Month: October 2023

End Tipping

I believe that the price should be the price. If you’re shopping for a cell phone plan, you should be able to, as they say, compare apples to apples. Instead, the carriers advertise a price (or perhaps an introductory price), but you have to pay various taxes and fees on top of that, which means that you will pay more, sometimes a lot more.1 In keeping with this view, I have previously stated: “I would prefer that the waitstaff be paid a full wage by management and that cost be reflected in the cost of food and drink with no tipping expected or required to assure that servers are paid fairly.”

Last week CNN.com published an opinion piece, “Restaurants should end tipping for good,” which has this (accurate) observation: “[T]ipping has always been a scam that enables restaurants to suppress labor costs, which keeps menu prices down. This sustains the illusion of an affordable dining experience because the customer is expected to pay for the labor of service staff instead of the employer.”

This goes for any other service where a “voluntary” gratuity is expected. The customer should be told (in advance) what they service will cost and expected to pay that amount (and no more). The service establishment should adjust its price and pay its employees accordingly.

Jay Bohn

October 30, 2023

  1. I also believe, perhaps a bit to the contrary, that taxes should be separately stated so that the consumer knows how much is being taken by the government. ↩︎

Recent NJ.com Article a “Three-For”

An article I saw on NJ.com Monday is interesting for three reasons.

The article, “N.J. residents actually say yes to a tax hike if it’s spent on this, new poll says” (subscriber exclusive) states that 54% of State residents (according to one poll) support the further extension of a “temporary” corporate tax surcharge to provide funding for NJ Transit.1

First, the article’s title (headline) is phrased to entice the reader to click on it to find out what spending is entitled to support for a tax hike. I have previously complained about titles that do “not adequately convey what the article is about but instead serves as a piece of “click-bait” to excite the reader’s curiosity to go to the article (thus generating ad revenue).”

Second, I have also previously posted about this particular “temporary” tax increase and the Star-Ledger’s desire to make it permanent.

Third, many of the Star Ledger’s unlabeled opinion pieces have reflected support for a dedicated funding source for NJ Transit. As a matter of policy, I oppose dedicated funding; every government agency should have to make the case for taxpayer money on a regular basis.2

Jay Bohn

October 26, 2023

  1. No doubt that support derives from the fact that someone else (large corporations) is seen as paying the tax but the people responding to the poll will benefit. As I’ve said before, the government that robs Peter to pay Paul can always count on the support of Paul. ↩︎
  2. (Indeed, I suspect that the whole purpose of the poll (and perhaps the article as well) was to claim that there is public support for NJ Transit funding; must have been disappointed that the support was only at 54%. ↩︎

Trump Disqualification 3 Redux: Whether Trump Took an Oath to “Support” the Constitution Getting Some Attention

Last month I posted a series on the elements I saw as necessary to be established by those who seek to have Donald Trump declared to be disqualified from again serving as president under section 3 of the Fourteenth Amendment. This series was published in light of the pending petition seeking to exclude Trump from the Colorado primary ballot. (docket entries here)

My second element was whether Trump took an oath to “support” the Constitution given that the only oath of office he ever took was the presidential oath which requires one to “preserve, protect, and defend” but not “support” the Constitution. Recently I was told that I was one of the first, if not the first, to make this particular argument. That was rather surprising, but I have not been able to find it made earlier. Whether I am first or not, however, President Trump used it as part of a motion to dismiss the Colorado petition. (Other than timing, I have no evidence that Trump’s attorneys got the argument from me.)

So far, the petitioners do not seem to have responded to Trump’s invocation of that argument and it was not part of the judge’s Omnibus Ruling on Pending Dispositive Motions which was released last Friday.

Elimination of Saturday Print Edition the Beginning of the End for Star-Ledger Newspaper

Last month the Star-Ledger announced that December 30, 2023, would mark the last Saturday print edition of the newspaper. (Its sister publication, the Express-Times made a similar announcement.) In the perhaps not so distant future when the obituary for this print newspaper is written this event will mark a turning point.

To be sure, the economic and social forces that seem inexorably to be leading to this result started long ago and the loss of one day a week’s print newspaper is more effect than cause,1 but I believe that it marks the point where it became inevitable that local news for most of us, such as it is, will be available only on-line.

One must not forget that newspapers, as important to democracy and even noble as they want to believe they are, are also, at bottom, profit-seeking businesses. Businesses seek ever to grow larger and operate more efficiently. I see newspaper consolidation, both within the same market and then on a regional basis, as a significant factor in their current problems.

Imagine, in those halcyon days of yore, that many communities were served by multiple local newspapers, giving their customers all of the benefits flowing from competition, great service at low prices. Then imagine either the closing of the economically weaker newspaper or its acquisition by the stronger: the Newark Star-Eagle and the Newark Ledger combine to form the Newark Star-Ledger.

