19 April 2017

Taxes and Tax Policy

Professor Donald Roth, who teaches at my undergraduate alma mater, Dordt College, has posted a three part series on tax policy here, here, and here. Donald has his LL.M. in tax from Georgetown and knows whereof he speaks.

In addition to writing clearly and simply, Don doesn't argue that there is a distinctively "Christian" position on tax policy. He's content to explain how we (in the U.S., with a few nods to the European tax scene) got where we are and what changes might be in the offing.

31 March 2017

"The Lion in the Living Room"

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Subtitled, "How Cats Tamed Us and Took Over the World" by Abigail Tucker (a/k/a Mrs. Ross Douthat). You can get a brief sense of Tucker's insights on how cats domesticated themselves in a short piece she wrote in the New York Times for my birthday here.

Unlike other domesticated animals like dogs and horses, domestic cats are little changed from their pre-domesticated ancestors. Just why humans allowed cats into their lives is a bit of a mystery; after all, despite their reputations at hunters of vermin, cats--unlike dogs and horses--are virtually useless. Cats do kill many songbirds and have wrought havoc with wildlife indigenous to Australia: "Australian scientists recently described stray cats as a bigger menace to the continent's mammals than global warming or habitat loss."

Cats may even be a threat to humans: "Toxoplasma gondii, a mysterious microorganism, is spread by felines and is by now believed to inhabit the brains of one in three people worldwide, including 60 million Americans." When found in its prey, Toxoplasma makes them unafraid of cats. Which is not a good thing when you're a mouse.

Nothing untoward seems to affect human hosts but its initial effects in preborn humans explains why pregnant women are warning against emptying cat pans:
In 1938, pathologists at Babies Hospital in New York City  ... diagnosed the congenital form of Toxoplasma, which is passed from cat to pregnant human to unborn baby, causing spontaneous abortions, stillbirths, and severe complications like blindness and mental retardation.
Of course, none of these drawbacks have slowed the explosion in cat ownership by humans (or human adoption by cats, right, Rachel?). Limited by her professional commitment to methodological naturalism, Tucker spends pages explaining why our love of cats defies evolutionary logic. Not that I can explain it, either, except that I feel no compulsion to explain everything in terms of a biological imperative.

Lest my comments suggest that I didn't enjoy reading "The Lion in the Living Room," let me be clear: I did. Tucker knows her stuff, did her work, and writes well. Thanks, Lisa and Attilio, for this gift.

21 March 2017

HH Gregg and Contemporary Bankruptcy

You can go here to read about the hiccup in the Chapter 11 bankruptcy of HH Gregg. The retailer, which filed for bankruptcy relief late on March 6 (read my pre-bankruptcy observation here), does not plan to reorganize as that term was understood through the end of the 20th century. Instead, like the first go-round of Family Christian Stores (beginning here and end here), HH Gregg planned to use the structure of Chapter 11 to get out of the leases at its underperforming stores, sell its assets to another entity, and use the proceeds of the sale to pay its secured creditors leaving a few pennies on the dollar for everyone else.

Well, that is, until the unnamed buyer backed out.

Gregg's management still believes it can sell itself as a going concern and they may be right. Or not. The current liquidation of Family Christian Stores after its sale-through-bankruptcy in 2015 stands as a cautionary tale for anyone even remotely thinking of getting into the brick-and-mortar retail business.

Some folks have raised the question of whether a government-funded Chapter 11 system should be available to companies who do not intend to reorganize. After all, the thinking goes, the bankruptcy system exists for the benefit of all stakeholders, not a few select creditors. When stakeholders such as employees, local governments, and unsecured creditors get little or nothing, what public good does Chapter 11 serve?

I am not among the the sale-through-bankruptcy naysayers. The current truncated Chapter 11 process is imply another step in the increasing efficiency of market capitalism. While one might question whether efficiency should be as important as it has become, there is no a priori reason why the government should not provide a legal forum to enhance the efficient redistribution of assets. Rather, the reason not to increase efficiency is when it would otherwise be unjust, and I can't see anything unjust about sales-through-bankruptcy.

