The task of combing through mountains of emails, spreadsheets, memos and other records in the discovery process currently falls on a legion of “contract attorneys” who jump from one project to another, employed by companies like Epiq Systems. Many are recent grads who are unable to find full-time employment, or lawyers laid off during the recent recession.

Scan. Point. Click. Repeat. That’s the job. Contract attorneys are paid by the hour to sit in front of a computer and review a mind-numbing sequence of uploaded documents. There are cramped, sunless rooms in law firms throughout the city, with rows of computers piled one on top of the other, and constant uncertainty as to how long each particular stretch of employment will last.

Predictive coding promises to make this job much more efficient over time – and drastically reduce the amount of work and number of contract attorneys employed.

Using the technology, a senior attorney familiar with the intricacies of a specific case reviews and codes a “seed set” of documents. An algorithm then identifies properties among the manually reviewed documents to code and sort everything else. Each document is assigned a score to indicate the likelihood it’s correctly coded.
Proponents say predictive coding is not only more accurate than using human reviewers, but also more efficient …. There’s no escaping the fact that as predictive coding is used more widely, the technology will reduce the overall number of documents to be reviewed and the attorneys needed to review them. Judge Peck noted the technology will require human review of less than 2 percent of all documents in an average case. His stamp of approval means that the document reviewer ranks may be culled sooner rather than later.

Mead adds a comment about what this means for the future of lawyering as a profession and as a safety ticket to the upper middle class. I would add the additional comment that survival lies in getting on the right side of algorithm production. That doesn’t necessarily mean that one has to write algorithms. We live in a highly complex economy with many niches. But whatever one’s niche, it helps a lot to be aligned on the side of the angels of creative destruction, rather than sitting in their path.

Software is getting smarter, and computers continue to grow more powerful. What we see now is only the beginning of a process by which the routine elements of legal work — and frankly speaking, that is where the bulk of the jobs have always been — can and will be automated. Not all young lawyers will be doomed. There will be some smart, entrepeneurial kids who figure out how all this computing power can allow a small, lightly capitalized firm to deliver high quality services at a breathtakingly low cost to selected clients. Those kids will do well.

Others will benefit from greater demand. Legal services are likely to get cheaper: there is a lawyer glut that is likely to grow, and the increasing capabilities of computers in the legal field mean that the amount of available legal brainpower will explode. Cheaper legal services mean that more people and firms will use the legal system and legal expertise in various ways: the lawyers and firms who figure out how to ride this wave will also do well.
Brilliant and creative lawyers will continue to do well. So will the marketers, the deal makers and the connectors. But law isn’t going to be the kind of safety play ticket to the upper middle class that it used to be.

As dispatches from my Times colleague Peter Lattman have made abundantly clear, Dewey collapsed under the weight of a toxic combination of high leverage, lavish financial guarantees to many partners and faltering revenue. This makes it, in many ways, the Lehman Brothers of the legal profession, although perhaps that’s unfair to Lehman Brothers. Though highly leveraged, Lehman Brothers had enormous assets on its balance sheet — while Dewey, like law firms generally, had scant tangible assets. Nonetheless, that didn’t stop the firm from heavy borrowing of about $225 million, both by issuing bonds and by drawing on a large line of credit.

“This absolutely falls into the category: What were they thinking?” Bruce MacEwen, a lawyer and president of Adam Smith Esq. and an expert on law firm economics, told me this week, as Dewey suffered a new wave of partner defections and the firm’s accelerating collapse appeared unstoppable. “This was Mismanagement 101 across the board. They had a ringside seat for the collapse of Lehman and Bear Stearns. But they had the same mismatch of assets and liabilities. They took on a massive amount of long-term debt, but their assets are short term: they walk out of the firm every day and may not come back, which is what more and more of them did.”

It’s not yet clear how the firm used the debt proceeds. Partners say most of the debt predated the merger with LeBoeuf, and was a rational and cost-effective way to try to manage existing debt. Still, it seems likely at least some of it went to meet the extensive guarantees the firm made to individual partners, some reaching millions of dollars and apparently extending over many years.

I am curious particularly to see the bond documents in this case, from an interest in the covenants and how they are drafted with regards to things like retention of partners and so on. If anyone were able to point me in the comments to an easy online link with the bond documents, I’d be grateful. (John Coates tweets that it was a private placement – from the press reports, I was under the impression that someone had posted the PPM somewhere, or at least the main terms, but I guess not. Maybe they were just described or show to some journalists.) The Times has done excellent reporting on Dewey over the past months, likewise the Wall Street Journal, and the Economist had, as ever, a highly readable, highly quotable, really quite elegantly cribbed summary a week or so ago.

The bigger question for law firms, lawyers, law students, and law schools is less the financing model and its flaws than whether Dewey ultimately was the latest casualty in a larger shift toward the commodification of hithertofor high-end, bespoke legal services, on the one hand, and increased customer pricing power, on the other. My own unscientific sense of the market is that there will be demand for legal services, particularly in commercial law, financial services and institutions – but that much of it will be related to bread and butter transactions taking place in real time, and much less large scale transactions in which lawyers can capture up front presumed premiums from the deal that would only emerge over many years. A lot of the new demand will be at the point where commercial law meets compliance law in ordinary transactions taking place today. The value is real; but the value is also much more tightly confined, and billings will reflect that. Even so, client pricing power will also continue to reflect excess lawyer supply for the foreseeable future. Am I mistaken about this highly subjective account?

The regulation of lethal autonomous weapons can be approached from two directions. One is to look from the front-end – starting from where technology stands today, forward across the evolution of the technology, but focused on the incremental changes as and how they occur, and especially how they are occurring now. The other is to imagine the end-state – the necessarily speculative and sometimes pure sci-fi “robot soldiers” of this post’s title – and look backwards to the present. If we start from the hypothetical technological end-point – a genuinely “autonomous,” decision-making robot weapon, rather than merely a highly “automated” one – the basic regulatory issue is, what tests of law and ethics would an autonomous weapon have to pass in order to be a lawful system, beginning with fundamental law of war principles such as distinction and proportionality? What would such a weapon be and how would it have to operate to satisfy those tests?

This is an important conceptual exercise as technological innovators imagine and work toward autonomy in many different robotic applications, in which weapons technology is only one line of inquiry. Imagining the technological end-point as law and ethics means, more or less, hypothesizing what we might call the “ethical Turing Test” for a robot soldier: What must it be able to do, and how must it be able to behave, in order to make it indistinguishable for its morally ideal human counterpart? The idealized conceptualization of the ethically defensible autonomous weapon forces us to ask questions today about fundamental issues – who or what is accountable, for example, or how does one turn proportionality judgments into an algorithm? Might a system in which lethal decisions are made entirely by machine, with no human in the firing loop, violate some fundamental moral principle?

All these and more are important questions. The problem in starting with them, however, is that the technology driving toward autonomous weapons is proceeding in little tiny steps – not gigantic ones that immediately implicate these fundamental questions of full autonomy. (And some very important critics – their enthusiasm tempered by earlier promises of artificial intelligence that failed to deliver – question whether the tiny little steps can ever get to genuine autonomy. Others question whether there will ever be any real appetite among military planners to embrace full autonomy, distinct from automated systems that nonetheless keep the human centrally in the firing loop, and not merely notionally so.)

The systems being automated first are frequently not the weapons themselves, but instead other parts of the system. But they might eventually carry the weapons in train – and that might conceivably happen whether there is any separate appetite for highly automated or autonomous weapons as an independent matter. Thus, for example, as fighter aircraft become increasingly automated in how they are flown – in order to compete with enemy aircraft also becoming more automated – eventually important parts of the flight functions operate faster than humans can. In that case, however, it looks irresistible to automate, if not make fully autonomous, the weapons systems, because they have to be integrated with the whole aircraft and all its systems. We didn’t start out intending to automate the weapons – but we wound up there because the weapons are part of a whole aircraft system.

The facts about how technology of automation is evolving are important for questions of regulating and assessing the legality of new weapons systems. In effect, they shift the focus away from imagining the fully autonomous robot soldier and the legal and ethical tests it would have to meet to be lawful – back to the front end, the margin of evolving technology today. The bit-by-bit evolution of the technology urges a gradualist approach to regulation; incremental advances in automation of systems that have implications for weapons need to be considered from a regulatory standpoint that is itself gradualist and able to adapt to incremental innovation. For that basic reason, Matt’s and my paper takes as its premise the need to think incrementally about the regulation of evolving automation.

The essay’s takeaway on regulation is ultimately a modest one – a quite traditional (at least from the US government’s long-term perspective) approach to weapons regulation. Grand treaties seem to us unlikely to be suitable to incremental technological change, particularly as they might seek to imagine a technological end-state that might come about as anticipated, but might develop in some quite unexpected way. Sweeping and categorical pronouncements can re-state fundamental principles of the laws of war, but they are unlikely to be very useful in addressing the highly specific and contingent facts of particular systems undergoing automation.

We urge, instead, a gradually evolving pattern of practices of the states developing such systems. And as part of the process of legal review of weapons systems, development through reasoned articulation of how and why highly particular, technically detailed weapons systems meet fundamental legal standards. In effect, this proposes that states develop bodies of evolving state practice – sometimes agreeing with other states and their practices, but likely other times disagreeing. This seems to us the most suitable means for developing legal standards for the long term to address evolving weapons technology. Abstract below the fold.

Abstract:

Lethal autonomous machines will inevitably enter the future battlefield — but they will do so incrementally, one small step at a time. The combination of inevitable and incremental development raises not only complex strategic and operational questions but also profound legal and ethical ones. The inevitability of these technologies comes from both supply-side and demand-side factors. Advances in sensor and computational technologies will supply “smarter” machines that can be programmed to kill or destroy, while the increasing tempo of military operations and political pressures to protect one’s own personnel and civilian persons and property will demand continuing research, development, and deployment.

The process will be incremental because non-lethal robotic systems (already proliferating on the battlefield) can be fitted in their successive generations with both self-defensive and offensive technologies. As lethal systems are initially deployed, they may include humans in the decision-making loop, at least as a fail-safe — but as both the decision-making power of machines and the tempo of operations potentially increase, that human role will likely but slowly diminish. Recognizing the inevitable but incremental evolution of these technologies is key to addressing the legal and ethical dilemmas associated with them — U.S. policy for resolving those dilemmas should be built on these assumptions.

