The Economic Consequences of Legal Decision Making by The Advocacy Foundation, Inc.

The e-Advocate Quarterly Magazine

The Economic Consequences of

Legal Decision-Making

Luke 14:28-30 28 For

which of you, intending to build a tower, sitteth not down first, and counteth the cost, whether he have sufficient to finish it? 29 Lest haply, after he hath laid the foundation, and is not able to finish it, all that behold it begin to mock him, 30 Saying, This man began to build, and was not able to finish.

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The Economic Consequences of Legal Decision-Making

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Biblical Authority ______

Proverbs 21:20 (KJV) 20

There is treasure to be desired and oil in the dwelling of the wise; but a foolish man spendeth it up. ______

Luke 14:28-30 (KJV) 28

For which of you, intending to build a tower, sitteth not down first, and counteth the cost, whether he have sufficient to finish it? 29 Lest haply, after he hath laid the foundation, and is not able to finish it, all that behold it begin to mock him, 30 Saying, This man began to build, and was not able to finish.

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Table of Contents ______

What Are The Economics of Legal Decision-Making

Positive Law and Economics Normative Law and Economics US v. Carroll Towing Co “Efficiency Theories” Pareto Efficiency Allocative Efficiency Kaldor-Hicks Efficiency

The Critical Legal Studies Movement The Costliness of Sanctions The Honorable Richard A. Posner The “Risk Tree” The Costs of Incarceration in the US

What Are The Economics of Legal Decision-Making ______ Law and Economics or Economic Analysis of Law is the application of economic theory (specifically microeconomic theory) to the analysis of law. Economic concepts are used to explain the effects of laws, to assess which legal rules are economically efficient, and to predict which legal rules should be promulgated. In the United States, economic analysis of law has been extremely influential. Judicial opinions utilize economic analysis and the theories of law and economics with some regularity. The influence of law and economics has also been felt in legal education. Many law schools in North America, Europe, and Asia have faculty members with a graduate degree in economics. In addition, many professional economists now study and write on the relationship between economics and legal doctrines. Anthony Kronman, former dean of Yale Law School, has written that "the intellectual movement that has had the greatest influence on American academic law in the past quarter-century [of the 20th Century]" is law and economics. As used by lawyers and legal scholars, the phrase "law and economics" refers to the application of microeconomic analysis to legal problems. Because of the overlap between legal systems and political systems, some of the issues in law and economics are also raised in political economy, constitutional economics and political science.

The one wing that represents a nonneoclassical approach to "law and economics" is the Continental (mainly German) tradition that sees the concept starting out of the governance and public policy (Staatswissenschaften) approach and the German Historical school of economics; this view is represented in the Elgar Companion to Law and Economics (2nd ed. 2005) and—though not exclusively—in the European Journal of Law and Economics. Here, consciously non-neoclassical approaches to economics are used for the analysis of legal (and administrative/governance) problems. In the early 1970s, Henry Manne (a former student of Coase) set out to build a center for law and economics at a major law school. He began at Rochester, worked at Miami, but was soon made unwelcome, moved to Emory, and ended up at George Mason. The latter soon became a center for the education of judges—many long out of law school and never exposed to numbers and economics. Manne also attracted the support of the John M. Olin Foundation, whose support accelerated the movement. Today, Olin centers (or programs) for Law and Economics exist at many universities. Important figures include the Nobel Prize winning economists Ronald Coase and Gary Becker, U.S. Court of Appeals for the Seventh Circuit judges Frank Easterbrook and Richard Posner, Andrei Shleifer and other distinguished scholars Page 6 of 31

such as Robert Cooter, Henry Manne, William Landes, and A. Mitchell Polinsky. Guido Calabresi, judge for the U.S. Court of Appeals for the Second Circuit, wrote in depth on this subject; his book The Costs of Accidents: A Legal and Economic Analysis (1970) has been cited as influential in its extensive treatment of the proper incentives and compensation required in accident situations. Calabresi took a different approach in Ideals, Beliefs, Attitudes, and the Law (1985), where he argued, "who is the cheapest avoider of a cost, depends on the valuations put on acts, activities and beliefs by the whole of our law and not on some objective or scientific notion" (69).

the fulfillment of a subset of optimal conditions cannot be met under any circumstances, it is incorrect to conclude that the fulfillment of any subset of optimal conditions will necessarily result in an increase in allocative efficiency. Consequently, any expression of public policy whose purported purpose is an unambiguous increase in allocative efficiency (for example, consolidation of research and development costs through increased mergers and acquisitions resulting from a systematic relaxation of anti-trust laws) is, according to critics, fundamentally incorrect, as there is no general reason to conclude that an increase in allocative efficiency is more likely than a decrease.

