Law

A Plague of Sticky Governors?

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governor

The object shown is a governor for an engine. This device was invented by James Watt for use with his steam engine, and has been applied, in one form or another, ever since. It allowed the engine’s use in applications where precise speed control was essential, notably textile manufacturing, and was an invention of great economic and conceptual importance.

It strikes me that the role played by the legal profession and the financial industry is analogous to the role of an engine governor. Like the governor, law and finance are control systems; they are essential enablers and regulators of the activities of the rest of the economy. But also like the governor, the percentage of total system resources that they themselves consume should be reasonably small.

What would we think of a governor that scarfed up 30% of the horsepower of the engine that it was serving? Most likely, we would conclude that it was either poorly designed or inadequately maintained, or both.

There is no question that the legal and financial industries are both vital. Contracts must be drafted, disputes must be adjudicated, and capital must be allocated effectively. But the numbers of people in these industries, and the share of national income devoted to their compensation–along with related expenses such as buildings and computer systems–is perhaps excessive.

For discussion:

1)Would you agree that the legal and finance industries presently represent a more-than-optimal share of the overall economy?

2)If so, what factors have led to this situation? In particular, to what extent is it a function of market failure versus a result of unwise government policy?

3)What, if anything, should be done to correct the situation?

WikiLeaks: Counterpoint at the State Department?

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[ cross-posted from Zenpundit ]

[ note: all links are to youtube videos ]

The pianist Glenn Gould is celebrated for his ability to bring the different and at times positively oppositional voices in a fugue by Bach to our attention, so that we follow each one separately while hearing all at the same time as a single whole. What is less known is that he liked to sit at a table in a truck stop and listen to the different conversations at the other tables and booths, mentally braiding their pale or brightly colored threads of human together into an analogous tapestry — one voice harmonizing with or conflicting against another, here a new subject introduced, there an echo of an earlier idea heard in a fresh context, with the murmurings of waitresses punctuated by the kaching! of the cash register, the hydraulic hiss of a door closing — conversation as counterpoint.

Organizations and individual alike, we all have different and at times dissonant voices, and strive to bring them to some kind of resolution. The many stakeholders debating an issue in town halls, blogs or letters to the editor, the many drives within each one of us, idealistic, hopeful, defeated, paralytic, angry, evasive, sluggish, vengeful, curious, alert, defiant, all have voices, all constitute an experience of polyphony, a “music of many voices”, in point counter point.

One of my interests is to find a way to score these many fugues, these musics of meaning.

My DoubleQuotes, then, can be considered as two-part inventions, attempts to show the multiple tracking of the mind — whether of a single individual, as in this case, or of a group, a community, a world divided so that something of the music begins to be visible, and some of the dissonances can move towards necessary resolution.

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QUOwikileaks

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I believe there is unresolved irony between these two statements, made on the same day by Philip J Crowley, the US State Department’s Assistant Secretary, Bureau of Public Affairs but each has its reasons, and there are arguments to be made for both transparency and opacity, diplomacy and publicity, secrets and revelations.

Between them lies the possibility I think of as a virtual music of ideas.

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Bach published a series of two-part inventions, BWV 772801, and wrote of them that he intended to offer them as an honest method

by which the amateurs of the keyboard especially, however, those desirous of learning are shown a clear way not only (1) to learn to play cleanly in two parts, but also, after further progress, (2) to handle three obligate parts correctly and well; and along with this not only to obtain good inventions (ideas) but to develop the same well; above all, however, to achieve a cantabile style in playing and at the same time acquire a strong foretaste of composition…

Later comes the Art of Fugue.

Complexity or Culture?

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In reading this story about Blagojevich getting a hung jury on all but one charge, this bit leapt out at me:

But one juror, a woman whom other jurors declined to identify, saying they wanted to respect her privacy, never budged in her opposition to convicting on the counts. She was unmoved by recorded calls in which Mr. Blagojevich and his aides spoke of possible jobs, donations, even a White House cabinet appointment he might get after making his Senate choice.
 
