Private Government By Corporations

Posts in this series. This post is updated from time to time with additional resources.

The second chapter of Elizabeth Anderson’s Private Government: How Employers Rule Our Lives (And Why We Don’t Talk About It) begins with a striking image: the US corporation as communist dictatorship. The employer has the absolute rights to do as it sees fit with its employees with few restrictions. She singles out a few of the more absurd rules: an employer can fire a worker because of the way the worker votes, or opinions the worker expresses about politics, or, as we learn in one case, because the son of a friend of the employer raped the employee’s daughter.

We usually think of government as meaning only the state. Anderson says we need a broader definition of government: the legitimate exercise of power by one person over another. Thus, masters govern their servants and slaves, parents govern their children, the Church governs the faithful, the bridge club leaders have the right to exclude people from their games, and so on. We see something akin to this in Foucault’s discussion of governmentality.

Then Anderson draws the distinction between private and public government. A government is public if it is required to consider the interests of the governed, if governed people have the right to participate in the management of the government, and to review its actions and hold it accountable. It is private if the interests of the governed are irrelevant, if they have no power to influence or question the actions of the government.

Anderson defines the state following Max Weber in his essay Politics As A Vocation.

Weber’s definition is the following: “The state is seen as the sole grantor of the ‘right’ to physical force. Therefore, ‘politics’ in our case would mean the pursuit for a portion of power or for influencing the division of power whether it is between states, or between groups of people which the state encompasses.”

The state as the sole grantor of the right of the use of violence has a specific meaning. Only the state can empower a private group to exercise government over others. The master has the right to control the slave because the government says so. Parents’ rights to control children have the sanction of the state. Under the law of Coverture, husbands had the right to control the bodies and wealth of their wives. Anderson points to John Adams’ response to Abigail Adams request to “remember the ladies” in the construction of a new government.

Depend upon it, we know better than to repeal our masculine systems.

In each of these cases the state can regulate the control exercised by the grantee. For example, a state could determine that a parent hitting a child is abusive, and could punish the parent and take the child into protective custody. Or the state could simply withdraw its grant of control, as it did with slavery or the law of coverture.

The case of the corporation as employer is similar. The state could withdraw the right of the corporation to exercise any aspect of government it chose. It could, for example, make it illegal to fire a person who refused to attend a political rally for the candidate of the CEO’s choice; or more generally for any reason related to the employee’s politics. It can limit the right of an employer to fire an employee for illness.

In general, capitalists object to any infringement on their right to dominate the lives of their employee. The usual argument has to do with what capitalists call “freedom”, defined as the right to have the state leave them alone. Anderson could argue as she does in other cases, that this negative freedom for the capitalist inflicts massive losses of negative freedom on employees, who cannot support candidates of their choice, or stay away from undesirable political rallies, or organize into unions, or get sick. Thus, unrestrained control for capitalists requires substantial justification.

Instead, she points out that besides negative freedom, there are two other equally or more valuable kinds of freedom*: positive freedom, meaning having a wide choice of opportunities, and freedom from domination. It is frequently the case that restraints on negative freedom for a few produces much larger overall increases in these kinds of freedom.


1. The idea of private government mirrors the ideas of Bruce Scott and of Ellen Meiksins Wood on the role of corporations in the US. See this post.

2. Anderson seems to think a different outcome was possible, one in which the employer had control over the lives of employees only as to their jobs. I’m less sure of that. It seems to me that changes in the method of production do not impact the general governmental structures of a society. As Anderson points out, in England in the middle ages production was organized around feudal estates and guilds. Each was based on the idea that of top-down control. The monarch owned the real property and granted use rights to the aristocracy, which controlled agricultural production, and took much of the product for itself. Guilds acted as controllers of cloth and other artisanal goods, and decided who could participate and on what terms. In each case there was top-down control by agents empowered by the Throne to impose sanctions and discipline.

Private life followed the pattern. Husbands controlled wives, children, and servants. Churches exercised control over the religious lives of their parishioners, extracting tithes and demanding obedience.

