Progressive Tax, Progressive Problems

We are in the heart of budget season, and a particularly contentious one at that. This of course leads to the inevitable discussion about taxes. When times are rough, we should be focused on removing the portion of income that government takes from individuals. I don’t care who you ask; the $2730 per person ($819B/300M) the government is prepared to spend could be put to better use by the individuals from whom it is being taken. I, for example, could afford to buy my casebooks for this whole school year and pay a month of rent. People would put money into the industries that really need it: retail, banking, real estate, automobiles, etc.

But I digress. My post today isn’t about the financial wisdom of the bailout bill. It’s about our system of taxes.

I, of course, truly morally oppose income taxation. But for the sake of discussion, I won’t propose abolishing the income tax at all. I’m just going to propose a way to achieve our stated goals.

In my Income Tax class, we pointed out that there are three principles to which the tax code tries to adhere. Progressivity, or vertical equity is one (why they use the word “equity” for an inherent inequality is beyond me). The second is horizontal equity between individuals or married units. Third is neutrality between remaining single and getting married.

This discussion is based on the terms “marriage penalty” or “marriage bonus.” The idea here is that persons may have an economic incentive or disincentive to get married or work once married. The marriage penalty occurs when two individuals of roughly equal income get married. Individually, they would be in one income bracket (say 15%), so if they file independently, they would pay a total of 15% in taxes. However, their combined income pushes them into a higher tax bracket, perhaps 20%. Just for getting married, there is a 5% penalty.

Before we go on, yes, I realize I am simplifying this and not including a broad number of things, including progressive marginal tax rates and tax credits. I’ll come back to that momentarily.

As you can see, in our current system, we can achieve the first two principles, but fail on the third. We are not neutral between being single and being married. But at least we have achieved progressivity and horizontal equity.

Lawmakers often talk of “eliminating the marriage penalty”. The way they do this, as the Bush tax reforms attempted to do, is to adjust the width of brackets and play with tax credits and deductions. That may achieve near neutrality, but it screwed up the second principle. Now we treat married units who file individually different than married units who file jointly.

The truth is, there is no way to achieve both horizontal equity and neutrality between married persons and single persons. At least, not by staying in the tax system that we have had for the last hundred years. The more you try to create neutrality, the less equal you make the system. Like a balloon, you squeeze one and expand somewhere else.

My cynical nature says that politicians want it this way. First, they can all stump on removing the marriage penalty, thus sounding like people with good family values. But they don’t fix it wisely. They try to achieve their goals by adding other deductions and credits, further complicating the tax code. And as we all know, it’s so confusing right now that even the people writing the tax code (I’m talking to you, Barney Frank) and other politicians (you too Daschle, Killefer, and Geithner) can’t figure it out.

Of course, there is one way to simplify the tax code while still achieving equity and neutrality. Of course, it’s the one that few politicians actually talk about. Why not tinker with the first principle: progressivity? After all, whereas equity and neutrality should be goals of every good government, progressivity isn’t exactly something about which people revolt. “Darn you, George III, why won’t you tax rich people at higher rates than me?!?!”

Let’s assume that you have a flat tax of 10%. If people combine their incomes at marriage, they still will pay only 10%. If you decide to stay single, you still only pay 10%. If that couple over there pays 10%, this couple over here will pay 10% too. We have achieved equity and neutrality while sacrificing only this antiquated notion of progressive rate structures. 10% is 10%, no matter who you are or how much you earn. Even Tim Geithner could figure that one out.

Yes, there could still be tax credits that would have the effect of a progressive tax code. The EITC and Child Tax Credit could still exist. Poor people could still get perks in the tax code that just aren’t available to the wealthy. But at least we could say we are trying to be equal while still doing something about it.

Of course, such a system would require the government to spend less. I could talk about that for months. But I won’t. Government should have to spend less. But whether you agree with me on that point or not, I hope we can see eye-to-eye on a flat tax and eliminating the prejudicial, archaic, biased progressive tax system.

One of my friends once tried to defend the progressive tax system by using a logical fallacy. “Progressive means moving forward, achieving progress. You don’t want to be moving backwards do you?” Fallacy aside, the progressive tax doesn’t move us forward or achieve progress. It means that people are treated differently based on their income. Just because it’s the reverse of what most people think of as income discrimination doesn’t mean it’s any less invidious. Reverse-racism is just as bad as racism. We should focus on treating all Americans equally before the law.

After all, that’s what we were founded on.

