The President's Authority to Fire the SEC Chair -- One Paper Makes a Correction:
After Senator McCain announced that he would fire SEC Chair Chris Cox, many media outlets (wrongly) reported that the President lacks such authority. In fact, the President can remove the Chair of the Commission for cause, and may remove a Commissioner for cause. Nonetheless, the likes of Keith Olbermann mocked Senator McCain's comments, even though McCain was essentially correct (and the NBC News correspondent upon which Olbermann allegedly relied had been told as much by yours truly the same day Olbermann went on the air).
SEC chairman: Articles in Section A on Sept. 19 and 20 about the financial rescue plan said the president could not fire the chairman of the Securities and Exchange Commission. The statute governing the SEC does not explicitly give the president the authority to fire the commission's members. However, federal courts have held that the president can remove members of independent commissions like the SEC "for cause," including "inefficiency, neglect of duty or malfeasance in office." The president can also demote the chairman of the SEC without removing him or her from the commission.
Thanks to Patterico for the pointer (and hounding the LA Times to issue the correction).
Republican vice presidential candidate Sarah Palin on Saturday accused Democrat Barack Obama of "palling around with terrorists" because of his association with a former 1960s radical, stepping up the campaign's effort to portray Obama as unacceptable to American voters. Palin's reference was to Bill Ayers, one of the founders of the group the Weather Underground. Its members took credit for bombings, including nonfatal explosions at the Pentagon and U.S. Capitol, during the tumultuous Vietnam War era four decades ago. Obama, who was a child when the group was active, served on a charity board with Ayers several years ago and has denounced his radical views and activities.
There is nothing balatantly false in this story, but it's about as one-sided a presentation of the contoversy as one could imagine; no mention that the Weather Underground planned a very deadly attack on Fort Dix; the excuse that the times were "tumultuous;" the reference to Obama being child, no reference to Obama having his inaugural political event at Ayer's house; no mention of Ayers lack of contrition for his terrorist activities; no mention of Ayers' fugitive years; no mention that Obama only saw fit to denounce Ayers' only when it became an issue in his presidential campaign, and the intentional downplaying of Ayers' and Obama's relationship to "serving on a charity board" with Ayers, as opposed to "worked closely with Ayers on a major educational reform project in Chicago." Indeed, I'd say that the last two sentences could have been written by the Obama campaign, and, in fact, that the reporter probably repeated talking points he received from the campaign virtually verbatim.
UPDATE: I'm traveling and haven't seen the New York Times piece on Obama and Ayers. It's possible that the AP reporter was just regurgitating what that story says. If so, the reporter should know better than to rely on the Times, at least in this cycle.
FURTHER UPDATE: Glancing at the comments, a lot of people want to defend Obama, but no one seems willing or able to make a serious argument that the AP story doesn't amount to a defense of Obama in what is supposed to be straight news. The fourth sentence should have simply started with "The Obama campaign ressponds," instead of putting Obama talking points into the reporter's keyboard.
Maurice Mason was sentenced to death for the rape and murder of Robin Dennis in 1994. After exhausting his appeals, he filed a habeas corpus petition alleging, among other things, ineffective assistance of counsel. In 2003, the U.S. Court of Appeals for the Sixth Circuit remanded his case to the district court ordering an evidentiary hearing on his claim of ineffective assistance of counsel during his sentencing phase due to his counsel’s alleged failure to conduct a reasonable investigation into Mason's family background. The district court held the required hearing, concluded Mason's counsel was not constitutionally ineffective, and denied Mason's petition.
On Friday, a divided panel of the U.S. Court of Appeals for the Sixth Circuit reversed the district court and granted Mason's habeas petition in an opinion by Judge Karen Moore, joined by Judge Eric Clay. According to the majority:
Although Mason’s counsel reviewed records provided by the state that contained some references to violence and drug use in the Mason family home during Mason’s childhood, Mason’s counsel failed to investigate Mason’s background and essentially conducted no interviews of any of Mason’s family members prior to settling upon a plan for the sentencing phase that was limited to appeals for mercy and claims of residual doubt. We hold that trial counsel provided ineffective assistance by failing to interview Mason’s family members and investigate the obvious red flags contained in state records suggesting that Mason’s childhood was pervaded by violence and exposure to drugs in the home from an early age.
Judge Danny Boggs dissented.
After we remanded to give the condemned exactly what he asked for, an evidentiary hearing before a federal district judge, the learned trial judge carefully reviewed the evidence presented and correctly applied the relevant federal law under AEDPA and Strickland v. Washington. Today our court continues a distressing trend of finely parsing defense counsel judgments, based on the most charitable (to the condemned) or malevolent (to the defense counsel) view of facts and holds that counsel was constitutionally ineffective. I emphasize constitutionally because in a common-sense way, counsel was of course ineffective – his client was sentenced to death. However, that is not the standard that we are to apply, and I therefore dissent.
Judge Boggs opinion concludes:
This opinion sets an almost impossibly high bar for defense counsel in capital cases. Defense counsel is now required “to locate and interview the client’s family members . . . and
virtually everyone else who knew the client and his family, including neighbors, teachers, clergy, case workers, doctors, correctional, probation or parole officers, and others” . . . ; he must interview them long enough so that those interviews can be characterized as “extensive” and “in-depth"; every conceivable family member must be contacted, no matter that defense counsel has spoken with the defendant, his wife, mother, father, brother, sister, aunt, and cousin (along with several non-family members); and he must do all this even if he reasonably believes (based on the trial
court’s rulings and his own reasonable interpretation of state law) that the introduction of any evidence regarding the defendant’s family background could open the door to truly disastrous rebuttal evidence by the prosecution. Nothing in Strickland or its progeny requires defense counsel to go to such extreme lengths in order to meet the (relatively low) threshold of “reasonably effective assistance.”
The U.S. Court of Appeals for the D.C. Circuit allowed Tyrone Hurt to file pro se appeals without paying fees, but no longer. In a per curiam opinion released yesterday, the court explained:
Tyrone Hurt has filed numerous appeals without paying any filing fees. Finding Hurt abused the privilege of proceeding before this Court without paying the usually required fees, we revoke this privilege, dismiss his forty-four pending cases and bar him from filing any future civil appeals without paying the required fees.
O.J. Simpson faces the prospect of spending the rest of his life in prison after he and co-defendant Clarence "C.J." Stewart were found guilty on 12 charges, including armed robbery and kidnapping....
The case involved a Las Vegas, Nevada, hotel room confrontation over sports memorabilia. Simpson said the items had been stolen from him....
Prosecutors charged that Simpson led a group of men who used threats, guns and force to take photographs, footballs and other items from memorabilia dealers Bruce Fromong and Al Beardsley in September 2007....
So when the judge is deciding on Simpson's sentence, may he take into account Simpson's killing Nicole Simpson and Ron Goldman, and give Simpson a longer sentence than he'd give a first offender charged with the same crimes?
Yes (as I mentioned last year), at least as a matter of federal constitutional law. In sentencing, a judge may take into account any past crimes on Simpson's part, using a preponderance of the evidence standard, even if an earlier jury had found that Simpson's guilt of those crimes hadn't been proven beyond a reasonable doubt.
The theory behind modern American sentencing, after all, is that while guilt is about what the defendant did in this case, sentencing may (and should) in part turn on the defendant's general character. That's why first offenders are often treated leniently, but people with long criminal history records are punished more harshly.
Moreover, proof beyond a reasonable doubt has never been required at sentencing. Historically, judges could make decisions based on facts that hadn't been proven in any formal way; certainly facts shown by a preponderance of the evidence suffice. For this very reason, judges could consider alleged past criminal conduct of which the defendant had been acquitted: The acquittal simply shows that the conduct couldn't be proven beyond a reasonable doubt, and doesn't preclude proof by a preponderance of the evidence.
The Supreme Court has held that in presumptive sentencing guidelines schemes, all facts relevant to enhancement (except those which can be proven through a record of criminal convictions, and civil judgments likely wouldn't suffice) need to be found by a criminal jury. But the Court specifically held that judges could find such facts whenever they are making discretionary decisions, rather than decisions under presumptive guidelines schemes.
Simpson has been found guilty by a civil jury of killing his ex-wife and Ron Goldman. (If I'm not mistaken, the jury's award of punitive damages involved a finding of guilt by clear and convincing evidence, though I don't think this is necessary to my analysis.) It's possible -- I'm not sure -- that a judge could simply rely on this past finding. But a judge could certainly enter such a finding himself based on his own review of the evidence.
And given this finding about Simpson's past conduct and therefore his moral character, the judge would be legally allowed to impose a higher sentence than he would on a typical robber, burglar, or what have you. I'm not sure whether the judge in this case would indeed act this way; but the federal Constitution would let him act this way if he so chose.
Now there might be some Nevada rules that prohibit this; I did a quick search and couldn't find any, but if any of you know Nevada law on the subject and can enlighten me, I'd be much obliged. But as a matter of federal constitutional law, a judge may (for instance) sentence Simpson to (say) life in prison for the robbery and kidnapping -- based partly on Simpson's past misconduct -- even if the judge would have sentenced a first offender only to (say) 10 years in prison.
Despite prosecutors' failure to disclose potentially exculpatory information in a timely fashion, Judge Emmett Sullivan will not dismiss the corruption charges against Senator Ted Stevens.
"Although the court is persuaded there is a . . . violation, the court is not persuaded that dismissal of the indictment or mistrial is the appropriate remedy," said U.S. District Judge Emmet G. Sullivan. He added that the government's actions had broken his trust in the prosecutors and ordered them to give Stevens's attorneys copies of all witness interviews.
"The court has no confidence in the government's ability" to meet its obligations to ensure a fair trial, he said.
But the thing is, our Founding Fathers created a system in which the vice presidency went to the Electoral College runner-up. And even though they didn't anticipate the role that political parties would come to play, they knew enough to understand that this meant that the president and vice president might well be rivals. As a result, the Constitution gives the vice president no executive role at all, other than waiting for the president to die, resign, or become incapacitated. Indeed, John Adams, our first vice president, wrote to Abigail that "[m]y country has in its wisdom contrived for me the most insignificant office that ever the invention of man contrived or his imagination conceived." The Founders didn't think that the executive role of the vice president would be flexible; they thought it would be almost non-existent.
Biden, however, kept mangling away. "The Constitution is explicit," he said. "The only authority the vice president has from the legislative standpoint is the vote, only when there is a tie vote." Well, not exactly. The vice president is always the president of the Senate--indeed, since the vice president was expected to have so little an executive role, presiding over the Senate was meant to be his day job. As Roger Sherman put it at the Philadelphia Convention, "If the vice president were not to be President of the Senate, he would be without employment." Biden was therefore right to note that the vice president's Senate vote is limited to breaking ties, but wrong to think that this constituted the entirety of his responsibilities with respect to Congress.
This was also a funny line: "Skipping over Biden's assertion that Cheney 'has been the most dangerous vice president we've had probably in American history' (a bit of hyperbole is forgivable in the midst of a campaign, but is Cheney really worse than, say, the dueling and possibly treasonous Burr?)...."
ACS Supreme Court Preview:
The American Constitution Society's Supreme Court Preview Panel has been posted online. I ended up focusing my own remarks on Herring v. United States, which I have come to think will likely be a relatively easy victory for the government. See my discussion starting around the 57-minute mark for the reasons why.
It's quite spectacular, when you think about it, that we have reached a nationwide consensus and near perfect unanimity on at least one thing: Republicans are red, Democrats blue. It's incredibly useful - pretty much every web site I've looked at with election coverage uses the same colors, and it allows the graphic design to convey lots more information than it would be able to convey otherwise. Some of you may be too young to remember, but not that long ago -- 10 or 15 years or so, by my recollection -- the two parties didn't have conventionally recognized color codes, and we were stuck with elephants and donkeys as the signifiers. It's a nice little example of a classic "tipping point" problem in social coordination; faced with a choice where (a) no one alternative is inherently "better" than another (i.e. it doesn't really matter whether you make republicans blue or red); (b) everyone will benefit from adherence to any rule, but only if everyone else abides by the same rule; and (c) nobody is in a position to dictate the outcome, how do hundreds of millions of people come to agree on any one particular rule? In this case, if my memory is correct, it started with one of the tv networks (CNN?) during one of the elections in the '90s, which gave the color scheme enough instant credibility to be picked up very quickly by others -- but however it happened, it happened pretty fast (and will probably last forever).
Co-blogger Eric Posner notes that most economists believe that the bailout passed today is not a good idea, but argues that it is still justified on the grounds that most of them still believe that it is better than nothing. I am not convinced that this is so clear. Summaries of economists' views by Alex Tabarrok, John Lott, and Lynne Kiesling suggest that many of them do not believe that today's bill was better than nothing. As I discussed in this post, I also think that the September 24 letter signed by numerous economists raised categorical objections to the bailout that have not been addressed in later bills. Readers will have to decide for themselves whether my interpretation of the various economists' statements is correct or not. [UPDATE: I'm not claiming that there is a consensus that the bailout is worse than nothing; merely that there isn't a strong consensus the other way].
The more important point, however, is that "bailout or nothing" is a false posing of the alternatives. For what little it's worth, I too believe that "something" should be done; at the very least, I don't know enough to doubt the economists' judgment on that point. It doesn't follow that the bailout was the only available "something." Had it been definitively defeated, political pressure would have grown for alternative remedies, including the "recapitalization" approach that Eric says seems to be the consensus pick of most economists. As Alex Tabarrok points out in the post linked above, "the consensus policy of economists would put most of the burden of adjustment on politically powerful holders of equity and bonds." Not only would this approach be better from a distributional point of view (putting most of the burden of adjustment onto those interest groups that played a big role in bringing on the crisis in the first place). It would also help arrest the slippery slope process towards additional bailouts for other interest groups that the bill passed today is likely to generate. Interest groups would hesitate to lobby for bailouts of their own if they knew that they would have to pay most of the cost of any bailout themselves.
As Lynne Kiesling suggests (here and here), the rush to the bailout may be a classic instance of powerful concentrated interest groups (the finance industry, big investors, possibly other industries hoping for later bailouts of their own), triumphing over a less well-organized general public. If the bailout had been taken off the table, these groups might well have been willing to support alternative proposals to address the crisis that would have placed fewer burdens on the general public and had fewer interest group giveaways attached. Forced to choose between A) letting the crisis continue, and B) recapitalization that they would have to (largely) pay for themselves, the interest groups would likely opt for the latter (assuming that the crisis really is as severe as Eric and others claim, which I think is probably true).
An obvious objection is that any alternative bill would have taken too long to put together. But if Congress was capable of cobbling together the bailout bill within a few days, I don't see why it could not act just as quickly on an alternative - especially given the political pressure for it do so that would have resulted from a definitive defeat of the bailout.
Maybe there is something I am missing here. Certainly, I'm not thrilled about disagreeing with a law and econ scholar of Eric's stature on this question. While I am no expert on the economics of banking, I do know a good deal about the literature on ways in which interest groups and governments take advantage of crises to expand their power. And I fear that this crisis poses a serious danger in that respect. If finance economists across the political spectrum really did believe that the bailout is the best available policy choice or close to it, I wouldn't have anything to say about it. But, as far as I can tell, that doesn't seem to be the case.
The Constitutionality of Same-Sex Visitation Rights:
Ruth Marcus of the Washington Post points out another moment that had me rolling my eyes and asking "What the heck is he talking about now?" in his free-form constitutional explorations last night:
In every debate, there are odd moments that tend to pass unnoticed because they do not concern the central issues of the day. Thursday night’s vice-presidential debate featured two such episodes. In one, Sen. Joseph Biden was illogical on the matter of gay rights.
