Russ Roberts

Epstein on the Constitution

EconTalk Episode with Richard Epstein
Hosted by Russ Roberts
PRINT
Frakt on Medicaid and the Oreg... Jim Manzi on the Oregon Medica...

Richard Epstein of New York University and Stanford University's Hoover Institution talks with EconTalk host Russ Roberts about the U.S. Constitution. Topics covered in this wide-ranging conversation include how the interpretation of the Constitution has changed over time, the relationship between state and federal power, judicial activism, the increasing importance of administrative agencies' regulatory power, and political influences on the Supreme Court.

Size: 28.7 MB
Right-click or Option-click, and select "Save Link/Target As MP3.

Readings and Links related to this podcast

Podcast Readings
HIDE READINGS
About this week's guest: About ideas and people mentioned in this podcast:

Highlights

16:41
Time
Podcast Highlights
HIDE HIGHLIGHTS
0:33Intro. [Recording date: May 3, 2013.] Russ: Our topic for today is the Constitution, and I want to start with a very broad overview. How has the role of the Constitution changed in the United States since the founding? How has our understanding of it evolved, good and bad? And that, of course, we could spend 7 or 8 hours on, but why don't you open us up with a general overview of the biggest trends. Guest: The biggest trend in the Constitution has to do, I think, with the change in Federal and state relations from the time of the Founding. The point here is that the Bill of Rights was not wildly important in terms of judicial action for a very long period of time, and that the major battles therefore were over the structure of the Constitution. And the issue was driven in large part, although it's often forgotten today, by the slavery question. The central feature of the great compromise that brought the United States together was the decision to allow the southern states to keep with their slave traditions and the northern states to keep with their abolitionist traditions, to the extent that they had them. In order to make this work, what you had to do is to limit, very powerfully, the ability of the Federal government to regulate activities that go within the states. And so at that particular point what happened is, you give the Federal government the power to regulate foreign commerce, which essentially allows it--not for the best of all possible reasons--to introduce protective tariffs, which were championed first by Alexander Hamilton, later by Joseph Story, and you give it the power to regulate commerce within the states--that is, transportation going back and forth between states. And also to deal with the very tricky questions of the relations with the Indian tribes. And the rest of it was supposed to be inside the states, with the state police power[?]. When you look at the Judicial System, it was also pretty much the same kind of arrangement. There was to be one United States Supreme Court to review various kinds of decisions. But it in turn was checked by a Congress which could limit the kinds of cases that it could take. And it was also very unclear at the Founding as to whether or not there was anything that the Federal government at the center could do in order to override the decisions of state courts which invalidated certain kinds of laws on Federal constitutional grounds, or more importantly, upheld them against challenges that were based on Federal constitutional grounds. So that what you did in effect was you had an institutional design which was intended to marginalize the Court in its original foundation, and to leave primary power in the federal legislatures and the President and the state legislatures and the state governors, as the case would be. And so, you have that as kind of a key feature with respect to the original constitutional design. There is also the question about what is the role of the Executive. And for the most part, the United States wanted a single executive with great power to execute but little power to create law. And so what they did in effect was to create a system in which the President--and it was the single President--had the powers of a commander-in-chief, had the powers to veto various kinds of legislation, had the power to pardon various kinds of individuals, and was charged with duties like making reports to the Congress like the way in which things went. But if you put the whole system together, the basic way of understanding it was that the Constitution was drafted as a way to get rid of the defects of the Articles of the Confederation, rather than to create the modern welfare or New Deal state. And so they had the President, which the Articles of Confederation did not have; it had a Congress with the power to tax, which the Articles of Confederation did not have. It did have a Federal Judiciary, which the Articles of Confederation did not have. And so what you did in effect was you found a way to get greater degrees of centralization, but the trick was to go far enough to allow the nation to operate as a coherent whole, but not so far as to allow it to squash the individual variations that took place within the states. That's the original design. By the time you get to the modern period, everything starts to change. The separation of powers at the Federal level is looked upon with a great deal of suspicion. And we see the rise of the administrative state. Uh, the notion of enumerated powers, particularly with the Commerce Clause, giving the Federal government only a limited ability to control the way things go within the state, is scrapped in favor of a system of concurrent jurisdiction, where basically on any kind of important economic issue, it turns out that the Federal government is entitled to act. And in its absence, the state government is entitled to act as well. But the earlier version--this is federal, that's state, and never the twain shall meet--was never in fact kept after the 1937 period. So it's a huge difference between a relatively lean classical state--small government, strong property rights--to a law state with heavy administrative law, concurrent jurisdiction. And lots of discretion that's being given to agents at all levels of government. So it's a really very, very big change that took place.
6:03Russ: Now, you talked about the rise of the administrative state. Explain what that is, the 'administrative state', and when that rise occurred. Why did that happen? Guest: Well the 'administrative state' is not simply a state which engages in administration. I mean, every state has to have tax rolls, property rolls, voting rolls, public highways, and so forth. The 'administrative state' refers to the conscious effort on the part of government, to believe that essential industrial and academic--actually not academic--essentially industrial and manufacturing, commercial functions, or to be subject to a very strong degree of oversight by professionals. And these professionals are supposed to have the kind of scientific expertise that would allow them to manage an economy. And the general constraint on them would not be a system of freedom of contract in private property, but would be the political oversight that takes place by virtue of general popular election. Uh, the way it started was of course gradual, and the first area in which something was clearly needed, or people thought, had to do with the creation of a railroad industry. A network industry that went from one end of the country to the other. And so for the first time what you did was you saw heavy capitalized firms dominating industries, which were at a multi-state level. And the question of how it is that these things were to be regulated became a great challenge. So, in the mid-1880s, the Supreme Court case of Bobby[?] and the Wabash Railroad, sort of indicated that, you know, states could under certain ways, bond--control certain things that take place in their jurisdiction. And then when these decisions made it clear that there might be fragmented control over interstate railroads, in 1887, the Interstate Commerce Act was put into place. And this gave your first system of Federal regulation--the control over rates that railroads could charge. It was in fact quite an ingenious scheme. Because what it was designed to do was inverse the long-haul/short haul inversion. It's very common when you are dealing with network industries. So there are four railroad lines that run from San Francisco to Chicago, and they compete furiously for business. There is only one line that goes from Omaha to Kansas City. And so what happens is it's not a cost-based system of pricing. It's essentially a system which says you load all of your costs of the fixed network onto the smaller portion. So you are paying more to go from Omaha to Kansas City than you do to go from San Francisco to Chicago. And this enraged a lot of people, who didn't understand that this was a form of Ramsey pricing, which means that in effect you put the fixed cost of the system on the inelastic portions of the overall operation. Because otherwise you can't fund it. And so what they did in order to counter that was they required you to price the shorter portions on any individual leg at a price that was at least as great, rather, no greater than the price of running the long haul. So, they tried to control this long-haul/short haul thing. And then slowly what happens is the power to regulate the railroads expanded, so by the 1920s, what you did is you had a comprehensive system of rate regulation, and instead of trying to control these kinds of weird price reversal, what happened is that you now had a cartelization of the industry, courtesy of government. When the Progressives then take over again in the first part of the 20th century, we start to see the creation of the Federal Trade Commission. And this is, again, a very large administrative agency, and a very lot of what it is designed to do is to regulate trust-busting type activities--the Sherman Act had come on board in 1890 and the Clayton Act, which is expanded, it came on in 1914 with the Federal Trade Commission. And what happens is that the model is: Congress gives the broad outlines and the agency fills in the gap. And sometimes it's an anti-fraud device or a consumer protection device. Sometimes it's a trade practice device that's going to be regulated. And so what you do is you see more and more perception on the part of people in government that markets fail for informational reasons, monopoly reasons, whatever. And they want bigger and bigger regulation.
10:10Guest: So this continues on a regularly steady trend until you get to the 1930s, when it mushrooms with the creation of so many of the major agencies that we have today. Russ: Let's stop there for a second. When we look at that trend--and you earlier identified 1937 as something of a turning point--there's a temptation to say: Well, we're in the middle of the worst economic downturn of American history, the Great Depression. [?] lost in markets; people naturally turn to the government for solution. But in fact these trends had been building for some time. And certainly the Progressive Movement, which--I don't know when it started, maybe late 19th century through the 1st-- Guest: About 1900. Russ: Yeah, about 1900. You get this view, at least this is the story, you get this view that now there is this cadre of experts of people who are clamoring to be expert about and who are lobbying the public and the intellectual class, who are very amenable to this idea that experts should have more power. So, this expansion during the Roosevelt Administration isn't so much a--in this view, isn't so much a counter-revolution to the, excuse me, a response to the Great Depression, whatever. It's rather just the building up of a lot of underlying forces that pushes in that direction. What's your view on that? Guest: Yeah. I mean, 1937 is in fact an extremely important date. Because it represents the final culmination of a movement that has been building for 40 years, on two dimensions. One on the Federalism dimension. It became pretty clear that there was virtually nothing with respect to comprehensive economic regulation. That was beyond the scope of Congress to regulate. Whereas beforehand it was actually quite different. You still had the older view that Congress could regulate interstate journeys, so that if you shift something across state lines in a truck and then you unload it and put it in a car, the truck would be in interstate commerce and the car would not. And by the time you get to 1937, all of the earlier concerns about slavery of course long gone, and now you could regulate whatever you want by way of manufacture, mining, and agriculture within the state, which meant that the Federal governments could really prop up labor cartels, from the National Labor Relations Act, and agricultural cartels, with the Agricultural Adjustment Acts, which were passed repeatedly in the 1930s, harkening back to an earlier period when these things were first introduced under Wilson. Who was of course a transformative, progressive president. But in the interim there are people like Herbert Hoover, so you get the Federal Radio Act in 1926 which is under the control of the Department of Commerce, which Hoover headed. And you see an expansion of government power there. Hoover also organized--it's interesting to remember--a conference which was designed to deal with zoning within states; and they proposed a uniform zoning law which became quite influential. And zoning was sustained as a constitutional matter in 1926, having been introduced as a legislative matter in New York City some 10 years before. So you see this pattern building up. And there is resistance by the old Court; there is reluctance on the part of various people in the Federal government to go the last 9 yards. And then when Roosevelt takes over and the 1937 Court transformation takes place, what's clear is that the progressives have dominated everything, and then, boom, a year later, we have to worry about race; and it's all of a sudden very clear that this model of complete government control and a lot of state power and a lot of Federal power is not going to work very well in the face of systematic segregation in the South. And so you get another permutation, from 1938 through 1954, where eventually in Brown v. Board of Education the Court acted as the super-est of super-legislatures when it struck down the whole state system of segregation, after having decided that it's just absolutely terrible to strike down a minimum wage or a maximum hour law. Constitution law does have this way of having strange twists associated with it.
14:12Russ: So, what you are saying, if I read you correctly, is that the natural--I'm going to phrase it in a little hyperbole--the natural trend toward Leviathan, which is implicit in any coercive power, monopoly coercive power of the State, was actually restrained, ironically, by slavery and the need for the original Founding to show a respect for state authority that was easily ignored once the slavery issue was gone. And that that's the trend we're still riding today. Guest: It is very ironic. But it's quite clear that the cause of limited government was advanced by the institution of slavery, because it made Federalism a very important issue. Just the way in Canada it's an important issue because of the differences between Quebec and the English-speaking provinces that lay to the west. Russ: Explain 'Federalism'. A lot of people find 'Federalism' to be an awkward term. Federalism means--explain it. You would think it would mean the power of the centralized state. That's not what it means. Guest: No. It means almost exactly the opposite. A Federal system, as opposed to a unitary system, is best understood by going back to the Articles of Confederation, dropping the first syllable. And 'federated' means loosely affiliated, one through another, so that you are not dealing as strangers but on the other hand you have separate relations, separate governances with some degree of comity or cooperation between them. And the so-called Full Faith and Credit Law, whereby each state promises to give respect, full faith, and credit to the judicial decisions and the legislative actions of other states is a classic illustration of how Federalism works. So, what happens is you enter into a judgment against x in State Number 1, and that guy disappears to State Number 2, you want to go in and enforce that judgment in State Number 2 as the winning plaintiff in the first case. And the state, by having to give full faith and credit to it, means it can't say: Gee, we want to relitigate that case in our particular jurisdiction so we can be sure it gets right. And so federations in effect are loose alliances among states. And it's more complicated here because you've got the Federal government on top of it. So you have, in Federalism, to worry about state-state interactions and then Federal pre-emption or domination of things that the individual states can do.
