Lobbyists as imperfect agents: Implications for public policy in a pluralist system

Harvard Journal on Legislation

Volumn 47, Issue 1, 2010, Pages 1-20

  Stephenson, Matthew C ^a   Jackson, Howell E ^a  

^a HARVARD LAW SCHOOL   (United States)

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EID: 77949676652     PISSN: 0017808X     EISSN: None     Source Type: Journal    
DOI: None     Document Type: Article

References (137)

1. See, e.g., DANIEL A. FARBER & PHILIP P. FRICKEY, LAW AND PUBLIC CHOICE: A CRITICAL INTRODUCTION 12-15 (1991).
2. Classic statements of the pluralist perspective on policymaking include ARTHUR F. BENTLEY, THE PROCESS OF GOVERNMENT: A STUDY OF SOCIAL PRESSURES (1908)
3. JAMES M. BUCHANAN & GORDON TULLOCK, THE CALCULUS OF CONSENT (1962)
4. ROBERT A. DAHL, A PREFACE TO DEMOCRATIC THEORY (1956)
5. ROBERT A. DAHL, WHO GOVERNS? DEMOCRACY AND POWER IN AN AMERICAN CITY (1961)
6. EARL LATHAM, THE GROUP BASIS OF POLITICS: A STUDY IN BASING-POINT REGULATION (1952)
7. DAVID B. TRUMAN, THE GOVERNMENTAL PROCESS: POLITICAL INTERESTS AND PUBLIC OPINION (1951)
8. More recent treatments of interest group pluralism in political science and law include JEFFREY M. BERRY, THE INTEREST GROUP SOCIETY (2d ed. 1989)
9. DANIEL A. FARBER & PHILIP P. FRICKEY, LAW AND PUBLIC CHOICE: A CRITICAL INTRODUCTION (1991)
10. KAY LEHMAN SCHLOZMAN & JOHN T. TIERNEY, ORGANIZED INTERESTS AND AMERICAN DEMOCRACY (1986)
11. Arthur T. Denzau & Michael C. Munger, Legislators and Interest Groups: How Unorganized Interests Get Represented, 80 AM. POL. SCI. REV. 89 (1986)
12. William N. Eskridge Jr., Politics Without Romance: Implications of Public Choice Theory for Statutory Interpretation, 74 VA. L. REV. 275 (1988)
13. William C. Mitchell & Michael C. Munger, Economic Models of Interest Groups: An Introductory Survey, 35 AM.
14. See BUCHANAN & TULLOCK, William C. Mitchell & Michael C. Munger, Economic Models of Interest Groups: An Introductory Survey, 35 AM note 2
15. MANCUR OLSON, THE LOGIC OF COLLECTIVE ACTION: PUBLIC GOODS AND THE THEORY OF GROUPS (1965)
16. MANCUR OLSON, THE RISE AND DECLINE OF NATIONS (1982)
17. Sam Peltzman, Toward a More General Theory of Regulation, 19 J.L. & ECON. 211 (1976)
18. Richard A. Posner, Theories of Regulation, 5 BELL J. ECON. & MGMT. SCI. 22 (1974)
19. George J. Stigler, The Theory of Economic Regulation, 2 BELL J. ECON. & MGMT. SCI. 3 (1971).
20. See Gary Becker, A Theory of Competition Among Pressure Groups for Political Influence, 98 Q.J. ECON. 371 (1983)
21. Herbert Hovenkamp, Legislation, Well-Being, and Public Choice, 57 U. CHI. L. REV. 63 (1990)
22. Mark Kelman, On Democracy-Bashing: A Skeptical Look at the Theoretical and "Empirical" Practice of the Public Choice Movement, 74 VA. L. REV. 1999 (1988)
23. Donald Wittman, Why Democracies Produce Efficient Results, 97 J. POL. ECON. 1395 (1989).
24. Compare BUCHANAN & TULLOCK, Donald Wittman, Why Democracies Produce Efficient Results, 97 J. POL. ECON. 1395 (1989) note 2, at 78, with DAHL, A PREFACE TO DEMOCRATIC THEORY, note 2, at 15.
