SharksWithLasers -- Seth Cooper

A CUTTING-EDGE BLOG FOR THE WORLD OF THE 21st CENTURY, Currently operated by Seth L. Cooper, a 27 year-old attorney in Seattle (sethlcooper at comcast dot net)

Wednesday, March 02, 2005

SPITZER STUFF. Matthew Continetti’s new Weekly Standard article “I, Spitzer” provides some interesting insight into NY’s big, bad Attorney General. It is a lengthy piece, and so while I will not go into detail on it, I will mention a few noteworthy items.

Continetti describes Spitzer and his powerful, active office as follows:

The attorney general of New York sits atop a huge and roiling bureaucracy; Spitzer employs 600 lawyers in four divisions divided into 16 bureaus scattered throughout 13 regional offices. At any given moment these lawyers are involved in thousands of cases. ("It's virtually impossible to get a count," one of his aides told me.) The tenor of these investigations is a function of the attorney general's politics. Spitzer's great innovation was to talk like a Republican and litigate like a Democrat.

An interesting story follows, however, about the number of campaign contributions that certain corporations have made to Spitzer’s campaign—and remained unscathed by litigation. Further, Continetti also describes how an intriguing number of Spitzer lieutenants have been hired by corporations who presumably would like to stay under his good graces. He goes on to say:

Burrow through all this material, and suddenly you are struck with the impolite notion that maybe the attorney general isn't saving--or even practicing--capitalism. Shear away all the highfalutin' language, and you begin to think that Spitzer looks more like a traditional political boss: rewarding his friends, and punishing his enemies.

In addition to describing some of Spitzer’s background and his rise to prominence though his office’s activities, Continetti discusses how reliant Spitzer is upon the “investor class” concept. (Roughly, the idea that when people become investors, they will begin to vote Republican.) Continetti, however, argues it to be a myth and writes of some corresponding concerns:

But while universal stock ownership may be desirable for other reasons--most economists believe that lower-income Americans would benefit from having at least some of their savings in stocks--it hardly guarantees political catnip for Republicans. For one thing, if 80 or 90 percent of Americans own stocks and bonds, "investors" will no longer be a class at all--unless it's the class of all voters, in both parties. Furthermore--and more immediately--there's a corollary to the investor-class thesis that favors Democrats. As more people enter the market, they may turn to politicians who offer protection from rapacious capitalists and irresponsible money managers. Burned by market downturns, they will want politicians to go after those who did them harm. And those politicians, in turn, will say they are "saving" markets in the process. Politicians like Eliot Spitzer.

Reading this article brought back memories of Dr. Michael Greve’s Federalist Outlook issue from 2002, entitled “Free Eliot Spitzer!” Greve provides an interesting-as-always discussion of competitive federalism principles, while taking on some of the problems that such a perspective reveals in some of the out-of-court regulations that Spitzer has helped to create.

Notes Greve:
Attorneys general have over the past decade managed to create a parallel national government on issues from product safety to antitrust law to tobacco regulation. In all those areas, some enterprising attorney general has reversely preempted the national government, typically in cahoots with trial lawyers and his fellow attorneys general. In all instances, the usurpation was made possible by the effectively unbounded extraterritorial reach of the usurpers' authority. What distinguishes the Spitzer campaign is its creator's enthusiasm in shouting his national ambition from the rooftops.

One can hardly defend deceptive practices in brokerage houses, but the primary issue for Greve is structural:

the notion that a state attorney general should push the national government into action perverts federalism. Putting aside that even captured federal bureaucrats may have independent, respectable reasons for doing nothing, our system of checks and balances is intentionally designed to impede federal action. Spitzerian policy entrepreneurship leaves Congress and the SEC no choice but to intervene, lest the securities markets be regulated into the ground by fifty ambitious state attorneys general whose agendas conflict in all respects but one—headline hunting. A state official's power to drive national action in this officious fashion is a power to preempt the national government. It is federalism upside-down.

Spitzer has announced his candidacy for Governor of New York. As the top Executive of the Empire State, I actually suspect his influence to DIMINISH nation-wide. A sad irony.

(North Seattle--Green Lake, WA)


Post a Comment

<< Home