Saturday, May 23, 2009

"Counterterrorism and the Obama Administration":

Looks like a very interesting conference, put together by the Federalist Society's International & National Security Law Practice Group, this coming Thursday at the Capitol Visitor Center in Washington, D.C.

The panels will include Detention and Trial of Terrorist Suspects, Preventing Attacks through Interrogation and Transfer of Terrorist Suspects, and Preventing Attacks through Surveillance and Intelligence. As is usual for Federalist Society events, the panels have people from both left and right (and other places); the ACLU and Human Rights First, for instance, are prominently featured.


Rio Bravo Reconsidered: Rio Bravo was never one of my favorite westerns but, but after reading Haunted by the Memory of Her Song: Fifty Years of ‘Rio Bravo’, I may have to see it again. Here is how it begins:
Exquisitely crafted, but never ostentatious. Pleasantly mellow, but never lazy. Thematically rich, but never preachy. Respectful of tradition, but never stolid. Deeply compassionate, but never descending into schmaltz. Five decades ago, a group of men now long-dead (and, it must be said, one smokin’-hot woman, still-living) followed an aged veteran director into the Arizona desert to make a humble, heartfelt western based firmly on quintessentially American notions of courage, decency, and good humor. The result of their collaboration, Rio Bravo (1959), remains one of the great visceral pleasures of cinema.

Howard Hawks’ masterpiece stemmed from his disgust with the joyless anti-heroics of uptight, melodramatic westerns like Fred Zinnemann’s High Noon (1952) and Delmer Daves’ 3:10 to Yuma (1957) — dark “message movies” that seemed to revel in smugly depicting small-town Americans as cynics and cowards. The man behind such classics as Scarface (1932), Only Angels Have Wings (1939), To Have and Have Not (1944), Red River (1948), and Gentlemen Prefer Blondes (1953) was in his early sixties in 1958, his career winding down after decades of constant production. He had interned for Famous Players-Lasky way back in 1916, and directed his first features in the mid-1920s. Thirty years later he was old and tired, and his last film, Land of the Pharaohs (1955), had been a disheartening flop. Since then, the previously prolific director hadn’t helmed a picture in three years, an unheard-of period of self-exile for a man who had cranked out movies regularly for decades. But the brazen slap across the face that High Noon had given America’s western mythology had bothered him. “I made Rio Bravo,” he later told an interviewer, “because I didn’t like High Noon. Neither did Duke. I didn’t think a good town marshal was going to run around town like a chicken with his head cut off asking everyone to help. And who saves him? His Quaker wife. That isn’t my idea of a good western.”
I found this point particularly interesting:
Most crucially, it was director Hawks who crafted John Wayne’s character into a master not only of action but of reaction, in the process establishing an overriding feeling of camaraderie that makes the film endlessly rewatchable. “John Wayne represents more force, more power than anyone else on screen,” Hawks claimed, and yet by dint of directorial will the star of Rio Bravo becomes everyone else’s straight man. During the course of the plot the Duke gets socked by Dean Martin (twice!), is verbally out-dueled by the precocious Ricky Nelson, suffers the outrageous behavior of Walter Brennan, is relentlessly teased by the ever-flirtatious Angie Dickinson, and is continuously rescued by all of the above. “You give everybody else the fireworks,” Wayne grumbled to Hawks at one point, “but I have to carry the damn thing.”

And yet Hawks knew that, with a universe of talents at his disposal, Wayne’s secret weapon was always his generosity and humility as an actor, his penchant for binding himself and his ego to the needs of a picture. He was unparalleled in his ability to lend his potent movie-star glow to others in a scene, holding up the entire business like a grizzled, enduring Atlas. For Rio Bravo, the breakthrough came during one of Dean Martin’s many set-pieces, while Wayne was standing aside and watching glumly as Martin got to once again chew up the scenery with his performance. “What do I do while he’s playing all of these good scenes?” he finally asked Hawks in frustration.

“Well,” Hawks replied, “you look at him as a friend.”

Suddenly everything Hawks had been striving for, the entire emotional spectrum he was meticulously constructing, became clear. And throughout the finished Rio Bravo, you can go to any point and see the spectacular results of Wayne embracing Hawks’ perceptive direction. Watch, for instance, the scene after Walter Brennan’s character Stumpy has almost killed Dean Martin by carelessly shooting at him through the jailhouse door. Wayne stands by as Brennan, one of the all-time great scene-stealing character actors, goes through an entire blabbering monologue of words and emotions that covers denial, mortification, and finally a resigned acceptance of responsibility. It’s all great stuff, hugely entertaining — but look closely at Wayne. Not a word spoken, not a single word. And yet his pitch-perfect reactions to each of Brennan’s lines gives the scene its touching pathos and power.

Wayne spends virtually the entire film loaning his star power to others in this fashion, not acting so much as reacting, and using those reactions to give his co-stars a much brighter spotlight in which to shine. Indisputably, we have Howard Hawks to thank for that. The Duke was known to sometimes distrust and argue with lesser directors, but along with John Ford only Howard Hawks commanded his absolute respect. “Hawks I trust with my life,” he once declared, a sentiment amply proven by the fearless bigheartedness of his performance in Rio Bravo. Both star and director were so happy with the way their collaboration went (only their second time working together after Red River eleven years before) that they more or less remade the same plot twice more in later years, as El Dorado (1966) and Rio Lobo (1970). The relationship was a special one. Long after both Hawks and Wayne had died, Peter Bogdanovich (who knew both) recalled in an interview that “The last times I saw both Cary Grant and John Wayne, they both talked about Howard, about missing him.”
While on the subject of John Wayne, consider this: Guess Who’s the Third Most Popular Movie Star in America Today?
No, it’s not any of those celebrities we’re told are stars. DiCaprio and George Clooney didn’t even make the top 10. Neither did Ashton Kutcher, Sean Penn, Brad Pitt, Seth Rogen, Matt Damon, Will Farrell, or Tom Cruise.

Every year for about 15 years now, Harris Interactive has conducted a nationwide poll and asked a very simple question: “Who is your favorite movie star?” And every year since the taking of the poll one particular individual has placed in the top ten — 13 of those years in the top 3.

This year, 2,388 U.S. adults were surveyed and this star rose three places to tie Will Smith for third. Only Denzel Washington and Clint Eastwood rank as more popular.

One last hint before the reveal: This star is the only actor in the history of the poll to rank posthumously:
John Wayne

Big News: Ghostbusters III filming soon with original cast.
In a recent interview with the Los Angeles Times, Dan Aykroyd revealed that the third Ghostbusters movie could start filming soon. He said that all the original cast have now signed on, including Sigourney Weaver, Bill Murray, Harold Ramis, Ernie Hudson and of course Aykroyd himself.
Well, OK, not really such big news. But it is a Saturday.

Hisself, My Son, and a Thought About Prescriptivism:

My five-and-a-half-year-old used this word a few days ago, and I gently corrected him. We say "himself," I said, not "hisself." I'm a descriptivist when it comes to determining what is "correct"; but I want my child to learn not just any correct way of speaking, but the way that is going to best help him get ahead in life, which sometimes mean the mode of speaking that is most satisfying to self-described "purists." Plus even a descriptivist treats deviations from standard usage as errors, at least in contexts where standard usage is expected (as opposed to, for instance, when one is consciously trying to speak a particular dialect). A Google search reveals that "himself" is nearly 100 times more common than "hisself," so I'm happy to say that "himself" is the standard term and "hisself" is nonstandard.

But of course I also wanted my boy to get a sense of the patterns in the language, so I pointed out the analogies -- "herself," "themselves," "myself." Wait a minute! It's "myself," not "meself," and "ourselves," not "usselves"; the first-person reflexive uses the possessive ("my" and "our") followed by "self" or "selves." But the others use the objective ("him," "her," "them") and not the possessive.

And what is it that tells us that "myself" and "himself" are right, while "meself" and "hisself" are wrong? Not any supposed inner logic of the language, it seems to me, but simply usage: "Myself" and "himself" are standard among educated English speakers, at least outside narrow regional dialects, and "meself" and "hisself" are not. What is right to say in English is what educated English speakers say.

So when I hear prescriptivists argue using what I think of as "logical prescriptivism" -- this spelling or usage is right and that is wrong because of some inner logic of the word, or because of an analogy to other words -- I remember examples like this. Or I remember how "aren't I right?" is right and "amn't I right?" is at least extremely unusual; or how "it's" as a possessive of "it" remains nonstandard in educated edited prose, even though for non-pronouns this is exactly how possessives are formed.

To be sure, logic and analogy have their uses in language. They can sometimes be good mnemonics. They can sometimes be good guides to what will come across as confusing, or will arouse the wrong associations. They can be good guides when creating new terms, and trying to make them clear and normal-looking. But when usage conflicts with the supposed logic of the language, usage prevails. If it didn't, we'd be saying "hisself" and "myself," or "himself" and "meself."


Friday, May 22, 2009

Gov. Sanford Sues Legislature:

The South Carolina state legislature passed a budget purporting to require Governor Marc Sanford to accept $350 million of federal stimulus money. Governor Sanford has responded by filing suit against the state legislature. According to The State:

Sanford said the case is about power, not money, and who will have it.

“This is not about the vetoes, and it’s not about the stimulus,” Sanford said. “What this case is ultimately about is balance of power in this state.

“This is about the larger question of why have a governor if their hands are constantly tied?”

Sanford had refused to accept the money unless the state pays off an equal amount of debt, something state lawmakers said they could not afford to do this year because the state has cut $1 billion from its budget. The budget, approved Wednesday, requires Sanford to accept the money within five days.

Lawmakers, the governor said, have overstepped their authority and tried to rewrite federal law.

But members of the GOP-controlled General Assembly said the Republican governor has lost the debate and it is time to move on. Otherwise, a July 1 deadline from the U.S. Department of Education means South Carolina could lose a portion of its stimulus money, they said.

Here is the complaint. Meanwhile, a second suit has been filed against the Governor to force him to accept the money.


Radio Host Waterboarded, Says It's Torture:

Talk radio host Eric "Mancow" Muller had himself waterboarded on his radio program to see whether it constitutes torture.

With a Chicago Fire Department paramedic on hand, Mancow was placed on a 7-foot long table, his legs were elevated, and his feet were tied up.

. . . Witnesses said Muller thrashed on the table, and even instantly threw the toy cow he was holding as his emergency tool to signify when he wanted the experiment to stop. He only lasted 6 or 7 seconds.

"It is way worse than I thought it would be, and that's no joke," Mancow said, likening it to a time when he nearly drowned as a child. "It is such an odd feeling to have water poured down your nose with your head back . . . It was instantaneous . . . and I don't want to say this: absolutely torture."

"I wanted to prove it wasn't torture," Mancow said. "They cut off our heads, we put water on their face . . . I really thought 'I'm going to laugh this off.' "

In this regard, Mancow's experience was much the same as Christopher Hitchens and former OLC official Dan Levin.


Government Funding and the Free Speech Clause:

Occasionally I see people suggest that private universities are bound by the Free Speech Clause if they get government funding, in the form of various research grants, student loans, and the like. But that's not the law: The Free Speech Clause applies only to decisions by the government (including government-run institutions such as public universities). It generally does not apply when the government merely provides funds to a private institution, that then makes speech-restrictive decisions without command or pressure from the government. The Court squarely held this in Rendell-Baker v. Kohn (1982).

The government may by statute impose many conditions on the use of government funds -- that's what Congress did with Title VI and Title IX (which generally bar recipients of federal funds from discriminating based on race and sex) and with the drinking age. Congress thus probably could mandate that no university which receives federal funds may restrict student speech. (I say "probably" because there are some twists which I set aside for now.) But Congress hasn't enacted such a statute, and it is of course under no obligation to do so.


Guns in National Parks:

The on-line New York Times has a daily feature called "Room for Debate." The paper picks a topic for the day, and posts short essays from five experts. Today's topic is Guns in Parks: Safe, Scary or a Sideshow?. My essay on the topic supports the new federal law, and praises President Obama for signing it, because the law simply says that federal lands should follow the same policies as their host states. The four other essayists include Jens Ludwig and John Lott.


Original Meaning and State Constitutional Rights to Keep and Bear Arms:

A very interesting exchange in an Alaska Court of Appeals decision, having to do with whether nonviolent felons have the right to bear arms under the Alaska Constitution's right to bear arms provision, which was most recently amended in 1994. Thanks to Steven Wells for the pointer.


New Justice Department Opinion on the Ineligibility Clause (Sometimes Also Called the Emoluments Clause):

There's been talk about whether Sen. Hillary Clinton is disqualified from a position as Secretary of State by the Ineligibility Clause:

No Senator or Representative shall, during the Time for which he was elected, be appointed to any civil Office under the Authority of the United States, which shall have been created, or the Emoluments whereof shall have been encreased during such time ....

A Jan. 2008 executive order, promulgated pursuant to a 1990s cost of living adjustment statute, raised the salary of the Secretary of State, so the Ineligibility Clause question is in play. Congress's solution to the problem was the application of the so-called "Saxbe Fix" (named after a previous beneficiary of the approach): Lowering the salary of the office to the salary in effect before the appointee's current term.

A 1987 Justice Department Office of Legal Counsel opinion opined that the Saxbe Fix is unconstitutional, but a new opinion, released by the same office last week, reaches the contrary view: The Saxbe Fix, it concludes, cures the Ineligibility Clause problem. I tend to agree, for the reasons I tentatively suggested some months before, chiefly that "the Emoluments whereof shall have been encreased during such time" is most plausibly read as "shall have been increased or not" rather than "shall have been increased at least once." (As I suggested, if you're thinking about buying a computer, for instance, and you ask "Has the price of this computer been increased during the last year?," it seems to me more plausible that you would mean "Has it been increased so that it now costs more than it cost a year ago?," rather than "Has it been increased at all, even if the price hike was entirely rolled back a month later?")

Also, as I noted before, the bulk of recent precedent from the Legislative and Executive Branches — both Democrats and Republicans — supports the view that the Saxbe Fix is constitutional.

UPDATE: Judicial Watch, which is challenging Hillary Clinton's appointment, has put up all the documents — including their complaint and the motion to dismiss, as well as the OLC opinions — on their Rodearmel v. Clinton page.


Prop 8 decision Tuesday:

After a longer-than-anticipated delay, the California Supreme Court will issue its opinion in the Proposition 8 challenge on Tuesday at 10 a.m. Pacific time. There are two basic questions before the court:

(1) Is Prop 8 a valid "amendment" of the state constitution or an invalid "revision"?

(2) If Prop 8 is valid, and thus marriage is now limited under the state constitution to one man and one woman, what is the status of the thousands of California same-sex marriages entered between June and November 2008?

The conventional wisdom has been that the court will uphold Prop 8 but will also declare that the interim same-sex marriages in the state are valid.


Liberty University De-Recognizes Democratic Club:

Is Liberty trying to make itself into a laughingstock?

Comments open for four hours.

UPDATE: For those who think that Liberty is "standing on principle," especially with regard to abortion, the especially stupid thing about Liberty's move is that political parties don't have fixed principles, they respond to their members and what they think will get them votes. The Republican Party was a pro-choice party until 1980 when evangelicals got influence. If you were trying to influence the Democrats to have principles more to Liberty's liking, the dumbest thing you could do is ban its students from being involved in the party.

And of course American political parties are not monolithic. The Democratic Party nationally may not be going pro-life any time soon, but that doesn't mean that you can't elect pro-life Democrats to state offices or perhaps even federal offices in Virginia. Even the national party may be swayable on issues like partial birth abortions or parental consent. So Liberty is not just making an intolerant stand (or a stand on principle), but a plain stupid one.


Bloggers: Pelosi hurt herself. Total split on gov't health insurance:

In this week's National Journal poll of political bloggers, all of the Right bloggers and almost all of the Left one agreed that Nancy Pelosi had hurt herself "with her handling of the waterboarding controversy." Most of the Left bloggres thought that she "Hurt herself a little," while the Right overwhelmingly picked "a lot."

I was in the latter group, and wrote: "The idea that the CIA might have lied to Pelosi, or might be lying now, is not implausible. The idea that Pelosi has been forthrightly providing a consistent version of what she knew and when she knew it appears impossible."

Question 2 asked about "including a new public insurance plan in health care reform." On the Left, 72% said that "Excluding it would be a deal-breaker," while the remainder wanted a public plan, but did not consider it essential. On the Right, 83% opposed a government plan, and 58% called it a deal-breaker. That group included me, and I wrote: "The government insurance program would inevitably benefit from taxpayer subsidies, making it less expensive, in the short run, than independent plans. Over time, the independent plans would be driven out of business, and even before then, many employers would force their employees into the government program. As private competition is eliminated, the imposition of Canadian-style rationing becomes feasible."


[Peter Leeson, guest-blogging, May 22, 2009 at 9:09am] Trackbacks
Pirates and the Law: A Retrospective

In the late 1720s the Caribbean pirates’ flourishing community was brought to a screeching halt. An enhanced British naval presence was partly responsible for this. But, as I discuss in The Invisible Hook, most important in bringing pirates to their end was a series of early 18th-century legal changes that made it possible to effectively prosecute pirates.

In the years before 1536 England tried pirates in its Admiralty courts under the civil law. Convicting an accused pirate proved very difficult, however. Civil law rules required an accused pirate to confess his guilt or two eyewitness, neither of whom could be accomplices, to testify to his piracy. Such eyewitnesses were hard to come by, and pirate confessions, even harder. Thus many pirates escaped conviction.

To rectify this problem, in 1536 England introduced the Offenses at Sea Act, which kept piracy a crime at civil law but allowed pirates to be tried via common law rules. Under this procedure the fate of accused pirates was decided by a jury of 12 men and, crucially, accomplice testimony was permitted.

The Offenses at Sea Act was helpful but eventually proved insufficient. In the 17th century, pirates were increasingly active in and around England’s distant and growing colonies. Under the 1536 law, accused pirates and potential witnesses had to be shipped to England for trial at the capturing colonial government’s expense. Rather than bear this cost, many colonial governments simply let pirates go instead.

