This paper develops the theory of entangled political economy by outlining a process by which the political-economic order can become increasingly entangled. The theory posits that a Big Player polity organization, a key feature of which is a lack of a hard budget constraint, exports this feature to the economy organizations it oversees. The channel through which it does so is the repeated interactions of economy and polity organizations' agents during times of crisis. The actions of the Federal Reserve, in particular its bailing out of large financial houses in the latter part of die 20th century and the most recent financial crisis, are used as a historical illustration of this theory. The paper also discusses die possibility of constitutional craftsmanship as a solution to the undesirable consequences that accompany increased economy-polity entanglement.
What is self-governance, and under what sets of institutions is it possible? This article explores this question from the perspective of informal (de facto) constitutionalism. The dominant approach, grounded in formal constitutionalism, overlooks crucial institutional features that determine whether governance is something done by individuals to themselves, as opposed to something done by some individuals to others. Understanding self-governance requires not only identifying the durable procedures for public decision-making, but also appreciating how these procedures act as filters that select for the acquisition of political power by individuals with specific and predictable characteristics. The article develops a novel constitutional typology based on the structure of political property rights, on the one hand, and the kinds of individuals that govern, on the other, and use this typology to discover the types of polities most likely to be self-governing.
Most liberal constitutional theorising, as exemplified by Buchanan (1975) and Rawls (1971), operates with a two-level scheme of analysis. The first level entails agreement on the rules through which a polity is constituted; the second level entails self-interested action inside that framework of rules. Within this framework a polity is constituted through agreement on the rules that frame political action. In this paper, we explore how this scheme of analysis might be relaxed by recognising that acquiescence is not agreement. Hence, people can acquiesce in some framework of governance without truly accepting it. In this alternative framework, agreement on rules is always incomplete, for two sets of reasons. One is the limited and divided quality of knowledge (Hayek, 1937; 1945). The other is the persistent presence of antagonism within society, as conveyed by Carl Schmitt's (1932) distinction between friends and enemies, and with that distinction present as well in William Riker's (1962) theory of political coalitions.