Administration by treasury

Minnesota Law Review

Volumn 95, Issue 1, 2011, Pages 187-243

  Zaring, David ^a  

^a UNIVERSITY OF PENNSYLVANIA   (United States)

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EID: 79955868569     PISSN: 00265535     EISSN: None     Source Type: Journal    
DOI: None     Document Type: Article

References (459)

1. See Eric Dash & Andrew Ross Sorkin, In Largest Bank Failure, U. S. Seizes, Then Sells, N. Y. TIMES, Sept. 26, 2008, at A1, available at 2008 WLNR 18286005 (describing the circumstances surrounding Treasury's engineering the sale of Washington Mutual to J. P. Morgan Chase for $1.9 billion);
2. Megan Davies & Joseph Giannone, JPMorgan to Buy Bear Stearns for $2 a Share, REUTERS, Mar. 17, 2008, available at http://www.reuters.com/ article/idUSN 1671008920080317 (describing the takeover of Bear Stearns by J. P. Morgan as having "the backing" of the Treasury);
3. Robin Sidel et al., WaMu Is Seized, Sold Off to J. P. Morgan, in Largest Failure in U. S. Banking History, WALL ST. J., Sept. 26, 2008, at A1, available at http://online.wsj.com/article/SB12223841 5586576687.html (describing the sale of Washington Mutual);
4. Andrew Ross Sorkin, In Sweeping Move, Fed Backs Buyout and Wall St. Loans, N. Y. TIMES, Mar. 17, 2008, at A1, available at 2008 WLNR 5189440 (describing the sale of Bear Stearns to J. P. Morgan Chase as "done at the behest of the Fed and the Treasury Department").
5. See Charles Duhigg et al., As Crisis Grew, a Few Options Shrank to One, N. Y. TIMES, Sept. 8, 2009, at A1, available at 2008 WLNR 17004722 (describing the Treasury takeover of Fannie Mae and Freddie Mac)
6. Rebecca Christie & Dawn Kopecki, Paulson Engineers U. S. Takeover of Fannie, Freddie, BLOOMBERG. COM, Sept. 7, 2008, http://www.bloomberg.com/apps/ news? pid=20601087&sid=ajcw4yxxPGJ8.
7. The Lehman Brothers bankruptcy was the largest bankruptcy in U. S. history. Sam Mamudi, Lehman Folds with Record $613 Billion Debt, MARKETWATCH, Sept. 15, 2008, http://www.marketwatch.com/story/lehman-folds-with- record-613-billion-debt;
8. Yalman Onaran & Christopher Scinta, Lehman Files Biggest Bankruptcy Case as Suitors Balk, BLOOMBERG. COM, Sept. 15, 2008, http://www.bloomberg.com/ apps/news?sid=awh5hRyXkvs4& pid=20601087. Washington Mutual's failure was the largest bank failure in U. S. history.
9. Sidel et al., supra note 1;
10. Ari Levy & Elizabeth Hester, WaMu Assets Sold to JPMorgan in Record Bank Failure, BLOOMBERG. COM, Sept. 26, 2008, http://www.bloomberg.com/apps/ news?pid=20601103&sid=aVA8ErWOAjmI.
11. See Gary Lawson, Burying the Constitution Under a TARP, 33 HARV. J. L. & PUB. POL'Yx 55, 57(2010) (using the Troubled Asset Relief Program (TARP) as an example of the unconstitutionality of modern administrative law);
12. Simon Johnson, The Quiet Coup, THE ATLANTIC, May 2009, at 46, 52-53 available at http://www.theatlantic.com/magazine/archive/2009/05/the-quiet-coup/ 7364/(arguing that banks captured the policymaking process during the financial crisis and that the Treasury Department and Federal Reserve engaged in "late-night, backroom dealing");
13. Eric A. Posner & Adrian Vermeule, Crisis Governance in the Administrative State: 9/11 and the Financial Meltdown of 2008, at 11
14. (Univ. of Chi. Law Sch., John M. Olin Law & Economics Working Paper No. 440;
15. Univ. of Chi. Law Sch., Public Law and Legal Theory Working Paper No. 244;
16. Harvard Law Sch.: Pub. Law & Legal Theory Paper Series, Harvard Public Law Working Paper No. 08-50;
17. Harvard Law Sch.: Program on Risk Regulation Research Paper Series, Paper No. 09-04, 2008), available at http://ssrn.com/abstract=1301164 (stating that some of Treasury's actions during the financial crisis were probably not legal).
