The Ironic Ambivalence of a One-Kingdom Guy

One might think that with three 24-hours cable news outlets in American we would hear all the news, not simple incessant rehashes of the same few stories. For a story unnoticed by any in the American media world go here to read a piece by a deeply conflicted David Koyzis of the Center for Public Justice. The CPJ is a long-standing Christian and nonpartisan political and public policy think-tank. I've linked to an earlier piece posted by the CPJ here.

In any event, the CPJ operates firmly from within the one-kingdom perspective of Christ's mediatorial kingship. This distinguishes the CPJ from, say, D.G. Hart who is a firm two-kingdoms guy. But Koyzis shows some warranted discomfort with the new constitution of the nation of Hungary. Why? Not because it provides that “the role of Christianity in preserving nationhood” nor because it honors its historic king, St. Stephen, who “built the Hungarian State on solid ground and made our country a part of Christian Europe one thousand years ago.” And certainly not becuase it acknowledges the role of the family in the nation, recognizes marriage as a union of a man and a woman, and claims to defend human life from conception.

Given that Koyzis believes each of these provision is largely correct from an historical and public justice perspective, what fault does he find? That the new constitution was not drafted by an all-party political conference but instead solely by Hungary's legislature under the domination of a single political party (which happens to have a two-thirds majority in both houses).

Koyzis contrasts Hungary's new constitutional ordering with America's where all political parties acknowledge the validity of the U.S. Constitution. In other words, the U.S. Constitution, Koyzis implies, is supra-political, above the sordid fray of party politics.

Two comments. First, the Constitution only appears supra-political from a perspective of 200 years after the fact. It was most decidedly the output of only a part of what was then America's relatively small political elite and was fiercely opposed by many frozen out of the drafting process. It appears today to be politically benign given over 200 years of structural domination reinforced by the results of the bloodiest war in America's history.

Second, and here Koyzis's ambivalence is barely detectible, Hungary's constitution can be perceived as insufficiently secular. I've posted here and here about the virtues of secularity in contrast with secularism. It's not at all clear that the new constitution does not provide free public space for those who reject the persisting significance of the facts recited in the constitution's preamble. As he admits, "a reading of an English translation of the [Hungarian constitution] reveals nothing particularly offensive to democratic institutions." Thus one cannot help but be bemused by the ironic efforts of one like Koyzis who is  committed to the truth of Christ's universal kingship as he finds a thin reed on which to disavow a constitutional structure that expresses his very point of view.

A Work Worth Reading

While its title, "The Protected Innocence Initiative:Building Protective State Law Regimes for America’s Sex-Trafficked Children," is a bit ponderous, its topic is of vital importance. Colleague Tessa Dysart has written a thorough analysis of federal and state laws on domestic minor sex trafficking. More importantly, Tessa explains why state and local investigation and enforcement is crucial and provides a thorough introduction to the work, findings, and proposed methodology of the "Protected Innocence" Initiative.

Go here for the complete abstract and to download the piece. The print version will be published by the Columbia Human Rights Law Review.

More (Bad) Detroit News

You can check my previous observations about the parlous state of Detroit's financial future here and here. You can read today's NYT account of the report by Kevyn Orr, Detroit's state-appointed emergency city manager, here. (For those who have access to Reuters, you can read a more extensive account here.) Very bad news across the board but two comments especially caught my attention. First, that Detroit supports two times as many retirees as current city employees. Second, the brain-dead comment from the city's AFSCME union rep:

“It’s not as bad as what they’re trying to make it out to be,” Edward L. McNeil, a local official for the American Federation of State, County and Municipal Employees, said on Sunday. Mr. McNeil had not viewed a copy of Mr. Orr’s report, which was not made public until late Sunday, but he said he had grown accustomed to overly negative assessments of Detroit by the state and its representatives.(Emphasis added.)

Renegotiating Detroit's 28+ labor contracts must of necessity be one of the pieces of restoring it to financial solvency. Reducing retiree benefits can be accomplished the hard way, by agreements between the city and its unions. Or the harder way, in a Chapter 9 bankruptcy.

