I generally hold John Tamny’s analysis of economic matters in high regard, so I was surprised to find his take on the American Airlines bankruptcy to be oddly lacking.

In his latest Forbes column, Tamny argues that it wasn’t its pension obligations, but monetary policy, specifically the weak dollar, that pushed American Airlines into bankruptcy.

The immediate reason he cites is high fuel prices, which are caused by the fact that oil is priced in dollars in the global market. High fuel prices have hit nearly all airlines hard, not just American. As Tamny himself notes, “Southwest Airlines was one of the few carriers that properly hedged its exposure to fuel prices that were set to go through the roof.”

What does set American Airlines apart is its pension and labor costs.

American’s pension liabilities are so enormous, at $10 billion, that to deny they were a major factor in the airline’s bankruptcy is contrarian to the point of absurdity. Tamny argues that those liabilities didn’t drive American to bankruptcy based on the notion that they would have been reflected in the airline’s stock price. However, that argument fails in the face of the dodgy accounting which many unionized companies with defined benefit pensions apply to those pensions. Information cannot get out into the market when it is suppressed or obscured.

Then there are labor costs, on which American spends $800 million more a year than its main competitors.

Finally, there’s the problem of management decisions that simply go awry. In that regard, last weekend’s interview of Alaska Airlines CEO Bill Ayer in The Wall Street Journal is worth reading. All too often, airlines place too much focus on gaining greater market share—usually through debt-fueled growth—and not enough on common sense strategies such as working to reduce per-mile costs.

The Chronicle of Higher Education reports that a team of eight law firms have just “sued a dozen more law schools across the country, accusing them of luring students with inflated job-placement and salary statistics and leaving graduates ‘burdened with debt and with limited job prospects.’ The lawyers . . . said they planned to file 20 to 25 new lawsuits every few months . . . the lawsuits had been filed on behalf of a total of 51 graduates, and each suit was seeking class-action status. The targets of the latest round of lawsuits” include  “Brooklyn Law School,” “Chicago-Kent College of Law,” “DePaul University College of Law,” “Golden Gate University School of Law,” “Hofstra Law School,” “University of San Francisco School of Law,” “Widener University School of Law,” and several others. As the Chronicle notes, “Disgruntled law-school graduates who can’t find jobs are increasingly taking their complaints to court, asserting that the schools duped them into enrolling with misleading statistics about their chances of landing well-paying jobs when they get out. Last year similar lawsuits were filed against New York Law School, Thomas M. Cooley Law School, and Thomas Jefferson School of Law.”

As I noted earlier, much of what law schools teach their students is useless drivel, and law schools routinely exaggerate their students’ job prospects. Accordingly, there is no reason to require people to attend law school before sitting for the bar exam. As law professor Paul Campos notes, legal education is often a rip-off, since the typical law professor has little real-world experience practicing law, and “knows nothing about being a lawyer.” But since most states require people to attend law school before sitting for the bar exam, law schools have been able to increase tuition by nearly 1,000 percent since 1960 in real terms. For its part, the Obama Education Department has implemented policies that encourage colleges to jack up tuition and charge students even more, even as college students are learning less and less.

Oklahoma taxpayers might be able to breathe a little bit easier this year thanks to two important pieces of legislation making their way through the state capitol.

A proposed amendment to the state’s constitution would enjoin any Oklahoma municipality not “to become indebted or contractually obligated, in any manner, or for any purpose” without the express approval of the municipality’s governing body, the municipal officer charged with budgetary oversight by the governing body, or a majority of the municipality’s citizens.

The amendment’s sponsor, Senator David Holt (R-Oklahoma City), has dubbed it the “Lincoln Amendment” because it “enshrines in our state’s Constitution a basic premise of American democracy — that our government is by the people and for the people, just as Lincoln said at Gettysburg.”

