Posted on by Dan Crane · 1 Comment

Price-fixing Rabbis: Is Antitrust Made for this Problem?

Barak has single-handedly provoked a national dialogue over an interesting and important issue about the relationship between antitrust law and religious organizations.  This is scholarly entrepreneurship at its best, so kudos to Barak.  Alas, I’ll have to part company with his position.  Not having the benefit of his expertise on the specifics of  rabbinical hiring, I’ll make more general comments about antitrust and the regulation of religious enterprises.

Modern antitrust law is justified on the assumption that rivalry between firms for the design, manufacture, and distribution of goods and services promotes efficiency by stimulating innovation and lowering prices.  This assumption is true enough as to commercial undertakings that it serves as a useful market ordering principle.  I’m far less confident that the rivalry assumption holds as a general matter as to religious organizations.

On the one hand, competition clearly can be a spur to the performance of religious organizations.  The best empirical evidence for this is the widely different paths of the state-established churches of Europe and the disestablished churches in the United States.  In Europe, the Lutheran, Anglican, Orthodox, and Catholic churches have held near-monopoly positions for hundreds of years.  Funded by the state and granted all manner of valuable privileges and subsidies, they are economically protected—and in north Europe at least almost completely irrelevant.  Secure in its position and unmotivated by competition, the established church had little reason to sharpen its message, adapt to new social realities, or reach new audiences.  By contrast, religion has flourished in America precisely because of its disestablishment.   America has been the most fertile land for development of new religious sects, doctrines, and expressions, in large part because no group could succeed unless it presented an appealing message and worked hard to attract and retain members.  Europeans who often look with a mixture of contempt, amusement, horror, and incredulity at the deep religiosity of the United States would do well to consult economic principles to understand the differences.

On the other hand, it’s far from clear that rivalry between religions is as fundamental to the well-being of society as is rivalry between commercial firms.  I was recently at a conference where someone asked whether the antitrust laws should apply to the Balamand agreement between the Roman Catholic and Eastern Orthodox Church, which ended official Roman Catholic proselytization of the Eastern Orthodox.  The audience laughed.  Given that much of history’s nastiest episodes have come about because of religious rivalry, gestures toward religious conciliation and ecumenicalism are a relief—even if they happen to take the form of market division.

And that’s as to what the antitrust crowd would call “interbrand competition,” rivalry between different religious sects.  If the value of overt rivalry between religious sects is questionable, so much more so for rivalry within religious sects—what the antitrust crowd would call “intrabrand competition.”  Speaking from within just my own tradition—the Christian one—a good bit of the Apostle Paul’s letters to the churches scattered across the Roman world was about the need for unity, the need to avoid internecine strife, the need to stop competing and to be “unified in Christ.”  Since the church was said to be “one body,” the Apostle would likely have found it surprising that social welfare would be maximized if the churches at Ephesus and Corinth competed with each other to attract Timothy as their next pastor.  To put the point rather awkwardly in the language of modern antitrust, in Christian theology the church is a single firm, and a single firm is juridically incapable of conspiring with itself (as the Supreme Court held in Copperweld).  I can’t speak universally, but my sense is that most religions have a similar commitment to internal unity and harmony.

The fundamental problem with applying antitrust law to the non-commercial activities of churches, synagogues, or other religious organizations is that it forces them to adhere to a set of normative commitments that may not be their own.  An ecclesiastical organization may think it’s far more important to ensure order, theological continuity, adherence to tradition, or harmony in allocating its clergy than to secure the optimal short-run deployment of its human capital resources (i.e., its clergy) given the preferences of local congregations.  I don’t know whether or not it is.  But if I were a judge making the decision in an antitrust case, I would be pretty sure that the question wasn’t my call.  Congregational style organizations exist precisely because their members want control over these kinds of decisions; synodic or hierarchical organizations exist precisely because they value order, theological continuity, adherence to tradition, and harmony over local autonomy.

