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More Posner Sloppiness re Catholicism

In his post on Catholicism and contraception, which I criticized earlier, Judge Richard Posner opines that:

The Roman Catholic Church is a huge “corporation,” ....

Wrong again. Neither as a legal, theological, nor practical matter is the Roman Catholic church viewed as a single corporation. I address this issue in my article The Bishop's Alter Ego.

Canon law views both a diocese and its individual parishes as distinct juridic persons. The commentary to Canon 393 thus provides that: “Once it has been legitimately erected, a diocese possesses juridic personality….” Likewise, per Canon 515, the parish “possesses juridic personality.” Just as the bishop represents the diocese in its juridic affairs, the parish priest represents the parish in all its juridic affairs.

In canon law, “ownership of goods belongs to that juridic person which has acquired them legitimately.” Accordingly, canon law views assets of a specific parish as being owned by the parish rather than the diocese. Assets of parishes and other public juridic persons within a diocese thus are ordinarily administered by the priest who governs the entity in question and not by the diocesan bishop.

As for secular law in the United States, the legal status of the Church varies. In some dioceses, there is a single corporation that holds all assets of the dioceses and its individual parishes. In others, however, there are many separate corporations, with each parish or other juridic person having been incorporated separately.

As such, the Church does not consist of a single corporation. There is no state in which there is a single corporation owning or representing the Church as a whole. There is no national corporation representing the Church in the United States. There is no single global entity comprising the Roman Catholic Church.

A rather trivial case will prove the point. In 1968, William Sheffield visited the ancient Hospice du Grand St. Bernard in Switzerland, a monastery of the Canons Regular of St. Augustine, a Roman Catholic religious order of priests. While in Switzerland, Sheffield contracted with the cleric in charge, Father Bernard Cretton, to buy a St. Bernard dog for $175 plus the $125 freight to ship the dog to Sheffield’s home in California. Sheffield was to pay the price in $20 installments and Cretton agreed to ship the dog upon receipt of the first $20.

Sheffield made three $20 payments, but the monastery refused either to ship a dog or to refund his money. Sheffield then sued in California state court for the price of his substitute dog ($200) and his non-refunded $60. In the suit, he named Cretton, the Canons Regular, the Vatican, the Pope, and the local archdiocese (in the person of then-presiding Archbishop of San Francisco). Roman Catholic Archbishop v. Superior Court, 93 CAL. RPTR. 338 (Cal. App. 1st Dist. 1971).

Although Sheffield apparently was able to serve process on and obtain personal jurisdiction with respect to the Archbishop of San Francisco, he faced significant obstacles in doing so with respect to both the Pope and the monastic defendants. In an attempt to circumvent those problems, Sheffield invoked the alter ego doctrine:

The complaint alleges that defendants Archbishop and the Canons Regular of St. Augustine were controlled and dominated by defendants Roman Catholic Church, the Bishop of Rome and the Holy See, that there exists a “unity of interest and ownership between all and each of the defendants,” that the Archbishop and the Canons Regular were a “mere shell and naked framework which defendants Roman Catholic Church, The Bishop of Rome, and The Holy See, have used and do now use as a mere conduit for the conduit of their ideas, business, property, and affairs,” and that all defendants are “alter egos” of each other.

The court rejected Sheffield’s argument, holding that the “uncontroverted” evidence that “the Archbishop had no dealings with the Canons Regular negates any possibility that the Archbishop so controlled and dominated that organization so as to be liable for its actions under the ‘alter ego’ doctrine.”

In other words, there is no global Roman Catholic corporation.

The point may seem trivial. But it has huge theological and legal import. It also stands as yet another example of how sloppy Judge Posner often is with facts, especially when it comes to religion.

I find Posner's sloppiness in this case amusing, because in his book Public Intellectuals he blasted public intellectuals for often doing sloppy work, which he called "little better than kibitzing" and which he said evidences "only a superficial engagement with the facts." Pot meet Kettle.

Yet, it's also troubling. Posner is a respected public intellectual, who musing are widely read. Yet, as Robert Araujo notes, Posner "offers little evidence demonstrating that he really understands religion, in general, and Catholicism, in particular." Regrettably, the uninformed reader may give Posner's ill-informed musing far more credence than they deserve.