25. See, e.g., Richard A. Smith, Interest Group Influence in the U.S. Congress, 20 LEGIS. STUD. Q. 89 (1995).
26. The most sustained analysis of this lobbyist-client agency problem is Rogan Kersh, State Autonomy & Civil Society: The Lobbyist Connection, 14 CRITICAL REV. 237 (2000). Kersh emphasizes that lobbyists are not mere "transmission belts" who represent their clients' interests in the legislative process; rather, he points out, lobbyists have their own interests-both material and with respect to public policy-that may differ from those of their clients. The current analysis differs from Kersh's in that Kersh's principal interest is in the implications of lobbyist autonomy for theories of state autonomy and civil society, whereas this Essay is interested primarily in whether lobbyist-client agency slack may have systematic consequences for public policy. On this question, the legal literature contains numerous scattered references to how the divergence between lobbyist interests and client interests may affect policy outcomes, but little sustained attention.
27. See Scott Baker & Kimberly D. Krawiec, The Penalty Default Canon, 72 GEO. WASH. L. REV. 663, 676 (2004) (suggesting that a client-lobbyist agency problem explains why groups fail to object when a statute is incomplete and shifts responsibility to courts or administrative agencies); Steven P. Croley, Theories of Regulation: Incorporatpossibility that environmental and consumer advocacy groups represent the interests of their leadership rather than the interests of their members or the public at large)
28. Clayton P. Gillette, Rules, Standards, and Precautions in Payment Systems, 82 VA. L. REV. 181, 201-03 (1996) (claiming, in general, that an agency problem means interest group leaders will sometimes push legislation that benefits the leaders more than their constituents, perhaps by focusing on securing visible and popular benefits at the expense of less salient but more important benefits)
29. Michael S. Greve, Business, the States, and Federalism's Political Economy, 25 HARV. J.L. & PUB. POL'Y 895, 922 (2002) (arguing that a principal-agent problem between lobbyists and their constituents may explain why both environmentalists and the business community might prefer a federal permitting program to a decentralized, state-level regulatory system, even if the latter would be better both for business and the environment)
30. Robert W. Hahn & Robert N. Stavins, Incentive-Based Environmental Regulation: A New Era from an Old Idea?, 18 ECOLOGY L.Q. 1, 25 (1991) (arguing that the resistance of industry lobbyists to marketbased environmental regulations stems, in part, from a principal-agent problem because the lobbyists fear changes to the status quo that would diminish the value of their expertise, even if these changes would benefit their clients)
31. Thomas W. Hazlett, Physical Scarcity, Rent Seeking, and the First Amendment, 97 COLUM. L. REV. 905, 931-32 & n.103 (1997) (arguing that an agency problem between non-profit broadcasters and their lobbyists explains why nonprofits supported the licensing scheme adopted by the 1927 Radio Act, even though it was not in their interest)
32. Samuel Issacharoff & Daniel R. Ortiz, Governing Through Intermediaries, 85 VA. L. REV. 1627, 1652-54 (1999) (observing that although citizens can make use of "superagents," including organized interest groups, to monitor their political representatives, these superagents might themselves be subject to agency problems)
33. Nathaniel O. Keohane et al., The Choice of Regulatory Instruments in Environmental Policy, 22 HARV. ENVTL. L. REV. 313, 332-33 (1998) (asserting that a principal-agent problem exists between an interest group's members and the professional staff who engage in lobbying activities)
34. Manik Roy, Pollution Prevention, Organizational Culture, and Social Learning, 22 ENVTL. L. 189, 205 (1992) (observing, in a case study of an environmental advocacy group, that the group's lobbyist had tremendous discretion and independence from the group's contributors)
35. Henry A. Span, Public Choice Theory and the Political Utility of the Takings Clause, 40 IDAHO L. REV. 11, 35 n.101 (2003) (noting that lobbyists claiming to represent diffuse groups may exhibit an agency problem)
36. Nathan Witkin, Interest Group Mediation: A Mechanism for Controlling and Improving Congressional Lobbying Practices, 23 OHIO ST. J. ON DISP. RESOL. 373, 402 & n.258 (2008) (arguing that an agency problem may lead lobbyists to oppose interest group mediation mechanisms that might benefit their clients)
37. Todd J. Zywicki, Environmental Externalities and Political Externalities: The Political Economy of Environmental Regulation and Reform, 73 TUL. L. REV. 845, 877-80 (1999) (arguing that the environmental groups that lobby policymakers have organizational interests that are separate from, and sometimes conflict with, the interest in environmental protection, and that this explains their preference for centralized, command-and-control regulation)
38. David Freeman Engstrom, The Lost Origins of American Fair Employment Law: Regulatory Choice and the Making of Modern Civil Rights, 1943-1964 (Mar. 3, 2009) (unpublished manuscript, on file with the Harvard Journal on Legislation) (suggesting that the organizational interests of mainstream civil rights groups influenced these groups' decisions to push for administrative, rather than legal, solutions to employment discrimination problems in the 1940s and 1950s, despite evidence that a courtcentered strategy might be more effective).
