On Socializing the Constitution of Economic Coordination

On Socializing the Constitution of Economic Coordination

This post is part of our symposium on socialist constitutionalism.

Sanjukta Paul–

Professor Forbath’s essay, drawing from his research into the Weimar Constitution, urges us to reconsider what we mean both by socialism and by constitutionalism. He recovers and makes vivid a socialist vision that is neither about (simply or necessarily) “nationalizing” industry nor only about redistributing the material benefits of economic activity, but about creating participatory structures of decision-making across both the “public” and “private” spheres that empower workers and others who are currently largely excluded from it: in short, robust economic democracy. The essay also hints toward a broader sense of “constitutionalism,” encompassing not only the drafting and interpretation of public constitutions, but also the re-constitution of putatively private or semi-private associations like business corporations and labor unions. These two reorientations are connected by one of the grounding LPE principles: that law constitutes markets. Centering the constitutive power of law destabilizes the usual public/private distinction and enables a vision of socialism that incorporates transformative reforms to “private” entities—and that has room for localism and decentralization, where appropriate.

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Progressive Democracy and Legislative Form

Blake Emerson

Adrian Vermeule recently made a stir with his proposal for a “common-good constitutionalism.” He argued that originalism had “outlived its utility” now that the right had gained power on the federal bench. Instead it was time for a “substantively conservative approach to constitutional law and interpretation.” We got only a few peaks at the substance, however. It included labeling individual autonomy, including abortion rights, as “abominable,” and jettisoning “the libertarian assumptions central to free speech law.”

Responses have examined whether Vermeule’s constitutional theory is defensible, or rather winks more or less subtly at authoritarian or even fascist ideas. But to me the most striking aspect of the argument was not the substance of the values Vermeule would ascribe to the Constitution, but rather the form of his conservative constitutional structure. Vermeule proposes a version of constitutionalism that, much like the Law-and-Political-Economy framework, goes “Beyond the Twentieth Century Synthesis” in abandoning the liberal separation of the state from the “private” spheres of the market and family. In contrast to the LPE approach, however, Vermeule’s constitution puts hierarchy at the center of its moral universe, with a strong executive at the top. In the mirror of Vermeule’s constitutional frame, we can glimpse the progressive alternative.

Common-good constitutionalism “does not suffer from a horror of political domination and hierarchy,” but rather expects that “[s]ubjects will come to thank the ruler” for fostering “more authentic desires.” Vermeule thus emphasizes a pre- or post-liberal form of government in which the people are rightfully subject to the discretionary authority of political leaders. He prioritizes the executive branch over others, favoring “a powerful presidency ruling over a powerful bureaucracy,” which acts as “the strong hand of legitimate rule.”

These structural commitments are in line with the theory of the “unitary executive,” which can be traced back to Alexander Hamilton’s defense of a “vigorous” presidency in the Federalist. That enlarged conception of the office has continued to influence landmark Supreme Court decisions from Chevron to the Travel Ban Case. But there is another thinker who deeply informs Vermeule’s analysis: Carl Schmitt, the conservative critic of Germany’s Weimar Republic who became the crown jurist of the Third Reich before falling out of favor with the Nazis.

For Schmitt, the Weimar Republic showed that liberalism’s commitment to positive law, rational deliberation, and individual rights was too brittle to withstand serious economic and political crises. Parliamentary democracy gave way to a “governmental state” in which the executive rather than the legislature made the important decisions. Schmitt did not bemoan this transition, but rather envisioned a direct connection between the substantive values of the Volk and the bureaucratic apparatus of the state. Vermeule, of course, disavows Schmitt’s Nazism, and instead fastens onto his critique of liberal legalism, as well as his interest in religious-bureaucratic political form. He follows Schmitt in privileging the executive branch as the best vehicle to carry out a conservative ethical vision.