The certain yet gradual development and deployment of these systems, as well as the humanitarian advantages created by the precision of some systems, make some proposed responses — such as prohibitory treaties — unworkable as well as ethically questionable. Those features also make it imperative, though, that the United States resist its own impulses toward secrecy and reticence with respect to military technologies, recognizing that the interests those tendencies serve are counterbalanced here by interests in shaping the normative terrain — the contours of international law as well as international expectations about appropriate conduct — on which it and others will operate militarily as technology evolves. Just as development of autonomous weapon systems will be incremental, so too will development of norms about acceptable systems and uses be incremental. The United States must act, however, before international expectations about these technologies harden around the views of those who would impose unrealistic, ineffective or dangerous prohibitions — or those who would prefer few or no constraints at all.

(Annotated version of an essay to appear in a general interest journal that does not use footnotes in its articles; sources have been added here for scholarly convenience.)

On a quick read, it looks like the judge rejected DSK’s claim that he was entitled to diplomatic or “status” immunity on the grounds that: IMF officials do not fall within the status/absolute immunity protections of the Vienna Convention on Diplomatic Immunity; the U.S. is not a party to the Specialized Agencies Convention of 1947, which lays out privileges and immunities of officials of certain international organizations; (3) the Specialized Agencies treaty does not represent customary international law of IO immunities; (4) even if it the Specialized Agencies treaty was applicable, the scope of immunities for IMF officials is limited under an annex to that agreement by the Bretton Woods Agreement and IMF Articles, which specifically limit immunity only to official acts. DSK is not entitled to this official acts/functional immunity … since he was not carrying out official duties during his visit to the Sofitel.

The full opinion is here; see the Opinio Juris discussion as well on the further customary international law claim raised by DSK but also rejected by the court. (Added: And see this further note by Julian Ku at OJ noting that the court didn’t see a need to reach the customary law questions raised by DSK in the case.)

My classes uses A. Mitchell Polinsky’s short classic, An Introduction to Law and Economics, as one of the texts – this is the class’s introduction to the Coase Theorem applied to various basic areas of law.  Being a first year elective introductory class, we limit ourselves to chapters dealing with fundamental common law topics – contract, tort, property, criminal law.  In one of the chapters on criminal law, Polinsky (quoted below) explores the application of the Coase Theorem as viewed through the work of Gary Becker (“Crime and Punishment: An Economics Approach,” 76 J. Pol. Econ. 169 (1968)):

If individuals are risk neutral, then the efficient system of law enforcement is one in which the fine punishment is as large severe as possible – equal to the wealth life of the individuals whose behavior is being controlled.  This allows the probability of detection to be very low in order to save enforcement costs.  Note that the logic of this result does not depend on the magnitude of the costs imposed on others by the harmful activity.  Thus, for example, if some activity imposed only a $1 cost on others, it still would be efficient to use as large a fine as possible – $10,000 in the example – in order to achieve optimal deterrence with the smallest possible expenditure on enforcement …. Although there is nothing logically wrong with the preceding argument, it is premised on an assumption – risk neutrality – that is not likely to be correct when the fine punishment is as high as the wealth lives of the individuals whose behavior is being controlled.

Although I won’t do it, it is tempting to give students the (photoshopped, I’m sure) photo, the quote, and then “Discuss.” (H/T to my student Brianna.)

My introduction to law and economics for first year students – a non-technical introduction to basic law and economics – has a basic discussion of Prisoner’s Dilemma, including watching one of the Golden Balls Split or Steal episodes, in which a man and a woman talk it out and she successfully steals on him. We compare the canonical payoff table for Prisoner’s Dilemma with the slightly different one in the Golden Balls game (it’s on Wikipedia). Someone sent me the link for this different episode of Golden Balls, linked above, which is indeed the most intriguing round of Golden Balls I’ve ever seen.

I am considering a final exam question in which I ask my students to explain the above video (specifically this video, and not only Golden Balls in general), and explain how the general Golden Balls payoff table works, and then to discuss whether they think that the player who leads off the negotiation has altered the other player’s rational strategies or not. Or instead whether this is just a version of trying to build trust in a single round game, without finally changing what makes sense for the players to do, assuming a single round game. The exam is open book, open note, open discussion beforehand – I’m interested in seeing how they explain the answer, to see whether they can demonstrate in their explanation that they understand the logic of the situation. I’m inviting them to prepare this answer in advance.

If I decide to use this as a final exam question, I will invite them to look at this post, as well as at the comments to the video and anything else they might like. So I would like to invite you to explain as clearly as you can, in a non-technical way, accessible to students who do not have a background in game theory and strategic behavior, how they should see this particular episode of Golden Balls. I am particularly interested in whether everyone agrees with how to answer the question: does player 1 in this episode manage to come up with a move in the game that alters the rational strategy of the other player (or both players), or is this instead just another attempt to come up with a way to create extra-rational trust? Thanks!

To judge from previous comments on robotics discussions here at VC, commenters tend toward a sort of snobbish techno-reductivism, dismissing questions of society and robots, regulation and robots, etc., as the task of lesser minds, separate from the smart people who deal with “real” innovation.  (Our readers, I’d guess, are much less snobbish that way.)  Let me say up front that this is silly.  If robots are going to leave such places as the factory floor and enter ordinary society, then social robotics and the questions of design that address the human-robot interfaces will be utterly crucial – and not easy, even if they involve questions of psychology, sociology, and law. Be Not A Techo-Snob, Ye Who Enter Here.

• The first is a question of process, including both the mechanism and the way in which information on legal policy is conveyed in these matters. To start with, are “speeches” enough? After all, as Charlie Savage said, they have no footnotes or legal citations. Shouldn’t the administration release the legal opinions prepared by OLC or other legal advisers? Perhaps any records of any of the internal officials involved in decisions to put someone on a target list? The point at bottom is to say that mere speeches filled with assertions and declarations are not by themselves sufficient.
• The second is also a question of process – but it goes not to what is released by way of explanation, how it is stated, by whom and in what detail – but instead goes to the question of who should be able to review the substantive decisions. Which is to say, is the oversight process sufficient and, not to put to fine a point on it, shouldn’t there be judicial review of this in some fashion?
• The third is a question of the substance of the law, both domestic and international, on the actual issues of targeted killing, drone warfare, covert actions, etc. – is it right, or at least a plausible claim?

Thus, the rapidly heating up war between Sudan and South Sudan.  It is about oil, which is to say, for the two regimes it is about the money – with oil production being the only thing keeping each regime afloat.  In that sense, there’s a strong common interest that should allow party bargaining.  But the Coase Theorem requires as a condition to bargain that the parties have clear legal entitlements and liabilities in order to provide a reference framework for bargaining.  One might have thought that the international settlement that brought about the then-peaceful separation of South Sudan from Sudan would therefore have insisted on clear legal entitlements to the oil fields, production facilities, transport of oil, in the interests of both parties.  Unfortunately it left all this open, along with the final question of the borders.

With no clear legal entitlement – let alone a way to enforce it short of using force – there is no clear basis for bargaining, even when there is a common value of money via oil.  Clear titles would then have provided a basis for prior bargaining over who would get what in the division of payoffs.  Moreover, each party would presumably have seen that the transaction costs involved in war – to deny the other any entitlement to which it might lay claim by destroying the ability to exploit the resource at all – would far exceed the benefits even of winning.  Unfortunately, it is not so far turning out that way; the legal entitlements themselves are the object of the war:

[R]ather than sparking an all-out military confrontation, each side’s aim may now be to target one another’s oil facilities and wait for their opponent to crumble under armed insurgencies, popular unrest and fuel shortages. The two countries have already driven their economies to the brink of implosion since the South split away, cleaving the vital oil industry in two. Squabbling over oil payments and border fighting has withered combined crude output – previously the main source of foreign currency and state revenues for both countries – from around 500,000 barrels a day before partition to just over a tenth of that. Food prices are soaring on both sides of the border and currencies reeling as officials scramble to make up for the sudden loss of revenues in countries already reeling from years of war, mismanagement and U.S. trade sanctions.

But despite their weaknesses, both sides have consistently reckoned they have the upper hand on their foe, partly explaining why fighting has escalated despite the obvious fact that neither side can actually afford to fight a war … ”Khartoum is fighting for its survival,” said Peter Bashir Gbandi, a deputy for the ruling Sudan People’s Liberation Movement (SPLM) in the South’s national assembly, during an emotional Juba panel debate packed with bellicose comments and broadcast live on radio …. many in the South have predicted Sudan’s President Omar Hassan al-Bashir, in power since a 1989 coup, will soon meet the same fate as leaders in neighbouring Egypt and Libya.

If the South can hold out a few months longer, the reasoning goes, Sudan’s people will surely overthrow their government and replace it with a regime more receptive to Juba’s demands. Khartoum, on the other hand, sees a good chance the South – already hit by domestic rebellions, horribly violent cattle raiding and widespread poverty – will soon run out of money and descend into ungovernable chaos.  The result is what Harry Verhoeven, a University of Oxford researcher who has studied Sudan extensively, calls a “war of attrition” in which both sides wait for the other to crumble internally or run out of the funds and fuel needed to wage war.

As background to Sudan and South Sudan, I recommend The Sudan Handbook, put out by scholars of the Rift Valley Institute (of which I am a senior fellow) – reviewed here by Tom Porteous of Human Rights Watch.

If one starts, after all, from a view that regulators can do anything effectively and well, provided they are given the unfettered discretion to do so, and the ability to ignore mere politics, then life is pretty sweet – or, anyway, intellectually easy.  If, on the other hand, one starts from a radical skepticism about the ability of regulators to do anything effectively, and moreover an unfettered faith that there are no market failures and that “private ordering” will always work, then life is also pretty sweet – or at least intellectually easy.  But that doesn’t describe how most of us understand the regulatory situation, which involves both market-fail and regulatory-fail, and tradeoffs between different forms of regulation, public ordering and private ordering.

