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The Register  – An ICLE statement on President Joe Biden’s executive order implementing the U.S.-EU Data-Privacy Framework was cited in a story in The Register about transatlantic data flows. You can read full piece here.

Meanwhile, US-based International Center for Law & Economics welcomed the executive order, but said further litigation was “all-but-certain.”

Washington Examiner – ICLE Senior Scholar Mikolaj Barczentewicz was quoted by the Washington Examiner in a story about the White House executive order implementing the new U.S.-EU Data-Privacy Framework. You can read full story here.

However, there are some concerns that a delayed approval by the European Commission could be detrimental to European businesses. “It is urgent that agreement on an effective Privacy Shield be reached expeditiously, as EU citizens already face the potential to lose access to services like Google Analytics and Facebook, not to mention the potential disruption to financial services like insurance and payments networks,” said Mikolaj Barczentewicz, senior scholar at the International Center for Law & Economics.

PORTLAND, Ore. (Oct. 7, 2022) — An executive order announced today by President Joe Biden to establish a new Privacy Shield framework marks an important next step in urgent negotiations to maintain transatlantic data flows between the United States and European Union that power an estimated $333 billion in annual trade of digitally enabled services, according to scholars with the International Center for Law & Economics (ICLE).

The order had been awaited since March, when U.S. and EU officials reached an agreement in principle on a new Privacy Shield, which EU officials insist must address concerns about surveillance practices by U.S. agencies. It will now be submitted to a months-long ratification process by the European Commission but, like earlier agreements, could also face legal challenges, ICLE Senior Scholar Miko?aj Barczentewicz said.

“It is urgent that agreement on an effective Privacy Shield be reached expeditiously, as EU citizens already face the potential to lose access to services like Google Analytics and Facebook, not to mention the potential disruption to financial services like insurance and payments networks,” Barczentewicz said. “What will be crucial is that the U.S. proposal addresses the two aspects the EU expects to be covered: redress for EU citizens and assurances that U.S. data-surveillance practices are ‘necessary and proportionate.’ We can hope that the EU courts will be reasonable, but litigation is all-but-certain.”

For more on the issue, see the ICLE issue brief “The Great Transatlantic Data Disruption,” as well as this ICLE explainer on the importance of data flows to the financial services sector. Reporters interested in interviewing Miko?aj Barczentewicz or other ICLE scholars should contact ICLE Media and Communications Manager Elizabeth Lincicome at [email protected].

Grid – ICLE Editor-in-Chief R.J. Lehmann was quoted by Grid in a story about the National Flood Insurance Program and Hurricane Ian. You can read full story here.

This war chest means that FEMA will likely not have to go to Congress for more funding to pay out claims, R.J. Lehmann, a senior fellow at the International Center for Law and Economics, told Grid. “It is very unlikely Ian will pass $18 billion in claims, which would save NFIP from having to go to Congress,” Lehmann said.

But for the overall market, “the Florida insurance story is that our market was already collapsing,” Lehmann said.

…“At some point, we will have to bite the bullet,” Lehmann said. “That exposure of Florida as a low-lying peninsula means you have to charge much more than people can afford, and you will need public policy that will involve buying people out and saying ‘You can’t live here anymore.’”

Slate – ICLE Editor-in-Chief R.J. Lehmann was quoted by Slate in a story about the impact of Hurricane Ian on Florida’s insurance market. You can read full story here.

R.J. Lehmann, an insurance expert with International Center for Law & Economics who lives in St. Petersburg, told me Florida’s “perilous position” had its roots in the brutal period from 2004 to 2006 when a handful of huge storms caused widespread damage. “In most of the country, you do not find companies that only write homeowners’ insurance. It’s not a very profitable line,” he said. National insurers minimized their exposure, and smaller ones haven’t been able to take the heat…

…Third is that Citizens is repeating, at a state level, the mistake that the National Flood Insurance Program is making nationally: It subsidizes people who build and buy in places that they probably shouldn’t. “The useful role of insurance is that prices convey information about risk. You shouldn’t build somewhere people can’t afford the insurance,” Lehmann said. “Living on barrier islands is probably not a thing we can’t allow anymore. It’s difficult to move people. But at least stop future development.” High premiums send a message: This is not a safe place to live.

Wall Street Journal  – An ICLE report on the German system of sectoral bargaining was cited in a column in The Wall Street Journal about California’s plan to adopt similar rules for the fast-food sector. You can read full piece here.

Many do. German employees and employers are voting with their feet and running away from sectoral bargaining. According to a recent report from the International Center for Law and Economics (which was supported by a German law firm affiliated with Mr. Lotito’s employer), the percentage of employees covered by a sectoral agreement in western and eastern Germany has plummeted over the past quarter-century by 25 and 24 percentage points, respectively.

