So here's a new one - the problem of "zombie properties" - a name that seems to designed to obscure rather than illuminate. An entire front page article in this week in the Journal Sentinel yielded almost no information. Why are there 400 houses in foreclosure that no one wants? The article treats this as a mystery. But that can't be.
Here's the problem. Banks lend money to people to buy houses and they do not repay the loan. The houses go into foreclosure but the process takes forever and in the meantime the properties are left to deteriorate and this causes problems in the neighborhood.
One can imagine two contending explanations. The first is that the whole lending process became too complicated. A bunch of hubristic whiz kids thought they could eliminate risk through algorithms rather than traditional tools like underwriting and requiring down payments. This involved creating a complicated ownership structure for packaged loans - so no one would be exposed to excessive risk - that is hard to unravel. For these inner city properties, where the homeowners have the least to lose by walking away and the economics of rehabilitation and resale are the toughest, this leads to homes where not only the owner but the very project of foreclosure, rehabilitation and resale is underwater. At some point, it is literally in no one's interest to reclaim the house and it is razed.
My guess is that there is some truth in this, but it is a second order explanation. How did it happen in the first place?
Here's a possible answer. We don't need concepts like the living dead to explain this. Indeed, there is a sense in which the metaphor is exactly wrong. The problem is not that these properties refuse to die but that there are truly and completely dead, yet maintained on life support. They are victims of the fiction that they still belong to the people that bought them. Legally, they do. Economically, they don't and may never have.
On this view, the problem is that there are no real property interests in these homes. The owners don't have one because they probably paid little down and, in any event, have no equity interests in the property. In a misguided attempt to promote home ownership, people were encouraged to buy properties that they not only couldn't afford but in which they had nothing to lose. This was not home ownership in the real sense; it was speculation for those who could least afford it.
The lenders don't have a property interest because they required almost nothing down and lent to people who couldn't really afford the home. As a result, they can't hope to get their money back through foreclosure and resale. Although you might expect the bank to move to cut its losses, the cumbersome nature of the foreclosure process - full of procedural requirements to protect the consumer - raise the transactional costs of recovering the property. It doesn't take long - foreclosed properties are notoriously abused by "owners" with no real interest to them - before many of these properties may not be worth reclaiming. While the city's Department of Neighborhood Services may not understand why the lenders don't figure out how to move faster to recover the properties, it's really not that hard to figure out.
I understand that we are supposed to chalk this all up to greed, but there are problems with that. It is not a good strategy - if you want to accumulate wealth beyond the dreams of avarice - to lend money to people who can't pay it back. While the desire to make money in a booming market can cloud one's judgment about the creditworthiness of a debtor, that's not all that was going on here.
Part of the problem is the government encouraged this type of lending. It threatened lenders with enforcement actions if they were "too strict" and imposed obligations to affirmatively further affordable housing. (Remember Barney Frank's infamous inclination to "roll the dice" on affordable housing?) Even when there was no legal requirement to provide affordable housing a lot of lenders found it expedient to accommodate organized pressure to make such loans - just as it is ofter easier today to pay tribute to activists for "sustainability" and "diversity."
To be sure, unscrupulous originators took advantage but there had to be something - a willingness to make subprime loans with insufficient collateral - for them to take advantage of in the first place. And, while the housing collapse was limited to this segment of the market, it is in this segment of the market that a collapse in values is most likely to lead to houses that not literally no one wants. Perhaps there are zombie homes being razed in Mequon and Brookfield, but I haven't yet heard of them.
If this second hypothesis is true, we have quite the irony.
These were policies that left-wing community organizers organizations and liberal politicians supported. Like Mary Shelley's Frankenstein was a product of scientific hubris gone wrong, the zombie properties are of their own making. "Organizing" does not make what won't work viable.
My guess is that the preferred solution of the left wing organizations like Common Ground would be to try to somehow - through litigation or legislation or negotiation - get the banks to throw good money after bad. Some form of reinvestment in these properties - perhaps subsidized - may be warranted but you have to understand the cost of doing so. Making the banks responsible for neighborhood decline is likely to keep the banks out of the neighborhood from now on. Once bitten, twice shy. Selling homes to people who still can't afford them and who will still be required to put little or no money down will work no better this time than it did before. There needs to be another model - one that requires homeowners to have more of a stake in a neighborhood. That will require demanding more.
But before you get there, someone has to reacquire the properties. It seems like the city and banks are playing a game of chicken. I think I know who'll win that.
Cross posted at Purple Wisconsin.
Saturday, May 31, 2014
Friday, May 30, 2014
All Doe all the time, part one
My op-ed in Sunday's Crossroads on the current sorry state of the permanent John Doe investigation into one side of our political divide can be found here. I elaborated on the rumors of settlement negotiations here. More on that later.
A few responses to points made in the comments to the op-ed.
First, I am taking no position on whether anyone has or has not acted unethically. Not everything can be reduced to a morality play. I am saying that the decision to pursue this reflected an insufficient regard for First Amendment values and poor judgment about what can and cannot be accomplished in this way. Whether it was accompanied by unethical behavior or was partisan is something I'll leave to others.
Second, I am not overly impressed that the investigation was purportedly blessed by the GAB. To get approval of a superintending agency of retired and (very) part time judges does not overcome the glaring problems with the investigation. An appeal to authority can't trump what is right before our eyes. (The same thing applies to the formal cooperation of other DAs.)
In any event, it may be that the Doe was not initiated but joined by the GAB and at least in a departure from - if not in violation of - its statutorily mandated procedures.
By way of counterpoint (an appropriate thing to do), the Journal Sentinel ran a column by Bill Lueders which had originally appeared online. He begins by referring to Sen. Mike Ellis' recent lubricated soliloquy - caught on tape by an investigative journalist - to create an outside group to attack his opponent.
Lueders suggests that everyone assumed that Ellis' plan - which he never carried out - would be illegal. He argues that Judge Randa's decision shutting down the John Doe because the state cannot constitutionally restrict issue advocacy changes that - that it "alters the campaign landscape" in some fundamental way.
I do think the decision is an important doctrinal clarification, but it may not mean that what Ellis talked about would be legal.