The clock is ticking.

Political-Theological Musings

I've taken a shot at D.G. Hart's two-kingdom ideology at least once. But his blog post here, which asserts that even contemporary Roman Catholics espouse something like a two-kingdoms approach to political theology, is worth a read. You can find my best takes on the subject of political theology here (God's Bridle: John Calvin's Application of Natural Law) and here (Looking for Bedrock: Accounting for Human Rights in Classical Liberalism, Modern Secularism, and the Christian Tradition). One might find a less academic expression in my post here (Christianity: Ground of Secularity?).

Perhaps I can use a metaphor from constitutional law to express my point. The difference between ecclesiastical and political theology can be compared to express and field preemption. Whenever the federal government enacts a statute that expressly provides it trumps relevant state law, it does. However, it's up to the courts to decide what to do whenever the federal statute is silent on its relationship to state law. It might be that the federal and state statutes can both be applied. Obviously, if they conflict, so much the worse for the state law but the middle ground is where we find the action. If the courts conclude that Congress has legislated so pervasively then even state laws that don't contradict the federal statute are subject to "field preemption" and unenforceable

The courts have developed a variety of so-called tests to decide when Congress has legislated so pervasively as to occupy an entire "field" of law but suffice it to safe their standards do not lead to predicable results.

The final legal "space" is occupied by state statutes alone, situations where the federal government has chosen not to act. (An ever-decreasing space, by the way.)

Nowhere do I read the Bible to expressly preempt even the field of ecclesiology. (Sure, some folks do, but I don't.) However, it can be cogently argued that the Scriptures so occupy the field of the doctrine of the church and its worship that there is virtually no remainder. Field preemption, in other words.

Not so with respect to the realm of civil government. Not only do the Christian Scriptures not state expressly that they provide the sole basis upon which to formulate the rules of civil government, they cannot plausibly be read to so occupy the field of political theology that nothing is left for human ingenuity (or folly). While there are some specifics beyond which civil government may not go (commanding what God forbids or forbidding what God commands), these are relatively few.

It is this space, where the Scriptures do not speak, that is what I call "secularity." It's not secularism, which holds there no room for appeals to the transcendent, but only a space free until the end of time from direct biblical prescription. It's not a "kingdom" independent of God's rule but it is an large area of life over which Christians qua Christians can legitimately disagree and within which Christians and non-Christians can cooperate in good conscience.

Charmed, I'm Sure

Longer in gestation than any other article, Third Time's the Charm: The Coming Impact of the Restatement Third, Restitution and Unjust Enrichment in Bankruptcy has at last seen the light of cyber-day. For those who want the official source to cite, it's 40 Pepperdine Law Review 843 (2013). Those who'd rather get it via the internet can go here to download.

Quoting my abstract:

Bankruptcy courts have frequently been characterized as courts of equity. Often this characterization has accompanied unusually relaxed interpretation or application of a provision of the Bankruptcy Code. However, this understanding does not exhaust the meaning of equity in bankruptcy.

Historically, equity covered a large range of topics–trusts and estates, injunction, contracts, specific performance, unjust enrichment, restitution, and disgorgement. In addition, equity was not limited to particular remedies. Equity’s remedies certainly included money damages but recognized many more. The law of equity was substantive as well as remedial; it recognized primary rights as well as secondary rights of rectification. Among equity's primary rights were equitable interests in property. And section 541(a) of Bankruptcy Code includes such equitable interests in its definition of property of the estate.

If equity once boasted a substantial substantive content, what was it? The answer is found in the title of the Restatement Third, Restitution and Unjust Enrichment (R3RUE). Unjust (or unjustifiable) enrichment provides the conceptual core of this body of law. As the converse of tort law, which identifies unjustified harms to another, unjust enrichment recognizes unjustified benefits to another, at least to the extent they come at the claimant’s expense.

Notwithstanding the merger of law and equity, in the mid-1990’s the American Law Institute appointed Andrew Kull as the reporter for the R3RUE. With final approval in 2010, we can expect to see the R3RUE affect the legal landscape in the near future. It is that impending impact in bankruptcy that constitutes the burden of this article.