Rational Choice Theory Critics of the law and economics movements have argued that normative economic analysis does not capture the importance of human rights and concerns for distributive justice. Some of the heaviest criticisms of the "classical" law and economics come from the critical legal studies movement, in particular Duncan Kennedy[1] and Mark Kelman.

Pareto Efficiency Relatedly, additional critique has been directed toward the assumed benefits of law and policy designed to increase allocative efficiency when such assumptions are modeled on "first-best" (Pareto optimal) general-equilibrium conditions. Under the theory of the second best, for example, if

Essentially, the "first-best" neoclassical analysis fails to properly account for various kinds of general-equilibrium feedback relationships that result from intrinsic Pareto imperfections. Another critique comes from the fact that there is no unique optimal result. Warren Samuels in his 2007 book, The LegalEconomic Nexus, argues, "efficiency in the Pareto sense cannot dispositively be applied to the definition and assignment of rights themselves, because efficiency requires an antecedent determination of the rights." ______

Economic analysis of law is usually divided into two subfields: positive and normative.

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Positive Law and Economics ______

Positive Law and Economics uses economic analysis to predict the effects of various legal rules. So, for example, a positive economic analysis of tort law would Predict the Effects of a Strict Liability Rule as Opposed to the Effects of a Negligence Rule. Positive law and economics has also at times purported to explain the development of legal rules, for example the Common Law of Torts, in Terms of Their Economic Efficiency.

Normative Law and Economics Normative law and economics goes one step further and makes policy recommendations based on the economic consequences of various policies. The key concept for normative economic analysis is efficiency, in particular, Allocative Efficiency. A common concept of efficiency used by law and economics scholars is Pareto Efficiency. A legal rule is Pareto efficient if it could not be changed so as to make one person better off without making another person worse off. A weaker conception of efficiency is Kaldor-Hicks Efficiency. A legal rule is Kaldor-Hicks efficient if it could be made Pareto efficient by some parties compensating others as to offset their loss.

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US v Carroll Towing Co 159 F2d 169 (2d Cir. 1947)

______ Facts: A district court held Appellant (Conners Co.) partly liable for damage to a barge and for lost cargo by not having an attendant aboard the barge when it broke free from a pier. Appellant sought review. Appellant owned a barge, which was chartered by a railroad company. The barge, with a cargo of flour owned by the United States, was moored to the end of the pier. Appellant chartered a tug company, Carroll Towing Co. (Appellee) to drill out one of the barges. Appellee went aboard the barge and readjusted its mooring lines. The barge broke free of the mooring lines due to this readjustment. The Barge hit a tanker, and the tanker’s propeller broke a hole in the barge. The barge careened, dumped her cargo, and sank. No one was aboard at the time. Appellee argued that is someone was aboard the barge to observe it leaking after it broke free, the cargo and the barge could have been saved. Synopsis of Rule of Law: There is no general rule to determine when the absence of an attendant will make the owner of the barge liable for injuries to other vessels if she breaks away from her moorings. If he is found to be liable for injuries to others, then he must reduce his damages proportionately, if the injury is to his own barge. Vessels invariably suffer accidents. The owner’s duty, as in other similar situations, to prevent against resulting injuries is a function of three variables: (1) The

probability of the kind of incident in question; (2) the gravity of the resulting injury; and (3) the burden of adequate precautions. Issue: At issue is whether the Appellants should be held partly liable for damage to the barge and for the lost cargo by not having an attendant aboard the barge when it broke free from the pier. Holding: Appellants held partly liable. The court applied the ―burden was less than the injury multiplied by the probability‖ formula and found that the burden of having an attendant aboard the barge was less than the gravity of injury of a runaway barge multiplied by the probability that the barge would break free if unattended. Discussion. The Carroll case is noteworthy in that it utilizes a balancing test to determine whether a breach of the duty of ordinary care occurred. Most courts employ Judge Hand’s formulation: a comparable risk-benefit model. The Hand formulation provides that an actor is in breach if the burden of taking measures to avoid the harm would be less than the multiple of the probability of the kind of incident in question times the gravity of the harm should it occur, or:

B < PxL (Burden < Probability x Liability)

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Efficiency Theories Pareto Efficiency The Pareto Principle (also known as the 80–20 Rule, the Law of the Vital Few, and the Principle of Factor Scarcity) states that, for many events, roughly 80% of the effects come from 20% of the causes. Business-management consultant Joseph M. Juran suggested the principle and named it after Italian economist Vilfredo Pareto, who observed in 1906 that 80% of the land in Italy was owned by 20% of the population The Pareto principle is only tangentially related to Pareto efficiency. Pareto developed both concepts in the context of the distribution of income and wealth among the population. If we take the ten wealthiest individuals in the world, we see that the top three (Carlos Slim Helú, Warren Buffett, and Bill Gates) own as much as the next seven put together. In a 1992 United Nations Development Program Report, which showed the distribution of global income to be very uneven, with The Richest 20% of the

