The abuse of state power in the USA
The unconstitutional public lobby regime
In Bureaucracy in America: The Administrative State’s Challenge to Constitutional Government, published by University of Missouri Press in 2017, Joseph Postell sheds much light on the process in which liberal advocacy groups since the 1960s and 1970s, sincerely but erroneously presenting themselves as public interest groups, have further undermined the constitutional principles of representative democracy. The phenomenon is the culmination of ideological and political tendencies since the beginning of the twentieth century. Said dynamics have contributed to a legitimation crisis in the American republic, inasmuch as many if not most citizens are aware that the U.S. state today is not a government of, by, and for the people, which the Founders intended to establish.
Postell, professor of political science at Hillsdale College, nicely presents the American constitutional principles of state administration: lawmaking by elected representatives, unity and responsibility in the executive, the separation of powers, and judicial review of administrative action. These principles include the concept of non-delegation, according to which the legislative branch cannot delegate its legislative power to the president or to administrative agencies in the executive branch. In essence, the Congress makes laws; the President and the executive branch administer them; and the judiciary interprets them, with particular emphasis on ensuring that the rights of the individual are not violated by the executive branch.
However, these principles do not guide American state administration today. Most policies today are enacted not by Congress and the President but by administrative agencies, with personnel not elected by the people. Moreover, the Congress has participated in this, delegating its legislative power to administrative agencies when it creates them. This has been sanctioned by Supreme Court decisions during the twentieth century, so much so that today even conservative Supreme Court justices, reluctant to overturn legal precedents established by their own Court, do not challenge this ongoing violation of the non-delegation principle. Justice Antonin Scalia wrote that the non-delegation principle cannot be restored by the courts, implying that only the Congress can do it.
When the Constitution mattered
Prior to the Civil War, the Congress avoided the creation of bureaucratic regulatory agencies that were removed from public opinion and oversight. Three principles guided state administration. (1) Discretionary policy should be made by officials directly elected by the people, such as legislators and some executive officials. (2) Judges and juries should review and enforce administrative decisions, based on laws that clearly specify illegal conduct. (3) Public administration should be guided by politics, that is, the political will of the people as expressed in elections. There was during the period a strict separation of powers involving the non-delegation of authority.
Congress avoided delegating legislative authority to the executive, and it “routinely settled matters of detail that could legitimately have been transferred to administrative officials.” Congress erred on the side of caution, careful to avoid delegating powers unconstitutionally to unelected bureaucrats. Administrative discretion was limited by specific statutory provisions.
In accordance with the view that elected representatives should direct state administration, the Congresses adopted the position that the officers of the administration of the executive branch were under the control and supervision of the president, serving as his agents. Congress maintained the unity and independence of the executive branch by vesting administrative authority in the president and placing him in a position to direct the affairs of every subordinate officer. The President was at the helm of the entire federal administration, directing it in accordance with laws enacted by the legislature. The process was balanced by judicial review of administration, subjecting administrating decisions to legal review, which was not challenged even by judges oriented to deference to the determinations of administrative agencies.
There was an explosion of administrative departments from 1860 to 1890. Even through Congress in this period granted wide discretion to administrators, in continued to follow the doctrine of the non-delegation of legislative power.
Conventional scholarship maintains that the Interstate Commerce Act of 1887 marked a turn to a commitment to an administrative state with an independent bureaucracy ruled by technical experts and specialists. Based on careful study of the Congressional debates, Postell concludes that this view is not correct. He maintains that in creating the Interstate Commerce Commission, the Congress did not intend to create a modern administrative state. The Act provides for the regulation of corporations with specific laws, not regulation of corporations by a Commission. Postell notes that “even supporters of the bill believed that the Interstate Commerce Act was not creating a powerful administrative bureaucracy.”
Accordingly, the passage of the Interstate Commerce Act should not be viewed as an embrace of “a progressive-style administrative bureaucracy.” It was a cautious reform aimed at investigating abuses, without violating established constitutional principles. The act prohibited certain corporate practices of “unfair competition” that had been central to the forging of trusts and monopolies, such as railroad rate discrimination, rebating, and unreasonable railroad rates. But the ICC was not granted the power to set railroad rates. And it had no enforcement power. When it found a violation of the law, it could request appropriate action by the U.S. Attorney, on the basis of its evidence.
