Sex, Economics, and Other Legal Matters

Judge and scholar Richard A. Posner speaks out on the Clinton impeachment, the Microsoft case, and nude dancing.

Richard A. Posner might be the most important and influential legal thinker alive. A professor at the University of Chicago Law School since 1969 and a judge on the U.S. Court of Appeals for the 7th Circuit since 1981, he is the author or co-author of more than two dozen books, including Economic Analysis of Law (1973), which helped pioneer the thriving field of law and economics. He has also written hundreds of articles and book reviews, as well as some 1,800 judicial opinions. While economics informs his thinking, Posner is hardly a one-trick pony: He has addressed topics as diverse as cloning, rhetoric, Kafka, citation style, AIDS, euthanasia, literary theory, advertising, and ancient Greece; it's almost easier to list subjects he hasn't discussed.

As widely esteemed as Posner is, he has also been widely attacked. Conservatives have questioned what they see as his moral relativism, as well as his skepticism that simple deductive legal analysis can lead to the "right" judicial ruling. The left objects to his attack on moral philosophy and his claim that there has been too much emphasis in the law on free-floating standards such as "fairness" and "social justice." And many on all sides have been troubled by his seemingly cold-blooded economic approach to human interaction, including examinations of rape, abortion, and the selling of babies.

While Posner had been a well-known and controversial figure in legal circles for three decades, in 1999 his notoriety spread further: He published a book about the Clinton impeachment, An Affair of State, that caused a stir, and he was named mediator in the Microsoft antitrust case (although the negotiations ultimately fell apart). Suddenly he was an A-list legal celebrity, profiled in newspapers and magazines across the nation.

I got to know Posner while attending the University of Chicago Law School, where I took his classes on the legislative process and law and literature. Whenever I'm passing through town, we meet for lunch. Considering how strongly worded his opinions can be, in person he is surprisingly soft-spoken, with a gentle good humor. His conversation, as might be expected, is wide-ranging: He may talk about the limits of federal jurisdiction at one moment and his love of the little-seen comedy 8 Heads in a Duffel Bag the next. And as busy as he must be, he is a host who never gives you the feeling that he's in a rush.

Oscar Wilde once said of George Bernard Shaw that "he hasn't an enemy in the world, and none of his friends like him." Posner is the opposite: Plenty of people strongly disagree with his writings, but he's such a genial, hardworking person that even his enemies can't help but admire him.

Reason: You came to the University of Chicago in the late 1960s. What were the turning points, occurring around that time, that shaped the emerging field of law and economics?

Richard A. Posner: I think the basic developments were earlier. They really go back to the '50s. As sophisticated economics became trained on antitrust issues, and as antitrust became an important field of law, lawyers began to notice that there was a body of economic work that had a lot to do with law. But the impact was mainly in the antitrust field and closely related fields like public utility and common-carrier regulation. Then Ronald Coase published his article on social cost in 1960, and about the same time Guido Calabresi published his first article on tort law. These were two articles applying economics to the common law as far as it had been to the antitrust domain. Now people began to realize that economics might have a broader scope. When I started teaching in 1968, I had actually been working on antitrust cases; I was an economics fan. I discovered there was this economics of tort law as well, and it began to seem that economics had a broad applicability to law.

Another thing that is important here is the general deregulation movement, which made microeconomics seem more important to public policy because of the criticisms of the regulatory schemes: regulation of airlines and other forms of transportation, financial institutions, communications, and so on. Criticisms were pitched on microeconomic grounds, so people became more familiar with concepts of marginal cost, monopoly, barriers to entry, and so on. So the antitrust economics, the expansion of economic thinking into other areas of law, and the deregulation movement made lawyers very sensitive to economic criticisms of law.

Reason: You were born in 1939 in New York City. Your father was a lawyer and your mother, you've said, was fairly left-wing.

Posner: Yeah, she was a public school teacher. She was very left-wing.

