Archives: 06/2006

The Exclusionary Rule

Yesterday’s ruling in Hudson v. Michigan could prove to be a landmark Supreme Court precedent. We already knew that it was an important case involving the “knock-and-announce” principle, but, as New York Times reporter Linda Greenhouse observes today, the majority opinion is so “dismissive of the exclusionary rule as to serve as an invitation to bring a direct challenge to the rule in a future case.” 

I’m afraid that may well be right. If so, it means we are moving from an important battle, which we just lost, over the knock-and-announce doctrine, to a battle royal over the Fourth Amendment generally.

For background on the exclusionary rule, go here.

Have You No Respect for the Law (of Demand)?!

The law of demand is a bitter pill for defenders of labor market price controls. Noted economic theorist Matt Yglesias has grown weary of appeals to “Economics 101” in the minimum wage debate. “After all,” Yglesias writes, “there’s a reason they offer more economics classes and you don’t get your degree after taking just one.” His American Prospect colleague Ezra Klein says of the law of demand that “It’s a good guideline, but it’s got no end of exceptions.” The minimum wage, of course, is one those exceptions.

They’re both right in general, if not about the minimum wage in particular. There are more economics classes, and they do teach exceptions. However, let’s not imagine that there is some advanced economic class in which you learn that the law of demand is false. (Well, no doubt there is somewhere. There is contradiction-friendly “paraconsistent logic,” after all.)

To use Yglesias’s misapplied example, Econ 101 principles do not stand to higher-level economics in the way that Newtonian physics stands to relativity and quantum machanics: as a useful, but literally false, simplification of reality. Economic laws are not strict laws of nature, codifying ineluctable relationships of necessity, and they do not pretend to be. So counterexamples are not ipso facto falsifying, and the law of demand is never replaced with a better, more empirically adequate, law. The law of demand is very, very empirically adequate as it is: It captures a ubiquitous regularity of human behavior that is abundantly comfirmed every moment of every day, and without which there would be no science of economics.

But it is just a regularity, like people flinching involuntarily when they hear a sudden, loud sound. It doesn’t have to happen, but it’s pretty surprising when it doesn’t. (“Is he deaf? Paralyzed?”) And when it doesn’t, there’s need for some special explanation.

Economic laws, like the principles of all the “special sciences,” are ceteris paribus generalizations: generalizations that are true other things being equal. Econ 101 lays out the basic laws and explains what follows from them ceteris paribus. Later, students learn about cases when other things are not equal – when there are exceptions to the generalization. So, it is always possible to argue that the law of demand does not apply in this or that kind of circumstance. A certain necessary auxiliary condition, which is almost always present, may be absent in a certain kind of case, causing the regularity to break down. But then, in order to predict an exception to the regular pattern, you need to cite the absence of the relevant auxiliary condition (e.g., “He can’t hear; that’s why he didn’t flinch”). I hope Yglesias is not also tired of Philosophy of Science 101.

Now, let’s note two things. First, you will be utterly hopeless in reliably identifying exceptions to a ceteris paribus law when you never grasped its logic in the first place. Exhortations to mind your Econ 101 generally aren’t exhortations to stop being so darn advanced. They are exhortations to actually comprehend the principles upon which advancement depends. And, second, the fact that a law is ceteris paribus does not mean you can deny its applicability whenever you want to. Political convenience tends not to be an appropriate auxiliary condition. You can’t wave your hands and just hope that a good argument is in some upper-level textbook you haven’t read.

If you want to say that a wage floor is not going to throw some low-wage workers out of their jobs (or prevent them from getting jobs), you’ve got to say, in a principled way, why not. The burden is on those who predict an exception to an immensely reliable regularity. The most popular principled explanation for the failure of minimum wage increases to create unemployment is a story about monopsony conditions for low-wage labor, i.e., imperfectly competitive labor market conditions in which there is a single buyer of low-wage labor (or a colluding band of buyers), that is able to set wages that workers have little choice but to accept. A simple model (Econ 101, even!) shows that under such conditions, an increase in the minimum wage, within a certain range, could even increase employment and raise efficiency.

