Let me begin by apologizing for the delay and by thanking the JREG crew and, of course, Chris Walker, for hosting this symposium and putting together a remarkable roster of essayists. The breadth and depth of the essays are a testament to the strength and vitality of the administrative law community. What’s more, they reflect our community’s generosity and collegiality. So a hearty thanks to all.
It would require another book-length project—or two or three—to respond fully to these rich essays. Given the fact that I’m not quite committed to writing Constitutional Coup Volumes 2 and 3 just yet, I’m going to use this space to address just a couple of the questions, suggestions, and challenges posed by each of the essayists.
Jeff Pojanowski’s review (“Anti-Privatization as a Second-Best Strategy”) is full of probative and provocative insights—and folks should certainly read Jeff’s Michigan Law Review essay. Among other things, Jeff suggests that critics of the administrative state who would like to limit federal power—but not dismantle the administrative state en toto—consider my theory of an administrative separation of powers.
My theory is, to be clear, agnostic on the question of how big and rangy the welfare state should be. And while I personally support a big and rangy welfare state, I agree with Jeff that my policy proposals to strengthen the administrative separation of powers (and thus engender greater administrative friction) might well result in fewer federal regulatory interventions—and correspondingly enable greater private ordering and/or invite states and localities to pick up some of the regulatory slack.
Jeff also suggests that critics of administrative government (who, again, appreciate that tearing down the administrative state is neither politically likely nor necessarily a responsible approach to governing in the twenty-first century) may find reason to look favorably on approaches such as the Chief Justice’s “this far and no further” partial accommodation in the Free Enterprise case. My constitutional lines in the sand are, not surprisingly, different from the Chief’s, though in some instances my lines are even less accommodating than are his. Consider, for example, the deep concerns I express in the book about independent agencies writ large as well as about entities such as Amtrak (which Aaron Nielson’s essay picks up on).
Last, Jeff’s essay invites thinking about the differences between decentralized and devolved regulation. Jeff stresses, with good reason, the potential virtues of having devolved—state and local—solutions to address market failures and whatnot. If Jeff is making claims about the proper role of the states vis-à-vis the feds, I’m not sure my book has much to say. But if what really troubles Jeff, and others like him, is that federal regulatory decisions are crafted by small coteries of Beltway types, then my call for bolstering an administrative separation of powers should help. A robust administrative separation of powers will have a centrifugal pull on federal policymaking. While the agency heads (and many contractors) are firmly enveloped in the Beltway, civil servants and members of civil society are more likely to be scattered throughout the United States. So, amplifying their voices, as my “reinforcing rivalrous administration” aims to do, may well have an effect of ensuring more local concerns and issues are accounted for in the federal regulatory decisionmaking process. (Here I would also commend readers to David Fontana’s excellent work on federal decentralization.)
Daniel Hemel’s smart and thoughtful review (“In Praise of Privatization”) posits that “it is neither practicable nor desirable to do away with privatization entirely,” that privatization is “a necessary and welcome feature of our distinctly American welfare state,” and that there are plenty of big problems with a wholly “insourced state” that should make us look upon privatization more favorably (or at least with less antipathy).
Daniel raises important points, and I think they do good work in clarifying the reach and goals of my project. For these purposes, a few of the book’s claims bear underscoring.
First, the critical distinction I draw between what responsibilities need, and need not be, performed by the State turns on the degree to which those responsibilities entail the exercise of sovereign policymaking or policy-implementing discretion. As a matter of constitutional law, I am okay with private providers of State supported/guaranteed student loans, housing units, medical or educational services, and the like—so long as the services (and service providers themselves) are subject to close State regulation. In other words, I’m fine with the government working with private hospitals, private insurance companies, and private landlords; but I want the government setting policy for those private entities, at least when and where those entities deal with whatever subset of their clients come to them via the State.
Daniel says that those landlords and doctors still make all sorts of crucial decisions. I agree. In the book I say “[n]otwithstanding the general prohibition on privatizing inherently governmental responsibilities, the default position had long been to contract out whenever and wherever possible. Clearly, we need to switch the default. There should now be a rebuttable presumption against outsourcing—such that [government] officials bear the burden of justifying why they are not insourcing a given task.” (208) Path-dependency, history, demonstrated high-quality private service provision, and the overall structure of our political economy may well support maintaining the quasi-outsourced status quo. My guess is Daniel will find this wiggle room—and corresponding concessions to historical contingencies—unsatisfying. But, among other things one could point out, most of the examples that Daniel introduces entail responsibilities that were never fully folded into the public administrative arena of what I call pax administrative. Thus, the challenges those examples present are both different from and bigger than those this book zeroes in on.
Second, Daniel worries about intensive federal regulation of, for instance, the University of Chicago and other institutions that are “among the American Republic’s great strengths.” But regulation doesn’t necessarily mean micro-managing. And, more to the point, not every school is the University of Chicago. (Daniel makes the excellent point that we need a robust societal sector independent from both the State and the market. He’s totally right, but I must point out the way in which extensive public-private partnerships have long eroded the independence of that otherwise independent sector. Taking federal money—just like taking Walmart money—may come with strings attached.)