18. See Joe Nocera & Edmund L. Andrews, Running a Step Behind as a Crisis Raged, N. Y. TIMES, Oct. 23, 2008, at A1, available at 2008 WLNR 20148298 (""Ben said, "Will you go to Congress with me?"' said Mr. Paulson, referring to the Federal Reserve chairman, Ben S. Bernanke. 'I said: "Fine, I'm your partner. I'll go to Congress."'").
19. Id.
20. See Steven Davidoff, The 'Compromises' in the Bailout Bill, DEALBOOK (Sept. 29, 2008, 10:15 AM), http://dealbook.blogs.nytimes.com/2008/09/29/the- compromises-in-the-bailout-bill/.
21. Treasury urged Congress to pass a law whereby "[d]ecisions by the Secretary pursuant to the authority of this Act" should be "non-reviewable and committed to agency discretion, " and accordingly could "not be reviewed by any court of law or any administrative agency." Text of Draft Proposal for Bailout Plan, N. Y. TIMES, § 8, Sept. 20, 2008, http://www.nytimes.com/2008/09/21/business/21draftcnd.html (providing the text of the proposal). Nor was there any provision, at least initially, for reporting to Congress itself on how the money was spent.
22. Id.
23. Davidoff, supra note 7.
24. See infra Part II (describing Treasury's handling of the financial crisis).
25. See Nocera & Andrews, supra note 5 (characterizing the original bailout plan, which was drawn up by Treasury with little outside input, as "poorly conceived and unworkable").
26. Neither, for that matter, did Congress itself or the Congressional Budget Office play much of a role in vetting the legislation. See David M. Herszenhorn, Bush Signs Bill, N. Y. TIMES, Oct. 4, 2008, at A1, available at 2008 WLNR 18884174 (describing Congress taking two weeks to approve the $700 billion bailout package);
27. Lori Montgomery & Paul Kane, Bush Enacts Historic Financial Rescue; House Passes Plan by Wide Margin, but Stocks Keep Falling, WASH. POST, Oct. 4, 2008, at A01 (stating that Congress spent two weeks to approve the bill and emphasizing that the bill gave Treasury broad powers).
28. Nicholas Bagley & Richard L. Revesz, Centralized Oversight of the Regulatory State, 106 COLUM. L. REV. 1260, 1267(2006) (describing the persistence of OMB review of major regulations throughout presidential administrations since President Reagan first established OMB).
29. See Posner & Vermeule, supra note 4, at 23 (describing Congress's delegation of broad powers to the Executive and the sweeping executive proposals in times of crisis).
30. Id. at 14 (discussing the Treasury and the Fed's "flexible reading of the 1932 law, " which they interpreted to give them the authority to bail out AIG).
31. Administrative Procedure Act, 5 U. S. C. §§ 551-559, 701-706 (2006).
32. See generally Kristin E. Hickman, Coloring Outside the Lines: Examining Treasury's (Lack of) Compliance with Administrative Procedure Act Rulemaking Requirements, 82 NOTRE DAME L. REV. 1727(2007).
33. As Carl McFarland observed when the APA was being promulgated: [I]f you were a bright young law student walking down the corridor in your law school and saw a set of books labeled "Treasury Decisions" you would probably pass them by if you[] were looking for Treasury regulations, because the word "decisions" usually means determinations in particular cases. But in the Treasury Department they call a general rule a "decision. "
34. Carl McFarland, Analysis of the Federal Administrative Procedure Act, in THE FEDERAL ADMINISTRATIVE PROCEDURE ACT AND THE ADMINISTRATIVE AGENCIES 16, 19-20 (George Warren ed., 1947).