Reason: And you knew the Rosenberg kids when you were growing up.

Posner: Only slightly. But shortly after their parents were executed, their adoptive parents, whom my parents knew, brought these kids to my house. I don't know quite how the idea originated, but my mother asked me whether it would be all right to give these unfortunate children my electric train. And I said fine, because I had outgrown electric trains. I was already 13 or 14. I mention this because there was once an article about me—this is really weird—claiming that the reason I became conservative was a deep resentment that my mother had taken my electric trains and given them to these spies' children. (Laughter.)

Reason: When you came to Chicago, I suppose you had already known or heard of people like Ronald Coase, Milton Friedman, Gary Becker, and Aaron Director.

Posner: Aaron Director had retired. He was living near Stanford and had an office in the Stanford Law School. I recognized the name when I started teaching at Stanford in 1968, and I went into his office and introduced myself. I became very friendly with him. Then in that spring quarter, George Stigler visited Stanford, and through Aaron I became very friendly with George. Through Aaron Director I was put on a task force on antitrust policy for the president-elect, the infamous Nixon. The task force was headed by George Stigler, and Ronald Coase was one of the members. I met Milton shortly afterwards. That year I learned about the Chicago approach to antitrust.

Reason: In The Economics of Justice (1981), you described the common law as a tool to maximize aggregate social wealth. You said that is what judges sought to do through their decisions. Was this an original insight, and what attacks were made against it at the time?

Posner: It was pretty original. There are hints of it in Ronald Coase's article on social cost. He wasn't too clear about it, but the implication that I drew was that he thought the English judges had been trying to make an economically sensible law of nuisance. And Harold Demsetz, one of the Chicago economists now at UCLA, wrote something which hinted at this.

The idea was criticized on two basic grounds. One, that it doesn't fit the facts. There are too many anomalies, too many rules, too many outcomes in common law cases that can't be explained as efficiency-promoting. That is one criticism, and obviously there is some merit to it. Another criticism objects to the notion that judges would be concerned with economic efficiency rather than with more distinctively legal or moral concepts such as fairness. That sticks in the craw of many lawyers. By now, I think everyone agrees there is strong economic content in the common law, and the law generally, although how important it is can be questioned.

Reason: In Economic Analysis of Law [1973], you made large claims for economic analysis, not just regarding contracts or antitrust cases but also in criminal law, family law, racial discrimination, and federalism.

Posner: Yes, that's correct. Oddly, the area where the most resistance has been encountered is the criminal law. There is a really interesting body of economic writing about criminal law, about both deterrence and punishments—the whole punishment structure. Also, about the doctrines of attempt and conspiracy. I think this is very interesting stuff that has made no real impression in the teaching of law. There was an economist in the United States Sentencing Commission, and there is definitely an economic flavor in the federal sentencing guidelines. But apart from that, the criminal bar and professoriate have not been receptive.

Feminists, in recent years, have picked up the law and economics ball and have run with it. It's a very interesting inversion of conventional positions, but a number of radical feminists now are strongly advocating the commodification of family relations. What they say is we want to commodify, to put a pecuniary value on, the work that women do outside the markets, because if it's not commodified, not monetized, it's not recognized in our society as productive work.

Reason: While you were attacked from the start for applying economics to all sorts of law, as a judge you have been attacked from the other side for not consistently using economics in your decisions. What do you think about that criticism?

Posner: There are two aspects of that. First, there are simply many legal issues to which economics doesn't speak. When you are talking about the teaching of law or scholarly writing about law, the focus tends to be on the big questions and large principles that inform a field of law. There, I think the economic approach is very fruitful. But in the actual day-to-day litigation process, many of the cases involve issues that are of a purely interpretive, purely factual character, dealing with the details of comprehensive statutes, and they just don't lend themselves to economic analysis. Many other cases do. I have written many tort, contract, antitrust, and labor cases where I thought an economic angle was valuable. But we're talking about 1,800 judicial opinions.

