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Plain meaning

June 26th, 2015

In its reporting on yesterday’s Supreme Court ruling in King v. Burwell, Vox’s Matthew Yglesias makes the important point that Justice Scalia’s dissent is based on a profound misunderstanding of how language works. Justice Scalia would have it that “words no longer have meaning if an Exchange that is not established by a State is ‘established by the state.’” The Justice is implicitly appealing to a “plain meaning” view of legislation: courts should just take the plain meaning of a law and not interpret it.

If only that were possible. If you think there’s such a thing as acquiring the “plain meaning” of a text without performing any interpretive inference, you don’t understand how language works. It’s the same mistake that fundamentalists make when they talk about looking to the plain meaning of the Bible. (And which Bible would that be anyway? The King James Version? Translation requires the same kind of inferential process – arguably the same actual process – as extracting meaning through reading.)

Yglesias describes “What Justice Scalia’s King v. Burwell dissent gets wrong about words and meaning” this way:

Individual stringz of letterz r efforts to express meaningful propositions in an intelligible way. To succeed at this mission does not require the youse of any particular rite series of words and, in fact, a sntnce fll of gibberish cn B prfctly comprehensible and meaningful 2 an intelligent reader. To understand a phrse or paragraf or an entire txt rekwires the use of human understanding and contextual infrmation not just a dctionry.

The jokey orthography aside, this observation that understanding the meaning of linguistic utterances requires the application of knowledge and inference is completely uncontroversial to your average linguist. Too bad Supreme Court justices don’t defer to linguists on how language works.

Let’s take a simple example, the original “Winograd sentences” from back in 1973:

  1. The city councilmen refused the demonstrators a permit because they feared violence.
  2. The city councilmen refused the demonstrators a permit because they advocated violence.

To understand these sentences, to recover their “plain meaning”, requires resolving to whom the pronoun ‘they’ refers. Is it the city councilmen or the demonstrators? Clearly, it is the former in sentence (1) and the latter in sentence (2). How do you know, given that the two sentences differ only in the single word alternation ‘feared’/‘advocated’? The recovery of this single aspect of the “plain meaning” of the sentence requires an understanding of how governmental organizations work, how activists pursue their goals, likely public reactions to various contingent behaviors, and the like, along with application of all that knowledge through plausible inference. The Patient Protection and Affordable Care Act (PPACA) has by my (computer-aided) count some 479 occurrences of pronouns in nominative, accusative, or possessive. Each one of these requires the identification of its antecedent, with all the reasoning that implies, to get its “plain meaning”.

Examining the actual textual subject of controversy in the PPACA demonstrates the same issue. The phrase in question is “established by the state”. The American Heritage Dictionary provides six senses and nine subsenses for the transitive verb ‘establish’, of which (by my lights) sense 1a is appropriate for interpreting the PPACA: “To cause (an institution, for example) to come into existence or begin operating.” An alternative reading might, however, be sense 4: “To introduce and put (a law, for example) into force.” The choice of which sense is appropriate requires some reasoning of course about the context in which it was used, the denotata of the subject and object of the verb for instance. If one concludes that sense 1a was intended, then the Supreme Court’s decision is presumably correct, since a state’s formal relegation to the federal government the role of running the exchange is an act of “causing to come into existence”, although perhaps not an act of “introducing and putting into force”. (Or further explication of the notions of “causing” or “introducing” might be necessary to decide the matter.) If the latter sense 4 were intended, then perhaps the Supreme Court was wrong in its recent decision. The important point is this: There is no possibility of deferring to the “plain meaning” on the issue; one must reason about the intentions of the authors to acquire even the literal meaning of the text. This process is exactly what Chief Justice Roberts undertakes in his opinion. Justice Scalia’s view, that plain meaning is somehow available without recourse to the use of knowledge and reasoning, is unfounded even in the simplest of cases.

Cover of Rousseau's Social Contract
…a social contract…

Title page of the first octavo edition of Rousseau’s Social Contract

[This post is based loosely on my comments on a panel on 2 April 2014 for Terry Fisher‘s CopyrightX course. Thanks to Terry for inviting me to participate and provoking this piece, and to my Berkman colleagues for their wonderful contributions to the panel session.]

