#1 and #2 run together. If spam is the problem, you don’t need to block access to the Web site. However, if you are concerned that students are going to read the petition, [...]]]> In the spirit of the excellent colloquy here about Marvin’s thinking on First Amendment architectures, I bring up this news item: Arizona State University blocked both Web access to, and e-mail from, the change.org Web site. ASU students had begun a petition demanding that the university reduce tuition. The university essentially made three claims as to why it did so (below, in order of increasing stupidity):

1. It was a technical mistake;
2. Change.org was spamming ASU; and
3. ASU needs to “protect the use of our limited and valuable network resources for legitimate academic, research and administrative uses.”

#1 and #2 run together. If spam is the problem, you don’t need to block access to the Web site. However, if you are concerned that students are going to read the petition, and sign it, you do need to block access to the Web site.

For #2, sorry, ASU, this isn’t spam. Spam is unsolicited bulk commercial e-mail. Change.org is, allegedly, sending unsolicited political e-mail. And that’s protected by the First Amendment – see, for example, the Virginia Supreme Court’s analysis of that state’s anti-spam law that covered political messages. Potential political spammers have a sharp disincentive to fill recipient’s inboxes – it’s a sure-fire way to annoy them into opposing your position.

For #3, ASU doesn’t get to determine what academic and research uses are “legitimate.” If they throttle P2P apps, that’s fine. If they limit file sizes for attachments, no problem. But deciding that the message from Change.org is not “legitimate” is classic, and unconstitutional, viewpoint discrimination.

This looks like censorship. I think it’s more likely to be stupidity: someone in ASU’s IT department decided to block these messages as spam, and to filter outbound Web requests to the site contained within those messages. But: with great power over the network comes great responsibility. Well-intentioned constitutional violations are still unlawful. It would also help if ASU’s spokesperson simply admitted the mistake rather than engaging in idiotic justification.

As I mention in Orwell’s Armchair, public actors are increasingly important sources of Internet access. But when ASU and other public universities take on the role of ISP, they need to remember that they are not AOL: their technical decisions are constrained not merely by tech resources, but by our commitment to free speech. Let’s hope the Sun Devils cool off on the filtering…

Cross-posted at Info/Law.

I recognize that at this point the governmental speech architecture is not very well-developed.  But its foundation is coming into clearer focus.  In some spaces, including the workplace and a small public park in Pleasant Grove City, Utah, the Supreme Court has exempted certain government decisions from free speech scrutiny on the ground that the spaces do not function as forums for public speech, but rather as government speech spaces.  As I have argued elsewhere, at least on a conceptual level the Pleasant Grove decision comes [...]]]> In terms of free speech architecture, I think the developing “government speech” principle poses some important questions.  Under this principle, some spaces are principally reserved for government speech rather than public discourse.  Are government speech spaces exceptions to the doctrine Marvin otherwise views optimistically, a separate aspect of speech architecture, not part of speech architecture at all, or simply products of a flawed doctrine or principle? 

I recognize that at this point the governmental speech architecture is not very well-developed.  But its foundation is coming into clearer focus.  In some spaces, including the workplace and a small public park in Pleasant Grove City, Utah, the Supreme Court has exempted certain government decisions from free speech scrutiny on the ground that the spaces do not function as forums for public speech, but rather as government speech spaces.  As I have argued elsewhere, at least on a conceptual level the Pleasant Grove decision comes close to turning a traditional public forum into a governmental forum.  Given its uncertain parameters, a host of other spaces might be affected by the government speech principle.  These might include some virtual spaces, such as government websites, that might otherwise serve as forums for public discussion.  Under the developing government speech principle, the more involved the government is in terms of funding, managing, and controlling speech activity in a particular space, the more plausible its argument that access may be denied — even on the basis of content.  

Perhaps this is just a small wrinkle with regard to speech architecture.  Or perhaps the government speech principle will create some significant cracks or holes in the archictecure.  Either way, I wonder what, if anything, Marvin thinks this doctrine says about the government’s relationsip to speech spaces.

The traditional public forum doctrine, of course, promotes universality. Streets and parks are open to all, and they provide small, unpopular, or poorly financed speakers with an opportunity for a forum. These speakers often won’t have access to other speech spaces, like broadcast channels or newspapers. [...]]]> So far I have discussed four principles concerning speech spaces (and Brett has added one). This is the fifth principle concerning speech spaces that I set out in my recent article. The First Amendment encourages access for all Americans to physical and digital speech spaces, even if the “unregulated” speech market would not provide access to many speakers. Those that benefit most from government efforts to expand universal access to speech spaces are speakers in rural areas or those without extensive means.

The traditional public forum doctrine, of course, promotes universality. Streets and parks are open to all, and they provide small, unpopular, or poorly financed speakers with an opportunity for a forum. These speakers often won’t have access to other speech spaces, like broadcast channels or newspapers. But government’s work towards achieving universal speech spaces has not been limited to public forums.
In early American history, the vast postal network allowed universal access for newspapers and other forms of communication. The U.S. had more postal roads per capita than any other nation. Nowadays, the government has adopted policies for a wide array of media to ensure universality of basic speech spaces. In the area of telephone service, carriers are legally required to subsidize low-income, rural, and non-commercial speakers, and they may do so by charging higher rates to other customers. Similarly, when the FCC hands out licenses to cell phone companies, its chief stated goal is to make cell phone service available nationwide.

With television, broadcast companies must serve all segments of a society, even less profitable ones like children (through mandated educational programs) and the disabled (through closed captioning). Cable companies are required to carry broadcast stations so that all Americans can access free, over-the-air television. And most localities require cable companies to serve the entire community.

Perhaps most critically, the federal government has taken steps to promote universal access to the most vital speech space of the 21st century, the Internet. The FCC, at Congress’s behest, is now devising a plan to promote the expansion of Internet service to all Americans.

Some of these universality regulations have been challenged on First Amendment grounds, with companies arguing that the mandatory build-out of cable or phone systems to specified customers forced the companies to “speak” to those with whom it would rather not converse. This is a “compelled speech” argument. But courts have generally rejected such arguments, usually at the district court level, suggesting that the greater goal of universality takes precedence over any arguable infringement of the speech rights of a small number of speakers.

