As Congress begins (perhaps!) to hold up its end of the invitation to struggle over the Libyan adventure, Chris Preble, Gene Healy and I have prepared a video explaining what’s at stake in this latest American war.
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Federal Jobs Programs Don’t Work
In a 1975 interview, Nobel prize-winning economist Milton Friedman said, “One of the great mistakes is to judge policies and programs by their intentions rather than their results.”
In writing and editing essays on www.DownsizingGovernment.org, I see that mistake in department after department. It is an important reason why policymakers find it so hard to control their spending appetites. They want to believe that programs work, and so they internalize the bedtime stories sold to them by program advocates.
In Politico today, I examine federal employment and job training programs. From FDR to Obama, and from Reagan to Ryan, policymakers have wanted to “do something” to help labor markets. However, jobs programs are not a proper exercise of federal power under the Constitution, and they simply haven’t worked very well despite decades of renaming, retooling, and reinventing.
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Podcast on Internet Privacy and Do-Not-Track
This podcast, put together by the high-performance folks at the Performance Marketing Association, is a pretty good exploration of privacy and proposals to create a “do-not-track” system for the World Wide Web. Though I do use the word “hedonic” at one point, which is a bit much…
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Sorrell vs. IMS Health: Not a Privacy Case
The Supreme Court’s decision in Sorrell vs. IMS Health is being touted in many quarters as a privacy case, and a concerning one at that. Example: Senator Patrick Leahy (D‑VT) released a statement saying “the Supreme Court has overturned a sensible Vermont law that sought to protect the privacy of the doctor-patient relationship.” That’s a stretch.
The Vermont law at issue restricted the sale, disclosure, and use of pharmacy records that revealed the prescribing practices of doctors if that information was to be used in marketing by pharmaceutical manufacturers. Under the law, prescription drug salespeople—“detailers” in industry parlance—could not access information about doctors’ prescribing to use in focusing their efforts. As the Court noted, the statute barred few other uses of this information.
It is a stretch to suggest that this is a privacy law, given the sharply limited scope of its “protections.” Rather, the law was intended to advance the state’s preferences in the area of drug prescribing, which skew toward generic drugs rather than name brands. The Court quoted the Vermont legislature itself, finding that the purpose of the law was to thwart “detailers, in particular those who promote brand-name drugs, convey[ing] messages that ‘are often in conflict with the goals of the state.’ ” Accordingly, the Court addressed the law as a content- and viewpoint-oriented regulation of speech which could not survive First Amendment scrutiny (something Cato and the Pacific Legal Foundation argued for in their joint brief.)
What about patients’ sensitive records? Again, the case was about data reflecting doctors’ prescribing practices, which could include as little as how many times per year they prescribe given drugs. (They probably include more detail than that.) The risk to patients is based on the idea that patients’ prescriptions might be gleaned through sufficient data-mining of doctors prescribing records (no doubt with other records appended). That’s a genuine problem, if largely theoretical given the availability and use of data today. Vermont is certainly free to address that problem head on in a law meant to actually protect patients’ privacy—against the state itself, for example. Better still, Vermonters and people across the country could rely on the better sources of rules in this new and challenging area: market pressure (to the extent possible in the health care area) and the (non-prescriptive, more adaptive) common law.
Whatever the way forward, Sorrell vs. IMS Health is not the privacy case some are making it out to be, it’s not the outrage some are making it out to be, and it’s not the last word on data use in our society.
Individualism in Legal Process and the Wal-Mart Case
Monday’s high court decision in Wal-Mart v. Dukes has predictably drawn a strong reaction from legal academia, much of it critical of the Court. Of particular interest are the comments of Richard Primus (Michigan) at the New York Times’s “Room for Debate” and Alexandra Lahav (Connecticut) at Mass Tort Litigation Blog. According to Primus and Lahav, the decision is the latest sign that the current Supreme Court leans toward a principle of “individualism” in applying the rules of civil litigation. Lahav in particular appears to view this as a shame, since “a more collectivist view” would carry with it more “potential for social reform.”
What does a term like “individualism” mean in the context of litigation procedure? One of its implications is that legal rights to redress on the one hand, and legal responsibility or culpability on the other, are ordinarily things that appertain to individual litigants, and ought not (absent clear authorization by statute or Constitution) be submerged into group claims on the one hand or group guilt on the other. In particular, we should be wary of proposals to deprive litigants of the choice to obtain individualized consideration of their claims or defenses on the grounds that society can accomplish more if it processes litigation in batches while accepting, say, statistical as distinct from personalized proofs.
Lahav and other scholars such as Samuel Issacharoff offer as examples numerous cases in which the Court has insisted on individualized process, often thereby frustrating the advocates of social reform in one or another area. The Court’s scruples on this matter have run into much adverse comment in the academic literature, and that’s hardly a surprise; as I argue in my book Schools for Misrule, today’s legal academy is far more keen on things like group rights and social engineering (as some of us might call it) than is the wider society.
