“Courting Business”: Scalia Worked Hard To Deny Ordinary Citizens Their Day In Court
In Antonin Scalia’s thirty years on the Supreme Court, his name became a byword for social conservatism. And when Senate Majority Leader Mitch McConnell announced that the Senate would refuse to consider any replacement President Obama nominates it was natural that opponents of same-sex marriage and abortion were relieved. Yet Scalia’s death will have only a limited impact on the culture wars, because regarding many social issues he was already in the minority on the Court. But there is one area where the question of his replacement has huge consequences: business. As a member of the Court’s conservative majority, Scalia played a key role in moving American law in a more corporate-friendly direction. Now that majority is gone, and a huge amount rides on what happens next.
Under Chief Justice John Roberts, the Court has not gone as far in limiting government power over the marketplace as many conservatives would have liked. But the Roberts Court has been the most pro-business of any since the Second World War, according to a paper by the law professors Lee Epstein and William Landes and Judge Richard Posner that looked at decisions from 1946 to 2011. Its five sitting conservatives, including Scalia, ranked among the ten most business-friendly Justices of that period. The Roberts Court hasn’t just made a lot of pro-business rulings. It has taken a higher percentage of cases brought by businesses than previous courts, and it has handed down far-reaching decisions that have remade corporate regulation and law. In Citizens United, it famously ruled that corporations had free-speech rights and that many restrictions on corporate spending in elections were therefore unconstitutional. It has overturned long-standing antitrust restrictions. It has limited liability for corporate fraud and made it harder for workers to successfully sue for age and gender discrimination. It has made suing businesses and governments more difficult, especially in class-action suits.
This is no accident. Since the Reagan Administration, Republican Presidents have filled the Court with Justices steeped in the ideology of the conservative legal movement. As Brian Fitzpatrick, a law professor at Vanderbilt who once clerked for Scalia, told me, “Conservative Justices start from a world view that says we have too much litigation in general and it’s a sap on the economy.” Conservative nominees to the Court have been far more worried about government overreach than about corporate misbehavior. They have been skeptical of the use of class-action suits to achieve social goals or enforce regulations. And, once corporations recognized that the Court was predisposed to favor their interests, they began pursuing those interests more aggressively. As the legendary N.Y.U. law professor Arthur R. Miller told me, “The business community smelled blood and went after it.” Most notably, the Chamber of Commerce has become assiduous in pushing corporate cases to the Court.
A few of these cases have received a lot of attention, but the most consequential work of the Roberts Court in protecting corporate rights has been in cases that have gone mostly unnoticed, including a pair (A.T. & T. v. Concepcion and American Express v. Italian Colors) in which Scalia wrote the majority opinion. In these cases, both of which turned on an interpretation of a once obscure 1925 law, the Court ruled that companies could require customers to give up their right to sue in open court, with disputes to be settled by a private arbitrator instead. “These cases don’t get people’s attention the way things like abortion and same-sex marriage do,” Miller said. But, if the decisions stand, Fitzpatrick argues, “they have the potential to literally wipe out the class-action lawsuit.”
That might not sound like a bad thing—we’re always hearing that Americans are too litigious—but, in an era when regulators are routinely falling down on the job, lawsuits play a crucial role in deterring corporate misbehavior. Miller calls them a “private enforcement of public policies.” And when it comes to big corporations class-action suits are often the only kind that make any economic sense. If every individual defrauded by a company loses fifty dollars, the collective harm can be immense, but it’s not worthwhile for any single victim or lawyer to bother. Fitzpatrick says that obstacles to filing class-action lawsuits make it more likely that “companies will not be held accountable for hurting people, for cheating people, for defrauding people, for discriminating against people.” In that sense, the battle over access to the courtroom is, as Miller puts it, “a kind of class conflict between ordinary individuals and corporate power.” And in that conflict there’s no question which side Scalia was on.
