Wednesday, September 30, 2009

Unexecuted Warrants and the Dog that Didn't Bark

By Sherry Colb

My FindLaw column this week discusses the case of a man who sued the District of Columbia for issuing a warrant for his arrest without probable cause. The man was never actually arrested, so the column takes up the question -- currently before the D.C. Circuit Court of Appeals -- whether the issuance of an invalid arrest warrant either inflicts or threatens injury sufficient to allow a litigant into federal court. I argue that it does and that the Fourth Amendment often concerns itself with government conduct whose injurious nature is far more abstract than the sorts of injuries that the law generally addresses.

In this post, I want to connect the essence of the Fourth Amendment -- and its guarantee of the right to "be secure against unreasonable searches and seizures" -- with the Arthur Conan Doyle mystery in which Sherlock Holmes figures out that a stranger could not have been the intruder because the dog did not bark (and the dog would have barked if a stranger entered the premises).  Holmes is able to focus on the absence of something (a bark) to solve a murder mystery, when everyone else is focused only on who or what was present on the premises (including the wrongfully accused stranger).

It is human nature to attend to what is present and to miss, often to our own detriment, what is absent, even when an absence is far more informative than any presence.

What does this have to do with the Fourth Amendment case of an arrest warrant that is never executed? Our tendency, in assessing whether a constitutional violation has taken place, is to look at what the police did to a particular individual. In the case of an unexecuted warrant, the police successfully sought a warrant to arrest a suspect against whom they lacked any probable cause. They never arrested him, however, and they therefore did not subject him to any seizure, reasonable or otherwise. What the police did therefore seems to fall short of anything properly actionable.

What is absent, however, when a warrant has issued for your unlawful arrest? It is "security" from unreasonable seizure. The Fourth Amendment gives the people the right to be secure against unreasonable searches and seizures. Once an illegal warrant has issued, there is no more security (until the point at which the warrant is withdrawn), just as there is no security -- as the Supreme Court has recognized -- when there is no enforcement mechanism available for ensuring that police comply with the dictates of the Fourth Amendment.

It is easy to miss the seemingly superfluous words in the Fourth Amendment text, "to be secure," but in their absence, the text could have protected "the right of the people against unreasonable searches and seizures." Security is a right that goes beyond not being victimized by a particular search or seizure. The plaintiff in the case I discuss was insecure, not unlike the person in a house at which the door has been removed. Though no one may yet have broken in, and though the occupant may not even know that the door is gone, the security that was, is no more. One expects not only to be free from unlawful governmental intrusions but also to be secure against them, to be confident that they are not about to take place.

If the government violates the law and thereby paves the way for more concretely violating an individual's rights, his security has been taken away. Even more so if, as the lower court held, he lacks any remedy for that violation. Though it is more of an absence than a presence, the lack of security is significant. It is arguably what the Fourth Amendment is all about.

Tuesday, September 29, 2009

Is the Constitutional Law of Health Care Reform the New Global Warming?

By Mike Dorf

Until very recently, even mainstream news organizations felt a misguided sense of obligation, when covering global warming, to present the issue as though there was a real debate about whether human beings have made a substantial contribution to the phenomenon.  Crackpot skeptics and industry flacks were given equal or nearly equal time with scientists speaking for the overwhelming consensus.  Thankfully, that approach has largely faded with respect to global warming.

But the root cause of the problem remains and is worse than ever: Journalists labor under a professional obligation to provide "balance" in their stories but they are generalists who typically lack the expertise necessary to evaluate the evidence for the positions taken by people on different sides of any question.  Hence they simply quote people expressing a variety of views (and often fall into the trap of framing questions as though there are exactly two sides).  This problem has been exacerbated by the declining revenues of newspapers: Forced to lay off staff, the papers give each remaining reporter a larger beat to cover, meaning that the typical, well-intentioned and quite smart reporter increasingly finds herself writing about unfamiliar matters.

Perhaps a case in point is this article by Monica Davey in the NY Times.  The piece documents a recent trend of states passing laws or state constitutional provisions forbidding a legal mandate that everyone buy health insurance.  Such a mandate--or its equivalent--is an essential piece of any law that would prevent health insurers from rejecting insureds with pre-existing conditions: Without the mandate, people willing to forego routine health care (as many young, healthy people are), can wait until they need expensive care, and then sign up for health insurance.  This is patient-side adverse selection, and health insurers are right to worry about it.  Universal coverage (through a mandate or otherwise) is the solution.  And that is in fact why some states are trying to outlaw the universal mandate: They know that doing so will kill health-care reform.

But here's the thing: The state laws can only have a symbolic effect on a federal mandate.  Under the federal Constitution's Supremacy Clause, a valid federal law overrides a state law or state constitutional provision.  And a federal requirement that everyone buy health insurance would clearly be a valid exercise of Congress's power to regulate interstate commerce.  How do we know?  Because of numerous Supreme Court decisions, including the 6-3 decision in 2005, in Gonzales v. Raich, that Congress can forbid, under its Commerce Clause power, the intra-state cultivation and distribution of marijuana, even in the face of a California statute making those activities legal when licensed for medical purposes. Regulation of the interstate market in health care is simply a no-brainer under modern Commerce Clause precedents.

The Times article quotes two law professors who agree with my analysis, but it also dutifully quotes supporters of the state law measures, even though the arguments they make would earn an "F" on a constitutional law exam.  The reader who lacks a serious background in this area would come away thinking that this is a legitimate debate, just as one might have come away from older articles on global warming thinking that they report a serious debate.

The best that could be said for the view that the state laws could block a federal universal mandate is that Supreme Court cases should not define the meaning of the Constitution for everyone.  The Court has upheld nearly everything that Congress has done under the rubric of the Commerce Clause but, following an argument first articulated by Thomas Jefferson and lately revived by Justice Clarence Thomas, one might think that the Court got it wrong.  That's fair enough.  But there's no chance that the rest of the Justices are about to change their minds, and absent such a change, litigation under the state laws cannot block or even substantially delay a federal mandate.  A truly balanced story would have made crystal clear that whatever value these laws have as political statements, they rest on what the courts will regard as a crackpot legal theory.

Monday, September 28, 2009

What Maynard Keynes, James Dean, and Now Richard Posner All Have in Common

By Bob Hockett

The G-20 group of industrialized and industrializing countries have just met in Pittsburgh to consider coordinated next steps we might take to restore and maintain global financial stability. Meanwhile, the Angelides Commission – the U.S.’s latterday “Pecora Commission” – finally has begun meeting in Washington to ascertain “what went wrong” in financial markets these past several years or more. More or less simultaneously, House and Senate Committees chaired by Congressman Frank and Senator Dodd, respectively, have at last begun meeting to consider possible improvements to – perhaps even a complete “overhaul” of – our U.S. “system” of financial regulation.

In the lead-up to these interesting developments, a lively debate has emerged in the academy, the press, the “blogosphere,” and even the more popular media, not only about “what went wrong,” but also and relatedly about more fundamental questions. Many distinguished names have figured into the discussion thus far, two of the more recent being those of Paul Krugman at Princeton and John Cochrane at Chicago. (See recent posts on Leiter, for example: Lawyers in particular will be intrigued to know that even Judge Posner has now got into the act, with a brief book, several articles, and media interviews on the subject already to his name. (See this one, for example.)  He has also announced a recent conversion of sorts to a species of Keynesianism – though some who might wish to be cool in an inconsequential sort of way will be tempted to point out that what he now champions is not what the cognoscenti call “Keynesianism” – which Keynes himself disavowed because of its inattention to uncertainty – but “post-Keynesianism.” (The story of “Keynesianism’s” many prefixes over the past seven decades, from what Joan Robinson called “bastard-Keynesianism” on down through “new,” “neo-,” and “post-Keynesianism,” makes for a fascinating, if bemusing, tale better told elsewhere.)

Now as I say, the questions that have emerged in the current discussion are not only about what went wrong, but also more fundamental in character. They implicate not only regulatory policy, but also financial theory, monetary theory, macro theory more generally, and micro theory as well. “Maybe markets are not efficient after all,” we hear some now saying. “Maybe market actors are not rational either,” some also say. “Maybe it’s all just psychology,” or “irrational exuberance,” or Tobin-style “liquidity preference as behavior towards risk,” or some other such thing, we hear more and more often these days. Well, maybe indeed. But I’ve come to think that at least some of the discussion we’re hearing these days rests on a misconception or two, and that it would be helpful to highlight them even for those who are skeptical of market efficiency or trader rationality. Doing so should enable us better to recognize which proposed improvements to our financial system are apt to be most effective, and which of them less so. And relatedly, it should also facilitate the identification of reforms that believers and skeptics alike, where market efficiency and rationality are concerned, can join energetically in supporting.

So what are the misconceptions I think I detect? These: My impression is that there is a tendency among some participants in the current discussion – as well as among some policy-makers over the past decade or so – to equivocate, first, between two senses of "efficiency," and second, between two senses of "rationality." I suspect, moreover, that these equivocations might well be partly responsible for the pass in which we now find ourselves. Here's what I mean.