Let me offer a few observations in defense or at least explanation of the Court’s approach:
1) The individualist leaning is by no means confined to the “conservative” justices; all nine members of the current Court partake of it to varying extents, and it is one major reason why the Court’s liberal justices joined in to make the Wal-Mart decision unanimous on one of its most practically significant issues, relating to the handling of claims for back pay.
2) Like so many other aspects of the Court’s work, this one does not fit well into simplistic accounts from some quarters about the Court’s supposed “pro-business” stance. In many circumstances business defendants actually prefer some degree of collectivization of claims, because their main practical concern is to put an end to litigation, and group resolution can do that. In the Court’s landmark 1997 Amchem Products v. Windsor decision, six of eight voting justices (Breyer and Stevens dissenting in part) struck down a giant batch settlement of asbestos litigation that had been ardently pursued by many of the nation’s biggest businesses, as well as many plaintiff advocates, on the grounds that it improperly denied claimants their right to individualized justice.
3) If the question is one of faithfulness to the constitutional vision of law held by the Founders, there really isn’t much of a question: like other Anglo-Americans of Blackstone’s era those Founders saw the courts as dispensers of individualized justice if they were to be anything at all. Much else in American law has changed beyond recognition in the intervening two-plus centuries. Fortunately, as the result in Wal-Mart v. Dukes suggests, that hasn’t.
For more commentary on the Wal-Mart case, check out (e.g.) editorials at the Washington Post, New York Daily News and Omaha World Herald (favoring the court’s view), and the New York Times and USA Today (opposing), as well as my contributions in the Philadelphia Inquirer and at Overlawyered.
One Generation of Oliver Wendell Holmes, Jr. Is Enough
Today, the Charlotte Observer reports on the ongoing attempts to find restitution for the 3,000 living North Carolinians who were victims of the state’s forced sterilization program. It may surprise many readers, but forced sterilization has a long and shameful history in the United States. In North Carolina, the last forced sterilization was performed as late as 1974.
The most famous case of forced sterilization was the 1927 Supreme Court case of Buck v. Bell. Carrie Buck, a “feeble minded” woman from Virginia who was deemed the “probable potential parent of socially inadequate offspring,” challenged the state’s attempt to forcibly sterilize her. In an opinion that even his colleagues called “brutal,” Justice Oliver Wendell Holmes, Jr. curtly did away with Buck’s pleas, ramming home his decision with one of the most heartless and ignominious lines in all of the Supreme Court history:
We have seen more than once that the public welfare may call upon the best citizens for their lives. It would be strange if it could not call upon those who already sap the strength of the State for these lesser sacrifices, often not felt to be such by those concerned, in order to prevent our being swamped with incompetence. It is better for all the world if, instead of waiting to execute degenerate offspring for crime or to let them starve for their imbecility, society can prevent those who are manifestly unfit from continuing their kind. The principle that sustains compulsory vaccination is broad enough to cover cutting the Fallopian tubes. Three generations of imbeciles are enough.
Amazingly, Justice Holmes’s original draft of the opinion contained worse language. He later wrote to Harold Laski that he was “amused” that his fellow justices suggested rhetorical changes when he “purposely used short and rather brutal words… that made them mad.” Nevertheless, despite his desire to use crueler language, Justice Holmes was satisfied with himself, once telling a friend, “One decision that I wrote gave me pleasure, establishing the constitutionality of a law permitting the sterilization of imbeciles.”
It has continually fascinated me that Buck v. Bell seems to be rarely found on the short list of worst Supreme Court decisions. Dred Scott, Plessy v. Ferguson, and Korematsu (the case upholding the internment of Japanese-Americans during WWII) are nearly household terms used to describe the height of Supreme Court folly. But if Buck is among the rogue’s gallery of Supreme Court opinions, it certainly isn’t higher than Lochner v. New York. The term most often used to describe Supreme Court error is to “Lochnerize.”
As Cato adjunct scholar David E. Bernstein explains in his wonderful new book Rehabilitating Lochner (co-published by Cato and the University of Chicago), Lochner v. New York is hardly an instance of blatant judicial senselessness. It is likely that the law overturned in Lochner, which limited bakers to working 10 hours a day or 60 hours per week, was partially the result of large, automated bakers trying to protect themselves against small, family-run bakeries. But in his famous dissent in Lochner, Justice Holmes accuses the majority of trying to enact their preferences for laissez-faire capitalism rather than understanding that a justice’s “agreement or disagreement [with the law] has nothing to do with the right of a majority to embody their opinions in law.”
