GUULR Blog

Amazon, Antitrust Law, and the Consumer Welfare Standard

By KAARISH MANIAR


Early in the year 2000, United States District Judge, Thomas Penfield Jackson, ruled that Microsoft Corporation, in “unlawfully tying its Web browser to its operating system,” behaved in an anticompetitive manner, thereby violating the Sherman Antitrust Act. Later that year, in June, the court ordered Microsoft to break up the two functions into separate units.[1] The antitrust action against Microsoft created an opportunity for new tech giants to rise;[2] among those younger monopolists was Amazon. Enjoying baffling 75% and 44% market shares in the electronic books and online commerce industries respectively, Amazon seems to be infiltrating every sector of consumer-focused commerce.[3] Likewise, companies like Wal-Mart, Apple, Google, and Facebook also dominate their markets, creating a situation akin to one in which the nation found itself just over a century ago. In 1911, President William Howard Taft declared that the country needed to decide between a socialist future, or one with “legitimate and independent competition.”[4] If we are to choose the latter, as did Presidents Taft and Wilson, American antitrust laws must be reformed so as to be made relevant to the economic issues confronted today.

As the law is currently written, the American consumer’s interest is paramount. Dating back to 1890, the Sherman Antitrust Act was designed to prevent large railroad and oil conglomerates from becoming monopolistic behemoths and subsequently causing a significant restraint on free trade. Thus, it aimed to ensure that large corporations were competitive on the grounds of low prices and high quality, but the Supreme Court limited its scope to prohibit ‘unreasonable’ restrictions on free trade, not just any restriction.[5] In 1914, Congress passed the Federal Trade Commission and Clayton Acts which further specified the Sherman Act. While the FTC Act slightly expanded the Sherman Act, to include “unfair methods of competition,” the Clayton Act prohibits mergers that may substantially lessen competition or have monopolistic tendencies.[6] These three pieces of legislation form the consumer welfare standard, which essentially narrows the scope of antitrust violations to acts which have the tendency of harming the consumer via price hikes, compromised quality, or reduced access.

However, unlike the “respected but unloved” commercial giants to whom these antitrust laws were originally addressed, the companies in question today enjoy warm reception from consumers.[7] Specifically, Amazon has become the ever-expanding entity it is precisely for its ability to provide efficient customer service while offering low prices for the same high-quality products. Amazon’s immediate threat is not to the customer. Rather, it poses a threat to the livelihood of capitalism as a system. In systematically wiping out its smaller competition, Amazon has made itself a commodity for both consumer and supplier. Amazon has become online customers’ go-to for any type of product. Moreover, it has come to control the way small businesses go about their business. Without selling as a third-party through Amazon, small businesses have little chance of winning substantial profits in the world of e-commerce. But with Amazon’s strict customer service policies, these small businesses are forced to sell at margins and abide by policies they simply cannot afford.

Furthermore, Amazon has managed to pose a challenge to some of the most stalwart names in retail for the past several decades. Companies such as Macy’s, Sears Holdings, JCPenny, and Kohl’s are closing massive portions of their brick-and-mortar storefronts, creating a surplus in available retail real estate. The blows to these massive companies will in turn impact the 16.5 million Americans, nearly 10% of the workforce, employed by the retail sector.[8] Although this “Amazon Effect”[9] is not necessarily detrimental to the consumer in the short run, by systematically removing competition from every industry, it proves to be a present threat to capitalistic competition. Indeed, Amazon, among other large rising giants, displays market shares similar to the trusts of the late 19th and early 20th century.[10] However, unlike those earlier trusts, these mammoth conglomerates prey on different victims. If we are to protect smaller and small businesses, as well as retail jobs, Amazon, and similar companies, must be domesticated with methods appropriate to the new creature. Antitrust laws from the 20th century simply will not suffice.

Thus far, little has been done to hinder Amazon’s growth. The lack of action is partly due to the government’s inability to sufficiently prove a violation of either the Sherman or Clayton Acts, and partly due to a fear of stifling innovation. Like similar leading tech companies, Amazon re-invests a large sum of its earnings in researching and developing new products and technology.[11] However, the idea behind a capitalist system is that more competitors yield more innovation. If we buy into the idea of a capitalist economy, we must ensure that it functions per capitalism’s principles. Currently, antitrust laws speak nothing of the issues Amazon raises. If the government is unwilling to creatively apply the existing law to the issue at hand, as they did with Microsoft, then Congress must re-design the laws to create a proper framework in which to foster competition.

An alternative to the consumer welfare standard is the Democrats’ “Better Deal” proposal. Such a scheme would aim to prevent mergers that “reduce wages, cut jobs, lower product quality, limit access to services, stifle innovation, or hinder the ability of small businesses and entrepreneurs to compete.”[12] Unlike the consumer welfare standard, a multifaceted guideline such as the Democrats’ is certainly more subjective. While the language demonstrates a move in the right direction, the nation needs a middle ground that reflects the same intent with more practicable provisions. Whereas the Sherman, Clayton, and FTC Acts were adequate in controlling companies that preyed on the consumers, new legislation is unquestionably required to protect America’s small businesses, retail jobs, and long-term technological innovation.


[1] Joel Brinkley, ” U.S. Judge Says Microsoft Violated Antitrust Laws with Predatory Behavior,” The New York Times, April 03, 2000, accessed March 07, 2018, http://www.nytimes.com/2000/04/04/business/us-vs-microsoft-overview-us-judge-says-microsoft-violated-antitrust-laws-with.html.

[2] Jed Graham, “The Amazon Monopoly Problem: Prime Time For Antitrust Action Vs. Internet Giants?” Investor’s Business Daily, September 18, 2017, accessed March 07, 2018, https://www.investors.com/news/technology/amazon-monopoly-problem-antitrust-action-vs-amazon-facebook-google/.

[3] Greg Ip, “The Antitrust Case Against Facebook, Google and Amazon,” The Wall Street Journal, January 16, 2018, accessed March 07, 2018, https://www.wsj.com/articles/the-antitrust-case-against-facebook-google-amazon-and-apple-1516121561.

[4] Harry B. McMeal, Telephony, vol. 61 (The University of Michigan, 1911), 451, October 30, 2009, accessed March 7, 2018.

[5] “The Antitrust Laws,” Federal Trade Commission, December 14, 2017, accessed March 07, 2018, https://www.ftc.gov/tips-advice/competition-guidance/guide-antitrust-laws/antitrust-laws.

[6] Id.

[7] Supra note 3.

[8] Adam Hartung, “How The Amazon Effect Will Change Your Life And Investments,” Forbes, March 02, 2017, , accessed March 07, 2018, https://www.forbes.com/sites/adamhartung/2017/02/28/how-the-amazon-effect-will-change-your-life-and-investments/#4212e52a5e76.

[9] Id.

[10] Supra note 3.

[11] Id.

[12] Supra note 2.

Consumer Protections in the New Economy: Antitrust Implications of Ohio v. American Express

By MATTHEW SCHNEIDER


The ever-changing economy of the 21st century has transformed the ways Americans work and spend their money. Accordingly, firms in newer technology-driven sectors have become some of the dominant forces in the business world, and have consolidated unprecedented amounts of power in their markets. For example, companies like Google and Amazon have dominated their respective industries (search engines and e-commerce), while companies in older industries have engaged in numerous mergers and acquisitions to increase their market power amid a variety of economic changes (such as in banking and airlines) [1, 2, 3]. As such, the increased concentration of critical American industries in the hands of just a few firms has made antitrust law in the United States even more important than ever. One case being considered in the Supreme Court, however, could jeopardize the Department of Justice’s ability to litigate on behalf of consumers when they are threatened with anticompetitive business behaviors.

In late February, the Supreme Court considered the case of Ohio v. American Express. The case revolves around credit card company American Express’s use of anti-steering provisions, which instruct merchants that they cannot charge consumers who use their card more than they charge users of other cards, namely those issued by Visa, Mastercard, and Discover (the other three major credit card companies) [4]. While the provision is not inherently anticompetitive, what might be problematic—and what is at the heart of this case—is that American Express charges more to merchants who accept its card per transaction than the other card companies do, and prevents merchants from disclosing the fees they pay to credit card companies [5]. This leads to higher costs for merchants, who in turn might pass on these costs and raise the prices of their goods or services for all consumers. This is the argument presented by the state of Ohio and several other states that have joined the lawsuit, as well as the Justice Department, which has sided with the states [6].

American Express, however, has argued that these provisions have allowed the company to compete with the far larger Visa and Mastercard, which have more widespread networks of merchants and more consumers who utilize their cards, and thereby can afford to charge lower fees to merchants [7]. Initially, a district-level court sided with the plaintiffs, arguing that such anti-steering provisions violated the Sherman Antitrust Act [8]. This ruling was reversed, however, under the Second Circuit court, which stated that the states and Justice Department did not establish that such fees were harmful to consumers in addition to merchants. This ruling put the burden of proof on the plaintiffs to establish that the provisions were truly anticompetitive [9].