Copyright is part of a social contract: You the author get a monopoly to exploit rights for a while in return for us the public gaining “the progress of Science and the Useful Arts”. The idea is that the direct financial benefit of exploiting those rights provides incentive for the author to create.

But this foundation for copyright ignores the fact that there are certain areas of creative expression in which direct financial benefit is not an incentive to create: in particular, academia. It’s not that academics who create and publish their research don’t need incentives, even financial incentives, to do so. Rather, the financial incentives are indirect. They receive no direct payment for the articles that they publish describing their research. They benefit instead from the personal uplift of contributing to human knowledge and seeing that knowledge advance science and the useful arts. Plus, their careers depend on the impact of their research, which is a result of its being widely read; it’s not all altruism.

In such cases, a different social contract can be in force without reducing creative expression. When the public underwrites the research that academics do – through direct research grants for instance – they can require in return that the research results must be made available to the public, without allowing for the limited period of exclusive exploitation. This is one of the arguments for the idea of open access to the scholarly literature. You see it in the Alliance for Taxpayer Access slogan “barrier-free access to taxpayer-funded research” and the White House statement that “The Obama Administration agrees that citizens deserve easy access to the results of research their tax dollars have paid for.” It is implemented in the NIH public access policy, requiring all articles funded by NIH grants to be made openly available through the PubMed Central website, where millions of visitors access millions of articles each week.

But here’s my point, one that is underappreciated even among open access supporters. The penetration of the notion of “taxpayer-funded research”, of “research their tax dollars have paid for”, is far greater than you might think. Yes, it includes research paid for by the $30 billion invested by the NIH each year, and the $7 billion research funded by the NSF, and the $150 million funded by the NEH. But all university research benefits from the social contract with taxpayers that makes universities tax-exempt.1

The Association of American Universities makes clear this social contract:

The educational purposes of universities and colleges – teaching, research, and public service – have been recognized in federal law as critical to the well-being of our democratic society. Higher education institutions are in turn exempted from income tax so they can make the most of their revenues…. Because of their tax exemption, universities and colleges are able to use more resources than would otherwise be available to fund: academic programs, student financial aid, research, public extension activities, and their overall operations.

It’s difficult to estimate the size of this form of support to universities. The best estimate I’ve seen puts it at something like $50 billion per year for the income tax exemption. That’s more than the NIH, NSF, and (hardly worth mentioning) the NEH put together. It’s on par with the total non-defense federal R&D funding.

And it’s not just exemption from income tax that universities benefit from. They also are exempt from property taxes for their campuses. Their contributors are exempt from tax for their charitable contributions to the university, which results ceteris paribus in larger donations. Their students are exempt from taxes on educational expenses. They receive government funding for scholarships, freeing up funds for research. Constructing an estimate of the total benefit to universities from all these sources is daunting. One study places the total value of all direct tax exemptions, federal, state, and local, for a single university, Northeastern University, at $97 million, accounting for well over half of all government support to the university. (Even this doesn’t count several of the items noted above.)

All university research, not just the grant-funded research, benefits from the taxpayer underwriting implicit in the tax exemption social contract. It would make sense then, in return, for taxpayers to require open access to all university research in return for continued tax-exempt status. Copyright is the citizenry paying authors with a monopoly in return for social benefit. But where the citizenry pays authors through some other mechanism, like $50 billion worth of tax exemption, it’s not a foregone conclusion that we should pay with the monopoly too.

Some people point out that just because the government funds something doesn’t mean that the public gets a free right of access. Indeed, the government funds various things that the public doesn’t get access to, or at least, not free access. The American Publisher’s Association points out, for instance, that although taxpayers pay for the national park system “they still have to pay a fee if they want to go in, and certainly if they want to camp.” On the other hand, you don’t pay when the fire department puts out a fire in your house, or to access the National Weather Service forecasts. It seems that the social contract is up for negotiation.

And that’s just the point. The social contract needs to be designed, and designed keeping in mind the properties of the goods being provided and the sustainability of the arrangement. In particular, funding of the contract can come from taxpayers or users or a combination of both. In the case of national parks, access to real estate is an inherently limited resource, and the benefit of access redounds primarily to the user (the visitor), so getting some of the income from visitors puts in place a reasonable market-based constraint.