Finally, it's worth pondering whether Posner's sloppiness reflects an underlying hostility. Posner once dismissed Catholic philosopher John Finnis' views of homosexuality as being "incomprehensible to the secular mind." (The Problematics Of Moral and Legal Theory at 76) Likewise, Posner dismissed the public square as a forum for social deliberation because it is tainted by religion: “Since so many Americans . . . are religious, and religious belief is a showstopper so far as public debate in our society is concerned, it is doubtful that deliberation over fundamental political goals and values is feasible outside our leading universities, the ethos of which is secular.”(Law, Pragmatism, and Democracy at 137) And then there's his claim that “[t]he combination in the United States of an extraordinarily high crime rate with an extraordinary degree of allegiance to Christian beliefs must make one question the pacifying effects of Christian zeal." (Sex and Reason at 235-36) These are not the words of someone friendly towards Catholicism or even of someone who is merely neutral.

In his essay Overcoming Posner (94 Mich. L. Rev. 1898), my former colleague Gerard Bradley complained of "Posner's recurring caricaturization of the Catholic Church when he should be engaging in counterarguments." Gerry also notes that "Posner squarely invites the reader to choose between religion ... and reality." Finally, Gerry catches Posner in yet another example of sloppiness with facts. Posner wrote that "Cardinal Bellarmine refused to look through Galileo's telescope at the moons of Jupiter, whose existence seemed to refute the orthodox view that the planets were fixed to the surface of crystalline spheres ...." As Gerry points out, however, "Posner is grotesquely wrong on the facts here. Bellarmine, a leading theologian of the day, was on friendly terms with Galileo. Bellarmine accepted Galileo's invitation to look through the telescope in April of 1611, and thanked Galileo for the opportunity." Yes, Galileo eventually got into trouble with the Church, but here again we see Posner evidencing "only a superficial engagement with the facts."

One wonders why Catholicism seems so often to be the victim of "a superficial engagement with the facts" in Posner's musings.

Posner Instructs Catholics on Contraception

Judge Richard Posner has decided to instruct those of us who are Catholics on our faith or, at least, the proper institutional strategy the Church should follow on contraception. Like much of Posner's work, it's interesting, provocative, and a little sloppy.

Money quote:

In 1930, responding to the Anglican Church’s rescission of its prohibition of contraception, Pope Pius VI  made an “infallible” declaration unequivocally reiterating the Catholic Church’s age-old prohibition of the practice, and his declaration was repeated by subsequent popes well into the 1990s. Were the Church now to repudiate that doctrine, it would undermine papal authority. Infallible papal pronouncements would be seen as tentative, revisable, like Supreme Court decisions, which have the force of precedents but can be and occasionally are overruled.

There are some non-trivial factual errors in that statement:

1. Pius VI lived from 1717 to 1799, which would have made it difficult for him to have made a statement -- infallible or otherwise -- in 1930.
2. I assume what Posner has in mind is Pope Pius XI's 1930 encyclical On Christian Marriage.
3. Pius XI's encyclical was not an infallible "declaration" because there is no such thing.
4. One source of infallible teaching in the Catholic Church consist of Papal definitions. As Vatican II put it: the pope "enjoys in virtue of his office, when, as the supreme shepherd and teacher of all the faithful, who confirms his brethren in their faith (Luke 22:32), he proclaims by a definitive act some doctrine of faith or morals. Therefore his definitions, of themselves, and not from the consent of the Church, are justly held irreformable, for they are pronounced with the assistance of the Holy Spirit, an assistance promised to him in blessed Peter." Nothing in Pius XI's encyclical rises to that level. Indeed, by most accounts, there are only two such definitions: The Doctrine of the Immaculate Conception of Mary and The Doctrine of the Assumption of Mary.
5. The other form of infallible teaching of the Church consists of the ordinary universal Magisterium. As Vatican II explained, "Although the individual bishops do not enjoy the prerogative of infallibility, they can nevertheless proclaim Christ’s doctrine infallibly. This is so, even when they are dispersed around the world, provided that while maintaining the bond of unity among themselves and with Peter’s successor, and while teaching authentically on a matter of faith or morals, they concur in a single viewpoint as the one which must be held conclusively. This authority is even more clearly verified when, gathered together in an ecumenical council, they are teachers and judges of faith and morals for the universal Church. Their definitions must then be adhered to with the submission of faith."
6. Although Pius XI's 1930 encyclical is generally regarded as anti-contraception, it was Paul VI's 1968 encyclical Humanae Vitae that is properly regarded as the clearest statement of the Magisterium with respect to contraception. Note that nothing in Humanae Vitae purports to be an infallible definition of doctrine. Because it has been widely accepted by the bishops and subsequent Popes, however, I have no doubt that it qualifies for infallibility as part of the ordinary universal Magisterium.

