Friday, July 7, 2017

Organizational justice II

[This may be the second part of a paper to be submitted to a conference in the Jesuit University Ignatianum in Krakow w the same title, or may be not, depending on how happy I am with the final result… it is, however, an issue I have been wanting to tackle for some time now but had postponed so far to deal with lighter matters. You may find the first part here: Part I ]

In my previous post on this subject I made a first attempt to define justice as a set of rules to determine how the benefits accruing from being part of an organization should be distributed between its members, and failed miserably. The conclusion I reached is that there is not, and there can not be, such a set of rules. The dominant reason of our time has tried to convince us that such rules do indeed exist, and are based on giving to each as much as he adds to the value of each additional unit produced (equalization of the marginal cost of the factor -in this case the salary of the employees- with the marginal price of the product, at a production level defined by the intersection of the demand and supply curve), but looking more closely “under the hood” we find there is no such thing as a supply curve, a demand curve, a marginal cost of production for each factor (be it capital, raw materials, land or labor) or even a marginal price. So in practice we are left with the old dictum the Athenians addressed to the Melians: “the strong do what they can (or what they please) and the weak suffer what they must”. The executives set the salaries as they please, and the workers accept it as they must, or go search for employment elsewhere (knowing that each departure lowers their employability and thus forces them to accept positions at a lower pay grade).

As an aside, it is difficult to escape the conclusion that such kind of reasoning (that appeared in Northern Europe around 1750, displacing baroque reason and substituting it with the new aptly named economic reason) triumphed precisely because it spared the new ascendant class (industrial bourgeoisie) to have to think “ethically” in terms of reciprocity and equal dignity between them and their salaried employees, replacing the weight of tradition (that had taken shape to ensure since prehistoric times that the non-land-owning masses could reproduce and continue indefinitely helping their masters thrive by ensuring a “living wage” for them before the concept of a market-defined wage could even exist) with an apparently impersonal, seemingly legitimate, alternative method for determining how to calculate what every worker was due. Unsurprisingly, it turned out workers in the then new industrial occupations were due much less than their forebears in the fields, but that were expected just as much to be laborious, frugal, conscientious and, above all, able to keep on having kids to ensure there would be a “replacement army” ready to take their places when they died from exhaustion and insalubrious working conditions.

In summary, the application of “economic” principles to determine the shape of distributive justice within the organization will never be able to achieve a truly fair outcome, because it was (an unexpected stroke of the “genius of History”, as nobody really intended it or planned consciously for it) designed from the beginning to favor one set of citizens (the owners of the means of production, as rusty Marxist as it may sound nowadays) over all the rest.

What are we to do, then? Recognize that modern economic organizations will never be fair or equitable or just, and propose a withdrawal into an alternative spiritual realm separate from the unavoidable materialism and the worldly concerns of capitalism? That would be the “Benedict option” as proposed by Rod Dreher, but I’m not ready to concede that’s the only viable option to live a just life yet. Because, as I mentioned in the first post on this series (yep, this one may still not be enough, so I may end up giving the subject the full series treatment), there is another alternative we have to explore first, which will lead us away from the concept of “rules for distribution” and towards one of “rules for living (or just working) together”.  And, as I intimated there, I suggest we take our lead from Kant to get there.

I will start by reminding my distracted readers that Kant seats at an interestingly unique point in the history of Western thought (recent witness of something that has only happened twice in the last twenty five centuries). The wars of religion that ravaged Europe in the XVIIth and XVIIIth centuries had debilitated the authority and plausibility of revelation, and created and opening for that most exceptional event: the substitution of the keystone of Dominant Reason: the definition of what a life well lived consists in. It is indeed before Kant’s birth when life stops being primarily a matter of preparing oneself for a future and perennial hereafter, and starts being a matter of satisfying as many desires as possible, or (another alternative and identical formulation) of achieving the best possible balance between pleasure and pain decidedly here, in this world. I won’t dwell much in how such change took place (just a callout to the most salient thinkers that shaped the new sensibility which was the precondition for the wholesale acceptance of the new dominant reason: Spinoza, who dared to point out the multiple inconsistencies and morally dubious events narrated in the Hebrew Bible -that was the “authority-debilitating” hard lifting-; Shaftesbury and Hutcheson, who translated for the English speaking world a moral philosophy owing more to the Classical Hellenistic and Stoic thinkers than to the Church fathers; and of course, Hume, who worked out a philosophical anthropology in which only the pursuit of desires could serve as  a valid explanation of behavior, developments I’ve already narrated in History of Western Dominant Reason I and History of Western Dominant Reason II ). Being a clever guy, Kant had already noticed that previous attempts to base morality (the appraisal of the goodness or badness of human actions) in how conductive any given behavior was to a greater or lesser degree of happiness were doomed to fail, for the same reason we already identified as dooming any attempt to base a criterion for organizational justice in rules of distribution: the pleasure (or pain) that each individual derives from a certain state-of-the-world is strictly incommensurable, not only between individuals, but between different moments in the life of each single individual: there is no universally valid answer to “what is preferable, that I raise my salary so I can buy an additional Ferrari, or that I raise yours so each fifty of you can buy and additional loaf of bread?” (regardless of how strongly we may feel that only one answer is morally acceptable, the Ferrari-loving bosses of the world have ultimately succeeded in convincing us, through three centuries of tireless economic thinking, that it is far from a settled matter). There isn’t even a universally valid answer to the question “what is preferable, that I enjoy an additional glass of wine now that I am young and healthy, or that I abstain and thus enjoy a slightly milder and more wholesome old age, when I will be more weak and infirm no matter what?”  