What Randa said is that the state may only restrict express advocacy. As defined by the United States Supreme Court, this is speech that is susceptible of no interpretation other than as a call to elect or defeat a candidate.
It is unclear whether Ellis' cocktail hour disquisition referred to express advocacy. Issue advocacy can be - and usually is - critical of a candidate but does so only in the context of taking a position on some issue. While some people think of this as a distinction without a difference, robust protection of freedom of speech requires that people - and organizations of people - have the right to speak freely about issues at election time - even if that means highlighting the position of elected officials and candidates.
The rest of the horribles paraded by Lueders are just wrong. For example, the claim of Paul S. Ryan of the Campaign Legal Center that outside groups could pay for a candidate's campaign staff, rent and food bills is ridiculous. Randa's decision does not say that express advocacy is the only form of in-kind campaign contribution that can be made by an outside group. It says that issue advocacy is - unlike paying rent or salaries - constitutionally protected and cannot become less protected because of some degree of coordination with a candidate.
Cross posted at Purple Wisconsin.
A few responses to points made in the comments to the op-ed.
First, I am taking no position on whether anyone has or has not acted unethically. Not everything can be reduced to a morality play. I am saying that the decision to pursue this reflected an insufficient regard for First Amendment values and poor judgment about what can and cannot be accomplished in this way. Whether it was accompanied by unethical behavior or was partisan is something I'll leave to others.
Second, I am not overly impressed that the investigation was purportedly blessed by the GAB. To get approval of a superintending agency of retired and (very) part time judges does not overcome the glaring problems with the investigation. An appeal to authority can't trump what is right before our eyes. (The same thing applies to the formal cooperation of other DAs.)
In any event, it may be that the Doe was not initiated but joined by the GAB and at least in a departure from - if not in violation of - its statutorily mandated procedures.
By way of counterpoint (an appropriate thing to do), the Journal Sentinel ran a column by Bill Lueders which had originally appeared online. He begins by referring to Sen. Mike Ellis' recent lubricated soliloquy - caught on tape by an investigative journalist - to create an outside group to attack his opponent.
Lueders suggests that everyone assumed that Ellis' plan - which he never carried out - would be illegal. He argues that Judge Randa's decision shutting down the John Doe because the state cannot constitutionally restrict issue advocacy changes that - that it "alters the campaign landscape" in some fundamental way.
I do think the decision is an important doctrinal clarification, but it may not mean that what Ellis talked about would be legal.
What Randa said is that the state may only restrict express advocacy. As defined by the United States Supreme Court, this is speech that is susceptible of no interpretation other than as a call to elect or defeat a candidate.
It is unclear whether Ellis' cocktail hour disquisition referred to express advocacy. Issue advocacy can be - and usually is - critical of a candidate but does so only in the context of taking a position on some issue. While some people think of this as a distinction without a difference, robust protection of freedom of speech requires that people - and organizations of people - have the right to speak freely about issues at election time - even if that means highlighting the position of elected officials and candidates.
The rest of the horribles paraded by Lueders are just wrong. For example, the claim of Paul S. Ryan of the Campaign Legal Center that outside groups could pay for a candidate's campaign staff, rent and food bills is ridiculous. Randa's decision does not say that express advocacy is the only form of in-kind campaign contribution that can be made by an outside group. It says that issue advocacy is - unlike paying rent or salaries - constitutionally protected and cannot become less protected because of some degree of coordination with a candidate.
Cross posted at Purple Wisconsin.
Monday, May 26, 2014
More reflections on Brown and the "Iron Ring"
As I noticed in my last post here, back to the future seems to be a norm in politics.
Last weekend, the local left pretended it was 1954 on questions of racial balance in school. My Purple Wisconsin colleague Jim Rowen chose to genuflect before a time honored relic of the American left - the so called "iron ring" thrown around Milwaukee in the 1950s.
The "iron ring" amounted to this. The state prevented the city from forcing proximate local communities from joining the city against their will. In this, it did anticipate much of our current controversy over regionalism. Advocates of the city seem to believe that support for the city means forcing others to pay for whatever stupidity city politicians want to promote. It's never going to happen.
But the larger point is that the "iron ring" was drawn too late. As Russell Knetzger pointed out in last Sunday's Crossroads, Milwaukee nevertheless managed to annex huge amounts of real estate. For its population and age, the city has a huge geographic footprint. I'm not sure if there are still farms within the city limits, but - as recently as thirty years ago (over a period in which city population has been more or less stable) - there were.
In my last point, I wrote about the second generation school desegregation litigation in the 80s. One of the points that the defense made in that case was Knetzger's. The city managed to annex huge swaths of real estate to the north and west of the city center. Indeed, we introduced piles of materials from the 50s and 60s that Milwaukee promoted this area as "the suburb in the city." Indeed, an earlier use of the term "iron ring" was to say the the city would not provide services such as water (as if Milwaukee owns the lake; an odd position for public trust zealots) to suburban communities.
The African American population moved into this area - in a pie shaped pattern emanating from the city center. This is not unique to Milwaukee. We introduced evidence that showed the exact same pattern of black outmigration patterns in every other midwest industrial city. People who live an area of initial settlement do not disperse randomly. They tend to remain in proximity to friends and families. Indeed, that type of outmigration is not limited to African Americans. Other ethnic groups have followed a similar -albeit less pronounced - pattern and there is evidence of Hispanic migration to the southwest.
That this population remained in the city is evidence of how much the city was permitted to expand - generally over the opposition of those brought within its borders.
I understand that it is doctrine among the local left that this opposition can be dismissed as racist, This is reductive and lazy. People moved to the suburbs because they wanted a new house and a yard. They did not wish to remain in the city because they wanted self-determination for their new communities.
I understand that, for folks like Jim, self-determination that allows people to avoid paying for his policy preferences is anathema. Maybe he's right. But folks who take exception are not racist for them.
Cross posted at Purple Wisconsin.
Last weekend, the local left pretended it was 1954 on questions of racial balance in school. My Purple Wisconsin colleague Jim Rowen chose to genuflect before a time honored relic of the American left - the so called "iron ring" thrown around Milwaukee in the 1950s.