Thoughts on Election Day 2008

Well, I just got back from voting. No, I didn't vote because of the hundred and twelve pieces of junk left on my door by certain campaigns. I voted because I always have, and always will. I pride myself on doing the research on everything on the ballot. I pride myself on never voting for only one party. I pride myself on thinking about the public questions, and analyzing decisions by the judges up for retention. Yes, I love voting, because it's the reason my ancestors came to this wonderful country.

That said, I disagree fundamentally with the "duty to vote" that we keep hearing about. Voting is a right. Not a fundamental right, since it can be taken away. But nowhere is there a duty to vote. It is a disgusting campaign tactic to get people to mindlessly support the candidate of the day. They say, "If you don't vote, your voice won't be heard." That's right, but my mom always said you should think before you speak, and a lot of voters don't.

Today at my polling place, a woman came into the booth beside me and immediately asked for assistance. She asked the assistant if she could vote for just one party. Of course the assistant pointed out the straight ticket buttons, and reminded the woman that there were several other things on the ballot that weren't ticket items: judicial retention, public questions, and races that are non-partisan here in Monroe County. "No," the woman said, "I just want to vote for the democrats today."

This is what is wrong with American voting mentally today. It doesn't matter if she blindlessly supports Democrats, Republicans, Libertarians, or anyone else. The problem is that she isn't taking the time to think anything out. She's ignoring public questions. She's ignoring the judiciary. All she cares about is putting her party into office. That is stupid voting.

I propose that we eliminate the straight ticket buttons. If you want to vote for all one party, you can take the minute and a half to push their individual names. But at least then you'd have to go through the seven pages and answer the damn questions. See what it is you're voting for. Think for five seconds about whether assessments should be run through the township or the county.

My biggest problem with this woman and voters like her is that she ignored the public questions. She obviously supports "democracy," and yet she chose to ignore the one area where we are democratic. No, we vote in a republic in almost all ways. Our representatives makes the laws, not us. The closest thing to actual democracy we have in this country is public questions. We the people make the law. Incredible. But she doesn't care. No one does.

And that is the problem.

Election 2008: Texas Turns... Yellow?

As some will know, I am a pretty big supporter of third-party rights in this country, believing that both of the two major parties are in need of some serious revision. So I was delighted to hear about a suit filed in Texas by Libertarian Party candidate Bob Barr, contesting the presence of John McCain and Barack Obama on the ballots in November.

According to the campaign's press release:

"The seriousness of this issue is self-evident," the lawsuit states. "The hubris of the major parties has risen to such a level that they do not believe that the election laws of the State of Texas apply to them."
Texas election code §192.031 requires that the “written certification” of the “party’s nominees” be delivered “before 5 p.m. of the 70th day before election day.” Because neither candidate had been nominated by the official filing deadline, the Barr campaign argues it was impossible for the candidates to file under state law.
"Supreme Court justices should recognize that their responsibility is to apply the law as passed by the Legislature, and the law is clear that the candidates cannot be certified on the ballot if their filings are late," says Drew Shirley, a local attorney for the Barr campaign, who is also a Libertarian candidate for the Texas Supreme Court.
A 2006 Texas Supreme Court decision ruled that state law "does not allow political parties or candidates to ignore statutory deadlines."

It's true that too often, the two major parties break election rules and allowed to get away with it because both parties violated them. Essentially, why would McCain complain about Obama breaking a law, when he knows that Obama will do the same thing right back to him? This is an example of why multiple parties keep the election process [more] honest. Smaller parties are forced to know the election laws forwards and backwards, because they have to follow every letter to survive the attacks the major parties put on them (see, for example, the removal of Barr from the West Virginia and Connecticut ballots).

Other states have kicked Barr and others off the ballot because they did not meet filing deadlines. If it's fair to remove candidates for failing to meet deadlines when they represent minor parties, then turnabout should be fair play. If I were a resident of Texas (or any other state that placed their deadline earlier than August 27, the day the Democrats officially declared Obama their candidate), I would be tremendously offended that the major parties thought they were more important than my state's laws.

Of course the point of deadlines so early is to make certification for minor parties extremely difficult. But if the major parties are too cocky to read the rules of every state, then the Secretaries of State for the various states should boot the punks off their ballot and let parties that know how to read appear on the ballot.

Of course I'm not hopeful for the success of this lawsuit. The judges in Texas are elected on a partisan basis, so they owe a debt to their parties. And when it gets appealed up, the judges were all appointed by partisan elected officials, so they still owe a debt. Not quite fair, I know, but it would be nice if judges would simply read the law and apply it equally in all cases. Either they filed by August 26 or they didn't. Risk getting kicked off the bench to do the right thing.