From Senator Holt’s office:

Recently, Oklahoma was ranked the most anti-taxpayer state in the entire southern United States by the Competitive Enterprise Institute. This was primarily because in Oklahoma, the wishes of local taxpayers and their elected representatives are routinely trumped when it comes to spending tax dollars, causing local governments to take on expenses they cannot afford, resulting in service cuts or requests for more taxes. The Lincoln Amendment is a response that shifts the power of the purse back where it belongs, to the taxpayers.

The state Senate is also considering the Oklahoma Paycheck Protection Act, which would amend the state code so that the state’s Office of Personnel Management can only direct payroll deductions to an organization if “the primary or core function of the organization is nonpolitical and nonpartisan.” The bill would also prohibit Oklahoma school districts from directing payroll deductions to teachers’ unions, and would prevent Oklahoma municipalities from writing union payroll deductions into employment contracts.

Oklahoma badly needs this measure to prevent unions from using money taken directly from teachers, firefighters, police officers and municipal employees for political causes. Making it illegal for Oklahoma’s OPM to send money directly to a union would absolutely ensure a public employee’s right to free association by protecting their right to stay out of union politics.

These critical measures are desperately needed to set Oklahoma’s fiscal house in order. According to George Mason University’s Mercatus Center, “several states including Illinois, New Jersey, Connecticut, Oklahoma, Indiana, Louisiana and West Virginia are slated to run out of assets to fund pension benefits by the end of the decade.” [Emphasis added.]

This problem is exacerbated when municipalities have the authority to ink plush pension deals with employees despite their limited taxation authority. According to that same Mercatus study, in Rhode Island “unfunded municipal pension liabilities currently exceed municipal revenues by $2.6 billion” and the town of Central Falls, Rhode Island, is currently in receivership.

Taken together, these bills will fundamentally redefine the relationship between the State of Oklahoma its employees. Employment contracts will be subject to more oversight and public employee unions will no longer be able to use Oklahoma’s Office of Personnel Management to raise money.

Oklahoma lawmakers are prepared to endow taxpayers with real protection against immoderate public employee compensation and to curb the influence of public employee unions by forcing them to justify their activism to their members instead of siphoning taxpayer funds to fuel their political ambitions.

Hopefully other states lurching toward insolvency will follow Oklahoma’s example, Sooner rather than later.

Proponents of government collective bargaining view it as a fundamental human right. The shameful actions of SEIU in Michigan, however, undermine this claim.

In 2005, Michigan lawmakers signed off to create the Michigan Quality Community Care Council (MQC3). MQC3 maintains a registry of homecare providers to assist Medicaid recipients looking for a caregiver. In reality, the primary function of MQC3 was to make 45,000 private homecare providers government employees and dues-paying union members.

In 2006, SEIU took advantage of Michigan law deeming homecare providers government employees. To gain exclusive representation SEIU organized a covert union campaign. The stealth-organizing tactic led to 20 percent voter turnout and SEIU won a landslide victory.

Soon thereafter, SEIU obtained a collective bargaining agreement (CBA) with the state. The events following the CBA expose the dangers of government union political influence and permanence of CBAs.

MQC3, acting as a “dummy” employer for homecare workers, created a mechanism for union dues to be siphoned off Medicaid checks. Not only is it illegal to unionize homecare workers who are private contractors, homecare workers already have employers: their Medicaid beneficiaries. Worse, the scheme wholly rejects the purpose of Medicaid by diverting funds from individuals who cannot afford medical care to Big Labor.

Since 2006, SEIU collected nearly $6 million a year and $28 million total (and counting) in union dues from Medicaid payments to homecare providers. The Mackinac Center broke the news and filed suit to stop the forced unionization and dues payments of homecare workers.

Once Michigan lawmakers became aware of SEIU’s exploitation, they took action to stop it. Gov. Rick Snyder eliminated MQC3 funding in the FY 2012 budget and planned to close the program on September 30, 2011. State Rep. Paul Opsommer (R) introduced H.B. 4003, banning stealth unionization of private contractors and forced union dues payments of homecare workers, which passed House.