Part I briefly summarizes the substantive law of equity as expressed in the R3RUE. It addresses the substantive core of law of equity. Distinct categories of operative facts such as benefits conferred by mistake or without request, pursuant to a voidable contract, or as a result of wrongful interference with the rights of a claimant ground unjust enrichment.

Part II surveys the remedial aspects of the R3RUE comprising the four so-called proprietary remedies–constructive trust, equitable lien, subrogation, and the paired set of rescission and restitution. These proprietary remedies are the equitable interests in property that are part of the property of the estate.

Finally, Parts III–VI focus on these four remedies in greater depth and examine how courts operating under the Bankruptcy Code have (mis)applied them. I conclude with specific observations about how the R3RUE can and indeed should affect the development of equitable interests by firmly recognizing their place as property of the estate.

I've posted a number times on the topic of the R3RUE (check here), its relationship to the field of Anglo-American law known as equity (here), and--most importantly for my purposes--its effect in bankruptcy (here). I won't take the time to unpack my arguments and conclusions on this blog; those who are interested will find all they care to know through the article. Or, coming soon to a computer screen near you, an on-demand Continuing Legal Education program hosted by yours truly in which he and Andrew Kull, R3RUE's Reporter, spend a delightful hour-plus teasing out its bankruptcy implications.

Third Time's the Charm is for bankruptcy insiders. If any such are among your friends, feel free to send them the link to the article. I'd be grateful.

Bubbles and More Bubbles

A Bloomberg headline reads "Bankers Warn Fed of Farm, Student Loan Bubbles Echoing Subprime." (Warning: may be behind a paywall.) Can I say, "duh"? Can I say, "I told you so"? Sure I can. See here (for farmland) and here (for student loans).

Speculative bubbles have always existed in market economies. Government actions have always had economic ramifications. However, it's particularly unfortunate to realize that current federal actions are likely contributing to the creation of not one but at least two speculative bubbles.

FWIW, I have little sympathy for avaricious farmers who irrationally stoke the price of farmland. I have much more sympathy for students who don't perceive the risks of incurring nondischargeable student loans. Sympathies aside, I am particularly concerned about the effects on American taxpayers when these bubbles burst. Bailouts, anyone?

The Devil's In The Details

Okay. So posting about government retirement accounting is about as dry a topic as can be imagined. Yet as I've noted here, underfunded state and municipal retirement pensions and retiree medical benefits account for a huge portion of governmental insolvency. (And, in the cities of Vallejo and Stockton, municipal bankruptcy.)

At The Economist piece here, once can read a fine and understandable explanation of the accounting details of the current dire situation.

Sadly, few with the power to do anything about the problem care to understand it. Or, if they understand, they certainly don't care to do anything about it. Kicking the can down the road is a time-honored way for elected officials to deal with unpleasant states of affairs. Eventually, however, folks will suffer and my greatest regret is that it won't be those who swept the problem under the rug for so many years.

A Disappointing Diversion

You can check here and here to read my comments about Regent Law School's "Endangered Gender" Symposium. The "It's A Girl" documentary was shown as part of the first night symposium program. I found it to be well-written, well-produced, and powerfully understated. Certainly unobjectionable to all but those who believe that sex-selective abortion is a fine thing. Or so I thought.

Today, thanks to Ross Douthat, I read this piece in slate.com tilted "It's A Trick." Instead of interacting with the documentary, writer Sital Kalantry spends virtually her entire piece "exposing" producer Evan Davis as one who also produces pro-life materials. Well that changes everything, at least in professor Kalantry's eyes.

That the issue of sex-selective abortion is a serious problem in many partes of the world, that "It's A Girl" is assiduously fair-minded, and, even more to the point, is absolutely correct in all it depicts, is of no consequence once the "duplicity" of its producer is disclosed. If the value of Davis's work can be disregarded simply because he happens to believe that unborn males and females should live, then we're arrived at a place where only those committed to a particularly virulent strain of an inhumane ideology are permitted to speak. Better to let the truth speak for itself than to allow ideologues like Kalantry to be the world's censors.

