August 21, 2009
In the 1980’s, developer George Klein looked across Manhattan and had a vision. In the place of seediness and decay, he saw an opportunity. At that time, Times Square was a overrun by strip bars, adult movie theatres, and filthy hotels. But Mr. Klein envisioned four towers in grand, state-of-the-art style rising up, as a centerpiece of the rebirth of Times Square.
Unfortunately, after investing significant time and money in fostering this vision, and winning the city’s approval for the redevelopment, an unscrupulous competitor filed a stack of meritless lawsuits that held up construction. Tenants who had agreed to lease space in Mr. Klein’s new towers began backing out, one after another. In the thick of defending the lawsuits, Mr. Klein had to abandon his plans for the redevelopment.
Nevertheless, under other developers, the project moved forward. Pivotal in the redevelopment of Times Square was ridding the area of the seedy adult entertainment businesses that littered the area. To do so, the City Counsel amended its zoning laws to restrict adult establishments.
Was this decision arbitrary and groundless? A group of adult-establishment proprietors thought so. So the peep-show owners banded together and brought suit against the City claiming it had violated their freedom of expression civil rights.
Adult businesses often bring with them negative secondary effects, the New York State Court of Appeals found, including increased crime rates, depreciated property values and deteriorated community character. The Court had examined studies and surveys that had been used by the City Council as a basis for rezoning. Businesses in close proximity of adult establishments, from Indianapolis to Los Angeles to Chelsea, suffered from depressed real estate values, higher crime rates and greater difficulty finding tenants and buyers. (Stringfellow’s of New York, Ltd. v. City of New York, 91 N.Y.2d 382, 694 N.E.2d 407, 671 N.Y.S.2d 406 (1998).)
While some grizzled old rebels might pine away for their romanticized portraits of a gritty Times Square of the 1970‘s, these studies demonstrate that there may be a very strong business incentive to morality.
We might look for a parallel in the financial markets. Economists and brokers who encourage investment in “emerging” markets often concede that there does appear to be a higher risk in “developing” economies. More bluntly, many people are reluctant to invest in a country where the dictator can turn around one day and seize your entire investment in an act of pure whim unbounded by the rule of law.
Conversely, the premium that is placed on U.S. Treasury Bills and companies traded in America is the stability of the investment that owes in no small measure to the firm grounding in established rules designed to protect investors.
But more than just the patchwork of securities laws and regulatory mechanisms might be responsible for the robustness of the U.S. economy. We might suggest that a certain ideological component, or rather a moral dimension, can account for the continued trust and reliance that is placed on the United States as the free world’s premier middle-man.
We might take the recent credit crunch as an example. The financial crisis that cratered this nation’s economy, and pushed other world economies to the brink of failure, followed on the heels of a New York Supreme Court’s September 2, 2008 ruling, upholding the Governor’s order to recognize as valid all out-of-state same-sex marriages.
The very first upturn in the economy this year, approximately March 10, 2009, which was buttressed by a weeklong rally, followed the weekend after the California Supreme Court heard oral arguments regarding Proposition 8, and indicated from their questions that they would honor the law declaring marriage as the union of a man and a woman.
To put it in financial terms, there is a moral premium to be paid for investing in states where the citizens abide the rules of civilized society. The moral premium of such states is compromised when people forfeit their obligation to live in accord with traditional notions of human decency. A society that grows decadent and perverse reveals signs of its own decline and signals investors to seek to put their money elsewhere.
People who discard morality as a relic of an oppressive past take the defining message of the Bill of Rights to be that each person should be permitted to live by his own personal moral code without any judgment or limitation by others. But liberty is not an ends in itself. Liberty is a means towards building a robust society. A co-equal but unstated balance to liberty is stability, accountability and morality in law.
To illustrate, we might find the same reckless economic policy underlying the subprime crisis mirrored in the contemporary social policy counterpart, the movement for same-sex marriage. In the subprime crisis, a misplaced egalitarianism purported to make the benefits of home ownership available to all Americans, regardless of their income or credit standing. So too, advocates for homosexual marriage decried the injustice of denying the benefits of marriage to homosexuals.
Gone from the subprime lending was any real analysis of the viability of the mortgages. Gone from the same-sex marriage activism was a consideration of the viability of homosexuals to create families. Home-buyers and homosexuals in their unrestrained passion unleashed a spirit of self-righteous entitlement while they ignored any of the qualifications for the benefits they sought.
What transformed the greed of a bunch of spoiled pretenders into a full-blown catastrophe was self-serving, opportunistic bankers and politicians who jettisoned any sense of consequence in pursuit of their own personal gain.
In the social sphere, activists who push for maximum liberty and blindly invoke civil rights as if it were a magic word, hold outright contempt for the rule of law. For example, homosexual advocate groups publicly scolded President Obama after the U.S. Justice Department filed briefs in support of the Defense of Marriage Act. The Defense of Marriage Act basically says that the 40 states that have explicit laws on the books forbidding marriage between homosexuals should not be forced by the U.S. Constitution to give respect such marriages performed elsewhere.
Homosexual groups attacked the President for “defending an immoral law.” They shamed him to the point that the Administration authorized a feeble brief to be submitted that in essence claimed the U.S. Government has no real interest in guaranteeing procreation and child-rearing through the institution of marriage. In the eyes of homosexual groups, the law didn’t matter. The will of the people of the fifty states didn’t matter. Nothing mattered except their own sense of pride, and therefore the government should simply roll over and refuse to defend a law enacted by the Senators and Representatives of the Union.
To oversimplify perhaps: morality requires the ability to live one’s life according to a code. This requires discipline. The libertine who feels power at the ability to seize upon his every whim is in fact the lackey of his own passions which come and go like a passing breeze. Things which contribute to stability of society are good. Things which introduce randomness, arbitrariness and uncertainty are not good for society.
With the rule of law, comes accountability. When people know that those who flout the law will be punished, its good, both for the people who are scared off from breaking the law, and those who have confidence that the society is a fair one. With stability, comes trust, and with trust, cooperation. With cooperation, people can rely on others to provide goods and services in a stable fashion, leading to innovation, growth and new efficiencies in the market.
The opposite is also true. Where thieves go unpunished, and victims left distraught with no ability to be made whole, the level of cooperation in society takes a nose dive. People grow selfish and distrustful of others, for there is no reason to trust anyone else and no guarantee that others won’t steal from them.
At the time when the same-sex marriage advocates had their propaganda machines in full force, formerly credible news outlets and political figures suggested there was an “economic gain” to same-sex marriage. They cited projections of tourism, when homosexuals from around the country and globe would supposedly flock to the enlightened states to marry there and produce opulent weddings.
This argument makes about as much sense as the announcement of the country of Greece in 2006. According to Business Week, in order to meet the targeted benchmarks demanded by the EU, Greece announced it was going to be forced to include illegal and black-market activities such as drug-dealing and prostitution in their Gross Domestic Product.
The gag behind the Greek GDP (which was not a made up story) is the fact that you can’t have it both ways. You can’t have a government that takes credit for its illegal activities (not even in Switzerland anymore). A country that is unashamed of its own corruption mocks itself and signals its failure to carry out the business of managing the interests of its citizens.
Let’s take this time to consider how much we stand to gain by refusing give deference to those who would dismiss morality in the name of freedom or social progress. The power of mockers comes only from the failure of those around them to reject their foolishness. And hopefully, those out-of-work peep-show dancers and adult theatre owners might find themselves encouraged to find a new line of business.
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