Apparently, laws that protect low-income individuals with health problems are unpopular in Michigan. Union-friendly state lawmakers worked behind the scenes to stall H.B. 4003 in the Senate and to maintain union funding from MQC3. Their efforts included State Senator Roger Kahn (R) conducting a meeting with SEIU officials to preserve their forced dues collection. Sen. Kahn’s first notes of the meeting read. “SEIU is concerned re: moving forward w/ funding QC3. Gent. Agreement to find $.”

Sadly, SEIU’s collective bargaining power made their political influence superfluous. The binding powers of CBAs allow SEIU to continue collecting union dues until the contract expires on November 15, 2012.

Mackinac Center Legal Foundation Director Patrick Wright explains the devastating effects of union political influence combined with government collective bargaining power, “The amazing resilience of MQC3 indicates that legislation is going to be required to ultimately end the government employee unions’ practice of diverting money from the state’s most needy citizens to fill their own coffers.”

All attempts to protect those in need and taxpayers (by way of lawsuits, reform, and defunding) from corruption have failed. Big Labor’s ability to convince legislators to set up dummy agencies enabling unions to steal from taxpayers is so strong that repealing government union collective bargaining power is the only way to end all such heinous behavior.

However, one legal maneuver may be left to stop illegal forced-dues payments and to recover taxpayer funds in Michigan. Medicaid receives funding from federal and state governments, opening the door for filing “false claims” charges in both state and federal courts to recover taxpayer funds. False claims are taxpayers’ most powerful tool to recover stolen government funds.

On the federal level, the False Claims Act, 31 U.S.C. §§ 3729-3733, allows taxpayers to recoup losses from any person or entity that “knowingly presents, or causes to be presented, a false or fraudulent claim for payment or approval.”

In Michigan, the Medicaid False Claims Act, Act 72 of 1977, directs the state “to prohibit fraud in the obtaining of benefits or payments in connection with the medical assistance program; to prohibit kickbacks or bribes in connection with the program.” Violations of the Medicaid False Claims Act involve “making a claim or causing a claim to be made under the social welfare act that contains a statement of fact or that fails to reveal a fact, which statement or failure leads the department to believe the represented or suggested state of affair to be other than it actually is.”

The creation of MQC3 was fraudulent, exposed as political payback from e-mails obtained by the Mackinac Center. Additionally, proposals creating MQC3 failed to reveal the fact that union dues would be taken out of Medicaid payments.

Government union collective bargaining power allows Big Labor to steal from the needy and increase the costs of providing public services. Removing collective bargaining power from government unions would diminish their political influence and reduce false claims and fraud.

Last week, the Metropolitan Washington Airports Authority announced it was considering scrapping the Silver Line stop at Dulles Airport.

Though the Silver line was designed specifically to provide service to Dulles Airport, MWAA Board Member Bob Brown said it “wouldn’t be much of an additional burden on riders because even if Metro stopped at the airport people would still have to take a hike to the airport terminal” (1,150 feet – more than three football fields).

That’s right, MWAA just admitted that the proposed metro stop at Dulles Airport would be so inconvenient that air travelers aren’t likely to use it. So if the Silver Line is really just a westward extension of commuter rail that might not even stop at Dulles Airport, why is MWAA still involved?

More importantly, why would Virginia (one of only eight states with a AAA bond rating and the only one to have kept it without interruption for the last seventy years) surrender authority over a $6.8 billion infrastructure project to a notoriously secretive and debt-addicted semi-private entity like MWAA?

Virginia turning the reins of a large and complex project over to an opaque agency with a worse credit rating than France might seem completely backwards, but maybe the alternative to MWAA is even worse. One argument in favor of giving MWAA jurisdiction over planning the Silver Line is that it is a less wasteful and incompetent entity than the Kafkaesque Washington Metropolitan Area Transit Authority, which will ultimately run it.

