Freedom and the Lawmakers – Econlib

• A Book Review of Over Ruled: The Human Toll of Too Much Law, by Neil Gorsuch and Janie Nitze.

Liberties, Thomas Hobbes wrote, “depend on the silence of the law.” Nowadays the law is very chatty.

Here are three examples from the new book by Supreme Court Justice Neil Gorsuch and Janie Nitze, Over Ruled: The Human Toll of Too Much Law, followed by a discussion.

Three examples

First example. After Hurricane Katrina wreaked havoc on a pine forest that provided timber and a source of income, the thirty-six monks of the Saint Joseph Abbey in Saint Benedict, Louisiana, had to search for other ways to support themselves.

“For years, they had made simple wooden caskets in which to bury their departed colleagues.” Then they decided to make it a trade, selling a traditional casket priced at $2,000 and a “monastic,” cheaper, option for $1,500. Not long after the monks started offering caskets to the public, the Louisiana State Board of Embalmers and Funeral Directors intervened.

The Louisiana State Legislature had created the Board in 1914 to regulate “the care and disposition of the deceased.” Ninety years later, eight of the nine board members were funeral industry participants who, understandably, did not like competition that much. The Board explained to the monks that, under state law, only licensed funeral homes could sell caskets to the public, and to become one you needed to comply with all sorts of requirements, including having a “full-time funeral director who had completed thirty credit hours at an accredited college, finished an apprenticeship, and passed a test administered by the International Conference of Funeral Service Examining Board.”

Since the monks (who were not opening a funeral home but were trying to sell caskets to families) didn’t comply with the regulation, the Border Patrol of Embalmers issued a cease-and-desist order commanding them to stop selling caskets. It also subpoenaed two abbey officials to testify and threatened them with fines and potential time behind bars. Only “after a federal lawsuit and six years of wrangling with the Board, in 2013 the monks finally won the legal right to enter the Louisiana casket market.”

What was all this ordeal for? “Between 2007 and 2010, the monks sold sixty caskets in a state that sees 40,000 annual deaths.” Sixty.

Second example. In his Key West home, Ernest Hemingway had a polydactyl cat. Cats normally have five front toes and four back toes. Polydactyl cats have more toes in one or more of their paws.

The descendants of that cat still live in the Ernest Hemingway Home & Museum. The Museum is very proud of them, as you can see by looking at its website, which features them prominently. In 2003, an official from the U.S. Department of Agriculture visited and explained that “the museum needed a license to keep its cats. What’s more, the agent said, the cats should be confined to cages or individual shelters for their safety.” The museum staff were perplexed. For one, “the cats have lived good lives roaming the property for more than forty years.” For another, caging uncaged animals did not sound particularly pet-friendly.

This was all based on a federal law requiring animal “exhibitors” such as carnivals, circuses, and zoos, to have a license for their exhibited animals. Agency official in charge of applying the law defined “exhibitors” to include not just carnivals, circuses, and zoos, but also “animal acts” and “educational exhibits.” Hence, Hemingway’s cats.

The federal agent came back a number of times. Several issues were raised: the museum needed to hire a night watchman for the cats. Or cut their number. Or put a hot wire to shock cats attempting to leave the property. The museum applied for a license, twice, then was threatened with confiscating the cats and fines of $200 a day for each animal on the property. “The whole ordeal dragged on for five years before the agency granted the museum a license after it made a few modifications to the property.” The museum “spent at least $200,000 dealing with agency officials and their animal regulations.” We don’t know how much the taxpayers spent but “CBS News documented fourteen trips by agents and a $17,000 cat evaluation.” For what? To control nineteen exemplars of the most uncontrollable species ever: cats.

Third example. In 2007, a state wildlife agent boarded the boat of John Yates, a fisherman in Florida. The agent came for a safety inspection but then asked to open the fish hold. He wanted “to measure the fish—all two thousand pounds of them… . According to his measurement (which John disputed), 72 red grouper were under the 20-inch harvesting minimum set by then-current regulations.” A few days later, the same stock of fish was measured again. This time the agent found 69 undersized fish, not 72.

Three years later, seven agents in bulletproof vests visited the Yates house. They informed Yates’s wife, Sandra, that her husband “stood accused of violating the federal Sarbanes-Oxley Act and faced a potential term of twenty years in prison.” Sarbanes-Oxley we all remember as a reaction to the Enron scandal: was Yates a disguised Gordon Gekko just pretending to fish for a living? Sadly, no: “that law is written in broad terms. The Act doesn’t just make it unlawful to destroy financial records or documents ‘with the intent to impede, obstruct, or influence’ a federal investigation. It also prohibits the destruction of any other ‘tangible object’ for the same purpose.”