But as we all know, "...some are more equal than others."

Public Understanding of Bankruptcy Law

I'm deep into this semester, and my schedule is quite heavy. In addition to coursework in Constitutional Law, Criminal Procedure, Secured Transactions, Federal Criminal Law, and Evidence, I am in the depths of Moot Court (and that is all I'm allowed to say about Moot Court, apparently) as well as representing the student body as a member of the Indiana University Student Association. That would explain why I haven't blogged since I got back from the ABA Annual Meeting in New York (which, incidentally, was one of the most enjoyable law-related activities I have yet to participate in).

There is no doubt that the press sometimes picks up stories about the law and frames them in the context of "Judge is evil for enforcing law X". Sometimes I agree; the law in question is sometimes abhorrent and should be overturned on Constitutional grounds. Even better, here in Indiana, let a jury find that the law is something other than it seems to be. But other times, the press is making something sound horrible without considering anything in the world of the law.

Today the AP picked up a story about a bankruptcy court ordering a victim to pay back a thief. The story begins:

Mark Poveromo feels ripped off twice over. A judge ordered him to repay money he collected from a builder convicted of stealing from him — and told him to kick in the thief's attorney fees and court costs, too.
Some legal experts say the case, in which a criminal case in Connecticut intersects a bankruptcy judgment filed in St. Louis, shows a need for Congress to revise the nation's bankruptcy laws to better treat people who are awarded money as part of ruling in a criminal case.

Apparently, the builder stole a lot of money from Mr. Poveromo. Then, two months before being convicted, the thief declared bankruptcy because, well, he was bankrupt. The thief paid off a large portion of the stolen property. Then the bankruptcy judge took it back because, as we all know, Article 9 of the U.C.C. says unsecured creditors are on the bottom of the totem pole (nevermind that the reporter never mentions the law behind this judge's reasoning... just make the judge out to be a jerk).

Now, a few months ago I may have thought to myself that this is completely unfair; a miscarriage of justice! But I've taken a few weeks of Secured Transactions now, and, unlike the general populace, I won't fall for this reporter's trickery.

The story advocates altering the bankruptcy code to allow victims of crimes to essentially become secured creditors after their judgment. As the law exists now, as Mr. Poveromo puts it, "Crime does pay." Obviously, this would be a hard law to write. Why limit the law to protect only victims of crime? If your legislative intent is to protect victims, shouldn't every victorious plaintiff in a tort claim be granted this secured status? And what makes a victim more important than a commercial lender? After all, if a new class of secured parties suddenly appears, lenders will be less likely to grant loans (because they will be in a worse position), or at least will demand higher interest rates to compensate them for the additional risk.

Do I feel bad for victims who, unfortunately, don't get the protections of Article 9? Sure. They've been wronged, and they deserve restitution. But why should we put them above commercial lenders, or anyone that was wise enough to get a security agreement? Mr. Poveromo's lawyer should have done enough research to know that the thief had filed for bankruptcy.

Of course, my biggest complaint here is the reporter who covered this story. He should have at least put the judge's reasoning in the article instead of making judges out to be evil dictators taking money from victims to compensate thieves (or, as one law professor was quoted, making "outrageous decision[s]" and executing a "miscarriage of justice"). If the populace feels judges are acting improperly, the press is certainly responsible for leading them in that direction.

The Real Reason for Number Two

The past few days have given the blogosphere much to talk about in regards to the Supreme Court, and in due time I plan to get to the ones I care about. The one that I care the most about, Heller, is the main focus of this post.

For the past 28 hours or so, I have seen plenty of status updates from friends who are upset by the ruling, wishing that it could have been decided after some of Obama's appointments were on the Court. Completely disregarding the chickens-hatching time quandry presented there, I can't help but ask my friends where they put their copy of the Bill of Rights. In case you lost it, the words "shall not be infringed" are still there.

One columnist in northern Indiana posed this question: "If our forefathers lived in 21st century America - with its ungodly crime and murder rates, its wealth of deadly weaponry, and its attempt to interpret a document written more than two centuries ago - would they be celebrating or castigating Thursday's landmark ruling?"

I'm fairly certain the answer to that question is an obvious "celebrate, but with hesitation". Yes, they would have been quite pleased with the outcome of the case. They would have been less pleased that an originalist believed that there are some acceptable firearm regulations.

