Alastair Darling, the UK’s Chancellor of the Exchequer suggested something laudable, and unusual, and despicable, yesterday. He suggested that legislators should not pass laws that are unenforceable. That is laudable, because we can all agree that a law that cannot be enforced is merely oppressive, and serves no good purpose. It is unusual because legislators rarely concern themselves with enforcement. They often pass laws which could never be properly enforced, simply to make it seem like they are taking action and appeasing the public. And it is despicable because he used the argument to justify not taking action in a situation where action clearly is possible: restricting financial rewards that people receive for the work they do. Darling is a mainstay of a UK government that has had no problem whatsoever with interfering with how much financial reward people receive from work. It has done it time and again, for reasons that vary from pretty reasonable to pretty terrible. Examples include mandatory minimum wages, increased income taxes and laws to prevent discrimination in pay. So this government has no problem trying to determine how much people should earn, and seeking to enforce it. Enforcing a rule that says someone should not be paid too little is just the mirror of enforcing a rule that says someone should not be paid too much. It you survey and inspect and find people paid too little, you can survey and inspect and find people paid too much. Yet Alastair Darling defends inaction based on the supposition that there is now a super-elite, who cannot be controlled by the government in the way that government controls the rest of society. If you want to join this super-elite who sit above the law, do not become a terrorist, or a cop or an even an MP. Terrorists and cops and MPs all get subjected to laws they do not like, at least sometimes. Darling has clarified the legal status of some in our society: to sit above the law, in a place where law cannot reach you or curb your dangerous and selfish actions, you should become a city banker.
In short, Darling argues that laws to cap bonuses for bankers are unenforceable because of two factors. The first is that bankers are clever, and powerful, and resourceful, and they will work around any law to find a way out of it. Of course they will try, but the fact that people try to work around laws does not mean the government gives up trying to pass laws. There are a myriad of laws relating to tax, and a myriad of schemes to work around them, and yet recognizing that people have the incentive to work around those laws has never been a reason for governments to give up on taxing people. In the UK, powers are misused to spy on people for petty offences. Powers supposedly introduced to prevent terrorism have mostly been used to stop people putting their bins out at the wrong time. However, Darling seems inexplicably squeamish about using similarly strongarm tactics to police bankers, even though reckless gambling within the world’s financial system is of more harm to society than disposing of household waste in an inconsiderate manner. Have recent events not shown that bankers can do more damage to our society than any terrorist could ever hope to? If we can live in a society that spies on people to enforce laws about bins, I see no reason to then protect the freedoms of city bankers intent on evading any law designed to prevent excessive bonuses.
Darling’s second explanation for the unenforceability of a banker’s bonus cap is that bankers are mobile chappies, and will simply move around to the country with the least restrictive laws. That is true, so any action needs to be global. It needs to be global just like the UK government is acting forcefully for global consensus about tax evasion. It needs to be global just like the UK government is acting forcefully for global consensus about money laundering. If the UK government can be proactive in these spheres, why does it assume global consensus is impossible for bankers’ remuneration? They ride the same international streams of money as the people who evade taxes, or the people who launder ill-gotten gains. Let us imagine the next private conversation Darling has with Charles Anarché, the tinpot dictator of a (fictional) place known as Libretaxville:
Darling: (furious) This is outrageous! You hide money launderers and you hide tax evaders? And all to profit from the money they bring to your ridiculous little country. You’re destroying the hope of international consensus and international policing of crimes that hurt all of humanity! How can you do such a thing? How can you be so selfish?
Anarché: (pleading) I want to change the law, I really do. But I cannot. If I change the law, then all the money launderers and tax evaders will move to Taxfreistadt, the place ruled by my cousin, Denzil De Catastrophe.
Darling: I don’t see how you can even want such people in your country.
Anarché: Come, come. We want them because they have money. My country is poor. We have very little industry. Our wealth depends on this small number of rich people who live and work here.
Darling: But can’t you see, arguing that they would go somewhere else is just an excuse not to do anything? It is an excuse to keep on profiting by harbouring these people.
Anarché: Of course it is an excuse, and a very good excuse. If anyone should profit from having these people around, I should profit… I mean my country should profit from having them around. Any country that does not give safe haven to these cheats is just hurting themselves.
Darling: But the world would be so much fairer if all governments pulled in the same direction, and cooperated, instead of being held to ransom by petty little regimes like yours.
Anarché: And yours.
Darling: I beg your pardon?
Anarché: And yours. I am referring to bankers who decimate our economy because of the rewards they get for taking enormous risks. We are not a rich country who can borrow our way out of trouble, like you do in the UK. When the bankers lose, we lose. When people stop buying our exports, my people go without. Unlike the bankers, we do not have a huge pile of money and assets to cushion the fall. When our economy falls, my people hit the ground hard.
Darling: But you can’t stop bonuses for bankers on your own. You need international cooperation for that, and you will never get it.
Anarché: Exactly, Darling. Exactly.
What appalled me about Darling’s rationalization for inaction was that there are so very many laws that are unenforceable, and yet enforceability is rarely stated as a reason not to pass a new law. To demonstrate, here is my personal top five of unenforceable laws.
1. Data Protection
Somebody in government passes a law that says your personal data will be held securely, will not be held excessively, will be treated with respect blah blah. Of course, nobody actually polices this law. Everyone is supposed to abide by it, but the only way of being caught doing wrong is to do something so grossly stupid that either the victim finds out or there is a national scandal in the press. Hence even the government regularly breaks its own laws with its sloppy handling of citizen’s personal data. In short, the only major impact of data protection law has been the proliferation of legalese that people are supposed to read before they waive the wafer-thin rights granted by laws that are unenforceable anyway.