Mr. Wlodek described her stance as “very noble,” adding: “She did not see it as a violation of any laws. It was politics. It was more of conversations of what-ifs.”[emp added]

This makes me wonder if Blagojevich got off owing to the political culture of Illinois which assumes that a high level of corruption is simply how politics and government get done. With such a culture, it might seem unjust for a juror to convict Blagojevich for actions which are expected of all politicians. I mean, who expects that elected officials will have long conversations about “what-ifs” that at least sound a lot like discussions about corruption?

The arcane complexity of the legal charges is definitely a problem. It’s very much like the trouble that lay juries have in evaluating cases concerning complex and technical financial, technological or scientific evidence. We expect people to get an advanced specialized education and then get years of experience before making major decisions in technical fields, and yet we expect lay juries to choose between two dueling experts based on just a few days of exposure to the issues at hand.

However, corruption would seem to be fairly straightforward in most cases and wouldn’t require a lot of legal hair-splitting. Was the complexity of this case really the challenge here, or was it really a matter of a culture so broadly tolerant of corruption that only the most extreme and explicit acts of corruptions will draw legal censure? Was the complexity of the judge’s instructions itself a result of this culture?

Perhaps some readers from Illinois can pitch in with insight.

The Wage and Hour Division: We Can Help Prolong the Recession

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Since approximately day two of his administration, President Obama has boasted about what he has done since “day one.” Actually, day one was  relatively harmless. It was only a half day, and Obama spent it delivering another vapid speech, having a long lunch, and reviewing a boring parade. But on day ten, January 29, 2009, he began his project of giving employers additional reasons not to hire American workers. On that day he proudly signed the Lilly Ledbetter Fair Pay  Act, which allows employees more time to sue employers for alleged pay discrimination.

And from that beginning, the project of exacerbating unemployment and prolonging the recession has been carried out on a broad front of initiatives. The government has borrowed capital and diverted it to less productive uses under the guise of stimuli. Complex new mandates and penalties regarding employee health insurance have been imposed on employers. Further uncertainty has been created by  thousands of pages of impending financial legislation and rules and by the possibilities that new energy taxes will be imposed and that President Bush’s tax cuts will soon expire.

The Department of Labor’s Wage and Hour Division (WHD) has pitched in and done its part. Under the direction of Deputy Administrator Nancy J. Leppink, a stereotypically narrow and humorless bureaucrat, the WHD has taken an adversarial approach to employers. The  WHD has hired 250 field investigators to police employers and expects to hire 90 more with funds allocated in the Department of Labor’s fiscal year 2011 budget.   At a “stakeholder forum” in May, Leppink said she couldn’t understand why the WHD should, as it had in the past, give a break to employers who come forward and acknowledge past violations.

In March the WHD announced that it was ending its longstanding practice of issuing opinion letters responding to  questions  from employers about how labor laws apply to their situations. The questions frequently concerned whether a type of job would be classified as  exempt from the overtime requirements of the Fair Labor Standards Act (FLSA). Rather than responding in opinion letters to employers’ questions about their specific situations, the WHD now issues “administrator interpretations” setting forth general interpretations of laws and regulations. The WHD claims that issuing administrator interpretations instead of opinion letters “will be a much more efficient and productive use of resources,” but so far it has only issued three of them.

While the WHD has ended its service of providing employers with opinions on the classification of their employees, it is preparing to issue regulations requiring employers to render opinions on that subject to the WHD. Next month  a notice of proposed rulemaking is expected to be issued on  rules  under which”[a]ny employers that seek to exclude workers from the FLSA’s coverage will be required to perform a classification analysis, disclose that analysis to the worker, and retain that analysis to give to WHD enforcement personnel who might request it.”   This shift is consistent with the adversarial objective the WHD acknowledged in its Congressional Budget Justification: “WHD’s regulatory initiatives will be undertaken with an objective of determining where there are opportunities to shift the burden of compliance to the employer. . . .”

And so the businesses that  the administration would like to induce into hiring people become the enemy if they do. On the bright side, however,  the WHD has adopted a cheerful new slogan, “We Can Help.” They surely can, but if only they wouldn’t.

Fernandez: Nicely Put

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and, unfortunately, broadly applicable:

The most serious allegation in the whole affair is that the certain officials countenanced a crime because they wanted to. The most concentrated expression of tyranny is malice in the service of caprice.

Belmont Club