Out of this unfolding of events emerged the Act for the More Effectual Suppression of Piracy, initially introduced by parliament in 1700. This act permitted colonial governments to try and execute pirates on location. (It also eliminated jury trials for pirates, placing their fate in the hands of colonial-appointed commissioners, but continued to permit accomplice testimony). No longer constrained by the need to send pirates to England for trial, the 1700 law proved to be a critically important legal change for bringing pirates to justice.

The initial act was set to expire seven years after its introduction but was made permanent in 1719 when the pirate population began exploding and when various additions to the act, such as rewards for capturing pirates, and punishments for pirate consorters, were also introduced. In 1721 further modifications were made, including a provision for punishing armed merchantmen that refused to fight their pirate attackers.

The effect of these early 18th-century legal changes was to significantly increase the risk, and thus the cost, of pirating after 1719 and 1721 in particular. Whereas only 31% of all pirates hanged between 1704 and 1726 (for which I have data readily available) were hanged in the 15 years spanning 1704-1718, 69% were hanged in the mere seven years spanning 1719-1726 (with the vast majority of these occurring in the years spanning 1721-1726). This posed a significant problem for pirates because as the legal cost of piracy rose, pirates’ ability to find willing recruits declined, threatening the viability of their criminal enterprise.

But pirates did not sit on their laurels in the face of tightening legal screws. Although they ultimately failed in their efforts, for a short time, at least, they succeeded in partially offsetting the rising legal costs of piracy, helping them to continue to find the recruits they sought. Pirates achieved this by exploiting a loophole in anti-piracy law that let off any man who could demonstrate to the court that he was a “forced man,” pressed against his will into pirates’ service. The “forced” defense was plausible since pirates sometimes did conscript sailors (though it seems that in general this was not the case, volunteers from overtaken ships sometimes being more numerous than the overtaking pirate crew was willing to have). Pirates exploited this loophole in several ways. But perhaps the most interesting was their reliance on “ads of force,” which proved to be a remarkable recruiting tool for pirates.

An ad of force was a newspaper ad, published by an allegedly conscripted sailor’s released captain or fellow seamen on behalf of their forced compatriot, publicly certifying that the sailor had been “forced against his will” to join so-and-so’s pirate crew on this such-and-such date, etc. If this pirate crew was ever captured--an increasingly likely event after 1719 and 1721 owing to the legal changes discussed above--the ostensibly forced sailor could point to his ad in his defense at his trial and the court might consider this evidence for his claim, thus increasing his chances of being let off.

Ads of force were an excellent invention for conscripted sailors. But they were equally excellent for volunteers who wanted a little insurance against the greater risk of their newly chosen trade. An ad of force was far from an iron clad means of getting off at a pirate trial. But it certainly helped. (It was most helpful when used in conjunction with other evidence of alleged innocence, which pirates also concocted, but which there’s not space to discuss here). Courts considered it and some sailors appear to have been acquitted at least partially on the basis of such ads--some no doubt legitimately, but for many others this was simply their pirate insurance policy paying off. Pirates thus managed to use ads of force to help offset the rising cost of piracy in the early 18th century and in some cases were eager to remind merchant sailors they sought to recruit that they could use this device to help persuade them to join.

Notably, the popularity of ads of force tracks the risk of pirating, which in turn tracks changes in anti-piracy law during this period, quite well. Of all those ads of force published in the Boston News-Letter between 1704 and 1726, for instance, only 7% appear in the 15 years spanning 1704-1718, while 93% appear in the mere seven years spanning 1719-1726, the bulk of these again appearing between 1721 and 1726.

As discussions begin moving forward about how legal changes might be used to help suppress modern pirates, it’s useful to look to the past to see what problems were confronted in prosecuting pirates historically, what was useful for overcoming these problems, and what wasn’t. Similarly, as modern pirates, eager to persuade courts of their innocence, begin to come under the purview of various nations’ legal systems, it’s useful to recall that pirates, like other people, are unlikely to be passive responders to the law. Rather, as (or if) the law becomes an important constraint on their behavior, pirates may seek to offset the law’s effects in unanticipated ways, manipulating the law as the law seeks to manipulate them.

As this is my final day guest-blogging for the week, I’d like to thank Eugene for kindly inviting me to do so and those of you who offered thoughtful comments for participating in the discussion. I greatly enjoyed the opportunity and conversation.


Can the FCC Search Your Home?

The FCC apparently thinks it can search your home without a warrant. Our own Prof. Kerr is skeptical.


A Recess Appointment for Johnsen?

With the Senate recessed over the Memorial Day break, will President Obama name stalled nominee Dawn Johnsen to head the Office of Legal Counsel through a recess appointment? It's quite possible. Senate Democrats vigorously objected to the use of recess appointments by President Bush, going so far as to officially keep the Senate in session over holidays. Yet now that Obama is President, Senate Majority Leader Harry Reid has ended this practice, making recess appointments a possibility. Stay tuned.

UPDATE: A reader with a better memory than I notes that, according to at least one OLC attorney serving in this Administration, any recess appointment over the Memorial Day break would be unconstitutional.


Schroeder to OLP:

BLT reports that Duke University law professor Chris Schroeder will be nominated to be Assistant Attorney General for the Office of Legal Policy. This is an excellent choice, and not just because Prof. Schroeder teaches both constitutional and environmental law. Among many other things, Prof. Schroeder is one of the folks behind Duke Law's Executive Watch blog. More background on the nomination here.


More on Allegedly Offensive Trademarks:

The Trademark Trial and Appeal Board of the U.S. Patent and Trademark Office refuses to register the trademark "Pussy", for use on various drinks, both alcoholic and nonalcoholic. Such a mark, the TTAB ruled, was prohibited by the statute, because it "consists of or comprises immoral or scandalous matter" (in the statute's words). Here's a nice block quote from the decision, itself quoted from an opinion that held the mark "Black Tail" (to be used for sexually themed magazines) was not immoral or scandalous, apparently because an alternative meaning of "tail" was simply "buttocks or the hindmost or rear end":

Compare In re Old Glory Condom Corp., 26 USPQ2d 1216 (TTAB 1993) (OLD GLORY CONDOM CORP, with stars and stripes design on condoms suggesting the American flag, not scandalous); In re In Over Our Heads Inc., 16 USPQ2d 1653 (TTAB 1990) (MOONIES on dolls, whose pants can be dropped to expose their buttocks, not scandalous); In re Hershey, 6 USPQ2d 1470 (TTAB 1988) (BIG PECKER BRAND on T-shirts not scandalous); In re Leo Quan Inc., 200 USPQ 370 (TTAB 1978) (BADASS for bridges of stringed musical instruments not scandalous); In re Madsen, 180 USPQ 334 (TTAB 1973) (WEEK-END SEX on magazines not scandalous); In re Hepperle, 175 USPQ 512 (TTAB 1972) (ACAPULCO GOLD on suntan lotion not scandalous); Ex parte Parfum L'Orle, Inc., 93 USPQ 481 (Pat. Off. Exam'r-Chief 1952) (LIBIDO on perfumes not scandalous) with In re Tinseltown, Inc., 212 USPQ 863 (TTAB 1981) (BULLSHIT on personal accessories scandalous); In re Runsdorf , 171 USPQ 443 (TTAB 1971) (BUBBY TRAP for brassieres scandalous); In re Sociedade Agricola E. Comerical Dos Vinhos Messias, S.A.R.L., 159 USPQ 275 (TTAB 1968) (MESSIAS on wine and brandy scandalous); In re Reemtsma Cigarettenfabriken G.m.b.H., 122 USPQ 339 (TTAB 1959) (SENUSSI on cigarettes scandalous); In re P.J. Valckenberg, GmbH, 122 USPQ 334 (TTAB 1959) (MADONNA on wine scandalous); Ex parte Summit Brass & Bronze Works, Inc., 59 USPQ 22 (TTAB 1943) (AGNUS DEI on metallic tabernacle safes scandalous); In re Riverbank Canning Co., 95 F.2d 327, 37 USPQ 268 (CCPA 1938) (MADONNA on wine scandalous); Ex parte Martha Maid Mfg. Co., 37 USPQ 156 (Comm'r Pats. 1938) (QUEEN MARY on women's underwear scandalous)....

[See also] In re Boulevard Entertainment Inc., 334 F.3d 1336, 67 USPQ2d 1475 (Fed. Cir. 2003) (1-800-JACK-OFF and JACK-OFF for entertainment in the nature of adult-oriented conversations by telephone held scandalous); Boston Red Sox Baseball Club LP v. Sherman, 88 USPQ2d 1581 (TTAB 2008) (SEX ROD for clothing held scandalous); In re Red Bull GmbH, 78 USPQ2d 1375 (TTAB 2006) (BULLSHIT for various alcoholic and nonalcoholic beverages, including energy drinks, and related services held scandalous); In re Wilcher Corp., 40 USPQ2d 1929 (TTAB 1996) (DICK HEADS’ and design for bar and restaurant services held scandalous).

(The opinion acknowledges that these decisions very much depend on the standards of the time, so that some of the older decisions might well not be followed today.)

Recall that after such a decision people remain free to sell and advertise products using the term; it's just that they don't get special protection against infringement that they would get if the mark were registered.

Three side notes: (1) The opinion relies heavily on online sources, including the results of Google searches and Wikipedia, as well as

(2) "This case is distinguishable from the Hershey case where the Board found a credible double entendre in the BIG PECKER mark based on the display of a chicken with a beak along with the BIG PECKER word mark in the specimen of record." Yeah. Right.

(3) Compare this item (paragraph 3) with this follow-up (paragraph 5).

Thanks to How Appealing for the pointer.


A Fascinating Story:

"Among all the Iraqis who aided American forces, few proved to be more valuable and fewer still risked as much as Faris Al-Baghdadi (his name has been changed ...)." The L.A. Weekly has his story.


Thursday, May 21, 2009

The Effects of the Credit Card Bill:

Odysseas Papadimitriou has an informative summary of the likely effects of the credit card bill on his "Wallet blog" at, both the costs and benefits:

In short the credit card legislation will significantly change the way credit card companies conduct business. Relative to the current landscape and once credit card companies reach full compliance under the new law, consumers will see smaller credit lines, higher interest rates, higher membership fees and fewer 0% offers. Rewards offers will likely stay the same.

While the effects of the legislation we’ve outlined here may seem wholly negative, we strongly believe that the long term effects will result in a net benefit for consumers. This landmark legislation eliminates “gotcha” rate hikes and fees and will allow consumers to plan the selection and management of personal credit lines, without the worry of unforeseen surprises popping up along the road.


Non-Ethanol Gas in the DC Area: This is sort of a weird question, especially on a legal blog, but do any readers know where a person can purchase non-ethanol gasoline in the greater DC area? Most pumps sell E10, a gas/ethanol 90/10 blend, and I'm curious if there are any pumps in the DC area (DC, MD, northern VA) that sell gasoline without any ethanol. Thanks in advance.

Reason Symposium on Picking a Replacement for Justice Souter:

Reason magazine just put up an on-line symposium asking various legal commentators to answer four questions about the upcoming Supreme Court appointment. The participants are mostly libertarian, but also include a few liberals and conservatives. I was one of those who took part. Here are my answers (limited by the format to three sentences each):

Who should Barack Obama nominate for the Supreme Court and why?

If it were up to me, I would pick my Volokh Conspiracy co-blogger, Georgetown law professor Randy Barnett. Randy is perhaps the leading scholar of the original meaning of the Constitution and a strong advocate for individual rights and limited government. He is also a former prosecutor and would bring a badly needed perspective to the issues addressed by the Court's extensive criminal law docket, matters that most of the other justices have little experience with.

Who will Obama nominate and why?

It will likely be one of three consensus front-runners: Elena Kagan, Sonia Sotomayor, and Diane Wood. If I had to guess, I would predict Kagan; she is younger than Wood, much more capable than Sotomayor, and would avoid any significant confirmation fight. Kagan would also be a reliable liberal vote, and (based on her record as dean of Harvard Law School) a skillful coalition-builder on the Court.

Obama says that his ideal Supreme Court justice would have the "empathy" to identify with society's downtrodden. Do you agree with his criteria?

No, the job of a Supreme Court justice is to apply the text and original meaning of the law irrespective of whether he "identifies" with the litigants or not. Even if judges should take policy consequences into account, "empathy" with individual litigants can easily blind them to the broader, systemic effects of their rulings. For example, upholding laws that violate constitutional property rights may help individual "downtrodden" litigants, but often actually hurts the poor overall by curtailing the availability of low-cost housing.

What issue(s) will dominate the court over the next three years and why?

It's very hard to predict, because much depends on which cases happen to make their way through the lower courts. However, it's safe to say that the Court will continue to have extensive business law, regulatory, and criminal law dockets. In terms of major constitutional issues, it's likely that the Obama administration's revisions of Bush's War on Terror policies will lead to various legal challenges, some of which will probably get to the Supremes.

Although there's no chance that Obama (or a Republican president, for that matter) would actually pick him, co-blogger Randy Barnett did get the vote of at least one other symposium participant, Glenn Reynolds of Instapundit fame. Sadly, our endorsement isn't likely to get Randy appointed to the Court anytime soon.

On a more positive note, I want to take this opportunity to slightly expand on my answer to the "empathy" question. In addition to the fact that it violates judges' duty to apply the law impartially, using empathy as a criterion for judicial decisionmaking is pernicious because people tend to empathize with those who are most like themselves on dimensions such as race, class, gender, religion, and ideology. Do we really want to encourage judges to engage in such favoritism? Political liberals might want to ponder the fact that even under a Democratic administration, the majority of judicial appointees are likely to be relatively affluent white males. Of course some degree of empathy-based bias is probably inevitable. But we should try to appoint judges who strive to minimize its influence, not those who will give it free rein.

UPDATE: Judging from some of the comments, I wasn't clear enough in making my point about empathy. Yes, it's true, Obama won't deliberately try to appoint judges who empathize most with relatively affluent white males. However, by seeking to appoint judges who empathize with "downtrodden" groups and will make decisions in part on that basis, he will necessarily weaken the judicial norm of impartiality between groups. Judges who empathize with other groups are unlikely to set those sympathies aside if they see Obama appointees giving free rein to their own empathy for the "downtrodden." Moreover, even under an Obama administration, there will be many relatively affluent white male judges appointed who empathize most with people of similar background; this will happen simply because relatively wealthy whites are still the majority of the legal establishment from which judicial appointees tend to be drawn. These people, too, might vote based on that empathy if the impartiality norm is weakened.

This argument assumes that Obama's emphasis on "empathy" is not purely rhetorical and that he really will pick judges in large part because of their tendency to use empathy as a decision-making criterion in important cases. Whether he actually does so remains to be seen.


Presidential Memo On Federal Preemption: I don't know what (if anything) it means in practice, but this seems interesting for those of us interested in federalism. A bit of context here.

Karl Rove:

In my previous post, I linked to something Karl Rove wrote. I'm no fan of Rove's, who I think was a disaster for liberty-minded Americans in many ways, but that won't stop me from citing him when his political commentary is relevant.

I forgot, however (but the comments reminded me), that to some liberal readers citing Karl Rove is like waiving a red hanky in front of a bull, no matter what the context. Of course, he's not the only one. I think the best therapy for this is total immersion, so here goes:


Repeat ten times.

Feel better now?

Justice Breyer Proposes Adding Voice for Article III Judiciary in President's Cabinet: The BLT reports about an idea voiced by Justice Breyer during a panel discussion today. Justice Breyer complained that the Supreme Court and lower court judges don't have enough "political clout," and that there should be steps taken to give the judiciary more influence over legislation related to the judiciary:
  Breyer argued that despite concerns about separation of powers, there should be “a person with political responsibility” in the Cabinet to express the judiciary’s viewpoint directly to the president. He compared the position to that of lord chancellor in England.
  Hinting at who might play that role, he said, “That is my secret reason for mentioning the Department of Justice every chance I get. Don’t tell anyone.”
  I assume turnabout is fair play, so Justice Breyer will let the President select one of his law clerks every year to make sure the Executive Branch gets a voice in the Breyer chambers? Seriously, though, I suppose it just goes to show that every branch of government thinks the world would be a better place if only it had more influence over the other two.

The decline of the universal jurisdiction statute.

Reports out today indicate that Spain is reconsidering its universal jurisdiction statute and may repeal or restrict it. A universal jurisdiction statute gives courts jurisdiction over international crimes that do not meet ordinary jurisdictional requirements—that is, do not take place on the state’s territory, or involve the state’s nationals as perpetrators or victims. Here is the WSJ:

But the investigations by the judges, who are independent from the executive and legislative branches, have become a growing headache for the Spanish government. The Chinese government warned Spain that bilateral relations could be damaged over the case regarding Tibet crackdowns. The Israeli government strongly criticized the investigation into its 2002 attack on a Hamas leader, which killed 14 other people. Israeli Prime Minister Benjamin Netanyahu said the case "makes a mockery out of international law."

The U.S. has publicly taken a softer line. Behind the scenes, however, U.S. officials have met with the Spanish government and its prosecutors to try to halt the two cases related to the U.S. prison camp, according to officials of both countries.

Critics say the National Court judges should focus on slimming down the backlog of domestic cases that sometimes stretch back more than a decade. Government prosecutors also say that cases involving events in far-flung countries have little chance of succeeding without cooperation from the government of the country where the events occurred.

So far, only one case involved a clear-cut win: In 2005, Judge Garzón secured the conviction of a former Argentine military officer, Adolfo Scilingo, for throwing drugged prisoners from planes.

The last point is worth pondering. These statutes have been around for quite some time. They are on the books of dozens of countries, which have duly adopted them in order to comply with international treaties, such as the Convention Against Torture, which obliges states to prosecute violations that occur anywhere in the world. Amnesty International has made much of these statutes, claiming on the basis of state practice that domestic prosecution of international crimes ion the basis of universal jurisdiction is an established principle of international law. But as AI itself concedes, prosecutions and convictions are as rare as hen’s teeth. States legislate but do not act. Restrictions in the statutes, plus in some cases political control over prosecution (which is otherwise unacceptable in inquisitorial systems), do the job. Where they do act, as Spain is learning, they run into trouble.