39. See Derrick A. Bell Jr., Serving Two Masters: Integration Ideals and Client Interests in School Desegregation Litigation, 85 YALE L.J. 470 (1976)
40. John C. Coates IV, Explaining Variation in Takeover Defenses: Blame the Lawyers, 89 CAL. L. REV. 1301 (2001)
41. John C. Coffee, Understanding the Plaintiff's Attorney: The Implications of Economic Theory for Private Enforcement of Law Through Class and Derivative Actions, 86 COLUM. L. REV. 669 (1986)
42. John C. Coffee, The Unfaithful Champion: The Class Attorney as a Monitor in Shareholder Litigation, 48 LAW & CONTEMP. PROBS. 5 (1985)
43. James D. Dana, Jr. & Kathryn E. Speir, Expertise and Contingent Fees: The Role of Asymmetric Information in Attorney Compensation, 9 J.L. ECON. & ORG. 349 (1993)
44. Winand Emons, Expertise, Contingent Fees, and Insufficient Attorney Effort, 20 INT'L REV. L. & ECON. 21 (2000)
45. Ronald J. Gilson & Robert H. Mnookin, Disputing Through Agents: Cooperation and Conflict Between Lawyers in Litigation, 94 COLUM. L. REV. 509 (1994)
46. Bruce L. Hay, Contingent Fees and Agency Costs, 25 J. LEGAL STUD. 503 (1996)
47. Bruce L. Hay, Effort, Information, Settlement, Trial, 24 J. LEGAL STUD. 29 (1995)
48. Thomas Miceli, Do Contingent Fees Promote Excessive Litigation?, 23 J. LEGAL STUD. 211 (1994)
49. Geoffrey P. Miller, Some Agency Problems in Settlement, 16 J. LEGAL STUD. 189 (1987)
50. A. Mitchell Polinsky & Daniel L. Rubinfeld, Aligning the Interests of Lawyers and Clients, 5 AM. L. & ECON. REV. 165 (2003)
51. Alison Watts, Bargaining Through an Expert Attorney, 10 J.L. ECON. & ORG. 168 (1994).
52. See Alison Watts, Bargaining Through an Expert Attorney, 10 J.L. ECON. & ORG. 168 (1994) note 8 and accompanying text.
53. See JOHN R. WRIGHT, INTEREST GROUPS AND CONGRESS 22-30 (1996). For an online database of lobbyists for interest groups and other entities, see the Center for Responsive Politics compilation of lobbying reports filed with the Senate's Office of Public Records. Center for Responsive Politics, Lobbying Database, http://www.opensecrets.org/lobby/index. php (last visited Nov. 1, 2009). In this Essay, the authors use the term "lobbyist" expansively to cover not only individuals or entities that must register as lobbyists under the relevant federal lobbying statutes, but also all those who are employed by interest groups to monitor government activities, to formulate strategies to influence government behavior, and to advocate on interest groups' behalf before government bodies (including legislatures, administrative agencies, and in some cases, courts). Thus this definition of lobbyists would include much of the work of lawyers and other professionals, including consultants and public relations firms. These findings would also be applicable to lobbying at other levels of government.