First, on "efficiency," the so-called "efficient capital markets hypothesis" (also “ECMH,” sometimes "EMH") familiar to finance is a pretty well corroborated conjecture concerning the speed with which the capital markets aggregate "information." But the information in question, it bears emphasizing, is not restricted to facts actually bearing upon firms' “fundamentals” or future prospects. (If it were, then informational efficiency would conduce straightaway to allocative efficiency, more on which presently.) No, the "information" in question also can include misinformation, disinformation, incomplete information apt to be revised or more fully filled in later, and so forth. The idea animating the EMH, in other words, is simply that trading has become sufficiently rapid and easy, and the financial markets so liquid, that securities prices very quickly impound and reflect the beliefs of all market participants -- even beliefs that in the end prove ill-founded, incorrect, only partly correct, or what have you. (It probably bears noting here, while we are at it, that it is the so-called "semi-strong" form of the hypothesis that has thus far been pretty well empirically corroborated by Fama and his followers.)

Moreover, and possibly more crucially, the EMH has nothing what ever to say about facts bearing upon firms' future prospects of which no trader as yet has any knowledge or inkling at all -- facts that would fall under the Keynesian (and Knightian) headings of "uncertainty" as distinguished from "risk." Where we not only don't know which face of the die will land up, but also don't know what values are etched on the faces of the die to begin with, we cannot speak of probability distributions at all, hence cannot compute even "expected" values, let alone actual ones. Hence we speak less of “risk” than “uncertainty” in these settings. It is in this realm of complete informational void that Keynes thought conventions, rules of thumb, and ultimately "animal spirits" to play most freely. That fact, in interaction with the next observation I'll make – on "rationality" -- seems to me likely to have played a role in our recent bubbles and crashes. More on that in a moment.

Now the equivocation on "efficiency" to which I alluded above is just this: There seems to be a tendency for some participants in the current discussion to conflate informational efficiency (on the EMH’s permissive understanding of "information" just elaborated) either with allocative efficiency, whereby capital flows toward its most valued uses; or just plain "efficiency" understood as a rough sort of synonym for "the state of being really cool,” or “as good as it gets." The unexamined thought seems in other words to be that, because the capital markets quickly take in and impound all value-pertinent information that there happens to be, they also immediately and unambiguously direct capital toward where it adds most value. But the moment one reminds oneself that "information" is actually employed in a much looser sense than the "fundamental-value-pertinent" sense for purposes of the EMH, one spots a gap between informational efficiency and allocative efficiency.

Keynes, of course, famously spotted this gap, and virtually all of the General Theory's observations and recommendations are in effect situated within it. Keynes's interest in the gap between informational efficiency and allocative efficiency also underwrites the most droll, in my humble opinion, of all of his many droll quotable recommendations (thought this one for some reason seldom is quoted): I refer to the recommendation that we seek, in his words, "the euthanasia of the rentier." A frequent and accomplished trader in his own right (born to a humble academic family, he left what had been a secret estate of over $30 million upon his death), Keynes ultimately came to think the securities markets so prone to what we might call not just "informational efficiency," but also "misinformational efficiency," that he ultimately advocated that we consider some form of what he called "the socialization of investment." To employ the more contemporary Fischer Black lingo, he came to think "noise" trading more the rule than the exception much of the time, and recommended in consequence something in the way of a government-guided "industrial policy" -- something a bit like what MITI famously did in Japan in its "miracle" period, and what China's government does now.

Now to the conflated two senses of "rationality" that I have in mind: It is sometimes, though alas, apparently not often enough, observed that multiple acts of individual rationality can aggregate into collectively irrational outcomes. The most familiar instance of this phenomenon is of course the tiresomely familiar "prisoner's dilemma," but there are many more. All so-called "collective action problems" and probably most so-called "coordination problems," one reckons, are instances. Yet many commentators seem to speak of "market rationality" and "trader rationality" almost as if they were one and the same thing, or at least as if multiple acts of the latter always aggregate to the former. But it just isn't so. To take a recent salient case in point, there is plenty of anecdotal evidence to the effect that hedge fund managers and like folk strongly suspected in recent years that they were trading under asset price bubble conditions, and knew in consequence that at some point the whole thing was apt to come a cropper. They kept trading anyway, however (so some have told me), in view of (a) their knowledge that the closer you draw to the bubble’s inflection point before exiting, the more millions you win, (b) insistence on the part of their customers that they stay in the game to keep winning those millions for them, on pain of withdrawing and moving their money to competing funds, and (c) their oft-harbored and not altogether insane hope that they might manage to get out comparatively early once the inevitable but indeterminately dated collapse commenced.

What, then, to make of all of this? Well, these observations on efficiency, rationality, and the actual experience of those market participants who have reported from the trenches suggest, to me anyway, the following parable as possibly capturing what happened in the years leading up to the autumn of 2008 and its sequel. Consider a modified version of that game of drag race "chicken" you likely saw in the old James Dean film, Rebel Without a Cause. We’ll imagine that in this game James Dean and the punks who have provoked him are once again drag-racing toward a cliff side as in the film. In this rendition of the game, however:

First, the drivers cannot see more than a few meters ahead, and therefore mainly look only sideways and backwards. They basically see just one another and those who are at most a few meters ahead. Nor do the drivers know antecedently how far away the cliff side is. It might be blocks, it might be miles, they simply don’t know; there is as yet no information about that. The confident drivers, however, who by virtue of prior experience know themselves to have quick reflexes, expect to be able to bail the moment they feel a loss of elevation up front, or see someone incrementally ahead of them beginning to dip or plunge down. And as in the game in the film, no one loses by losing the car. (This image of course roughly models the uncertainty, as distinguished from risk, that the drivers face in respect of the date of an asset price bubble's collapse. It also captures what Keynes would call “beautiful baby” trading – trading with a view to what others are doing, rather than to any perceived “fundamentals” – more on which below. Finally, it also captures a bit of the “things might be different this time” idea that sometimes attends asset price bubbles when they are initially catalyzed by bona fide new value-adding inventions or technologies like desktop computing, an internet, or efficient new financial instruments.)

Second, the drivers win more money with each foot or meter they traverse en route to the edge. At least that is so until people begin to go over the edge. Once a certain – though presently indeterminate – number of them do begin driving over, drivers must reverse course and race back in the direction of the starting line as quickly as possible, with the last to arrive at some indeterminate point roughly between one-half and three-fourths of the way back losing more of their previous winnings than those ahead of them. We might picture it as the ground’s crumbling progressively from the cliff side on back, to around halfway to three-quarters of the way back to the starting point, once the critical number of drivers have gone over the cliff. (This roughly models continued winnings as the asset price bubble continues to inflate, and losses once the inflection point has been reached and the markets commence to return to the point actually warranted by the new value opportunity that got the spontaneous pyramid process that is the bubble started in the first place.)

Third, the drivers also can place side bets on their own performances and those of their competitors, both with each other and with other, non-drivers. Some of them can do so, moreover, without having to prove that they’re good for their possible debts on the bets. And some even can borrow in order to bet, some of these on the strength of their reputations, others on the strength of their winnings already won along the way in the race. Drivers might do such things with a view to hedging some of their risk of ultimately losing in the drag race, or with a view to “levering” their winnings, or some complex of these and related intentions. (This roughly models the swap and levering arrangements that also played a key role in the recent collapses.)

Fourth, in addition to the insurance that takes the form of the hedging bets, there are a number of variably wide nets down below the cliff, set at varying heights. There’s also one very wide net at the very bottom, though it’s not clear how far down that is. No racers will die, but there might be real butterflies for many on the way down. Racers also know from earlier drag race experience that many racers – those that land in higher nets – will get to keep some, perhaps even much -- though it's not clear how much -- of their winnings even after driving over the cliff. For the drag race chicken economy is very important in this James Dean world, and its continuance rests on the continued presence of a critical mass of people who remain willing to play. (This of course roughly models implicit guarantees by a lender of last resort ready to bail out, in various amounts and with various conditions, some of those who go over the cliff when ever many of them do.)

Finally fifth, everyone knows that if only cars, but not drivers, go over the cliff, the drag race chicken economy will retain more wealth than if otherwise. They accordingly expect that there might be some intervention by the race-administrator prior to anyone’s reaching the cliff side. For they have seen this happen before, in times when prior administrators spoke about “leaning against the wind,” “taking punch bowls away when the parties begin to get good,” and so forth. (This models another role, additional to that of lender of last resort, that has sometimes been played by systemic risk regulators – notably the Fed in the U.S. case, when chaired by the likes of William McChesney Martin and, later, Paul Volcker.)

Now, here’s the interesting thing – the punchline – of this fanciful story: There does not appear to be any generally accepted canon of rationality pursuant to which these drivers can be deemed "irrational." Indeed, it might even be tempting to say some of them would verge on irrationality (perhaps even violation of fiduciary duty in some cases) if they did not play for a while, assuming that this form of play constitutes their occupation, which of course it does for many professional market participants. Sure, some lily-livered types will find the whole thing a bit too wild and chaotic to indulge in, just like they find roller coasters loud and scary. These folk will stay home and read Jane Austen novels instead. But thrill-seekers and even just plain rational money-seekers will not be univocally irrational to enter this race, or even to stay in it until … when?