Certainly the Second Amendment refers to a militia, like the National Guard in New York, or the entire population in Indiana. Taking weapons away from a militia would be counter-productive and wonderfully ironic. The concept of a universal (all free white men) militia can be traced back to at least 12th century England. But the more vital American interpretation of the right to bear arms became abundantly clear during the years preceding the American Revolution.

The British government couldn't help but notice those pesky colonists arming their militias while talking about how much they disliked the Crown. Parliament sought to disarm their militias, despite the Declaration of Rights and the common law right to self-defense. Conveniently, they had no problem with the right to self-defense (in fact, John Adams used the defense in the Boston Massacre trials), just with colonists possessing firearms.

It was those very firearms that allowed Americans to throw off the chains of British rule. The newly formed United States owed their freedom to their firearms. So they enshrined their right to firearms in their most important document, the Constitution.

This leads me to my main point, that the real reason for the Second Amendment was not solely to arm and regulate a militia. Yes, we wanted our citizens armed in case Britain, or Canada, or Mexico, or anyone else, tried to invade (indeed, this may have been the primary reason Congress passed the Second Amendment). But the reason the States ratified the Second Amendment was because they remembered the oppression of the last all-powerful government. Their firearms were the only thing that saved them.

Yes, the main reason to support the Second Amendment is because, if and when our government becomes too oppressive, our firearms will be the only thing stopping them from crushing us. When the firearms go, so too does the rest of the Bill of Rights. The Second Amendment is the one the ensures the rest.

Freedom to Spank your Brats

On Tuesday, the Indiana Supreme Court ruled in Willis v. State that parents have the legal right to discipline their children physically, even if it leaves marks or bruises. In the case, the defendant was a mother of a son who had a history of lying and stealing. The boy stole some of his mother's clothes and gave them away at school. As a punishment, the mother struck him five to seven times with a belt. The school nurse saw the bruises, the son told the nurse from where they came, and the nurse called the police, who charged the mother with battery, a D felony.

Corporal punishment is sometimes acceptable. The Model Penal Code says so. The Second Restatement of Torts says so. Blackstone says so. Heck, the last four thousand years of human history says so.

It is a sad state of affairs that any time a parent tries to punish a child, the state thinks it should come to the child's aid. How long has this been going on? When did we become a nation of wimps? The sad truth is that American kids feel entitled to do whatever they want, and they have been too eager to complain to authorities when they get a spanking. Is it any wonder that, as the Fort Wayne Journal Gazette reports, Indiana is 6th in the nation for juveniles locked up? When parents don't punish appropriately, the law will eventually have to.

I don't mean to suggest that child abuse is acceptable. I have seen many CHINS cases this summer, and there are some parents that really are doing it wrong. And punishment that leads to permanent or severe injuries should be, and is still, illegal. But I am glad to see that Indiana is taking a step back in the proper direction of letting parents punish their children as they see fit.

In re Marriage Cases

A friend asked me today what I thought about the result in the recent California Supreme Court decision overturning the same-sex marriage ban in that state.

I must admit that I'm somewhat torn. On one hand, I don't like courts stepping in to overturn the will of the electorate. Prop 22 passed, and that seems to suggest that at least half of Californians didn't want same-sex marriage recognized by the state. However, the legislature twice passed bills legalizing same-sex marriage that were vetoed by the governor (who, incidentally, said that if they wanted gay marriage, then they would have to take it to the state Supreme Court). So "the will of the people" here seems a bit cloudy.

On the other hand, as any long-time reader of this blog could tell you, I am a pretty big supporter of gay rights, and I do personally believe that if government recognizes marriage at all, it should do so for any type of couple (not that I believe that government should be in the business of recognizing marriages). To me, it seems like most arguments against same-sex marriage are based on religion, which makes me squeamish in government. In fact, very few counterarguments that I have heard when debating this topic end up relying on anything other than morality.

I don't feel like beating this to death right now, mostly because I have made my position very clear in the past, and because the rest of the blogosphere seems to be discussing it just fine without me. For a particularly interesting set of discussions, try looking at the Volokh Conspiracy's stream of posts. So, to answer my friend's question, I agree with the general outcome of the case (giving the right to marry to gays) but disagree with the method (in court, rather than democratically).

Two Tidbits from the News

I know it's been a while since I posted, mostly because of Spring Break and a variety of other scheduling conflicts. But two tidbits from the news really caught my eye and I think that they are worth mentioning here.

Today's Indianapolis Star reports that Governor Daniels has used his first veto of this session, something he has done only seven times in office. I must say, he saved it for a good one. The bill: HEA 1210. The premise of the bill: allow a loophole for individuals who do not pass the teacher's licensing exam to still become teachers in Indiana. Easily one of the dumbest bills passed by the General Assembly this session.

