It’s worth taking some time here to note the passing in January of one of the great scholars of regulation and public policy, Martha Derthick (emerita of the University of Virginia Department of Politics). Nice remembrances can be found here, here, and here .
Derthick’s work roamed widely through American politics, but of particular relevance to a blog on regulatory affairs is her work on bureaucratic politics. The capstone of her efforts in this field may well have been her book The Politics of Deregulation, co-authored with Paul Quirk and published by Brookings in 1985. The central argument of that book remains well worth our attention today, some 30 years hence.
The immediate context for The Politics of Deregulation was the stunning deregulatory overhaul that swept through the federal bureaucracy beginning in the mid-1970s. Commercial airlines, trucking, telecommunications, natural gas—these and other industries were exposed to competitive forces from which they had been shielded since the New Deal and before. Most interesting to Derthick was the utter failure of reigning theories in political science to explain these shifts. The most ballyhooed innovation in the field in the preceding years had been the so-called “economic theory of regulation,” which portrayed regulation not as the product of government’s efforts to serve the public interest, but as something captured by industry and designed primarily for its own benefit. In light of this theory’s ascendance, the deregulatory movement came as a very rude awakening. Derthick & Quirk wrote:
What makes our cases … of surpassing interest to a political analyst is that some of the most politically potent of American industries, in collaboration with organized labor, fought as hard as they could to protect their industries—and lost.
Political scientists would have been unlikely to foresee the defeat of the industries in these cases; and like the economists, they would also have been unlikely to foresee the willingness of regulatory agencies to engage in deregulation. (p.12)
“Unlikely” was putting the matter politely. As she did throughout her career, Derthick was calling a trendy new paradigm to the carpet. And she did so in a way that redirected analytical attention towards a domain that political scientists are often loathe to consider: towards the “The Politics of Ideas,” as she and Quick titled the book’s concluding chapter. A crucial explanatory variable in the story of deregulation, they wrote, was that “elite opinion converged in support of reform” (p. 238).
Still today, political scientists, regulatory scholars of other stripes, journalists, and even judges are quick to analyze regulatory developments solely in materialist terms. Stories are often narrated in terms of economic interests and not much else. Modes of analysis premised upon “rational actors” commonly define rationality, implicitly or explicitly, in terms of economic benefit. But “What’s the Matter With Kansas?” is a mystery only if you ignore the potency of ideas.
The notion that ideas can exert a pull quite independent of economic considerations is one worth keeping on the front burner for regulatory scholars. Certainly patterns of thought, argument, and intellectual development are not the whole regulatory story, as Derthick’s corpus would colorfully reveal, but neither can they be ignored. Crass reductions of policy debates not only risk glaring oversights, but also tend towards the impoverishment of public debate more generally. Powerful economic interests will always speak loudly and wield political influence, but some of the most dramatic changes in course—as exemplified by deregulation—must also be analyzed, and perhaps ultimately answered, within the realm of ideas.