While Justice Holmes seems to have taken his deference to unlimited majoritarianism to new heights in Buck v. Bell, he actually endorsed eugenics as a policy. Holmes once wrote Laski that, when he delivered the opinion in Buck, he felt he was “getting near the first principle of real reform.” It seems Holmes was the one trying to embody his opinions into law.
And whereas recent historical examinations of Lochner have done much to rehabilitate that infamous case, Buck v. Bell just keeps getting worse as historians learn more. Paul Lombardo has spent decades on the case, publishing “Three Generations, No Imbeciles: New Light on Buck v. Bell” in 1985, and most recently giving his research a book-length treatment in Three Generations, No Imbeciles: Eugenics, the Supreme Court, and Buck v. Bell. Lombardo has discovered that Buck’s prosecution was the result of a collusive attempt to validate Virginia’s sterilization law. Her lawyer not only endorsed the law, but he mounted a deliberately insufficient defense.
Perhaps worst of all, Carrie Buck was not an imbecile. Both she and her mother were deemed “social undesirables” due to a perception of promiscuity which, in Carrie’s case, partially resulted from an illegitimate child who was the product of incestuous rape. This was fairly typical. The linked article describes how “people as young as 10 in North Carolina were sterilized for not getting along with schoolmates, being promiscuous or running afoul of local social workers or doctors.”
In all, more than 60,000 people—including 7,600 in North Carolina—were forcibly sterilized in the United States in the name of “progress.” Progressives of the time lauded the decision in Buck. Individual rights, they firmly believed, should not be allowed to stand in the way of collective progress. Justice Brandeis called Buck an example of properly allowing states the freedom to “meet modern conditions by regulations which a century ago, or even half a century ago, probably would have been rejected as arbitrary and oppressive.”
We should not forget the tragic consequences of such thinking. Hopefully those in North Carolina will receive some restitution for their plight—a plight that could have been avoided had Buck v. Bell been decided correctly.
Sen. Scott Brown, the SBA, and Discrimination
I recently testified before the Senate Small Business Committee on the topic of the Small Business Administration. GovExec.com mentioned that there was a “bit of drama as the hearing ended” when Sen. Scott Brown (R‑MA) “upbraided” me for comments I had made in an exchange with Sen. Rand Paul (R‑KY). Having watched a recording of the hearing, I think I should comment.
Proponents of the SBA argue that a “market failure” exists because some otherwise worthy applicants are unduly denied credit under the standard criteria used by private lenders. Therefore, the federal government should correct this alleged “failure” by incentivizing private lenders to issue loans to less credit-worthy applicants. The SBA does this by “guaranteeing” up to 85 percent of the loan’s value in the event of a default.
Sen. Paul asked me to comment on the alleged “market failure” in small business lending. In my response, I stated that the SBA’s loan guarantee programs are “inherently discriminatory” because the government backs loans for some businesses but not others. I noted that businesses that do not receive an SBA-backed loan are put at a disadvantage when the government backs the loan of a competitor.
In an attempt to simplify my point for the audience, I gave an example. Upon moving to the Indianapolis area several years ago, I went to a pizza shop. On the wall was a newspaper clipping about the shop, which mentioned that it had gotten started with an SBA-backed loan. There are innumerable places to get pizza in the Indianapolis area. So it struck me as being unfair that the federal government had assisted a particular pizza shop and therefore advantaged it against competing pizza shops that did not receive government support, or pizza entrepreneurs who might have entered the market without government support.
A visibly bothered Sen. Brown claimed that I said that “I wondered how they [the pizza shop] got the loan.” However, I never said that I wondered how the pizza shop got the SBA-backed loan. I thought that my anecdote illustrated a very simple point: the government had effectively favored one pizza shop over others. But Brown apparently didn’t get it, and instead proceeded to question how I could talk about discrimination when I knew nothing about “the facts” of how the pizza shop came to get the loan.
The entire exchange was bizarre – particularly Brown’s closing comments before he cut me off (my transcription):
I find it kind of inappropriate that you would make a statement as discriminatory for that pizza place to get a loan without having the facts … and I think this kind of rhetoric like that as you throw it around … and we hear those things in a whole host of areas in Washington … it doesn’t help solve the problem and basically step up, and you know, make it better and encourage people to take a shot in business.
Maybe it’s best that he cut me off because the hearing was a week ago and I still don’t know what to make of those comments. (Those interested can go to the 122 minute mark to watch my full exchange with Sen. Brown.)
Perhaps my use of the word “discriminatory” got Sen. Brown agitated. I admit that if I could do it over again, I would chose a different word or phrase given that the ruling class in Washington is particularly sensitive when you’re on their turf. Regardless, it’s a sad commentary on the size and scope of the federal government that I would be arguing with a senator over federally-backed loans to a pizza shop.