20 March 2017

"The Underground Railroad"

I was about to give up on reading Colson Whitehead's "The Underground Railroad" at the end of its third chapter. Sure, the book had Oprah Winfrey's imprimatur and it was by my lights clearly and powerfully written. Yet Whitehead's unrelenting and powerful description of the worst of slave life on a plantation on the coast of Georgia wore me down. Whitehead was so good I didn't want to read any more of his book.
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The underground railroad came just in time. I had known of Whitehead's conceit--a real, physical underground railroad--but it took me another several chapters to understand how it worked. "The Underground Railroad" is neither science fiction nor magical realism. Thank goodness. The physical underground railroad is a time-saving device and the states to which it took protagonist Cora (South Carolina, North Carolina, Tennessee, and Indiana) are tropes for the various (and unpleasant) experiences of Africans in America. Whether brutalized or sterilized, in hiding, escaping, or seemingly free, the fate of even the strongest-willed of escaped slaves like Cora was never safe from the depredations of American race-based slavery.

"The Underground Railroad" does not end happily. Whitehead has Cora yet again on the run and the reader is left uncertain whether she will every find the freedom and opportunity for self-determination she demands. "Live free or die" could be Cora's motto as well as New Hampshire's. And, by extension, the motto for all African-Americans.

"The Underground Railroad" and its author deserve their awards While I can recommend it with the proviso that it's not for the faint of heart, I still strongly commend it to my readers' attention.

06 March 2017

The End of the Line ... for RadioShack and HH Gregg

Following last week's post about the demise of Family Christian Stores here, I want to give equal time to the near-end of the line for two additional, venerable retailers.  Go here to read about the situation of RadioShack (which only two years ago went through a Chapter 11 in the now-dashed hope of surviving as a smaller, "leaner" business) and here to read about the impending Chapter 11 of HH Gregg (which likewise is premised on the hope that a smaller version of itself will succeed).

Joseph Schumpeter coined the phrase "creative destruction" to describe the inevitable effects of a market economy. Older means of production (and their producers) are quickly replaced with newer, more efficient ones. While satisfying more needs of more people, the industrial-market stage of capitalism disrupted the lives of many others. Charles Sellers describes the initial overthrow of traditional life in America through the course of the 1820's in "The Market Revolution." Michael Sandel describes how Americans reluctantly came to grips (or failed to do so) with the market economy over the  next century in "Democracy's Discontent."

In one sense, what is happening with Family Christian Stores, RadioShack, and HH Gregg is simply the latest chapter in the process of ever-increasing efficiency. From another, deeper perspective the increasing speed of the destruction wrought by late-market capitalism (which no longer meets but instead creates human "needs") reveals the increasing level of dislocation of American society.

While I've posted on the importance of associational forms of life to a flourishing society here, here, and here, this time I want to direct my readers' attentions to an interesting piece by Adam Sandel here. Author of "The Place for Prejudice: A Case for Reasoning Within the World," Sandel's post linked above starts with a series of questions:
What is the place of work in a good life? And how should a society honor work? Neither party has been able to offer a compelling answer to these questions, or even to raise them. Their failure to do so has contributed to working-class support for Trump. The anger with establishment politics that Trump seized upon is not only about job insecurity but a growing sense that traditional blue-collar work is no longer honored as it used to be.
Why does blue-collar (and, I should add, most white-collar work including the practice of law) fail to satisfy? Because purely self-directed work, without a place of respite, renders all of life an unremitting source of competitive uncertainty.

What's missing from the contemporary picture of the unsatisfying life? According to Sandel, the place of the family: "The family and civil society ... form a pair. Unconditional family love and civil recognition based on merit; immediate family unity and individual self-expression in society. [Y]ou cannot fully enjoy one without the other."

Reading all of Sandel's post will reward the effort.

None of my comments on Sandel should be taken to suggest that the doors to Family Christian Stores, RadioShack, or HH Gregg should remain open. As businesses that have adopted the artifice of the corporate form, they have chosen to operate in calculating and unforgiving world of the market. Creatively destructive compentitors and forms of business have eliminated the space for these brick-and-mortar retailers. No tears need be shed for their demise.

Yet for all out hardened sensibilities about the modern form of market life, we must remember and enhance the important forms of non-market life starting with the family.

02 March 2017

"Natural Law in Court"

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I'm looking forward to meeting up again with Richard Helmholz, author of "Natural Law in Court: A History of Legal Theory in Practice" (2015), at the Religious Critiques of Law conference at Pepperdine University School of Law.

"Natural Law in Court" has been reviewed here and here. The purpose of this post is to let even more folks, particularly lawyers, know about this splendid (and relatively brief) work.

