A happy ten-year anniversary to the case people love to hate

This month marks the ten-year anniversary of one of the most despised and misunderstood Supreme Court cases: Citizens United v. Federal Election Commission.

I love Citizens United. It stands as perhaps the most important First Amendment decision of the last decade. Yet it’s come to symbolize the illicit marriage between money and power, while what actually happened in the case is largely an afterthought. I remember encountering an enraged signature-gatherer outside a Trader Joe’s a few years ago who was engaged in one of the many campaigns to amend the Constitution to put an end to Citizens United. I thought he might have a coronary when I told him that it was one of my favorite Supreme Court decisions. I deeply regret not asking him if he could rehearse for me the facts of the case. Maybe he would’ve surprised me.

So what did Citizens United actually say? The law at issue banned corporations from using general treasury funds for electioneering, with civil and criminal penalties for corporations that spent money to speak on pressing political issues of the day. The Supreme Court said that a small-time political organization (that happened to be incorporated), Citizens United, could not be banned from publishing a film critical of a presidential candidate. It’s hard to find speech of a higher order of significance than that.

Citizens United held that government cannot ban political expenditures just because people choose to speak through the corporate form. This is a classic example of an old rule–government cannot censor speech based on the identity of the speaker.

Much of the fury over Citizens United is premised on a guttural abhorrence for the corporation. But corporations are just groups of people who have chosen to organize through a particular structure. And most don’t realize that the law at issue in Citizens United also banned unions from using general treasury funds for electioneering communications.

Much of the popular criticism of the case that I’ve seen seems to believe that Citizens United was the first case to establish that corporations had First Amendment rights. It wasn’t. In fact, not even the dissenters in the case would’ve held that corporations lack such rights. That was an uncontroversial and settled matter. And it should be obvious as to why. If corporations don’t have First Amendment rights, then the New York Times doesn’t have First Amendment rights, along with many other media organizations. (I’ve heard the excuse that freedom of the press would still protect media organizations independently, which is a misunderstanding of the freedom of the press, which doesn’t offer greater speech protections to media than non-media).

Citizens United gets a bad break, and I wish it a happy anniversary.

A blatant campaign-finance boondoggle

The City of Seattle is poised to pass a plainly unconstitutional campaign-finance law later this month. The bill would limit contributions to political action committees that are not controlled by or connected to a candidate to $5000 per election cycle. The Ninth Circuit Court of Appeals, which would govern the outcome of any litigation, has already said several times that limiting contributions to independent PACs (meaning independent of a candidate’s campaign) violates the First Amendment.

The rationale is pretty straightforward. Any limit on political spending is a limit on speech, so it must satisfy the First Amendment. In Buckley v. Valeo, the United States Supreme Court said that contribution limits directly to candidates are usually okay because they (arguably) reduce the likelihood of corrupt quid pro quo exchanges between candidates and donors. But Buckley struck down limits on independent expenditures (meaning expenditures that aren’t donated to a candidate but speak independently for or against a candidate). Independent expenditures, unlike direct contributions, are not coordinated or controlled by the candidate, so there is less of a risk that an independent expenditure is actually an illicit quid pro quo. Since limits on independent expenditures restrict speech without actually doing anything to prevent corruption, they violate the First Amendment.

Contributions to PACs that engage in independent expenditures are basically the same as independent expenditures–there isn’t a direct connection to a candidate, so there simply is no genuine risk of corruption. The City of Seattle probably knows this, and they either don’t care or they hope to change the state of the law. I look forward to the forthcoming judicial rebuke.

Really, I find the entire premise behind limits on either contributions or expenditures to be highly dubious. While there are no doubt a few instances where a contribution to a candidate is given in direct exchange for some future favor once the candidate wins office, the vast majority of contributions are not that. They’re donations to support a candidate because his platform reflects the donor’s policy preferences. Most corrupt exchanges of money, when they do occur, almost certainly occur under the table and outside the context of highly regulated campaign contributions. Thus, contribution limits penalize a wide range of legitimate political speech to get at a vanishingly small (and unknowable) number of malefactors.

