(Disclaimer = I'm no Posner scholar and it took me so long to read this book that by the time I finished it I had trouble remembering the beginning).
I will try to briefly review this book, given that (as far as I know) there's only one law student reading this blog, and so this book probably has only a passing interest for the other readers. Judge Posner sits on the Seventh Circuit, and is currently most famous for his affiliation with the law and economics movement. He has somewhat controversial views which come as a consequence of applying economic analysis to many legal questions. For those of us who have taken first year contracts his name was thrown around with the idea of an efficient breach of contract (although a breacher would still be liable, Posner believes that if damages are cheaper than performing a contract, we should allow a party to breach a contract and simply pay damages).
In this book Posner sets out to show how every philosophical foundation for law previously argued for is inadequate; in the absence of an adequate foundation, the only thing for a responsible judge to do is to make judgments pragmatically. This is the main thesis of the book (law and economics is brought up as a sub-thesis; but really only tangentially; this book is mostly about pragmatist jurisprudence). His basic method is to take a given explanation of what the law is (let's say originalism), and then point out how that explanation does not fully address the complexity of making legal determinations. For instance, with originalism, Posner points out that all textual analysis is open to indeterminacy. As a result, the idea of a "plain-meaning" of a text (or say, a constitutional clause) is non-existent for a vast array of legal questions.
This method of pragmatism leaves a great deal of discretion to a judge; and Posner is perfectly comfortable leaving open a legislative role for judges. He considers it constrained by the role judges have to play. For example, though Posner is comfortable allowing judge-made law, under his pragmatism a judge must take into account the damage done to the law-making system by judge-made law. Only in cases where judge-made law is less damaging than undermining the legislative branch, would it be okay for a judge to make such a decision. Of course, a judge determines the relative merits of these courses of actions.
Posner's pragmatism goes a long way towards explaining how judicial decision-making is actually made. That is, his work feels like a realist explanation of decision-making. Nonetheless, it feels somewhat vacuous in how little guidance it provides to a judge who is making a decision. I must make the decision which strikes me as most practical. It will seem most practical to me because it is most practical.
How is one to determine what is practical? Posner shies away from providing an answer; it will be up to the individual judge, and this lack of clarity is a necessary condition of the law. Posner does not say this, but it seems that he means this is a necessary condition of the idea of reason. For difficult cases, it is not easy to say what is reasonable and what not. With all things almost equal, there may not be anything to make a decision other than the judge's "gut" feeling about the case. This is not to say Judge Posner advocates haphazard decision-making. On the contrary, he implies that economic analysis is probably the most effective and most correct way to make a legal decision. His argument is that society can agree that economic efficiency is preferable to inefficiency; thus it is at least a reasonable basis for making decisions. He also points out that economically efficient decisions also provide the least incentive for appeals or re-argument or lobbying to change the law. If a decision is inefficient, there will be an incentive to change the decision (whether by legislation or appeal).
Thus, for Posner, there is always a basis to call into question a decision; but the basis will be as flexible as rationality is flexible; insofar as we cannot agree on what's reasonable, we will not agree on what's practical. We need judges to decide what's practical, not because they'll necessarily give the right/best answer; but because we need an answer.