Of course, there’s no guarantee that his death will change things. But many of the Roberts Court’s most important business cases were decided by a 5–4 margin, with the five conservative Justices voting as a bloc. And, as Fitzpatrick points out, “Scalia has done more than any other justice in making it difficult for consumers and employees to bring class-action suits. So his absence alone may make a difference.” There have already been signs of this: just last week, Dow Chemical settled a major class-action suit, saying that Scalia’s death increased the chances of “unfavorable outcomes for business.” It’s unlikely that Scalia will be replaced anytime soon. But let’s hope that, when a successor is finally appointed, it is someone willing to give ordinary citizens the day in court that Scalia worked so hard to deny them.
By: James Surowiecki, Financial Page, The New Yorker, March 7, 2016 Issue; Posted March 1, 2016
“The Great Fracturing Of The Republican Party”: Appears To Believe In Anything, Which Is The Same As Believing In Nothing
It is no longer possible to think of “the Republican Party” as a coherent political force. It is nothing of the sort — and the Donald Trump insurgency should be seen as a symptom, not the cause, of the party’s disintegration.
I realize this may seem an odd assessment of a party that controls both houses of Congress, 32 governorships and two-thirds of state legislative chambers. The desire to win and hold power is one thing the party’s hopelessly disparate factions agree on; staunch and sometimes blind opposition to President Obama and the Democrats is another. After those, it’s hard to think of much else.
It makes no sense anymore to speak of “the GOP” without specifying which one. The party that celebrates immigration as central to the American experiment or the one that wants to round up 11 million people living here without papers and kick them out? The party that believes in U.S. military intervention and seeding the world with democratic values or the one that believes strife-torn nations should have to depose their own dictators and resolve their own civil wars? The party that represents the economic interests of business owners or the one that voices the anxieties of workers?
All of these conflicts were evident Tuesday night at the presidential candidates’ debate in Las Vegas. It was compelling theater — Trump mugging and shrugging for the cameras, Jeb Bush gamely steeling himself to go on the attack, Sens. Ted Cruz (Tex.) and Marco Rubio (Fla.) waging a one-on-one battle, New Jersey Gov. Chris Christie vowing to shoot down Russian jets over Syria, Ben Carson turning “boots on the ground” into a mantra without actually saying what he thinks about deploying them.
A Republican optimist might praise the candidates for airing “serious” and “important” policy debates. A realist would say this is a party that appears to believe in anything, which is the same as believing in nothing.
One of the more telling exchanges came when Trump was asked whether the United States was safer with dictators running the troubled nations of the Middle East. Trump replied, “In my opinion, we’ve spent $4 trillion trying to topple various people that frankly, if they were there and if we could have spent that $4 trillion in the United States to fix our roads, our bridges, and all of the other problems; our airports and all of the other problems we’ve had, we would have been a lot better off, I can tell you that right now.”
Carly Fiorina was aghast. “That is exactly what President Obama said,” she declared. “I’m amazed to hear that from a Republican presidential candidate.”
Indeed, there once was broad consensus within the party about the advisability and legitimacy of forcing “regime change” in pursuit of U.S. interests. But toppling even such a monster as Syrian dictator Bashar al-Assad is opposed by Trump, Cruz and Sen. Rand Paul (Ky.) — who combined have the support of 51 percent of Republican voters, according to the RealClearPolitics polling average. So apparently there isn’t a “Republican view” about foreign intervention anymore.
Nor is the party able to agree on immigration policy. Even if you somehow manage to look past Trump’s outrageous call for mass deportation, there is no consensus for the course of action favored by what’s left of the party establishment, which would be to give undocumented migrants some kind of legal status. The only point of concord is the allegation that Obama has failed to “secure the border,” which is actually far more secure than it was under George W. Bush.
Once upon a time, the Republican Party’s position on a given issue usually dovetailed nicely with the views of business groups such as the U.S. Chamber of Commerce. But the chamber supports giving the undocumented a path to legal status. It also waxes rhapsodic about the benefits of free trade for U.S. firms and shareholders. Now, since Trump opposes the Trans-Pacific Partnership pact (as does Mike Huckabee), other candidates have had to mumble about waiting to see the details before deciding pro or con.