Indeed, the recent National Broadband Plan proposed by the FCC is focused on ensuring the availability of access to high-speed Internet for all Americans (at least in principle). Ensuring access to such important speech spaces is important to guaranteeing all Americans can participate in our democracy and our culture today. This principle is suggested in the Supreme Court’s oft-quoted maxim that the First Amendment’s basic tenet is that the “widest dissemination” of information, from diverse sources, is necessary for public welfare. Government policy, and some judicial doctrine, further this goal of ensuring the widest dissemination of information.

Greg’s piece accuses me of being overly optimistic, and for misinterpreting First Amendment precedent and doing so for (misguided) strategic reasons. He assures us that First Amendment precedent is awful and getting worse. He says I should just admit as much, and that I should argue merely that the precedent “ought” to be better, not that it “is” any good at all. And his examples of the awfulness of doctrine include Citizens United (which I disagree with, but don’t dwell on [...]]]> Timothy Zick and Greg Magarian make some great points in their recent posts. For those unfamiliar with Zick or Magarian, they are two of the most important and insightful thinkers writing about the First Amendment today, evidenced even in these brief posts. I’m going to respond to Greg’s first.

Greg’s piece accuses me of being overly optimistic, and for misinterpreting First Amendment precedent and doing so for (misguided) strategic reasons. He assures us that First Amendment precedent is awful and getting worse. He says I should just admit as much, and that I should argue merely that the precedent “ought” to be better, not that it “is” any good at all. And his examples of the awfulness of doctrine include Citizens United (which I disagree with, but don’t dwell on as it is not so clearly “spatial,” the focus of the paper) and also points to the public forum cases.

We agree in part actually, but disagree in part. Here is where I disagree: I am more likely to celebrate what the doctrine is but not out of misguided strategy but because he thinks doctrine ought to be something different from what I think it ought to be.

A few years go, Greg and I had a discussion over dinner. At that dinner, he said that the courts should impose media access rules directly, based on the First Amendment alone, whether or not a law would create that access rule. I said that generally such access rules should be permissible, but not judicially required. My argument was based partly on institutional competence: judges are not really expert in media policy. Judges and clerks are not at the top of my list for people who should devise spectrum policy or  draft the communications regulations. And I think the public should indeed be more involved in making such decisions of designing our speech systems–and other institutions are designed to be more responsive to the public. Greg thinks courts ought to impose access rules and other rules; I think, subject to some limits, courts ought to defer to a range of permissible decisions by legislatures and agencies about such rules. This is why Greg takes me to task for celebrating the shopping mall case: I am less troubled that the courts did not directly impose access for speech but merely permitted governments to enact laws requiring access.

This is why Greg says, “But when the Supreme Court faced the question whether the First Amendment required shopping centers to tolerate expressive activity, the Court said no.  So yes, First Amendment law sometimes steps out of the way of voluntary government efforts to advance speech interests over other interests.” To me, that is important. Courts and lawyers often argue (or assume) that the First Amendment flat out forbids government from opening new spaces for speech–particularly digital spaces.  That the First Amendment does not forbid such action says something about the First Amendment–just as it not requiring access to shopping malls says something about the Amendment. And, in my opinion (and in that of some others), this permissiveness contradicts the notion that government must not pursue substantive speech-based goals, such as opening speech spaces, when they interfere with the speech market. For Greg, such permissiveness “doesn’t contradict or even complicate the negative liberty paradigm,” but I see it differently.

Finally, we do agree on a few things. The doctrine as it is could be better. I don’t think it’s perfect and it is certainly not getting better, but there are important strains in the doctrine, particularly regarding government discretion to promote diversity of sources, universal access, national and local speech, and simply additional speech spaces. There are far too many cases in our First Amendment tradition that uphold censorship. Far too many cases enable government to silence speech based on content-neutral reasons (something Tim has argued forcefully in his work on public spaces). And I am almost ashamed to engage in any comparative institutional analysis–weighing whether the Supreme Court is a better decision-making institution than the Congress is like asking whether the institution that brought us Bush v. Gore, Citizens United, and Holder v. Humanitarian Project should be trusted more than the institution, Congress, with a 9% approval rating that brought us the debt ceiling fiasco, nonstop gridlock, that recently rushed to pass a censorial copyright bill before being derailed (and had passed immunity for warrantless wiretapping and provided the president with the power to hold US citizens indefinitely without a trial).  Still, for reasons mentioned above, regarding the permissibility of opening speech spaces for speech, I am willing to be more optimistic than my friend Greg, though he does provide some excellent reasons for pessimism.

In an earlier post, I noted some of the benefits of Marvin’s [...]]]> With regard to traditional public forum spaces, the Supreme Court has imposed certain duties on governments as “trustees.”  These duties include a responsibility to ensure access to public parks, streets, and (most) sidewalks, and adherence to a principle of anti-discrimination (although it may not include a duty to preserve any forum spaces in perpetuity, or require diversity of speech or speakers).  The trusteeship principle is problematic in the sense that it continues what I (and others) believe to be the categorical error of treating forum doctrine as a matter of property principles, rather than deeper spatial concerns.  However, the principle does provide a basis for imposing some obligation on government to open, maintain, and perhaps preserve certain spaces.

In an earlier post, I noted some of the benefits of Marvin’s broad conception of spatial architecture.  Here I raise a potential complication.  With regard to public forum spaces, the trustee concept arises principally from the fact of governmental ownership and the need for minimal access for exercise of fundamental rights of speech, assembly, and petition.  Trusteeship is rooted in the special nature of these places, in particular their historical connection to First Amendment liberties.  I wonder what normative or other basis exists for treating other speech spaces in a similar manner.  In other words, on what basis can government be said to have an obligation (whether judicially enforceable or not) of some sort to open and diversify not only traditional public forum spaces but  new spaces, virtual spaces, private spaces, and regulated (but not publicly owned) spaces?  I undertand from Marvin’s account that the doctrine can be interpreted to support this result, and that legislators can be “constitutional norm entrepreneurs.”  But to impose or argue for diversity, sufficiency, and other requirements across a broad range of channels and spaces, don’t we need a trusteeship principle, or something like it, for the entire architecture?  Can one be found in, or fashioned from, doctrine or other sources?

