Categorized | Economics, Global Economy, World

The Panama Papers: Reimainging the Moral Force of Law

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This piece was originally published by the Centre for Global Constitutionalism

The release of over 11.5 million documents from Mossack Fonseca, a Panamanian based law firm, has revealed the lengths to which individuals and companies will go to avoid their national tax obligations. When asked about the problem of tax avoidance, President Barack Obama acknowledged that those with wealth can avoid their tax systems when necessary, especially if they have the right lawyers and accountants. ‘A lot of it is legal,’ the President said ‘But that’s part of the problem.’

Those of us interested in the global rule of law and global constitutionalism should pay attention to President Obama’s point. Promoting the rule of law is hardwired into the international normative order. NGOs, international and regional institutions, and well-meaning liberals argue that law rather than politics ought to guide decisions at the global level. As John Adams, American founder and president maintained, we want a ‘government of laws and not of men’.

But law is not divorced from politics, either at the international or domestic level. A legal system results from political decisions, and those political decisions result, in part, from power configurations. Perhaps we ought to abandon our quest for the rule of law and recognize what Marxists have long emphasized, that law simply reflects a social and economic reality which, for all its pretentions, it cannot transcend. If this is true, does this mean that the quest for the rule of law is nothing but a chimera at the global level?

I’m not ready to give up on the rule of law. Without it, violence and coercive power would dominate the world order. The argument of those working in the realm of global constitutionalism is that we need not abandon the hope of a rule governed order. There must be some way to harness power and law to produce a more just and equal political order.

At the domestic level, this can come about either through representative government, although realizing truly representative institutions which are not tainted by injustice is no easier at the domestic than at the global level. Revolutionary movements to advance the cause of equality and justice are another means, one that has created the representative systems we have in many countries around the world. There is no representative institution at the global level, so perhaps we are left with the revolutionary model?

A third way might be through the device of constituent power. Constituent power is the act of a people to establish its political order through the creation of its constitution. Constitutional conventions remain the paradigmatic instance of constituent power. But as Jason Frank has argued, the constitutional convention is not the only constituent power moment; a constitutional system results from continued engagement of the people with its legal and political order. Those engagements can at times be conflictual and even revolutionary, but at other times they may be more prosaic. The point is that such constituent moments need cultivation and attention, and need to be recognized as such in order to give them the power to shape and reimagine a political order.

Does constituent power exist at the global level? If we name political protests, NGO activism, and forums in which activists and political leaders meet to articulate new agendas and ideas, then perhaps we do have something like this. Especially if those activists articulate their claims in the language of rights, law and democracy, they may well count as efforts to constitutionalize the global order.

The activism of the International Consortium of Investigative Journalists which released the Panama Papers demonstrates how those engaged in the protection of free speech and hardnosed journalism – classical liberal virtues that keep lawmakers honest in domestic societies – provides an instance of global constituent power. This organization does not represent anyone, but constituent power is not just about representative democracy; it is also the moral force that ensures constitutional orders remain true to their purpose.

President Obama is right in recognizing that tax havens are legal. But the constituent power of those who revealed the failure of global law gives us hope that global justice is possible when we make use of the emancipatory potential of law to advance rights and equality around the world. Recognizing the release of the Panama Papers as an instance of global constituent power can play a small but significant role in advancing that agenda.

Anthony F Lang, Jr holds a Chair in International Political Theory in the School of International Relations at the University of St Andrews and is Director of the Centre for Global Constitutionalism.

Image courtesy of Dronepicr.

Anthony Lang Jr

About Anthony Lang Jr

Anthony F Lang, Jr holds a Chair in International Political Theory in the School of International Relations at the University of St Andrews and is Director of the Centre for Global Constitutionalism.

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