In short, this entire parable is just another instance of the not unfamiliar observation that multiple acts even of bona fide individual rationality (or at the very least non-irrationality), occurring against the backdrop even of an admittedly informationally efficient environment, can, if the "information" in question does not include anything one way or the other so far as the end date of an asset price bubble (the location of the cliff side) is concerned, readily aggregate to a pathological -- a collectively irrational and allocatively inefficient – outcome. That outcome in our latest iteration of this “individually rational, collectively irrational” game is the 2009-09 market crash and ensuing economic slump. In prisoner’s dilemma games it is imprisonment. In ultimatum and dictator games it is mutual harm. In arms races it is wasteful expenditure. And so forth.

The point here, I think, is important to make even if we are skeptical about whether all were rational in the latest round of the familiar bubble and bust story, or whether markets were informationally efficient over the course of the past several years. My point, in other words, is not that the markets were all the time informationally efficient and individuals were all the time individually rational, but that they didn’t have to lack these characteristics in order for what happened to happen. I think it important to make that point because I suspect that a misconception concerning rationality's and efficiency's compatibility with bubbles and bursts might at least partly account for "our" -- through our this time ineffectual collective agent, that systemic financial risk regulator known as the Fed -- not having looked out for and acted to forestall our most recent asset price bubbles and busts.

My conjecture, in other words, is that many people like Greenspan first mistakenly thought that asset price bubbles -- or at least their detectability in advance of their bursting, in Greenspan’s case -- are incompatible with individual rationality and market informational efficiency. Then, reluctant to part with the latter presumptions (which again are not altogether lacking in empirical corroboration, and are hard to part with for modeling purposes in any event), they concluded that there was no point in looking out for and acting to head off the bubbles. Had these people been clearer about bubbles' and bursts' compatibility even with individual rationality and informational efficiency as these are actually understood in the technical literature, they might have helped prevent the whole sorry thing's happening -- or at any rate lessened its severity. That seems a lesson worth bearing in mind as we turn now to updating our methods of financial regulation both nationally and internationally.

If anyone's interested in reading more on this, here's the link to an early draft from last year of an article on the whole matter that’s soon to come out. There you can read about “Beautiful Babies,” “Ponzi Processes with no Ponzis,” “Minsky Moments” and more here.

Friday, September 25, 2009

Senator Kirk and the Constitutionality of Expedient Law Switching

Massachusetts Governor Deval Patrick's selection of Paul Kirk as interim Senator pending a special election to fill the seat left vacant by Ted Kennedy's death provides an opportunity to consider the constitutionality of a phenomenon I'll call "expedient law switching." Readers will recall that back when John Kerry was running for President, Massachusetts Republicans urged changing the law so that the governor--then Republican Mitt Romney--would be able to name an interim replacement. The majority-Democratic legislature declined to do so, although the point proved moot when President Bush won the 2004 election.

But the law left Massachusetts with a problem: when Ted Kennedy died, it was going to have only one Senator for the many months it would take to organize a special election. And so, presto!, the majority-Democratic Massachusetts legislature obliged by giving the now-Democratic governor the power to name an interim Senator, which he just did. Republicans in Massachusetts (yes, there are still some) are crying foul. Are they right?

Let's consider the general phenomenon of expedient law switching. Suppose that an ordinance in the small town of Racistville provides that "no building permits shall be granted for any structure to be erected within 100 feet of the shore of Racist Lake." Now suppose that whenever a white landowner seeks to build a lakefront house, the town council convenes and repeals the ordinance, whereupon a permit is granted by the mayor. Immediately thereafter, the council re-enacts the ordinance (which applies only prospectively), and does not re-repeal the re-enacted ordinance when non-white landowners want to build by the lake. In this example, the "real" law in Racistville is "no building permits shall be granted to non-white property owners for any structure to be erected within 100 feet of the shore of Racist Lake." And this "real" law would be a violation of the constitutional requirement of equal protection. (Larry Alexander wrote an excellent paper on this phenomenon some years ago.)

So, what is the "real" law of Senatorial succession in Massachusetts? The answer isn't entirely clear, partly because one switch doesn't establish a pattern. But there seem to be two main candidates. One characterization is this: 1) Democratic but not Republican governors can appoint interim Senators to fill vacancies pending a special election. But another possibility is this: 2) When the governor is a member of the same political party as a Senator whose seat has become vacant, the governor can appoint an interim Senator to fill a vacancy pending a special election. "Real" rule 1 is highly problematic as a matter of equal protection (or the right to vote, or whatever), while "real" rule 2 is much less problematic because it has a legitimate justification: The people elected a Senator of Party X to a 6-year term, and until they elect a Senator of Party Y, that choice should be respected, or at least not contradicted.

How can we figure out what the "real" rule is in Massachusetts? One clue will be provided by whatever the legislature does next. If they are especially shrewd, then before the next gubernatorial election they will repeal the law that authorized Kirk's appointment. That way, if another Republican becomes governor, he'll be stuck with the Romney rule. (It would be too late to repeal the authority once the Republican won the governorship because he would then veto the proposed change.) Meanwhile, if another vacancy opens up on a Democratic governor's watch, the law authorizing interim appointments could be re-enacted. I'm betting that the Massachusetts legislature doesn't try this maneuver, and if it doesn't, that will be pretty good evidence that the "real" law in Massacusetts isn't nearly quite so problematic as the "real" law in the hypothetical racistville.

More broadly, though, it will be hard to identify "real" laws of this sort, for reasons similar to the reasons why it is hard to win a case that depends on proving impermissible selective enforcement of a facially valid law.

UPDATE: As a reader points out in the comments, the Mass. legislature actually CHANGED the law to de-authorize appts by Romney when he was governor, and given the overwhelming Dem majority in the Mass. legislature, they could wait for a Republican governor to repeal the interim appointment power, and then override his veto of the repeal. So we have 2 switches, not 1. I think this makes the Mass. case more interesting, although it still doesn't fully distinguish between interpretations 1 and 2. Denying a Republican qua Republican the power to make interim appts is highly problematic; denying a governor the power to appoint a replacement for a Senator of a different party is much less problematic. Of course, we KNOW that the Mass. legislature is really pursuing party advantage, i.e., that interpretation 1) is correct; that's what legislators do (whether D or R). But proving that and coming up with an appropriate judicial remedy are so daunting that cries of foul would seem to have to be addressed to the public generally rather than to the courts.

Posted by Mike Dorf

Thursday, September 24, 2009

Government is Neither Friend nor Enemy

My new column, "Stop Denigrating Government: There is No Economy Without It," is now up on FindLaw. In it, I make two basic points: (1) The "left" in the United States is not pro-government but is, in fact, highly skeptical of all human institutions, understanding that government institutions can be used to counterbalance the excesses of non-governmental institutions (especially for-profit corporations); but the government itself is prone to excesses that must be reined in. (2) The notion that "government is the enemy of business" is incoherent, because business could not exist in any but a primitive form without a robust and reasonably reliable government sector. (Tax scholars know this as "the Murphy/Nagel point.")

It is surprising that those points even need to be made, but the current political moment is full of surprises. In this post, I want to expand on those points and to address a provocative question raised by the Murphy/Nagel argument.

In the context of global political beliefs, American liberals are government minimalists. No one with any standing on the left in this country takes the position that the government is never wrong. This point is often lost, I think, because the issues that come up in the political debate arise from situations in which something has failed. We do not need to debate how to fix a problem that does not exist, so the political arena essentially is filled with debates about what to do when there is a problem that people have not been able to fix on their own.

Forty-plus million people have no health insurance. Acid rain kills the forests in the northeast United States. Women are fired because they become pregnant. A Nazi government in Germany invades our allies and poses a threat to the United States. The Cuyahoga River catches fire. Black men are being lynched. In each of those situations, the problem is brought to the political arena, and the question is whether to do anything and, if so, what that should be. Even if the agreed upon solution is to study the problem further, it is literally accurate to say that "government has become involved." More generally, people who believe that there is a problem rightly conclude that the problem has not (yet?) been solved by private action or "natural" processes, making the possibility of public action salient.

The people who propose such a response need be neither "fans" of government as a first option nor Pollyannas who believe that the government will perfectly solve the problem. It is in all such cases regrettable that we have even reached the point where a response by government action might be called for -- especially because any government action brings with it its own potential problems, including the possibility of corruption, waste, etc. It is merely the most basic cost/benefit calculation to say: "We have a problem, and we need to determine whether there is a way to reduce the problem without creating new problems that are worse." Some people believe as a matter of deep certainty that any response "involving the government" will be worse. Liberals, as I understand that term, think that at least sometimes things can be made better by enacting changes in the law, sometimes including enacting laws that provide for direct action by government agencies and employees. Sometimes not.

The Murphy/Nagel point takes this further by demonstrating that there is no such thing as a response to a perceived problem that does not involve ongoing action by the government. Even the elimination of a government agency (such as the mothballing of the Civil Aeronautics Board during the Reagan administration) leaves private actors to act in an economy that is defined by government rules. Contracts are enforced, property is protected, injuries are compensated, crimes are prosecuted.