World's Population Controlling 82.7% of the World's Income. The distribution is claimed to appear in several different aspects relevant to entrepreneurs and business managers. For example: 

80% of a company's profits come from 20% of its customers

   

80% of a company's complaints come from 20% of its customers 80% of a company's profits come from 20% of the time its staff spend 80% of a company's sales come from 20% of its products 80% of a company's sales are made by 20% of its sales staff

Therefore, many businesses have an easy access to dramatic improvements in profitability by focusing on the most effective areas and eliminating, ignoring, automating, delegating or retraining the rest, as appropriate. ______

Pareto Efficiency, or Pareto Optimality, is a state of allocation of resources in which it is impossible to make any one individual better off without making at least one individual worse off. The term is named after Vilfredo Pareto (1848–1923), an Italian economist who used the concept in his studies of economic efficiency and income distribution. The concept has applications in academic fields such as economics and engineering. Given an initial allocation of goods among a set of individuals, a change to a different allocation that makes at least one individual better off without making any other individual worse off is called a Pareto Improvement. An allocation is defined as "Pareto efficient" or "Pareto optimal" when no further Pareto improvements can be made. For example, suppose there are two consumers A & B and only one resource X. Page 10 of 31

Suppose X is equal to 20. Let us assume that the resource has to be distributed equally between A and B and thus can be distributed in the following way: (1,1), (2,2), (3,3), (4,4), (5,5), (6,6), (7,7), (8,8), (9,9), (10,10). At point (10,10) all resources have been exhausted. No further distribution is possibleâ&#x20AC;&#x201D;if redistribution continues, it will lead to a position (11,9) or (9,11) that makes one better off and the other worse off. Hence, point (10,10) is Pareto optimal; no further Pareto improvements can be made.

Pareto efficiency is a minimal notion of efficiency and does not necessarily result in a socially desirable distribution of resources: it makes no statement about equality, or the overall well-being of a society. The notion of Pareto efficiency can also be applied to the selection of alternatives in [Law] and similar fields. Each option is first assessed under multiple criteria and then a subset of options is identified with the property that no other option can categorically outperform any of its members.

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Allocative Efficiency Allocative Efficiency is a type of economic efficiency in which economy/producers produce only those types of goods and services that are more desirable in the society and also in high demand. According to the formula the point of allocative efficiency is a point where price is equal to marginal cost (P=MC) or (MC=MR). At this point the social surplus is maximized with no deadweight loss, or the value society puts on that level of output produced minus the value of resources used to achieve that level, yet can be applied to other things such as level of pollution. Free markets under perfect competition generally are allocatively efficient. Although there are different standards of evaluation for the concept of allocative efficiency, the basic principle asserts that in any economic system, choices in resource allocation produce both "winners" and "losers" relative to the choice being evaluated. The principles of rational choice, individual maximization, utilitarianism and market theory further suppose that the outcomes for winners and losers can be identified, compared and measured. Under these basic premises, the goal of maximizing allocative efficiency can be defined according to some neutral principle where some allocations are objectively better than others. For example, an economist might say that a change in policy increases allocative efficiency as long as those who benefit from the change (winners) gain more than the losers lose. It is possible to have Pareto Efficiency without allocative efficiency. By shifting resources in the economy, a gain in benefit to one individual could be greater than the loss in benefit to another individual (see Kaldor-Hicks Efficiency). Therefore, before such a shift, the market is not allocatively efficient, but might be Pareto efficient. When a market fails to allocate resources efficiently, there is said to be Market Failure. Market failure may occur because of imperfect knowledge, differentiated goods, concentrated market power (e.g., monopoly or oligopoly), or externalities.