Defenders of campaign-finance laws tend to emphasize the huge amount of political spending as per se evidence of the need for reform. (When you compare the amount of political spending to other spending in the economy, it becomes quite clear that the amount of money in electoral politics simply isn’t that much). This claim that money in elections is fundamentally bad has always struck me as bizarre. That money is spent by both sides on political speech that informs the public. Why should we assume that this is a bad thing? Of course all political speech has a partisan aim–to convince voters to vote for so-and-so. But the information hardly compels voters to do so. At the end of the day, it seems much better to have a public informed by politically motivated communications than to have less information.

Campaign-finance advocates also like to point out that candidates who receive the most money tend to win. Again, it isn’t obvious why this is a bad thing. It seems rather obvious that popular candidates will attract both dollars and votes, not because they get lots of money, but because they’re popular. This is a classic failure to acknowledge the difference between correlation and causation. To date, no significant evidence has surfaced demonstrating that dollars cause votes.

And what about the concern over undue influence? Of course, politicians may be responsive to high-dollar donors. But again, this is a correlation issue. The NRA gives money to candidates who support the NRA’s  policy preferences. When the candidate reaches office and fights gun control, is it because of the NRA’s support, or was the NRA’s support prompted by the candidate’s pre-existing policy platform? Over and over, the deeply felt convictions of campaign-finance advocates seem to rest on a house of cards.

In any case, even if risk of quid pro quo corruption is a valid reason to restrict speech, Seattle’s bill goes well beyond that rationale. PACs engage in core political speech, as do the individuals who donate to them. That speech merits protection.

The mythology of Lochner v. New York

In the highly competitive world of most misunderstood Supreme Court decisions, Lochner v. New York sits high on the list. The reason is simple enough: it has undergone a transcendent ascent to the world of abstraction, where it now embodies the platonic essence of a black-robed cadre of old, straight, white men hankering to smash the plebeian’s face in the dirt.

Yesterday, the Intelligencer–a publication of New York Magazine–dragged out these old tropes with the galumphing rhetoric typical of someone simply parroting a battered playbook with no real concern for its accuracy. The article is entitled, “Conservatives Want a ‘Republic’ to Protect Privileges.” Its basic premise is to push back against the anti-democratic tendencies of those who oppose direct, untrammeled democracy.

The article lists several “limitations on democracy to justify and even expand privilege.” The second references the conservative legal movement’s supposed attempt to resurrect the “Lochner era,” in order to protect the wealthy from democratic majorities.

First, off, it’s wrong to say that the “conservative legal movement” wants to revive Lochner. Both progressive and conservative jurists are generally united in their rejection of Lochner. Robert Bork, a thoroughly majoritarian conservative, railed against the case, as did Justice Antonin ScaliaGranted, this is because the conservative legal movement, sadly, has largely embraced the progressive juridical project of the 30’s, which was devoted to weakening the judiciary in order to shove the New Deal down the nation’s throat.

Second, Lochner‘s many detractors almost never grapple with the facts of the case. As a result, they frequently misunderstand it. Here’s what actually happened. In the early 1900’s, New York enacted a nitpicky law that saddled bakeries with an avalanche of finite requirements–limits on ceiling heights, limits on the kind of floor, and the demand to whitewash the walls every three months, among other things. But the provision dealt with in Lochner was this: “No employee shall be required or permitted to work in a biscuit, bread or cake bakery or confectionary establishment than 60 hours in one week or more than 10 hours in any one day.”

A Bavarian immigrant named Joseph Lochner who owned a Utica bakery was criminally indicted for violating this law. Aman Schmitter, another immigrant, lived with his family above the bakery and worked for Joseph. Aman happily worked over sixty hours a week in order to care for his family and increase his skills, and he said so in a sworn affidavit.

It is undisputed that New York’s law was not about health, safety, or protecting workers, though New York tried to say so at the time. Rather, New York passed the law at the behest of powerful bakeries and baker unions in a patent attempt to crush small, family-owned bakeries that relied upon flexible work schedules. It gets worse–the law intentionally targeted immigrant bakeries in particular, which tended to be of the small variety that leaned on overtime. The state’s legal brief contained a detestable line that progressives today would certainly associate with Trump: “there have come to [New York] great numbers of foreigners with habits which must be changed.” This is the law that progressives who hate Lochner are defending.