54. See ANTHONY J. NOWNES, TOTAL LOBBYING 12 (2006)
55. WRIGHT, ANTHONY J. NOWNES, TOTAL LOBBYING 12 (2006) note 10, at 9-11.
56. See JOHN P. HEINZ ET AL., THE HOLLOW CORE 64-66 (1993)
57. NOWNES, JOHN P. HEINZ ET AL., THE HOLLOW CORE 64-66 (1993) note 11, at 43.
58. For a useful discussion of trade associations, as well as an analysis of why firms might sometimes prefer this mode of lobbying activity, see Sanford C. Gordon & Catherine Hafer, Endogenous Trade Associations in Regulatory Politics (Oct. 15, 2009) (unpublished manuscript, on file with authors).
59. For example, according to Center for Responsive Politics compilations, the U.S. Chamber of Commerce retains in-house lobbyists and also hires outside lobbying firms. Center for Responsive Politics, Lobbying Spending Database-U.S. Chamber of Commerce 2009, http://www.opensecrets.org/lobby/clientsum.php?lname=US+Chamber+of+Comme rce&year=2009 (last visited Nov. 1, 2009).
60. See SCOTT H. AINSWORTH, ANALYZING INTEREST GROUPS 120-21 (2002)
61. NOWNES, SCOTT H. AINSWORTH, ANALYZING INTEREST GROUPS 120-21 (2002) note 11, at 16-19, 26-28
62. WRIGHT, SCOTT H. AINSWORTH, ANALYZING INTEREST GROUPS 120-21 (2002) note 10, at 88-113.
63. See NOWNES, SCOTT H. AINSWORTH, ANALYZING INTEREST GROUPS 120-21 (2002) note 11, at 31-32, 44-46.
64. See Robert H. Salisbury et al., Who You Know Versus What You Know: The Uses of Government Experience for Washington Lobbyists, 33 AM. J. POL. SCI. 175 (1989) (discussing value of lobbyist knowledge of substance policy and decision-making processes).
65. See Span, Who You Know Versus What You Know: The Uses of Government Experience for Washington Lobbyists, 33 AM. J. POL. SCI. 175 (1989) note 7, at 35.
66. See Who You Know Versus What You Know: The Uses of Government Experience for Washington Lobbyists, 33 AM. J. POL. SCI. 175 (1989). at 51-52.
67. See Kersh, Who You Know Versus What You Know: The Uses of Government Experience for Washington Lobbyists, 33 AM. J. POL. SCI. 175 (1989) note 7, at 242
68. see also Kersh, Who You Know Versus What You Know: The Uses of Government Experience for Washington Lobbyists, 33 AM. J. POL. SCI. 175 (1989). at 244-45 (noting that many lobbyists spend more time explaining issues to their clients than getting instructions from their clients and that lobbyists are responsible for identifying many of their clients' interests for them).
69. See DAVID SCHOENBROD, POWER WITHOUT RESPONSIBILITY: HOW CONGRESS ABUSES THE PEOPLE THROUGH DELEGATION 59 (1993)
70. E. Donald Elliott et al., Toward a Theory of Statutory Evolution: The Federalization of Environmental Law, 1 J.L. ECON. & ORG. 313, 331 (1985).
71. SCHOENBROD, Toward a Theory of Statutory Evolution: The Federalization of Environmental Law, 1 J.L. ECON. & ORG. 313, 331 (1985) note 21, at 59.
72. See Kersh, Toward a Theory of Statutory Evolution: The Federalization of Environmental Law, 1 J.L. ECON. & ORG. 313, 331 (1985) note 7, at 245.
73. Cf. David Austen-Smith & Jeffrey Banks, Electoral Accountability and Incumbency, in MODELS OF STRATEGIC CHOICE IN POLITICS 121 (Peter C. Ordeshook ed., 1989) (stating that it is difficult to ascribe responsibility for any particular policy outcome to a particular legislator)
74. Scott Ashworth & Ethan Bueno de Mesquita, Delivering the Goods: Legislative Particularism in Different Electoral and Institutional Settings, 68 J. POL. 168 (2006)
75. John Ferejohn, Incumbent Performance and Electoral Control, 50 PUB. CHOICE 5 (1986); Susanne Lohmann, An Information Rationale for the Power of Special Interests, 92 AM. POL. SCI. REV. 809 (1998).
