This part of the book could be called a stylized history of institutional development of Western Europe and Russia, although this expression is rarely used in Russian. The Russian Wikipedia translates it as ‘simplistic generalization of empirical results’. However, I believe that this word is a very good expression of the necessary meaning. Defining the genre of this part of the book, it should be said that I do not tell a history, and if such impression emerges, it is not quite correct. It describes the models that will be presented in the historical sequence of their alleged prototypes. This is how I and/or the authors of the quoted books understand the social and institutional set-ups in the past. The word model is considered as synonymous to Max Weber’s concept of ideal type, and – though with some reservations – to the word paradigm. So our goal here is not of historical nature, it is to justify and illustrate our theoretical constructions and finally to understand what is happening in society today.
Institution is a word borrowed from the law, which means ‘an establishment’. Here is what Wikipedia says:
Institution is a social structure or order of the social system that determines the behavior of a set of individuals of a particular community.
Of course, this word is familiar to everyone, but, nevertheless, there is a very great disparity in its use. Here in this part of the book, we will not try to achieve greater clarity on this issue; hopefully its meaning is quite clear from the context.
Let us also note that there are several possible lines of reasoning about institutions. One is historical, when institutions are considered within the overall context of life at the moment. In this case, the object of study is a pattern of behavior which is experiencing all sorts of influences: geographical, economic or of any other nature, and which itself, in turn, affects the economic situation, policy, etc. For example, the New Economic Policy (NEP) in the USSR in the 1920s was the result of certain events, and at the same time it was an institution. Discussing the institutions this way, we will be talking in everyday language, that is, in terms that people actually were using at their times. Another way of discussion can be called purely logical, and it is completely focused on the question of what is an internal construction of the institution in question. In this case we have to get diverted from the particular circumstances of time and to some extent adjust the data to the logic. Finally, a third task may be put forward which consists of trying to integrate a lot of interesting things from various disciplines - linguistics, philosophy, science, psychology - which might help thinking about the institutional problems. This is what the first part of this book is about. Thus, there are three angles, which we try to connect here to look at the issue of institutions from different sides.
As already mentioned in the introduction, the book - and especially this part - is made in the form of a collage. About two dozen works are retold and/or given in the form of short excerpts, which in the aggregate, in my opinion, create a multi-dimensional picture of the institutional development of Western Europe and Russia. Most of these works are quite well known, some are even famous, but all without exception are very interesting. In this case, the authors cited are not historians who work with primary sources and primary data. We will deal, as economists say, with a product of the second or third ‘reprocessing’, i.e. with generalized information, with paintings done with ‘broad strokes’. Certainly, the course of the presentation will ask for some comments, but still one need to keep in mind that by and large the discussion of the material of this part of the book are its other parts.
Contents of Part II
Chapter 4. The key stages of the Western Europe’s institutional development
Why the West grew rich?
Pope’s revolution of the XI-XII centuries
Military revolution of the XVI-XVII centuries
Reformation and the spirit of capitalism
National state and mass society
Chapter 5. Institutional development of Russia
5.1. Russia before the revolution
Vikings till Moscow Princedom
Moscow Tsardom and the military revolution
Intelligentsia and revolution
Contradictions of the New Economic Policy
‘Socialism with human face’
Collapse of an empire
5.3. Contemporary Russia
Evolution of the Soviet institutions
‘The genius of the authorities’
Middle class and its future
Part III. ‘The West’ and ‘Russia’: models of social order
As Boris Groys wrote24, the problem of ‘Russia and the West’ is central to the Russian philosophical tradition, but the terms ‘Russia’ and ‘West’ do not have any geographical, political or sociological meaning:
Rather, they are ciphers to refer to the fundamental philosophical question of the universality of thought and culture. The term "West" here refers to the focus on a universal, generally binding, rational truth beyond any differences in cultural life and practice. The term "Russia" refers to the impossibility of such a truth and therefore to the need to seek solutions not at the level of thinking, but at the level of life itself.