The second point is that the experience of being a judge is bound to moderate one's views. When you are dealing with large doctrinal policy issues in a rather abstract way, it's very easy to allow your general outlook on things to carry you to foreordained conclusions. But when you are actually forced to consider both sides of the case, often you realize there is more to be said on the other side of the case than you might have thought. So a lot of statutes that I would have ridiculed as preposterous interventionism in the economy, when looked at up close in the context of the specific case, make more sense. I have learned there is more to be said for some of these interventionist laws than I had initially thought.

Reason: You have described yourself as a pragmatist, and you've been described by others as an eclectic libertarian. Do you see yourself as a libertarian? I know you are a follower of John Stuart Mill in some ways.

Posner: Yes, I regard myself as a libertarian, in a sense that has virtually disappeared from the American public scene. It is basically the Millian sense, but without buying into all of Mill's views. Apart from the fact that he was writing almost 150 years ago, his thought isn't entirely consistent. He had a lot of specific views that seem very strange to me. But I think of myself as someone who believes that the government should intervene only where private activity is palpably harmful or where there are external benefits. For example, an educated population benefits the society as a whole. You benefit from the fact that other people are educated, just as you benefit from the fact that other people subscribe to the telephone service. Where there are external benefits, there is a case for government intervention.

The reason libertarianism doesn't have much support anymore in the U.S. is that liberals, as they describe themselves today, believe in freedom of personal behavior—sexual behavior and so on—but want to regulate markets, whereas the conservatives want markets to be free but seek to regulate people's personal behavior. The libertarian doesn't like either form of regulation, unless it meets pretty tight criteria: The target of government intervention has to be an activity that either imposes external costs or creates external benefits. That position, I think, has very little appeal.

Reason: Most legal pragmatists—people like Richard Rorty—are from the left. Yet you describe yourself as a pragmatist, and your views are generally considered right-wing.

Posner: There is a historical, accidental connection between pragmatism and leftism, personified by John Dewey. For Dewey the enemy was religion. He thought religion, and forms of scientific thought that are successors to religion and promise ultimate truth, interfered with social progress, because he associated social progress with experimentation. Experimentation implies that you don't know the answer; that is why you have the experiment. So Dewey and successors like Dick Rorty are fighting against a kind of Platonic heritage, the notion that there are ultimate truths that are knowable, and once we know them we have no reason to listen to other people. That perspective is very different from the sense that everything is in flux, implying experimentation.

The other association of pragmatism with the left is that philosophical pragmatism, with its skepticism about truth claims, has an uncomfortable resemblance to the thought of the postmodernists, who are invariably politically radical. People like Michel Foucault or Jacques Derrida seem to want to challenge all kinds of structure and thought in society, and that seems radical and destabilizing. People who are drawn to that kind of intellectual anarchism, or who think that the important thing is knocking religion off its pedestal, are going to be left-wing.

My sense of pragmatism is not philosophical pragmatism but the ordinary-language meaning of the term. When people say Americans are pragmatists, they don't mean they are postmodernists with strong philosophical views about the correspondence theory of truth. They mean they are not interested in large theoretical questions; they are interested in practical solutions to current problems. That is the lay sense of pragmatism and also my sense. I don't want to get tangled in metaphysical questions. I didn't always feel this way, but today I don't want to argue that efficiency is the most important thing in the world and aggregate wealth is the only thing society should care about. I can defend an emphasis on efficiency in the law on practical grounds, which will create results most people like, but I'm not prepared to erect a metaphysics of efficiency that will prove that's the only thing we should be worrying about.

Reason: You've complained that academics and judges don't know enough about the outside world.

Posner: The outside world is not the world of philosophical speculation. It's the world of fact. The philosophical pragmatists—people like Rorty or Stanley Fish or some of the "crits" who considered themselves to be postmodernists—they don't have much interest in how things actually work. There is a texture of social and economic life. It's that level of factuality that I think is important and that lawyers and judges are deficient in.

