VI. Administrative & Regulatory Practice
Peter Schuck, Foundations of Administrative Law (2003) is a useful collection of articles in this field covering a number of subtopics, including the theory and history of administrative law, the Administrative Procedure Act, theories of administrative agency behavior, and the problem of administrative discretion.
Two student course books in administrative law deserve special mention, since they seem more attuned to the shortcomings of regulation than most such texts. The preface to Alfred C. Aman, Jr. & William T. Mayton, Administrative Law (1993), includes an acknowledgement by Mayton of an intellectual debt to Hayek. Richard J. Pierce, Sidney A. Shapiro & Paul R. Verkuil, Administrative Law and Process (4th ed. 2004), contrasts the "public interest" and "public choice" explanations for regulation in chapter 1.
Peter Aranson, Theories of Economic Regulation: From Clarity to Confusion, 6 J. L. & Pol. 247 (1990). A clear statement of some core ideas in regulatory law: the welfare economics case for regulation, the public choice case against it, and the phenomenon of deregulation (which causes some problems for both the welfare economics and the public choice positions). A good introduction to the relevant literature.
Robert W. Hahn, Regulation: Past, Present, and Future, 13 Harv. J.L. & Pub. Pol'y 167 (1990). Provides an overview of (mostly federal) regulation, a description of some efforts at regulatory reform, and a call for new approaches to regulation in particular industries. A good introduction to the field.
The Purposes and Critiques of Regulation
Richard J. Pierce, Jr. & Ernest Gellhorn, Regulated Industries in a Nutshell (4th 1999), contains a good, short discussion of relevant economic concepts and a good discussion of the reasons most often offered for regulating business. For an overview of the law and economics literature on administrative law, consult chapters 12, 13, and 22 of Richard Posner, Economic Analysis of Law.
Stephen Breyer, Regulation and Its Reform (1982). This book contains a very useful explanation of the classic arguments in favor of regulation (market failure), along with an extensive diagnosis of the shortcomings of various forms of regulation (government failure). For a precis of the book, see Stephen Breyer, Analyzing Regulatory Failure: Mismatches, Less Restrictive Alternatives, and Reform, 92 Harv. L. Rev. 547 (1979).
Stephen Breyer, Breaking the Vicious Circle: Toward Effective Risk Regulation (1993). Justice Breyer identifies three systemic faults in the government's efforts to regulate risky behavior-namely bureaucrats' "tunnel vision," "random agenda selection," and "inconsistency." But he then proposes to solve these flaws by deputizing a small office within the Office of Management and Budget to reform and rationalize risk assessment throughout the federal government. For trenchant critiques, see Stephen F. Williams, Risk Regulation and Its Hazards, 93 Mich. L. Rev. 1498 (1995), and James L. Huffman, Justice Breyer's Case for Centralized Executive Government, 1995 Pub. Interest L. Rev. 167. See also W. Kip Viscusi, Fatal Trade-Offs (1992).
David Schoenbrod, Power Without Responsibility: How Congress Abuses the People Through Delegation (1993). Explains why Congress wants to avoid responsibility for the regulatory decisions of the federal government, and how Congress gets away with passing on the task to bureaucrats. Professor Schoenbrod concludes that this delegation of legislative authority-made possible by the impotence of the nondelegation doctrine, at least since the time of the New Deal-attenuates Congress's accountability and thereby contributes to the alienation and frustration felt by the public.
Gary Lawson, The Rise and Rise of the Administrative State, 107 Harv. L. Rev. 1231 (1994). To begin any study of administrative/regulatory law, it helps to understand something about the seriousness with which many scholars view the shortcomings and pitfalls of this field. For example, in this article Professor Lawson declares "The post-New Deal administrative state is unconstitutional, and its validation by the legal system amounts to nothing less than a bloodless constitutional revolution." He does not offer any "quick fixes" for this condition. Consider also Richard Stewart, Madison's Nightmare, 57 U. Chi. L. Rev. 335 (1990). Stewart argues that "the demands for national regulatory and spending programs have outstripped the capacity of the national legislative process to make decisions that are accountable and politically responsive to the general interest." The result is "Madison's Nightmare: a faction-ridden maze of fragmented and often irresponsible micropolitics within the government." Stewart criticizes the policy instruments chosen by the government to implement its regulatory schemes: "The same problems that have plagued the Soviet efforts at central management of the economy hamper American efforts to plan selected aspects of the economy through centralized regulations." A bit more optimistic than Lawson, Stewart offers a blueprint for "reconstitutive law" to address these shortcomings of the regulatory system.