There's an expression to describe Kalantry's piece: hatchet job. I only hope her law students can do a better job of writing briefs than she does of writing reviews. If they don't, I can assure you that courts will give them as little credence as should be given her

Just (And Only) Say No ... For Now

No one can beat Ross Douthat for pulling back the curtain on the obstinacy that characterizes much of what goes on among certain right-wing ideologues. Read here for his latest. I've previously addressed the hypocrisy of contemporary Republican corporate welfarism here. Douthat observes that House Republican refusal to allocate what amounts to a $3.6 billion Health and Human Services slush fund to address underfunding of high risk health insurance pools is a non-vote for ideology, not reality. Not only did the House Republican forgo an opportunity to limit the discretion of one of their least favorite federal agencies, they turned their back on the only conservative and non-statist option to address health care needs of poor Americans. In other words, they effectively voted (or didn't vote) to remedy ramifications of the employer health insurance mandate, that which they've been railing against for years.

Douthat explains what was on the table in clear prose so I won't repeat it. Suffice it to say that what motivated the rejection of Eric Cantor's proposal was either a failure of comprehension or conviction. Refusal to recognize that the federal government already subsidizes health care through the Internal Revenue Code exemplifies the former; pretending that there is a market solution without high-risk subsidies discloses the latter.

Some ideological purists may argue that it was not a failure at all but a principled acknowledgment that the purpose of the civil state is to protect life, liberty, and pursuit of property and nothing more. Libertarian ideology, like any ideology, fails the test of empirical reality. (Check here, here, and here for some earlier anti-ideology remarks.) Even more to the point, ideology fails the test of political reality.

Consider the following future history. Republicans beat back "Hillarycare" in 1993 only to succumb to Obamacare in 2010. I predict that Obamacare will collapse by 2016, at least those parts designed to provide health insurance for the working poor through their employers. What then? Without the sort of subsidized private insurance coverage that the House refused to take up, American will move to some form of a single-payer system by 2026. "Be careful what you wish for" is worth remembering.

Of course, it's entirely possible that a Republican-controlled House will vote to fund the very high risk subsidies they currently refuse to consider if there is a Republican in the White House. Hypocrisy is never far from electoral politics.

Crowdfunding Live!

Some time ago I posted a tease here about an upcoming podcast with Dan Gorfine and Ben Miller about crowdfunding. Well, at long last here it is. Gorfine and Miller are not academics; they actually use crowdfunding, and do it effectively. It's very instructive to learn of their success stories and, equally important, to hear why they do not believe that crowdfunding is an open door to fraudsters.

(For additional "ripped-from-the-headlines" excitement, you can read a very recent article from the WaPo here in which Dan Miller is prominently mentioned.)

Stocking Up

Apropos of earlier posts (here and here) about the Chapter 9 of the City of Stockton, California, comes today's news here (Reuters; paywall perhaps) that Stockton plans to file a plan of adjustment "as early as July" (don't bet on it). The question that's even bigger than where Tim Tebow (here; j/k) will play football next season is how Stockton will treat its bondholders vis-à-vis CalPERS (short for the California Public Employee Retirement System).

The article quotes the city's lawyer, Marc Levinson, making cooing sounds about everyone negotiating to a consensus but I don't see that happening unless Stockton rejects its retiree benefits contracts or CalPERS cuts the city some slack on what it must pay or some combination of the two. The only remaining possibility I can foresee would be for the city to promise everyone everything but if Stockton had that kind of money (or rather, if it's taxpayers could afford that kind of money), it wouldn't be in bankruptcy.

If, as some reports have suggested, Stockton's plan promises a substantial haircut for its bondholders (or rather, again, its bondholders' insurers), they will fight it from the Bankruptcy Court, through the Ninth Circuit BAP (Bankruptcy Appellate Panel), to the Ninth Circuit, and beyond. A negotiated settlement is indeed in everyone's interests but unless some heretofore immovable objects give at least a little, I don't see it happening.