16:41Russ: So, let me ask a naive question, which I don't know the answer to. It's the kind of question my 14-year-old has been asking me lately; and we're going to get to him later, maybe. He's got a lot of questions that I don't know the answer to; it's partly why you are on the show this week. Guest: [?] Russ: Isn't it exciting? Now if a state, a particular state, passes legislation that violates the U.S. Constitution, or might be thought to--and we have a lot of experiments going on right now in social policy areas, marriage issues, drug issues--what's the legal issue there? What is the ability of a state to carve out its own set of legislation, that follows its own constitution but not the Federal one? Guest: Well, if you go back to the pre-1937 issue, [?], what becomes clear is that there's a lot of room for experimentation, not all of it good. So the most famous use of that particular metaphor about experimentation comes from a 1932 case, and it's a dissent by Louis Brandeis, a case called New Ice against Leibmann, in which he says that the laboratories are essentially the places--the states are laboratories in which we can have experimentation going on. And it's kind of like the trial-and-error mode of scientific inquiry: this state seems to make it work, that state doesn't; the one state that fails will imitate the one that does good, and by having these multiple experiments running simultaneously, you get a way to compare and to contrast. And that, in effect, is an effective constraint on limited government. The problem about that is that sometimes you know these experiments are failures even before they are tried. And in the case of the New Ice Company, what happened is the state, I think it was Oklahoma, which sort of announced that hey, we are going to have a cartel created for the sale of ice inside this state. An ice cartel. And, you know, you are trying to figure out why it is that you'd want to do this; and the only explanations that come up are forms of political influence and naked economic protectionism. And that was the thing that our friend Brandeis was defending. And the majority of the Court said, this is the kind of thing that the Federal Constitution doesn't allow, and it struck it down. And this is what the complication is. After the Civil War, it was widely understood that there were too few Federal constraints on what states can do. And this, of course, is the obvious consequence once you decide to strike down slavery. So what they did is they passed the 14th Amendment. And the way to understand it is as follows. What it does is to guarantee people fairly extensive rights. There is something called the 'privileges or immunities clause' of the 14th Amendment, which says, categorically, no state shall make or enforce any law that abridges the privileges or immunities of the citizens of the United States. And 'no state shall make or enforce any law'--this is a huge prohibition on what states can do. It's a kind of a veto power. And it's to be enforced mainly from Congress by appropriate legislation. So the Federalist system changed after the Civil War. And what was thought was that you'd have state initiative only, but you have Federal veto power. But what you did not have under the 1868 situation, where it was that the Federal government could initiate those kinds of rules that the state had to follow. That came only in 1937. So, the original version was: You states can do all kinds of things, but we've got this Constitutional protection out here so that you cannot engage in various kinds of dangerous activities. And the basic argument is this: Federalism is good because it creates tax competition; Federalism is bad because what it does is it creates land-use monopolies that the state can easily control through zoning regulations or entry restrictions of one sort or another. And the cleverness of the 1868 solution was it was an effort to have Federal vetoes over bad sorts of state acts while allowing the good state acts to continue to go more or less as they were. So experimentation is certainly not a bad thing. So, for example, one of the things that you discover is, you take states like, um, Illinois. Or Massachusetts. Still governed states. They have flat tax Constitutions, which makes a huge difference compared to places like California and New York, which don't have those things. So, you know, experimentation on tax rates, I can understand where that comes from. But experimentation in the form of entrenching local monopolies is the kind of thing that you would like to strike down.
21:12Russ: Well, you were talking about the administrative state and I derailed you. I want to come back to that for one more minute. Given the expansion of the administrative state in our time, where we have agencies like the Environmental Protection Agency {EPA] and the Federal Communications Commission (FCC) and the Federal Trade Commission (FTC), they have much larger roles in implementing legislation. And the legislation is much broader and more ambitious. And it's inevitable, it seems to me, and in the current situation, because of the complexity of these regulations, that they have to work very closely with the industries they are regulating. Which opens up the possibility of regulatory capture. I know that the ideas behind these agencies are lovely--cleaner air, better air waves, more access. But how can it possibly be a good thing that this communication--and I'll add the financial sector to it as well. My voice, as Mr. Citizen, seems to be very quiet, given how much time the regulated industries must spend in the halls of power. What's going on there? Guest: Well, it's actually even more complicated than that. Your voice as a citizen is indeed ever [?] least subdued, but it would be a mistake to think that the regulatory capture model works unambiguously in all cases. The way this system is in fact organized, the people who wish to veto various kinds of actions are often given enormous kinds of power. So that what happens is you have an Environmental Protection Agency and you have the industry groups that are lobbying for relaxation of certain pollution controls, but at the same time there are well-organized environmental groups of one kind or another which are constantly suing the Agency in order to make sure that they impose even stricter restrictions on what's going on. So the Natural Resource Defense Council, whatever these organizations are called, are always very, very active in this kind of fray. And it's always very indeterminate as to who is going to win those kinds of struggles. First of all, the agencies themselves are often quite conflicted. Many of the people who are appointed to the agencies are not what you would call 'friends of industry.' Nobody would say, for example, that the leadership under the Obama Administration on the Environmental Protection Agency was pro-industry. The industry people lost most of the major battles with respect to that. So, there's a kind of indeterminacy at that level. The second point is that the issue about capture is not sort of an inevitable by-product of a well-organized scheme that somehow gets derailed. It is actually built into the statutes themselves. The most famous illustration of this has to do with the charter that was given to the FCC, which is created first by the Radio Act in 1926 and then it gets expanded jurisdiction in 1934 and it becomes the Federal Communications Act. And the administrative agency was delegated the power to make all rules and regulations necessary to advance the public interest, convenience, and necessity. Now, you mentioned that obviously we need the system to make sure there's no spectrum interference going one way or another, and that's absolutely correct. But the agency in fact by the courts took a much more aggressive view of the situation. And in the famous phrase of Felix Frankfurter in talking about this in the 1943 decision involving NBC, he said: It's quite clear that the function of the agency is not only to set the rules of the road--that is, to prevent interference on the frequencies, but it's also to determine the composition of the traffic. So that when you start to see the lobbying that comes on in this particular case, don't think of it as simply a question of abuse at the agency level. Think of that one at least as a very serious defect in the design of the system at the Constitutional level; at the Congressional level, when they didn't take the sensible position, which was to figure out how to assign frequencies that are consistent with one another and then auction them off to users for their hired use, that was a major Congressional decision. And it is perfectly consistent with their view that these experts in government are entitled to do all sorts of other things and to simply confine them to use the 'night watchman state' to use their own terminology would be a desperate error. So, what you do is you see the administrative agencies responding to the Congressional commands, and the Judicial system, which is not particularly convinced about the merits of a property system anyhow, accommodating them up and down the line. So it becomes a very, very erratic position; and it's extremely difficult, therefore, to generalize from one administrative scheme to another. Indeed, to generalize between one portion of the jurisdiction, the statute, to another. So the rules that govern, for example, the roles of air pollution under the EPA are very different in design and impact from the rules that govern water pollution. And it takes a very brave soul to be able to make jumps from one kind of organization to another. So, it's a really very complicated situation. And just like the Federalism situation, it's not just there's a tendency, one powerful push that leads to regulatory capture. What is unleashed is a whole series of initiatives by private and public parties alike which are constantly at war with one another, and you don't know the initial positions of all of the players, and therefore it's almost impossible in advance to predict what the outcomes will be. And it's also extremely difficult to know whether the courts are going to get their noses up with some of what these agencies do, or whether they are going to basically be highly compliant. So the [?] can only be described as expensive and chaotic. Russ: There's one other word I would add, which is 'non-transparent.' Guest: Oh, that, too. Russ: And the lack of accountability--if things don't go well--basically we're relying on that--not internecine, I was going to say 'internecine conflict'--it's wrangling, that takes place behind the scenes with the administrative court system. It's a bizarre way to run a country, which certainly isn't the way it was a while ago. But it's the way it is now. Guest: Yeah, but Russ, it's ironic. You used the word 'transparent,' and it's lack. The way in which we've achieved non-transparency is to publish so much information before any one of these particular proceedings take place, and nobody can figure out what it is that's going on. You get this outpouring of papers and stuff, and then, since nobody can assimilate it, what happens is the serious work is done behind closed doors. So you do get a nod toward transparency, but Lord knows how the sausages are made, to quote this book.
27:51Russ: In a recent episode of EconTalk I interviewed Louis Michael Seidman, who had argued at the time in an op-ed, and I think it's based on his book, that we should just ignore the Constitution; it makes no sense to be beholden to a bunch of dead people who lived hundreds of years ago; they don't know anything about what we're doing; it's bizarre that we constrain ourselves that way. What was your reaction? I know you had one. Shockingly. Shockingly a negative reaction. Guest: Well, my reaction was negative. I was by no means alone. I don't even know what it is to ignore the Constitution. Do we start to say, in effect, that people can disregard the judgments of the Supreme Court? Does it mean in effect that when Congress passes a law by say, less than a majority vote, that we are going to so: Oh, 40% of the people are in favor of this in the House of Representatives, it's now a law? Certainly he doesn't mean all of that. The question is just: What does he mean? He was certainly in favor of giving certain kinds of protections for the 1st Amendment--speech. Well, that's got to be Constitutional and that's got to be enforced. There is a movement on the Left, of which Seidman is a part; his former colleague now at Harvard, Mark Tushnet, is a part; Larry Kramer, who is the former Dean of Stanford Law School is a part--which says that what we have to do is to return to the principles of popular democracy, in the way we elect public officials, is clear enough, but also in the way in which we pass our laws. So that for the most part whatever comes out of the Congressional or the state mill, if it is a reflection of "the will of the people", then the courts ought to yield to it. Because otherwise, to use Kramer's famous phrase: Instead of having 'we the people' what we do is we have 'we the court' deciding things. My own view about this is I just think it's much too crude. There is no question that any appropriate constitutional theory has to be able to find a series of structural constraints that existing legislatures are not in a position to avoid. But on the other hand it has to give them sufficient power so as to be able to make sure that you can upgrade a government to deal with the technical and the legal and the moral challenges, and the international challenges, of a [?] age. The issue that you'd want to then ask is just exactly how it was that the folks in 1787 did[?] understand that exact precise dilemma and whether or not they picked the series of institutions and rules which actually gave you the needed flexibility where it was required but gave you the needed structural regularities where that was required as well. So you have to be able to figure out whether or not they did a good or bad job. So, for example, I think that the old device, wholly apart from the slavery question, of having competition between states in the organization of such general policies on such things as taxation and then having the Federal government with the power to make sure that no state could blockade trades across state lines, that's a kind of a structure that works very well in the age of the Internet, the airplane, the railroad, as it does in the horse and buggy stages. So that I don't think there was anything whatsoever wrong with that original structure of enumerated powers. And that the risk of factions, which later becomes the risk of public choice captured is in fact one that was real in 1787 and it's one that's real today. So, if you look at the Constitution and you sort of ask yourself which of its provisions seem to have durability that outlast the time of their creation, I would say a very large fraction of them do. And the ones