The "iron ring" amounted to this. The state prevented the city from forcing proximate local communities from joining the city against their will. In this, it did anticipate much of our current controversy over regionalism. Advocates of the city seem to believe that support for the city means forcing others to pay for whatever stupidity city politicians want to promote. It's never going to happen.
But the larger point is that the "iron ring" was drawn too late. As Russell Knetzger pointed out in last Sunday's Crossroads, Milwaukee nevertheless managed to annex huge amounts of real estate. For its population and age, the city has a huge geographic footprint. I'm not sure if there are still farms within the city limits, but - as recently as thirty years ago (over a period in which city population has been more or less stable) - there were.
In my last point, I wrote about the second generation school desegregation litigation in the 80s. One of the points that the defense made in that case was Knetzger's. The city managed to annex huge swaths of real estate to the north and west of the city center. Indeed, we introduced piles of materials from the 50s and 60s that Milwaukee promoted this area as "the suburb in the city." Indeed, an earlier use of the term "iron ring" was to say the the city would not provide services such as water (as if Milwaukee owns the lake; an odd position for public trust zealots) to suburban communities.
The African American population moved into this area - in a pie shaped pattern emanating from the city center. This is not unique to Milwaukee. We introduced evidence that showed the exact same pattern of black outmigration patterns in every other midwest industrial city. People who live an area of initial settlement do not disperse randomly. They tend to remain in proximity to friends and families. Indeed, that type of outmigration is not limited to African Americans. Other ethnic groups have followed a similar -albeit less pronounced - pattern and there is evidence of Hispanic migration to the southwest.
That this population remained in the city is evidence of how much the city was permitted to expand - generally over the opposition of those brought within its borders.
I understand that it is doctrine among the local left that this opposition can be dismissed as racist, This is reductive and lazy. People moved to the suburbs because they wanted a new house and a yard. They did not wish to remain in the city because they wanted self-determination for their new communities.
I understand that, for folks like Jim, self-determination that allows people to avoid paying for his policy preferences is anathema. Maybe he's right. But folks who take exception are not racist for them.
Cross posted at Purple Wisconsin.
Monday, May 19, 2014
Here are some more reflections on Brown
If you wait long enough, just about every debate will be repeated.
Sunday's Journal Sentinel was themed around "resegregation" on the 60th anniversary of Brown v. Board of Education a story. The most interesting of several articles on the subject was a treatment of the increased lack of racial balance in MPS and the idea that this is sometime of "boomerang" effect of recent or sinister provenance.
In fact, the recognition that MPS would be unable to keep counting noses by their color was raised thirty years ago. As a rookie lawyer. I became involved in the "second generation" school desegregation litigation. It followed a rather contrived and result oriended decision by Judge John Reynolds holding that there had been intentional racial segregation by MPS that justified racial balancing in the city's schools.
Reynolds meant well - he was a creature of his age - but that decision destroyed, at least for awhile, the neighborhood school in Milwaukee and almost certainly hastened the exodus of the middle class from Milwaukee. You might condemn what followed as "racist" white flight but the eventual rejection of busing for racial balance by minority parents should call such a simplistic view into question. Because. among other things, the burden of busing fell more heavily on African Americans (at least, in part, to prevent white families from leaving the system), support dwindled among blacks as well.
In any event, the effort to racially balance Milwaukee schools quickly ran into a dearth of white students. In 1984, MPS realized that it would be unable to avoid predominantly minority schools unless it could move students across city lines. Thus it initiated litigation to create a metropolitan-wide busing plan. I was a member of the team defending 24 suburban school districts who were named as defendants.
The case was weak and, if you want to believe me, we beat the pants off of the district in court. (One of my earliest victories as a trial lawyer was getting MPS' expert to admit, under oath, that he had told his research assistants not to collect data that "went the wrong way." While this may have been the product of luck more than skill, it has rarely gotten better than that.) In any event, MPS caved, settling for an agreement by the suburban districts to expand their participation in the existing chapter 220 voluntary transfer program as long as they had space and as long as the state would pay them for doing so. (The unacknowledged fact was that many of these suburban districts saw transfers from the city as a source of revenue.)
In the end, the 220 program did not materially change the composition of city or suburban schools because there wasn't much demand for it. (Although, ironically, my son spent a semester as a 220 student at the Milwaukee High School for the Arts.) The idea that racial balance was an important element of improving educational outcomes had lost favor. In the meantime, MPS lost white students to the point that it has become almost impossible not to have what the article calls "intensely segregated" schools. This is not a new development. It was predicted as long as 30 years ago.
The thing that did not bring this about is school choice. It didn't exist in 1984 and is not a vehicle for white "flight." Choice students are overwhelmingly minority. The movement of white students out of MPS is largely due to the failure of the city to remain attractive to middle class parents or of MPS to remain a viable alternative for middle class families who remain in the city. There are many wonderful neighborhoods in Milwaukee in which relatively few of the kids go to public school.
This reflects a theme in Milwaukee politics. Urban "champions" in this city have too often thought that the answer to the city's problems is to get someone else to foot the bill or to coerce others to participate in their preferred solutions. It is to fight expressways that allow people to move freely between the city and the suburbs. It is to trap municipal workers within the city through residency requirements. It was once the desire to impose metropolitan busing on students and is now hostility to the ability of low income families to choose their children's schools. It is to "expand" the state base so that the city retains local control but avoids local responsibility.
While I agree that a fair amount of the angst about crime in Milwaukee is overblown, the fact remains that there are parts of the city - including some very attractive neighborhoods - in which the crime rate is just too high to attract middle class families and create communities that are as strong as they might otherwise be. Milwaukee will never attract and maintain families as long as MPS is viewed as a wasteland. Telling people that they are "wrong" or "racist" to be concerned about crime or poor schools is a fool's errand.
Making people offers they "can't refuse" or dressing up coercion as "regionalism" hasn't worked and never will. Milwaukee will not be a successful city unless people choose to work and attend school in the city. There may be an example of a city that accomplished that through high taxes, the politics of racial spoils and hostility toward business, but I am not aware of it.
Cross posted at Purple Wisconsin.
Sunday's Journal Sentinel was themed around "resegregation" on the 60th anniversary of Brown v. Board of Education a story. The most interesting of several articles on the subject was a treatment of the increased lack of racial balance in MPS and the idea that this is sometime of "boomerang" effect of recent or sinister provenance.
