Problems with lawyers or laws 

As someone who teaches at a law school, and sees his students go out into the world, I am predisposed to like law. When I practiced law at a big firm here in Washington, D.C., I enjoyed it and I felt like we helped our clients with their problems, more often than not.

But a lot of people out there don’t like lawyers, and think that the legal profession is harming the country. And I’m beginning to think that they might have a point.

The New York Times recently reported on the problems of an American entrepreneur in Greece. Though Greek political leaders desperately want new businesses to start up there, the barriers in terms of regulation and legal confusion are very high. The Times reports:

“Sitting in his office, Mr. Politopoulos took a long pull from a glass of his premium Vergina wheat beer and said it was absurd that he had to lobby Greek politicians to repeal a 19th-century law so that he could deliver the exports that Greece urgently needed.

“And, he said, his predicament was even worse than that: It was emblematic of the web of restrictions, monopolies and other distortions that have made many Greek companies uncompetitive, and pushed the country close to bankruptcy.

“[Greece] has one lawyer for every 250 people, compared with about one for 272 in the United States. The effect on Greek competitiveness could not be more pernicious.”

So America will have to churn out a few more lawyers to reach Greece’s ratio. But not that many more. A few readers of my blog even gleefully e-mailed me this passage as an illustration that America should have fewer lawyers.

But while America might be off if some of the smart people who go into law went into something more entrepreneurial, this may have things backwards. Is Greece’s problem really too many lawyers? Or is it too many laws?

In his 1990s book, “Demosclerosis: The Silent Killer of American Government,” Jonathan Rauch wrote about the tendency of special-interest laws to accumulate, adding complexity to, well, everything and making it much harder to do — or start — business. That certainly accounts for Mr. Politopoulos’ problems — he wants to sell herbal tea, but an obscure Greek law requires brewers to brew only beer. No tea.

As a lawyer, I can think of half a dozen ways around this, but that’s kind of the point. When laws are complex, there’s almost always a way to lawyer around them, but to do that you have to pay a lawyer to figure it out, and then you have to structure your business in a way that’s driven by the need to get around dumb and complex legal restrictions, rather than in a way that makes for an efficient business. But the demand for lawyers is a symptom of the problem, not the cause.

At least, that’s what I’ve always thought. But now my University of Tennessee colleague Ben Barton is making me think again. He’s got a new book out from Cambridge University Press, “The Lawyer-Judge Bias in the American Legal System,” and his thesis is that lawyers are not only a symptom of overly complex laws, but also their cause.

In particular, he notes that in America, pretty much all judges (except for a few justices of the peace and such) are lawyers. And, after examining the work of judges in a number of different areas, he concludes that judges systematically rule in ways that favor lawyers, and that makes the legal system more complex.

I think that we’re in pretty much the same situation as Greece: If we want the kind of economic growth it’s going to take to get us out of our current economic and indebtedness crisis, we’re going to have to drastically reduce the number of laws and regulations confronting new and existing businesses.

That’s hard to do piecemeal — hence the term “Demosclerosis.” In his book, “The Rise and Decline of Nations: Economic Growth, Stagflation, and Social Rigidities,” economist Mancur Olson noted that frequently it takes a war or a revolution to clear away enough regulatory and special-interest underbrush to allow for fresh economic growth.

But Olson also noted that America has shown a unique capacity for self-renewal, often managing to start afresh without the kind of traumatic cleansing required by other nations.

Perhaps we can do that again. Looking around, I’d say it’s about time. And if the end result is less work for lawyers, well, maybe some of those excellent minds can find something entrepreneurial to do instead.

Examiner contributor Glenn Harlan Reynolds is the proprietor of Instapundit.com and a law professor at the University of Tennessee in Knoxville.

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