I recognize that this might seem to tread too close to the negative liberty / anti-censorship model, but in my view, it helps connect the anti-censorship model with the pro-architecture model.  We should worry when government micro-manages speech and chooses winners and losers, but macro-managing/structuring the speech environment is unavoidable.  A nondiscrimination principle guides the latter (macro-management) to avoid the [...]]]> There is one principle that I would add to the five that Marvin examines in the article:  nondiscrimination.  It seems to me that across public and private, physical and virtual ”space” contexts (and judicial opinions), one persistent principle is that nondiscriminatory approaches to sustaining spaces, platforms, … infrastructures are presumptively legit and normatively attractive — whether government efforts to “sustain” involve public provisioning, subsidization or regulation.

I recognize that this might seem to tread too close to the negative liberty / anti-censorship model, but in my view, it helps connect the anti-censorship model with the pro-architecture model.  We should worry when government micro-manages speech and chooses winners and losers, but macro-managing/structuring the speech environment is unavoidable.  A nondiscrimination principle guides the latter (macro-management) to avoid the former (micro-management).

This sixth principle is implicit is the other five that Marvin discusses.  It’s not articulated as a stand-alone principle, uniform across situations, or even defined completely.  Nonetheless, nondiscrimination of *some* sort is part of the spatial analysis for each principle. For example, in the paper, when Marvin discusses designated public spaces, he says that government can designate spaces–so long as it does so in a nondiscriminatory way. The nondiscrimination principle here is limited: government cannot discriminate based on the limited notion of “content.”  Another example is limited public forums where government cannot discriminate on viewpoint, but can set aside a forum for particular speakers based on the expected content (say students / educational content).  There are other examples that Marvin explores in the paper.  In my view, there is something fundamental about nondiscrimnation and the functional role that it plays that warrants further attention.

Frankly, the idea of a nondiscrimination principle connects with my own ideas about the First Amendment being aimed at sustaining infrastructure commons and the many different types of spillovers from speech–or more broadly, sustaining a spillover-rich cultural environment;  I explored those ideas in an essay and I expand on them in the book.   It is important to make clear that government support for infrastructure commons — whether by direct provisioning or by common carrier style regulation — lessens pressure on both governments and markets to pick winners and losers in the speech marketplace/environment, and as Marvin argues, that is something that is and ought to be fundamental or core in any FA model.

In my own work on speech and spatiality, I have focused on the importance to freedom of speech, assembly, and petition of access to public parks and plazas (public forums).  Marvin’s conception of speech spaces is much broader.  [...]]]> I too want to thank Danielle and Concurring Opinions for hosting this discussion.  I think Marvin has addressed a really timely and important topic, speech spaces and architecture, in his forthcoming article.  As readers can tell from his posts here and elsewhere, and from reading the piece, Marvin challenges a fair amount of what passes for conventional wisdom in the free speech area.  I look forward to discussing his thesis and some of its implications.  In this post, I want to address why the framing of the issues Marvin addresses as distinctly spatial ones is critically important.  

In my own work on speech and spatiality, I have focused on the importance to freedom of speech, assembly, and petition of access to public parks and plazas (public forums).  Marvin’s conception of speech spaces is much broader.  It includes not only these traditional forums, but various channels of communication.  Thus, he provides an expansive conception of free speech spaces, one that extends far beyond my own conception of the “expressive topography.”   Under Marvin’s conception, newspapers, broadcast and cable stations, the U.S. mail, and the Internet are all speech spaces.  Thay are part of our expressive architecture.  By treating these channels as spaces or places rather than simply mediums of expression, Marvin begins to push against traditional conceptual boundaries.  By framing the discussion in terms of spataility, he begins the process of rearranging conceptual, theoretical, and doctrinal boundaries.   

The central payoffs from this conceptual framing are two-fold. 

First, Marvin is able to provide a comprehensive conceptual framework, one which captures a broad range of spaces — physical, virtual, public, private, local, national, and global.  Although he offers a spatial framework, Marvin avoids the critical mistake of the public forum doctrine.  The analysis does not turn on how we characterize or categorize these spaces — they are all important to speech rights, and they all implicate common principles relating to government facilitation and regulation of expression.  As the Occupy protests and various consumer petition drives have recently shown, now more than ever spatial pluralism is crucial to the full enjoyment of expressive rights. 

Second, and nearer the core of Marvin’s contribution, adopting a spatial frame leads us to the foundation of certain First Amendment docrtines and principles.  Space is antecedent and primary.  As breathing requires air, speech requires space.  As Marvin observes, our free speech doctrines and principles recognize this fact — mostly in implicit terms. Some of these doctrines and principles are facilitative and positive in character, rather than merely or solely negative.  The doctrinal implications of this spatial frame will need to be  worked out.  However, Marvin seems to be addressing primarily legislative and administrative officials.  As Jack Balkin and others have noted, these officials will have asubstantial influence on speech architecture in both the near and more distant future.

In the article, the critical approach that Marvin takes to challenge the “standard” model of the First Amendment is really interesting. He claims that the standard model of the First Amendment focuses on preserving speakers’ freedom by restricting government action and leaves any affirmative obligations for government to sustain open public spaces to a patchwork of exceptions lacking any coherent theory or principles. A significant consequence of this model is that open public spaces for speech—I want to substitute “infrastructure” for “spaces”–are marginalized and taken for granted. My forthcoming book—Infrastructure: The Social Value of Shared Resources–explains why such marginalization occurs in [...]]]> Thank you to Marvin for an excellent article to read and discuss, and thank you Concurring Opinions for providing a public forum for our discussion.