But the newspaper’s circulation is not limited to a single city. Its subscribers may include suburban residents who commute to work in the city or are just civically engaged. The newspaper may serve these customers by providing news coverage of events in their towns. To the extent that other newspapers already serve the local suburban market, they fail or are bought up. Then imagine that the newspaper sees the marketing advantage in omitting the geographic descriptor.2 The Newark Star-Ledger becomes the Star-Ledger.

This intra- and inter-municipal consolidation broadens the audience served, but also results in less focused local coverage. Reporters cease to attend local government meetings. Citizens lose access to information on what their local governments are doing on a day-to-day basis. Customers drop off.

Other media then take some of the remaining customers. The internet is a major factor today, but it started with radio and television. They lack the ability to provide the extensive, comprehensive news coverage I would like to see. A few minutes at the top of the hour, or a half-hour at dinner time (further reduced by commercials and including not just “real news,” but also sports, weather, and fluff, just can’t replace the newspaper.

In some way, the internet does not suffer these limitations, and it is not a foregone conclusion that it cannot serve as a worthy substitute, but it has yet to prove to be the case. Websites can be very splashy, but they need content. Their owners can pay reporters or seek volunteers. A few volunteers may be motivated and dedicated, but this is not a realistic business model. So, they have to pay reporters, which just recreates the problem in another medium.3

Jay Bohn

October 19, 2023

  1. It is part of a cycle where service-cutting and price increases meant to deal with the loss of subscribers only drives more people away, just like the postal service. ↩︎
  2. In this imagined past the reason for this is not dissatisfaction with anything about Newark, just the concern that the inclusion of one location’s name will run counter to the message that the publication is equally useful to suburban residents: “It’s not my local paper, I don’t live in Newark.” Many newspapers have eliminated reference to a specific community in their name. ↩︎
  3. I will admit that it seems likely to me that the cost of distributing news via a website is likely to be less than having to buy paper and ink, run a printing press and distribute physical newspapers, but I doubt that this difference is going to solve all the problems. ↩︎

Media Coverage of Blankenship Cert Denial Remarkable for Its (Mostly) Lack of Hyperbole

Over time tort law has become reluctant to provide compensation for harms to reputation caused by what people say or print.1 In New Jersey the statute of limitation for a defamation action is just one year from the date of publication. If the alleged defamatory matter is true, well that’s an absolute defense (although it has not always been). And only statements of fact, as opposed to opinion, are actionable.

Since the 1964 case of New York Times Co. v. Sullivan,2 the First Amendment has been interpreted to protect the news media from liability for defamatory falsehoods against public figures unless the statement was made with “actual malice,” either knowledge that the statement was false or reckless disregard as to whether it was true or false. The commercial media understandably view this decision as an important one.

It is not, however, without its critics, one of whom is Supreme Court Justice Clarence Thomas, who has been known to question the correctness of many prior decisions. In McKee v. Cosby, 586 U. S. ___ (2019), Thomas concurred in the denial of certiorari but called for the re-examination of Sullivan. He did the same thing last Tuesday in Blankenship v. NBCUniversal, 601 U. S. __ (2023).

Media reaction has been a bit more subdued than I might have expected. Yes, BNN Breaking, a news website of which I was previously unaware, called the denial of certiorari a “landmark decision” with “far-reaching implications, carving the path for future defamation cases and highlighting the crucial balance between freedom of the press and individual reputation.”3 But much of the other coverage, from, for example, CNN, The Volokh Conspiracy, and even the New York Times itself, has been sober, factual, and accurate.

Jay Bohn

October 16, 2023

  1. The generic term is “defamation,” with “slander” being the more specific term for spoken remarks and “libel” for things printed. ↩︎
  2. I won’t be looking there for informed legal analysis anytime soon. ↩︎

Latest Existential Challenge to CFPB Appears to Fizzle

Not every bad policy is unconstitutional. The case in point is the funding mechanism for the Bureau of Consumer Financial Protection established by the Dodd–Frank Wall Street Reform and Consumer Protection Act (P.L. 111-203), which prefers to call itself the Consumer Financial Protection Bureau (“CFPB“). When the 111th Congress created the agency, it tried to entrench its policy views against the possibility that a later (Republican) congressional majority or president would disagree with them. For example, as originally conceived, the agency is headed by a single director, removable by the President only for cause. Thus, when Donald Trump became President, he was not able to replace the Obama-appointed incumbent.1 This feature of the agency was declared unconstitutional in Seila Law LLC v. Consumer Financial Protection Bureau, 591 U.S. ____ (2020).

The CFPB is not funded through the annual (and usually dysfunctional) budget process. It gets to requisition the funding it wants (up to a limit that it has never actually reached) from the Federal Reserve. Opponents of one set of its regulations, those relating to payday lending, used the funding mechanism as one of the bases for a challenge to the regulations. CFPB v. Consumer Financial Services Assn. (22-448).2

One part of Article I, section 9, of the U.S. Constitution, called the Appropriation Clause, provides: “No Money shall be drawn from the Treasury, but in Consequence of Appropriations made by Law . . . .” The argument is that because the CFPB is not subject to the annual budget process like everyone else, its ability to call for money from the Fed is unconstitutional and this means it cannot validly promulgate the payday lending rules.