that clearly did not--the three-fifths clause on racial voting and the fugitive slave provisions that dealt with the duty to return escaped slaves to their owners and so forth--those things are all gone. Does this mean that we have a perfect Constitution? No. But ironically, if you then start to figure out what some of the great achievements are, it's actually through more Judicial intervention rather than less. Let me give you one example. If you look at the Constitution on this key question of interstate trade, it says: Congress shall have the power to regulate trade amongst the several states. And what typically happens is Congress doesn't regulate trade very much amongst the several states. And what the states then try to do is to create all sorts of barriers to make it more difficult for merchants out of state to compete with local people. And what the Supreme Court has done under the so-called 'dormant' commerce clause, it has basically inferred that in the absence of Congressional legislation, it is its duty to essentially make sure that we preserve the basic outlines of a competitive economic union, much the way the early economic union was in Europe. So that states cannot impose differential barriers on foreign trade and commerce, or foreign merchants coming inside the state, so as to create a nationwide common market instead of having a Balkanized market with either 13 or 50 states. It's been a great intellectual achievement. They make it very clear that this doesn't allow you to admit poisons into the rivers of another state or to introduce native wild species into a particular community which will kill all the local fish and habitat. Essentially what they did was they invented a classical liberal doctrine. Now, if you take Seidman seriously, then presumably you are going to go back to the kind of state relationships which essentially allow you to have this provincialization take place. I can't think of anybody who would really want to do that. You are going to get rid of judicial review; you are going to have to say: Gee, well really shouldn't the people in the state of South Carolina decide whether they want to continue with segregation? And by the way, why don't we want to have any Federal oversight or Constitutional oversight over who is allowed to vote in state elections and so forth. So, it becomes almost grotesque to put this forward as a general concern. And the correct way in which to do it is to break it down into smaller questions and say: is this an area in which you think, either as a matter of existing Constitutional law or as a matter of general constitutional theory, that the courts have gone too far? And you know, take one case where that's arguably so: Should the Federal government, or should the Federal courts, the U.S. Supreme Court, have the power to tell states how to organize their prison systems? And I certainly think that the Constitution has gone way too far in an area that Seidman might be in favor of, which is the ability under the so-called 'cruel and unusual punishments' clause to essentially say that it is no longer permissible in the United States to execute somebody if it turns out that he's guilty of child rape. There are all sorts of normative judgments that the Supreme Court makes on capital punishment which bear no relationship to the judgment of 'we the people'. And yet somehow or other I don't know whether or not Seidman thinks it's a bad thing or a good thing. I think that's a case of judicial excess. But on the other hand, allowing a zoning law which confiscates property effectively to pass unchallenged I think is a sign of judicial abnegation. So I just don't see this one-directional situation on any relevant issues, which allows me to say there's too much court or too little court. I take this at a retail level, not at a wholesale level. Russ: The problem I have with it, with the formulation you gave, the Kramer formulation, is that this idea that there is such a thing as the will of the people is a bizarre intellectual concept to me, since most of us don't agree on many things. And any attempt to aggregate our preferences is inherently imperfect. And that aggregation should only take place when it's absolutely necessary or a strong improvement, because most of the time it's a way to redistribute among people.
35:20Russ: But let me give Seidman his due and challenge you. He makes a good point, I think, that the Constitution only constrains legislation and behavior infrequently in the modern era, and maybe it would be better to be more honest about its real role in our lives. So there's certain areas--the First Amendment, I think, and that's why he likes it--I'm a fan of it, too. Second Amendment, I think he's also a fan of that also. But we can disagree about which are the good amendments, which are the bad amendments; but I think--am I wrong in saying that there are only a few of them that really matter? That most of the time, whatever Congress wants to do, it does anyway; and we just go along. To quote my--he's actually 15; I misspoke; he got a year older while we were doing the podcast--but my 15-year-old says: Why is marijuana illegal? Why is that Constitutional? Or trans fats in New York City? You name it. What gives the government the right to stop me from eating or consuming what I want to consume? Most people just say: Because it's good law. But we don't really use the Constitution. In a way, Seidman's vague idea that, well, if it's good, if people like it, that's what we should do; we shouldn't be constrained. You think that's true? Guest: Well, in spite--I mean, look. One of the things that people don't know whether they want the courts to intervene or to back off. And the cases that you've given, you would love to have a judicial decision that says it is not within the competence of the state in the exercise of its police power to tell you what you can and cannot eat. What it's supposed to do under its police power is to make sure people don't get killed in street fights and to make sure that poisons aren't circulated throughout the system. But if you have ordinary food and there's an issue of overconsumption, that becomes an individual matter rather than a collective matter to solve. Well, that's an argument that means strong constitutional interventions, not for having weak ones. So, your son is on both sides of the issue. As is everybody else. One of the great things that happened with the Kelo case was that the Supreme Court said that you are taking land for public use--you are going to transfer it from one private party to another. And most people said: This is the most outrageous form of judicial activism. But it was exactly the opposite. It was a situation in which the Court knew that this was not a public use transfer, and nonetheless said it's up to the state to decide whether or not to allow it. And they should always make it for public use because every transfer will have some indirect public benefit. Well, if that's the test and every transfer has the limitation that is de facto read out of the Constitution. So people who get indignant about this, often whenever they don't like a decision, they call it judicial activism, even when they are cases of complete judicial passivity. So again, I'm just going to repeat what I think to be the case, which is that what we need to do is define imparticularities[?]--where courts should intervene and where not. So let me just give you one simple example: What do you do with tax base[?]. Well, I think it would be absolutely crazy for somebody to say: Well, the U.S. Constitution means, a. that the average tax level can never be more than 4% no matter whether you are at war or at times of peace. That would be crazy. Or that the total budget that could be spent for all times could never be more than a billion dollars. There is a $20 provision about jury trials in the Seventh Amendment of the Constitution. But I think it's perfectly sensible for somebody to say: look, under our Constitution if you want to eliminate the kinds of political discretion that can eat you alive, what you have to do is to have a broad tax base and the tax rates have to be flat. And if you did that it would be a complete transformation of modern American politics at the Federal level. Just think of what would happen in the debate about the top 1%. You could no longer have it. You would be in the same position that Illinois and Massachusetts, both ill-governed states, are with respect to this. That's a judicially enforceable limit; it makes a big difference; and it does not trench upon your ability to raise whatever revenues you think you need in order to discharge the important functions of the day. So, that's a classic case in which, on the matter of rate, it seems to me you would want to have complete Congressional control but on the matter of rate structure, you would want very strong Judicial control. That's the same very issue. So to kind of argue that I'm in favor of restraint or I'm in favor of Judicial restraint or Judicial activism becomes idle[?]. You can disaggregate. Figure out how in accordance with general principles of political theory you give people enough discretion to run the government but not so much to run it into the ground. Which is what we are doing today. Look, you know as well as I do, Russ: there is no major tax rate currently in place which has a half-life of more than two years. They all get changed. And they get changed in terms of the intensity, the progressivity, the kinds of taxes we impose or whatever. So, we had a compromise just this past year in which we raised the estate tax up to $5 million and then give a cost of living increase, and now it turns out the President comes back and says: I don't like that; let's go back to $3.5 million dollars and a higher bracket for taxable stuff. So, his attitude is: I conceded on this point in 2013 in the beginning of the year, and now I'm perfectly okay that we can pass a statute so that by 2018 or 2017 it goes back into a position that is radically different from the one that we have. How do people plan against that kind of erratic behavior? Russ: That is a problem. I'd certainly prefer a more stable tax environment, and I'd prefer a flatter tax environment and a broader based tax. And a more transparent tax system where we don't have this weird payroll tax thing, that people think is for their old age, but their other Federal activities get funded out of the income tax when in fact they both get pooled together. There's a lot of problems.
41:02Russ: But let me ask you one other followup to this Seidman issue that come up, which I thought was very provocative, which is--I'm not sure how it came up, but it's something I think about a lot--which is that we have this romance about the Court, that members of the Court have these philosophies. We have these people with strict constructionist views, we have people with more progressive views, people with more liberal views in terms of how the Constitution should be interpreted. What do you think of what I would call the 'realistic view', which is the view that I increasingly come to in most areas of human thinking, which is: People have a bunch of biases and ideologies and philosophies, and they do what they want, and then they cook up the reason later. They are not really seeking the truth when they go out to examine a court case. They know what they are going to come to. They just have to find cases that support that view. In what sense do the Justices of the Supreme Court do what we might call 'real jurisprudence,' where they go and find out what the record says, what are the precedents, as opposed to just figuring out where they want to go and write the roadmap as they go along? Guest: Yes. I mean I think it's all too common. It's a very difficult question in general. Because you don't want to say in effect that people who do this are being completely incoherent or inconsistent. Russ: Or hacks. Guest: One of the things that's so interesting about this is if you figure out what the Progressive intellectual agenda was on individual rights, Federalism, separation of powers of the administrative states, their decisions are perfectly coherent with respect to that basic set of principles. And exactly the same thing could be said with respect to us classical liberals. The reason why I scream is that this is not a debate in pure political theory. You've got yourself a text there. I think in fact it does have certain strong commitments to it. And all those commitments were drafted by people who thought about the world in the way in which I do rather than the way in which they do; and yet somehow or other they always manage to win when it comes to the question of what these words mean. And I believe that the descriptive that you've given, that is that people have their political preferences and then what they do is they organize their judicial theory around it, is in fact correct. But I've never been able to get past the simple point that sometimes you are wrong when you do this and sometimes you are right. One of the tests that you always give yourself is to ask whether or not you are creating this sort of the world's perfect constitution, in which no matter what's written there, you always end up with something that is perfectly in accordance with your own beliefs. Russ: What you like. Guest: Yeah. So, you want to find out whether or not you think there is something which is written there which disagrees with something that you clearly favor. And I constantly ask myself that question. And so if we go back to this commerce clause illustration, and the question is whether or not in 1787 there was a protectionist constitution against foreign trade, the answer to that question is unambiguously, yes. Hamilton was a mercantilist; he was a highly influential [?]. He said in effect if you read Federalist Number 11 that one of the reasons that we have this Federal commerce power with respect to foreign commerce is so we can have a united front against foreign states, otherwise we are at the mercy of market forces in the way in which we regulate our own internal economy. I think this is just terrible prose. Bad idea. But I have no doubt of what they did. To give you another illustration, on the question of whether or not there is judicial supremacy: Now, you read closely what the Constitution says about the creation of the Federal Court system, and it's just not in there. You go back and you check the way in which Montesquieu and Locke describe the separation of powers, and the judicial role was to protect individual rights in accordance with the laws that were passed by the congress and enforced by the executive, there was never to veto or to overcept those laws. And yet we certainly have read, since Marbury and Madison, and Martin against Hunter's Lessee, the thing in exactly the opposite direction. And I think it was wrong as a matter of original interpretation. And that gets you to a second problem. Which is: Suppose you've done this wrong and it works. And you've done it for 200 years. So, I'm not the guy who is going to come along and say: You know, Marbury v. Madison is wrong; what we have to do is to overrule it. I think what happens is constitutional law has two things, to deal with this sort of incipient illegitimacy that gets ratified by past use. One is originalism--that is the text, and the various modes of construction. And the other is what I call in my new book the 'prescriptive Constitution'--i.e., if somebody trespasses on your land, he's a wrong-doer, right, Russ? If he does it for 20 years, he's a new owner. That's the doctrine of prescription. And so it is, if you start with a Constitution, somebody does something which is rather gutsy and probably incorrect, and then people acquiesce in it over a long period of time, that becomes the new Constitution. Not in every case, but in many cases. So that--no originalist that I'm aware of wants to go back to the original Constitution on Marbury or on Martin and Hunter's Lessee--that is, dealing with the power of the U.S. Supreme Court to invalidate state or Federal laws. And so you have to be very much aware, and ask the question: What counts as legitimate long use? Plessy v. Ferguson is pretty long decision; it was in power for 58 years and it was struck down by the Supreme Court. I think the long and the short of that is that it was never a decision whose legitimacy was wide-spread accepted, particularly as segregation became more and more ugly. So, now what you have is you even have a worse world. You have to have a prescriptive Constitution with some selective judgment as to which things last and which things don't. And I think you can do that. What I don't think you can do, is do it in an error-free fashion. Russ: Yeah. Well, there's a certain Hayekian aspect to that prescription view. Guest: Absolutely. Russ: It says that stuff that persists must have something good about it. And, as you say, sometimes it doesn't. There may be a reason it persists that isn't because it's good and unchallenged. But it's an interesting place to start.
