No author, no law

Something very odd has occurred in connection with the atrociously named “cromnibus” bill passed by Congress this weekend — a bill that the president, if only he might repent of the position he has taken to now, still both can and ought to veto. I refer to a peculiar new form of consent-evasion employed by one or more of the stealth drafters of the bill.

The consent-evasion I have in mind takes the form of several profoundly contentious and budget-irrelevant provisions smuggled into bill both at the last minute and without attribution — provisions that remain, as it happens, still unattributed. Probably the most troubling of the provisions in question is that which repeals Section 716 of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 — the so-called “derivatives push-out” provision.

{mosads}Dodd-Frank’s derivatives push-out provision has a very simple structure and an essentially incontestable purpose. It requires that when large financial conglomerates wish to engage in inherently risky derivatives trading in pursuit of potential profits, they do so through subsidiaries that are kept legally separate from federally insured depository institutions likewise owned by those conglomerates. In effect, it is a “firewall” requirement — a time-honored means, where financial regulation is concerned, of maintaining the safety and soundness of financial institutions whose services are used by ordinary rather than high-flyer Americans.

The reason behind Dodd-Frank’s rendition of this common requirement is straightforward: If Wall Street conglomerates are able to use our bank deposits — which are meant to be kept safe — in addition to their own money to gamble on speculative derivative instruments, then (a) there will be much more gambling of precisely the kind that brought us the 2008 crash; and (b) we taxpayers, rather than Wall Street, will cover the losses that the next crash occasions. We will, in other words, be bailing out Wall Street all over again — socializing losses even as Wall Street continues to privatize gains for itself.

This is, of course, perfectly disgusting. But what is yet worse is that no one will “own” it — presumably because it is so disgusting. We still do not know who inserted the provision, nor do we know why. All that we know is that whoever did it did it both (a) surreptitiously, apparently in hopes no one would notice, and (b) at the last minute, in connection with a continuing resolution cum omnibus spending bill, apparently in hopes of holding continued government operation itself hostage to the provision’s getting through.

Perhaps I am overreacting, but it seems to me that the way in which this provision has found its way into the cromnibus legislation is deeply subversive of our democracy. The aim, after all, is apparently both (a) to circumvent what would otherwise be a necessary agreement secured both transparently and free of budgetary time pressure, and (b) to render the party or parties whose consent is thus circumvented unaware of the guilt or identity of the guilty party.

This is precisely what has happened in the case of the cromnibus bill. First, the disgusting measures were slipped in surreptitiously late in the game when there was little time left from the time they were apt to be discovered to the time that decisions had to be made simply in order to keep the government running. And second, the measures continue to go unattributed, leaving no one to be held accountable.

What is the remedy when deliberative democratic decision-making is thus subverted? It seems to me there are two: one particular to the present bill, the other one general to all future such bills. As to the first, now that both houses of Congress have passed the bill with large numbers of Democrats and Republicans alike voting against, our only remaining hope is that the president thinks better of his earlier lobbying efforts on behalf of the bill and to now veto it. It would have been better, of course, had he shown the courage of conviction last week, but this week will be better than none.

As to the second remedy, I propose some such rule as the following: Any time a provision turns up in a bill as if out of nowhere, with no one prepared to claim credit or blame for it, the provision should be viewed in effect as a typo, and deleted accordingly. Where there is no author, there is no law.

The rule I propose bears an obvious intuitive appeal. It is also anything but unprecedented as a matter of law. In fact it is quite common, in the law, to regard words or punctuation marks that do not make sense in their contexts as what are called “scrivener’s errors,” and to interpret them out of the documents in which they have mysteriously appeared.

What I am proposing is much the same thing. For in a democratic polity in which we make our own laws through our own representatives, a legislative provision un-authored by any legislator is, as it were, democratically senseless. It is neither intelligible nor, therefore, cognizable as a democratically legislative act. It is the statutory-drafting equivalent of a UFO, and must accordingly be expunged until authored by a bona fide legislator.

Let us all hope and insist, then, both that the president comes to his senses and vetoes the criminal cromnibus bill, and that the Congress in future treats all un-authored legislative provisions as the extralegal barnacles that they are — and scrapes them right off.

Hockett, a regular contributor, is Edward Cornell Professor of Law at the Cornell Law School and a fellow of the Century Foundation.

Tags Cromnibus Dodd-Frank financial reform
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