Some of Schmitt’s most prominent opponents on the left offered up models for an alternative, social-democratic economy of political power. Scholars like Hermann Heller and Franz Neumann endorsed the norms freedom, the rule of law, and the separation of powers that constitute the liberal ideal of the Rechtsstaat. But they argued that those norms could only be preserved under the conditions of twentieth-century capitalism by transforming the bourgeois Rechtsstaat into a social Rechtsstaat. Such a social-constitutional state would infuse economic relations with material equality, and ensure that monopoly power did not undermine individual and collective autonomy. In stark contrast to Schmitt, these thinkers prioritized the legislature over the executive, and bound the latter closely to the norms of the former. Because Heller and Neumann’s hope was to institute general, egalitarian norms through democratic processes, the legislature had to play the lead constitutional role. Momentary decisions of a charismatic leader would not suffice to firmly entrench social equality.

This correlation between the left and the legislature, on the one hand, and the right and executive, on the other, also has purchase for us in America today. Conservatism of Vermeule’s and Schmitt’s variety is grounded on authority, discretion, and hierarchy. It relies on the obedience of subordinates to the commands of superiors who know better, have keener judgment, or who command greater allegiance. That vision runs like a red line through reactionary models of both economic and political structure. While the rhetoric of freedom, choice, and competition pervades the American right, its legal interpretations and policies often function to preserve various kinds of concentrated power, exercised by some persons and groups over others. The last forty years of conservative ideological dominance has generated stark social hierarchies: employers now exercise arbitrary power over employees, monopolists control consumers and smaller firms, capital accrues the gains from labor; status hierarchies surrounding religion, sex and gender, and race are conceived to reflect a “natural” ranking of superior and inferior.

Executive-centered constitutional structure works in parallel to such legally sanctioned social domination. It subjects the hitherto “independent” civil service to the strong hand of presidential leadership, displacing various forms of disciplinary competence, administrative due process, and public input with assertions of value by the “Chief Executive.” This affinity for an “unbound” executive has animated conservative constitutional scholarship since Reagan. As Bill Barr claimed in his strident criticism of the Mueller Investigation, the president “alone is the Executive branch,” and subordinate executive officers are merely “his hand.”

Progressives, by contrast, should be steadfastly committed to legislative constitutional forms. That is because democracy is concerned not with the command of a single person but with reaching a decision amongst a plurality of persons. That process respects the equal worth of each participant. It models a form of human association that recognizes autonomy and yet brings people together to identify shared goals and values.

Legislation should be viewed as an iterative process of popular will-formation. David Grewal and Jedediah Britton-Purdy have shown how democratic constitution-making is a legislative act of the sovereign people to erect a government that acts on their behalf. Ordinary legislation replicates this process within the government, as it brings together the several representatives of the people to reach binding agreements and empower marginalized groups. Maggie Blackhawk, for instance, has shown how the Indian Reorganization Act of 1934 helped to “foster power and to promote collective action” by sovereign Native peoples. Legislative rulemaking within the executive branch takes this democratic empowerment one step deeper down, giving affected groups a role in deciding how economy and society are regulated. As Matthew Cortland and Karen Tani have documented, progressives have used the public comment process during the Trump Administration to thwart unjust and arbitrary executive actions ranging from approval of Medicaid work requirements to narrowing the definition of sex harassment in education. Kate Andrias has unearthed precedents in the New Deal for establishing workplace democracy in and through the administrative process. I’ve explored in my own scholarship how this legislative version of agency procedure stretches back to the institutions and ideologies of the Progressive Era.

The legislative left therefore does not ignore or sideline the executive branch, but rather aims to recreate parliamentary values, processes, and organizations within the executive. A corollary to this vision is that the president should not be able to fire executive officers at will, as the unitary executive theory would hold. The scope of the president’s removal power is currently before the Court in Seila Law v. CFPB. An executive branch that honors democratic principles should recognize a qualified equality amongst officials. Officers whom Congress has given rulemaking powers should not be subject to implied direction by the president, but rather should lead a broader deliberative process that incorporates affected publics.