47:30Russ: One more question for my 9th grader: What is the elastic clause? Guest: That's a dangerous kid. Russ: Yeah, I know he is. He's dangerous. That's right. What's the elastic clause, and what is your view of it? What is he asking about? Guest: I think he's asking about the necessary and proper clause. Russ: That's correct. What is that? Guest: Well, if you look at the organization of the Federal Constitution, it's a principle of enumerated powers. And at the end of this thing, at the end of this, it says: And each of the departments of government shall have all of those powers--necessary and proper powers--to carry into execution the aforementioned powers. And so what happens is, it's an enumerated powers doctrine with a twist. And the question is just how big is the twist that we have to add in. And when John Marshall interpreted this provision in a case called McCulloch and Maryland, he said that the words 'necessary and proper' when taken together mean 'appropriate.' And that clearly, as a linguistic matter, lowers the level of scrutiny that can be brought to any particular action of Congress. So, if you think that something is necessary, it means that you can't do without it. And proper, meaning that it manages to accord with all sorts of other prohibitions in the Constitution. Appropriate means a much looser connection. And the proof of the pudding is in the case that he was dealing with, which is the question as to whether or not the Congress had the power to create a national bank. So, if you look at the individual powers what you do is you don't see a bank there. What you see is a power to regulate commerce. And the power to issue credit. And the power to run a mint. And so what Marshall said is, you know, all of those things work a lot better if you can have a national bank. And so therefore it's appropriate to have them, and it's constitutional. There was a big debate earlier on as to whether or not the clause could be read that broadly--Hamilton for it, I think, Madison against. My view is that I think Marshall misread the clause. He was in fact a champion of the strong Federal government. Indeed the best illustration is a young fellow who is about to enter into teaching whose name is Will Ford[?] who wrote this very interesting paper in which he said: Well, is it necessary and proper for the Federal government in the States to be able to condemn land to be able to build to post roads? And you would have thought, how can you build a post road unless you can condemn the land? But the practice seems to have been otherwise. And the rule was that if you have two sovereigns, a state sovereign and a Federal sovereign, what the Federal government had to do was the ask the state to condemn the land and then turn it over to them. So that then gives you an exceedingly narrow reading of this clause, and it's not what you would call an 'elastic' clause. It's a clause which says, for example, if the United States has to find people to live in Washington, D.C., they can essentially give people stipends, even though there's nothing in the Constitution which talks about stipends for housing allowances. And I think at that point, the great battle is you really need to say that, because traditional views of construction would always give you those additional powers anyhow. And so this became a clarification. But when you get to the 1930s, all of a sudden people are saying necessary and proper is the way in which you understand the legitimacy of the administrative states. So, instead of having three branches of government, you can now have what is called the 'fourth branch of government', in addition. It's a huge transformation in the way things work, and this shows you why constitutional law is so perilous. You get something and you don't know what it means; and your son asks you a question; you have no idea of the huge stakes that are involved. And the one thing you could say about all great American Constitutional scholars is they understand how significant the issues that they debate in a way that the public does not. And so with the necessary and proper clause, you get the administrative state. If it turns out that the Commerce Clause allows you to regulate those things which affect interstate commerce even if they are not in interstate commerce, that seems to you like a matter of words; well, you can set prices in the agricultural markets under one way, and you can't set them under the other. So that the battle over the two meanings of the Commerce Clause is a way of expanding Federal power by an order of magnitude at least, if not more. So that's why these things make such a difference. And my view is from the classical liberal Constitution is, if you are trying to figure out under the species of eternity how you put these things together, understanding the recurrent dangers of political order and the recurrent problems associated with factions--the 1787 Constitution is actually more sophisticated than the 1937 Constitution. And part of the reason why we have such a malaise now is there is such a concentration of power in Washington that it's a huge target for every interest group in town to come there and essentially, as you said at the beginning of the hour: You can't create wealth if all you are interested in doing is transferring from one party to another. Russ: Ah--a sigh. A long sigh.
52:35Russ: It crosses my mind, as I ask the guests from time to time a variant of this question, that, we get the Constitution we deserve. You and I, we like the Constitution of 1787. Other people like the 1937 one or the 2007. And we don't have many people that agree with us. So, there are these underlying political forces--again, all these ideas about theories of judicial interpretation, that's just window dressing. What's really going on is, the President nominates Supreme Court justices that are politically popular, and basically the ones that are politically popular, because the President wants to be politically popular, and his party wants to be popular, are going to be justices that don't have the "right theory" of the Constitution, but who open the door to laws, legislation, that most people want. And what most people want is a more active Federal government. Guest: What do I think about that? Russ: Yeah, what do you think about that? Guest: Most people want--I think most people want a more active Federal government to advance the particular cause that they champion and a smaller Federal government with respect to all those things which harm them so greatly. And so what happens is you still can get large numbers of people who will quote to you Gerald Ford when he says to you: the government is big enough to give you everything you want; it's big enough to take away everything that you have. And most people straddle that particular kind of an insight. So they don't know which side they are on. But that's why these academic debates, so called, are so absolutely important. Because quite simply, the stakes are enormous. It's very clear that there is no sort of automatic guardian of the public welfare that sits outside of human beings, by divine origin or divine power to structure these things, so what you have to do is to change the climate of opinion in the hopes that once you do that, you'll be able to change the input of the judges on the Court. And remember, it is very common for justices on the U.S. Supreme Court to shift one way or another. Harry Blackmun started out in some sense as a Nixon appointee, and he does the abortion cases because he worked for the Mayo Clinic, and by God, by the time he's done he's a member of the liberal faction. Indeed, if you look at the Supreme Court there are many conservative Presidents who appointed liberal justices. I think I did a rough calculation once that between, say, 1956 and 2005, roughly speaking, what you could say was that each year on average there were three justices appointed to the Supreme Court by conservative presidents who turned out to have deeply liberal sentiments. Russ: My theory of that is they like to go to good parties. So, after you've been in Washington for a while, and most people are not like you, you think: Well, this isn't any fun. Slightly cyncial. Sorry. Guest: Yeah, I know that. But not with Bill Brennan. Eisenhower appointed him because in 1956 he thought he needed to solidify his base in New Jersey. He later described it as the worst political miscalculation in his career. Earl Warren was in fact part of a political deal that if he backed Eisenhower in 1952, he would get the next open seat, and it just happened to be the Chief Justiceship of the United States Supreme Court. Stevens, who is a very distinguished judge, was a buddy of Edward Levy, and that had a huge amount to do with it; and Edward was a progressive Republican and so did it turn out was our friend, Stevens. David Souter was sworn to by Warren Rudman to be a man that would be sound; and it turned out that the first Bush believed him and he got himself 20 years of relatively left of center justice. Russ: Does it ever go the other way? You get somebody who is nominated-- Guest: Political--your party theory--no. It tends to be as people get on the Court, they tend to veer to the left. Russ: And that's consistent with my party theory. Guest: Yes. Sandra Day O'Connor certainly was a more liberal justice towards the end of her term than she was at the beginning. Same thing could be said even of Bill Rehnquist. Somebody like Byron White is a very complicated character, because he was very far to the left on labor issues, on which he was much further to the left than Bill Brennan; but on the other hand he was very conservative on moral kinds of questions, police power, abortion. So he was conservative on some issues. It was not a case in his situation of a transformation. I think that's the way he was when he took office in the early 1960s and he remained that way until he resigned some years later. Now, it's a complicated set of mixtures but there's no question that the age of miscalculation, as one might call it, I think is over now. If you look at the current Supreme Court, every one of the 9 of them is reforming in the [?]. Except possibly for Kennedy. And he was appointed of course 25 years ago. But even he--on the Commerce Clause stuff--everybody said he was the doubtful man, and he came out essentially completely transformed the earlier argument, when he just asked the very innocent question: Does Congress have the power to create commerce in order to regulate it? I mean, you know, that was tough stuff. The theme to end with on the hour is that we all have simple theories which explain some portion, but the closer you look at any of the particular issues, the more complicated the cross-currents turn out to be. So as a descriptive matter, it's very hard to figure out how the capture theory works, under this current Constitution that we have. And as a normative theory it's very difficult to figure out which way the Justices are going to start to come down on the really big cases that shape and define the nation.
58:07Russ: Let me close with a rhetorical question I have here written down--it's kind of comical: Is there anything important you have to say about the Constitution I haven't asked you about? It's a rhetorical question--I know the answer is Yes. Guest: Yes. Russ: Why don't you close with some final thoughts, and you might want to mention which direction you think we are going. You and I would like to be closer to 1787. See anything moving us in that direction? Guest: Well, I mean, you know, for example, the single most momentous issues before the Court right now are the gay marriage issue, which is a judicial fabrication designed to create a new set of social rights. Politically I'm very sympathetic with it, given my libertarian organization, but in terms of the structural history of the American Constitution, I'm highly doubtful that you can squeeze this into the Equal Protection clause as it was understood in 1868. The Supreme Court, I predict, will move fairly substantially in the direction of creating constitutional equal protection rights, with respect to gay marriage. And this is originalism on the one hand as against at this point a nascent liberarianism coming out. On guns, I'm a dissenter from the general view of the Second Amendment. I think it's largely a structural position which is intended to protect the Federal government from regulating the way arms are used in the states so as to allow the states to organize their militias, which is done in Article I. But today it's read as a free-standing right and the militia portion of it is just dropped out. I don't think that's originalism in my view, and I think Justice Scalia was wrong, and ironically on originalist grounds; Justice Stevens, who wrote the dissent was probably correct. It's not a particularly well-drafted Amendment, but I think that's the best you could do with respect to reading it. So you get these kinds of cross-currents taking place. As I mentioned to you on cruel and unusual punishments with an 's' [?] I think the Supreme Court is just marching to its own drummer without any Constitution authorization on the one hand and without any popular support on the other, and it's a mistake. And then when you start going down the list of economic stuff, the extent to which we tolerate the extensive economic regulation over various aspects of the economy at the state or the Federal level, I think we are engaged in active self-strangulation of the nation, which are very inconsistent with the protections of property and contract that were built into the original structure on the grounds that when you are worried about excessive concentrations of power, you can't put all of your faith in one kind of remedies so that in a very deep sense, Hamilton was wrong when he said that the structures are the protections for civil rights. And the guys who wanted the Bill of Rights were correct when they said that a certain degree of redundancy is needed. And the great peril that we have today is I think there's too much of a public consensus in favor of this view that government gives us more than it takes from us. And so long as that general attitude exists we are going to have rough sledding. We already know that, even though the stock market hit 15000 today, this has been a very slow and very difficult recovery and we also know that most of the interactions that were taken in the 1930s prolonged rather than lessened the Great Depression, which lasted well into the middle of WWII. And it was because of most of the Roosevelt policies, not the spending policies, but the regulatory policies. And I think the single largest issue in the Constitution that we have to face today is whether or not the judicial system will assert its control over Federal regulation, which I think is ruinous to the organization and against its competitive economic ideals.