WMATA’s shortcomings are well documented: it boasts a credit rating of A1 (the rating Italy just lost, “somewhat more susceptible to the adverse effects of changes in circumstances and economic conditions than obligors in higher-rated categories”), expects an revenue shortfall of $89 million for FY 2012, and can’t even keep the escalators in Metro stations from falling apart and injuring riders (let alone prevent train collisions).

Virginia’s decision to play along with MWAA has led to a great deal of confusion about the Silver Line’s cost and timeline, stemming from planning decisions like the infamous underground Dulles Airport Station (a pet concern of Mame Reiley) and the Project Labor Agreement (PLA) mandate slipped in by Dennis Martire (MWAA Board member and VP at the Laborers International Union of North America).

Before MWAA decided that Dulles Airport might not need a metro stop at all, nine members of its governing board felt that building a “first-class” Dulles station was so essential that it was worth hundreds of millions of dollars in extra costs to site the station underground, 500 feet closer to the terminal. Once Virginia voters found out, an unprecedented coalition of local politicians from both parties threatened to stop the project altogether unless plans for the underground station were scrapped.

Once sufficient political pressure mounted against the PLA mandate, MWAA released a Memorandum of Agreement (MOA) that stated “no prime contractor working or seeking to work on Phase 2 shall be required…to become a party to any labor agreement other than the Phase 2 PLA.” Ironically, no one can seem to agree what this MOA means: it states in the same breath that no prime contractor shall be required to sign a Project Labor Agreement but that the Phase 2 PLA is binding.

Both of these major crises point to a central underlying flaw in MWAA’s (and WMATA’s) governance: it is unaccountable. MWAA exists in bureaucratic limbo, a “a public body corporate and politic and independent of all other bodies” (VA Code § 5.1-153), meaning that it is exempt from federal contracting requirements like competitive sourcing and from Virginia’s Freedom of Information Act (FOIA).

In response to these concerns, there are two pieces of legislation making the rounds in Richmond, HB 33 (whose many patrons include Barbara Comstock – R, 34th District) and HB 2 / SB 3 (Bob Marshall – R, 13th District / Dick Black – R, 10th District).

Both of these address themselves to clarifying the Project Labor Agreement issue: if PLAs are mandated for Phase 2, Virginia will not fund Phase 2. HB 33 is a strongly worded piece of legislation aimed at ensuring that future joint infrastructure investments with neighboring states will not conflict with Virginia’s Right to Work law.

However, HB 2/SB 3 goes a step further by explicitly requiring MWAA to comply with Virginia’s Freedom of Information Act in order to become eligible for Virginia funds, addressing the underlying flaw in MWAA’s governance that allows this type of controversy to fester.

Biologists like to joke that the platypus is an animal designed by committee, being possessed of features that seem to have no practical necessity like a duck bill, poison claws, electroreception, and egg-laying.

The Silver Line extension of Metro is the platypus of infrastructure projects: a confusing and often contradictory mess of atavistic regulation and bureaucratic overlap that ought to be scrapped and redesigned from the ground up.

It remains to be seen whether the Virginia legislature has the wherewithal to do so.

Harvard University economist Jeffrey Miron argued that the $800 billion stimulus package wasn’t even designed to stimulate the economy, but rather to benefit special-interest groups, since it flunked even old-fashioned Keynesian policy prescriptions about how to revive the economy. Recently-disclosed memos obtained by the New Yorker provide more evidence for this argument: “over the objection of his economic advisors, President Obama replaced $60 billion of ‘highly stimulative spending’ with a slow-spending but ‘inspiring’ $20 billion for high-speed trains and $40 billion in pork for his Senate Democratic allies. And this is starting from a point at which he knew that his advisors thought that not more than $225 billion of the $826 billion total was high-quality, fast-spending, efficient stimulus.”