Card and Krueger’s famed statistical work on minimum wage, which wage-increase advocates wave around as if it were proof of the Resurrection, tells a kind of very complex monopsony story. They recognize, unlike many of the people who abuse their findings, that their statistical results on minimum wage hikes, in isolation from further theory, can at best establish that other things were not equal at a certain place and time (e.g., fast food restaurants in Pennsylvania and New Jersy in the mid-1990s). This provides no basis for predicting the effects of future minimum wage increases unless it is accompanied by a principled theory of what general features of the situation were not equal.

Their theory, in a nutshell, is: “Turnover costs, imperfect information, search frictions, commuting costs, and inertia generate short-run, and possibly long-run, monopsony power for individual firms.” This is not exactly a simple condition, likely to apply uniformly across a huge, diverse country. That an increased minimum wage might not cause unemployment in some places where certain conditions apply does not provide a strong argument for raising it everywhere. And the monopsony story, as far as I understand it, establishes only that there is a range up to which the wage floor could be raised without creating a disemployment effect. In order to use Card and Krueger to support an increase to $7, you would need to provide evidence that the federal minimum is not already at the top of that range, and that $7 will not exceed it. Maybe somebody has done this, but I haven’t seen it.

Card and Krueger’s empirical work would constitute some evidence in favor of their monopsony hypothesis. But how well does the evidence support the theory? For a taste just from the Cato archives, try Douglas K. Adie and Lowell Gallaway’s review of C&K’s book Myth and Measurement in the Cato Journal, or “Sense and Nonsense on the Minimum Wage ” by Donald Deere, Kevin Murphy, and Finis Welch, in Regulation Magazine. Yglesias cites a petition of economists in favor of raising the minimum wage. Probably more informative is this serious 2002 NBER research summary by UC Irvine economist David Neumark, in which he reports that “although there may be some outlying perspectives, economists’ views of the effects of the minimum wage are centered in the range of the earlier [than Card & Krueger] estimates, and many of the more-recent estimates, of the [significantly positive] disemployment effects of minimum wages.” That is, C & K’s position is an “outlying perspective.”

But consensus tennis is a very silly game. Better is Neumark’s analysis of the state of play (in 2002) regarding the C & K studies:

More recent studies have used panel data covering multiple states over time, exploiting differences across states in minimum wages. This approach permits researchers to abstract from aggregate economic changes that may coincide with changes in the national minimum wage and hence make difficult untangling the effects of minimum wages in aggregate time-series data.

Evidence from these “second generation” studies has spurred considerable controversy regarding whether or not minimum wages reduce employment of low-skilled workers, with some researchers arguing that the predictions of the standard model are wrong, and that minimum wages do not reduce and may even increase employment. The most prominent and often-cited such study uses data collected from a telephone survey of managers or assistant managers in fast-food restaurants in New Jersey and Pennsylvania before and after a minimum wage increase in New Jersey.

Not only do these data fail to indicate a relative employment decline in New Jersey, but rather they show that employment rose sharply there (with positive employment elasticities in the range of 0.7).

On the other hand, much recent evidence using similar sorts of data tends to confirm the prediction that minimum wages reduce employment of low-skilled workers; so does earlier work with a much longer panel of states. Moreover, an approach to estimating the employment effects of minimum wages that focuses more explicitly on whether minimum wages are high relative to an equilibrium wage for affected workers reveals two things: first, disemployment effects appear when minimum wages are more likely to be binding (because the equilibrium wage absent the minimum is low); second, some of the small or zero estimated disemployment effects in other studies appear to be from regions or periods in which minimum wages were much less likely to have been binding. Finally, a re-examination of the New Jersey-Pennsylvania study that I conducted, based on payroll records collected from fast-food establishments, finds that the original telephone survey data were plagued by severe measurement error, and that the payroll data generally point to negative employment elasticities.

That is to say, C & K’s findings have been challenged.

Meanwhile, studies continue to appear emphasizing the hazards of minimum wage laws. I find Neumark’s recent paper with Olena Nizalova especially unsettling. They find evidence that minimum wage laws discourage teenagers and young adults from acquiring the human capital they need in order to get better jobs and higher wages later in life. That is, minimum wage laws work to ensure that those who already have the fewest opportunities to develop their capacities, have even fewer still. They say this baleful effect is strongest for young blacks.