Thus far, my arguments have been purely normative.  Whether modern U.S. antitrust law applies in the rabbinical case Barak has raised is a different question.  I seriously doubt that the framers of the Sherman Act would have contemplated the statute’s application to churches and synagogues.  To be clear, I’m not suggesting that religious organizations are immune from the antitrust laws when they sell goods or services.  If kosher slaughterhouses collude to raise prices for meat, they surely don’t get antitrust immunity just because the collusion is sanctioned by a rabbinical council.  The Supreme Court has held that the antitrust laws apply when “proximate relation to lucre” appears.  Producing and selling food is a commercial transaction; hiring rabbis or pastors is not.  We hope that the core motivation of the transaction has no approximation to lucre whatsoever—that each party to the transaction is maximizing things other than money.  To force the parties to follow the normative goals of the antitrust laws when it comes to ordering their religious activities fails to  respect to the very reasons that churches and synagogues exist.

Posted on by barakrichman · 1 Comment

Rabbis Following in Cartel Footsteps of Lawyers, Doctors, Engineers, Many Others

First, I thank the CLR for offering its space for an extended discussion of what I think is a critically important issue to many synagogues in America: the freedom to select and hire the rabbi they want.  I confess, however, that this is not a terribly complicated or difficult legal issue. America’s rabbis implement rules that are squarely illegal and are well outside any reasonable First Amendment protection.

Let me briefly describe the organization of America’s Jewish denominations.  Synagogues are independent congregations, governed like any independent nonprofit and like Baptist, Quaker, or other congregational churches.  synagogues hire rabbis just as they hire secretaries, and they pay a voluntary dues to national associations in affiliating with particular movements.  When a synagogue wants to hire a rabbi, however, it confronts a tightly organized labor market.  Individual rabbis are prohibited from seeking employment independently, and instead are required to apply only for jobs through their professional associations.  If they act independently, they are expelled from their associations. Meanwhile, congregations seeking to hire a rabbi must enlist exclusively through the hiring processes sponsored by the rabbinical associations and can only interview the individuals the association sends their way.  I have written about this system in greater detail here and here.

By organizing their individual members, the rabbinic associations are able to leverage their collective power against individual congregations.  This strategy among professionals is nothing new.  The American Medical Association has a very checkered past of instituting similar practices, and until federal antitrust officials intervened had expelled any individual member who accepted employment or payment from early HMOs. Several Bar Associations considered it “unethical” to charge low prices for certain rudimentary services.  Associations of professional engineers prohibited negotiations on price, associations of dentists prohibited its members from working constructive,y with insurers and mother professionals, and the list goes on.  Three similarities persist throughout this history: first, that the professionals expelled members who misbehaved, thereby enabling the association to leverage the entire market of its professional members; second, the association used thus leverage to exploit patients, purchasers of legal services, and other consumers; and third, courts and antitrust enforcers concluded that these practices violated the Sherman Act.

The rabbis are no different.  Their collective dominance allows them to pursue full-employment policies, extract higher wages than other clergy, and stifle innovation and entry from would-be entrants.  America’s synagogues suffer as a result.  Synagogues are contracting, unable to gather the financial resources necessary to sustain themselves; and American Judaism remains ossified in organizational structures that may have made sense in the 1950s but currently are unable to address contemporary needs.  These are the classic harms from a cartel.

So, the practices are familiar and the consequences are predictable.  This is precisely the conduct the Sherman Act is designed to prohibit.  That also means the solution is easy too.

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Schragger & Schwartzman on Religious Institutionalism

Richard Schragger and Micah Schwartzman (both of University of Virginia School of Law) have posted Against Religious Institutionalism. The abstract follows.