In fact, the recognition that MPS would be unable to keep counting noses by their color was raised thirty years ago. As a rookie lawyer. I became involved in the "second generation" school desegregation litigation. It followed a rather contrived and result oriended decision by Judge John Reynolds holding that there had been intentional racial segregation by MPS that justified racial balancing in the city's schools.
Reynolds meant well - he was a creature of his age - but that decision destroyed, at least for awhile, the neighborhood school in Milwaukee and almost certainly hastened the exodus of the middle class from Milwaukee. You might condemn what followed as "racist" white flight but the eventual rejection of busing for racial balance by minority parents should call such a simplistic view into question. Because. among other things, the burden of busing fell more heavily on African Americans (at least, in part, to prevent white families from leaving the system), support dwindled among blacks as well.
In any event, the effort to racially balance Milwaukee schools quickly ran into a dearth of white students. In 1984, MPS realized that it would be unable to avoid predominantly minority schools unless it could move students across city lines. Thus it initiated litigation to create a metropolitan-wide busing plan. I was a member of the team defending 24 suburban school districts who were named as defendants.
The case was weak and, if you want to believe me, we beat the pants off of the district in court. (One of my earliest victories as a trial lawyer was getting MPS' expert to admit, under oath, that he had told his research assistants not to collect data that "went the wrong way." While this may have been the product of luck more than skill, it has rarely gotten better than that.) In any event, MPS caved, settling for an agreement by the suburban districts to expand their participation in the existing chapter 220 voluntary transfer program as long as they had space and as long as the state would pay them for doing so. (The unacknowledged fact was that many of these suburban districts saw transfers from the city as a source of revenue.)
In the end, the 220 program did not materially change the composition of city or suburban schools because there wasn't much demand for it. (Although, ironically, my son spent a semester as a 220 student at the Milwaukee High School for the Arts.) The idea that racial balance was an important element of improving educational outcomes had lost favor. In the meantime, MPS lost white students to the point that it has become almost impossible not to have what the article calls "intensely segregated" schools. This is not a new development. It was predicted as long as 30 years ago.
The thing that did not bring this about is school choice. It didn't exist in 1984 and is not a vehicle for white "flight." Choice students are overwhelmingly minority. The movement of white students out of MPS is largely due to the failure of the city to remain attractive to middle class parents or of MPS to remain a viable alternative for middle class families who remain in the city. There are many wonderful neighborhoods in Milwaukee in which relatively few of the kids go to public school.
This reflects a theme in Milwaukee politics. Urban "champions" in this city have too often thought that the answer to the city's problems is to get someone else to foot the bill or to coerce others to participate in their preferred solutions. It is to fight expressways that allow people to move freely between the city and the suburbs. It is to trap municipal workers within the city through residency requirements. It was once the desire to impose metropolitan busing on students and is now hostility to the ability of low income families to choose their children's schools. It is to "expand" the state base so that the city retains local control but avoids local responsibility.
While I agree that a fair amount of the angst about crime in Milwaukee is overblown, the fact remains that there are parts of the city - including some very attractive neighborhoods - in which the crime rate is just too high to attract middle class families and create communities that are as strong as they might otherwise be. Milwaukee will never attract and maintain families as long as MPS is viewed as a wasteland. Telling people that they are "wrong" or "racist" to be concerned about crime or poor schools is a fool's errand.
Making people offers they "can't refuse" or dressing up coercion as "regionalism" hasn't worked and never will. Milwaukee will not be a successful city unless people choose to work and attend school in the city. There may be an example of a city that accomplished that through high taxes, the politics of racial spoils and hostility toward business, but I am not aware of it.
Cross posted at Purple Wisconsin.
Monday, May 12, 2014
Sterling and affirmative action
James Causey writes that Donald Sterling's comments "prove" the need for affirmative action. In fact, if the Sterling episode proves anything about affirmative action, it is precisely the opposite.
One rationale for affirmative action is that it is supposed to compensate for difficult to detect discrimination. The idea is that racial discrimination is so pervasive yet so subtle that one needs not only to ban it legally, but engage in compensatory "counter-balancing discrimination.
Let's put aside the tension between simultaneously believing that something is so reviled as to have become hidden away so completely that it rarely be directly observed, yet so widespread and pervasive that we can safely assume it is always at work
Let's forget, for a moment, the old adage that two wrongs do not make a right. Let's put aside the possibility that excusing "benign" discrimination invariably leads to resentment and, in fact, encourages "hostile" discrimination by leveling the moral high ground that was once held by proponents of civil rights.
Let's ignore the increasingly persuasive evidence that affirmative action does not help its beneficiaries.
Let's just focus on what the Sterling story tells us. Sterling appears to be a straight-up racist. How did he run the Clippers?
Here's how. He hires black players. He hired a black general manager. He employs a black coach.
Does this mean he's not really racist? Not at all. It does mean he's a capitalist. Let me explain.
At the beginning of this month, Nobel Laureate Gary Becker, an economist at the University of Chicago, died. One of Becker's great accomplishments was to demonstrate how competitive markets may be the most effective anti-discrimination tool available. If participants in the market - say a basketball team - indulge a taste for discrimination and refuse to hire the most talented employees or to sell to willing customers on the basis of race, the market will make them pay. That is because there will be someone - think Branch Rickey - who does not share their bias (or chooses not to indulge it) and will be able to hire better talent and tap into profitable markets that the racist firm will abjure. Ultimately, racist firms must choose between their taste for prejudice and survival.
So Sterling came to understand that, if he wanted to win, he needed African American players. He needed the best coach he could get, so he hired former Marquette great Doc Rivers. He didn't have to become a better person to understand that he could not indulge his prejudices. He only needed to value his survival.
Now, of course, this won't always work. One can imagine circumstances in which the absence of prejudice will carry its own cost. For example, when racial hostility really is pervasive (think of Alabama in 1960), then hiring the best, say, plumbers won't help when a large of customers don't want African Americans in their homes. But the irony is that, in such situations, anti-discrimination laws (much less affirmative action) are unlikely to be passed or enforced.