Comments and Sharing



TWITTER: Follow Russ Roberts @EconTalker

COMMENTS (46 to date)
Greg G writes:

Great podcast here and a very interesting companion to the Seidman episode. Interesting for their similarities as well as their more obvious differences. Both argue from a consequentialist point of view (not that there is anything wrong with that). Both are clear that originalist arguments are fatally undermined by actual history and the fact that no one applies them consistently. They differ most on the consequences they anticipate for the policies they advocate.

I loved the way Epstein backed his arguments with accurate and unsentimental historical accounts. For example, when he pointed out that the principle of sharply limited Federal power had a lot to do with (among other things) a desire to find a way to assure that slavery was permitted.

It is probably true that we all rely most heavily on our intuitions in deciding these issues. The arguments we use are rarely the decisive thing even when we think they are. Even so, it is a pleasure to hear a position as well argued as we heard in this podcast.

Epstein is as good a debater as you will find anywhere. He certainly got the best of Seidman and I say that as someone who probably would agree with Seidman on more specific policy issues.

As Epstein points out, Federalism has effects both good and bad. He wants to emphasize how limiting Federal power can increase liberty. Fair enough. Let's remember it can also permit any number of preventable evils up to and including, well...slavery.

Dale Jung writes:

I think Seidman gets an unfair rap.

If you believe that the Constitution is correct, then you also believe in Natural Laws that existed before pen touched paper. The Constitution is not tautological, it derives its merit from something that cannot be written down or quantified.

The Framers debated and defended their positions without the crutch of saying "this is un-Constitutional." Perhaps the only way to uphold the Constitution is to argue from that same position. If you were to teleport Jefferson to today, he would debate from his first principles, he would say, "We wrote this because we thought it the best way, and here is why."

Like all things that outlive its creators, we've gotten too enamored with the armor and not the fire that forged it in the first place. Now we're finding that it's not protecting us like it once did, and we've lost the ability to temper it anew.

Ak Mike writes:

Greg - As someone who certainly disagrees with Seidman on more specific policy issues, and would agree with Epstein and our host on policy, I nevertheless think that Seidman has the better of this discussion.

I think Prof. Roberts and Prof. Epstein mischaracterize Seidman's argument. He was not saying that the constitution is irrelevant because it was written a long time ago, and therefore should be ignored. Instead, he was pointing out that by its nature the constitution cannot be used to settle current disputes, and that as a matter of fact all judges, no matter how faithful they claim to be, are actually deciding cases based on their own policy preferences.

Seidman notes that you can predict which way each justice of the supreme court will vote based on the politics of controversial cases, rather than the constitutional history of the provisions involved. And he would say that the brief few hundred words of the written constitution simply do not provide the material for deciding most disputes where "constitutional" issues are raised; and this has been true from Marbury v. Madison to the present.

So Seidman's essential point is that constitutional adjudication is a kind of high-minded fakery,and always has been. He wants judges to stop pretending that their decisions are based on the constitution, not because he wants to abandon constitutional adjudication, but rather because there never really has been such a thing.

Greg G writes:

Ak Mike - I thought Russ was only a little unfair to Seidman in his introduction to the topic today. He did add more nuance later in the discussion and I thought he was very fair in the actual Seidman interview which he was probably assuming that most listeners had already heard. Some of the commenters on the earlier podcast did mischaracterize Seidman's views in a number of ways.

As for Epstein, I fail to see where he was unfair to Seidman in any way here. I understood Seidman to be saying that we do care, and should care, only about getting good results from government. And that since constitutional arguments are delaying needed reforms, open disrespect for the Constitution is called for and courts should mostly just defer to legislatures.

I understood Epstein to be agreeing that people care most about getting the policy results they want. He recognizes that there are bad arguments as well as good arguments for he policies he supports. But he is saying we should also care about respecting long standing precedent and being consistent with the text and the original intent of the law. Each of these concerns has the potential to conflict with the others.

Sure there is often a lot of "high-minded fakery" in constitutional arguments. The right way to deal with that is to call it out when you see it, not to dispense with respect for the Constitution. Despite our many problems, this American constitutional experiment doesn't look that bad at all in the larger context of human history.

Ak Mike writes:

Greg - you are right that Seidman does not respect the constitution overly much. And you are certainly right that Prof. Roberts, as always, was fair to Prof. Seidman when he was interviewed a few months ago.

However, I respectfully submit that you haven't perceived the strength of Seidman's argument about constitutional adjudication, and neither have the participants in today's discussion. You cannot just call out the fakery when you see it in a constitutional argument, because fakery is inherent in every constitutional argument. Justice Marshall made up his right to overturn a statute in Marbury v. Madison, which is not in the text of the constitution. Justice Warren made up his prohibition of segregated schooling in Brown v. Board of Ed., which is nowhere in the 14th amendment. None of the issues in the important constitutional decisions can be settled by the text of the constitution. It's just a short simple document that has very few answers for these vexing questions. So the judges resort to such concepts as "original meaning" or "living constitutionalism," by which anyone can come up with a myriad of plausible reasons to justify any result you would like to reach.

I think Seidman is right about this: constitutional interpretation is like Rorschach inkblots, everyone sees his/her own opinions and ideas in the text.

Seidman's problem is that he has nothing to replace constitutionalism with; and he does not seem to value the real purpose of constitutional decisions: to provide a cloak of legitimacy for the counter-democratic limitations that are imposed by policy preferences of judges, which they pretend are based on this ancient document.

Roger McKinney writes:
“And as a normative theory it's very difficult to figure out which way the Justices are going to start to come down on the really big cases that shape and define the nation.”

And that means we long ago abandoned the rule of law and have been subject to the arbitrary rule of men. No one can predict how the law will change, which creates a regime of great uncertainty in almost all areas.

Roger McKinney writes:

PS, I think somewhere Mises wrote that the only constitution that matters is the will of the majority. It seems that is what Epstein is saying, too. If the majority does not want liberty they will not have it.

John Berg writes:

The middle ground between Epstein and Seidman seem to be that the Constitution is a good written contract that we can use to guide us AND that some instances of making it fit the desired ends for some people has occurred. Seidman suggests the mechanism used to effect the progress along the chosen path and Epstein shows effects of each bending of the Constitution since 1937 and the pathway used.

I can not help thinking of the deeply disturbing decision of Chief Justice John Roberts and how it was effected.

Epstein seems to suggest the only way to return to a path of smaller Federal government is for the Judicial branch to reverse the path to the Administrative State and to give control to voters through Initiative, Referendum, and Recall. Could Dr. Epstein suggest how the Constitution could be used to return control to voters--and certainly before the flood of newly unassimilated immigrants arrive.

John Berg

john thurow writes:

Excellent, thanks!

SaveyourSelf writes:

Great Podcast. Like his previous interviews, this presentation is provocative and nuanced.

What a strange and remarkable idea Epstein put forward. Slavery—arguably the LEAST efficient economic system ever—was the cornerstone that gave birth to [and maintained] a Constitution which respected Freedom to such a degree that it allowed States to compete with each other, and that competition made the US the most fertile laboratory for free market capitalism—the MOST efficient economic system ever—in the world. But Epstein said the Constitution’s remarkable protection of state-autonomy started to erode about 40 years before 1937. I politely disagree. It started to erode in 1861 with the start of the Civil War.

The tolerance for alternative governance systems written in the original US Constitution following the “Great Compromise” waned over time as the number of slave-tolerant states gradually became a minority. Given their majority position, the Northern States sought to force the Southern States to alter their state laws. The Southern States, resenting this intrusion on their self governance, sought to leave the United States. This move towards cessation, not concern over slavery, triggered the Civil War. The conclusion of the Civil War had the incidental consequence of abolishing slavery—a positive economic change—but it also set a precedent that violent action at the Federal level was permissible against citizens when they refuse to follow the edicts of the majority—a very negative economic change.

This viewpoint is disquieting.

The government run school system teaches that Lincoln was the greatest president ever and that the Civil War was an unavoidable tragedy brought on solely by the evil slave owners of the South; that Lincoln “saved the Union;” and that his only mistake was choosing bad generals. Economic analysis suggests the opposite. Slavery would have abolished itself! Slavery, after all, is ridiculously inefficient. The South could not compete with its free market neighbors or the rest of the world using a slave system. The South, left to its own devices, would have eventually collapsed—exactly like the USSR in 1991. The Southern Confederacy would have imploded and spontaneously dissolved when its citizens got tired of their intolerably low standard of living. And, like the fragmented nations that fell out of the USSR, the Independent Southern States would have strongly desired re-entry in to the Free Market economy of the United States where the standard of living was much, much higher. Unfortunately, Lincoln did not allow nature to take its course. Instead he led a brutal and destructive war—decimating the infrastructure of the South and killing 600,000 people—while simultaneously establishing both a precedent for supplanting the Constitution with majority opinion and a precedent for suppressing minority dissent with violence. Lincoln is probably the worst president in all of US-history and a villain of gigantic proportions. He rendered the Constitution hollow while trying to save it.

Greg G writes:

John Berg - You heard in this interview the suggestion that the only way forward toward what Epstein advocates involves Initiative, Referendum, and Recall. I didn't hear that at all. Which raises an issue that is even more fundamental than constitutional adjudication.

Each of us comes to all of these issues with a lot of prior beliefs. When we dislike the way it works out we call that bias or prejudice. When we like the way it works out we call it learning. Either way we can't start at square one on every decision. This problem will still be there in full force even if we do away with constitutional arguments and go straight to arguing about the effects of proposed legislation.

Staying with our tradition of conducting the debates within a constitutional framework provides the important benefit of making outcomes more predictable. As a rule, we all want predictable outcomes to judicial questions...except, of course, for the cases where we don't like the predictions.

Greg G writes:

SaveyourSelf

Sure secession, not slavery, was the immediate cause of the Civil War. While that is true, it conveniently ignores the fact that disputes over slavery were the main cause of secession. So it still really did have a whole hell of a lot to do with slavery.

History shows we would have eventually gotten independence from England without a Revolutionary War. Does that mean fighting for our independence was a mistake? Does it mean Washington was "a villain of gigantic proportions" ? There were a lot of colonists who were Loyalists after all.

Does it mean that if one of our states today chose to secede and establish slavery it would be wrong to fight a war to prevent that? I really can't think of anything a majority could do that would advance the cause of liberty more than opposing slavery.

John Berg writes:

Saveyourself offers a distracting bit of hypothetical alternative history but one not helpful to correcting the history since 1937 that has imperiled the world I had hoped to leave my grandchildren. Inter alia, 1937 also saw the FDR's Supreme Court Packing threat which President Obama may have used to intimidate John Roberts into using a mechanism such as Seidman suggests to contrive a method to save Obamacare and possibly Obama's reelection.

Turning to GregG's comment, I thought Dr.Epstein took any possible remedy away from the Legislative and Judicial Branches and placed such a possibility in the voter's hands. We are about to find out soon whether the Supreme Court says the courts can trump clear decisions from the electorate at the polls.

John Berg

John Berg writes:

Two question in response to Dr. Epstein's quote:

And that gets you to a second problem. Which is: Suppose you've done this wrong and it works. And you've done it for 200 years. So, I'm not the guy who is going to come along and say: You know, Marbury v. Madison is wrong; what we have to do is to overrule it. I think what happens is constitutional law has two things, to deal with this sort of incipient illegitimacy that gets ratified by past use. One is originalism--that is the text, and the various modes of construction. And the other is what I call in my new book the 'prescriptive Constitution'

My reading of the Constitution notes requirements for the Presidency: S/He must be native born citizen, commonly meaning both parents are born in the US. When can we insist on a presidential candidate proving he meets the Constitutional requirements?

I also read that the 14th Amendment as saying that the questioned state of children born to former slaves now freed is that the children are citizens whether born during slavery or after emancipation. When can we end this nonsense that alien mothers can bestow citizenship on their children merely by having it in the US?

John Berg

Apropos of Dr. Epstein's

Cowboy Prof writes:

This was a great podcast despite my priors going into it. I had read the first 5 or 6 comments and was a bit dubious about it.

I know that Russ likes to hear how we use his podcast and what resonates with listeners, so here is how I know it was a great podcast:

1) I was listening whilst walking the pooch this morning as I usually can focus on the interview with this relatively routine task. However, I know this was a great podcast because I could not continuously focus on the whole interview from front to end. Epstein would say something and I would start thinking about what he said and then 5 minutes later realizing that I hadn't heard anything else. I would have to pause and rewind. In short, I know that I will be listening to this at least two more times in the next week to get the full impact of it.

2) In addition to the substantive points Epstein was making, the discussion spurred me to reorganize my fall graduate seminar a bit differently than I was planning, including a potentially ingenious pedagogical attempt to run it like an EconTalk podcast. (Email if you want details.)

3) I will buy Epstein's book when it came out. There have been a handful of these podcasts, most notably Leeson's pirate book and (more recently) Bernstein's book on language.

Cowboy Prof writes:

Substantive Comment.

There was a great deal in this podcast that prompted me to think, including the ironic role that slavery played in crafting limited government. However, what really struck me is Epstein's rather brief comment on Kelo v. New London (one of my big SCOTUS pet peeves for how it affects religious organizations).