This case is important because American Express and credit card companies in general operate in what is called a “two-sided market.” This means that these types of companies serve two groups: the first being merchants who must decide whether or not to accept certain cards in their places of business, and the second being consumers, who select which card they will use [10]. Credit card companies are not the only firms that operate in two-sided markets; indeed, many technology companies utilize this market set-up as well. For example, Facebook operates in a market where it seeks to get consumers to utilize its social networking application, while also attempting to get advertisers to pay to use their platform to market to consumers using the application. Google and other search engine companies operate in a very similar fashion. Meanwhile, Amazon links consumers and other companies as well, with consumers using the platform to purchase items and companies and other merchants using the platform to make sales [11].

Given the marked similarities in the business models of both credit card companies and technology companies, Ohio v. American Express will inevitably have highly significant implications for these industries, even though the case just involves the former. If the Supreme Court accepts the decision of the Second Circuit Court, this could set a precedent that could allow tech companies to argue in the future that price increases on one side of the market do not necessarily entail anticompetitive behavior, putting the burden of proof on consumers and the plaintiffs in antitrust cases to prove that harm was done [12]. Several technology companies have noticed the value in establishing this precedent, and an industry trade group, the Computer and Communications Industry Association, has submitted an amicus brief on behalf of the likes of Amazon, Google, and Facebook, in favor of the ruling of the Second Circuit [13].

Given these circumstances, it appears that there a lot at stake in Ohio v. American Express. The exchanging economy of recent years has left many potential loopholes that new types of companies can exploit to increase their profitability and shut out competition. The rapid developments that characterize the new American economy have left traditional antitrust law behind, and this case proves that it needs to catch up as new types of business models arise. Should the Supreme Court side with the plaintiffs in this case, this could ensure that antitrust law continues to operate in the way that it was intended to: to protect consumers from corporate behavior that increases profitability at the expense of harming consumers.


Works Cited:

[1] Khan, Lina. “The Supreme Court Case That Could Give Tech Giants More Power.” The New York Times, The New York Times, 2 Mar. 2018, http://www.nytimes.com/2018/03/02/opinion/the-supreme-court-case-that-could-give-tech-giants-more-power.html.

[2] Schaefer, Steve. “Five Biggest U.S. Banks Control Nearly Half Industry’s $15 Trillion In Assets.” Forbes, Forbes Magazine, 3 Dec. 2014, http://www.forbes.com/sites/steveschaefer/2014/12/03/five-biggest-banks-trillion-jpmorgan-citi-bankamerica/.

[3] Yellin, Tal. “The Runway to the Final Four.” CNNMoney, Cable News Network, money.cnn.com/infographic/news/companies/airline-merger/.

[4] Goldfein, Shepard, and Karen Hoffman Lent. “The Supreme Court Takes on Two-Sided Markets.” Yahoo! Finance, Yahoo!, 9 Feb. 2018, finance.yahoo.com/news/supreme-court-takes-two-sided-074522009.html.

[5] White, Deborah. “Supreme Court Case Seeks Disclosure of Credit Card Fees to Benefit Consumers.” Fox News, FOX News Network, 24 Feb. 2018, http://www.foxnews.com/opinion/2018/02/25/supreme-court-case-seeks-disclosure-credit-card-fees-to-benefit-consumers.html.

[6] Wheeler, Lydia. “Supreme Court Agrees to Hear American Express Case.” TheHill, 16 Oct. 2017, thehill.com/regulation/court-battles/355721-supreme-court-agrees-to-hear-american-express-case.

[7] Chung, Andrew. “U.S. Supreme Court Liberals Skeptical of American Express Merchant…” Reuters, Thomson Reuters, 26 Feb. 2018, http://www.reuters.com/article/us-usa-court-american-express/u-s-supreme-court-liberals-skeptical-of-american-express-merchant-fees-idUSKCN1GA2BU.

[8] Farmer, Beth. “Argument Preview: Antitrust Analysis – Do Two-Sided Markets Require Different Rules?” SCOTUSblog, 20 Feb. 2018, http://www.scotusblog.com/2018/02/argument-preview-antitrust-analysis-two-sided-markets-require-different-rules/.

[9] Ibid.

[10] Goldfein, Shepard, and Karen Hoffman Lent. “The Supreme Court Takes on Two-Sided Markets.”

[11] Khan, Lina. “The Supreme Court Case That Could Give Tech Giants More Power.”

[12] McLaughlin, David. “U.S. Supreme Court Weighs Amex Rules in Antitrust Enforcement Test.”Bloomberg.com, Bloomberg, 26 Feb. 2018, http://www.bloomberg.com/news/articles/2018-02-26/amex-rules-weighed-by-high-court-in-antitrust-enforcement-test.

[13] Ibid.

 

Understanding the Modern Day Slave Trade: Sex Trafficking and the Criminal Justice System in the United States

By CYNTHIA KARNEZIS


Sex trafficking constitutes a form of modern day slavery[1] as it denies victims their agency and reduces them to mere object status by shamelessly exploiting their bodies for economic gain[2]. Current laws do not explicitly define “modern slavery”, yet the terminology refers to sex trafficking and other forms of exploitation that a person cannot escape due to threats, coercion, violence, deception, and/or the abuse of power (3). According to the U.S. State Department’s Office to Monitor and Combat Trafficking in Persons, people may be victims of trafficking: “whether they were born into a state of servitude, were exploited in their home town, were transported to the exploitative situation, previously consented to work for a trafficker, or participated in a crime as a direct result of being trafficked”.[3] Essential to the phenomenon of sex trafficking is the traffickers’ goal to (1) exploit and (2) enslave their victims through deceptive and controlling practices.[4]

In 2012, the International Labor Organization estimated that there are 20.9 million victims of human trafficking at any given time internationally.[5] 22% of these global human trafficking victims (4.5 million individuals), are specifically sex-trafficked[6]. According to the United Nations Office on Drugs and Crime Global Report on Trafficking in Persons, sexual exploitation constitutes the most common form of human trafficking worldwide (79%), followed by forced labor at 18% in activities like agriculture, domestic work, or manufacturing[7]. Nonetheless, sex traffickers disproportionately prey on women, as females constitute 97% of victims of sexual exploitation worldwide, compared to other types of human trafficking, such as forced labor, where only 35% of trafficked victims are female[8]

In a domestic context, the best estimate for the number of trafficked victims comes from U.S Department of Health and Human services who cite that roughly 600,000 to 800,000 victims — half of whom are younger than 18 years old — are trafficked each year across American borders[9]. Roughly 80% are female, and 70% are believed to be trafficked into the sex industry as opposed to other forced labor industries[10]. Furthermore, 199,000 children annually are estimated to be victims of sex trafficking in the United States[11]. The U.S Congress reports that the sex trafficking of women and children is the third largest source of revenue for organized crime worldwide, following closely behind illegal drug and firearm sales[12]. According to the Urban Institute’s comprehensive 2014 report on the size and structure of the underground commercial sex industry in the United States, the city of Atlanta’s 2007 sex economy alone was estimated at 290 million dollars[13]. As world renowned activist and human trafficking expert Siddarth Kara states:

Drug trafficking generates greater dollar revenues, but trafficked women are far more profitable. Unlike a drug, a human female does not have to be grown, cultivated, distilled, or packaged. Unlike a drug, a human female can be used by the customer again and again[14]

Kara’s piercing words illuminate one of the many reasons why the sex trafficking industry has flourished, yet remains difficult to criminalize. In order to grasp the immense scope of the problem in the United States, it is important to first understand the reasons why criminalizing, controlling, and eradicating the industry prove difficult. (1) The Ills of Globalization details the adverse effects of globalization on women and illuminates how poverty increases their vulnerability to traffickers. (2) The high reward / low risk nature of the sex trafficking industry delineates the lucrative economy of the U.S sex trafficking industry. Lastly, (3) Ambiguity of the TVPA & Other Legislation unravels current understandings and legislative definitions for trafficking that lead to misunderstanding what constitutes sex trafficking and the uneven applications of the law.

  1. The Ills of Globalization

The top three types of sex trafficking services in the U.S as of 2016 are (1) Escort Services (2) Illicit Massage Businesses, and (3) Residential (e.g apartment brothels)[15]. Conditions of poverty, unemployment, and other forms of economic dislocation primarily force women and girls into sex trafficking, according to Article 6 of UN Convention on the Elimination of all forms of Discrimination against Women (CEDAW) in its 11th meeting in 1992[16]. Specifically, runaway/homeless youth, victims of domestic violence, sexual assault, war or conflict, or other types of social discrimination are targets for sex traffickers[17]. Globalization plays a toxic role in the proliferation of the modern day slave trade as it creates circumstances which force women into sexual exploitation[18]. Namely, a widening divide exists between the rich and poor as a result of globalization due to the transfer of commodities and assets (e.g people) from developing nations into rich, already developed nations[19]. This freer exchange of goods and people catalyzed the sex trafficking industry. Women, children, and minorities are the hardest hit by socio economic crises, thus, these they are the most heavily trafficked groups[20].

Sex trafficking victims themselves often respond that economic hardship and childhood trauma pushes them into the trade, thereby making them susceptible to countless methods of control by traffickers, like force, fraud, and coercion[21]. Traffickers commonly withhold victims’ travel and identity documents and threaten that they will call police or immigration authorities (if the victim’s country of origin is not the United States) if the victim attempts to escape, according to a foundational 2005 Dept. of Justice report analyzing the American sex-trafficking epidemic[22]. Pimps also recruit young U.S women in malls or clubs, typically befriending them first, and creating emotional and/or drug dependencies as a method to maintain control[23]. Consequently, fully eradicating the industry lies in abolishing the forces which drive women into the sex-trade, specifically economic globalization and poverty, which proves a monolithic undertaking[24].