Helmholz set out to answer a basic question: for all the philosophical and theological to-do about natural law, did it ever actually make an impact on the ground, i.e., in court? Helmholz thus surveyed the legal literature of three legal communities over the course of roughly 300 years. The communities were Continental Europe, England, and the United States. The period examined begins with 1500 and ends around 1800 for the first two communities and in the late 19th century for the U.S.

His conclusions?
This survey of the relevant evidence ... proves that natural law was carried into practice in the courts of each of the three geographical areas surveyed. ... At least six specific conclusions about its use emerge from a consideration of the evidence.
First, in all three geographical area surveyed, future lawyers learned something about the basic characteristics of the law of nature as part of their early training. ...
Second, once launched in their careers, some lawyers brought what they had learned about the law of nature into their professional lives. They used it. ...
Third, the law of nature was a common possession of lawyers in the world of Western jurisprudence. ... This consistency [across legal communities and through time] is remarkable ...
Fourth, in actual cases the law of nature was almost always treated as a source of positive law, not as a rival or alternative to it. ... The fact that an institution was contrary to the law of nature did not in itself make the institution unlawful. ...
Fifth, throughout its history, the law of nature has been a modest force for good. ... It was not a cure-all, but it did promote the cause of justice. It helped cement principles of right and wrong in the minds of lawyers and consequently in the decisions made in courts of law. ... Natural law served as a useful vehicle in securing many results we now regard as self-evident.
Sixth, the history of natural law's use in courts does suggest that it would be a mistake to claim too much for it. ... 
Not nothing but not everything or even as much as might be hoped-for characterized the history of natural law in important Western legal systems. Justice is a virtue but so is modesty about justice.

PACA-ing It In

Warning: Inside legal agribusiness baseball.

Nearly 20 years ago the California Bankruptcy Court Reporter published a short piece I wrote titled The Perishable Agricultural Commodities Act and the Bankruptcy Code: A Trap for the Unwary. You can download it here if you're interested.

PACA, the acronym for the Act, is evidence of the continuing infatuation of Americans (and their representatives in Congress) with the virtuous yeoman farmer of yesteryear. No matter that farming today is a fully integrated corporate enterprise that bears almost no relationship to what most Americans imagine, farmers are the beneficiaries of much federal largesse. (For a summary of Wendell Berry's thoughts about the current state of American agribusiness go here. For some of mine go here and here.)

PACA permits unpaid farmer-sellers of perishable agricultural products, typically fruits, to get their money from their buyers ahead of virtually all other unpaid creditors. Now, I'm all in favor of folks getting what's owed them but why should sophisticated corporate farmers get paid ahead of everyone else? What about employees of a now-defunct buyer? What about all the other creditors who are getting stiffed? What about the buyer's bank?

Well, okay, no one much cares about the bank of the defaulting buyer of perishable agricultural commodities but such were my clients in an earlier life. Even if there is little sympathy for the lending industry it strikes me as simply another example of political rent-seeking to prefer farmers to banks that have followed state law to get a perfected security interest in the defunct buyer's assets.

All of which is to get to the latest foray of the courts into the battle between farmers and banks over the reach of PACA. You can go here to read an opinion of the federal Ninth Circuit Court of Appeals in which two judges asked the full court to review an earlier decision giving banks a work-around with respect to PACA. If you'd rather not wade through the full opinion you can read Bill Rochelle's summary here.

For what it's worth, I think the Ninth Circuit's earlier decision was wrong and that as a matter of statutory interpretation the farmers in this case should have prevailed over the lender. As a matter of principle, however, whether PACA was needed in the 1930's, it's no longer needed today. But I'm not holding my breath to see if the Republicans in Congress or the White House will take the opportunity to let the market rule in this aspect of the economy.

28 February 2017

Renew Conference 2017: Final Installment

This past Saturday I posted here about the Renew Conference 2017 remarks of keynote speaker Vincent Bacote. A few concluding thoughts. After pointing out the shortcomings endemic to White, conservative Evangelicalism, Bacote spoke briefly but critically about two current approaches to Evangelical political and social action.

Seven years ago, University of Virginia sociologist James Davison Hunter published "To Change the World: The Irony, Tragedy, and Possibility of Christianity in the Late Modern World" in which he urged Christians to engage in "faithful presence." In Hunter's vision, serious Christians will not physically withdraw from current American society but will occupy their remaining cultural space in an Anabaptist-like way. Their ongoing and increasingly countercultural presence will hold up to the contemporary hyper-commodified and hyper-sexualized world an alternative mode of existence, one that in the long run will prove increasingly attractive as the idols of more stuff and more sex ultimately prove less and less satisfying.