76. See HEINZ ET AL., Incumbent Performance and Electoral Control, 50 PUB. CHOICE 5 (1986); Susanne Lohmann, An Information Rationale for the Power of Special Interests, 92 AM. POL. SCI. REV. 809 (1998) note 12, at 67.
77. But see Kersh, Incumbent Performance and Electoral Control, 50 PUB. CHOICE 5 (1986); Susanne Lohmann, An Information Rationale for the Power of Special Interests, 92 AM. POL. SCI. REV. 809 (1998) note 7, at 254 n.9 (finding, in a sample of lobbyists, that the amount of lobbyist discretion seemed to depend on individual characteristics of the lobbyists themselves, not on whether the lobbyists represent single firms or larger associations, or on whether the lobbyists are in-house employees or outside "hired guns").
78. For a recent, public example of such divergence, see Lisa Lerer, Nike to Quit Chamber Post in Climate Protest, POLITICO, Sept. 30, 2009, http://www.politico.com/news/stories/0909/ 27739.html.
79. See HEINZ ET AL., Lisa Lerer, Nike to Quit Chamber Post in Climate Protest note 12, at 59-79
80. NOWNES, Lisa Lerer, Nike to Quit Chamber Post in Climate Protest note 11, at 54-55.
81. Thomas Susman & Margaret Martin, Contingent Fee Lobbying: Inflaming Avarice or Facilitating Constitutional Rights, 31 SETON HALL LEGIS. J. 311 (2007).
82. See Roy, Contingent Fee Lobbying: Inflaming Avarice or Facilitating Constitutional Rights, 31 SETON HALL LEGIS. J. 311 (2007) note 7, at 205.
83. Cf. Alec Walen, Criticizing the Obligatory Acts of Lawyers: A Response to Markovits's Legal Ethics from the Lawyer's Point of View, 16 YALE J.L. & HUMAN. 1, 39 (2004) (noting how lawyers may come to internalize their client's perspective).
84. One contributing factor to this dynamic is that a lobbyist may have her own personal policy preferences, and these may affect how hard the lobbyist works to pursue certain goals. A lobbyist may have a stronger incentive to work hard if she agrees with the client's goals than if she does not. See Kersh, Criticizing the Obligatory Acts of Lawyers: A Response to Markovits's Legal Ethics from the Lawyer's Point of View, 16 YALE J.L. & HUMAN. 1, 39 (2004) note 7, at 249-50. This may have public policy consequences with respect to particular issue areas that go beyond distortions in effort levels, but these consequences are for the most part idiosyncratic.
85. Gillette, Criticizing the Obligatory Acts of Lawyers: A Response to Markovits's Legal Ethics from the Lawyer's Point of View, 16 YALE J.L. & HUMAN. 1, 39 (2004) note 7, at 202.
86. Gillette, Criticizing the Obligatory Acts of Lawyers: A Response to Markovits's Legal Ethics from the Lawyer's Point of View, 16 YALE J.L. & HUMAN. 1, 39 (2004) note 7, at 202.
87. That is, the lobbyist-client relationship may entail a multi-task moral hazard problem. See Bengt Holmstrom & Paul Milgrom, Multitask Principal-Agent Analyses: Incentive Contracts, Asset Ownership, and Job Design, 7 J.L. ECON. & ORG. 24 (1991).
88. KEVIN W. HULA, LOBBYING TOGETHER: INTEREST GROUP COALITIONS IN LEGISLATIVE POLITICS 95 (1999) (identifying reputation as an "important source of political capital").
89. Cf. STEVE JOHN, THE PERSUADERS: WHEN LOBBYISTS MATTER 43 (2002) (noting the importance of long-term relationships to lobbyists).
90. Cf. Bell, THE PERSUADERS: WHEN LOBBYISTS MATTER 43 (2002) note 8 (making the analogous point with respect to public interest lawyers).
91. This implies that, insofar as government entities have their own institutional interests, which do not necessarily reflect the interests of their various constituencies or the general public, lobbyists who sympathize or identify with these entities may "inherit" some of their particular institutional interests. These inherited preferences, in turn, may sometimes diverge from the interests of lobbyists' clients.