  1. The high reward / low risk nature of the sex trafficking industry

The economics of the U.S sex trafficking industry itself also make it difficult to criminalize and eradicate long-term. According to the 2014 Urban Institute report on the sex trafficking industry across eight major American cities, 142 interviewed (and convicted) pimps said that there exists a perception that trafficking is far less risky than other crimes, like drug trafficking, for example[25]. While pimps have varying degrees of knowledge regarding the law itself, they overwhelmingly believe that arrest remains the foremost risk of pimping[26]. Multiple offenders in the study expressed that “no one actually gets locked up for pimping”, despite their own incarcerations[27]. From an economics stance, forced sexual exploitation proves incredibly lucrative due to constant demand since men will always desire to pay for sex[28]. The low price of sex from slaves incentivizes men to participate in this illicit activity (as opposed to more expensive prostitutes or escorts)[29]. Slaves become commodities, where price drives demand, rather than empathy for their condition[30]. Beneath the surface of massage parlors and escort services, there exists an extensive network of conventional business techniques like “advertising (e.g online ads, social media), renting business locations, the transportation of workers, communication, internal business structure organization, and financial transactions and recordkeeping” that keeps the illicit industry alive[31]. One of the main issues that arises from attempting to criminalize sex trafficking is that pimps consciously elude law enforcement by using coded online ads and coded communications between themselves and employees, for example, while employing tactics to proactively identify law enforcement stings[32].

  1. Ambiguity of the TVPA & Other Legislation

Despite popular sentiments among traffickers that sex trafficking does not constitute a crime,[33] the U.S enacted its first anti-trafficking legislation in October 2000, called the Trafficking Victims Protection Act, or TVPA[34]. A federal policy advisor who took part in drafting the law contends that the TVPA provided a new and highly needed category under which sex trafficking cases in the United States could be prosecuted. He notes that everything prosecuted under the TVPA technically could have been taken to court under pre-existing statues; nonetheless: “it was very important from the United States’ perspective to be seen as a leader in the area and pass a statute that had a crime called ‘trafficking’ because we were encouraging everybody else in the world to do it, and other countries did not have the tools that we already had.”[35]

Several high profile cases brought sex trafficking to the national agenda in the 1990’s, highlighting the pre-existing law’s insufficiency to criminalize the complex issue[36]. The TVPA outlines an operational definition for “severe forms of trafficking” (which includes trafficking for forced labor/servitude and trafficking for sexual exploitation) and a non-operational definition for non-severe types[37]. Nonetheless, “severe” forms of trafficking embody the core of the law and include:

(A) sex trafficking in which a commercial sex act is induced by force, fraud, or coercion, or in which the person induced to perform such act has not attained 18 years of age; or

(B) the recruitment, harboring, transportation, provision, or obtaining of a person for labor or services, through the use of force, fraud, or coercion for the purpose of subjection to involuntary servitude, peonage, debt bondage, or slavery [38]

The U.S definition requires the presence of 1. a process (e.g recruitment, harboring, or transportation), 2. occurring by means of certain methods (e.g force, fraud, or coercion) and 3. ending in exploitative conditions of labor or commercial sex to qualify as a severe form of sex trafficking[39]. Reauthorizations of the TVPA took place in 2003, 2005, 2007, and 2013[40] to: strengthen its prevention strategies, create programs to assist state and local law enforcement to combat trafficking, and expand protections available to non U.S citizens with the T-visa program (special, three-year-residency visas provided to victims of severe forms of human trafficking), to name a few addendums.[41]

TVPA legislation coincidentally coincided with the drafting of international UN sex trafficking protocol[42]. In December 2003, UN Nation States entered into legally binding guidance in The Protocol to Prevent, Suppress and Punish Trafficking in Persons, especially Women and Children, that establishes a definition of trafficking in persons to facilitate convergence in approaches across countries to criminalize human trafficking[43].The TVPA and UN Protocol, however, boast holes in their policies[44]. Their ambiguous and subjective language primarily leads to confusion and implementation of the law[45].

Domestic Response

Luckily, America boasts federal legislation unlike many countries who comprise the UN, nonetheless, TVPA guidelines remains far from comprehensive in combating sex trafficking. Although elements of “force, fraud, or coercion”, as cited above, are required for a case to qualify as trafficking, precisely determining what circumstances and conditions constitute these elements proves complex[46]. “Force” may sometimes be apparent to an outsider immediately, yet other times, it takes a highly experienced professional to recognize its nuances[47]. The TVPA also proves problematic as it excludes cases of sex trafficking for which the acts were deemed absent of force, fraud, or coercion[48]. In many cases, according to world renowned sex trafficking expert Siddarth Kara, people are judged to not be ‘severe’ victims of sex trafficking if they “originally agreed to work as prostitutes, albeit under false promises of rosy conditions that turned out to be slavery”, for example[49]

TVPA legislation similarly excludes illegal immigrants who fall victim to exploitation within U.S borders. Although implementation of T-visas to protect non-citizens arose through TVPA reauthorizations, in reality, many criticize the program’s protracted application process that leaves victims’ statuses unresolved. Furthermore, upwards of 50 percent of T-visa applications are denied because the individual is deemed to not be a victim of “severe” human trafficking[50]. Although programs exist to assist victims of sex trafficking, the reality of the law and its implementation does not live up to the law in its ideal sense.

Moreover, barriers to the criminalization of sex trafficking stem from the fact that state enforcement of human trafficking does not match federal TVPA laws, which results in many severe trafficking cases to be prosecuted as lesser crimes, like pandering, for example[51]. Additionally, some states entirely lack legislation which defines domestic trafficking as a crime[52]. In a report to the National Institute of Justice, Doctors Kevin Bales and Steven Lize discovered that state law enforcement agencies largely report having insufficient tools to attend to sex trafficking cases[53]. Moreover, even in states with explicit anti-trafficking legislation, interpretation and application of the laws have been excluded from police training[54]. The average officer remained unaware of their state’s anti trafficking laws in Dr. Bales’ and Dr. Lize’s extensive research[55]. There is much work to be done in the domestic context as those who even receive basic training still note that limited resources plague their agencies’ ability to investigate cases and identify victims[56].

Recommendations:

As author Dvora Yanow states in her novel How Does a Policy Mean?, “There is no single, correct solution to a policy problem any more than there is a single correct perception of what that problem is”[57]. I believe that Yanow’s words ring incredibly true in combating the sex trafficking industry in the United States. Based on my research, I believe that the best and most comprehensive way to rightfully criminalize and eventually eradicate the sex-trafficking industry is by developing a multi-faceted government/law enforcement and civilian approach.

First, I think that public awareness of the issue must increase exponentially in order to assist victims of sex trafficking. Yes, documentaries exist to educate the mass public, yet people often do not realize the extent to which the problem persists in their immediate community. Sex trafficking is undoubtedly “otherized” and carries connotations of being an international problem. This remains so far from the truth. As Kara states in his novel, Sex Trafficking: Inside the Business of Modern Slavery, “Approximately one-third of trafficking victims in the United States are discovered by individual citizens, not the police”[58]. That is why movements like CNN’s Freedom Project[59] and other public awareness campaigns are of the utmost importance because everyday citizens have the power to be vigilant and save potential victims in their own communities. Raising public awareness of the general public goes hand in hand with increasing training and awareness of law enforcement agencies and police departments towards this issue. In trainings, specifically for the police, I believe it is important to have highly skilled experts in the field of human trafficking to educate police teams as to the intersectionality of the problem. Often, the drug, sex, and weapons trade go hand in hand, thus, officers must be aware as to the nuances of the industry in order to best identify victims.

Second, I believe that U.S federal policy makers must address holes in implementing the TVPA, especially in regards to the effectiveness of issuing T-Visas to non-U.S citizens victimized by the sex trade. Oftentimes, victims cannot afford to wait months before they know they are safe within national borders; thus, T-Visa programs must expedite their process in order to issue the most effective help and assistance to non-U.S resident victims of forced sexual exploitation. For actors in the UN as well, although protocol to punish sex traffickers exists, it proves useless as I enumerated above unless nation states draft their own guidelines to prevent sex trafficking. Since sex trafficking plagues every nation, it must be combatted transnationally in order to best criminalize and abolish it. I strongly believe that sex trafficking must be treated as a human rights issue as opposed to an immigration one as the latter poses problems of stereotyping the trafficking industry and its victims.

Third, in order to get at the root of the problem, policies need to be in place to fund public programs which connect at-risk youth to helpful community services, rather than wait for them to matriculate into juvenile detention centers. Taking a proactive approach to engaging particularly at risk girls is incredibly important and has the ability to save countless lives from being trafficked. Service programs in public schools and in communities, with a focus on programming for girls, will hopefully prevent the typically marginalized and vulnerable individuals from entering into the sex trafficking industry.