Reason: Does this have anything to do with your new book, Public Intellectuals?

Posner: It has a little bit to do with it. I guess the worst form of public intellectual activity is where the intellectual is speculating in a factual void—maybe because he is dealing with a field that is completely unrelated to his academic work. For example, in the Times last Sunday there was a funny article about Elaine Scarry, the English professor at Harvard, who writes about plane crashes. She has this notion of a kind of electromagnetic Bermuda Triangle in the North Atlantic that keeps knocking planes off. She actually did research, and it wasn't completely ridiculous. The Times pointed out that the experts had read her stuff and didn't consider it completely crazy, but they didn't agree with it. When you write outside your field—although I should not really throw that particular stone—there is the temptation to write about things without the kind of factual immersion that would be necessary for responsible engagement with the issue.

In my book I make fun of Lester Thurow, an economist at MIT, who says that in the year 3000 economists will look back to our day and say this was the Age of America. Three years ago, he thought it was the Age of Japan. So he is reckless in predicting the future.

I have added to my book a few pages on the ads of the Emergency Committee of Concerned Citizens about the election. On the op-ed page of The Wall Street Journal today, there is a humorous article about the academics and the celebrities who sign these petitions. I think the ad first appeared three days after the election. It must have been done within 24 hours. It's a goofy document that asks for a revote, and University of Chicago law professor Cass Sunstein, who signed it quickly, later back-pedaled. It's quite amusing. So when academics talk outside their field, or they make predictions, or they try to respond to something current on a journalistic time scale, they can get into trouble.

Reason: In your book on the Clinton impeachment, you criticize almost everyone except for the media.

Posner: The media at first were fiercely criticized for giving currency to unfounded rumors, of which the most dramatic was the dress. But in retrospect, it did not appear that they made serious errors or displayed prejudice. I thought they did pretty well.

Reason: But everyone else messed up. What should have happened? Should the Supreme Court have allowed the case? Should Clinton have admitted the truth?

Posner: I do think the Supreme Court should not have permitted the Jones case to go forward during his term of office. I think that would have been a hard opinion to write, but they should have realized that to allow the president to be hauled into court for a sex case would be very disruptive of the government and would really exacerbate partisan passions. They could easily have told Paula Jones to wait two years. Then the case would have been settled, as it was eventually. It was a serious mistake of the Supreme Court. There were, of course, many political blunders committed by both sides. I thought the intellectuals came off as hysterical and uninformed. It was quite a donnybrook. I don't think it had any bad consequences for the country, but it was a mess.

Reason: Speaking of donnybrooks, you were attacked in The New York Review of Books by New York University law professor Ronald Dworkin, and you responded in kind. I might add that, according to Fred R. Shapiro in The Journal of Legal Studies, you are the most frequently cited legal scholar, and Dworkin is number two. Do you have anything to add to this clash of the heavy hitters? He accused you of acting unethically as a sitting judge by injecting yourself into a partisan political debate with your book on the impeachment and by drawing conclusions about Clinton's guilt when he was open to future prosecution.

Posner: I usually don't respond to criticisms, and I wouldn't have responded to this one, but I didn't like being accused of an ethical violation. You can't really be impeached for something that minor, but you can be reprimanded by your court; that has happened to judges. So I thought I should respond, lest people think that I acknowledged it.

There was a letter later by an old guy who used to be a very prominent lawyer—maybe he still is, though he must be ancient—named John Frank, a lawyer in Arizona. In a letter to The New York Review of Books, he said he didn't think I had committed an ethical violation—he had a learned discussion of the esoteric issue—but he thought I had acted in bad taste. He may very well be right. I wouldn't take any umbrage at that, but the accusation that I had actually violated the code of judicial conduct….

Reason: You were, of course, attacked on both sides for the book.

