What is called judgement, in virtue of which men are said to 'be sympathetic judges' and to 'have judgement', is the right discrimination of the equitable. This is shown by the fact that we say the equitable man is above all others a man of sympathetic judgement, and identify equity with sympathetic judgement about certain facts. And sympathetic judgement is judgement which discriminates what is equitable and does so correctly; and correct judgement is that which judges what is true.
You will remember 'the equitable' from V.10. It is one of the virtues that is superior to ordinary justice. Justice itself was said in V.1 to be 'complete virtue, but not absolutely' so you might ask in what way to be equitable is better than to be just. The just is "what is fair and lawful," but the equitable may be "what is fair but more generous than the law requires." Thus, the equitable person is trying to treat the other not merely as the law requires, but in a manner that really befits their circumstances. This applies both to things like business deals -- perhaps your employee deserves some profit-sharing, to be raised to a partnership of some sort, or at least a raise, given their robust contributions -- and also to criminal courts. The sympathetic judge is understanding of the circumstances, and correctly discerns how to adjust the law's requirements to the situation. In this way, the lawfulness requirement proves insufficient to complete virtue in its absolute form (this may be another reason John Rawls thought he could dispose of the lawfulness requirement and cash out 'justice as fairness' alone).
That's not the psychological point I wanted to emphasize. The claim Aristotle is going to make is that this virtue is not just another species of practical reason (phronesis) but a distinct part of the soul. He opens with some evidence against that idea:
Now all the states we have considered converge, as might be expected, to the same point; for when we speak of judgement and understanding and practical wisdom and intuitive reason we credit the same people with possessing judgement and having reached years of reason and with having practical wisdom and understanding.
That sounds like a good argument that these really are the same quality, perhaps just being expressed differently in different situations. In the 19th and 20th century, Gottlob Frege and those who followed his threads pointed out that sometimes you can mistakenly identify the same thing by two different names (this became known as the "Hesperus is Phosphorus" example, because the 'evening star' and 'the morning star' turned out both to be Venus). Here we are observing a quality of excellence of judgment, sometimes towards decisions about fairness towards others and sometimes towards practical actions of one's own. Perhaps they are just the morning star and the evening star, appearing at different times in different places but actually the same thing.
There developed also in philosophy a whole collection of arguments about the identity of indiscernibles that is relevant here. The problem was raised as soon as the Stoics, so a bit after Aristotle, but it comes down to questions about things like this. We can't really observe the mind/soul, so we can't discern whether phronesis and sugnome and prohairesis are different objects or parts of the mind/soul. Many philosophers have accepted the idea that in these cases you should think you have reason to believe they are the same thing unless you can find qualities that clearly distinguish them. Aristotle has given us distinguishing characteristics: this one is about judgment and that one is about action. Yet it could be one quality applied to multiple problem sets, and it is only the problems that differ rather than the quality of the soul. This might seem especially true given his next remarks about how all these faculties deal with problems of the same basic kind:
For all these faculties deal with ultimates, i.e. with particulars; and being a man of understanding and of good or sympathetic judgement consists in being able judge about the things with which practical wisdom is concerned; for the equities are common to all good men in relation to other men. Now all things which have to be done are included among particulars or ultimates; for not only must the man of practical wisdom know particular facts, but understanding and judgement are also concerned with things to be done, and these are ultimates. And intuitive reason is concerned with the ultimates in both directions; for both the first terms and the last are objects of intuitive reason and not of argument, and the intuitive reason which is presupposed by demonstrations grasps the unchangeable and first terms, while the intuitive reason involved in practical reasonings grasps the last and variable fact, i.e. the minor premiss. For these variable facts are the starting-points for the apprehension of the end, since the universals are reached from the particulars; of these therefore we must have perception, and this perception is intuitive reason.
Intuitive reason's existence as a separate faculty was given in VI.6 as a deduction that none of the other intellectual virtues could do what we ask it to do. Here, though, it's doing something very similar to what judgment and practical reason are said to do, just 'in the other direction.' What Aristotle means by that is that intuitive reason seeks out the first principles, working backwards from the particulars we have encountered in the world to the universals that should be our starting point. This is what was supposed to happen during 'the good upbringing' -- we would be introduced to many stories by respected elders and, using intuitive reason, derive the necessary first principles about what courage is and what justice is and so forth. Once we have those first principles, we are ready to begin the study of ethics.
What judgment and practical reason are doing is working down the chain from those first principles to the particular facts in front of us: we must render a judgment in this particular case, in which this particular person did this particular thing; or we must decide on a particular action we must take right now in these particular circumstances. Aristotle is suggesting that these are three connected but distinguishable parts of the soul. You could perhaps reduce them to two: intuitive reason is a sort of inductive reasoning from given examples to first principles; the other sort is a deductive reasoning from those first principles down to conclusions about actions to take (judgment, in this sense of the word, being a sort of action you take when you issue a judgment).
Or perhaps it's just one quality, whatever we call it, which works up and down, and which sometimes considers practical matters pertaining to the self and sometimes considers matters facing justice/equity towards others. Aristotle is going to hold that they are different, partly because they appear at different times of life -- and not to everyone.
This is why these states are thought to be natural endowments-why, while no one is thought to be a philosopher by nature, [yet] people are thought to have by nature judgement, understanding, and intuitive reason. This is shown by the fact that we think our powers correspond to our time of life, and that a particular age brings with it intuitive reason and judgement; this implies that nature is the cause. (Hence intuitive reason is both beginning and end; for demonstrations are from these and about these.) Therefore we ought to attend to the undemonstrated sayings and opinions of experienced and older people or of people of practical wisdom not less than to demonstrations; for because experience has given them an eye they see aright.We have stated, then, what practical and philosophic wisdom are, and with what each of them is concerned, and we have said that each is the virtue of a different part of the soul.
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In the title for this post, the V and I are reversed.
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