Lastly, I think that the best way to criminalize sex trafficking within our borders is to make economic and prison penalties as steep as current drug offenses. Traffickers themselves cite that they often get involved in the sex trafficking trade because it carries less risk than the drug trade. Pressure must be placed on the domestic and global community to increase penalties for human slavery to at least equal to that of drug trafficking in order to deconstruct the current, pervasive low-risk perception that modern day slavery carries.


[1] “Sex Trafficking.” Polaris Project. October 26, 2017. https://polarisproject.org/human-trafficking/sex-trafficking.

[2] “United Nations Office on Drugs and Crime.” General Assembly President Calls for Redoubling of Efforts to End Human Trafficking. April 3, 2012.

[3] “What Is Modern Slavery?” U.S. Department of State. https://www.state.gov/j/tip/what/index.htm.

[4] Ibid.

[5] “Global Estimates of Modern Slavery: Forced Labour and Forced Marriage.” Report: Global Estimates of Modern Slavery: Forced Labour and Forced Marriage. September 19, 2017. http://www.ilo.org/global/publications/books/WCMS_575479/lang–en/index.htm.

[6] Ibid.

[7] Global Report on Trafficking in Persons: 2014. Vienna: United Nations Office on Drugs and Crime (UNODC), 2014.

[8] Ibid, 37

[9] Clawson, Heather J., Nicole M. Dutch, Amy Saloman, and Lisa Goldblatt Grace. “Study of HHS Programs Serving Human Trafficking Victims.” U.S. Department of Health and Human Services, Office of the Assistant Secretary for Planning and Evaluation, December 2009.

[10] Ibid.

[11] Estes, R., & Weiner, N. (2001). “The commercial sexual exploitation of children in the U.S., Canada, and Mexico”. Philadelphia: University of Pennsylvania.

[12] Territo, Leonard, and George Kirkham. International Sex Trafficking of Women & Children: Understanding the Global Epidemic. Flushing, NY: Looseleaf Law Publications, 2015.

[13] Dank, Meredith, Bilal Khan, P. Mitchell Downey, Cybele Kotonias, Debbie Mayer, Colleen Owens, Laura Pacifici, and Lilly Yu. “Estimating the Size and Structure of the Underground Commercial Sex Economy in Eight Major US Cities.” Urban Institute. March 11, 2014. https://www.urban.org/research/publication/estimating-size-and-structure-underground-commercial-sex-economy-eight-major-us-cities/view/full_report.

[14] Kara, Siddharth. Sex Trafficking: Inside the Business of Modern Slavery. New York: Columbia University Press, 2009, pg 12

[15] “More Assistance, More Action: 2016 Statistics from the National Human Trafficking Hotline and BeFree Textline.” Polaris. December 2016. Accessed December 16, 2017. https://polarisproject.org/resources/2016-hotline-statistics.

[16] “General Recommendations Made by the Committee on the Elimination of Discrimination against Women.” United Nations. Accessed December 16, 2017. http://www.un.org/womenwatch/daw/cedaw/recommendations/recomm.htm.

[17] “Sex Trafficking.” Polaris Project.

[18] Kara, pg 55

[19] ibid.

[20] ibid, pg 59

[21] Dank, Meredith et al, pg 2

[22] Bales, Kevin, Ph.D, and Steven Lize, Ph.D. Trafficking in Persons in the United States: A Report to the National Institute of Justice. Report. U.S. Department of Justice, 2005, pg 5

[23] Territo, pg 7

[24] Kara, pg 31

[25] Dank, Meredith et al, pg 8

[26] ibid

[27] ibid, 3

[28] ibid, pg 210

[29] Kara, pg 268

[30] ibid

[31] Dank, Meredith et al, pg 192

[32] ibid, pg 286

[33] ibid

[34] Peters, Alicia W. Responding to Human Trafficking: Sex, Gender, and Culture in the Law. University of Pennsylvania PR, 2015, pg 63

[35] ibid, 57

[36] ibid, 63

[37] ibid

[38] Bales, Kevin, Ph.D, and Steven Lize, pg 11

[39] Peters, pg 63

[40] “Current federal laws”. Polaris Project. https://polarisproject.org/current-federal-laws

[41] Kara, pg 258

[42] Peters, 49-50

[43] “United Nations Office on Drugs and Crime” United Nations Convention Against Transnational Organized Crime. https://www.unodc.org/unodc/en/organized-crime/intro/UNTOC.html.

[44] Kara, 255

[45] ibid.

[46] Peters, 80

[47] ibid, 78

[48] Kara, 70

[49] ibid, 255.

[50] ibid, 258

[51] Dank, Meredith et al, pg 8

[52] Clawson, Heather, pg 19

[53] Bales, Kevin and Steven Lize, 12.

[54] Clawson, Heather, pg 19

[55] Bales, Kevin and Steven Lize, 6.

[56] Clawson, Heather, pg 19

[57] Peters, 43

[58] Kara, 256

[59] “CNN Freedom Project.” CNN. March 31, 2015. http://www.cnn.com/specials/world/freedom-project.

 

Modern Challenges of Human Labor Trafficking: ​David v. Signal International

by MATTHEW BUCKWALD


As early as 2004, over 500 men from India were recruited by Signal International LLC, a
Gulf Coast marine services company, to work in their New Orleans site on the shore which was still recovering from massive loses during Hurricanes Katrina and Rita. Despite the tragedies of the storm and the dramatic employee drop at Signal, business was highly in demand because of storm-damaged rigs that desperately needed work. Recruiters representing Signal charged workers $10,000 to $20,000 per person for the “opportunity” to work at Signal; this “opportunity” included work, residence, registration with an H-2B “guest worker” visa, and the promise of an eventual employment-based permanent residence visa in the United States [1]. Promised a better life to eventually bring back to their families across the world, workers pulled money together by borrowing from families or villagers, selling land and jewelry, and borrowing from “loan sharks” at outrageously high interest rates. At the time these promises were made, there was a 5 year wait to get a green card for workers from India, which was obviously made unknown to the hopefuls.

As mandated by U.S. Citizenship and Immigration Services under the U.S. Department of
Homeland Security, H-2B “guest worker” visas may be owned for 10 months at a time, with the ability to renew such ownership only one, maybe two, times. A recipient’s guest worker visa is only valid if they are working for the sponsor employer. Contrary to Signal’s recruitment promise to the Indian men, H-2B visas expressly cannot be used as a path to permanent residency. In fact, immigrant intent is grounds for visa denial. Therefore, not only did the recruiters lie to the workers, but they also lied to the government. Later on the trial, Signal’s defense team would argue ignorance; they did not know about the promise of green cards. In essence, Signal’s counsel claimed that the plaintiffs were “self-trafficked.” Additionally, there are H-2B eligible countries, only from which immigrants may be considered for a guest work visa; India is still not among them [2].

Life at the Signal compound was humiliating and undignified. The contracts required the
workers to live in housing facilities that were built on the grounds, for which they were charged $1,065 per month to live there. Up to 24 men were assigned to live with each other in each small trailers and visitors were not allowed on the grounds. They were fenced, guarded, and constantly arbitrarily searched [1]. Essentially, they were forced into slave labor, with the threat of deportation always looming over their heads after it was revealed that they would not be receiving the promised path to citizenship nor an extension of their green card. Moreover, because of recruiting fees paid and debts incurred, the workers had to stay employed there, anyway. Culturally, the social stigmas around debt in India had a strong coercive impact. When the men borrowed money from “loan sharks,” little did they know of the constant threats and intimidations from across the world. Diaries and testimonies later exposed in discovery and in the trial would reveal that many of the workers were self-harming or suicidal.

As horrendous as living conditions were at Signal, the environment of the surrounding
area was similarly decimated by the hurricanes. Lawyers found voir dire to be particularly challenging because they were choosing from New Orleans natives who were already living in FEMA trailers due to their houses being destroyed during Katrina. Despite this, plaintiffs found clear intent and knowledge of living conditions at Signal on behalf of their recruiters and superiors. Litigants persuaded the judge to order Signal to turn over all search items, which included a diary from one of the Signal executives that noted intent for labor trafficking and enslavement. Many workers would escape the Signal compound and find refuge in over twelve big-name litigation firms across the country. Right in our backyard, some workers would stage a hunger protest on Embassy Row in Washington, DC.

After over 180 days of testimony and a year and half of trial, the jury found for the
plaintiffs on every single on of their claims against Signal on a false imprisonment charge, resulting in over $14 million in compensatory and punitive damages to the five Indian plaintiffs [3]. The case of David v. Signal highlights many of the modern challenges in international labor trafficking: environmental refugees, the power of international law, the effectiveness of monitoring human trafficking, and guest work visa disparities.

For one, Signal illustrates the realities of environmental refugees and how natural
disasters heavily impact human trafficking. The European Commission alleges that “The greatest single impact of climate change could be on human migration with millions of people displaced by shoreline erosion, coastal flooding, and agricultural disruption – a crisis in the making” [4]. When these millions are displaced domestically, however, large corporations are forced to turn to cheap labor, which often comes in the form of international labor trafficking, whether it is intentional or not.

