I try to be an optimistic fellow, but there is one area where the erosion of civil liberty has been so severe even I approach despair. That area is the Rule of Law.
The Rule of Law
The Rule of Law is a key institution of Western civilization. It encompasses ideas, dating back to ancient Greece and Rome, that laws ought to be negative (i.e., tell us what we should not do, rather than what we are allowed to do), general, unchanging, and enforced equally on all citizens. Implicit in the Rule of Law is an endorsement of individual liberty and limits on arbitrary government power.
The Declaration of Independence’s opening words are an expression of the Rule of Law: “[A]ll men are created equal, that they are endowed by their Creator with certain unalienable rights, that among these are Life, Liberty, and the Pursuit of Happiness.” The Rule of Law is enshrined in the Fifth Amendment of the U.S. Constitution, which provides “no person shall be … deprived of life, liberty, or property, without due process of law; nor shall private property be taken for public use without just compensation.”
The Rule of Law is of profound value to all of us. Yet most of us fail to raise a finger against those who are waging flat-out war against its very foundations. The assault comes from four directions.
Lawsuit Abuse
By now the pattern is all too familiar. Trial lawyers target an unpopular product or industry (silicone breast implants, asbestos, tobacco, guns, lead-based paint, etc.) and finance self-described public interest groups to demonize the target. Lawsuits are filed claiming damages in the tens or hundreds of billions of dollars. Compliant judges allow the suits to move forward, and gullible juries approve enormous awards. The lawyers pocket billions of dollars in “contingency fees” and plow some of it back into the next round of litigation.
There is blame enough to fill everyone’s pockets. Jurors ignore the contributory negligence of so-called victims and compelling evidence that harms are grossly exaggerated. Businesses settle too quickly and agree to terms that fill the coffers of the trial lawyers. The media fail to criticize juries for approving billion-dollar judgements. Business groups fail to educate jurors about the consequences of their decisions.
The abuse of class-action lawsuits has led to the bankruptcy of scores of companies only remotely associated with silicone, asbestos, and lead, costing many thousands of workers their jobs and robbing investors of billions of dollars. The cost of all forms of tort litigation in 1991 totaled $131 billion, or $1,200 per individual and nearly $5,000 for a family of four. Costs have undoubtedly gone up since then, with class-action judgments dwarfing all other types.
You and I pay a “tort tax” every time we buy a product that has ever, or might ever, hurt anybody dumb enough or careless enough to misuse it. A hefty part of that tax goes to trial lawyers, a perverse kind of income redistribution scheme that threatens to unhinge the nation’s political and legal systems.
Antitrust Laws
Antitrust laws violate the Rule of Law three ways. They are not negative: They do not tell companies to refrain from committing acts clearly defined as illegal, but rather allow regulators (typically lawyers) to tell companies what to do.
Under antitrust law, government confiscates the assets of one company for redistribution to its competitors in the name of benefitting consumers. But consumers have no right to a company’s private assets, and regulators have no special insight into what consumers want. This is just bad law.
Antitrust laws apply retroactively to conduct that was legal at the time it occurred. Conduct that would be legal for a non-monopolist, such as offering special discounts to vendors in exchange for promotional consideration, is illegal for a monopolist. Since the finding that a company is a monopolist is often made after the fact (in Microsoft’s case, some five years after the alleged fact), antitrust law is a species of unjust ex post facto law, which the founding fathers wisely forbade in Article I, Section 10 of the Constitution.
Antitrust law is enforced arbitrarily. Historically, antitrust suits have been filed against industries that are lowering prices and increasing output, just the opposite of what monopolists are thought to do. Most complaints are not filed by public interest groups, but by less-efficient competitors of industry-leading companies. Typically, when complaints are filed and legal action announced, the stock prices of those rivals increase, demonstrating that investors expect the profits of the rivals to increase after the industry leader has been legally handicapped. How could this benefit consumers?
We all have an enormous stake in the abuse of antitrust laws. For example, antitrust law delays promising mergers—at a cost of over $12 billion a year. Splitting up Microsoft would cost consumers hundreds of billions of dollars, and preventing the proposed EchoStar/DirecTV merger would deny satellite service to tens of millions of rural households.
Return of Feudalism
A man’s house used to be his castle, but oh how times have changed. Today, regulators from scores of government agencies assert they have the authority to determine everything from the width of the doorways and height of electric outlets and light switches (under the Americans with Disabilities Act) to the number of bedrooms, exterior doors, and occupants.
In suburban Chicago, regulators want to require sprinkler systems in new homes. A state legislator wants to require landowners to pay a $1,000 fee and create or restore at least 1.5 acres of wetlands for every acre of wetland developed. In return for permission to build or renovate an existing structure, regulators demand public access and “impact fees” bearing little or no relation to the cost of infrastructure the landowner might someday use.
These rules assume someone other than the individual landowner actually “owns” the property and therefore has the right to decide how to use it. There is a name for this doctrine of “social” property rights: feudalism. It prevailed in Europe for many centuries, discouraging trade and commerce and elevating privilege over individual freedom. It was finally overthrown in the seventeenth century by the doctrine of natural rights, which held that private property is so important to individual liberty it must remain outside the control of the state.
Private property is essential to the Rule of Law. In all of human history, and in all the countries of the world today, there is no Rule of Law without protection of private property. And yet this keystone of civil liberty is being washed away at an alarming rate with hardly a voice raised in alarm, much less opposition.
Asset Forfeiture
A few years ago, Michigan police arrested a man for soliciting a prostitute and confiscated the car he was driving at the time. The man’s wife, co-owner of the car, protested she knew nothing of her husband’s bad conduct and demanded compensation for her property loss. The case went all the way to the U.S. Supreme Court, which ruled “an owner’s interest in property may be forfeited by reason of the use to which the property is put even though the owner did not know that it was put to such use.”
It is difficult to imagine a bigger hole blown into the edifice of private property and the Rule of Law than asset forfeiture laws. They put at risk literally everything you own that might somehow “facilitate” a crime or be alleged to represent the proceeds of a crime committed not only by you, but by your spouse, children, relatives, or even guests. Your property can be taken before you or the other party is convicted of a crime. It can be kept by the police even if you or the other party are eventually exonerated.
Do you know anyone who smokes marijuana? Have they ever been a passenger in your car or guest in your home? A single marijuana “butt” in an ashtray could cost you your car or your home. So could a single illegal pill or capsule.
Between 1985 and 1993, approximately $4 billion in assets were seized by federal, state, and local authorities. The federal government alone carried out 170,000 seizures during that time. I’m trying not to exaggerate the threat, but you have to be blind not to see how dangerous this law is to civil liberty.
Conclusion
Lawsuit abuse, antitrust laws, the return of feudalism, and asset forfeiture represent four deadly threats to the Rule of Law. How often have you seen this threat to our liberty reported in your daily newspaper or a weekly newsmagazine? How many people do you know who would identify any of the four as a threat to their freedom?
We’ve already lost much of what the founding fathers fought and died to give us. How much more can we afford to lose before the amazing experiment in liberty that we call the United States simply ceases to exist?