Professor Schwarcz has been writing a series of papers since before the 2008 financial crisis that account analytically for the leading issues of the financial crisis in the US and, more recently, has been turning to the Eurozone crisis as well.  (I also have to say with considerable embarrassment that I am long over-due on a book manuscript with Steve on financial regulation – slow in coming but gradually getting written, in fits and starts.  ’Prudence for prudential regulators’, in the current way I’m framing it.)  Some of Professor Schwarcz’s work is highly technical, such as his writing on the deep structures of systemic risk internal to financial firms, but increasingly he has been reaching out to broader audiences, often through published addresses.  His newest is based around a keynote address delivered last year at the European Central Bank, and it aims to present in a short, succinct, and direct way the aims of financial regulation, the market and regulatory failures that are baked into those complicated aims, and the tradeoffs that regulation has to make, understanding that there is no perfect solution.  Put that way, it sounds anodyne, but it attempts – pretty successfully, I think – to address in straightforward language the task of steering between the rock of excessive optimism whether about markets or regulators, on the one hand, and the hard place of excessive skepticism about the ability to rationally design a system of regulation or markets at all.  This piece will be appearing in the Wisconsin Law Review in 2012; introduction is below the fold.

How can the law help to control financial chaos? By financial chaos, I mean the failure of a chain of financial markets or financial firms, or a chain of significant losses to financial firms, that results in increases in the cost of capital or decreases in its availability. The risk that financial chaos will occur is often referred to as systemic risk.

Many regulatory responses to systemic risk, like the Dodd-Frank Act in the United States, consist largely of politically motivated reactions to the 2008 financial crisis, looking for villains (whether or not they exist). To be most effective, however, the regulation must be situated within a more analytical framework.

To create such a framework, we first need to consider what the scope of systemic risk regulation should be. There has been a great deal of regulatory focus on banks and other financial firms. Some of this is path dependent: historically, a chain of bank failures remains an important symbol of systemic risk. The media and politicians also have focused on financial firms because they are so visible and their problems have been so dramatic.

But we also need to recognize that the ongoing trend towards disintermediation—enabling companies to directly access the ultimate source of funds, the capital markets, without going through financial intermediaries—is making financial markets themselves increasingly central to any examination of systemic risk.

For example, although the bankruptcy of Lehman Brothers in 2008 filled the headlines, its trigger was the collapse of the market for mortgage-backed securities. Many of these securities were collateralized in part by risky subprime home mortgages, which were expected to be refinanced through home appreciation. When home prices stopped appreciating, the borrowers could not refinance. In many cases, they defaulted. These defaults caused substantial amounts of investment-grade rated mortgage-backed securities to be downgraded and, in some cases, to default. Investors began losing confidence in these and other rated securities, and their market prices started falling.

Lehman Brothers, which held large amounts of mortgage-backed securities, was particularly exposed. Lehman’s counterparties began demanding additional safeguards, which Lehman could not provide. Absent a government bailout, Lehman filed for bankruptcy. That, in turn, caused securities markets to panic; even the short-term commercial paper market virtually shut down, and the market prices of mortgage-backed securities collapsed substantially below the intrinsic value of the mortgage loans backing those securities. That accelerated the death spiral, causing financial firms holding mortgage-backed securities to appear, if not be, more financially risky; requiring highly leveraged firms to engage in fire-sales of assets (thereby exacerbating the fall in prices); and shutting off credit markets, which impacted the real economy.

This demonstrates that both financial firms and financial markets can, if they fail, be triggers and transmitters of systemic risk. The scope of any regulatory framework for managing systemic risk should therefore include both financial firms and markets.

Before attempting to design such a regulatory framework, we need to examine what the framework’s goals should be. The primary goal for regulating financial risk is micro-prudential: maximizing economic efficiency within the financial system. Systemic risk is a form of financial risk, so efficiency should certainly be a goal in its regulation. But systemic risk also represents risk to the financial system itself. Any framework for regulating systemic risk therefore should also include that macro-prudential goal: protecting the financial system itself.

Industry officials say the shift in government support is taking place just as the robotics market is maturing. Eight years ago, the U.S. Army had 162 robots and robotic devices. Since then, it has bought 7,000. With some devices lost in combat and others retired, it now has more than 4,000 robots on hand.

In the early days of the Iraq war, the U.S. military bought a variety of robots off the shelf, rather than going through the lengthy process of selecting and developing a one-size-fits-all model. They can range in price from just over $10,000 to a quarter of a million dollars. Robots took on missions beyond their early deployment as bomb detectors—to scouting inside bunkers or caves. They come in many forms, from handheld devices tossed through a window to check out a room, to large, tracked robots that can lift heavy objects ….

As government funding changes, manufacturers are also looking for new applications for robotic technology. QinetiQ is developing ways to make military vehicles—such as trucks or Humvees—”optionally manned,” equipped with aftermarket kits that would allow them to be driven by remote control, or even operate autonomously. Federal officials are encouraging inventiveness. The Defense Advanced Research Projects Agency this week announced a contest to develop robots that could aid in disaster response.

For all of the attention that goes to remotely piloted vehicles, many of the new emerging technologies likely to have deep impact in the civilian sector are not aerial vehicles.  Driverless cars is a technology that is emerging faster than, I think, practically anyone thought possible, in part because there were serious questions about whether individual cars could become driverless and operate on their own, or whether they had to be part of a gigantic networked system of driverless vehicles.  I have often noted here at Volokh that the nursing industry is ripe for greater reliance on robotic technologies of many kinds.  Aviation is important, but it is far from the whole story.  And the background role of law and regulation will have an impact on the directions that technology moves, as Stanford’s Ryan Calo has often noted.  (In that regard, check out the upcoming University of Miami conference on law and robotics, We Robot – if I had been more diligent, I would have submitted a paper, but the conference looks terrific and I look forward to reading the work that comes out of it.)

Former Apple Inc. Chief Executive Steve Jobs was a key player in a conspiracy with five major book publishers to drive up the price of digital books, federal and state officials said in antitrust lawsuits filed against the companies.  Jobs helped orchestrate a complex price-fixing plan that cost consumers tens of millions of dollars over the last two years by boosting the price of many new releases and bestsellers by $3 to $5 each, federal investigators said. Apple even proudly described the maneuver — which gave the iPad maker a guaranteed 30% commission on each e-book sold through its online marketplace — as an “aikido move,” referring to the Japanese martial art, according to the lawsuit.

“The customer pays a little more, but that’s what you want anyway,” Jobs told the publishers at one point, said Sharis Pozen, the acting head of the Justice Department’s antitrust division.

I’m not a competition law expert, so I would be interested in what folks knowledgeable in antitrust law think of the suit on its legal merits.  But I have been following the book selling business closely for several years, as I’ve used the travails of Borders and Barnes and Noble in competition with Amazon, Wal-Mart, etc., in class studies for quite a while.  As the New York Times  notes in its story, the effect of DOJ succeeding is to put pricing power back into the hands of Amazon – we all remember the famous, simple pricing on the original Kindle at 9.95 (or was it 9.99?).  Overall, I think that a successful antitrust action will put great pressure on the book publishers, and it will favor not only Amazon as a retailer, but increasingly as a publisher, in a world defined by a flattening of the publishing landscape toward self-publishing or “minimally intermediated” publishing.

Is a world of increasing self-publishing a good thing?  The question in part depends on whether the methods by which people can efficiently sort the stuff they want from the stuff they don’t – if we don’t have front end curation through publishing houses, then the ability to sort through to what you want will depend on back-end curation. These mechanisms are likely to be very different for different reading communities – the popular fiction markets, the scholarly and academic markets, etc., with different sorting mechanisms.

Apart from the sorting processes, there’s also a quality of production issue – how improved by the publishing process are books, quite apart from the selection process for publication in the first place?  On the one hand, those of us who have followed the decline and fall of the editor who has the time to work seriously with an author know that there has been a steep decline in rewriting and re-working at the publishing level – and the result, I’d say, is mostly that books are much longer, not to their improvement, because there is not a strong hand to cut out stuff.  But that is editing at a serious, high level.  The rise of essentially self-publishing raises a quite different problem – simply grammar, spelling, functional readability – a lot of editing that one takes for granted, and which many writers (experienced academics who write a lot, like me, for example) just assume isn’t a big deal.  It is a big deal, once you see what an experienced and serious copy editor(s) find going through a book-length manuscript that you thought you’d combed over thoroughly.

At that level of micro-level quality control, I’d envision seeing the rise of new editing services to do that at a relatively cheap price for your self-published e-book, leading to what I called the “minimally intermediated” model.  And of course, there is the rise of Amazon as an actual publisher, commissioning works for Kindle, and putting a certain brand name behind them as having both copy editing and production quality control, but also a brand name behind the book as worthwhile reading.

My new book, Living with the UN, is not yet out in Kindle – give it another week or two.  I don’t know what the price will be, but the economics for a think-tank press looking to subsidize getting the ideas out there to the public are very different from commercial or even academic publishers.  Jack Goldsmith’s new book, Power and Constraint, is published by WW Norton, listed for 26.95, immediately discounted by a third to 17.79, and the Kindle edition is 14.82.  Almost certainly a successful antitrust action would bring that price down.  Living with the UN is listed at 19.95 and immediately discounted a third to 13.43; Nook edition is already out and priced at 9.95, and I’d imagine Kindle will do the same thing.

Over the long term, the effect of pushing prices of e-books down in the short term might be to favor fewer high production price books and more minimally edited self-published books.  But this is speculation – though I follow book publishing business models closely.  What do readers think?  Where is book publishing going in a world of e-books, and a potential lifting of publisher-set e-book prices – looking to the long run?

There are reasons for these gradations – e.g., consent for US operations in a country might well be secret and subject to some level of deniability.  But they make it difficult for CIA officials and lawyers even to acknowledge the topics in the abstract.  There will be lots of disagreement, no doubt, about what can or should be made public by executive branch lawyers, whether through DOJ, CIA, DOD, DOS, or other agencies – but I would like to commend Mr. Preston for seeking to find ways to address these issues, to the extent that he and others in the executive believe they can or should do so publicly.

Remarks of the Honorable Stephen W. Preston
General Counsel
Central Intelligence Agency

Harvard Law School
Cambridge, Massachusetts
Tuesday, April 10, 2012

“CIA and the Rule of Law”

AS PREPARED FOR DELIVERY

For those working at the confluence of law and national security, the President has made clear that ours is a nation of laws and that an abiding respect for the rule of law is one of our country’s greatest strengths, even against an enemy with only contempt for the law. This is so for the Central Intelligence Agency no less than any other instrument of national power engaged in the fight against al-Qa’ida and its militant allies or otherwise seeking to protect the United States from foreign adversaries. And that is the central point of my remarks this afternoon: Just as ours is a nation of laws, the CIA is an institution of laws and the rule of law is integral to Agency operations.

Before we get to the rule of law, I want to spend a moment on the business of the CIA.