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Kaldor-Hicks Efficiency Kaldor–Hicks Efficiency, named for Nicholas Kaldor and John Hicks, also known as Kaldor–Hicks Criterion, is a measure of economic efficiency that captures some of the intuitive appeal of Pareto efficiency, but has less stringent criteria and is hence applicable to more circumstances. Under Kaldor–Hicks efficiency, an outcome is considered more efficient if a Pareto-superior outcome can be reached by arranging sufficient compensation from those that are made better off to those that are made worse off so that all would end up no worse off than before. Under Pareto efficiency, an outcome is more efficient if at least one person is made better off and nobody is made worse off. However, some believe that in practice, it is almost impossible to take any social action, such as a change in economic policy, without making at least one person worse off. Even voluntary exchanges may not be Pareto improving. Under ideal conditions, voluntary exchanges are Pareto improving since individuals would not enter into them unless they were mutually beneficial. However, a voluntary exchange would not be Pareto superior if external costs (such as pollution that hurt a third party) exist, as they often do. Using Kaldor–Hicks efficiency, an outcome is more efficient if those that are made better off could in theory compensate those that are made worse off, so that a Pareto improving outcome results. For example, a voluntary exchange that creates pollution would be a Kaldor–Hicks improvement if the buyers and sellers are still willing to carry out the transaction even if they have to fully compensate the victims of the pollution. The key difference is the question of compensation. Kaldor– Hicks does not require compensation actually be paid, merely that the possibility for compensation exists, and thus need not leave each at least as well off. Under Kaldor–Hicks efficiency, a more efficient outcome can in fact leave some people worse off. Pareto efficiency requires making every party involved better off (or at least no worse off). While every Pareto improvement is a Kaldor–Hicks improvement, most Kaldor–Hicks improvements are not Pareto improvements. This is because, as the graph above illustrates, the set of Pareto improvements is a proper subset of Kaldor–Hicks improvement, which also reflects the greater flexibility and applicability of the Kaldor–Hicks criteria relative to the Pareto criteria. For example, in a society with two people, suppose initially Person A has 10 sheep and Person B has 100 sheep. If some policy change or other shock results with Person A ending up with 20 sheep and Person B with 99 sheep, this change would not be Pareto improving, since Person B is now worse off. However, it would be a Kaldor–Hicks improvement, as Person A could theoretically give Person B anywhere between 1 and 10 sheep to accept this alternative situation. The Kaldor–Hicks methods are typically used as tests of Pareto efficiency rather than as efficiency goals themselves. They are used to determine whether an activity moves the economy Page 13 of 31

toward Pareto efficiency. Any change usually makes some people better off and others worse off, so these tests consider what would happen if gainers were to compensate losers or vice versa. The Kaldor criterion is that an activity contributes to Pareto optimality if the maximum amount the gainers are prepared to pay to the losers to agree to the change is greater than the minimum amount losers are prepared to accept; the Hicks criterion is that an activity contributes to Pareto optimality if the maximum amount the losers would pay the gainers to forgo the change is less than the minimum amount the gainers would accept to so agree. Thus, the Kaldor test supposes that losers could prevent the arrangement and asks whether gainers value their gain so much they would and could pay losers to accept the arrangement, whereas the Hicks test supposes that gainers are able to proceed with the change and asks whether losers consider their loss to be worth less than what it would cost them to pay gainers to agree not to proceed with the change. After several technical problems with each separate criterion were discovered, they were combined into the Scitovsky Criterion, more commonly known as the "Kaldor–Hicks criterion", which does not share the same flaws. The Kaldor–Hicks criterion is widely applied in welfare economics and managerial economics. For example, it forms an underlying rationale for cost-benefit analysis. In cost-benefit analysis, a project (for example, a new airport) is evaluated by comparing the total costs, such as building costs and environmental costs, with the total benefits, such as airline profits and convenience for travelers. (However, as cost-benefit analysis may also assign different social welfare weights to different individuals, e.g. more to the poor, the compensation criterion is not always invoked by cost-benefit analysis.) The project would typically be given the go-ahead if the benefits exceed the costs. This is effectively an application of the Kaldor–Hicks criterion because it is equivalent to requiring that the benefits be enough that those that benefit could in theory compensate those that have lost out. The criterion is used because it is argued that it is justifiable for society as a whole to make some worse off if this means a greater gain for others. The most common criticism of the Kaldor–Hicks criterion is the taking into account of only the absolute level of income, not its distribution. A related problem is that any social welfare functions based on Kaldor–Hicks criteria are cardinal in nature, and therefore suffer from the aggregation problems associated with discrepancies between the marginal value of money of rich and poor people. This has mainly to do with the assumption of diminishing marginal utility for income: taking one dollar from a poor person causes a greater loss in utility than taking a dollar from a rich one.

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The Critical Legal Studies Movement ______

Critical legal studies was a movement in legal thought in the 1970s and 80s committed to shaping society based on a vision of human personality devoid of the hidden interests and class domination that was perceived to be behind existing legal institutions. Adherents of the movement sought to destabilize traditional conceptions of law, and to unravel and challenge existing legal institutions. The more constructive members, such as Roberto Mangabeira Unger, sought to rebuild these institutions as an expression of human coexistence and not just a provisional truce in a brutal struggle, and were seen as the most powerful voices and the only way forward for the movement. Unger is one of the last standing members of the movement to continue to try to develop it in new directions—namely, to make legal analysis the basis of developing institutional alternatives.

adjudicators in the form of substantive rules, but, in the final analysis, this may often not be enough to bind them to come to a particular decision in a given particular case. Quite predictably, once made, this claim has triggered many lively debates among jurists and legal philosophers, some of which continue to this day (see further indeterminacy debate in legal theory). 

