Book Review: Liberty of Contract

Legal System, Non-Fiction Reviews
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Last year saw the release of two books on the U.S. courts’ history of (not) protecting the liberty of contract: David Bernstein’s Rehabilitating Lochner and David N. Mayer’s Liberty of Contract: Rediscovering a Lost Constitutional Right.

My review of Bernstein’s book appeared in the Winter 2012 Independent Review; my review of Mayer’s book has just been published in The Freeman.

Which book is better? I couldn’t say. Both cover a lot of the same ground, and both are well-done. (Oddly, both were published at about the same time, and both appear to have been sponsored by the Cato Institute, though Bernstein’s book was published by the University of Chicago Press.) I recommend either or — if you really want to be an expert on all facets of New York v. Lochner and the courts’ inconsistent protection of economic liberty — both.

Here’s an excerpt from my Liberty of Contract review:

The U.S. Supreme Court has no coherent ideas about—or real respect for—individual rights. It generally allows governments to do whatever they want, with limited exceptions for a handful of rights it has deemed “fundamental,” such as the right to free speech (in some areas) and the right to sexual privacy (in some respects). Other rights, such as the right to economic liberty, receive almost no protection at all.

Why so much protection for some rights and so little for others? Because the Court has arbitrarily said so.

Libertarians, of course, think differently about rights. Libertarians think that our rights exist independently of government, and that if government has any legitimate purpose at all, it is to protect those preexisting rights.

Libertarians also think that all our rights are really property rights. We each own ourselves, and from that follows a right to own private property that we acquire through voluntary exchanges with others. Other rights, such as the right to free speech, derive from our right to use our own property as we see fit. And the right to economic liberty—that is, to trade your property and your labor freely with others—is just as “fundamental” as any other right.

In Liberty of Contract: Rediscovering a Lost Constitutional Right, law professor and historian David N. Mayer shows how Americans went from embracing the libertarian conception of rights reflected (imperfectly) in the Declaration of Independence to the statist conception of rights reflected in modern Supreme Court decisions.

Read the rest.

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Why is it okay to pay an intern $0? or, liberal hypocrisy on the minimum wage

Business, Employment Law, Podcasts, Victimless Crimes
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A recent Slashdot post mentions some NYTimes-style whining about how employers like Apple are “exploiting” their employees by paying them low wages:

Apple Store Employees Soak Up the Atmosphere, But Not Much Cash
raque writes

“The NYTimes is reporting on just how badly Apple Retail employees are being paid. Apple is exploiting its fan base for cheap labor. This is one reason I don’t go to Apple Stores if I can avoid it. Stores like NY’s Tekserve offer a great shopping experience without so exploiting their workers.”

Would you rather start at an Apple store for $11.91 an hour (average starting base pay, according to the linked article) and an employee discount, or at Tiffany for $15.60?

The idea that it’s wrong to offer to pay someone a low wage is rampant. For a recent example, one sage argues, in a Techdirt comment thread, that “Competing by paying your workforce less is not competing, it is cheating.” Marxian “exploitation” ideas like this are at work behind the horrible minimum wage. As Henry Hazlitt explains in Economics in One Lesson (ch. 18), a minimum wage law simply causes unemployment—and it causes it primarily among those who have the lowest valued skills, namely the poor, minorities, handicapped people, and the young. It cuts out the lower rungs of the ladder that people could use to climb to higher levels. One benefit of a job at any price is the skills and learning experience—learning to engage with customers and co-workers, to show up on time, manners, dress code, and so on.

This is, in fact, one reason some people are willing to serve as “interns” for no pay: for the work experience, contacts, resume padding. And this an absurdity in the very idea of the minimum wage: it’s legal to offer to pay someone, say, $10 per hour for a certain job, or more, and it’s legal to offer to pay them $0 per hour (internship), but it’s illegal to offer them something in-between. This is just as absurd as the idea that it’s legal to give away sex but not to charge a monetary price for it (prostitution).

I thought about this when listening to a recent Slate Political Gabfest podcast, which is one of my favorites although the three hosts are liberals. In this episode, around 50:30, host David Plotz mentions that they are looking for a new intern—and that, while it is an “unpaid” position (6-10 hours per week), it leads to “great opportunities” for the interns, who use the experience to find a (real) job elsewhere. Exactly. Even working for nothing makes employment worthwhile for people starting out. It’s a stepping stone to other things. Of course, only middle class or richer kids can afford to work for nothing. Imagine if Slate were permitted to pay, say, $3 or $5 per hour to an intern—far below the curent federal minimum wage of $7.25 per hour—more lower class or poorer kids could perhaps afford to take advantage of intern-type positions. But who cares about them, right? After all, they can always join the military, get on welfare, or sell drugs and then get a free jail cell with three hots and a cot.

As my friend and fellow TLS co-blogger Rob Wicks said to me:

Minimum wage can be a sort of welfare program for the middle class. For those at the upper end of the middle class, working for nothing but experience is a fine investment. But if you are doing it for money, it has to be enough to make it worthwhile for someone already middle class. Their support for minimum wage is not really for the poor. Middle class people with kids just want to make sure their spoiled, largely unmotivated children make enough money at the local coffee shop/burger joint to show up consistently.