I will start off with two observations that I think are telling:

First, the number of significant national security issues facing our country may be as great today as it has ever been. Just think of what the President and his national security team confront every day: the ongoing threat of terrorist attack against the homeland and U.S. interests abroad; war in Afghanistan and, until recently, Iraq; complex relations with countries like Pakistan and India; the challenges presented by Iran and North Korea; the emergence of China and its growing economic and military power; the growing number of computer network attacks originating outside the United States; profound change in the most volatile area of the world, the greater Middle East, with new regimes in Tunisia, Egypt, and Libya, and continuing violence in Syria; the financial challenges faced by countries in the Euro zone; and the violence associated with drug trafficking in this hemisphere. And the list could go on.

Second, the national security issues facing our country today tend to be intelligence-intensive. Intelligence is fundamental to the efforts of policy-makers to come to grips with nearly all of the issues I have just listed – whether international terrorism, the proliferation of Weapons of Mass Destruction, the conduct of non-state actors and rogue states outside the community of nations, cyber security, or the rise of new powers. The nation’s leaders cannot fully understand these issues or make informed policy on these issues without first-rate intelligence.

Putting these two dynamics together – the multitude of different national security issues and the fact that intelligence is critical to almost all of them – it may be that intelligence has never been more important than it is today. At the very least, the intel business is booming.

So what does the CIA do? Our work boils down to three jobs. To quote from the National Security Act of 1947:

• Agency operators, quote, “collect intelligence through human sources and by other appropriate means.” This is also referred to as foreign intelligence collection or, at times, espionage.
• Agency analysts, quote, “correlate and evaluate intelligence related to the national security and provide appropriate dissemination of such intelligence.” This is also referred to as all-source analysis and national intelligence reporting, and it requires that the products of all intelligence disciplines be integrated.
• And the Agency performs such other functions and duties as the President may direct, which may include activities to influence conditions abroad,quote, “where it is intended that the role of the U.S. Government will not be apparent or acknowledged publicly.” In other words, covert action.

We need ways of explaining the United Nations so as to explain and predict how it will evolve and whether and when that evolution will support U.S. ideals and interests or conflict with them.  So let us shift to another, quite different means of explaining the United Nations. The master issue, in this explanation, is the institution’s source of legitimacy. The key to relations between the United States and the United Nations is to address their contrasting—sometimes supporting and sometimes competing—legitimacies. The peculiar limits of U.N. legitimacy contribute to the institution’s most persistent large-scale feature: paralysis, a very particular kind of paralysis because it consists of marching, constant marching, but marching in place.

The United Nations consists of deep contradictions. More exactly, it consists of antinomies—profound, connected opposites that are “baked into” the institution’s structure, history, incentives, and motivations. So:

•  The United Nations is an independent institution with independent global claims to govern; the United Nations is a mere instrumentality of the member states.
• The United Nations is an institution based around the sovereign equality of states participating in a universal institution; the United Nations is committed to certain values and yet, at least in principle, there are standards to be met by states as a condition of joining and participating.
• The United Nations is the talking shop of the nations; the United Nations is a genuinely shared society of the world and not just the meeting ground of states’ politics.
• The United Nations is merely the humble servant of its states; the United Nations is an independent governmental actor directly representing the “peoples” of the world.
• The secretary-general is merely the ministerial servant of the member states of the United Nations; the secretary-general is something approaching, albeit weakly, the “president” of the world.
• The United Nations is about global governance; yet it is said to be governance without a global government.

But the most powerful of the United Nations’ many and varied antinomies is the one that ironically turns the institution’s very failures into its most potent source of legitimacy. The distinctive salience of the United Nations is that it is a failure today—and a hope for tomorrow. And this is so even though it is always a failure today, each and every day—and yet always a hope for tomorrow. Return to the image of the United Nations as a sickly sapling. Feeble as it is today, it still holds out the promise of growing to become a glorious overarching tree—the glorious sheltering tree of global governance—but tomorrow, and always tomorrow.  Everything the organization does today, no matter how ineffective, ineffectual, corrupt, rent seeking, or just plain wrong, has to be excused on the basis of what the organization will someday be ….

The deepest of the United Nations’ failures is the way in which future promises lock in failure today. The rhetoric that surrounds the United Nations, the rhetoric that gives us the persistent ideal of “the Parliament of Man,” has this constant and peculiar trope. It is always looking beyond the dismal present-day of the United Nations to the glorious transcendental future of global governance, always on offer, but always on offer tomorrow. Call it U.N. platonism—an infatuation with “global governance” as an ideal platonic form. Or maybe call it the nonfalsifiable idea of the United Nations.

There are apparently no circumstances in the real world in which the ideal of the platonic United Nations could be found definitively wanting. The persistence of global hunger? Inevitably it means we must commit ever more deeply to the United Nations and give more to its development program. An outbreak of epidemic disease sweeps the planet? Clearly, we need to invest more in U.N. agencies and should have done so earlier. Nuclear war breaks out between regional powers? The problem must surely have been the insufficient emphasis placed on engagement through the United Nations’ multilateral disarmament and nuclear nonproliferation negotiations.

The United Nations always remains the default answer, no matter what the question and no matter how badly its own failures contribute to the problem. And even if it is not the answer right now, we apparently are supposed to act as though it were in order that it may become the answer for tomorrow. But that hope is worse than useless.

Over the next couple of months, I’ll be talking more about what this book says, claims and counter-claims, and talking about specific points in the book, particularly in relation to what’s going on in the current flurry of activity of the US in the Security Council – the one place in the UN constellation, unsurprisingly, where US engagement is always the right policy, something that cannot be said of lots of other UN activities.  (Added a couple of paragraphs to the quote to make the thesis a little more plain.)

• Each can be used to gather intelligence – to engage in surveillance.
• Each can also be used to intervene, that is to take action with “physical world” results that can be characterized as using force.
• Each allows intervention to be taken at a distance, so that one’s own personnel are not risked.
• Each favors the attack – although defensive and counter technologies will not doubt emerge, at this point both cyber and drones favor offense over defense.
• Each tends to make “attribution” of the intervention or attack difficult, and make more difficult deterrence or the threat of retaliation – the reciprocal threat that has traditionally undergirded international law on the resort to force.  The difficulty of attribution also makes more difficult response by any international mechanisms for enforcing the laws on resort to force, such as action by the Security Council.
•  The combination of favoring offense over defense, and the difficulty of attribution, mean that they tend to be de-stabilizing strategies, undermining rather than reinforcing the status quo.

These are all features that these two technologies tend to share in common.  However, there are differences, and one stands out in the question of regulation of covert action:

• Cyberwarfare tends, at least as a tendency and at least how we imagine it now, toward lack of discrimination in its attacks and consequences.  Stuxnet appears to have been created to be extraordinarily precise in its targeting, but the general tendency of cyberwarfare is either to target widely or even, in legal terms, indiscriminately without much attention to collateral consequences of attacks on infrastructure such as electrical grids.  Or else to deliberately target infrastructure for the purpose of attacking civilians.  This is not necessarily so, but it does appear to be a likely tendency of cyberwar.
• Targeted killing using drones, by contrast, is by its strategic design aimed at greater precision and greater discrimination, while at greater and more personally remote distance.  That is its point.  However, the greater discretion in targeting is the same that makes attribution more difficult; the benefit of precision and discrimination in the conduct of operations carries the problem of attribution.

Which is to say that in the case of cyberwar, a tendency toward indiscrimination goes hand in hand with making attribution difficult.  In the case of targeted killing using drones, there is a tradeoff between the increased difficulty of attribution and the greater discrimination offered by precision technology.  The tradeoff situation is the morally more difficult one, because it raises the question of genuine tradeoffs.

I have argued strenuously that in the case of such tradeoffs, the moral answer cannot be to pass up the possibility of more discriminating targeting technology because we fear that increased lack of attribution makes it easier for states to anonymously resort to force.  If there’s a problem with states using force illegally or immorally, that has to be addressed on its own terms – it is immoral to hold the civilians or military whose lives would otherwise be protected hostage against the behavior of political leadership. But that does not make the tradeoffs go away – this argument merely says that in the case of this kind of tradeoff, this is how you must make the moral trade.

(Tufts’ Michael Glennon, who moderated my panel yesterday at which I made the above comments, explains the attribution problem as a matter of tradeoffs in a new paper to which I will link once it is up on SSRN.)

The Brookings Institution is running a panel on this topic – domestic uses of drones – this afternoon, Wednesday, 2-3:30 pm. You can register and attend in person, or you can catch the web streamed version.  It has a stellar lineup, including folks from the ACLU, Heritage Foundation, and Brookings.  I will be addressing something of particular interest to me – private party to private party uses of drones, and the questions that emerge from that for privacy.  I don’t think we have an adequate legal model for what I believe is our evolving social sense – which one would want to see reflect both in informal social norms as well as in some ways embedded in law – of when and where one has an expectation of privacy.  Drones, particularly drones combined with sensor technologies and the ability to stream, identify people, and post to the web, have a strong potential – no, let me be stronger – inevitably will conflict with that social expectation of privacy in important ways.

There can be a limited but still appropriate criminal law role for regulating that expectation of privacy – essentially Peeping Tom laws or in extreme cases, criminal anti-stalking orders.  But in private party to private party interactions, involving drones, surveillance, and privacy, I believe the appropriate responses largely come from existing bodies of law tweaked and updated – nuisance and the quiet enjoyment of property doctrines, for example.  But I suppose I am particular interested in the changing perception of privacy, intimacy, broadcast, and dissemination, in which drones are an important new link in a chain of the exposure of a person, and perhaps the constant exposure of a person.

I often read that essentially the younger generation – and the older one – does not care at bottom about privacy, at least not enough to do anything about it, or to make tradeoffs in terms of new technologies and applications, such as FB or GPS tracking, etc.  I’m not sure I think it’s really that way – on the contrary, my sense of high school students and undergraduates – leave aside law students – is that they have a remarkably sophisticated “bundle of sticks” approach to privacy issues, and believe that it is deeply socially constructed.  Meaning, that they should be able to have social and legal rules that say that something that is apparently in the “public” domain is there for one purpose legitimately but not another.  The FB picture from the college trip to the beach is there for one kind of purpose, but not for purposes of employer surveillance.