Libertarian Rhetoric

Not long ago I posted here about why I'm not a libertarian. I would instead characterize myself, from a political-theoretical perspective, as a common law conservative. You can go here for a post in which I trumpet the virtues of common law conservatism. You can go to the blog of my friend Ruben Alvarado or buy his book, not coincidentally named Common-Law Conservatism, if you want to know more.

A shy reader of my recent post sent me the following comment:

It seems to me that you are right insofar as an unbelieving libertarianism needing a firm ethical base to provide ought-ness. I don't see any reason why libertarianism's procedural framework of non-aggression cannot both find that base in biblical revelation, as well as providing a guiding principle for Christian political action in an unbelieving world.

A brief reply would be, yes but ... In other words, a naturalistic libertarian political theory (like any naturalism) runs aground when it comes to the "sez who?" objection. Natural rights amount to little more than dogmatic assertions when decoupled from a world of theistic or at least metaphysical substance. Nor can a pure natural rights philosophy deal effectively with the "so what?" objection. Even if there are "things" such as natural rights, who says why anyone should care about them except out of personal prudence? There would be no moral obligation to rectify violations of them.

But what if we undergird libertarianism with Christianity? Will that solve its metaphysical and moral problems? Again, the brief reply would be, yes but ... The challenge to libertarianism is its implicit individualism. It's the unadulterated -ism that, on the one hand, may render libertarianism, even when espoused by Christians, functionally inconsistent with long-standing Christian teaching. Consider the following observation by Robert Louis Wilken in The First Thousand Years: A Global History of Christianity:

The Councils of Nicaea and Constantinople ensured that Christianity's distinctive understanding of God would become a permanent and enduring part of Christian tradition. Although Christians were unreservedly and unequivocally monotheistic and believed, along with Jews, and later with Muslims, that there is one God, they understood that God was not a "solitary God," as one church father put it. This affirmation, that God inner life was triune, was a great impetus to Christian thinking and to spiritual life, for it affirmed that the deepest reality is communal. (Emphasis added.)

In their defense, many Christian libertarians would express agreement with Wilken's assertion and argue that their anti-collectivistic  rhetoric is directed against the modern Leviathan State and not against other forms of social community. Their defense of a particular understanding of marriage--between a man and a woman--valorization of the family, and efforts to preserve the life of the unborn would be a prime examples of communitarian virtues.

Yet on the other hand one might be forgiven for believing that even Christian libertarian affirmations of the communal structure of society has more bark than bite. Or, at least it sounds that way. By way of example, what has become of early Tea Party denunciations of the corporate and banking bailouts of the late-Bush and early-Obama administrations? Attacks may yet be heard about the distorted federal refinancing of General Motors and Chrysler but one listens in vain to the Fox News talking heads for criticism of the federal subsidies of their corporate paymasters. (For a rant on an example of this topic go here.)

If, as I've heard some Christians assert, the State functions only to preserve life, liberty, and the pursuit of property, then it's not difficult to understand why for most Americans a Christian flavor of libertarianism sounds like a baptized but unrepentant Gordon Gecko of "greed is good" fame. (Not so long ago--if my childhood falls outside the ambit of the ancient past--most conservative Protestants would have called this "worldliness.") This might explain why a naturalized libertarianism that includes gay marriage is gaining traction. Of course, Ron Paul's average 5% vote in Republican primaries might suggest that neither version of libertarianism is likely to gain control in American politics.

In any event, without a more "Front Porch Republic[an]" sensibility, it seems unlikely that Christian libertarianism will come off as anything more than shrill and self-serving to the ear of most Americans. Accompanied by a thorough critique of contemporary corporatism and consumer capitalism, Christian libertarianism might get a hearing beyond the already converted. Coupled with a meaningful localism, joyful acknowledgment of human dependence, as well as commitment to an international "framework of non-aggression," and maybe, just maybe, it could have an impact in society. Until then, regardless of its practice, libertarianism's rhetoric of individualism will limit its appeal.