Now, as anyone who has been reading this blog for a long time can tell you, I am no fan of public education. But if you're going to have public education, then it would best for your teachers to have some sort of standard. This bill would have allowed persons who fail the test to become teachers by showing that they had a good GPA in their education coursework and have good references from those under whom they student taught. If that's not lowering the standards, I don't know what is.

The bill was authored by Rep. Vernon Smith (D-Gary), who complained after the veto that the governor hadn't met with him to discuss the bill. I don't blame the governor. He has better things to do than argue about pointless bills. I can understand why Rep. Smith wants the bill: Gary schools are a dismal failure, and they can't get teachers to teach there. He probably thinks that lowering the standards of licensing will mean more teachers in Gary. Well, Mr. Smith, even if your plan worked, it wouldn't improve the education quality in Gary. You need qualified, talented, devoted teachers to come to Gary, not the people who couldn't pass the test. A better plan would be to pay teachers better.

In other news, a student at UVa-Wisa was expelled because of prose he composed in a creative writing class. His story involved a student who dreams of killing his professor and commits suicide. Okay, maybe I could see some threat here, but you need to consider the context. Nevermind that this is a creative writing class, and creativity doesn't always fit nicely into a pre-approved box. The student is an Iraqi war veteran with no history of mental illness and medals for good conduct. In fact, the school couldn't put together a case, except for the fact that the student had a few guns in his car. Okay, again, maybe I could see some threat here, but consider that he had a right to carry them, as he had permits for each of them. And he's a war veteran.

To make matters worse, the school involuntarily committed him for psychiatric testing, something that automatically revokes his ability to hold the gun permits. Well, that's one way to get around the law.

Eugene Volokh points out that "expulsion would still strike [him] an excessive remedy; nor would protecting the university from the possibility that he would turn into a Virginia-Tech-style mass killer justify this: If he really does plan to commit mass murder, he could do that as an expelled student pretty much as easily as an enrolled student (since the school doubtless doesn't have guards at each possible entrance to keep him off campus)."

I would love to use a case like this to get the issue of gun bans in schools brought before the Supreme Court. To me, it is ridiculous that a Constitutional right stops being a right when you cross an invisible barrier onto a campus. Only problem is that this case is not the one I'd bring up. Justice Scalia's son was the professor of that creative writing class. Scalia would have to take a breather on this case, which would leave us 4-4, which is unacceptable. On the plus side, such a lawsuit would encourage the legislators in Indianapolis to pass a bill allowing certain persons to carry firearms on campus.

2008 General Assembly Series: SJR7 and the Waste of Tax Dollars

Anyone that has read my post from last February regarding SJR7, the so-called "Indiana Gay Marriage Ban", knows how I feel about the bill. I think it is a broad overreaching of the state government into the private lives of individuals and an attempt to codify bigotry in our most important document. Those opposed to the thought of same-sex marriage can be comfortable that Indiana law still prevents the marriage or civil union of two persons of the same gender. A constitutional amendment is just one more way to ensure that future generations can't become less bigoted than the current one.

I applauded last year when the bill died in the House. But the bill has again passed the Senate, with a vote of 39-9 (practically the same as last year). The bill is stalled in the House, and it looks ready to die at the hands of House Democrats again. That is, unless Rep. Eric Turner (R-Marion) has his way, and manages to have it attached to the same bill capping property taxes. That just shows the shady dealings that go on in politics: attaching a frivolous and hateful bill to one for which the people are desperately crying out.

The arguments for this ban are same arguments we heard for decades regarding interracial marriage. Anti-miscegenation laws were in place since the beginnings of this nation, often appearing in state Constitutions. Loving v. Virginia, 388 U.S. 1 (1967), was the final nail in the coffin of those racist laws. There, the Supreme Court reversed a trial judge's decision that a black woman and white man could not enter the state without being subject to arrest. The trial judge showed his true colors when he stated, "Almighty God created the races white, black, yellow, and red, and he placed them on separate continents. And but for the interference with his arrangement there would be no cause for such marriages. The fact that he separated the races shows that he did not intend for the races to mix." Id. at 3. In other words, interracial marriage was "unnatural." This argument sounds familiar.

It took 103 years, but South Carolina finally removed the prohibition on "marriage of a white person with a Negro or mulatto or a person who shall have one-eighth or more of Negro blood" from its Constitution in 1998. How sad that such bigotry was written into a Constitution for so long. It casts a shadow of shame on the people of the state. Now Indiana wants to do the same.