Because the government is (and must be) the enabling institution that makes a modern economy possible, it becomes puzzling to try to figure out what really is an "anti-government" position. Several years ago, for example, Dan Shaviro at NYU Law wrote a paper in which he referred to George W. Bush's tax cutting policies as "steps toward big government." His point was that Bush's tax cuts would put in motion a series of events that would lead to a greater involvement in the economy by requiring higher taxes in the future. The point can be generalized, a la Murphy/Nagel, to say that it is often difficult to describe an action as increasing or decreasing the size or reach of government. If, for example, we choose not to have universal health insurance coverage, this will cause the government to spend more money on emergency rooms, public health measures (such as coping with diseases and potential epidemics spread by people who do not receive preventive care), and potentially criminal activity if people become desperate or deranged.

Even so, it is true that American conservatives and liberals often agree on what counts as less vs. more government. A standard liberal description of the causes of the current financial crisis is that Wall Street was "deregulated," meaning the repeal of Glass-Steagall when a Republican Congress passed and President Bill Clinton signed the Gramm-Leach-Bliley Act in 1999. If that is deregulation, however, what do we make of the Murphy/Nagel observation that the financial markets were still regulated in the sense that the government was a necessary player in making it possible for financial markets even to exist and function?

As a tentative answer, I suggest that both conservatives and liberals are wrong to use the terms regulate and deregulate. Every change in the law will change the regulatory terrain within which people and businesses act, but there is frequently no meaningful way to describe one situation as "more regulated" than another. (I say frequently because one can certainly imagine an easy case where some extensive set of rules is repealed. Even there, however, it is not as if such a repeal leaves the private actors in a law-free zone.)

A reader on this blog once referred to a point that he was making on the comment board as somewhere between painfully obvious and embarrassingly obvious. To a certain degree, I have that feeling here. We have a system of government, and our ongoing enterprise is to figure out how to adjust its rules and behavior to enhance the general well-being. Even as a rhetorical ploy, "you're for Big Government" simply makes no sense. At the end of the Summer of 2009, amazingly enough, that point bears repeating.

-- Posted by Neil H. Buchanan

Wednesday, September 23, 2009

The Next Steps After the Minnesota Vikings Drug Testing Case

In my latest FindLaw column, I analyze the recent 8th Circuit decision in Williams v. NFL. The court held that Section 301 of the federal Labor Management Relations Act does not preempt lawsuits under two Minnesota statutes relied upon by two Minnesota Vikings to challenge the NFL's disciplinary action against them for using a banned substance. (They took a supplement that they did not realize contained a banned diuretic, which can be used to mask evidence of performance-enhancing drugs.) I explain in the column why principles of federalism support the 8th Circuit ruling.

Here I want to ask what happens now. The same federalism-based reasons I offer in the column in support of the 8th Circuit's interpretation of Section 301 counsel against Congress taking action to preempt state law with respect to drug testing of professional athletes. Could the NFL and the NFL Players Association gut protections like those in the Minnesota statutes by agreement? Maybe.

As the 8th Circuit read the relevant Minnesota statutes, nothing in the collective bargaining agreement was relevant to the disposition of the claims, and therefore there was no preemption. At least with respect to Minnesota, that is likely to continue to be true even for a rewritten collective bargaining agreement after the current one expires in 2012. However, the parties could partly circumvent Minnesota law by specifying that state law claims such as those arising under Minnesota law are subject to the same arbitration process as other issues. Earlier this year, in 14 Penn Plaza, LLC v. Pyett, the Supreme Court held that unmistakably clear language in a collective bargaining agreement can waive individual employees' rights to a judicial forum for the litigation of federal statutory rights under the Age Discrimination in Employment Act (ADEA) and, by parallel logic, the same would be true for rights under other statutes, including state statutes.

In principle, such a new agreement would leave substantive rights under Minnesota law intact; players would have to make their arguments to the arbitrator rather than to the court. But in practice, this would be a great boon for the NFL, for under the collective bargaining agreement now in place, the NFL Commissioner can simply choose an arbitrator. In the Williams case he named the league's own general counsel, Jeff Pash. I have great respect for Pash. He was my mentor 20 years ago when I was a summer associate at Covington & Burling, where he was then a young partner. But even assuming completely good faith on his part, it is hard not to see the process as tilted in favor of the league. And for that very reason, it is likewise hard to see the NFLPA agreeing to submit these sorts of claims to labor arbitration--unless the union gets something substantial in return.

Posted by Mike Dorf

Tuesday, September 22, 2009

The Iqbal Overruling Strategy

Readers of this blog (here and here, for example), and of my FindLaw columns (here, here and here) know that I am a critic of the Supreme Court's rulings in Ashcroft v. Iqbal and Bell Atlantic v. Twombly, which together made it easier for federal district courts to dismiss civil lawsuits. I am hardly alone in my critical position. And now it seems that plaintiff groups (and plaintiffs' lawyers' groups) are gearing up to respond.

As explained in this National Law Journal article by Tony Mauro, the effort to change the law is proceeding on two tracks: (1) A bill in Congress; and (2) The Rules Advisory Committee process. As I noted in one of my columns and an accompanying blog post, the bill proposed by Senator Specter has some technical flaws but these are likely to be corrected in the legislative process. As for the Rules Advisory process, there is the worry that, as U Penn law professor Steve Burbank (quoted in the Mauro article) says: "The process is under the control of the Supreme Court, which is responsible for these atrocities."

That control takes two main forms. First, as Burbank notes, the Chief Justice appoints the members of the Judicial Conference. Second, the Supreme Court itself must approve Rules changes before they become effective (if not vetoed by Congress). True, the Court rarely declines to rubber stamp rules changes approved by the Advisory Committee process, but it can.

All of this leads to an interesting strategic question of timing. The Advisory Committee process is harder for interest groups (such as business groups trying to maintain the status quo and plaintiff groups trying to change the law back to the pre-Twombly/Iqbal regime) to influence than it is for those interest groups to lobby Congress. Suppose one thinks that there are not enough votes to break a Senate filibuster against a revised Specter bill. Going to the Rules Advisory process looks like a decent alternative. But when?

Here's the problem: If you go to Congress first and Congress fails to overrule Twombly and Iqbal, then that failure will surely be invoked in the Rules Advisory process as a reason for no action. The very fact that Congress considered acting, it will be said by those who favor the status quo, shows that the pleading standard has become a political issue that should not be addressed by the technocratic Rules Advisory process. Going to the Rules Advisory Committee first avoids this pitfall but risks squandering precious time. The Mauro article indicates that the Committee is taking a wait-and-see attitude. Thus, it is extremely unlikely to complete its review before the 2010 midterm election, and after that, passage of a notice pleading restoration act in Congress is likely to be even more difficult. So starting on either track carries a substantial risk of undermining the ability to succeed on the other track should the first option fail.

Accordingly, those pro-plaintiff groups seeking to overturn Twombly and Iqbal would be well advised to proceed simultaneously on both tracks. And to do so quickly.

Posted by Mike Dorf

Monday, September 21, 2009

Was There Ever a Time When Liberals Abandoned Legislative Change for the Courts?

A recent New Yorker article by Jeff Toobin profiles President Obama's approach to picking judges and to the role of the judiciary more broadly. To summarize: 1) Obama, having come of age as a lawyer during a period of retrenchment on liberalism and conservative judicial activism under Chief Justice Rehnquist, lacks the faith in courts as an engine of social change that one sees in somewhat older Democrats; 2) he therefore has relatively little interest in pursuing a political agenda via judicial appointments; 3) this "pragmatic" approach fits well with his broader "post-partisan" vision of American politics; and 4) on judicial appointments as on just about everything else, Obama has not been rewarded by Republicans, who treat even his centrist nominees to the courts and the administration as bomb-throwing pinko practitioners of identity politics.

I agree with much of the analysis in Toobin's article, but I want to question a premise of step 1: In Toobin's account (which is quite widely believed by legal academics and others across the political spectrum), during the heyday of the Warren Court, liberals came to think of electoral politics as hostile to their interests and fell in love with the courts as the true engines of social change. Here is Jack Balkin, quoted in the Toobin article, contrasting the Obama approach with the supposed approach of the earlier period:

“You start with the premise that the political branches are the first line of defense of constitutional rights,” Balkin said. “If you think that health care is a very important right that people should enjoy, you think that the best way to enforce it is for Congress to pass a law and the President to sign it. This is a very different model from the late sixties.”

This is not at all a different model from the late sixties or any other period. Liberal reformers (like conservative reformers, for that matter) at all times use a mixed strategy: Seek change by legislation where possible and by judicial action where possible. Thus, the mid-1960s gave us our most important civil rights legislation, the 1964 Civil Rights Act and the 1965 Voting Rights Act. True, Balkin refers to the "late sixties," which presumably begin with the election of President Nixon. Is it all that surprising that, having lost the White House, liberals would place somewhat greater emphasis on the courts?