For an earlier post on universal jurisdiction statutes, which expressed skepticism that former Bush administration officials would be prosecuted under them, see here. I acknowledged that investigating judges in Spain are independent of political control and thus can do what they want, and this could cause trouble for vacationing ex-officials. But I was probably too cautious. It is becoming clear that governments are happy enough to enact universal jurisdiction statutes so as to make a show of keeping their treaty obligations—just as long as they don’t have to use them.


Here is Ken Anderson's take.


Bill of Federalism 2.0: After the voluminous response to my Wall Street Journal article calling for a Federalism Amendment, I began working on a Bill of Federalism consisting of ten amendments to restore a balance between state and federal power, as well as important aspects of the original meaning of the Constitution. I posted the initial draft of these amendments to elicit comments on Having read the hundreds of comments and suggestions, I have now published a significantly revised version of the Bill of Federalism, along with an explanation of each provision, on Here is the introduction to the proposals:
Lately some state legislatures have been considering so-called "sovereignty resolutions." Rather than pass strictly symbolic measures, however, I recommended--in an op-ed last month in The Wall Street Journal--that state legislatures exercise the power given them under Article V of the Constitution to petition Congress to call a convention to propose a "Federalism Amendment."

This idea clearly touched a chord among the public and elicited an outpouring of comments and suggestions, including here on Forbes. While many liked my original proposal, others wanted to see added provisions for balanced budgets, term limits and other constraints on federal power.

With this feedback in mind, I decided to draft a Bill of Federalism consisting of 10 amendments devised to restore the balance between state and federal power as well as the original meaning of the Constitution. By identifying 10 separate amendments, a coalition can be formed from people who support different constitutional reform measures that could not be combined into a single amendment. At the same time, opposition to any one provision cannot be used to sink the whole proposal.

The preamble makes explicit why such amendments are sorely needed and specifies that delegates are to be selected by procedures chosen by their state legislatures. The proposed amendments that follow are primarily designed to reverse Supreme Court rulings that have improperly expanded federal power.

At the same time, the Bill of Federalism was designed to ensure that current constitutional protections of civil rights would be preserved and strengthened.

Some fear that any amendments convention might exceed the limited purpose for which it was called. Under the Constitution, however, any amendments proposed by a convention would still need to obtain the approval of three-quarters of all the states.

And historically no convention has ever been convened because Congress, fearing a convention, itself proposed the particular amendments requested by the states before two-thirds of states had applied for a convention.

When the Equal Rights Amendment came close to final approval by the states, the Supreme Court rendered the ERA unnecessary by modifying the Court's treatment of sex discrimination. I fully expect that, should even a handful of states approve this proposal and submit it to Congress and to other states, it will markedly affect the terms of political debate.

It will become the rallying cry of Tea Parties and other citizen groups across the nation and, like the Contract with America, can provide an organizing document for candidates seeking state and federal office. Candidates to state legislatures can campaign on proposing it to Congress, and candidates for Congress can campaign on proposing it for approval by the states.

And I fully expect that the Supreme Court would try to forestall its adoption by moving toward the original meaning of the Constitution, which it is always free to do. After all, even without a Bill of Federalism, the federalism embodied in the written Constitution is still the Supreme Law of the Land.
You can read the entire proposal and explanation (as well as post comments) here.

PS: Here is a clip from my brief discussion of the Bill of Federalism with Andrew Napolitano who was guest-hosting the Glenn Beck show last night:

Don't Ask, Don't Tell, Don't Repeal, Don't Defend:

In today's WSJ, Brian Hughes, a former Army Ranger twice awarded the Commendation Medal, makes a powerful case for ending "Don't Ask, Don't Tell":

I was a line infantryman in the Army's Ranger regiment from 2000-04, earning a promotion to sergeant within three years. In that time, my platoon performed dozens of combat missions on the front lines. Our lives depended on complete mutual trust.

Several of my colleagues knew I was gay. We lived in the closest possible conditions. When there were showers, we showered together. When we were out overnight on the cold, bare mountains of Afghanistan, we slept huddled together for warmth. It should go without saying that there was nothing remotely sexual about these situations. We had uncomfortable experiences — we were at war, after all — but my buddies were never uncomfortable with me.

The reason I didn't come out to more of my comrades wasn't out of concern for morale. I was worried about losing my job.

Since "Don't Ask, Don't Tell" came into effect, some 13,000 service members have been fired for being gay. Thousands more decided against pursuing a full career in the military and let their contracts expire. Replacements can be recruited and trained — at a cost of more than $36 million per year — but each individual's institutional knowledge is lost, to the detriment of the unit and the mission. . . .

Straight and gay soldiers have been fighting side by side in Afghanistan, Iraq and beyond without incident. More than 20 of our closest allies have integrated gays into their ranks, including all of NATO except Turkey. American troops work and live with these forces without incident.

Here at home, every government service is integrated, including the paramilitary sections of the CIA that work hand in glove with the armed services. The presence of gays in these organizations is a nonissue. The idea that our soldiers, sailors, airmen and Marines would have any greater difficulty adjusting is an insult to their professionalism.

As a candidate, Barack Obama promised to repeal "Don't Ask, Don't Tell." As President, he has not lifted a finger to overturn the ban. This is disappointing. As Hughes notes, public opinion is strongly against the policy, and there is real reason to believe that, if anything, maintaining the exclusion on openly gay servicemen and women compromises our security and defense.

At the same time the Obama Administration has not taken any steps to reverse the policy, it is simultaneously neglecting to defend existing policy, as embodied in a federal statute, in court. As the WSJ reported earlier this week, the Administration failed to file a petition for certiorari to challenge a decision of the U.S. Court of Appeals for the Ninth Circuit that held the military's policy should be subjected to intermediate scrutiny. The decision prompted a vigorous dissent from denial of en banc, and could eventually result in the invalidation of the law. As Ed Whelan notes, last year the Justice Department argued that the Ninth Circuit's decision "creates an inter-circuit split, . . . a conflict with Supreme Court precedent, and an unworkable rule that cannot be implemented without disrupting the military." Now, however, the Solicitor General's office has decided not to file cert on the grounds that it's an interlocutory decision. So, as a consequence, the military will have to defend a policy that the Administration opposes under a more rigorous standard of review than may be warranted under current law (and leaves in place a highly contestable precedent that were certainly affect additional cases in the Ninth Circuit for some time).

It seems to me that the Obama Adminsitration has it wrong on both counts. The Administration should ask Congress to repeal the law. We don't need to lose any more Daniel Chois. But until the law is repealed — and I am assuming that the Administration cannot end the policy unilaterally through an administrative edict — the Justice Department has an obligation to defend the laws that are on the books, particularly where they concern the military. Perhaps the argument for leaving this "interlocutory" opinion in place is more powerful than I recognize, but I am skeptical. It seems to me the Administration is ducking a controversy, perhaps even hoping that the courts will do its dirty work to end the law. Our military and servicemen and women deserve better. Even if one opposes "Don't Ask, Don't Tell" — as I do — one should not want military personnel policy run by the courts.

UPDATE: Brian Hughes e-mails:

Prof. Adler: Thank you for featuring my article. There was some interesting and profitable discussion before the flame war broke out.

I would like to clarify one thing (column space in the WSJ is limited): I was not discharged under Don't Ask, Don't Tell. I served out my four-year contract and was honorably discharged when I chose not to re-enlist.

Aside from changing a pronoun here and there when my buddies and I would discuss our sex lives, DADT did not affect me nearly as much as it has others. I would not be speaking out against it if I were not firmly convinced that it is detrimental to our national security.

Note: Due to the aforementioned flame war, I closed the comments to this thread.


Libertarians and Obama:

Quite a few libertarians voted for Obama because he campaigned as a liberal on foreign policy and a moderate on economic policy, and they preferred that combination to what they deemed McCain's conservative foreign and marginally more conservative economic policy. For libertarians who lean "left" on foreign policy, Obama's rhetoric gave them hope that as president he would fundamentally reassess American foreign policy in the direction of nonintervention, and reverse various national security policies that they felt threatened individual liberty.

As Karl Rove points out, however, Obama has thus far turned out to be very liberal (statist would be a better adjective--bailouts of large corporations, political interference with bankruptcy law on behalf of special interests, going back on pledges to rein in earmarks, and so forth, can hardly be deemed "liberal" either philosophically or in their redistributive consequences) on economic policy, and not much different than the Republicans on a variety of national security and foreign policy issues. In other words, libertarian Obama supporters got the opposite of what they hoped for: a moderate on foreign and national security policy, and someone fundamentally reassessing American economic policy in the direction of bigger government.

I wonder how many libertarian fans Obama has left?

(As is becoming my standard practice, comments will be open for a limited time.)


[Peter Leeson, guest-blogging, May 21, 2009 at 8:38am] Trackbacks
Somali Pirates: Avengers of Social Justice?

An increasingly common claim to hear is that the Somali pirates are just attempting to right the wrongs of greedy multinationals and others who, since Somalia’s government collapsed in 1991, have taken advantage of the country’s statelessness to dump toxic waste and exploit the resources in its coastal waters.

Somehow, capturing vulnerable commercial vessels traveling through Somalia’s water lanes, holding their crews hostage for weeks at a time, and then ransoming them for money is supposed to punish(?) or deter(?) this behavior. Recognition of the Somali pirates’ socially conscious motivations isn’t meant to justify their actions, it’s said--merely to help us better understand what causes people to turn to piracy in the first place, presumably so that we can prevent it.

I’ve been asked several times what I think of this claim. My answer: I don’t buy it.

Like their 18th-century predecessors, the Somali pirates are businessmen. As I think their basic MO--capture ships; hold sailors hostage; ransom for wads of cash; buy BMW--pretty clearly evidences, they’re in it for the money. And as far as I know, the pirates haven’t donated any of the estimated $30 million+ they managed to steal last year to Greenpeace or environmental organizations for the cleanup of their polluted coastal waters.

So where does the image of Somali pirates as avengers of social justice come from?

From Somali pirates, of course. The Somali pirates see a benefit of presenting themselves this way. And with good reason. Their claim has been repeated enough in popular media to lead at least some to start asking whether it might be true. Transforming anger into sympathy isn’t a bad strategy for Somali sea dogs.

If the idea of a pirate PR scheme sounds far fetched to you, consider its historical precedent. As I discuss in The Invisible Hook, early 18th-century pirates were also keenly aware of their public persona and worked diligently to manipulate this image to their benefit.

For example, one of the problems early 18th-century pirates confronted in attempting to maximize profit “on the account” was recalcitrant captives who hid, and sometimes even destroyed, booty to prevent their pirate captors from getting a hold of it. Obviously, loot that pirate captives successfully hid or destroyed was loot that couldn’t contribute to pirates’ revenue. To prevent this behavior, pirates sought to establish a reputation as “men on the edge”--men who, if resisted in these or other ways, would launch into a torturous frenzy.

Pirates worked on developing this reputation in several ways. One was by inflicting barbarous punishments on sailors who didn’t immediately deliver up everything they had that the pirates wanted. I won’t go into detail about what these tortures here . . . Suffice it to say, none was as kind or as quick as “walking the plank.”

Another way pirates cultivated their image as “hair triggers” was by displaying and proclaiming “madness,” fearlessness of death, hatred of God, etc., in front of unwitting captives who were led to believe that their captors might really be from hell, as some pirates intimated they were.

Word of mouth helped spread and institutionalize pirates’ resulting reputation. But so did the early 18th-century media--newspapers that recounted captives’ accounts of piratical claims and deeds that they heard and observed while under their captors’ control. Since pirates were aware of such reporting, they also were aware that they could spin their public image to their advantage by acting out appropriately in front of the legitimate persons they interacted with. So, this is exactly what they did.

This strategy proved at least partly effective. In fact, to this day, popular perceptions of 18th-century pirates remain very much wedded to, and in important ways reflect, the public image pirates sought to project among their contemporaries as a means of facilitating compliance with their demands for the purpose of enhancing profit.

It remains to be seen what, if any, substantive effect the Somali pirates’ PR campaign--a campaign that aims to present them to the world as sea-borne Captain Planets--will have. This depends on how well such spin succeeds in duping those susceptible to the pirates’ message. But the early signs look positive for Somali pirates. Three of my last three interviewers asked me about the Somali pirate social justice angle, which means that, at a minimum, the pirates’ message is getting out there.


Dangers of DC Parking:

A couple weeks ago, the DC police gave me not one but two tickets for parking in an area where it is forbidden to do so from 9 AM to 1 PM. The only problem was that both tickets were issued between 11 PM and 1 AM according to the time-stamps on the tickets themselves. Fortunately, I had my digital camera with me and took photos of my car, as well as a nearby sign that clearly indicated that parking at the time I was there is legal. The fact that there were two separate tickets issued 90 minutes apart suggests that it may not have been a mere inadvertent error.

Normally, I wouldn't bother VC readers with this kind of personal gripe. However, economics blogger Megan McArdle reports that such shenanigans are part of a broader campaign by the DC government to increase ticket revenue:

At 7:30 this morning, far earlier than I normally leave my house, I was outside in flip-flops and my pajama shorts, moving my car. Nor was I the only one. My neighborhood is filled with students and people who work from home, and a whole lot of them seemed to be making U turns to park across the street.

Why was I doing this? The District of Columbia is trying to make up plummeting tax revenues by getting the money out of motorists, especially parking. It's using cameras to get 100% enforcement of the street cleaning parking rules, nearly doubling the cost of many parking tickets, and upping the bill on meters--it now costs $2 an hour to park in front of the Watergate, up from $1 last month. This is a twofer: raise more revenue from the meter, and from the parking ticket, because who carries around $4 in change on a regular basis?

Anecdotally, they've also upped the quota on parking enforcement, which used to be more of a sinecure; my mother reports that she now has three parking enforcement officers in her small neighborhood, constantly patrolling rather than (as they used to) sleeping in front of the Congressional cemetary. They've started ticketing her for being an "out of state car" persistently parked in the neighborhood. I got a ticket for having no front plate, something I didn't know was required. The district has even started ticketing people for parking in their own driveways. After their budget meeting, the city council announced plans to raise millions in new revenue by issuing an additional 200,000 tickets this year.

Urban development scholar Donald Shoup has shown that urban curbside parking spaces are often overused and misallocated because motorists don't have to pay for them. Thus, there may be an efficiency rationale for raising the price of public parking on DC streets. However, violating the law, charging people for parking in their own driveways, and trying to surprise drivers by suddenly ramping up enforcement in order to make a quick buck are not the right way to go about it. It's pretty obvious that DC is trying to use tickets as a cash cow rather than as a tool for incentivizing more efficient use of public spaces.

I sent in the photos along with a detailed written statement appealing the tickets to the DC DMV Adjudication Services. We'll see if the DC authorities have the common decency to withdraw these clearly illegal tickets. Better still, they should fine officials who issue illegal tickets rather than going after drivers who haven't broken any law. I am not optimistic that they will do either.


Thomas Sowell on Public Ignorance and the Financial Crisis:

The Reason website has an interview with economist Thomas Sowell about his forthcoming book on the financial crisis. Sowell makes several good points, including one about public ignorance of economics:

Reason: What do crisis like this, and public reaction, say about general public understanding of economics?

Sowell: I think in the U.S. and in most of the world the public understanding of economics is abysmal. But it’s one thing not to understand something. I don’t understand brain surgery. It’s another to want to form policies on things on which you are ignorant. I hear the wonderful phrase “I want to make a difference” when it comes to policy. I would be horrified if I wanted to make a difference in brain surgery. The only difference is more people would die on the operating table.

The only encouraging thing about public reaction to the crisis is that going by polls citizens seem to have more misgivings about some of these policies than politicians or the media. Still, though there have been studies that indicate the New Deal prolonged the Great Depression by years, what is also clear is it was enormously popular. FDR was elected four straight times, and more than once without ever having brought unemployment down to single digits. An economic disaster does not necessarily mean a political disaster. If we could raise the average level of understanding of economics to what [prominent 19th century economist] Alfred Marshall had in 1890, the vast majority of politicians would be voted out of office.

I would add that public policy would be greatly improved if the average voter understood what Adam Smith knew about economics when he published The Wealth of Nations back in 1776. Reinforcing one of Sowell's points, I discussed how some politically popular New Deal programs helped prolong the Depression here and here. As Sowell suggests, the interesting thing about these programs is not just that they had extremely harmful effects, but that their authors didn't suffer any political punishment as a result - in part because most voters lacked the economic knowledge to understand what was happening.


Wednesday, May 20, 2009

Political Ignorance and Blaming "the Jews" for the Economic Crisis:

Political scientists Neil Malhotra and Yotam Margalit have an article describing survey data showing that some 25% of [non-Jewish] Americans believe that "the Jews" deserve at least "a moderate amount" or "a great deal" of blame for the current economic crisis. Some 32% of self-identified Democrats and 18% of Republicans take that view. Similar results were obtained in a recent survey of opinion in several European nations.

I. Blaming the Jews as a Consequence of Rational Political Ignorance.

These figures are shocking, but not as surprising as they might seem. Previous surveys show that large percentages of the public endorse a variety of ridiculous conspiracy theories about political and economic events. As I explained in the post linked in the previous sentence, such beliefs are in large part the result of widespread "rational ignorance" about politics. Because any one vote has only an infinitesmal chance of affecting electoral outcomes, there is little incentive to spend time acquiring political information in order to become a better-informed voter; consequently, most citizens know very little about politics and public policy.

People who are ignorant about politics are more likely to endorse crude or simplistic explanations for political events. "The Jews did it" is a much simpler explanation for the financial crisis than a variety of complex policy errors that most voters don't know about and might not understand it if they did. Unfortunately, Malhotra and Margalit don't provide data correlating general political ignorance with belief in an anti-Semitic explanation for the crisis. However, they do note that blaming the Jews is inversely correlated with education; only 18% of respondents with bachelor's degrees blame the Jews at least a "moderate amount." By contrast, that view is held by 27% of respondents with lesser educational attainment. Obviously, education is highly correlated with political knowledge.

