I'm a bit tardy getting this post up, but this may be a good time to discuss this topic, being at a midpoint between the 12th anniversary of the start of the Rwandan genoicde and the Christian celebration of the resurrection of Christ. Both events deal with forgiveness -- one representing the need for it and the other representing the way.Professor Pete Boettke gave a presentation on March 28th here at GMU on the “Economics of Forgiveness”. His paper, co-authored with Chris Coyne, specifically addresses the situation of nations transitioning out of oppressive regimes.
Here’s the abstract:
Dr. Boettke’s thesis is that there is a point at which the pursuit of justice ends up harming, rather than helping a nation coming out of an oppressive situation. (Benefits become less than the costs.) While this might at first-glance seem counter-productive to our moral intuitions, Boettke makes a very strong case to support this. Some of highlights of this include:
The turn of the century witnessed the emergence of several new democracies wrestling with the past of oppressive state regimes that committed atrocities on their own citizens. In East and Central Europe, the former Soviet Union, Latin America, South Africa, and the Middle East, new governments and their citizens are determining precisely how to balance past and present. In the mid-20th century, Germany and Japan had to negotiate a similar political terrain. Our paper is focused on past injustices perpetrated by totalitarian regimes and using basic economic reasoning we attempt to clear a path for reconciliation and thus hope for a future of peace and prosperity.
- Demands for retribution can bankrupt the future, sometimes leading to financial claims that exceed GDP of an economy.
- A point can be reached where the cost of justice outweighs its benefits.
- Demands for retribution lead a nation into thinking in terms of the past rather than the future. Without a future orientation, the nation will never move forward.
- The debt for past deeds colors all social relations, if they are not forgiven.
- Everyone living today could find ancestors who were victims of some type of injustice.
- As temporal distance becomes greater, demands for justice must become weaker.
- Individuals operating under an oppressive regime often have to conform to the regime’s operations in order to survive and have very little ability to dissent. It is often very difficult to gauge the guilt of an individual’s actions under such conditions.
- Human capital (skills, knowledge, trust, contacts, local knowledge, etc.) is typically tied up in the former rulers of that regime. To eliminate all of those people could decimate attempts at transitioning into a free nation. (Post-war rebuilding of Japan took this into consideration. Post-war de-Baathification in Iraq did not.) Eliminating the former rulers of a regime from the future of the country also gives added incentives for those rulers to resist and disrupt transition processes.
No nation can transition into a free economy without first credibly signaling a strong commitment to the rule of law, rather than the rule of man. One of the first steps in this process is to prevent ex post facto law (retroactive laws) from being passed. Most developed nations prevent this kind of law from being passed either constitutionally or procedurally. (See the US Constitution Article I, Section 9, Clause 3.)
If one of the major problems with the totalitarian regime were intrusive and aggressive activities that violated the rights of its citizens, and the desire in the post-totalitarian moment is to establish a government constrained by the rule of law, then rectification measures that violate liberal principles of due process and rule of law must be rejected. As Jon Elster (2004:83) has put it:When they set out to deal with the lawless practices of the past, they do not want to do it in a lawless manner. Their desire to demarcate themselves from the old regime may constrain, however, the satisvaction of their desire to punish the agents of the regime. It may be impossible, for instance, to punish what appears to be obvious acts of wrongdoing without introducing retroactive legislation, thus embracing the lawless practices of the previous regimes.In short, since the totalitarian regime was not violating laws at the time of their actions, they cannot be subject ot the laws established during and after the transition. Further, retroactive laws violate the rule of law because no individual would ever be able to predict how laws would affect them or what actions should be avoided so as not to violate future retroactive laws (Hayek 1978: Chapter 14).
I also think the human capital argument is incredibly strong. A great example of this would be the Haitians killing off most of the white people as the slaves took over the nation, destroying the majority of the knowledge base of the nation along with them:
The tragic consequences of these actions haunt the nation to this day. What was done in an attempt to exact justice ended up crippling a nation for over two centuries. As Dr. Boettke said, our moral intuition often leads us awry.
The carnage that the slaves wreaked in northern settlements, such as Acul, Limbé, Flaville, and Le Normand, revealed the simmering fury of an oppressed people. The bands of slaves slaughtered every white person they encountered. As their standard, they carried a pike with the carcass of an impaled white baby. Accounts of the rebellion describe widespread torching of property, fields, factories, and anything else that belonged to, or served, slaveholders. The inferno is said to have burned almost continuously for months.
The thrust of this paper can best be summed up by this diagram:
(click for larger image)
The x-axis represents the percentage of an oppressive regime prosecuted and the y-axis shows the probability of being able to establish a new regime based on the principles of liberty. Notice that *P is the point at which yields the maximum possibility of success at setting-up a new liberal regime. This point does not coincide with the maximum number of prosecutions of old regime members, nor approach anywhere near that maximum. Prosecutions carried out beyond *P end up damaging the future welfare of the nation.
This is a powerful concept that can be broadly applied. While it is hard to think of concrete empirical evidence to “prove” this model, it seems to “fit” what I understand about the history of atrocities around the world.
Pete Boettke and Chris Coyne are to be commended for adding to our understanding about political and economic ramifications of the power of forgiveness and for giving us a conceptual model for thinking about how this can be applied in understanding real-world settings. I am currently researching the “economics of reconciliation”, particularly how it applies to African nations. Boettke’s and Coyne’s paper has greatly added to my understanding of these issues.
Download a draft of this paper here. (This is an earlier draft of the paper than the one we received. I’ll try to track down a link to a more recent copy.) Also see related papers by Tyler Cowen here and here.
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