Moreover, Balkin's example is very far-fetched. With the exception of Frank Michelman's Harvard Law Review Foreword (mentioned by Toobin), very few liberal legal scholars thought that the courts could or should find a range of positive rights like health care--i.e., rights to affirmative aid rather than rights against government intrusion or denial of equality--in the Constitution. Public interest litigation organizations rarely pursued such changes in the courts, knowing they would fail. As to health care, Democrats in Congress in the late 1960s and early 1970s were working assiduously (though ultimately unsuccessfully) towards universal health care, as were some Republicans. So too, the environmental movement didn't abandon the legislature for the courts in this period, giving us the Clean Air Act and the Clean Water Act, both signed by President Nixon.

Looking at the courts themselves, as the late John Hart Ely argued at length, the Warren Court was mostly about protecting the primacy of the democratic process. In the Toobin article, Richard Epstein says that Obama's vision of the courts in constitutional cases is the Carolene Products footnote 4 view, which is, I think, a fair appraisal. But that view--which says that courts should use the Constitution to protect disadvantaged groups and the political process from the tendency of incumbents to shut out competition--is the Warren Court legacy. That was Ely's whole point, and he was right.

Really, the only plausible counter-example, and it's cited by Toobin and just about everybody else who makes this point, is Roe v. Wade. But even though Ely didn't originally acknowledge the point, many others have attempted to fit the abortion right into the equal-rights-for-women paradigm. Some people find this persuasive; others don't. The controversy over Roe shows that there are borderline cases in the Carolene Products framework. It hardly shows that the courts or Democrats have been relying on a wholly different framework.

The same exact point could be made about the one substantial expansion of liberal rights under the Rehnquist Court in Lawrence v. Texas. Though decided as a matter of "liberty," the decision as easily could have been justified--and was justified in a separate opinion by Justice O'Connor--as resting on principles of equality. Griswold v. Connecticutwas a Warren Court decision, and it is hard to understand as protection for an oppressed group rather than in libertarian terms, but it was not nearly as controversial as Warren Court decisions (such as those protecting people suspected of crime) that did fit the Carolene Products paradigm.

So yes, Obama accepts the Carolene Products framework. But that is almost entirely an embrace, rather than a repudiation, of the Warren Court and those of an earlier generation who labored in both politics and the courts.

It's true that some liberals (e.g., Ronald Dworkin, Jim Fleming, Larry Tribe, me) would go further than the Carolene Products paradigm in some circumstances, but none of us has ever said that courts should be the first line of defense for rights, that we should give up on politics, or that something like universal health care should be accomplished through the courts. Toobin, Balkin and those who accept the conventional wisdom here are fighting a straw man.

Posted by Mike Dorf

Friday, September 18, 2009

Now Is the Time to Support the Public Option

In late July and early August -- before the farcical theater of the town hall meetings had degraded the public debate on health care to lows previously unseen in this country -- I argued (here and here) that progressives who favor the adoption of a single-payer health plan should not automatically support the Public Option as the next best approach to universal care. The standard argument at that point was that there were three choices: single-payer, the Public Option, and a better-regulated private insurance system.

With single payer unfortunately (and, I would suggest, unnecessarily) having been ruled out of the debate, the choice between the two remaining alternatives was supposedly simple: anti-government conservatives would prefer the non-Public Option aspects of the extant health care reform proposals (elimination of "pre-existing condition" exclusions and other reasons to deny care, enactment of universal mandates to buy coverage, and subsidies to allow lower-income people to satisfy such mandates), and progressives and liberals (who are not "pro government" -- a term with no meaning -- but who do not reflexively believe that the government is per se worse at everything than private actors are) would gravitate toward a plan that includes a non-profit government-provided insurance plan that would be available to everyone.

My argument was two-fold: (1) The advantages of single-payer health care, especially low administrative costs, do not automatically carry over to a Public Option, and (2) Political realities would so limit the Public Option that it would (unfairly but almost certainly) become an under-funded poster child for failed government-run health care.

Underlying that argument was the assumption that the non-Public Option alternative would be a plan that would actually force private insurance companies to change their behavior, to create real competition among private insurers in regions where currently no competition exists, and with real enforcement mechanisms. If the Obama administration had negotiated well, they could have essentially given their opponents that choice: an entirely private system that no longer abused patients, etc. or competition from the Public Option. Because of the fierce opposition among conservatives to anything run by the government, such a hard bargain seemed quite achievable.

Now we have the bad joke known as the Baucus plan, which essentially gave away the store with no concessions received in return. Let's call that Choice #4, after single payer, the Public Option, and effective regulation. With single payer even further from the table, and with no effort having been made actually to design a set of rules that would rein in the worst aspects of U.S. private health insurers, we now are down to a choice between a straight giveaway to the health care-industrial complex or a Public Option. The only real choice for anyone who cares about improving health care outcomes at this point is to support the Public Option and then to do everything possible to prevent the outcome that I predicted in my earlier posts.

This, of course, should not be the set of choices with which we are faced. When our leaders squander the best opportunity for real health care reform in a generation through inaction and a willingness to ignore the will of the vast majority of the public (to say nothing of the people who actually voted them into office), however, we have to make do.

-- Posted by Neil H. Buchanan

Thursday, September 17, 2009

Lethal Injection in Ohio

On Tuesday, the state of Ohio attempted to carry out a sentence of execution against Rommell Brown, convicted of raping and murdering a 14-year-old girl 25 years ago. The attempt failed. After two hours, the executioners gave up attempting to find a useable vein through which to administer the lethal injection. (More details here.) As a result, Brown was granted a one-week reprieve by Ohio Governor Ted Strickland. What will happen now?

In 2008, in Baze v. Rees the U.S. Supreme Court held that as practiced by Kentucky, the standard "cocktail" used for lethal injections is not unconstitutional. That ruling might be thought to bar any further objections by Brown, except that Baze is best read to reject the challenge to lethal injection as it was practiced in Kentucky. The case does not stand for the proposition that any version of lethal injection is per se constitutional, nor does it foreclose the argument that lethal injection would be cruel and unusual punishment as applied to particular inmates.

Brown, it would seem, is now well positioned to make an as-applied challenge, especially because the factual basis for his claim--the fact that he does not appear to have useable veins for a lethal injection--only became available on Tuesday.

But there would be an ironic twist to any such challenge. Ohio law makes lethal injection the sole method of execution, except that Ohio may use an alternative method if:
1) Lethal injection is found unconstitutional;
2) The Ohio legislature prescribes an alternative method that is itself constitutional.

Thus, were Brown to succeed in having Ohio's system of lethal injection declared unconstitutional as applied to him, that very success would trigger the legal provision permitting his execution by a different method, should the legislature act. The irony is more apparent than real, however. The Ohio legislature could, after all, simply amend the statute so as to make a ruling of unconstitutionality unnecessary as a trigger for an alternative method (such as hanging, firing squad or Ohio's previous preferred method, the electric chair). Presumably doing so would not violate double jeopardy or the ex post facto prohibition, and it is at least a little bit odd that the Ohio legislature did not prescribe any such alternatives as a fallback when it adopted the current version of its lethal injection law in 2001.

Until the legislature acts, however, if Ohio wants to execute Brown, it has to try lethal injection, and there is no reason to think it will go any better the second (or third or fourth) time. With or without a judicial ruling, any such attempt would be cruel and unusual punishment. Thus, the Governor ought at the very least to stay Brown's execution until the Ohio legislature authorizes an alternative, and constitutional method of execution.

Posted by Mike Dorf

Wednesday, September 16, 2009

Time Isn't On Anybody's Side

Although the Washington Redskins logo is probably less offensive than the logo of the Cleveland Indians, the name "Redskins" is, if not inevitably derogatory, sufficiently so to render the trademark in that name invalid under a provision of the Lanham Act denying trademark protection to any mark that "[c]onsists of or comprises immoral, deceptive, or scandalous matter; or matter which may disparage or falsely suggest a connection with persons, living or dead, institutions, beliefs, or national symbols, or bring them into contempt, or disrepute." So said the Patent and Trademark Office (PTO) in response to a 1992 filing by Native Americans objecting to the "Redskins" name. After over a decade and a half of litigation, this past May the DC Circuit affirmed the trial court's ruling in favor of the football team on grounds of laches.

Laches, for the uninitiated, is a legal doctrine that denies recovery to plaintiffs with otherwise meritorious suits on the ground that they slept on their rights to the detriment of the defendant. It is an equitable analogue to a statute of limitations defense. In an earlier decision in the same case, the DC Circuit had ruled that the time to start counting was when the youngest plaintiff had reached the age of majority. Even so, the district court ruled, in the seven years and nine months between when the youngest plaintiff turned 18 and the petition to the PTO was filed, the football team had made substantial investments in its trademark, and so permitting the case to go forward would be prejudicial.

The May ruling found that the district court did not abuse its discretion in finding prejudice. The plaintiffs have now sought certiorari in the Supreme Court. The question whether the district judge in this case abused his discretion in finding prejudice is certainly not cert-worthy. However, the plaintiffs argue that the doctrine of laches ought not even apply in a case seeking to invalidate a trademark. Whether laches can so apply is indeed cert-worthy, and apparently the lower federal courts are divided on this issue.