Progressives find grand, symbolic political importance in the minimum wage. But isn’t their most important concern the welfare and prospects of the poor?

Payday on Capitol Hill

This week, House lawmakers “approved” a $3,300 increase to their current $165,200 salaries. Most appalling about this increase is not its fiscal impact, which is very small relative to the federal budget. Rather, it is the despicably clandestine process by which it is routinely passed.

Because of a 1989 law that makes congressional pay raises automatic, Congress very rarely actually votes to increase lawmakers’ pay. They can voluntarily block the raise and did so five times in the ’90s. But since 1999, they have accepted the automatic increase every year and used procedural tactics to table any discussion or vote on the matter.

In March, the Senate tried to go one step further, approving a measure that would deny pay raises to any individual senator or congressmember who votes against a pay increase. The measure would have also denied pay raises to members who opposed the procedural vote to block consideration of the pay raise.

Sound complicated? Well it is. Congress has quite intentionally shrouded the entire process to keep the public from paying attention. And they can hardly be blamed. Given their track record of late, does anyone actually believe these guys deserve more money?

WWTD?

There’s a liberal/neo-con tiff brewing over the legacy of Harry Truman. Peter Beinart gets sniffy about George W. Bush “tak[ing] Truman’s name in vain.” (Who’s Harry in that metaphor?)  Max Boot says HST, like GWB, was wonderfully unilateral: “The decision to nuke Hiroshima and Nagasaki? A unilateral U.S. initiative. The Marshall Plan to aid European recovery? Ditto.” Matt Yglesias thinks Truman was “great,” but “What Would Truman Do?” isn’t really a useful question. 

All three focus on Truman’s legacy abroad. But when you look at behavior on the home front, it seems to me that George W. Bush has as good a claim to Truman’s legacy as anyone. Domestically, HST was as unilateral as all get-out. Look at the Steel Seizure case. Facing down a nationwide steel strike in the midst of the Korean war, Truman ordered his secretary of commerce to seize the steel companies and operate them for the government. He did so using a constitutional theory that’s by now familiar. Here’s assistant attorney general Holmes Baldridge laying it out before federal district court judge David A. Pine in 1952:

Judge Pine: So you contend the Executive has unlimited power in time of an emergency?
Baldridge: He has the power to take such action as is necessary to meet the emergency.
Judge Pine: If the emergency is great, it is unlimited, is it?
Baldridge: I suppose if you carry it to its logical conclusion, that is true….
Judge Pine: And that the Executive determines the emergencies and the courts cannot even review whether it is an emergency.
Baldridge: That is correct.

Later, Pine asked Baldridge: “So, when the sovereign people adopted the Constitution, it enumerated the powers set up in the Constitution, but limited the powers of the Congress and limited the powers of the judiciary, but it did not limit the powers of the Executive. Is that what you say?” Baldridge replied, “That is the way we read Article II of the Constitution.” 

Luckily, neither Judge Pine nor the Supremes bought it.

Then there’s that minor undeclared “police action” on the Korean peninsula. Wonderfully unilateral there as well, as far as Congress goes. 

If, like Boot, you think the country suffers from insufficient concentration of power in the executive branch, then Truman’s legacy is something to fight over. But if you don’t, then “WWTD?” isn’t the right question by a long shot.

America & Soccer

The “Lexington” column in this week’s Economist features a now-standard riff about how curious and revealing it is that America eschews the world’s pastime. The twist: The world resents the hell out of us for this. 

But would “the world” really be happier if America took this game seriously and, as a consequence, cut through their footballers like a hot knife through butter? I doubt it. The only way to make “the world” happy would be if we cared a lot about soccer and lost a lot at soccer. Anything else would simply feed the insatiable anti-America hate machine. 