This can be regarded as sophisticated or naive, depending on how one sees the realism of constructing and enforcing legal rules that purport to distinguish single sticks in the bundle of sticks, so to speak.  It can also be seen as wanting to have your cake and eat it too, in terms of being able to parse what was otherwise just public and private.  But my sense of young people, particularly, is not that they think everything is or should be public for all to see, but instead that they have a highly differentiated sense of kinds of public and kinds of private, and that the law should catch up to that.  I think in principle that they are right – being older and wiser, however, I have considerable doubts it will turn out that way.

The echo chamber Jonathan describes is certainly true of my experience.  It defines the boundaries of the acceptable world within the academy.  In my experience, it is also true that conservatives and libertarians do have an ability to frame things the other direction, as a function of being a counter-culture.  But isn’t a fundamental issue here strategic gaming behavior by legal academic elites who do detect, beyond the echo chamber, political rumblings in broader society that might eventually have effects on legal results in these kinds of society-shaping decisions?  And who therefore attempt to manage outcomes – in the way that elites so often do – by managing the frame of acceptable and unacceptable argument?  (This is, by way, a pretty good way of defining “reactionary” – and one that Stendhal, if one reads the hilarious chapter on the drawing room of the Hotel de la Mole in The Red and the Black, would have understood perfectly. It has been a while since I have mentioned Stendhal here at VC, and you know you miss it – ed.)

Seen from a strategic gaming frame, then, the interest of elite legal academics is not to “predict” the Court, but instead to influence the framing of acceptable and unacceptable opinion and thereby set the boundaries of outcomes.  The function of dismissing this or that is to seek to establish the boundaries, so to speak, of Justice Kennedy’s moral world.  And in that case, what purpose is there even to admit the possibility of Co-Conspirator Randy Barnett’s opinions?  Admitting that possibility might make prediction more accurate – but it also risks making the prediction more likely to come true.  Far better to treat it as right-wing libertarian craziness, in order to lessen the chance that it might turn out … not to be craziness.

Added:  To be clear, I’m not suggesting a conspiracy theory or bad faith.  I’m just pointing out that if your interest as an elite legal academic is to influence the Court, rather than predict it, then you have an interest in not giving credence to particular kinds of arguments.  That’s so irrespective of whether your world-view as an academic can find room for them or not; if your world-view doesn’t admit of these kinds of claims then it is not inconsistent with this form of strategic gaming, but rather reinforces it; and if it does, then you do have an inconsistency and have to choose what matters to you more – prediction or influence.  It isn’t a claim of conspiracy or bad faith – just an observation about incentives based an a hypothesis about a certain kind of interest.

I’m fairly sure someone said exactly this in the comments to Jonathan’s post, but I didn’t wade through the 400+ (the VC commentariat is back?!) comments to find out.

Statement Regarding Syria
Harold Hongju Koh
Legal Adviser, U.S. Department of State
American Society of International Law Annual Meeting
March 30, 2012

It is my honor to speak here again at the annual meeting of the American Society of International Law. A year ago, I spoke before this audience about the international legal basis for the United States’ military operations in Libya. In that same spirit of openness and dialogue, I am grateful for the opportunity to engage so many distinguished international lawyers in this room about the very serious challenges we face in Syria today.

Let me divide my comments this morning into three: First, what, precisely, is happening in Syria? Second, what are the U.S. government and the international lawyers within it doing to address the crisis? And third, by what legal principles should this crisis be assessed and lawfully and effectively addressed?

Roger, which is the first name of his cover identity, may be the most consequential but least visible national security official in Washington — the principal architect of the CIA’s drone campaign and the leader of the hunt for Osama bin Laden. In many ways, he has also been the driving force of the Obama administration’s embrace of targeted killing as a centerpiece of its counterterrorism efforts.

Colleagues describe Roger as a collection of contradictions. A chain-smoker who spends countless hours on a treadmill. Notoriously surly yet able to win over enough support from subordinates and bosses to hold on to his job. He presides over a campaign that has killed thousands of Islamist militants and angered millions of Muslims, but he is himself a convert to Islam.

His defenders don’t even try to make him sound likable. Instead, they emphasize his operational talents, encyclopedic understanding of the enemy and tireless work ethic.

“Irascible is the nicest way I would describe him,” said a former high-ranking CIA official who supervised the counterterrorism chief. “But his range of experience and relationships have made him about as close to indispensable as you could think.”

Miller’s profile of ‘Roger’ is utterly compelling reading – I think once you start, you’ll want to read the whole thing.

One topical example of national security federalism is raised by the controversy over NYPD surveillance of various Muslim groups.  It is easy to view this issue in familiar terms of substantive balances or tradeoffs of security versus privacy – and seen in those terms, the natural solutions seem to lie in tightening and enforcing substantive restrictions and guidelines that govern police intelligence activities and investigations. Waxman’s new article is important for focusing instead on the broader structural and institutional issues – the federalism issues – at stake here, too:  What role should local police agencies play in terrorism prevention, and how should their cooperation be organized horizontally (among local police agencies) and vertically (between the federal and local governments)? How much discretion should state and local governments have in performing counterterrorism intelligence functions, and what are the dangers and opportunities in localized variation and tailoring?  (Below the fold, the abstract from SSRN.)

National security law scholarship tends to focus on the balancing of security and liberty, and the overwhelming bulk of that scholarship is about such balancing on the horizontal axis among branches at the federal level. This Article challenges that standard focus by supplementing it with an account of the vertical axis and the emergent, post-9/11 role of state and local government in American national security law and policy. It argues for a federalism frame that emphasizes vertical intergovernmental arrangements for promoting and mediating a dense array of policy values over the long term. This federalism frame helps in understanding the cooperation and tension between the federal and local governments with respect to counterterrorism and national security intelligence, and also yields insights to guide reform of those relationships. The Article emphasizes two important values that have been neglected in the sparse scholarship on local government and national security functions: (1) accountability and the ways vertical intergovernmental arrangements enhance or degrade it, and (2) efficiency and the ways those arrangements promote public policy effectiveness. This Article reveals the important policy benefits of our shared federal-local national security system, and it suggests ways to better capture these benefits, especially if terrorism threats evolve to include a greater domestic component.

My book, Living With the UN: American Responsibilities and International Order, is now in stock and on-sale at the Hoover Institution Press website.  I have a copy in hand and I’m delighted to be holding it.  It’s not quite like holding your new baby – but for an inanimate object, it’s closer than you might have thought.

It will be a couple of weeks – April 17, I understand – before it is available through Amazon, Barnes & Noble, and other online sellers.  A Kindle edition will be released on April 17 as well.  My thanks to the Hoover folks, my editors, and others for their patience in this long running project.  Over the next couple of months, I will be talking about various themes in the book – UN-US relations, the nature of the UN, the different ways in which the US should engage (or not) with different parts and functions of the UN.  To start with, however, I wanted to go to a very different topic – this one about publishing, choosing a publisher, and why I chose the Hoover Institution Press.

This is a policy essay, not a “scholarly” book – it has about twenty footnotes for the whole thing, and a bibliography of secondary sources aimed to be accessible to those without a university research library or knowledge of how the UN online archives work.  My interest in this case is dissemination of the ideas in the book, not staking out academic turf.  So my general choices were three: One, find a commercial trade publisher, which seemed improbable given the subject matter, the way it is written, and my lack of trade press publishing in the past.  Two, find a university or academic press; this seemed like the obvious thing, and in fact there were several options that direction, notwithstanding that this is something like the opposite of the dense academic monograph.  Third, go with a think tank policy press in which case, given the history of the project and my affiliations, it would be Hoover.

The Hoover publishing folks have been marvelous – let me strongly recommend them if your publishing suits their programs.  They have been fabulous on production values, editing and copy editing, all the professional production elements.  They have been patient to a fault in waiting for the manuscript and letting me make later changes.  And they have excellent marketing staff and have a commitment to getting the book out there in a way that is only sometimes true of academic presses whose primary audiences are academics and university libraries.  But it is true that several academic presses are great in all these ways, too, so one has to ask, why consider a think tank press?  After all, isn’t a think tank press – even one associated with a university, like Hoover – taking a hit in academic prestige and respectability?

(Added: What I mean by ‘academic prestige’ here is that a press like, say, Cambridge UP conveys a signal to other academics that the book has been vetted for scholarship, etc.; and so, if I were seeking tenure or something similar, Cambridge would send an important signal.  Think tank presses, even when associated with a university such as Hoover and Stanford, send a signal of a political program associated with policy advocacy.  Since this is precisely what my book does and proposes to do, I’m fine with this and, anyway, I’ve got tenure.  Not everyone is in that signaling position.  If one reads through numbers of the Hoover Press books, you’ll see that they have a very high level of scholarship and intellectual quality – mine is an exception for being far more an essay – on things running from the Taylor Rule to Congressional intelligence oversight – but are written much more succinctly and clearly, and never consist of a dissertation-turned-monograph destined never to be checked out of the university library.  All of which is a plus for me, but then … I’ve got tenure.)

I thought carefully about these issues before choosing to go with Hoover.  In part this is a matter of how one sees academic prestige in public international law and, particularly, international organizations – which are, after all, human institutions and not purely legal propositions.  The human experience of them matters – at least if you want to say the things about them that I say in this book.  I had a long career in the human rights and international NGO world before coming to teach in my mid-forties, dealing with international organizations frequently, and whether in private or public law, I have a relentlessly practical streak that, at least in inherently political fields such as public international law, can’t see formal legal categories as dispositive.  International law for me is always fused with pragmatism (to draw from Michael Glennon’s fine book on this topic), politics and diplomacy, realism – policy, in other words.  But formal academic “brilliance,” to put the question of academic prestige in that way, likewise requires a more formal (and closed) system that allows one to show in some surprising and (one hopes) useful way that x is true and not y.  Policy, on the other hand, is about criteria of plausibility, not truth formally as such or purely for its own sake or, frankly, sheer marvelousness in reasoning.  One can do that in many areas of domestic law, because the legal framework drives the outcomes as such, but not in my field.

So prestige is not precisely my aim because I don’t think the subject matter or the writing work to that end.  This is not to say that it has not been researched with the same care that the purely scholarly work would have – on the contrary, it is over-researched for such a short book, and it is also infused with a large number of interviews and discussions of a more journalistic nature than would drive a purely academic book.  I will say that it wears its substantive learning deliberately very lightly.  I spent a lot of time a few years ago understanding the UN budgeting, accounting, and fiscal control systems – such as they are – from the inside out, and I am pretty certain I am the only public international law academic ever to have done so, at least among the Americans.  But if prestige in the sense of building my own academic capital is not the issue here, then what do I want?