If the state wants to ban gay marriage in statutes, and that is the will of the people, so be it. Not all of us may agree, but such is the way of politics and legislation. As I stated in my previous post, amending the Constitution really is not something we should do lightly. And besides, haven't we got more important bill to pass right now?

Occam's Tax Code

Not so long ago in Torts, we discussed Occam's razor as it relates to strict liability. The razor is the 14th century principle of lex parsimoniae; that is, that, all other things being equal, the simplest solution tends to be the right one. What followed was a delightfully intellectual discussion that does not need repeating here. Rather, it made me think about all the places in life that the razor would make life that much better.

As we get into election season (not that today is any different than the last eight months), it occurred to me that my vote should go to the one who follows the concept of the razor most closely, specifically regarding the tax code. The version just recommended by Charlie Rangel (D-NY) had tortious action performed upon it by CNBC, and rightfully so. Even though it keeps the AMT at bay, and reduces top corporate taxes, it raises taxes elsewhere (for example, a 4% surtax on all AGI over $200,000, which I suspect several of my readers make or will be making). In fact, as the report from the Tax Foundation states, "almost all of the 90 million taxpayers whom Rangel claims would pay less under his tax plan would still end up paying more to Uncle Sam in 2011 as a result of the tax cuts' expiring."

Fortunately, it's unlikely that this bill will pass before 2009, and then only if a Democrat takes the White House. For that reason, this goes as a large point in the "con" column for voting Democratic. I still put my support behind Ron Paul (who, incidentally, will be on the Tonight Show tomorrow), because it seems that his tax code is the most Occam-like. Simple solution indeed.

Oenophiles rejoice!

One of the great perks of being situated in south-central Indiana is that I happen to be in wine country (as much as one can have in this particular climate). There are several wineries in the Bloomington area, and I have to believe that their presence brings Indiana Law a wealth of connoisseur law professors.

Ironically, Indiana is a harsh place to be an oenophile. The state is in the pockets of the large alcohol distributors, providing that we can't import wine from out of state, and, until recently, couldn't even have wine from Indiana wineries shipped to our homes (today, the restrictions on wine shipping are still extremely harsh). As a result of this environment, several lawsuits have been brought in an attempt to loosen the grip of these distributors. Fortunately, the biggest wine lovers I know are all law professors.

One such professor, Patrick Baude, was recently involved in a suit, and today the court ruled in his favor. I'd love to summarize the decision, but aside from its length*, I'd hate to screw up briefing a professor's case. If and when I have Professor Baude again, I'd hate for that to be hanging over my head.

"This litigation challenges the constitutionality of Indiana laws that allegedly restrict the ability of wineries, and out-of-state wineries in particular, to sell their product directly to Indiana residents, primarily by orders placed by telephone or over the Internet."

Preventing out-of-state wineries from shipping to Indiana residents violates the Commerce Clause. The defendants, the Indiana ATC and one of the wholesalers, say that the restrictions are there "for the children". Poppycock, says the court (not in those words, of course).

The gist of the decision:
"[T]he court finds the wholesale prohibition, Ind. Code § 7.1-3-26-7(a)(6), to be unconstitutional insofar as it bars wineries that possess wholesale privileges in states other than Indiana from seeking a Direct Wine Seller’s permit. The court also finds the requirement of an initial face-to-face transaction between a winery and customer prior to direct shipment, as described in Ind. Code §§ 7.1-3-26-6(4), 7.1-3-26-9(1)(A), to be unconstitutional. These two conditions constitute a form of economic protectionism and violate the Commerce Clause of the Constitution.

"The court does not find Indiana’s general prohibition of direct shipping, Ind. Code Ind. Code § 7.1-5-11-1.5, to be unconstitutional except with respect to the two specific conditions in the statutory provisions cited above. Nor does the court find the statute allowing an Indiana farm winery to sell its product onsite and at certain other locations, Ind. Code § 7.1-3-12-5, to be unconstitutional."

Not a complete knock-out win, but definitely a step in the right direction. So on this night, I propose a toast to Professor Baude and his success in this litigation. Congratulations!

*Please note, Professor, that I did actually read the whole case. I just didn't think my readers wanted the details.

Always Say "No"

One of the first things I did when I started studying law in depth was to fill my younger brothers in on their rights as American citizens. Like all good lads, they drive cars and may occasionally speed. Such speeding might just bring about an officer of the law, who might just ask them questions not relating to their driving at all. And what did I tell my brothers?

