TCS Daily

Where Might Harriet Miers Make Her Mark?

By Stephen Bainbridge - October 14, 2005 12:00 AM

It's no secret that President Bush's nomination of Harriet Miers sharply divided his base, especially that part of which hangs out in the right-of-center blogosphere. On my blog, I've been critical of the choice. Let's assume that Miers is eventually confirmed, however. Where is she likely to make her mark?

The business community clearly believes Miers will be strongly pro-business, which seems highly plausible given her business law background. As the Christian Science Monitor recently reported:

        ... nearly lost in the tide of comment is the Washington business community's 
        developing interest in Ms. Miers. With on-the-ground experience in 
        corporate law, she has a background that they say has been missing 
        on the high court in recent years. ...

        "The president's nomination of Harriet Miers is a good pick for the US 
        Supreme Court," said Chamber President and CEO Thomas Donohue 
        in a statement just after her nomination on Oct. 3. "She has a reputation 
        of getting things done and her diverse experience at the state and 
        federal levels will be essential in guiding the court on an array of business 
        and other issues."

There are solid theoretical and empirical reasons to think Donohue is right that Miers may be able to guide the court on business issues.

In an article entitled How do Judges Maximize? (The Same Way Everybody Else Does -- Boundedly), 51 Emory Law Journal 83 (2002), my friend and former colleague Mitu Gulati and I adapted the tools of behavioral economics to the study of how judges make decisions.

We pointed out that judges are subject to multiple institutional constraints that encourage judges to find decision-making shortcuts. Cognitive power is a scarce resource, which the inexorable laws of economics tell us decision makers will seek to allocate efficiently (to the best of their ability). Consistent with that prediction, we cited evidence that actors attempt to minimize effort in the face of complexity and ambiguity.

The inherent cognitive limitations implied by bounded rationality are reinforced by significant institutional constraints providing further incentives for judges to minimize effort. That federal judges, at both the trial and circuit court levels, are under severe resource and expertise constraints is well-documented.

Finally, when deciding business cases, courts are often faced with hard, dry, and highly technical substantive law issues. Most judges and clerks arrive on the court with little expertise in business law. In addition, it is safe to assume that neither judges nor their clerks have much interest in developing substantial institutional expertise in this area after they arrive on the bench, nor much incentive to do so.

Taken together, these constraints give judges incentives to find ways of deciding business cases with minimal effort. An actor can economize limited cognitive resources in two ways. First, by adopting institutional governance structures designed to promote more efficient decision making. Second, by invoking heuristics; that is, heuristic problem solving processes. The former approach is the relevant one for present purposes.

Specialization is a rational response to bounded rationality-the expert in a field makes the most of his limited capacity to absorb and master information by limiting the amount of information that must be processed by limiting the breadth of the field in which he develops expertise. Supreme Court justices will therefore need to specialize, just as experts in other fields must do. Specializing in business law would not be rational. The psychic rewards of being a justice -- present day celebrity and historical fame -- are associated with decisions on great constitutional issues, not the minutiae of business law. As Harry Blackmun once put it:

        If one's in the doghouse with the Chief, he gets the crud. He gets the 
        tax cases and some of the Indian cases, which I like, but I've had a lot 
        of them.

When faced with the necessity of deciding business law issues, the justices and their clerks doubtless recognize that they lack the expertise necessary to decide such questions with confidence. As we've seen, they're unlikely to respond by developing the necessary expertise. At the same time, however, like all decision makers, but perhaps more so because of their high level of visibility, Supreme Court justices care about their reputation for competence.

As specialists in a different field, Supreme Court justices may be inclined to defer to specialists in this field. Just as specialization is a rational response to bounded rationality, so too is a non-expert's decision to defer to a recognized specialist. Recognizing that even a good decision maker is subject to the proverbial "act of God," the market for reputation evaluates decision makers by looking at both the outcome and the action before forming a judgment. If a bad outcome occurs, but the action was consistent with approved expert opinion, the hit to the decision maker's reputation is reduced. In effect, by deferring to specialists, a decision maker operating under conditions of bounded rationality is buying insurance against a bad outcome.

In a collegial, multi-actor setting members of the decision-making body likely will prefer to rely on internal specialists. Deferring to someone else makes one vulnerable. In this context, justices who opt for deference are entrusting their reputation to the specialist to whom they defer. Ordinarily, the resulting vulnerability creates agency costs and, as a result, mandates monitoring the specialist. If the deferring justices trust the specialist, however, they need not expend resources on monitoring. Trust arises out of two primary sources. "Affinity trust" exists ex ante. It is based mostly on shared values and is most likely to exist where there is ethnic or religious affinity. "Learned trust" arises out of repeat transactions in which the players prove consistently trustworthy. In a small but heterogeneous community, such as the Supreme Court, learned trust likely dominates. One will thus be more likely to defer to those who have earned one's trust, which is most likely to be a fellow justice perceived as having special expertise.

Within a multi-member deliberative body, the potential for log-rolling further encourages deference. A specialist in a given field is far more likely to have strong feelings about the outcome of a particular case than is a non-expert. By deferring to the specialist, the non-expert may win the specialist's vote in other cases as to which the non-expert has a stronger stake.

We tested this analysis by examining the widely shared assumption that Justice Lewis Powell, who was a widely respected business lawyer before he want onto the Supreme Court, received substantial deference from his colleagues in the business law area. Gulati and I looked at the proportion of important securities and corporate cases assigned to Powell during his tenure on the Court, using as a proxy for the importance of cases decided by the Court the opinions that found their way into the casebooks.

We found a dramatic dominance effect for Powell. In terms of total cases, Powell has sixty-one and only three other justices even make it into double figures (Blackmun (twenty-one), Marshall (nineteen), and Burger (eleven)). A similar skew is present in the per year entry rates. Powell has an average of four securities or corporate cases entering the casebooks per year. The next closest number is 1.25.

In other words, we were able to confirm that Powell's colleagues deferred to Powell when it came to technical business law issues, by allowing him to write the majority opinion for a disproportionately large number of the important business law cases decided during his tenure.

Powell likely will go down in history mainly for his business law opinions rather than his constitutional law decisions. True, he wrote some important constitutional law opinions, but nobody will ever list him as a leading constitutional light.

If Harriet Miers makes it to the Court, this analysis suggests that she is likely to get a certain amount of deference from her new colleagues on business law issues, which could become a substantial amount of deference if they come to trust her handling of these issues. She'll therefore be more likely to be able to command a majority on these issues and more likely to be assigned the task of writing these opinions. Like Powell, accordingly, this is where she has her best chance to make a mark.


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