More recently, Rod Dreher has been pressing toward the so-called "Benedict Option" named in honor of the sixth century monk St. Benedict who established monastic communities in the Western portion of the crumbling Roman Empire. It was at these monasteries that the literary deposit of the dying Classical and Roman Christian ages were stored while waiting for their recovery in the Renaissance of the eleventh century. Dreher's approach (read a FAQ here) is quite similar to Hunter's but bears the fruit of much thinking about such matters over the past decade. (Go here to see an up-to-date argument about one aspect of the debate about the BenOp.)

In any event, both faithful presence and the BenOp are grounded in the development of intentional and "thick" communities by Christians. Where do these communities then go? Other than nurturing the next generation, what will they do? According to Bacote, not much. In his words, serious catechesis of Christian communities* is a necessary but not a sufficient condition for to bear the Christian witness to a dying world. Some sort of more active engagement is appropriate and necessary, he believes

Just what sort of active engagement does Bacote have in mind? Regrettably, he didn't have time to address the positive aspect of his social and cultural proposals but I suspect we'd find them in his book, "The Political Disciple: A Theology of Public Life" (2015). 

I've not read Bacote's book but I have ordered it. It's about fourth on my reading list so you'll have to wait awhile for my thoughts. Until then, why not read it for yourself?

* Serious catechesis? By Evangelicals? Seriously?

26 February 2017

Family Christian Stores Bites the Dust

I had wondered here back in 2015 if the Chapter 11 bankruptcy reorganization of Family Christian Stores would do anything more than delay the inevitable. Well, it didn't. Go here to read a piece in Christianity Today about the shuttering of all of the remaining stores.

Even giving the reorganized Family Christian Stores a pass on paying much of its debt was not enough to permit this purveyor of Christian books and trinkets to stay afloat in the brave new world of retailing. Bigger players than Family Christian Stores are no longer able to operate in the world of internet shopping. (A word to the wise: according to Bloomberg you expect to see HH Gregg in a Chapter 11 next month.)

The Chapter 11 of Family Christian Stores was a treasure trove of legal arcana for a professor of bankruptcy law. (Go here, here, and here for some of my favorite inside-bankruptcy examples.) But even more important to the failure of this venerable chain of stores than the juggernaut of amazon.com are the buying habits of American Evangelicals. Mistaking self-help books for Christian theology and that buying knick-knacks is the same as Christian piety, Evangelicals have themselves to blame for the demise of what could have been an important resource for building the Evangelical mind and life.

Except there is no Evangelical mind or distinctly Evangelical form of life. Which is why I continue to believe the term "Evangelical" should be retired.

25 February 2017

Renew Conference 2017: First Installment

Every so often Westminster Reformed Presbyterian Church hosts what it calls a Renew Conference. You can read my concluding posts from the 2010 and 2012 conferences here and here. For 2017 Vincent Bacote of Wheaton College was the keynote speaker on the theme "The Sky Isn't Falling But the Door Is Opening."

Bacote's initial address on Friday evening was a brief history of American Evangelicalism beginning with the publication of "The Fundamentals" (1910-1915) and continuing to the present day. His comments on the pre-1970 era were a riff on George Marsden's "Fundamentalism and American Culture." His remarks on the recent Evangelical past were more interesting: Evangelicals' infatuation with Ronald Reagan and George W. Bush, their subsequent "burnout", and their increasing levels of fear during the Obama administration. This pattern of reactive short term-ism demonstrate that Evangelicals are typically American, that is, they don't want to think too hard about really difficult matters of public policy and they want solutions to perceived problems now! In response to my question, however, Bacote isn't ready to ditch the label "Evangelical." You can go here to read why I think "Evangelical" is past its sell-by date.

In his Saturday morning address Bacote spoke to the topic of race in America. He had hinted at this aspect of American life the previous evening in his observation that self-identified Evangelicals are overwhelmingly White. In brief, while the concept of race is an eighteenth-century Enlightenment concept, it nonetheless operated and continues to operate with the force of reality. In other words, the social and economic effects of 200+ years of slavery followed by 70+ years of Jim Crow on Black Americans didn't disappear with the Civil Rights Act of 1964 and the Voting Rights Act of 1965. Even on a worldwide basis, Bacote observed, 500 years of political, military, and scientific successes of the northern European and American peoples has lead to the idolization of "Whiteness" exemplified in the use of skin-lightening creams and injections by the dark-skinned peoples of South Asia and even Africa. On the individual level, the response of Evangelicals should not be to opt-out of the hard work of the personal, patient, and uncomfortable process of getting to know people of other races.