The GOP electorate has changed; it’s whiter, older, less educated and more blue -collar than it used to be. Many of today’s Republicans don’t see globalization as an investment opportunity; they see it as a malevolent force that has dimmed their prospects. They don’t see the shrinking of the white majority as natural demographic evolution; they see it as a threat.
One of our two major political parties is factionalized and out of control. That should worry us all.
By: Eugene Robinson, Opinion Writer, The Washington Post, December 17, 2015
“A Brief Respite From Madness”: Two Problems With The Boehner Atonement Theory
So even as laurels continue to be thrown towards John Boehner on the theory that he’s sacrificed his career to prevent a government shutdown–and hey! maybe save Eximbank and the Highway Bill!–a more serious look at what’s likely to happen next is far less inspiring. The premier budget wizard, Stan Collender, issued this judgment at Politico:
House Speaker John Boehner’s resignation last Friday steeply reduced the likelihood there will be a government shutdown this week but precipitously increased the possibility of a shutdown in December.
And the idea that some sort of Era of Good Feelings Sayanora Tour for Boehner will enable the enactment of long-stalled agenda items of the U.S. Chamber of Commerce isn’t necessarily all that viable either, because the House isn’t the only problem:
[E]ven if the rumors are true about Boehner being willing to work with Democrats to deal with a wide variety of legislative issues (Export-Import Bank, highway trust fund, full-year CR, tax extenders) before he leaves at the end of October, it’s not clear that McConnell will have the political freedom or votes to move these bills. It’s not hard to imagine Sen. Ted Cruz (R-Texas) setting up the equivalent of a campaign office on the Senate floor and, along with other hard-line conservatives, attempting to prevent anything from passing.
And once Boehner really is gone, there’s no reason to assume the atmosphere in the House will get any less poisonous, particularly if conservatives secure an Enforce the Hastert Rule Pledge from the new leadership team:
[D]on’t expect the next speaker to be any more successful at taming the GOP’s tea party wing when the short-term CR expires in December. The new speaker and the rest of the leadership team will just be learning their jobs as they face the toughest issues in the most difficult political environment of the year. It’s possible—and maybe even likely—that they’ll fare worse than Boehner.
So the John Boehner Atonement Theory I’ve been mocking every chance I get is wrong in two respects. First, the man hasn’t sacrificed a damn thing; he gets to spend a year at his Florida golf resort condo before becoming one of the richest lobbyists ever. Second, he didn’t buy his party much of anything other than a brief respite from madness.
By: Ed Kilgore, Contributing Writer, Political Animal Blog, The Washington Monthly, September 29, 2015
“They Should Stop And Take A Second Look”: Ending Forced Arbitration Is A No-Brainer For Conservatives
The Obama administration is preparing to issue consumer protection regulations that will force Republicans to choose between their Wall Street allies and the Seventh Amendment right to a jury trial in civil cases. Republicans will be tempted to denounce the new rules as yet another example of this president’s customary imperial overreach, but on this issue, they should stop and take a second look.
The problem is called forced arbitration, and if you’ve ever taken the time to read a consumer service contract or end-user license agreement before signing it (which makes you an admirable human being, and very rare), you’ll almost certainly have seen a clause that revokes your right to go to court in case of a breach of the agreement by the corporation.
Such clauses are found everywhere, from credit cards and checking accounts to cable TV and car rentals. When you sign, you agree to accept the decision of a private, for-hire arbitrator. Unfortunately, the arbitrator is usually hired by the same company that breached the agreement and is not legally required to follow statutory or common law precedents. Its decisions are almost impossible to appeal. Most consumers have no idea that’s what they’re agreeing to.
Enter the Consumer Financial Protection Bureau, which has been authorized by Congress to step in to study this problem and, based on its findings, restore Americans’ ability to hold financial institutions accountable. Under the Dodd-Frank Act of 2010, the bureau is authorized to issue regulations that limit or ban the use of forced arbitration in consumer financial services and products. Regulations to do just that are expected to be promulgated sometime this year.
The regulations may turn out to be poorly framed or excessive – we’re talking about the same administration that gave us Lois Lerner and executive amnesty, after all – but the problem Congress wanted the agency to address is real.