As the methods of production began to change, these governmental structures remained in place. Apprentices were tacked onto that structure in the position of servants. When women started doing piecework for textile mills, they remained dependents. Fathers or husbands took their wages and used them as they saw fit. When children were put to work in mines and mills, they remained dependents of their fathers, who took their wages and used them as they saw fit.

The only change was the way people worked, not their social relationships. Those social relationships arose from ancient times. Anderson discusses the social theory that everyone must be controlled from above. This pattern starts with the Almighty, and continues through the monarch, down through aristos to common people to serfs and slaves, in what was known as the Great Chain of Being.

Social changes were in the long run influenced by the changes in the means and methods of production, as we can see from Anderson’s and Ann Hughes’ (Chapter 3) discussion of the Levelers and other dissidents in the mid-1600s. But those social relationships have a powerful hold on the minds of people. Like most bad ideas, the idea of the necessity of control from above is nearly impossible to eradicate. We see it today in different parts of society; where Biblical injunctions about wives and servants** still hold sway. John Adams was right. Men of all ranks will not want to give up their rights under their masculine systems.
*I discuss these freedoms at length earlier in this series. See the linked index.
** Some translations have “slaves”.

Freedom And Equality: Anderson Against Libertarianism

Posts In This Series. This post is updated from time to time with additional resources.

The first four posts in this series discuss two articles by Elizabeth Anderson explaining her view of freedom and equality. The text for this post is her chapter titled Freedom and Equality in The Oxford Handbook Of Freedom And Equality, available online through your local library.

In the last post I said that relational equality* is a principle of social relations, and not a principle of the distribution of material goods and opportunities. But as Anderson says, relational equality entails a certain minimum level of material distribution. Material redistribution is flatly rejected by libertarians**. It’s easy for progressives to forget that there is a philosophical basis for libertarianism, with well-known exponents, including Robert Nozick. Anderson takes on the libertarians in this chapter. She argues that freedom as non-interference, the ground of libertarianism, cannot justify a regime of private property.

In Part 1 of the chapter, Anderson describes different ideas about freedom and equality, and gives some examples. This section covers the ground of the first four posts in this series, and is easy to follow. In Part 2, she addresses the libertarian arguments justifying private property strictly on the grounds of negative liberty*, that is, freedom from interference.

Anderson starts with a brief discussion of taxes. In standard libertarian thought, requiring someone to do something is normatively different from requiring someone to refrain from doing something. Thus, ordering people to supply others with goods and services is different from ordering people not to take the property of others. Libertarians say that taxes raise revenue for the government which is used to supply goods and services to others, and so taxation is normatively wrong. The basis for this assessment is that income is associated with labor, so that making people pay taxes is directly the same as making them work for others. Anderson points out that this may be true of taxes on wages, but it obviously irrelevant to passive income, as that from investments, capital gains, mineral royalties, rents, bequests and interest.***

She points out that taxes on land rents can be justified as “respecting the property rights in the commons of those who lost access to privately appropriated land.”

But that’s just the first point. Anderson’s focus is on the priority of positive freedom in connection with property rights. This argument is more complex. First, she points out that even libertarians do not argue for absolute negative freedom with respect to property. Perfect negative liberty means that no one has the right to demand that the state assist in constraining an owner’s use of property. As far as I know, no one, even the most rigid libertarian, makes tsuch an expansive claim. Therefore the claim to private property is a right.

If claims to property are rights, then they entail duties in other people. If the owner excludes others from property, exercising the owner’s right to non-interference, then others lack the right to use of that property. Their right to use of that property is interfered with. On numerical grounds alone, this negative liberty of one person creates a massive net loss of negative liberty.

… to secure the right of a single individual owner to some property, the negative liberty of everyone else — billions of people — must be constrained. Judged by a metric of negative liberty alone, recognition of property rights inherently amounts to a massive net loss of total negative freedom.

To justify this massive net loss of negative freedom, we must look to other kinds of freedom. Positive freedom* supplies a good answer. Private property can improve overall economic outcomes for the many. Properly used, it can create greater opportunities for many. Receiving the benefits from improvements can encourage more of these benefits. Freedom from domination* is protected and increased when in a system of regulated private ownership which prohibits the use of private property to dominate others.