Robert Rabin, Federal Regulation in Historical Perspective, 38 Stan. L. Rev. 1189 (1986). Traces the history of the federal regulatory regime from the Populist Era to what Rabin calls the "Public Interest Era," saying relatively little about the changes wrought by President Reagan. Concludes that the regulatory system "has grown by leaps and bounds, yet remains devoid of any coherent ideological framework." Also, the courts have failed to develop "a consistent approach to controlling agency discretion." While Professor Rabin is, arguably, rather too sanguine about this lack of coherence and consistency-he hails the regime's "pragmatism and flexibility"-his history is nonetheless useful, particularly in its weaving together regulatory policy decisions by Congress and the agencies with changes in administrative law dictated by the courts.
Cass Sunstein, Paradoxes of the Regulatory State, 57 U. Chi. L. Rev. 407 (1990). A good treatment of regulatory failures and an account of some reforms that might lead to a more efficient administrative state.
Richard, Epstein, Why the Modern Administrative State is Inconsistent with the Rule of Law, 3 NYU J. L & Liberty 491 (2008). Epstein outlines his disagreement with the assumption that administrative state officials armed with technical expertise and acting in good faith to advance the public interest can systematically outperform any system of limited government whose major function is to support and protect market institutions. Not only is technical expertise an overrated virtue, but the administrative state gives rise to a peculiar blend of bureaucratic rule and discretion that does not comport with the historical conception of a rule of law, and its central concern with the control of arbitrary power.
Administrative Law and the Courts
Jeremy Rabkin, Judicial Compulsions: How Public Law Distorts Public Policy (1989). This book presents the argument against judicial oversight of administrative agency decisions, which, according to Rabkin, frustrates the ideal of "energy in the Executive" and often leads to incoherent and inflexible policy.
Michael Herz, The Rehnquist Court and Administrative Law, 99 Nw. L. Rev. 297 (2004). A look at the Rehnquist Court's jurisprudence through the lens of administrative law. Prof. Herz argues that the Rehnquist Court is more deferential than its critics and supporters believe, particularly to the executive branch and in fields such as administrative law where the division between law and politics can be more clearly drawn.
Stephen F. Williams, Background Norms in the Regulatory State, 58 U. Chi. L. Rev. 419 (1991). An enlightening discussion of the differences between the common law and the regulatory state is contained in this review of Cass R. Sunstein, After the Rights Revolution: Reconceiving the Regulatory State (1990).
The Supreme Court's 1984 Chevron decision redefined the courts' relation to administrative agencies with respect to questions of law, and triggered a flood of commentary. See Kenneth W. Starr, Judicial Review in the Post-Chevron Era, 3 Yale J. on Reg. 283 (1986); Antonin Scalia, Judicial Deference to Administrative Interpretations of Law, 1989 Duke L.J. 511; Peter H. Schuck & E. Donald Elliott, To the Chevron Station: An Empirical Study of Federal Administrative Law, 1990 Duke L.J. 984; Laurence Silberman, Chevron-The Intersection of Law and Policy, 58 Geo. Wash. L. Rev. 821 (1990). For a later reflection on Chevron, see Thomas Merrill, Judicial Deference to Executive Precedent, 101 Yale L.J. 969 (1992). Professor Merrill argues that the predicted dramatic effects from Chevron have, for the most part, not come to pass, and offers an alternative to what he terms the decision's "draconian implications."
Lisa Schultz Bressman, Chevron's Mistake, 58 Duke L.J. 549 (2009). Bressman argues that the Chevron Doctrine functions based on a flawed presumption of legislative specific meaning. The presumption of a specific meaning does not match the reality of how Congress designs regulatory statutes. Congress is more likely to eschew specificity in favor of agency delegation under certain circumstances-- for example, if an issue is complex and if legislators can monitor subsequent agency interpretations through administrative procedures. Although Chevron recognizes such "delegating" factors, it fails to sufficiently credit them. This Article imagines what interpretive theory would look like for regulatory statutes if it actually incorporated realistic assumptions about legislative behavior. The theory would engage factors such as the complexity of the issue and the existence of administrative procedures as indications of interpretive delegation more satisfactorily than existing law does. In the process, it would produce a better role for courts in overseeing the delegation of authority to agencies.
