Climate Change Hysteria and the Supreme Court: The Economic Impact of Global Warming on the U.S. and the Misguided Regulation of Greenhouse Gas Emissions under the Clean Air Act

In the spring of 2007, the U.S. Supreme Court ruled in Massachusetts v. EPA that the U.S. Environmental Protection Agency (EPA) must promulgate automobile tailpipe C02 emission standards under Section 202 of the Clean Air Act (CAA). American environmentalists hailed the Supreme Court's decision as an important victory in the battle to curb global warming. This article argues to the contrary that: 1) a large body of economic work demonstrates that the likely pattern of costs and benefits from climate change in the United States bears no resemblance to the pollution problems that Congress intended to deal with in the Clean Air Act, with moderate climate change predominantly benefiting, rather than harming, the U.S. -- so that that the Clean Air Act cannot reasonably be interpreted to cover greenhouse gas emissions; 2) By effectively forcing the EPA to regulate ghg emissions under a statute that was never intended to cover the very different problem of climate change, the Court has changed the policy status quo in a way that makes socially desirable federal climate change legislation less likely; and 3) given the global nature of the greenhouse gas emission problem, unilateral emission limits in the U.S. are likely to be worse than ineffective, in that they will likely have the perverse effect of lessening the incentive for latecomers to climate change regulation (such as China) to themselves take costly action to reduce such emissions. The article concludes by arguing that a sensible formulation of U.S. climate change policy would involve measures to respond both to the long-term threat to the U.S. and the short-term threat to developing countries. There are policy instruments appropriate to these goals: large increases in subsidies for research and development into clean coal and alternative fuels to respond to the long term threat to the U.S.; redirecting foreign aid to fund climate change adaptation in developing countries to respond to the short term threat to developing countries.

Should the Law Ignore Commercial Norms? A Comment on the Bernstein Conjuncture and Its Relevance for Contract Law Theory and Reform

Professor Bernstein\u27s study of the interaction between private law and norms in the cotton industry is the latest installment in her ongoing investigation into the relationship between law and norms in trades ranging from the diamond market to grain and feed markets. Her incredibly detailed and thorough exploration of private lawmaking and commercial norms - and their interaction - stands as one of the most significant contributions to contract and commercial law scholarship made in the last half-century. The cotton industry study upon which I focus in this Comment not only reports fascinating findings about dispute resolution practices, but also presents a number of intriguing and complementary theoretical insights into those practices. Bernstein\u27s empirical findings call into question some of the fundamental results in the economic analysis of contract law, such as the theory that expectation damages induce efficient breach of contract. Her central induction from her discoveries about cotton industry practices is that the best way for the law to encourage the development of extralegal norms of commercial reasonableness and the enforcement of those norms via commercial reputation may be, paradoxically, to make those norms irrelevant in formal dispute resolution. This hypothesis - which I dub the Bernstein Conjecture - suggests that the underlying methodological supposition in Article 2 of the Uniform Commercial Code - that the law should mirror or reflect actual commercial norms - may in fact be destructive of the very norms it seeks to incorporate. This is no small implication. For this reason, after beginning with a few methodological quibbles, the bulk of this Comment focuses on the Bernstein Conjecture. I first develop an informal but quite general analysis of the role of the law in deterring commercial opportunism, and I then focus more precisely on identifying the social and market context in which the Bernstein Conjecture is likely to hold

Opting In and Opting Out: Bargaining for Fiduciary Duties in Cooperative Ventures

After surveying the Perfect-Markets analysis in Section I of this Article, Section II explores some strategic implications of its central insight regarding the imperfection of fiduciary duty protection. At the same time, by focusing just on strategic effects due to asymmetric information, the results in Section II are very limited and do not provide the backbone for a positive theory of opting in and opting out of fiduciary duties. Section III outlines how such a theory might proceed by considering a number of complicating factors that are important in the Perfect-Markets analysis and that also enrich the strategic approach in Section II. Section IV then applies my positive theory to selected doctrinal issues raised by the paradigm cases I described above