There’s really a lot wrong with this argument, starting with its disconnect from the actual text of the Appropriations Clause. There is no requirement of any annual process. Indeed, the only constitutional durational limit on an appropriation is the two-year maximum for an appropriation for the Army contained in Article I, section 8. Not every other part of the federal government goes hat in hand to Congress every year. These were two of the issues discussed at length at the Supreme Court oral argument on October 3, 2023 (audio | transcript). They didn’t even have time to get to the question of how the possible issue of the funding mechanism means that one particular set of regulations that it adopted is invalid.3

I don’t see the votes to sustain the Court of Appeals’ decision, so expect the CFPB to survive.

But not everything that is constitutional is good policy. This case generated a lot of amicus activity (non-parties who obtain permission to file briefs in the case), one of whom was former acting director Mulvaney himself. His brief, although somewhat tangential to the discrete issues to be decided, was replete with well-taken criticisms of the agency.

Jay Bohn

October 12, 2023

  1. In 2017 the first CFPB director, Richard Cordray, resigned as director in order to run for governor of Ohio. Immediately before leaving Cordray appointed CFPB chief counsel Leandra English to the vacant post of executive director with the expectation that she would continue as acting director. President Trump appointed his OMB director, Mick Mulvaney, acting director under different legislation. English was not successful in her subsequent lawsuit to claim the job. ↩︎
  2. The challengers actually won on this issue in the Court of Appeals, so the CFPB is the petitioner in the Supreme Court. ↩︎
  3. For more detail on the argument, if you don’t have time to read or listen to it yourself, read Amy Howe, Court divided over funding mechanism for consumer watchdog, SCOTUSblog (Oct. 3, 2023, 5:33 PM), https://www.scotusblog.com/2023/10/court-divided-over-funding-mechanism-for-consumer-watchdog/ ↩︎

Moran Editorial on Hudson County Prosecutor Shows Need for (and Failure of) Newspapers

Yesterday Star-Ledger Editorial Page Editor Tom Moran published a column entitled “Biden rejected Hudson County Prosecutor. Why Murphy Didn’t.”1 According to Moran, the indictment of Senator Robert Menendez states that Menendez recommended Hudson County prosecutor Esther Suarez to President Biden as U.S. Attorney for New Jersey because he believed that she would go easy on fraud charges against his co-defendant Fred Daibes. I won’t spoil the rest for you; the column is worth a read.2

It may not have been Moran’s intent, but the whole situation shows the critical importance of newspapers (and I mean print newspapers, not TV news and not even online newspapers) to inform the citizenry what its government is doing to it. The only way to fight political machines is to make sure that the people know what is going on.

While I’m certain that Moran would agree to the importance of newspapers, I am not convinced that he would admit they are doing a horrible job. They need to give us facts, not just spoon feed the opinions we ought to have.

Jay Bohn

October 8, 2023

  1. As usual, the online version has a slightly different title: “Biden rejected Hudson Prosecutor Esther Suarez. Here’s why Gov. Murphy didn’t.” (subscriber exclusive) ↩︎
  2. If you’re a subscriber of course. ↩︎

Sick Pay Is Abused Because No One Wants to Leave Money on the Table

NJ.com/The Star-Ledger has recently had a couple of pieces railing against “boat checks,” payments to retiring public employees for sick time accumulated but not used over many years of employment. As this editorial points out, it can be big bucks for the favored few and it could be prevented (but won’t be until public officials face significant economic consequences or jail time, but that’s for another rant.)

The same publications push for mandating paid sick leave (see here for example).1 Sick leave should only be used when the employee is sick (allowing for medical appointments and family members as well.) My position is that if the government is going to mandate that employers provide this benefit, it should punish employees who treat it as a vacation day that they can take without notice.

Sick leave is like insurance; everyone wants to get more in benefits than she pays in. No one wants to work more days than his colleagues just because he didn’t get sick.

Jay Bohn

October 5, 2023

  1. I wonder if the Star-Ledger mandates that benefit for the people who delivers its newspapers in its contracts with the distribution agent. Probably not. ↩︎

Happy New (Fiscal) Year

The federal government’s fiscal year begins October 1. Ideally, all of the annual appropriation bills will have been passed by then. That hasn’t been the case, however, for many years. Congress must pass a stopgap funding measure to prevent a shutdown, usually kicking the can down the road until there is a shutdown, or a compromise. The stopgap bills are “must pass” legislation, so there is often a chance for chicanery.

Members of both parties play a big game of chicken. In the end massive omnibus bills are passed that no one has time to read.

Not that I have a solution for this, but I would offer for consideration the idea of two-year budget cycles, so we don’t go through it every year.

Jay Bohn

October 2, 2023