35. It was not subject to such review before the implementation of the administrative process encapsulated in the 1987 Paperwork Reduction Act, also unconventional for an agency. William F. Funk, The Paperwork Reduction Act: Paperwork Reduction Meets Administrative Law, 24 HARV. J. ON LEGIS. 1, 37(1987);
36. see also Executive Office Appropriations Act of 1987, Pub. L. No. 99-500, § 101 (m), 1986 U. S. C. C. A. N. (100 Stat. 1783) 309, 317 (excluding OMB review of regulations of the Bureau of Alcohol, Tobacco and Firearms of the Treasury Department);
37. John V. N. Philip, Note, The Paperwork Reduction Act in United Steelworkers of America v. Pendergrass: Undue Restriction and Unrealized Potential, 89 COLUM. L. REV. 920, 923(1989) (discussing how new procedures under the Act require previously exempt agencies to consult with the OMB). Even then, Treasury and the IRS disputed OMB's oversight to the point of a within-the-executive-branch deployment of a legal process to force it to be more conciliatory. Memorandum Op. for the Counsel to the Vice President & Counsel to the Dir., Office of Mgmt. & Budget, 6 Op. O. L. C. 388, 388-89 (1982);
38. see also Harold H. Bruff, Presidential Management of Agency Rulemaking, 57 GEO. WASH. L. REV. 533, 552-62 (1989) (suggesting that old-line cabinet departments such as State and Treasury had the clout to beat OMB when it came to a dispute).
39. Moreover, OMB has since been told to tread carefully when working with Treasury to sort through tax expenditures. U. S. GOV'T ACCOUNTABILITY OFFICE, GAO/GGD/AIMD-94-122, TAX POLICY: TAX EXPENDITURES DESERVE MORE SCRUTINY 97(1994).
40. See generally Ronald Cass, Allocation of Authority Within Administrative Agencies: Theory and Empirical Analysis, 66 B. U. L. REV. 1(1986) (describing the use of administrative law judges).
41. Indeed, it did so between the Civil War and the 1970s.
42. See Guy Munsch, Restoring and Modernizing the U. S. Treasury Building: An Overview and Three Case Studies, 33 APT BULL.: J. PRESERVATION TECH. 23, 23-29 (2002).
43. See Hickman, supra note 17, at 1732-35 (describing the general rulemaking requirements for agencies imposed by the APA).
44. U. S. GOV'T ACCOUNTABILITY OFFICE, GAO-03-929, OMB'S ROLE IN REVIEWS OF AGENCIES' DRAFT RULES AND THE TRANSPARENCY OF THOSE REVIEWS 7-8 (2003).
45. See Jerry L. Mashaw, Administration and "The Democracy": Administrative Law from Jackson to Lincoln, 1829-1861, 117 Yale L. J. 1568, 1666(2008) (explaining that during the Jacksonian era "much, if not most, oversight and control of... administrative action originated within bureaus and departments, " and that "Treasury regulated its relationships with state banks and with the sub-Treasuries by contract and circular, largely unaided (and occasionally derailed) by congressional legislation").
46. See MARY L. HINSDALE, A HISTORY OF THE PRESIDENT'S CABINET 44-45 (1911). For further discussion
47. see Frank B. Cross, Executive Orders 12, 291 and 12, 498: A Test Case in Presidential Control of Executive Agencies, 4 J. L. & POL. 483, 486-88 (1988).
48. See also Elizabeth Lee Thompson, Reconstructing the Practice: The Effects of Expanded Federal Judicial Power on Postbellum Lawyers, 43 AM. J. LEGAL HIST. 306, 308-09 (1999) (describing Treasury's control of all Southern commodities following the Civil War).
49. Gautham Roa, Sailors' Health and National Wealth, COMMON-PLACE (Oct. 2008), http://www.historycooperative.org/journals/cp/vol-09/no-01/rao/.
50. Stephen Skowronek has observed, albeit in a very different context, that "[m]odern American state building successfully negotiated a break with an outmoded organization of state power. The modern American state represents an internal governmental reconstruction worked out through incremental political reform." STEPHEN SKOWRONEK, BUILDING A NEW AMERICAN STATE 285(1982). Treasury has been performing its own Skowronekian mission a century after the administrative state he described was built. In that sense, Treasury's incremental evolution into discretionary areas has, in the end, created an agency a sea change apart from ordinary administrative law. Of course, Skowronek found the development to push at the outer bounds of constitutionality: "The major constructive contribution of the New Deal to the operations of the new American state lay in the sheer expansion of bureaucratic services and supports.... [T]he New Deal turned bureaucracy itself into the extraconstitutional machine so necessary for the continuous operation of the constitutional system."
51. Id. at 289.
52. For more on this, see Gary Lawson, The Rise and Rise of the Administrative State, 107 HARV. L. REV. 1231, 1231(1994) ("The post-New Deal administrative state is unconstitutional, and its validation by the legal system amounts to nothing less than a bloodless constitutional revolution. "). Others characterize the impetus behind the legislative announcement as nothing more than the usual sorts of battles between conservatives and liberals over policy choices.