In the article, the critical approach that Marvin takes to challenge the “standard” model of the First Amendment is really interesting. He claims that the standard model of the First Amendment focuses on preserving speakers’ freedom by restricting government action and leaves any affirmative obligations for government to sustain open public spaces to a patchwork of exceptions lacking any coherent theory or principles. A significant consequence of this model is that open public spaces for speech—I want to substitute “infrastructure” for “spaces”–are marginalized and taken for granted. My forthcoming book—Infrastructure: The Social Value of Shared Resources–explains why such marginalization occurs in this and various other contexts and develops a theory to support the exceptions. But I’ll leave those thoughts aside for now and perhaps explore them in another post. And I’ll leave it to the First Amendment scholars to debate Marvin’s claim about what is the standard model for the First Amendment.

Instead, I would like to point out how a similar (maybe the same) problem can be seen in the Supreme Court’s most recent copyright opinion. In Golan v. Holder , Justice Ginsburg marginalizes the public domain in a startlingly fashion. Since it is a copyright case, the “model” is flipped around: government is empowered to grant exclusive rights (and restrict some speakers’ freedom) and any restrictions on the government’s power to do so is limited to narrow exceptions, i.e., the idea-expression distinction and fair use. A central argument in the case was that the public domain itself is another restriction. The public domain is not expressly mentioned in the IP Clause of the Constitution, but arguably, it is implicit throughout (Progress in Science and the Useful Arts, Limited Times). Besides, the public domain is inescapably part of the reality that we stand on the shoulders of generations of giants. Most copyright scholars believed that Congress could not grant copyright to works in the public domain (and probably thought that the issue raised in the case – involving restoration for foreign works that had not been granted copyright protection in the U.S — presented an exceptional situation that might be dealt with as such). But the Court declined to rule narrowly and firmly rejected the argument that “the Constitution renders the public domain largely untouchable by Congress.” In the end, Congress appears to have incredibly broad latitude to exercise its power, limited only by the need to preserve the “traditional contours.”

Of course, it is much more troublesome that the Supreme Court (rather than scholars interpreting Supreme Court cases) has adopted a flawed conceptual model that marginalizes basic public infrastructure. We’re stuck with it.

Speaking of exciting developments, it appears that the Stop Online Piracy Act (SOPA) is dead, at least for now. House Majority Leader Eric Cantor has said that the bill will not move forward until there is a consensus position on it, which is to say, never. Media sources credit the Obama administration’s opposition to some of the more noxious parts of SOPA, such as its DNSSEC-killing filtering provisions, and also the tech community’s efforts to raise awareness. (Techdirt’s Mike Masnick has been working overtime in reporting on SOPA; Wikipedia and Reddit are adopting a blackout to draw attention; even the New York City techies are holding a demonstration in front of the offices of Senators [...]]]> Thanks to Danielle and the CoOp crew for having me! I’m excited.

Speaking of exciting developments, it appears that the Stop Online Piracy Act (SOPA) is dead, at least for now. House Majority Leader Eric Cantor has said that the bill will not move forward until there is a consensus position on it, which is to say, never. Media sources credit the Obama administration’s opposition to some of the more noxious parts of SOPA, such as its DNSSEC-killing filtering provisions, and also the tech community’s efforts to raise awareness. (Techdirt’s Mike Masnick has been working overtime in reporting on SOPA; Wikipedia and Reddit are adopting a blackout to draw attention; even the New York City techies are holding a demonstration in front of the offices of Senators Kirstin Gillibrand and Charles Schumer. Schumer has been bailing water on the SOPA front after one of his staffers told a local entrepreneur that the senator supports Internet censorship. Props for candor.) I think the Obama administration’s lack of enthusiasm for the bill is important, but I suspect that a crowded legislative calendar is also playing a significant role.

Of course, the PROTECT IP Act is still floating around the Senate. It’s less worse than SOPA, in the same way that Transformers 2 is less worse than Transformers 3. (You still might want to see what else Netflix has available.) And sponsor Senator Patrick Leahy has suggested that the DNS filtering provisions of the bill be studied – after the legislation is passed. It’s much more efficient, legislatively, to regulate first and then see if it will be effective. A more cynical view is that Senator Leahy’s move is a public relations tactic designed to undercut the opposition, but no one wants to say so to his face.

I am not opposed to Internet censorship in all situations, which means I am often lonely at tech-related events. But these bills have significant flaws. They threaten to badly weaken cybersecurity, an area that is purportedly a national priority (and has been for 15 years). They claim to address a major threat to IP rightsholders despite the complete lack of data that the threat is anything other than chimerical. They provide scant procedural protections for accused infringers, and confer extraordinary power on private rightsholders – power that will, inevitably, be abused. And they reflect a significant public choice imbalance in how IP and Internet policy is made in the United States.

Surprisingly, the Obama administration has it about right: we shouldn’t reject Internet censorship as a regulatory mechanism out of hand, but we should be wary of it. This isn’t the last stage of this debate – like Wesley in The Princess Bride, SOPA-like legislation is only mostly dead. (And, if you don’t like the Obama administration’s position today, just wait a day or two.)

Cross-posted at Info/Law.

Equally entertaining is Justice Nelson’s dissent, where he lambasts Citizens United while concluding that the case requires the invalidation of the Montana law. “In my view,” he says, “Citizens [...]]]> Western Tradition Partnership, Inc. v. Attorney General, which upheld Montana’s statute regulating corporate contributions to political campaigns, is a very amusing opinion.  It’s been a long time since a state supreme court has so brazenly tried to evade a U.S. Supreme Court decision–in this case Citizens United.  We learn, among other fascinating details, that Citizens United  was really a fact-bound case that need not be followed if a different record is presented to a court.  And we also learn that there is a Montana exception to the First Amendment, at least with respect to campaign finance regulation

Equally entertaining is Justice Nelson’s dissent, where he lambasts Citizens United while concluding that the case requires the invalidation of the Montana law. “In my view,” he says, “Citizens United has turned the First Amendment’s ‘open market-place’ of ideas into an auction house for Friedmanian corporatists.”  (I must admit that I didn’t know that Milton Friedman was a corporatist, an adjective, or interested in campaign finance.)  Justice Nelson also rejects the marketplace of ideas metaphor:

“[V]oters generally do not have the desire, much less the time, sophistication, or ability, to sift through hours upon hours of attack ads, political mumbo jumbo, and sound bites in order to winnow truth (of which there often seems to be very little) from fiction and half-truths (of which there unfortunately seems to be an endless supply).  The Supreme Court believes the solution for false or misleading speech is more speech. Yet, an endless barrage of accusations and counteraccusations providing more fodder than fact only serves to overwhelm, confuse, and disenchant voters.”

