Georgetown University Law Center

About: Georgetown University Law Center is a based out in . It is known for research contribution in the topics: Supreme court & Public health. The organization has 585 authors who have published 2488 publications receiving 36650 citations. The organization is also known as: Georgetown Law & GULC.

The Tenuous Case for Derivatives Clearinghouses

Abstract: Mandatory use of swaps clearinghouses represents the principal regulatory response to the systemic risk from credit derivatives. Scholars are divided on the merits of clearinghouses; some scholars see them as reducing systemic risk, others contend they increase it. The case for swaps clearinghouses comes down to two related propositions: (1) clearinghouses are better able to manage risk than dealer banks in the over-the-counter derivatives market, and (2) clearinghouses are better able to absorb risk than dealer banks. Both propositions are heavily dependent on the details of clearinghouse design, the structure of the clearinghouse market, and the manner of clearinghouse regulation. In theory, a well-designed clearinghouse boasts one significant advantage over dealer banks: capital. Clearinghouses can have deep capital structures, including callable capital from their members. Clearinghouses thus diffuse losses across their membership, thereby avoiding catastrophic losses to any single institution. If designed properly, a clearinghouse should be much more resilient to losses than an individual dealer bank. Clearinghouse owners, however, are likely to pursue lower capitalization, leaving it up to regulators to ensure sufficient capitalization. Clearinghouses potentially encourage greater risk taking — via underpricing and reduced capital — to gain market share and increase returns on equity. Therefore, because clearinghouses also concentrate risk, they can present a dangerous increase in systemic risk relative to dealer banks. Thus, the case for clearinghouses remains tenuous and ultimately dependent upon the still-to-be- determined particulars of their regulation.

A Decision Theory of Statutory Interpretation: Legislative History by the Rules

Abstract: We have a law of civil procedure, criminal procedure, and administrative procedure, but we have no law of legislative procedure. This failure has serious consequences in the field of statutory interpretation. Using simple rules garnered from Congress itself, this Article argues that those rules are capable of transforming the field of statutory interpretation. Addressing canonical cases in the field, from Holy Trinity to Bock Laundry, from Weber to Public Citizen, this article shows how cases studied by vast numbers of law students are made substantially more manageable, and in some cases quite simple, through knowledge of congressional procedure. No longer need legislative history always be a search for one’s friends.Call this a decision theory of statutory interpretation. This approach is based on how Congress does in fact make decisions and thus is a positive theory. Normatively, it has the advantage of privileging text without blinding judges either to relevant information or to their duty to implement Congress’s decisions, including Congress’s own decisionmaking methods. It may also have the side benefit of reducing legislative incentives to manipulate the rules or to engage in strategic behavior to induce particular statutory interpretations.

Affordable Care Act Litigation: The Supreme Court and the Future of Health Care Reform

Abstract: In Florida v. HHS, a lawsuit brought on behalf of 26 states challenging the constitutionality of the Patient Protection and Affordable Care Act (ACA), the Supreme Court will determine the future direction of health care reform in the United States. During the unprecedented 5-1/2 hours of oral arguments, the Court will hear 4 issues: the individual purchase mandate, severability, the Medicaid expansion and the Anti-Injunction Act. The states challenging the ACA maintain that the purchase mandate uniquely penalizes individuals for failing to purchase insurance. Uninsured individuals, however, rarely do nothing. Instead, they self-insure, rely on family, and cost-shift to hospitals, the insured, and tax payers. Because most uninsured people will eventually require uncompensated care, they impose costs on everyone through higher taxes and insurance premiums. Further, although the ACA’s mandate is unusual, it is not unprecedented. Mandatory worker contributions to Medicare, for example, are a compelled purchase of health insurance. The necessary and proper clause, which permits Congress to pass laws rationally related to the exercise of federal powers, may be the best argument in favor of the mandate because the mandate is necessary for the other insurance market reforms to work. If the Court were to strike down the mandate, it would then have to determine whether the mandate is severable from the rest of the ACA. Although the ACA did not explicitly state that if part of the act were deemed unconstitutional the rest would survive, most ACA reforms are severable because they are unrelated to the mandate, such as funding for public health and community health centers. The more difficult question is whether the mandate is so intertwined with the ACA’s still unimplemented market reforms that the Court must strike them down. The Court will also review the constitutionality of expanding Medicaid to all individuals with household incomes below 138% of the federal poverty level. The states argue that Medicaid expansion is unduly coercive because they could lose all Medicaid funding and not just the funding related to the expansion. The Court, however, is unlikely to uphold the coercion theory because state participation in Medicaid has always been optional and some states have openly discussed exercising their option to discontinue the program. Finally, the Court will hear technical arguments concerning the Anti-Injunction Act (AIA), which prohibits lawsuits “for the purpose of restraining the assessment or collection of any tax.” The Court is unlikely to invoke the AIA because neither the administration nor the states contend that it applies. The ACA will achieve near universal coverage, something that seemed unimaginable just a short time ago. Health reform envisages a social contract in which everyone shares the cost, recognizing that virtually everyone will become ill one day. The ACA and its individual mandate are not unjustified limits on freedom, but rather are vital to a decent society.

Accuracy, Optimality, and the Preponderance Standard

Abstract: Law-and-economics scholars have recently argued that the legal system should set burdens of proof on the basis of ex ante welfare considerations. In this Article, we reject this welfarist approach, showing that it relies on contested normative principles, raises legitimacy concerns, and is nearly impossible to implement in practice. As an alternative, we propose a decision-theory model that we constrain to account for core legal values and the practical limitations of the trial process. Specifically, we require that the burden of proof prioritize accuracy (truth) over welfare, and that it be capable of operating without knowledge of the base rates or prior probabilities of activities. The resulting optimization problem can be solved using a minimax approach, which minimizes the maximum probability of error faced by each of the parties, and remarkably, the minimax solution turns out to be precisely the preponderance-of-the-evidence standard currently imposed by courts. We thereby not only refute recent welfare theories about the burden of proof, but also provide a new theoretical justification for the traditional preponderance standard.