This is not the only way that Obama ignored economics in favor of politics when drawing up the stimulus. Originally, economists wanted the stimulus to include the kinds of transportation spending that could boost the economy. But the stimulus package was purged of most investments in roads and bridges, and filled instead with welfare and social spending, out of political correctness, after feminist leaders complained that fixing roads and bridges would put unemployed blue-collar men to work, rather than women. Christina Hoff Sommers points out that “of the 5.7 million jobs Americans lost between December 2007 and May 2009, nearly 80 percent had been held by men,” because men “predominate in manufacturing and construction, the hardest-hit sectors.” But when some administration officials floated the concept of “an ambitious . . . stimulus program to modernize roads, bridges,” and infrastructure as a way of “reinvigorating the hardest-hit sectors of the economy,” “Women’s groups were appalled,” denouncing “The Macho Stimulus Plan.”  The Obama administration quickly knuckled under to this pressure, resulting in a “stimulus” package that spent money instead on social services like welfare that are administered mostly by female employees.  As an AP story noted “Stimulus Aid Favors Welfare, Not Work, Programs.” (The stimulus package largely repealed welfare reform).

The little “transportation” spending that remained in the stimulus package was disproportionately wasted on laying the groundwork for “high-speed” rail boondoggles that are not actually “high” in speed. These multibillion dollar rail boondoogles would provide work at inflated wages for politically-powerful unions. But these projects are expensive white elephants that would be used by very few travelers at an enormous cost per mile, and not enable trains to go anywhere near as fast as they do in Europe, Japan, or China. (Other union-backed provisions in the stimulus package wiped out jobs in America’s export sector.)

Similarly, the “green jobs” Obama promised in the stimulus package never came into being, as even The New York Times has conceded. Instead, the stimulus package’s green-jobs spending ended up inadvertently outsourcing American jobs to China. The administration’s green-energy programs also wiped out jobs in the furniture industry.

Obama relied on exaggerated claims to push through the stimulus package, claiming it was needed to prevent an “irreversible decline” in the economy,  even though the Congressional Budget Office admitted that the stimulus package would shrink the economy “in the long run.” Even an old-fashioned Keynesian stimulus might have been something that America could not afford at a time of record deficits. The Congressional Budget Office, ignoring the above flaws in the stimulus package, argued that it would boost the economy in “the short run.” But even the CBO conceded that the stimulus would shrink economic output in “the long run” by increasing the national debt and thus crowding out private investment.

Propped up by government subsidies and regulations requiring students to attend law school before taking the bar exam, law schools waste their students’ time teaching irrelevant legal theories and ideologies, even as they paint a deceptively rosy picture of the job prospects that await their students upon graduation.  As I noted in The Wall Street Journal this weekend,

At Harvard Law School I learned about trendy ideological fads and feminist and Marxist legal theory. But I did not learn the basics of real-estate and family law until I took a commercial bar-exam preparation course after graduating from law school. I learned more practical law in one summer of studying for the bar exam than I did in three years of law school. Students should not have to attend law school before taking the bar exam.

As Charlotte Allen notes at Minding the Campus, law schools are “fudging the facts” regarding their students’ job prospects in order to attract students and justify skyrocketing tuitions:

law schools, along with the universities to which they are attached, crave their students’ tuition dollars (law schools, where expensive labs are nonexistent and large lecture courses are the rule, tend to be cash cows for their host campuses) . . . One way to do this is to boast a high percentage [to U.S. News & World Report of] “graduates known to be employed within nine months after graduation.”

