Don Langevoort's paper, The SEC, Retail Investors, and the Institutionalization of the Securities Markets, and Jill Hasday's forthcoming Minnesota Law Review article, Fighting Women: The Military, Sex, and Extrajudicial Constitutional Change, have just been posted to SSRN and BePress.
The last thirty years or so have brought a rapid shift toward institutionalization in the financial markets in the U.S., i.e., investment by mutual funds, pension funds, insurance companies, bank trust departments and the like. This paper focuses on the institutional role of the SEC as a seventy-five year old agency in a capital marketplace far different from that of the 1930’s. A baseline question about the future of financial regulation in the U.S. is whether the SEC, with such a long and weighty legacy of law-making from a time when public markets were retail markets, is competitively fit to act as a regulator in a capital marketplace that is now so institutional and global. Part I asks whether there is a coherent theory or approach to retail investor protection in today’s marketplace, either in terms of enforcement intensity or rule-making. This Part considers two very different contemporary challenges to SEC’s orthodoxy: the emergence of the British “light touch” to securities industry regulation, which favors informal suasion to heavy-handed enforcement, and the expansion of knowledge about consumer and investor behavior from research in behavioral economics. Neither, it argues, maps well onto the SEC’s mission. Part II then moves to the institutional marketplace for issuer securities and engages in a thought experiment about whether, as many assume, markets that have no appreciable retail participation should properly be governed as “antifraud only.” This Part considers what antifraud-only means, and again expresses some skepticism about whether we can expect to see the development of private markets, largely free of regulation, that substitute for the public ones we observe today. Finally Part III takes up whether the SEC’s regulatory orthodoxy is stable enough as markets become not only institutional but global. It suggests, contrary to what many believe, that globalization leads to increasingly territorial (rather than listings) based exercise of regulatory jurisdiction over issuer disclosure. It also places the SEC’s recent initiatives toward mutual recognition in this context. The unifying theme in all three Parts stems from a long-standing interest in studying the behavior of the SEC: why it acts as and when it does and (often more importantly) what limits it imposes on itself or has imposed from outside.
The Supreme Court in Rostker v. Goldberg (1981) upheld male-only military registration, and endorsed male-only conscription and combat positions. Few cases have challenged restrictions on women's military service since Rostker, and none have reached the Supreme Court. Federal statutes continue to exclude women from military registration and draft eligibility, and military regulations still ban women from some combat positions. Yet many aspects of women's legal status in the military have changed in striking respects over the past quarter century while academic attention has focused elsewhere. Congress has eliminated statutory combat exclusions, the military has opened many combat positions to women, and the public has become more enthusiastic about women's military service, including in combat.
This Article brings long overdue attention to the record of women's legal status in the military in order to make three broad theoretical and historical points. First, women's continued exclusion from registration, draft eligibility, and some combat positions undermines the common assumption that legalized sex inequality has faded into history. Second, the record of women's legal status in the military helps illuminate how extrajudicial events can shape the Supreme Court's constitutional interpretation and then render that interpretation much less plausible over time. Rostker reflected contemporaneous understandings of sex equality. The extrajudicial transformation in women's military role since Rostker has undercut the factual premises and cultural assumptions behind Rostker's interpretation of constitutional equal protection, making clear that Rostker is inconsistent with the rest of the Court's sex discrimination jurisprudence. Third, and most strikingly, the record of women's legal status in the military illustrates how extrajudicial actors can develop and enforce their own evolving understanding of sex equality norms, sometimes becoming a more important source of those norms than courts. The extrajudicial transformation in women's military role has shifted the foundational normative commitments that shape the evolving meaning of constitutional equal protection. This transformation makes limits on women's military service that seemed just and reasonable in the 1970s and 1980s, even to many proponents of sex equality in constitutional and statutory law, now appear increasingly wrong, inequitable, and invidious. Over time, that shift in perspective is likely to affect demands for further change and judgments that both courts and extrajudicial decisionmakers reach about how the Constitution's open-textured language of equal protection applies to specific questions about women's military role. The Article concludes by exploring some of the practical consequences of the extrajudicial shift in perspective on women's military service.