RICO Illustrates One Way Leviathan Grows
Like many other laws if not most laws, the Racketeer Influenced and Corrupt Organizations Act (RICO) has been used for purposes far different from its professed original goal. Like other ways in which the state tends to grow into Leviathan, this is not a random event or a manifestation of the supposed “law of unintended consequences.”
On RICO, the Wall Street Journal just wrote (“Federal Prosecutors Are Using a Law Intended for the Mob in Unexpected Cases,” December 26, 2021):
Federal prosecutors around the country are increasingly using racketeering statutes to go after a broader array of criminal activity, applying them in ways that deviate from the law’s original goal of dismantling organized crime. …
The law, passed in 1970, was used successfully early on to target the leaders of New York’s five organized crime families. Since then, it has been used effectively to target insider trading, market manipulation and cybercrime, even where defendants in some cases had never met each other.
Authorities in Boston pursued RICO charges in a nationwide college admissions cheating scheme …
In the trials of Messrs. Raniere and Kelly, viewed by lawyers as novel applications of the RICO statute, both men were accused of leading a criminal enterprise and using their inner circles to engage in illegal activity and recruit women and girls for sex. …
[Mr. Raniere’s lawyer] said that the women freely chose to participate in sex acts. …
Steve Greenberg, Mr. Kelly’s former attorney, said it was an abuse of the law to call Mr. Kelly’s lifestyle and career a “criminal enterprise.” …
“Prosecutors basically said his life was an enterprise,” said Mr. Greenberg. “If they could have, they would have criminalized his going to the bathroom.”
That the power of the state tends to grow automatically has been a reason why classical liberals and libertarians thought it was essential to impose strict restrictions on government scope and power.
But how does the state act like Leviathan—that is, like a power-hungry state? A state or government is not a single person but an assemblage of political units and bureaucracies. How can all these components more or less consistently act to increase the general power of government? This is a valid question, and the answer has much to do with the structure of incentives in a government organization.
Anyone who benefits from an influential participation in the governmental machine has the incentive of choosing, in his daily activities, the alternatives that increase government power. Provided that they keep from openly violating the constitution or other fundamental laws, such a person is unlikely to be blamed for increasing the capacity of government but, on the contrary, is likely to be rewarded with a higher salary, better perks, and more power. Think of the bureaucrat who finds new missions for his bureau or the politician who makes promises or lies that the voters will have forgotten by the next election. Much of public choice economics has been devoted to analyzing these incentives.
Why would a politician oppose expansive laws that may eventually be useful in enforcing his own preferred bans and mandates, and which his supporters think will never be used against them? Why would bureaucrats oppose laws that will expand their bureaus and the glorious power for which they work?
Exceptions exist, often thanks to countervailing incentives. If they are not removable, judges constitute the major class of exceptions, even if they often fall under the spell of power. In the 2020 American election, they as well as a large number of humble local election officials stood against Trump’s self-interested lies. They were supported by “opinion” in the Hayekian sense but the question is whether we can rely on this dike as opinion seems to be drifting farther towards glorified state power if not towards callous demagogues. The failure of judges to constitutionally challenge laws such as RICO illustrates the current perils.
Outside of criminal laws proper, another major way through which Leviathan grows is by welcoming and even encouraging calls for assistance, which leads to increasing requests, further growth in state capacity, and snowballing dependence on government. Politicians and bureaucrats benefit. An interesting model is due to Anthony de Jasay, who showed how political competition to help people, including those harmed or disadvantaged by privileges granted to others, may eventually result in the state limiting political competition and taking in charge everybody’s lives up to a plantation type of state. Most classical liberals had milder but analogous fears. For example, in the first volume of Law, Legislation, and Liberty (University of Chicago Press, 1973), Friedrich Hayek wrote:
Since [the legislative assembly] possesses authority to arrange everything, it cannot refuse responsibility for anything. There will be no particular grievance which it will not be regarded as capable of removing; and since in every particular instance taken by itself it will generally be capable of remedying such a grievance, it will be assumed that it can remove all grievances at the same time. However, it is a fact that most of the grievances of particular individuals or groups can be removed only by measures which create new grievances elsewhere.
As I am writing this post, another title on the front page of the online Wall Street Journal reads “As Omicron Spreads, Governments Race to Ease Staff Shortages” (December 27, 2021). The state is also expected to keep inflation in check while distributing trillions of dollars, to assist all identity groups, to dispense “social justice,” to reduce polarization, to be a Green Giant, and to make everybody happy.