Cliff Winston has written a lengthy response to my critique of his views on judges and justices. It came on July 4 but I was busy, as Bob Cratchit said to Ebenezer Scrooge, “making rather merry” yesterday. I marched in the local July 4 parade and our group carried Betsy Ross flags and a Libertarians for Peace banner.

Thinking through Cliff’s response and replying to much of it will take time. So, for now I’m going to do what Bryan Caplan often did when someone had a lengthy response: print it in whole and respond later.

Cliff’s response is titled “The Supreme Court and Government Failure.”

Here it is:

The intent of my comments was to motivate assessing Supreme Court Justices and their rulings in the same way that we assess other policymakers and their policies.  Assessment of the latter often leads to findings of government failure.  I have not seen SCOTUS assessed in this manner and I acknowledge the topic still requires more thought and discussion about the methodological issues involved.

To the best of my knowledge, economists have not reached a consensus on defining government failure.  A plausible definition of a government failure, which is useful for my purposes because it lends itself to empirical measurement and does not limit its scope, is a policy intervention that significantly wastes resources.  Those resources include firms’ compliance costs and the cost of taxpayers’ funds to pay for government’s implementation and enforcement of the policy.

Economists tend to think of government failure as applying to elected officials in the legislative and executive branches who formulate and implement public policies at various levels of government.  I have synthesized many studies (see the following books free and free in certain cases) that have assessed the effects of those policies and found enormous evidence of government failure. Such studies have been useful for policy debates. For example, evidence on the effects of Civil Aeronautics Board regulation of airline fares on interstate routes that found those regulated fares were higher than comparable unregulated routes in California and Texas supported the case for deregulating the airline industry to correct government’s regulatory failure.

Although economic efficiency is important for policymaking, there are far more counterexamples to the airline case.  For these, empirical evidence identifies a government failure that supports an efficient policy reform, but policymakers are unwilling to consider that reform.  For example, agricultural subsidies to farmers and Agri-business are hard to justify on economic grounds and urban rail transit’s social benefits are exceeded by its huge subsidies, yet money continues to be funneled into those enterprises. Apparently, there is something more important than efficiency that enables those subsidies to grow.  That “something” causes government failure and impedes any efforts to reform policy to significantly reduce that failure.  It is certainly possible to speculate on what that “something” is, but I don’t know of any causal evidence to support such speculations.

Of course, elected officials and their surrogates are not the only people in government who make policy.  Judges and Justices also make policy.  For example, policy toward abortion over the last fifty years was not the result of an act passed by Congress and signed by the President. The nation’s abortion policy was shaped first by the Supreme Court’s decision on Roe v. Wade and more recently by the Dobbs decision.  Similarly, affirmative action policies by public and private colleges and universities will have to conform to the Supreme Court’s recent decision to undo the Bakke decision.

Thus, in the context of government failure, how should we assess SCOTUS decisions and determine if they are likely to result in government failure?  How can we reduce the chance that the decisions are likely to result in government failure?  Two immediate objections to this exercise are that SCOTUS is supposed to be narrowly constitutional providing a check within the structure of governance, and that SCOTUS makes legal not economic decisions.  In other words, it is inappropriate to assess SCOTUS rulings as possibly failing like we have assessed other government policy failures.

However, I agree with Richard Posner’s perspective that a case is just a policy (my insert) dispute, which opens up the playing field to assessing the case by cost-benefit analysis and by other empirical approaches that are commonly used to assess government policies. To be sure, Justices are not trained in economics, but does that mean economics should be ignored in assessing their decisions, especially if it could identify a more socially desirable resolution of a policy dispute?  Economic efficiency considerations are not ignored in assessments of other government policies; what makes assessments of the public policies facing SCOTUS different?

If the constitution gave unambiguous guidance that was aligned with socially desirable outcomes, then it would be dispositive.  However, the constitution is not always unambiguous; Justices interpret it in different ways and have increasingly done so in accordance with their ideologies (see chapter 7 free in certain cases for empirical evidence); and the Constitution, just like transit operations, has not kept pace with changing demographics and other societal changes.

Unlike other areas of economic policy, there is not accumulated evidence that SCOTUS rulings have added to government failures.  As noted, I have not seen SCOTUS rulings assessed using that benchmark. One might speculate that because elected officials’ policies fail so often, when SCOTUS has a case involving the government, it is likely to reduce a government failure.

In any case, my view is that empirical economic analysis could and should be used to help reduce the chance that SCOTUS decisions will result in government failure.  As noted, Justices are not trained in economics or empirical methods, so expert panels could and should be formed to help Justices to reach more informed decisions. The paper I sent to David raises and responds to several objections to expert panels: (1) Economists also are ideological; (2) Economist and non-economist experts may disagree; (3) Experts can submit amicus curiae briefs; (4) Expert panels are inconsistent with the role of the Supreme Court; (5) The Supreme Court makes legal not economic decisions; (6) The legislative branch should convene expert panels; (7) Lawyers control the evidentiary process; (8) Expert panels would amount to academic seminars; and (9) Other reforms of the Supreme Court are available.

Assuming expert panels were advising the Supreme Court and the Justices respected their insights and took their advice seriously, could those panels bring evidence to a case that might affect the Justices’ thinking and understanding of arguments and amicus briefs so as to reduce the likelihood of government failure? Let me first add that the cause of government failure is probably better understood in polices that arise from Supreme Court cases than from policies instituted by elected officials.  That is, I do not have evidence that explains why policymakers assign a large welfare weight to farmers and transit operators, but I do have evidence suggesting that some Justices’ ideologies could enable them to justify assigning a dispositive welfare weight to a woman who does not want to provide her services to a gay couple, or providing a higher welfare weight to a pregnancy than to the fate of that baby post-birth.