Secondly, there is the idea that all "law is politics". This means that legal decisions are a form of political decision, but not that it is impossible to tell judicial and legislative acts apart. Rather, CLS have argued that while the form may differ, both are based around the construction and maintenance of a form of social space. The argument takes aim at the positivist idea that law and politics can be entirely separated from one another. A more nuanced view has emerged more recently. This rejects the reductivism of 'all law is politics' and instead asserts that the two disciplines are mutually intertwined. There is no 'pure' law or politics, but rather the two forms work together and constantly shift between the two linguistic registers.



A third strand of the traditional CLS school is that far more often than is usually suspected the law tends to serve the interests of the wealthy and the powerful by protecting them against the demands of the poor and

Although the CLS (like most schools and movements) has not produced a single, monolithic body of thought, several common themes can be generally traced in its adherents' works. These include: 

A first theme is that contrary to the common perception, legal materials (such as statutes and case law) do not completely determine the outcome of legal disputes, or, to put it differently, the law may well impose many significant constraints on the

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the subaltern (women, ethnic minorities, the working class, indigenous peoples, the disabled, homosexuals, etc.) for greater justice. This claim is often coupled with the legal realist argument that what the law says it does and what it actually tends to do are two different things. Many laws claim to have the aim of protecting the interests of the poor and the subaltern. In reality, they often serve the interests of the power elites. This, however, does not have to be the case, claim the CLS scholars. There is nothing intrinsic to the idea of law that should make it into a vehicle of social injustice. It is just that the scale of the reform that needs to be undertaken to realize this objective is significantly greater than the mainstream legal discourse is ready to acknowledge. ď&#x201A;ˇ

ď&#x201A;ˇ

Furthermore, CLS at times claims that legal materials are inherently contradictory, i.e. the structure of the positive legal order is based on a series of binary oppositions such as, for instance, the opposition between individualism and altruism or formal realizability (i.e. preference for strict rules) and equitable flexibility (i.e. preference for broad standards). Finally, CLS questions law's central assumptions, one of which is the Kantian notion of the autonomous individual. The law often treats individual petitioners as having full agency vis-a-vis their opponents. They are able to make

decisions based on reason that is detached from political, social, or economic constraints. CLS holds that individuals are tied to their communities, socio-economic class, gender, race, and other conditions of life such that they cease to be autonomous actors in the Kantian mode. Rather, their circumstances determine and therefore limit the choices presented to them. People are not "free"; they are instead determined in large part by social and political structures that surround them. Increasingly, however, the traditional themes are being superseded by broader and more radical critical insights. Interventions in intellectual property law, human rights, jurisprudence, criminal law, property law, international law, etc., have proved crucial to the development of those discourses. Equally, CLS has introduced new frameworks to the legal field, such as postmodernism, queer theory, literary approaches to law, psychoanalysis, law and aesthetics, and post-colonialism. Prominent participants in the CLS movement include Drucilla Cornell, Alan Hunt, Catharine MacKinnon, Duncan Kennedy, David Kennedy, Martti Koskenniemi, Gary Peller, Peter Fitzpatrick, Morton Horwitz, Jack Balkin, Costas Douzinas, Peter Gabel, Roberto Unger, Renata Salecl, Mark Tushnet, Louis Michael Seidman, John Strawson and Martha Fineman.

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The Costliness of Sanctions ______ The United States has the highest documented incarceration rate in the world. At year-end 2009, it was 743 adults incarcerated per 100,000 population. Through the Juvenile Courts and the adult criminal justice system, the United States incarcerates more of its youth than any other country in the world, a reflection of the larger trends in incarceration practices in the United States. This has been a source of controversy for a number of reasons, including the overcrowding and violence in youth detention facilities, the prosecution of youths as adults and the long term consequences of incarceration on the individual's chances for success in adulthood. In 2014, the United Nations Human Rights Committee criticized the United States for about ten judicial abuses, including the mistreatment of juvenile inmates. According to federal data from 2011, around 40% of the nationâ&#x20AC;&#x2122;s juvenile inmates are housed in private facilities. In 2007, around $74 billion was spent on corrections. The total number of inmates in 2007 in federal, state, and local lockups was 2,419,241. That comes to around $30,600 per inmate. In 2005, it cost an average of $23,876 dollars per state prisoner. State prison spending varied widely, from $45,000 a year in Rhode Island to $13,000 in Louisiana. In California in 2008, it cost the state an average of $47,102 a year to incarcerate an inmate in a state prison. From 2001 to 2009,