Posner: This was funny: A high school classmate of mine is the parliamentarian of the House of Representatives, and he told me that Henry Hyde wanted to meet me. So the next time I was in Washington, I called up this fellow and he brought me over. Henry Hyde regaled me with a detailed critique of my book in which he picked out every criticism that I had made of the Republicans, which turned out to be quite numerous, and he rebutted them point by point. He was very pleasant about it; he's actually a very nice person. He seemed really sharp. I didn't agree with all his criticisms, but it was interesting that he took the time to prepare a rebuttal.

Reason: Was it tough to be the mediator in the Microsoft case? All of a sudden, you had the spotlight on you.

Posner: Yes, but I made clear at the outset that I would have no contact with the press, would not answer any questions, and wouldn't permit my staff to have any contact with the press. I thought that worked fine. The press didn't retaliate against me for not cooperating with them. What happened eventually, which was inevitable, was leaks by the parties. I didn't blame the press for their probing, but there were significant inaccuracies in the press reports, as you would expect, because they were depending on leaks.

Reason: In the 1980s, you wrote that the cost of limiting access to a work through copyright law has to be measured against the benefit the law provides—the incentive to create the work in the first place. Have things changed much since then, in particular because of the Internet and the ease of making and distributing digital copies?

Posner: There is a basic problem I have not solved. I don't know if anyone has. It is just extraordinarily difficult to know what is the optimal amount of any given body of intellectual property. That is one problem.

The second problem is it's extremely difficult to gauge the effect of intellectual property law on the amount of intellectual property. We know that if there were no copyright or patent or trade secret laws, there would be less invention and there would be less intellectual creativity. It's hard to imagine industries like the film industry or the book industry or the pharmaceutical industry functioning efficiently without intellectual property protection. The problem is that if you expand intellectual property protections, you can actually get to a point where you have as little intellectual property produced as you would if there were no protection, because all intellectual property trades on and embodies earlier intellectual property.

Suppose there were perpetual copyright, and it was very broad. So if you're making a movie you may have to find Homer's heirs and negotiate a copyright license with them. If someone had a patent on the wheel, every time you built a truck you would have to get a license from the descendents of some caveman who thought up the wheel. If there is too much protection of intellectual property it's stifling, and if there is too little it also stifles creativity.

Something like the Internet comes along, and on the one hand it makes it easier to steal, but on the other hand, by expanding the market for intellectual property, it also increases the returns. So how you figure out what the right approach is is baffling. People who know more about it than I do—like Larry Lessig of Harvard or Mark Lemley of Berkeley—they have strong views on this. Maybe they're right. But I don't know enough about it to have an opinion.

Reason: Looking at antitrust cases, without discussing Microsoft specifically, don't they often simply give an advantage to weak competitors who wouldn't otherwise make it?

Posner: That certainly is a danger, no question about it. It's true about any legal right that you give to a business firm. They will deploy it if they think they can increase their profits.

Reason: What is an example of a good antitrust action?

Posner: The core of antitrust is forbidding cartels and their informal counterparts, the price-fixing conspiracies, and preventing mergers that either create a monopoly or that so concentrate a market that they facilitate price fixing in a form difficult to deal with directly. That is the core. In the controversial area, there are the alleged exclusionary practices: tie-ins, predatory pricing, bundling, vertical integration, exclusive dealing, full line forcing, price discrimination, predatory advertising—all sorts of things, an endless list. Very controversial. There is unquestionably a sum of these shenanigans that is a proper concern of antitrust. It seems there are a lot of cases that don't make any sense at all. On the other hand, there are some cases where the defendant is a monopolist and, in rational self-interest, is engaging in a practice that could exclude equally or more efficient competitors.

Reason: What do you think of antidumping laws or predatory pricing laws?