II. Blaming the Jews as a Form of "Rational Irrationality."

Simple ignorance is not, of course, the sole explanation for widespread belief in anti-Semitic explanations of the financial crisis. Also relevant is the fact that most people are highly biased in their evaluation of whatever political information they do know"rational irrationality." Thus, a person with preexisting anti-Semitic prejudices (perhaps a belief tha Jews have excessive influence over banking and finance) is likely to interpret whatever she hears about the financial crisis in light of those biases. A 2007 ADL survey conducted before the current crisis found that 18% of American gentiles believe that Jews have "too much control/influence on Wall Street" and 20% think that they have "too much power in the business world." These figures are comparable to the 25% who today blame the crisis in large part on the Jews, and suggest that many of those who blame the Jews do so in part because of preexisting anti-Semitic biases. Obviously, such biases are reinforced by simple ignorance. The less you know about economics and public policy, the less likely you are to be aware of more sophisticated explanations of the crisis, and the more likely you are to fall back on crude prejudices in trying to understand it.

III. Does it Matter?

Many readers probably assume that the answer to this question is obvious. If large numbers of people blame the Jews for the financial crisis, there might be an anti-Semitic backlash or even violence against Jews. In the US, however, there has been very little such backlash so far and anti-Semitism is largely absent from mainstream political discourse.

The more subtle and perhaps more important effect of these attitudes is in their impact on public opinion about how to respond to the crisis. If you believe that the crisis was in large part caused by the misdeeds of "the Jews," that is likely to affect your evaluation of how to respond to it. Malhotra and Margalit present some preliminary data suggesting such effects, finding that survey respondents reminded of Bernie Madoff's Jewishness are more likely to oppose corporate tax cuts to "create jobs" as a potential remedy for the recession. That finding, however, is likely to be just the tip of the iceberg of possible interactions between belief in anti-Semitic explanations for the crisis and beliefs about appropriate remedies.

Obviously, public opinion is not the only determinant of government policy. But it often does have a substantial impact. To the extent that opinion is significantly influenced by ridiculous conspiracy theories (anti-Semitic or otherwise), that impact is unlikely to be positive.

UPDATE: I should note that the survey results cited by Malhotra and Margalit count only gentiles, and did not include Jewish respondents. This has little effect on the data, since Jews are less than 2% of the American population. But it is perhaps worth pointing out.


Jay Nordlinger (at National Review Online)

praises my friend Ted Cruz, who is running for Texas Attorney General.


Indiana Files Objection in Chrysler:

Well at least one set of secured creditors is objecting in Chrysler: The state of Indiana on behalf of the Indiana State Teachers Retirement Fund and the Indiana State Police Pension Trust. The objection is available here.

The pleading indicates that the hearing date is May 27. Tom Lauria is one of the lawyers for the objectors.

I'm glad that this is going to at least be forced to be teed-up for a hearing and give Judge Gonzalez a crack at this thing. Obviously this makes it more difficult for the case to be resolved on the government's preferred timetable as well.

The state's press release is here.


The No on Koh Letter:

In April, I signed a joint letter to the Senate Foreign Relations Committee, raising concerns about the nomination Yale Law School Dean Harold Koh to be Legal Advisor to the U.S. Department of State. The No Koh website contains a detailed report on Koh, written by Ed Whelan of the Ethics & Public Policy Center. The website also contains videos, a blog, and a FAQ, although these are aimed more at a lay audience than at persons engaged with legal policy.

While I agree with most, although not necessarily all, of the points made on the No Koh website, my own view on Koh is based on reading six of his law review articles: A World Drowning in Guns, 71 Fordham Law Review 2333 (2003); Is International Law Really State Law? 111 Harvard Law Review 1824 (1998); On American Exceptionalism, 55 Stanford Law Review 1479 (2003); The 1998 Frankel Lecture: Bringing International Law Home, 35 Houston Law Review 623 (1998); International Law as Part of Our Law, 98 American Journal of International Law 43 (2004); Why Transnational Law Matters, 24 Penn State International Law Review 745 (2006).

Deah Koh is an excellent writer and an impressive scholar. But his legal vision is for a substantial diminution of the sovereignty of the American people, and as Legal Advisor to the State Department, he would have tremendous power to advance that vision. As Dean Koh has explained, his writings on transnationalism are not merely descriptive; they are also a strategy for activists. Of course Dean Koh has the right to advocate as sees fit. The Constitution, however, requires that major presidential appointees must earn the Advice and Consent of the United States Senate. The Senate's duty to be especially careful on Advice and Consent would seem to be at its apex when an appointee's record shows a long-standing determination to weaken the existing constitutional sovereignty of the United States of America.


On Chrysler's Chickens Coming Home to Roost:

In my WSJ column on Chrylser last week I asked:

Chrysler -- or more accurately, its unionized workers -- may be helped in the short run. But we need to ask how eager lenders will be to offer new credit to General Motors knowing that the value of their investment could be diminished or destroyed by government to enrich a politically favored union. We also need to ask how eager hedge funds will be to participate in the government's Public-Private Investment Program to purchase banks' troubled assets.

Bloomberg reports that hedge fund managers burned by Obama now are "wary":

May 20 (Bloomberg) -- Hedge fund manager George Schultze says he may avoid lending to any more unionized companies after being burned by President Barack Obama in Chrysler LLC’s bankruptcy.

Obama put Chrysler under court protection on April 30 after lenders balked at a proposal giving them about 29 cents on the dollar for their $6.9 billion in debt. The investors said the president’s plan favored a union retiree medical fund whose claims ranked behind them for repayment. It was offered a 55 percent equity stake in the automaker.

Pacific Investment Management Co., Barclays Capital and Fridson Investment Advisors have joined Schultze Asset Management LLC in saying lenders may be unwilling to back unionized companies with underfunded pension and medical obligations, such as airlines and auto-industry suppliers, because Chrysler’s creditors failed to block Obama’s move. The reluctance may put additional pressure on borrowers seeking capital in the worst financial crisis since the Great Depression.

“Lenders will have to figure out how to price this risk,” Schultze, 39, said in a telephone interview from his office in Purchase, New York. “The obvious one is: Don’t lend to a company with big legacy liabilities or demand a much higher rate of interest because you may be leapfrogged in a bankruptcy.”

Read the whole thing--there is plenty of interesting stuff in there.

Amicus Brief in Anna Nicole Smith Case:

Marcus Cole and I have been working on an article on the Anna Nicole Smith bankruptcy case and the negative incentives it creates for forum-shopping in bankruptcy. I'll be posting our working paper in the next few days.

In the meantime, Marcus, Ron Rotunda, Todd Brown, and I have filed a amicus brief in the case as to whether the issues that arose in the bankruptcy case are "core" or "non-core" matters. The brief is available on Ron's website here for those who are interested.


Oops, I forgot to list myself as a signatory on the amicus in the original post.

Jeff Rosen Hearts Diane Wood:

Jeff Rosen profiles Supreme Court short-lister Judge Diane Wood, and it's very favorable. (It also relies more on named sources than his profile of Judge Sotomayor.) His bottom line: "Her combination of moderate liberalism and a judicious temperament would make her a worthy successor to David Souter."

For what it's worth, I've long thought Judge Wood is the obvious choice. As I told Marcia Coyle:

She has a wide range of experience, including substantial government service; she has the intellectual heft to go toe-to-toe with the Court's conservatives; she is reliably liberal on the issues the administration and its base are likely to be most focused on (including abortion); she has experience that would seem to satisfy the president's concern for empathy, including being a working mother while on the faculty at the University of Chicago when they did not have maternity leave.
On a related note, Judge Wood is in Washington today.


Um, Talk About Trackbacks!

Take a look at this webpage, purporting to report on a posting of mine here on the VC. Here's how it starts:

David Post at the Volokh Conspiracy writes: Code’s a exceptionally momentous promulgate, in my purpose (and, I about, objectively speaking, in the purpose of melodious much actually interested in reasoning encompassing law and balance on the Net). Lessig got a kismet of things honourable in Code; most fundamentally, the inclination encompassing which much of the promulgate is organized - that “code is law” on the extensive network - is a exceptionally nonsensical bounteousness a certain, and still a downright a certain, and it has been utter to a queer blow the whistle on of exceptionally advantageous reasoning in the gift. Code got some things out of line, too - most fundamentally, when Lessig argued that it is abortive (and maybe still dangerous) to talk encompassing cyberspace’s “nature.”

[The actual original posting is here] It's pretty bizarre -- as best I can figure it, somebody took my original posting and ran it through some sort of nonsense-generator to produce the text shown there -- it's English, and it bears some relationship to my original posting, but it makes absolutely no sense. [along the lines of Noam Chomsky's famous sentence "Colorless green ideas sleep furiously," designed to illustrate sentences that can be perfect grammatically but semantically nonsensical]. Surprisingly enjoyable to read, actually . . .

As to why someone might want to do this, I'm less clear. And inasmuch as this is a legal blog, one might raise the question: is there a cause of action here? For "false attribution" under the Lanham Act, perhaps? False light publicity? [No, I'm not thinking of suing, or even complaining about it, though it is something of a shock to see something like this attributed to you on the Net; I assume that anyone who stumbles across this would realize pretty quickly that whoever this "David Post" might be, he surely didn't write this . . .]


Time for Republicans to Get Tough?

Ed Gillespie argues that it's time for Republican Senators to adopt a less deferential approach to judicial nominations.

In leading the White House efforts to confirm Roberts and serving as a "sherpa" for Alito's confirmation, I argued strongly along with many Senate Republicans that Democrats would be mistaken to change the historic standard for confirmation to the nation's highest court. Since they did, however, those same Senate Republicans would be mistaken if they didn't apply that same standard to President Obama's nominee.

Republicans cannot accept the premise that it's okay for liberals to vote against Supreme Court nominees who believe in a strict constructionist judicial philosophy but not okay for conservatives to vote against those who embrace empathetic activism on the bench.

The encroachment on executive prerogative is unfortunate, and its polarizing effect is unhealthy. But the shift in the balance of power from the presidency to Congress inherent in this approach is less troublesome than the inevitable leftward shift of our highest court if Republicans maintain the traditional standard while Democrats deploy an ideological one.

I understand this view, even as I lament it. I continue to believe the Senate should maintain a more deferential approach -- much like Senate Republicans adopted toward Ruth Bader Ginsburg and Stephen Breyer. I also fear there may be no going back. If Senate Republicans follow Gillespie's advice -- and Gillespie is hardly the only one urging this course -- I hope they will also promise to restore the status quo ante if Senate Democrats will commit to follow suit.


Are We Losing Legalities?

So the other night I notice that the RSS feed for Jan Crawford Greenburg's "Legalities" was pulling in all sorts of other stuff. What gives? Well, according to this post, Legalities (and several other blogs hosted by ABC News) are being folded into something called "The World Newser," a generic ABC World News blog. This is terribly unfortunate -- and quite poorly timed.

For those of us who follow the Supreme Court, Greenburg is indispensable. Her book, Supreme Conflict, was great (as Orin, Todd, and Ilya agreed). As Ilya noted, "Greenburg has a solid understanding of both conservative and liberal legal thought and she uses it to good effect in trying to understand what the Court has done in the era of Rehnquist and Roberts." Since news of Souter's retirement leaked, Greenburg has continued to break tidbits about the search for his replacement.

So why would ABC News fold Legalities into a generic news blog on the eve of a Supreme Court nomination, just when interest in a legal news blogs would peak? Beats me. The only explanation offered on the World Newser is that it's an effort "to make it easier for everyone -- one stop shopping." What they seem to miss, however, is that the focused content of Legalities -- like that of many other blogs -- was a feature, not a bug. I have no interest in wading through posts about Afghanistan's "summer fighting season" and "What Happens When Telemarketers Barrage A Reporter's Home?" in the vain hope I'll find a valuable Greenburg nugget. And judging from the early comments here, I am not alone.

Perhaps not all is lost. As of this morning, the Legalities page is still operating, even if the feed has been folded into the World Newser. Perhaps there's time for the brass at ABC to reconsider.


[Peter Leeson, guest-blogging, May 20, 2009 at 7:59am] Trackbacks
A Preposterous Suggestion: Of TJ, Pirates, and America's Founding

In the course of doing interviews on The Invisible Hook over the last several weeks I’ve had a number of people ask me if I thought America’s Founding Fathers might have been influenced by early 18th-century pirates in framing the United States government.

Before you laugh, let me explain . . .

In the book I analyze early 18th-century pirates’ system of social organization, the basic principles of which are, in several important respects, I suggest quite similar to those of our own.

The centerpiece of pirate governance was a system of constitutional democracy. Before launching a plundering expedition, each crew drew up a written document that stipulated the rules that would govern its members while the pirates remained together. These “articles” also empowered the chief pirate officer--the quartermaster--to enforce the rules, administer proscribed punishments, divide the booty, and so forth. Critically, by making many of these terms explicit, pirate constitutions not only empowered the quartermaster in these duties but also constrained him. He was not free divide plunder anyway he saw fit, for example, arbitrarily bestow social insurance payments on pirates he liked (pirates had an early system of workers' comp), or punish lawbreakers willy-nilly.

In addition to such “constitutional checks” on the quartermaster, pirates also exerted democratic checks on his behavior. Pirates popularly elected the quartermaster and could, and did, democratically remove quartermasters who overstepped their bounds or otherwise acted in ways at odds with the other crewmembers’ interest.

The quartermaster also exercised his authority within the context of a system of piratical separation of powers. While the quartermaster wielded command in cases such as those described above, he wielded no command in times of conflict with potential prizes. Authority in these cases fell to the captain, the other central pirate officer, who pirates also democratically elected and deposed. Notably, pirates’ democratic mechanism for this and other purposes was also established in their constitutions.

The chief pirate officers--the captain and quartermaster--not only had countervailing authorities, they also competed with one another. When pirates deposed an ineffective or otherwise unsuitable captain from command, they could, and sometimes did, elect the quartermaster to this post in his place.

Further, in some cases pirate crewmembers exercised a kind of “judicial review” authority. Where their articles were unclear or silent on certain matters, pirates gathered to interpret and apply the ship’s constitution to the case at hand.

Many of the fundamental features of pirate’s governance system should sound familiar to those acquainted with America’s governance system. They’re not the same, of course. But several of the basic institutions appear to be there, albeit in more rudimentary form.

Perhaps even more strikingly, the basic reason behind pirates’ system of checks and balances is fundamentally the same reasoning behind our system of checks of balances: to simultaneously empower and constrain those we endow with the authority to rule over us.

To keep their criminal enterprise from breaking down, pirates needed “leaders” who could maintain order among them and make certain decisions on behalf of the whole (such as during battle), but could also be prevented from abusing the power crewmembers vested in their hands for this purpose. Pirates were especially wary of this possibility, most of them having formerly sailed as legitimate sailors under the autocratic, and thus often abused, authority of merchant ship captains.

As one pirate put it, “Most of them having suffered formerly from the ill-treatment of Officers, provided thus carefully against any such Evil now they had the choice in themselves . . . for the due Execution thereof they constituted other Officers besides the Captain; so very industrious were they to avoid putting too much Power into the hands of one Man.”

Pirates confronted essentially the same dilemma in setting up their system of governance that James Madison famously described in Federalist 51. As Madison put it, “But what is government itself but the greatest of all reflections on human nature? If men were angels, no government would be necessary. If angels were to govern men, neither external nor internal controls on government would be necessary. In framing a government which is to be administered by men over men, the great difficulty lies in this: you must first enable the government to control the governed; and in the next place oblige it to control itself.”

Madison’s solution to this dilemma was constitutional democracy. “A dependence on the people,” Madison argued, “is no doubt, the primary control on the government.” “[B]ut,” he continued, “experience has taught mankind the necessity of auxiliary precautions.” “[T]he constant aim is to divide and arrange several offices in such a manner as that each may be a check on the other—that the private interest of every individual may be a sentinel over the public rights.”

This was pirates’ solution as well--but they forged it more than half a century before Madison put pen to paper. Pirates, of course, weren’t the first to invoke this solution. And there’s good reason to think that some of the legitimate world’s early experiences with democracy, separated powers, and so on, may have influenced pirates’ system of governance.

But could the direction of influence have also run the other direction? This is the question I began with. And while, unsurprisingly, I’ve yet to come across direct evidence that any of our Founding Fathers looked to pirate governance in forging America’s system of government, it might be too hasty to totally dismiss this suggestion as well.

I did a quick look to see if there might be any evidence that any of the Founders were even aware of pirates’ governance regime . . . .

And there is. Thomas Jefferson owned a copy of both of the two most important late 17th-century and early 18th-century books that describe pirate governance, Alexander Exquemelin’s Buccaneers of America, and Captain Charles Johnson’s General History of the Pyrates.

Does this prove that pirates’ constitutional democracy influenced Jefferson? Of course not. For one thing, Jefferson had many books in his personal library. That doesn’t mean all of them played a role in his thinking about American government. Further, I don’t know when Jefferson acquired these books. His copies were published (in 1774) before the Declaration of Independence; but that doesn’t tell us when Jefferson bought or read them.

But, at least in principle, it does suggest TJ could have “had a little captain in him.” The mere prospect is tantalizing enough for me . . .


Remembering the Attitude of the Times: Fannie Mae, 1993.

In the course of Steven Malanga's history of government policy promoting home ownership, he describes the milieu in the early to mid-1990s. Here is a nice example I found from the May 28, 1993 Washington Times:

Low-income homebuyers, especially blacks, Latinos and other minorities, are being wooed in an unusual ad campaign started this week in the Washington and Baltimore areas.

Called "Opening Doors to a Home of Your Own," the multimedia advertising blitz runs through the July Fourth weekend and is the work of the Federal National Mortgage Association (Fannie Mae).

The first organization listed as offering services in the brochure is the ACORN Housing Association.

Many of 45 area mortgage lenders and 35 local nonprofit counseling agencies are offering bilingual support for what the company anticipates could be as many as 100,000 calls from low-income potential home buyers in the region.

Specifically targeted are home buyers earning less than $59,200, the median family income in the Washington area. Half of the area's 4 million people make less than that amount, and there are more white families in that category than minorities.

But because proportionately more of the 1.5 million black, Latino and other minorities are in even lower income brackets, Fannie Mae sees the program as "positive outreach" into a community "too long ignored by mortgage lenders."

"We're not fooling ourselves," James A. Johnson, Fannie Mae chairman and chief executive officer, said at a press conference last week to announce the program. Speaking at the firm's Washington headquarters, the former Walter Mondale staff assistant cautioned, "The program can't be all things to all people.