"Always tell them no. Ask for a warrant, and don't let them touch the inside of the car, or any part of your person, without seeing one."

It may not make you popular with the police, and it may cause even more of a delay in your busy schedule, but that's the high price of having rights. I don't suspect that either of my brothers would be in possession of anything illegal. Then again, if they were, I would hope that both would be smart enough to demand a warrant. Letting them know that police sometimes act "unscrupulously" was my job as their older brother.

Thanks to a commenter on my last post, I was alerted to yet another wrongdoing in my great state. There's just something about law enforcement in Indianapolis and their thinking that they can throw the net wide.

As DailyKos describes, federal agents working for the TSA, including Air Marshals, took up base at two bus stops in downtown Indianapolis and set up random checkpoints to pat people down, look in bags, and perform "behavior" tests for the stated purpose of finding weapons and people who were a threat to public safety.

Never mind the fact that there have been no federal crimes occurring on Indy buses. Never mind that Indiana allows anyone with a concealed carry permit (from any state) to carry a handgun legally. Never mind that citizens weren't informed that they could opt out (so that the searches weren't in violation of the Fourth Amendment).

DailyKos has some alarming first-hand accounts of the searches, as well as a far more detailed account than what I can give. Sadly, the Indy Star managed to keep the story to a few lines near the middle. At least this time the comments seem to agree with the general legal consensus.

So, little brothers, I add on to my previous statement. You should also say no to any federal officer demanding to search you anywhere that's not an airport or the White House. In fact, you might want to just steer clear of Indianapolis until the ACLU takes care of this.

WW You D?

Hypothetical situation:

You're a law student. You're spending your Friday night at a local bar listening to a band. As you and your friends "bang your hair" to the sounds of the 80s, you see two bouncers removing another patron of the establishment. One bouncer has the man by the neck; the second kicking the guy's feet and pushing them along. The patron has a look of confusion and shock. The bouncers throw (literally) the guy out of the fire exit, and proceed to kick the guy several times in the ribs before closing the door. What do you do?

A) Walk out the door, help the patron up, and offer your advice on torts.
B) Tell the bouncers that they were out of line (and prepare to be strangled and kicked yourself).
C) Contract local police to a gross abuse of power by the bouncers.
D) Stand quietly by and watch someone get treated like crap.

The Week in Ridiculous Legal News

One of my biggest pet peeves is government hypocrisy. You know the type: you can't own guns but we can, you can't grow marijuana but we can, you can't generate nuclear power but we can. Well, this story out of Pennsylvania really has my gears grinding.

At a routine traffic stop, a police officer noticed that a passenger in the stopped vehicle had a video camera and was taping the interaction between the officer and the driver. The camera was originally off, but when the officer yelled at the driver, the friend thought to himself "maybe this cop isn't following all the rules" and started taping. After the officer took the camera, half a dozen more police officers showed up and arrested the teen for illegal wiretapping. In Pennsylvania, it seems, any recording of another individual without their knowledge is wiretapping.

This raises all sorts of issues with me. First of all, the patrol car has a video camera recording audio and video from every traffic stop. The police can tape you, but you can't tape them. Beyond that, though, I think officers ought to act in a way that suggests that they could be getting taped at any time. It is the responsibility of ordinary citizens to keep the government in check, and tapes of police beatings and other police misconduct often result in a cleaner police force. I'm thinking specifically of a video of an off-duty cop beating a bartender half his size in Chicago a couple months back. Government creating laws that can be used to subvert an honest check of government power is downright wrong.

In other ridiculous legal news, strippers in strip clubs apparently can be too naked. 14 dancers were cited for excessive nudity. In California of all places. Nothing against California or anything, but you would think a lovely liberal paradise would realize that the purpose of a strip club is to, I don't know, see naked people. Haven't the police got better things to do? And what happens to the club after these women (at least, I assume they were women) were released? It gets hit with a possible administrative review by the Department of Alcohol Beverage Control. So, was the liquor what made the dancers get naked? Or was it the sweaty singles? California, you confuse me.

Gas Out! Or: How I Learned to Stop Worrying and Love the Gas Companies

Did you buy gas? In case you were unaware, today is an official boycott on gas. Someone on the internet declared it, and it became law. Several times today I was reminded not to buy gas, and an e-mail circulated through the company. I think most of the things I've read have been similar to this, so I reproduce it here for discussion:

Don't pump gas on May 15th!!!

In April 1997, there was a "gas out" conducted nationwide in protest of gas prices. Gasoline prices dropped 30 cents a gallon overnight.