The other argument for affirmative action is that it promotes understanding. Maybe if Donald Sterling had to go to school with African Americans, he wouldn't feel this way today. Perhaps.
But Sterling's problem is not that he has not been exposed to African Americans. He's owned an NBA team for over 30 years. He had a black mistress. He just seems to be inextricably bound to his own attitudes.
In any event, if the increasingly strong evidence for "mismatch" effects of affirmative action is correct, then it is just as likely that affirmative action will reinforce stereotypes. It is tempting to think that a committee of elites can fine tune the world. It is almost always wrong.
Cross posted at Purple Wisconsin.
One rationale for affirmative action is that it is supposed to compensate for difficult to detect discrimination. The idea is that racial discrimination is so pervasive yet so subtle that one needs not only to ban it legally, but engage in compensatory "counter-balancing discrimination.
Let's put aside the tension between simultaneously believing that something is so reviled as to have become hidden away so completely that it rarely be directly observed, yet so widespread and pervasive that we can safely assume it is always at work
Let's forget, for a moment, the old adage that two wrongs do not make a right. Let's put aside the possibility that excusing "benign" discrimination invariably leads to resentment and, in fact, encourages "hostile" discrimination by leveling the moral high ground that was once held by proponents of civil rights.
Let's ignore the increasingly persuasive evidence that affirmative action does not help its beneficiaries.
Let's just focus on what the Sterling story tells us. Sterling appears to be a straight-up racist. How did he run the Clippers?
Here's how. He hires black players. He hired a black general manager. He employs a black coach.
Does this mean he's not really racist? Not at all. It does mean he's a capitalist. Let me explain.
At the beginning of this month, Nobel Laureate Gary Becker, an economist at the University of Chicago, died. One of Becker's great accomplishments was to demonstrate how competitive markets may be the most effective anti-discrimination tool available. If participants in the market - say a basketball team - indulge a taste for discrimination and refuse to hire the most talented employees or to sell to willing customers on the basis of race, the market will make them pay. That is because there will be someone - think Branch Rickey - who does not share their bias (or chooses not to indulge it) and will be able to hire better talent and tap into profitable markets that the racist firm will abjure. Ultimately, racist firms must choose between their taste for prejudice and survival.
So Sterling came to understand that, if he wanted to win, he needed African American players. He needed the best coach he could get, so he hired former Marquette great Doc Rivers. He didn't have to become a better person to understand that he could not indulge his prejudices. He only needed to value his survival.
Now, of course, this won't always work. One can imagine circumstances in which the absence of prejudice will carry its own cost. For example, when racial hostility really is pervasive (think of Alabama in 1960), then hiring the best, say, plumbers won't help when a large of customers don't want African Americans in their homes. But the irony is that, in such situations, anti-discrimination laws (much less affirmative action) are unlikely to be passed or enforced.
The other argument for affirmative action is that it promotes understanding. Maybe if Donald Sterling had to go to school with African Americans, he wouldn't feel this way today. Perhaps.
But Sterling's problem is not that he has not been exposed to African Americans. He's owned an NBA team for over 30 years. He had a black mistress. He just seems to be inextricably bound to his own attitudes.
In any event, if the increasingly strong evidence for "mismatch" effects of affirmative action is correct, then it is just as likely that affirmative action will reinforce stereotypes. It is tempting to think that a committee of elites can fine tune the world. It is almost always wrong.
Cross posted at Purple Wisconsin.
Monday, May 05, 2014
Judicial recusal again
So we are now supposed to be interested in judicial recusal again. The idea is that, if interested parties - even independent organizations - spend a lot of money in a judicial election, then a justice who benefited from that spending ought to step aside.
Back when I worked as a full time legal academic and did such things, I wrote about judicial recusal. While the Journal Sentinel has turned to academic experts on the subject (generally representing a spectrum of opinion from A to A flat), the analysis that they offer is, in this context, insufficiently developed.
I wrote on the subject recently here. Let me revise and extend my remarks.
The idea between recusal based on campaign support is that it might cause a judge to improperly prefer the interests of a party. A judge in that sense might depart from the need to be impartial toward all parties; to apply the law - as she sees it - to all parties equally.
This was the reasoning behind the United States Supreme court's decision in Caperton v. A.T. Massey Coal Co. In that case, the CEO of Massey spent millions of dollars in support of a candidate for the West Virginia Supreme Court. At the time, Massey was in the process of appealing a $ 50 million verdict against it. When the beneficiary of this campaign support was elected and refused to recuse himself in the appeal, the U.S. Supreme Court found that the Caperton plaintiffs (who had won the large verdict) were denied their due process rights.
Now, there are problems with Caperton, but, even if we accept its reasoning, there are serious difficulties when one attempts to apply it to instances when campaign support has come from an ideological advocacy group such as Wisconsin Club for Growth or the Greater Wisconsin Committee. (In Caperton, an organization was used to spend most of the campaign money, but it was largely funded by Massey's CEO.)
These organizations really have no independent existence other than as an association of like-minded persons who want to speak in an election. Their are driven by ideological and policy preferences and their identity shifts from election to election. The organization is a vehicle for their association, but, as an institution, adds little to it. They might unite under the banner of the Club for Growth today and form a new organization tomorrow.
Significantly, these groups tend to support candidates who already share the perspective that their donors support. The Greater Wisconsin Committee looks for liberal candidates. It does not support candidates who do not share their outlook in the hope that he or she will "come around" after the election. Advocacy groups don't seek to influence candidates, as much as they seek to influence the electorate to support candidates who already have the views that the group seeks to advance.
So to be "biased" in favor of Club for Growth or the Greater Wisconsin Committee is to be biased in favor of the ideology they promote. It is, moreover, likely a "bias" that the candidate already has. It constitutes his or her deeply held convictions about the way in which the world works.
That's not impermissible bias. It does not raise due process concerns. In a case called White v. Republican Party, a majority of the United States Supreme Court held that bias in favor of a philosophical perspective - to have a position on disputed legal and political issues - is not bias at all.