Topics:

Scalia’s Alternate Universe

The following, from Justice Scalia’s opinion in Hudson, is an absolute joke:

Another development over the past half-century that deters civil-rights violations is the increasing professionalism of police forces, including a new emphasis on internal police discipline. Even as long ago as 1989, we felt it proper to “assume” that unlawful police behavior “would be dealt with appropriately” by the authorities, but we now have increasing evidence that police forces across the United States take the constitutional rights of citizens seriously. There have been “wide ranging reforms in the education, training, and supervision” of police officers (cite omitted).

[…]

Moreover, modern police forces are staffed with professionals; it is not credible to assert that internal discipline, which can limit successful careers, will not have a deterrent effect. There is also evidence that the increasing use of various forms of citizen review can enhance police accountability.

Scalia couldn’t be more off-base. In the book After Prohibition, edited by my Cato colleague Tim Lynch, Yale University’s Steven Duke offers an entire chapter on the way the drug war has eviscerated constitutional protections. David Kopel adds another chapter on the way it has inspired a frightening culture of militarism among our domestic police departments. Jim Bovard, in his book Lost Rights, also documents the way the “drug war exception” to the Bill of Rights has inspired police excesses. And Eastern Kentucky University’s Peter Kraska has extensively documented the way military culture has created a battlefield mindset among today’s police forces that puts winning the “war” well ahead of protecting constitutional rights. Joel Miller also documents numerous examples of the drug war’s corrupting influence on police officers in his book Bad Trip.

If Scalia wants to consult an ex-cop, he might try recently retired Seattle Police Chief Norm Stamper, who talks about the same issues in his recent book Breaking Rank. Or he might speak with the ex-law enforcement officials who’ve turned on the drug war and formed LEAP — Law Enforcement Against Prohibition.

Police are certainly more highly trained than they once were, but they aren’t better trained at observing civil liberties. They’re better trained at paramilitary tactics. They’re now trained by former Navy SEALs and Army Rangers. They’re better trained at treating civilians like enemy combatants, at taking over and “clearing” rooms in private homes, not at treating the people inside as citizens with rights.

Scalia’s synopsis is shockingly naive. He ought to look up Hearne. Or Tulia. He might look into the Dallas informant scandal, or the Miami SWAT-Internal affairs scandal, or LAPD’s multiple police scandals, including a civilian review board scandal, or the fact that New York City’s civilian review board, for example, has no jurisdiction whatsoever over — guess what? — no-knock raids. Here’s another example. Here is yet another. He might listen to this horrifying audio. These are just a few examples. They are by no means isolated incidents.

Internal affairs investigations are notoriously inept. Even in cases in which police officers were found to have committed egregious offenses, those cases were uncovered during federal investigations or during civil trials, or by journalists, or by mere happenstance — not by “internal police discipline.”

Is Scalia oblivious to “the blue wall of silence?” “Internal discipline,” as he calls it, certainly does “limit successful careers,” but not in the way Scalia portrays it. You are “disciplined” to keep quiet when it comes to abuse, excessive force, and corruption. It’s the officers who talk who eventually find their careers “severely limited.” How many examples do we need before they stop being considered anomalies?

In my research on this issue, I’ve never — not once — seen a police officer convicted of even a misdemeanor for shooting an innocent civilian in a botched raid. Very few are even subject to internal discipline. (Consider the recent case of Sal Culosi.) And it’s happened (“it” being the death of innocent as the resut of a botched raid) about three dozen times. As Justice Breyer notes in his dissent, even the state of Michigan in its brief couldn’t cite a single time a police officer has successfully been sued for conducting an illegal no-knock raid. On my personal website, I’ve kept a running list of SWAT-like raids gone bad. It’s a depressingly long list.

In sum, police aren’t better trained at respecting civil liberties, they’re better trained at finding ways to get around them. The ratcheting up of the drug war in the early 1980s has made police abuse of civil liberties routine. And let’s be clear: It is bad policy that has created this mess. Bad policy from politicians, regulators, and judges who continue to cling to the belief that if we give police just a few more drug-fighting tools, we’ll lick this “drug war” thing for good — despite an overwhelming amount of evidence to the contrary.

Scalia’s pronouncement that we’ve entered a new era of police respect for civil rights is so far off-base it’s laughable.

I can stomach a decision that doesn’t go my way. But it ought to be grounded in reality.