When Epstein said that Kelo was not judicial activism I did a full stop with the dog (yanking him back on his leash so that he looked like a bucking bronc) and said, "Ruh?" But what he said made perfect sense. Kelo did nothing more than legitimate what Congress, state legislatures, and various bureaucracies are doing with other laws and regulations anyways. Crafting a zoning regulation via the city council has as much of an impact as the city council declaring eminent domain and giving pink residential houses to giant pharma companies (who probably won't use the land anyways).

But on the other hand, I still disagreed with Epstein in that the eminent domain clause of the 5th Amendment seemed like a major impediment, and perhaps one of the few remaining, to regulatory power. The cost of blatant land grabs by the government at least had some high legal barriers and other costs (I could sue like Kelo did) to it, thereby slowing down the rapidity in which the "administrative state" operates.

So, oddly enough, I both agreed and disagreed with equal fervor with Epstein on that issue proving that someone can be both right and wrong at the same time!

Louis Michael Seidman writes:

I have a great deal of respect for Richard Epstein. I'm confident that he has better things to do with his time than to educate himself about my, admittedly idiosyncratic, views of constitutional law. Still, it's a shame that he didn't bother to read my book before criticizing it. He says that I favor popular constitutionalism and would abolish judicial review. But on pp 129-30, I expressly say that my position leaves open the question of whether judges would continue to have the power to invalidate statutes. For my doubts about popular constitutionalism, see Can Constitutionalism Be Leftist?, 26 Quinnipiac L. Rev. 557 (2008). Professor Epstein professes not to know what I mean when I argue against constitutional obligation. In On Constitutional Obligation, I take many pages to spell out precisely what I mean. I commend the book to Professor Epstein and won't try to repeat anything like the whole argument here. But if I had to summarize my position in a couple of sentences, it would go like this: We should feel no obligation to do things just because people who are long dead and had no inkling of our present circumstances wanted us to do them. Instead, the desirability of various constitutional provisions must be defended by argument that makes sense today. Ironically, Professor Epstein, here and elsewhere, has engaged in just this sort of argument -- argument that would be irrelevant if one thought that there was a duty of blind obedience to the Constitution.

Greg G writes:

Professor Seidman

First, thanks for being part of the conversation here.

I share your low opinion of Originalism but I don't hear anyone advocating for Originalism while also agreeing that their position makes no sense today but they are bound to it anyway.

When we get down to real cases the Originalists almost always argue that the original intent still does make sense today. Yes, if necessary, they ignore some key historical facts in order to do so.

There simply is not any significant number of people using Originalism to argue for laws they wouldn't favor anyway.

John Berg writes:

I suppose within the sense I understood Greg G above and Dr. Seidman in his podcast I am an "originalist." I certainly swore formally to defend the Constitution. In my comment above I raised two issues about changes to the original Constitution: the first made by simply choosing to ignore the Constitution; the second, the right to citizenship by birth, occurring closer to use of a mechanism such as Dr. Seidman suggests.

My question about both is how do they get fixed?

John Berg

David writes:

I found many of Professor Epstein's comments very informative. And in many respects I share his concern over the growth of federal power. I am a criminal defense lawyer and I work exclusively in federal court at both the trial and appellate level. Over the 20 years that I have been in practice, I’ve witnessed an enormous increase in the “federalization” of traditional state crimes.

But, that having been said, I found the podcast somewhat frustrating – particularly when the discussion turned to the Commerce Clause and the “rise of the administrative state.” Professor Epstein seems to lay a lot of blame on SCOTUS for the increase of federal power and the rise of the "administrative state." At the end of the podcast, he suggested (even recommended) that the “judicial system . . . assert its control over federal regulation, which [he] thinks is ruinous to the organization and against its competitive ideals.” I’m not completely sure how to take that comment, except as a call for rank judicial activism.

Congressional authority to regulate interstate commerce derives from Article I, Section 8 of the Constitution. This provision also enumerates a number of other powers, including the authority to “establish a uniform Rule of Naturalization”, and to enact laws to protect intellectual property (i.e., patent and copyright laws). I think it would have been useful to the discussion if Professor Epstein had given some background on the SCOTUS’s Commerce Clause jurisdiction and explained how it reviews Congressional legislation passed pursuant to its commerce authority.

Congressial authority to regulate commerce is expansive. Its authority in this arena is amplified by the Necessary and Proper Clause. As early as 1838, in a case entitled United States v. Coombs, the SCOTUS determined that the Necessary and Proper Clause gives Congress authority to regulate intrastate (not just interstate) commerce. When necessary to effective regulation of interstate commerce, Congress may regulate intrastate activities that do not, in and of themselves, substantially affect interstate commerce. As it is now articulated, the Commerce Clause (paired with the Necessary and Proper Clause) permits congressional regulation of: (1) the channels of interstate commerce; (2) the instrumentalities of interstate commerce; and (3) activities that “substantially affect” interstate commerce.

Our system is one of separation of powers. Out of respect for the other branches of government, the judiciary generally affords great deference to the acts of Congress and the Executive.

It reviews Congressional authority under the Commerce Clause under what is termed the “rational basis” test. The idea behind rational basis review is that the judiciary must show deference to the elected representatives of the people. A law – be it a prohibition against medical marijuana, a wage and hour regulation, or a statute prohibiting racial discrimination in restaurants – will be upheld so long as Congress had a rational basis for concluding that the chosen regulatory scheme was necessary for the protection of commerce. A judge cannot strike a statute simply because he disagrees with it or, even, if he thinks it is stupid and may prove harmful.

So, while I am sympathetic to many of Professor Epstein’s concerns – and I mean no disrespect to him personally or professionally – I think a little more explanation of the nuts and bolts of Congressional authority and the standards of judicial review would have been helpful to a clearer understanding of the issues.

Richard Epstein writes:

I am somewhat taken aback that Professor Seidman reacted so sharply to my comments. I thought that it was clear from the comments that I was responding to Professor Roberts’ question about Seidman’s general views. I based my evaluation in large measure on his New York Times editorial, which I argued was thoroughly misguided in my Hoover column Our Obsolete Constitution? I might add that my views are unshaken by Professor Seidman’s restatement of his position here, which I find most alarming. To claim that “the desirability of various constitutional provisions must be defended by argument that makes sense today” is to leave much too much running room to judges and others entrusted with interpreting and applying the Constitution. My own views will be set out in detail on this issue in my new book, The Classical Liberal Constitution: The Uncertain Quest for Limited Government, which will be out this fall from Harvard University Press.

Nathan Willard writes:

Given the fact that both Prof. Seidman and Prof. Epstein have entered this conversation it may be stupid for me to make any comment, but I will anyway.

My comment has to do with Seidman’s general principle that the Constitution must stand or fall based upon its merit, not its authorship. I have a great amount of respect for Russ Roberts, but felt that during his conversation with Seidman he just didn’t understand the basic idea of what Seidman was trying to say, this feeling was reinforced in his conversation with Epstein. I feel that Roberts greatly misconstrued Seidman’s viewpoint and presented Epstein with a straw-man that was easily dismissed.

I’m not saying I agree or disagree with Seidman’s political views. It makes no difference, the basic principle he is putting forward is separate from a particular political agenda. He is not saying we should throw out the Constitution; he is just saying the Constitution is not a sacred text – it is not a final unquestionable authority. Epstein acknowledged that there are some bad ideas in the Constitution, ideas he disagrees with. He thinks it’s good we don’t follow them, or return to them. When he started talking about Hamilton on commerce, Marbury v. Madison and “prescriptive Constitution”, I thought that’s exactly what Seidman was talking about.

So we must admit that we should not, and really cannot, just appeal to the authority of the Constitution and think that will settle an argument. We must craft convincing arguments for the validity of the Constitution if we wish to preserve it. Because of Eptstein’s comment I better understand what he sees as the danger of Seidman’s argument. However, this battle is not just being fought in the courts. It is being fought in the public square. It seems that most American’s do not understand or care what the Constitution actually says. So if we wish to preserve what we think is good about the Constitution, and change what we think is bad we must do so with compelling arguments. We must convince the American people of the beneficence of our views for today. The Constitution is upheld or ignored based upon our ability to justify its worth - Thank you Russ Roberts for doing a great job of this with Econ Talk.

Ak Mike writes:

Prof. Epstein - I am an unabashed admirer of yours and believe your comments in this interview were honest, insightful, and thoughtful as always.

But - is it really correct to speak about being right or wrong in making a constitutional decision? Isn't it the case that no constitutional decision, from Marbury forward, can claim to be compelled by the constitutional text? And isn't constitutional intent an impossibly vague standard for reasons articulated by Justice Scalia when speaking about legislative intent? And don't all judges, when looking into the constitutional mirror, see their own reflections?

In short - your criticism of Prof. Seidman's proposed remedy is a bullseye - he would substitute an explicitly political decisionmaking process with zero legitimacy for the current method: but doesn't he have a point that constitutional decisionmaking currently is a bit of a sham?

David writes:

My last post was long-winded and I don't want to bore my fellow listeners. But I want to respond to comments made by Nathan Willard and Ak Mike.

(1) Nathan says: "I have a great amount of respect for Russ Roberts, but felt that during his conversation with Seidman he just didn’t understand the basic idea of what Seidman was trying to say, this feeling was reinforced in his conversation with Epstein."

I agree with Nathan completely. I love EconTalk and have a great respect for Russ. But during the Seidman interview, I felt like I was listening to two very smart people who were talking past one another. Law and economics, as disciplines, often rely on different modes of thought and ways looking at the world. I felt like Russ was speaking "economese" and Seidman was speaking "legalese" and neither really understood what the other was saying.

(2) Nathan says: "It seems that most Americans do not understand or care what the Constitution actually says. So if we wish to preserve what we think is good about the Constitution, and change what we think is bad we must do so with compelling arguments."

Again, I agree completely. I would only add that, in addition to the Constitution, most people are completely misinformed about how our legal system -- by which I am referring to the courts -- actually operate. Don't get me wrong, after 20 years of active practice, I see a lot to be disillusioned about. But, so much of the criticism I hear on the street and in the press seems ill-informed and misdirected. People don't understand concepts that lawyers and judges deal with every day -- standards of review, different forms of error (is it harmless?; is it plain?), exhaustion requirements, etc., etc. Therein lays my critique of Epstein's interview. One can criticize the judiciary and recent constitutional interpretation all day. But, I think to do so effectively, one should have a basic understanding of the rules under which courts operate.

(3) Ak Mike says: "Is it really correct to speak about being right or wrong in making a constitutional decision? Isn't it the case that no constitutional decision, from Marbury forward, can claim to be compelled by the constitutional text?"

I'm not sure that I agree with you completely. The Nineteenth Amendment (giving women the right to vote), for example, seems pretty clear. But, you are right in that much of the language in the Constitution is vague. An "unreasonable search" -- what is that? Well meaning, smart people can and do disagree over the meaning of such terms. The Second Amendment, in my opinion, provides a perfect example of what I'm talking about. If you haven't already done so, read the SCOTUS's decision in District of Columbia vs. Heller. As you may know, Justice Scalia wrote for the majority and Justice Stevens wrote the primary dissenting opinion. Putting aside whatever bias you may have, try to decide who was correct. Was it Justice Scalia or Justice Stevens. Personally, I don't really know. But I lean towards Justice Scalia even though I generally favor gun control laws.

Finally, Russ, if your son has not yet done so, suggest that he read Justice Scalia's concurrence in Gonzales v. Raich, the medical marijuana case decided several years ago. It is only about four pages long and, as always with Justice Scalia, is beautifully and simply written. In the opinion, he discusses the Necessary and Proper Clause and its interplay with the Commerce Clause.

l0b0t writes:

If one is going to read Raich at all, I would humbly suggest starting with the blistering dissent penned by Thomas; in my opinion, his absolute best writing. Raich is one those cases that just scream injustice, the state creating commerce out of whole-cloth for the sole purpose of furthering the inhumane policy of the prohibition of (certain non-government sanctioned) intoxicants.