Conventional scholarship maintains that opposition to the Interstate Commerce Act and the International Commerce Commission that it created was driven by a belief in laisse faire economic doctrine. Postell maintains that this view also cannot be sustained through a careful examination of debates. Opposition to the administrative state was not grounded in laissez-faire economics but in commitment to American constitutionalism and to the principle that federal regulation must occur in a constitutional framework that preserves individual rights, the separation of powers, and the rule of law.
The first Chair of the Interstate Commerce Commission, Thomas M. Cooley, sought to expand the limits of the Commission’s power, but he kept the ICC within constitutional boundaries. He developed a model of administrative practice that would limit as much as possible agency discretion in the application of laws enacted by the people’s representatives in the legislature. And he focused on non-coercive methods of regulation, such as appealing to the civic and patriotic duties of the corporate executives; and public education, so that the people could elect representatives with an orientation to enacting coercive laws when necessary. He believed that it was important to establish the ICC as a voice with moral authority in the political process, rather than an instrument of coercive governmental power.
In Cooley’s time, it was not yet known how the global elite would respond to the challenges posed by the emergence of monopoly capitalism, the rise of anti-colonial movements, and the pending crises of the world-system. We now know that they have responded with moral irresponsibility, such that coercion must now be applied. But Cooley had important insights. First, coercion must be applied with political intelligence, seeking to eliminate specific behaviors with negative consequences for the society. Secondly, necessary coercion must be applied through the rule of laws enacted by the representatives of the people, and not by unelected bureaucrats who are not accountable to the people and are neither in a social nor ideological sense representative of the people. Doing things in the right way, with attention to the long-term health of the decision-making process, is a necessary condition for governmental legitimacy.
The Emergence of the Administrative State
The Progressive Movement ushered in fundamental reforms in the American political system. On the one hand, it was able to attain reforms toward direct democracy, such as the direct election of U.S. Senators and the establishment of the referendum and the recall. On the other hand, progressives envisioned “an administrative state that rested on expertise rather than political accountability. Given the pace of technological and political progress, progressives argued, a modern administrative state needed to put experts in charge who would employ scientific expertise as opposed to following public opinion.” Thus, “Progressive reformers questioned the republican foundations of administrative law that had been in place for over a century. Republicanism, understood as the theory of government by consent through elected representatives, was seen by progressive reformers as undemocratic and outmoded.” They emphasized the establishment of democratic outcomes that were in the best interests of the people, as against emphasis on democratic procedures. They believed that a strict interpretation of the Constitution would render the government incapable of responding to modern needs.
In the elections of 1912, independent candidate and former President Theodore Roosevelt put forth a proposal for “New Nationalism,” which “essentially advocated a centralized administrative power to regulate the economy in the wake of industrialization.” Roosevelt maintained that the solution to the problem of industrialization and the concentration of industry lay in governing the large corporations through commissions. The proper method was not in breaking up monopolies but in using administrative tribunals to oversee them. What was needed was a federal commission to effectively control and regulate all big combinations, which would provide steady expert control.
In the 1912 elections, Democratic Party candidate Woodrow Wilson objected to Roosevelt’s proposal for regulation by economic commission. Even though he characterized himself as a progressive, Wilson insisted on the need to reform with careful consideration of the institutions established by the Constitution. Wilson’s proposal of “New Freedom,” roundly criticized by progressives, “was intended to preserve the constitutional system and obviate the need for centralized administration by offering an alternative approach to regulation.” Standards would be set forth in laws and statutes, and they would be administered through the executive branch and adjudicated in courts of law.