“Look, in an Obama-Biden administration, there will be absolutely no distinction from a constitutional standpoint or a legal standpoint between a same-sex and a heterosexual couple,” Biden said in answer to a question about whether he supported equal benefits for same-sex couples. He went on to invoke the Constitution three more times. “The fact of the matter is that under the Constitution.... same-sex couples should be able to have visitation rights in the hospitals, joint ownership of property, life insurance policies, et cetera. That's only fair.” And, “It's what the Constitution calls for. And so we do support it. We do support making sure that committed couples in a same-sex marriage are guaranteed the same constitutional benefits as it relates to their property rights, their rights of visitation, their rights to insurance, their rights of ownership as heterosexual couples do.” Italics added.
Biden cannot actually mean what he says -- because the implications of his statement contradicts his (and Barack Obama’s) asserted position opposing marriage for same-sex couples. (They support civil unions, which Biden forgot to mention.) Alternatively, he may mean what he says -- but simply be unwilling to acknowledge that the consequence of that view is that the constitution protects the right of same-sex couples to marry. Either way, it’s inconsistent to make the argument that there is a constitutional right to be free of discrimination as a gay or lesbian person and to oppose gay marriage.
Leaving aside the point Marcus makes, I was not aware that there was a constitutional right to same-sex hospital visitations. I was even less aware that such a constitutional right existed because "it is only fair." Or, at least, I think that's his argument, isn't it?
She also notes the incoherence of his answer on the Vice President point.
The other moment in the debate that struck me as quite strange was Biden's comment that he is certain that all global warming is manmade and that manmade global warming is what is melting the polar icecap:
BIDEN: Well, I think it is manmade. I think it's clearly manmade. And, look, this probably explains the biggest fundamental difference between John McCain and Barack Obama and Sarah Palin and Joe Biden — Gov. Palin and Joe Biden.
If you don't understand what the cause is, it's virtually impossible to come up with a solution. We know what the cause is. The cause is manmade. That's the cause. That's why the polar icecap is melting.
A UN panel of 2,500 scientists from more than 130 nations said it was "very likely" — or more than 90% probable — that human activities led by burning fossil fuels explained most of the warming in the past 50 years.
It goes without saying that "90% probable" that "most warming" is caused by human activities, that is not the same as "we know" that "the cause" of all warming is manmade.
Palin's answer was much more nuanced and consistent with science (not to mention being absolutely correct about what to do it about it as a policy matter, focus on the impacts and the mix of policies to respond to climate change):
I'm not one to attribute every man — activity of man to the changes in the climate. There is something to be said also for man's activities, but also for the cyclical temperature changes on our planet.
But there are real changes going on in our climate. And I don't want to argue about the causes. What I want to argue about is, how are we going to get there to positively affect the impacts?
It is obvious that there are cyclical temperature changes on the planet (in addition to other natural variances, such as sun spots, cloud cover, etc.). We have had ice ages and tropical periods. I have tried to find some nuance or qualification in Biden's statement that he understands the difference between "all" and "most" or the possible role of natural causes, but I don't see it. He seems to just be wrong about his understanding of what the science actually says on this point. And again, his strident confidence and patronizing attitude seems completely unfounded (as with this assertions about the legislative role of the vice president).
I know people who have always been pro-life or pro-choice and haven't changed their positions. I understand their logic there. I also know a lot of people who have gone from being pro-choice to pro-life, often prompted by having a child or a religious experience that causes them to come to believe that a fetus is essentially a child. I can understand the logic there too.
But I've never met (or at least talked to) anyone who has gone from being pro-life to pro-choice. I am sure there are people who have done so (I'm not including politicians who have done so for political expediency). If there are any readers out there who have made this migration (there must be), I'd be interested in hearing how that transition came about. In particular, what arguments did you find persuasive in changing your view on the morality of the issue?
Interestingly, when I search on Google, I find numerous pages on "How I became pro-life" and very little on "How I became pro-choice."
Although this is the blogosphere, I'm looking for serious introspection here, as I'm trying to understand how thoughtful and morally-serious people think about this question.
One of the most bizarre (to use Sen. Biden's term) episodes during the debate was Biden's response to the question of whether the Vice-President has a legislative role. His response:
IFILL: Vice President Cheney's interpretation of the vice presidency?
BIDEN: Vice President Cheney has been the most dangerous vice president we've had probably in American history. The idea he doesn't realize that Article I of the Constitution defines the role of the vice president of the United States, that's the Executive Branch. He works in the Executive Branch. He should understand that. Everyone should understand that.
And the primary role of the vice president of the United States of America is to support the president of the United States of America, give that president his or her best judgment when sought, and as vice president, to preside over the Senate, only in a time when in fact there's a tie vote. The Constitution is explicit.
The only authority the vice president has from the legislative standpoint is the vote, only when there is a tie vote. He has no authority relative to the Congress. The idea he's part of the Legislative Branch is a bizarre notion invented by Cheney to aggrandize the power of a unitary executive and look where it has gotten us. It has been very dangerous.
This statement contains several errors. Glenn Reynolds sums it up (I don't think it necessary to belabor the point beyond his crisp analysis):
And, yes, the VP's legislative duties are in Article I. But that cuts precisely against the point that Biden was trying to make. Here's what Biden said: "Vice President Cheney has been the most dangerous vice president we've had probably in American history. The idea he doesn't realize that Article I of the Constitution defines the role of the vice president of the United States, that's the Executive Branch. He works in the Executive Branch. He should understand that. Everyone should understand that. . . . The only authority the vice president has from the legislative standpoint is the vote, only when there is a tie vote. He has no authority relative to the Congress. The idea he's part of the Legislative Branch is a bizarre notion invented by Cheney to aggrandize the power of a unitary executive and look where it has gotten us. It has been very dangerous."
This is wong on multiple levels at once. Article I — which deals with the legislative, not the Executive branch, says: "The Vice President of the United States shall be President of the Senate, but shall have no Vote, unless they be equally divided." The Vice President presides over the Senate by right, whenever he/she wants to, regardless of whether there's a tie vote.
What's more, Vice Presidents, until Spiro Agnew, got their offices and budgets from the Senate, not the Executive Branch. The legislative character of that office is traditional — treating the VP as part of the Executive Branch, and a sort of junior co-President, is a recent and, to my mind, unwise innovation. That's discussed at more length in this article from the Northwestern University Law Review.
Biden is just plain wrong about this. First of all, Article I defines the legislative branch, including its composition and the scope of its powers and the powers and privileges of its members. Article I, sec. 3, clause 4 is the first time the Vice President is mentioned in the Constitution. It gives the Vice President an important role to play:
The Vice President of the United States shall be President of the Senate, but shall have no Vote, unless they be equally divided.
The Constitution goes on to direct the Senate to chose a President pro tempore to preside over the Senate in the VP's absence. Though it is not explicitly stated, the VP is also the President of the Senate during all trials of impeachments other than trials of the President. In other words, when Biden says that the VP has "no authority relative to the Congress" the truth is actually that the VP has a special authority, reserved to no other unless the VP chooses to let another wield it.
Article II does not extend to the VP any executive powers. Sections 2 and 3 specifically grant duties and powers to the President; the VP goes unmentioned. In fact, Article II provides for compensation for the President, but doesn't direct the VP to receive anything!
So far today, I've seen no mention of this gaffe in any of the mainstream media coverage. Surely if Palin had stated that the Executive Branch is defined in Article I of the Constitution--especially in such an imperial tone--we would've heard about it. Moreover, Biden apparently believes that somewhere in the Constitution the duties of the vice president are expressly and extensively described. So even if he actually knew the difference between Article I and Article II it seems quite evident that he has not the faintest clue as to what the Constitution actually says or does not say about the powers and responsibilities of the vice president.
From watching judiciary committee hearings on judicial nominations over the past two decades I had always assumed that Biden just didn't really care about the text of the Constitution. Now I learn the reason he doesn't care is that he apparently doesn't even know what the Constitution says. Although, somewhat frighteningly, he seems extremely confident that he does know what it says.
The larger lesson, of course, is that if one plans to provide a condescending lecture on consitutional law--i.e., Dick Cheney "should understand that"--you really really need to make sure you know what you are talking about.
On re-reading, I see that my intended snarky joke comment that Biden doesn't know what the Constitution says came off more sarcastic than snarky. Sorry if it came off the wrong way. We can file this under an "attempt at a lame joke" as well.
We'd like to improve out site search feature. Right now, we use a free version of PicoSearch, but that doesn't really work well, since it limits the number of indexed pages and doesn't automatically reindex. We could probably solve those problems by upgrading to a pay version ($250 or $500 per year), and we're willing to pay for a system that works well, especially since we often want to search the site ourselves.
But we're just not sure what's the best solution for our particular setup:
(1) We have our post-May-2004 archives in pages under the http://volokh.com/archives/ directory and our 2002-to-May-2004 archives in pages linked to from http://volokh.com/volokh_archive.html, named things like http://volokh.com/2003_11_16_volokh_archive.html (though I'm sure we could move them to the archives directory if necessary). Each archive, though, has lots of posts.
(2) We have each individual post-May-2004 post in the http://volokh.com/posts/ directory, but together with comments.
(3) (a) We'd prefer to have our search facility find only words in the posts, not the comments (for searches including comments, a Google search for site:volokh.com ... should do the job), but (b) we don't want the search to find words across multiple posts on the same archive page. The trouble is that preferences (a) and (b) seem to be in some tension -- searching through the archive pages satisfies (a) but not (b), and searching through each post page satisfies (b) but not (a). Surely there's some technical way to do both, partly because the comments are clearly delimited from the post text in the HTML. But I'm just not sure which search tools take care of that.
So I'd love to get whatever advice you folks might have. Thanks!
Now that the VP Debate is behind us, I'm actually relieved that it produced no stunning gaffes or garbled nonsense from either candidate. Biden was solid, and Palin did not sound as hopelessly out-of-her-league as she did when talking to Katie Couric.
Good. We can, perhaps, take a collective deep breath. We all know what we need to know about Palin, one way or the other. Those who think (like me) that she is not competent to be President of the United States saw nothing last night to suggest that she is, while those who think otherwise, I’m sure, feel that her performance vindicated their view. No “game-changers,” as they say, so we can turn our attention away from questions about the virtues of small town life, moose hunting, and whether Sarah Palin reads newspapers or not, and return to the only real question that matters in this election: Who is going to get the United States out of the colossal and potentially catastrophic mess it finds itself in at this moment? Anyone not terrified by the news from the financial markets isn’t paying attention. This election looks so much like the 1932 election it’s eerie. The Republicans have been in power for a considerable period of time. The Stock Market has crashed, and the champagne has stopped flowing on Wall Street. A liquidity crisis is looming; in the old days, when things moved more slowly, it took several years to set in, but we’re unlikely to have that long a window this time. The Democrats have nominated the Brilliant Orator (whom many belittle as some kind of effete intellectual snob, or even a “socialist”); the Republicans have put forth Herbert Hoover – a very smart and capable man without much of an idea about what has gone wrong with the economy or how to fix it. (McCain even looks like Hoover, for crying out loud). The '32 election changed the course of the 20th century. So if we’re going to argue about something (and we are, and we should), that’s what we should be arguing about.
No! You might think otherwise from various incautious commentaries, including the economist’s letter written a while back. (The letter said "go slow"; it didn't say "do nothing.") And it is true that most economists don’t like the original Paulson plan, and also don’t like the plan passed by the Senate. But the view that we are currently in a serious financial crisis—the worst since the Great Depression—is, as far as I can tell, unanimous. The view is based on readily accessible data on the credit crisis—including the TED spread—and overwhelming anecdotal evidence of financial institutions failing or hoarding capital and businesses having trouble obtaining credit. And the view that the government should engage in a massive intervention of some sort is nearly unanimous. The idea that governments should address financial crises by injecting liquidity in the system is not some new-fangled idea dreamed up by socialists, but conventional wisdom, proved again and again by experience, going back many decades. The problem is that every economist has his own theory about the proper solution. There is some convergence on the idea of recapitalization of financial institutions, which the current bill authorizes only indirectly (but which the Fed already has authority to do, as we saw with AIG), but otherwise there are as many views as there are economists.
Here is the problem. You are a member of Congress, and neconomists tell you thatthey don’t like the bill you are about to vote on. When you ask these economists what the better approach is, you get ndifferent answers. When you tell them that your only real choice is to vote up or down on this bill, they tell you that this bill is better than nothing. I have found plenty of criticism of the various plans by economists on the web, but it is very hard to find a single mainstream economist (the closest is thisone, but even he thinks something should be done) who unequivocally states that we will be better off with no regulation than with a flawed plan.
I don't think that Sarah Palin did badly in the debate tonight. But at the same time, I do have to say that I'm not particularly impressed with her overall performance over the last few weeks. Certainly, I'm not as optimistic about her as I was in this post in August. As in August, I'm only modestly concerned about her lack of experience (though it would be better to have a Veep nominee with greater foreign policy background, as I pointed out at that time). But I am somewhat disturbed by her apparent lack of knowledge about various important issues.
I'm not going to go through the litany of her various gaffes. They have been extensively documented elsewhere. Taken individually, many of them are probably defensible - explicable by her getting tongue-tied or having a bad day or other random factors. However, the sheer number of them does suggest that she really does lack knowledge on some of these issues and that the gaffes are not just aberrations (or at least that many of them aren't).
As I have said before, my main reason for viewing a McCain-Palin victory as the lesser of evils in this election is that it is the only way to maintain divided government, which I view as an important obstacle to growth in the size and scope of government; it is particularly important given the extensive big government agenda outlined by Barack Obama, which he will be able to implement with the help of a strongly Democratic Congress. I also still think that Palin is more libertarian then most other major-party politicians, though she certainly ran away from that with her populist rhetoric in tonight's debate (probably for tactical reasons).
At the same time, ignorance about major domestic and foreign policy issues is a negative for a leader who, if McCain wins, will be within a heartbeat of the presidency - a presidency held by a 73-year old man whose health could deteriorate. No president can actually be an expert on the full range of issues faced by modern government; there are far too many of them. But it is important for him or her to have a basic knowledge that on some important issues Palin seems to lack. Palin probably has the ability to increase her knowledge. Ignorance, as I have often pointed out, is not the same thing as stupidity. She is a capable politician who has been successful in previous offices. However, other things equal, I would prefer a VP who doesn't require on the job training.
I don't think that Palin's weaknesses on this point should be decisive in choosing whom to vote for this fall. There are too many other vastly more important issues. Even when I was more positive about Palin than I am now, I still said that her "presence on the [Republican] ticket" made it only "marginally more appealing" to me. However, because I did give a more positive assessment of her in this space in the past, I thought it would be appropriate to share my revised views. At this point, what was once in my mind a marginal positive is at best a wash; her libertarian tendencies are to a large extent offset by her apparent ignorance on various key issues. Among other things, that ignorance would make it more difficult for her to influence policy in a libertarian direction in a McCain-Palin administration.
I watched a bit of the post-debate spin at FOX News, CBS, and ABC. CBS and ABC couldn't have been more different from FOX. The spin from commentators was pro-Palin at FOX and pro-Biden at CBS and ABC.
The Frank Luntz focus group results were stunningly strong for Palin.
At CBS, on the other hand, the instant poll of "uncommitted" voters showed 2-to-1 reporting that Biden won.
Once again, we need to integrate newsrooms politically to get truly balanced reporting.
By the way, I thought that, by conventional measures, Biden won the first third fairly clearly, while Palin was even or ahead in the last two thirds of the debate. If I had to pick an overall winner, I would lean slightly toward Biden, though Palin exceeded expectations more clearly than Biden.