The “known” in the phrase “known to be employed” is the operative word. Law schools send their recent graduates surveys . . .  The graduates then self-report their employment, if any, and the school calculates the percentage of those who responded who say they have jobs and submits it to U.S. News. Graduates who fail to respond to the survey or who can’t be located don’t count. Furthermore, any kind of job counts as “employment,” even a job that requires no legal training. In a Jan. 8 story for the New York Times, reporter David Segal wrote: “Waiting tables at Applebee’s? You’re employed. Stocking aisles at Home Depot? You’re working, too.” . . . Segal reported that Georgetown University’s law school, safely in the top tier . . . last year sent an e-mail to its graduates who were “still seeking employment” offering them $20-and-hour temporary jobs in the admissions office for the six weeks encompassing Feb. 15, the cut-off date under U.S. News’s nine-month rule. . .As might be easily predicted from these loosey-goosey controls on survey accuracy, even the lowest-tiered law schools report astonishingly high levels of employment for their graduates. . .Last year that number had jumped to 93 percent, with some schools reporting 99 percent and 100 percent employment.

Furthermore, many law schools report starting salaries for their graduates that seem unrealistically high, given the current dismal market. In a July 16, 2011 story for the New York Times Segal noted that New York Law School (NYLS), a third-tier institution in lower Manhattan with a U.S. News ranking of No. 134, told the magazine that the median annual salary nine months after its Class of 2009 graduated was $160,000–the same figure cited by Yale and Harvard, which ranked No. 1 and No. 2 for that year. Only the largest and most prestigious law firms pay three-figure salaries to brand-new lawyers, and they hire most of them from top-tier, not third-tier law schools. . .

Since it’s estimated that a law graduate needs to earn $65,000 at a bare minimum in order to pay down a student-loan debt in the $100,000 range, there’s quite a bit of anger among unemployed and under-employed young lawyers burdened with staggering loans that, like other federal student loans, can’t be discharged in bankruptcy. Class-action lawsuits alleging fraud and misrepresentation have been filed by graduates of NYLS and the Thomas M. Cooley Law School . . . the lawyers who launched the NYLS and Cooley suits plan to sue fifteen more law schools that have reported post-graduate employment rates ranging from 88 percent to 100 percent–rates that the lawyers say amount to misrepresentation.

As I have previously explained, there is no reason to require people to attend law school before sitting for the bar exam. As law professor Paul Campos notes, legal education is a rip-off, since the typical law professor “knows nothing about being a lawyer. Hence, he must bullshit,” and thus, “talks without knowing what he is talking about,” when explaining the practical workings of the legal system or how to be a lawyer. But since most states require people to attend law school before sitting for the bar exam, law schools have been able to increase tuition by nearly 1,000 percent since 1960 in real terms.

A prominent federal judge has added to the growing chorus of criticism for American law schools and their failure to provide practical training for their students despite charging exorbitant tuition:

Judge José Cabranes of the U.S. Court of Appeals for the 2d Circuit . . .noted that law schools are in “something of a crisis,” given the skyrocketing cost of tuition, ever-higher graduate debts and a growing feeling that legal scholarship is of little use to the bench or practitioners. …

To get back on track, law schools should shift their curricula back to core courses and away from the interdisciplinary classes that have grown in popularity, he said; they should introduce a two-year core law program followed by a yearlong apprenticeship, and increase transparency regarding costs, job prospects and financial aid information. …

Cabranes lamented the move by law schools toward specialized, often interdisciplinary courses that can displace “black-letter” law courses — criminal and civil procedure, evidence and federal courts. He related a story about a friend’s child who enrolled in a law school clinic focusing on housing court — but who had never taken a property law course. Core law courses should come before clinics and interdisciplinary work, even if the latter are more popular with students and faculty, he said. …

Cabranas also offered a harsh assessment of the scholarship that legal educators are producing. He recalled recent criticism from several Supreme Court justices that the scholarship has left “terra firma” in favor of outer space. “Legal scholarship is a conversation among members of the academy with the rest of us reading — maybe,” he said.