"I believe there is discrimination in the housing industry," he told reporters, and that minorities are denied home mortgage loans "simply because of who they are."

"Any time we see it," Mr. Johnson said, "we're going to do everything we can to end it."

One lender taking up the offer to participate was American Home Funding of Richmond, which placed 22,000 mortgage loans last year totaling $2.4 billion. It has 600 employees.

Paul Reid, president and chief executive officer of American Home, said, "We can't say enough" about the new program. American Home sold mortgages totaling $40 million last year to minority and low-income homebuyers, Mr. Reid said, "and we're convinced that programs like this are the way of the future in real estate."

In fact, he said American Home recently began recruiting at historically black colleges and other universities to hire new minority staffers to join 300 loan officers throughout the area, including a bilingual staff at its Annandale branch. . . .

Under laws enacted last year, lenders convicted of discriminating against blacks, Latinos, women and others will lose access to the secondary mortgage market, [Laura Duenes of Citibank] observed. "Until now, we've never seen mortgage lenders, their staffs, or Realtors, brokers or anyone else dealing in real estate who discriminates against minorities suffer any penalty.

"Now they will," Ms. Duenes said, "and it's about time."

Part of the rush to embrace minorities and low-income people "is directly a result of that legislation," observed Chris Lewis, director of bank and housing policy at the Consumer Federation of America (CFA).

Congress acted last year to codify federal obligations to Fannie Mae and the Federal Home Mortgage Corp. (Freddie Mac), both of which were chartered by Congress but now operate independently. In so doing, he said, "The legislation forced the secondary market to either help minorities or lose its federal backing."

CFA, an advocacy umbrella group of 240 organizations representing nearly 50 million persons, closely monitors the housing market, Mr. Lewis said. . . .

The sixth-largest corporation in America, Fannie Mae last year financed 3 million home loans valued at more than $250 billion.

"The question," Mr. Lewis said, "is why are taxpayers subsidizing giant corporations that discriminate against American taxpayers?"

CFA strongly supported Congressional mandates requiring that by 1994 mortgage lenders target at least 30 percent of their business to minorities and poorer home buyers.

The legislation "could work a revolution of sorts" in the way poorer people and minorities are treated by the real estate world, he said.

Lenders now must track mortgage business by a borrower's race, ethnicity, geographic location and other variables. By August, the Department of Housing and Urban Development will report to the nation on the performance of all mortgage lenders.

"That's when the mortgage community will have to face a new reality," he said. Banks not reaching the 30 percent requirement could find themselves losing federal backing in the secondary market in 1994, "a possibility that has the mortgage-financing world on the brink of something we've really not seen before in this country." . . .

Not surprisingly, when the crisis hit, Citibank was perhaps the most insolvent of the mega-commercial banks. And American Home, the organization so thrilled with the new program went out of business in the first big week of the credit crisis, on August 2, 2007. Fannie Mae had to be nationalized last year.

Related Posts (on one page):

  1. Remembering the Attitude of the Times: Fannie Mae, 1993.
  2. Obsessive Housing Disorder, Government Efforts to Increase Home Ownership.

Obsessive Housing Disorder, Government Efforts to Increase Home Ownership.

In the City Journal, Steven Malanga has the best history of the government's destructive attempts to promote home ownership I've read, starting with Herbert Hoover in 1922 and continuing through the current efforts to keep home prices from dropping to market-clearing prices.

He covers a lot that I hadn't known much about from the 1920s through the 1960s.

When Malanga moves to the 1980s and 1990s, he moves onto more familiar ground:

The next stop on the road to 2008 was a fateful campaign to lower lending criteria, which, the housing advocates argued, were racist and had to change. The campaign began in 1986, when the Association of Community Organizations for Reform Now (Acorn) threatened to oppose an acquisition by a southern bank, Louisiana Bancshares, until it agreed to new “flexible credit and underwriting standards” for minority borrowers—for example, counting public assistance and food stamps as income. The next year, Acorn led a coalition of advocacy groups calling for industry-wide changes in lending standards. Among the demanded reforms were the easing of minimum down-payment requirements and of the requirement that borrowers have enough cash at a closing to cover two to three months of mortgage payments (research had shown that lack of money in hand was a big reason some mortgages failed quickly).

The advocates also attacked Fannie Mae, the giant quasi-government agency that bought loans from banks in order to allow them to make new loans. Its underwriters were “strictly by-the-book interpreters” of lending standards and turned down purchases of unconventional loans, charged Acorn. The pressure eventually paid off. In 1992, Congress passed legislation requiring Fannie Mae and the similar Freddie Mac to devote 30 percent of their loan purchases to mortgages for low- and moderate-income borrowers.

The campaign gained further traction with the election of Bill Clinton, whose housing secretary, Henry Cisneros, declared that he would expand homeownership among lower- and lower-middle-income renters. His strategy: pushing for no-down-payment loans; expanding the size of mortgages that the government would insure against losses; and using the CRA and other lending laws to direct more private money into low-income programs. Shortly after Cisneros announced his plan, Fannie Mae and Freddie Mac agreed to begin buying loans under new, looser guidelines. Freddie Mac, for instance, started approving low-income buyers with bad credit histories or none at all, so long as they were current on rent and utilities payments. Freddie Mac also said that it would begin counting income from seasonal jobs and public assistance toward its income minimum, despite the FHA disaster of the sixties.

To meet their goals, the two mortgage giants enlisted large lenders—including nonbanks, which weren’t covered by the CRA—into the effort. Freddie Mac began an “alternative qualifying” program with the Sears Mortgage Corporation that let a borrower qualify for a loan with a monthly payment as high as 50 percent of his income, at a time when most private mortgage companies wouldn’t exceed 33 percent. The program also allowed borrowers with bad credit to get mortgages if they took credit-counseling classes administered by Acorn and other nonprofits. Subsequent research would show that such classes have little impact on default rates.

Pressuring nonbank lenders to make more loans to poor minorities didn’t stop with Sears. If it didn’t happen, Clinton officials warned, they’d seek to extend CRA regulations to all mortgage makers. In Congress, Representative Maxine Waters called financial firms not covered by the CRA “among the most egregious redliners.” To rebuff the criticism, the Mortgage Bankers Association (MBA) shocked the financial world by signing a 1994 agreement with the Department of Housing and Urban Development (HUD), pledging to increase lending to minorities and join in new efforts to rewrite lending standards. The first MBA member to sign up: Countrywide Financial, the mortgage firm that would be at the core of the subprime meltdown.

The article doesn't mention Barack Obama's direct involvement as one of the chief lawyers in the crusade in Chicago to lower lending standards in the 1990s. Yet in 2001, Obama was also one of the leaders in Illinois in attacking predatory lending, by increasing disclosures, outlawing some deceptive practices, and prohibiting certain kinds of fees for state-chartered lenders.

Of the seven court opinions on Westlaw from the 1990s in which Barack Obama was a lawyer, the first was a racial redistricting case and the second was a slander-employee termination case, both from 1994. In three additional opinions, Obama represented ACORN suing the state government to implement the motor-voter statute.

The last two opinions were in a big 1994 class action, Buycks-Roberson v. Citibank Federal Sav. Bank, designed to get Citibank to lower its lending standards in minority neighborhoods because they were alleged to be discriminatory. Although ACORN was not mentioned by name in the case, the target, Citibank, was one of ACORN's main ones in that era, when ACORD was pushing for easier lending standards for minorities in Chicago and elsewhere. And the 1998 settlement provided that Citibank must pay for lending counseling of the kind that ACORN was doing in Chicago and other cities at the time. Barack's firm (who had two other lawyers on the case along with Barack) shared in the $950,000 in plaintiffs' attorneys' fees that Citibank had to pay.

After several years of ACORN's efforts (and the influence of the Buycks-Roberson class action), "in 1999, 4,958 foreclosures were started by subprime lenders in Chicagoland; up from 131 in 1993 . . . In Springfield, the number of foreclosures rose dramatically from three in 1993 to 150 in 1999." Chicago Tribune, April 17, 2001.

Related Posts (on one page):

  1. Remembering the Attitude of the Times: Fannie Mae, 1993.
  2. Obsessive Housing Disorder, Government Efforts to Increase Home Ownership.

Tuesday, May 19, 2009

Toobin on Chief Justice Roberts:

Jeffrey Toobin has a lengthy profile of Roberts in The New Yorker. Despite all the verbiage, however, and despite the fact that I'm hardly a Roberts groupie, I don't think I learned anything new from this piece [Roberts is (gasp!) a conservative! Liberals like Toobin don't like conservatives, and interpret their views uncharitably!]. Recommended only if you've never read a reasonably long profile of Roberts.


FCC v. Fox Television Stations, Part IV: The FCC's new standards in action.

This is part of a series of posts discussing the background of the Supreme Court's "fleeting expletives" case from last week, FCC v. Fox Television Stations. Click here to see the whole string of posts, including this one, on a single page, in chronological order. (As usual, click here to watch George Carlin's monologue if you haven't done so already!)

In the last post, I discussed the FCC's 2004 rule on indecency, which altered its previous policy, mainly on the word "fuck." For something to be indecent, it has to, first, refer to sexual or excretory activities. And, second, it has to be patently offensive, in context, according to contemporary community standards. This second prong (heh-heh) involves analyzing (1) the explicitness or graphic nature of the description of sexual or excretory activities, (2) whether the material dwells on or repeats the description of these activities at length, and (3) whether it appears to pander or titillate or was presented for its shock value.

On the first prong, the FCC found that "fuck," in any form, always referred to sexual activities. And on the second prong, the FCC applied its three criteria and determined that its use on a nationally televised awards show was indeed patently offensive. (As an alternative ground, the FCC held that "fuck" was profane, another prohibited category.) Therefore, the material was "indecent," and thus banned by the statute, even if it was only mentioned once and accidentally. (The previous policy had announced that isolated occurrences were of no regulatory concern.) Nonetheless, the FCC declined to assess a fine, because it was announcing a change of policy and thought the regulated community ought to have more notice before being fined — among other reasons, lest there be a chilling effect on speech.

That was the 2004 policy. About two years later, in March 2006, to give greater guidance to the regulated community, the FCC released a lengthy document analyzing dozens of particular cases, representing thousands of complaints. The document was divided into three parts: (1) cases where it found indecency or profanity and proposed monetary fines against the licensees, (2) cases where it found indecency or profanity but didn't propose fines, and (3) cases where it didn't find indecency or profanity. Here are some examples — I'll focus on the ones involving speech rather than visual depictions of sex.


The Seven-Per-Cent Solution:

Typecasting in the new Sherlock Holmes movie?


Ninth Circuit Judge Calls for En Banc Review in Ninth Circuit's Second Amendment Gun Show Case:

The parties have been asked to file briefs within 21 days of yesterday on whether en banc review is warranted. After that, it would take a majority vote of all 27 active Ninth Circuit judges to vacate the panel decision, and thus cause a rehearing by a 11-judge subset of the Ninth Circuit (Chief Judge Alex Kozinski plus ten randomly drawn judges).

Unless I'm mistaken, the en banc review procedure in the Ninth Circuit is all or nothing: Though there are two conceptually separable issues in the case -- whether the Second Amendment is incorporated against state and local governments (on which the gun shows won), and whether under the Second Amendment governments may ban guns in county fairgrounds (on which the gun shows lost) -- a judge can't vote for en banc review of only one of the issues.

I tentatively stand by my prediction from last month as to the likelihood of en banc review:

I expect that rehearing en banc isn't very likely. First, such en banc review is always hard to get. Second, here at least two of the Democrat-appointed judges — Pregerson and Gould — have expressed their views that the right to bear arms should indeed be incorporated, Gould both here and in the Silveira v. Lockyer case, and Pregerson in Silveira. (Two other Democrat-appointed judges, Reinhardt and Fisher, stated in Silveira that "One point about which we are in agreement with the Fifth Circuit is that Cruikshank and Presser" — the cases often cited as rejecting incorporation of the Second Amendment — "rest on a principle that is now thoroughly discredited"; but those judges also took the view that the Second Amendment only secured a collective right, and it's not clear whether they would reconsider their position now, following Heller.) Three Republican-appointed judges, Kozinski, O'Scannlain, and Kleinfeld, are likewise on the record as supporting incorporation.

For there to be a majority — 14 of the 27 active judges — for taking the case en banc, all of the 16 Democrat-appointed Ninth Circuit judges other than Pregerson and Gould would have to vote for en banc, or each Democrat-appointed defector would have to be balanced by a Republican-appointed vote for en banc. That's not impossible; some conservatives do indeed support gun controls, just as some liberals support gun rights. But it doesn't seem very likely. (Judge Alarcon, as a senior judge, can't vote on the en banc.)

The Ninth Circuit doesn't reveal the identities of judges who call for en banc, or the identities of those who vote for or against en banc (except insofar as they may identifying themselves in any written opinions dissenting from the denial of en banc or supporting the denial of en banc).


Is Bill O'Reilly Bad for Tenure?

A Syracuse University management professor thinks so. Paul Caron has a round up here.

Journal on Firearms & Public Policy:

The Journal on Firearms & Public Policy, published by the Second Amendment Foundation, is an annual interdisciplinary journal. It publishes a mix of original articles, and reprints of important articles published elsewhere. Among the the authors of original articles who may be best-known to VC readers are Gary Kleck, James Jacobs, Roy Wortman, Gary Mauser, Clayton Cramer, Andrew McClurg, and David Beito.

I am happy to announce that 14 of the 20 volumes are now available on-line, with most of the remainder coming soon.

If you are interested in submitting an article (or a query) to the JFPP, just send me an e-mail via the contact on the lower-right column of my home page.


The Case Against the Libertarian Case Against Hispanic Immigration:

Economist Bryan Caplan, my George Mason colleague, has an excellent post taking apart the most important argument offered by those libertarians who oppose Hispanic immigration to the United States: the claim that it will result in an expanded welfare state because Hispanics tend to vote Democratic. Bryan rightly points out that the voting tendencies of Hispanics are not cast in stone, that any statism-promoting effects of Hispanic migration are likely to be offset by increased opposition to the welfare state by native-born citizens (because social science data show that people are less supportive of the welfare state if they think the benefits are going to members of a different ethnic group), and that any libertarian harm resulting from Hispanic immigration is vastly outweighed by the much greater injustices resulting from immigration restriction. He also chides anti-immigration libertarians for ignoring the enormous harm restrictionist policies inflict on current and would-be migrants. As libertarians, we have no justification for excluding these from consideration merely because they happen not to be US citizens. Moreover, as philosopher Michael Huemer demonstrates, immigration restrictions are severe impositions on precisely the kind of "negative" freedom that libertarians most value. Libertarians are not nationalists or ethnic chauvinists, and must weight the freedom of all equally:

Almost 70% of American voters under the age of 30 voted for Obama. Why isn't anyone calling for the deportation of America's youth, or limits on fertility to raise our average age? The reason, presumably, is that people realize that this would be a grotesque over-reaction. Even if young voters are making America a little more socialist, the "cure" of mass exile is far worse than the disease. Libertarians should view arguments against Hispanic immigration in exactly the same way . . .

In fact, the moral imbalance is shocking. On the one hand, we have some libertarians fretting about the vague possibility that Hispanics might moderately increase the size of the welfare state. On the other hand, we have millions of Hispanics worrying that they might get deported back to the Third World, and tens of millions more languishing in dire poverty in their home countries when American employers would be happy to hire them. If anyone is "more sinned against than sinning," it is the maligned Hispanic immigrant. Shouldn't libertarians be standing up for him, instead of respectfully weighing flimsy excuses for his continued persecution?

I would add two points to Bryan's analysis. First, even if potential Hispanic support for the Democrats were a more serious danger than he allows, the better libertarian solution is not to restrict Hispanic migration, but to accept more immigrants that are likely to vote Republican and oppose welfare statism: people from countries like Cuba, Georgia, Poland, Russia, and Vietnam.

Second, Bryan's co-blogger Arnold Kling worries that Hispanic migration might create a "one-party state" in the US because "ethnic bloc voting" will make it impossible for the Republicans to woo this group successfully. There are many problems with this argument. But one big one is that the Hispanic vote is not and has never been monolithic. George W. Bush won about 35% of the Hispanic vote in 2000 and 40% in 2004, two very close elections. Even in 2008, a terrible year for the party that got saddled with the blame for the economic crisis, John McCain managed to get 31%. These figures represent a big edge for the Democrats. But they certainly fall well short of monolithic bloc voting. In the 1970s and 80s, the Republicans learned to successfully compete for the votes of Catholics and "white ethnics," groups that were once overwhelmingly Democratic. There is no reason why the Republicans can't be equally effective in wooing Hispanics.


Tenth Circuit Survey, Second Amendment, Habeas:

The Denver University Law Review's annual Tenth Circuit Survey is now on-line, in full text. The Survey is issue 3 of volume 86--below the tables of contents for issues 1 and 2, and the special issue on Obama.

The Tenth Circuit Survey issue includes my article, The Second Amendment in the Tenth Circuit: Three Decades of (mostly) Harmless Error.

One article in the issue which is not about the Tenth Circuit is Back to Basics: Habeas Corpus Procedures and Long-Term Executive Detention, by Marc Falkoff. He surveys the historical development of habeas, and argues that habeas has developed in a dialect between the judiciary and the other branches, and that an essential part of the dialect has been the judiciary's willingness to push back against executive or legislative attempts to constrict habeas. In the context of the Guantanamo detentions, he urges the judiciary to take a more assertive stance for more robust habeas.


Does Jack Goldsmith Prefer Barack Obama to Dick Cheney?

Harvard law professor Jack Goldsmith, who briefly headed the Office of Legal Counsel in the Bush Administration, has an interesting essay in The New Republic, "The Cheney Fallacy," suggesting that the Obama Administration's approach to counterterrorism is better than that adopted under President Bush. The article begins:

Former Vice President Cheney says that President Obama's reversal of Bush-era terrorism policies endangers American security. The Obama administration, he charges, has "moved to take down a lot of those policies we put in place that kept the nation safe for nearly eight years from a follow-on terrorist attack like 9/11." Many people think Cheney is scare-mongering and owes President Obama his support or at least his silence. But there is a different problem with Cheney's criticisms: his premise that the Obama administration has reversed Bush-era policies is largely wrong. The truth is closer to the opposite: The new administration has copied most of the Bush program, has expanded some of it, and has narrowed only a bit. Almost all of the Obama changes have been at the level of packaging, argumentation, symbol, and rhetoric. This does not mean that the Obama changes are unimportant. Packaging, argumentation, symbol, and rhetoric, it turns out, are vitally important to the legitimacy of terrorism policies.