 

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Admin Update: Ch-ch-ch-change-e-es! New Host, Community Forums, & More

Admin Updates
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First of all, our apologies to anyone who was inconvenienced or annoyed by any issues with our site recently, especially those who received a rapid-fire blast of several dozen tweets yesterday. We’ve been in the process of moving the site to a new webhost (DreamHost) over the past couple of days. That process is now complete. We have been able to fix some longstanding problems with the site as well as provide you with new features.

The problems with our old WordPress install were caused by how our previous host had set things up after a server move. The blast of tweets was caused by activating our WordTwit plugin on the WordPress install with our new host. A long queue of Twitter announcements for blogposts had built up in the plugin on the old host. For some reason the tweets were being blocked from release to Twitter. When we transferred everything over and activated the plugin, suddenly the block was gone and all those tweets were released at once.

Whatever the problem was with our old host, our WordTwit plugin is working again and we’ll once more be able to push out Twitter announcements of new blogposts automatically when they’re published.

There were a few other issues on the backend of the site that have been fixed, which will make the site easier to maintain.

We’ve dropped the Libertarian FAQ, since it didn’t garner enough interest from our readers and, it turns out, ourselves.

One new feature is that we’ve dropped the “www.” prefix on the url. Minor perhaps, but it’s a nice convenience. Hopefully, the site will be a little faster now as well.

Here’s the biggie:

With our old host we were unable to get our newest feature installed and up and running. We’re now able to offer you community forums where you can discuss myriad subjects from libertarianism and Austrian economics to politics and history and more. The forums are powered by the Simple:Press plugin. It’s similar to a phpBB system, but it’s built right into WordPress, so you only need one user account for the forums and the rest of the site. Come help us get the conversation started!

And please, let us know if you spot anything that might be broken.

 

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George Reisman on Environmentalism

Environment
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I recently published an article in the Quarterly Journal of Austrian Economics which was critical of the work of one George Reisman on the subject of resource economics. Professor Reisman has been kind enough to respond to my article, and although I thank him for taking the time to reply, I find his response rather unconvincing. This article is a rejoinder to his criticism, and will show that his response has both reinforced my original arguments and misunderstood certain claims I made.

I apologize in advance for the length of this response, which is greater than I first anticipated. I pondered whether I should take the time to write it, but given that Professor Reisman does not believe in opportunity costs, I could not justify a lack of reply on the grounds that I had more important matters to deal with. I encourage interested readers to read both my original paper and Reisman’s response, which will reveal that the tone of my article was fair and respectful. I leave it to the reader to determine if Reisman’s response was equally congenial.

Reisman’s response consists mostly of a series of quotations from his book Capitalism, which he claims undermine my criticism. I will show that they do anything but. I would also like to address some of the larger concerns Reisman raises in his introduction and conclusion, which will serve to highlight important confusions.

…

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Problems with the SOPA opponents’ “Digital Bill of Rights”: A Libertarian counter-proposal

Anti-Statism, IP Law, Technology
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From ars technica, a report about a proposal from a couple of Congresscritters who opposed SOPA for a “Digital Bill of Rights,” to help maintain a free and open Internet. The proposal calls for these “rights”:

  1. The right to a free and uncensored Internet.
  2. The right to an open, unobstructed Internet.
  3. The right to equality on the Internet.
  4. The right to gather and participate in online activities.
  5. The right to create and collaborate on the Internet.
  6. The right to freely share their ideas.
  7. The right to access the Internet equally, regardless of who they are or where they are.
  8. The right to freely associate on the Internet.
  9. The right to privacy on the Internet.
  10. The right to benefit from what they create.

This has some promise, but it’s both under- and over-inclusive. Under-inclusive in that it doesn’t call for the abolition of copyright, or for a radical reduction in term and penalties. In fact it suggests copyright is some kind of “right” in its call for “The right to benefit from what they create.” But so long as copyright exists, it is impossible to avoid its free-speech and free-press suppressing effects. There will continue to be a “balance” struck between copyright and First Amendment type rights; i.e., free speech will continue to be chilled and suppressed (see my post “Copyright is Unconstitutional”). It is impossible to have “a free and uncensored Internet,” which the new Digital Bill of Rights calls for, so long as there is copyright. You cannot have both free speech, and copyright.

And it is over-inclusive in that it calls for things like “the right to equality on the Internet” and “the right to access the Internet equally, regardless of who they are or where they are.” These and some other proposals are troubling in that they are not clearly limits on government behavior, but potential authorizations to the government to limit private actors. For example these provisions could be used by the state to regulate private companies in the name of “net neutrality” or to provide some kind internet access as a positive welfare right or privilege. (See my posts Net Neutrality Developments and  Internet Access as a Human Right.)

Congress should not be declaring “rights,” since it can then serve as a source of power to the feds to regulate private activity, much as the federalizing of the Bill of Rights by way of the Fourteenth Amendment has served not to limit federal power but to extend it to regulating state laws. Congress should do nothing but limit its own power, since it is the federal government that is itself the biggest threat to Internet and digital freedoms.

A better, simpler, more effective, and less dangerous proposal would read something as follows:

  1. Copyright law is hereby abolished [or its term reduce to 5 years and statutory damages eliminated].
  2. Congress shall have no power to regulate or tax activity on the Internet, including gambling or commerce.

Here’s the ars technica piece:

 

SOPA opponents unveil “Digital Bill of Rights”

Sen. Wyden and Rep. Issa want to protect digital citizens.

by  – June 12 2012, 3:07pm CDT

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