The ICLE authors detail some of the reasons for the contraction: Sectoral agreements are inflexible; they saddle companies with complex work rules; and they require “uniform compensation” regardless of an employee’s work performance. This means that employees and employers are avoiding union-negotiated agreements in Germany for the same reasons they are avoiding these agreements in the U.S.

Christian Science Monitor – ICLE Editor-in-Chief R.J. Lehmann was quoted by the Christian Science Monitor in a story about the risk of hurricanes in Florida and what it means for the state’s insurance market. You can read full story here.

“We were already in crisis before this storm, and we will certainly be in full collapse after this storm,” says Ray Lehmann, editor-in-chief of International Center for Law & Economics. “If you look at the history of Florida, going all the way back to [the founding of] St. Augustine, it exists as a long series of speculative real estate bubbles. At some point the gravy train is going to stop. We’re getting there.”

…“We have thinly capitalized, very undiversified domestic insurers, six of whom have been declared insolvent in the last year and two dozen more that stand ready to be downgraded” by a rating agency, says Mr. Lehmann, in Tampa.

…“There is very little political will to do the things that need to be done,” says Mr. Lehmann. “I’m sure we will start hearing calls that we need a federal catastrophe fund” to shore up insurers, “but the major problem with that is that it benefits no other state.”

ClimateWire – ICLE Editor-in-Chief R.J. Lehmann was quoted by ClimateWire in a story about the state of the National Flood Insurance Program following Hurricane Ian. You can read full story here.

R.J. Lehmann, an expert on flood insurance at the International Center for Law & Economics, said that if the National Flood Insurance Program ran out of money, policyholders “would get in line and wait for some form of authority” from Congress to borrow money or forgive the $20.5 billion debt.

“They would have no capacity to pay any claims at that point,” Lehmann said. “It is possible the NFIP could default on its obligation to its policyholders.”

Both Lehmann and Fugate said they doubted Congress would let the program run out of money. They said lawmakers would probably increase its borrowing capacity by either forgiving the $20.5 billion debt or by enacting legislation similar to the bill DeSantis opposed in January 2013 — to increase its borrowing authority.

PORTLAND, Ore. (Oct. 4, 2022) – Germany’s system of “sectoral bargaining”—in which unions representing all workers in a given sector bargain over the terms of employment for all firms in that sector—has drawn growing interest from some quarters in the United States. But a new issue brief from the International Center for Law & Economics (ICLE) examines the legal and practical issues that would arise should U.S. policymakers seek to import the German model to these shores.

Advocates for sectoral bargaining argue that it is better for workers and can even protect the economy from adversarial labor-market disputes, claims that were examined in an earlier ICLE issue brief by Matthias Jacobs of Bucerius Law School and Matthias Münder of the law firm Schramm Meyer Kuhnke.

But as ICLE Senior Scholar Julian Morris and Director of Innovation Policy Kristian Stout note, the proportion of German employees working under a sectoral-bargaining agreement has fallen by more than 35% since 1996, with the reduction driven by the changing nature of work and increasing exposure of German markets to international competition.

“In an environment of international competition, Germany’s model required all manner of tweaks in order to make it ‘work.’ Even then, Germany’s rate of economic growth has been considerably lower than that of the United States,” Morris and Stout write, adding that the gap in per-capita output between Germany and the United States has increased from less than $2,000 in 1991 to more than $10,000 in 2021.

Nonetheless, proposals for German-style sectoral bargaining have proliferated in recent years. California recently passed the Fast Food Accountability and Standards Recovery Act (FAST Act), which applies important features of European sectoral-bargaining models to the state’s fast-food sector. Sectoral-bargaining proposals have also been floated in Illinois, Connecticut, and New York State, and several candidates in the 2020 U.S. Democratic Party presidential primaries forwarded proposals for labor-market reforms that were based explicitly on such ideas.

Sooner or later, Morris and Stout write, such proposals are bound to run headlong into U.S. antitrust law, which broadly prohibits competitors from coordinating their behaviors in ways that set prices or cause anticompetitive harm to consumers. Any attempt to bring sectoral bargaining to the United States would therefore need either an explicit statutory exemption from Congress or to qualify for one of the existing non-statutory exemptions, the authors argue.

“As the United States heads further into unstable economic times, it would be unwise to adopt a bargaining model that would make its labor market less flexible and more subject to the disruptive effects of competition from overseas and from new technology,” Morris and Stout write.

The full white paper is here. Journalists interested in interviewing ICLE scholars about the law & economics of sectoral bargaining should contact ICLE Editor-in-Chief R.J. Lehmann at [email protected] or 908-265-5272.