The idea that religious institutions should play a central role in understanding the First Amendment has become increasingly prominent in recent years. Litigation over the application of civil rights laws to ministers and the requirement that religious employers provide contraception coverage to their employees have elicited calls for a doctrine of church sovereignty based on an institutional conception of the Religion Clauses. In this Article, we present grounds for skepticism about this new religious institutionalism, especially the concept of “freedom of the church,” which we distinguish from the seemingly related but importantly distinct idea of church autonomy. We further explain why individual rights of conscience are sufficient to protect the free exercise and anti-establishment values of the First Amendment. Our argument, contrary to some recent scholarship, is that religious institutions do not give rise to a special set of rights, autonomy, or sovereignty, and that what might be called institutional or church autonomy is ultimately derived from individual rights of conscience. Indeed, for purposes of understanding religious liberty, we contend that any notion of institutional autonomy — to the extent it exists — can come from nowhere else.

Posted on by Mark Movsesian

CLR Forum Debate: Is Conservative Judaism a Cartel?

Back in August, I posted a critique of Duke Professor Barak Richman‘s argument, discussed in an article in the New York Times, that Conservative Judaism’s process for naming rabbis violates the antitrust laws. Barak responded in the comment box, and it occurred to me that it would be a nice idea to host an online debate on the subject. Professor Daniel Crane (Michigan) has kindly agreed to participate. So, for the next couple of days, Barak and Dan will face off here at CLR Forum. We’re very grateful to both of them and look forward to a lively and enlightening exchange. And the com boxes will be open!

Posted on by JCPW

Harris, “The Serpentine Wall: The Winding Boundary between Church and State in the United States”

This January, Transaction Publishers will publish The Serpentine Wall: The Winding Boundary between Church and State in the United States by James F. Harris (College of William and Mary). The publisher’s description follows.

The Serpentine Wall is chronologically structured, befitting a history of church-state separation in the United States. It begins with a history of ideas approach to the European backgrounds and colonial American experiments in theocracy and freedom of religion. It covers pre-modern American debates about religious freedom among the founding generation right up through the nineteenth century. The final section of the book focuses on the separation of church and state and how this has become a matter determined by the Supreme Court.

The resolution of the proper interpretation of the religious clauses of the First Amendment and the course of the boundary between church and state has been slow. Many changes that took place throughout the nineteenth and the first half of the twentieth century have influenced the increasingly circuitous route taken by the Serpentine Wall between the two. The result has been an increased focus on social issues involving questions of interpretation of the establishment and free exercise clauses of the First Amendment.

The founding of the United States was a unique event in human history and the result of factors that are unlikely to be repeated. To understand the founding of a democratic country with a unique arrangement between church and state, it is important to view that development as both a product of and a departure from what had come before. Harris’ interesting, unique, philosophical viewpoint will be important to those interested in how the roles of church versus state have evolved in the United States.

Posted on by ddrakeman

Things I Thought I Knew — Part 3: The Antifederalists and Religion

 

In the last few decades, the Antifederalists have surged, partially because they look like the patron saints of small government, and, for our purposes, because they have been held up as recognizing the importance of religion for the health of a republic.

“[M]any Antifederalists,” according to Herbert Storing, “were concerned with the maintenance of religious conviction as a support of republican government.” And he should know. Storing was not only the dean of Antifederalist scholars, he created a 7 volume canon called (perhaps over-optimistically), The Complete Antifederalist.  Since Storing’s book is all about the constitutional debates, it’s hard not to assume that he meant that they were looking for ways for the federal government to support religion.

But, what I found perplexing, when I looked into it, is that even he has trouble documenting his statement about “many Antifederalists.” In all 7 volumes, he only has one Antifederalist, Charles Turner of Massachusetts,” talk about the importance of “Christian piety and morals” to the country.  Storing bolsters this statement with a letter by another Massachusetts writer who wasn’t an Antifederalist, and a Virginia writer who wasn’t talking about the Constitution.

To be sure, many Antifederalists did think religion was important to republican government; they shared that belief with many Federalists. The point is that very few Feds or Antifeds thought it was a federal issue.  At the state level, there had been – and would continue to be – battles over just how much the government needed religion. But what is most impressive about looking for religion in Storing’s Complete Antifederalist is that it’s rarely there – just an occasional comment about protecting religious freedom, and a few statements both for and against a religious test for public office.