2. The Working Time Directive
This is my experience of the Working Time Directive, the European rule that is meant to protect workers from regularly working more than 48 hours a week.
You may be aware that under the Working Time Regulations average working hours should not exceed 48 per week over a reference period of 17 weeks. It is expected that few people will work in excess of these hours over the course of a year, but some staff may be expected to work in excess of these hours on a short-term basis when necessary. Express consent will be sought for any adjustment to your working hours should they exceed the limits contained in the new regulations.
The point of this memo is that if you work less than 48 hours on average, then there is no problem, and if you work more than the hours on average, you need to sign a piece of paper and give express consent that says you want to do that. Note the absence of a third option – to not work more than 48 hours on average. Imagine anybody trying to insist on their rights in a workplace where HR has this mentality. Then imagine people who want to be stuck in a dead-end job, with no prospects of promotion or pay rises, and every likelihood of being first on the list of any redundancies. Thank the UK government for making sure the Working Time Directive was unenforceable: they pushed hard for the ‘flexibility’ of allowing workers to ‘opt-out’. If no opt-out had been permitted, as other European countries wanted, then there would have been a chance to enforce it, but not when it is easier to simply bully workers into signing away their supposed rights.
3. Taxes on Illegal Drugs
Illegal drugs are, well, illegal. People are not supposed to have them, buy them, sell them or take them. Yet some US states expect people to pay taxes on illegal drugs. For example, Tennessee’s Unauthorized Substances Tax requires anyone in possession of a certain quantity of contraband to buy a tax stamp and affix it to the drug. Not surprisingly, most people who break the law by having illegal drugs also break the law by not paying their taxes. Which is the point – to use tax as a back-door mechanism that allows the state to profit from illegal activities. This law is not so much unenforceable, as a way of legitimizing greedy governments that want to earn a profit every time a criminal is caught. They should be more concerned with the fact that by doing so, they also join the ranks of those profiting from the manufacture and supply of drugs. Legalize it or tax it, but doing both is morally indefensible.
4. War Crimes
It is an appealing idea that there is a pan-national law that sits above all, disembodied from any force or agency responsible for enforcing it. It is appealing, but a fiction. Laws have to be enforced by somebody, and invariably that somebody has power over the person on the receiving end of the punishment. That is why war crimes are by and large targeted at two kinds of offender: people on the losing side, of any rank; and people on the winning side, of low rank. The worst possible offender is neither a person of low rank nor a person on the losing side. The worst possible offender would be someone on the winning side in a position of high authority. They have authority, hence they can be the driving force behind the most large scale crimes. They were on the winning side, the side with the greater power to do more harm than the enemy, and hence the side with the potential to commit more crime. The greatest war criminals are unlikely to be discovered, never mind tried, never mind punished. Whilst it is good to see bad people punished for atrocities, we would be wise to keep in mind that punishment depends on power, and people in power are not subject to laws like everyone else, whether they are bankers or warmongers.
5. ‘Terrorist’ Hackers
Governments do not want bad people hacking its secure computers. Sensible solution: make sure the computers really are secure. Stupid solution: punish people you catch hacking your secure computers that turned out not to be so secure after all. If a government wants to punish any really serious hackers, people like organized criminals, terrorists and agents of foreign governments, they will find that all of them are working in places where they cannot, or will not be extradited from. That is because they are serious people, and either are hidden in lawless states or protected by enemy states. The only kind of terrorist who can be caught by a law like this is the kind that sits in a bedroom in an allied nation with an extradition treaty, looking for evidence of UFOs, because of the obsessive aspects of his personality. And that is why Gary McKinnon is the closest the US government will get to using unenforceable laws like this against a terrorist. This law is not about stopping terrorists, though it is about acting tough when ‘national security’ was shown to be anything but secure.
To summarize, let us clarify what governments think they can enforce. Governments think they can enforce laws to stop you being worked to death, but do not discourage your employer from using any and every legal means imaginable to encourage you to work yourself to death. Governments think they can enforce laws to generate tax revenues from criminal activities that they struggle to prevent, and do so without any sense of irony. Presumably they even budget for the revenues and would hence boast about the healthy state of their finances if crime went up. Governments think they can enforce laws to stop nasty terrorists hacking computers important to national security, so long as the nasty terrorists are actually lone individuals who live in a suburban house in a peaceful law-abiding nation. Governments think they can protect your personal data, by insisting that everybody using your personal data does only good things with it, without needing to make the most meagre attempt to police these laws. Remember that these were the same governments that could not adequately police their own data on their own computers and stop them from being hacked. These are also the same governments that regularly lose the personal data of millions of citizens as a consequence of penny-pinching, incompetence and carelessness. Governments even pretend to enforce laws against themselves, an idea as laughable as expecting Gordon Brown to punch himself in the face every time he makes a bad decision (although, at times, Brown looks so beaten you could almost imagine he does). Observe how hard the UK government tried to wriggle out of its own laws to hide the reprehensible but petty abuse of MP’s expenses. Now imagine how hard they would work to hide something really serious, like lies about wars.
Now we should summarize what governments supposedly cannot enforce. They cannot enforce laws that would discourage individuals from being rewarded for taking enormous risks which could lead to the destruction of the global economic system and hence plunge the world into ruin. That is enough to make you wonder why we need governments at all.