“Twins” who don’t know each other
The scene is Benjamin’s coffee shop located in the Covent Garden in London, not today or recently, but about 150 years ago. The fragrance of coffee aroma coming from the coffee shop was refreshing the whole area in the cold mornings. It was more than an invitation to the neighbours, the shopkeepers, the customers and the pedestrians in the whole shopping area to walk into Benjamin’s coffee shop.
People used to gather at the coffee shop and not only get refreshed with a freshly brewed cup of coffee before starting their daily businesses, but also during day time and evenings to spend time chatting and relaxing with their friends and neighbours.
While Benjamin was doing well with his coffee shop, another businessman - Storr started coming to Covent Garden with his horse carts. Storr regularly left the carts and horses on the street outside Benjamin’s coffee shop for loading and unloading. He sometimes left hay and grain for horses to eat, while the horses used to pee and poop there too. Then it gradually became a messy, ugly and smelly spot.
Storr’s horses and carts obstructed the traffic flow and, blocked out lights from the shops around. The businesses got affected by the behaviour of Storr. One of the most affected was Benjamin’s coffee shop because the unpleasant horse smell overwhelmed the coffee aroma. His customers stopped coming to the coffee shop.
Benjamin filed a court case against Storr claiming damage to his business. And the court made Storr liable for the damage and gave the verdict in favour of Benjamin. Benjamin versus Storr (1874) is a 145-year old court case in England, which is still being used as a precedence in similar cases of public nuisance.
Public nuisance
The term “public nuisance” includes a whole range of individual or collective activities which can negatively affect the public, causing damages to their activity and preventing the exercise of their rights.
In the above case of Benjamin versus Storr (1874), it was a special damage individually to Benjamin, but the overall damage was not limited to an individual. The activities and lives of many individuals as well as those of the community or those in the area got affected negatively. Public nuisance affects the public and, their wellbeing.
After reading the above case and its court judgment, I realized that even after nearly 150 years we Sri Lankans as a country or a nation have not yet come to the standards of “law and order” that had been maintained at that time in England. Some of our activities and behaviour patterns can be obviously categorised as public nuisance.
Such activities and behaviour patterns have become ‘normal’ to the extent that they are not easily recognisable as activities of public nuisance affecting our economy and living environment.
Democratic right or lawlessness?
The line between democratic right and lawlessness is very thin in practice to the extent that we may not be able to distin- guish between the two. For instance, ‘ being opposed’ is a democratic right. But if that opposition is expressed with collective actions damaging the economy and public life, it is then a ‘ public nuisance’.
I believe that a legitimate government has the right to prevent such activities or to claim the damages to the economy and to the public life caused by public nuisance.
However, Sri Lanka does not have a historical track record of being so straightforward in minimising the negative effects of public nuisance. We have learnt to tolerate public nuisance whatever the effects of them on the economy and the public life. As a result many of us have also learnt throughout our history to do things which we see as right in our own eyes. And we used to think that it is our democratic right that we need to preserve.
Economic freedom
We used to admire ‘political freedom’ but do not give the same weight to ‘economic freedom’ - the ability and liberty of an individual or a nation to make decisions over economic activities. The reason why economic freedom is not admired is because in many cases it is viewed or allowed to exist without its foundation - the rule of law.
Rule of law requires its enforcement and equality, while equality before law does not exist without law enforcement.
Rule of law is the foundation of economic freedom, which is the road to economic growth and prosperity. Deviation of a nation from the rule of law is the first sign of economic decline. Rule of law is a critical factor underlying the empowerment of individuals, the ending of discrimination, and the enhancement of competition - all that ensure economic freedom and, thereby prosperity.
The notion of ‘ economic freedom’ often comes under attack not because of anything wrong there, but because of the lack of the rule of law. However, it is not visible to the naked eye exactly because it is the foundation on which economic freedom is built and established strongly.
Therefore, opponents of economic freedom look intelligent when they ignore its foundation. And proponents of economic freedom look ridiculous when they forget its foundation.
The “twins”
We can sometimes interpret that the law is all about ‘procedures’ and economics is about ‘ efficiency’. Efficiency is about adding value; Benjamin was adding value through his business in making coffee with inputs. Procedures are established systems by laws, regulations and accepted norms. Storr’s actions violated the procedures af fecting Benjamin’s activity.
Law and economics both originate from the same source. At the same time, it is quite peculiar to observe that they move in opposite directions. Law and economics are, therefore, like ‘twins who don’t know each other’.
When law and economics don’t know each other, they act on their own, often opposed to each other. Law can dictate procedures that makes the economic operations inefficient, on the one hand, for instance, new procedures would have made Benjamin’s activity more costly. Economics can recognise the ways to make activities more efficient, thereby violating the established procedures, on the other hand, for instance, Benjamin would have found ways and means of avoiding the procedures to make his business more efficient.
When they recognise each other, it is the ‘best’ economic system that a country can establish. It will make the economic environment more efficient and more disciplined - the road to prosperity.
This is the reason why many international organisations concerning economic affairs employ professionals from both economic and law backgrounds. Many universities in different countries have come to recognise the importance of having law and economics together so that they offer degrees with combinations of the two subjects. The countries which undertake ‘policy reforms’ naturally and understandably require the inputs from both economics and law.
Many Benjamins and many Storrs
At the time of Benjamin versus Storr, Sri Lanka was under British colonial rule. They had passed the laws and regulations and, established the rule of law in Sri Lanka too. The authorities had also introduced universal suffrage in Sri Lanka, just three years after it was established in England and even before some other European countries received it.
Over the years of dilution of the established ‘procedures’ that Sri Lanka inherited from the British, we are now left with weak enforcement of law and order. As a result ‘public nuisance’ is as normal as any other day-to-day affairs of life.
There are plenty of Benjamins throughout the nation, whose activities and lives get affected by the behaviour patterns of many Storrs. The aggregate implications impact upon the economy and its progress of the nation.
If we had a way to make an assessment of the aggregate damage of public nuisance to the nation, I believe it would be substantial. (The writer is a Professor of Economics at the University of Colombo and can be reached at sirimal@econ.cmb.ac.lk)
While Benjamin was doing well with his coffee shop, another businessman - Storr started coming to Covent Garden with his horse carts. Storr regularly left the carts and horses on the street outside Benjamin’s coffee shop for loading and unloading. He sometimes left hay and grain for horses to eat, while the horses used to pee and poop there too. Then it gradually became a messy, ugly and smelly spot.
Rule of law is the foundation of economic freedom, which is the road to economic growth and prosperity. Deviation of a nation from the rule of law is the first sign of economic decline. Rule of law is a critical factor underlying the empowerment of individuals, the ending of discrimination, and the enhancement of competition - all that ensure economic freedom and, thereby prosperity.