After reviewing the key policy areas, and the Obama Administration's revisions (many of which are marginal or largely cosmetic), Goldsmith concludes:

One can view these and many similar Obama administration efforts as attempts to save face while departing from campaign promises and supporter expectations. And no doubt there is an element of this in the Obama strategy. But the Obama strategy can also be seen, more charitably, as a prudent attempt to legitimate and thus strengthen the extraordinary powers that the president must exercise in the long war against Islamist terrorists. The president simply cannot exercise these powers over an indefinite period unless Congress and the courts support him. And they will not support him unless they think he is exercising his powers responsibly, under law, with real constraints, to address a real threat. The Obama strategy can thus be seen as an attempt to make the core Bush approach to terrorism politically and legally more palatable, and thus sustainable.

If this analysis is right, then the former vice president is wrong to say that the new president is dismantling the Bush approach to terrorism. President Obama has not changed much of substance from the late Bush practices, and the changes he has made, including changes in presentation, are designed to fortify the bulk of the Bush program for the long-run. Viewed this way, President Obama is in the process of strengthening the presidency to fight terrorism.

This analysis seems right to me. If the Obama campaign could be criticized for its blindness to the difficult trade-offs the Bush Administration sought to balance, the Bush Administration was too hard-line and unilateral for its own good. The Bush team often took good or necessary ideas too far and was unnecessarily dismissive of other branches and other opinions. Insofar as the Obama Administration is trimming the excesses of the Bush Administration's policies, and paying more attention to how our policies are perceived by friends and foes overseas, it seems to me they are setting the right course. There will be further bumps and misteps along the way, but at least we are heading in the right direction.

Related Posts (on one page):

  1. More Rights at Gitmo, Fewer Elsewhere?
  2. Does Jack Goldsmith Prefer Barack Obama to Dick Cheney?

More on the New Auto Emission & Efficiency Standards:

Today's Washington Post confirms what I suspected, the new automotive fuel efficiency standards to be announced today will double as national vehicle emission standards for carbon dioxide (which only makes sense, as controlling fuel economy limits carbon dioxide emissions and vice-versa). It also explains why the automakers would accept the deal: "clarity and predictability," along with a single national standard It will also raise the average price of new cars by several hundred dollars, some portion of which will be offset by fuel cost savings.

Under the compromise, the federal government would establish two sets of standards, one for mileage and one for tailpipe emissions of carbon dioxide.

The Transportation Department's National Highway Traffic Safety Administration would set the new fuel-economy standards, which would raise the average fuel efficiency of a new car by 30 percent. Cars, for instance, would need to average 39 miles per gallon by 2016, while light trucks would need to reach 30 mpg.

The EPA, using its power to regulate carbon dioxide emissions under a 2007 Supreme Court ruling, plans a tailpipe emissions standard of 250 grams per mile for vehicles sold in 2016, roughly the equivalent of what would be emitted by vehicles meeting the mileage standard. Vehicles sold in 2009 are expected to emit about 380 grams per mile, industry sources said. The EPA needs to go through a rulemaking process to allow responses before the standards would go into effect.

One person involved in the negotiation said the Supreme Court's ruling on regulating emissions helped push companies to bargain because they feared the prospect of having to comply with separate EPA standards in addition to those from NHTSA and California.

"That's what brought the companies to the table," the person said.

The other thing the story notes is that the EPA will also go forward with standards for vehicle air coolant emissions, and that compliance with these rules may generate credits toward meeting the fuel economy standards.

Related Posts (on one page):

  1. More on the New Auto Emission & Efficiency Standards:
  2. New National Vehicle Emission & Efficiency Standard:

[Peter Leeson, guest-blogging, May 19, 2009 at 8:10am] Trackbacks
The Market Has Spoken

Despite the surge in Somali piracy and encouragement from some employees of the U.S. government, commercial ships aren’t choosing to put armed guards on their vessels. And with good reason: given present conditions, anyway, it’s a bad idea.

As I discuss in The Invisible Hook, like their Caribbean forefathers, Somali pirates are in the business of making money, not harming hostages. Of the 815 hostages Somali pirates took last year, only four died and two were injured under pirate care.

Pirates aren’t treating hostages well because they’re nice guys. They’re treating hostages well because it pays to do so. A dead hostage fetches no ransom and pirates’ business model would collapse if they injured prisoners or allowed them to die. The economics of piracy has a simple bottom line: for all the problems piracy may pose, the threat of dead and injured innocents isn’t one of them.

That could change, however, if commercial ships starting carrying armed guards on their ships. Armed guards will of course defend against pirate attacks, potentially leading to fire fights that could jeopardize innocent sailors’ lives. The prospect of having to battle for their prizes will deter some pirates. But others will remain undeterred. And for the remaining industry, armed guards’ effect may very well be to increase the dangers that piracy poses rather than reducing them.

The profit-driven behavior of commercial shippers corroborates this possibility. Like pirates, commercial shippers also have strong incentives to keep merchant sailors alive and well: insurance costs. If armed guards reduced the dangers of piracy instead of increasing them, commercial shippers’ insurance costs would fall by employing guards instead of rising. But in this case commercial shippers would have hired armed guards already, which they haven’t. Commercial shippers don’t need government to encourage them to undertake the most profitable course of action.

The market has spoken: Even in today’s pirate-infested waters off Somalia, the low probability of being captured by pirates, together with the fact that pirates release their hostages unscathed, means it’s cheaper--and safer--to go without armed guards.


Monday, May 18, 2009

Medical Innovation:

I don't have the expertise to discuss the various health care reform proposals that are being bandied about, but I do know that it's important to ensure that whatever is implemented doesn't interfere with innovation.

Consider my own immediate family. I was born a month premature, a bit over three pounds, in my parents' bedroom after an extremely short (like 5 minutes) labor. I was rushed to the hospital, where I stayed for over a month in a "warmer". A decade or two earlier, I would have been a goner. Two and a half decades later, my cousin's son survived being born three months premature and weighing less than two pounds.

My sister fell through a grandfather clock when she was thirteen, causing severe nerve damage to her arm. The operation took twice as long as originally predicted, and she could have died. Instead, after the surgery and physical therapy, she was almost completely recovered. A decade or two earlier, she surely would have lost the use of her arm, and perhaps not made it through the surgery.

My mother was diagnosed with TTP, a blood disease, in the Fall of 1988. According to the medical articles I read at the time, TTP had something like a 20% survival rate in the 70s, and 65% when she got it, though she lucked into having the leading expert in the world as her hospital physician (after she was initially misdiagnosed by a local quack; my cousin, then a resident, managed to diagnose her over the phone and made her rush to the hospital, in the nick of time), and she (the physician) had more like a 75% survival rate for her patients. The first line treatment failed, but the second line treatment succeeded. A decade earlier, as I recall, doctors didn't even know about the second line treatment, and my mom would have died.

Oh, and you can add my wife, who not too long ago would have died due to complications in one of her pregnancies. Indeed, before the invention of ultrasounds, the doctors wouldn't have even known about the problem until it was way too late.

Given all this, it's not surprising that I get a bit antsy when I hear some politicians talk as if health care is a fixed good, and the only question is how to distribute it properly.


The new Sarbanes-Oxley case:

Since the Supreme Court has granted cert in Free Enterprise Fund v. PCAOB (see here), I thought I would share a summary of the facts of the case, which I prepared as a study guide for my Administrative Law class at University of Houston:

In 2002, following a series of accounting scandals that exposed weaknesses in the reporting requirements for publicly held companies, Congress passed the Sarbanes-Oxley Act of 2002 ("the Act" or "SOX"). Title I of the Act established the Public Company Accounting Oversight Board ("the Board" or "PCAOB") as a new entity to oversee the audits of public companies. The Board's purpose is "to protect the interests of investors and further the public interest in the preparation of informative, accurate, and independent audit reports for companies the securities of which are sold to, and held by and for, public investors." In particular, the Act provides that:

The Board shall, by rule, establish, including, to the extent it determines appropriate, through adoption of standards proposed by 1 or more professional groups of accountants [which it shall designate] or advisory groups [which it shall convene], and amend or otherwise modify or alter, such auditing and related attestation standards, such quality control standards, and such ethics standards to be used by registered public accounting firms in the preparation and issuance of audit reports, as required by this Act or the rules of the Commission, or as may be necessary or appropriate in the public interest or for the protection of investors.

The five members of the PCAOB are appointed by the Securities and Exchange Commission ("the Commission" or "SEC") after consultation with the Chairman of the Board of Governors of the Federal Reserve and the Secretary of the Treasury. Appointment is by majority vote of the five SEC Commissioners. Two PCAOB members must be or have been certified public accountants. After its members are appointed by the SEC, the Board assumes its responsibilities only upon the Commission's determination that the Board has the capacity to carry out the Act's requirements (i.e., that it is properly organized and has appropriate rules and procedures in place). The Commission alone determines whether the Board may "sue and be sued" in any court.

(As for the Commissioners themselves, all five Commissioners are appointed by the President with Senate confirmation. SEC Commissioners can be removed by the President for cause (i.e., for inefficiency, neglect of duty, or malfeasance). The SEC Chairman is selected from among the Commissioners by the President, and serves as Chairman at the President's pleasure. The Chairman often dominates commission policymaking, controls the administrative side of commission business, selects most staff, and sets budgetary policy.)

A member of the Board may be censured or removed from office "for good cause shown" upon a finding by the Commission, after notice and opportunity for a hearing, that the member willfully violated the Act or abused authority, or failed to enforce compliance with a rule or standard without reasonable justification. The Commission is further empowered, by rule, to relieve the Board, consistent with the public interest, of any enforcement authority whatsoever, as well as, by order, to censure the Board and, after notice and opportunity for a hearing, to "impose limitations upon the activities, functions, and operations of the Board" upon finding that the Board has failed to abide by its statutory duties.

"No rule of the Board shall become effective without prior approval of the Commission." To approve a rule, the Commission generally must conduct its own notice-and-comment proceedings. The Commission "shall approve a proposed rule, if it finds that the rule is consistent with the requirements of [the] Act and the securities laws, or is necessary or appropriate in the public interest or for the protection of investors." The Commission is empowered to "abrogate, add to, and delete from" the Board's rules "to assure the fair administration of the [Board], conform the rules promulgated by that Board to the requirements of [the Act], or otherwise further purposes of [the] Act, the securities laws, and the rules and regulations thereunder applicable to [the] Board." The Commission itself is also empowered to promulgate rules in furtherance of the Act.

The Act requires auditors of public companies to register with the PCAOB by submitting applications to the PCAOB, filing periodic reports with the PCAOB, and paying fees to the PCAOB. The SEC may review the PCAOB's accounting support fee rules and denials of regulation applications. The PCAOB may inspect accounting firms and release interim reports detailing any deficiencies in advance of its final conclusions.

When the PCAOB investigates a potential securities law violation, the Board must both inform the Commission and coordinate its activities with the Commission. If a company violates PCAOB rules governing the auditing of public companies, it will be subject to disciplinary actions and sanctions by the PCAOB. Any violation of PCAOB rules "shall be treated . . . as a violation of the Securities Exchange Act of 1934." If the PCAOB determines, after investigation, that an accounting firm has committed a violation, it has the power to impose an appropriate sanction.

All Board adjudications are subject to the Commission's de novo review, upon an immediate stay when an application for review is filed or sua sponte by the Commission. Sanctions imposed by the PCAOB are generally stayed pending Commission review of the inspection report. The Commission is empowered to "enhance, modify, cancel, reduce, or require the remission of a sanction imposed by the Board." The Commission may alter or cancel a sanction imposed by the PCAOB if, "having due regard for the public interest and the protection of investors," the SEC finds that the sanction is "not necessary or appropriate in furtherance of this Act or the securities laws" or is "excessive, oppressive, inadequate, or otherwise not appropriate." Final Commission decisions are reviewable by the Court of Appeals.

Acme Accountants, an accounting firm registered with the Board and subject to an ongoing formal investigation, seeks declaratory and injunctive relief prohibiting the Board from proceeding, arguing that the structure of the Board violates various separation of powers doctrines. What arguments could Acme make, and how would those issues be resolved?

For two possible answers, read the case.

UPDATE: See Michael Greve's article here.


FCC v. Fox Television Stations, Part III: Bono and the FCC's change of course.

This is part of a series of posts discussing the background of the Supreme Court's "fleeting expletives" case from last week, FCC v. Fox Television Stations.

In the last two posts (click here to see the whole string of posts, including this one, on a single page, in chronological order), I talked about the FCC's original policy against indecency on the airwaves, which the FCC explained and defended in its 1975 opinion against the George Carlin monologue (watch a version of it here if you haven't seen it already), and which the Supreme Court upheld in its 1978 case, FCC v. Pacifica Foundation.

Now let's flip ahead 26 years, to the FCC's opinion, "In the Matter of Complaints Against Various Broadcast Licensees Regarding Their Airing of the 'Golden Globe Awards' Program" (click here for a plain-text version).

On January 19, 2003, during NBC's airing of the Golden Globe Awards, Bono said: "This is really, really, fucking brilliant. Really, really great." The Parents Television Council complained, asking the FCC to levy monetary fines against the offending stations. The Chief of the Enforcement Bureau said the material was neither obscene nor indecent — and as to indecency, he found that Bono's language "did not describe, in context, sexual or excretory organs or activities and that the utterance was fleeting and isolated." PTC appealed to the Commission.


Who Counts as an "Ethnically and Racially Diverse" Jew?

In an article on the appointment of the first-ever black female rabbi in the United States, the Jerusalem Post writes that "[s]he will be the first African-American rabbi to lead a majority white congregation, despite the fact that about 20 percent of the American Jewish community is ethnically and racially diverse, according to the San Francisco-based Institute for Jewish and Community Research."

It's hard to understand what that means. Is it that 20% of American Jews are nonwhite (possible, but unlikely)? Of course American Jews are ethnically (if not always racially) diverse in the sense that they come from many different countries. But how did the Post come up with the 20% figure?

Apparently, the 20% number comes from this study by the Institute for Jewish and Community Research, which found that about 20% of American Jews are "African-American, Asian- American, Latino, Sephardic (of Spanish and Portuguese descent), Middle Eastern, and mixed-race Jews." It's not clear, however, why these groups count as "diverse," while Greek Jews, Hungarian Jews, or Italian Jews others do not. It's not a racial distinction, since many Latino Jews and Sephardic Jews from Spain and Portugal are not darker-skinned than Jews from many other parts of Europe.

The real answer may be that the groups listed as "diverse" in the IJCR study are those (with the possible exception of Sephardic Jews of European descent[update: and possibly also "Middle Eastern" Jews]) who might qualify for preferences under various affirmative action programs; roughly speaking, the groups in question are nonwhite groups that have historically suffered discrimination at the hands of state and federal governments. But even if that definition of "diversity" is the right one for purposes of allocating affirmative action benefits, it makes little sense in the completely different context of trying to analyze the ethnic complexity of the Jewish community.

UPDATE: An alternative explanation is that the IJRC study means to count as "diverse" all non-Ashkenazic Jews. However, most Greek and Italian Jews are non-Ashkenazi, yet they don't seem to be included in the study's "diverse" category. Also, many Asian-American and mixed-race Jews follow Ashkenazic rites, yet they are.


Question on family rights and international law:

A nation has ratified the International Covenant on Civil and Political Rights. Several provisions of the Covenant protect family rights:

Article 17. "1. No one shall be subjected to arbitrary or unlawful interference with his privacy, family, home or correspondence, nor to unlawful attacks on his honour and reputation. 2. Everyone has the right to the protection of the law against such interference or attacks."

Article 23. "1. The family is the natural and fundamental group unit of society and is entitled to protection by society and the State. 2. The right of men and women of marriageable age to marry and to found a family shall be recognized."

Article 24. "1. Every child shall have, without any discrimination as to race, colour, sex, language, religion, national or social origin, property or birth, the right to such measures of protection as are required by his status as a minor, on the part of his family, society and the State."
For the purpose of limiting population growth, a nation imposes a building ban in a particular area. As a result, newly-married couples often cannot find a home to live in, and so have to move elsewhere. Also, growing families are not allowed to remodel their houses in order to make the house larger for the additional children.

Do the nation's policies violate the International Covenant on Civil and Political Rights? What if the nation forbids people in the area to marry, but allows them to marry if they move to a different area? What if the nation forbids or rations births which are legally allowed in the area, but allows unlimited births elsewhere? If there is a violation of the ICCPR, then is it a violation of the ICCPR for other countries to encourage and/or pressure the nation to continue its current course of conduct? For purposes of this question, presume that all relevant nations have ratified the ICCPR, and ignore the question of whether the ratification makes the Covenant self-executing.

The particular question arises in regard to Judea and Samaria, where Israel, under pressure from the U.S. government, has drastically restricted construction in many communities, so that there is not enough housing to accommodate "natural growth" in population (meaning growth caused by generation-to-generation population increase, rather than growth caused by immigration). For details, see Haaretz (building restrictions), the Jewish Telegraph Agency (Peres tells Biden that Israel can't tell settlers not to get married and have children), and Ynet (which says that some new building is taking place).

In the comments, please keep the focus on the legal issues, rather than pro/con debates over Israelis living in Judea and Samaria. The only exception to this instruction is if your answer itself depends on some related legal issue. For example, "Normally, the restrictions would violate the ICCPR, but the restrictions are permissible because Israelis living in Judea and Samaria is itself of a violation of X international law, and for Y reason, Israel's legal obligation to obey X trumps Israel's obligation to obey the ICCPR."