To use these arguments, though, we must prioritize positive liberty and freedom from domination over negative freedom. This, of course, was the point Anderson is trying to show.

Instead of libertarian negative freedom as the primary principle of society, Anderson offers a social contract view of private property.

In this picture, the principles of right are whatever principles persons would rationally choose (or could not reasonably reject) to govern their interpersonal claims, given that they are, and understand themselves to be, free and equal in relation to one another.****

Generally people would choose a regulated system of private rights so as to ensure reasonable economic efficiency, order, and maximum positive liberty and freedom from domination. In this setting, individual rights are not grounded in selfish interests as in libertarian thought, but in the reality that we all have “a common interet in relating to each other through a shared infrastructure of individual rights.”


1. As I read this section, Anderson is trying to show that prioritizing negative freedom, meaning noninterference, is not a solid foundation for a decent society; and I think she succeeds.

I have never thought libertarianism was sensible. In high school, I read Anthem by Ayn Rand, which I took to be an anti-communist screed, mildly enjoyable and short. In college, I read The Fountainhead and Atlas Shrugged, and I realized that Rand was actually arguing for radical selfishness. The books are badly written and laughably simple-minded, and impossible to take seriously. Essentially libertarians want social protection for themselves and their property, but think it is theft if taxes are used for anything besides protecting them and their rights and giving them stuff. Their society looks like the Gilded Age, when state and federal governments called out the militia to attack striking workers. Let’s just skip past all the jargon. As a practical matter, Libertarians need to explain why those workers should support their ideal society. A similar question should be asked of today’s plutocrats and their enablers.

2. The tax question is a good example. I noted Anderson’s view of earned vs. unearned income issue, and her argument based on the principles of social contract theory. Social contract theory is the idea that we as a group implicitly agree to certain rules and institutions, surrendering some of our rights and accepting some duties, in exchange for protection of our remaining rights and creating and maintaining social order.

The justification for this theory is that life is better in such a society. In a democracy we select our leaders and can vote them out. This is a form of freedom from domination by government, and to the extent we can force government to act, it frees us from domination by employers.

“Taxes are what we pay for civilized society” as Oliver Wendell Holmes said. For now, I’ll just note that in Modern Money Theory, Holmes is not quite right. In nations that issue their own currency there is no connection between spending and revenue. In the MMT model government spends money into the economy and taxes bring some of it back to the government; and this is done for several reasons, including stabilizing prices and the value of money. That model seriously undercuts the primary argument that taxes are extracted from the successful to buy stuff for losers.

* These terms are discussed at length in prior posts

**Thus we are regularly treated to the idiot claims that taxation is theft, and that affirmative action is an unfair benefit to minorities and to the working class.

*** One thing I love about Anderson is that she never limits herself to a list of three examples followed by etc. Here she identifies 5.

**** This starting point is similar to the Veil of Ignorance of John Rawls in A Theory Of Justice.

Freedom And Equality: Freedom From Domination Part 1

Introduction and Index

Elizabeth Anderson wrote a chapter for The Oxford Handbook of Freedom and Equality, titled simply Freedom and Equality. She begins by acknowledging that perfect material equality would require an authoritarian state, and no one seriously argues for that position. On the other hand, Friedrich Hayek argued in The Road To Serfdom that any form of socialism would lead down the slippery slope to totalitarianism, but he was wrong. There are realistic choices short of perfect material equality, such as the societies of Western Europe with their social democratic forms of government and economy.

Anderson writes:

To make progress on the question of normative trade-offs between freedom and equality within the range of options for political economy credibly on the table, we must clarify our concepts. There are at least three conceptions of freedom — negative, positive, and republican — and three conceptions of equality—of standing, esteem, and authority.

Republican freedom is an unfortunate term, given its association with a political party with a highly … nuanced view of freedom. Philosophers use the term because it is associated with the Roman Republic of Cicero and Cato. And that is another unfortunate juxtaposition, because the leading libertarian think tank is the Cato Institute, which is heavily funded by the Charles Koch Foundation, another group not that interested in broad concepts of freedom. So I’m not going to use the term, and instead will refer to it as freedom from dominanation, or non-domination.