Cabranes also “condemned a growing ‘cult of globalization,” in which law schools focus on trendy international concerns, rather than give their students a “solid foundation in the law.” An earlier news story in The New York Times described what a costly white elephant  law schools have become. Law school is expensive because of government-enforced accreditation standards that prevent law schools from containing costs even if they wanted to: “the lack of affordable law school options, scholars say, helps explain why so many Americans don’t hire lawyers” when they genuinely need legal assistance or advice. Lawyers need to bring or work on big-ticket lawsuits — even socially destructive lawsuits — to pay off their student loans, instead of providing badly needed legal advice and assistance to people of modest means, who can pay less. (Certain types of lawsuits are favored by one-way fee-shifting statutes that encourage trial lawyers to bring those particular types of lawsuits, even when the entity being sued is probably innocent.)

The Equal Employment Opportunity Commission recently posted a letter on its website claiming that it is illegal for employers to have a high-school diploma requirement if an applicant who is learning-disabled was unable to graduate from high school. The EEOC’s letter radically stretches the concept of “disparate impact” or unintentional discrimination beyond what most  courts would allow, in a way that will harm small employers.

Under Supreme Court precedent, an employer can be liable for “unintentional discrimination,” or “disparate impact,” if it has a job requirement that systematically screens out many more members of a minority group than other groups. For example, back when few black people in North Carolina had high-school diplomas, the Supreme Court ruled that a power company there that required high-school diplomas for unskilled jobs was liable for “racially disparate impact,” since the requirement systematically screened out large numbers of black people at a much higher rate than white people.

But the fact that a job requirement screens out a small number of applicants of a given race (or a given minority group, like the disabled) is not enough to state a claim. It has to weed out a large number of such applicants, in a systematic way. Thus, small businesses are usually beyond the tentacles of the EEOC, since they generally don’t hire a large number of people, or have a large number of minority applicants. Employers sued because their job requirements had unintended racial disparities have nonetheless prevailed in court when the absolute number of minority applicants rejected for the job was small, such as a dozen or fewer. Moreover, as the Tenth Circuit Court of Appeals noted in Coe v. Yellow Freight (1981), “discriminatory impact cannot be established where you have just one isolated decision. A claim of discrimination resulting from the mode of filling a single position does not give rise to a disparate impact.”

The EEOC is just ignoring these court decisions in its recent letter, as I noted in today’s Washington Times:

The Washington Times was right to criticize the Equal Employment Opportunity Commission (EEOC) for its recent letter claiming that it is illegal discrimination to require job applicants to have high school diplomas (“EEOC undermines job creation,” Comment & Analysis, Jan. 3).

The EEOC’s claim is lawless and part of a pattern of economically destructive assaults on employers. The claim that an employer must drop its diploma requirement just because a single learning-disabled applicant was unable to graduate conflicts with court rulings. Court decisions such as Coe v. Yellow Freight (1981) make clear that a “disparate-impact” discrimination claim cannot be based on the fact that a selection criterion screens out a single applicant or a small group of applicants.

This is just one of many unreasonable demands by the EEOC. The commission recently threatened public safety by demanding that employers hire truckers with histories of heavy drinking and that they drop criminal background checks. These demands discourage hiring: If an employer is not allowed to hire based on merit, it may decide not to hire at all.

Yesterday, the Supreme Court unanimously rejected the argument of the EEOC and the Obama administration that churches do not have any religious-freedom rights that protect their hiring decisions against liability under federal employment and anti-discrimination laws. However, the EEOC has been more successful in lower courts dominated by liberal judges, where it has convinced some appeals-court panels to find employers liable for conduct that was not previously considered discriminatory by most courts. It has also convinced some liberal appeals-court panels to hold employers liable for failing to prevent offensive workplace speech by workers that the EEOC now claims constitutes sexual or racial “harassment,” but which past appellate rulings had indicated was not severe or pervasive enough for liability. (Overly expansive or vague notions of what speech constitutes “harassment” create First Amendment problems, as various judges have noted, including U.S. Supreme Court Justices Clarence Thomas, Sandra Day O’Connor, and Samuel Alito, Justice Ming Chin of the California Supreme Court, Judge Alex Kozinski of the Ninth Circuit Court of Appeals, Judge Brooks Smith of the Third Circuit, Judge Timothy Tymkovich of the Tenth Circuit, and Judges Emilio Garza and Edith Jones of the Fifth Circuit.)