Dissemination, mostly.  I want to get this book out into the hands of a couple of audiences: the Washington and international organization policy audiences; the international NGO world; academics in international law, organizations, politics, and international relations; both the Obama administration (despite this book’s many criticisms) and the Republican campaign; and finally classrooms at the undergraduate, public policy and graduate school, and law school levels. The key issue there is price.  The book retails directly from the Hoover site for $19.95.  Hoover could sell it for more, but it is in the business of dissemination of ideas too – it and I are aligned. By contrast, the decisive factor for me in deciding what press was price – the other publishers wanted to sell at minimum $35, in several cases $40.  I’m not sure anyone would want to adopt this as a text in a class on international organizations – not as the main text, but as the short, fairly readable critique and counter-view – but I can’t imagine anyone wanting to adopt it at $40 as a supplemental text.

It is true that everyone will discount, starting with Amazon and Barnes & Noble.  But I think that just gets it down to $20 – down to where Hoover starts its pricing.  Whereas I suspect that Amazon will discount the book very quickly to below $15, and I saw on a B&N page that it would sell at $13.50 – straight out of the box.  Now, if I made my living selling books or if Hoover made its living publishing them for a profit, this would be a big problem.  But we are both in the ideas-dissemination business.  We can live with this.  I think people can be persuaded to take a look at this book with a $13 price point (in hard cover, let alone Kindle), whereas at over $20 that is not nearly so likely.  Moreover – and this is very cool – at some point down the road, in a year or two, as sales dry up, Hoover will make the book available free as a pdf off its website.  So if your priority is dissemination of ideas and the book, rather than academic signaling and red queen behavior, this is not a difficult call.

Let me invite your ideas on how I should market this book.  If my aim is dissemination of ideas, getting the book and its ideas out there, both into policy-maker and influencer hands as well as a broader university and interested-public audience, what should I do?  For this kind of book, we are in somewhat uncharted territory.  I’m not self-publishing a Kindle romance novel and this book is not coming from Penguin Press from an established writer with a track record and some built-in audience.  I want to take advantage of social media and the new word of mouth it implies … tell me what my marketing strategy should be.

Jhesus-Maria, King of England, and you, Duke of Bedford, who call yourself regent of the Kingdom of France, you, Guillaume de la Poule, count of Suffort, Jean, sire of Talbot, and you, Thomas, sire of Scales, who call yourselves lieutenants of the Duke of Bedford, acknowledge the summons of the King of Heaven.  Render to the Maid here sent by God the King of Heaven, the keys of all the good towns which you have taken and violated in France.  She is here come by God’s will to reclaim the blood royal.  She is very ready to make peace, if you will acknowledge her to be right, provided that France you render, and pay for having held it.  And you, archers, companions of war, men-at-arms and others who are before the town of Orleans, go away into your own country, by God.  And if so be not done, expect news of the Maid who will come to see you shortly, to your very great injury.  King of England, if you do not so, I am chief-in-war and in whatever place I attain your people in France, I will make them quit it willy-nilly.  And if they will not obey, I will have them all slain; I am here sent by God, the King of Heaven, body for body, to drive you out of all France … (Written this Tuesday of Holy Week, March 22, 1429.)

Joan of Arc, the Maid of Orleans, sends a formal letter of summons to the English upon the siege of Orleans.  (I post this once a year on this date at all the places I blog.)

In the next few years, thousands of “service robots” are expected to enter the health-care sector—picture R2D2 from “Star Wars” carrying a tray of medications or a load of laundry down hospital corridors. Fewer than 1,000 of these blue-collar robots currently roam about hospitals, but those numbers are expected to grow quickly. As America’s elderly population grows, the country’s health-care system is facing cost pressures and a shortage of doctors and nurses. Many administrators are hoping to foist some of the less glamorous work onto robots.

This could create a potential bonanza for software and application developers to write new programs for them, investors and industry watchers say. “My guess is that in five years, there will be 10 times the number of robots deployed in hospitals that there are today,” said Donald Jones, a managing director at Draper Triangle Ventures, who is backing privately held robotics company Aethon Inc. “We are just not going to have enough human hands to do all the work.”

These technologies will piggy-back off of many existing and emerging technologies; some of their first and most important roles will be adaptations of technologies developed for warehouse fulfillment centers such as those used by Amazon.  The hospital environment is chaotic – but it is also a defined space, in the way that a warehouse is.  Hospitals are already designed to work with wheeled machines – smooth floors, elevators, etc. The transition to use machines in place of orderlies is a natural step; more interesting will be as other tasks in the nurse’s repertoire also become highly assisted, if not entirely done, by machine.

The direction of robot design in these kind of consumer uses depends in part, as leading commentator Ryan Calo has noted in several important papers, on the requirements of products liability law.  He suggests in particular that a highly stringent products liability law will push in the direction of smarter appliances – but nonetheless appliances aimed at highly specific tasks.  A less stringent products liability law will enable the development of more flexible robots that gradually become multifunctional – closer to Robbie the Robot of science fiction.

These questions and many other related matters will be taken up in an important conference taking place April 21-22, 2012 at University of Miami law school, “We Robot.”  (I am very sorry I did not get off my bottom and propose a paper for the conference – in my case, probably something by Matthew Waxman and me on autonomous weapons systems.)  This will be the place where all the cool people who are “interested in the social life of things” will be.  I don’t know that there will ever be a field of “robot law”; I have doubts that it is needed as a legal speciality as such – but I do think there are, and will be, many legal questions of how robots will be adapted into broader social life.  The Miami conference (current program here), organized by Michael Froomkin, is a place to begin.

That’s the question behind a new project Brookings has launched in partnership with the Center for the Constitution at James Madison’s Montpelier. The project, about which I am deeply excited, is at one level an attempt to bring to life the most important document in American history that nobody ever reads: Madison’s Notes of the Debates in the Federal Convention of 1787. At another level, however, it is a broader experiment in crowd-sourcing commentary on dense historical texts and in illuminating those texts for the public, for students, and for scholars in new ways.

It also has an interesting story behind it.

For several years now, Brookings and Montpelier have been conducting joint programming on a variety of issues related to the Constitution and contemporary public policy. Montpelier, for those of you who have never visited it, is the plantation of James Madison. The idyllic setting is also the home of the Center for the Constitution, which conducts educational seminars about constitutional thought for a variety of audiences: teachers, police officers, legislators, judges. The Brookings-Montpelier collaboration began as an effort to marry such discussion of Founding Era thought with Brookings work on contemporary public policy. Over time, however, we began talking about ways to expand the collaboration into publications. At one point, I suggested to Sean O’Brien—then the director of the center and now the chief operating officer of the larger Montpelier operation—that perhaps we should jointly publish a new edition of the Notes of the Convention. They are, after all, the best record of the Founding debates we have. And while everyone reads the Federalist Papers, very few lay people touch the Notes, which are dense, written in a kind of shorthand code, and are hundreds of pages long.

When I suggested this, Sean sighed and said that the center had been struggling for some time with what to do about the Notes. Another published volume of them, he thought, was not the answer. Somehow, he wanted to bring the Notes to life—to make it possible for people to be in the room as the delegates in Philadelphia thrashed out what became our system of government. Sean’s spot-on ambition started me thinking: Was there a way to do this using technology, a way that added intellectual value and was not mere kitsch? Could we take a long, impenetrably-difficult text, and tease meaning out of it in a format that people could more easily approach?

There is a model for this sort of thing, but it’s not a model from the American constitutional tradition; it’s the Talmud—the multi-volume exposition of Jewish law that developed after the Romans sacked the Temple in Jerusalem. The Talmud is a series of debates—and commentaries on those debates—on a text called the Mishnah. The rabbis found an ingenious way of commenting on this dry, lengthy text in a language (Ancient Hebrew) which was already in Roman times no longer their vernacular (they spoke and wrote in Aramaic). On a page of Talmud, a passage of Mishnah is physically surrounded by layers of commentary text, more and more of them as the centuries wore on. So in the center of the page is a short passage, by tradition, of course, Divine, but often in practice dry as dust; yet radiating out from that passage is centuries of wisdom and thought. It is not merely a form of crowd-sourced scholarship, but it is a visual means of expressing that scholarship and crowd-sourcing that seemed to me to have broad application to the exposition of lengthy and difficult historical texts like the Notes.

The trouble, of course, was that the Talmud developed over centuries, whereas Sean and I wanted to bring out the Notes now. And that’s where Wikipedia comes in. If the wisdom of crowds can write an encyclopedia, maybe a smaller crowd of scholars and interested lay people could write a commentary on the Notes. Perhaps we could develop a technological architecture that would allow a scholarly community to do over months and years what the rabbis took centuries to do with the Mishnah. This required software development.

The result is ConText, which launched today, Madison’s birthday. Organized like the Talmud, ConText surrounds the Notes with layers of commentary—commentary on the history (what was going on in the room), current events (how these events relate to current politics), theoretical and philosophical issues, and subsequent constitutional interpretation and dispute. Like Wikipedia, that commentary will be written by a scholarly community that develops around ConText: historians, constitutional scholars and practitioners, and interested students and lay people. Both the text and the commentary are fully searchable. And anyone can get an account and begin contributing.

The ConText project is not limited to the Notes, though the Notes represent the core of the experiment. If this platform will support a scholarly community devoted to illuminating this document, there are a great many other Founding Era texts (and texts from other periods), for which it might work as well. I have even flirted with the idea that it might offer a way for the intelligence community to seek analytical input on complicated contemporary unclassified texts from a broad range of scholars from whom it does not normally hear.

So please, check it out. Learn about the Notes, and contribute your knowledge of them and of the later constitutional history that began with them to the project.

This paper will first track the ways in which the legal services market has grown and changed over the past forty years. It will then track the major changes that have attended legal education during the same period and the increasing dependence of the legal education industry on student debt. The paper will then explore why, at long last, the boom-times may have run their course and why, at some point, painful changes will likely occur. Though they cannot be described in detail, the author will attempt to outline the likely nature of the changes that will occur. Finally, the paper will briefly explore how the predicted reckoning may yet lead to an improvement in the marketing of legal services and an enhanced role for law schools in preparing new attorneys for the new bar they will be joining.