Information goods are different. First, the benefits of access to information redound widely. Information begets information: researchers build on it, journalists report on it, products are based on it. The openness of NWS data means that farms can generate greater yields to benefit everyone (one part of the fourth of six goals in the NWS Strategic Plan). The openness of MBTA transit data means that a company can provide me with an iPhone app to tell me when my bus will arrive at my stop. Second, access to information is not an inherently limited resource. As Jefferson said, “He who receives an idea from me, receives instruction himself without lessening mine.” If access is to be restricted, it must be done artificially, through legal strictures or technological measures. The marginal cost of providing access to an academic article is, for all intents and purposes, zero. Thus, it makes more sense for the social contract around distributing research results to be funded exclusively from the taxpayer side rather than the user side, that is, funding agencies requiring completely free and open access for the articles they fund, and paying to underwrite the manifest costs of that access. (I’ve written in the past about the best way for funding agencies to organize that payment.)

It turns out that we, the public, are underwriting directly and indirectly every research article that our universities generate. Let’s think about what the social contract should provide us in return. Blind application of the copyright social contract would not be the likely outcome.

  1. Underappreciated by many, but as usual, not by Peter Suber, who anticipated this argument, for instance, in his seminal book Open Access:

    All scholarly journals (toll access and OA) benefit from public subsidies. Most scientific research is funded by public agencies using public money, conducted and written up by researchers working at public institutions and paid with public money, and then peer-reviewed by faculty at public institutions and paid with public money. Even when researchers and peer reviewers work at private universities, their institutions are subsidized by publicly funded tax exemptions and tax-deductible donations. Most toll-access journal subscriptions are purchased by public institutions and paid with taxpayer money. [Emphasis added.]


Medical loss ratio versus year for Medicare and private insurers
…in the upper 90’s…
apparently from Health Care for America Now! via

The Patient Protection and Affordable Care Act (ACA) limits the “medical loss ratio” (MLR) that an insurer can have — the percentage of collected medical premiums that must go to medical services for the insured. The minimum MLR mandated by the law is 80-85% depending on the particular market. (For simplicity, let’s call it 80%.)

On its face, this seems like a good idea. If an insurer’s MLR is really low, say 50%, they’re keeping an awful lot of money for administration and profit, and it looks like the premium-payers are getting a raw deal. By limiting MLR to at least 80%, premium-payers are guaranteed that at most 20% of their money will go to those costs that benefit them not at all. But there may be unintended consequences of the MLR limit, and alternatives to achieving its goal.

Because of the MLR limit, an insurance company that spends $1,000,000 on medical services can generate at most $250,000 in profit. They’d reach this limit by charging premiums totalling $1,250,000, yielding an MLR of 1,000,000/1,250,000 = .80. (Of course, they’d generate even less profit than this, since they have other costs than medical services, but $250,000 is an upper bound on their profit.) They can’t increase their profit by charging higher premiums alone, since this would just blow the MLR limit. The only way to increase the profits (governed by the denominator in the MLR calculation) is to increase medical services (the numerator) as well — pay for more doctor visits, longer stays, more tests, just the kinds of things we’re already spending too much on with our moral-hazard–infested medical care system. The MLR limit embeds an incentive for insurance companies to push for more medical services, whether needed or not.

And why 80%? Medicare has had an MLR in the upper 90%’s for a couple of decades, and private insurers used to make a go of it in that range as well in the early 1990’s. (See graph.) Other countries have MLR’s in the mid-90’s as well. An MLR limit of 80% means that once an insurer reaches 80% MLR, the regulation drops any incentive to improve further.

Wasn’t this moral hazard and inefficiency just the sort of thing the ACA was supposed to resolve by using market forces? When people buy insurance premiums on a transparently priced exchange, if one insurer is less efficient or egregious in profit-taking (therefore with a low MLR), it should end up outcompeted by more efficient and leaner insurers. No need to mandate a limit; the market will solve the problem.

If you think that the market forces in the health care exchanges won’t compete down adminstrative overheads and profits (that is, raise MLR) on their own and that regulation is necessary to prevent abuse, then you’re pretty much conceding that the market doesn’t work under the ACA, and that we should move to a single-payer system. MLR limits are not a way of achieving a more efficient insurance system but rather an admission that our insurance system is inherently broken. The MLR limit looks to me like a crisis of faith in the free market. What am I missing?