Now, to be sure, there are times when a judge needs to put aside those preferences because the law requires that they be ignored. For example, I oppose the death penalty, but, by the traditional tools of legal analysis, I can't say it is unconstitutional. I might think that a state income tax is poor public policy, but, were I a judge, I'd certainly have to enforce it. (It is not, however, always the case that a judge's political or philosophical perspective will have no role in deciding a case; judges routinely rely on their philosophical and political beliefs to resolve uncertain questions of law. That's why we care so much about who is on the Supreme Court.)
But the fact that one has been supported by like-minded individuals does not make it appreciably less likely that a judge will be able to set aside biases that do not arise from that support, but from his or her own ideology.
Now, to be sure, a few caveats in order. Advocacy groups may be more ideological than candidates and drive them to more extreme positions than they otherwise would take. They may dissuade a judge from expressing a sincerely felt position that is more "nuanced" or idiosyncratic than his or her ideological cohorts would prefer. But it's not clear to me that monetary support makes this significantly more problematic than does the bare fact of judicial elections.
Of course, some donors support ideological groups for private purposes and, while their donors may not be disclosed, a judicial candidate will come to know who they are. But sorting that out - should a judge who accepts support from the plaintiffs' bar recuse herself in cases raising important questions of tort law - would seem to rest uneasily with the notion that we want the public, with all its conflicting interests, to elect judges.
Some people reject the premise of White v. Republican Party. They want judges to be selected without ideology. This is so, even though I am aware of no serious student of the law who does not believe that ideology matters in deciding certain cases in which the law is unclear. But this is really an argument against judicial elections more than it is an argument against recusal.
Here's why. Judicial elections - particularly for law developing courts like our state supreme court - will almost always involve contests of competing ideologies. If the support of one "side" or the other is a basis for recusal, there is always be basis for recusal in cases with political or ideological import.
In fact, the problem runs even deeper than is commonly supposed. The most recent Journal Sentinel article draws a distinction between campaigns in which a great deal of money has been spent and those in which it has not - generally because the latter races were not competitive.
On one level, that makes sense. But, if we are really worried about the impact of ideology and the groups that advance ideologies in judicial elections, it stops short of efficacy - at least in the context of a multi-member court. Even if a justice is not running, he or she may care deeply about the campaigns involving other members of the Court. Those races can affect whether a justice will have a like-minded majority in the ideologically driven cases about which the justices may care the most.
It is well known within the legal community that members of the state supreme court recruit or support (generally silently) candidates to oppose their colleagues. (In fact, a recent proposal by the state bar association to limit justices to one sixteen year term is, in part, driven by the potentially corrosive impact of justices being involved in their colleagues' re-election campaigns.) It is also the case that a justice who is contemplating re-election will be aware that certain groups will spend for or against them when the time comes. Thus, if we think ideological support is a problem, combating it will require more than simply seeking the recusal of justices who have had contested races in which these advocacy groups have been players.
It is no answer to this problem to say that limiting recusal to candidates who have enjoyed the support or weathered the opposition of these groups is better than nothing. Stopping halfway can affect the ideological composition of the court and frustrate the political choices that the public, in electing these judges, has made.
So my view has been that an aggressive view of recusal - requiring it in the wake of lawful campaign support particularly from advocacy groups - is at odds with our decision to elect judges and, quite frankly, is a vehicle for mischief - of attempts to change the composition of a court that the public has elected - than it is a way to ensure impartiality.
Cross posted at Purple Wisconsin.
Back when I worked as a full time legal academic and did such things, I wrote about judicial recusal. While the Journal Sentinel has turned to academic experts on the subject (generally representing a spectrum of opinion from A to A flat), the analysis that they offer is, in this context, insufficiently developed.
I wrote on the subject recently here. Let me revise and extend my remarks.
The idea between recusal based on campaign support is that it might cause a judge to improperly prefer the interests of a party. A judge in that sense might depart from the need to be impartial toward all parties; to apply the law - as she sees it - to all parties equally.
This was the reasoning behind the United States Supreme court's decision in Caperton v. A.T. Massey Coal Co. In that case, the CEO of Massey spent millions of dollars in support of a candidate for the West Virginia Supreme Court. At the time, Massey was in the process of appealing a $ 50 million verdict against it. When the beneficiary of this campaign support was elected and refused to recuse himself in the appeal, the U.S. Supreme Court found that the Caperton plaintiffs (who had won the large verdict) were denied their due process rights.
Now, there are problems with Caperton, but, even if we accept its reasoning, there are serious difficulties when one attempts to apply it to instances when campaign support has come from an ideological advocacy group such as Wisconsin Club for Growth or the Greater Wisconsin Committee. (In Caperton, an organization was used to spend most of the campaign money, but it was largely funded by Massey's CEO.)
These organizations really have no independent existence other than as an association of like-minded persons who want to speak in an election. Their are driven by ideological and policy preferences and their identity shifts from election to election. The organization is a vehicle for their association, but, as an institution, adds little to it. They might unite under the banner of the Club for Growth today and form a new organization tomorrow.
Significantly, these groups tend to support candidates who already share the perspective that their donors support. The Greater Wisconsin Committee looks for liberal candidates. It does not support candidates who do not share their outlook in the hope that he or she will "come around" after the election. Advocacy groups don't seek to influence candidates, as much as they seek to influence the electorate to support candidates who already have the views that the group seeks to advance.
So to be "biased" in favor of Club for Growth or the Greater Wisconsin Committee is to be biased in favor of the ideology they promote. It is, moreover, likely a "bias" that the candidate already has. It constitutes his or her deeply held convictions about the way in which the world works.
That's not impermissible bias. It does not raise due process concerns. In a case called White v. Republican Party, a majority of the United States Supreme Court held that bias in favor of a philosophical perspective - to have a position on disputed legal and political issues - is not bias at all.
Now, to be sure, there are times when a judge needs to put aside those preferences because the law requires that they be ignored. For example, I oppose the death penalty, but, by the traditional tools of legal analysis, I can't say it is unconstitutional. I might think that a state income tax is poor public policy, but, were I a judge, I'd certainly have to enforce it. (It is not, however, always the case that a judge's political or philosophical perspective will have no role in deciding a case; judges routinely rely on their philosophical and political beliefs to resolve uncertain questions of law. That's why we care so much about who is on the Supreme Court.)
But the fact that one has been supported by like-minded individuals does not make it appreciably less likely that a judge will be able to set aside biases that do not arise from that support, but from his or her own ideology.