Such a legislative constitutional structure, it should be noted, runs counter to strong tendencies and historical traditions amongst American Progressives. From Teddy Roosevelt and FDR to LBJ and Obama, egalitarian programs have often relied on an empowered presidency. And I don’t wish to malign the important persuasive role the president can play as a spokesperson for the people, nor the movement building potential of executive action. But much is lost in pinning our hopes on a particular presidential candidate and what she or he can accomplish once in office. That approach is particularly likely to fail with a conservative Supreme Court that will strike down “novel” administrative actions, or deny deference on “major questions.”

Progressives and social democrats are concerned with freedom, equality, and solidarity. While there might be temporary victories for such values in the hands of a capable and charismatic president, a durable democratic future must take a form that mirrors democratic substance. If we want to recognize and institute the equality of persons, we must all become legislators.

Blake Emerson is Assistant Professor of Law at the UCLA School of Law.

What Comes After Money Bail? An LPE Perspective on Pretrial Detention

This is the first post in our series on Money Bail. Click here to read all posts in the series. 

Jocelyn Simonson

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(via NBC News)

It is no longer controversial to say that our current system of money bail is flawed. When more than 400,000 people are incarcerated pretrial at any one time—a majority there because they cannot afford the amount of money that a judge has set—we are doing something wrong. Money bail is a stark and prominent indicator of how the criminal legal system punishes based on poverty, and by extension, race. And so, with a tentative consensus that there is a problem, we are well into a “third wave” of bail reform throughout the United States.

But what comes after money bail? As we think about pretrial detention, incarceration, and the criminal legal system more broadly, how can we widen the scope of our thinking beyond the relatively simple idea that money bail is unfair to poor people to larger imagining about the harms of pretrial detention and even criminal adjudication itself? This week, the LPE Blog will feature a series of posts that get at that question through a combination of critiquing current responses to bail reform and prefiguring a freer world without money bail. The goal is not to put forth model reform proposals, but rather to push for a larger vision of how the state provides safety and security in the face of both harm and structural neglect, and to connect that vision to our systems of money bail and pretrial detention. Continue reading

Money and Property

Money and Property

NB: This post is part of the “Piercing the Monetary Veil” symposium. Other contributions can be found here.

Lua Yuille and Rohan Grey —

Money and property law are mutually constitutive. Property rights are defined and valued in terms of their relationship to monetary instruments, while whether something counts as a monetary instrument for this or that purpose is itself a result of bundling property rights a certain way. Yet property law treats money as opaque: a neutral measuring stick that happens to prove useful in the process of doing the real work of property.* This is partly because money is grossly under-theorized and misunderstood by property law scholars. In property law, “money provides the unit in which prices appear, supplies a medium of exchange, and acts as a store of value”, but it does so as if by magic. Unlike students of economics, who are introduced to money through the self-consciously ahistorical fable that money evolved as an evolutionary response to the inefficiency and inadequacy of barter, American law students are not formally introduced to money at all. Money is taken as an idea that needs no articulation or unpacking. The result is a  ‘functional monetary illiteracy’ that fails to conceptualize the complicated relationship between money and property law, serving to obscure the role of the state and of private power in defining each.**

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Money as a Constitutional Medium

Money as a Constitutional Medium

NB: This post is part of the “Piercing the Monetary Veil” symposium. Other contributions can be found here.

Christine Desan —

In 2017, the Federal Reserve Bank of New York published a comic book on the origins of money. The story, called “Once Upon a Dime,” unspools sweetly. Far far away, on the planet Novus, a community of good-willed humanoids live together, trading what they have for what they need – mustard for fish, wheels for cakes. In good time, the inconveniences of barter push them to innovate. All agree to give and take artfully carved river stones as money. That eases their trade; they can “Do It More Efficiently” (thus the “dime”) and the little community prospers. People soon warehouse their rocks with a caretaker, who begins allowing customers to transfer rocks from one account to another by check. The caretaker also advances some of the funds he has “stored here at the bank.” Inter-bank loans follow naturally, as does a run on the banks. In the end, the group establishes a central bank to monitor the other banks and lend them money during emergencies.  In short, “first money replaced barter,” then banks developed “as storehouses” and as lenders, then the group appoints a central bank to supervise the banks.