Update March 25, 2019: Wesley Pegden, Ariel D. Procaccia, and Dingli Yu have an elegant working out of the proposal below that they call “I cut, you freeze.” Pegden and Procaccia describe it in a Washington Post opinion piece.

'Halves' by flickr user Julie Remizova
…how to split a cupcake…
Halves” image by flickr user Julie Remizova.

Why is gerrymandering even possible in a country with a constitutional right to equal protection?:

No State shall make or enforce any law which shall…deny to any person within its jurisdiction the equal protection of the laws.

By reshaping districts to eliminate the voting power of particular individuals, as modern district mapping software allows, some persons are being denied equal protection, I’d have thought. And so have certain Supreme Court justices.

It’s hard to know what to do about the problem. Appeals to fairness aren’t particularly helpful, since who decides what’s fair? It would be nice to think that requirements of “compact districts of contiguous territory” (as Chief Justice Harlan put it) would be sufficient. But this reduces the problem of districting to a mathematical optimization problem; James Case proposes something like minimum isoperimetric quotient tessellation of a polygon. But such purely mathematical approaches may yield results that violate our intuitions about what is fair. They ignore other criteria, such as “natural or historical boundary lines”, determined for instance by geographical features like rivers and mountains or shared community interests. These boundaries may not coincide with the mathematical optima, so any mathematical formulation would need to be defeasible to take into account such features. This leads us right back to how to decide in which cases the mathematical formulation should be adjusted: who should decide what is fair?

A comment at a ProPublica article about gerrymandering from “damien” caught my attention as a nice way out of this quandary. In essence, he proposes that the parties themselves choose what’s fair.

The first solution to gerrymandering is to have a fitness measure for a proposed districting (e.g. the sum of the perimeters), and then to allow any individual or organisation to propose a districting, with the winner having the best fitness value.

What “damien” is proposing, I take it, is the application of an algorithm somewhat like one familiar from computer science (especially cryptography) and grade school cafeterias known as “cut and choose”. How do you decide how to split a cupcake between two kids? One cuts; the other chooses. The elegance of cut-and-choose is that it harmonizes the incentives of the two parties. The cutter is incentivized to split equally, since the chooser can punish inequity.

Cut-and-choose is asymmetrical; the two participants have different roles. A symmetrical variant has each participant propose a cut and an objective third party selecting whichever is better according to the pertinent objective measure. This variant shares the benefit that each participant has an incentive to be more nearly equal than the other. If Alice proposes a cut that gives her 60% of the cupcake and Bob 40%, she risks Bob proposing a better split that gives her only 45% with him taking the remaining 55%. To avoid getting taken advantage of, her best bet is to propose a split as nearly equal as possible.

In the anti-gerrymandering application of the idea, the two parties propose districtings, which they could gerrymander however they wanted. Whichever of the two proposals has the lower objective function (lower isoperimetric quotient, say) is chosen. Thus, if one party gerrymanders too much, their districting will be dropped in favor of the other party’s proposal. Each party has an incentive to hew relatively close to a compact partition, while being allowed to deviate in appropriate cases.

A nice property of this approach is that the optimization problem doesn’t ever need to be solved. All that is required is the evaluation of the objective function for the two proposed districtings, which is computationally far simpler. (In fact, I’d guess the minimum isoperimetric quotient optimization problem might well be NP-hard.)

There are problems of course. The procedure is subject to gaming when the proposal-generating process is not private to the parties. It is unclear how to extend the method to more than two parties. Of course, the obvious generalization works once the eligible parties are determined. The hard part is deciding what parties are eligible to propose a redistricting. Most critically, the method is subject to collusion, especially in cases where both parties benefit from gerrymandering. In particular, both parties benefit from a districting that protects incumbencies for both parties. The parties could agree, for instance, not to disturb each other’s safe districts, and would benefit from observing the agreement.

Nonetheless, once districting is thought of in terms of mechanism design, the full range of previous algorithms can be explored. Somewhere in the previous literature there might be a useful solution. (Indeed, the proposal here is essentially the first step in Brams, Jones, and Klamler’s surplus procedure for cake-cutting.)

Of course, as with many current political problems (campaign financing being the clearest example), the big question is how such new mechanisms would be instituted, given that it is not in the incumbent majority party’s interest to do so. Until that’s sorted out, I’m not holding out much hope.