So if pundits' evaluation of the first presidential debate as a near-tie was spun as a win for Obama, then if pundits end up evaluating the vice presidential debate as a near-tie should that be spun as a win for Palin? Or should we stop declaring a winner at all and talk more about what we've learned?
Clinton on Banking Deregulation & the Financial Crisis:
Some have argued that deregulation of the financial services industry, and the 1999 Gramm-Leach-Bliley Act which repealed the Glass-Steagall Act of 1933 in particular, caused or contributed to the current financial crisis. In a recent iterview, BuisnessWeek asked President Bill Clinton, who signed Gramm-Leach-Bliley into law, whether he shared that view.
BW:Mr. President, in 1999 you signed a bill essentially rolling back Glass-Steagall and deregulating banking. In light of what has gone on, do you regret that decision?
Clinton:No, because it wasn't a complete deregulation at all. We still have heavy regulations and insurance on bank deposits, requirements on banks for capital and for disclosure. I thought at the time that it might lead to more stable investments and a reduced pressure on Wall Street to produce quarterly profits that were always bigger than the previous quarter. But I have really thought about this a lot. I don't see that signing that bill had anything to do with the current crisis. Indeed, one of the things that has helped stabilize the current situation as much as it has is the purchase of Merrill Lynch (MER) by Bank of America (BAC), which was much smoother than it would have been if I hadn't signed that bill.
BW:Phil Gramm, who was then the head of the Senate Banking Committee and until recently a close economic adviser of Senator McCain, was a fierce proponent of banking deregulation. Did he sell you a bill of goods?
Clinton: Not on this bill I don't think he did. You know, Phil Gramm and I disagreed on a lot of things, but he can't possibly be wrong about everything. On the Glass-Steagall thing, like I said, if you could demonstrate to me that it was a mistake, I'd be glad to look at the evidence. But I can't blame [the Republicans]. This wasn't something they forced me into. I really believed that given the level of oversight of banks and their ability to have more patient capital, if you made it possible for [commercial banks] to go into the investment banking business as Continental European investment banks could always do, that it might give us a more stable source of long-term investment.
Just a quick personal word on Gwen Ifill as debate moderator and her possible bias on the debate. I appeared on The Newshour one night with her to discuss bankruptcy reform. I found her to be eminently fair and well-prepared. She understood the key issues and asked pointed questions for both myself and the other guest. Based solely on the broadcast I would not have been able to discern what her position was. But of all the interviews I've done with the media, I founder her to be one of the smartest and most even-handed interviewers that I've dealt with.
You can't necessarily extrapolate from my experience because she just may not have felt strongly about bankruptcy reform (how can that be!), but based on my experience with her, she seemed really smart, well-prepared, and fair.
U.S. District Judge Emmet Sullivan suspended the trial of Alaska Sen. Ted Stevens Thursday morning, after it was revealed in court that prosecutors withheld FBI records that could have aided in Stevens' defense. The Republican senator's lawyers at Williams & Connolly immediately called for Sullivan to dismiss the case.
The records in question showed that the government's star witness, former VECO CEO Bill Allen, told federal investigators that he believed Stevens would have paid for the renovations he is accused of omitting on his financial disclosure forms if the senator had received the invoices. The government waited until last night to hand the records over, which Brenda Morris, the lead prosecutor, imputed to "human error."
"It strikes me that this was probably intentional. I find it unbelievable that this was just an error," Sullivan said.
John Lott reports that although there is wide disagreement among economists about the need for action with respect to the economy, there is uniform skepticism about this particular bailout package.
Interviews conducted with a dozen prominent academic economists, Obama supporters as well as McCain supporters, found little support for the bailout bill. Indeed, even the one economist who supported the proposal passed by the Senate Wednesday night had serious reservations.
Economists might be known for disagreeing with each other, but there is surprising agreement regarding the bailout and the causes for the current financial problems. There was no support for the broad bailout being discussed in Washington, and the economists believed that the same outcome could be achieved at much lower cost to the taxpayers.
Powerblogs doesn't seem to be allowing me to post a link to the column so here's the url: http://www.foxnews.com/story/0,2933,431645,00.html
I found it odd that Palin could not name another Supreme Court decision with which she disagreed. After all, we know that she is aware of at least one Supreme Court decision other than Roe v. Wade with which she disagrees. Just over a month ago she criticized the Supreme Court's decision in the Exxon Valdez case, slashing the punitive damages awarded by the trial court. So did she simply freeze up and forget? Was she afraid of a 'gotcha' comeback if she named a specific case? Or is she that much of a knucklehead that she can't even remember what she thought of the Court several weeks ago? My read of the video is that the first is most likely, but I'm sure others will disagree.
Biden, the constitutional law scholar and former Chair of the Senate Judiciary Committee, spoke more smoothly and authoritatively on the issue. Yet while his defense of Roe may have sounded thoughtful at a superficial level, it was actually quite incoherent. Instead of saying that he thinks the abortion right is a fundamental liberty that deserves constitutional protection — which he only hinted at later, and would be a more straightforward way to defend Roe and an abortion right under the Constitution — Biden explained that the Court's decision is "as close to a consensus that can exist in a society as heterogeneous as ours." Setting aside his focus on Roe, and his description of Roe's initial holding as if it were still the law of the land and had not been supplanted by Casey's "undue burden" test, his rationale is problematic on several levels, particularly for someone who holds himself out as an expert on constitutional law.
First, if the aim is a rule that embodies or approximates a national "consensus" on an issue, there is no reason to believe that the imposition of a uniform constitutional mandate by the Supreme Court is more likely to embody such a consensus than will the action of the legislature. Not only is the Court less responsive to popular opinion than the legislature, Supreme Court decisions are also more difficult to change than statutory enactments. Thus, even if a the Court gets it right at a given point in time, it is exceedingly unlikely that the Court's unaltered judgment will reflect a social consensus over time. If, as Biden claims, the aim is to embody or approximate the social consensus, one has to take into account the fact that popular opinion shifts, but Roe does not.
Second, if the aim is to have abortion laws that come as close as possible to embodying public values and preferences, any nationally uniform rule, whether permissive or restrictive, is less optimal than leaving the matter to the separate states. Allowing individual states to adopt their own rules will result in a greater percentage of the public living within a jurisdiction that imposes abortion rules with which they agree. To illustrate, consider a hypothetical nation with two states of equal populations. The national preference in favor of permissive abortion rules is 60% to 40%. But in State A the preference for permissive rules is 75% to 25% and in State B the preference for more restrictive abortion rules runs 55% to 45%. With a national rule reflecting popular opinion, 60% of the people live under a rule they support. Allowing each state to adopt its own rules, however, results, in 65% of the people ((75+55)/2) living under a rule they support. So, if the aim is a set of rules that reflects "consensus" within a heterogeneous society — and this is the premise that Biden himself provided in the interview — then the federalist approach is superior to a national rule, such as that embodied in Roe (or, for that matter, a national rule embodied in a constitutional amendment, such as the proposed "Right-to-Life Amendment.")
My point is not that Biden is wrong to defend Roe. It may be difficult to defend the reasoning of Justice Blackmun's opinion, but reasonable people can and do disagree over whether the Constitution should be read to protect an abortion right, as well as on the question of whether Roe should be upheld on precedential grounds. Rather my point is to show that the basis upon which Biden chose to defend Roe — the desire to approximate "consensus" in a heterogeneous society — cannot justify the outcome he seeks to defend, and reflects a poor understanding of our constitutional system (particularly for someone of his background). While Biden speaks about these issues with in an authoritative manner, and has substantial experience discussing and debating constitutional questions, the substance was sorely lacking in this interview.
UPDATE: Brian Kalt has more thoughts on the interviews here. His conclusion:
I would have been much happier if Palin had given better answers to Couric. But her lack of knowledge of constitutional law would assumedly lead her to rely on others for advice on such matters. She doesn't know, but surely she realizes it. Biden, by contrast, has the smooth confidence of someone who has been immersed in these issues for decades. But he's wrong. To me, that's actually scarier.
I generally like the Judicial Confirmation Network and the function they serve. But their latest ad on whether we can trust Obama to appoint judges because of his relationships with Tony Rezko, William Ayres Ayers, and Jeremiah Wright strikes me as utterly illogical and just dumb. I guess we're supposed to draw from this that Obama has poor judgment? But surely it is a stretch to go from Tony Rezko raising money for Obama to saying that we can't trust Obama to appoint judges.
Surely there's got to be a more serious and effective way of addressing concerns about Obama's judicial selections than by bringing up Jeremiah Wright again.
As a reminder, the University of Minnesota Law School is hosting its first annual conservative/libertarian colloquium tomorrow from 1:30-3:30pm in Rm. 25 at the law school. It's on the topic of the role of precedent in constitutional law. It features, among many outstanding speakers, the VC's own Orin Kerr. All are invited to attend and we've applied for 2.0 CLE credit hours.
The internet has been buzzing with charges that tonight's debate moderator, Gwen Ifill, has a conflict of interest because she is writing a book, The Breakthrough: Politics and Race in the Age of Obama, that is due to be released on inauguration day in 2009. If nothing else, it creates the appearance of a conflict of interest, much as would a journalist's participation in a political rally or partisan political activity. This is the view taken by the Columbia Journalism Review:
Gwen Ifill has done solid, important journalism. She’ll likely be a good, tough, and neutral moderator to the vice-presidential debate. Let’s set that aside, for now.
Conflict of interest is often about appearances. There appears, to us, to be a conflict in Ifill moderating tomorrow night’s vice presidential debate.
The CJR also suggests that the potential financial interest in an Obama victory may raise a different sort of conflict issue than prior debate moderators' personal affinities or preferences for individual candidates (e.g. CBS' Bob Schieffer's friendship with George W. Bush).
I think CJR is correct that there is an appearance of a conflict. I also think that Ifill should have disclosed the book project and its title to the Presidential Debate Commission (which she apparently failed to do). But I also think that the debate should go on with Ifill as the moderator, and partisans of either stripe should wait and see how Ifill performs before casting judgment. Like all professional journalists, she is expected to put aside her personal views and interests when doing her job, and if she is less-than-neutral in her performance tonight, it will be out in the open for us all to see. In sum, any conflict of interest, whether real or perceived, should have a minimal effect because the voting public will be able to evaluate Ifill's fairness for themselves when watching tonight's debate.
Sorry to trouble you folks with yet another user interface poll, but I wanted to ask what you thought about the format for post titles. We're experimenting with large and small caps, as you can see above [UPDATE: actually, as you could have seen above, but I've changed to bold now], but there are other options, as you can see in coming paragraphs.
FORMAT FOR POST TITLES: Sorry to trouble you folks with yet another user interface poll, but I wanted to ask what you thought about the format for post titles. We're experimenting with large and small caps, as you can see above, but there are other options, as you can see in this paragraph.
Format for Post Titles: Sorry to trouble you folks with yet another user interface poll, but I wanted to ask what you thought about the format for post titles. We're experimenting with large and small caps, as you can see above, but there are other options, as you can see in this paragraph.
Illegal To Use Nonlethal Self-Defense If You Can Safely Retreat?
As I blogged last year, in a very few states, it's illegal to use even nondeadly self-defense if you could safely retreat from the fight (and even if you weren't at all culpable in starting the fight).
There's a hot debate about whether you should be able to use deadly self-defense when you could safely retreat, with most U.S. states saying "yes" but a substantial minority saying "no." I had thought, though, that the uniform rule was that you could stand your ground and use nondeadly self-defense, regardless of whether you could have avoided the problem by running away. But a very few states take the opposite view.
In any case, this arose in the case of Michael Mette, an off-duty Chicago police officer, who was sentenced to 5 years in prison in such a situation; this is what prompted my original post, which has more details. Today, the Iowa Court of Appeals reversed Mette's conviction. The court applied the Iowa rule that you can't use even nonlethal self-defense if you can retreat, but found that
[T]here is absolutely no testimony from any of the witnesses to support the district court’s findings:
What the defendant failed to do however, was to retreat from the situation to avoid any problems. All any of the six had to do was get in the car, go inside the house, or walk away and call the police about the disturbance.
After being pushed and knocked backwards two or three times, there was nothing in the record to indicate Michael could have avoided Gothard’s next blow, without his defensive punch. While it may be possible to speculate on Michael’s ability to retreat, the record is utterly void of any testimony to support that assumption.
Since in Iowa, as in all states except Ohio, the prosecution must disprove self-defense beyond a reasonable doubt (in Ohio, the defendant must prove self-defense by a preponderance of the evidence), and the prosecution hadn't discharged its burden of proof, the conviction was reversed.
Many commentators responded to my earlier post along the following lines (this passage is from timd):
Bush, Paulson, Bernanke, Pelosi, Obama, McCain - None of them have presented the facts in a way that makes it clear (a) which current symptoms are indicating the potential for a meltdown, (b) what a meltdown would look like exactly, (c) why the government's actions would make a meltdown less likely, and (d) why the unintended negative consequences of government action are unlikely to outweigh the positives.
But can the administration realistically satisfy the demand for specificity and evidence – with respect to both the claim that a crisis exists and that a particular plan will succeed? Think back to the summer of 2001, when the government had reason to think that a major attack would occur in the near future (I borrow this example from Commenter commontheme). What could the government have said that would have persuaded you to agree to a costly or otherwise troubling policy that could be justified only on the basis of a serious threat (immigration restrictions, for example, or the use of military force in Afghanistan)? “We’ve heard a lot of ‘chatter’ that might or might not mean that an attack is imminent,” the honest government would say. “We can’t reveal it to you without compromising our intelligence methods, however, and anyway it’s in Arabic and it would be difficult to explain how we verify the information.” And: “we can only say that the policy we advocate might reduce the risk of an attack but we can’t guarantee it.” Satisfied?
The current case is similar. The TED spread is at a historic high but few people know what that means (it’s a measure of how scared banks are, based on the interest rates they demand when loaning to each other), nor is it clear how high is too high. Various enormous financial institutions in the United States and around the world have failed but it is not clear that more would or that their failure would result in a contagion effect that caused serious long-term harm to the economy. The Fed no doubt has data and models but probably can’t reveal them without spooking the markets further and revealing proprietary information, and in any event would have no ability to explain the data and models to your satisfaction. No one knows what will happen if no bailout occurs—could be Great Depression #2 or a mild recession. And no one knows what will happen if a bailout occurs. In this way, the bailout bill is just like Richard Clarke’s proposal to send cruise missiles to blow up Osama bin Laden before 9/11—except that today we have better data, a consensus among political leaders, and more-or-less agreement among experts (those economists who signed that letter seem to be less and less vocal with each passing day; in any event, they did not so much oppose a bailout as oppose the Paulson bill and advocate greater deliberation before legislative action).
I ought to point out that, in any event, the Fed and Treasury have already made plans to go ahead and lend all the money that you thought Congress had voted down. They are doing so because Congress gave them the authority to do this in statutes enacted long ago, and charged them with the responsibility of resolving financial crises, which is exactly what they are trying to do. It is odd that the critics of the bill are not trying very hard to persuade the Fed to back off. What the Fed and Treasury want from the bailout bill but are not getting (so far) is additional political backing to help restore confidence in the financial markets. One might think that if all this money is going to be spent anyway, the case for the bill, which provides for additional tools and oversight, is rather strong.
Indian grandmaster Vishwanathan Anand describes his preparations for an upcoming world championship match against Russia's Vladimir Kramnik:
I have been studying Kramnik since the end of April, up to ten hours a day, here at home in my cellar, where I have my office. I have a database and construct game plans. I try to neutralise positions in which Kramnik is strong. He is doing the same thing with my game, which I must of course take into consideration. Let me put it this way: I must remember that he is thinking about what I am thinking about him.
