Category Archives: Law

An Antitrust Analogy

One of the biggest problems with antitrust regulation is that the statutes are so vague it can be difficult to tell what is legal and what isn’t. From p. 28 of Robert Bork’s 1978 book The Antitrust Paradox: A Policy at War with Itself:

To put the matter roughly, lawyers forming a partnership could lawfully agree on fields of exclusive specialization (which is market division) and the fees each should charge (price fixing), while the same lawyers, if they were not in a partnership, could not do these things lawfully.

The same logic applies to anything a company does in-house. Hiring an in-house accountant instead of using an outside firm is a form of vertical merger. So is hiring cleaning or cafeteria staff instead of using contractors. More than a century of case law has not settled the matter, at least for companies above a certain size (which also hasn’t been defined). The uncertainty can make companies hesitant to make efficiency-enhancing decisions that might benefit consumers.

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Lawyers Have Been Unpopular for a Long Time

From p. 1064, footnote 19 of Edward Gibbon’s Decline and Fall of the Roman Empire, the first volume of which was published in 1776:

The Germans, who exterminated Varus and his legions, had been particularly offended with the Roman laws and lawyers. One of the barbarians, after the effectual precautions of cutting out the tongue of an advocate and sewing up his mouth, observed with much satisfaction that the viper could no longer hiss.

17th Century Fart Jokes

A commentary on the rule of law from p. 95 of Nicholas Vincent’s Magna Carta: A Very Short Introduction:

Oliver Cromwell, chief architect of the most violent of the 17th-century revolutions, informed as Lord Protector that he was acting contrary to Magna Carta, is said to have replied that ‘their Magna Farta should not control [Cromwell’s] actions’.

The author also did an excellent podcast with Russ Roberts on EconTalk, which you can listen to here.

CEI Podcast for July 24, 2014: Victory in Halbig v. Burwell

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General Counsel Sam Kazman talks about what the Halbig decision means for the Affordable Care Act, as well as broader principles such as taxation without representation and the rule of law. Click here to listen.

CEI Podcast for July 1, 2014: John Holdren’s Poor Data Quality Control

General Counsel Sam Kazman talks about presidential science advisor John Holdren’s refusal to comply with the federal Data Quality Act when CEI questioned some discredited scientific statements in a video he put up on an official White House website. Click here to listen.

Suing the IRS – And Winning

Proving that sometimes good guys can win, our friends at the Institute for Justice are celebrating a big win against the IRS. In a move supported by large, established tax preparation firms, the IRS tried to require all tax preparers to get licenses. The licenses, along with other requirements such as annual continuing education courses, would raise costs for smaller firms and put many individual preparers out of business entirely; one sees why large firms would welcome the extra burden. They would face less competition. IJ sued to put a stop to his perfidy and preserve a more open competitive process.

A few years ago, before IJ filed its lawsuit, now-CEI Adjunct Scholar Caleb Brown and I co-authored an op-ed warning why mandatory tax preparer licenses are a bad idea:

Since the IRS has the power to revoke registrations, tax preparers will have to be careful not to advocate too aggressively for their clients. Besides this chilling effect, mandatory registration reduces consumer choice.

There are at least 600,000 unregistered preparers. Many of them are retirees. Others have jobs, but prepare taxes on the side to help make ends meet. Still others are volunteers. They give their services for free to people who can’t afford a tax preparer. How many will give up, rather than jump through the proposed regulatory hoops?

The IRS estimates the total cost of the new regulations at $48.5 million, plus 1.71 million hours of paperwork and record-keeping burdens. That’s equivalent to 855 full-time jobs — and not the kind that will spark an economic recovery.

Read the whole piece here. Read more about IJ’s victory here, and see a short video they produced about the case here.

CEI Podcast for October 30, 2013: Bringing Transparency to the Consumer Financial Protection Bureau

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Have a listen here.

George Mason University law professor and Mercatus Center senior scholar Todd Zywicki discusses his paper, “The Consumer Financial Protection Bureau: Savior or Menace?” His thesis is that this “independent agency inside another independent agency, presided over by a single director who is insulated from presidential removal,” which is also immune to Congress’ power of the purse, is a return to a Nixon-era approach to agency structure. He gives several recommendations for improving actual consumer protection.