Power, Independence, and Guessing

federal reserve facade 2

The Power and Independence of the Federal Reserve is an informative and provocative history of the Fed and its remarkable evolution over a hundred years’ time: a complex institution, in a complex and changing environment.

Very importantly, author Peter Conti-Brown has included the Fed’s intellectual evolution, or the shifting of the ideas that shape its actions as these ideas go in and out of central banking fashion. This account makes readers wonder what new ideas and theories the leaders of the Fed will adopt, reinforce by groupthink with their fellow central bankers, and try out on us in future years.

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Political Correctness Promotes Political Violence

The recent violence at Trump rallies has been the work of protesters, not of his supporters.  I am no fan of Trump, but he has as much right to speak without disruption as any citizen. Indeed, it is even more important to afford him that right than ordinary citizens, because he is the presumptive nominee of one of our two major parties. Violence distracts from the debating his ideas, such as they are, and will create greater political polarization at the expense of deliberation.

Sadly, there is a connection between this violence and the enforcement of political correctness in our educational institutions today.  The disruptive protesters at Trump rallies are almost all young—recent products of our educational system. They are thus steeped in the unreformed religion that dominates our schools—one where error has no rights.

Indeed, when Trump 2016 was chalked on the sidewalk of Emory University,  the administration began an  investigation into who wrote it. More generally, college administrators have permitted events to be cancelled because of the threat of disorder without speaking out against such cancellations.

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When Innovation Collides with Rules, Which Should Prevail?

Businessman drawing on a paper next to green paint splash with blue sky on the background

Regulating cyber-commerce is controversial. The advent of smart phones and web-based interfaces has facilitated many new consumer services. Customers using these digital platforms often insist that existing regulatory models are outmoded and simply shouldn’t apply to new technologies.

As do the companies. When residents of Austin, Texas recently rejected Proposition 1—an ordinance proposed by Uber and Lyft—it generated national attention around this important question: How should a free society deal with innovative new technologies? Should existing regulations apply, should exceptions be made, or should the collision between existing rules and innovation cause us to re-examine the existing rules altogether?

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Trump, Vicious Cycles, and the Possibility of Reform

One of the most interesting aspects of the Trump candidacy is the way in which it involves a Republican (or, if you will, the Republican nominee) employing tactics or promoting programs that are related in some way to those used by the Democrats at times. This makes Trump much less attractive to those who favor limited government.  But it raises the question whether he might be able—unintentionally of course—to raise the consciousness of the Democrats to the problems with their approach.

Start with strong executive power. President Obama and the Democrats embrace strong executive power. There are many reasons for this. One is that the Democrats want a government that can pass large numbers of regulations and is quick-acting. Another is that the Democrats do not want to be limited by the public opinion constraints of the legislature. But, of course, executive power is dangerous and is problematic, especially when one is on the receiving end of it.

While Republican Presidents have used executive power, they have not used it—especially in the domestic sphere—to the extent that Democrats have. And they have not played as fast and loose with the law as President Obama has.

Many people have the impression, not without reason, that a President Trump would be willing to aggressively use executive power. This concerns the Democrats, especially since much of Trump’s agenda is anathema to them. Could this persuade the Democrats that executive power is a dangerous thing that should be constrained?  It is hard to say, but if Trumpian executive power doesn’t persuade them, what would?

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Brexit Costs Versus Brexit Benefits

Austritt Grobritanniens aus der EU

Would Britain gain or lose by leaving the European Union? Is it possible the consequences would be neutral, with the costs and benefits of Brexit cancelling each other out?

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Clinton is a Greater Threat to Constitutional Jurisprudence than Trump

Ilya Somin has disagreed with me that Trump is likely to be better for constitutional jurisprudence than Clinton. But his arguments rely on the implausible premise that Trump is likely to change the jurisprudential commitments of the Republican party. Even more importantly, he does not address the elephant in the room: Clinton’s appointments would likely return us to a Court unconstrained by our fundamental law.