In short, the Antifederalists – in their discussions of the federal Constitution – really didn’t have much to say about religion.  If they had thought it was an issue, they probably would have had a lot to say.  But it wasn’t, and they didn’t. So anyone who wants to enlist them in a push for more recognition of the importance of religion at the national level must first remember what is abundantly clear from Storing’s collection — that the Antifederalists didn’t want a “national” (a word they hated) government to have power over anything.

Don Drakeman

Posted on by ddrakeman

Things I Thought I Knew — Part 1: Supreme Court Facts

When I was teaching an undergraduate research class on the Constitution, I would sometimes give the students this assignment:  Find a Supreme Court opinion making a constitutional argument that relies on a factual statement.  Then go do the research and see if the facts that are necessary to the argument are accurately stated.  At the outset, I thought the Court’s batting average would be pretty high, but that wasn’t necessarily the case.

Take, for example, the Everson case where Justice Rutledge read the establishment clause in light of James Madison’s Memorial and Remonstrance because of Madison’s “authorship” of the religion clauses and the fact that the First Amendment was the “direct culmination” of the struggle for religious freedom in Virginia.

Does the documentary record support Rutledge’s factual claims about the religion clauses?  The answer, at least in my view, is somewhere between “no” and “not really.”  But this isn’t just an academic research exercise or a chance to say, “Gotcha.”  It’s a question about what makes a persuasive constitutional argument.

This what-are-the-real-facts issue might seem to be narrowly focused on originalist arguments, since they need to cite the historical record showing the Constitution’s original meaning (whether they are “Old” Originalist arguments focused on the framers or “New” Originalist ones about the “public meaning” of the text).  But even non-originalist justices sometimes rely on economics, sociology, psychology and other academic fields.  In those cases, we can ask whether the justices are fairly representing the state of scholarship, or are they engaging in a bit of “law office social science.”

So what if the Court is wrong, or if, perhaps, it over-interprets a bit?  That’s a deeper question, but I tend to side with the distinguished Princeton professor, Edward Corwin, who said (in 1951) in connection with the Supreme Court’s landmark church-state cases, “the Court has the right to make history [but] it has no right to make it up.

Don Drakeman

Posted on by ddrakeman · 3 Comments

Getting Out of Our Grooves — Part 3: Where Does Religious Liberty Come From?

The canonical view of American religious liberty was set out in Justice Hugo Black’s opinion in the Everson case (1947):  A “large proportion” of the “early settlers of this country . . . came from Europe to escape the bondage of laws which compelled them to support and attend government favored churches.”  Religious persecution “shocked the freedom-loving colonials into a feeling of abhorrence,” a feeling, he noted “which found expression in the First Amendment.”  Ultimately, the leadership for our national commitment to religious liberty came from Virginia, since Jefferson’s Bill for Establishing Religion Freedom and the First Amendment “had the same objective and were intended to provide the same protection . . . .”

This classic statement of the Jeffersonian origins of the religion clauses basically says that “ideas have consequences.”  And it’s hard to disagree with that principle in the abstract.  But it is also worth looking at some more pragmatic concerns that led Revolutionary America to embrace a greater level of religious freedom.  As discussed in my earlier blog, religious liberty, in addition to being a good idea, can be a useful strategy for governments seeking to expand or consolidate their power.

Scholars have suggested, for example, that the War itself may have had a beneficial trickle down effect on religious liberty.  Most recently, John Ragosta’s Wellspring of Liberty (2010) shows how Virginia’s dissenters, particularly the Baptists and Presbyterians, negotiated for greater religious liberty from the Anglican-dominated state in return for their support of the war effort.