Third, government employees may not, simply by being employed by the State, satisfy the conditions I establish for truly public governance. For purposes of ensuring a well-functioning administrative separation of powers, I’m especially worried that at-will rank-and-file government employees aren’t altogether different from contractors. (Indeed, that’s my very critique of efforts to reclassify civil servants as at-will employees.) This decoupling of the State and government employees does, to be clear, raise intriguing questions. Among them, might private institutions or private employees of private institutions be constituted in ways that support or prove coextensive with the administrative separation of powers? Here one may think about Jody Freeman’s “public-ization” claims, essentially proposing ways to equip contractors with the ethos (and I’d add the bureaucratic safeguards) of public service. As I suggested in my book and elsewhere, I have some doubts about the feasibility of the “public-ization” agenda. For these purposes, I want to be clear that government employment is not a sufficient—and conceivably not a necessary—condition for something like an administrative separation of powers to work.
Fourth, I’m not advocating state ownership or nationalization, as evidenced by the concerns I raise about the federal bailout—specifically, the federal government’s use of its equity ownership stake to dictate regulatory reforms. Government as a direct market participant raises all sorts of questions and concerns (some of which I address in a soon-to-be published article in the University of Pennsylvania Law Review). For here, it suffices to say that the government’s use of its commercial clout to engineer regulatory outcomes is certainlys problematic.
Sam Halabi’s smart and challenging essay (“Constitutional Coup, Privatization, and the Federal False Claims Act”) is perhaps a fitting bookend to Daniel Hemel’s. Daniel wants me to come to terms with the inevitability—and desirability—of at least some privatization. Sam, for his part, is pulling me in the opposite direction. He thinks I am too lenient when it comes to more pedestrian forms of privatization.
First, I appreciate this push. I’m rarely pushed in the direction Sam is nudging me. And, in many respects, challenges from that flank trouble me more. Second, I appreciate Sam’s emphasis on the False Claims Act, and the interesting, important role false claims litigation plays in both checking and further enabling privatized government.
My quick and no doubt not-fully-satisfying answer is that the outsourcing of ministerial State responsibilities doesn’t threaten the administrative separation of powers. That said, the risk of fraud, abuse, and mismanagement is very real (and already well-documented) even in those more mundane contexts where privatization doesn’t trigger constitutional concerns.
Chris Walker, in his generous and challenging essay (“That One Last Time…”), is troubled by a constitutional theory that lacks grounding in the text and structure of the “actual constitution.” I readily grant the lack of a textual foundation; and I appreciate that this is a conversation stopper for textualists! But I beg to differ when it comes to structure.
For me, the Constitution is all about checks and balances, which I don’t think can be reduced to, as Ian Millhiser put it in his Take Care review, a specific or “precise allocation of those powers.” (We can disagree about what’s sufficiently specific, but by my lights the Constitution is regularly insufficiently specific when it comes to the precise allocation of power among the three great branches. To paraphrase Justice Scalia’s quip in Mead: buy stock in Youngstown Category II.)
On my reading, the Constitution contemplates multidimensional separations of powers complementing and reinforcing the explicit tripartite scheme of triangulated power among the Congress, the president, and the judiciary. In addition to the also-quite-explicit (and also not-fully-prescribed) federalism dynamic, there is the all-important public-private divide, the Church-State divide, and the civilian-military divide. Motivating all of those additional lines of division is an underlying commitment to checking and balancing power.
To be sure, there is no express constitutional contemplation of the balance that should be struck in administrative governance. But if we are going to have an administrative state and if we want to reconcile that administrative state with overarching, transcendent constitutional commitments, the rough framework I’ve sketched—based largely on what we’ve long had on the books—seems entirely fitting.
As I suggested in response to Daniel, there is always the possibility of another administrative arrangement that works—that is, an alternative scheme that also satisfies the structural commitments of our constitutional system. But absent such other arrangement, then I think all three pillars of the administrative separation of powers as presently identified legitimize the administrative state and thus need to remain in place. That’s one of the reasons why I’m as firmly against independent agencies as I am against the disbanding or defanging of the civil service. In the former case, the agency heads are too untethered from the President—and potentially insufficiently rivalrous with the career staff. And, in the latter, the converse is true, with the newly at-will rank-and-file workforce insufficiently rivalrous with the presidentially appointed agency heads.
Again, I get that my formulation doesn’t do any work to satisfy textualists. But I invite those who go beyond the text of the Constitution to consider the administrative separation of powers as faithful to and coextensive with the overarching political theory and design of a republic marked by multidimensional systems of checks and balances.
Jon D. Michaels is a Professor of Law at UCLA School of Law.
This post is part of a symposium reviewing Constitutional Coup: Privatization’s Threat to the American Republic, a new book by Jon D. Michaels, Professor of Law at UCLA School of Law. All of the posts can be read here.