As for the Constitution being at all ambiguous, I'm afraid I just don't see it that way. "Shall make no law" and "Shall not be infringed" are pretty clear to me. The only ambiguity comes about when one tries create a veneer of legitimacy to state actions that are clearly contraindicated by the plain text of the document; hence, a century of "emanations and penumbras" and an ever-growing federal Leviathan.

Buckland writes:

[Comment removed pending confirmation of email address and for irrelevance. Email the webmaster@econlib.org to request restoring your comment privileges. A valid email address is required to post comments on EconLog and EconTalk.--Econlib Ed.]

SaveyourSelf writes:

@Greg G

“…disputes over slavery were the main cause of secession.”

Differences in opinion regarding the Constitutional protection of States’ rights to self-govern was the main cause of secession.

“History shows we would have eventually gotten independence from England without a Revolutionary War. Does that mean fighting for our independence was a mistake?”

Tough question. Please allow me to restate it a bit: Does separation from English-rule 200 years earlier than would have occurred naturally justify the loss of life, loss of property, and damage to infrastructure that occurred in the War of Independence. Maybe. The Constitution is a remarkably good economic document (as you might expect at the heart of the strongest economy in the world). All the economic loss from the war of independence has probably been repaid several times thanks to the creation and application of the Constitution.

“Does it mean that if one of our states today chose to secede and establish slavery it would be wrong to fight a war to prevent that?”

I think you considering two very different questions together. Let us consider them separately.
1. “If one of our states today chose to secede…it would be wrong to fight a war to prevent that?” Yes. Freedom is one of the requirements for a society to produce a high standard of living. Freedom includes the right to make poor decisions. It is contrary to all reason to introduce violence—kill people—in a futile attempt to prevent poor decisions given that poor decisions generally correct themselves if given time.

2. “If one of our states today chose to …establish slavery it would be wrong to fight a war to prevent that.” No. Forcing people in to slavery reduces Freedom. Freedom is one of the requirements for a society to produce a high standard of living. It is reasonable to violently oppose such a profoundly negative change in an economy.

By separating the two questions you can see that the direction of change in the market assumption [Freedom in this case] is what matters when trying to make decisions about war. Past decisions--good or bad--are “sunk costs.” Considering "sunk costs" when making decisions is a common mistake of logic. I recommend avoiding it.

Greg G writes:

@ SaveyourSelf

If we are obligated to permit a state to secede is a state then obligated to permit a county to secede from the state? Is a county then obligated to permit a town to secede? Is a town obligated to permit an individual landowner to secede?

At some point the freedom of some people to make bad decisions will impinge on the rights of other people to make a nation at all. I am aware you can trace this back to the 13 colonies declaring independence but that itself was an arbitrary historical contingency. It is hard to see how you derive a metaphysical right from such a thing when it is not at all clear that a majority of colonists favored going to war with Britain when independence was first declared.

SaveyourSelf writes:

@ Greg G

You wrote, "If we are obligated to permit a state to secede [from the nation], is a state then obligated to permit a county to secede from the state? Is a county then obligated to permit a town to secede? Is a town obligated to permit an individual landowner to secede?"

Yes, except I would change the word "obligated" to "obliged."

"At some point the freedom of some people to make bad decisions will impinge on the rights of other people to make a nation at all."

I think when you say "right to make a nation" you are talking about freedom of contract. I fail to see how allowing some people to opt out of a contract interferes with others entering in to one.

"It is hard to see how you derive a metaphysical right from such a thing when it is not at all clear that a majority of colonists favored going to war with Britain when independence was first declared."

This is an interesting sentence. I think when you say "metaphysical right" you are referring to my statement about "States' rights to self govern." If that is the case, I think metaphysical is an inappropriate term. The States' rights to self govern is spelled out explicitly in the constitution. Since the Constitution is a real contract negotiated and agreed on between the states, its conditions are real--not metaphysical.

Regarding your mention of “a majority of colonists” not favoring war with Britain, I think you are revealing a belief that a majority opinion = truth or that majority opinion = moral. I would caution anyone who holds this belief that it is wildly dangerous and misleading. Remember Galileo. The majority once thought the sun circled the earth. The lesson there is that the opinion of a majority is irrelevant to truth. Majority opinion generally is useful only as a proxy for violence. That is to say, the larger number of people would probably win a physical contest if the dispute over the question every came to blows—as demonstrated in the American Civil War.

You have really good questions, Greg, thank you.


Greg G writes:

@SaveyourSelf

You say that you fail to see how allowing someone to opt out of a contract prevents others from making one. Consider a municipal water and sewer system in a large city. You could never have a modern water and sewer system in an urban area with out the power of eminent domain. A small number of holdouts could stop the whole thing. We know what cities were like before modern water and sewer systems. They had levels of disease that impinged on everyone's freedom.

I'm pretty sure the CSA didn't allow localities to secede from it and remain part of the USA. A nation simply isn't a nation if you allow that sort of thing. It is an imaginary anarcho-capitalist state never actually seen in nature for long.

People don't just care about the absence of coercion. They care just as much about the presence of positive options. That is why no one would want to live on a desert island even if it was well stocked with material goods. We are a social species. The desire to live with other people means that there will always be disagreements about what the law should be and no one will always get their way.

Of course majority opinion is not always right. Neither is it irrelevant to truth as you claim. It increases the odds of being right. The reason Galileo's ideas are still taught today is because they were convincing to an overwhelming majority once that majority was fully exposed to them.

My point about a majority of colonists was not a claim that the majority would have been necessarily right. (We have no way to even be sure exactly what a majority thought.) My point is that, to the extent that you want to view the Declaration of Independence and Constitution as having their legitimate foundation in the right of contract, you need to remember that that was a contract among a minority of the colonists at the time. The majority were not even consulted.

Greg G writes:

@SaveyourSelf

One more good question if you will indulge me. If we are obliged to permit localities of every variety to secede from the larger political entities they are a part of, then exactly how will we decide when the secession request is legitimate given the fact that you have ruled out majority opinion as useful?

SaveyourSelf writes:

Greg, it appears we have the room to ourselves.

If I am understanding your scenario about city sewers correctly, you are arguing that because city sewers reduce levels of disease, eminent-domain is justified. Lets talk about eminent-domain.

Eminent domain is compulsory purchase of private property by government. Eminent domain is a dangerous and deceptive concept. It is a subtle logic trap. It must never be used.

Expanding on your sewer example, imagine that everyone on a city block wanted a sewer line installed except one person. Imagine further that that one person would allow no sewer line across his property for any price. Under “eminent-domain,” the other homeowners could approach the government and ask the government to force the holdout-owner to allow the sewer line to traverse his property. Their pitch to the government is, “the injury to the holdout-homeowner, whatever it may be, is less than the gain to all of society following the sewer line's completion.” That argument sounds reasonable, but includes several traps hidden in plain view. The first—and least important—is that the argument implies that the sewer cannot be completed except is a straight line. It leaves out pump stations and parallel lines from other streets and all manner of other options. The second trap is far more substantial.

“Society,” is fundamentally a group of people who agree not to injure one another. It is a contract between like minded people who realize that violence is the greatest obstacle to improving their standard of living. The formal agreement not to hurt one another is the “Societal contract.” This is relevant to a discussion of eminent-domain because when eminent-domain is invoked someone is getting hurt! The societal-contract is being violated. Eminent-domain literally DISOLVES THE SOCIETY. Exercising eminent-domain is like making a deal with the devil where he cures the inconvenience of a cold but in exchange gives you cancer. This is why Eminent Domain must never be used. It kills society.

So what are the alternatives to Eminent-domain? Sometime just raising the offering price for access to the property solves the problem. Sometimes just routing around the property is the only solution. Sometimes Justice allows for the use of force.

I suspect for most people city sewers just makes sense. Who wouldn't want their sewage carried off their property and rendered harmless. But what if someone didn't want it?

Adam Smith defined Justice as a set of negative precepts that prevent harm to strangers. Do not kill. Do not harm. Do not lie. Do not steal. In Richard Epstein's book, “Design for Liberty,” he talks about how sewage spilling over from one person's property to another person's property is generally accepted as a harmful act, which means it violates Justice, which means it requires an accounting under the Societal-contract, which means society can force the offending land-owner to adopt some sort of solution that stops the injury. It is Justice and expedience, therefore—not Eminent Domain—that leads citizens to allow sewage lines to cross their property. Even so, if there is a way to safely process sewage on a tiny plot of land so it does not travel to a neighbors property and that land-owner refuses to allow sewage lines to cross his property at any price, then there is no violation of Justice and that land-owner is protected by the societal-contract from his neighbor's desires. In such a case, force against the land-owner—through eminent-domain or any other coercive policy—is a violation of Justice.

Now, the reason you brought up sewers and eminent-domain is because you were trying to imagine that same scenario with the added complication that the holdout-homeowner was not a citizen—he opted out of the societal contract. He is a foreigner/alien. There are two possible outcomes to that scenario. One I will call a moral-intelligent outcome and the other an immoral-natural outcome.

In nature, when different societies meet they usually try to destroy one another. It would shock no one, I believe, if the holdout, alien, property owner was approached by his neighbors at gunpoint and forced to allow the sewer lines to cross his property. Ditto if they just killed him and took his property. Either way there is NO CONSEQUENCE from the societal contract. He wasn't a party to it. Even though there are no societal consequences, there are ECONOMIC CONSEQUENCES to immoral acts. After all, you can't trade with a dead man or trade with someone who hates you for past injuries. Absence of trade leads to lower standard of living for everyone, because the economic model which is known to produce the highest standard of living for everyone requires Trade in a Free-Just-Competitive-Informed market. Sacrifice any of those variables and there is a corresponding decrease in societal standard of living.

President Lincoln, obviously, chose this immoral-natural approach. When the Southern states left the protection of the US Societal-contract, he killed them. While killing the outsiders, he did a remarkable amount of damage which decreased the standard of living for both the Northern and the Southern states. Some of that unnecessary poverty continues to this day. The poorest states in the nation are still in the South--Mississippi foremost among them.

Had Lincoln taken the moral-intelligent route, he would have allowed the Southern States to secede and treated them with Justice—ie. not harmed them—but he need not have helped them either. He could have refused to allow trade with the new Confederacy knowing the lack of trade plus the innate inefficiency of the slave driven economy would produce such a profound level of poverty that the independent Southern States would probably, eventually return to the United States—sans slavery. Barring trade would have hurt the Northern States too, but the Northern States had deeper pockets and would have weathered the recession better.

Anyway, back to the sewage problem. If the holdout-homeowner was a foreigner/alien, it would still benefit his moral-intelligent neighbor's to treat him with Justice and run the sewer lines around the property. Treating him like a citizen in this most basic sense of not harming him would, in the long run, provide larger economic benefits for all parties than the cost of re-routing the project.

SaveyourSelf writes:

Greg wrote, “If we are obliged to permit localities of every variety to secede from the larger political entities they are a part of, then exactly how will we decide when the secession request is legitimate given the fact that you have ruled out majority opinion as useful?”

I hope I have convinced you that the foundation of society is a contract not to harm one another. Entering a contract requires the consent of the other parties to the contract but leaving it does not. Leaving only requires the dissatisfied person to inform the others parties that he is departing. The only party whose opinion matters in your question is the individual choosing to opt out.

Greg G writes:

SaveyourSelf

Yes, it's probably a good thing we have "the room to ourselves" at this point because we are off on a bit of a tangent. Even though we disagree on a lot, I appreciate your thoughtful and fair replies. That is not always the norm in these internet debates.

In your view agreeing not to hurt one another is, or should be, the fundamental reason people form societies of various kinds. That is only half the story in my view. The other half is that, through co-operation, groups of people can achieve many things they could not accomplish on their own which make them all better off (like sewer systems, legal systems and common defense). Again, this is why no one wants to live on a well stocked desert island despite the guarantee of freedom from violence and coercion. It is implicit in the decision to be a part of a larger society that policy decisions won't always go your way.

Not every city in the world has a proper sewage system. There is always a cost threshold above which it cannot be done. Holdouts raise that cost threshold. In some cases this makes the system not possible at a cost that can be paid, making everyone worse off. Furthermore, without eminent domain, many more people would be able to hold out for higher prices resulting in even fewer cities able to build them at all. No doubt eminent domain can be abused like anything else.