Meanwhile, Charles Hanson’s Necessary Virtue: The Pragmatic Origins of Religious Liberty in New England (1998) shows how events in Massachusetts, where anti-Catholicism had been ingrained for a very long time, led to a “wartime accommodation” of Catholic France.  Hanson’s story touches in part on the oldest endowed university lecture in America, Harvard’s Dudleian Lecture.  Donor Dudley’s carefully drawn will required that, at least once every four years, the distinguished lecturer would be required to address the following topic:  “The detecting and convicting and exposing the idolatry of the Romish Church, their tyranny, usurpations, damnable heresies, fatal errors, abominable superstitions, and other crying wickedness in their high places.”

And so, while New Englanders had blasted the 1774 Quebec Act guarantying Canadian Catholics the “free exercise of religion,” the colonists’ formal alliance with Catholic France in 1788 led to wartime “accommodations,” including far milder Dudleian Lectures during the war years.  Old prejudices tend to die hard, however, and Harvard didn’t look seriously at changing the anti-Catholic focus of the lectures until the end of the 19th century, a move that we may choose to applaud for its liberalness or to criticize for its violation of the principle of upholding donor intent in charitable giving.

Don Drakeman

Posted on by Mark Movsesian

Hate Speech and Foreign Relations

At Opinio Juris, my friend and former colleague Peter Spiro has an interesting post on recent events in Egypt and Libya. Peter argues that there is a foreign relations rationale for banning hate speech. In a world where obscure YouTube videos like “The Innocence of Muslims” can result in the murder of one of our ambassadors, he says, the US should consider banning such material. He notes that European countries have stricter limits on religious hate speech than we and still manage to have functioning democracies.

As I say, it’s an interesting post. Actually, though, this doesn’t seem a workable solution for the US, legally or politically. First, I don’t think Peter means “hate speech,” which typically connotes speech likely to incite violence against minorities. A ban on “hate speech” wouldn’t have applied to “The Innocence of Muslims,” which was not likely to incite violence against anyone, except perhaps the film’s producers.  I think the category Peter is looking for is “offensive” speech, specifically, speech that would offend listeners’ religious sensibilities. It’s true that European countries are more comfortable than the US with Read more

Posted on by Mark Movsesian · 1 Comment

What Film?

That, I think it’s fair to say, was the first reaction most Americans had to the news that a film insulting the Prophet Mohammad had set off mobs in Egypt and Libya, resulting in attacks on American embassies and the murder of an American ambassador. Apparently, the story is this. A couple of Americans have posted a film on YouTube, the oddly-named “The Innocence of Muslims,” that ridicules the Prophet and the founding of Islam, and also portrays the suffering of Coptic Christians in contemporary Egypt. It’s unlikely the “film” — it’s really more a poorly-done video — would have been seen by more than a handful of internet trawlers, had not Terry Jones, the Florida pastor last known for threatening to burn a Quran, promoted it. Word spread through the Middle East – who knew Jones had a following there? – and, eventually, as one thing led to another, Islamist mobs saw a chance to stoke resentment against the US. And now we see the results.

There will be time to reflect on all of this, but two things seem immediately clear. First, there’s going to be more violence before this episode ends. Some of that violence will be directed against American interests, but most will be directed against the Middle East’s own Christians, particularly Egypt’s long-suffering Copts. Local governments will do relatively little to protect these Christians, and the international human rights community will remain largely silent as well. (Hopefully, the US is getting ready to grant a wave of asylum applications from Coptic refugees, but you never know). In Syria, Assad’s support among Christians will only solidify. Syrian Christians really need no reminder of what is likely to happen to them if the Ba’ath regime falls, but yesterday’s events do underscore things.

Second, whatever happens in this crisis, similar crises are bound to occur in future. As long as America continues to respect the First Amendment, people will continue to make and show films like “The Innocence of Muslims.” In a YouTube age, in which anyone with a video camera and a computer can beam films around the globe for very little money, it will be virtually impossible to restrain them — even assuming it would be legal, which it would not be, to attempt to do so. And, as long as the religious sensibilities of the West and the Muslim world continue to diverge so radically — as long as videos most Americans would dismiss as obscure junk continue to be bloody provocations in the Muslim world — clashes like yesterday’s seem sadly inevitable.