92. For an overview of federal earmarks, see Robert Porter & Sam Walsh, Earmarks in the Federal Budget Process (Apr. 1, 2008) (unpublished student paper), available at http://www.law.harvard.edu/faculty/hjackson/budget.php).
93. See Jason Dana & George Loewenstein, A Social Science Perspective on Gifts to Physicians from Industry, 290 J. AM. MED. ASS'N 252 (2003)
94. Don A. Moore & George Loewenstein, Self-Interest, Automaticity, and the Psychology of Conflict of Interest, 17 SOC. JUST. RES. 189 (2004).
95. Actions in blatant conflict with client interests would usually be easily observable at the time of the lobbying and thus subject to direct principal control. In closer cases, there will often be plausible arguments that the interests of lobbyists and clients are aligned in most material respects. In addition, even when a lobbyist's position clearly did not serve a client's interests in retrospect, it is always possible that the position was taken in error and with the client's express and knowing acquiescence. There are, however, some cases where the totality of circumstances suggests that at least some lobbyists are not pursuing client interests. For example, during the Clinton Administration, the Treasury Department proposed the creation of a new council of financial regulators to resolve inter-agency disputes. The proposal was opposed by nearly every financial services lobbying group on the grounds that the council would disadvantage the interests of each client group. See Dean Anason, Financial Council's Power, Scope, Makeup Criticized, AM. BANKER, June 27, 1997, at 3. While the proposal would have undoubtedly shifted the nexus of regulatory powers, it seems implausible that every group (many of which had diametrically opposed economic interests) would have been injured by the proposed reforms. It is more likely that the lobbyists were reflexively steering their clients away from a new and unfamiliar regulatory structure.
96. See OLSON, THE LOGIC OF COLLECTIVE ACTION, note 3
97. OLSON, THE RISE AND DECLINE OF NATIONS, note 3.
98. A possible example here would be the prominent role that the U.S. Chamber of Commerce has taken in opposing the Obama administration's proposal to create a Consumer Financial Protection Agency. See Perspectives on the Consumer Financial Protection Agency: Hearing Before the H. Comm. on Financial Servs., 111th Cong. (2009) (statement of Andrew J. Pincus, Partner, Mayer Brown LLP), available at http://www.house.gov/apps/list/hearing/ financialsvcs_dem/pincus_-_chamber.pdf. While some aspects of the proposed legislation may have created concerns for certain segments of the Chamber's membership, the group's wholesale and well-funded attack on many aspects of the administration's proposal-including provisions aimed primarily at regulated banks-seems unlikely to have been the kind of governmental action that would have been a major concern to the Chamber's hundreds of thousands of business and organizational members.
99. See also Lisa Lerer, White House Plan: Neuter the Chamber, POLITICO, Oct. 19, 2009, http://www.politico.com/news/stories/1009/ 28445.html (chronicling disputes between the Obama administration and the Chamber of Commerce on financial regulatory reform and other issues).
100. As Part II suggests, the agency problem might sometimes lead a lobbyist to exert more effort than the principal desires. For example, high-profile lobbying successes may confer private benefits on the lobbyists themselves, such as personal satisfaction or future employment opportunities. In these cases, one might observe an opposite asymmetry in which large, diffuse groups lobby more aggressively. Even though this increases the odds that these lobbying efforts will be successful, the result is still a welfare loss for the principals, who, if fully informed, would have allocated their resources differently.
101. See Kersh, note 7, at 248-49 (noting that lobbyists can generate more business by convincing clients to pay attention to issues the clients had previously ignored or were unaware of than by merely completing an assignment and waiting for repeat business).