the average annual cost increased by about $19,500. In 2003 among facilities operated by the Federal Bureau of Prisons, it cost $25,327 per inmate. Housing the approximately 500,000 people in jail in the USA awaiting trial who cannot afford bail costs $9 billion a year. Most jail inmates are petty, nonviolent offenders. Twenty years ago most nonviolent defendants were released on their own recognizance (trusted to show up at trial). Now most are given bail, and most pay a bail bondsman to afford it. 62% of local jail inmates are awaiting trial. To ease jail overcrowding over 10 counties every year consider building new jails. As an example Lubbock County, Texas has decided to build a $110 million mega-jail to ease jail overcrowding. Jail costs an average of $60 a day nationally. In Broward County, Florida supervised pretrial release costs about $7 a day per person while jail costs $115 a day. The jail system costs a quarter of every county tax dollar in Broward County, and is the single largest expense to the county taxpayer. Bondsmen have lobbied to cut back local pretrial programs from Texas to California, pushed for legislation in four states limiting pretrial's resources, and lobbied Congress so that they won't have to pay the bond if the defendant commits a new crime. Behind them, the bondsmen have powerful special interest group and millions of dollars. Pretrial release agencies have a smattering of public employees and the remnants of their once-thriving programs.

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â&#x20AC;&#x201D; National Public Radio, January 22, 2010. The National Association of State Budget Officers reports: "In fiscal 2009, corrections spending represented 3.4 percent of total state spending and 7.2 percent of general fund spending." They also report: "Some states exclude certain items when reporting corrections expenditures. Twenty-one states wholly or partially excluded juvenile delinquency counseling from their corrections figures and fifteen states wholly or partially excluded spending on juvenile institutions. Seventeen states wholly or partially excluded spending on drug abuse rehabilitation centers and forty-one states wholly or partially excluded spending on institutions for the criminally insane. Twenty-two states wholly or partially excluded aid to local governments for jails. For details, see Table 36." As of 2007 the cost of medical care for inmates was growing by 10 percent annually. ______ Critics have lambasted the United States for incarcerating a large number of non-violent and victimless offenders; half of all persons incarcerated under state jurisdiction are for non-violent offenses, and 20% are incarcerated for drug offenses (in state prisons, federal prison percentages are higher). "Human Rights Watch believes the extraordinary rate of incarceration in the United States wreaks havoc on individuals, families and communities, and saps the strength of the nation as a whole." The population of inmates housed in prisons and jails in the United States exceeds 2 million,

with the per capita incarceration population higher than that officially reported by any other country. Criminal Justice policy in the United States has also been criticized for a number of other reasons. Critics such as Angela Davis have argued that prisons in the U.S. have "become venues of profit as well as punishment;" as mass incarceration has increased, the prison system has become more about economic factors than criminality. In the 2014 book The Divide: American Injustice in the Age of the Wealth Gap, journalist Matt Taibbi argues that the expanding disparity of wealth and the increasing criminalization of those in poverty have culminated in the U.S. having the largest prison population "in the history of human civilization."

Guilty Plea Bargains Concluded 97% of All Federal Cases in 2011. ______

The US DOJ Smart on Crime Program On 12 August 2013, at the American Bar Association's House of Delegates meeting, Attorney General Eric Holder announced the "Smart on Crime" program, which is "a sweeping initiative by the Justice Department that in effect renounces several decades of tough-on-crime anti-drug legislation and policies." Holder said the program "will encourage U.S. attorneys to charge defendants only with crimes "for which the accompanying sentences are better suited to their individual conduct, rather than excessive prison terms more Page 18 of 31

appropriate for violent criminals or drug kingpinsâ&#x20AC;Ś" Running through Holder's statements, the increasing economic burden of over-incarceration was stressed. As of

August 2013, the Smart on Crime program is not a legislative initiative but an effort "limited to the DOJ's policy parameters."

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The Honorable Richard A. Posner Richard Allen Posner (/Ë&#x2C6;poĘ&#x160;znÉ&#x2122;r/; born January 11, 1939) is an American jurist, legal theorist and economist. He is currently a judge on the United States Court of Appeals for the Seventh Circuit in Chicago and a Senior Lecturer at the University of Chicago Law School. He is a leading figure in the field of law and economics, and was identified by The Journal of Legal Studies as the most cited legal scholar of the 20th century. Posner is the author of nearly 40 books on jurisprudence, economics, and several other topics, including Economic Analysis of Law, The Economics of Justice, The Problems of Jurisprudence, Sex and Reason, Law, Pragmatism and Democracy, and The Crisis of Capitalist Democracy. Posner has generally been identified as being politically conservative; however, in recent years he has distanced himself from this position. Posner is one of the most prolific legal writers, through both the number and topical breadth of his opinions, to say nothing of his scholarly and popular writings. Unlike many other judges, he writes all his own opinions. Nobel Laureate economist Robert Solow says that Posner "is an apparently inexhaustible writer on... nearly everything. To call him a polymath would be a gross understatement.... Judge Posner evidently writes the way other men breathe", though the economist describes the judge's grasp of

economics as, precarious."

"in

some

respects,

...