Anand is focusing his preparations on positions where Kramnik is known to be strong based on previous performance. But knowing this, Kramnik could choose to play positions that he hasn't much used in the past or ones where his previous performance wasn't good; Anand might be unprepared for these openings and Kramnik could win by taking him by surprise. Of course, Anand could take account of that possibility and therefore spend more preparation time on positions where Kramnik is weak then he otherwise would have. Knowing this, Kramnik might....
By now you get the idea. There doesn't seem to be any clear dominant strategy here. Whether Anand should focus his preparations on positions where Kramnik is strong depends on what Kramnik is going to do, and vice versa.
The optimal strategy, most likely, is what game theorists call a mixed strategy. Anand should construct an equation under which he will focus on openings where Kramnik is strong with X% probability and not do so with probability 1-X%. The value of X would be determined by the relative payoffs of the various possible scenarios that could arise depending on what Kramnik does with his preparations. Perhaps that's what Anand really is doing, and this is what he means when he says that "I must remember that he is thinking about what I am thinking about him." Obviously, calculating the right value of X might not be an easy task.
Man in Black: All right. Where is the poison? The battle of wits has begun. It ends when you decide and we both drink, and find out who is right... and who is dead.
Vizzini: But it's so simple. All I have to do is divine from what I know of you: are you the sort of man who would put the poison into his own goblet or his enemy's? Now, a clever man would put the poison into his own goblet, because he would know that only a great fool would reach for what he was given. I am not a great fool, so I can clearly not choose the wine in front of you. But you must have known I was not a great fool, you would have counted on it, so I can clearly not choose the wine in front of me.
Man in Black: You've made your decision then?
Vizzini: Not remotely. Because iocane comes from Australia, as everyone knows, and Australia is entirely peopled with criminals, and criminals are used to having people not trust them, as you are not trusted by me, so I can clearly not choose the wine in front of you.
Man in Black: Truly, you have a dizzying intellect.
Vizzini: Wait till I get going! Now, where was I?
Man in Black: Australia.
Vizzini: Yes, Australia. And you must have suspected I would have known the powder's origin, so I can clearly not choose the wine in front of me.
Man in Black: You're just stalling now.
Vizzini: You'd like to think that, wouldn't you? You've beaten my giant, which means you're exceptionally strong, so you could've put the poison in your own goblet, trusting on your strength to save you, so I can clearly not choose the wine in front of you. But, you've also bested my Spaniard, which means you must have studied, and in studying you must have learned that man is mortal, so you would have put the poison as far from yourself as possible, so I can clearly not choose the wine in front of me.
Man in Black: You're trying to trick me into giving away something. It won't work.
Vizzini: IT HAS WORKED! YOU'VE GIVEN EVERYTHING AWAY! I KNOW WHERE THE POISON IS!
Narrative and Counter-Narrative on the Current Financial Troubles:
There's an interesting difference between the financial troubles of today and the Savings and Loan debacle of the late 1980s. In the latter case, the MSM (except for the WSJ editorial page, natch), quickly decided to blame deregulation and not, in any substantial way, the "moral hazard" of federal deposit insurance, which was a prerequisite to the crisis. Given the monopoly power the MSM had in those days, the "deregulation is solely to blame" theory quickly took hold, and helped lead to a backlash against Reagan-era deregulation.
Today there are certainly plenty of voices, within and without the MSM, who want to solely blame "deregulation," or at least "lack of regulation," for the debacle. But given blogs, YouTube, talk radio, and other non-MSM means of communication, a counter-narrative has formed, blaming the situation on government--the Community Reinvestment Act, Fannie and Freddie, Federal Reserve pump-priming, and so on.
Many of those who are pushing the latter theories, especially when primarily blaming the GSEs and the CRA, are being as simplistic as those blaming "deregulation." For example, say what you will about the GSEs and the CRA, my first encounter with the housing bubble was when I lost a house I bid on (by $1,000) to a woman who showed no objective evidence of being able to responsibly manage her money, or to afford the house in question. She apparently had saved virtually no money for a deposit ($1,000), put no money down on her mortgage because she had none, received all her closing costs built into the loan, and received a loan for $580,000, co-signed by her father as a second occupant, with whom she had rather tense relations (all told to us later by the seller, who was her friend) and did not currently live with. The loan was too big for Fannie and Freddie, and I'm pretty sure that no one was holding a CRA gun to the lender's head. I thought at the time, "who in their right mind would lend this person all this money, with negative collateral (a loan for more than the sale price)"?
In any event, I think there is plenty of blame to go around, and both the government (and especially the Fed) and short-sighted market actors (who believed that housing prices couldn't decline nationwide, because they handn't since the '30s--I think they had Greenspan himself as an authority for that one) come out looking pretty badly.
But I think it's interesting that while markets and deregulation shouldered almost all the blame in the 1980s, the government is going to get at least some of its share of the blame this time, thanks to the "new media."
The OT 2008 Supreme Court term already had the potential to be quite significant for environmental law with four environmental cases docketed. Then today the Supreme Court added another pair of cases, Burlington Northern and Santa Fe Railway Company, et al. v. United States and Shell Oil Company v. United States, concerning the application of joint and several liability for hazardous waste cleanups under the federal Superfund statute. In particular, the two cases (which are consolidated) concern when liability can be apportioned and when to impose arranger liability, and are potentially quite significant.
These grants come on top of several other environmental cases. Most notably, in Winter v. NRDC, the Court will hear the Bush Administration.'s challenge to a lower court injunction barring the Navy's use of sonar during certain training exercises for failure to conduct an environmental impact statement despite the Council on Environmental Quality's determination that "emergency" circumstances justified the failure to conduct an EIS. In another big case, Entergy v. EPA, the Court will consider whether the EPA may consider cost-benefit analysis when imposing regulatory controls on cooling water intake structures under the Clean Water Act. Other environmental cases up this term include Summers v. Earth Island Institute (standing and ripeness to challenge Forest Service regulations) and Coeur Alaska, Inc. v. Southeast Alaska Conservation Council/Alaska v. Southeast Alaska Conservation Council (application of Clean Water Act permitting requirements to deposit of fil material permitted under Section 404).
While none of these cases may be Massachusetts v. EPA-style blockbuster, taken together they could make this term quite significant for environmental law
All of our political leaders believe that the bailout plan is proper, but they were unable to persuade the public, and it was because of public pressure that Congress voted down the plan. Could the leadership have done a better job?
This story attributes their failure to an inadequate effort to scare people:
why, despite all the efforts of all of the country's leaders to fill them with fear of an economic apocalypse, did Americans not see a failure to act as a serious threat to their livelihoods?
Traditionally, human beings are not great at assessing this kind of risk — a peril that has not yet arrived and that is, in any case, hard to viscerally imagine. Witness people's reluctance to evacuate before hurricanes, and weather forecasts portend a danger far easier to comprehend than failing investment banks.
But there are methods of communicating risk in a way that stills the heart, with words that inject dread into the populace. And Treasury Secretary Henry Paulson Jr., Fed Chairman Ben Bernanke and President George W. Bush used none of them.
As the author later acknowledges, however, politicians are in a bind. If they fail to stoke fears, then the public will not support a needed bailout package. If they do stoke fears, however, the public might respond by selling off assets and withdrawing deposits, thus exacerbating the crisis and destroying the economy. There is yet a third problem. Even if leaders do stoke fears “optimally” so as to ensure passage of the bailout bill without causing further financial and economic turmoil, they will be blamed after the fact for fear-mongering. After all, if the bailout plan is a success, the financial system will not collapse, and everyone will say, hey, you said there was a problem and in fact all we ended up doing was lining the pockets of investment bankers! Among critics of the bailout plan, one already hears the claim that the Bush administration is just looking for another way of expanding executive power, and is using the present crisis as a pretext for doing so.
All of this might sound familiar. The events of 9/11 made people fearful in a way that so far the financial crisis of 2008 has not. (I should say, with respect to the general public; experts seem plenty scared.) But as the years passed, the level of fear declined, and the Bush administration had more and more difficulty persuading people to accept limitations on civil liberties for the sake of security. It was in the same bind then as it and Congress are today. To motivate people, it needed to scare them by describing worst-case scenarios; but it did not want everyone to hunker down in their basements and stop flying on airplanes and crossing bridges. At the same time, everyone accused the Bush administration of deliberately stoking fears in order to justify an expansion of executive power. As years pass without a second attack on American soil, this belief has entered conventional wisdom.
The problem in both cases is that there is no independent way to verify the facts, at least not as a practical matter when the decision whether to hand over more power to the government is being made. It is also in the nature of the crisis in both instances that it is impossible to state a precise estimate of the probability of future harm. I suspect that the only practical way for the public to evaluate the government’s actions is in a very broad-gauged way, long after the event, when one can decide whether things in general are going well or poorly—we are safe, our financial system functions, and the government is not using its new powers in an improper way. I can see how this might work in a parliamentary system with strong party discipline—just vote for or against the party that has been in power when the decisions were made. In our separation-of-powers system, it is harder to reward or punish the relevant decisionmakers; however, bipartisan consensus across branches, that a crisis exists and can be appropriately addressed in a particular way, may be an adequate substitute when in fact the government is divided by party.
Court Adds Ten More Cases to the OT08 Docket:
The Supreme Court held its "long conference" on Monday, and it has agreed to take 10 new cases (seven of them criminal cases). You can see the list and a quick description here. Before today, the forthcoming Term was notable for having lots of pretty minor cases. Based on a quick skim, the new cases look like more of the same. None of the granted cases look particularly earth-shattering, at least so far: A bunch look like pretty easy reversals.
Supreme Court Modifies Kennedy v. Lousiana:
The Court's amendments are here, together with a statement respecting the denial of reconsideration. The modified opinion is here. Only two Justices voted for rehearing, Alito and Thomas. Justice Scalia's opinion concerning the denial of rehearing (joined by Chief Justice Roberts) is here, and includes the following:
I am voting against the petition for rehearing because the views of the American people on the death penalty for child rape were, to tell the truth, irrelevant to the majority’s decision in this case.The majority opinion, after an unpersuasive attempt to show that a consensus against the penalty existed, in the end came down to this: “[T]he Constitution contemplates that in the end our own judgment will be brought to bear on the question of the acceptability of the death penalty under the Eighth Amendment.” Ante, at ___ (slip op., at 24). Of course the Constitution contemplates no such thing; the proposed Eighth Amendment would have been laughed to scorn if it had read “no criminal penalty shall be imposed which the Supreme Court deems unacceptable.” But that is what the majority opinion said, and there is no reason to believe that absence of a national consensus would provoke second thoughts.
This is pretty much what I thought would happen: Certainly no surprises here. Thanks to Corey Yung for the links: Corey has additional commentary here.
It's from several years ago, but the story about it (Verdicts & Settlements, Mass. Lawyers Weekly, Sept. 22, 2003) just got loaded onto Nexis.
A high school senior -- a former "High School Student of the Month" -- "took a photo of [the superintendent of schools] from the public domain and altered it to depict her with the flag of the former Soviet Union, a Nazi armband, a picture of Vladimir Lenin, and in the company of Osama Bin Laden and the devil. He posted the photo on [a publicly accessible] website with comments critical of her, signing his own name."
He was then approached at school by the police, and read his Miranda rights; the police then went to his house and seized his computer. "The town contended that this was not speech protected by the First Amendment and the police sought a criminal complaint for harassment," though the charge was later withdrawn.
"One of the officers reportedly said that there wouldn't have been an issue with the photo if it hadn't included a Nazi armband, which offended the superintendent because she was Jewish. The plaintiff stated that he did not know that she was Jewish, nor was his intent to mock her in any way because of her religion.... The police chief circulated a letter to religious leaders informing them that the police had been able 'to track down and charge the student responsible for this anti-Semitic act.' The School Committee held a locally televised meeting, and a member read a statement that characterized the photo as 'racist,' and without naming them, suggested that the plaintiff's parents had failed as role models."
The student had attempted to apologize throughout, but he was nonetheless suspended for five days. The student sued, and a state court judge "issued an injunction staying the suspension." The case eventually settled for $35,000 (presumably the full settlement, rather than $35,000 plus attorney's fees). The suspension was ultimately removed from the student's record, and the School Committee ultimately publicly acknowledged "that the student's conduct was not criminal nor intended to be anti-Semitic, and was protected by the Constitution."
Where did the $700 billion figure come from, a figure that Paulson insisted on when members of Congress suggested that perhaps they could authorize some of the money right away, and then provide more later?
"It's not based on any particular data point," a Treasury spokeswoman told Forbes.com Tuesday. "We just wanted to choose a really large number."
Well, let me just make a closing point. You know, my father came from Kenya. That's where I get my name.
And in the '60s, he wrote letter after letter to come to college here in the United States because the notion was that there was no other country on Earth where you could make it if you tried. The ideals and the values of the United States inspired the entire world.
I don't think any of us can say that our standing in the world now, the way children around the world look at the United States, is the same....
Taranto points out that the senior Obama's attempts to come to the U.S. must have happened in the late 1950s (since he actually arrived in 1959), and that Sen. Obama is suggesting that the standing in the world is lower now than back then. But can that really be right? As James Taranto points out, "In 2008, Obama fils has an excellent chance of becoming the next president. In 1959, there were large portions of the country where Obama père would have been treated as a second-class citizen." If our standing in the world — especially in places like Kenya — is lower now than it was in 1959 (a pretty big "if") I'd say that says more about the world than it says about us.
We're thinking of switching fonts, and we'd like your input. Here are some options:
If you have a paper that you'd like to enter in a legal writing competition, check out Prof. Kathryn Sampson's new Legal Writing Competitions blog (and its archives). Some of the prizes are $5000.
If you have a paper that you'd like to enter in a legal writing competition, check out Prof. Kathryn Sampson's new Legal Writing Competitions blog (and its archives). Some of the prizes are $5000.
If you have a paper that you'd like to enter in a legal writing competition, check out Prof. Kathryn Sampson's new Legal Writing Competitions blog (and its archives). Some of the prizes are $5000.
If you have a paper that you'd like to enter in a legal writing competition, check out Prof. Kathryn Sampson's new Legal Writing Competitions blog (and its archives). Some of the prizes are $5000.
If you have a paper that you'd like to enter in a legal writing competition, check out Prof. Kathryn Sampson's new Legal Writing Competitions blog (and its archives). Some of the prizes are $5000.
If you have a paper that you'd like to enter in a legal writing competition, check out Prof. Kathryn Sampson's new Legal Writing
Competitions blog (and its archives). Some of the prizes are $5000.
If you have a paper that you'd like to enter in a legal writing competition, check out Prof. Kathryn Sampson's new Legal Writing Competitions blog (and its archives). Some of the prizes are $5000.
Naturally, we'll set up some backup fonts in case some people don't have the one we choose, but my sense is that most of these should be pretty broadly available. Thanks very much for participating -- we'd like to get as many people to respond as possible!
Russian Government Airs "Documentary" Promoting 9/11 Denialism:
Cathy Young has an interesting post describing a recent "documentary" aired on Russian state television promoting claims that the US government itself orchestrated the 9/11 attack against the World Trade Center. Obviously, under Vladimir Putin's authoritarian rule, state television would not air such a program if it didn't suit the government's purposes for them to do so. That the Russian government now seeks to promote such extreme anti-Americanism among its people is disturbing to say the least.
At the same time, a measure of perspective is in order. A recent World Public Opinion survey shows that 57% of Russians know that Al Qaeda perpetrated the 9/11 attacks, while 15% believe that it was the US government and 2% cite Israel (a lower figure than I would have expected in light of Russia's history of anti-Semitism). These numbers are similar to results from Western European nations such as France (63% blaming Al Qaeda, 8% the US), Germany (64% and 23%), Italy (56% and 15%), and Britain (57% and 5%). Thus, 9/11 denialism is not (yet) significantly more common in Russia than in Western Europe. For my earlier analysis of this survey and its implications, see here.