Finally, his dissent goes after the idea of corporate personhood:

“Corporations are artificial creatures of law. As such, they should enjoy only those powers—not constitutional rights, but legislatively-conferred powers—that are concomitant with their legitimate function, that being limited-liability investment vehicles for business. Corporations are not persons. Human beings are persons, and it is an affront to the inviolable dignity of our species that courts have created a legal fiction which forces people—human beings—to share fundamental, natural rights with soulless creations of government. Worse still, while corporations and human beings share many of the same rights under the law, they clearly are not bound equally to the same codes of good conduct, decency, and morality, and they are not held equally accountable for their sins. Indeed, it is truly ironic that the death penalty and hell are reserved only to natural persons.”

Now I agree with the last argument to this extent–it is perfectly clear that the Framers of the Fourteenth Amendment (Bingham especially) did not intend the word “person” in the Due Process Clause to include corporations. Originalists don’t seem to care about this. Nevertheless, the more important point, which I’ve made before, is that campaign finance regulation is a huge waste of time.  If half of the energy spent of that goal were spent on diminishing partisan gerrymandering of legislative districts, the improvement in the political process would be far greater.

In The Irony of Free Speech, Owen Fiss warned that the language of the First Amendment would lose its emancipatory potential as courts used it to gut progressive legislation. In a recent essay in Democracy Journal, Jedediah Purdy confirms those fears. His thoughts on last term’s Sorrell v. IMS Health are particularly incisive on the topic of commercial speech, which [...]]]> Recently a coalition of Missouri payday lenders implied “that standing up for high-interest-rate lenders is somehow analagous to the acts of the ‘poor people who followed Dr. King and walked with him hundreds of miles because they believed in civil rights that much.’” Because we all know that liberty means little if you’re not free to take a loan out at 444% APR.

In The Irony of Free Speech, Owen Fiss warned that the language of the First Amendment would lose its emancipatory potential as courts used it to gut progressive legislation. In a recent essay in Democracy Journal, Jedediah Purdy confirms those fears. His thoughts on last term’s Sorrell v. IMS Health are particularly incisive on the topic of commercial speech, which the Court appears ready to radically rethink:

[Even as t]he Court has tenuously maintained the formula that commercial speech receives lower protection than “core” political speech, it has struck down limits on advertising for legal services, liquor stores, and tobacco products (in the last instance, invalidating a law that forbade tobacco advertising near schools)….The justices have never said, though, that advertising deserves the same very strict protection as political debate. Sorrell v. IMS, the Vermont case, comes as close as any to dissolving all distinction between advertising and argument.

The stranger and more innovative aspect of Sorrell is that the case extended First Amendment protection beyond anything recognizable as speech. . . . [M]ost of what the Vermont decision protects is not verbal expression or even political spending but simply the sale of data. Sorrell moves toward constitutionalizing an open market in information, at least where the data will inform marketing decisions and the regulation has different effects on different market actors. As the right to speak implied the right to spend and the right to argue implied a right to advertise, now spending and advertising imply a right to buy and sell the information that will go into marketing (which is itself robustly protected as speech). So there is now a constitutionally protected interest in exchanging information on the same terms as everyone else in the market. Any limit on information markets, Kennedy reasoned, would tilt the playing field in favor of those who had more access to data—–in Vermont’s case, generic drug companies and public-health agencies. . . . . [The Court] put[s] new intellectual premises to work in constitutional law, premises that themselves form no part of the Constitution.

Ronald Dworkin’s 2007 jeremiad may have been premature, but recent terms have confirmed the neo-Lochnerism of the Court’s majority. It’s an institution that will barely lift a finger for brutalized protesters or citizens routinely humiliated and detained due to security theater. But if Sorrell is any guide, it will soon be scrutinizing consumer and investor protections embedded by law into “guidelines for . . . communications by energy and financial companies, restrictions on the uses pharmaceutical companies may recommend for their drugs, and various controls on disclosure of patient information by doctors and hospitals.” Who cares about pervasively racialized law enforcement? There are FDA regs to review.

In my last post, I noted the widening divide between courts’ and agencies’ respectful treatment of trade secrets, a form of corporate privacy, and their increasing disdain for personal privacy. In Sorrell, the Court used the First Amendment to accelerate the trend, claiming that free speech rights trumped any privacy rights that Vermont’s legislature tried to protect. Purdy explains the historical antecedents of today’s laissez-faire judicial juggernaut:

The First Amendment has helped the Supreme Court do for the consumer capitalism of the Information Age what freedom of contract did for the Industrial Age: constitutionally protect certain transactions that lie at the core of the economy. This makes unequal economic power much harder for democratic lawmaking to reach, because there are only a few ways to reduce the effects of economic inequality: redistribute wealth, guarantee certain goods (such as education or health care) regardless of wealth, and limit what the wealthy can do with their money. Constitutional protection of marketing and spending takes the last option off the table at a time when the other two are politically embattled. Whether in elections or in marketing and the vast data economy behind it, the market itself, with all its inequality, is ever more thoroughly constitutionalized as a realm of freedom.

My only problem with Purdy’s argument is the reification of “the market” in the last sentence here. In Sorrell, one of the main reasons there was data in the first place was that the state of Vermont required records to be kept of pharmaceutical transactions. Legislation like the Hatch-Waxman Act prescribes a regime of protections and obligations for drug manufacturers that is extraordinarily complex, and continually contested. The FDA is involved in every step of a drug’s approval, and significantly constrains its marketing. Medicare Part D legislation also significantly increased the U.S. government’s involvement in the pharmaceutical sector, providing an enormous
amount of funding for spending on drugs for the elderly. International treaties like TRIPS also play a very important role in the pharmaceutical sector.