Still, it's hard to see what the fuss is about on either side. Even if the football team wins, a laches ruling in its favor would not bind non-parties such as other Native Americans who have just turned 18 and who would have not slept on their rights at all. Given this, it is something of a mystery why the lawyers for the plaintiffs in this case--who are working pro bono--didn't just re-file with new, younger plaintiffs in the first place. Apparently, there is a younger plaintiff waiting in the wings. With each day that passes in the litigation of this case, she grows older, thus increasing the risk that she will be subject to a laches defense as well. Eventually, however, a plaintiff will be found who clearly avoids the laches defense.

Meanwhile, with each passing year, the notion that "Redskins" is an acceptable name for a football team grows less plausible. Thus, the football team also seems to be acting contrary to its interests in delaying a ruling on the merits. Eventually it will likely have to change its name and logo, and the longer it delays, the more likely that outcome becomes. Were I advising the "Redskins" football team, I would say change the name and logo voluntarily. Doing so would even be an opportunity to sell new merchandise to fans (which is why professional sports teams frequently change the look of their uniforms).

Posted by Mike Dorf

Tuesday, September 15, 2009

Punctuated Equilibria and Forgotten Presidents

In Bruce Ackerman's magisterial account of American constitutional history (Vol. 1 here; Vol. 2 here; no Vol. 3 yet), We the People make higher law during "constitutional moments"--that is, periods of heightened citizen engagement in politics--while during normal times, the People are largely absent from the political stage, represented only imperfectly by the democratic process.

Ackerman's approach has two distinctive features. First, it denies that formal compliance with the prior rules is necessary for constitutional moments to produce constitutional change. Thus, in each of the three leading moments--the Founding, Reconstruction, and the New Deal--the mechanism of change is dubious: The Constitutional Convention of 1787 violated the unanimity rule of the Articles of Confederation; the 14th Amendment was ratified under duress; and the New Deal made no textual change at all, even as it led to a new understanding of the roles of Congress, administrative agencies, and the courts.

Second, Ackerman's approach downplays both the significance and legitimacy of constitutional change that occurs in ordinary times and by small increments. As a number of scholars (including sympathetic and critical ones) have observed, his theory is a "punctuated equilibrium" view, rather than a gradualist one.

Yesterday, Michael Gerhardt presented excerpts of a book in progress that takes issue with Ackerman's vision (though not by name). Gerhardt writes about the ways in which 13 "forgotten Presidents"--including such figures as John Tyler, Chester Arthur, and Jimmy Carter--have influenced constitutional law. At Cornell's Constitutional Law & Theory Colloquium (which I run with my colleague Josh Chafetz), Gerhardt discussed the overview chapter and the chapter on William Henry Harrison. Harrison's Presidency is widely regarded as merely the answer to a trivia question: What President served the shortest period in office? Yet Gerhardt argues that even though his Presidency lasted a mere month, Harrison made constitutional history.

Most importantly, says Gerhardt, Harrison's brief experience--in finding it necessary to stand up to Senator Henry Clay and to his own Cabinet--set the Whig Party on the road to its own destruction, and accordingly, strengthened the Presidency itself. Whigs favored a President who was largely subservient to Congress and even subservient to his own Cabinet. Yet Harrison found that such an approach was unworkable. In asserting the primacy of the President over administration (and over the Administration) Harrison thus paved the way for the imperial Presidency.

The broader message of the Harrison chapter is unmistakable: If even this Presidential footnote could and did have an important impact on the function and meaning of the Constitution, then it is a mistake to view the periods between Ackerman's "constitutional moments" as eras of stasis.

Is Gerhardt persuasive? I think so, but that doesn't mean that Ackerman is entirely wrong. It is tempting to view the point of Ackerman's project as identifying the periods in which the constitutional order is profoundly disrupted, while Gerhardt shows how, in between, small but important adjustments are constantly being made. Ackerman shows us the big forest; Gerhardt points to the large number of trees outside the forest.

In the end, though, I don't think the forest-plus-trees synthesis can rescue Ackerman's descriptive account from his normative theory. As a normative matter, Ackerman contends that lawmaking by the People when aroused is all that legitimates judicial action in the name of the People to invalidate ordinary legislation. His theory has no normative room for profound but gradual change or profound change without the participation of an aroused people. If the modern view of the Presidency can be justified, it would have to be because it was adopted during prior constitutional moments: Perhaps the Presidency of Andrew Jackson, or Abraham Lincoln, or FDR. (Ackerman does not identify Jackson's election as a constitutional moment but one could plausibly fit it into the theory.) But then the Ackermanian account would have to grapple with the evidence that Presidential leadership was, as Gerhardt shows, developed and accepted over time.

Posted by Mike Dorf

Monday, September 14, 2009

Cass Sunstein's View of Organ Donation

Today, my column on FindLaw (here by noon) discusses some of the controversy that kept the Senate from voting on Professor Cass Sunstein's April nomination as head of OIRA until the middle of September (he came to a vote last Thursday and was confirmed).

Sunstein co-authored a book in which he suggested that we might help alleviate the organ shortage in the U.S. by assuming, in the absence of an affirmative statement otherwise, that a deceased person had been willing to donate organs to patients in need of a transplant. My column discusses the general question of "default" settings -- what we (legally and customarily) assume until told otherwise -- and how such settings manifest themselves in the contexts not only of organ donation but of medical treatment, pregnancy, and abortion as well. Selecting a default setting can reflect anticipated preferences in the real world, or it may instead reflect a policy preference. In this post, I want to call attention to the related phenomenon of presumptions in evidence law to shed light on the operation of default settings in the organ donation context.

In the law of evidence, a presumption instructs jurors that if they find some basic fact to be true (e.g., the plaintiff mailed a stamped, properly addressed letter), they must conclude that the presumed fact is true as well (e.g., the letter arrived at its destination), unless and until the party that opposes the presumption offers evidence that the presumed fact is not true (e.g., sworn testimony from the defendant that he never received the letter). As in the case of default settings in the world at large, presumptions generally either reflect things as they are (e.g., odds are that a mailed letter arrived at its destination) or "nudge" the jury toward the party that has proved the basic fact, even if the presumed fact is not especially likely to follow from the basic fact (e.g., protect life insurance beneficiaries unless there is a strong case against doing so).

Once this nudge happens, it becomes the job of the opponent to come forward and make its case rather than sitting back and automatically winning without doing anything.

With respect to the pro-donation default, a person who does not want to be an organ donor at death would have to indicate explicitly (perhaps on a driver's license, perhaps by putting it into a will), "When I die, I want my organs buried or cremated and not shared with another person whose life might depend on receiving a transplant like the one that I am denying him." Having such a default accomplishes two things. First, it makes more organs available, because many people simply go with the default, whatever it happens to be. Second, and relatedly, it forces people who wish to act selfishly -- by insisting that life-saving medical resources be buried or burned rather than given to a patient in need -- to confront that selfishness and its consequences directly.

Some of those who ultimately do not "opt out" may actually have preferred not to donate but feel a sense of shame about their inclination. Requiring an opt-out thus makes it emotionally (and perhaps socially) more costly than it would otherwise be to refuse to donate organs.

What Cass Sunstein's default switch proposal does is therefore to make explicit some of the implicit and harmful decisions that might otherwise -- and improperly -- meet no resistance. If we are to be members of a society in which we purport to care about one another's health and wellbeing, it is more than appropriate that we take steps to ensure that it is costly -- if only socially and emotionally -- to choose to be a Bad Samaritan. And it is as appropriate to place such a burden on non-donors as it is to do so to parties in the context of a trial in which some facts, once proven, shift the burden of having to come forward and offer support for a competing vision.

Posted by Sherry Colb

Saturday, September 12, 2009

They Want Big Brother Out of Their Drinking Water

I don't know whether the editors of the NY Times were acting out of a sense of irony, but I found arresting the juxtaposition of the following two stories on the front page (of the web version; in the print version there's a front-page photo for the first story):

1) A report on the rally of anti-government protesters concerned about the size of government;


2) A report on the widespread under-enforcement or non-enforcement of the Clean Water Act, to the clear detriment of public health.

I suppose it's possible that the protesters want cuts in government programs other than clean water enforcement, but I doubt it. Economic libertarians have long taken aim at environmental protection laws generally, and the EPA in particular, as examples of what they regard as government overreaching.

It's tempting to dismiss this latest protest as more of the same from a vocal but mostly marginal group. Yet the anti-government sentiment is pretty clearly the only opposition on offer from the right these days, and it is no longer a fringe phenomenon. Consider that during Wednesday's oral argument in the Hillary the Movie case, Chief Justice Roberts characterized the contention that government can limit campaign speech by corporations for the benefit of shareholders who don't support the messages promoted by the corporations as resting on the claim that "big brother has to protect shareholders from themselves."

Barney Frank rightly refused to engage with an anti-health care reform protester who carried a poster of President Obama with a Hitler mustache. But when the Chief Justice of the United States compares campaign finance regulation co-sponsored by John McCain to Orwellian totalitarianism, there is reason to think that the hyperbole has gone mainstream.

Posted by Mike Dorf

Friday, September 11, 2009

Working Backwards

Regular readers of Dorf on Law know that Sherry Colb, Mike Dorf, and I each write columns every other week on FindLaw. Typically, we write a column and then post a companion piece here discussing some aspect of the column in further detail.