If I had to guess, I would say that the Russian government's decision to air the denialist film has more to do with shoring up public support for the regime by directing public ire at an external enemy than with an active desire to provoke a confrontation with the US. With oil prices falling, the Russian economy is likely to suffer and the regime's grip on power become less firm. Putin and his henchmen may believe they need to ramp up their propaganda efforts by appealing to Russian nationalism even more than before. It is notable that, in a segment appearing right after the film, at the end of the movie, state network commentators claimed Russia was the world's only hope to resist America's "predatory" power, a message calculated to warm the hearts of Russian nationalists.
Unfortunately, history shows that such cynical stoking of the fires of extreme nationalism and anti-Americanism can easily get out of control. Most likely, Putin's objective in spreading this disinformation is merely to strengthen domestic support for his regime. But some of the millions of viewers will actually believe the claptrap on the show and possibly act on it when and if extreme nationalists get their hands on power in the future.
Watching this video has disturbed me more than almost anything I have seen in recent years. It is the kind of exploitation of children that reminds me of Young Pioneer Camps I saw when visiting the Soviet Union in the Eighties. You could say, as some have, that this is much like what happens with children in churches and synagogues across America, but this is about a political figure — one of two current presidential candidates and the one leading in the polls.
My first thought was that neither Obama nor his staff is responsible for this video, nor would Obama recommend such devotional singing. My second thought was that – as creepy and inappropriate as this singing is – it’s not as bad as what Obama is actually proposing: forcing all children, starting at the age of 11, to give 50 hours a year of child labor working in their communities at the direction of the federal government. When Obama himself crosses the line, it’s not surprising that some of his supporters do as well.
And no, though it should go without saying, I don’t think that some over-the-top behavior by Obama supporters is a significant reason to vote for or against either presidential candidate in November.
UPDATE: The video has available on Obama's official campaign website since August 20th on one of the community blogs, which means that it is not endorsed by the campaign staff itself. I suspect it will be pulled soon.
One commenter there wrote: "It's frightening to think of using single-digit-aged children to sing their allegiance to a human being running for political office. It's unspeakable to see it actually happen."
Ed Morrissey imbeds some of the more obvious comparisons. Certainly, one of them would be obvious to anyone who ever saw the movie Cabaret. He also notes that it appears Jeff Zucker, the head of NBC, was one of the many people behind the filming of the performance (using HDTV cameras). [Appearances are misleading; it's a different Jeff Zucker!; link previously corrected.]
As to the bailout plan, I was modestly in favor of it until I read Dodd's proposal, which turned me against his version of the bill. But by Monday, every particular provision that I objected to (including the relatively obscure ones) were removed from the bill. After that, I went back to being modestly in favor of it. But I still am not confident of my view on whether on balance it is a good thing or a bad thing.
The Competitive Enterprise Institute has set up a new website "Bailout Watch" to monitor developments. John Berlau asks whether the bailout will make matters worse:
But what if the bailout, as originally proposed and in its latest incarnation, would spend $700 billion of taxpayers' money and actually make the economy worse? Believe it or not, there is good evidence this may happen. The inflationary prospects of the bailout price tag may lead to spikes in oil and crop prices that could hit ordinary Americans in their cars and on their kitchen tables. And government purchases of financial assets could ironically further constrain credit through causing write-downs on even the balance sheets of financial firms not participating in the bailout by worsening the effects of mark-to-market accounting rules.
All last week, the stock market's plunging downward was pointed to as a sign that Washington must step up to the plate — as quickly as possible. Yet ironically last Friday — the day after the bailout talks broke down at the wild White House meeting with the presidential candidates — the Dow Jones industrial average actually went up by 120 points! This doesn't mean that the market is opposed to the bailout, but it does show that the market volatility is probably as much due to the potential effects of a bailout as it is to a lack of one.
Add to this the possible unintended consequences of the bailout for other industries (such as hedge funds, for example) and the difficulty of resisting future bailouts for other industries.
I'm not sure that Berlau's concerns fully offset any potential benefits from a bailout, but they seem plausible as potential offsetting factors.
According to this report, Alan Blinder and Newt Gingrich have also called for Paulson's resignation.
Frank James asks (also excerpting from my post yesterday):
As the fingerpointing continues following the House's failure to pass the $700 billion bailout, a lot of blame is going to Treasury Secretary Henry Paulson Jr. for first trying to run roughshod over Congress and the sensibilities of taxpayers until he realized that approach was doomed to failure.
Paulson is being singled out for crafting an initial proposal that was so offensive to many Americans and members of Congress in how it sought vast new and unreviewable powers for the Treasury Secretary.
With the controversial three-page proposal he dropped on Congress last week, he wound up creating a wave of outrage so huge it couldn't be overcome by the time yesterday's vote occured.
The very same hard-charging qualities that led him to be such major success and riches on Wall Street as investment bank Goldman Sachs' chairman and chief executive, it's thought, caused him to be insensitive to how consensus is formed in Washington and how major legislation must be marketed to the American people.
Interviewed on CNBC this morning, Steve Forbes, chairman and CEO of Forbes Inc., said "Paulson, with House Republicans, has been about as effective as an angry drill sergeant talking to raw recruits."
There've been the inevitable calls for Paulson to resign. Last week Alan Blinder, a Princeton University economist who served as Federal Reserve vice chair in the 1990s called for his resignation. That was followed on Sunday by a similar call from former House Speaker Newt Gingrich.
All this raises the following question. Does Paulson have enough political capital remaining to renegotiate a revision of the already revised bailout? Many financial market commentators are saying the markets still believe there'll be a bailout package and are trading on that belief.
But Paulson may not have the sway to pull if off.
A friend of mine (who follows politics loosely) put it this way yesterday afternoon, "Looks like they stopped Paulson's bailout for his Wall Street buddies." I think that perception around Paulson is pretty widespread at this point and that it is time for someone else to take over, or at least to take over as the point man for the bailout. This is the point that I was alluding to yesterday. As for not "marketing" this to the American people, no offense but has an investment banker ever asked anyone for permission to do anything that they wanted to do? And is it really accurate to say that it was a failure of "marketing," as opposed to just a lack of confidence that this particular piece of legislation is necessary?
How about as a new Treasury Secretary someone like Peter Fitzgerald, former Senator from Illinois, founder and Chairman of Chain Bridge Bank a new community bank, and a member of a multi-generation banking family?
If a true "Main Street" (I hate that term, btw) banker like Peter Fitzgerald studied the bailout and said that he thinks that the blunderbuss bailout is the way to go for the good of the country, then I think that'd show me a lot.
It would also be nice for them to re-boot the entire process, perhaps starting with the House Republican proposals as a new baseline and move from there. Perhaps we will end up at the same point (Paulson says that they considered and rejected more modest approaches), but at least then we'd know that this was the last resort.
As of now, there has been no independent testimony, no vetting of alternative options, and they've kept all the relevant information close to the vest and said "trust me." Many smart economists have opposed it. Many smart economists have supported it--but only because they do trust Bush-Paulson's representation of a doomsday scenario. This is crazy to make such big policy decisions based on credibility rather than fact.
Co-conspirators Ilya Somin and Eric Posner are having an interesting debate (see chained posts) about what the market's near-collapse does, or doesn't, show about the perceived virtues of the bailout bill. It's an interesting epistemological question -- a question about how we know what we know about the world from the evidence presented.
On an ordinary day (and on pretty much every ordinary day) there's a headline in (pretty much) every newspaper that looks like: "Markets Close Lower on Intel Earnings Warning," or "Market Surges on Oil Price Drop," or "Inflation Fears Spur Stock Sell-Off," or the like. It's all pretty much total hooey -- the fact that we see it every day sometimes makes it look like it means something, but it doesn't. The stock market moves billions of shares every day -- over 4 billion yesterday -- as a result of millions of individual trades (over 17 million yesterday). Those are very big numbers. The market moves as a function of the aggregate of each of those decisions. The idea that a reporter, sitting at her desk making a few phone calls, can understand the "why" behind anything other than a vanishingly small proportion of those trades, is nuts.
Back to Ilya and Eric's argument. It seems to me that the following statements are indisputably correct:
1. If traders believed that the government was about to enact a bailout bill that amounted to a naked transfer of wealth from taxpayer to shareholders [Ilya's position, roughly], and had traded in anticipation of such a bill, the market would fall calamitously when the bill goes down to defeat.
2. If traders believed that the government was about to enact a bailout bill that would save the U.S. economy from descending rapidly into a credit crisis of vast proportions [Eric's position, roughly], and had traded in anticipation of such a bill, the market would fall calamitously when the bill goes down to defeat.
I don't see any way to distinguish between those two hypotheses without asking a (large) number of yesterday's traders what they had in their heads, and why they made the trades they made (and even that, of course, is deeply problematical, given the enormous difficulties of getting any reliable information from surveys of that kind).
Several years ago, Ohio Supreme Court races were fiercely contested. Industry, labor and various legal groups sponsored vicious advertisements attacking candidates for the court and justices seeking re-election. One reason for this was because the Ohio Supreme Court had become very active in contentious policy disputes, ranging from education to tort reform. The court held the state's system for education funding unconstitutional four times, repeatedly invalidated legislatively enacted tort reform measures, and endorsed expansive theories of tort liability. With so much at stake, it was inevitable that interest groups would seek to influence the outcome of judicial elections.
In the last few years, however, the Supreme Court has backed away from this aggressive posture, largely due to changes in court personnel. The court has abandoned its effort to force the legislature to rebuild the state school funding system from the ground up, and has upheld legislative education reforms against constitutional challenge. It has trimmed back its most expansive tort liability rulings and now rejects most constitutional challenges to legislatively enacted tort reforms, such as caps on non-economic and punitive damages.
This change in the Ohio Supreme Court is documented in a new white paper I co-authored with my lovely wife, Christina, for the Federalist Society, A More Modest Court: The Ohio Supreme Court's Newfound Judicial Restraint, released today. The paper seeks to show that across a wide-range of issues, the Court has become more deferential to the legislature and less likely to impose its policy preferences on the state.
My own view is that this change in the Court's approach has greatly lessened the stakes in Ohio Supreme Court elections. Two justices are up for re-election this year, but we are not seeing the flood of outside advertisements that aired in prior election years. As the court has become more modest, judicial races have become less contentious.
While the Court is not the hot-button political issue it was in the past, the outcome of these judicial elections will affect the future course of the Court, and it is possible the Ohio Supreme Court could return to its old ways. While the Court is nominally all Republican (judicial candidates run in partisan primaries), it is divided 4-3 and 5-2 on many key issues, including the constitutionality of legislative limits on tort remedies, local home rule, and the application of Ohio election laws. As a consequence, this year's Ohio Supreme Court races are worth watching.
Attorney General Michael Mukasey appointed a special prosecutor to examine potential misconduct by White House and Justice Department officials related to the firing of several U.S. Attorneys. From the Legal Times:
Mukasey announced the appointment of career prosecutor Nora Dannehy to investigate the firings as the report was released Monday. Dannehy, currently the acting U.S. Attorney for the District of Connecticut and a veteran of the office's white-collar and public-corruption section, will be able to subpoena witnesses to help her investigation, something the authors of the report couldn't do.
The report specifically recommends that Dannehy investigate whether Justice Department officials made false statements to Congress or to investigators or violated other federal criminal statutes, including obstruction of justice or wire fraud.
From my initial read skim of the report, it seems that the most likely prosecutable offenses would be allegedly false statements to Congress and investigators, rather than the firing of U.S. Attorneys.
The article also quotes attorneys for Alberto Gonzales and Kyle Sampson disputing the investigative report that prompted the prosecutor's appointment.
, Gonzales' lawyer, George Terwilliger III, a partner at White & Case, said the report "makes clear that Judge Gonzales engaged in no wrongful or improper conduct while recognizing, as he has acknowledged many times, that the process for evaluating U.S. attorney performance in this instance was flawed." . . .
Sampson's lawyer, Bradford Berenson, a partner at Sidley Austin, said: "It is mystifying and disappointing that the Inspector General chose to impugn Mr. Sampson's candor and integrity when, virtually alone among significant participants in this matter, Mr. Sampson at all times cooperated fully and voluntarily with any and all investigators, without preconditions, and provided his best, most honest and complete recollection of these events. He has behaved with honor and dignity throughout this difficult episode and has never attempted to shirk his responsibility for problems in the U.S. Attorney firings."
The Times says today that because of the failure of the Bailout Bill, Treasury and the Fed will have to dig deeper into their toolkits, which really means just lending more and more money to distressed firms.
“We have a lot of money to play with,” said Kenneth Rogoff, an international economist at Harvard. “As long as foreigners have a lot of confidence in our ability to solve our problems, we can borrow the $1 trillion to $2 trillion [!] we need to solve it.”
Wait, don’t they need a statute from Congress? Apparently not: they just borrow more and more money from whoever is willing to provide it, namely, foreigners. Which makes one wonder what exactly the Bailout Bill was supposed to accomplish. It may be that technically, Treasury and the Fed cannot purchase mortgage-related assets (actually, I think the Fed can); but they can, as we saw in the case of AIG, lend money to firms and take security interests in their assets, including mortgage-related assets, and then take over those firms when they default, as many of them will. Perhaps, existing statutory authorities to lend to distressed firms don’t give them as much flexibility as the plan gave them (maybe the difference is that everything has to take place through the Fed, rather than through Treasury, but they appear to cooperate closely with each other anyway), but they also needn’t worry about oversight, limiting executive compensation, and the rest of the constraints that the Bill contained.
The Times article suggests that the main risk from this arrangement is that foreign lenders will stop lending to Treasury because they fear that our government will never pay them back. I suppose that this is the true significance of the failure of the Bailout Bill. If Congress won’t support the lending program ex ante by enacting that bill, then foreign lenders might infer that Congress won’t support the lending program ex post by raising taxes to pay off government debt, and the entire house of cards collapses. However, I suspect that the United States remains a pretty good credit risk. If I am right, then the failure of the bill means that the resolution of the crisis will be more costly and cumbersome than it would otherwise be, and will take place with less oversight, but not that the government will sit around and wait for the “correction” to take place. If I am wrong, then we are headed for dark times. The libertarian option is simply not on the table.
More from David Zaring, with links to others on this topic.
Courts Allow Same-Day Registration, Voting in Ohio:
Both state and federal courts turned away GOP lawsuits challenging Ohio Secretary of State Jennifer Brunner's decision to allow same-day voter registration and early voting. The Ohio Supreme Court upheld Brunner's decision 4-3, and two federal courts declined to rule the other way. The NYTreports:
The early voting begins Tuesday and runs through Oct. 6. The Ohio Supreme Court and a federal judge in Cleveland on Monday upheld the weeklong voting period. Later in the day, Judge George Smith of Federal District Court in Columbus declined to rule, deferring to the Ohio Supreme Court decision.
But Judge Smith ruled that counties must allow party poll observers during early voting.
The disputed voting window results from an overlap between Tuesday’s beginning of absentee voting 35 days before Election Day, and the Oct. 6 end of voter registration.
Does the Stock Market Fall Prove that the Bailout Would have Been Worth it? - Round II:
Co-blogger Eric Posner argues that today's decline in the stock market proves that the bailout would have been worth the cost:
Ilya and Casey [Mulligan] say that the bailout was just a transfer of wealth from taxpayers to shareholders. Maybe. But most taxpayers are shareholders, and the return seems pretty good. Even if we confine ourselves to the U.S. stock market, a return of $800 billion on an investment of $700 billion (actually, a lot less, given that money is used to purchase assets that will eventually be sold again even if at a loss) is not bad. If we count the world’s $2.5 trillion, the return is quite excellent. (I realize this is not a controlled experiment, but we have to use whatever information is available. As Ilya hints, he can salvage his theory by arguing that the failure of the bill tells shareholders that subsequent bailout bills, spending even more money, are less likely than before.)