Matthew C. Stephenson, Legislative Allocation of Delegated Power: Uncertainty, Risk, and the Choice between Agencies and Courts, 119 Harv. L. Rev. 1035 (2006). An examination of how legislators delegate their power, whether to an administrative agency or to the courts, and what factors influence them in making that choice. Prof. Stephenson stresses that agency decisions are more ideologically consistent during a time period but fluctuate more across time, and that court decisions are more consistent over time, even though they are more ideologically diverse during any given time period.
Richard Stewart, The Reformation of American Administrative Law, 88 Harv. L. Rev. 1667 (1975). One of the most obvious drawbacks of the administrative state is that government agencies are not politically accountable for their exercise of the powers delegated to them by Congress. Indeed, perhaps the central problem of administrative law can be stated as "How do we control agency discretion?" Traditional administrative law relied principally on judicial review of agency decisions for this control. But by the mid-1970s a string of judicial decisions required that public "participation" in agency decision making processes be promoted so as to better control agency discretion. Professor Stewart's article attacks this transformation of administrative law, arguing that the administrative process cannot practically be made into a "surrogate political process." Accordingly, the involvement of interest groups in agency proceedings ultimately fails as a general legitimating structure for agencies' discretionary actions.
Richard A. Epstein, No New Property, 56 Brooklyn L. Rev. 747 (1990). Challenging Goldberg v. Kelly, and its academic precursor, Charles Reich, The New Property, 73 Yale L.J. 733 (1964).
Henry Friendly, Some Kind of Hearing, 123 U. Pa. L. Rev. 1267 (1975). Judge Friendly's article provides some very pragmatic suggestions about how to deal with the Supreme Court's expansion of due process rights in the early 1970s.
Caleb Nelson, Adjudication in the Political Branches, 107 Colum. L. Rev. 559 (2007). Prof. Nelson examines the history of "the judicial Power of the United States" from Article III of the Constitution and concludes that "judicial power" was not coterminous with adjudicative authority. Instead, "judicial power" related only to protected rights, in contrast to more general privileges that could still be adjudicated outside the ring of "judicial power."
Thomas Miles and Cass Sunstein, Do Judges Make Regulatory Policy: An Empirical Investigation of Chevron, 73 U. Chi. L. Rev. 823 (2006). Miles and Sunstein present voting data from the Supreme Court and courts of appeals showing that the application of the Chevron framework is greatly affected by the judges' own convictions. Whatever Chevron may say about a judge's duty to defer to an agency interpretation, the data reveal a strong relationship between the justices' ideological predispositions and the probability that they will validate agency determinations. In The Real World of Arbitrariness Review, 75 U. Chi. L. Rev. 761, 2008. The authors aim to correct the lack of scholarly literature on the hard look doctrine and do so through an analysis of a large data set of all published appellate rulings from 1996 to 2006 involving review of decisions of the EPA and review of NLRB decisions either for arbitrariness or for lack of substantial evidence. The authors conclude that just like Chevron review, the hard look doctrine produces highly political outcomes. The findings offer a clear prediction for the future: when a judiciary consisting mostly of Democratic appointees confronts a conservative executive branch, the rate of invalidations will be unusually high, and so too when a judiciary consisting mostly of Republican appointees confronts a liberal executive branch.
John Manning, Textualism as a Non-Delegation Doctrine, 97 Colum. L. Rev. 673 (1997). This article critically analyzes the textualist judges' objections to legislative history and rerationalizes textualism as a special application of the nondelegation doctrine. Some judges routinely rely on a variety of extrinsic sources (agency rules, treatises, judicial opinions, etc.) to interpret ambiguous statutes, even though these sources do not reflect genuine congressional intent and are not subject to bicameralism and presentment. The article seeks to resolve this apparent problem by arguing that interpretive reliance on legislative history creates an opportunity for legislative self-delegation, contrary to the clear assumptions of the constitutional structure. This conflation of lawmaking and law declaration functions makes it far too attractive for Congress to bypass bicameralism and presentment, assigning the specification of legislative detail to committees and sponsors. Accordingly, this Article concludes that courts should not impute a committee's or sponsor's declaration of intent to Congress as a whole.
