Monday, March 31, 2008
George Miller (D-Calif.) Chair of the House Education & Labor Committee is shocked. "This report shows the extent to which credit card companies are using aggressive marketing tactics to take advantage of college students faced with increasing prices for tuition, textbooks, and other college-related expenses," Miller said a statement last week. Congress should make sure that students "are fully aware of their federal college loan borrowing options before turning to private loans and credit cards."
I wonder how Hon. Miller would react if he learned that credit card debt is dischargeable in bankruptcy but student loans are not. Shocked?
Sunday, March 30, 2008
It appears that more than just the cherry tree blossoms are growing in our nation's capital this weekend. The Bush Administration is set to release a plan on Monday that will grow the powers of the Federal Reserve to "serve as the system's overarching protector of stability." Admittedly, a little stability sounds like a good thing right now, but I am curious to hear exactly how Secretary Paulson proposes to achieve such stability. I also look forward to the play-by-play analysis by our very own Professor Reilly. It will be interesting in the decades to come to see how history will judge our reaction to this crisis. As Shakespeare said, "Wisely, and slow. They stumble that run fast."
Friday, March 28, 2008
If PSULaw presented a favorite movie night at the State Theatre, what would be our favorite law movie?
These are my nominees to get the project started:
A Few Good Men
I've seen this so many times I can recite most of the dialog. My favorite line? Demi Moore: "I object, I strenuously object. . . ."
My Cousin Vinnie
Yes, this is exactly what it feels like to pass from an ordinary person to a lawyer. My favorite line? Joe Pesci: "Oh, a counter-offer. That's what we lawyers - I'm a lawyer - we lawyers call that a counter-offer. This is a tough decision here. Get my ass kicked or collect $200. Let me think... I could use a good ass-kickin', I'll be very honest with you... nah, I think I'll just go with the two hundred."
Paul Newman is glorious as a lawyer who sees a big malpractice trial as the path to personal redemption.
May 1 is Law Day in which lawyers in America celebrate our heritage of liberty under law. If we can agree on a film, I'll see about getting the State Theatre for a PSULaw Law Day event. All you need to do is to add your nomination as a comment below.
Wednesday, March 26, 2008
Penn State Professor Philip Jenkins, Distinguished Professor of Religious Studies, will speak on his book "The New Anti-Catholicism: The Last Acceptable Prejudice" (2003 Oxford Press) on Thursday, March 27, 8-9:30 PM, 10 Sparks Building, UP.
Here's his thesis (quoting from the book):
"In the media, Catholicism is regarded as a perfectly legitimate target, the butt of harsh satire in numerous films and television programs that attack Catholic opinions, doctrines and individual leaders. Arguably, such depictions are legitimate expressions of free speech and stand within America's long tradition of quite savage satire, but the same tolerance of abuse does not apply when other targets are involved. It would be quite interesting to take a satirical or comic treatment featuring say, the Virgin Mary or Pope John Paul II and imagine the reaction if the same gross disrespect was applied, say to the image of Martin Luther King, Jr. or Matthew Shepard, the gay student who was murdered in Laramie, Wyoming in 1998. What sometimes seems to be limitless social tolerance in modern America has strict limits where the Catholic Church is concerned."
"Since the 1950's, changing cultural sensibilities have made it ever more difficult to recite once familiar American stereotypes about the great majority of ethnic or religious groups, while issues of gender and sexual orientation are treated with great sensitivity. At least in pubic discourse, a general sensitivity is required, so that a statement that could be regarded as misogynistic, or anti-Semitic, or homophobic could haunt a speaker for years, and could conceivably destroy a public career. Yet, there is one massive exception to this rule, namely, that it is still possible to make quite remarkably hostile or vituperative public statements about one major religious tradition, Roman Catholicism . . . ."
Tuesday, March 25, 2008
As a lover of the free market, I am watching recent events and asking myself, "When are bailouts appropriate? What are appropriate price tags on bailouts? How can we avoid the need for bailouts in the future?"
The latter question leads me to the conclusion, and I fully confess my limited understanding regarding such things, that there are at least two reasons we are seeing bailouts on various fronts right now:
1. We are so accustomed to pain avoidance and instant gratification that we cannot stand to pay the price for our own foolishness. I am suggesting that we are not willing to suffer a depression caused by our own bad behavior, but would rather continue to pop the pills (small and large attempts to fix here and there) that mask the side-effects of what is boiling beneath the surface.