Aside from the sheer volume of his output, Posner's opinions enjoy great respect from other judges, based on citations, and within the legal academy, where his opinions are taught in many foundational law courses. An example is his opinion in Indiana Harbor Belt Railroad Co. v. American Cyanamid Co., a staple of first year Torts courses taught in American law schools, where the case is used to address the question of when it is better to use negligence liability or strict liability. In his decision in the 1997 case State Oil Co. v. Khan, Posner wrote that a ruling 1968 antitrust precedent set by the Supreme Court was "moth-eaten", "wobbly", and "unsound". Nevertheless, he abided by the previous decision with his ruling. The Supreme Court granted certiorari and overturned the 1968 ruling unanimously; Sandra Day O'Connor wrote the opinion and spoke positively of both Posner's criticism and his decision to abide by the ruling until the Court decided to change it. In 1999, Posner was welcomed as a private mediator among the parties involved in the Microsoft antitrust case. A study published by Fred Shapiro in the University of Chicago's The Journal of Legal Studies found Posner is the most-cited legal scholar of all time by a considerable margin, as Posner's work has generated 7,981 cites compared to the runner-up Ronald Dworkin's 4,488 cites.

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As a judge, Posner's rulings have always placed him on the moderate-to-liberal wing of the Republican Party, where he has become more isolated over time. In July 2012, Posner stated, "I've become less conservative since the Republican Party started becoming goofy." Among Posner's judicial influences are the American jurists Oliver Wendell Holmes, Jr. and Learned Hand.

has 1 percent of the mental ability of a normal human being, would require the sacrifice of the human being to save 101 chimpanzees." Antitrust

Posner has written several opinions sympathetic to abortion rights, including a decision that held that "partial-birth abortion" was constitutionally protected in some circumstances.

Along with Robert Bork, Posner helped shape the antitrust policy changes of the 1970s through his idea that 1960s antitrust laws were in fact making prices higher for the consumer rather than lower, while he viewed lower prices as the essential end goal of any antitrust policy. Posner's and Bork's theories on antitrust evolved into the prevailing view in academia and at the Justice Department of the George H. W. Bush Administration.

Animal rights

Bluebook

Posner engaged in a debate on the ethics of using animals in research with the philosopher Peter Singer in 2001 at Slate magazine. He argues that animal rights conflict with the moral relevance of humanity and that empathy for pain and suffering of animals does not supersede advancing society. He further argues that he trusts his moral intuition until it is shown to be wrong and that his moral intuition says that "it is wrong to give as much weight to a dog's pain as to an infant's pain." He leaves open the possibility that facts on animal and human cognition can and may change his intuition in the future; he further states that people whose opinions were changed by consideration of the ethics presented in Singer's book Animal Liberation failed to see the "radicalism of the ethical vision that powers [their] view on animals, an ethical vision that finds greater value in a healthy pig than in a profoundly retarded child, that commands inflicting a lesser pain on a human being to avert a greater pain to a dog, and that, provided only that a chimpanzee

Posner is "one of the founding fathers of Bluebook abolitionism, having advocated it for almost twenty-five years, ever since his 1986 University of Chicago Law Review article on the subject." In a 2011 Yale Law Journal article, he wrote:

Abortion

The Bluebook: A Uniform System of Citation exemplifies hypertrophy in the anthropological sense. It is a monstrous growth, remote from the functional need for legal citation forms, that serves obscure needs of the legal culture and its student subculture. Drugs Posner opposes the US "War on Drugs" and called it "quixotic". In a 2003 CNBC interview he discussed the difficulty of enforcing criminal marijuana laws, and asserted that it is hard to justify the criminalization of marijuana when compared to other substances. In a talk at Elmhurst College in Page 21 of 31

2012, Posner said that "I don't think that we should have a fraction of the drug laws that we have. I think it's really absurd to be criminalizing possession or use or distribution of marijuana." Newspapers Posner supported the creation of a law barring hyperlinks or paraphrasing of copyrighted material as a means to prevent what he views as free riding on newspaper journalism. His co-blogger Gary Becker simultaneously posted a contrasting opinion that while the Internet might hurt newspapers, it will not harm the vitality of the press, but rather embolden it.

the secret recording of conversations without the consent of all the parties to the conversation, Posner was to deliver another memorable quote. At issue was the constitutionality of the Illinois wiretapping law, which makes it illegal to record someone without consent even when filming public acts like arrests in public. Posner interrupted the ACLU after just 14 words, stating, "Yeah, I know. But I’m not interested, really, in what you want to do with these recordings of peoples’ encounters with the police...." Posner continued: ―Once all this stuff can be recorded, there’s going to be a lot more of this snooping around by reporters and bloggers.... I'm always suspicious when the civil liberties people start telling the police how to do their business." The 7th Circuit upheld the challenge 2-1, striking down the Eavesdropping Act, but Posner wrote a dissenting opinion. Prisoners