Posner: I don't think antidumping laws really have anything to do with antitrust. A company that wants to fix prices in a market can do that only by limiting its output. If, rather than limit the output, it dumps its excess output in some other market at a very low price, it makes a little bit of money. But it's not trying to take over that second market; it's just trying to minimize its losses from the fact that it's curtailing its output. So it's not really a monopolistic practice.

There is a huge literature on predatory pricing now. There are some well-documented cases in which firms did engage in predatory pricing, and there is some theoretical basis for concern. On the other hand, it's very difficult to distinguish predatory pricing from simple price competition. The risk that a strict law on predatory pricing will discourage price competition and encourage collusion is very great. So you really have to tread delicately in that area.

Reason: As a pragmatist, how do you feel about the rule of law? Do you think it's an imaginary concept that people pull out to justify the result they prefer?

Posner: I wouldn't say that. It depends on how you define the rule of law. If the rule of law means that law has to be a closed, logical system, mechanically administered with no discretion for judges, I think that's wrong. If the rule of law means that the judges are constrained by rules, so far as those rules are knowable, then when the rules aren't knowable, when judges have discretion for whatever reason—the novelty of the issue, the confusion of the legislation, the vagueness of the constitutional provision—then the rule of law requires that the judges act in a nonpartisan fashion, that they be reasonable and intelligent and nonpolitical. That's the best you can expect of them if it's a truly ambiguous case.

Reason: In 1990 you wrote a famous concurring opinion in a case involving nude dancing, arguing that it has limited protection under the First Amendment. Was this part of being a pragmatic judge? Part of your reasoning seems to be that it's just too much trouble to prevent all sorts of nude dancing. If it's not based on rights, what's the argument?

Posner: As a libertarian, I don't think nude dancing in private should be regulated. But as a judge, my reaction is somewhat different, which is that the problem of drawing lines is impossible. This nude dancing, although it has minimal artistic value, is on a continuum with entertainment and art in general, which often has a strong erotic cast. The only reason to think this nude dancing was in a different class was that its artistic aspirations were extremely modest. But that doesn't seem to me a good reason for distinguishing it from lyric opera.

Reason: Do you get time to see movies and TV?

Posner: My wife and I don't go to the theaters; that's too much of a bother. But we rent movies or buy movies. I like comedies. I don't like serious movies. I make an occasional exception, but I like comedies and my tastes are pretty catholic. I'm very enthusiastic for the Marx Brothers; I like Joe Pesci a lot; I like Meg Ryan; I like the Cary Grant-Katharine Hepburn movies.

Reason: What about TV?

Posner: I do channel flipping late at night, so I see little pieces of this and that. Occasionally, I'll see an old movie or sometimes the animal channel. Or I'll watch the cable news programs. I don't have a very good sense of the full television sphere. I have never seen a situation comedy.

Reason: But you understand, as a libertarian, that some people like Jerry Springer and some people like PBS.

Posner: I actually had a case involving one of these let-it-all-hang-out talk shows. It was Jerry Lopez. Have you ever heard of him? He disappeared. He had one of these programs where ordinary people reveal their private lives in the most immodest fashion. That struck me as really vulgar, but if that's what people want. …It was all about 15-year-olds getting pregnant and being confronted by their mothers' lovers. Weird stuff, but the funny thing about it was they all seemed to be having a great time. The audience was really nosy, asking really personal questions—very vulgar entertainment for someone of my generation. But people are free to do whatever they want. It doesn't seem to do any harm.

Reason: You've said that if people were forced to stop watching TV, it's not as if they would turn to reading philosophy.

Posner: Sweden has very, very bad TV. They have only a few channels, poor reception, government channels. It's only on a few hours at night, I think. It's really incomplete. So I asked a friend of mine, a Swedish economist, what Swedes do. Do they read more? He said no. They don't read more. What they do, in contrast to America, is more family socializing. They draw with each other. Family socializing, family conversation takes place, usually on an extremely low plane. Americans probably are better informed than they would be if they had no television, because then they would just be talking to each other.