During the 1912 campaign, Wilson relentlessly attacked the New Nationalism’s proposal for commission-style government. He defended the capacity of independent citizens to govern themselves, without having to rely on experts and elites. He advocated for laws that would prohibit specific measures that the trusts used to gain monopolistic control, combining these laws with the creation of a commission that would assist with investigations and offer advice to the Department of Justice, but would not itself have legislative or judicial powers. Whereas Roosevelt argued that a regulatory commission would be needed because the rules defining prohibited conduct could not be put forth in advance, Wilson maintained that it was possible to put forth basic rules, by zeroing in on methods that corporations use to drive competitors out of business. Thus, for Wilson, it was a question of carefully written statutes combined with judicial enforcement through litigation, which in Postell’s view, was consistent with the core principles of American constitutionalism.
In 1913 and 1914, now President Wilson obtained Congressional approval for a series of measures that were consistent with his campaign proposals. The Federal Trade Commission Act of 1914 was illustrative. It provided that if the Federal Trade Commission had reason to believe that an entity was using unfair methods of competition, it could institute legal proceedings. Although the Act at first glance might appear to make the FTC an independent arbiter of trade, in fact the Congress retained political control over the Commission, and in addition, the FTC would have to enforce its findings through the Department of Justice and the courts. Thus, the FTC resembled earlier approaches to state administration.
Although the Wilson package provided the basis for the regulation of large corporations in accordance with Constitutional principles, its implementation required vigilance by the executive and legislative branches. World War I, in which the United States began to participate commercially in 1915, cast aside the political will for vigilance over corporate methods. The war industry created commercial possibilities, and unfettered exploitation of such possibilities had higher priority in public and political consciousness than vigilance concerning corporate methods of competition. Over time, the rising tide of progressivism made impossible the governmental regulation of the corporations through any means other than the regulatory commission, along the lines of Theodore Roosevelt’s 2012 proposal for New Nationalism.
The New Deal expanded the administrate state dramatically. The National Industry Recovery Act (NIRA) and the Agricultural Adjustment Act (AAA) “gave the government broad powers to plan and coordinate economic and agricultural activity and production.” The NIRA gave the president the power to enact “codes of fair competition,” which he delegated to various boards and commissions. The AAA authorized the Secretary of Agriculture to manage agricultural production in order to ensure price stability. New regulatory agencies were created, such as the Securities and Exchange Commission, the National Labor Relations Board, and the Federal Communications Commission. Legislative, executive, and judicial authority were now in the hands of executive agencies, constituting a fourth branch of independent regulatory commissions.
The rapid establishment of various commissions provoked resistance from the Supreme Court. In January 1935, the Court struck down a statute for violating the non-delegation doctrine. It maintained that the Congress had in effect delegated legislative authority to the president, inasmuch as it had failed to set standards to guide the president’s discretion, and it required no findings of fact by the president before acting. In May 1935, the Court again struck down section 3 of the NIRA for violating the non-delegation doctrine. It ruled that the section, in authorizing the president to establish “codes of fair competition,” had failed to define fair competition, thus leaving it to president to in effect create legislation.
FDR’s reaction to these court rulings was to seek legislative solutions. However, in Postell’s view, the resolutions were more formal than real, constituting nothing more than more carefully crafted language that established guidelines and required findings of fact. Postell maintains that the administrative state continued to expand, with Congress delegating legislative power to the executive branch, and the judicial branch sanctioning the violation of the non-delegation doctrine.
In the context of the expanding progressivism of the era, courts were increasingly deferential toward agencies, although many lawyers and judges were opposed to the tendency to reduce judicial review. Roscoe Pound, Dean of the Harvard Law School, was among the chief opponents of the administrative state. The 1938 ABA Report authored primarily by Pound decried the “administrative absolutism” of the New Deal. It proposed review boards in every department and agency, which was included in the Walter-Logan Act of 1939, along with measures for dramatically expanding judicial review. The Walter-Logan Act was vetoed by Roosevelt, which led to a compromise, the Administrative Procedure Act (APA) of 1946. The Congressional debate on the APA indicates that there was a consensus among the members of Congress that the administrative state had grown out of control and threatened the basic principles of constitutional government. Many saw the APA as a first step toward restoring constitutional government; although it was recognized that additional legislation would be needed. The APA was clearly understood by the members of Congress as broadening the scope of judicial review.
