A retrospective on economic recovery, institutional success and the public capacity to reconsider the arrangements that shape our lives.
My illustration entitled: “The Banquet and the Unclaimed Crown” – A diverse community shares a generous harvest banquet. At the centre, a crown rests beside an open book and a pen; everyone has a place at the table.
What recovery cannot decide
Looking back at 15 January 2010, I see a question beneath the urgent business of economic recovery. Once institutions have helped restore prosperity, what authority should they retain over the future of those who depend upon them?
The financial crisis had made dependence visible. In September 2009, the International Monetary Fund reported that extraordinary government action had helped stabilise financial markets, while warning that recovery remained vulnerable. It also described the transfer of financial risks from private institutions to the public sector. Restoring economic function was an urgent task; deciding the terms of the restored order was another. [1]
My question is broader than whether a rescue was justified. Does creating prosperity give an institution the right to determine its beneficiaries’ economic future permanently? I argue that it does not. Competence can justify a mandate, remuneration and considerable operational discretion. It cannot, by itself, justify closing the procedures through which that mandate may be reconsidered.
I propose Reauthorism as a political-economic philosophy holding that essential economic arrangements should sustain independently governed knowledge, resources and practical capacity through which affected publics can reconsider their purposes, rules and structures, including during successful operation and after ownership changes. This is a present-day interpretation of the historical setting, not a claim about what anyone called Reauthorism in 2010.
Where public authorship becomes relevant
By an essential economic arrangement, I mean a durable combination of institutions, assets and rules that substantially governs access to basic necessities or the conditions of economic participation, where dependence is significant and realistic alternatives are limited. A regional water network, a settlement system or an infrastructure concession may qualify. Size, profitability and public interest alone do not settle the question.
The relevant tests concern necessity, dependence, available substitutes and consequences for others. An ordinary small business operating among accessible competitors would usually fall outside this special obligation. Its customers’ preferences do not give them unrestricted authority over its purposes. A small operator controlling a community’s only viable water source could raise different questions. Essentiality belongs to the relationship, not simply the enterprise’s size.
An affected public comprises people whose basic opportunities, essential access or exposure to substantial shared risks are materially shaped by the arrangement. It can include users, workers, residents and those bearing environmental or financial consequences without being customers. Mere curiosity or a remote effect does not establish an equal claim over every decision.
Such a public is neither homogeneous nor self-appointed. Its boundaries require published criteria and independent challenge. Different decisions may warrant different constituencies: workers have particular standing on workplace conditions, while downstream residents have standing on water consequences. Representation must also account for those unable to participate directly and for foreseeable burdens on future users.
By authorship, I mean an effective, institutionally protected capacity to understand an arrangement, formulate alternatives and participate through legitimate procedures in decisions about its purposes, rules and structure. It requires some route to an authoritative outcome, not merely permission to speak. It gives neither every participant a veto nor any majority unlimited power over others.
Benefits, approval and authority
Receiving benefits matters. Reliable water, secure savings and productive employment make freedoms usable. But receiving a good does not establish authority over the terms on which it is produced. People may enjoy excellent provision while depending entirely on a provider’s discretion about future access, investment or governance.
Consumer choice influences suppliers through purchasing. It may leave the rules of a necessary network untouched. Consultation collects views but may give those consulted no standing to initiate or secure reconsideration. Ownership can confer substantial authority, yet shareholding by some beneficiaries does not represent all affected people, and a transfer of title can alter whose interests govern.
Compensation addresses a loss; it does not necessarily give the recipient a say in future decisions. Exit protects freedom to leave, but leaving a town or abandoning an essential service may be profoundly costly. Even an affordable exit does not answer what authority people possess over an arrangement they have good reason to continue using.
Good performance supplies a strong reason for continuation. Popular approval supplies evidence of support. Neither establishes continuing authorship if the means of inquiry, proposal and decision remain under the incumbent’s exclusive control. Approval is more informative when people can examine credible alternatives and organise without risking their livelihoods.
Efficiency also needs a specified purpose. An arrangement can deliver a chosen output economically while excluding people from deciding whether that output, its distribution or its long-term consequences should change. My normative premise is that significant dependence should not require permanently surrendering standing over these questions. A person may endorse a governing arrangement without alienating all future capacity to reconsider it.
Predecessors, and the question I am proposing
These concerns have substantial predecessors. In The Public and Its Problems (1927), John Dewey located the public in consequential relationships, including the indirect effects of transactions on others. His account also made inquiry and communication central to the organisation of a public. My definition draws on that approach while specifying a narrower economic concern with essential dependence. [2]
Albert O. Hirschman’s Exit, Voice, and Loyalty (1970) distinguished departure from attempts to change an organisation from within. That distinction helps explain why switching providers and influencing institutional direction are different capacities. I extend the question here to successful provision: can people reconsider an institution before deterioration supplies an obvious reason to protest? [3]
Elinor Ostrom’s Governing the Commons (1990) studied enduring self-governed arrangements, including irrigation systems in Spain and the Philippines. She explicitly distinguished institutional endurance from unchanging operational rules and also examined failures. These histories show that successful cooperation and revisable rules can coexist; they do not establish that participation always succeeds or costs nothing. [4]
F. A. Hayek’s “The Use of Knowledge in Society” (1945) supplies a necessary challenge. Relevant knowledge is dispersed, and central direction cannot simply gather it all into one mind. I take that seriously: public authorship should preserve multiple sources of knowledge and room for decentralised action. This is my application of his argument, not a claim that Hayek endorsed Reauthorism. [5]
I therefore claim neither the invention of participation nor the discovery that institutions can change. The proposed Reauthorist emphasis is the durable combination of independent knowledge, usable resources and effective revision procedures, preserved through success and ownership transfer. Whether this combination warrants a distinct philosophical framework remains open to criticism.