2. Those in the free market have not thought generationally and have not passed along lessons from one generation to the next. As a result, each new generation manifests its greed and short-sightedness, leading us cyclically into these crises.
What is my response? INTEGRITY. If we had more integrity, we could avoid the need for bailouts.
1. If we had integrity, we would be willing to suffer for our mistakes. We would live for a while in the land of lack because we have been living in the land of plenty for years by borrowing from our tomorrows. Tomorrow is here. We have to pay the pied piper and get our debt levels down to a reasonable place. What we have is a debt problem. People are in debt, the gov't is in debt, and all because we have been living off of more than we make. That could all be fixed with a little integrity. If you make $60k, live like you make $60k, not $100k. If you get $2.4 trillion annually in tax revenues (Congress) don't live like you get $5 trillion. People with integrity don't try to be something they are not, they are real and honest. People with integrity don't turn away and point fingers. They face up to the pain when they caused the pain they are facing.
2. If those in the market would live outside of their own short-term gain and think long-term, they would train up the next generation of investors. We could learn from our mistakes. If those in the market acted with integrity (instead of trying to get away with schemes that seem too good to be true, but work for a period of time) we would not get in over our heads with such schemes. The market has to be bailed out when the market refuses to act with integrity. The investments made were not a bad idea in and of themselves, but the players allowed the system to develop such that there was no integrity linking up the initial investments with the end-receiver investments. Every man was in it for himself. The Free Market works, with integrity. If the free market refuses to act with integrity, the government will be "forced" to bail out, to regulate, and to reduce the sphere of free market activity. Over time, we may find ourselves in a society where the people welcomed increased and oppressive government control because of the free market's failure to act with integrity.
Integrity begins with you and me. Let's get started.
JPMorgan has provided $1 billion in financing in the form of a subordinated note at the primary credit rate plus 475 points (currently 7.25%) of any losses associated with the portfolio. ( It also guarantees Bear Stearns' existing debt to the NYFed). The LLC pledges the portfolio as security for $29 billion in ten year renewable term financing from the NYFed at current prime (2.5%). The NYFed secured loan is without recourse to JPMorgan. Any realized gains on the portfolio will accrue to the NYFed . Losses after the first $1 billion (which JPMorgan will bear under its subordinated note) will be the NYFed's. The NYFed's action is pursuant to its authority under section 13(3) of the Federal Reserve Act.
The restructuring of the JPMorgan/Bear Stearns deal was provided for in section 6.10 of the Merger Agreement. The Amended Guaranty Agreement and Amended Merger Agreement are here.
Read Prof. Gordon Smith's (BYU, Conglomerate) thinking about the JPMorgan guaranty, and the Deal Professor's (Steven Davidoff, Wayne State) analysis of the new terms.
Wednesday, March 19, 2008
Jesse Westbrook for Bloomberg.com reports that in a statement issued three days later, the day the Fed stepped up to the plate, the SEC reiterated that as of March 11 Bear Stears had "a substantial capital cushion.''
Then all hell broke loose.
"Beginning on that day  and increasingly throughout the week, lenders and customers  began to remove funds from the firm,'' the SEC said. "As a result, Bear Stearns' excess liquidity rapidly eroded.'' In other words, Bear Stearns experienced an old-fashioned run. Its clients wanted their money and its usual sources of liquidity wanted nothing to do with it.
Bear Stearns Chief Executive Officer Alan Schwartz blamed dirty rumors for triggering the run.
He said: "We have tried to confront and dispel these rumors and parse fact from fiction.'' But, that didn't work. Once the stink is in, it's in.
Where was the SEC? It was "working closely'' with the Fed and the Treasury Department to ensure "orderly and liquid markets.''
"Criticizing SEC examiners is unfair,'' said Robert Neff, a former Bear Stearns risk manager. "They've become every bit as strong and vigilant as the Fed. The SEC just doesn't have the ultimate power of the checkbook.''
Here's how the terms sheet describes the Fed's participation: Special Fed lending facility in place; non-recourse facility to manage up to $30B +/- of illiquid assets; largely mortgage related.
I wish I could write like that. Here's the dealio for realio: The Fed guaranteed around $30 million of debt to Bear Stearns on a non-recourse basis, meaning with no recourse to Bear Stearns if the debt is worthless. The total tab to the Fed will depend on how "illiquid" the "largely mortgage related assets" really are. Loren Steffy described the assets as a "toxic debt pool." The sun may come out tomorrow and if capital markets rebound, the debt may pay out, reducing or even reversing the Fed's exposure.