Judge Wu Reschedules Sentencing in Lori Drew Case to July, Leaves Motion to Dismiss Undecided: Today was the scheduled day for sentencing in the Lori Drew case, and presumably the day when Judge Wu would hand down the ruling on the motion to dismiss. I wasn't able to make it out there for the ruling, but the Associated Press is reporting that Judge Wu did not decide the motion to dismiss and instead rescheduled the sentencing hearing to July:
  A Los Angeles federal judge has delayed the sentencing of a Missouri mother for her role in a MySpace hoax directed at a 13-year-old neighbor girl who ended up committing suicide.
  U.S. District Judge George Wu on Monday rescheduled Lori Drew's sentencing to July 2.
  The judge says he wants to review some testimony by prosecution witnesses. He did not rule on a defense motion to dismiss Drew's convictions on three misdemeanor counts of accessing computers without authorization
UPDATE, @7pm: Kim Zetter of Wired News has now posted her summary, which adds a bit of detail:
  After an hour of discussion with prosecutors and Drew’s defense attorney, U.S. District Judge George Wu indicated he was still weighing a defense motion to overturn the jury verdict in the case and that he needs to review transcripts from the trial to weigh both the motion to overturn and the sentencing. Sentencing is now set for July 2nd.
  Wu peppered U.S. attorney Mark Krause repeatedly about using the Computer Fraud and Abuse Act to prosecute Drew and the government’s assertions about who constitutes a victim in the case.


The Coming Explosion of Federal Spending:

My George Mason colleague Veronique de Rugy has an excellent article on the explosion of federal spending built into the Obama Administration's budget plans for the next decade. As Veronique points out, there will be massive increases in both spending levels and the deficit even under the administration's optimistic projections, which unrealistically assume extremely high rates of economic growth, fail to consider much of the administration's proposed increases in health care spending, and also assume that all of the "temporary" stimulus spending will be completely phased out - despite long experience showing that it is extremely difficult to cut budget items once spending on them has increased. Even the administration's optimistic calculations predict a deficit of $712 billion in 2019 (compared to $455 billion in 2008). The administration also predicts that nonmilitary federal spending will be 17% in 2019, about 15% higher than in 2008 and some 30% higher than in the last year of the Clinton Administration. The Democratic-controlled Congressional Budget Office has reached even more pessimistic conclusions in its analysis, which uses more realistic growth projections.

Back in October, I expressed my fear that the combination of an Obama victory, simultaneous Democratic control of Congress and the executive branch, and the economic crisis, would lead to a massive expansion of government. Sadly, that prediction seems to have been vindicated.

It's true that Obama's spending policies are in some respects a continuation of Bush's. The Bush Administration also presided over massive increases in federal spending and regulation, and I often criticized them for it (e.g. here and here). However, Obama's spending plans far exceed even Bush's dubious record. Justifying Obama's spending proposals by reference to Bush is much like an already obese man claiming that upping his consumption of hamburgers to twenty every day is fine because he spend the last eight years eating ten per day.

Liberal Washington Post economics columnist Robert Samuelson makes some related points in this op ed. Samuelson also considers the clever political strategy behind the Administration's spending policy:

One reason Obama is so popular is that he has promised almost everyone lower taxes and higher spending. Beyond the undeserving who make more than $250,000, 95 percent of "working families" receive a tax cut. Obama would double federal spending for basic research in "key agencies." He wants to build high-speed-rail networks that would require continuous subsidy. Obama can do all this and more by borrowing.

Consider the extra debt as a proxy for political evasion. The president doesn't want to confront Americans with choices between lower spending and higher taxes — or, given the existing deficits, perhaps both less spending and more taxes. Except for talk, Obama hasn't done anything to reduce the expense of retiring baby boomers. He claims to be containing overall health costs, but he's actually proposing more government spending...

Implicitly, the administration is hoping to exploit voters' political ignorance. If voters were well-informed about federal budget and tax policy, they would understand the contradiction between the Administration's plans to massively increase spending and its tax cut promises. At some point, the bill for all that debt will have to be paid in the form of either inflation or massive tax increases that go well beyond "the rich." But since most citizens are "rationally ignorant" about politics, they are likely to be unaware of the problem. Thus, Obama and other politicians can promise massive spending increases while at the same time promising tax cuts, and reap political benefits for doing so. Of course there will be political fallout for whoever is president in 2020 and has to face the resulting serious fiscal crisis. But that is of little concern to today's incumbents, who are understandably focused on their own more immediate political future.

Obama is far from the first political leader to exploit public ignorance. Certainly, the Republicans have used similar tactics in the past, including under the Bush Administration. That fact, however, doesn't make our current situation any better.

UPDATE: It's important to recognize that the gargantuan deficits and looming fiscal crisis likely to result from the Administration's spending plans are just one part of the danger we face. Such massive increases in federal spending also exacerbate the more general problems caused by expanding government control over society. In particular, growing federal spending and regulation will make it even more difficult for rationally ignorant voters to impose meaningful democratic control on public policy. And they will provide numerous opportunities for interest groups to exploit the growth of government for their own benefit, at the expense of the general public.

I discuss both these dangers in more detail in the January post linked earlier in this update.


Maureen Dowd's Copying of Josh Marshall's Sentence:

Check out Prof. Mark Liberman's take on this at Language Log.


Will the Supreme Court Limit the Scope of the Honest Services Fraud Statute?: Back in February, I blogged about Justice Scalia's dissent from denial of certiorari in Sorich v. United States, in which Justice Scalia drew attention to the remarkably broad lower court precedents interpreting the scope of honest services fraud. I wrote, " Go, Nino, go. I hope this signals renewed interest in this statute — and more generally, in the need to construe criminal statutes narrowly."

  In light of that post, I thought I would flag to readers that the Supreme Court granted certiorari in Black v. United States, a case challenging the conviction of Conrad Black, that will raise some of these issues. The petition for certioari (with Miguel Estrada as counsel of record) is here. The lower court opinion, by Judge Posner, is here.

New National Vehicle Emission & Efficiency Standard:

Tomorrow the White House will announce new federal fuel efficiency standards for motor vehicles that will require a 35 mpg fleet average by 2016. This standard will also serve as a de facto national greenhouse gas emission standard equivalent to the standard adopted by California, prompting California to "stand down" from pursuing its own separate GHG standards. I have also heard that, in response, the major automakers will drop their various challenges to state GHG standards. Do not be surprised if this new rule also becomes the new GHG emissions standard under Section 202 of the Clean Air Act. The NYT has more here.

UPDATE: I am quite sure this -- and not a pending Supreme Court nomination -- is the reason Gov. Granholm will be at the White House tomorrow. If I'm wrong, I'll owe Orin a beer.

Related Posts (on one page):

  1. More on the New Auto Emission & Efficiency Standards:
  2. New National Vehicle Emission & Efficiency Standard:

Early Commentary on Free Enterprise Fund v. PCAOB:

NYU law professor Rick Pildes has a lengthy post on Balkinization previewing Free Enterprise Fund v. PCAOB, "the most important challenge in two decades in the ongoing debate between those who believe in the “unitary executive branch” theory of Art. II of the Constitution and those who endorse the constitutional validity of independent agencies." Prof. Pildes, who represented amici supporting the PCAOB below, doubts the Supreme Court will invalidate the Board unless it is willing to challenge the constitutionality of independent agencies. I am not so sure.

As I read it, Prof. Pildes' argument rests on the claim that the Board is under the SEC's near-complete control, and thus the Board's members are inferior officers. This may be true insofar as the SEC's authority over the Board is concerned, but the statute also provides that Board members can only be removed for cause. This structural feature necessarily attenuates the SEC's practical control over the Board — even if SEC retains near-plenary authority to direct or overturn Board actions — and dramatically diminishes any Presidential control over the Board. Structure matters, and agency costs are real. Accepting that independent agencies are constitutional (either on first principles or precedent), does not mean that anything goes. It may be kosher to create an agency at one level of remove from direct Presidential authority, and still impermissible to nest one independent agency within another. Or, to paraphrase Judge Kavanaugh's dissent below, accepting Humphrey's Executor does not require accepting Humphrey's Executor squared. I would agree with Prof. Pildes, however, that it may be difficult for the Cort to invalidate the PCAOB without casting doubt on other Appointments Clause precedents, such as Morrison v. Olson.

Former Solicitor General Kenneth Starr and former Assistant AG Viet Dinh have a different take on the case, as they represent the plaintiffs. Last Friday they had an op-ed in the WSJ arguing not only that the PCAOB is unconstitutional, but also that the Board's "lack of an accountable structure has likely contributed to what members of both parties see as its policy failures."

This is a fascinating and potentially important case (as I stressed to my Administrative Law students last year), and it is definitely worth watching.

UPDATE: Professor Bainbridge has more here.


The Europeanization of US Antitrust Law:

Keith Hylton, Geoffrey Manne, and Josh Wright here.


Breaking: Sarbanes-Oxley to the Supremes:

This morning the Supreme Court granted certiorari in Free Enterprise Fund v. Public Company Accounting Oversight Board, a constitutional challenge to portions of the Sarbanes-Oxley Act. Appointments Clause cases don't come along all that often, and this one's a doozy — "Humphrey's Executor squared" according to Judge Kavanaugh's dissent on the D.C. Circuit. Our prior posts on this case are collected here.

Links to the filings, and today's other cert grants, are on SCOTUSBlog here.


[Peter Leeson, guest-blogging, May 18, 2009 at 9:57am] Trackbacks
Private Law and Order: Somali Pirate Edition

As I discuss at length in The Invisible Hook, those pop-culture phenoms, the pirates of old, had a well-developed system of private law and order. Early 18th-century pirates created rules that prohibited violence and theft; regulated gambling, smoking, and drinking; and established procedures for selecting officers of these laws’ enforcement. The result was surprisingly orderly and cooperative early 18th-century pirate societies.

However, until recently, these sea dogs’ Somali successors showed little discernable social organization. In large part this is because they didn’t form societies. There weren’t enough Somali pirates, nor did they spend enough time together plying their illicit trade, to constitute a group (or groups) requiring law and order.

But times for the Somali pirates, they are a changing. Over the last year or so Somali piracy has flourished into a full-blown economic activity in some of Somalia’s coastal communities. Somalia’s modern sea bandits pirate full time; and while they spend little time together on their ships, they spend significant time together in their pirate communities on land. A new, albeit different, pirate society is being born.

Pirates thus face a governance problem they haven’t faced since, well, the 18th century. And they’re rising to the occasion. Somali sea dogs have a code of conduct that includes rules for dealing with inter-pirate theft, conflict, and theft from their victims.

According to one Somali pirate, for example, “If any one of us shoots and kills another, he will automatically be executed and his body thrown to the sharks.” Further, this pirate added, “If a pirate injures another, he is immediately discharged and the network is instructed to isolate him. If one aims a gun at another, he loses five percent of his share of the ransom.”

According to another Somali sea dog, “Anybody who is caught engaging in robbery on the ship [the pirates overtake] will be punished and banished for weeks. Anyone shooting a hostage will immediately be shot.” “I was once caught taking a wallet from a hostage. I had to give it back and then 25,000 dollars were removed from my share of the ransom.”

The Somali pirates’ “laws” are enforced by a “mobile tribunal,” a kind of traveling pirate court, that oversees relations between the significant number of Somali “pirate cells”— separate but coordinated bands of sea scoundrels that dot Somalia’s coastline.

There remain important differences between 18th century- and modern Somali-pirate governance. These differences reflect the different, specific governance needs of each kind of pirate’s community. For example, it was important for early 18th-century pirates to regulate smoking because of the significant negative externality one pirate’s unrestricted tobacco use could impose on his partners in crime. Early 18th-century pirate ships were made of wood and cloth and carried large quantities of gunpowder. A careless pirate smoker was thus liable to destroy the ship or, worse yet, blow the crew to smithereens.

Modern pirating vessels, in contrast, are metal, and aren’t carrying gunpowder. One pirate’s smoking behavior poses a much smaller risk to the rest of the crew. And on land, where modern pirates spend the majority of their time together, smoking presents no such risk to others. Somali pirates, then, don’t need to create rules governing tobacco use in their society; so they don’t.

Similarly, given their unique governance needs, Somali pirates have private institutions of law and order that 18th-century pirates didn’t have, such as their traveling court. Since Somali pirate organization involves the cooperation of numerous and geographically separated groups, Somali pirates require a mobile judiciary that can oversee conflicts and enforces pirate law “industry wide.”

In contrast, early 18th-century pirate societies were floating ones--those aboard their ships. They operated as independent units rather than as part of a coordinated whole together with all of the other pirates in the Caribbean. Eighteenth-century pirates therefore had no need for a traveling court. Each crew resolved its disputes on board via an officer called the quartermaster whose judicial authority extended only over the members of his crew.

Private pirate law and order is alive and well in allegedly “lawless” Somalia, and highlights two important lessons. First, even outlaws require social order and private governance institutions emerge to create this order when government does not. Second, when they emerge endogenously, as in do pirate societies, these governance institutions develop to reflect the particular needs of the individuals they govern. The resulting effectiveness of such institutions is certainly part of the reason for 18th-century pirates’ success. I suspect the private governance institutions that support the Somali pirates’ criminal economy deserve considerable credit for these sea dogs’ success so far too.


Um, I Don't Think You're Qualified:

Found in the "talkbacks" to an article on Israel trying to recruit "Anglo" English teachers, from a Brazilian:

I'd leaved 10 Years in New York, United States and did many english course, I'm fluent in english speaking and writting. I'm a music teacher, voice, piano, eletronic keyboard and organ, working at a music school for 10 Years. I'm interested on the job for english teacher, also in leaving in Israel.


Climate Policy as Sausage Making:

The NYT has an interesting article this morning on how cap-and-trade became the greenhouse gas emission-control strategy of choice.

How did cap and trade, hatched as an academic theory in obscure economic journals half a century ago, become the policy of choice in the debate over how to slow the heating of the planet? And how did it come to eclipse the idea of simply slapping a tax on energy consumption that befouls the public square or leaves the nation hostage to foreign oil producers?

The answer is not to be found in the study of economics or environmental science, but in the realm where most policy debates are ultimately settled: politics.

Many members of Congress remember the painful political lesson of 1993, when President Bill Clinton proposed a tax on all forms of energy, a plan that went down to defeat and helped take the Democratic majority in Congress down with it a year later.

Cap and trade, by contrast, is almost perfectly designed for the buying and selling of political support through the granting of valuable emissions permits to favor specific industries and even specific Congressional districts. That is precisely what is taking place now in the House Energy and Commerce Committee, which has used such concessions to patch together a Democratic majority to pass a far-reaching bill to regulate carbon emissions through a cap-and-trade plan.

Yet the same things that make cap-and-trade politically viable — the ability to buy off special interests — also makes it particularly vulnerable to rent-seeking and interest group manipulation. In politics this may be a feature, but for sound policy it is a bug. Rent seeking may grease the skids for a law's enactment (and help the sausage get made), it can also compromise the law's ultimate effectiveness (as Europe has discovered). And the more complex and comprehensive a cap-and-trade system becomes, the greater its vulnerabilities. The compromises in the House bill go beyond doling out free credits, and therein lies the larger policy risk. And insofar as cap-and-trade, in theory, can resemble a carbon tax — it's really a carbon tax plus corporate welfare.

Paul Krugman weighs whether the current House climate bill is "good enough" to merit liberal support. To some, a leaky cap-and-trade bill is still a major leap forward. In the short run, creating the regulatory architecture for carbon control is more important than precise emission limits. Yet Krugman goes farther, arguing that cap-and-trade would be superior to a carbon tax even if the latter were politically viable.

One objection — the claim that carbon taxes are better than cap and trade — is, in my view, just wrong. In principle, emission taxes and tradable emission permits are equally effective at limiting pollution. In practice, cap and trade has some major advantages, especially for achieving effective international cooperation.

Not to put too fine a point on it, think about how hard it would be to verify whether China was really implementing a promise to tax carbon emissions, as opposed to letting factory owners with the right connections off the hook. By contrast, it would be fairly easy to determine whether China was holding its total emissions below agreed-upon levels.

In my view, Krugman is just wrong. The idea that monitoring China's emission levels is "fairly easy" is, well, ludicrous. It's difficult to do in the United States and Europe — where annual emission inventories are regularly revised to incorporate new knowledge about emission sources and sinks — but Krugman thinks it will be "easy" to do in China?!? Even assuming we could monitor China's major industry, this does not account for all China's emissions. And if we're interested in monitoring net carbon impacts — and awarding offsets — the enterprise becomes vastly more complex. Measuring offsets would be tricky in the U.S., but impossible over there. In this regard, the relative simplicity of the carbon tax is a virtue, not a vice, even if it would be more difficult to enact. Add the fact that a carbon tax could be adopted without increasing the total tax burden on the economy, by offsetting it with reductions in other taxes, and I remain firmly in the carbon tax camp.


Jerome Frank on Oliver Wendell Holmes:

Whe did Justice Holmes consistently defer to legislative initiatives, while his colleagues were more likely to invoke traditional constitutional limitations on government authority? According to Jerome Frank, it was because Holmes was "The Completely Adult Jurist," who has "put away childish longings for a father-controlled world" and attained "an adult emotional status, a self-reliant, fearless approach to life." He therefore "can afford not to use his authority as if he, himself, were a strict father." See Jerome Frank, Law and the Modern Mind 270-276 (1931).

It's remarkable that the intellectual class once took such Freudian claptrap seriously. [Oddly, modern scholars still cite Frank's famous characterization of Holmes as "a completely adult jurist" as if it reflected some real insight beyond a crude Freudian analysis. I wonder if this reflects a failure to read the original source.]


Arrrh! Pirates!

A couple of months ago, I got in the mail a review copy of a then-forthcoming book. I usually don't focus much on such copies (unless they're science fiction or fantasy, or unless they're by someone whose work I know and like), but this one grabbed my interest from the outset. I read it and much enjoyed it, and decided that I had to have the author guest-blog about the subject. The book is now out, and I'm delighted to report that the author will be with us this week to discuss it.