To put it mildly, Groys gives this quest fairly low opinion:
At least as long ago as since the time of Chaadaev, the Russian thought – having to deal with the issue of the national identity, independence and originality, and at the same time not being able to produce anything really exotic and heterogeneous compared with the Western culture, has been persistently answering this question by interpreting Russia as a place of realization or materialization of the Western discourses about the Other. The historically developed forms of Russian life were usually subjected to criticism, with the true Russia being placed either in the prehistoric past, or in a utopian future, both being modeled after the corresponding Western theories of the Other. These theories were transformed so as to deprive them of their negative purely critical nature and thus to theologize the Other, or at least to give the Other positive and affirmative color. At the same time, we see here only a very early version of the strategy which has been used during XIX-XX centuries by many historically unsuccessful national cultures or social subcultures in order to simulate their own cultural identity and originality through appropriation of various discourses about the Other.
This is difficult to disagree. Numerous attempts - starting from the Slavophiles - to ‘make a virtue of necessity’ (as the Russian saying goes) can not but make one feel disappointed. However, many questions remain. Why indeed, because of what specifics we can not ‘produce anything really exotic and heterogeneous’? Or, conversely, in cases when it turns out to be possible, - because of what circumstances? Why is Russian culture labeled for its known inability to create forms? For the inability of reflection amounting to aphasia25?
However we will start with the question of how we understand the social mechanisms of ‘the West’. Because it seems to me that the real European West is the result of what might be called an institutional invention. I believe that a specific and unique technique of social and cognitive organization appeared there at some moment which became the foundation of its success.
Chapter 6. Liberal social order
Drawing a model of ‘the West’, we will consider as a starting point Hayek’s ‘theoretical world’, i.e. his picture of the liberal social order, and will complement it with those aspects which Hayek himself did not consider it necessary to stress, or which were not too relevant in his time.
For simplicity, further we take the quotation marks from the word ‘West’. Still, it should be kept in mind that what we speak about is only a model or an ideal type. First of all, it is not clear what this model describes in a geographical sense. Secondly, this model describes only ‘half’ of the relations that can be observed in the real societies of ‘the Western’ type. Moreover, Hayek obviously used this model with the special polemical purpose in order to counterpose the set of liberal-type relationships which are based on the idea of freedom to another ‘democratic’ complex of relationships which are based on the idea of equality. Finally, we note that in speaking of ‘the liberal social order’, Hayek calls it spontaneous. Meanwhile, a key question is whether it is enough to adhere to the laissez-faire principle to have such an order emerging ‘by itself’, i.e. spontaneously? Or is the liberal social order (rule of law, system of modernity, and other close phenomena) a great invention of mankind as is, say, the wheel. As is well known, the high native civilizations of America did without wheels. We can as well suppose that the liberal order ‘does not grow by itself’ and should be the subject of transplantation.
Liberal order as a reflexive sign system
The main feature of the liberal order is that it is based on a signs system, which allows further creation of entirely new sign systems. To use the Popper’s words, it is an open society. However, the newly created systems can not be completely arbitrary, they retain their original grammatical properties.
Individuals and their ‘territories’
Hayek’s ‘theoretical world’ is inhabited by individuals who generate ideas and innovations. These ideas (ideal objects) are then separated from the individuals who have produced them and are turned into objectively existing things. The classics noticed long ago that social ties in the liberal order (‘under capitalism’) are ‘alienated’ from individuals to be mediated by things.
Individuals are absolutely free to act, however not always, but only within their territory – or, to use Hayek’s own terms – within the limits of the individuals’ private domains. Here there may be various other synonyms: such an area can be called an individual’s sphere of competence; or the set of his rights. In any case, the scope of an individual’s competences is formulated in negative terms such as negative rights; they establish prohibition against any interference in the affairs of another individual which belong to his ‘territory’.