But Congressional hopes were not realized. The APA did not decisively reverse the New Deal tendency toward deference to agencies by courts. In spite of the APA, by the end of the 1950s, the regime of judicial deference was undisturbed.
The public lobby regime
Postell maintains that in the 1960s and 1970s there occurred a third wave of expansion of the administrative state and a revolution in administrative law. New agencies of social regulation were created, which were seeking not economic regulation, like the regulatory agencies of the Progressive Era and the New Deal, but regulatory agencies that deal with health, non-discrimination, and environmental protection, housed within executive departments.
During the period, the prevailing view among social reformers was that the regulatory agencies often are captured by the very firms they are empowered to control. Inasmuch as the experts are drawn from the firms they are supposed to regulate, the agency often adopts a pro-industry posture.
In the 1960s and 1970s, federal courts radically altered the administrative process by expanding judicial review in such a way as to give interest groups an active role in supervising administrative agencies, thereby checking the tendency of agencies to be captured by the industry that they are supposed to supervise. Liberals had pushed for laxer standards on standing to file suit, so that standing was extended to include ideological interest groups. As a result, little limit remained on standing rights; the entire population was in the “zone of interest” with respect to an agency ruling. As explained by Marc Allen Eisner, the goal was “to democratize the regulatory system and guarantee advocacy groups a continuous presence in policy implementation.”
Thus, the advocacy groups developed a strategy of influencing the administrative process through courts sympathetic to their purposes. This departs from the traditional progressive approach that called for judicial deference to the agencies.
With the expansion of judicial review and influenced by liberal reformers, the federal courts increased procedural requirements that the agencies were expected to follow, sometimes creating procedural requirements not specified by Congress.
Accordingly, in the 1970s, liberal reformers re-politicized administrative theory. They rejected the Progressives’ earlier faith in scientific administration. In their view, the goal of regulatory policy was not to find the scientifically correct answer to policy problems. Rather, agency decision making was seen as a process of adjusting competing claims of various private interests affected by agency policy. In this process, the key actors were constructing a surrogate political process that included representation of a wide range of affected interests.
Thus, in the 1960s and 1970s, the courts were aggressive in reviewing agency actions and decisions. The expanded judicial review process led to an explosion of interest group activity in the administrative state. Numerous interest and advocacy groups were organized. Within agencies, power shifted to lawyers providing legal advice.
For example, courts were aggressive in defining the content of free and adequate public education for handicapped children. Actions of school districts often were overturned in relation to handicapped students. According to Postell, the courts were substituting their own judgement for the judgments of public educators. And in spite of a Supreme Court ruling calling for judicial restraint, the lower courts continued to exercise independent judgment concerning whether school administrators had provided an adequate education.
Courts intervened in administrative affairs in other issues as well. For example, with respect to interpretation of 1964 Civil Rights Act, which states that “No person in the United States shall, on the basis of race, color, or national origin, be excluded from participation in, be denied benefits of, or be subjected to discrimination under, any program or activity receiving federal financial assistance.” In Adams v. Richardson, the Court ruled that the Office of Civil Rights was required to interpret this principle to mean that previously segregated schools must assign students selectively to different schools in order to maintain racial balance. As Jeremy Rabkin wrote in Judicial Compulsions, the litigation was driven by the frustration of civil rights advocacy groups with the failure of the Office of Civil Rights to sustain the expectations generated by an extremely activist administrative policy after the Civil Rights Act was passed. Concerned with the possibility of inaction by the agency, the advocacy groups turned to a litigation strategy through which the courts would impose their own interpretation of the law against that of the agency. Postell maintains that the advocacy groups perceived agencies as “captured” if they were not pursuing sufficiently liberal policies.
The new administrative state is participatory, as interest groups and courts are empowered to supervise the administrative process. In this new model, there is greater access to administrators, constituting a new form of participation in government, combined with a capacity to enforce through the judiciary, to make the bureaucracy more responsive to public demands. Bureaucratic discretion is limited by courts and interest groups.