For my column this week, I reversed the process. My Dorf on Law post last Thursday discussed the problem of early retirees who lose their health insurance, suggesting that there is a potential path leading from that problem to universal single-payer health care -- a destination, moreover, that would be a boon to American business.

Having received some very helpful feedback, both on the Dorf on Law comment board and in conversations with some colleagues, I expanded on those thoughts in my FindLaw Column this week. Interested readers can find it (along with a new photo of my almost-smiling face) here.

-- Posted by Neil H. Buchanan


The President's speech on Wednesday night was supposed to be his moment to take back the debate from the crazies and ignite those who support his agenda for progressive change. The worry, as Maureen Dowd again put it earlier this week, is that "the president is getting to be seen as an easy mark." The real story, however, is becoming ever more clear, and that is that Obama is not a progressive who is being rolled by his opponents but rather that he is an even worse example of a center-right faux progressive than Bill Clinton ever was.

I sampled some of the responses to Obama's speech on the Huffington Post, a reliably partisan Democratic source. Paul Begala, a former Clinton advisor, was delighted, titling his post "Why I Loved Obama's Health Care Speech." It's true that, from a purely partisan standpoint, Obama's speech should make Democrats happy. He increased the likelihood that he would get a "win" on the issue of health care, he made the Republicans look ridiculous (but not nearly as ridiculous as they make themselves look), and he sounded politically tough. According to Begala, the speech "intimidated Republicans."

As nearly everyone noticed, however, Obama did not actually take a stand on anything other than the least controversial issues in the debate. To some, this is all to the good. Jacob Heilbrunn, another HuffPost blogger, celebrated Obama's clever centrism, comparing it to the President's refusal to be too liberal in the stimulus package. "Recall that both the Republican right and progressives chastised Obama then for either doing too much or not enough. They were wrong. The economy stabilized -- and Obama gets the credit for making the right call." If you measure yourself by whether you can find people to your right and left who are angry with you -- and you're willing to declare victory on the economy in the second inning of the game -- Obama's approach is for you.

My feelings were best captured by David Sirota, who found the speech "disappointing." His list of reasons begins with the most important: "Why do Republican presidents and politicians never bash 'The Right,' but President Obama uses a joint session speech to bash 'The Left?'" One has to laugh even imagining Ronald Reagan or George W. Bush giving a speech in which they scorned their base; but it is hard to recall a time when Bill Clinton and Barack Obama were not at work distancing themselves from their supposed base of liberals and progressives. Sirota argues: "Though he didn't draw a direct equivalence, he implied there was one between the progressive push for single payer and the ultra-conservative push to destroy the entire health care system. Sick." Indeed. Even now, Obama praises Chuck Grassley and John McCain, and he talks proudly about how much he is keeping the insurance companies' gravy train running on schedule.

Readers of this blog know that I am not a fan of the Public Option. Even so, my opposition was based on a strategy in which Obama would trade a fatally flawed new government insurance plan for robust regulation and required local competition among private insurers. Instead, Obama has made it clear that the Public Option is at best something that he would approve if it happens to be in the bill that lands on his desk, with no concessions extracted from the Public Option's opponents if (when) it is dropped. Whatever bill lands there, however, he is going to sign. He made that abundantly clear.

There is no reason to be disappointed with Obama's speech unless one expects more from him. I do not.

-- Posted by Neil H. Buchanan

Thursday, September 10, 2009

Campaign Finance, Corporate Personality & Corporate Law

Based on the oral argument in the Citizens United case (which I previewed here and which is summarized nicely here), it appears that the Supreme Court is likely to overrule the precedents establishing governmental authority to regulate political speech by corporations. If so, under the Buckley v. Valeo framework, it will still be possible to limit corporate campaign contributions in the same way that individual campaign contributions can be subject to reasonable limits, but there will be no more limiting independent expenditures of general corporate treasury funds.

Perhaps the most interesting suggestion during the oral argument came from the Court's newest member. Justice Sotomayor mused that maybe the real problem is rooted in the old decisions finding that corporations have constitutional rights. (Justice Ginsburg gestured in the same direction.) Although I'm sympathetic to the goal of upholding campaign finance regulation, I think there's no realistic chance that such precedents will be re-examined.

Nor is it even clear that they should be. A corporation is an artificial entity, it is true, but so are all sorts of other organizations, including the ACLU, the NAACP, the NRA, etc., each of which pretty clearly needs to have some constitutional rights in order to protect the rights of its members. So artificiality per se is not a basis for denying (all) constitutional protections. And if the problem is that corporations are often in the business of earning profits, that point is both over and under-inclusive. Corporations can be organized as non-profits, while natural persons as sole proprietors or in partnerships can be in business.

Accordingly, the problem does not seem to be the attribution of rights to corporations as such. There are, instead, two main reasons to treat very large corporations differently when it comes to free speech. First, some of them amass such large fortunes that they can then use to swamp other voices. And second, the corporations then may end up using corporate funds in ways that do not reflect the political views of shareholders. I think it extremely unlikely that the Supreme Court will credit the first ground. As Justice Kennedy apparently noted during the oral argument, this rationale does seem inconsistent with the following maxim fromBuckley: "the concept that government may restrict the speech of some elements of our society in order to enhance the relative voice of others is wholly foreign to the First Amendment."

CJ Roberts expressed skepticism of the second argument, but even if it fails before the SCOTUS (which it probably will), it may suggest a partial way around the Court's ruling, namely corporate governance. Absent anything to the contrary in the corporate charter or by-laws, courts will typically uphold, as within the purview of management, decisions to spend corporate treasury funds on political speech. But nothing in corporate law--or the First Amendment--prevents the inclusion in corporate governing documents of something like the following: "General treasury funds shall not be used to fund political campaigns aimed at electing or defeating candidates or ballot initiatives."

In principle, shareholders might want such a provision. After all, money spent on political speech is money diverted from corporate capital (and thus share price) or dividends. However, corporate governance makes it hard for shareholders to organize and furthermore, there is a competing mechanism: Most political speech by corporations will be aimed at electing candidates or promoting platforms that benefit the corporation. The reason we worry about corporate political speech is not so much that we fear that Microsoft will try to elect pro-choice or pro-life candidates but that we fear that Microsoft will try to elect candidates who favor weak antitrust enforcement. So, even if corporate democracy were thriving, the incentives would not likely lead to my shareholder solution. So much the worse for democracy more broadly.

Posted by Mike Dorf

Wednesday, September 09, 2009

The Tiny Kernel of Sanity in the Insane Objections to Obama's Platitudinous Back to School Speech

In my latest FindLaw column, I hit the Obama Administration pretty hard for the deal it apparently struck last month with PhARMA capping drug discounts at $80 billion. Although I defend the notion of negotiating with industry over whether and how to regulate, I call the additional element of the deal--whereby PhARMA funds $150 million in pro-health-care-reform ads--problematic on free speech grounds. At the end of the column (which you should read if you want to make sense of what comes next), I invoke Thomas Jefferson's view that "to compel a man to furnish contributions of money for the propagation of opinions which he disbelieves, is sinful and tyrannical."

As I explain in the column, Jefferson's view cannot be taken literally because government routinely appropriates taxpayer dollars for programs--including programs that have speech elements to them--that some people will oppose. For example, state-funded universities appropriately teach evolution in their biology courses, even though many taxpayers disbelieve in evolution. I am tempted to rescue this example by positing that evolution is not an "opinion," but I'll resist. Instead, I'll simply refer readers to the column for the distinction I draw to try to make the Jeffersonian maxim workable.

For now, though, I'll offer an observation on a different controversy: the seemingly insane notion (which I used to introduce yesterday's post) that President Obama's back-to-school speech was an effort to indoctrinate students in socialism. I am sympathetic to the view of one commenter on that post, who opined that the Obama-is-indoctrinating-students-into-socialism objection is not even designed to make any sense as rational discourse. Still, it seems to me that there could be a certain Jeffersonian logic to it. That logic might go something like this:

1) Obama and the Dems more generally favor a greater role for government in regulating and even in running the economy than I (the hypothetical rational objector to the Obama speech) favor.

2) Such government regulation and control pushes us down the path to socialism, at least in the sense in which that word is used in the social democracies of Europe.

3) Anything Obama says that will make him more popular--even if the particular statements are not specifically pro-socialist--will in turn improve the likelihood of enacting his socialist program. Therefore, I must oppose giving him any platform.

4) It's especially objectionable that Obama is using taxpayer money and student time to achieve these ends.

I doubt that many of the objectors have articulated these or other steps, but to the extent that the objections to the back-to-school speech are anything other than blind political rage, I suspect that something like the foregoing explains their underlying structure.

Tuesday, September 08, 2009

Pres. Obama's Manifesto, and that Other One

Now that the White House has released the text of the President's speech welcoming America's youth back to school, the notion that it is some sort of socialist proclamation can be laid bare as utterly delusional. The speech extols hard work and individual responsibility as the patriotic duty of all Americans and a means towards individual self-advance that will have the side effect of improving the economy for all. It is, in essence, a bourgeois manifesto.