In an international perspective, Signal violations of the United Nations’ “International
Convention on the Protection of the Rights of All Migrant Workers and Members of Their
Families” staggers up to over 14 violations of Articles and Sections [5]. There still exists the question, however, of if a worker’s citizenship status affects their eligibility to be protected in a particular country. Regardless, despite the United States having the largest percentage of migrant populations at 12.4%, they have still yet to ratify the Convention [6]. Of course, this calls into play the timely discussion of the relationship between International Law and United States Law. To what extent can we hold domestic enforcement agencies, namely the Department of Homeland Security, the Department of Justice, and the Department of State, accountable for international norms and regulations? The question remains wholly untouched, even with the augmented tensions in the Middle East regarding the Trump administration’s decision to move the United States embassy in Israel from Tel Aviv to Jerusalem.

Additionally, how did we not know about these violations? What went wrong in the job
supply chain that missed over 500 foreign nationals being trafficked? The tracking and
measurement systems in place are not doing enough to monitor large-scale human rights
violations. Polaris, one of the largest anti-human trafficking NGOs, reports that there is little or no data on the trafficker profile, recruitment methods, or victim profile of construction and non-agricultural trafficking incidents, such as the one with Signal [7]. If we drew parallels between technology and trafficking, then perhaps monitoring methods would have advanced far enough to impede Signal’s recruitment process.

Finally, there are a myriad of visas available to potential guest workers, but almost all are still controlled by the sponsor employer which complicates the ability to monitor and enforce human trafficking incidents. Domestic workers for foreign diplomats, royalty, or staff of international organizations may apply for an A-3 and G-5 visa, temporary business workers may apply for a B-1 visa, specialty occupations fall under H-1B, agricultural workers are eligible for H-2A, cultural exchange jobs can apply for J-I, and of course, non-agricultural workers may apply for H-2B visas. As much variety as there may seem at face value, only B-1 and some J-I visas have portability, or the ability to allow the worker in question to leave abusive jobs without losing their legal worker status in the United States [8]. Still, the overwhelming majority of guest workers do not have this choice.

The case of David v. Signal remains as one of the most gruesome public labor trafficking
cases in the United States. There is, however, substantial evidence to suggest that there are worse cases, domestically and internationally. Although Signal certainly sheds light on some of the most pressing issues in labor trafficking, there are more to be uncovered. This cases perfectly illustrates the potential for monstrous human rights abuses to take place closer to home than we ever thought, without penalty, without accountability, and without justice.

 


Notes
[1] Southern Poverty Law Center, “Federal jury in SPLC case awards $14 million to Indian guest workers victimized in labor trafficking schemed by Signal International and its agents”
[2] U.S. Citizen and Immigration Services, “H-2B Temporary Non-Agricultural Workers”
[3] American Civil Liberties Union, “David, et al. v. Signal International, LLC, et al.”
[4] European Commission, “COP21 UN Climate Change Conference, Paris,”
[5] United Nations, “Convention and Protocol Relating to the Status of Refugees”
[6] United Nations, “Convention on Migrants’ Rights”
[7] Polaris, “The Facts”
[8] Department of Homeland Security, “U.S. Citizen and Immigration Services”

 

Bodily Ownership in Medical Research: A Nuanced Perspective

By DOMINIC SOLARI

 


Much of modern law in American society is devoted to the protection of property, usually meant to include one’s possessions and one’s own person. However, counterintuitively, there have been court cases where one’s own body, organs, and cells were not considered to be one’s property. One such case is Moore v. Regents of University of California. In this case, the court found that an individual did not maintain a proprietary interest in his cells after they had been removed from his body for the ostensible purposes of medical testing and diagnosis. [1] While, at first blush, this ruling may appear irrational, philosophical underpinnings of our conception of property provided by John Locke support that Moore, the plaintiff, did not retain a proprietary interest over the cells removed from his body and that he was not entitled to the products made from them.

In the case, Moore voluntarily allowed samples of blood and other bodily substances to be removed from his body to help diagnose and treat his hairy-cell leukemia. These bodily substances were used for the stated purpose, but were then also used by researchers to study the cells of hairy-cell leukemia. Those researchers eventually created a cell line which generated a profit for one Dr. Golde (Moore’s physician) and for the Regents of the University of California. When Moore discovered this, he brought multiple suits against Golde, the UC Regents, and others including a suit of conversion, which protects against interference with someone’s property. Besides the issue of malpractice discussed in the case, the court grappled with Moore’s claim that he retained a proprietary interest over those cells which the medical staff used in their research and even over the products derived from studying them. Ultimately, and rightly, the court found that Moore did not retain a proprietary interest over his cells, and he was certainly not entitled to the products and profits of the researchers who used his cells. [2]

The philosopher John Locke’s Second Treatise of Government contributes to the understanding of why Moore did not retain a proprietary interest over the cell line and other products created by the researchers from his bodily samples. In his writing, Locke attempts to explain the origins of private property in a world with abundant natural resources given to humankind collectively. Locke believes that property is acquired through labor. Labor is done with one’s person, Locke argues, so that labor is an extension of one’s person and can turn public resources into private property. [3] As a result, his theory has been called the “labor theory” of property.

Locke’s explanation provides that the researchers’ actions of exerting labor on Moore’s cells, which were identical leukemia cells that could hypothetically have been found in any patient with the same disease, made those cells, or at least the products created from them, those researchers’ own property. Essentially, the scientists’ acts of studying and exerting labor on a natural resource (made more convincing by the point that the cells they were studying were non-unique to Moore and occur “naturally” in multiple people) created property through their labor that was theirs alone, not Moore’s.

In conclusion, there is great philosophical weight behind the court’s decision in Moore v. Regents of University of California. Specifically, Moore’s claim of proprietary interest over his cells and the products derived from them is not justified by the principles of bodily autonomy and property established by John Locke. While the malpractice of the doctor’s not informing Moore about the usage of his cells once removed from his body is an entirely different matter, as the court found, there seems to be no foundation, in either the philosophical world or the legal one, for Moore’s claim that the research and products from his cells were his property. This sets an interesting precedent in the ever-evolving world of genetic engineering and cell-line patenting. Once again, it seems medical research is pushing the boundaries of what we thought possible and our most basic questions of who we are.

 

Notes

[1] Moore v. Regents of University of California, No. S006987 (Supreme Court of Ca. Jun. 9, 1990).

[2] Id.

[3] John Locke, Second Treatise of Government,11, Ed. Jonathan Bennett (2017).

The Trials of Truancy on Pregnant and Parenting Teens

By KELSEY YUREK (COL’2019)


Teen pregnancy and birth rates have declined by one-half since the early 1990s, but the drop-out rates for young mothers are disproportionately high.[1] Teen childbearing continues to cost taxpayers billions of dollars on the local, state, and federal levels each year, and the welfare programs available for mothers necessitate adherence to strict rules regarding their educational and living arrangements to receive federal assistance.[2] TANF, Temporary Assistance for Needy Families, is one of these programs, and it was created in 1996.[3] A study by Janellen Duffy and Jodie Levin-Epstein (2002), Add It Up: Teen Parents and Welfare…Undercounted, Oversanctioned, Underserved, shows even teens who benefit from these programs fall into the categories of “undercounted, undertracked, oversanctioned, and underserved.” Simply put, their states and their schools are not doing enough to provide services to enable their continued education or even meet their daily needs. In fact, “at least eight states had difficulty narrowing down one top priority for services to help teen parents who have left school return” (Duffy & Levin-Epstein, 2002, p. 14). The services listed did not even identified childcare as a top issue. The following research provides an overview of relevant laws, the negative impact that pregnancy and parenting has on dropping out of high school, and the federal regulations associated with this issue.

Studies demonstrate that pregnant and parenting students possess decreased rates of educational success and drop out at a significantly higher rate. The Department of Education conducts a periodic High School & Beyond study which provides significant data on this topic.[4] The following three reports analyze this most recent national data and address students who are not pregnant or parenting, but only characteristics pertaining to pregnant and parenting students will be noted in this memo. Late High School Dropouts: Characteristics, Experiences, Changes Across Cohorts, published by Ben Dalton, Elizabeth Glennie, & Steven J. Ingels in 2009 highlights the high rate of girls who become pregnant and are forced to drop out of high school. [5] Olga Yakusheva finds that a strong negative correlation between immediate educational outcomes and early childbirth in her 2011 article In high school and pregnant: The importance of educational and fertility expectations for subsequent outcomes (p.822).[6] Finally, Phillip Kaufman, Marilyn McMillen & David Sweet examine students at-risk for dropping out in their report A Comparison of High School Dropout Rates from 1982 to 1992.[7] The group with “the greatest proportion of dropouts in 1990-92 had a child of their own living with them when they were in the 10th grade.”[8] While overall dropout rates have improved from the 1980s to the 1990s, the statistics for those at-risk categories, such as pregnant and parenting students have not improved.[9] They also note that the childcare burden disproportionately falls on females which increases their likelihood of dropping out.[10]

While truancy laws demonstrate a state interest in ensuring each citizen grows into productive a member of society by providing public education, they also pose a barrier to a new teen parent. Each state laws out their own truancy guidelines, which often recommend the proper steps to support students who violate truancy laws. The superintendent is heavily involved around all processes involving students and truancy.