Thomas Merrill, Capture Theory and the Courts: 1967-1983, 72 Chi.-Kent L. Rev. 1039 (1997). Merrill sets out to explain the rise and fall of activist judicial control over the administrative state, focusing heavily on judicial assertiveness between 1967 and 1983. Merrill characterizes modern judicial deference as a product of a deeper and more generalized pessimism about the administrative state, and in particular, of a spreading disenchantment with all forms of activist government. The contemporary attitude seems to be that if nothing good can be expected to come from government, then perhaps the best we can do is to avoid wasting resources debating the rules. Thus, modern administrative common law often seems committed to making the rules as simple, mechanical, and common-law like as possible, in the hope that this will minimize the temptation to seek strategic advantage through further changes in the rules, and the deadweight loss that such a process of "rule churning" likely entails.
Administrative Law and Executive Power
Christopher C. DeMuth & Douglas H. Ginsburg, White House Review of Agency Rulemaking, 99 Harv. L. Rev. 1075 (1986). A defense of the unitary Executive as manifested in White House oversight of federal agency rulemaking through the review processes of the Office of Management and Budget.
Cynthia Farina, Statutory Interpretation and the Balance of Power in the Administrative State, 89 Colum. L. Rev. 452 (1989). While this article is critical of the unitary-Executive view, which questions the constitutional validity of the administrative state, it is one of the few recent critiques that seeks to state its case with a due regard for originalist methods of interpretation.
Thomas Merrill, Rethinking Article I, Section 1: From Nondelegation to Exclusive Delegation, 104 Colum. L. Rev. 2097 (2004). Merrill discusses the two postulates that underlie the legislative vesting clause of the Constitution. The first is the nondelegation doctrine, which says that Congress may not delegate legislative power. The second is the exclusive delegation doctrine, which says that only Congress may delegate legislative power. This Article explores the textual, historical, and judicial support for these two readings of Article I, Section 1, as well as the practical consequences of starting from one postulate as opposed to the other. The Article concludes that exclusive delegation is superior to the non-delegation doctrine, either in its present unenforced version, or if it were enforced more strictly. The exclusive delegation doctrine would reorient understanding of the allocation of legislative power in a way that provides a better fit with institutional realities, and yet would also preserve an important measure of exclusive power to Congress as the first branch of our national government.
Case Studies in Regulation
Geoffrey Miller, Public Choice at the Dawn of the Special Interest State: The Story of Butter and Margarine, 77 Calif. L. Rev. 83 (1989). For seventy-five years, dairy interests sought government protection from the competitive threat posed by oleomargarine. Professor Miller chronicles the first battle in this early rent-seeking war, which resulted in the passage of the federal Oleomargarine Act of 1886. A wonderful case study, and a good example of the explanatory power of public choice theory.
Jonathan R. Macey & Geoffrey P. Miller, Bank Failures, Risk Monitoring, and the Market for Bank Control," 88 Colum. L. Rev. 1153 (1988). States the case for curbing management self-dealing and excessive risk-taking through the market for corporate control rather than through government regulation. Professors Macey and Miller also state the case for bank liquidation as opposed to other forms of regulatory intervention in cases of bank failure.
Dara K. Cohen, Mariano-Florentino Cuéllar, and Barry R. Weingast, Crisis Bureaucracy: Homeland Security and the Political Design of Legal Mandates, 59 Stan. L. Rev. 673 (2006). The professors offer insight into how agencies interpret their legal mandates and use their administrative discretion through the example of the creation of the Department of Homeland Security.
Adrian Vermeule, Our Schmittian Administrative Law, 122 Harv. L. Rev. 1095 (2009). Vermeule draws from Carl Schmitt's thoughts on emergencies and legal black holes to draw insights into American administrative law. Part I gives background on Carl Schmitt and his thought. Part II suggests that administrative law is Schmittian, in the sense that it is built around a series of black holes and grey holes that are integral to its structure. Part III suggests that for practical and institutional reasons, administrative law cannot realistically be otherwise. These claims require clarification.
Internet resources: The federal Administrative Procedure Act is available through Cornell's Legal Information Institute at http://www.law.cornell.edu/uscode/5/ch5.html. The ABA's administrative procedure database is available at http://www.law.fsu.edu/library/admin.
Both the Code of Federal Regulations and the Federal Register are available on-line at the Government Printing Office homepage, http://www.access.gpo.gov/nara/cfr/cfr-table-search.html. The current Executive Order (12,866, signed September 30, 1993) providing for regulatory review by the Office of Management & Budget is available at http://www.whitehouse.gov/omb/inforeg/riaguide.html. For a database of recent economic analysis by federal agencies, see http://www.reginfo.gov/public/do/eoPackageMain.
Last updated October 2010