Now we come to the core question: Does the ordinary universal Magisterium evolve over time? If so, does that call into question the Church's religious authority?

I have no doubt that Papal definitions of doctrine are unchangeable. If a Pope were to disavow the Assumption of Mary, for example, that really would call everything about Church teaching into question.

But what about doctrines that are infallible because the bishops "concur in a single viewpoint as the one which must be held conclusively"? This is a huge category, that some argue encompasses most of the Catechism and much else as well. Does it develop over time?

Judge John Noonan's book A Church That Can and Cannot Change: The Development of Catholic Moral Teaching powerfully argues that Church teaching on moral issues like slavery, religious freedom, and usury has evolved over time (although I'm doubtful of the premises of his argument with respect to usury).

Noonan's argument brought fierce criticism from some, who argued that:

On account of the moral assault against the Church which rages today, therefore, Noonan's piece is both timely and potentially dangerous . . . dangerous because anything which opens a potential for doubt about the authority and reliability of the Church's teachings on moral matters will be exploited at once and ruthlessly by those who wish to undermine the Church's opposition to abortion, artificial birth control, divorce, what are euphemistically called “alternative life styles” (including gay marriage), euthanasia, pre-marital sex and “trial marriage,” artificial insemination, in-vitro fertilization, surrogate motherhood, etc.

Patrick M. O'Neil, A Response to John T. Noonan, Jr. Concerning the Development of Catholic Moral Doctrine, 22 Faith & Reason 59 (Spring-Summer 1996). (One wonders whether we should count Posner among those who wish to undermine the Church's position on lifestyle issues, but that's a topic for another day.)

The debate continues to rage. I don't propose to solve it today. Suffice it to say, I'm inclined to think that Church teaching does develop over time. So did Cardinal Newman, which puts me in pretty good company. (See An Essay on the Development of Christian Doctrine, in which he wrote that "we may fairly conclude that Christian doctrine admits of formal, legitimate, and true developments, that is, of developments contemplated by its Divine Author.")

Let's assume arguendo that the ordinary universal Magisterium does evolve over time. Is Posner (and O'Neill) correct to think that this undermines the Church's authority? When all is said and done, after all, this is Posner's key claim.

I think the answer is no. Noonan gives three reasons to think this is so: (1) "Do parents lose or gain authority with their children when they admit to a mistake in guiding them?" (2) The American judicial system gains authority by admitting its mistakes. Indeed, contrary to Posner's apparent view as expressed by his reference to Supreme Court precedents, Noonan acknowledges that the Supreme Court makes mistakes and that its doctrines develop, but nevertheless fairly asks where "is the prestige of a judicial system higher than in the United States?" (3) No one loses respect for science, which is constantly changing its mind.

Noonan concludes: "Admitting error, the Church would not fare worse than parents, judges, or scientists, except perhaps among those who have conceived of the magisterium as a perfect machine perfectly enunciating moral truth in all ways at all times in all places."

And there is an old quip suggesting that the Church has a well-developed technique for keeping the latter happy. The pope simply prefaces the announcement of a change by observing that “In accordance with the teachings of my predecessors," such and such and so and so.

In sum, we thank Judge Posner for his concern, but assure him it is misplaced.

For a further critique of Posner's post, go here.

How to handle classroom chaos?