Is the Fed's guarantee a moral hazard-creating big government bailout? Or was it necessary to avoid an even bigger whollop to an already shaky capital market? As the media coverage attests, those are not yes/no questions. 'Bailout' is in the eye of the beholder.
Former Fed Chair, Paul Volcker added another question (LATimes blog, LALand):
Why is the Fed rescuing a non-bank [Bear Stearns -- really, Bear Stearns shareholders] that it does not regulate? Isn't that a job for Congress? Why is the Fed guaranteeing bad loans? The Fed regulates -- and lends to -- banks, not investment houses. . . . .
Volcker answers his own question: [T]he government ought to be taking responsibility for that kind of action, not the Federal Reserve, which is an independent agency designed to provide an ample supply of liquidity to the economy but not too much, protect against inflation, not to protect particular sectors of the economy from bad loans.
The Fed is fast-- way faster than Congress. It's fast because its shaded from the relentless glare of CNN cameras and November elections. No need for focus groups and subcommittee hearings. The Fed just does it. Here's what it had to say in a press release posted to its website on March 14:
The Federal Reserve is monitoring market developments closely and will continue to provide liquidity as necessary to promote the orderly functioning of the financial system. The Board voted unanimously to approve the arrangement announced by JPMorgan Chase and Bear Stearns this morning.
I hope to have some news of a North Dakota legal blog in the near future, and I hope you will check out my article coming out in the Energy Law Journal, "Changing Resources, Changing Market: The Impact of a National Renewable Portfolio Standard on the U.S. Energy Industry," which should be available sometime in April. Over the next few weeks, I plan to watch my alma mater Spartans tear through the South bracket on their way to a fifth Final Four under Coach Izzo, and I expect UND hockey to roll through the Final Five and then the Frozen Four. One can hope, anyway.
Thank you, again, for your hospitality and for allowing me to be a small part of Red Lion Reports.
In all the years I've taught this case as a companion to Cardozo's masterful Jacobs & Young v. Kent, a song runs through my head. I saw John Prine play this "when I was a young girl . . . ." This is the real lesson of Peevyhouse v. Garland Coal Company. Listen.
Tuesday, March 18, 2008
Basically, uncertainty as to tax results is an ever-present obstacle to many business transactions. Private insurance companies now provide an insurance product to protect the insured party against adverse tax consequences from proposed transactions. Ironically, this new insurance product, labeled "tax insurance," poses uncertain tax consequences itself. If the adverse tax consequences arise (that is, if the taxpayer has the additional tax liability) and the insurance company is required to cover that liability, are the insurance proceeds included in the insured's gross income?
Commentators have concluded that the proceeds are taxable. Insurance companies also appear to adopt that view as evidenced by the fact that tax insurance policies generally include gross-up provisions to cover the tax that might be imposed on the disbursement of the proceeds. Contrary to that general opinion, I argue that the tax insurance proceeds are not includible in the insured's gross income.
As part of the reasoning that underlies my conclusion concerning tax insurance, the article examines the tax treatment of general liability insurance. The proceeds of general liability insurance have not been treated as taxable when paid to satisfy a laibility of the insured. Some commentators have questions whether there is a policy justification for that treatment under tax policy. I address that question and develop an approach that provides a tax policy justification for excluding those proceeds from the insured's income.
The piece is still a draft so, if you have a chance to read it, any comments, suggestions or criticisms are welcome.
Monday, March 10, 2008
How is it that someone who spent so much time and effort pursuing fraud and corruption could put themselves in such a horrible situation? I know, I know: "Power tends to corrupt, and absolute power corrupts absolutely. Great men are almost always bad men."
Blah, blah, blah. Sometimes I think it is phrases like this that make some people think it is okay to act outrageously. Somehow acts that lead to grand downfalls are justified, in the mind of the actor, as the cost of (or reward for) pursuing greatness generally. Then again, maybe it is just this simple: people are fallible and the more high profile a person it is that falls, the more likely we are to learn about it. Some people are mostly good, and some people are mostly bad, and all of us have varying degrees of both qualities.
I had no illusions that Spitzer was perfect, or even necessarily a good person (I have never met the man), but I admit I am a bit surprised by the specific type of downfall. If nothing else, I thought he was smarter than that. I suppose, whether we mean to or not, we have a tendency to treat people, especially famous ones, as all good or all bad. And maybe that is really the issue. Instead of assuming that we know people from the halftime show on Monday Night Football (sidenote: this will always have a piece about Brett Favre) , Behind the Music, or 60 Minutes, we should start recognizing we know only a little bit about the featured personality.