I continue to disagree, for several reasons.
First, as I noted in my original post, past stock market crashes show that the real economy isn't necessarily damaged as a result and can in fact rebound quickly if no harmful policies are adopted to prevent it. To use today's fall in stock values as an indicator of the costs and benefits of the bailout is similar to claiming that the similar 7% loss in stock value when markets first reopened after 9/11 was an accurate measure of the economic impact of that attack - while ignoring that the economy (and stocks) did well thereafter, soon recovering the loss. Sudden stock market shocks caused by uncertainty, disappointment (in this case, disappointment that stockholders won't get an expected bailout), and fear are not a good measure of longterm impact on an economy.
Second, as Eric suggests, I do indeed worry that the bailout would have caused other bailouts and government interventions that would put us on a path to significantly lower growth in the future. That really would damage the overall economy in a way that a sudden drop in stock prices doesn't.
Finally, much of the fall in stock prices may be due to the market devaluing assets (e.g. - bad mortgages) that had been overvalued previously. The bailout might have prevented or reduced such reconsideration because it would have artificially propped up the value of these overpriced assets by buying many of them up with taxpayer funds. More accurate pricing of assets is good for long-run economic growth and is likely to enhance our wealth, not reduce it. By pricing these bad assets more accurately, the market can facilitate the transfer of capital to other, better uses, making us richer in the long run.
UPDATE: I also respectfully disagree with Eric's claim that "Nearly every knowledgeable person supported the bill – in the sense of believing that the bill was better than nothing, even if he or she believed that some variation would be even better than the actual bill." A recent petition signed by over 190 prominent economists from across the political spectrum stated that the bailout plan "is a subsidy to investors at taxpayers’ expense. Investors who took risks to earn profits must also bear the losses. Not every business failure carries systemic risk. The government can ensure a well-functioning financial industry, able to make new loans to creditworthy borrowers, without bailing out particular investors and institutions whose choices proved unwise." They also contend that "If the plan is enacted, its effects will be with us for a generation. For all their recent troubles, Americas dynamic and innovative private capital markets have brought the nation unparalleled prosperity. Fundamentally weakening those markets in order to calm short-run disruptions is desperately short-sighted." It sure looks to me like this large group of highly knowledgeable people don't believe that "the bill was better than nothing."
UPDATE #2: Co-blogger David Bernstein points out in an e-mail that the stock market often reacts favorably in the short term to any drastic action to control a perceived crisis. For instance, the Dow Jones saw a then-record one day increase when Richard Nixon imposed wage and price controls in August 1971. That euphoria faded as the true impact of this flawed policy became more clear over time. Today, few if any economists believe that Nixon's decision was a good one (many were highly critical at the time, too). Indeed, his policy is considered a grave error by most experts.
UPDATE #3: Jonah Gelbach at Prawfsblawg responds to this post, but mischaracterizes my argument. He claims that my position is based on the argument that "the stock market lost more in the crash of 1987" and "A recent petition signed by over 120 prominent economists from across the political spectrum" [expressing opposition to the bailout plan]. These points are not, of course, my main argument, which is that today's stock market crash does not prove that the bailout was a good idea because stock market conditions - especially short term swings - often don't reflect the underlying condition of the real economy. In this and the previous post, I give several reasons why that is true. The stock market crash of 1987 is just one historical example backing up the main point. Gelbach says nothing that disproves my more general arguments.
Thus, it is a reasonable bet that most if not all of the signatories oppose the amended bailout plan as well, or at least that enough of them do to undercut Eric's claim that "nearly every knowledgeable person" supports it as "better than nothing." Gelbach deserves credit for correcting the error about the petition. But the rest of his post isn't responsive to the real arguments that I raised in mine.
UPDATE #4: Gelbach has modified his post to emphasize that his point is that "serious people in the blogosphere are focusing on the wrong topic (the stock market)," which he believes is "remarkably wrongheaded." If a focus on the "stock market" is indeed "remarkably wrongheaded," it seems to me that any resulting blame attaches primarily to those raised the stock market decline as a defense of the bailout - not to those who sought to rebut that claim.
Let’s see, if markets around the world are capitalized at about $50 trillion and they declined, say, 5 percent on average as a result of Congress’s vote, then about $2.5 trillion of wealth vanished (okay, maybe a bit lower, according to Jim's account of Asian markets; the rest of the world looks less good). For the United States alone, the loss is about $800 billion. Even by Congress’s standards, this is impressive. Further thoughts –
1. Perhaps, the market’s response to the failure of the bill came as a surprise to some. Now that it’s clear what’s at stake, the world should be willing to pay up to $2.5 trillion to get Congress to change its mind. Surely this is enough? Intrade says no; I’d bet against it but I prefer to keep my money under my mattress, thank you. Anyway, the Chicagoan in me says that the market decline already reflects the probability that a subsequent bill will also fail or will come too late.
2. Ilya and Casey say that the bailout was just a transfer of wealth from taxpayers to shareholders. Maybe. But most taxpayers are shareholders, and the return seems pretty good. Even if we confine ourselves to the U.S. stock market, a return of $800 billion on an investment of $700 billion (actually, a lot less, given that money is used to purchase assets that will eventually be sold again even if at a loss) is not bad. If we count the world’s $2.5 trillion, the return is quite excellent. (I realize this is not a controlled experiment, but we have to use whatever information is available. As Ilya hints, he can salvage his theory by arguing that the failure of the bill tells shareholders that subsequent bailout bills, spending even more money, are less likely than before.)
3. Intrade says that Obama and the Democrats have benefited. That sounds right to me. The bill is identified with the Democrats, who crossed party lines to make a deal with the Republican administration. Nearly every knowledgeable person supported the bill – in the sense of believing that the bill was better than nothing, even if he or she believed that some variation would be even better than the actual bill. Republicans are seen as obstructionist, perhaps influenced by libertarian arguments they read on VC (just kidding).
No, the real reason for the no votes is that constituents of at-risk members of Congress don’t want to bail out Wall Street. Do these constituents have any insight into the risk that the current financial crisis will cause significant harm to the economy? I doubt it. Perhaps, these words should be carved into the entablature of the Capitol:
"We're all worried about losing our jobs," Rep. Paul Ryan, R-Wis., said, endorsing the bill and voting for it after leading a rebellion against an earlier version last week. "Most of us say, 'I want this thing to pass, but I want you to vote for it, not me,'" he said, speaking for colleagues who have tougher re-election fights than his own.
4. Can the administration be faulted for failing to make an adequate case for the urgency of the situation? Just how is it supposed to do that without being accused of exploiting people’s irrational fears in order to expand executive power?
5. If Congress is paralyzed, what can the executive do on its own? Where is that constitutional dictator when you need him?
We Just Hit One Million "Unique Visitors" in September,
according to eXTReMe Tracking. Our previous record was 758,814 in April of this year -- and while this month was unusually high, (1) every month this year had a higher unique visitor count than any of the months from last year, and (2) the average for January to August 2008 is over 25% above the average for January to August 2007.
So thanks to all of you for coming, and please stick around!
Second Circuit Considering Crime-Facilitating Speech Case:
I meant to blog this last month, when the oral argument took place, but it slipped through the cracks. Still, I thought I'd mention it, since it's such an interesting issue. From law.com (via How Appealing):
Second Circuit Judges Jon Newman, Guido [Calabresi] and Sonia Sotomayor expressed concern during oral arguments Wednesday that the statutory language of a key provision of the USA Patriot Act might be overly broad, potentially applying in instances where national security is not truly at stake.
The 2001 statute authorized the Federal Bureau of Investigation to issue National Security Letters (NSLs) to telecommunications carriers like phone companies and Internet service providers, compelling their cooperation in government investigations relating to counterterrorism and other national security efforts.
NSLs also carry a gag order prohibiting any recipient from disclosing that fact....
This is one of the issues I discussed in my Crime-Facilitating Speech, 57 Stan. L. Rev. 1095 (2005). Publicizing the existence of this sort of government surveillance can seriously interfere with the investigation, for instance by informing criminals and terrorists that they're under suspicion and that certain phones, bank accounts, or tactics are no longer safe to use.
But such publicity can also substantially inform public debate about government action and possible government abuse. Concrete and timely examples of alleged abuse — whether or not the alleged abuse rises to the level of illegality or unconstitutionality — may be necessary to persuade the public or opinion leaders to press for changes in government policies: A general complaint that some unspecified abuse is happening somewhere will naturally leave most listeners skeptical. And even if the revelation of the surveillance is only delayed for some months or years, rather than being prohibited forever, such a delay may make it much harder to get timely political action, especially since people tend to be much less interested in alleged abuses years ago than in alleged abuses that are happening right now.
So should the speech be protected because it's valuable to public debate, despite the potential harm to law enforcement or even national security? Or should law enforcement and national security prevail despite the potential harm to informed public debate on the merits of the surveillance tactics? That's the tough question that the Crime-Facilitating Speech article tries to deal with, as to this question and as to others, and that the Second Circuit will likely have to deal with as well (though it's possible that the Second Circuit might deal with it simply by saying that this particular statute is too broad, and without deciding how narrow the statute has to be in order to be constitutional).
NYU Psychology Department Research Project on Elections:
Seems interesting, so I thought I'd pass along a pointer to its questionnaire, in case some of you folks would like to participate. Here's a brief summary of what they're doing:
A research team from the Psychology Department at New York University, headed by Professor Yaacov Trope and supported by the National Science Foundation, is investigating the cognitive causes of voting behavior, political preferences, and candidate evaluations throughout the course of the 2008 U.S. Presidential election. This stage of the study focuses on the information people use to inform evaluations during the last few weeks before the election. They seek respondents of all political leanings from all over the country (and from the rest of the world) to complete a 15-minute questionnaire, the responses to which will be completely anonymous.
[NOTE: When the researchers first asked me to post this, they asked that I block comments, so that readers' comments avoid influencing the responses other readers give. I unfortunately forgot to do that, so the post originally came up with comments; I've since deleted them, and blocked them -- my apologies to the researchers, and to the users whose comments were deleted.]
Our traffic has been quite good, but we always want more. And since we get a modest income from our advertising, we were wondering whether it might be good to put some of that into advertising our blog. The trouble is that we have no idea whether and under what circumstances such blog advertising works (at least when the product being advertised is itself a blog).
If any of you have personal experiences -- positive or negative -- with such advertising, or have other data on the subject, we'd love to hear from you. Please feel free to either post in the comments, or e-mail me at volokh at law.ucla.edu. Thanks!
Can you think of any ways that the site could be improved, or do you like it pretty much as it is? For instance, do you think it would be better with a different font, wider margins, a different format for the posts, or something else? Or is it best to stick with things as they are? Let us know, please.
Why the Stock Market Drop Doesn't Prove that Congress was Wrong to Reject the Bailout:
The stock market's record 778 point drop today will no doubt lead many people to conclude that the House of Representatives was wrong to vote down the bailout plan backed by both the Bush Administration and the Democratic leadership. Indeed, Senate Majority Leader Harry Reid has already made that argument. Here's why I think such claims are wrong.
What is good for stockholders isn't necessarily good for the economy as a whole. Normally, I'm not much moved by populist rhetoric about how the interests of "Main Street" are at odds with those of "Wall Street." This, however, is one of the rare cases where such cliches have a measure of truth. If Congress were planning to pass a bill providing, say, a $100 per share subsidy to stockholders at the expense of taxpayers, no doubt stock values would rise in anticipation and then fall precipitously if the plan were unexpectedly voted down. That is essentially what happened here. Many stockholders owned shares in firms that expected to be bailed out. In addition to the financial firms that would have been the immediate beneficiaries of the bailout, shareholders in many other industries could foresee a "slippery slope" under which their firms could expect an increased chance of a bailout for themselves. At least for the moment, this slippery slope has been forestalled. Naturally, shareholders are disappointed, and their stocks are falling in value. But the outcome is good for the larger economy because we will not have a massive orgy of wealth transfers from successful industries to failing ones, nor will we create a serious moral hazard by signalling that firms that make overly risky investments that fail can expect to be bailed out in the future.
Even in the Great Depression, most economic historians agree the harm caused by the stock market crash of 1929 was not by itself enough to cause a severe economic downturn. Rather, the Depression got as deep and prolonged as it did because of a wide range of failed government policies, including a massive currency deflation, the Smoot-Hawley Tariff of 1930, and gargantuan boondoggles such as the National Recovery Act.
UPDATE: University of Chicago economist Casey Mulligan provides a helpful summary of the reasons why the performance of Wall Street generally and finance firms in particular isn't a good predictor of the condition of the economy as a whole.
And speaking of leadership, why didn't John McCain set up a meeting with House Republicans, announce he was firmly endorsing the "bailout" bill, and tell them it was crucial to his campaign and the future of the country for the bill to get passed. For that matter, why didn't Obama do the same with the House Democrats? They are, in practice, the leaders of their parties, after all.
One can only conclude that either our "leaders" don't think that this crisis is all it's made out to be, or they are pathetic.
Today's 8.8% decline in the SP 500 was the second worst day since at least 1950. Only the October 19, 1987 crash was worse (-20.5%).
Since 1950, there have been 9 days with at least a 5.5% drop in the SP 500.
On average, the day following a 5.5% DOWN day was UP 3.5%, the 2d day later was UP another 1.6%, and the third day was DOWN 0.4%. In the seven -5.5% days since September 1987, the pattern for the first three days after the drop was similar, though the 4th day after was UP 0.8% and the 5th day after was UP 0.5%.
As worrying as a huge DOWN day is, two days after a 5.5% DOWN day the SP 500 is on average 5.1% higher.
So why doesn't this analysis persuade me to go substantially long on Tuesday?: because emotionally I feel that this time it will be different. As it is, I moved back into the market at Monday's close just a fraction of what I took out of the market late last week.
Hank Paulson knows a lot about Wall Street. But he also knows a lot of the guys on Wall Street. And I fear that is the problem. From the beginning this whole bailout smelled more like welfare for his Wall Street billionaire cronies rather than for the good of the country. Not a single Wall Street guy has come forward and offered to do anything to make the bailout work but instead the attitude that has emanated from those quarters has been one of entitlement and arrogance.
While his experience is obviously valuable, I believe that Paulson's close relationship with Wall Street has provided a skepticism about the bailout. His opening offer to Congress was so arrogant and so lopsided in favor of Wall Street and his own powers, that it basically smacked of bad faith. Perhaps he was acting in good faith--but I think that Congress and the American people were skeptical. I sure as heck know I was. He did nothing to demonstrate that he was any different in character or integrity from the guys who got us into this and now want us to bail them out. We now know enough about the integrity of these guys to be skeptical about anything that they touch.
Hank Paulson is not an economist. He has not explained why he believed the blunderbuss bailout was the only option that would work. As the President of BB&T noted in his letter on the bailout, it appears that he knows nothing about commercial banking or exactly how or when the credit problems would trickle down to "Main Street."
Paulson should resign. If the same deal were negotiated with someone other than an old Wall Street crony, I think that many people would look on it differently. But as things stand, I think he is fatally flawed. If he really thinks that a bailout is what is best for the country, then he should resign. And let someone with greater independence from Wall Street come in and study the issue and see if this massive bailout plan is still necessary.
The full report from the Justice Department Office of Inspector General and Office of Professional Responsibility is no available. Here are some excerpts from the lengthy report's conclusions.