Here is how the issue is treated by the English-language Wikipedia 26:
Philosophers and political scientists make a distinction between negative and positive rights (not to be confused with the distinction between negative and positive liberties). According to this view, positive rights usually oblige action, whereas negative rights usually oblige inaction. These obligations may be of either a legal or moral character.
Thus ‘reality’ is divided into ‘territories’, which are delineated by the sets of rights of each of the individuals. These sets of rights are elements of a sign system.
Grammatical ‘Rules of Just Conduct’
Thus, the interaction of individuals in the liberal order is possible only on a voluntary reciprocal basis. Since, therefore, there is a ban on the intervention of one individual in the affairs of another, the set of rights of any particular individual at any given moment is made up solely as a result of voluntary exchanges with other individuals (either by unilateral transactions such as gift or inheritance) .
The general framework for such voluntary exchanges is provided by the laws which never can be addressed to somebody in particular but are equally relevant to any individual. Hayek calls them the ‘rules of just conduct’, bearing in mind that these laws are formulated in terms of negative rights of individuals to prohibit interference with the other person’s ‘territory’.
These rules are the grammar of the system, they make it possible to use the elementary units (rights) to build units of the upper levels: contracts, legal entities, etc.
Law is the foundation of the liberal order as a sign system. It makes possible a reliable and consistent connections between the signs and reality.
As an illustration, we quote here the words of Harold Berman who was explaining the functions of law to his students of the humanities:
(T)he place of law in our society – that is, in the Western tradition of thought and action – is unique. The West has exalted law as a fundamental basis of unity in society. Belief in the existence of a “fundamental law,” to which governments must adhere or risk overthrow as despotisms, has been characteristic of European thought at least since the eleventh century. This belief finds expression in the English concept of the Rule of Law as well as in the German idea of the Rechtsstaat, not to mention the American Constitutional requirement of due process of law. It is a belief which has been challenged in modern times most strikingly by totalitarian systems, but also by some currents of democratic jurisprudence.
The role of ‘professions’
The mechanism of maintenance and development of the sign system - which is used for individuals’ interaction and transaction through exchanging or delegating rights - is separated from it and allocated to a separate subsystem (or metasystem). This metasystem of ‘perpendicular’ to the market: ‘lay’ individuals do not have the capacity (locally, at the moment of their transaction) to influence the language and the rules that allow and restrict their actions.
It is the (meta)system of law whose business is to develop the conceptual toolkit. The fact that an individual (whether belonging to this professional community or not) in any given case did remained within the limits of his rights (his competence) or trespassed these limits and committed an act of violation – this fact is established by representatives of the professional community and according to the rules provided by this community. It is the judge who makes the judgment27.
Still, the law is not equal to the community of lawyers. It is a holistic cognitive system, an organism that lives its own life. In the model of ‘liberal social order’ laws are not passed but discovered as some objective regularities which have always existed but remained unknown until some moment in time. And this discovery is done primarily by judges and lawyers, not legislators.
In this connection, it must be said that law is the main but not the only professional system of the West, and that its main features are repeated in science, medicine, and other fields. Historically these features first were developed in the Middle Ages by the Catholic Church. The main organizing principle is that a given sign system is produced by a special professional community (lawyers, scientists, doctors) through an open, clearly understandable and reproducible discussion where only members of the community are allowed to take part and which cannot be addressed to the ‘lay’ non-members.
Comparing the social mechanisms of professions with the market and the bureaucracy, one can see their differences with both, and speak about the third mechanism. A judge, a doctor, a university professor are not built into a system of bureaucratic subordination. On the other hand, a physician’s relationships with his patient or a professor’s with his student are not of the market type because neither the patient nor the student can be competent to judge the quality of services provided by the doctor or the professor. Quality in this case is mediated by the mechanisms of socialization and control within the profession, which acts as a whole unit in relation to the society. Similarly, the discussion of scientific theories is confined to the community of scientists, and an appeal to the authorities or to the general public is rightly condemned as ‘Lysenkoism’.
