Bargaining With the State PDF
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Published in 1985, Richard Epstein's influential and widely read book Takings staked out the controversial position that the takings clause of the Constitution invalidated most forms of economic regulation and most major social welfare programs of the New Deal. In this sequel, Bargaining with the State, he examines the threats to liberty that arise not through direct legislative command but through the power of government selectively to distribute benefits and favors to its citizens through grants, contracts, licenses, tax exemptions, and access to public property. His aim is to show that government use of monopoly power in bargaining can be just as dangerous as its direct exercise of the power of taxation and regulation. For Epstein, the preservation of individual liberty against government contractual power advances not only the short-term interest of the individual citizen but also the long-term overall social welfare. In Takings, Epstein argued that the takings clause was crafted to ensure to the extent possible that no individuals were net losers from government programs of taxation or regulation. Today in Bargaining with the State, he turns to the fair distribution of the gains from desirable government programs and the implicit peril to individual liberty and social welfare when government attaches strings to persons receiving its benefits. In so doing he offers a rigorous solution to the so-called paradox of unconstitutional conditions: why people bargaining with the state need not always take the bitter with the sweet, but may sometimes keep the government benefit while cutting the government string. Signs of this basic dilemma are evident everywhere. The government need notbuild roads. But if it does it cannot admit citizens only on condition that they support the incumbent administration, or cease criticism of it, even if they are willing to do so. Likewise if the government cannot govern the internal operations of religious institutions, then, Epstein maintains, it cannot constitutionally seek to influence their behavior by the selective award of tax benefits. Thus he takes the Supreme Court to task for its widely praised decision in the well-publicized Bob Jones University case, where the Court upheld the government decision to deny Bob Jones University its tax-exempt status solely because it had refused, for religious reasons, to allow interracial dating and marriage among its students. So long as the first amendment protected the free exercise of religion, argues Epstein, the government could not properly condition the tax exemption on Bob Jones's abandonment of its policies, when other religious institutions could enjoy exemptions while retaining complete internal control over their own affairs. Epstein extends his analysis to a wide range of explosive issues that involve the funding of education, welfare, and the arts. He explains how similar problems arise in connection with such apparently mundane matters as the use of public highways, and the power of the government to control land use and to license persons to practice the various learned professions. And he shows what happens when the federal government, as a modern Leviathan, uses conditional grants to undermine the powers of the several states, or when one state seeks to use its own power to gain disproportionate influence over other states. What lends this book special intellectual power isEpstein's thorough effort to link the principles of constitutional law to those that govern ordinary individuals in private disputes. Unlike most constitutional law scholars, Epstein has taught and written extensively in the private law of property, torts, and contract. His analysis of coercion as it is used in private law provides the base for his carefully assembled constitutional structure. Epstein also draws on his wide knowledge of legal history, philosophy, game theory, and the relationship of law and economics to make Bargaining with the State an interdisciplinary study that should be required reading not only for lawyers but for scholars and citizens of all outlooks and backgrounds who are interested in understanding the perennial questions of the use and limits of government power.
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