Caron:

Inside Higher Ed, Should Profs Leave Unruly Classes?:

Professors routinely complain about students who spend class time on Facebook or texting their friends or otherwise making it clear that their attention is elsewhere. But is it acceptable for a faculty member to deal with these disruptions by walking out of class?

Two years ago, a Syracuse University professor set off a debate with his simple policy: If he spots a student texting, he will walk out of class for the day.

Now two faculty members at Ryerson University, in Toronto, sparked discussion at their institution with a similar (if somewhat more lenient) policy -- and their university's administrators and faculty union have both urged them to back down, which they apparently have.

The Ryerson professors' policy was first reported last week in The Eyeopener (the student newspaper) .... Two professors who teach an introductory engineering course in chemistry jointly adopted a policy by posting it on the courses' Blackboard sites. ... [T]he professors said that after three warnings about disruptions such as cell phone discussions and movies playing on laptops, the professors would walk out of class -- and students would have to learn the rest of that day's material themselves.  ...

The student newspaper described a chaotic environment in the class where the faculty members made the threat to walk out, with loud chatting among students and even paper airplanes being shot around the room. ...

I've never had law students behave remotely this badly. About the most disruptive conduct I've faced is students leaving class, presumably to go to the bathroom. One year I really lost my temper about that and told the class "If you can't hold it for the whole class, buy some Depends." As you can imagine, my evaluations that semester tanked.

Frankly, I'm not at all sure what I'd do if faced with the level of disruption that took place at Ryerson. Walking out seems like the only option. Any other ideas?

Logos and Narrative: The Political Theory Embedded in Genesis through Second Kings

Geoffrey Miller is doing amazing work on studying the Old Testament through the lens of modern legal and economic scholarship. His latest paper is especially interesting:

The books of Genesis through Second Kings trace a history of Israel from earliest times through the fall of the Southern Kingdom in 586 BCE. In earlier work, I demonstrate that this narrative contains a sophisticated political theory – a systematic analysis which justifies political authority; demonstrates the necessity of law and government; explores the nature of power relations in families; argues that nationhood is the best form of political organization; identifies self-governance, centralized institutions and sovereignty as the essential elements of nationhood; and claims that constitutional monarchy represents the best form of national government. But if the bible contains such a theory, why has it not been identified before now? The reason is that the bible’s political theory is embodied in narratives rather than in discursive analysis. The political meaning of the narratives was lost as the bible came to be interpreted from an exclusively spiritual point of view. This paper identifies advantages and disadvantages of narratives and offers conjectures for why Greek thinkers presented their political ideas discursively while the culture of ancient Israel opted to convey abstract ideas in the form of narrative.

Republican Corporate Managers Adopt Conservative Corporate Policies

Interesting paper by Hutton et al. reports that:

Our key conjecture is that financially conservative Republican managers would adopt more conservative corporate policies than managers with Democratic orientation. Using individual-level political contributions of managers as a proxy for their political preferences, we show that managers self-select into firms and industries with political environment that is closely aligned with their own personal political values. Further, we show that firms with Republican managers have more conservative corporate policies. Specifically, Republican managers choose lower levels of corporate debt, lower levels of capital investments, lower R&D expenditures, and pay more dividends. Their cautious investment policies make firms less risky, generate higher profitability, and allow firms to retain more earnings, which in turn reduce corporate leverage. Conservative corporate and local cultures also induce conservative corporate policies, but the impact of managerial financial conservatism is the strongest.

Which is probably why you want some loony lefties like Bill Gates running your start up and some solid Main Street GOPer like George Schultz running your mature multinational.

Abolish Appraisal

Bob Thompson has posted to SSRN an interesting article entitled The Case for Iterative Statutory Reform: Appraisal and the Model Act, in which he argues that:

Appraisal statutes providing minority shareholders a judicially-determined value for their shares may be the Model Business Corporation Act’s most distinctive and creative corporate law product. This article, part of a discussion marking the MBCA’s 60th anniversary, traces the somewhat tortured development of appraisal statutes from their traditional focus on providing dissenting shareholders liquidity in a broad variety of transactions to one focused on conflicted transactions initiated by majority shareholders. The historical liquidity function for appraisal, dating from the turn of the 20th century, simply no longer exists. Delaware, the other primary source for corporate statutes in the United States, continues to have an appraisal statute rooted in this now obsolete context; updating has been left mostly to the courts within ill-fitting statutory language. It took the Model Act drafters several iterations over a long period of years to fully transform their statute, but the result is a more coherent approach and an illustration of the relative advantages that can come from an iterative approach to statutory revision.