With that, Title IX, which prohibits discrimination based on sex in places of employment or public accommodation, requires pregnant and parenting students have equal treatment within the educational system. The passage of this educational amendment in 1972 prohibited discrimination on the basis of pregnancy, childbirth, and parental status (Title IX, 1972). Prior to Congress passing Title IX, “students who became pregnant or had children were often treated poorly and sometimes were dismissed from high school” (“Supporting,” 2013, p. 4). According to the Department of Education, the following is true:

  • Encouraging pregnant and parenting students to stay in school will have a positive effect on their lives and their children’s lives.[11]
  • It is illegal for schools to exclude a pregnant student from participating in any part of an education program.[12] This includes anywhere from specific advanced placement classes to extracurricular activities.
  • The school must excuse absences and accommodate the pregnant student as long as the student’s doctor deems the absence medically necessary.[13]
  • If any special service is provided to students with temporary medical conditions, they must also be provided to students who are pregnant.[14] For example, if at-home tutoring is offered to another student as a medical accommodation then a pregnant student may also request it.

The class-action truancy case Boyer v. Bedrosian[15] parallels pregnant and parenting students’ situation where they are “not willfully” or “habitually” absent, but rather has a specific obstacle that keep them from attending school because of “special educational or medical needs or caretaking obligations at home.”[16] Almost all of the students in this case had special needs and benefitted from individualized education plans, known as IEPs. While a pregnant or parenting student has differing needs from those of the students in this case, caretaking responsibilities for a child indicates the potential benefit of instituting an IEP to accommodate their educational goals. As the school provides this service to students with medical conditions or special needs, they must also provide it to pregnant or parenting students

Any form of harassment of a pregnant student is a violation of Title IX. The Department of Education notes that harassment can take many forms.[17] A school district must also have a Title IX Coordinator to oversee these policies and any concerns regarding them. If a student feels that their rights have been violated under Title IX, they can file a complaint of discrimination with the Office of Civil Rights through an online form or a claim in court through their own attorney or the court’s clerk’s office.[18]

Overall, pregnant and parenting students should find support in their school to allow them to continue to pursue their academic goals. Title IX guarantees legal protections to these students, and a variety of resources are available at the local, state, and federal level. Although this group is at an increased risk of dropping out of high school compared to their peers, proper precautions should be taken to ensure they do not follow this path.

 


[1] The National Campaign to Prevent Teen and Unplanned Pregnancy. (2013, December). Counting It Up [The Public Costs of Teen Childbearing: Key Data].

[2] Duffy & Levin-Epstein, 2002, p. 1.

[3] Ibid.

[4] The data was originally published in a series of ongoing studies in 1982, 1992, and 2004. It was later analyzed in a report called Late High School Dropouts: Characteristics, Experiences, Changes Across Cohorts published by Ben Dalton, Elizabeth Glennie, and Steven J. Ingels in 2009. The same data is assessed by authors Olga Yakusheva and Phillip Kaufman, Marilyn McMillen & David Sweet in In high school and pregnant: The importance of educational and fertility expectations for subsequent outcomes and A Comparison of High School Dropout Rates from 1982 to 1992.

[5] Roughly one in three girls—28 percent of females to be exact—get pregnant while in high school and are forced to drop out as a result (Dalton, Glennie, Ingels, 2009, vii). The number of students dropping out has reduced from the 1980s to the 1990s, but these numbers demonstrate that the educational system continues to fail in supporting pregnant and parenting students

[6] Yakusheva states that “having a child or becoming pregnant is associated with a 5.9 percent higher probability of dropping out of high school and many mothers put off high school graduation.”

[7] Those considered “at-risk” fall into the following categories: “living in poverty, being of a minority group, being from an intact family, young people having children of their own” (p. v).

[8] Kaufman, P., McMillen, M., & Sweet, D. (October 1996). A Comparison of High School Dropout Rates from 1982 to 1992. National Center for Education Statistics,1-66. Retrieved October 30, 2017.

[9] Ibid.

[10] Male students drop out at only a rate of 6 percent compared to the females’ 28 percent (Kaufman, Marilyn, and Sweet, 2002). The burden is unfairly shifted on female students and necessitated intervention on the school’s behalf as “dropping out of high school is a major life event that severely impacts students’ chances for subsequent educational and occupational opportunities” (Dalton, Glennie, Ingels, 2009, iii).

[11] Supporting the Academic Success of Pregnant and Parenting Students. (2013). U.S. Department of Education,1-23. Retrieved October 30, 2017, p. 4.

[12] Ibid, 5.

[13] Ibid.

[14] Supporting the Academic Success of Pregnant and Parenting Students. (2013). U.S. Department of Education,1-23. Retrieved October 30, 2017, p. 6.

[15] Boyer v. Bedrosian (State of Rhode Island Superior Court 2010).

[16] Boyer v. Bedrosian was brought forth by several parents and legal guardians against the Rhode Island Truancy Court on behalf of their children who were summoned for absences. Boyer v. Bedrosian (2010) states that the Truancy Court was “initially designed with the stated purpose of providing at-risk students with quick and efficient access to services and support they needed to stay in school” (p. 3). The case highlights the issue that the Truancy Court targets students who have a specific obstacle preventing their attendance and penalizes them rather than offering services or support (Boyer v. Bedrosian, 2010, p. 3).

[17] Harassment includes verbal acts and name calling, graphic and written statements, and other conduct that may be humiliating or physically threatening or harmful (“Supporting,” 2013, p. 8).

[18] Supporting the Academic Success of Pregnant and Parenting Students. (2013). U.S. Department of Education,1-23. Retrieved October 30, 2017, p. 14.

Political Intrusion in the Judiciary: The Ninth Circuit vs. the President

Matt Schneider

The Constitution envisaged the judicial branch of the federal government as a nonpartisan arbiter of the legality of laws passed throughout the land, as a body that superseded the political winds of the time. However, with the advent of sharp political polarization in the last few decades, the judicial branch has often been dragged down through the partisan mud, with political actors seeing the court system more as a tool for their own policy goals. Under the current administration, the politicization of the judiciary has taken the form of an assault on the Ninth Circuit Court of Appeals.

On April 26th, the President told the Washington Examiner that his political opponents were using the court for “judge shopping” and that “what’s going on in the 9th Circuit is a shame” [1]. Additionally, a day earlier, the White House Chief of Staff Reince Priebus claimed that the court was “going bananas” [2]. Finally, Senator Ted Cruz has called the actions of the Court “lawless,” while also stating that the breakup of the court was “a possibility” [3, 4].

What events have led to such an all-out assault by the administration and its allies on a circuit court of appeals? Well, mainly, the court has served as the most significant impediment to the rollout of President Trump’s agenda in recent months. In particular, the court has blocked two of the President’s most controversial campaign promises: The court ruled as unconstitutional both the ban on travelers from the Middle East—seen by the Court as running “contrary to the fundamental structure of our constitutional democracy” in February—and the attempt to defund so-called “sanctuary cities,” by attaching immigration-related language to federal grants in April [5,6].

The court, which covers seven states in the West, Hawaii, Alaska, as well as Guam and the Northern Mariana Islands, handles over 12,000 cases at the appellate level each year [7,8]. The court has been seen by many in conservative circles as an example of judicial activism run amok and a way for left-leaning groups to win an appeal in a federal court [9]. Republicans have also pointed to the fact that the court has a 79% rate of its decisions being overturned at the Supreme Court as evidence of its straying from the laws of the land [10]. Additionally, other Republicans have argued that the court, which sees one-third of all federal appeals, is too crammed with litigation to rule effectively and efficiently [11,12].

Many of these arguments fall short when considered within context. First, there is no evidence that the Ninth Circuit has struggled to handle the amount of cases it is sent. Indeed, the Court has actually instituted several mechanisms by which to systematically screen cases for consideration and devote resources and judges to consider cases [13]. Second, the Supreme Court reverses the opinions of lower courts at a rate of 70%, which is not that much lower than the rate for the Ninth Circuit [14]. Finally, and perhaps most importantly to those crying for change in the Ninth Circuit fail to realize that breaking up the Court will probably not have much of an effect on the types of rulings passed down by the Ninth Circuit. The judges will still serve on the bench either in the Ninth Circuit or in another circuit court, and the current majority of judges appointed by Democratic presidents (18 of the 25 at the Ninth Circuit) will prevent any ideological shift [15,16]. Instead, any restructuring might lead to the production of two liberal courts instead of just one [17]. Given these circumstances, it seems that most of the ire with the court derives from its ability and willingness to challenge the policy priorities of the administration.

So, what legal means do the President and his allies in Congress have to redress some of their grievances with the Ninth Circuit? Certainly, an executive action signed unilaterally by the President will not suffice; indeed, Congressional approval of legislation aimed at restructuring the Ninth Circuit is needed for any such change to be implemented [18]. However, despite Republican majorities in both houses of Congress, conservatives will still need to face a Democratic caucus more than willing to use its filibuster to oppose such a partisan move. However, despite the odds against such an action, four Republican bills introduced to the House and Senate in recent months have been proposed, some of which seek to establish a 12th Circuit Court that that does not include California [19]. For real change to occur, the President would need to appoint more conservative judges, a possibility only if the Ninth Circuit is expanded to include more judges [20].

