July 22, 2016 10:15AM

Economics Will Be Our Ruination II

Economics appears to be a neutral tool, but it often subtly embeds values that we are better off surfacing and discussing. In a recent post henceforth to be known as "Economics Will Be Our Runiation I," I pointed out how, by preferring to measure the movement of dollars, orthodox economics treats leisure as a bad thing and laments advances in technology-based entertainments.

This installment of EWBOR focuses on an interesting and insightful article recently published in the University of Pennsylvania Law Review, "An Economic Understanding of Search and Seizure Law." In it, George Washington University Law School professor Orin Kerr shows that the Fourth Amendment helps increase the efficiency of law enforcement by accounting for external costs of investigations. Here is his model:

The net benefit of any particular investigative step can be described as P*V – Ci – Ce, where P represents the increase in probability that the crime will be solved and successfully prosecuted, V represents the net value of a successful prosecution resulting from deterrence and incapacitation, Ci represents the internal costs of the investigative step, and Ce represents its external costs.

Ci means things like the cost of training and equipping police officers and paying their salaries, as well as their own use of their time. Ce, external costs, "include privacy harms and property losses that result from an investigation that is imposed on a suspect. They also include the loss of autonomy and freedom imposed directly on the subject of the investigation (who may be guilty or innocent) as well as his family or associates." Kerr rightly includes in Ce more diffuse burdens such as community hostility to law enforcement.

The model helps reveal interesting things. "In conducting Fourth Amendment balancing," Kerr notes, "courts often compare absolute costs to marginal benefits or marginal costs to absolute benefits." An example is In re Terrorist Bombings of U.S. Embassies in East Africa, 552 F.3d 157 (2008). In that case, the Second Circuit Court of Appeals found surveillance of a particular target reasonable because of "the self-evident need to investigate threats to national security presented by foreign terrorist organizations." The court should have compared the costs of this particular instance of surveillence to the potential benefits of this particular instance of surveillance.

Kerr illustrates the merits of his model with a hypothetical in which a stolen necklace is in one of ten houses. Thirty utility units are on offer to this small society if the necklace can be found and the thief locked away. It costs five "utils" to forcibly search each house, far fewer to get consent or a warrant. The model shows that the Fourth Amendment curtails law enforcement's inclination to impose excessive costs on the public. The public interest is served by the Fourth Amendment's welfare-enhancing rules.

But here's what's hidden in this otherwise interesting and helpful thought experiment: Kerr has developed an economic model of the the Fourth Amendment as a group right. An incautious reader might be lead to believe that enhancement of the general welfare is the sine qua non of the Fourth Amendment.

You only have to tweak the numbers in Kerr's example to see how it can be used to undercut the Fourth Amendment. Change the stolen necklace to a terrorist and up the "utils" in finding him to fifty-five. For the public good, the police can now break into and search each and every house.

The Fourth Amendment is not a group right. The sine qua non of the Fourth Amendment is "a man's home is his castle," with similar treatment given to his or her person, papers, and effects. The Fourth Amendment gives people an individual right against unreasonable searches and seizures, public welfare be damned. Searches and seizures must be reasonable as to that person in that particular instance, not on the whole. The Fourth Amendment allows individuals to impose inefficiency in law enforcement on society as a whole in service to the greater good of letting each individual live in a free society. There's probably a way to model that, but I don't know what it is.

A good defense to my criticism is that Professor Kerr's model is intended for strictly rational assessment of V (the value of apprehension, etc.). You wouldn't get a benefit from catching a terrorist that is greater than the cost of searching all homes. But that begs the question that the Fourth Amendment is there to answer. It's a counter-majoritarian protection because our society and government can be expected to calculate the benefits of searching and seizing us and our things wrongly.

In the name of liberty, beware the embedded values in economics and economic models! They might not be yours!