I see no useful purpose in the modern appraisal proceeding. As Thompson notes, it has become a vehicle for dealing with some--but not all--instances of majority shareholder oppression in connection with some--but not all--freezeout transactions. Better to abolish appraisal and let shareholders pursue a class action for damages.

Apple's next steps

Charles Stross speculates on Apple's next moves. He anticipates a beefed up iPad and a 7-inch iPad.

As for me, would I buy a 7" iPad?

Well, the full-sized first-gen iPad is the best ebook reader I've ever owned — except that it's heavy. With a case on, it weighs 50% more than a 400 page hardback. What I'd kill for would be much the same guts, squished into a case the size of the Sony Pocket Reader or, at most, the basic Amazon Kindle, at the weight of a paperback (250-400 grams). If you want an ebook platform the regular iPad is comparable to the Kindle DX; however, the iPhone/iPod touch is too small. The current iPad requires a shoulder bag or backpack. A 7" iPad, in contrast, would stick to my pocket like glue, everywhere I go. I'd buy the bottom end model with 8Gb or 16Gb of FLASH and no SIM slot, and I'd use it as an app platform (games and information) and ebook reader.

In contrast, I plan to upgrade to an iPhone 4 and iPad 2.0 when the latter comes out. I use the iPad as an e-reader, but that's probably only 10% of the time. As a replacement for a laptop for email, blogging, web surfing, and so on, the bigger screen (and my aging eyes) and virtual keyboard will be much more useful than a 7-inch version.

The interesting question is whether I'll talk myself into thinking I also need a 7-inch iPad to complete the collection. What would it offer (besides a lighter e-book reader) that the iPhone and iPad don't?

What to do when California goes bust

David Skeel proposes "adopting a bankruptcy chapter for states, similar to the provisions we already have for municipalities, in this little magazine article."

They'll watch “Sarah Palin’s Alaska” so we don't have to

A new service from Frum Forum.

Hart and Zingales on the Fed and Systemically Important Institutions

Dodd-Frank gave the Fed powers to regulate systemically important financial institutions. Economists Oliver Hart and Luigi Zingales have an op-ed on how the Fed should go about identifying those institutions.

I'm in the news again

The Feds must cast their net widely
Financial Times
“That is what analysts do – they try to be first to find information,” says Stephen Bainbridge, a professor at the University of California, Los Angeles. ...

Has your turkey dropped yet?

Hope you're having a great day.

Happy Thanksgiving

Opting out and privacy

Scott Peppet has an interesting post on how opting out of Google Street View has had unforseen consequences:

Various news outlets are reporting that Google “fans” in Germany have been egging the roughly 3% of houses whose inhabitants have chosen to opt out of Google’s Street View mapping feature.

Why?

Apparently the vandals left notes saying “Google is cool.”  So maybe this is just a “how dare you question anything Google?” protest.

But more likely it is something more. Jeff Jarvis on Buzz Machine recently labeled opting out of Street View the equivalent of “digital desecration,” saying that such “embarassing” “assaults” on the public “saddened and angered” him. It seems plausible that these vandals agree; “their” information has been taken from them by others asserting privacy interests, and they’re penalizing those who opt out for denying them what they view as theirs.

As Kashmir Hill put it on Forbes, “[i]t’s ironic that those who wanted more privacy through blurring their homes wound up getting less of it.”  Ironic, maybe. Surprising, not really. I’ve been making the argument here all month that opting out is not a privacy solution in many circumstances, because the act of opting out is itself visible to (and itself conveys information to) others. This is based on my forthcoming paper Unraveling Privacy; I’ve given examples from Mexico’s experiment with biometric retina recognition and from the quantified self / sensor movement. Egging is just a more crude version; in this example, it’s not that those who opted out are the “worst” members of a given pool (as in true unraveling scenarios) and are therefore discriminated against, but simply that others are pushing back against the right to opt out itself because it impedes unfettered access to all the information they want.