In a 5-4 decision, the Supreme Court thankfully struck down this law that was passed to serve the powerful and crush a weak immigrant population. Put that way, it seems startling that anyone today would wish to stand up for this piece of anti-immigrant, protectionist garbage.

But then again, Lochner is no longer about Lochner. It’s about rejecting a mythical “Lochner era.” Progressives believe that Lochner represented an entire ecosystem of turn-of-the-century jurisprudence in which corrupt judges were smothering the will of the people wholesale. Turns out that era never existed. Law professor David Bernstein has examined old court records concerning state exercises of their police power during that time period and found that there simply was no lengthy period in which courts were whack-a-moling every piece of social legislation that dared to lift its head.

To the extent that courts of that era did strike down social legislation under the liberty of contract, they did so not to serve the wealthy, but to protect weak minorities–which is of course why robust judicial review exists in the first place. For instance, the Illinois state supreme court struck down a deeply misogynistic law limiting women’s maximum work hours. The Court used the same liberty-of-contract reasoning as Lochner, arguing that women “are entitled to the same rights under the Constitution to make contracts with reference to their labor as are secured thereby to men.” And in Bailey v. Alabama, the wicked Lochner Court struck down a Jim Crow law that created a presumption of fraud when a worker quit after getting an advance payment. The law was aimed at penalizing black workers–an attempt essentially to revive peonage. Do progressives really want to own up to disagreeing with these “Lochner era” precedents? Somehow I doubt it.

Lochner did not, as Lochner‘s enemies love to claim, replace the legislature’s judgment with the judgment of the Court. Instead, the Court was willing to look skeptically at the legislature’s motives and demand that the legislature do its work and show that a law burdening a basic right is necessary. The New York law failed that test spectacularly.

Of course, Lochner‘s legacy does demand that courts counter democratic will when it conflicts with fundamental rights. Alexander Bickel famously called this the counter-majoritarian difficulty, something that has preoccupied the judiciary for a century. If you really care about minorities, though, you might consider Judge Janice Rogers Brown’s insight: “But the better view may be that the Constitution created the countermajoritarian difficulty in order to thwart more potent threats to the Republic: the political temptation to exploit the public appetite for other people’s money–either by buying consent with broad-based entitlements or selling subsidies, licensing restrictions, tariffs, or price fixing regimes to benefit narrow special interests.”

In any case, if progressives continue to take a polly-anna view of unfettered democracy despite the evidence, they should at least bother to get the facts right on Lochner.

 

Nike’s speech rights?

Nike’s decision to scuttle the Betsy Ross flag shoe design says so much about how touchy we’ve become as a society. Maybe Nike’s being too politically correct, maybe Nike’s critics are being too outraged. Probably both. What interests me, though, is Arizona’s threat to withdraw financial incentives dangled in front of Nike as an incentive to build a plant in the state. Does this implicate Nike’s free speech rights? I think it might.

The interesting aspect of this scenario is that it features the flip sides of two coins. Rather than being punished for speaking, Nike is being punished for refraining to speak. And rather than punishing my Nike by, say, imposing an additional tax, Arizona is threatening to withdraw an incentive that the state isn’t obligated to provide in the first place.

As to the first point, it has long been clear that expression itself is not the only thing protected by the free speech guarantee. Rather, the First Amendment protects decisions about expression, including the decision not to engage in speech. The unusual aspect of this situation is that the government is not trying to compel Nike to speak a message created by or sponsored by the government. Rather, Arizona is penalizing the company for creating its own expression and then changing its mind. Still, I think this would likely be considered to be part of one’s right not to speak.

As to the withdrawal of incentives, the free speech guarantee forbids the government from placing an unconstitutional condition on a government benefit–i.e., you better sell that shoe with the Betsy Ross flag on it, or you don’t get those tax breaks. Government can’t force someone to waive a constitutional right in exchange for a government benefit.

The other interesting question here is whether Nike’s speech–or lack thereof–would be considered commercial speech, which is less protected than other forms of speech. In a way, the Betsy Ross flag shoe nicely demonstrates why this is a silly distinction–the flag has deep political meaning. Why does it matter that it’s printed on a retail shoe rather than stuck on a sign in someone’s yard?

In any case, it seems like there’s a plausible free speech problem behind Arizona’s overreaction, here. I’m curious to see if anything comes of it.