This is seen as a new form of participatory democracy that, according to the new theory of state administration, ensures fidelity to organic statutes. It ensures that programs do not reflect merely the perspective of the office within the agency that initially drafts the proposal. It prevents bias in favor of special interests. It ensures, according to the new theory, that decisions are made rationally on the basis of facts as against private interests and political concerns. In this view, judges are seen above petty and parochial interests, and they are the guardians of the administrative process. There is in this perspective a sharp distinction between private and public interests, and the judges are the guardians of the latter.
In this concept of participatory democracy, advocacy groups are referred to as “public interest groups.” There is in this liberal conception no separation of administration from politics, a separation that is seen as a threat to the public interest. Administration is politicized through litigation by “public interest” advocacy groups.
This form of participatory democracy takes the place of the traditional representative institutions established by the Constitution. People participate through their voluntary membership in interest groups, such as unions, environmental organizations, corporations, or public interest groups.
Postell views this form of participatory democracy as a liberal and left strategy during the period. Courts and citizen groups were more liberal than agencies, and the judiciary was viewed by liberals as the most trustworthy branch. The courts became a mechanism for enforcing the liberal view of the public interest.
Central to the liberal strategy has been the issue of standing, as noted above. Interested parties could sue in environmental controversies because of broad rules concerning standing to sue. Virtually any interested party could sue, including an array of public interest lawyers, acting as self-appointed private attorneys general. “Liberal legal scholars advocated loose standards for standing because it allows interest groups to claim to represent the public to challenge agencies that might be captured by private interests.” This is a shift of the role of the court from a protector of individual rights to a vindicator of public values. This constitutes a form of legitimating the administrative state which has lost democratic structures in the shift to bureaucratic decision making.
The new state administration model, Potsell observes, is based on the premise that public values often stand in opposition to private rights and values, which is why courts must cooperate with public interest groups to prevent agencies from being captured by private interests. The ironic result is that “administrative law becomes captured by private citizens acting on their private preferences, in the name of the public interest,” so that special interests and values are privileged over the general interests.
In what Richard A. Harris and Sidney M. Milkis call the “public lobby regime,” it is assumed that public lobby groups and courts are representative of public and community interests, with a higher moral standing than private and pecuniary interests. The dynamics of the public lobby regime occur outside the supervision of the president and the Congress; they take the place of the structures of representative democracy established by the Constitution.
The tepid conservative counterrevolution
Postell maintains that conservative Supreme Court justices have challenged certain dimensions of the public lobby regime, but they have not done so consistently. The clearest area in which the administrative state goes unchallenged concerns its violation of the non-delegation doctrine, one of the most vulnerable pillars of the regime. Only Justice Thomas has questioned the legitimacy of delegating power to the bureaucracy. Rather, led by Scalia, conservatives on the court have sought to accommodate the administrative state. In a dissenting opinion in Mistretta v. United States, Scalia wrote that “while the doctrine of unconstitutional delegation is unquestionably a fundamental element of our constitutional system, it is not an element that is readily enforceable by the courts.”
The predominant attitude among conservatives on the Court since 1980, Postell maintains, has been “accommodation to the administrative state and the [Court’s] precedents that give it constitutional legitimacy, but dissent when the Court goes beyond those precedents to uphold more dramatic departures from traditional constitutional structure.” He observes that “while many justices on the Court were uneasy about the rise of the administrative state, they were only willing to limit its expansion rather than consider overturning precedents that provided for its foundation.”
The conservative members of the Court defer to the legislature and its intent in creating the regulatory agencies. In their view, the Court should be controlled by Congressional intent. This implies that the abolition of the public policy regime and the bureaucratic state and the restoration of constitutional principles is in the hands of the elected representatives of the people in the legislature. Of course, as we ought to be aware, the electoral process itself contains structural elements that are unfavorable to the election of representatives who are delegates of the people and their interests. Which does not mean that a struggle for the renewal of the American Republic cannot take this obstacle into account, and create strategies for overcoming it.
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