That said, in the web designer case, the expert panel would stress the economic costs to all the parties involved, the non-economic benefits to the web designer, the bargaining issues involved, and consider any spillover effects of either allowing or disallowing the web designer’s discrimination.  This is not a straightforward exercise, and it could reveal some important effects. In the final analysis, I don’t know where the assessment would land, but I think it could clarify the relevant welfare effects of the policy dispute and the most desirable resolution and scope of application for the decision among a set of options (e.g., subcontracting the web design or cake, what types of services constitute speech, and which don’t).

In the Dobbs case, it would have been useful for Justices to hear from an expert panel that attempts to resolve a variety of relevant issues, many of which can and have been addressed empirically, such as: (1) the effect of abortion access on women’s lives and health; (2) risks to women who cannot get timely and appropriate healthcare in case of urgent medical issues like miscarriages or ectopic pregnancy; and (3) risks to women due to confusion and legal doubt among health care providers after Dobbs.  The expert panel also could provide insights on the difficult problems of assessing the effects of abortion on the unborn child as well as the fates of children resulting from un-terminated pregnancies after Dobbs.

Finally, the education loans and college admissions cases are ripe for an expert panel’s empirical analyses of the effects of those policies and assessments of alternative policies that might be more socially desirable.

In sum, my view is that the Supreme Court is making public policies, which like other policies have economic and non-economic effects; thus, Justices should have the benefit of assessments by experts of those possible effects, which may reduce the chances that the justices’ rulings result in government failure.

David’s objections to my initial email and my responses are as follows:

▪ I leave out the possibility of looking at the Constitution, seeing what it says, and judging accordingly.  My response: I indicate my reasons above that relying on the Constitution alone is not necessarily going to lead to desirable outcomes.  In particular, I agree with Posner’s 1987 article that “law is not a self-contained field of knowledge whose methods of reasoning can by themselves solve human problems in ways that best serve our society.” Expert panels are not necessarily appropriate for every case before SCOTUS, but I think Justices often could benefit from more effective help by experts. In cases where the Constitution is explicitly silent or ambiguous on the matter, neither determining judicial intent nor ascertaining original meaning is an exact science that must be practiced only by Justices.

▪ On the web designer case, although I say that the economic benefits of greater output should be compared with the costs of not allowing the web designer to exercise her religious preferences, that, in theory, is what the web designer is doing. Accordingly, we don’t need a government agency, whether a court or a regulatory agency, to make that assessment. If a government agency were to require her to trade, we know that there would be net losses: the loss to her from being forced to trade would be greater than the gain to the consumers who miss out on the trade. If that weren’t so, they could raise their offer and she would accept.

My response: The argument is that there is no price that could result in a mutually beneficial trade because of the infinite loss to the web designer, so any ruling by SCOTUS that dictates otherwise would produce a net welfare loss and there is no need for the court to get any advice.  That is certainly true if the web designer requires an infinite price.  But my understanding is that the case was brought without an actual gay couple wanting the designers’ services. I therefore have no idea what tradeoffs the web designer made with an imagined consumer and consumer base.  In any case, the role of the expert panel would be to guide the Justices about what we know about dispute resolution when the participants are extremely far apart. I would be more comfortable with the Justices’ ruling if they concluded, based on the insights of the expert panel, that the dispute could never be resolved more constructively after considering a plausible set of options instead of relying solely on their subjective interpretation of the constitution.  It is important to be right for the right reasons.  At this point in the debate about SCOTUS decisions, both sides are content to be right for the wrong or at least highly questionable reasons.

▪ Generally, policies with the primary intent of redistributing income instead of improving efficiency are taken by economists as given, meaning democracies support them or reject them at the ballot box.  Economists assess those policies from an efficiency perspective on whether they are least cost solutions to achieving the social goals they are trying to achieve by redistributing income.  So, on the education loans and college admissions cases, I agree that Biden has not subjected his education loan policy to the ballot box, but that policy would influence voters’ preferences for or against him if it were maintained. In any case, I speculated on what the motivation is for Biden’s and the universities’ polices because I didn’t see a market failure. So, the economic issues are what are the least cost ways of achieving the policies’ goals? To that end, I think an expert panel would provide useful information on what we know about the effects of suspending the education loans and of admissions policies that favor certain applicants based on their race and ethnicity.  Again, the objective is to be right for the right reasons.

Bottom line: I certainly don’t want judges and Justices to be central planners.  However, they are policymakers who can advance policies that fail, just like other policymakers’ policies have often failed. Just like I wish other policymakers were better informed about the effects of their policies before they enacted them and learned from their mistakes, I wish Justices were better informed about the effects of their de-facto policies and learned from their mistakes. I don’t know if any of the recent rulings by the Justices will be assessed retrospectively as government failures. However, the Justices’ siloed approach to policymaking strikes me as likely to result in government failures.

I probably don’t need to tell commenters that they should feel free to comment on Cliff’s points before I get around to doing so. But I will do so in the next day or two. It might not be totally comprehensive but I won’t cherry pick either. I guarantee, though, that I will show why he’s wrong about the web designer.