Having been awakened of his “dogmatic slumber” (a very famous sentence penned by himself that has become a hopelessly worn-out commonplace, but the more I think about it the less sense am I able to make of it) by none other than Hume, Kant then started from the premise that a rule for the distribution of goods (or services) could never form an adequate basis for regulating the relationships between men, no matter how apparently impersonal (and thus “impartial” in some objective sense) it were. All that Hume wanted with the appeal to such rule was a justification of the then forming system of production (early capitalism) based on strong property rights (indeed, all the chapters on justice within the Treatise on Human Nature just deal with the need to respect validly formed and socially sanctioned property rights, regardless of how such property was acquired at the dawn of society). Hume himself knew that a society purely based on the pursuit of ever increased material goods bounded only by the respect of private property wouldn’t go very far, as countless coordination problems would arise for which no solution would be available within such purely egoistic framework (in more recent days people like Deirdre McCloskey have tried to resurrect the idea that respect for property rights and admiration for those that enjoy great amounts of them is almost exclusively all that is needed for a well-ordered, well-functioning society, in what constitutes one of the purest, most unadulterated defenses of our current form of dominant reason… the fact that the people under such reason is deciding in growing numbers not to perpetuate it should give us pause as to how unquestionably good and not amenable of being improved upon it really is). Hume’s solution was to add another principle to his understanding of man, that of sympathy for our fellow beings, that should ensure that we do not let our unbridled selfish interest conflict too much with that of the rest of our countrymen, allowing for some mutual concession and thus the potential resolution of such coordination problems.

But the appeal to sympathy can clearly be seen not to be up to the task, as sympathy is too elastic a principle, too amenable to being applied in degrees to be able to solve what we may term the “Ferrari problem” (even if I have all the sympathy of the world for the workers in the factory I own, I may consider they are already well-fed enough, and I really, REALLY, would enjoy that new Ferrari a lot, damn it!), which stands for every distributional justice problem we may think of. Remember that at bottom, our criticism of economic rules (be they classical or marginalist) rests on the premise that there is no such thing as a valid “utility” (being logically coherent, as in stable in time, transitive and commensurable between different individuals) that we could use to compare the moral worth of different potential outcomes (or of alternative distributions). If you substitute “feelings” or “emotions” for “utility” you should immediately be able to see what Kant saw: that Hume’s proposal for morally conducting ourselves (which we could cartoonishly summarize as “respect private property and be somewhat sympathetic to your fellow humans” -at least it clearly beats that of the Mongols: “if the city surrenders kill only adult males and rape all the women, if they resist kill everybody (after the raping, that is)”-) was a dead end, increasingly invalid for the needs of a growingly complex society.

His genius was abandoning the distributive framework altogether (he overcome it by transcending it, by casting a wider net), and instead of focusing on what rules should there be so everybody receives what they are due he decided to focus on a wider set: what rules should there be so everybody is treated fairly in every interaction, not just when the pay day comes around. He also identified (successfully, in my humble opinion) the biggest obstacle to acting morally (and another reason why any attempt to base behavior on feelings should fail to achieve fair outcomes): we humans are a selfish lot, regardless of how sympathetic we consider ourselves (or we teach ourselves) to be. In another worn-out commonplace of his: “from the crooked timber of humanity never straight ever came out”. We rest satisfied with giving little and taking a lot. Our true motives many times elude us, and rest hidden even from ourselves. Even when we feel we are being virtuous and upright, we may be acting mean and unjustly.