“Once Upon a Dime” does not stray from the conventional story about money. To the contrary, it reinforces the tale, teaching it at a primary level and in living color. That makes the comic all the more arresting: it makes a constitutional argument about the nature of money and its place in society even as it deflects attention by casting the medium as a mechanical fix for a private problem.

Consider, first, the way the comic locates money firmly within the sphere of individual choice as opposed to the political will: money is the product of entrepreneurial initiative (the proposal to use rocks as a medium), adopted by social acclaim (convention as opposed to public authority), and targeted at a technical problem (awkward exchange). Distribution is assumed; the river rocks somehow spread around society. Banks evolve from a storage mechanism, a phenomenon of convenience more than credit. As for credit, it simply shifts resources, rather than creating new value, a service like any other. The central bank is only ambiguously “public,” an institution that will enforce self-evident standards of practice and provide occasional rescue.

Consider, in turn, the way the narrative diverts our attention as lawyers. By locating money as an inert medium and banks as the mechanism that pools and shifts the medium, the story asserts them only and emphatically as technologies of exchange.   Public authority surfaces only as a coordinating mechanism, occasioned to resolve a predictable collision of individual demand. If money operates on earth as it operates on Novus, there is really nothing much for us to see.

That is where the story falls apart.

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The Constitution and Democratic Insurgency

Aziz Rana—

One of today’s most urgent questions is how to combine an analysis of capitalism with an analysis of democracy.  The rolling socio-economic crises of the last decade, highlighted by the global financial meltdown, have laid bare the extent to which American society is marked by fundamental and irreconcilable conflicts between those enjoying economic power and those subject to the vagaries of the market.  At the same time, the constitutional system, plagued by legislative dysfunction and extreme counter-majoritarianism, is incapable of implementing popular policy—let alone resolving endemic collective problems.  American capitalism generates profound social and material dispossession, yet American democracy either facilitates these developments or seems helpless to address them.  Why is this the case? And to what extent is the existing constitutional order—its basic ideological and institutional terms—at least partly to blame?

Since the forging of Cold War liberalism in the mid-twentieth century, elites have offered the same, familiar account—in both electoral politics and in the study of constitutional law—of the relationship between the constitutional order and the economy. The prevailing theory is that the structures of legal-political decision-making do not favor particular social groups. Instead, through an intricate system of checks and balances—overseen by a Supreme Court enjoying powers of judicial review—the constitutional process produces essentially just outcomes while ensuring that no single political or social actor wields overwhelming authority.  This structure of constraint substantively pushes decisions away from the extremes of fascism and communism and toward a moderate middle ground of ameliorative reform and steady collective improvement.

Although some may be suspicious of the Whiggish story of progress, a bedrock assumption underlying this account has been widely held—even among left-liberal circles.  This is the idea that the constitutional structure and its discursive traditions remain essentially agnostic as to existing distributional battles.  They can be used productively to pursue virtually any end—up to and including socialism.  As the New Deal victories seemed to confirm, constitutional process and language carry no essential theory of political economy.  To the extent that legal-political outcomes have remained in line with a vision of market capitalism and a limited welfare state, this is simply the product of popular will: the complex balance of views expressed across the constitutional system.

But this account ignores a fundamental critique of the constitutional order, one leveled by labor and black radicalism in the first four decades of the twentieth century before Cold War ideas took such an extreme hold. For those activists, the history of sustained racial, indigenous, gender, and class subordination made clear that the country was not then and had never truly been democratic.  Rather, the constitutional order systematically operated to expand the strength of a racial and economic minority.

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Toward a Law and Political Economy of Gender Violence

Martha T. McCluskey –

What does political economy have to do with the issue of gender violence that roiled Kavanaugh’s Supreme Court confirmation?  One answer is that law should not separate economics from the social inequalities that mediate power.  Violent enforcement of social hierarchies has long been a core capitalist strategy for securing selective economic advantage, as Angela Harris and Frank Pasquale have written in this blog.

