Monday, May 27, 2013
This is the eleventh in a series of posts reviewing Margaret Jane Radin's Boilerplate: The Fine Print, Vanishing Rights and the Rule of Law.
Professor Radin’s Boilerplate is a pragmatist repudiation of an important social and legal phenomenon. That practice has a number of features: (1) waivers of rights and liability contained in boilerplate are often unknown to the individuals who grant those waivers (2) consumers need to waive common law and statutory rights in order to purchase a wide range of goods and services, many of which are regarded as essential to ordinary American life (3) the waivers in boilerplate govern so many contractual relationships that some rights otherwise granted by law are effectively eliminated for large portions of the consumer population.
Much of the literature on boilerplate focuses on the first feature of boilerplate, above. Radin has an argument about normative degradation and the poor quality of consent to boilerplate. But I think the most important contribution of the book is to highlight features (2) and (3).
The fact that consumers need to waive many rights, including the right to compensation for harm incurred by the negligence of others and the right to pursue legal remedies in courts or by way of class actions, is not important because it renders their consent ineffective. (I would argue it does not.) The fact of necessity is important because it explains feature (3) and suggests that the mass “rights deletion” that Radin observes does not necessarily reflect consumers’ collective preferences.
Whether consumers prefer contracts with or without boilerplate, i.e., whether they are prepared to pay to preserve some rights now usually waived in consumer contracts, depends on the decision mechanism by which that preference is expressed. Because many rights that private individuals have against one another are default rights that individuals are free to alienate, we effectively use the market to sort consumer preferences. The result is that individual consumers decide whether, on the margin, the value they might derive from a legal right is worth the money they save from giving it up, or whether it is worth the value of the good or service to which that waiver is attached.
The deep question that Radin raises in her discussion of democratic degradation is whether markets are indeed the right way to decide the scope of some legal rights. Especially where the frequency or distribution of a right in society has important cumulative effects on legal culture or social practice, we might wish to remove certain rights from the marketplace and decide through collectivized decision-making (i.e., legislative action or inaction) the scope of rights that govern certain private interactions. One of her most compelling examples is the case of copyrights that individuals frequently waive. She persuasively observes that we may have a collective interest in the wide diffusion of copyrights that is underserved by the separate decisions of millions of individuals to waive their copyrights at a small price.
More generally, we need to think about what proportion of our private rights (rights held against other private individuals) should depend on our market power. The idea of a “social wage” refers to the proportion of our material resources that depends on our status as citizens -- as opposed to our market wage, which is the proportion of our income that turns on our performance in the marketplace. Countries differ in their social wage level. For example, countries with national health care or generous unemployment benefits make your material situation somewhat less dependent on your labor market position than in countries without public health care or generous unemployment benefits. The United States has a low social wage as compared to other developed countries of comparable wealth. We probably also have a “low private rights” regime, inasmuch as individuals vary (more than elsewhere) in their ability to preserve legal rights depending on their ability to pay for them. I imagine that whether this outcome is acceptable turns significantly on the particular right at issue. For example, we might reject a regime under which service providers exercise greater caution to avoid bodily injury when dealing with some consumers than with others. Yet we might be comfortable with a regime in which some proportion of the population relies primarily on arbitration for redress. We can thank Radin for highlighting these important social choices.
[Posted, on Aditi Bagchi's behalf, by JT]