The irony here is head-spinning. The actual Communist Manifesto of Marx and Engels makes the opposite point. Though written over 160 years ago, the Manifesto remains a powerfully insightful document--and in its diagnostic if not its prescriptive elements--it is arguably more relevant to our times than President Obama's homey advice. Consider the core points of the opening (and to my mind most trenchant) chapter of the Manifesto:

On the economy: Capitalism, to succeed, requires ever-expanding markets, and thus globalization until it precipitates the collapse of global markets, in continual cycles of boom and bust.

On health care (and more): Under capitalism, the bourgeois imperative "has converted the physician, the lawyer, the priest, the poet, the man of science, into its paid wage laborers."

On the shrinking middle class and increasing wealth disparities: "entire sections of the ruling class are, by the advance of industry, precipitated into the proletariat, or are at least threatened in their conditions of existence."

And so on.

To be clear, Marx and Engels were wrong about some important things. To give just one example, their belief that global political struggle between the bourgeois and the proletariat would render irrelevant the prior divisions of nationality and religion has proved wildly and tragically inaccurate.

Likewise, the Manifesto's prescriptions were disastrous. There is a legitimate debate about the extent to which the totalitarian communist states of the 20th century were the logical culmination of the Marxist program or perversions of it by corrupt ruling elites that used the language of the proletarian vanguard to advance their own venal interests. I tend to take the former view, mostly because I think the test of any political idea is how it is actually implemented in the real world, but also because it is not difficult to see in the original Marxist programs the tendency towards totalitarianism. (Consider item number 6 in the Communist program as sketched by Marx and Engels: "Centralization of the means of communication and transport in the hands of the state.")

It is, therefore, understandable that many people--and especially those who themselves or whose family suffered the deprivations and persecutions of actual 20th century Communist regimes--would see in the record of Communism sufficient grounds for disdaining the Communist Manifesto as a source of any sort of wisdom. Understandable but regrettable, because Marx and Engels were in important respects astute observers of the actual functioning of capitalism. (To dissociate themselves from the Communists' affirmative political program, modern-day academic followers of Marx in the West often call themselves "Marxians" rather than "Marxists," though I suspect that the distinction is lost on Glenn Beck and his listeners.)

History has yet to prove Marx wrong in his core contention that capitalism would sow the seeds of its own destruction: For a couple of generations now, the advanced countries of the West have avoided class struggle by outsourcing proletarianism to the developing world, where wages that would be considered far below poverty level to us are regarded as a blessing. If Marx and Engels are right, this third world proletariat will eventually rise up. However, they may yet be proven wrong: Perhaps global prosperity can be achieved while bringing first-world living standards to all, although if so, it is hardly clear that the natural environment can sustain that level of consumption. Admittedly, that is more a Malthusian than a Marxian point, though one that Marx does not contradict.

As for our own politics, perhaps some good will come of the bizarre reaction against President Obama's speech: Provocative high school social studies teachers might ask students to compare and contrast Obama's message with that of the Communist Manifesto. But schoolteachers be forewarned: Doing so could get you into hot water with your principal and the parents in your district.

Posted by Mike Dorf

Monday, September 07, 2009

College Advice from the NY Times faculty

This week's Sunday NY Times Week in Review section offers advice from nine renowned faculty to new college freshmen. The shared core of the advice is sound, if obvious: Learn to write well and explore unfamiliar domains of knowledge with well-regarded teachers and your fellow students. Yet the assortment of advisers and advice is peculiar.

With the exception of two natural scientists (biologist Nancy Hopkins and physicist Steven Weinberg), all of the Times guest experts write and teach in the humanities. There are no social scientists, unless one counts history as social science. (There are two historians.) And even the two natural scientists offer bromides that could have come from specialists in any field. (Follow your passion; try new things.) Yet for some time now, more students have been majoring in business subjects and economics than any other field. Perhaps the Times deliberately omitted any representatives of these fields because, especially in hard economic times, students don't need to be told to study something practical. They need to be told the opposite.

Still, even assuming that point, some of the advice is wildly parochial. Consider Harold Bloom, who tells students that they should study "the books that survive all ideological fashion." Bloom has been much criticized for his European-male-centric definition of the canon, but his list here suffers a further flaw: Just about all of his post-classical authors produced works of imagination. He recommends Milton but not Hume or Locke, Whitman and Melville but not Freud or Darwin; Frost and Eliot, but not Einstein or Watson.

It's also telling that the Times thought to consult only professors. It's not really surprising that people who get paid for living the life of the mind would tell their new students not to worry about the practical nitty gritty of earning a living. But the vast majority of college freshmen will indeed need to worry about just that. "Easy for you tenured professors to say," I can well imagine most of the target audience saying in response to this advice. The claim that the future will take care of itself might have been more credible coming from a former English major now working as an administrative assistant or an English Ph.D. stringing together a living from three or four low-paying positions as an adjunct professor.

Finally, the Times group has a decidedly gray hue. Most of the advice givers have been teaching college for forty years or more. The oldest has been at it over sixty years. Some remarkable people can really get to know members of a younger generation on their own terms: Tom Wolfe's I Am Charlotte Simmons shows as much. Still, one might reasonably begin with a working assumption that there would be a generation gap between 18-year-olds and nine scholars ranging in age from their mid-60s to their 90s. I get that this was the point: The segment is titled "College Advice, From People Who Have Been There Awhile." But neither the editors nor any of the individual professors even mentions the possibility that the experience and wisdom of eminent faculty might be less than perfectly relevant to the world that students who could be their grandchildren or great-grandchildren will inhabit.

Having said all of that, I'll admit that I agree with nearly all of the advice. But then, it has been 27 years since I was a college freshmen and I too have the luxury of opining from an ivory tower.

Posted by Mike Dorf

Friday, September 04, 2009

Justice Stevens

The news that Justice Stevens has selected only one law clerk for the Supreme Court Term that begins in October 2010 has understandably fueled speculation about the possibility that he will retire at the end of the Term that is about to begin now. Herewith, a few thoughts:

0) By way of background, each active Justice is entitled to 4 law clerks. For many years, Justice Stevens only hired 3, although in recent years he has taken the full 4. (The late CJ Rehnquist also only hired 3, perhaps because that meant he and his clerks could play doubles tennis without leaving anybody out. Really.) Each retired Justice is entitled to one law clerk, and the law clerk for a retired Justice usually "affiliates" with an active Justice because there usually isn't enough work for a retired Justice to fully occupy that law clerk.

1) There really is no explanation for hiring one rather than his usual full complement of 4 law clerks OTHER than that Justice Stevens at least wants to give himself the option of retiring at the end of the Term. If he decides to stay on, he will have no shortage of able and willing applicants to fill out his roster. If he decides to call it quits, he won't be disappointing the 3 young lawyers thereby left without jobs.

2) Let's suppose that Justice Stevens has decided that, barring unforeseen circumstances (such as a sudden decision by another Justice to retire at the end of the 2009-10 Term), he will retire at the end of the 2009-10 Term. If so, was hiring just one law clerk the right move? On the surface, the answer appears to be yes: It is, as noted above, a mercy to the law clerks who would otherwise have expected to be clerking for Justice Stevens.

3) Or is it? Suppose an ambitious young lawyer were given the following choice: a) Accept the offer of a Supreme Court clerkship with Justice Stevens beginning in mid-2010, understanding that he will turn 90 in April, and therefore that he might leave the Court before you get to start your clerkship; or b) Not be offered a clerkship with Stevens. It's true that option a) risks setting our young lawyer up for a disappointment and disrupting her plans, but it also carries real benefits: In the past, "orphaned" clerks of this sort have often landed jobs with other Justices, including the Justice confirmed to take the departing Justice's seat. Moreover, even if not picked up in this way, the fact that our young lawyer was selected for a Supreme Court clerkship (if she can find some way to list it on her c.v.) could be a valuable credential down the road.

4) That's not to say that the choice is obvious. Taking a clerkship with Justice Stevens creates opportunity costs. Had Justice Stevens followed his usual pattern of hiring a full complement of clerks for 2010-11 in late June or early July, then the clerks accepting those jobs would have foregone other opportunities that could dry up before he announces his retirement (should he do so) next spring. Such opportunities include the possibility of a clerkship with another Justice who has not yet filled his or her roster for 2010-11 (Sotomayor, say). So if Justice Stevens was already strongly leaning towards retiring at the end of the 2009-10 Term, he might well have made the judgment that it would be unfair to offer 3 clerkships that would likely never pan out.

5) But why should Justice Stevens have made the judgment for the prospective clerks? Could he not have simply told 3 of the offerees that he was planning to retire before their clerkships started, but that he might change his mind, and then let them decide whether to take the clerkship with that risk? I think the answer is no. Such a course would have posed too great a danger of a leak and might put the prospective clerk in a very awkward position. By contrast, NOT disclosing to the offerees the likelihood of the job drying up would be dishonest.

6) All of the above leads me to conclude that it is likely that Justice Stevens thinks he will probably retire at the end of the 2009-10 Term. Why not just say so officially now? At a minimum, because doing so would yield 10 months of speculation and backstabbing over the President's next pick. Indeed, even the knowledge that Justice Stevens is likely to retire may have already sparked such activities.

Posted by Mike Dorf