On Corporate Privilege – Have They No Shame?

April 21, 2015

In a legal system which holds corporations responsible for virtually nothing, corporate power, hypocrisy and the wall of corporate shame keep growing.

Corporations put clauses in consumer contracts that make suing them useless and impossible. They make us sign those contracts for most of what we buy from the modern economy. The Supreme Court says OK on the fiction that we don’t have to sign the so-called agreements. As far as the Court is concerned, all we have to do is opt out of the economy and then no corporation can bother us.[1] If a dispute ever gets to a hearing, it is heard by arbitrators chosen by the corporate sellers.

Industry groups repeatedly argue that they have to put such abusive provisions in their contracts or they couldn’t give us a good deal. In other words, when people are down, their mortgages underwater, corporations should just keep kicking – they’re really just doing it for us.

That’s bad enough for people who are just trying to be treated fairly. But corporations have been getting the privilege of trashing rules protecting us from toxins and pollutants in favorably disposed forums. These are so-called investor-to-state dispute settlement or ISDS clauses in international trade agreements. Corporations can attack any rules that will cost them money, which of course means all regulation is vulnerable. Like the domestic arbitration clauses that the U.S. Supreme Court has blessed, “These challenges are not heard in a normal court but instead before a tribunal of private lawyers,” as the Alliance for Justice and many prominent attorneys have told Congress.[2]

There’s already an ISDS clause in the North American Free Trade Agreement, or NAFTA.[3] Corporations are trying to keep the ISDS mechanism in trans-atlantic agreements that multi-nationals will use against food and environmental laws here and in Europe, claiming they restrict free commerce.[4] Cecilia Malmstrom, the European Union’s trade commissioner, responded “We want the rule of law, not the rule of lawyers.”[5]

Describing the terms of the 12-nation trade accord for a Trans-Pacific Partnership for which Congress is considering fast track authority for President Obama, Jonathan Weisman wrote in the Times that it would “allow foreign corporations to sue the United States government for actions that undermine their investment ‘expectations’ and hurt their business,” using the business friendly ISDS procedure.[6] Once again that is poised to protect multinational corporations from food, health and environmental regulation.

In D.C., the coal industry is trying to convince the U.S. Supreme Court to block the Environmental Protection Agency from going ahead with procedures for strengthening rules preventing toxic emissions of mercury.[7]

Here at home, toy industry groups are suing against efforts of Albany County to ban the sale of toxic toys, with such poisons as lead, mercury and arsenic, claiming it’s a violation of the Constitution and federal statutes.[8]

Business repeatedly claims regulation isn’t necessary because they are honorable and we can trust them and the economy. But their choice of legal targets make clear what they really believe.

No one has the right or privilege to put toxins in us, in our air, water, or our kids’ toys. Have they no shame? It’s time we had a government, all of whose branches respected the rights of the rest of us.

— This commentary was broadcast on WAMC Northeast Report, April 21, 2015.

[1] See American Express Company v. Italian Colors Restaurant, 133 S. Ct. 2304, 2313 (2013) (Kagan, dissenting); Buckeye Check Cashing, Inc. v. Cardegna, 546 U.S. 440 (2006).

[2] Letter over the signature of many well-known law professors and sent by the Alliance for Justice to congressional leadership, available at http://org2.salsalabs.com/o/6539/p/dia/action3/common/public/?action_KEY=19342.

[3] NAFTA ch. 11.

[4] REUTERS, EU Seeks Solution to Keep Arbitration in U.S. Trade Deal, March 18, 2015, 12:22 P.M., http://www.nytimes.com/reuters/2015/03/18/business/18reuters-eu-usa-trade.html.

[5] Id.

[6] Jonathan Weisman, Trade Pact Seen as Door for Suits Against U.S. New York Times, March 26, 2015, at B1, available at http://www.nytimes.com/2015/03/26/business/trans-pacific-partnership-seen-as-door-for-foreign-suits-against-us.html.

[7] Editorial, Dirty Coal at the Supreme Court, New York Times, March 23, 2015, at A20, available at http://www.nytimes.com/2015/03/23/opinion/clean-air-act-and-dirty-coal-at-the-supreme-court.html?emc=edit_tnt_20150323&nlid=47098180&tntemail0=y.

[8] Matthew Hamilton, Industry contests toxic toys ban, Albany Times Union, April 17, 2015 at A1.


Libertarians on and off the Court

December 2, 2014

Most Supreme Court justices are libertarians in some sense. But what kind and for whom varies widely.

We all believe we have rights to decide lots of things for ourselves. But what are the limits? The more “conservative” the justices and others are, the closer to the Tea Party, the only limits they recognize are force and fraud. Various conservative philosophers have been very plain about that. Regulations, almost all regulations, interfere with that freedom of action.

People sign contracts every day that have draconian consequences for them, but, say the far right, you agreed to that. You signed a contract for which the only remedy is a stacked deck, arbitration in front of an arbitrator arranged by the company, and you have no right to unite with other people in the same situation to fight expensive battles together and share the costs – that’s called a class action, and the Court’s conservatives forbid it in arbitration, won’t allow the states to try to protect consumers from such restrictions on their rights. That protects the company’s liberty. And of course you had the liberty not to sign – if you read and understood the contract and had a realistic choice.

You signed a mortgage with a lender and it had all sorts of hidden costs, fees, rates and traps that put a lot of people underwater and helped to build and then break the housing bubble, and with it the economy. But, tough, you signed, say the conservatives.