102. For example, when federal banking agencies began to focus on the potential problem of mortgage underwriting several years ago, the Mortgage Bankers Association ("MBA") and many other financial services industry lobbying groups opposed the effort, defending the adjustable rate mortgages as "tried and true credit options" that "helped millions achieve the dream of home ownership." See Letter from John Robbins, Chairman, MBA, to Sen. Chris Dodd (D-Conn.), Chairman, Comm. on Banking, Hous., & Urban Affairs (Jan. 8, 2007), available at http://www.mortgagebankers.org/files/Advocacy/TestimonyandCommentLeters/ MBA Letter_NewGuidanceonNonTraditionalMortgageProductRisk_1-8-2007.pdf. These efforts succeeded in the short-term by diluting the severity of banking agency initiatives, but in retrospect the success did not advance the longer-term interests of the MBA's membership, which suffered greatly when the housing market burst shortly thereafter. A more nuanced approach to the emerging problem of mortgage underwriting might have better protected the interests of MBA members but would have been politically risky for groups like the MBA and therefore arguably less attractive ex ante.
103. An extensive literature has considered the analogous problem in the context of electoral control of politicians, where the voter may be uncertain how much of the observed outcome is due to the politician's efforts and how much is due to factors beyond the politician's control. Austen-Smith & Banks, note 24, at 121.
104. See SCHOENBROD, note 21, at 59
105. Peter H. Aranson et al., A Theory of Legislative Delegation, 68 CORNELL L. REV. 1, 7, 56-62 (1982-83)
106. Morris P. Fiorina, Legislative Choice of Regulatory Forms: Legal Process or Administrative Process?, 39 PUB. CHOICE 33, 46-52 (1982)
107. Mark A. Graber, The Nonmajoritarian Difficulty: Legislative Deference to the Judiciary, 7 STUD. AM. POL. DEV. 35 (1993)
108. Eli M. Salzberger, A Positive Analysis of the Doctrine of Separation of Powers, or: Why Do We Have an Independent Judiciary?, 13 INT'L REV. L. & ECON. 349, 361-66 (1993).
109. See DAVID EPSTEIN & SHARYN O'HALLORAN, DELEGATING POWERS (1999)
110. JERRY L. MASHAW, GREED, CHAOS, AND GOVERNANCE 145-48 (1997)
111. Eric A. Posner & Adrian Vermeule, Interring the Nondelegation Doctrine, 69 U. CHI. L. REV. 1721 (2002).
112. This bias is built into the structure of federal government, where enactment of legislation typically requires favorable referral of legislative proposals by the relevant committees to the parent chambers, reconciliation of any differences between House and Senate versions, the affirmative vote of both chambers, plus a presidential signature (or the two-thirds supermajorities in each chamber necessary to overcome a presidential veto). This makes it relatively easier to block than to enact legislation. See, e.g., William N. Eskridge, Jr. & John Ferejohn, The Article I, Section 7 Game, 80 GEO. L.J. 523, 528-33 (1992)
113. Roberta Romano, The Political Dynamics of Derivative Securities Regulation, 14 YALE J. ON REG. 279 (1997).
114. See, e.g., Aranson et al., The Political Dynamics of Derivative Securities Regulation, 14 YALE J. ON REG. 279 (1997) note 48, at 7-21.
115. See Richard A. Posner, Statutory Interpretation: In the Classroom and in the Courtroom, 50 U. CHI. L. REV. 800, 811 (1983).
116. See JAMES M. LANDIS, THE ADMINISTRATIVE PROCESS (1938)
117. Jonathan Bendor & Adam Meirowitz, Spatial Models of Delegation, 98 AM. POL. SCI. REV. 293 (2004)
118. David Epstein & Sharyn O'Halloran, The Nondelegation Doctrine and the Separation of Powers: A Political Science Approach, 20 CARDOZO L. REV. 947 (1999)
119. David B. Spence & Frank Cross, A Public Choice Case for the Administrative State, 89 GEO. L.J. 97 (2000-01).
120. See SCHOENBROD, A Public Choice Case for the Administrative State, 89 GEO. L.J. 97 (2000-01) note 21, at 59
121. Aranson et al., A Public Choice Case for the Administrative State, 89 GEO. L.J. 97 (2000-01) note 48, at 7, 56-62
122. Fiorina, A Public Choice Case for the Administrative State, 89 GEO. L.J. 97 (2000-01) note 48, at 46-52.
123. See HEINZ ET AL., A Public Choice Case for the Administrative State, 89 GEO. L.J. 97 (2000-01) note 12, at 95-98 (finding that many of the lobbyists who participate regularly in lobbying Congress also represent their clients before executive branch agencies).