We are all complex beings who cannot be figured out or summarized in a sound bite or snippet. At least, not until we do something really, really outrageous. Then, sometimes, and unfortunately, one simple word captures it all: Seriously?
Friday, March 7, 2008
Pennsylvania has a primary on April 22nd and, for once, it actually means something on the Democratic party side. (So much so that, much as occurred in Ohio, some residents are rushing to change their party affiliation to Democrat in time to vote.) To avoid a long and potentially harmful battle, both Clintons have suggested that Hillary is open to the possibility of a joint ticket. But would Obama agree to it?
The Clintons would, of course, prefer that Hillary be the top part of the ticket, with Obama as her vice president. But since Obama is currently leading (even if only marginally), I don't think it is likely that he will agree to such an arrangement at this point and he has now said so publicly.
So is there another deal that Hillary could offer Obama, one that benefits her and that he might accept? Perhaps Hillary could appeal to Obama's interest in having a real impact on the future of the country and offer him the first open seat on the Supreme Court. It is probably my lawyer bias, but I think that a person could have a much greater impact as a justice than as vice president (especially given the lifetime appointment - which, for Obama, could easily be 30-40 years). Of course, Obama could make the same offer to Hillary. While she is older than Obama, the position may still appeal to her.
Would either be enticed by such an offer? Weighing against accepting is the "historical first" consideration (which favors the president/vice-president option over the Supreme Court for both nominees). It may also depend on the way that the court will lean for the next 30 years. It might be fairly distressing to write 30 years of dissenting opinions (although some types relish that role). In the end, though, which deal would you take: justice or vice president?
Thursday, March 6, 2008
Read the rest of this post . . . .
I am enrolled in Jurisprudence this semester, and one idea we have explored is the possibility of humanity to act altruistically. Are we really completely self-interested, and hence motivated? I do not think so. Of course we have natural tendencies towards selfishness, but I believe there is goodness in each of us, and that we have the capacity to act in accord with that goodness. I believe this, because I have witnessed kindness and goodness in others. We all have roles to play at work and home, and within those roles, there will be natural obligations on our time. Yet, even with obligation, there are still professors who give time to mentor students and there are still friends who give time to counsel each other. A cynic may argue that an individual acts because he believes there is some benefit to him. Unfortunately, there may never be a satisfactory answer to the cynic, but for me, I choose to believe the motivation of others is altruistic.
In all seasons of life, we are blessed by individuals who, for whatever the reason, care for us and invest in us. In the church-calendar, we are still observing Lent. Whether you observe Lent formally or not, time for quiet contemplation and reflection are always good practice. In the midst of the demands on our time, the stressors of the semester and the difficulties of life, I am humbled to notice that I am not alone. I am grateful for the individuals in my life who model to me the goodness of the human spirit. Without them, my experiences and learning would be greatly diminished.
The artist of the painting imaged in this post said the following of his work:
We all remember a teacher from our childhood who gave us the gift of time and helped us when we needed it. As the years go by, we think of them and become aware of the precious gift they gave to us. We feel an emptiness inside because we want these teachers to know that they made a difference and that they affected our lives forever. But we never told them. My painting, A Gift of Time, is dedicated to all teachers who have given such a gift – my way of saying, “Thank you, thank you, thank you”. – Jim Daly
After less than two years of existence for Penn State Law School's University Park location, the intellectual life of the school is picking up steam. We are committed to building a tradition of intellectual curiosity and engagement. We recognize that we are starting from scratch but will do whatever it takes to establish a culture that we are proud to pass on to those who will follow. While space has been a challenge, I am proud of the efforts that have been made notwithstanding the challenges of transition.
This is largely thanks to everyone from students to faculty to administrators who are working hard to attract great legal minds to campus. This is only just the beginning but it's a foundation and tradition to establish for the future.