In short, if there is one sector where state action is not simply a side constraint on “the market,” but rather serves to constitute it, that sector is the pharmaceutical industry. Judicial interventions like Sorrell can’t bring us closer to a “free market” that never existed in the first place. They just make a long-standing private-public partnership less responsive to the public interest.

Free Markets: Ideal or Illusion?

I only bring up this quibble with what is in the main a remarkably insightful article because there is a major divide between progressives on the nature of “free markets.” Dean Baker insists that there are genuine economic principles that govern “free markets,” and that progressives should embrace them. Barry Lynn’s efforts to revive antitrust law resonate with Baker’s views, as do most interventions from center-left think tanks in DC. Ideals of competitive markets also deeply informed the Affordable Care Act, as leading Democrats abandoned a public option in the hope that insurance exchanges could finally make competition work in health care.

Against this orthodoxy, James K. Galbraith has argued that Republicans long ago abandoned any pretense of supporting “free markets,” and liberals should now do the same. I’d also place in the Galbraith camp Bernard Harcourt (author of The Illusion of Free Markets) and Michael Lind (a big advocate of industrial policy). To steal a formulation of Stanley Fish, they believe that there’s no such thing as a free market, and it’s a good thing, too. The question for these thinkers is not shifting the boundary between state and market, but instead assuring that the inevitable combination of the two meets human needs as efficiently and well as possible.

In any event, I particularly liked this closing reflection from Purdy’s article:

Taken to their limit, [cases like Sorrell and Citizens United] would set aside the intellectual and political gains of decades of struggle in the twentieth century: the New Deal recognition that the country must take responsibility for shaping its own economy, and the decision to remove the old American romance with economic libertarianism from constitutional judging. It is the revival of that bad romance that makes the memory of Lochner relevant now.

There is another dimension to the “bad romance” here; the crony capitalist marriage of big business and big government that suffuses the exchanges blessed in Citizens United and Sorrell. This is not the jurisprudence of the “free market,” but rather of a corrupted hybrid economy devoted to little more than maximizing the wealth of CEOs and Wall Street grandees. The Bob Roberts Court may well be repeating Lochner-era mistakes, but the real conservatives are the people who expose its radicalism.

The Stanford Law Review Online has just published a piece by Mark Lemley, David S. Levine, and David G. Post on the PROTECT IP Act and the Stop Online Piracy Act. In Don’t Break the Internet, they argue that the two bills — intended to counter online copyright and trademark infringement — “share an underlying approach and an enforcement philosophy that pose grave constitutional problems and that could have potentially disastrous consequences for the stability and security of the Internet’s addressing system, for the principle of interconnectivity that has helped drive the Internet’s extraordinary growth, and for free expression.”

They write:

These bills, and the enforcement philosophy that underlies them, represent a dramatic retreat from this country’s tradition of leadership in supporting the free exchange of information [...]]]>

The Stanford Law Review Online has just published a piece by Mark Lemley, David S. Levine, and David G. Post on the PROTECT IP Act and the Stop Online Piracy Act. In Don’t Break the Internet, they argue that the two bills — intended to counter online copyright and trademark infringement — “share an underlying approach and an enforcement philosophy that pose grave constitutional problems and that could have potentially disastrous consequences for the stability and security of the Internet’s addressing system, for the principle of interconnectivity that has helped drive the Internet’s extraordinary growth, and for free expression.”

They write:

These bills, and the enforcement philosophy that underlies them, represent a dramatic retreat from this country’s tradition of leadership in supporting the free exchange of information and ideas on the Internet. At a time when many foreign governments have dramatically stepped up their efforts to censor Internet communications, these bills would incorporate into U.S. law a principle more closely associated with those repressive regimes: a right to insist on the removal of content from the global Internet, regardless of where it may have originated or be located, in service of the exigencies of domestic law.

Read the full article, Don’t Break the Internet by Mark Lemley, David S. Levine, and David G. Post, at the Stanford Law Review Online.

Note: Corrected typo in first paragraph.

An application of judicial power that does not rest on facts is worse than mindless, it is inherently dangerous . . . . In any case like this that touches on the transparency of financial markets whose gyrations have so depressed our economy and debilitated our lives, there is an overriding public interest in knowing the truth.

And Sheila Bair suggests that we are still in the dark about critical aspects of the financial system:

Credit exposure reports are essential to make sure regulators understand crucial inter-relationships between distress [...]]]> Finance crises have baffled recently. Jon Corzine says he has no idea where hundreds of millions of dollars in MF Global money went. Judge Rakoff says the proposed SEC-Citi settlement would whitewash the megabank’s wrongdoing:

An application of judicial power that does not rest on facts is worse than mindless, it is inherently dangerous . . . . In any case like this that touches on the transparency of financial markets whose gyrations have so depressed our economy and debilitated our lives, there is an overriding public interest in knowing the truth.

And Sheila Bair suggests that we are still in the dark about critical aspects of the financial system:

Credit exposure reports are essential to make sure regulators understand crucial inter-relationships between distress at one institution and its potential to cause major losses at other institutions. This type of information was missing during the crisis. I know that many members of [Congress] heard the same arguments that I heard during the crisis — that bailouts were necessary or the “entire system” would come down.

But we never really had good, detailed information about the derivatives counterparties, bondholders, and others who we were ultimately benefiting from the bailouts and why they needed protecting. For those concerned about the potential “domino” effect of a large bank failure, it is essential not only to identify, understand, and monitor these exposures but also to limit them in advance to contain any possible contagion. I would urge the FDIC and FRB to complete this final piece of the living will rule as soon as possible.

