Today’s quote is dedicated to all the undergraduates who are contemplating law school:
I cannot understand how any gentleman can be willing to use his intellect for the propagation of untruth, and to be paid for so using it.
| –Anthony Trollope, Orley Farm |
Ouch!
But to pile on(?), let me quote my hero and brother in the bar(natch!):
— Thomas Babington Macaulay, Francis Bacon
Addendum as to why I nevertheless chose to become a lawyer, rather than an Economic Ph.D.: see http://specieaeternitatis.blogspot.com/2015/09/why-author-is-lawyer-not-economist.html
““Those who cannot remember the past are condemned to repeat it.”
My memory is not what it was.
Amazon? Some versions of Trollope’s “Belton Estate” that they’re selling are full of misprints.
I’d suggest the Project Gutenberg version, which also has Millais’ illustrations.
https://www.gutenberg.org/files/23000/23000-h/23000-h.htm
I wonder if it is true that undergrads see law as propagation of the truth. They, no doubt, learn early on that the court room is less a search for truth than an individualisation of the application of law. Similarly, in many fields of law, its application may be a search for truth (perhaps, for example, landlaw).
After reading Sub Specie’s path, the following question presents itself:
Who ppropagates worse untruth:
..A lawyer who uses anti-trust law to his client’s advantage, knowing the weakness of the economic foundation of these laws?
..An economist who is convinced of the absolute value of anti-trust law?
I have been looking for an excuse to leave this link. Now I have it.
https://twitter.com/RealPeerReview
Sub,
You had me at Angie Harmon.
@khodge:
Let me offer a limited, qualified defense of anti-trust law as it is (mostly) practiced in the US today. Antitrust law was not borne out of sensible economic consideration and over its first century it found so many clearly anti-economic applications that it is not surprising that much of it is not held in very high esteem by many sensible, market-friendly economists.
However, there is some good news about antitrust law. For several decades, many of the sound economic critiques of much of antitrust law have actually been taken aboard by lawyers and judges with some understanding of the subject. As a consequence, many of the worst antitrust doctrines either have been repealed by judges or have effectively been zombified, still in the precedents but practically toothless.
For example, one of the worst antitrust causes of action was “predatory pricing.” It is that point where antitrust law stops even pretending about favoring competition and becomes a form of mandatory cartel enforcement. And while SCOTUS did not go that far in Brooke Group Ltd. v. Brown & Williamson Tobacco Corp. (1993), it did the next best thing: it created such high barriers of proof, that I do not believe that there has been a single successful federal predatory-pricing suit since.
The one area in which antitrust law continues to have real teeth is in the rules against horizontal conspiracy (price-fixing, market-allocation) and mergers. Now, I’ll readily allow that there are strong normative and even economic/utilitarian arguments, against even this part of antitrust law. But surely critics of antitrust law in general must concede that of all parts of antitrust law, it is the one with the most plausible/least implausible economic foundations?
So, yes, I think an honest gentleman can be an antitrust lawyer today.
@Ken B. Just like the Law had me.
Can lobbies use laws to unlevel the playing field? Yes. Can this lead to cartels? Yes. Will simply ending the unleveling dissolve the cartel? Not necessarily. If law created the cartel can one justify using law to dissolve it? Yes. What is a name for such laws? Anti-trust.
@Ken B One wishes that the principal purpose of the Law’s interference with competition was to dissolve cartels.
In fact, the main purpose of most such laws, in particular state and municipal, is to create and protect cartels, old and new. From occupational licensing, to Certificate of Need laws, to numerical restrictions (like taxi medallions), to the grant of legal monopolies to alleged natural monopolies (like utilities), etc. All of this is done to create monopoly rents which the politicians can then turn around and tap (openly or secretly, by legal or illegal means) whenever they need some juice.
Could federal antitrust law stop this whole sordid enterprise? Sure, and–as written–most of these practices are illegal under the Sherman Act and subsequent statutes. Unfortunately, the Supreme Court has decided to read a textually-baseless state-action exemption into the antitrust law, so it keeps on.
