Kevin Ihrke, CFP® | Mar 11 2026 15:00
Like many Americans, I took time last month to watch the Super Bowl. Not a game goes by without a controversial call. At this point, it almost feels expected—especially when a questionable decision tips the game in one team’s favor.
It is rarely the rules themselves that upset NFL fans. Rather, it is the inconsistent application and enforcement of those rules by referees that drives frustration. Referees are human; their eyes and ears inevitably miss things over the course of a fast-moving game. Anyone who watches football regularly has seen blatant missed calls—holding, pass interference, or personal fouls—that can materially alter the outcome.
The rules of the game exist to hold both teams to the same standards, allowing each team to compete to the best of their ability. From there, talent, preparation, and execution determine the winner.
The rules establish a level playing field. From that foundation, merit decides the outcome.
But imagine a different scenario. What if referees simply chose not to enforce the rules against one of the teams? That team would enjoy a clear and unfair advantage. The game would lose its integrity, sportsmanship would erode, and fans would quickly lose trust in the league itself. Few would bother to watch.
Mistakes are inevitable. Selective enforcement is not.
This dynamic—rules versus enforcement—extends far beyond football. It lies at the heart of how societies function, how economies grow, and how financial markets assign value.
As a senior in college, I was tasked with reading Sociologist Donald Black’s book, The Behavior of Law. It offers a powerful framework for understanding why rules are not applied evenly. Black argues that law is not merely a neutral set of written statutes, but a form of social control whose quantity and direction vary depending on social factors such as wealth, power, status, and organization.
In Black’s framework, law flows “downward” more readily than it flows “upward.” Those with less wealth or power are more likely to be subject to enforcement, punishment, and legal scrutiny. Those with greater wealth, political influence, or institutional power often experience less law applied to them—or law applied more gently.
In other words, the rules may be written the same for everyone, but their enforcement is not.
This is not limited to any one country or political system. It is a universal tendency. However, the degree to which law varies with social status has profound implications for a nation’s legitimacy, credibility, and economic outcomes.
Markets are, at their core, trust mechanisms. Investors allocate capital based on expectations—expectations that contracts will be honored, property rights protected, courts will function independently, and policymakers will operate within predictable constraints.
When the rule of law is applied consistently, markets can price risk rationally. Capital flows toward productive uses. Borrowing costs reflect economic fundamentals rather than political whims.
When the rule of law is applied selectively—especially in favor of those with political power—uncertainty replaces trust. And markets either lose capital or investors demand higher compensation for the added uncertainty.
When contracts (think multi-national trade agreements) become political instruments and when institutions (think the Federal Reserve) lose independence and become extensions of executive power, credibility is lost. Few examples illustrate this better than countries where political leaders directly control monetary policy and interest rates.
In nations lacking institutional independence—where central banks are subordinate to a dictator or ruling party—interest rates are often set based on political convenience rather than economic reality. Rates may be artificially suppressed to stimulate short-term growth, finance government deficits cheaply, or preserve political support.
The consequences are predictable and severe:
- Currency depreciation as capital flees in search of stability
- Rising inflation as monetary credibility erodes
- Bond market collapse as investors demand higher yields or exit entirely
- Shrinking foreign investment due to arbitrary policy risk
Turkey provides a modern illustration. Repeated political interference in central bank policy—particularly the insistence on lowering rates in the face of rising inflation—has led to currency volatility, inflationary spikes, and sharply higher sovereign borrowing costs. Turkish government bonds, once accessible to global investors, became increasingly speculative as policy credibility deteriorated.
Argentina offers another case study. Chronic political interference, capital controls, selective enforcement of contracts, and repeated debt restructurings have rendered its bond market effectively uninvestable for long periods. The issue has not been a lack of rules, but a lack of trust that those rules will be honored—especially when they conflict with political expediency.
In both cases, the problem is not merely bad policy. It is the perception that the law itself bends depending on who holds power.
Aside from all the uncertainty brought about by the current administration in the White House, one thing is clear, the President is determined to have a heavy hand over monetary policy, fiscal spending, and the global economy. The invisible hand of the market can’t function when it’s replaced with an iron fist.
Just as in football, it is not perfection that sustains trust—it is fairness.
Markets understand that governments make mistakes. They understand that economic shocks occur. What markets cannot tolerate is selective enforcement, arbitrary rule changes, and institutions that favor one team, or worse, one person over all others.
When wealth and power determine how law is applied, the result is a loss of legitimacy. When legitimacy erodes, so does confidence. And when confidence disappears, capital leaves.
The rule of law is the referee of the global economy. It does not need to be flawless. It needs to be impartial.
Without that, the game isn’t worth playing and people lose out on what would have otherwise been a fair game.