Procedures of individual decision making
Let us consider now the issue of an individual’s interaction with his ‘territory’, i.e. of his assigned piece of ‘reality’. Negative rights ensure that nobody can intervene with this individual’s decision how to dispose of his belonging resources. But the question is, will he have the strength to overcome the resistance of the resources themselves, the resistance of the objective laws of nature?
This kind of question gives start to the theme which runs through the whole period of development of the sign system of social organization in Western Europe. This is the theme of the man's power over nature. Developing the techniques of prediction and control of nature, the technology of individual implementation - logical conclusion, empirical testing, and experiment - has been of crucial importance. Francis Bacon’s words that ‘The knowledge itself is power’ manifest the role these techniques play in the modern times. It is by using these techniques of ‘consultation with the objective reality’ that a person can make decisions and implement his ideas without asking for the consensus and support of others. These techniques are a cornerstone of the liberal social order which makes possible individualism and freedom.
Universal context: transparency vs. corruption
The liberal order has a critical feature: it is expected that all the concepts retain their meaning regardless of the situation. Accordingly, the laws and ethical standards are the same for everybody, the facts may be, in principle, always examined and either confirmed or disproved, agreements must be complied with, etc. The general concept, which in modern language embraces the whole range of these approaches is transparency.
For illustration, here is a quote from the well-known book The Rising Sun by Michael Crichton28:
“The son of a bitch,” I said. We were driving west on the Santa Monica freeway. “The little prick looked us right in the eye and lied.”
“It’s annoying,” Connor said. “But you see, Ishiguro takes a different view. Now that he is beside the mayor, he sees himself in another context, with another set of obligations and requirements for his behavior. Since he is sensitive to context, he’s able to act differently, with no reference to his earlier behavior. To us, he seems like a different person. But Ishiguro feels he’s just being appropriate.”
“What burns me is he acted so confident.”
“Of course he did,” Connor said. “And he would be quite surprised to learn that you’re angry with him. You consider him immoral. He considers you naive. Because for a Japanese, consistent behavior is not possible. A Japanese becomes a different person around people of different rank. He becomes a different person when he moves through different rooms of his own house.”
“Yeah,” I said. “That’s fine, but the fact is he’s a lying son of a bitch.”
Connor looked at me. “Would you talk that way to your mother?”
“Of course not.”
“So you change according to context, too,” Connor said. “The fact is we all do. It’s just that Americans believe there is some core of individuality that doesn’t change from one moment to the next. And the Japanese believe context rules everything.”
“It sounds to me,” I said, “like an excuse for lying.”
“He doesn’t see it as lying.”
“But that’s what it is.”
Connor shrugged. “Only from your point of view, k. Not from his.”
So much interesting that we find exactly the same idea in Bakhtin’s book on Dostoevsky. The principal specifics of this writer’s method is that his characters are not bearers of some objectively existing properties or ideas, they are full-fledged personalities who cooperate in the creation of life and manifest themselves through interaction with others and with the world at large. This approach Bakhtin calls dialogic contrasting it with the monologic world of uniform contexts and objectively existing ideas (…) In this sense, the liberal order belongs to the monologue world.
Corruption destroys a uniform context; it breaks the connection between the sign and its meaning. An example of this would be the case when the contractor goes beyond his sphere of competence, does not adhere to the project of the architect, and ‘puts his soul into it’ and - perhaps with the best of intentions – thus distorting the project. This person commits an acts for which he is not entitled.
Still, commonly the word corruption is used for a slightly different behavior, namely the use of one’s rights for inappropriate purposes, often for personal gain. But strictly speaking, corruption is a special case of violation of the principle of separation of competencies.
It should be noted that societies based on sign systems and on the principle of semiotic organization are characterized by a much more painful and strong reaction to corruption than the ‘network’ societies. This is not surprising, since corruption problems lead here to serious system-wide implications.