Even if the Republican White House and Congress could get past these obstacles, it would be unclear if the American people could support such a measure. History tells us no. Such a blatant attempt to change the judicial landscape to better favor a President’s partisan ends would incur rabid opposition from the public, as it has in the past. The most memorable example of such judge cherry-picking was President Franklin Delano Roosevelt’s court-packing plan in 1937, in which he sought to reshape the Supreme Court so that he could appoint more judges sympathetic to his New Deal legislation. That endeavor failed because of the obviousness of its partisan nature, and it would not be surprising if any attempt to change the Ninth Circuit Court would fail for the same reason.

 

Works Cited

[1] Westwood, Sarah. “Exclusive Interview: Trump ‘Absolutely’ Looking at Breaking up 9th Circuit.” Washington Examiner. N.p., 26 Apr. 2017. Web. 30 Apr. 2017. <http://www.washingtonexaminer.com/trump-absolutely-looking-at-breaking-up-9th-circuit-court-of-appeals/article/2621379&gt;.

[2] Fabian, Jordan. “Priebus Calls 9th Circuit ‘Bananas,’ Says Administration Will Prevail on Sanctuary Cities.” The Hill. N.p., 26 Apr. 2017. Web. 30 Apr. 2017. <http://thehill.com/homenews/administration/330572-priebus-calls-ninth-circuit-bananas-warns-admin-will-prevail-on&gt;.

[3] “Cruz: Court’s Travel Ban Decision Lawless.” CNN. Cable News Network, 23 Feb. 2017. Web. 30 Apr. 2017. <http://www.cnn.com/videos/politics/2017/02/23/ted-cruz-cpac-judicial-activism-immigration.cnn&gt;.

[4] Hensch, Mark. “Cruz: Breaking up 9th Circuit Court ‘a Possibility’.” The Hill. N.p., 27 Apr. 2017. Web. 30 Apr. 2017. <http://thehill.com/homenews/senate/330935-cruz-breaking-9th-circuit-court-a-possibility&gt;.

[5] Zapotosky, Matt. “Federal Appeals Court Rules 3 to 0 against Trump on Travel Ban.” The Washington Post. WP Company, 09 Feb. 2017. Web. 30 Apr. 2017. <https://www.washingtonpost.com/world/national-security/federal-appeals-court-maintains-suspension-of-trumps-immigration-order/2017/02/09/e8526e70-ed47-11e6-9662-6eedf1627882_story.html?utm_term=.dd6cd0fd61f6&gt;.

[6] Phillips, Amber. “California Is in a War with Trump on ‘Sanctuary Cities.’ It Just Won Its First Major Battle.” The Washington Post. WP Company, 25 Apr. 2017. Web. 30 Apr. 2017. <https://www.washingtonpost.com/news/the-fix/wp/2017/04/25/california-is-in-a-war-with-trump-on-sanctuary-cities-and-it-just-won-its-first-major-battle/?utm_term=.e3116cc7da4b&gt;.

[7] “What Is the Ninth Circuit?” Ninth Circuit Court of Appeals. Web. 30 Apr. 2017. <https://www.ca9.uscourts.gov/judicial_council/what_is_the_ninth_circuit.php&gt;.

[8] Feuer, Ben. “The Republican Case for Breaking up the Notoriously Liberal 9th Circuit Makes No Sense.” Los Angeles Times. Los Angeles Times, 19 Mar. 2017. Web. 30 Apr. 2017. <http://www.latimes.com/opinion/op-ed/la-oe-feuer-9th-circuit-20170319-story.html&gt;.

[9] Hensch, Mark. “Cruz: Breaking up 9th Circuit Court ‘a Possibility’.”

[10] Feuer, Ben. “The Republican Case for Breaking up the Notoriously Liberal 9th Circuit Makes No Sense.”

[11] Wheeler, Lydia. “Trump’s Hands Are Tied on 9th Circuit.” The Hill. N.p., 28 Apr. 2017. Web. 30 Apr. 2017. <http://thehill.com/homenews/administration/331108-trumps-hands-are-tied-on-9th-circuit&gt;.

[12] Phillips, Amber. “Can Trump ‘absolutely’ Break up a Federal Court That’s Standing in His Way?” The Washington Post. WP Company, 28 Apr. 2017. Web. 30 Apr. 2017. <https://www.washingtonpost.com/news/the-fix/wp/2017/04/28/can-trump-absolutely-break-up-a-federal-court-thats-standing-in-his-way/?utm_term=.4f82c8fa53ad&gt;.

[13] Feuer, Ben. “The Republican Case for Breaking up the Notoriously Liberal 9th Circuit Makes No Sense.”

[14] Ibid.

[15] Ibid.

[16] Westwood, Sarah. “Exclusive Interview: Trump ‘Absolutely’ Looking at Breaking up 9th Circuit.”

[17] Wheeler, Lydia. “Trump’s Hands Are Tied on 9th Circuit.”

[18] Phillips, Amber. “Can Trump ‘absolutely’ Break up a Federal Court That’s Standing in His Way?”

[19] Ibid.

[20] Phillips, Amber. “Can Trump ‘absolutely’ Break up a Federal Court That’s Standing in His Way?”

 

Failures of the Financial CHOICE Act of 2016

Jee Young Kim 

Introduced in September 2016 by House Financial Services Committee Chair Rep. Jeb Hensarling (R-TX5), the Financial CHOICE Act, H.R. 5983 (FCA), seeks to deregulate the country’s financial sector. It is seen as the Republican response to the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank). Signed in 2010, Dodd-Frank introduced new regulations in order to prevent another financial crisis. Among other provisions, Dodd-Frank created the Consumer Financial Protection Bureau (CFPB) as well as the Financial Stability Oversight Council (FSOC). The primary role of the CFPB is to create and enforce consumer financial regulations on both banks and non-bank institutions. It seeks to increase transparency and fairness for financial products and services, with emphasis on protecting consumers.[1] The FSOC identifies the economy’s level of financial risk and has the ability to oversee individual institutions that may be engaging in excessively risky behavior.[2] Through the establishment of such agencies, along with other regulations – such as increased required reserves for banks – Dodd-Frank has prevented financial institutions from enjoying the same level of freedom they had before the 2007/8 financial crisis.

The FCA – which currently remains as a bill – proposes to amend several provisions of Dodd-Frank. For example, it seeks to repeal the “Volcker Rule,” which prohibits banks from proprietary trading with risky assets and from sustaining certain relationships with investment funds, such as hedge funds or private equity funds.[3] In this way, the FCA aims to eliminate the safeguards against the risky behavior that contributed to the financial crisis. The Volcker Rule is only one of many Dodd-Frank regulations that the FCA is targeting.[4]

Many supporters of the bill argue that the FCA will correct Dodd-Frank, which they see as excessively restrictive on the financial sector. According to the House Financial Services Committee, Dodd-Frank “directs federal regulators to burden job creators and the economy with more than 400 new rules and mandates.”[5] Supporters also point out that the Congressional Budget Office estimates Dodd-Frank to take $27 million from the economy.[6]

The FCA, however, should not be passed. One major reason is that it helps to create a dangerously speculative financial environment. As mentioned above, Dodd-Frank created the CFPB, which is a necessary agency that protects the general public. Although it has been subject to some controversy because of its relative independence from the congressional appropriations process (it gets much of its funding from the Federal Reserve’s revenues), this financial autonomy most likely is helpful rather than harmful for consumers. Instead of worrying about politics in Congress and appeasing the lawmakers that could potentially control its budget, size and even its mission, the CFPB can more effectively focus on its main objective, which is to make sure U.S. consumers are not taken advantage of. Opponents argue that the transparency of the CPFB is an issue given the nature of its funding. It is important to note, however, that measures that ensure the agency’s transparency and accountability do exist. The CFPB director’s biannual testimony before Congress and the cap on the CFPB’s non-appropriated funding are some examples. The FCA nonetheless aims to restrict the authority of the CFPB. For one, it wants to subject the agency to the traditional appropriations process. It also seeks to repeal the agency’s power to declare certain abusive acts as unlawful and proposes to increase the threshold for depositories that come under the CFPB’s supervision from $10 billion to $50 billion.[7] Curtailing the influence of the CFPB could lead to dangerous outcomes. The general public will receive less protection, and financial institutions will have less resistance when engaging in the types of behavior that we all saw could lead to disastrous economic outcomes on a global scale. The agency has already returned almost $12 billion of relief to 29 million consumers.[8] It has also played an integral role in holding Wells Fargo accountable for its illegal practice of opening unauthorized accounts.[9] The CFPB is an important agency that has so far shown that it can do much good for consumers. Therefore, limiting its authority is not a wise move to make.

The House Financial Services Committee criticizes Dodd-Frank by saying that it “reaches far beyond Wall Street and does not address the real causes of the crisis [and] continues the bailouts by enshrining “too big to fail” into law, placing taxpayers at risk for trillions of dollars of future bailouts.”[10] The House Financial Services Committee argues the FCA is needed because Dodd-Frank does not resolve the real issues of the economy. However, what exactly does the FCA plan to do with these problems? Its solution to taxpayer-funded bailouts is to prevent the FSOC from designating certain institutions as “too big to fail.” This designation is what places such institutions under additional regulations. Simply prohibiting the designation does not automatically lead to the end of government bailouts. Such public expenditure may nonetheless be necessary if an institution’s bankruptcy puts the health of the economy at risk. By placing such institutions under more stringent regulations, however, FSOC acts preemptively to decrease the chances of those bankruptcies. But the FCA instead plans to remove such designations. Such a change will only allow these institutions to more easily engage in risky behavior, which makes bankruptcies and the consequent bailouts all the more likely. Supporters of the FCA base their arguments on the need to address the real issues. Yet, their proposed resolution is not the answer to those problems.