Professor Kahn posted about Prof. Brant Hellwig presenting on March 6, so I want to take a moment and list a few more that are in the days to come:
March 17 - Guest from Maastricht University presenting on International Human Rights [7 - 8 p.m. in 333 Beam and 254 Carlisle]
March 18 - Psychology of Torture: Examining the Ethics & Legal Dilemmas [5:45 - 7:45 p.m. Beam Library and 119 Carlisle]
March 19 - Steroids & Baseball - Where is the Public Interest? featuring pioneering reporters Mark Fainaru-Wada and Lance Williams [1:30 - 2:30 p.m. 319 Beam and 142 Carlisle and again from 7 - 9 p.m. 112 Kern and 119 Carlisle]
March 20 - Prof. Stephanos Bibas of Penn Law on "Orginalism and Formulism: Justice Scalia the Unlikely Friend of Criminal Defendants?" [12 - 1:30 p.m. 254 Carlisle]
March 21 - Prof. Preston Green of Penn State Law on Choice, Desegregation, and Funding: Courts and the Black Struggle with Equal Educational Opportunity [12:30 - 1:30 p.m. 333 Beam and 148 Carlisle]
March 26 - Prof. Brad Smith of Capital University Law School on Broken Windows and Voting Rights [7 - 8 p.m. 208 Ford and 119 Carlisle]
April 16 - Prof. John Baker of the Louisiana State University Law School on Federal v. Local Control of Law Enforcement [330 Beam and 119 Carlisle]
April 22 - Jeffrey Toobin, CNN contributor and author of "The Nine" [7 - 9 p.m. 110 Smeal Business Bldg. preceded by a wine and cheese social in the Smeal atrium]
Wednesday, March 5, 2008
Josh, I just report the news. Congress makes the Bankruptcy Code. The justification for shielding principal residence mortgage lenders from strip down in 11 U.S.C. 1322(b)(2)(chapter 13 debtors) and, 11 U.S.C. 1123(b)(5) (individuals in chapter 11 reorg.) is controversial. I've always understood it as a political response to the home mortgage lending industry. Lenders want payment stability to smooth risk and make home mortgage backed asset pools relatively more attractive than other asset backed securities. The asserted political payoff for this special treatment is a relatively lower cost of capital to home mortgage borrowers and ostensibly more Americans with access to home ownership.
Read the rest of this post . . . .
The right to strip down the principal balance on a home mortgage to its market value hasn't been terribly useful for debtors in rising real estate markets. Usually, a home mortgage borrower in bankruptcy wants to maintain his or her contract mortgage payments and cure any default in installments over the life of the plan (called "long term debt treatment" 11 U.S.C. 1322(b)(5)). To take advantage of a strip down, a debtor would have to pay off the stripped down principal balance in the three to five year term of a plan-- which, for 15 or 30 year mortgages would have the effect of jacking up monthly payments way above the cash capability of most debtors in bankruptcy. (I probably don't need to mention that it's only the rare debtor who uses a chapter 13 to strip down a mortgage on a vacation home. Typically, the vacation home is long gone before the debtor seeks relief.) The right to strip down or "modify" a home mortgage suddenly becomes important in times like these where home values are falling, in some places, dramatically.
As for the proposed amendment to the Bankruptcy Code to allow current borrowers to strip down their home mortgages in bankruptcy, I worry that retroactive application to loans already out there could increase instability in securities markets, making the capital crunch even worse. And that would be bad news for borrowers for sure.
Elizabeth Warren (Harvard) has posted a cogent criticism of the Bush Administration's response to the "mortgage crisis" on Credit Slips. And on the same blog, James White (Michigan) offers his view on proposed strip down legislation. Adam Levitin (Georgetown) and Joshua Goodman (Columbia, Econ.) have posted a working paper that purports to debunk the lending industry claim that permitting home mortgage strip down in bankruptcy would injure capital markets. For a detailed explanation of the ban on stripping home mortgages in bankruptcy, including commentary on the specific legislative proposals to reform it, read Mark Scarberry's (Pepperdine) testimony before the Senate last December.
Tuesday, March 4, 2008
Read the rest of this post . . . .
Bernanke thinks the path out of the housing crisis requires government action. In particular, government-sponsored mortgage finance enterprises, Fannie Mae and Freddie Mac, could do more to address problems in housing and mortgage markets. "New capital-raising by the (government-sponsored enterprises), together with congressional action to strengthen supervision of these companies, would allow Fannie and Freddie to expand significantly the number of new mortgages that they scrutinize," he said. "With few alternative mortgage channels today, such action would be highly beneficial to the economy." Bernanke didn't mention amending the Bankruptcy Code to permit homeowners unilaterally to strip down mortgages. For bankers, a government imposed haircut feels more like a scalping.
Read the rest of this post . . . .