The recent #Metoo movement suggests the strong arm and insidious shadow of physical force is common, not marginal, to the everyday economic lives of many women, a factor to bargain with in the process of securing opportunities for education or work, housing or health care.  Conventional law and economics tends to assume a background of private voluntary exchange that belies continuing contests over the power to gain through violence. In contrast, a political economy perspective recognizes that government does not monopolize force. Instead, government enables and distributes private force by how law defines, punishes, monetizes, and immunizes private acts of violence.  Neither formal law nor social norms have firmly settled the questions of what forcible acts and impacts count as normal, excusable, trivial, implausible, or invisible.

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The New Class-Blindness

Cary Franklin —

Legal advocates have scored some major class-related victories in 2018. In January, an appellate court held that the administration of California’s money bail system violated the Fourteenth Amendment rights of indigent defendants. In February, the Fifth Circuit held Harris County’s money bail procedures unconstitutional on the ground that they keep the “poor arrestee” behind bars “simply because he has less money than his wealthy counterpart.” But holdings that explicitly vindicate the constitutional rights of people without financial resources remain rare, and that rarity bolsters the widespread perception that Fourteenth Amendment law offers virtually no protection against class-based discrimination.

It is true that class-based discrimination does not trigger heightened scrutiny under equal protection in the way that race-based and sex-based discrimination do. Fifty years ago—in the era of Gideon v. Wainwright and Harper v. Virginia Board of Elections—it looked to many as if the Court was poised to recognize the poor as a protected class (or perhaps, as Frank Michelman famously argued, to recognize a constitutional right to some form of minimum welfare). But in San Antonio v. Rodriguez and the abortion funding decisions, the Burger Court both declined to recognize the poor as a protected class and rejected the idea that the Constitution guarantees minimum welfare.

Scholars have often viewed those decisions as excising all class-related concerns from Fourteenth Amendment law. But that view has obscured an important and ongoing form of class-related constitutional protection: one that resides not in equal protection but in fundamental rights doctrine. My new article (The New Class-Blindness, forthcoming in the Yale Law Journal) examines the long-standing and often overlooked forms of class-related constitutional protection the Court has developed in the fundamental rights context. These protections have played an important role in some areas of Fourteenth Amendment law for over half a century. But they are now under attack by conservative judges, who have begun to argue, for the first time, that it is impermissible for courts to consider class at all when adjudicating Fourteenth Amendment claims.

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Masterpiece Cakeshop and the Constitutionalization of “Both Sides”-ism

Noah Zatz

mastercakeAt first glance, Masterpiece Cakeshop v. Colorado Civil Rights Commission appears not to be among the more important of this past term’s disastrous Supreme Court opinions. It was issued much earlier than the June blockbusters and has widely been treated as a bullet dodged, allowing a Christian conservative baker to refuse to make a cake for a same-sex wedding but not setting much of a precedent. But something more insidious may be seen at work if one revisits Masterpiece Cakeshop (allowing anti-gay discrimination if it is religiously motivated) in light of not only the travel ban opinion (allowing anti-Muslim discrimination if it is adorned with paperwork) but also the recent “civility” eruption.

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Gender Equality as Social Reproduction Infrastructure

Julie Suk —

On May 30, 2018 the Illinois legislature voted to ratify the ERA. Thirty-seven states have now ratified the sex equality amendment to the U.S. Constitution, just one state shy of the three-quarters required by Article V to validly amend the Constitution. Legal commentary following this news is primarily focused on questions about the amendment’s legitimacy, such as the status of post-deadline ratifications and attempted rescissions, the constitutionality of ratification deadlines for amendments, and the validity of legislation eliminating the deadline. But it is equally important to contemplate how the ERA could change the political economy of gender inequality. It can be more than a symbol that locks in the sex discrimination law we already have. We can take some inspiration from feminist constitutionalism around the world to imagine a twenty-first century ERA that catalyzes new gender-equal infrastructures, particularly for biological and social reproduction, compatible with a sustainable and more humane political economy.

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