The author, Peter Leeson, is an economics professor at George Mason University, and the author of more than 60 academic journal articles analyzing a wide range issues in political economy and law and economics. And the book is The Invisible Hook: The Hidden Economics of Pirates, which uses basic economic theory to explain and explore infamous pirate behaviors. (We're talking the 1700s "Arrrh!" pirates, the cool and romantic ones that are safely in the past, not the modern ones that are actually a danger to us today, though the author briefly touches on the modern pirates near the end.) Here's a summary of the book from Princeton University Press:

Pack your cutlass and blunderbuss — it's time to go a-pirating! The Invisible Hook takes readers inside the wily world of late seventeenth- and early eighteenth-century pirates. With swashbuckling irreverence and devilish wit, Peter Leeson uncovers the hidden economics behind pirates' notorious, entertaining, and sometimes downright shocking behavior. Why did pirates fly flags of Skull & Bones? Why did they create a "pirate code"? Were pirates really ferocious madmen? And what made them so successful? The Invisible Hook uses economics to examine these and other infamous aspects of piracy. Leeson argues that the pirate customs we know and love resulted from pirates responding rationally to prevailing economic conditions in the pursuit of profits.

The Invisible Hook looks at legendary pirate captains like Blackbeard, Black Bart Roberts, and Calico Jack Rackam, and shows how pirates' search for plunder led them to pioneer remarkable and forward-thinking practices. Pirates understood the advantages of constitutional democracy — a model they adopted more than fifty years before the United States did so. Pirates also initiated an early system of workers' compensation, regulated drinking and smoking, and in some cases practiced racial tolerance and equality. Leeson contends that pirates exemplified the virtues of vice — their self-seeking interests generated socially desirable effects and their greedy criminality secured social order. Pirates proved that anarchy could be organized. Revealing the democratic and economic forces propelling history's most colorful criminals, The Invisible Hook establishes pirates' trailblazing relevance to the contemporary world.


Should President Obama Create a Domestic Terror Court?

My colleague Amos Guiora argues "yes" in this interesting article. Here is the nub of the argument:

President Barack Obama has stated that among his initial priorities as commander-in-chief is closing the United States detention facility in Guantanamo Bay. One of his first actions after taking office was to suspend all legal proceedings in Guantanamo so that “the newly inaugurated president and his administration [can] review the military commission’s process, generally, and the cases currently pending before military commissions, specifically.” To that end, on January 22, 2009, President Obama signed an executive order requiring the closure of the Guantanamo Bay detention facility within one year. This Order raises numerous, highly problematic questions including: What do we do with the current detainees? Where will they go? How will they be tried? Will they be tried? What shall be done with future terrorism suspects?Although President Obama has made his intentions clear, he has not, as of yet - according to media reports - determined what is the most effective manner to go forth with this enormously complex issue. Therefore, now is clearly the time to develop a working strategy to resolve the fundamental questions of where and how thousands of post-9/11 detainees are tried. For the reasons articulated below, I recommend establishing a domestic terror court (DTC) in the United States.

This article will detail the specific processes and procedures of such a court and seek to answer many of these difficult questions. In doing so, it is my hope that this article will act as a “guide” for policy makers in articulating, developing, and implementing a process from detention to trial of individuals suspected of involvement in terrorism. A lawful civilian process, subject to independent judicial review, is the constitutional, intellectual, and philosophical underpinning of this proposal. In detailing the nuts and bolts of the proposed DTC. Though I will briefly address why the DTC proposal should be adopted, the primary emphasis in this article is to fill in the blanks as to the workings of the court.

This seems like a lot more sensible approach than many other proposals I have seen.


High State Taxes Lead to Big Budget Deficits and Low Job Growth.

In the Wall Street Journal, Arthur Laffer and Stephen Moore review some of evidence on the problems of states that raise taxes substantially. Basically, it doesn't work.

Here's the problem for states that want to pry more money out of the wallets of rich people. It never works because people, investment capital and businesses are mobile: They can leave tax-unfriendly states and move to tax-friendly states.

And the evidence that we discovered in our new study for the American Legislative Exchange Council, "Rich States, Poor States," published in March, shows that Americans are more sensitive to high taxes than ever before. The tax differential between low-tax and high-tax states is widening, meaning that a relocation from high-tax California or Ohio, to no-income tax Texas or Tennessee, is all the more financially profitable both in terms of lower tax bills and more job opportunities.

Updating some research from Richard Vedder of Ohio University, we found that from 1998 to 2007, more than 1,100 people every day including Sundays and holidays moved from the nine highest income-tax states such as California, New Jersey, New York and Ohio and relocated mostly to the nine tax-haven states with no income tax, including Florida, Nevada, New Hampshire and Texas. We also found that over these same years the no-income tax states created 89% more jobs and had 32% faster personal income growth than their high-tax counterparts.

Did the greater prosperity in low-tax states happen by chance? Is it coincidence that the two highest tax-rate states in the nation, California and New York, have the biggest fiscal holes to repair? No. Dozens of academic studies — old and new — have found clear and irrefutable statistical evidence that high state and local taxes repel jobs and businesses.

Martin Feldstein, Harvard economist and former president of the National Bureau of Economic Research, co-authored a famous study in 1998 called "Can State Taxes Redistribute Income?" This should be required reading for today's state legislators. It concludes: "Since individuals can avoid unfavorable taxes by migrating to jurisdictions that offer more favorable tax conditions, a relatively unfavorable tax will cause gross wages to adjust. . . . A more progressive tax thus induces firms to hire fewer high skilled employees and to hire more low skilled employees."

More recently, Barry W. Poulson of the University of Colorado last year examined many factors that explain why some states grew richer than others from 1964 to 2004 and found "a significant negative impact of higher marginal tax rates on state economic growth." In other words, soaking the rich doesn't work. To the contrary, middle-class workers end up taking the hit. . . .

Examining data from a 2008 Princeton study on the New Jersey tax hike on the wealthy, we found that there were 4,000 missing half-millionaires in New Jersey after that tax took effect. New Jersey now has one of the largest budget deficits in the nation.

We believe there are three unintended consequences from states raising tax rates on the rich. First, some rich residents sell their homes and leave the state; second, those who stay in the state report less taxable income on their tax returns; and third, some rich people choose not to locate in a high-tax state. Since many rich people also tend to be successful business owners, jobs leave with them or they never arrive in the first place. This is why high income-tax states have such a tough time creating net new jobs for low-income residents and college graduates.

Read the whole thing.

"NYTimes Columnist Admits Using Blogger's Words": The Associated Press has the story about Maureen Dowd's recent column that copied (without attribution) some of Josh Marshall's commentary. More details here. Strange.

Sunday, May 17, 2009

[Ira Matetsky, guest-blogging, May 17, 2009 at 11:54pm] Trackbacks
Wikipedia: Some Concluding Thoughts and an Invitation:

A few years ago, as the promised Information Superhighway was growing into the Internet that we know today, no one (to my knowledge) predicted that a collaboratively written, free-content, mass-linked website aspiring to cover all areas of human knowledge would become one of the most prominent information sources in the world. Still less did I anticipate that I would eventually play a role helping to administer such a site.

Eugene inspired me to volunteer this series of posts, now drawing to a close, by discussing a series of cases in which courts have either cited to Wikipedia for information, or asked themselves whether they can take judicial notice of the content of a Wikipedia article.

My own take on the reliability of Wikipedia articles is consistent with that suggested by some of the commenters: articles on non-contentious topics are usually accurate; articles on highly contentious articles are usually accurate on basic facts, but can be subject to bias and dispute with respect to the matters in controversy. It's an overgeneralization, but in essence, if debating a subject could lead to a fist-fight in a bar, or to a heated dispute in academe, then sooner or later the subject will be involved in a content dispute on Wikipedia. This is really not a surprise.

(The surprise comes from how many additional petty matters we also argue about. The people who sometimes refer to Wikipedia administrators and experienced editors collectively as a "Hivemind" may have overlooked the amount of bickering that goes on every day on the Administrators' Noticeboards.)

However, a strong article with more than the most basic content should contain citations of sources where information in the article was drawn from. Checking the sources, and where appropriate citing to them rather than the Wikipedia article itself, may often resolve the question of "is Wikipedia reliable enough to cite?" If no sources are cited, check the links to related articles; the relevant sources may be there. Otherwise, the article history will tell you who wrote the article, and sometimes a query on his or her usertalkpage will elicit the missing references. Beyond that, every article on Wikipedia has an associated "talkpage" where issues concerning the contents of the article, including requests for sourcing of controversial statements, may be addressed.

Anyone relying on Wikipedia must take into account that there are no guarantees as to who contributed a given article or sentence, or why. (In fact, this is emphasized in a couple of places on the site itself.) I think the general population of Internet users has become more aware of both the strengths and weaknesses of various resources, including Wikipedia, than was the case even a few years ago. At a dinner with extended family recently at which my role on Wikipedia came up, my niece, aged 11, told me that her middle-school librarian had cautioned her students not to rely automatically on the accuracy of Wikipedia and to double-check the information before using it for anything important.

More generally, everyone, and especially those young enough not to remember pre-Internet times, will all come to learn more generally which types of research can effectively be performed on the Internet, and which benefit most from access to older or more traditional resources. (Readers who are lawyers will recognize this as analogous to the discussions that go on between younger lawyers heavily dependent on Lexis or Westlaw, and more senior lawyers who believe that thinking through a problem and researching comprehensively often requires a trip to the library.) No one — whether a student writing a paper or someone looking for information — should simply accept information derived from any source without thinking through the quality of the source and what biases it might introduce.

Wikipedia is a valuable but a flawed resource and, as I stressed in the first of these posts, its main strength is also its main weakness: that anyone can contribute to it. Some articles suffer from political or other biases (a core content policy is that all articles must be written from a "neutral point of view," but not every editor is committed to upholding policy, and in any event, NPOV is often in the eye of the beholder). Some articles have been tampered with playfully or maliciously, and although most "vandalism" or "trolling" edits are picked up and reverted quickly, others are not, and some have lingered for months.

(Most vandals are just passing nuisances, such as bored schoolchildren, but some are more persistent, and a small but extremely troublesome handful are persistent to the point of doing serious damage. I'd be interested, just as a point of information, in learning whether there is any legal precedent for in some fashion barring such people from write-accessing or editing on a site. I will add that this is intended as a purely academic question.)

Moreover, the quality of articles varies very widely, and some articles need to be expanded or rewritten before they will have much value. Some articles are absent altogether; even with 2.8 million articles, there is a lot more yet to be written. (I envy some of the earlier editors who had the whole scope of knowledge to write on a blank slate, but there is still plenty more to be done. The occasional suggestion that "everything worth writing on-wiki has been written" is no more accurate than the comment of the apocryphal patent examiner who supposedly urged that "everything worth inventing has been invented.)

And yet — for all of Wikipedia's flaws, the fact is that it has become a central resource relied upon by many. That suggests that researchers typically find Wikipedia content both accessible and reliable. As I pointed out in my first post, Conspirators on this blog often link to a Wikipedia article when introducing a topic. They wouldn't do that if the articles weren't reasonably reliable at least in their basics. In my own experience, when I Google a topic and I come upon the Wikipedia article and read it, I find the information reliable. It may or may not be complete or brilliantly written, but it rarely is just wrong.

This will be my last post in this series, but I'll try to respond to any ongoing dialog in the comment thread. For those interested in further discussion, I assure you that there is ongoing dialog about virtually every issue affecting Wikipedia to be found somewhere right on Wikipedia. Although a few core policies are handed down by the Wikimedia Foundation, and some others arise from technical features and limitations of the software, almost all other Wikipedia policies and guidelines are developed largely by "the community," which means the collective body of editors, and more specifically, those who care enough about a given issue to participate in discussing it.

For those interested in discussing these issues without venturing onto Wikipedia itself, there is ongoing discussion of both theoretical objections to Wikipedia's structure and day-to-day operating issues on a website called "Wikipedia Review" ( (I participate there on occasion myself — I had not intended to, but someone invited me to join and I accepted.) "WR" can be a mixed bag, containing some instances of overgeneralizations and too much nasty ad hominem for my taste — but interspersed with that is some of the more well-reasoned criticism and commentary I've seen. WR also has a blog,, whose contents be more accessible than the sometimes "inside baseball" discussions on the main forum. More recently, some present and former WR members have started another site,, which also contains critical essays and commentary.

But in my opinion, the best way of enhancing or improving Wikipedia, whether by tweaking one article at a time or by advocating for some site-wide policy change, is to roll up one's sleeves and join in contributing there. For me, at least, I've combined the fun of a new hobby mixed with the enjoyment of sharing knowledge and helping resolve disputes.

Remember, anyone can edit, with or without registering an account. (Creating a brand-new article requires registration, which can be done using one's real name or a pseudonym.) The user interface is accessible even to those without computer skills (believe me, if I could master it, then anyone can), and within a few minutes of sitting down at the keyboard, you'll be an editor and a Wikipedian. Any editor can edit not just articles, but the policy discussions and related pages as well.

If you get stuck, [[Wikipedia:Help]] should link you to a page containing whatever information you need, although Volokh Conspirators (and anyone else) are also welcome to inquire at [[User talk:Newyorkbrad]] if you run into any problems. Perhaps a few of us can conspire there to pick a law-related article to collaborate on and bring up to Featured Article. (And also feel free to e-mail me with any questions or comments if you prefer; please use Newyorkbrad -at- rather than my work e-mail for this purpose.)

My thanks to Eugene and the other Conspirators for giving me a forum here this week (and also for giving me lots of interesting and challenging blog-reading over the years), to everyone who has commented or will comment on one of my posts, to the knowledgeable people who responded in detail to my query on Monday about the [[Saxbe fix]], and to all of the readers.


Who Would You Pick?

The National Law Journal's Marcia Coyle asked a bunch of law professors and legal experts who they would pick to replace Justice David Souter on the Supreme Court. My response was perhaps a bit pedestrian -- I explained why I think Judge Diane Wood is the "obvious" choice -- but some of the responses she got from other folk are actually quite interesting.


Thanks, GW Law Class of 2009: Every year, the graduating class at GW Law School votes and awards a member of the faculty the Distinguished Faculty Service Award, which is GW Law's version of a teacher award and is formally given for "distinguished teaching, scholarship, and service." This year I was tremendously honored to win that award, bestowed at graduation today. To all the members of the graduating class, thanks very much for the honor — and congratulations.

The Bipartisan (Biofuel) "War on Science":

Biofuels are the answer. Politicians will alter the scientific inquiry accordingly.


Lessig's "Code" at 10:

There’s an interesting discussion going on over at about Larry Lessig’s book Code (and Other Laws of Cyberspace), celebrating the 10th anniversary of its publication. Code’s a very important book, in my view (and, I think, objectively speaking, in the view of pretty much everyone involved in thinking about law and regulation on the Net). Lessig got a lot of things right in Code ; most fundamentally, the idea around which much of the book is organized - that “code is law” on the global network – is a very rich one, and even a profound one, and it has been central to a great deal of very productive thinking in the field. Code got some things wrong, too – most fundamentally, when Lessig argued that it is fruitless (and perhaps even dangerous) to talk about cyberspace's “nature.” [If I could explain my reasons for saying that he was wrong about that without having to write a whole book, I would do so; but I can’t, so you’ll just have read the book if you’re interested].

I’ve written a fair bit about Code, in my book and elsewhere, and I won’t repeat what I’ve already said – in fact, one of the interesting things about Code and its role within the cyberlaw debates of the last decade is that the book actually helped move the conversation forward. Lessig positioned the book as an attack on, and a direct response to, the “cyber-libertarians.” The “cyber-libertarians,” in turn – myself among them – took him to task for that. But after duking it out for a while, it turns out that there wasn’t as much there as we thought: that debate isn’t where the interesting action is, in cyberspace. There’s plenty to argue about, regarding cyberspace law and policy; but arguing about the labels isn’t too useful or productive. That’s precisely the interesting thing about cyberspace; as Lessig puts it, “what drew me to cyberlaw originally was that it (originally) obscured politics. It confused intuitions. And in that confusion, people were forced to think. No crude shorthands. No summary judgment based upon a supposed set of affinities with debates almost a century old.”

So when Adam Thierer, defending the cyber-libertarian position, writes:

“Thus, at risk of repeating myself, I must underscore the key principles that separate the cyber-libertarian and cyber-collectivist schools of thinking. It comes down to this: The cyber-libertarian believes that ‘code failures’ are ultimately better addressed by voluntary, spontaneous, bottom-up, marketplace responses than by coerced, top-down, governmental solutions. Moreover, the decisive advantage of the market-driven approach to correcting code failure comes down to the rapidity and nimbleness of those response(s).”

Lessig can respond: I completely agree.

OK, then; we’re all Jeffersonians, now. (“We are all republicans. We are all federalists.”] We all agree: voluntary, spontaneous, bottom-up, marketplace responses are better than coerced, top-down, governmental solutions – except when they’re not. That is simultaneously both a useless tautology and an important point of consensus. What do we do about copyright law? Should we preserve the ability to speak anonymously on the Net? Should end-to-end network neutrality be preserved? How? We can just assume that we are all looking for the “voluntary, spontaneous, bottom-up” solution – but what is it? What does the voluntary, spontaneous, bottom-up solution to the copyright problem, or the anonymity problem, look like? What is the “problem” we’re trying to solve? Where do we want the system to end up?

Those are the interesting debates, in cyberlaw. There’s plenty to disagree about, and there are lots of heated and important arguments, about what kind of copyright law we should have, or how much anonymity needs protection, or whether end-to-end is valuable in and of itself. The line dividing the opposing viewpoints, though, isn’t captured by the labels; the positions that are staked out don’t fall out along libertarian vs. collectivist lines. Plenty of libertarians, and plenty of collectivists, can agree (if perhaps for different reasons) that copyright law needs a radical overhaul (and there are libertarian and collectivists a-plenty among those who argue that it does not).

That’s good news, I think, because it means that (rough) consensus on particular issues, and specific problems, might actually be achievable – maybe even on the required global scale. Libertarian vs collectivist, Jeffersonian vs Hamiltonian – issues that align themselves clearly along these lines never can get resolved by consensus, because people disagree, quite fundamentally, about these principles. Real change is made possible when those lines don’t define the debate anymore.


Sunday Song Lyric Index & Hiatus:

Love them or hate them, the Sunday Song Lyric is going on a summer hiatus. Barring some profound inspiration -- or something really topical -- I don't expect to post more SSLs until some time in August. Below the jump, however, is an index of all the SSL posts since January 2007. The listing of earlier SSLs can be found here and here. As always, recommendations are welcome, but I doubt I'll post (m)any in the next few months.