53. See, e.g., George B. Shepherd, Fierce Compromise: The Administrative Procedure Act Emerges from New Deal Politics, 90 NW. U. L. REV. 1557, 1561(1996) (arguing that the enactment was spurred by conservatives' fear of overreaching by F. D. R.'s New Deal agencies and that only when the Supreme Court began refusing to strike down New Deal proposals in 1937 "did the reform proposals receive broad public interest").
54. See Steven M. Davidoff & David Zaring, Regulation by Deal: The Government's Response to the Financial Crisis, 61 ADMIN. L. REV. 463, 473-512 (2009) (describing Treasury's actions during the 2008 financial crisis as facilitating and making deals).
55. See infra Part I. C.3.b (describing Treasury's expanded role in monitoring criminals and tax evaders).
56. See infra Part I. C.2 (explaining how Treasury's international operations evade many of the typical administrative constraints).
57. See supra notes 29-30.
58. See infra notes 60-67 and accompanying text (showing that Treasury is party to far fewer suits than other agencies).
59. See infra Part I. C.1.a (describing bank regulation as a collaborative process).
60. See Mashaw, supra note 24, at 1669-84 (showing that American administrative procedure was quite elaborate at the beginning of the Republic even though there was not yet a modern conception of judicial review);
61. Jerry L. Mashaw, Recovering American Administrative Law: Federalist Foundations, 1787-1801, 115 YALE L. J. 1256, 1319-37 (2006) (describing the historical role of the courts and judicial review in administrative law).
62. The Department of the Treasury, Department of War, and Department of State were established by Congress during George Washington's tenure as the first President of the United States. BRYON GIDDENS-WHITE, OUR GOVERNMENT: THE PRESIDENT AND THE EXECUTIVE BRANCH 13(2006).
63. Jacob Goldstein, Reminder: Medicare, Medicaid Are Gobbling Up the Budget, WALL ST. J. HEALTH BLOG (Feb. 2, 2010, 8:47 AM), http://blogs.wsj.com/health/ 2010/02/02/reminder-medicare-medicaid-are-gobbling-up-the-budget/;
64. see infra notes 258-61 and accompanying text.
65. See, e.g., Lawson, supra note 4, at 57-58.
66. See, e.g., David B. Spence & Frank Cross, A Public Choice Case for the Administrative State, 89 GEO. L. J. 97, 99(2000) (explaining that public choice analyses have often assumed that administrative agencies act with selfinterested motives).
67. See Daryl J. Levinson, Empire-Building Government in Constitutional Law, 118 HARV. L. REV. 915, 920(2005) (arguing that government officials may not seek to aggrandize their agencies, as scholars have previously contended).
68. See, e.g., David Zaring, CFIUS as a Congressional Notification Service, 83 S. CAL. L. REV. 81, 92-95 (2009) (describing the evolution of a committee chaired by the Secretary of the Treasury from one with a cautious track record to one with broader involvement in foreign affairs).
69. And here, too, Treasury exemplifies a process known to other agencies, which on occasion have preferred to implement their mandates through informal advice and the development of best practices rather than through the sort of rulemaking likely to end up in the courts of appeals. For a description of this process, see generally David Zaring, Best Practices, 81 N. Y. U. L. REV. 294(2006).
70. See infra note 50 and accompanying text.
71. Posner & Vermeule, supra note 4.
72. Id. at 16.
73. Id. at 17.
74. JOHN H. YOO, CRISIS AND COMMAND: A HISTORY OF EXECUTIVE POWER FROM GEORGE WASHINGTON TO GEORGE W. BUSH, at xix (2009) (explaining that "[p]residential power has expanded with each crisis and emergency"). "Our Constitution designed the executive branch to wield power effectively and flexibly, and our history has favored forceful, not constrained, Presidencies."
75. Id. at xx.
76. The "man on horseback" trope traditionally involves the takeover of the government by a military leader. Since the President is the Commanderin-Chief of the armed forces, perhaps the analogy may be stretched to fit.