Recently, while traveling to Topeka on business, I needed to rent a car. I stopped at the Thrifty counter at the Kansas City airport. While filling out the usual paperwork, I asked the gentleman behind the counter, “What happens if I don’t check this box that says I waive my right to sue?” He blinked at me uncomprehendingly for a moment and then replied, “Um, it means you don’t get the car.” I checked the box, disgusted. My destination was 80 miles away, I was in a hurry, and I didn’t have time to haggle or shop around with Thrifty’s competitors, all of whom undoubtedly have the same policy.
Today, a big company like Thrifty can effectively insist that we waive our Seventh Amendment rights on a “take it or leave it” basis; and market forces are not sufficient to police the problem. We’re stuck. And it isn’t just car rentals. When you buy a hair dryer or click “I agree” to a software download, you’re probably forfeiting your right to go to court.
Statistics show that, more often than not, the arbitrator hired by the company you’re disputing with will rule in the company’s favor, likely because he’s eager to be hired again by that company in the future.
Even consumers who think they understand what they’re signing usually have no clear idea of how arbitration really works. They mistakenly equate it with mediation or some other court-like procedure. In reality, forced arbitration is conducted in secret and lacks the procedural safeguards that allow consumers to prove their case. Arbitrators typically keep their reasoning private, making it hard for the losing party to know why he lost, and results are rarely published, making it difficult for similarly situated parties to know they’re entitled to relief.
To be sure, arbitration can be a great option when it’s voluntarily agreed to by both parties after a dispute has arisen, but to be truly voluntary, all parties need to be free to say no. In the case of consumer financial services and products (the kinds of agreements the Consumer Financial Protection Bureau is authorized to regulate), most individual consumers have no bargaining power, as anyone who’s tried to negotiate with his credit card company can attest.
Voluntary arbitration agreements have always been lawful, but up until the 1920s pre-dispute arbitration clauses like the one I had to sign at Thrifty were rarely enforced by American courts. Americans have long cherished the common-law right to a jury trial in civil cases. Indeed, preserving that right was one of the top demands of the Antifederalist skeptics of the proposed Constitution, and the Seventh Amendment was ratified precisely to preserve that ancient right in the courts of the newly constituted federal government.
In 1925, Congress enacted the Federal Arbitration Act to make arbitration a viable alternative for resolving contractual disputes between corporations. That strikes me as constitutionally tolerable, so long as agreements are voluntary and the parties are of roughly equal bargaining power, and if recourse to the courts is still possible if the arbitration process itself is disputed. But recent interpretations of that act by the U.S. Supreme Court have expanded its reach to cover all kinds of contracts, including consumer and employment contracts, and have even overridden state-level laws permitting class actions. (One of the reasons most corporations favor arbitration is that it forces each claimant to pursue his claim individually.)
So in disputes between individual Americans and big companies, the Seventh Amendment has become Swiss cheese, and with more holes than cheese. Many genuinely aggrieved consumers are being denied access to the civil justice system.
How can we fix this? The Supreme Court should reverse its errors, and Congress should amend the Federal Arbitration Act to ensure agreements are truly voluntary. (A bill to do that, dubbed the Arbitration Fairness Act, has been introduced in recent Congresses, but has gone nowhere, thanks to fierce opposition by the U.S. Chamber of Commerce.) Realistically, in the near term, the Consumer Financial Protection Bureau’s forthcoming Dodd-Frank regulations are the best hope consumers have for relief. But that only applies to consumer financial services and products. So there’s no avoiding a legislative remedy.
This issue should be a no-brainer for conservatives. Ending the un-American practice of forced arbitration should be on the agenda, not just of traditional consumer advocates, but of everyone who loves liberty and the Bill of Rights. As a freedom issue, it’s right up there with things like repealing health care mandates, allowing cell-phone unlocking, ending corporate subsidies and eliminating cronyist tax breaks.
By: Dean Clancy, Thomas Jefferson Street Blog, U. S. News and World Report, April 17, 2015
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