May 27, 2009
And They Said Bush Was CluelessBy Christopher Chantrill
The President mentioned the Rule of Law in a speech last week. At the National Archives about his policies on terrorism, he said:
But the previous week the administration blew off the Rule of Law in the Chrysler bankruptcy. It stiffed the senior secured creditors in favor of a junior creditor, a labor union. That's probably unconstitutional, because the US Constitution calls for "uniform Laws on the subject of Bankruptcies throughout the United States." You can see why the founding fathers might think uniform bankruptcy laws were a good thing. It would provide protection for creditors, never the most popular people in society, against a politically favored special interest like a labor union.
If you are not going to favor secured creditors over a politically powerful interest, why bother having laws, or a Rule of Law at all? Just let the unpopular people go to the wall. Tell them to hire a politician next time.
There seem to be two ways of looking at the Rule of Law. For liberals the Rule of Law is all about the protection of brave liberals fighting against racism and sexism. But if you read the history of law in the Anglo-Saxon world, you find out that law is mostly about deciding what to do when things go wrong in day-to-day living and commerce. For instance, there is the law of bailments. It's nothing special, but it covers the case of the restaurant valet that damages your car, and it has existed at least since Babylonian times.
Anyway, it seems that President Obama's devotion to the Rule of Law is only rhetorical. He is going to keep the Bush policies on terrorism, but will keep making speeches to entrance liberals like James Fallows at The Atlantic with "the quality of [his] thought."
The neutering of bankruptcy law in the Chrysler case is not rhetorical; it is real. And, to echo Talleyrand, it is worse than a crime, it is a blunder. For consistent bankruptcy law is as important to a smashed-up corporation as a well-run trauma center to an accident victim.
Capitalism is a social technology in the same way that the a trauma center is social technology. You can let the technicians organize and run it, subject to law, or you can stick your political nose in and order the professionals around. Just to show who's boss, you can mix in a special deal for a powerful interest.
Time and time again in the last century, liberals have insisted that only political power can deliver the right kind of service from business. First we had to have a Federal Reserve System because you couldn't trust the Money Trust. That worked out well. The dollar is now worth 2.5 cents.
Then they decided that America's corporations had to have strong unions -- in 1935 right in the middle of a Great Depression. That worked out well. It plunged America into a second depression in 1937.
They decided that senior citizens had to have subsidized health care. So now health care for seniors is eating the budget alive, and that's before the $40 trillion that's promised but not funded.
They wanted everyone to have "affordable housing." Well, now they have their wish. Pity they had to blow up the banking system to get there.
And these are the people that called President Bush clueless!
There is another way. We could let capitalism get on with its job of delivering products and services that people are willing to pay for. Then we could start to figure out how to deliver health care that people could afford.
Against the clunking fist of the liberal administrative state we conservatives must call for a conservative sociable state. Social animals, humans are at our best when living in a world of reciprocal sociability; we are at our worst when issuing administrative orders to people that can't answer back.
Marriage advocate Maggie Gallagher recently showed how reciprocal sociability works. While watching a lesbian and an evangelical in a focus group discussing gay marriage, her associate was appalled at the way that the participants would compromise. They had no principles, he complained.
It's the difference between liberal world and conservative world. In liberal world highly evolved elites get to decide on the issues and force everyone else to get with the program. In the conservative world of families, churches, and associations we are just trying to figure out a way in which everyone can be OK.
Yet conservatives insist that we believe in permanent principles that cannot be changed, and liberals insist that everything they do is based on empathy and compassion for other people. What is going on here?