The EEOC is also wiping out jobs and discouraging hiring and job creation through onerous interpretations of federal employment laws, as I explain at this link.

The Supreme Court has rejected the Obama administration’s argument that it can dictate who churches hire as ministers or clergy in Hosanna-Tabor Evangelical Lutheran Church and School v. Equal Employment Opportunity Commission. The Obama administration unsuccessfully argued that the government can dictate who churches hire, as long as it also subjects secular employers to the same dictates regarding who they hire (so-called rules of general applicability). Taken to its logical conclusion, this argument would allow the government to ban a church or synagogue from hiring based on religion (defeating the whole purpose of religious freedom, which is to allow churches to promote their own religion) or sex (preventing the Catholic Church from having a male priesthood). No Supreme Court justice bought the administration’s argument, made on behalf of the Equal Employment Opportunity Commission (EEOC). The Supreme Court unanimously found that such government control over who churches can hire would violate the religion clauses of the First Amendment.

If federal antidiscrimination laws covered churches’ hiring of clergy, as the Obama administration demanded, they would have to not just avoid discriminating based on things like sex or religion, but would also have to radically alter sensible hiring criteria by eliminating longstanding, neutral church practices that have the affect of inadvertently screening out more members of a minority group than of other groups (so-called “disparate impact” or “unintentional discrimination”). For example, some branches of the Lutheran Church have hiring criteria for religious broadcasters on their radio programs, such as “knowledge of Lutheran doctrine,” and “classical music training,” that few minorities satisfy (only 2 percent of all people with Lutheran training are minorities, and only 0.1 percent of people with both Lutheran training and classical music training are minorities), given the Lutheran Church’s historical roots in overwhelmingly white areas like Germany, Scandinavia, and Minnesota. Even though they are happy to have black applicants, and do not treat black applicants worse based on their race, the EEOC could easily sue them for racially disparate impact if the Obama administration’s argument had been accepted. (The religion clauses of the First Amendment not only protect who churches hire as ministers, but also other people who serve as “voices of the church,” such as theology professors, and religious broadcasters on behalf of a church.)

We previously wrote about ways that the Obama administration is attacking religious freedom and separation of church and state at this link. We described how the Equal Employment Opportunity Commission is wiping out jobs and discouraging hiring and job creation through onerous interpretations of federal employment laws, at this link.

The extreme position taken by the Obama Justice Department in the Hosanna-Tabor case is a reflection of ideologically-based hiring. Under the Obama administration, the Justice Department has chosen to hire only liberal lawyers, not moderates or conservatives, for key Justice Department posts that are supposed to be non-political career appointments. Although many experienced lawyers are out of work in the current economic slump, the Obama Justice Department has hired many liberals who have no real-world legal experience, rather than hiring based on merit.

More commentary about the Hosanna-Tabor case can be found at this link. (The Obama administration suggested in its briefs that freedom of association could provide a theoretical check on government demands that institutions not hire based on specified criteria, even if — as it claimed — religious freedom does not limit the reach of employment laws that apply to both secular and religious employers. But this suggestion was disingenuous, since the administration and the EEOC have argued in other cases that free-association rights are outweighed and overridden by the government’s compelling interest in eradicating discrimination. And free-association defenses, unlike religious-freedom defenses, are generally losers, as the Supreme Court’s Hishon, Jaycees , and New York State Club Association decisions illustrate. Those rulings held that the government’s compelling interest in eradicating discrimination overrode the mere free-association rights of a law firm and various private clubs.)