124. A possible example of this phenomenon can be seen in a provision of the GrammLeach-Bliley Act of 1999, which expanded the powers of banks to engage in securities activities but left unresolved the appropriate degree of Securities and Exchange Commission ("SEC") oversight of bank securities activities. This left the issue of oversight to the joint resolution of the SEC and the banking agencies. The agencies then spent seven full years implementing new regulations in this area, failing to reach a final decision until Congress adopted another piece of legislation mandating adoption of regulation by September 2007. See Definitions of Terms and Exemptions Relating to the "Broker" Exception for Banks, 72 Fed. Reg. 56,514 (Oct. 3, 2007) (codified in scattered sections of 12 C.F.R. pt. 218 and 17 C.F.R. pts. 240, 247).
125. See JOEL D. ABERBACH, KEEPING A WATCHFUL EYE: THE POLITICS OF CONGRESSIONAL OVERSIGHT (1990)
126. Kathleen Bawn, Political Control Versus Expertise: Congressional Choices About Administrative Procedures, 89 AM. POL. SCI. REV. 62 (1995)
127. David Epstein & Sharyn O'Halloran, Administrative Procedures, Information, and Agency Discretion, 38 AM. J. POL. SCI. 697 (1994)
128. Mathew D. McCubbins et al., Structure and Process, Politics and Policy: Administrative Arrangements and the Political Control of Agencies, 75 VA. L. REV. 481 (1989)
129. Mathew D. McCubbins et al., Administrative Procedures as Instruments of Political Control, 3 J.L. ECON. & ORG. 243 (1987)
130. Mathew D. McCubbins & Thomas Schwartz, Congressional Oversight Overlooked: Police Patrols Versus Fire Alarms, 28 AM. J. POL. SCI. 165 (1984)
131. Barry R. Weingast & Mark J. Moran, Bureaucratic Discretion or Congressional Control? Regulatory Policymaking by the Federal Trade Commission, 91 J. POL. ECON. 765 (1983).
132. See MORRIS P. FIORINA, CONGRESS: KEYSTONE OF THE WASHINGTON ESTABLISHMENT 46-49, 71 (1977)
133. Fiorina, CONGRESS: KEYSTONE OF THE WASHINGTON ESTABLISHMENT 46-49, 71 (1977) note 48, at 46-52.
134. The ongoing debates over regulatory reform in the financial services industry offer many possible illustrations of this phenomenon, as many trade groups oppose consolidation of financial supervision in the United States. See, e.g., GOV'T ACCOUNTABILITY OFFICE, FINANCIAL REGULATION: A FRAMEWORK FOR CRAFTING AND ASSESSING PROPOSALS TO MODERNIZE THE OUTDATED U.S. FINANCIAL REGULATORY SYSTEM (2009) (including comments from the American Bankers Association), available at http://www.gao.gov/new.items/d09216.pdf.
135. Again the on-going financial regulatory reform debates offer possible examples. One of the most contentious aspects of the Obama administration's proposals for consumer protection is the restoration of state supervisory authority of federally chartered depository institutions, such as national banks or federally chartered thrifts. Lobbyists for the financial services industry have generally opposed this aspect of the administration's proposals, preferring to maintain uniform national standards. See, e.g., Letter from Steve Bartlett, President and CEO, The Fin. Servs. Roundtable, to Members of the Comm. on Banking, Hous., and Urban Affairs (July 8, 2009), available at http://www.fsround.org/policy/pstatements/pdfs/FSRReg.REformLtrtoSen ateBanking.pdf.
136. See Mark J. Roe, Delaware's Half-Life, STAN. L. REV. (forthcoming 2010) (manuscript at 1, on file with authors).
137. See Leo E. Strine, Jr., Delaware's Corporate-Law System: Is Corporate America Buying an Exquisite Jewel or a Diamond in the Rough? A Response to Kahan and Kamar's Price Discrimination in the Market for Corporate Law, 86 CORNELL L. REV. 1257, 1268-70 (2000-01).