“The government’s theory ran this way: John or a member of his crew must have thrown overboard the undersized fish [that is, the original 72] the agent had identified while out on the water. Before retiring to port, the crew must have then replaced those fish with new (and still undersized?) substitutes… On the basis of this theory, the government argued, John had destroyed a “tangible object”—yes, fish—with the intent of impeding a federal investigation.” The Yates were eventually cleared by the Supreme Court in 2015. But meanwhile they lost everything they had; it was estimated that the taxpayers spent as much as $11 million prosecuting the case.

For what? For 69 (or 72) red groupers. By the way, “when the agent boarded John’s boat in 2007, the minimum harvesting size for red grouper was 20 inches. By the time John was arrested three years later, that had changed. The new rule? Eighteen inches.” None of the contested fish would have been considered small three years later, by the same agency. Monty Python couldn’t have devised this.

Discussion

These three examples, with many others, are used by Gorsuch and Nitze to illustrate the consequences of the United States being “over-ruled.” Most of the stories come from Justice Gorsuch’s life on the bench, either at the Supreme Court or at the Court of Appeals for the Tenth Circuit.

The inescapable lesson of all these examples is that the United States is now “a nation of laws.” Not a nation under the rule of law. Why? In part because of a House and a Senate that never sleep, in part because of the administrative state envisioned by Woodrow Wilson to put the best and the brightest at the helm of the nation, in part because judicial review became toothless.

Gorsuch and Nitze provide some figures of the paper blizzard sweeping over Washington, D.C. “Less than a hundred years ago, all of the federal government’s statutes fit into a single volume. By 2018 the U.S. Code encompasses 54 volumes and approximately 60,000 pages. Over the last decade, Congress has adopted an average of 344 new pieces of legislation each session. That amounts to about 2 or 3 million words of new federal law each year.” Agencies “publish their proposals and final rules in the Federal Register; their final regulations can also be found in the Code of Federal Regulations. When the Federal Register started in 1936, it was 16 pages long. In recent years, that publication has grown by an average of more than 70,000 pages annually. Meanwhile, by 2021 the Code of Federal Regulations spanned about 200 volumes and over 188,000 pages.” And “not only have our laws grown rapidly in recent years… so have the punishments they carry.”

These numbers are frightening and are of particular moment to the European reader. They incinerate the hypothesis, still dear to many, that the United States is different and inherently more liberal than European nation states. Woodrow Wilson, Gorsuch and Nitze argue, wanted to make America more European. He won, no question.

Yet these figures are known to the policy wonk, who probably has already run into them reading some think tank report. What Gorsuch and Nitze add, by making cases into stories like the three examples we have seen, is evidence of what this all means to common people. Even those among us who are most concerned with over-legislation in theory are lucky enough to have limited, direct experience of it. The university professor can pontificate about the complications of building codes, but she will realize what a nightmare they are only the moment she’ll have to renovate her flat. Only experts have a precise knowledge of how regulations of this or that activity work. Experts tend to approve of regulations that they drafted or advised on. Stories like the ones Gorsuch and Nitze produce allow us to put ourselves in the shoes of those who are regulated.

The number of rules is so high that even those who are charged with violations may be unaware they did anything unlawful—as in the three cases we mentioned. If they ever figure out whether they did or not will depend largely on how lucky they are. If they are rich, powerful, and can buy good legal advice, the impact on their life can be modest. Not so if they are the John Yateses of this world. Gorsuch and Nitze stress that regulation as we know it undermines a fundamental principle of the law: equal treatment of people. Legal complications impact even more heavily those who cannot pay good lawyers- and even more so those who simply focus on their daily undertakings, without identifying potential legal challenges ahead. This is in striking contrast to the rhetoric of regulation, which is supposed to be protecting the little guy against the big shots. More often than not, the lawmaker is captured by those of her constituents who regularly invite her to dinner.

Gorsuch and Nitze will be accused of cherry-picking, but their choice of stories shows the ultimate disproportion between the requirements and their enforcement practices and the public good they are assumed to serve. Their reader, whatever her philosophical persuasion, may easily agree that 69 (or 72) undersized fish do not match in importance the life of a family, that a handful of caskets aren’t worth years of prosecution, and that the Hemingway cats can do without the federal government. The costs are high, the alleged social benefit turns out to be minuscule. But Gorsuch and Nitze also show that no awareness that they were over the top ever crossed the minds of federal agents who thought they were just doing their job. We did get the best and brightest in the administrative state exactly for taking care of the details, didn’t we?