He points out that although today’s entry level attorneys are not well-prepared for practice and this is a problem, the sorts of solutions that are proposed – more clinical education, particularly – are often prohibitively expensive.  One might produce better prepared attorneys, but that does not address either an oversupply or tuition prices leading to indebtedness that cannot be supported at the salaries that, even looking over the longer run, even the employed lawyers can support.  Something – several things – have to give.  One of them, he says, will be faculty-student ratios; and the drive for scholarship as the mission of the law school.

Although he hopes to see an undermining of the importance of the USNWR rankings, I don’t think he believes that the new metrics will actually do so.  It is true that USNWR rankings favor almost entirely increasing resources; it is, as he says, a proxy for  institutional wealth.  The rankings overwhelmingly take into account factors that raise the price of education; and of course they are pro cyclical.  That dominance is unlikely to end, however, in part because what employers seek at the end result of the process is, paradoxically, not the best trained junior lawyers – but the best talent.  Apart from a certain common core, taught pretty much by any school, employers do not so much differentiate by training as see school for as proxy for basic talent.

Employers don’t much care if I teach law and robots (which I don’t), because if they had to choose, talent over training, they choose talent, or at least their marker for perceiving it, any day over training.  That marker is irrespective of any big value-added from law school in other words. “Law school” adds a certain basic value in training lawyers, but that is actually about the same across schools, and what separates the schools is who walked in the door in the first place, as reflected in LSAT scores particularly.  I suspect most professors think the same way as the employers do, more so the more elite the school; whether their perception of their students is accurate, however, it does provide a ready-made reason not to worry overmuch about how well one teaches.  The die was cast more or less in the genes.

I don’t think that’s quite fair to us as teachers, however; I think professors at law schools by and large take teaching seriously and the issues are more what should be taught to students.  I would indeed favor professors teaching more classes and, in many doctrinal classes, larger classes.  But we also have to understand that the law is wider and deeper, the doctrinal areas that lawyers need to know and interrelate with one another, the background disciplines that we expect them to have absorbed as practicing lawyers – all that has gotten vastly more complicated since my days in law school.  Teach students attorney skills?  The same folks demanding that are also demanding greater exposure to doctrinal law, and they’re demanding that they know something about accounting and basic business and finance, too.  Expectations of lawyers have gone up, too.  Which is one reason I find talk of making law an undergraduate degree somewhat peculiar.(And I see a number of commenters essentially arguing that lawyers don’t need to know or have formal education in much more than an undergraduate degree in law and some practical training, as is the case in many countries. That’s for another post, but I don’t think that reflects what we expect lawyers in this society and this legal system to know, and to have absorbed from other disciplines.)

Conversely, if law school does not provide very much in the way of value added; if the die was cast, as indicated by LSAT scores; then eventually students will simply skip the purchase of the education and look at their LSAT score first and see what it will buy them.  Anecdotally, I think that is happening now to some extent, despite the hope springs eternal of the young and naive.  As purchasers of the service figure out that it’s basically just sorting, they can do that themselves, and the result?  (Added: no, I don’t think the LSAT is an adequate measure of raw talent, nor does Bourne, but it is what the system has produced in the way of effects.)  Law schools, Bourne says, have lived in a bubble of good times for years, and now the reckoning is upon us.  What will it look like?  Among other things, he focuses on those schools in the first tier below the T-14:

Curtailment of the market for law schools is going to be extremely painful for many schools. The going consensus is that the truly elite schools should survive easily. As their reputations are likely to continue to draw plenty of students and their graduates are likely to be able to retain dominance in the smaller but still powerful large firm market in which entry-level salaries make paying off student loans a reasonably painless operation, truly elite schools are likely to survive if not prosper. What happens just below the elite is more subject to doubt.

Beyond the truly elite institutions, difficulties are likely to reverberate all down the law school pecking order. Many schools with strong national reputations, such as those that fill out the rest of the first tier of U.S.News’ rankings, may have great difficulties surviving in the current environment unless they engage is massive cost cutting. These schools have cost structures that rival “top ten” schools but pay for their status by raising tuition rates for the bottom half of their classes so as to afford discounted tuition and financial aid to well-credentialed students whose admission can enhance their standing in the U.S. News rankings. The shrinking number of jobs available to pay the high cost of going to one of these schools may force them to pull back from the financial aid arms race rather than pay more for what little return they will get from picking up the few top paying jobs available for schools of their rank. As their graduates fight for private employment in mid-sized firms that at least allow them to “break even,” schools in mid-tier positions will find it harder to place their graduates in even “break even” jobs without cost cutting of their own.

Recent commentators have suggested, not without justification, that a number of schools that lack high national reputations may nevertheless be able to weather the storm. Particularly well suited are schools in small, less served markets that never did bite the BigLaw apple, have modest cost structures and strong alumni bases upon which to rely.  State-supported schools, because of the lower student debt levels needed to attend and graduate, are much better off than private institutions with debt levels that are fully 50 percent higher on average.  Downsizing may not be enough.

Cassandra?  Realist?  Moralist and scold?  Your call.

[T]he American Civil War, much like the armed conflicts in which the United States remains involved since the events of 9/11, required that national security strategy and decision making operate “in the dual spheres of criminal law and belligerency.”  Today’s questions of combatant status and the fate of unlawful belligerents, debates over executive powers, controversial habeas litigation, struggles over restraints on civil liberties, executive detentions, trials of civilians before military commissions, questions of whether and when to apply domestic criminal law or the international law of war, and, of course, when does the war end and what are the attendant legal consequences – all these questions figured into the law of the Civil War.

Justice in Blue and Gray, A Legal History of the Civil War, by the eminent historian of public international law and the law of war, Stephen C. Neff, is intended as “primarily a case study of the myriad ways in which law plays an important role in a crisis of giant political and military dimensions.”  This is a work of serious history by a leading legal historian, not a thinly-veiled parable or historical roman-a-clef for the present; it offers no direct connection to our world today, except by the reader’s own inferences.  Still, this legal history offers a not-so distant mirror.  Clear and elegant in its language, understandable to the layman as well as to the lawyer, Justice in Blue and Grayshows how law in war can be used – indeed, was used – to accomplish strategic and operational war fighting objectives in a vast and bloody conflict.  To use a word Neff does not use (and a somewhat controversial word in today’s parlance), this is a study of law in the Civil War as lawfare.  It would be something of an understatement to say that these understandings – both as icon from the past but also source of live legal precedent – are entirely in play in the most recent round of speeches by the Administration’s senior legal officials seeking to explain itself and its justifications in Guantanamo detention, trials, targeted killing, and the targeted killing of Americans.  The recent speeches by Attorney General Eric Holder, DOD General Counsel Jeh Johnson, DOS Legal Adviser Harold Koh, and others can profitably be read with this book to hand.

At the level of grand strategy, all lawfare is a battle for legitimacy.  To be sure, other objectives – operational and tactical — may flow from that source, but legitimacy is always the underlying and fundamental legal objective.  Thus, for the nascent Confederacy, a key initial strategic objective was recognition as a sovereign nation state, and the potentially decisive foreign alliances, particularly with Britain, that could flow from the establishment of that legitimacy.  For the Union, an initial strategic objective was to prevent any such recognition and concomitant legitimacy.  And so the first and richest chapter of Justice in Blue and Gray discusses the legal arguments surrounding the act of secession by the southern states.  Upon the answer to these fundamental legal questions would depend not only whether the secession and a fight either to maintain it by one or to stop it by the other could be held legitimate, but also whether what followed would be law enforcement or war – and thus what measure of violence could legitimately and lawfully be taken by either side to suppress or perfect the secession.

The Court’s order may reflect that a majority or plurality of the justices would like to decide the case on the larger issue of whether the Alien Tort Statute even applies to torts committed in other countries, rather than on the narrower issue of corporate liability, and that other justices want to have more briefing on the issue, which was not addressed by the Second Circuit. As I noted in my post about last week’s oral argument, Justices Kennedy, Roberts, and Alito focused almost all of their questions on the diplomatic tensions and problems under international law caused by extraterritorial application of the ATS. This was also the issue that I addressed in my own amicus brief, and that was the focus of the amicus briefs of the Netherlands, Britain, and Germany ….

This development will put the Obama Administration in a difficult position. In its original amicus brief in support of the petitioners, the Administration argued in favor of corporate liability, but made no mention of the numerous diplomatic complaints about the ATS filed by other countries. Assuming that the Administration files a new amicus brief, it will face a dilemma. It will either have to argue against extraterritorial application, contrary to the position of human rights groups and undercutting its prior argument in favor of corporate liability. Or it will have to argue in favor of extraterritorial application of the ATS (at least in some circumstances), which is contrary to the position of many foreign governments and inconsistent with international law principles of jurisdiction. As three members of the International Court of Justice said in the Congo Arrest Warrant case, “[w]hile this unilateral exercise of the function of guardian of international values has been much commented on, it has not attracted the approbation of States generally.” Moreover, the Obama Administration would have to reverse the arguments against extraterritorial application of the ATS made by the Bush Administration in its brief to the Supreme Court in 2008 in the Apartheid case (which the Solicitor General may be reluctant to do). This may be one reason why the Administration asked the Supreme Court not to address the issue of extraterritoriality in its original amicus brief.

One might add that the amicus brief drafted by Harvard Law School’s Jack Goldsmith in support of defendant corporation Shell has had an effect; Goldsmith and his amicus brief were mentioned by name in the oral argument.  This was the point – noted by (swing) Justice Kennedy – that other countries don’t do this, don’t believe such a mechanism is part of or consistent with international law, and believe it makes a hash of ordinary principles of jurisdiction.  Goldsmith’s brief was not even primarily about extraterritoriality – it was about whether this was international law as such, or instead some kind of well-intentioned but nonetheless faux-international law committed to the hands of US courts.  (I have sometimes referred to it here and at Opinio Juris as the “law of the hegemon” which US district courts have been persuaded by ATS plaintiffs’ lawyers, mistakenly, to regard as “international law.”)

This then combines with a general worry on the part of Justice Alito – but not he alone – that particularly the alien-to-alien cases taking place in an alien land simply have no reason to be in US courts, and that what little can be gleaned about the history and purpose of the statute does not support extraterritorial application, at least in the territory of another sovereign.  Piracy on the high seas, yes – and hence presumably the importance of the qualifier in the Court’s briefing instructions to address not extraterritoriality as such, but instead territory of another sovereign.