I could give dozens of other examples of frustration at black box finance. The critical issue now is to realize that the opacity is not simply a natural feature of contemporary political economy, but persists by design to serve certain ends. Adam Haslett, author of the excellent novel Union Atlantic, has a smart essay in this vein:

One of the . . . effects of this dramatic rise of finance capitalism has been to steadily erode the general public’s ability to understand how the modern economy actually functions. Most people can understand what political forces are at play when a union demands higher wages and a company resists, citing foreign competition. We can choose which politician to vote for based on the position they take in such a conflict and have a reasonable sense of whose interests we are supporting by so doing.

But what happens when a politician says we must lend billions of dollars to undercapitalized banks or indebted countries in order to provide liquidity to the financial system, and if we don’t we will enter a depression or blow up the euro? The content, let alone the truth, of such a proposition is hard for most people to assess. . . .

And so people get angry: They get angry at bankers, at politicians, at entire countries for not budgeting more carefully, and at the press for failing to explain what’s going on in such a way that they can understand where their interests actually lie. Which brings us to our current moment. In the United States the bleak economy and the increasingly oligarchic division of wealth have led to protests on a scale not seen since the 1960s. . . .

It is little comfort to be able to step back and see that this crisis is part of a much broader and endemic instability in Western capitalism that continues to redistribute wealth upward, weaken democratic institutions, and concentrate power in the hands of the few. But it is this larger force, not the daily ups and downs of the current troubles, that will continue to shape our lives for decades. Even if we cannot at present see a path to reversing this force, we can at least endeavor to understand it more clearly.

The response to these protests could be a new New Deal, or a ratcheted-up security presence of drones and integration of “suspect” protester status into a burgeoning reputation industry. (As one of the commenters on an earlier post of mine said, apropos of the 5000 or so protesters arrested already: see how easy it is to get a job when you have an arrest record.) It gets harder by the day to imagine other paths back to order.

“Robert Lee visited a dentist, Stacy Makhnevich, because he was suffering from a severe toothache, caused by a painful infected cavity.  She refused to treat him until he signed a so-called “privacy” contract, which included a clause preventing him from posting negative reviews of her online.  [The clause read: "Patient will not denigrate, defame, disparage, or cast aspersions upon the Physician; and (ii) will use all reasonable efforts to prevent any member of their immediate family or acquaintance from engaging in any such activity."]

More specifically, the contract stated that Lee would not publish adverse comments about Makhnevich’s performance online, and [...]]]> In light of some of my previous posts on nondisclosure clauses and their enforceability, I thought readers might enjoy the following story:

“Robert Lee visited a dentist, Stacy Makhnevich, because he was suffering from a severe toothache, caused by a painful infected cavity.  She refused to treat him until he signed a so-called “privacy” contract, which included a clause preventing him from posting negative reviews of her online.  [The clause read: "Patient will not denigrate, defame, disparage, or cast aspersions upon the Physician; and (ii) will use all reasonable efforts to prevent any member of their immediate family or acquaintance from engaging in any such activity."]

More specifically, the contract stated that Lee would not publish adverse comments about Makhnevich’s performance online, and that he would assign the copyright of any online commentary that he did make to her (presumably so that she could have such commentary quickly and directly taken down if she found it objectionable).

Lee signed the contract.  But later—after receiving a hefty bill for service that he viewed as problematic—he posted negative reviews of the dentist on Yelp.com and DoctorBase.com, despite the contract’s ban on such postings.

The Yelp.com review said:  “Avoid at all cost! Scamming their customers!”  The DoctorBase.com review was similar.

Lee claims that Makhnevich then– in an attempt to enforce the contract—tried to get Lee’s negative reviews taken down from the review sites.  He alleges that she also started billing him $100, as a fine, for every day the reviews remained on the Internet.  Moreover, Lee alleges, she refused to send copies of his billing records to him so that he could seek reimbursement from his insurer.  Makhnevich also sent Lee a notice threatening a lawsuit.  In response, Lee filed a lawsuit of his own.

Lee’s lawsuit calls the contract he signed invalid under state law as an unconscionable contract.  The lawsuit also alleges that posting one’s own commentary on a website such as Yelp.com or DoctorBase.com constitutes “fair use” under the copyright laws.

In the suit, Lee asks that the agreement that he and other patients signed with his dentist be declared void and unenforceable, and that she be barred from requiring assent to these agreements by future patients.”

So many great issues here — the penalty/liquidated clause damage term; the privacy/nondisclosure nexus; the unenforceability argument coupled with a lurking first amendment claim.  The story claims there’s even a consideration defense, though I can’t see how that’s really present on these facts.

As I’ve expressed before, I think these kinds of nondisclosure agreements are more difficult to enforce and obtain damages from than most conventional accounts would have it, and that they often function, like liquidated damages in general, to compel parties to engage in behavior that a court would not actually order.  This case seems like a good test of my theory.  I’m very glad that the Center for Democracy and Technology has taken up the battle.

(H/T: Reader T.G.)

It’s difficult to answer these questions without understanding the past and present tactics of the groups OWS is protesting. We can learn something about those tactics from Jeffrey A. Winters’ book Oligarchy and his recent articles. In Winters’ treatment of America’s politics of wealth defense, we can discern a transition from high-stakes defiance of government tax authority [...]]]> The OWS protests have provoked reflection on the morality of direct action and civil disobedience. How far should the police go to spy on, disrupt, or punish peaceful protesters? Is pepper spray a dangerous chemical agent or “a food product, essentially?” Does current American inequality merit a direct action follow-up to the Civil Rights Movement, whose mass-arrestees and water-cannoned marchers are now viewed as heroes?

It’s difficult to answer these questions without understanding the past and present tactics of the groups OWS is protesting. We can learn something about those tactics from Jeffrey A. Winters’ book Oligarchy and his recent articles. In Winters’ treatment of America’s politics of wealth defense, we can discern a transition from high-stakes defiance of government tax authority to an established position “inside the system.”