School choice at the Supreme Court

Another school funding case is knocking at the U.S. Supreme Court’s door. This case, Espinoza v. Walborn, hales from Montana, where the state’s fledgling school-choice program was killed moments after it left the crib. The Court now has a chance to revive it and land a major victory for educational choice across the country.

Montana’s first school-choice law, passed in 2015, took the form of a tax-credit scholarship program. If a taxpayer donated to an approved scholarship organization, she could claim up to $150 of the donation as a tax credit. The scholarship organizations then dished out scholarships to help parents afford to put their kids through private school.

Then the Montana Department of Revenue gutted it. The Department promulgated a rule that none of that scholarship money could go to religious private schools. This basically killed the program, since the vast majority of private schools in Montana–and in most states–are religious schools.

The Department claimed that the state constitution prohibited the scholarship dollars from going to religious schools because of the state ban on indirect public aid to religious schools. This is an absurd argument. The scholarship funds are privately donated dollars–they never touch a public coffer. The fact that someone can claim a tax credit hardly means that the donation becomes “public funds” because of diverted revenue. Such an argument, extended to its logical conclusion, would mean that all money is the government’s, and when it graciously declines to tax us, that extra money of ours is in fact part of the public fisc.

Nonetheless, the government prevailed at the Montana Supreme Court. In fact, the Court did the state one better–they just invalidated the whole tax-credit program, even for the few parents who might use a scholarship to send their kids to a secular school.

It’s a terrible blow to parents in Montana trying to find some genuine variety in education. But it also gives the Supreme Court a chance to right a wrong that has been festering in education policy for well over a century. The Supreme Court should hold that barring religious schools from accessing a neutral and generally available funding program violates the Free Exercise Clause and the Equal Protection Clause of the U.S. Constitution.

The portion of Montana’s state constitution that laid the tax-credit program in an early grave is known as a Blaine Amendment, named after 19th-century Congressman James Blaine. In 1875, Blaine proposed a federal constitutional amendment that would, among other things, prohibit states from funding “sectarian” schools with public money. Blaine’s federal amendment failed, but many states passed state-level amendments to the same effect, and Congress managed to make inclusion of such amendments a condition of statehood for new states entering the union.

The history is clear that these amendments are rooted in anti-Catholic bigotry. As the United States transitioned to a public school system, public schools had a distinctly Protestant flavor (often state-endorsed or even state-forced). Catholic migrants therefore began forming and attending private religious schools of their own. The backlash was fierce, and anti-Catholic sentiment often expressed itself in hostility to Catholic schools. James Blaine’s proposed amendment was a key manifestation of this bigotry.

And the bigotry lives on today. Ironically, however, now opponents of genuine choice in education have retrofitted Blaine Amendments as a partisan weapon to combat vouchers, tax credits, and education savings accounts. Montana’s law is only the most recent victim. If the Supreme Court doesn’t grant this case and strike down these state laws rooted in religious bigotry, it won’t be the last.

Old Property

Property is the basis for every right and ounce of autonomy we have. James Madison called property “that dominion which one claims and exercises over the external things of the world, in exclusion of every other individual.” Madison went on to argue that basically every right we enjoy is reducible to a property right. We have property in our opinions, in the free use of our faculties, in the safety and liberty of our body, and so on. He believed that “Government is instituted to protect property of every sort” and a government can only be just if it “impartially secures to every man, whatever is his own.”

But government has not remained impartial in this endeavor. It has become a massive property owner in its own right.  It has also become a gatekeeper, setting the terms for individuals’ uses of their own property. It has also become a broker and redistributor of property. And finally, it has =become a creator of property in the form of entitlements–what Charles Reich famously called “new property.” It’s this last role that I’d like to discuss here.

Government’s role as a creator of property has muddled and watered down the strength of property rights. The problem began when U.S. courts started grappling with claims that individuals had been deprived of a constitutional right when government stripped them of a government-created entitlement, such as social security.

Courts confronted with this problem basically held that while constitutional rights do attach to entitlements, the government has an increased authority to limit the rights to those entitlements. Essentially, since the government created the entitlement, the government can define the scope and terms of that entitlement.

This “new property” doctrine then became entangled with a different idea altogether. The United States Constitution protects against deprivations of life, liberty, and property without due process of law. The Constitution, however, does not define property. Courts have held instead that state law defines property , and the Constitution then protects rights to that property.

