July 10, 2012

The Supreme Court’s Other Bogus Ruling

Does lying serve a useful social purpose? Is it a protected form of speech?

The nonstop debate over the constitutionality of the Patient Protection and Affordable Care Act has regrettably drawn attention away from the Supreme Court’s 6–3 decision in United States v. Alvarez, which struck down the 2005 Stolen Valor Act (SVA) on First Amendment grounds. The operative provision of that statute reads:

FALSE CLAIMS ABOUT RECEIPT OF MILITARY DECORATIONS OR MEDALS. — Whoever falsely represents himself or herself, verbally or in writing, to have been awarded any decoration or medal authorized by Congress for the Armed Forces of the United States . . . shall be fined under this title, imprisoned not more than six months, or both.

The statute increases the maximum penalty for the offense to one year when the misrepresentation applies to the Medal of Honor.

 Epstein  
 Illustration by Barbara Kelley

The SVA was not passed on a whim. As Justice Samuel Alito noted in his dissent, in the run up to the bill’s passage, many individuals had falsely claimed to have received a Medal of Honor, listing that accolade in public places like the Veterans History Project and Who’s Who. The passage of the SVA was in response to a clear breakdown in the set of social norms against making false claims for personal advantage.

A quick look at the statute reveals some modest flaws in its drafting. Quite properly, the SVA applies only to false claims of receiving a military honor. But the statute does not require the claim made to be knowingly false, which is surely correct for criminal prosecutions. The omission in this case, however, counts for little, because it is hard to imagine that any person could make an innocent mistake about whether he or she has received the medal in question.

Beyond that, the SVA does not distinguish between serious public misrepresentations and casual remarks, like jokes made in the company of family and friends. These problems beset all laws of misrepresentation, which routinely make accommodations for them. It therefore makes sense to read in the knowledge requirement, knowing full well that it will not prove an obstacle to prosecution in any case. It makes equally good sense to impose a de minimis exception on the statute, also in line with the standard common law rules of interpretation.

Neither of these implied limitations apply to Xavier Alvarez. In his first public meeting as a member of the Three Valley Water District Board in southern California, Alvarez announced that “back in 1987, I was awarded the Congressional Medal of Honor,” which, to his own knowledge, was not true. Justice Kennedy, who wrote for four members of the Court (himself, Chief Justice Roberts, and Justices Ginsburg and Sotomayor) treated this as a “pathetic attempt” to gain much desired personal respect. He did not say whether the fraud was known to the audience or whether it might have made any impact on their views toward Alvarez. Instead, he launched into an extended exposition of modern First Amendment law, intending to explain why this deliberate lie should be immune from criminal prosecution.

Justices Breyer and Kagan were a bit more cautious in embracing the First Amendment claim, thinking that a more narrowly drafted statute might meet all First Amendment objections. Both positions were soundly, and correctly, rejected in a strong opinion by Justice Samuel Alito, who was joined by Justices Scalia and Thomas in the dissent.

Is All Speech “Free”?

As everyone knows, the First Amendment contains this broad generalization: “Congress shall make no law . . . abridging the freedom of speech.” Clearly Alvarez’s riff before the Water Board constitutes a form of speech. But does the First Amendment also say that all speech should be free, such that no form of it could ever be punished? Absolutely not. The correct reading of the First Amendment is that the freedom it protects must always be understood in light of a more general theory of freedom.

Individuals normally are free to act as they choose, but that hardly allows them to go around beating up other individuals in the exercise of their natural liberties. Rather, a general theory of freedom, which comes out of libertarian thought, always has this major caveat: People are free to act so long as their actions do not impinge on the like liberties of others.

In other words, freedom of action does not allow the use of unlimited force in a Hobbesian war of all against all. The basic utilitarian point is that all individuals are better off in a world that requires the universal renunciation of force by individuals. That position cannot be achieved by a set of voluntary contracts among individuals since the transaction costs of securing such an arrangement would be prohibitive. Any individual person who holds out from the collective solution would remain free to rampage at will. Accordingly, the notion of freedom is hemmed in by a powerful universal constraint against the use of force, which binds all persons in a political community.

Even though force is by far the largest threat to social stability, it is not the only one. The use of deliberate misrepresentation also poses a threat to social peace. That is understood in connection with defamation, itself a very old tort, where the defendant’s false words to a third person about the conduct or status of the plaintiff could easily lead to the loss of a job, a marriage, or an election, assuming that it does not lead an uncontrolled mob to lynch an innocent person.

