The relationship between public goods and sovereignty
May 1, 2011

The relationship between public goods and sovereignty

As our world modernizes, the relationships of self determination and sovereignty flex and change. Technological and sociological changes have made the provision of a wide variety of public goods possible at much larger scales. There is a trade off, however, between decreasing self determination and the benefits of increasingly large scale provision of public goods.

The provision of a public good that has dominated so much of our history is that of security. In some sense it is the ultimate and most important public good. The coalescing in Europe to major nation-states, for instance, represents the simple fact that the ability to effectively provide security (and indeed to go on to conquest others) scales with size. In our current ordering as countries being the principle unit of sovereignty, the existence of inter-country organizations has been led by security alliances like NATO and the UN which trade sovereignty  of individuals countries for security.  The IMF, World Bank, WTO, WHO and all the other non-security international institutions make a similar trade off of sovereignty in exchange for benefits of some other public good but all of these are secondary to the core military alliances and international security order that has shaped the world since WW2. Just as a country is able to use economies of scale to provide for the public good of security more effectively than localized warlords, so to has inter-country military alliances provided for a large scale increase in the ability to provide security. Today, for instance, war between major European countries is all but conceivable after centuries of conflict.

The ability to provide security is the fundamental defining characteristic of sovereignty. A police force and a military force are two of the most basic aspects of a state and the first to be created by any nation building (read: state building) enterprise. The only two countries without a standing army are Iceland, whose isolated location means it has no natural threats, and Costa Rica which has experienced considerable stability and no subsequent civil wars in a region beset with conflicts - although both retain police and other armed services. There is a legitimate question as to whether the proposed peace deals between Israel and Palestine would leave Palestine as a "sovereign state" given the restrictions on it being able to provide for its own security and the typical military functions that in some sense define what a modern state is. In many of the very insecure countries of the bottom billion, the provision of scale is done on a small geographic scale between small warlords or small countries. While there are many difficulties and reservations with this approach, there is much hope for larger scale provisions of security such as the African Union which can aim to use the economies of scale to provide for a more secure Africa.

Most of the public goods that are widely accepted today like the provision of a rule of law, education, health care, democratic governance, globalization in trade, security, and the like have all been made increasingly possible because of technological change. There simply wasn't the technological possibility to federally regulate genetically modified foods or for the WHO to vaccinate an entire world against certain diseases a couple hundred years ago. In a globalized, interconnected and technological world it is possible for federal and international governance bodies to actually perform genuine actions in the provision of beneficial goods to society. The mere fact that people from disparate places on the planet can come together either physically or through the many mediums to organize effective governance at large scales is a relatively new phenomenon made possible by technological improvements from commercial airplanes to the internet.

The United States has a somewhat unique history in that it is the formation of a voluntary union between explicitly sovereign states where in most other western countries the fundamental unit of sovereignty is the country. Since its inception there has been a fairly consistent movement towards federalism and having a strong federal government that has extensive influence in the country. Quite naturally, there is a considerable on going debate about what issues should and should not be left to states and what the federal government can and cannot do. This balance - some of which is restricted by constitutionality - is not and should not be considered an absolute. Instead, it should be recognized that the increasing role of the federal government corresponds to the technological progress which means the federal government has new capacities to provide public goods than existed in the past. The balance should be expected to change in time. I have criticized constitutional reductionism in the past, and I think the notion applies here that a very fixed view of the scope of government that does not change with technological progress is problematic. Indeed, much of the expansion of the federal government in the last century has come through a very liberal interpretation of the commerce clause which allows for the regulation of interstate commerce. A continual tension between smaller and larger jurisdictions as they vie for influence and control is to expected, and arguments for one or the other should be at a level that can modulate in time and with technological progress.

Today's world is one where the dominant political change is political globalization between countries. The world is becoming more multi-polar. The European Union is perhaps the best example where various public goods are being provided at a continental level opposed to a country level in exchange for the individual countries giving up some level of self determination. Countries no longer have complete sovereign control of their currency and many other aspects of commerce which is no determined by the Union. While Europe faces challenges to its union - particularly from the Euro because of sovereign debt - there is certainly considerable benefits to the region from the larger level provision of public goods like the monetary system. It is thus the familiar trade off between self determination and more effective and efficient provision of goods. Through ASEAN, the Arab League, the African Union and the Union of South American States we see a clear progress in political globalization towards multiple economic and political poles on the global landscape.

I have presented this post mostly in terms of government provision of these goods. Most of the principles discussed apply equally well to the hierarchical power structures that come out of markets as well. The kind of globalization that leads to around the world 'Just In Time' supply chains is a part of the same technological revolution that has underpinned a larger scale in human interaction. This increased scale comes with the same trade off that localized determination of preferences is reduced in favor of the benefits of the larger scale provision of goods. 200 years ago, 90% of laborers were farmers. They had enormous self determination of precisely how they farmed. Today, when only a couple percent of us are farmers, most of us have largely given up on a specific determination of the processes behind the provision of our food but that loss in local determination is more than offset by the benefit that modern farming practices yield in terms of an enormously efficient provision of food. As such, this post is not an adjudication upon the appropriate role of government compared to the role of the market. Much like the balance between jurisdictions, there is a balance between government and market provision of goods and the point I wish to emphasize is that this balance flexes in time and, as technological advancements make it possible for larger scale provision of goods, we should expect there to be times when this new provision is best suited to a market, times when it is best suited to government and times when it doesn't make much of a difference between the two.

On the whole, technological and sociological improvements have been an enormously positive development for human society. They have made it possible to provide these new public goods on a large scale. However, with that scale comes a decrease in a local ability for self determination and control. There will always be difficulties and challenges from hierarchical power structures that create local inefficiencies but the potential remains for this trade off to be positive and as such we should be open to allowing our notions of the appropriate scale and jurisdiction of governments and markets to flex with changing time and technological progress. 

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