Implausibly, Freedom Gets a Boost

Every once in a while, the Supreme Court takes notice of the Constitution and actually comes to the defense of that thing called freedom. True, it doesn’t happen often, and hasn’t happened much at all for, oh, 100 years or so. But it can and does happen. This time, the issue concerns the relationship between commerce and religion, and freedom came out on top. We can work with this.

The backdrop is this… A small Lutheran school in Michigan (the Hosanna-Tabor Evangelical Lutheran Church and School) hired Cheryl Perich to teach many subjects, including theology. After a semester, she developed narcolepsy and said she couldn’t show up for work for a month after the Christmas break. The kids would just have to wait.

But in this competitive market, failing to deliver educational services could be financially devastating, not to mention very detrimental to the kids. So the school hired someone to take her place. When Perich finally showed up for work, she sensed that she had been replaced and prepared a disability lawsuit. The school tried to give her benefits in exchange for resigning, but she refused. So she was finally fired for insubordination and causing disruption.

It’s not a particularly unusual case. Businesses face this sort of thing all the time. The way the law works, businesses are routinely blackmailed by disgruntled employees who demand to be paid, even though they aren’t wanted. It’s beyond me why a person would want to work at a place where he or she is not wanted, but that’s the way it is. And the law, citing their “civil rights” to other people’s money, usually comes down on the side of the worker.

The EEOC decided in favor of the Perich, but the school persisted, and the case went to the high court. Here the justices delivered a surprisingly sensible decision on interesting grounds. The Constitution says that the government can’t interfere with religion. Perich was teaching religion at a religious institution. For the government to demand her reinstated, it would be a clear imposition on this institution and an obvious violation of the First Amendment.

“Requiring a church to accept or retain an unwanted minister, or punishing a church for failing to do so,” said the court, “intrudes upon more than a mere employment decision. Such action interferes with the internal governance of the church, depriving the church of control over the selection of those who will personify its beliefs. By imposing an unwanted minister, the state infringes the Free Exercise Clause, which protects a religious group’s right to shape its own faith and mission through its appointments.”

Darn right. But wait! What about her “civil rights”? The court said that whatever the employee’s legal rights would be in a normal commercial institution, they can’t possibly apply in the case of a commissioned minister of a religious institution. Otherwise, we would have the government effectively deciding who must or must not be a minister, which obviously contradicts the whole point of the First Amendment.

The language of both the majority and concurring opinions makes a series of uncommonly sensible points. The concurring opinion by Samuel Alito and Elena Kagan points out that it is part of Lutheran teaching that disputes be handled within the community and not be taken to secular courts. But this teacher, Perich, totally disregarded this core principle and immediately started threatening the school with a lawsuit.

Your eyes just pop out to read the court wholly endorsing the Lutheran view: “Hosanna-Tabor discharged the respondent because she threatened to file suit against the church in a civil court. This threat contravened the Lutheran doctrine that disputes among Christians should be resolved internally without resort to the civil court system and all the legal wrangling it entails.” For courts to interfere “would dangerously undermine the religious autonomy.”

Again, darn right.

But you know what the problem here is? The court wrapped its defense of freedom here in clerical robes only. In order to enjoy the autonomous right to hire and fire, you have to be a religious institution, and it has to pertain to someone who is teaching, however little, some aspect of doctrine. That’s the right decision, but why shouldn’t the same principle apply across the board to all commercial institutions and, indeed, to all private institutions? Why should religious institutions be the exclusive beneficiary of a laissez-faire policy?

All businesses, all nonprofits, all private clubs, all neighborhood associations have internal policies and should enjoy the right to manage their own affairs without government intrusion. To impose a government plan on their labor policies is a serious compromise of rights and liberties, which must always include not only the right to associate but to disassociate.

The critics of the case worry that the decision is too broad, so broad that the court didn’t even bother to define what a minister is. The critics are completely wrong. This court decision is the right one, but the problem is that it is too narrow: In the name of freedom, all privately owned groups should be granted the same right to manage themselves.

Interestingly, this case even has implications for the current political war over Mitt Romney’s activities at Bain & Co., a private equity firm that specializes in corporate restructuring. Its work can result in either profits or losses, expansions or closings. People are hired, people are fired. Who decides? The owners and managers do — in response to market trends — so it should be always and everywhere in a free society.

Newt Gingrich, apparently, doesn’t like this idea. He calls Romney a corporate raider who needlessly puts people out of work — as if Gingrich knows better than the stockholders how to run a company.

A particular issue for Gingrich concerns a steel mill in Kansas that Bain was instrumental in closing, leaving massive job losses behind. Hello? Steel? Its production was once integral to the U.S. economy, but those days ended some 30 years ago when overseas companies demonstrated that they could do the same thing at a fraction of the cost. Is Gingrich really suggesting that every means should be used to keep steel plants open, even if it means looting American businesses and consumers who are forced to pay the highest possible prices for no good reason?

This way of thinking puts Gingrich on the side of Cheryl Perich: against the rights of the property owners. Just as the Supreme Court said, such a system would involve massive coercion against people and intolerable intrusions into the private affairs of others.

Whether it is a tiny religious school or a multinational corporation, up with freedom of association and freedom of disassociation! That’s the way liberty works. Its genius is its capacity to adapt the economic environment to a changing world, so that we stay on the path of growth to support rising living standards for humanity. The stasis of a socialist, state-run economy is not an option in today’s world, and neither is the economic stagnation that comes with national protectionism and special privileges for workers. You can’t have genuine profit and expansion without the possibility of losses and plant closings, and without the owners of institutions having control over who can and cannot get paid for services.

What applies to the Lutheran school should apply to every sector of society that is privately owned, whether or not their workers are called ministers. It is not only religion that needs protection against government interference. Everyone does. Granted, this would be a gigantic step in the right direction.


Jeffrey Tucker

The Daily Reckoning