The efforts Paulson and the Bush administration support is the voluntary consortium of lenders, the Hope Now Alliance, which has implemented a protocol for assisting borrowers refinance or restructure their home loans. The reports on how the Hope Now Alliance is doing in assisting homeowners facing foreclosure are mixed. In January 2008, Hope Now reported assisting homeowners in 167,000 loan workouts, up 11% from December 2007. During the same period, foreclosure starts increased by 5%. The problem which has Paulson and others stumped is the large number of homeowners (estimated 800,000) in danger of losing their homes to foreclosure that have failed to respond to overtures from Hope Now lenders. Paulson's view-- tough noogies. "If borrowers don't ask for help, they will have to bear the consequences."
Congressional Democrats assert that assistance for homeowners in refinancing their home loans is not enough and have proposed their own plans, including the Foreclosure Prevention Act of 2008 (S. 2636) which, among other things, would amend the Bankruptcy Code to permit homeowners to strip down the principal balance of their home mortgage to its current value in a bankruptcy case. Under current bankruptcy law, a debtor can "strip down" only mortgages for investment properties, vacation homes and farms, not principal residences. Lenders lobbied against the bill arguing that allowing strip down of home mortgages in bankruptcy would cause a rise in home mortgage rates unfairly borne by all mortgage borrowers. Senate Republicans blocked the bill last week. Paulson noted that proposals like these "would do more harm than good."
Home values are falling at record speed. The S&P Case/Shiller Home Price index showed its largest annual drop in its 20-year history, 9.1% in a single year (2007). By comparison, during the 1990-91 recession, home prices fell 2.8%.
Monday, March 3, 2008
Brant Hellwig, an associate professor at South Carolina University School of Law, will be visiting Penn State this Thursday, March 6, to present his paper, "Examining the Motivations Behind Nonqualified Deferred Compensation Plans." During his talk, Brant will review briefly what nonqualified plans are (as he notes in his materials, such plans are basically arrangements under which employees perform services for which they receive payment several years later than the year in which the services were performed) and address why employees are willing to accept such (generally unsecured) compensation packages.
Brant is one of the top "mid-level" (he began teaching in the fall of 2002) tax professors in the U.S. His many articles have been published in both tax and general law review journals (such as the Illinois Law Review, Minnesota Law Review, Florida Tax Review, Virginia Tax Review, Tax Notes, etc..)
Although I have not met Brant in person, I have read (and cited in my articles) much of his work and I always find it interesting and well-written. I am very much looking forward to his talk and will report again my thoughts on this particular piece after his presentation.
The Global Finance Center Index, released February 28, reports that London is the world's most competitive financial center. New York ranked second. Here's the breakdown after that: 3) Hong Kong; 4) Singapore; 5) Zurich; 6) Frankfurt; 7) Geneva; 8) Chicago; 9) Tokyo; and 10) Sydney. The report, commissioned by the City of London, noted that New York dominates all cities as to capitalization of listed companies and trading volume on its exchanges. And bankers rate New York higher than London. New York took it on the chin, though, on the affordability of office space, business confidence, and per some responders, Sarbanes Oxley regulation.
Saturday, March 1, 2008
When is taking something off your plate the best way to get more done? Almost always, it appears. The New York Times provides this article about Dr. Dan Ariely’s new book, “Predictably Irrational.” The book discusses the idea that most people can’t make difficult choices that will reduce their options, usually at the expense of maximizing their potential.
Dr. Ariely openly admits he is not above making some of the same mistakes. The article notes that when trying to decide between two job offers, it was quickly clear that “he and his family would be more or less equally happy in either place. But he dragged out the process for months because he became so obsessed with weighing the options.”
Personally, I see this all the time in my scholarship (and many other places, for that matter). I have a basic plan for what I want to complete in the next few years, but I have countless ideas for new articles and projects, many of which will never go beyond the initial illegible note to myself on a Target receipt. But those slips of paper pile up on my desk, and I usually resist starting one project before I review all my other ideas. Eventually, I do actually start writing, but the time spent on this endeavor is often time wasted and time lost.
Beyond largely personal decisions, Dr. Ariely’s thesis puts a fine point on a lot of difficult policy questions for educators, as well: Should we change the first-year curriculum? Should pro bono work be required to graduate? How do we better prepare our students for practice?
On a broader scale, too, his concept applies: What do we do next in Iraq? Should we cap greenhouse gas emissions? How do we get health care costs under control?
These are all difficult questions, and it is hard to take any options off the table, lest we miss the best option for solving the problem. However, doing nothing, under the guise of considering everything, is a decision, too. Moving forward, at a minimum, I am going to do my best to keep that in mind.