In her book chapter, Anderson offers a brief description of the three forms of freedom: negative freedom as noninterference, positive freedom as opportunitites, and non=domination.

Sarah has negative freedom if no one interferes with her actions. She has positive freedom if she has a rich set of opportunities effectively accessible to her. She has republican freedom if she is not dominated by another person — not subject to another’s arbitrary and unaccountable will.

For the last few decades, talk about freedom has meant almost exclusively negative freedom, with occasional references to positive freedom. Anderson says there has been a recent revival of interest in freedom from domination, citing a book by Philip Pettit, a philosophy professor at Princeton, titled Republicanism: A Theory of Freedom and Government. Here’s a paper written about the same time as the book, Freedom With Honor: A Republican Ideal. 64 Social Research, Vol.1, p. 52.

Pettit starts with the proposition that

The decent society, as Avishai Margalit … defines it for us, is one in which the institutions do not humiliate people. They do not deprive a person of honor. … They do not cast the person as less than fully adult or human.

He obviously isn’t talking about the Republican party. Honor is a crucial issue for humans, both personally and as the ground for participation in society, and thus is a central element of a decent society. Pettit says that negative freedom, that is, freedom from interference, is the heart of liberalism, by which he means the philosophical perspective common in the 19th Centuries, not our 21st Century usage as a political ideology. We would use the term neoliberal to refer to people who hold this political stance today.

… I think it is fair to say that almost all contemporary descendants of nineteenth-century liberalism agree on the equation of liberty with negative liberty. All agree that I am free “to the degree to which no human being interferes with my activity” [quoting Isaiah Berlin, Two Concepts of Liberty, 1957].

Negative freedom can exist in a society in which the institutions undermine and jeopardize the grounds of self-respect for some of its inhabitants. Institutionally people may be treated as a second-class citizen without interfering directly with their choices.

This seems intuitively obvious but Pettit only makes an argument; he doesn’t offer examples. Here are three that seem right to me. First, consider the status of women in the 19th Century. They were treated as dependents economically, politically and socially. The attitudes of women towards themselves were largely created by institutions such as the family, the Church, and the education system. They were not free to form their own projects for themselves, to act fully as agents in their own lives, or to determine their own views of themselves free of these institutions. Of course these institutional constraints were reinforced by laws, but the laws had their origins in those institutions, and did not touch most of the effective limitations.

My second example is our education system. Every child is entitled to education, but the quality of that education is systematically worse for working class children and children of color. There is no interference with the liberty of every parent to send their child to the best school they can afford, and there is a public school for every child. But the schools for upper class children generally are better than the schools for middle class children, and the schools for working class and poor children are worse. What’s important is the ways they are worse. Generally they perpetuate the class status of their parents. And generally, they reinforce the existing schemes of social domination. We saw the importance of this in our discussion of Pierre Bourdieu’s work; here’s a sample.

My third example is the treatment of employees by employers. We all know that many employers systematically abuse their workers. There is some protection for certain kinds of abuse, such as abuse based on gender or race. But who stops the humiliating practice of driving employees to pee in bottles or wear diapers?

I offer these examples without citation, appealing perhaps to my own preconceptions, but I think they give a flavor to Pettit’s bare argument.

Looking more closely at these examples, we can see that protecting the dignity of women, children, especially working class children and children of color, and workers, will require interference by the state. But husbands and fathers, school boards, and employers would argue that state interference restricts their freedom, their rights to noninterference. That illustrates the central point made by both Anderson and Pettit: noninterference with respect to one person is an interferes with the choices of many others.

That explains the central justification for replacing the concept of negative liberty with freedom from domination. Admittedly, freedom from domination is a kind of negative liberty. But negative liberty is based on small group relationships (husband/wife, employer/employee, school/child) where one party has power over another, whether by tradition, money or by law. Freedom from domination is created by a democratic government established expressly for the purpose of constructing, maintaining, and improving a decent society, in which every member’s honor and self-respect is the central goal.