Ilya is right that if Trump could change the Republican’s basic philosophy of judges from originalism to something else, that would itself impose long-term harm to nation. But Trump’s election is unlikely to have this effect. Trump is not coming into power with a parliamentary majority and or even at the head of a well entrenched ideological movement.   The way to think of Trump is that has rented the party for his own ambitions and that he will be forming a coalition with orthodox Republicans who will make up the vast majority of Republicans in the legislature. He is thus going to have to deal with the Republicans who have an independent power base and who hope to be there long after he leaves. That not only includes legislators but the Republican establishment.  And as in coalitions generally, he will focus on the issues most important to him where there is least resistance from his partners.

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Bernie’s Avengers


Situated at the corner of Fairfax and Wilshire in Los Angeles, the iconic Johnie’s Coffee Shop was where Mr. Pink plotted a diamond heist in Reservoir Dogs and where Walter offered to obtain The Dude a toe in The Big Lebowski. But it has never witnessed malfeasance like the villainy that has unfolded there over the last few weeks. Johnie’s has been converted into a hub of unregulated advocacy for Bernie Sanders’ presidential campaign.

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The End of Conservative Ideology?

11/18/1986-Washington, D.C.-: President Reagan talks with William F. Buckley, Jr. prior to a dinner honoring the latter.

In the wake of Donald Trump’s conquest of the Republican presidential nomination, many wise critics have concluded that the old Buckley-Reagan conservative ideology is dead. The paradoxical reply: It is not dead because the original was not an ideology.

That declaration had always annoyed me in my younger days, when William F. Buckley, Jr. would ceaselessly insist that conservatism was not ideological.

Sure it was. What did Buckley himself write in his Up from Liberalism (1959) about the essence of conservatism? Its principles were set forth therein as “freedom, individuality, the sense of community, the sanctity of the family, the supremacy of conscience, the spiritual view of life,” a strong defense—and all were meaningful “in proportion as political power is decentralized.”

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Three Cheers for Litigation Finance and Peter Thiel

The media has suddenly become very concerned about outside financing for litigation. The reason is that such financing is for the first time supporting a well publicized lawsuit against the press. The Silicon Valley mogul Peter Thiel has contracted to provide financial support for a lawsuit against the gossip site Gawker on invasion of privacy grounds.

Litigation financing should be celebrated rather than deplored, because it equalizes access to justice. Some kinds of suits pursue novel or risky claims. Even lawyers on contingency fees may be unwilling to take them for those who cannot pay or they may take an exorbitant cut for their doing so.  But litigation finance can draw on institutional or wealthy investors that can underwrite the risk. Institutional investors finance a portfolio of lawsuits and this diversification permits them to suffer losses in many lawsuits, while still coming out ahead overall.

Thiel, however, is not a diversified investor in lawsuits, but appears to be financing only defamation and invasion of privacy suits against Gawker and similar gossip sites.

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Political Correctness and The Mob: It Didn’t Just Start

This article in the Atlantic discusses the current situation at Yale regarding the Halloween costume controversy. The main event, of course, was the verbal assault of then Master of Silliman College, Nicholas Christakis, by student Jerelyn Luther. The entire article is well worth reading. The ultimate result of the incident is that Nicholas Christakis is no long serving as Master. His wife, Erika Christakis, who shared in the job’s duties and whose email sparked the controversy, resigned her position teaching at Yale. (Ms. Chistakais has recently published a significant book on child-rearing.) It is not entirely clear from the article why the Christakis couple are no longer occupying their positions. It may be due to pressure from Yale or the Yale community or it may be their own decision. But whatever the cause, the message is clear: Don’t mess with the Political Correctness Mob. By contrast, the student, Jerelyn Luther, appears to have graduated without any type of reprimand.

This is a sad story, and one that has been written about at length. Here I just want to note that this type of issue is hardly new, at Yale or in other places. I remember my time at Yale Law School, which exhibited the 1980s version of this intolerance. It was known as hissing. When people voiced comments that the liberal mob disliked, they would collectively hiss.

I can still remember a Federalist Society member, whose has since gone on to become an important academic, announcing an event prior to my tax class taught by Michael Graetz. The mob hissed him.

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