On May 15th 2007, all internet users are to not go to a gas station in protest of high gas prices. Gas is now over $3.00 a gallon in most places.

There are 73,000,000+ American members currently on the internet network, and the average car takes about 30 to 50 dollars to fill up.

If all users did not go to the pump on the 15th, it would take $2,292,000,000.00 (that's almost 3 BILLION) out of the oil companies pockets for just one day, so please do not go to the gas station on May 15th and lets [sic] try to put a dent in the Middle Eastern oil industry for at least one day.

Now, being a person with both an economics background and a little thing called common sense, I know that this is completely and utterly pointless. I hate to the be the one to burst the bubbles of the thousands of American youth that think that they have the whole system figured out, but then again, bubble bursting is a specialty of mine, so let's go ahead and get started.

First of all, more people drive than internet users. To be effective, a boycott would need everyone to get together on this. By limiting your rallying cry to internet users (who, perhaps, spend more time at home or the office and thus drive less), you limit the effects of any boycott.

Then, the author goes on to list the number of internet users. Wow, 72 million internet users... now that is an impressive number. That's almost a quarter of the population of the U.S. But, oh wise prophet, you forgot to account for the fact that a large portion of those who use the internet aren't even yet of driving age. And those between 16 and 18 might still get gas money from mommy and daddy, thus not caring about the cost of a tank of gas. I recall that when I was in high school, I got a gas card. When gas first hit $1.50 (oh, those were the days), I didn't care. My parents picked up the tab. My brother now has the same deal. If gas goes up the $5.99 a gallon, he will be relatively unfazed. The world goes on, and we still need to get there.

But, for the sake of argument, let's assume that the 73 million are all driving age adults, who each drive one car, and like to drive a lot. Hell, maybe they all drive silver American sports cars that drink gas like their owners drink gin and tonic on the rocks with a twist of lime. Now we get to some cold hard numbers. First of all, 2.29 billion is not, nor will it ever be, rounded to 3 billion. Bad rounding. Very bad. The author goes on to let us know that if all 73 million of us don't buy gas for one day, we are removing that amount from their pockets. Now, put aside the fact that maybe we don't all need to buy gas today, and thus wouldn't have bought the gas anyways, and thus are not removing cash from oil-covered pockets anyways. By the logic and numbers presented us, we could calculate that $2.292 billion a day would mean an annual income of $837.15 billion (in the logic of the author, that's almost 1 trillion!). $837 billion. Roughly the nominal GDP of Mexico. Very impressive. Especially when you consider the nominal GDP of Saudi Arabia is only $348.6 billion, the UAE is $168.3 billion, Kuwait is $96.1 billion, and Qatar is $52.7 billion (all numbers courtesy of the International Monetary Fund). Even if the entire economy of these four massive oil producing nations were oil based, it still wouldn't add up to that number. And since the boycott is aimed specifically at Middle Eastern oil industry, we should still feel free to buy from any American oil company, right?

But putting aside all the flawed reasoning, bad data, and high hopes discussed thus far, the most obvious defect in this entire scheme is that the vast majority of participants in this "gas out" are playing a zero-sum game; that is, while they may avoid buying gas today, they will inevitably buy gas tomorrow or bought it yesterday. There isn't a loss in the pockets of the gas companies. You're simply giving it to them earlier or later. And the gas companies, fully aware of what is going on, have accounted for this. You know how I can tell? Yesterday, in the 8 hours I was at the office, the price of gas shot up 40 cents a gallon. Today, the prices dropped. Money says prices go up tomorrow. Gas companies, those bastions of free-market economics, know that they can induce people to buy by dropping the price today. Buy it today, and you might actually get a good price (good being a relative term, of course).

How could you hurt the oil companies, oh optimistic youth of America? Don't buy gas for a month. Convince all your friends to carpool in a hybrid. Take over the NYMEX and use basic economics to drop the market-set price of oil to a range you deem reasonable (ah yes, traders set oil prices... always so overlooked). Convince every investor that oil is a bad investment, thus killing the demand, and the price.

Alternatively, you can do what one of my friends did: get a job at an oil company. He doesn't pay for gas, and gets more money when gas prices go up. All you have to do is relocate to Texas and sell your soul! At prices like these, it's a bargain!

Until then, it sucks, but I will keep buying gas, and, like it or not, so will you. In fact, the gas station across the street just dropped their price 15 cents. Excuse me while I get in line behind the elderly gentleman and his wife who clearly didn't get the e-mail. Fill 'er up.

*Pop* goes the bubble.