The Founding Fathers, or at least one of them—James Madison—thought lawmaking should be cumbersome precisely for this reason. “In governments where lawmaking is easy”, he maintains, laws can become “so voluminous that they cannot be read, or so incoherent that they cannot be understood” and they may “undergo such incessant changes that no man, who knows what the law is today, can guess what it will be tomorrow.” In his Freedom and the Law, Bruno Leoni argued that it was misleading to identify the certainty of the law by the mere verbal precision of statutes. Legislators can change written law as they wish, and in fact they do. Leoni was writing when the administrative state was just starting to grow its tentacles and focused on Parliament-made statutes. Now we have administrative agencies that can supplement legislation in the way they see fit, often being both prosecutor and judge at the same time. The fact that we have the above-mentioned Code of Federal Regulations does not mean that we have certainty; it is a book whose pages grow and change year by year.

Gorsuch and Nitze have written a courageous and profound book. For one thing, in sharp contrast with a hypocrisy common in the legal profession and even more so among conservatives, they have no problem in stating explicitly that laws are a “restriction to liberty.” If we should care about the “rule of laws,” it is precisely because it implies a series of practices that should set a check on the lawmakers, not make them the rulers of our life. “Some law is surely essential to our nation’s flourishing and our well-being as individuals. But what happens to rule-of-law values when we demand ever more from the law, when we insist on national rules before considering local solutions, and when we permit unelected officials to make more of the rules that govern us?”

In their embrace of the system set up by the Founding Fathers, Gorsuch and Nitze point out that the Founders had a solution, of course imperfect and fragile as any human undertaking. It is federalism. The virtue of a federal system, in which states are sovereign on all matters not explicitly delegated to the central government, is that it allows for experiments. Trying out something at the local level, on a smaller population, before making it a nation-wide requirement, is prudent.

But it is also consistent with something Gorsuch and Nitze stress over and over: the limitations of our knowledge. Our knowledge is imperfect, and even the most competent of experts can only know so much. Furthermore, knowledge is dispersed in society and the kinds of information that are relevant to do something are often inaccessible to lawmakers and regulators who are not themselves part of the processes of production, boots on the ground. Gorsuch and Nitze’s book reminded me of some of the crucial insights of F.A. Hayek. Hayek did not assume socialism would collapse because it was more corrupt, or its incentives spurred bad management. He thought planners can be as honest and hard-working as private entrepreneurs. But they could not, even at the cost of great effort, assemble the same kind of information that a decentralized decision-making system such as the market seamlessly processes though the price system. Gorsuch and Nitze praise the vision of the Founders as a vaccine against the hubris of lawmakers.

While Gorsuch and Nitze chastise the administrative state for much of the excessive rule-making we are living under, they do not naively believe that, were Congress to regain its role as a legislator, things will be easily fixed. They see over-legislation as having multiple layers, and ultimately being a work of society as a whole. Even experiments at the state level are nowadays run in its spirit: speaking of licensing, in Annapolis, Maryland, you can’t work as a fortune-teller without a license.

One of the reasons we have too many laws in the United States and throughout the Western world is that people want them. If a society believes that any problem has a solution known to the lawmaker, it will end up with more and more laws as more problems surface. Gorsuch and Nitze point out how this attitude is jeopardizing the whole of the legal system that the Founding Fathers built on British common law.

They suggest the problem may be solved through education, by teaching civics and infusing the new generations with a renovated American spirit. That may be needed, as “less than half of Americans can name the three branches of our federal government,” but it would hardly suffice. Another reason we have over-legislation, one that Gorsuch and Nitze do not explore, is that we can afford it. Whatever inefficiency the legal system can foster, the market economy so far has seemed to be able to carry it in its back pocket. At the time of the Founders, a modest increase in taxation might have bankrupted a family; hence the people were very sensitive to taxes. If regulation is taxation, the same can be said for rules.

Gorsuch and Nitze know that we delegate so much to politics because “we trust one another less and less. When a problem arises, we are no longer so inclined to rely on individual judgment, our neighbors, or our local institutions to address it.” The United States was supposed to be a high trust society, but it is no longer, and the absence of social trust paves the way for political control. How trust can be regained, other than lamenting that the “habits of the heart” of a time past are no more, is unclear.

Still, a book is not expected to solve the world’s problems. But if it identifies them with great clarity and new insights, it already does more than what is expected of it. This is the case of this splendid work, a manifesto for legal common sense and limited government of the sort we haven’t seen in years.