Now, to be sure, a few caveats in order. Advocacy groups may be more ideological than candidates and drive them to more extreme positions than they otherwise would take. They may dissuade a judge from expressing a sincerely felt position that is more "nuanced" or idiosyncratic than his or her ideological cohorts would prefer. But it's not clear to me that monetary support makes this significantly more problematic than does the bare fact of judicial elections.
Of course, some donors support ideological groups for private purposes and, while their donors may not be disclosed, a judicial candidate will come to know who they are. But sorting that out - should a judge who accepts support from the plaintiffs' bar recuse herself in cases raising important questions of tort law - would seem to rest uneasily with the notion that we want the public, with all its conflicting interests, to elect judges.
Some people reject the premise of White v. Republican Party. They want judges to be selected without ideology. This is so, even though I am aware of no serious student of the law who does not believe that ideology matters in deciding certain cases in which the law is unclear. But this is really an argument against judicial elections more than it is an argument against recusal.
Here's why. Judicial elections - particularly for law developing courts like our state supreme court - will almost always involve contests of competing ideologies. If the support of one "side" or the other is a basis for recusal, there is always be basis for recusal in cases with political or ideological import.
In fact, the problem runs even deeper than is commonly supposed. The most recent Journal Sentinel article draws a distinction between campaigns in which a great deal of money has been spent and those in which it has not - generally because the latter races were not competitive.
On one level, that makes sense. But, if we are really worried about the impact of ideology and the groups that advance ideologies in judicial elections, it stops short of efficacy - at least in the context of a multi-member court. Even if a justice is not running, he or she may care deeply about the campaigns involving other members of the Court. Those races can affect whether a justice will have a like-minded majority in the ideologically driven cases about which the justices may care the most.
It is well known within the legal community that members of the state supreme court recruit or support (generally silently) candidates to oppose their colleagues. (In fact, a recent proposal by the state bar association to limit justices to one sixteen year term is, in part, driven by the potentially corrosive impact of justices being involved in their colleagues' re-election campaigns.) It is also the case that a justice who is contemplating re-election will be aware that certain groups will spend for or against them when the time comes. Thus, if we think ideological support is a problem, combating it will require more than simply seeking the recusal of justices who have had contested races in which these advocacy groups have been players.
It is no answer to this problem to say that limiting recusal to candidates who have enjoyed the support or weathered the opposition of these groups is better than nothing. Stopping halfway can affect the ideological composition of the court and frustrate the political choices that the public, in electing these judges, has made.
So my view has been that an aggressive view of recusal - requiring it in the wake of lawful campaign support particularly from advocacy groups - is at odds with our decision to elect judges and, quite frankly, is a vehicle for mischief - of attempts to change the composition of a court that the public has elected - than it is a way to ensure impartiality.
Cross posted at Purple Wisconsin.
Friday, May 02, 2014
Of city and suburbs
Milwaukee's city-suburban wars have been going on for longer than I can remember. The one constant has been a failure of each side to understand the legitimate concerns of the other and to dismiss either the "'burbs" or the "city" with unwarranted caricatures.
A case in point: the recent contretemps between my Purple Wisconsin colleague Alex Runner and Waukesha blogger Nate Sass. Both seem to be decent enough blokes but something about this particular fault line seems to generate more heat than light.
Sass goes first, suggesting that a new arena ought to be built in Waukesha or at least not downtown. These, it seems to me, are at least tenable suggestions; certainly nothing that should earn the author contempt. If you want regional funding for a new building, you need to take into account regional perspectives. Putting aside whether there ought to be public funding, I tend to think that downtown or Menomonee Valley are the best locations. But if you want to ask the suburbs for money, you ought not dismiss the suggestion that the playground be built in the suburbs as beyond the pale.
Sass points out that the BMO Harris Center did not lead to the economic development that was once hoped for. This too strikes me as a legitimate point. The sluggish performance of the Bradley Center neighborhood does not mean that a new arena in that area can't do better, but it would be foolish not to ask why things didn't turn out better.
In my mind, Sass goes off the rails in suggesting that downtown Milwaukee is a wasteland that no one wants to visit. That is demonstrably false. Crime is not a problem in downtown Milwaukee and parking is quite manageable. If he doesn't think so, he should leave Waukesha and head down there this summer.
I agree that Milwaukee is not Manhattan or Chicago. Only a handful of cities in the world are. I also agree that it is not Madison. It makes Madison look like Fargo.
In response to this, Alex loses his last nerve, calling Sass' piece a "hack job." But Sass makes a couple of points that urban advocates should not lose sight of.
The first is that the suburbs are no longer dependent on - and do not live off - the city. To be sure, Brookfield and Mequon came to be because Milwaukee was there first. But so were Grosse Pointe and Southfield a product of Detroit. That they don't need Detroit anymore is evident from a drive the length of Woodward Avenue.
This is more true today than ever. Three years ago, when I founded the Wisconsin Institute for Law & Liberty, I put it in downtown Milwaukee for no reason other than my subjective preference to be there. There was absolutely no business reason to do so.
The implication of that point is that the city is not in a position to demand that the suburbs pay for whatever it wants however it wants it. One cannot build a great city by expecting outsiders to fund things that John Lindsay thought were good ideas in 1966. Milwaukee will not rise on the power of government. If you want prosperity, you need to earn it. It won't come by politics.
I appreciate that many people believe this is unfair. It is no less true for that.
The second is that, when public money from the outside is properly spent, it must come with political participation. Sass is correct to point out that the MMSD is a prime example of a "regional" approach that one side has attempted to dominate at the expense of the other. That's one reason it hasn't worked very well.
It is risible for Milwaukee to say that is just wants to be "left alone." That's the last thing it wants. Being left alone - to truly exercise "local control" - would mean ceasing to be a supplicant. The city would have to announce that it no longer wants to receive tax dollars generated outside its borders.
Indeed, conservative that I am, I don't believe that Milwaukee should be "left alone" in this way, although I believe that many of the preferred nostrums of Milwaukee politicians are ill conceived and counterproductive. I am not anti-urban. I am anti-urban "progressivism."