In sum, we believe that the process used to remove the nine U.S. Attorneys in 2006 was fundamentally flawed. While Presidential appointees can be removed for any reason or for no reason, as long as it is not an illegal or improper reason, Department officials publicly justified the removals as the result of an evaluation that sought to replace underperforming U.S. Attorneys. In fact, we determined that the process implemented largely by Kyle Sampson, Chief of Staff to the Attorney General, was unsystematic and arbitrary, with little oversight by the Attorney General, the Deputy Attorney General, or any other senior Department official. In choosing which U.S. Attorneys to remove, Sampson did not adequately consult with the Department officials most knowledgeable about their performance, or even examine formal evaluations of each U.S. Attorney’s Office, despite his representations to the contrary. . . .
We believe the primary responsibility for these serious failures rest with senior Department leaders – Attorney General Alberto Gonzales and Deputy Attorney General Paul McNulty – who abdicated their responsibility to adequately oversee the process and to ensure that the reasons for removal of each U.S. Attorney were supportable and not improper. These removals were not a minor personnel matter – they were an unprecedented removal of a group of high-level Department officials that was certain to raise concerns if not handled properly. Yet, neither the Attorney General nor the Deputy Attorney General provided adequate oversight or supervision of this process. We also concluded that Sampson bears significant responsibility for the flawed and arbitrary removal process. Moreover, they and other Department officials are responsible for failing to provide accurate and truthful statements about the removals and their role in the process.
We believe our investigation was able to uncover most of the facts relating to the reasons for the removal of most of the U.S. Attorneys. However, as described in this report, there are gaps in our investigation because of the refusal of certain key witnesses to be interviewed by us, . . .
The Department’s removal of the U.S. Attorneys and the controversy it created severely damaged the credibility of the Department and raised doubts about the integrity of Department prosecutive decisions. We believe that this investigation, and final resolution of the issues raised in this report, can help restore confidence in the Department by fully describing the serious failures in the process used to remove the U.S. Attorneys and by providing lessons for the Department in how to avoid such failures in the future.
Speaker Pelosi's speech before the House today was remarkable, but not in a good way. She was trying to round up votes for a bailout package that shes claims to believe is essential for the stability of the American economy. She can't, and doesn't want to, pass the bill without a substantial number of Republican votes. So what does she do? You would think she would say, "let's pass this emergency measure now, in the best interests of the country, and talk about who is to blame later." Instead, Pelosi began her speech with a highly partisan tirade against "Bush" and "Republican" economic policies, which were allegedly to blame for this situation [UPDATE: Some commenters claim that she only attacked Bush, not Republicans more generally. They obviously didn't listen to the video at 2:24]. She focused on an attack on the growth of federal deficits, which clearly are at best tangential to the current crisis. That, to me, is the sort of irresponsible thing you do when (a) you're not claiming there is a vast emergency; and (b) you are in the minority, and not claiming to exercise leadership. [Commenters point out that Republican Housemember were acting equally irresponsibly to the extent they rose to Pelosi's bait and voted against the bailout out of pique at Pelosi. True. But the Speaker of the House is a leader, not just a random member of the House, and her actions inevitably and justifiably get more scrutiny than those of her colleagues.
UPDATE: As I wrote in the comments, I have no idea why any particular member, or group of members, of the House, voted for or against the bill. All I'm saying is that if you are trying to rally the House to pass an emergency bill, you make it seem like there is AN ACTUAL EMERGENCY, which more or less precludes partisan attacks. To the extent any Republican voted against the bill because of Pelosi's speech, it may not be a question of them being offended by her partisanship, but the perspective that if Pelosi thinks that the situation calls for partisanship, it must not be a serious emergency, because leaders simply don't engage in such antics when a true emergency is at hand. For that matter, if I were a Democrat skeptical of the bill, Pelosi's speech may have discouraged me from voting for it for the same reason.
FURTHER UPDATE: Here's a cynical take from commenter Bart:
Pelosi was not acting out of stupidity, but out of malice to obtain partisan electoral advantage.
The woman knows how to count votes. She has kept several bills from coming to votes over the past Congress because she knew she was short on votes and would lose.
The woman knows how to follow polls. Obama was losing to McCain until this mess emerged a little over a week ago. Now Obama has a 5 point lead.
One has to be willfully blind not to see that Pelosi was attempting to dump on Bush and pick a fight with the GOP to ensure that this rescue plan lost and the partisanly advantageous crisis continues.
Bailout Bill Is Losing in the House; Dow Down 500 points.
The Bailout Bill is being voted down, but the voting is being held open in the hope of changes. The Dow was down about 250 points before the vote, then dropped to 680 points down, but has rebounded to down about 500 points.
UPDATE (2pm ET): The NASDAQ is down a staggering 129 points.
2D UPDATE (2:15pm ET): The Bailout Bill has failed.
The Dow is down 4.8%.
SP 500: -6.6%
Brazilian market (BVSP): -10.1%
Chinese ADRs (BKCN): -10%
3D UPDATE: The expected volatility, as measured by the CBOE VIX index is at about 45. If it closed there, it would be the highest close ever recorded (or at least as far as I found data, going back to 1990). In other words, fear is at a higher level than in 1998 or post 9/11.
4th UPDATE (5pm ET): The Dow finished down 777 points. The SP 500 had its second worst day since 1950 (down 8.4%). Barney Frank was genuinely funny making fun of Republicans whose feelings might have been hurt by Nancy Pelosi's speech. He offered to go to each of the offended Republicans and speak uncharacteristically nicely to them.
A Thought About the Move to Pass-Fail Grading at Law Schools:
Harvard and Stanford are joining Yale in moving to a pass-fail system of grading. One cautionary note: When I was a first-year student at Yale, many of my classmates, myself included, applied for Summer jobs at big law firms. Unlike second-summer jobs, first-summer jobs were difficult to acquire.
Firms hired Yale first years in the Winter. Our first semester was pure pass/fail, with no "Honors." With no grades to go on, law firms seemed to use proxies. My classmates who went to the very top undergraduate colleges--Harvard, Yale, Amherst, Princeton--procured firm jobs. Those of us who went to less elite colleges--SUNY Binghamton, Brandeis, Berkeley, Trinity--did not. The elite-undergraduate school advantage dissipated as some students routinely received honors and others rarely if ever did, but differentiated among students will undoubtedly be far more difficult at Harvard with its 500-student classes. As a commenter at Leiter worries, "What will happen is that employers, judges, and fellowship committees will view undergraduate institutions as a proxy for success, which can make law school even more of a finishing school for the elite."
Fareed Zakaria (author of a truly fine book and columnist for the Washington Post) rightly argues that Sarah Palin is unqualified to be president of the United States (and, hence, by extension, unqualified to be V-P). Mr. Zakaria is correct that Gov. Palin's recent answer to a question about the economy "is nonsense - a vapid emptying out of every catchphrase about economics that came into her head." He's correct also that she's unfit to be entrusted with the power of the modern presidency.
But Mr. Zakaria is incorrect to suppose that these traits separate Gov. Palin from other candidates for high political office. Calls by Senators McCain and Obama for cracking down on "speculators" are full of classic and wrongheaded catchphrases, as is Sen. Obama's vocal skepticism about free trade. Gov. Palin is merely less skilled in passing off inanities and claptrap as profundities.
More importantly, no one is or ever can be "ready" or "qualified" to exercise power of the sort that is concentrated today in Washington. A country of 300 million persons, each with his or her own unique desires, talents, and knowledge, cannot be wisely regulated in the detail and intrusiveness demanded by the modern state.
and with a UCLA connection. The number is 243,112,609-1, it has 13,000,000 digits, and it wins for the Great Internet Mersenne Prime Search and the UCLA Math Department "a $100,000 prize from the Electronic Frontier Foundation for being the first to find a prime number that has more than 10 million digits."
"More prizes remain to be claimed: a $150,000 award for a prime with 100 million digits, and a $250,000 award for one with a billion digits." And remember the good news: As even some people from 2000 years ago could tell you, there's sure to be an even larger number somewhere between this one and its factorial plus 1. So get going, folks! (Well, OK, even between this one and twice this one, but that's harder to prove.)
Thanks to my UCLA undergraduate classmate and now computer science professor Haym Hirsh for the pointer.
"It's pretty disappointing to see that given that the government is now plotting the single largest power grab in our lifetimes, the Libertarian blogosphere is hardly as up in arms as one would expect."
On the other hand, as distasteful as the bailout is, if (and that's a very, very, big if), as a practical matter (i.e., even if there are better alternatives, this is the best we are going to do in practice) the alternative is a complete meltdown of our financial system, friends of liberty are in a bind; the bailout is awful, but the current power grab by Washington is nothing compared to what we could expect if, say, commercial lending virtually ceased, and the stock markets fell an additional 50%. I suspect that this dynamic explains why opposition in the libertarian blogosphere is relatively muted; we bloggers don't know how big a threat there really is to our financial system, nor do we know whether, if the bailout fails, whatever winds up happening instead, including future legislative action, will actually be better.
That's what McCain said at the debate, but he didn't articulate his meaning well at all. Let me give it a shot. Let's say Congressman X is an idealistic young Congressman. Some constituents in his rural district ask him to get federal funding for a new emergency room in a local hospital, because the nearest emergency room is 100 miles away. Congressman X is skeptical of earmarks, but this particular one both seems like a good idea and a way to help ensure his reelection--he won his first term with only 52% of the vote. He manages to slip the hospital funding into an appropriations bill.
Soon thereafter, Congressman X becomes aware of a new $5 billion initiative that is a complete and utter boondoggle, but will benefit the districts of several influential congressmen. He starts sending out press releases opposing the initiative, and threatens to a force a vote on an amendment removing the initiative from the bill to which it is attached.
The senior Congressmen who support the initiative schedule a meeting with Congressman X. Like mafia thugs, they tell the Congressman, "It would be a real shame if anything was to happen to your hospital funding--and any future funding for your district, for that matter." The message is clear; if Congressman X wants any hope of bringing federal money into his district, he had better stop opposing wasteful spending supported by his colleagues. He drops his opposition to the $5 billion project, gets the hospital funding, is reelected easily, and never again shows any "spending hawk" tendencies. Soon, in fact, he is rather senior himself, and finds himself meeting with a junior Congressman, telling him "It would be a real shame if anything was to happen to your hospital funding--and any future funding for your district, for that matter."
So, even though earmarks are a small percentage of the federal budget, they are a very important part of a broader system of corruption that leads to out-of-control federal spending.
Did the revisions to the Bush Administration's proposed bailout bill improve it? Here's a highly unscientific Instapoll. One thing is for sure, it's much longer now -- it went from three pages to 110 pages. There's also lots of fodder for Administrative Law exams.
Former attorney general Alberto R. Gonzales will not be referred to a federal grand jury for his role in the 2006 firings of nine U.S. attorneys, but a long-awaited report to be released today will recommend that a prosecutor continue to probe the involvement of lawmakers and White House officials in the episode, according to two people familiar with the case.
I think David Post is engaging in more than a bit of wishful thinking in his post below. We know he's not a Palin fan, was never a potential McCain supporter, and doesn't exactly have his finger on the pulse of contemporary conservative thinking. There's not "something of a drumbeat building" for a Palin withdrawal (at least not yet). Some conservatives were down on Palin from the beginning, so it should be no surprise that a stray columnist or two — even one who had her article posted on NRO — thinks Palin should pull out after her poor (and occasionally painful) interview performances.
For a better sense of mainstream conservative thinking about Palin right now, I'd point to this Kathryn Lopez column on NRO, which expresses concerns about Gov. Palin, but is not yet ready to throw her overboard. Here is how she concludes:
I’m not where my friend Kathleen Parker is — wanting her to step aside to spend more time with her family and Alaska — but that’s not a crazy suggestion. She's right to say that something’s gotta change.
My guess — based on nothing but hope for a change — is that Sarah Palin just needs some freedom. I don’t know who is holding her back but if John McCain wants to win this thing it had better not be him and his staff. When I watch these interviews, I see a woman who looks like she’s stayed up all night studying and is trying to remember the jurisprudential chronology of privacy vis-a-vis reproduction, the war on terror, and public figures (add 12 more things, described in the most complicated way possible, to the list to be more accurate). She looks like a woman who’s been cramming talking points and great Matt Scully lines and Mark Salter-McCain war stories and Steve Schmidt marching orders into her head since that first plane ride from Alaska. She looks like a woman who has ceased being the confident, successful executive who got herself elected governor of Alaska without the full force of her party behind her and managed to have an approval rating of which most can’t even dream.
This seems wholly unnecessary. People love Sarah Palin when they see her. When she’s firing at full force, she comes off as authentic, self-possessed, and ready for a fight. If that is Sarah Palin, that’s the Sarah Palin who should be talking to everyone she can. . . .
If Sarah Palin is John McCain’s secret weapon, let her go, whoever is holding her back. And, frankly, if it turns out that the “authentic” Palin of rallies and the Republican convention is just good speech delivery in a woman with some good spirit, I want to know that sooner rather than later. (Mitt’s still available. Someone in Washington who can actually run a business and knows something about the economy will come in handy once the federal government owns the U.S. banking system.) But if the Palin we know and love and have projected our hopes for sanity in American politics is the real Sarah Palin — then come out from the shadows, woman. You’re the one who is going to win this election. Be yourself. Otherwise, what’s the point?
McCain needs to liberate his running mate from the former Bush aides brought in to handle her — aides who seem to have succeeded in importing to the Palin campaign the trademark defensive crouch of the Bush White House. McCain picked Sarah Palin in part because she’s a talented politician and communicator. He needs to free her to use her political talents and to communicate in her own voice. . . .
That debate is important. McCain took a risk in choosing Palin. If she does poorly, it will reflect badly on his judgment. If she does well, it will be a shot in the arm for his campaign.
I think this is right. This year's vice-presidential debate will matter far more than most, largely due to lingering questions about Palin. But I also believe that a strong Palin performance will put these concerns to rest among those for whom this matters (i.e. those who, unlike David, might vote for McCain), and reinforce the meme that the mainstream press is out to get her (and help elect Obama). Selectively edited TV interviews will not have the same force as an unedited debate.
As for what will happen, Kristol reports Senator McCain is unhappy with how the McCain has been handling her, and is demanding changes. Byron York also has this interesting post.
Now, back to our regularly scheduled programming (and try to keep the comments civil).
UPDATE: In the comments below, David objects to my claim that he "was never a potential McCain supporter," explaining that and might have supported McCain given a different vice presidential choice. He writes:
I was a (strong) supporter of McCain's during the Republican primaries, and I was genuinely delighted that he won the nomination; I actually had not decided for whom to vote in the general election until the Palin nomination, which I believed, and still believe, was an irresponsible, outrageous, and unpatriotic act on McCain's part.
I based my characterization of his views based on his disclosure in this post that he was "not voting" for McCain. I took this to mean that David had decided to not support McCain prior to the Palin decision.
As for myself, I am still somewhat undecided -- both about whom I will support come November and what to make of Gov. Palin. Her Couric interview performance was atrocious, but I've seen plenty of other interviews (and debate performances) that give a very different impression. I also know several people who have found her quite impressive in person. So, at this point, while objecting to anti-Palin arguments I find unfounded and unpersuasive -- and noting that many of the attacks on her are equally applicable to Senator Obama and others -- I'm withholding my final judgment about her and the GOP ticket.
I hate to say I told you so, but I told you so. Right after Palin was nominated, I called her grotesquely underqualified to be President, and I was right. She's not underqualified because she is inexperienced, she's underqualified because she is a knucklehead. Here's her exchange with Katie Couric on the bailout, surely one of the major, if not the major, domestic issue of our time:
COURIC: Why isn't it better, Governor Palin, to spend $700 billion helping middle-class families who are struggling with health care, housing, gas and groceries; allow them to spend more and put more money into the economy instead of helping these big financial institutions that played a role in creating this mess?