Bacote in the third session cast the Evangelical response to the larger problem of race in America in terms of lament and hope. Lament acknowledges the brokenness of our world but, if left untended, leads to cynicism. The Christian eschatological hope means that the sentences of our laments end not with a period but with a comma. On the one hand, the Bible provides hope in a final resolution of the ills of life on the fallen earth. On the other, it doesn't give us a pass to sit on the bench in the meantime. Of course, exactly what we should do in the meantime is the challenging question, one that Evangelicals, with their lack of theological and historical depth of knowledge, find especially hard to answer.

Finally, you will have to wait until tomorrow to learn about Bacote's specific comments on the approaches of James Davison Hunter ("faithful presence") and Rod Dreher ("The Benedict Option") and some other miscellany.

If you can't wait, feel free to join Dr. Bacote in worship tomorrow at WRPC,

22 February 2017

The Night of the Living Dead Is Coming: America's Pension CrisES

If you didn't buy what I was selling about America's multiple pension crises herehere, and here, check out George Will here. A concluding teaser:
The problems of state and local pensions are cumulatively huge. The problems of Social Security and Medicare are each huge, but in 2016 neither candidate addressed them, and today's White House chief of staff vows that the administration will not "meddle" with either program. Demography, however, is destiny for entitlements, so arithmetic will do the meddling.

The combination of subterranean promises to politically favored groups, unrealistic assumptions about rates of return on investments, and the declining middle-class birthrate makes the question of a fiscal cliff not one of if but of when. For now, though, we can count on all our political elites to sweep the problem under the rug.

15 February 2017

"The King Never Smiles"

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For Christmas Jeremy gave me a book he had purchased on his way out of Thailand: "The King Never Smiles" by Paul Handley. Handley is a journalist, not a historian, but clearly spent lots of time working his way through the documents surrounding the reign of Bhumibol Adulyaej, the late king of Thailand.

King Bhumibol ascended the throne in 1946 and reigned until his death in 2016. Bhumibol's 70+ years on the throne is a record for modern royalty. While always something of an (always-changing) constitutional monarch, the perception of Bhumibol's status as a Buddhist (with a Hindu twist) dhammaraja gave him a standing exceeding even that of the post-WWII emperor of Japan. Coupled with the lack of a tradition of the rule of law or constitutionalism, Bhumibol effectively ruled through a series of weak civilian and powerful military governments.

In spite of a form of rule that was highly personal and opaque to most Thais, Bhumibol retained the respect of his people. Blame for mismanagement, corruption, natural disasters, ecological degradation, and crime were heaped on Thailand's ever-changing governments; the king managed--most of the time--to appear to remain above the fray. He was not, of course. Nudges and hints and mere public displays of dissatisfaction were usually enough to topple a civilian government in favor of another military junta.

Notwithstanding Handley's painstaking work to uncover what was really happening, and notwithstanding his incredulity that Thailand continued to move forward economically and culturally through the succeeding decades of Bhumibol's reign, he was forced to admit that the king's extraordinary Buddhist virtues played a role unimaginable from a Western perspective. That to his people Bhumibol conceivably was a bodhisattva covered a multitude of governance sins.

At least for a while. Although Bhumibol lived for another ten years after the book ended, Handley correctly observed that personal rule depends on the person and that the king would not live forever. With his death in 2016, Bhumibol's venial playboy son has ascended the throne. No one will think that Vajiralongkorn is a selfless dhammaraja. Without a semi-divine personage to unite Thailand, the current military dictatorship may collapse under the weight of its exceptional corruption.

"The King Never Smiles" is more than the peculiar story of a long-lived king of an unusual nation-state in Southeast Asia. It should also stand as a warning to paleo-conservatives who long for the restoration of a nation "rightly ordered" instead of the current war of competing subjective rights that characterizes late-Liberalism. (Go here, here, here, and here for my four-parter on the topic of "right order" vs. "rights.") An orderly society in an orderly nation can be as disordered as the contemporary rights-crazed West.

A strong constitutional order including the rule of law is vital to the flourishing of a people. Such an order is not necessarily inconsistent with a hierarchical society. Yet a people need more than a virtuous leader; they need a leader and a system of governance that trains them in virtue, one that puts virtue into practice in more ways than personal or familial piety. We can only hope that Thailand makes the transition.