You may disagree with Kant’s philosophical anthropology, and highlight instead how evolution has made us a social being, prone to cooperation (but a rather particular sort of cooperation, that based on expected reciprocation, and we have as many evolved mechanisms to detect potential defectors and non-reciprocators and punish them as we have to offer tentatively to collaborate with strangers). His greatness comes from seeing that a truly moral system could not rest on the expectation of goodness (or lack thereof) from others. We had to be good, even in a world populated by devils. We had to be kind and helping and nurturing towards others absolutely, not because they deserved it, not because we expected them to reciprocate, but because they, being rational, had an unconditional dignity that demands it. Note that I’ve said “demands”, not “earns or may earn”, not “can give it in exchange”, not “merits”. Even the dumbest, less cultivated, laziest and even crookedest human being, just for being human (and thus having at least the potential of being rational, even if that potential is not entirely fulfilled) has dignity and has to be given certain rights and certain recognition. He then may, freely, do bad deeds that deserve to be punished, and thus have some of his rights abrogated.

The second element of genius in Kant’s thought is seeing that emotion (in XVIIIth parlance it would be more correct to speak of “passions”) is not a reliable guide to good behavior. He overturns Hume’s arch-famous dictum that “reason is, and can only be, a slave to the passions” and proposes we go back to the Greek ideal of understanding reason as the charioteer that drives the chariot pulled, it is true, by desire and passion (epithymetikon and thymos, I know the choice of modern terms may be contested). And to counter Hume’s argument that reason is toothless, that it can never move us to act (an argument based on an understanding of reason as the ability to “compare propositions regarding the number and qualities of what we perceive”) he resorts to an intuition that ends up being (again, in my most humble opinion) stranger than the Scot’s objection: reason may be just the ability to compare propositions (or whatever other combination of mental acts), but it results in the ability of choosing different courses of action, as attested by the perception every one of us has of having a free will. That free will, however mysterious may be, is only understandable if we can present our own actions to ourselves as particular instances, or applications to particular circumstances, of general rules. Being truly free, then, is the same as acting in accord with true reason, and consists in following those rules that we have chosen ourselves to follow (that we have autonomously legislated for ourselves, to which we have decided to bind ourselves). It is now evident why Kant’s anthropology is not only incompatible with Hume’s, but its exact opposite: no place here for passions (“Sympathetic”, prosocial or otherwise) and no need to postulate a highly suspect universal “taste” (a word too socially caused and too variable between different societies to carry all the philosophical water that Hume asks it to carry) to explain how we manage to praise and condemn the same behaviors. Being free and acting reasonably are two sides of the same coin, that, if pursued consistently, would lead us to collectively build a “kingdom of ends” (Reich der Zwëcke) where those deserving to be happy would, indeed, be happy (something we can not count on happening in this Earth, because of the “crooked timber” problem we already mentioned).   

And indeed that “kingdom of ends” is a much better model for a just organization than the imagined set of selfish “optimizators” that try to maximize the amount of goods they receive under some distributional rule or other (“rules” not in the Kantian sense of “maxims” that guide our conduct, but of comparisons between heterogeneous and discontinuous quantities, like “marginal cost” and “marginal value” that purport to determine the ratio of exchange between them), sprinkled with varying (and impossible to measure) amounts of sympathy that the economic model proposes. In the “kingdom of ends” (from now on KoE) we treat each member of the organization as we ourselves would like to be treated, so there goes the Ferrari problem. We ensure certain inalienable rights are respected, and we clearly delineate the duties that come with those rights. We use people as ends in themselves, and never as means (2nd formulation of the Categorical Imperative). 

I dare to postulate as a universal rule that anybody in his right mind would prefer to work in a KoE organization rather than in an economic organization (expect those that would be assured to be in leadership positions with an inordinate fondness for Ferraris, who may prefer the economic alternative… we may question, however, to what extent such profile is compatible with the common definition of “being in his right mind”). However, that postulate does not allow us to consider the case closed, as it only reflects the interest of a portion of the stakeholders of any organization (namely, the employees). What if economic organizations are more efficient, and thus the whole of society (consumers, future generations) is better served by them? What if economic organizations can consistently generate higher returns on investment, and thus the owners of the invested capital are better served by them? How should we balance the legitimate demands of different groups of stakeholders against those of the employees?

Those are all valid questions, that will obviously require an additional post to be answered (another way of thinking about it: once we have set aside distributive justice as the right framework to deal with fairness in organizations, and turned to procedural justice, which gently nudges us towards a more contractualist approach, we must see how the inherent conflicts of interest around the organization, not just within it, are dealt with by the new framework). 

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