Not that SCOTUS bears the principal blame here. When antitrust law threatened a huge, open and notorious price-fixing cartel–the agreement between most major universities to limit how much they’d be willing to offer in scholarships to particularly gifted students–Congress quickly stepped in and made sure that the Great and the Good would be able to continue to brazenly ignore antitrust law.
Sub,
I get confused so help me out. Occupational lincensing, cab medallions and the like establish cartels. Anti trust law could be used to break these cartels. The USSC has watered down the principal such anti-trust laws. Congress has not strengthened them. Therefore we should not have anti trust laws. I’m with you until that last bit.
@KenB. Sorry for being unclear. I guess that what happens when one writes on a subject on which one has mixed feelings. Let me summarize my views:
1. Antitrust law isn’t nearly as bad as it used to be from an economics perspective, thanks to a much needed injection of economics.
2. Much of the good that antitrust law could do is blocked by powerful political interests on all levels of governance.
3. Whether what remains (basically, horizontal conspiracy/anti-merger enforcement) is on net a good (compared to abolition of all antitrust laws) is a debatable subject, but on balance I tend towards yes.
Hi SSA,
I followed your blog, don’t know if that gives you my email.
As to anti-trust law, here’s two points of fact worth contemplating:
1. I believe that around the turn of the 19th/20th century, most consumer goods (from razor blades to chewing tobacco) were the subject of cartels or monopolies, resulting in little or no competition.
2. Without the Netscape/Microsoft anti-trust case, Google as we know it wouldn’t exist, everyone would have to use MSNsearch and we’d still be using Internet Explorer 6 (which didn’t even have tabs) because it would be the only browser that would run on any machine.
Microsoft actually shut down most of its browser development activities after it had killed Netscape. It took 6 years until the horrendously bad, buggy and unsafe IE 6 was replaced by IE7.
I doubt that Apple would exist, either. Microsoft would have bought them out early or perhaps entered into a deal with the major ISPs to prevent Apple devices from going on the internet.
This may sound extreme, but that kind of thing was standard procedure prior to anti-trust law.
The competitive markets people take for granted are artificial constructs created by anti-trust laws.
In the absence of anti-trust law and net neutrality, the internet, which can only be reached via ISPs which are natural monopolies/oligopolies, could never be the free market place for goods and information it is today.
@advo I don’t think it does. But have a look at the last two posts which were ultimately prompted by you. http://specieaeternitatis.blogspot.com/2016/08/errata-to-fortuitous-coincidences.html and http://specieaeternitatis.blogspot.com/2016/08/history-fda-and-cognitive-biases.html . You can send me an email from my blog, that’ll give me yours. Or just connect remove the spaces in my handle here (turning the ligature into two letters) and append “@gmail.com” to email me directly.
As to antitrust law, you may very well be right. I am not as confident as you are that cartels are sustainable absent legal support. Entry and defection are just too easy. But the history of that area offers plenty of support for both sides on this question.
@SSA:
In the absence of antitrust law, defections can be be prevented through contract. Just attach large penalties to any breach of the cartel agreement, or simply merge the competitors into a corporate group.
And entry in most industries is WAY more difficult than people imagine, especially if you don’t have things like “common carrier” rules in place for the various forms of infrastructure. See Standard Oil for details, and that was but one of many areas of the economy where competition had been largely eliminated.
For a modern example, just consider a cartel agreement between Microsoft and the ISP(s).
Impossible to break into.
You’d have to simultaneously create your own hardware, software and internet, without being able to provide your customers with access to existing content.
The taxi medallion example is interesting in today’s Uber environment. Apparently if you want to be “hailed” on the street, you have to have the medallion, but if you use an application like Uber, you are hiring a car, which falls under different laws.
The price of medallions is crashing. From O’Dwyers:
“New York City cab medallions, which sold for as much as $1 million a year ago, now are priced at the $500K level, battered by competition from Uber, Lyft.”
Taxis are hurting:
https://youtu.be/nMCUbN6DGwY