77. See Michael L. Kramer & Michael N. Schmitt, Lawyers on Horseback? Thoughts on Judge Advocates and Civil-Military Relations, 55 UCLA L. REV. 1407, 1409(2008) ("[D]emocratic organizational theory has long held that civilian institutions and personnel must exercise ultimate authority over the military, lest a 'man on horseback' wrest control of the State from the citizenry.").
78. See Davidoff & Zaring, supra note 28, at 465-68 (describing the agencies' legal flexibility);
79. Posner & Vermeule, supra note 4, at 36 ("[A] damaged president could not fufill the necessary leadership role, but that role quickly devolved to the Treasury Secretary and Fed Chair....").
80. See Davidoff & Zaring, supra note 28, at 470 ("Governments, though, again, not the government of the United States, have nationalized firms and industries before. But this regulation by deal is new, and it is new in size, scale, and scope.");
81. id. at 504-08 (describing the mechanism by which the Treasury guaranteed the money market system).
82. As I have discussed elsewhere, antitakeover specialist Wachtell, Lipton, Rosen & Katz had no fewer than five attorneys, including a name partner and a chair of its executive committee, pen pieces on the Committee during a six-month period between November 2007 and May 2008. Zaring, supra note 40, at 87;
83. see also Profile of Edward D. Herlihy, WACHTELL, LIPTON, ROSEN & KATZ, http://www.wlrk.com/EDHerlihy (last visited Oct. 22, 2010) (listing Herlihy as co-chair of Wachtell Lipton's executive committee).
84. Chambers and Partners ranks the four best as Cravath, Swaine & Moore; Davis Polk & Wardwell; Simpson Thacher & Bartlett; and Latham & Watkins'firms undoubtedly among the most prestigious and lucrative in the country. The Chambers and Partners rankings of Banking and Financial Institutions practice groups in the United States may be found at http://www.chambersandpartners.com/USA/Editorial/33222 (last visited Oct. 22, 2010).
85. See Alan Feuer, Trauma Surgeon of Wall Street, N. Y. TIMES, Nov. 15, 2009, at MB1, available at 2009 WLNR 22970411.
86. See John F. Coverdale, Chevron's Reduced Domain: Judicial Review of Treasury Regulations and Revenue Rulings After Mead, 55 ADMIN. L. REV. 39, 69-72 (2003) (describing how Treasury does not typically follow APA noticeand-comment procedures when promulgating temporary regulations and revenue rulings).
87. Id.
88. GAO Federal Rules Database Search, U. S. GOV'T ACCOUNTABILITY OFF., http://www.gao.gov/fedrules/index.php (search "Department of the Treasury" agency, "All" priority, "Major" rule types, date published in the Federal Register between "October 1999" and "October 2009"). A major rule is defined as a rule resulting in, or likely to result in, an annual effect on the economy of $100 million or more (or meeting certain other criteria).
89. U. S. C. § 804(2) (2006). Of the 928 substantive rules promulgated by Treasury during this period, 570 originated with the IRS. Compare GAO Federal Rules Database Search, supra (search "Department of Treasury" agency, "Significant/Substantive" priority, "All" rule types, date published in the Federal Register between "October 1999" and "October 2009"), with id. (search "Department of Treasury" agency, "Internal Revenue Service" subagency, "Significant/ Substantive" priority, "All" rule types, date published in the Federal Register between "October 1999" and "October 2009") (showing the significant proportion of IRS rules). The Department of Transportation, by contrast, issued 984 rules during this period.
90. Id. (search "Department of Transportation" agency, "Significant/Substantive" priority, "All" rule types, date published in the Federal Register between "October 1999" and "October 2009").
91. GAO Federal Rules Database Search, supra note 55 (search "Department of Transportation" agency, "All" priority, "Major" rule types, date published in the Federal Register between "October 1999" and "October 2009").
92. Id. (search "Independent Agencies and Govt Corporations" agency, "United States Securities and Exchange Commission" subagency, "All" priority, "Major" rule types, date published in the Federal Register between "October 1999" and "October 2009");
93. id. (search "Independent Agencies and Govt Corporations" agency, "Environmental Protection Agency" subagency, "All" priority, "Major" rule types, date published in the Federal Register between "October 1999" and "October 2009").
94. Treasury is one of seven agencies mostly likely to issue a rule without a notice of proposed rulemaking, ordinarily required by the APA. U. S. GEN. ACCOUNTING OFFICE, GAO/GGD-98-126, FEDERAL RULEMAKING: AGENCIES OFTEN PUBLISHED FINAL ACTIONS WITHOUT PROPOSED RULES 12(1998).