That does not mean, however, that all property can be whisked away at a whim as if it is all “new property.” Rather, even though state law may establish what property is, states do not have the power to mutate and redefine all property rights on a whim. In essence, there is “new property” and then there is “old property.”

“Old property” is a bundle of long-recognized property rights rooted in common law. But just because those rights have arisen from common law courts over the centuries does not mean that these are property rights created by government in the same sense as less-protected “new property.” There is a fundamental difference, for constitutional purposes, between government recognizing a boundary line and creating a food stamp program. In some sense, this difference strikes a deeper philosophical chord, one that distinguishes between positive law and natural law–or fundamental rights that are acknowledged and respected by government, and entitlements that are created and controlled by government.

What are these fundamental property rights? Most are intuitive and understood by babies as soon as their hands are capable of grasping. They include the right to exclude others (the first property right understood by all children everywhere), the right to quiet enjoyment, the right dispose of the property by sale or lease, the right to develop and improve the property, etc. That right extends to chattel and land–things the government does not create but simply exist and are brought under human ownership through a first-in-time rule or a transfer.

The idea that “new property” deserves lesser protection because government dictates its bounds has bled over into the “old property” rights. This stems from confusion between government recognizing the existence of a fundamental right and government creating an entitlement. Extensive permitting regimes have only exacerbated this confusion. When local governments demand a permit before a property owner can do something with their land, the government looks upon that permit as an entitlement–a privilege and not a right. Thus, “new property” ideas come to overlay and suffocate “old property.” As permitting regimes expand, the world of “old property” retracts. But that permit is not a “new property” entitlement–it’s a condition placed upon a fundamental background right–an intruder upon natural law. When a permitting authority tries to strip away or deny a permit, that denial should be subjected to the full rigor of constitutional scrutiny offered to “old property,” not the weak sauce protections for entitlements.

If a government is only just if it limits itself to protecting what is ours, as Madison believed, then we don’t have many just governments left to us. Courts could help by establishing a clearer distinction between the old and the new forms of property so that governments can’t get away with redefining or stripping away fundamental property rights.

Mending Wall

Robert Frost’s lovely poem, “Mending Wall,” says something profound about the importance of the institution of property. The poem is about Frost and his neighbor meeting together to piece together a crumbling wall between their two properties. Frost pokes fun at the tradition; without a wall, will Frost’s apple trees sneak across the property line and gobble up the cones piled up beneath the neighbors’ pines? As the two walk the line, replacing a stone here and a stone there, the neighbor, in an almost ritualistic mantra, responds to Frost’s skepticism with the well-worn line, “Good fences make good neighbours.”

Some can and have interpreted Frost’s poem as a gentle argument against erecting barriers that separate us. I think that’s a mistake. Of course, I admit to overlaying my own political and philosophical views atop his writing. But with that in mind, the poem tells me to that clear property lines do indeed make good neighbors. In fact, this wall is what draws Frost and his neighbor together in a valuable social ritual. Even in the absence of an obvious need for the wall, the tradition stokes good will.

In a broader and more directly political sense, property does indeed make good neighbors. Where property rules are unclear or have not been established, social strife and distrust tend to proliferate. Where they are established by law or custom, parties have a neutral arbiter whose presence alone allows them to avoid dispute and uncertainty.

This seems to hold true on small and large scales. Parents of young children have all learned that allowing kids common ownership of toys is a recipe for constant conflict. If parents establish clear ownership of childrens’ possessions, then order settles in and kids can learn important social values like sharing–a virtue that will never arise if property rules are unclear or non-existent. Truly, in a home of common ownership, children only learn to cling desperately to everything and not give an inch.

The same appears true for communities and nations. Where countries do not have established customs and laws governing property, strife, distrust, and corruption fester (Russia is, unfortunately, a prime example of this problem). A similar phenomenon seems to have played its role in the rapid demise of the various utopian communal arrangements that cropped up during the Second Great Awakening in 19th century America.

Frost’s repeated refrain throughout his poem is: “Something there is that doesn’t love a wall.” I think Frost’s neighbor had the right of it–communities survive and thrive thanks to walls. We should take time to mend them.