Patent and Copyright Law Posner has expressed concerns, on the blog he contributes to with Gary Becker, that both patent and copyright protection, though particularly the former, may be excessive. He argues that the cost of inventing must be compared to the cost of copying in order to determine the optimal patent protection for an inventor. When patent protection is too strongly in favor of the inventor, market efficiency is decreased. He illustrates his argument by comparing the pharmaceutical industry (where the cost on invention is high) with the software industry (where the cost of invention is relatively low). Police recording As part of a three-judge panel on the 7th Circuit in Chicago, weighing a challenge to the Illinois Eavesdropping Act, which bars

In a dissent from an earlier ruling by his protégé Frank Easterbrook, Posner wrote that Easterbrook's decision that female guards could watch male prisoners while in the shower or bathroom must stem from a belief that prisoners are "members of a different species, indeed as a type of vermin, devoid of human dignity and entitled to no respect.... I do not myself consider the 1.5 million inmates of American prisons and jails in that light." Privacy Posner thinks that privacy as a social good is overrated: "I'm exaggerating a little, but I think privacy is primarily wanted by people because they want to conceal information to fool others." According to one author, Posner claims that "breaking down privacy domains and promoting transparency of the Page 22 of 31

population is economically and morally beneficial. Paradoxically though, for Posner, wealth maximization means that businesses

should be afforded greater levels of privacy because placing businesses under the public spotlight harms economic growth."

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The â&#x20AC;&#x153;Risk Treeâ&#x20AC;? ______

Exhonerated -010-Day Hearing $$$ Detention $$$$

Arrest

Release from System

Release to Parent -0-

Adjudicatory Hearing - Pub Def $$$

Alternative to Detention -0-

Disposition Hearing $$$

Detention & Confinement $$$$ $$$$ $$$$ $$$$

Probation $$

Page 24 of 31

The Costs of Incarceration In the United States

The term "prison-industrial complex" (PIC) is used to attribute the rapid expansion of the US inmate population to the political influence of private prison companies and businesses that supply goods and services to government prison agencies. Such groups include corporations that contract prison labor, construction companies, surveillance technology vendors, lawyers, and lobby groups that represent them. Activists have argued that the prison-industrial complex is perpetuating a flawed belief that imprisonment is an effective solution to social problems such as homelessness, unemployment, drug addiction, mental illness, and illiteracy. The promotion of prison-building as a job creator and the use of inmate labor are also cited as elements of the prison-industrial complex. The term often implies a network of actors who are motivated by making profit rather than solely by punishing or rehabilitating criminals or reducing crime rates. Page 25 of 31

Treatment v. Incarceration

Mentorship v. Incarceration

College or Rehab v. Incarceration

Page 26 of 31

Rehab v. Jail

Youth Programs v. Incarceration

Page 27 of 31

Cost of Wrongful Convictions

Top Reasons for Wrongful Conviction

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Notes ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ ______________________________________________________________________________ Page 29 of 31

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About The Author † John C (Jack) Johnson III Founder & CEO

John C. (Jack) Johnson III was educated at Temple University, in Philadelphia, Pennsylvania and Rutgers Law School, Camden, New Jersey. In 1998, he moved to Atlanta, Georgia in order to pursue greater opportunities to provide advocacy and preventive programmatic services for at-risk young persons and their families caught-up in the Juvenile Justice process. There, along with a small group of community and faith-based professionals, “The Advocacy Foundation, Inc." was conceived and implemented over a ten year period, originally chartered as a Juvenile Delinquency Prevention and Educational Support Services organization consisting of Mentoring, Tutoring, Counseling, Character Development and a host of related components. The Foundation’s Overarching Mission is “To help Individuals, Organizations, & Communities Achieve Their Full Potential”, by implementing a wide array of evidence-based proactive multi-disciplinary "Restorative Justice" programs & projects throughout the northeast, southeast, and eastern international-waters regions, providing prevention and support services to at-risk youth, young adults, and their families, as well as to Social Service, Juvenile Justice and Mental Health professionals” everywhere. The Foundation has since relocated its headquarters to Philadelphia, Pennsylvania, and been expanded to include a three-tier mission. In addition to his work with the Foundation, Jack also served as an Adjunct Professor of Law & Business at National-Louis University of Atlanta (where he taught Political Science, Business Ethics, and Labor & Employment Relations to undergraduate and graduate level students. He has also served as Board President for a host of up & coming nonprofit organizations throughout the region, including “Visions Unlimited Community Development Systems, Inc.”, a multi-million dollar, award-winning, Violence Prevention and Gang Intervention Social Service organization in Atlanta, as well as Vice-Chair of the Georgia/ Metropolitan Atlanta Violence Prevention Partnership, a state-wide 300 member violence prevention organization.