Dodd-Frank is not perfect, but the FCA is not the solution. Despite the bill’s shortcomings, Jeb Hensarling has announced that a new version is scheduled to be released soon.[11] Considering the Republican-led Congress as well as Trump’s presidency, the passage of some version of the bill seems highly likely.

 

[1] “Consumer Financial Protection Bureau” Federal Register. https://www.federalregister.gov/agencies/consumer-financial-protection-bureau.

[2] “H.R. 5983 (114th): Financial CHOICE Act of 2016” govtrack. https://www.govtrack.us/congress/bills/114/hr5983/summary#oursummary.

[3] “The Financial CHOICE Act: Policy Issues” Congressional Research Service. https://fas.org/sgp/crs/misc/R44631.pdf.

[4] “H.R.5983 – Financial CHOICE Act of 2016” Congress.gov. https://www.congress.gov/bill/114th-congress/house-bill/5983.

[5] “Oversight of Dodd-Frank Act Implementation” Financial Services Committee. http://financialservices.house.gov/dodd-frank/.

[6] “H.R. 5983 (114th): Financial CHOICE Act of 2016” govtrack. https://www.govtrack.us/congress/bills/114/hr5983/summary#oursummary.

[7] “The Financial CHOICE Act: Policy Issues” Congressional Research Service. https://fas.org/sgp/crs/misc/R44631.pdf.

[8] “Consumer Financial Protection Bureau: By the numbers” Consumer Financial Protection Bureau. https://files.consumerfinance.gov/f/documents/201701_cfpb_CFPB-By-the-Numbers-Factsheet.pdf.

[9] “Consumer Financial Protection Bureau Fines Wells Fargo $100 Million for Widespread Illegal Practice of Secretly Opening Unauthorized Accounts” Consumer Financial Protection Bureau. https://www.consumerfinance.gov/about-us/newsroom/consumer-financial-protection-bureau-fines-wells-fargo-100-million-widespread-illegal-practice-secretly-opening-unauthorized-accounts/.

[10] “Oversight of Dodd-Frank Act Implementation” Financial Services Committee. http://financialservices.house.gov/dodd-frank/.

[11] “Revised Financial CHOICE Act to Come Soon” DSnews. http://www.dsnews.com/daily-dose/03-23-2017/revised-financial-choice-act-come-soon.

Conflict of Interest Laws: Business Ties Under the New Administration

Ava Kazerouni SFS 2019

Upon confirmation of his winning the election, questions have arisen regarding Trump’s relations to his businesses and how it will affect his role as president. In the past, most presidents were career politicians, thus the matter of maintaining business ties have been of little importance. Presidents who did have businesses in the past, such as Carter and George W. Bush, made sure to separate themselves from those businesses upon election [1].

Trump, however is much more heavily invested in these businesses, as they are the basis of his career. Though it would seem likely that there would be laws regulating government officials, especially the president, from maintaining business ties once acting as commander in chief, there is actually little regulation in this regard [2]. There are regulations for the legislative and judicial branches, however, laws regarding the president are much more vague and are not as fully developed [3].

Though he has handed the reigns of the Trump Organization to his children, he is still able to exert influence over the organization, and he has given those same children considerable influence in the White House. However, because most of the organization is dealing with domestic business, there is no regulation written in law to prohibit Trump from having ties to it [4]. The absence of these regulatory laws could be because Trump’s business experience is unprecedented for a United States president, but the oversight might be reconsidered in the changing political climate and the recent election. A president being able to exert influence over personal business matters can become dangerous, as it will undoubtedly influence political and economic decisions.

The only possible legal prohibition regarding Trump’s businesses would be due to his foreign investments. Section One, Article Nine in the Constitution, called the Emoluments Clause, has received attention recently by groups hoping to prevent Trump from maintaining his business connections during his presidency [5]. The clause states, “no Title of Nobility shall be granted by the United States: And no Person holding any Office of Profit or Trust under them, shall, without the Consent of the Congress, accept of any present, Emolument, Office, or Title, of any kind whatever, from any King, Prince, or foreign State.” Thus presidents are not permitted to receive any foreign gifts [6].

The group that is suing Trump is claiming that these “gifts” can be interpreted as a payment for an exchange of services, and not just actual presents from a foreign government [7]. If the court system agrees with them, it will restrict Trump’s many businesses from providing services to foreign governments, something that it has done repeatedly. Trump’s lawyers are claiming that on the contrary, a gift is different from a payment for a service provided by Trump’s company, and Trump himself has denied any illegal actions by his company [8].

Whether this lawsuit will win or not is yet to be determined, however, it is clear that the nation is entering a new political climate. Due to this unprecedented election, the nation is attempting to reconcile its thoughts on a president with such a different background than what has come to be expected since the founding of the country. This attempt is manifesting itself in a push for increased regulation on an executive who seems determined to increase his own powers.

[1] Julie Bykowicz, “Why Conflict of Interest Laws Apply Differently to the President,” PBS News Hour (November 30, 2016), http://www.pbs.org/newshour/rundown/conflict-interest-rules-apply-differently-president/

[2] Bykowicz

[3] Bykowicz

[4] British Broadcasting Company, “Donald Trump: A List of Potential Conflicts of Interest,” (January 10, 2017). http://www.bbc.com/news/world-us-canada-38069298

[5] James Dennin, “One Clause in the US Constitution Could Put Trump’s Foreign Business Connections in Jeopardy,” Business Insider (November 22, 2016). http://www.businessinsider.com/donald-trump-business-connections-us-constitution-2016-11

[6] Fahrenthold, David and Jonathan O’Connell, “What is the ‘Emoluments Clause’? Does it Apply to President Trump?” The Washington Post (January 23, 2017).

[7] Fahrenthold, David and Jonathan O’Connell

[8] Fahrenthold, David and Jonathan O’Connell

The practice of appointing any attorney at the state bar as a public defender

Rachel Linton SFS 2019

The Bill of Rights gives every American accused of a crime “the right to an attorney.” What that means today, as a result of 1963 Supreme Court decision Gideon v. Wainwright, is that anyone accused of a crime who cannot afford an attorney can have one appointed to them by the court.

In many jurisdictions, however, that “can” is called into question—because there are simply too many cases and not enough attorneys. As far back as 2007, 73% of county public defenders offices exceeded the maximum recommended number of cases. In 2013, then-Attorney General Eric Holder admitted that the public defense system was in “a state of crisis.”[1]

What does this mean for the accused?

In New Orleans, that means that when a case is called, a lawyer from the public defender’s office simply reports, “Your honor, we do not have a lawyer for this person at this time.” Last January, the New Orleans Public Defender’s office had such a large backlog that they stopped taking cases.[2]

This left many poor individuals without attorneys, a situation for which the state of Louisiana does have a solution. Unfortunately, this solution can cause as many problems as it solves. Any attorney at the state bar in Louisiana can be assigned a pro bono case of public defense. This can occur regardless of whether they’re still a practicing attorney—or whether they’ve ever practiced criminal law. In one case covered by NPR’s This American Life, an accident and injury lawyer who hadn’t practiced criminal law in thirty years was assigned a criminal case.[3]

Louisiana is far from the only state struggling to meet the demands for public defense. In 2014, a study determined that Missouri needed an additional 270 public defenders to adequately serve the needs of the population. By late 2016, every public defender in Missouri had more than a hundred cases at any time—and sometimes more than 200. In August of 2016, public defender Michael Barrett raised the profile of the issue by attempting to assign a case to Missouri Governor Jay Nixon. Nixon had previously vetoed caseload caps and blocked funding for public defense.[4]

By September of last year, the American Civil Liberties Union (ACLU) had filed lawsuits in Louisiana, Michigan, California, Washington, and Montana alleging that the poor were being offered inadequate legal defense.[5] With attorneys in Washington state spending less than an hour per case due to their workload, “inadequate” seems to be entirely too mild a term.1

Professor Ellen Yaroshefsky said the New Orleans criminal justice system was a “processing system” rather than a “justice system” as a result of the public defense crisis2—and New Orleans is far from alone. Without dramatic overhauls, “criminal justice” will remain a misnomer in many states—especially for the poor.

[1] Van Brunt, Alexa. “Poor people rely on public defenders who are too overworked to defend them.” The Guardian, 17 June 2015.

[2] Bunton, Derwyn. “When the Public Defender Says, ‘I Can’t Help’.” New York Times, 19 Feb. 2016.

[3] Zax, David. “This American Life.” 595: Deep End of the Pool. If You Cannot Afford an Attorney, Some Random Dude Will Be Appointed to You. 26 Aug. 2016. Web.   8 March 2017.

[4] Domonoske, Camila. “Overworked And Underfunded, Mo. Public Defender Office Assigns Case — To The Governor.” NPR, 4 Aug. 2016.

[5] Greenblatt, Alan. “Overworked and Underfunded, Public Defenders See Some Light.” Governing, 20 Sep. 2016.