PALIN: That's why I say I, like every American I'm speaking with, were ill about this position that we have been put in where it is the taxpayers looking to bail out. But ultimately, what the bailout does is help those who are concerned about the health-care reform that is needed to help shore up our economy, helping the—it's got to be all about job creation, too, shoring up our economy and putting it back on the right track. So health-care reform and reducing taxes and reining in spending has got to accompany tax reductions and tax relief for Americans. And trade, we've got to see trade as opportunity, not as a competitive, scary thing. But one in five jobs being created in the trade sector today, we've got to look at that as more opportunity. All those things under the umbrella of job creation. This bailout is a part of that.
John McCain is going to be 72 years old -- and he has had two bouts of melanoma. We face a situation quite possibly as dire as the one we faced in 1932, and it is both terrifying and absurd to suggest putting Gov. Palin that close to the Oval Office. Here's how Zakaria put it:
Can we now admit the obvious? Sarah Palin is utterly unqualified to be vice president. She is a feisty, charismatic politician who has done some good things in Alaska. But she has never spent a day thinking about any important national or international issue, and this is a hell of a time to start. The next administration is going to face a set of challenges unlike any in recent memory. There is an ongoing military operation in Iraq that still costs $10 billion a month, a war against the Taliban in Afghanistan and Pakistan that is not going well and is not easily fixed. Iran, Russia and Venezuela present tough strategic challenges.
Here's how I put it, the day after she was nominated:
Absolutely nothing suggests that Sarah Palin would be credible as President of the United States. I do NOT think this is just a matter of adding up the number of years spent doing this or doing that. Sarah Palin has been in public life, basically, for two years. to my knowledge, she has never articulated (because she was never called upon to articulate) any views whatsoever on:
military strategy in the Persian Gulf; the proper response to Iranian nuclear weapons; the Russian invasion of Georgia; the United Nations; US immigration policy; the Federal Reserve Bank; the effectiveness of international aid programs; Israeli-Palestinian relations; federal support for basic research; European Union integration; the US Constitution; the optimal means of protecting US borders from terrorists; Guantanamo, and the proper scope of interrogation techniques; Deficit financing; Keynesian economics; the Supreme Court.
Should I go on? I could, of course. But hopefully you get the idea. How anyone could say that knowing what they know now they'd be comfortable with her as President is entirely beyond me.
I know I promised, a while back, to desist from further comments on Gov. Palin because it was becoming a "distraction." But it's not a distraction anymore - the call for her to resign is part of the main event. In John McCain's first "presidential" act, he most emphatically did not put his country first, he put his flagging campaign first. He should correct that, now.
Chicago. Vanderbilt has 4, Michigan 3, Harvard and Yale 2, Duke, Penn, and Texas 1. Chicago has none. That does not mean, of course, that no one on the faculty prefers McCain to Obama. But it is striking that Chicago, once known as easily the most conservative of the elite law schools, doesn't have a single professor willing to publicly associate himself with the McCain campaign.
Back in August, I noted allegations that Amnesty International had sent out a press release condemning an official Israeli report on a shooting death in Gaza, apparently without having actually seen the report. I added:
Early yesterday morning, I emailed Amnesty's press contact for the Middle East, Nicole Choueiry, and introduced myself as blogger for the Volokh Conspiracy. I forwarded the NGO Watch link, and asked if she "could confirm or deny that Amnesty wrote its press release without having access to the full report the Israeli army made on the incident?" I also asked "whether the basis for the underlying press release by Amnesty was a specific critique of the Israeli report on the incident, or was part of a general critique of Israel for not conducting independent investigations of civilian deaths in Gaza." (In other words, would Amnesty automatically condemn any report, no matter how thorough, issued by the Israeli army, because it was issued by the Israeli army). A few hours later Ms. Choueiry responded that she would get back to me with a detailed response shortly. I haven't heard back, but will let readers know if and when I do.
Ms. Choueiry never did get back to me, which I take as an implicit acknowledgment that Amnesty condemned the Israeli report without having seen it. I had reason to be suspicious of Amnesty's reports from the West Bank and Gaza before, but at this point I think it's fair to discount them entirely, at least until Amnesty replaces its local staff.
But the fact remains that this is a nasty and untrue rumor about Sarah Palin that's been circulating for weeks. If you're an Obama supporter who gets frustrated that people still believe he's Muslim or won't put his hand on his heart for the Pledge of Allegiance, you should understand the frustration that Palin supporters feel when this slime is taken at face value.
Actually, there's at least one big difference. A recent New York Timesopinion piece spreading the rape kit myth was the New York Times's most emailed article on Friday, and as of this writing, is still number 10. I'm pretty confident that the Times hasn't been spreading the "Obama is a Muslim" rumor. Here's a suggested motto for the Times: "The WorldNet Daily of the Left." Doesn't quite have the same ring as "All the News Fit to Print," but increasingly, it's becoming more accurate.
UPDATE: By the way, the Slate piece doesn't take the rumor apart quite as well as other pieces I've seen, in particular this piece at Newsbusters, which concludes:
In the end, it seems that this story is a wild exaggeration about Palin's role in this policy. There is no proof that she ever knew about the policy until long after the situation hit the news, it is untrue that her town was "unique" in blocking the measure, no evidence that she, herself, was notorious for the policy, and no proof that any victims were ever charged for rape kits. In fact, according to the Uniform Crime Report there were only 5 rapes reported in the 6 years she was mayor of Wasilla and four of those happened after the state law in question was passed.
By contrast, consider the Times piece in question: "When Sarah Palin was mayor of Wasilla, Alaska, the small town began billing sexual-assault victims for the cost of rape kits and forensic exams." [False on two counts; no one was billed, and to the extent there was an official policy to the contrary, it wasn't started under Palin's watch]
"That's also why, when news of Wasilla’s practice of billing rape victims got around, Alaska's State Legislature approved a bill in 2000 to stop it." [False, Wasilla wasn't mentioned at any of the hearings on the bill; other towns were.]
"In the absence of answers, speculation is bubbling in the blogosphere that Wasilla's policy of billing rape victims may have something to do with Ms. Palin's extreme opposition to abortion, even in cases of rape." [Completely made up. The author seems to think, apparently incorrectly, that rape kits contain a morning-after pill.]
A Bit More on the Obama "Truth Squad" in Missouri:
(1) Commenter John_R points to a statement from one of the prosecutors mentioned in the news story, who says that "As a citizen, I believe that elections should be about issues. I also have enormous respect for our First Amendment and freedom of speech. My sole purpose in participating in this initiative is about getting truthful information to the voters. This has never been or never will be about prosecuting people."
(2) The question, is what the source is for the television station's saying that the prosecutors and sheriffs "also say they plan to respond immediately to any ads and statements that might violate Missouri ethics laws." Recall that, as I mentioned in my post, this was the narrator's statement, rather than something come out of the mouth of a prosecutor or a sheriff. Did the station misunderstand what was going on? Or did at least some sheriffs or prosecutors in fact say that they plan to focus on allegedly illegal ads, presumably by using their law enforcement authority? (If so, did they say it themselves, or were they responding to a TV station question, and what exactly did they say?)
(3) I should note that if the prosecutors or sheriffs did threaten enforcement of Missouri ethics laws — which I take it refers to election laws — here, it appears that Missouri election law generally doesn't ban false statements in campaigns, and though it bars false designations of who sponsored an ad, it apparently applies only to state and local campaigns, not federal ones. (Thanks to Rob Wechsler for pointing this out.) If that's right, then even if the prosecutors or sheriffs made general statements of the "we will evenhandedly enforce election laws against people making false statements of sponsorship" variety, they would be misstating their power on this subject. But again that all depends on what the sheriffs or prosecutors (or some subset of them) actually said on the subject.
(4) Some commenters suggested that the prosecutors and sheriffs are still at fault for implicitly threatening prosecution. The difficulty is again that it's not clear just what the prosecutors and sheriffs said to the TV station. The report does, as I said, suggest the risk of such prosecution, but that's the work product of the station, not the Truth Squad. It's not clear what, if any, the officials' role was in framing the report.
(5) Is it inherently threatening, though, to have law enforcement officials on such campaign organizations, especially ones that take a hard-hitting rhetorical tone? I don't think so, at least at this point in our political history. (Things might be different if state and local prosecutions of critics of political candidates were more common than they are.) And there's a legitimate reason to include prosecutors and sheriffs on such organizations, because in many places they are pretty well-known and trusted politicians, precisely the sorts of politicians that can lend their credibility to rebutting campaign allegations.
And, as the STLtoday Political Fix blog points out, the McCain Truth Squads also involve at least some law enforcement officials. A quick search uncovered the South Carolina Attorney General, and the Political Fix blog post reports that "a McCain Truth Squad in New Hampshire, formed last January, that included several public officials with prosecutorial powers, including the state attorney general."
In any case, I'd love to hear more factual information about what exactly was said, and by whom.
Here. A quick skim reveals no surprises: more elaborate reporting and oversight requirements but not clear they have teeth; some limitations on (equitable) judicial review that I don't think were present before; the strange Republican insurance plan (discretionary); and various bells and whistles.
The Rasmussen Reports daily Presidential Tracking Poll for Sunday — including the first day of post-debate polling — is unchanged. Barack Obama once again attracts 50% of the vote while John McCain earns 44%. This six-point advantage matches Obama’s biggest lead yet and marks the first time he has held such a lead for two-days running. Obama is now viewed favorably by 57% of voters, McCain by 55%.
As the economic crunch continues, just 11% of Americans now say the nation is heading in the right direction. That’s down dramatically from 24% two weeks ago when the failure of Lehman Brothers first brought the Wall Street debacle to the world’s attention. Since then, consumer and investor confidence have plummeted and nearly 80% of the nation’s adults now believe the economy is getting worse. Adding to the frustration is growing opposition to the proposed rescue plan and doubts about the motives of those promoting it.
UPDATE: Gallup's move from 5% to 8% in Sunday's release indicates that Saturday's polling was 8-10% stronger for Obama than Wednesday's.
Some people have mentioned this story to me — there's been a lot of buzz about this story over the past few days — and I think there might be something troubling going on. But I think we may be lacking some important information, so let me lay out the facts as I know them, and ask readers whether they can point me to more.
As best I can tell, it all started with this report from a Missouri TV station. The report points to Missouri prosecutors and sheriffs who have joined the "Obama Truth Squad," and says "They" — referring to the prosecutors and sheriffs — "also say they plan to respond immediately to any ads and statements that might violate Missouri ethics laws." The text accompanying the report also says, "The Barack Obama campaign is asking Missouri law enforcement to target anyone who lies or runs a misleading TV ad during the presidential campaign."
Now the "plan to respond immediately to ... statements that might violate Missouri ethics laws" does sound like a threat of prosecution, since that's how law enforcement tends to respond to violation of the law. But most of the statements in the interview, including all the statements that actually come out of the sheriffs' and prosecutors' mouths, seem to focus — or at least can be very plausibly interpreted as focusing — on responding to false or misleading statements with rebuttals, the normal way such responses happen in election campaigns.
So this makes me wonder exactly what the sheriffs and prosecutors are saying about law enforcement; recall that the statement in the news story about violations of the law came from the mouth of the narrator, not one of the sheriffs or prosecutors who was interviewed. Did the sheriffs and prosecutors mostly talk about responding with counterspeech, and talked about ethics laws enforcement only in response to an interviewer question (e.g., "But what if you find actual illegal conduct — would you also take legal action?")? What kinds of violations were they discussing? Did they make the paraphrased statement in the context of promising evenhanded enforcement of election laws, or were they focusing on anti-Obama statements (which is indeed the context of the statements that were quoted)?
I am troubled by the way the statement appears in context, since it does suggest likely law enforcement targeted on critics of Obama, and perhaps the sheriffs and prosecutors should have spoken up to correct this impression, if they hadn't intended to send it. But I don't know whether they have indeed tried to say something along these lines (among all the other things I don't know, despite having listened to the broadcast and read several posts that criticized the broadcast). [UPDATE: One of the prosecutors quoted in the story has indeed said that "My sole purpose in participating in this initiative is about getting truthful information to the voters. This has never been or never will be about prosecuting people."] The Missouri Governor's press release condemning the statements doesn't add much by way of detail.
Now some might argue that it's troubling whenever sheriffs or prosecutors get involved in broader political campaigns, because even pure promises of constitutionally protected counterspeech might be seen as implicitly threatening legal suppression of protected speech, or as discriminatory enforcement of otherwise valid speech restrictions. But these are elected officials, who are identified with particular political parties. As I understand it, in our political system it's normal for such officials to get involved in broader campaigns on behalf of the party, and while perhaps there should be an exception for law enforcement officials, I'm not sure that this is a settled tradition, and there would be costs as well as benefits to such a tradition.
As I said, there may well be something potentially troubling here, for instance if the prosecutors and sheriffs are threatening to enforce very broad (and perhaps unconstitutional) readings of election laws, or if they are threatening to enforce the laws only against anti-Obama speakers. But before figuring out just how troubled I should be here, I'd like to know more about what exactly the prosecutors and sheriffs said.
I'd also like to know what laws it sounds like they're threatening to enforce. My quick search couldn't find any "Missouri ethics laws" that ban false or misleading statements in a campaign. (Some states have such laws, and they have sometimes been upheld, if they are narrowly drafted to cover only knowingly or recklessly false statements, but I don't see any such Missouri laws — please let me know if I've missed some.) I did find laws that require that sponsors of paid ads supporting or opposing candidates identify themselves, and banning false or misleading identification in such ads. [UPDATE: As I note in the follow-up post, it looks like even this ban on false or misleading sponsorship identification doesn't apply to campaigns for federal office.]
I should note that Missouri apparently has no criminal libel statute (as my own quick Westlaw search confirmed), and the statement I heard in the TV segment focused on "Missouri ethics laws," not criminal libel laws. Some suggestions that the threat is of criminal libel prosecution strike me as unlikely.
So I stress again: There might well be something troubling going on, especially if the prosecutors and sheriffs haven't tried to clarify the paraphrased threat of law enforcement [UPDATE: One of the prosecutors has clarified this, as the Update above notes]. But before I know how troubling this is, I'd like to know more exactly about what they're threatening, and what the relevant Missouri laws are. If anyone has more factual details on this, I'd love to hear them.
Here’s a recap. Paulson sought to give Treasury the power to buy mortgage-related assets. A power grab!, said the critics. So congressional Democrats sought to give Treasury the power to buy mortgage-related assets, non-mortgage-related assets, and equity interests, and to regulate executive pay. Socialism!, said the congressional Republicans. So the final bill gives Treasury the power to buy mortgage-related assets, non-mortgage-related assets, and equity interests, and to regulate executive pay, and to issue insurance to distressed institutions. Madisonian deliberation at its finest!
Meanwhile, VC readers might be interested in other law-blog commentary:
David Zaring on the possible legal non-issues raised by the possible bailout law (actually even less than meets the eye). Jeff Lipshaw on what’s going on with the AIG bailout (remember the AIG bailout?). (For critics of my earlier post questioning the legality of the AIG bailout, note Lipshaw’s conclusion: “So.... I take back what I said about the Fed not actually owning AIG. It does. And it will, because there is no provision for the redemption of the preferred shares if the loan is paid back.”) Steven Davidoff on everything else that everyone is ignoring. See also Randy Picker; Larry Ribstein (you might also read his prescient article, “Bubble Laws,” which uses a nice phrase, if I remember correctly – “speculative bubbles of regulation”); and Stephen Bainbridge.