So-called “counterspeech” is always available to rebut false statements. However, all too often, the truth cannot catch up with a lie—so some legal remedy must be supplied to redress what could otherwise prove to be a fatal imbalance. The concern with deliberate misrepresentations is not limited to defamation cases, but also embraces forms of deceit that may induce one person to part with his money or property. Once again, legal remedies are imposed in order to stop actions that are tantamount to theft, even though ordinary individuals have means of self-protection by being smart enough to avoid the con in the first place.

Our basic legal system, then, imposes as many limitations on speech as it does on action. Nothing in the First Amendment was intended to undo the common law protections against force and fraud. Rather, the First Amendment was meant to prevent the government from imposing either civil or criminal restrictions on true statements: e.g., that a political opponent has stolen from the public treasury or committed adultery, which the public should know in making its electoral choices.

Individual lawsuits cannot deter wrongful forms of action. The police patrol the streets to stop crime. Air pollution boards enjoin factories and automobile manufacturers from producing excessive emissions, and impose criminal sanctions on those who deliberately flout the law.

Similarly, public responses are needed when private remedies against false statements cannot meet the challenge of policing fraudulent behavior in mass markets, as with longstanding laws against false advertising. That cooperative relationship between public and private harm should protect the SVA against constitutional challenges, where, as in defamation cases, it is often difficult to trace down the particular third parties who were taken in by these misrepresentations, even though it is certain that such individuals exist. The criminal sanctions in the SVA are directed against precisely this sort of abuse. Given the limited devices to deal with innocent and trivial misrepresentations, there seems to be little to no likelihood that the SVA will trap unwary individuals in criminal law.

The Court’s Failure

The majority of the Supreme Court embraced this logic. Yet, the law was still struck down. The Court went astray for one simple reason. It failed to read the First Amendment in light of its libertarian roots. Instead, Justice Kennedy resorted to a different conceptual framework that starts with the proposition that “government has no power to restrict expression because of its message, its ideas, its subject matter.” Accordingly, we are told that the Constitution “demands that content-based restrictions on speech be presumed invalid” unless and until the government can justify those restrictions.

The Constitution “demands” no such thing. To be sure, with truthful speech, it is easy to see why content-based distinctions should be regarded with deep hostility. The ability to punish speakers who are for one position while giving a free pass to individuals who take the opposite position is an open invitation to favoritism by government, which could lead to the faulty operation of political, economic, and social activities. The government that cannot give financial support to one group at the expense of its rivals cannot conceal its subsidies by imposing content-based distinctions on individuals on one side of an issue, but not those on the other.

This proposition, however, carries no weight in the case of lies that have the power to distort the balance of power and influence in political, economic, and social markets. So long as private parties are entitled to redress against these forms of falsehood, there is no reason whatsoever to block the government from protecting our political and social institutions from individuals who consciously seek to lie for their own personal advantage.

Justice Kennedy tried to talk his way out of this situation by claiming that lies can serve useful social functions by eliciting spirited refutations. Justice Breyer added that the government could pass a statute narrower than the SVA to get rid of any of its unduly bad effects, without bothering to explain why any serious risk of overbreadth remains in the SVA once the common law rules on knowledge and de minimis statements are added into the mix.

The great flaw in our current First Amendment jurisprudence starts from its false premise that lies are really not that bad after all. Here, the Court became emboldened to strike down the SVA, which rests on a powerful intellectual pedigree.

The truth is, the Court’s constitutional jurisprudence has become increasingly incoherent. The root of the current constitutional malaise—which I have written about here and here—stems from the complete dissociation of constitutional law from ordinary theories of personal responsibility as developed by the common law. Hence, we find ourselves in an unhappy position. The government today is unable to cope with certain forms of admitted fraud. At the same time, it is not required to honor its most basic commercial and business imperatives, as its recent ruling on special assessments in Armour v. Indianapolis demonstrated. You cannot get results that bad by accident. It takes a deeply misguided constitutional worldview to get there—a worldview that is all too often practiced by a majority of the justices on the Supreme Court of the United States.


Richard A. Epstein, Peter and Kirsten Bedford Senior Fellow at the Hoover Institution, Laurence A. Tisch Professor of Law at New York University, and senior lecturer at the University of Chicago, researches and writes on a broad range of constitutional, economic, historical, and philosophical subjects. He has taught administrative law, antitrust law, communications law, constitutional law, corporate law, criminal law, employment discrimination law, environmental law, food and drug law, health law, labor law, Roman law, real estate development and finance, and individual and corporate taxation. His publications cover an equally broad range of topics. His most recent book, published in 2013, is The Classical Liberal Constitution: The Uncertain Quest for Limited Government (2013). He is a past editor of the Journal of Legal Studies (1981–91) and the Journal of Law and Economics (1991–2001).


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