Lecture 25: Democratic Justice: Applications

What this lecture covers

This is the final lecture of the course. Having argued that democracy is a subordinate good that should constrain, but not override, the superordinate goods people pursue in different spheres of life, Shapiro works through two concrete applications: governing children and governing the workplace. Both cases involve inevitable hierarchies, so the question becomes how to democratize the exercise of power within them without wrecking what the hierarchy is for.

By the end you should be able to explain the difference between a child's basic interests and best interests, why the state and parents are assigned fiduciary responsibility for each, why democratically-run firms are usually less efficient than hierarchical ones, and how the idea of a continuum between a "Dickensian nightmare" and a "surfer's paradise" shapes the case for regulating employers. The lecture closes with Shapiro's assessment of Tocqueville's claims about democracy.

Key ideas

• Democratized Burkeanism: institutions are never designed from scratch; the goal is to inherit and reproduce them while gradually democratizing their power relations, not to overturn or blindly preserve them.
• Basic interests vs. best interests: basic interests are what a child needs to survive and function in the economy and polity; best interests are what it takes for the child to thrive and flourish.
• Fiduciary: someone who exercises authority on another's behalf without the charge owing them anything in return; the arrangement ends once the charge can act for themselves.
• Lockean disenfranchisement principle: people should be denied a say only to the extent necessity requires, and no more.
• State as fiduciary of basic interests, parents as fiduciary of best interests: this split creates two hierarchies that check each other, since neither can fully substitute for the other.
• Hansmann's efficiency argument: democratic firms only match hierarchical ones in efficiency when workers are interchangeable (law firms, taxi co-ops); otherwise, democratic procedure costs time and money.
• Dickensian nightmare vs. surfer's paradise: a continuum between an economy with no safety net and one with a very high social wage; where an economy sits on it determines how costly it is for workers to exit a job, which in turn shapes how much the state should regulate the firm.
• Power externalities: the wider system of power relations surrounding an institution, which must be considered alongside the power relations inside it.

Walkthrough

Recap and the challenge of governing children (0:01)

Shapiro reviews Monday's argument that democratic justice is semi-contextual: democracy is a subordinate good that should limit, without displacing, the superordinate goods people pursue in institutions like the family or workplace. He then explains why governing children is the hardest test case: children cannot meaningfully participate in collective self-governance or mount informed opposition, so the hierarchy over them is inevitable. Drawing on Locke, he argues that disenfranchisement is only justified by necessity, and applies this to the historical lengthening of childhood and adolescence, illustrating the tension with the Summerhill school example, which he argues worked only because it was a cocooned, well-off environment shielded from real consequences.

Basic interests, best interests, and the fiduciary relationship (13:23)

Because children are stuck in an inevitably hierarchical situation, Shapiro proposes checking one hierarchy against another. He distinguishes basic interests (resources needed to survive and function, echoing Rawls's primary goods) from best interests (thriving, happiness, and fulfillment), and argues the state should be the fiduciary of the former while parents are the fiduciary of the latter. He explains the fiduciary concept through Locke's point that a grown child owes a parent nothing, since consent is the basis of obligation and the child never chose the relationship; a parent's only real leverage is the threat to disinherit.

Applying the two-hierarchy model (20:39)

Shapiro works through cases showing how the state-parent split plays out: Wisconsin v. Yoder (he argues the Amish parents should have lost, since keeping children out of school to preserve community membership isn't a legitimate best-interest claim), Christian Scientists refusing a blood transfusion (parents should lose because a basic interest is at stake), and objections to school reading material (parents should generally win, since this concerns moral education, a best interest). He notes that the line can shift over time, using sex education becoming a public health issue once AIDS emerged as an example, and stresses that because the state holds more power, the burden of proof should fall more easily on the state than on parents.

Democracy in the workplace and the limits of firm democracy (30:02)

Shifting to competent adults, Shapiro turns to employment. He presents Henry Hansmann's argument, from The Ownership of Enterprise, that if democratically-run firms were more efficient they would have outcompeted hierarchical ones, and that claims to the contrary (1960s-70s comparisons with Japanese firms, or Mondragón cooperatives) did not hold up. Democratic governance only matches hierarchy in efficiency where workers are interchangeable, such as law firms or plywood co-ops; in most firms, democratic procedure over things like pensions consumes time that comes at a real efficiency cost. Shapiro also disputes Hansmann's view that shareholders enforce accountability, arguing their low exit costs (they can simply sell their shares) make them weak monitors of firm behavior.

The Dickensian nightmare to surfer's paradise continuum (35:15)

Since firms will remain hierarchical, Shapiro asks how the state should regulate the exercise of power within them. He introduces Philippe Van Parijs's idea of a very high social wage (the "surfer's paradise") at one extreme and an economy with no safety net (the "Dickensian nightmare") at the other. Using the example of an employer threatening a secretary's job for sexual favors, he shows that the secretary's exit costs, and therefore vulnerability to abuse, depend on where the economy sits on this continuum. The closer to a Dickensian nightmare, the stronger the case for state protections such as grievance procedures and union rights; the closer to a surfer's paradise, the more workers can absorb the costs of hierarchy themselves. He extends this to employer-provided health insurance, reframing what looks like a conflict between capital and labor as a collective action problem among competing employers, and argues that firms actually have an incentive to support an expanded social wage because it gives them more flexibility to restructure without cumbersome regulation.

Closing reflections on Tocqueville and democracy (46:31)

Shapiro ends the course by revisiting Alexis de Tocqueville's two claims: that democracy's progress is inevitable, and that its "wild instincts" must be domesticated rather than eliminated. He agrees democracy has world-historical force but disputes that its advance is inevitable, pointing to repeated setbacks (1830, 1848, and democratic collapses after 1989) to argue that sustaining democracy takes active work. He also argues Tocqueville underrated democracy's capacity to undermine bad things, such as slavery and the exploitation of workers, and closes by restating the course's core theme: democratize inherited institutions as we reproduce them into the future, without needlessly damaging the superordinate goods they serve.

Before you watch

• This lecture assumes the semi-contextual theory of democratic justice developed in the previous lecture, including the distinction between subordinate and superordinate goods.
• Familiarity with Rawls's concept of primary goods and Locke's consent-based theory of obligation, covered earlier in the course, helps with the discussion of basic interests and fiduciary duties.
• Recognizing Tocqueville, discussed earlier in the course, is useful for the closing section.

Check your understanding

1. Why does Shapiro assign the state fiduciary responsibility for children's basic interests but parents responsibility for their best interests?
2. According to Locke, why doesn't a grown child owe anything to a parent, even after years of care?
3. Under what conditions does Hansmann argue democratic firms can match hierarchical firms in efficiency, and why do most firms fall outside those conditions?
4. How does a firm's position on the Dickensian-nightmare-to-surfer's-paradise continuum affect how much the state should regulate it?
5. Which of Tocqueville's two claims about democracy does Shapiro accept, and which does he reject, and why?