Hen then asks "what's next?" and speculates on some possibilities. It occurs to me, of course, that National Opt Out day "is itself visible to (and itself conveys information to) others." Opting out in some settings thus may be less about ensuring privacy and more about publicly protesting the loss thereof.

The uncertain relationship between governance and performance

Over on Twitter, I see a claim that ""there is lots of research now that shows that well governed companies outperform poorly governed ones." Well, yes, but.

In theory, good corporate governance practices should make firms more profitable and productive, in turn contributing to the overall health of the economy. Curiously, however, the evidence for a causal relationship between corporate governance and either firm performance or stock returns is sketchy and conflicting. As Brian Cheffins recently wrote: "Corporate governance is not the primary determinant of share prices, as reflected by the fact that academic testing of the hypothesis that good corporate governance improves corporate financial performance has yielded inconclusive results."

The absence of conclusive evidence for a causal relationship between governance practices and stock returns does not disprove the claim that good governance leads to good performance, of course. Public companies provide substantial—and ever increasing—disclosures with regard to their governance practices. As a result, assuming the capital markets are efficient, those practices should be fully impounded by stock market prices. Only a change in a firm’s governance practices—for good or ill—should result in the cumulative abnormal returns that stock prices studies would identify.

Yet, the absence of conclusive evidence is compounded by findings from the financial crisis that best governance practices were actually associated with poorer performance during the crisis. A study by 3 USC business school professors of 296 financial institutions in 30 countries found that board independence and high institutional investor ownership, which are usually assumed to be good practices, were associated with poor stock performance during the crisis. David Erkens et al., Corporate Governance in the 2007-2008 Financial Crisis: Evidence from Financial Institutions Worldwide (Sept. 2010). They further found that financial institutions with more independent boards were more likely to raise equity capital during the crisis, which ultimately resulted in a wealth transfer from shareholders to creditors. As for institutional ownership, higher levels thereof were associated with greater risk taking, which ultimately resulted in greater losses.

The financial crisis also taught us that what constitutes good corporate governance depends on which constituency’s interests one is seeking to advance. Governance regimes that advantaged shareholders harmed taxpayers.

A bank borrows short term by taking in deposits and then lends long term. This system of fractional reserves, pursuant to which banks retain only a modest fraction of their deposits as liquid assets, makes banks vulnerable to runs. Deposit insurance was developed to help prevent runs by assuring depositors that they would be able to get their money back even if the bank failed, but it created a moral hazard. The presence of deposit insurance reduces the incentives of depositors to monitor the riskiness of the decisions bankers make. If the bank takes on risky trading for its own account, the depositors won't care, because the taxpayer will step in via the FDIC and make them whole (up to a very generous cap). Shareholders won't care because they are protected by the corporate law rule of limited liability. If the deal is profitable, they reap the benefits; if the deal fails, the taxpayer steps in to clean up the mess. The trouble, of course, is that when decision makers face only the consequences of a risk paying off and not those of the risk going south, they take on socially undesirable amounts of risk.

Even financial institutions not part of the deposit insurance regulatory scheme often had artificially low costs of capital that allowed them to take risks that were socially unacceptable. Fannie Mae and Freddie Mac infamously benefited from an implicit guarantee. Although they were nominally private entities, investors and creditors believed that the government would not let them fail. The same was true of truly private financial institutions that had become “too big to fail.” Their creditors and investors believed that the government would bail out the financial system. Hence, they were willing to accept discounted investment returns because they believed the government would make them whole regardless of whether the bank's risks paid off or not.

At the same time we were creating incentives financial institutions to take risks, we were compounding the problem creating mechanisms for shareholders to pressure managers to do so. Performance-based compensation schemes, increased venues for shareholder activism, and the like were all regarded as good practice. But they further encouraged managers to take socially undesirable risks.

In sum, the governance/performance story is more complicated than it might seem.