You keep arguing that the anarcho-capitalist system you favor would be better for everyone and provide a competitive advantage to a society that employed it. If that is true then how do you explain the fact that it never evolves and survives in the real world?

The Confederate states did NOT recognize the right of counties, towns, cities and individuals within it to secede from the individual states. Their assertion of the right to secede from the U.S. was a transparent case of special pleading, not an assertion of the larger principle you are advancing here. I really can't see then how you find their position to be morally superior to the North especially with the slavery issue as part of the mix and with the South firing the first shots.

Many, if not most, contracts do not allow for one party to unilaterally withdraw without the consent of the other. The Constitution itself does not address the issue. Like everything else, the founders would have probably disagreed about it. They certainly knew enough history not to expect that secession would be unproblematic.

You have not answered my question about how we should judge the legitimacy of a secession movement in an entity with many people like a state, town, county or city. Especially since you seem to think the answer shouldn't involve majorities which you view as generally "useful only as a proxy for violence." And given the fact that no one alive today was even part of the original contracts that formed the governments of these entities.

Saveyourself writes:

@Greg G - This conversation has been a great pleasure. We are starting to circle though, so let me try to bring our conversation to a close.

Greg wrote, “Not every city in the world has a proper sewage system. There is always a cost threshold above which it cannot be done. Holdouts raise that cost threshold. In some cases this makes the system not possible at a cost that can be paid, making everyone worse off. Furthermore, without eminent domain, many more people would be able to hold out for higher prices resulting in even fewer cities able to build them at all. No doubt eminent domain can be abused like anything else.”

Any use of eminent domain is abuse. You are right about higher prices. You are wrong that those higher prices justify government force against its citizens.


“In your view agreeing not to hurt one another is, or should be, the fundamental reason people form societies of various kinds. That is only half the story in my view. The other half is that, through co-operation, groups of people can achieve many things they could not accomplish on their own…”

Yes. You are correct. We agree on the goal. Where I think we disagree is on how to get there. I cannot predict what projects and policies will produce the greatest gains for the largest number of people at the lowest costs. You say it is city sewers. I say I am not smart enough to know if that is the optimal answer and you aren’t either. Who is that smart? The market. The market is smarter than me..and you…and all the politicians…and even the majority. It is smarter than anything else humans have ever designed or created. Markets combine the expertise and understanding of EVERY individual—not just the majority of them—in a way that benefits EVERY individual (assuming it is Free-Competitive-Informed-Just). The policies I am proposing to you are the policies that get dumb people like me out of the way of the market. Don’t hurt other people, I need them healthy so they can contribute to the market. Don’t regulate people, I need them free to contribute their expertise to the market without fear of government retribution. Don’t steal from people, it makes the market less efficient. Don’t subsidize anything, it distorts the market outcomes. Don’t Lie to people, it introduces noise in the market signals. Don’t erect trade barriers and tariffs, it reduces competition in the market.

“You keep arguing that the anarcho-capitalist system you favor would be better for everyone and provide a competitive advantage to a society that employed it. If that is true then how do you explain the fact that it never evolves and survives in the real world?”

Great question.

The model I am selling to you is an ideal. Societies can move closer to it but cannot achieve it perfectly. The Free-Competitive-Informed-Just market model predicts countries will see a higher standard of living as they approach that ideal and a lower standard of living as they move away from it. The USA was the closest to the ideal for a while and it had the highest standard of living in the world. Since FDR, the USA has moved rapidly away from that ideal and its standard of living is declining as predicted. China, on the other hand, is moving closer to the ideal and its standard of living is rapidly increasing. The USSR saw a rapid and sustained decrease in standard of living following widespread implementation of central planning. The story is the same everywhere. The model is very reliable.

The reason I think the USA—or any country—allows policies that lead to declining living-standards is mostly due to ignorance. The schools are run by the government. Naturally they teach that the government has the answer. To fix America, you first have to fix the schools and that means you have to let the market run them, the government just isn’t smart enough.

Greg G writes:

@SaveyourSelf

You are right about us needing to bring this enjoyable discussion to a close because we are starting to repeat ourselves. Still, I can't resist one more reaction to something new you said in your last post.

You wrote, "Since FDR, the USA has moved rapidly away from that ideal and its standard of living is declining as predicted."

Well, back in the 1930's libertarians were very vocal in predicting that the growth of government programs would cause our standard of living to decline. And in every single year since then they have made the same prediction over and over again even as we have enjoyed one of the most spectacular INCREASES in standard of living in human history since the 1930's.

In the 1930's many people did not have enough to eat. Today the biggest nutrition problem among the poor is obesity. The rich today enjoy a standard of living never approached in human history. The middle class routinely enjoy many, many comforts unimaginable to even the richest Americans in the 1930's. Pointing out the many ways standards of living have increased for everyone is something Russ Roberts is very good at.

Of course you can, and will, claim that things would be much better yet if we had seen some imaginary counterfactual. Everyone can do that. That is the problem with this kind of debate. There is always that escape hatch for all sides.

What you can't do is claim this history as a success story for the predictive accuracy of libertarians.

SaveyourSelf writes:

Fair enough. Predicting the end of the world isn't the kind of thing I want to right about Anyway. Well played.

David H writes:

Thanks for all the podcasts. It would be interesting to hear you touch on the constitutional and economic implications of the Citizens United case, and if we should tax corporations at all.

Seth writes:

I agree that the characterization of Seidman's argument seemed a bit unfair, though I will say based on my recollection of the Seidman podcast, that he didn't help himself that much in preventing that mis-characterization.

But, here's the core of his point, from that podcast:

For those provisions that are worthy of our respect, we ought to follow them because they are worthy of our respect and not because it so happens that people thought they were worthy of our respect several hundred years ago.

I may be putting words in Seidman's mouth, but I think an additional point is that the written legislation that was put into the Constitution to allow it to evolve (e.g. Amendment V) does not match with the emergent evolutionary process (e.g. empowering the judiciary with semi-legislative powers).

What I find strange is that Hayekians, who taught me that law naturally evolves and emerges despite what's written on paper, don't seem to want to accept this point, right, wrong or indifferent.

In summary, I found Seidman's point to be Hayekian and was surprised that Hayekians opposed it. But, I could be wrong...

DG writes:

Wanted to offer a personal thought, Russ. Might be a best practice not to directly mention a previous podcast guest specifically, especially in a negative light. I knew at the time, you were not a big fan of Seidman's position, but you really managed the Seidman podcast with class.

Think it hurts the podcast to then reference the guest later, paraphrase positions without a disclaimer and use it as a building block with the current guest. Just as easy to reference the idea versus the person, especially when he/she is not there to defend his/her positions.

This was an awesome podcast! I had to listen twice it was so densely packed. I offer the above thought because I feel like a stakeholder in your continued success.

Thanks!

SaveyourSelf writes:

Greg, you wrote,"Back in the 1930's libertarians were very vocal in predicting that the growth of government programs would cause our standard of living to decline. And in every single year since then they have made the same prediction over and over again even as we have enjoyed one of the most spectacular INCREASES in standard of living in human history since the 1930's."


I forgot to tell you, the decrease in standard-of-living the Libertarians predicted has already occurred. You just don't feel it yet because the government is borrowing money to prop up our standard-of-living. They have been doing that for a long time. Once the borrowing stops though--and it has to stop eventually—BOOM...we can't ignore it any more.

In medicine we call that "denial." In economics it is called "Keynesianism." Think about it.

Greg G writes:

@SaveyourSelf

And in the prediction business they call this kind of reasoning: "A broken clock is right twice a day."

Economies are always cyclical. What matters is not nominal debt but debt as a percentage of GDP.

Counties have been routinely going into debt to fight wars for all of human history with little correlation between who takes on debt and who sees an increase in standard of living. What is new is going into debt for social programs. England had massive public debt around the time of the American Revolution. And yet the standard of living there has increased until today.

As always, anyone can claim tomorrow will be different. The USA started with a big public debt from the Revolutionary War and saw a steady increase in standard of living until Andrew Jackson fully paid off the national debt. A horrible depression followed.

Luke J. writes:

Thanks Russ, for getting Richard back to Econtalk. It was as stimulating as always.

SaveyourSelf writes:

Greg G.

After a considerable amount of time and a small amount of money, I finally uncovered a reference to a study mentioned in a book I read 6 years ago that your conversation tickled in the back of my mind. It turns out the study is conducted annually so the data posted here is more current than I remembered. The description of this study and its findings rocked my world 6 years ago and started me thinking that Freedom was not a boolean variable, but instead described a wide range of possibilities. It also was my first hint that there were reliable levers that could predict the changes in societal standard of living.

http://www.heritage.org/index/PDF/2011/Index2011_highlights.pdf

Page 5, chart 3 shows the correlation between the Heritage Foundation's “Index of Economic Freedom” and the “Legatum Prosperity Index”. The “Index of Economic Freedom” is a quantitative rating system for economic variables broken out of the Free-Competitive-Informed-Just market model. The “Legatum Prosperity Index” is a hippie-fied version of GDP per capita.

It is my hope that their strong correlation can, at least in part, addresses your concerns about the predictive acumen of the Free-Competitive-Informed-Just market model.

And, in the probable case that there is some overlap between the “Index of Economic Freedom” and the “Legatum Prosperity Index's” variables, I found this link to the 2008 Heritage study which used GDP per Capita rather than the “Legatum Prosperity Index.”

http://thf_media.s3.amazonaws.com/index/pdf/2008/Index2008_ExecutiveSummary.pdf

Page 6, chart 3 is not quite as pretty as its newer counterpart but still appears to show a strong, linear, non-random correlation between the "Index of Economic Freedom" and measured prosperity.

Greg G writes:

SaveyourSelf,

In my opinion, studies like this are hopelessly subjective and wind up discovering little more than the preexisting opinions of their authors. I'm sure if some left wing think tank did a worldwide study measuring "social justice" you would have no trouble seeing that. For example, one of the ways economic freedom is measured here is to simply assume that a larger share of GDP for government means less economic freedom. Even if something is true you don't prove it by assuming it. Here it is simply assumed that more government equals less freedom.

It is especially ironic when those who view themselves as Hayekians suspicious of economic aggregates embrace studies of this kind which purport to measure and rank things like economic freedom to within one tenth of one percent.

I don't see myself as being against economic freedom. I owned my own business almost my entire adult life. My father, my four siblings and my daughter all own or owned their own businesses. I suspect that you and I don't have exactly the same concept of freedom despite sharing a lot of overlapping values.

I think economic freedom and prosperity each cause the other to be more attainable. I do not see a simple straight line causation from one to the other. Thanks for investing all this time in the conversation though.

j fortier writes:

Heard this podcast and liked it.

Was curious enough to come to the website where I started to read this thread.

I read through "saveyourself" initial comment, more or less agreed with the second paragraph (the civil war seems pretty important in this discussion, something I suspect Doctor Epstein would agree with). Then I read the fifth paragraph...

On the one hand (s)he argues:

Slavery would have abolished itself! Slavery, after all, is ridiculously inefficient. The South could not compete with its free market neighbors or the rest of the world using a slave system. The South, left to its own devices, would have eventually collapsed—exactly like the USSR in 1991.

But then goes on to suggest

Lincoln is probably the worst president in all of US-history and a villain of gigantic proportions.

Why you might ask, apparently in part because

he led a brutal and destructive war—decimating the infrastructure of the South and killing 600,000 people

OK... I guess so, but (s)he goes on:

while simultaneously establishing both a precedent for supplanting the Constitution with majority opinion and a precedent for suppressing minority dissent with violence.

Oh!

So violence against slaves is completely tolerable. But somehow, minority dissent, suppressed with a violence that seems completely absent in my day to day activities is intolerable?

Really?

It's hard, and potentially silly to compare suffering, but slavery, particularly as practiced in much ot the pre-war Southern plantations seems clearly an order of magnitude more cruel then any suffering that "saveyourself" (or I, or anyone who has commented here) experiences.

Comments for this podcast episode have been closed
Return to top