Winters recounts how Congress passed a tax on the top 0.1% in 1894, only to be slapped down by a Supreme Court “which struck it down in a 5-4 decision.” After the 16th Amendment effectively repealed that Supreme Court decision, Congress had the novel idea of actually helping pay for a war (WWI) with revenue from those best able to fund it. As Winters notes, “the highest rate [leapt] from 7 percent in 1915 to 77 percent in 1918,” and “the number of brackets went from seven to 56 over the same period.” This provoked direct action from the wealthiest “through tax avoidance and outright evasion.” At this point, Winters writes,

The government faced a difficult choice. Basically, it could either beef up law enforcement against oligarchs and design better systems to track and tax their incomes to force them into compliance, or abandon the effort and instead squeeze the same resources from citizens with far less material clout to fight back.

Within a few years, the government chose to back down. By 1926, “the single most progressive economic policy ever enacted in U.S. history—–an income tax exclusively on the rich—–was slowly inverted into a mass tax that burdens oligarchs at the same effective rate as their office staff and landscapers.”

New Deal policies helped level the playing field, as the gains from economic growth were spread relatively evenly between income groups between 1947 and 1974. But by the early 1970s, income and wealth gaps skyrocketed once again. Here, Winters adds evidence to the Pierson/Hacker and Bartels theses that the power (not the productivity) of the wealthy is the most important engine of our sky-high inequality. Winters describes the symbiotic and mutually reinforcing effects of legal, political, and cultural power here, coordinated by an “income defense industry:”

The income defense industry is comprised of lawyers, accountants, wealth management consultants, revolving-door lobbyists, think-tank debate framers and even key segments of the insurance industry whose sole purpose is income defense for America’s oligarchs. . . . In the 1970s, oligarchs paid an average effective tax rate of about 55 percent, which was almost 80 percent of the top published rate. By 2007, the top 400 income earners in America paid an effective tax rate of 16.5 percent, which was barely 50 percent of the top published rate.

Navigating through the almost 72,000 incomprehensible pages of tax code they had helped draft, industry specialists today structure complex partnerships and tax shelters that few IRS auditors can disentangle, or in some cases even fully understand. . . . The U.S. Senate estimates that the income defense industry helps America’s oligarchs avoid paying about $70 billion in taxes a year through what the IRS calls “abusive offshore tax avoidance schemes” alone. This is a sum equal to the boon the Bush tax cuts give to the entire top 2 percent of income earners (a group twenty times as numerous as America’s oligarchs). . . .

The top 0.1%’s share of society’s wealth and power is a critical political issue. This top thousandth takes about half of all capital gains, taxed at a delightfully low rate. Although some academics in the wealth defense industry may explain that rate as “economically efficient,” we can also see it as a direct result of plutocrats’ defiance of the law. Tax evaders of the roaring 20s were the 0.1%’s Rosa Parks.

Image Credit: Moderate Voice is trying to find source.

by Ciara Torres-Spelliscy

As I told my law students in a recent class, when I was in law school, no one cared a fig about corporate political spending.  I did not hear about it in Constitutional Law, Corporate Law or Fed. Tax.  It was a non-issue because for the most part, it was banned.  It made sense that back then, the SEC would not have a corporate political spending reporting requirement.  That would have been tantamount to the agency’s asking, “have you committed any federal election [...]]]> Ciara Torres-Spelliscy is an Assistant Professor at Stetson University College of Law and the co-author along with economist Dr. Kathy Fogel of Shareholder-Authorized Corporate Political Spending in the United Kingdom.  I am posting her views on American corporate political transparency below [FP]: 

by Ciara Torres-Spelliscy

As I told my law students in a recent class, when I was in law school, no one cared a fig about corporate political spending.  I did not hear about it in Constitutional Law, Corporate Law or Fed. Tax.  It was a non-issue because for the most part, it was banned.  It made sense that back then, the SEC would not have a corporate political spending reporting requirement.  That would have been tantamount to the agency’s asking, “have you committed any federal election crimes?”  Now that such political spending is legal, the SEC should respond to the growing calls for a new disclosure rule.

Much has changed in the years since I was on the business end of a Con Law exam.  In particular, in 2010, the Supreme Court did away with corporate source limits on election ads altogether in the infamous Citizens United case.  The upshot of this case changed not just federal law going back to 1947, but also state laws, some of which dated back to the turn of the twentieth century.

The new normal is corporations can spend an unlimited amount of their treasury funds on independent political expenditures in local, state and federal elections.  This brings us back to the SEC and its utter lack of political disclosure rules.  Because of this gap, publicly-traded corporations can spend in elections without ‘fessing up.  This seems odd given how passionate shareholders are about transparency.

In the summer of 2011, ten corporate law professors petitioned the SEC for a new disclosure rule to rectify this situation.  These professors are both conservative and progressive, yet they all agree transparency of corporate political spending is a must.

Economists have already written in support of the professors’ petition.  Economist Dr. Michael Hadani of Long Island University noted that one of the reasons why shareholders should want more reporting on corporate political spending is that it can backfire.  His regression analysis of over 1,100 companies over an 11 year period found political spending had a negative impact of firms’ market value.

Economist Dr. Susan Holmberg, Program Director at the Center for Popular Economics, also argued that transparency would bring more efficiency to the market by reducing monitoring costs for investors of managers’ spending corporate resources in politics.

Shareholders have also weighed in loudly in support of more transparency of corporate political spending.  Over the past few years, shareholders have been calling for transparency company by company in shareholder resolutions.  And shareholders are asking the SEC for a new rule as well:  on November 1, organizations managing $690 billion on behalf of individual and institutional clients filed a comment urging the SEC to act.

As I pointed out in my comment to the SEC, the US is embarrassingly over four decades behind the UK which has required disclosure of corporate political spending since 1967 under the Companies Act.  The UK can offer some pointers on how a rule might work here.  In the UK, political expenditures over £2,000 are included in the directors’ report to shareholders.  The company must say where the money was spent and the law covers not just political spending in the UK, but also in all EU member nations.

The SEC, of course, has a lot on their plate, including finishing the Dodd-Frank rules.  But this is important to the integrity of our markets as well.  And the Commissioners don’t have to look very far for model language.  They could copy some from the Shareholder Protection Act pending in Congress or they could lift some language from our friends in jolly old England.  The ball is now in the SEC’s court.  As an investor, I hope they step up and do the right thing.