My illustration “The Banquet and the Unclaimed Crown” work-in-progress. The art represents that shared prosperity leaves governing authority open to renewed consent.
Hypothetical example: two equally successful water institutions
Imagine two regional water institutions in the economic setting of early 2010. This is a hypothetical comparison, not a description of actual organisations. Both provide equally safe, reliable and affordable water. Both maintain their infrastructure, treat workers fairly and enjoy equally high public approval.
At Institution A, the operator alone controls the operational evidence, commissions assessments and decides whether proposals for structural change receive consideration. Public meetings are frequent and courteous. Existing safety regulation remains effective, but the affected public has no funded route to examine different investment priorities, ownership arrangements or governing purposes independently of the operator.
Institution B works under the same service obligations. In addition, a separately governed review body holds protected funding, access to necessary records and the ability to commission independent engineering and financial analysis. Users, workers and affected residents have defined representation, protected organising opportunities and a procedure for placing qualified proposals before an authorised decision-making forum.
That forum might be a representative public authority acting under a published charter. It can approve changes within specified powers, subject to rights, evidence and appeal. The operator manages daily provision. The review body cannot casually seize assets or issue technical commands. Its task is to make reconsideration practicable.
After examining alternatives, Institution B’s public may deliberately retain the existing operator, investment programme and ownership structure. That outcome can express authorship because continuation follows a usable opportunity to decide otherwise. Institution A’s identical performance does not establish the same standing. The difference concerns the conditions of continuation, not an obligation to replace what works.
If Institution B is sold, its proposed charter requires the review rights, funding and necessary information access to survive the transfer. A buyer receives the operating opportunity together with disclosed obligations. Without such continuity, people’s standing would depend on the preferences of successive owners.
The strongest objection: revision has real costs
The strongest objection is that this additional capacity consumes resources and may weaken the stability that prosperity requires. Independent expertise, protected records and representative procedures cost money. Investors may demand higher returns if mandates are revisable. Organised groups may exploit review to extract concessions, obstruct maintenance or postpone investments whose benefits arrive slowly.
I accept these as substantive risks. Lower present bills and dependable investment also serve the affected public. A philosophy that preserves elaborate procedures while making essential provision unaffordable would undermine its own purpose. Revision capacity must therefore pass a proportionality test, including an explicit assessment of who pays.
The safeguard should match the arrangement’s necessity, concentration of power, potential harm and difficulty of reversal. A modest shared facility might need accessible accounts, periodic member review and outside mediation. A regional monopoly might justify a protected analytical budget and more formal representation. The least burdensome mechanism that secures effective standing should be preferred, with costs themselves open to review.
Predictable procedures can protect investment without guaranteeing permanent rule. Review intervals, evidence requirements, proposal thresholds and decision deadlines should be known in advance. Ordinary operations should continue during review. Exceptional reopening should require stated grounds, while emergency powers should be limited and subsequently examined. Stability can rest on confidence in the procedure for change.
Reciprocal rights are equally necessary. Workers deserve protection against retaliation; owners and creditors deserve due process and respect for lawful claims. Residents cannot demand cheap services by transferring pollution downstream. Majorities cannot extinguish minorities’ basic rights. Structural change should allocate transition costs fairly and provide compensation where justified, rather than treating past investment as either a permanent veto or worthless.
The independent reviewer also needs accountability. Published appointments, transparent budgets, conflict disclosures, contestable membership decisions and external appeal can reduce capture. Independence means freedom from the incumbent’s unilateral control; it does not mean freedom from scrutiny. If the reviewer becomes an unchallengeable ruler, the same objection applies to it.
Prosperity as a reason to continue
Returning to January 2010, I would distinguish restoring economic activity from settling who may direct its future. Recovery can make existing institutions worth retaining. It can also make people reluctant to question them. Neither gratitude nor fear should determine whether the practical means of reconsideration survive.
For me, Reauthorism begins with a limited but demanding commitment: people substantially dependent on essential economic arrangements should retain protected means to examine and reshape them together, within reciprocal rights. They need not continually exercise that capacity. They may entrust specialists with extensive discretion and reaffirm the same arrangements repeatedly.
Prosperity strengthens the case for continuation when people can assess it, compare alternatives and make that continuation their considered decision. The institution’s achievement then remains a reason offered to an affected public whose authority is still alive. It does not become a title to determine their economic future permanently.
Sources
Dates below identify original publication, not the later digitisation or hosting of online copies.
- Peter Dattels and Laura Kodres, IMF Monetary and Capital Markets Department, “Global Financial System Shows Signs of Recovery, IMF Says”. 30 September 2009. Contemporary context on stabilisation, remaining risks and public exposure.
- John Dewey, The Public and Its Problems. 1927. Especially Chapters I and V on affected publics, inquiry and communication.
- Albert O. Hirschman, Exit, Voice, and Loyalty: Responses to Decline in Firms, Organizations, and States. Harvard University Press, 1970. Especially Chapters 2–3; linked scholarly edition lists contents and may require institutional access.
- Elinor Ostrom, Governing the Commons: The Evolution of Institutions for Collective Action. Cambridge University Press, 30 November 1990. Especially Chapters 3–5 on enduring governance, institutional change and failures.
- F. A. Hayek, “The Use of Knowledge in Society”. American Economic Review, 35(4), 519–530, September 1945. Primary text on dispersed knowledge and economic coordination.