There are things I wish could be got in front of the Justices that I, as a non-litigator, don’t really know how to frame in briefing terms.  One is the confusion between international law and “law of the hegemon.”  Another is that there are many real-world problems of perverse incentives created by the breadth of the ATS.  The most obvious is that the best is the enemy of the good.  Is it really such a good idea to push Western countries’ corporations out of places like Sudan and leave them to the investment practices of Chinese corporations?  (Added:  It is of course true that the concerns about perverse incentives can run the other way, such as the incentive to locate in some place with weak environmental or labor regulation in the first place; my view is that those are more widely understood as background assumptions than these other less visible incentives problems, and I think the ones I raise here are more important than commonly understood, so I concentrate on them here.)

This problem of pushing out pretty good companies that are subject to real human rights pressures in a regulatory way – provided that they don’t conclude that the risk of damages, bad publicity, etc., makes it more prudent to sell to Chinese companies – is exacerbated by Sosa standards, ironically.  Sosa (the Court’s last and not very successful – Delphic, mostly – attempt to standardize ATS jurisprudence) says the norms alleged to have been violated have to be really serious – genocide, crimes against humanity, slavery, piracy, that sort of thing.  So: you are the senior executives and board of directors of some American or Canadian company that has invested in a rubber plantation in Africa somewhere; well aware of the public relations, legal, and damages issues involved in various labor practices, particularly child labor, you have various systems in place, but you know perfectly well they won’t be perfect.

When the ATS lawsuit comes, however, in order to make it out under Sosa, your company and perhaps you personally are accused of slavery and maybe crimes against humanity.  Not merely violations of labor practices under some jurisdiction – but slavery.  We are all aware of the bad publicity problems for the company – but often neglected is the fact that these executives think these charges are horribly unfair and vicious to them personally, and way outside of the scope of litigation that ought to be applied – labor regulatory standards, at a level suited to determining if there are adequate safeguards in place, fines, sure, serious deterrents, sure, but slavery?  They take it personally.  Occasionally they fight, because they want to clear their own names.  But often business prudence prevails and they settle quietly.  But – they often decide, if they hadn’t decided long before, to avoid the whole ugliness and sell the business.  Is that such a good idea?

Back in the 1990s, a human rights organization asked me to go to Guatemala, a country I knew well, to look at the labor practices of a shirt manufacturer that operated maquiladoras there.  The head of the company was a leader in labor and environmental standards in his business, and the organization made a point of inviting him onto its board in an experiment in trying to find common ground with progressive business leaders.  Now his company was accused of child labor violations and various other things.  So I went down to look and didn’t find much.  This wasn’t about the ATS, to be sure, though it might have morphed into a suit.  Instead what remains most important today was the conversation with the then-labor minister in Guatemala, an ex-leftist who had been with the opposition during the civil war and whose not merely progressive, but revolutionary, credentials were impeccable.

When I told him that there was pressure for this company to close its plant, he was aghast.  He said, in impassioned terms, this would be terrible.  The company might have had an occasional child labor violation, he said, but it had inspectors who were clean, it offered child care, a clinic, and sent the kids of the women to school, and provided milk for the families.  None of the Asian maquiladoras would ever consider such a thing – on the contrary, they fired the Indian girls immediately if they found out they were pregnant (what he actually said was, I know of one maquiladora from Asia where the security guard threatens to punch the women in the stomach when they come in the door to start work to see if they will say no because they are pregnant).  I have hundreds of illiterate peasant girls streaming into the city every month, he said – I want your American company to open dozens more plants to absorb them, on these terms.  It’s that or prostitution.

The American company decided the potential bad publicity wasn’t worth it and closed the plant; I’m sure the marginal, if tiny, increase in Central American labor costs had something to do with it as well.  But note:  the human rights advocates were not unhappy with that decision.  Since they had no welfare obligations for the Indian women at stake, they could afford to stand on perfect principle; no hard tradeoffs for them.  Not so the labor minister.

Now, this is not about the ATS as such and I have no idea how one gets that notion of forward looking incentives before the Court.  But I would hope that these kinds of incentives questions could be inserted into the discussion somehow.  At a minimum, one might wonder whether the 18th century ATS – a one-sentence statute – is sufficient ground for the judiciary to supervise these incentives and tradeoffs, or whether these are deep policy questions which Congress would have to commit more explicitly, and in some kind of serious statutory framework, over to the District Courts for adjudication.

In a related development on targeted killing and Anwar Al-Awlaki, Robert Chesney notes:

In late January, Daniel Klaidman reported that the administration was inclined to have Attorney General Holder give a major speech specifying additional details regarding the legal framework governing the use of lethal force against Anwar al-Awlaki. That time has now arrived. DOJ released a statement last week indicating that the AG will give a major address on national security at Northwestern Law (congrats to NW’s new dean–and my former colleague–Dan Rodriguez for landing this rather big fish) at 3:30 central time this Monday (the 5th).  Once the text is available, we will certainly have a link to it, and commentary [at Lawfare].

[G]etting VC funding for robotics is a decidedly tough nut to crack. Robotics companies have large capital requirements for robot hardware, few potential acquirers, and almost no “Google-scale” breakout success stories (ie. IPOs). I mean, c’mon… one of the best known robotics companies, iRobot, has a market cap of just $700 Million. This makes robotics a difficult sell to your typical VC firm. My hope is that this list can give others courage to pursue “swing for the fences” type projects along with a source for robotics-friendly VC firms.

Today the Supreme Court is hearing oral argument in Kiobel v Royal Dutch Petroleum (and a companion case) – one of the more important and interesting cases involving international law and foreign relations law of the United States in recent years.  The essential legal question is whether corporations can be held liable under the Alien Tort Statute. Rather than attempt to summarize it all here, let me point readers to a couple of sources.

In the Washington Post over the weekend, former Legal Adviser to the State Department John Bellinger argued that the Court should rein in the ATS and not permit corporate liability; he also has additional commentary at the Lawfare blog.  At the Opinio Juris blog, various commentators on all sides of the issue are offering guest posts; my colleague and friend at American University, Juan Mendez, who is also the UN special rapporteur on torture, has a post arguing that corporations must be held accountable for torture and other serious violations of human rights.  If you would like to read the dizzying array of amicus briefs, go to this link.

My own view, as I’ve said several times here at Volokh and at Opinio Juris, is that the Federal judiciary is under the mistaken impression that its expansive interpretations of the ATS, to reach extraterritorially as a form of universal civil jurisdiction against juridical entities, are “international law.”  I think what’s actually going on is that US courts are creating a sort of faux-international law, calling it international law (and genuinely believing it), while instead creating something closer to the “law of the hegemon.”

Was this possibility priced into the bonds?  Or correctly priced-in? I myself find it hard to believe that it was, though without any evidence to speak of. But there are two excellent papers on these topics by Stephen Choi, Mitu Gulati, and Eric Posner that bear reading.  The first, last updated in March 2011, is “Pricing Terms in Sovereign Debt Contracts: A Greek Case Study with Implications for the European Crisis Resolution Mechanism”; the second, posted November 2011, is “Political Risk and Sovereign Debt Contracts.”

But one of the reasons for my empirically unsupported intuition about pricing choice-of-law terms in European sovereign debt is simply my perception that the market (up until the sovereign debt crisis hit the newspapers) consisted of people for whom the issue was fundamentally interest rate risk, not credit risk.  So I was interested to see this post today at Zerohedge, attributed to Hypo Capital Management.  Ordinarily, I find Zerohedge a bit too edgy and conspiracy-theory oriented for my taste, but if the folks in this guest post have done the work they report here, I think it is quite interesting and important.

HCM say they have managed to walk through a sample of individual sovereign debt issuances, looking at debt covenants and choice-of-law clauses particularly, comparing local law and foreign law issuances.  They then plot these as yield-to-maturity against maturity, separating the local and foreign law-governed bonds to see whether there is a separation, for Greece, Italy, and several others.  Thus:

We did the unthinkable, read the unreadable and made it back alive to tell the tale: we ploughed through all of the individual bond prospectuses of our favorite list of countries in peril and actually found a lot of useful information for the investor. Given that the sovereign bonds of the Eurozone used to be looked at as riskless assets, it is safe to assume that the exercise hasn’t been done by a lot of investors on a regular basis. Judging by the difficulty to even obtain the information, both the interest of investors to obtain it and that of issuers and underwriters to provide it has been and remains extremely limited. [Emphasis added]

Well, good for them (I’ve since spoken with some market friends who tell me that others are busily doing the same exercise, but I don’t know what conclusions others have reached and haven’t had time to look).  The countries they looked at were Greece, Portugal, Italy, Austria, Hungary, and Spain.  Their conclusion is, excepting Greece, there remains a potentially significant mis-pricing of sovereign debt because prices continue to reflect the assumption that there is no important divergence created by choice-of-law clauses in the debt.  Which is to say, no political-legal risk in the countries listed above, apart from Greece, running to debt governed by local law rather than foreign law.  Which is also to say, the assumption of the markets continues to be that (excepting Greece) pari passu means pari passu:

In our view, the state of the crisis warrants a broad-based significant markup for investor-friendly prospectus language and we see trading opportunities in most of the countries we analyzed …. Establish selective long/short pair trades in maturity-matched foreign/local bonds, or go long foreign law bonds and hedge via CDS.

I have not tried to reproduce their graphs here; you can see them at Zerohedge.  Their broader comment is worth reproducing, however (emphasis added):

Relative illiquidity and low issuance sizes distort yields and spreads. Investors traditionally shunned foreign law bonds and piled into local law issues. This may seem puzzling at first glance, given the duration and severity of the crisis. We attribute this to the investor base: their thinking remains entrenched in traditional categories, namely interest rate risk as opposed to credit risk. Only when the threshold is clearly crossed -as in the case of Greece- does duration-based pricing make way for default-based pricing and a different investor base takes over. When Greece lost its last IG rating, it disappeared from the universe of EZ government bond managers and entered the realm of HY bond investors. Thus credit criteria began to matter and were being priced in. In our view, the state of the crisis warrants a broad-based significant markup for investor-friendly prospectus language and we see trading opportunities in most of the countries we analysed.

I am not sure I understand – or agree – with all their thinking here.  They say that investors shunned foreign law bonds and instead bought local law bonds.  Is that what the evidence (see their charts at ZH) or their deductive argument suggests?  It seems to me they argue that investors had reason to be, and in fact were, indifferent as between legal regimes governing the bonds.  That does not alter the conclusion that there might well be a mis-pricing opportunity as between foreign and local law bonds, but I don’t see that it arises strictly from a preference for one over the other, rather than indifference.