Ilya Somin over at the Volokh Conspiracy discusses Justice Scalia’s comments that many of our best and brightest minds end up wasted in the practice of law. Somin notes one serious argument against this claim, specifically that high prices for legal services are indicative of the high demand for those services. I think that there are two things that need to be added: first, as a tangent, that Say’s Law applies here (supply creates its own demand) and second, that the market for legal services is huge and the market clearing price for legal services is often way to high for many consumers. This interview with Jay Moses of the Center for American Progress details some elements of the supply and demand for legal services amongst the poor; this article in McClatchy details, among other things, an 11 million jump in the number of people eligible for free legal services since 2007. And this piece of advocacy from Diller and Savner is rich in detailing the extent of current legal services. Diller and Savner interestingly suggest that subsidizing legal aid for the poor also increases the quality of democratic representation, since it reduces the search and transfer costs of information about that sector of the population, allowing politicians to be more informed about the policy preferences and needs of their constituency. In shorter, more precise language one could say that subsidizing legal services for low-income users has positive informational externalities that increase the quality of democratic government (a public good).
But the second half of Somin’s argument is all too true: we have way too many laws. I recall a statistic (in a Krugman editorial perhaps?) noting that the massive body of federal criminal law implies that over half the population are de facto felons. Certainly the most egregious example is the terminally useless War on Drugs but there are far more insidious examples; there are plenty of excessively broad laws and regulations that felonize trivial things like failing to appropriately label chemicals or animal parts.
Ducks and Economics 