But Milwaukee can't expect to be inveterately hostile to the interests of the larger region - yes, I'm talking freeways, streetcars and taxes - and not expect to reap hostility in turn.
Cross posted at Purple Wisconsin.
A case in point: the recent contretemps between my Purple Wisconsin colleague Alex Runner and Waukesha blogger Nate Sass. Both seem to be decent enough blokes but something about this particular fault line seems to generate more heat than light.
Sass goes first, suggesting that a new arena ought to be built in Waukesha or at least not downtown. These, it seems to me, are at least tenable suggestions; certainly nothing that should earn the author contempt. If you want regional funding for a new building, you need to take into account regional perspectives. Putting aside whether there ought to be public funding, I tend to think that downtown or Menomonee Valley are the best locations. But if you want to ask the suburbs for money, you ought not dismiss the suggestion that the playground be built in the suburbs as beyond the pale.
Sass points out that the BMO Harris Center did not lead to the economic development that was once hoped for. This too strikes me as a legitimate point. The sluggish performance of the Bradley Center neighborhood does not mean that a new arena in that area can't do better, but it would be foolish not to ask why things didn't turn out better.
In my mind, Sass goes off the rails in suggesting that downtown Milwaukee is a wasteland that no one wants to visit. That is demonstrably false. Crime is not a problem in downtown Milwaukee and parking is quite manageable. If he doesn't think so, he should leave Waukesha and head down there this summer.
I agree that Milwaukee is not Manhattan or Chicago. Only a handful of cities in the world are. I also agree that it is not Madison. It makes Madison look like Fargo.
In response to this, Alex loses his last nerve, calling Sass' piece a "hack job." But Sass makes a couple of points that urban advocates should not lose sight of.
The first is that the suburbs are no longer dependent on - and do not live off - the city. To be sure, Brookfield and Mequon came to be because Milwaukee was there first. But so were Grosse Pointe and Southfield a product of Detroit. That they don't need Detroit anymore is evident from a drive the length of Woodward Avenue.
This is more true today than ever. Three years ago, when I founded the Wisconsin Institute for Law & Liberty, I put it in downtown Milwaukee for no reason other than my subjective preference to be there. There was absolutely no business reason to do so.
The implication of that point is that the city is not in a position to demand that the suburbs pay for whatever it wants however it wants it. One cannot build a great city by expecting outsiders to fund things that John Lindsay thought were good ideas in 1966. Milwaukee will not rise on the power of government. If you want prosperity, you need to earn it. It won't come by politics.
I appreciate that many people believe this is unfair. It is no less true for that.
The second is that, when public money from the outside is properly spent, it must come with political participation. Sass is correct to point out that the MMSD is a prime example of a "regional" approach that one side has attempted to dominate at the expense of the other. That's one reason it hasn't worked very well.
It is risible for Milwaukee to say that is just wants to be "left alone." That's the last thing it wants. Being left alone - to truly exercise "local control" - would mean ceasing to be a supplicant. The city would have to announce that it no longer wants to receive tax dollars generated outside its borders.
Indeed, conservative that I am, I don't believe that Milwaukee should be "left alone" in this way, although I believe that many of the preferred nostrums of Milwaukee politicians are ill conceived and counterproductive. I am not anti-urban. I am anti-urban "progressivism."
But Milwaukee can't expect to be inveterately hostile to the interests of the larger region - yes, I'm talking freeways, streetcars and taxes - and not expect to reap hostility in turn.
Cross posted at Purple Wisconsin.
Thursday, May 01, 2014
Nullification on the left and right
I wrote an earlier post about secession. Now I should address nullification.
It's not constitutional. The United States Constitution makes clear that federal law has supremacy over conflicting state law. Resolutions calling for acts of nullification are, at best, wastes of time and, at worst, bad politics. They give fodder to your enemies.
But I do think that three observations are in order.
First, I don't mind that Dan Bice keeps writing about this, but I would think - if he is looking for crackpots to box around - that he might point out to his readers that Shorewood and a number of other communities around the state recently voted to repeal the First Amendment rights of the newspaper works for - as well as every other newspaper and broadcast station in the country.
Second, while we ought to respect the Supremacy Clause in our constitution, we should also respect constitutional limitations on the power of the federal government. Over the past eighty years, those limitation, with the acquiescence of the Supreme Court, have been largely ignored through a combination of lawyerly sophistry and indifference. Legal sophisticates try to avoid a debate about this by presenting this a a fait accompli - something that it makes no sense to question and is, in any event, an inevitable outcome of the centralizing tendencies of the twentieth century. That's not so and a resolution addressing that would be appropriate.
Third, I sure hope that we are going to see as much emphasis on the crackpottery of the Democratic Party resolutions committee. It is not clear to me, for example, that support for nullification or secession in "extreme" circumstances is any worse than support for abortion until, literally, the moment of delivery or, as noted above, repealing the First Amendment rights of newspapers and other legal associations of persons.
It's not constitutional. The United States Constitution makes clear that federal law has supremacy over conflicting state law. Resolutions calling for acts of nullification are, at best, wastes of time and, at worst, bad politics. They give fodder to your enemies.
But I do think that three observations are in order.
First, I don't mind that Dan Bice keeps writing about this, but I would think - if he is looking for crackpots to box around - that he might point out to his readers that Shorewood and a number of other communities around the state recently voted to repeal the First Amendment rights of the newspaper works for - as well as every other newspaper and broadcast station in the country.
Second, while we ought to respect the Supremacy Clause in our constitution, we should also respect constitutional limitations on the power of the federal government. Over the past eighty years, those limitation, with the acquiescence of the Supreme Court, have been largely ignored through a combination of lawyerly sophistry and indifference. Legal sophisticates try to avoid a debate about this by presenting this a a fait accompli - something that it makes no sense to question and is, in any event, an inevitable outcome of the centralizing tendencies of the twentieth century. That's not so and a resolution addressing that would be appropriate.
Third, I sure hope that we are going to see as much emphasis on the crackpottery of the Democratic Party resolutions committee. It is not clear to me, for example, that support for nullification or secession in "extreme" circumstances is any worse than support for abortion until, literally, the moment of delivery or, as noted above, repealing the First Amendment rights of newspapers and other legal associations of persons.
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