One of the curious aspects of the mortgage taking by eminent domain story is the role of Cornell law professor Robert Hockett. Felix Salmon reports that:
Mortgage Resolution Partners, a politically well-connected firm in San Francisco, was shopping to municipalities the idea of using eminent domain to restructure mortgages. Then, on Tuesday, Cornell University’s Robert Hockett weighed in, saying that the idea was a compelling one. “To solve a collective action problem, we need a collective agent,” he wrote. “That’s what governments are.”
According to Imran Ghori of the Press-Enterprise in San Bernadino, where the idea seems to be furthest along, Hockett “has been working with Mortgage Resolution Partners” but “said he has no financial interest in the proposal”. I don’t really know what that means, but I think it’s fair to assume that if this happens, Hockett is very well placed to make a lot of money from it. So it’s worth approaching the idea with a skeptical eye. ...
As for Hockett, he was paid an honorarium by MRP to write his paper; Gluckstern described him as a consultant to MRP, but definitely not one of MRP’s lawyers. MRP did not see the paper before Hockett published it, but seeing as how Hockett wrote “The Way Forward” with Dan Alpert, one of the key principals behind MRP’s scheme, there was surely no doubt about what his conclusions would be. The disclaimer in Hockett’s paper says only that “Readers should also be advised that the author is disinterested in what he is here recommending, but may subsequently undertake more legal, financial or expository work in connection with the proposals offered and advocated herein.”
All of which raises some difficult ethical issues. Should academics be doing scholarship for which they are currently paid by outsiders? Should academics be doing scholarship that relates to work they may do in the future for pay, especially if they know such work may be coming down the pike? If so, what disclosures should accompany such work? And how should law school promotion and tenure committees evaluate such work? Should it count the same as uncompensated work?
Over at Concurring Opinions, Frank Bowman recently mused that:
To what extent should we as professors sell our academic reputations to act as advocates? ... I have an ill-formed intuition that this sort of thing can be a problem.
One phenomenon that I see with increasing frequency, and that gives me pause, is the participation by academics in writing amicus briefs – and then rounding up signatures from other academics – in cases where the writer may previously have been consulted and paid by a party. The value, if any, of an amicus brief from legal academics is presumably that we provide disinterested expertise on which the court can rely with particular confidence. Moreover, in former times, it could reasonably have been assumed that an amicus brief from a professor was uncompensated labor untertaken out of concern for proper development of the law. But if our arguments are either directly paid for by a party, or follow chronologically a period in which the party paid for our advice, then the value of the amicus is diminished, as potentially is the value of all such briefs once judges begin to suspect that they are not really manifestations of disinterested scholarly opinion.
Of course, the problem is not limited to law schools:
These days, if you see a famous economics professor testify in Congress, appear on television news, testify in a legal case or regulatory proceeding, give a speech, or write an opinion article in the New York Times (or the Financial Times, the Wall Street Journal, or anywhere else), there is a high probability that he or she is being paid by someone with a big stake in what's being debated. Most of the time, these professors do not disclose these conflicts of interest, and most of the time their universities look the other way. ...
The sale of academic "expertise" for the purpose of influencing government policy, the courts, and public opinion is now a multibillion-dollar business.
Personally, I quit doing consulting and expert witness work six or seven years ago precisely because I too had "an ill-formed intuition" that there was something sleazy about getting paid to put my academic reputation on the line for the specific benefit of private actors. All too often, I felt my name and expertise were being used by people engaged in some form of private rent seeking. Today, my income comes pretty much exclusively from salary and book royalties. So if I take a position (here or elsewhere) it's because I believe it, not because I'm getting paid to say it. That way, the only reason there will ever be "no doubt about ... [my] conclusions" is that a long-time reader will have been able to guess them based on the legal and political positions I've taken in the past. And it will never be "fair to assume that" I am "very well placed to make a lot of money" by having taken that position.
At a bare minimum, the conflict of interest inherent in these situations requires disclosure to one's university employer and to the readers of one's scholarship. In business law, moreover, disclosure of a conflict of interest is not enough. An agent with a conflict of interest must not only disclose the conflict, the agent must get approval from the employer before undertaking the conflicting activity. In my book, that means that before an academic gets paid to "testify in Congress, appear on television news, testify in a legal case or regulatory proceeding, give a speech, or write an opinion article," the university ought to make a determination whether the activity in question passes ethical muster.
I also think you shouldn't be able to double dip. If you get paid (ex ante or ex post) by an outsider in connection with an article or other scholarly work (other than things like endowed lectures and so on), that article and any of its fruit should not be counted towards tenure or promotion. If you want to get scholarly rewards, it should be for having done impartial scholarship.
Better yet, maybe scholars should only testify in Congress, appear on television news, testify in a legal case or regulatory proceeding, give a speech, or write an opinion article" for free.
