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No, law does not necessarily lag behind technological development. No, smart technologies are not destined to lead the road to either freedom or surveillance. Determinisms of any kind are not what make Julie E. Cohen’s Between Truth and Power: The Legal Constructions of Informational Capitalism a great sensitizer to the mutual transformations that law, economy, power and technology affect.

Instead, the underlying thesis of the book is that to come to terms with the systemic harms of informational capitalism, we need to develop a keen eye for the precise way that legal rights, duties, immunities and powers are deployed and reconfigured to enable the move from a market to a platform economy —while also detecting the emergence of novel entitlements and disentitlements outside Hohfeld’s framework. Steering clear of both technological and economic determinism, Cohen argues that the instrumentalization of legal institutions by powerful economic actors requires new types of Polanyian countermovements, to address and redress outrageous accumulation of economic power.

In my own terms, Cohen asserts that Montesquieu’s countervailing powers require reinvention in the face of the radical reconfiguration of the political economic landscape wrought by the shift from neo-liberal economic markets to monopolistic multi-sided vertically integrated platform economies. This will require what political economist Karl Polanyi called ‘countermovements’ in his seminal 1944 work, The Great Transformation. Economic markets do not grow like grass (they are not ‘natural’) but are the result of legal entitlements and legal constraints. This implies that markets can be ‘made’ in different ways, thus creating different economic incentives and different outcomes (as to equality and freedom). It also implies that the hold of market fundamentalism on other contexts (politics, health, education) is not ‘given’ and can be pushed back. (See a similar but more condensed discussion in Jedediah Britton-Purdy et al., Building a Law-and-Political-Economy Framework: Beyond the Twentieth-Century Synthesis, 129 Yale L.J. 1784 (2020).)

As the subtitle indicates, this work explains how law contributes to the construction of informational capitalism. The latter refers to a regime where ‘market actors use knowledge, culture, and networked information technologies as means of extracting and appropriating surplus value, including consumer surplus’ (P. 6). It is refreshing though disturbing to be guided through the motions by which some of law’s pathways have been instrumentalised to safeguard privileged private interests where public goods are at stake and both fairness and freedom trampled upon. Such instrumentalization needs to be detailed, called out, and countered.

Cohen weaves a textured narrative with detailed attention to the developments that shaped and reshaped our legal institutions, which in turn shaped and reshaped the pathways of our political economy. Often, she describes opposing accounts of what is at stake, followed by new insights that can only be mined when looking awry – away from conventional oppositions that distract attention from underlying reconstructions. Let me give one example. Discussions of IP law often contrast incentives for individual creation with control over such creation, or reward of original invention with reward of capital investment and corporate risk taking. Cohen uncovers how such discourse remains within the confines of Chicago School economics, with its emphasis on atomistic methodological individualism, consent as a commodity (termed ‘consumer preference’), and a blind eye to power relationships. Instead of staying within the limits of this discourse, she tracks the legislative as well as judicial transformations that enabled the growth of patent portfolios meant to bolster bargaining positions rather than rewarding either individual creativity or innovative risk taking. In doing so, Cohen avoids the usual ideological trenches, keeping her eye on the ball: the traditional countervailing powers allowing big players to work around, co-opt or redefine legal institutions that stand in the way of monopolistic control over newly emerging informational sources.

Instead of arguing for a return to liberal markets that supposedly ensured an ideal setting for liberal democracies, Cohen digs deeper into what Polanyi called the ‘double movement’ of 19th and 20th century capitalism. She traces the rise of liberal markets as part of the industrial revolution that was built on the commodification of land, labour and money (the first movement), explaining how the perverse implications of unbridled capital accumulation gave rise to ‘countermovements’ that resulted in market reforms and a strong state to protect against monopolistic power and inequity, thus instigating what in Europe we call social democracies (the second movement). Cohen then demonstrates how the influence of the Chicago School gave rise to a neo-liberal governmentality that makes the idea of an unfettered free market the default setting for pursuing both public and private interests, entangled with an ideology of managerialism. Co-opting the rise of new socio-technical infrastructures that afford rent seeking from the accumulation of (access to) knowledge and information, industrial capitalism has transmuted into informational capitalism, culminating in the platform economy. This, Cohen convincingly argues, requires a new agenda for institutional innovation (new countermovements) that cannot be taken for granted or derived from previous reforms.

As she ends her book, we have a ‘new window of opportunity that now stands open’, thus calling for active engagement of lawyers willing to resist and reform the unprecedented economic power generated by newly shaped neoliberal playing fields. I would agree with Benkler in his 2018 Law and Political economy blog posts on the  ‘Political Economy of Technology’, in which he insists that we should not make the mistake of buying into the mainstream narrative that naturalises both economic markets and technological change, nor reduce the solution space to institutional rearrangement. Instead we should actively collaborate to design and redesign the technological infrastructures that afford informational capitalism.

I believe that Cohen’s analysis of networked socio-technical infrastructures in her Configuring the Networked Self: Law, Code, and the Play of Everyday Practice, Yale University Press (2012), together with the institutional investigations of Between Truth and Power, offer a way to both distinguish and combine institutional and technical redesign as part of the countermovement she calls for. An example would be the legal obligation imposed by the EU General Data Protection Regulation to implement data protection by design. This obligation requires those who deploy data-driven solutions to build protection into their computing systems at the level of their architecture, thus redressing potential power imbalances based on unlimited extraction of personal data at the technical level. Simultaneously, by making this a legal obligation instead of an ethical duty, such redress is institutionalised and becomes enforceable instead of depending upon the ethical inclinations of individual persons or companies.

For a lawyer dedicated to law and the rule of law, Cohen’s account of powerful actors successfully ‘playing’ legal institutions to serve private interests is painful reading. It reminds me that countervailing powers cannot be taken for granted and must be sustained and reinvented; they require new countermovements. This will take more than lawyers, because checks and balances will have to be built into the data- and code-driven architectures that form the backbone of our institutional environment. And those built-in affordances will determine the kind of informational capitalism we must live with.

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Cite as: Mireille Hildebrandt, Countermovements to Reinstate Countervailing Powers, JOTWELL (July 17, 2020) (reviewing Julie E. Cohen, Between Truth and Power: The Legal Constructions of Informational Capitalism (2019)), https://cyber.jotwell.com/countermovements-to-reinstate-countervailing-powers/.