Most states used to forbid usury, interest rates that no one could reasonably pay but that piled up so quickly bankruptcy was inevitable. Not any more – the Supreme Court made sure states could no longer forbid usury.

And where the conservatives on the Supreme Court couldn’t block federal law, like the antitrust laws which were intended to give us the benefit of competition and protect us from monopoly, they made it impossible to prove.

There are an endless set of examples. The company gets the liberty and you get the shaft.

But when you get the shaft, that doesn’t just affect the liberty that judges and legislatures say you have. Getting the shaft affects your real liberty – liberty to make wholesome life choices for yourselves and your families. Most of us think our liberty is limited by the effect on other people’s liberty. Giving people the shaft deprives people, ourselves and lots of others, of our very real liberty.

Most states tried to limit legal liberty to do things that harm others. There should be no liberty to foul the water we drink or the air we breathe. There should be no liberty to bury costs in fine print legalese, or propose terms that the company knows will do damage. There should be no liberty to put people into unsafe working conditions when the company could have saved their lives, saved people from collapses and explosions in coal mines, oil rigs, and similar disasters. It doesn’t matter that the workers agreed, signed a contract, took the job – the company knew and we should be able to stop it.

We too believe in liberty, but it is liberty bounded by what’s good for everyone. We have a choice between freedom for those who have the money and power to exercise it, or freedom for everyone based on some realism about what’s going to happen.

Do we care? The protectors of corporate legal liberties on the Court have a child’s idea of liberty – without responsibility. Children throwing tantrums at civilization have no place on the Court.

— This commentary was broadcast on WAMC Northeast Report, December 2, 2014.


Regionalism vs. the Environment

August 26, 2014

There’s been news recently about a decline in gas prices. Hallelujah? Or oh my God! Decline in prices means more people will build energy inefficient homes and invest in gas guzzling machinery or businesses. Some will benefit, but the world will suffer. How do we accommodate those inconsistent objectives? Read the rest of this entry »


Tailspins for the Poor

August 5, 2014

George Gershwin wrote “I’ve got plenty of nothing, and nothing’s plenty for me.” But sometimes it seems like politics is about the art of squeezing or taking as much as possible from people who have nothing at all – the villainy of the Sheriff of Nottingham in the Robin Hood story but in modern dress. Read the rest of this entry »


The Anti-Union Court

July 1, 2014

The Court decided yesterday in Harris v. Quinn that at least some of the employees who work under a collective bargaining agreement don’t have to share in the costs of negotiating that agreement. The Court says it violated their First Amendment rights. How many unions and employees it will apply to is still unclear but this is not the first move the Roberts Court has made in that direction.[i] Sometimes the patterns matter much more than the individual decisions, whether good or bad. Read the rest of this entry »


Passover – The Indivisibility of Freedom

April 15, 2014

This is Passover, a holiday that comes straight out of the Bible, the Almighty commanding us to tell the story of the Exodus to each new generation as well as reminding ourselves. The Exodus, of course, is a story of freedom from slavery. The Biblical story is about the Hebrew exodus from slavery in Egypt. But we are very explicit about relating that story to the freedom of others. Read the rest of this entry »


Economics, Lawyers and the Risk to American Democracy

April 1, 2014

Ever notice that I frequently talk about economics. What’s a lawyer doing talking about economics? I did read and study economics but there are other reasons why economic issues are dear to this heart.

Lawyers do lots of different things. But for many of us, law is a helping profession. We work with people who are headed for bankruptcy and other events that will turn their lives upside down. We do our best to help them avoid personal tragedies – or pick up the pieces. We don’t think of clients as numbers but as people, most of whom we like and respect. We learn not to think of financial reverses as a judgment about their character, decency or personal value. It happens for all sorts of reasons, often beyond our clients’ control. When it is a mistake, it is often a part of learning how to do business or operate in this world. Some of the world’s most successful people have been through bankruptcy. Up close and personal, we care.

So the national recession wasn’t just a set of numbers for me. It was a catastrophe in the lives of many people. They were passengers on the national ship on a foggy night when the captain  crashed into another vessel. Millions of people went overboard, leaving their jobs and belongings behind. Rescuing people isn’t a choice; it’s an obligation just as it was not optional whether to pick our friends up from the wreck of the Achille Lauro. An S.O.S. has a clear and obligatory meaning.

But there is another reason. One could trace it to a famous French aristocrat who visited and wrote about the U.S. in the 1830s but statistical studies beginning after World War II keep making the point that poverty and inequality are both hostile to the survival of democracy. Historians studied the failure of democracies on multiple continents and reached the same conclusion. Others with different methodologies keep reaching similar conclusions.

It’s not a surprising conclusion. During the Great Depression in the 1930s, many were worried that we would lose our system of self-government, and some advised President Roosevelt to take dictatorial powers, but he refused. Now science has come to support common sense. Poverty can be dangerous, not only to individuals but to society. It makes people desperate and when they are, all bets are off.

With that knowledge, it is painful to me to watch Congress leave the victims of corporate shenanigans in the dirt as if they were so much trash. And as an attorney, it is particularly painful to me to watch the U.S. Supreme Court under Chief Justice Roberts doing everything in its power to play the role of the Sheriff of Nottingham, robbing from the poor to pay the rich. Many of those decisions are complex legally as well as economically but their effect on the fairness of the contracts we sign daily and on the lives of many people are extensive and often tragic. To me, the Roberts Court is threatening our democratic patrimony.

The personal suffering would be enough. The risk to our country is hard to bear.

— This commentary was broadcast on WAMC Northeast Report, April 1, 2014.


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