’s legal theory of it). Of course, because of this very difficulty, real arrangements generally also had clauses conferring enforcement rights and get outs, e.g. saying something like “saving my duty to the King, I shall be your liege man from this day forth until you do not nourish me” (but faulty enforcement rights made it not unknown for creditors to flee debtors so they would be unable to pay off their debts on time and so forfeit their sureties). But one of Alfred Duggan’s early historical novels, “Knight with Armour” (1950), describes the sinking feeling a crusader had when he realised he had not been careful enough in swearing allegiance to the Duke of Normandy, even though his father had earlier advised him about the care needed in such matters.
Plenty of legal systems have either managed to do those things or functioned well without them. See, e.g., Bruce Benson's _Enterprise of Law_.
You seem to have a very tilted view of the merits of current government-monopoly 'justice' and 'law' enforcement systems.
Let's do another checklist: would a non-monopoly system be able to
(1) seize property and make the victim pay to get it back, even once the victim was proved innocent? (nope)
(2) imprison people for, inter alia, making cigarettes or cookies whose ingredient included a plant that the political class didn't like? (nope)
(3) force people into a jury and not pay them a market rate for their time? Nope (I liked that one of yours, you see – just not the way you did)
(4) exculpate its own goons when they
(a) kill an innocent person's innocent dog;
(b) lay waste to an innocent person's house and belongings in a 'wrong door' no knock' raid… searching for some prohibited plant;
(c) shoot the wrong man in the back of the head seven times;
(d) handcuff misbehaving children in grade school?
(Nope, nope, nope and nope).
But lastly and most importantly: would Waco or Ruby Ridge have occurred if we had competing (and competent) rights-enforcement agencies? Not on your life, buddy – because nobody at Waco or Ruby Ridge was infringing on anybody else's rights, except the cowardly vermin from .gov: only government (and those who leech off it, like Xe) can furnish employment for shitbag scum like Lon Horiuchi – the baby-killing 'sniper' who should be enucleated and have his right hand pulped (as should all snipers – they're cowards).
As I said in 2008 (updating something Diderot is said to have written in 1738): man will be free once the last politician is bludgeoned to death with the severed arm of the last police sniper.
[Diderot's version was "Man will never be free until the last king is strangled with the entrails of the last priest"]
Only .gov does wide-scale, industrial strength, mass-killing war: the kind that your .gov is perpetrating on its brown-child-killing sprees in Afghanistan and Iraq (and by coward-drone in Yemen, Pakistan and elsewhere).