95. Victor S. Netterville, The Administrative Procedure Act: A Study in Interpretation, 20 Geo. Wash. L. Rev. 1, 8(1951).
96. A Westlaw search for ca ("Department of the Treasury") & da (aft 1956) in the CTADC database (reported opinions by the D. C. Circuit) on September 12, 2010, identified only seventy-five cases since 1956. This includes all cases where "Department of the Treasury" is in the caption of the case.
97. Westlaw search for ca ("Securities and Exchange Commission") & da (aft 1999 & bef 2008) on September 12, 2010.
98. Westlaw search for ca ("Environmental Protection Agency") & da (aft 1999 & bef 2008) on September 12, 2010.
99. Westlaw search for ca ("Department of Transportation") & da (aft 1999 & bef 2008) on September 12, 2010.
100. Westlaw search for ca ("Department of the Treasury") & da (aft 1999 & bef 2008) on Sept. 12, 2010.
101. See, e.g., Davidoff & Zaring, supra note 28, at 465-66 (providing an example of coordination between the two offices in a banking matter).
102. ADMIN. OFFICE OF THE U. S. COURTS, JUDICIAL BUSINESS OF THE UNITED STATES COURTS: 2008 ANNUAL REPORT OF THE DIRECTOR 144(2008).
103. Id. at 144-45.
104. See THOMAS O. MCGARITY, REINVENTING RATIONALITY: THE ROLE OF REGULATORY ANALYSIS IN THE FEDERAL BUREAUCRACY 291(1991) (concluding OMB's "effect on day-to-day decisionmaking should not be overstated");
105. Bagley & Revesz, supra note 13;
106. Bruff, supra note 19;
107. Christopher C. DeMuth & Douglas H. Ginsburg, White House Review of Agency Rulemaking, 99 HARV. L. REV. 1075, 1088(1986) (noting that OMB had left eighty percent of the regulations it reviewed unchanged);
108. Alan B. Morrison, OMB Interference with Agency Rulemaking: The Wrong Way to Write a Regulation, 99 HARV. L. REV. 1059, 1061(1986) (explaining that before the OMB's increased role, judicial review and congressional oversight cured most agency mistakes);
109. Alan B. Morrison et al., The Role of the President and OMB in Informal Rulemaking, 38 ADMIN. L. REV. 181, 191(1986) (arguing that authority still resides with agencies and that the OMB's role is supervisory);
110. Steven T. Kargman, Note, OMB Intervention in Agency Rulemaking: The Case for Broadened Record Review, 95 YALE L. J. 1789, 1790(1986) (illustrating how OMB-influenced agency decisions are largely untouchable by judicial review).
111. See supra notes 12, 19 and accompanying text.
112. See Historical Reports, OFF. INFO. & REG. AFF., http://www.reginfo. gov/public/do/eoHistReviewSearch (select "Department of the Treasury" under "Economically Significant Reviews Completed" for each of years 2004-2008) (revealing zero, zero, four, two, and three reviews for each year, respectively).
113. See id. (select "Environmental Protection Agency" under "Economically Significant Reviews Completed" for each of years 2004-2008) (revealing eleven, eleven, eight, ten, and fourteen reviews for each year, respectively).
114. See id.
115. (select "Department of Transportation" under "Economically Significant Reviews Completed" for each of years 2004-2008) (revealing eight, eight, six, seven, and sixteen reviews for each year, respectively).
116. It is also worth noting that a General Accounting Office (GAO) 2003 report on OMB, designed to study OMB's role in agency rulemaking, examined nine agencies, not including Treasury, which is perhaps some evidence that the GAO did not consider OMB an important check on Treasury's authority.
117. See U. S. GEN. ACCOUNTING OFFICE, GAO-03-929, OMB'S ROLE IN REVIEWS OF AGENCIES' DRAFT RULES AND THE TRANSPARENCY OF THOSE REVIEWS 8(2003).
118. Treasury's fiscal work, to be sure, is often ministerial. It receives tax revenues, and issues them pursuant to congressional appropriations to the relevant agencies. Duties & Functions of the U. S. Department of the Treasury, U. S. DEPARTMENT TREASURY, http://www.treas.gov/education/duties/(last updated May 25, 2010). The point is only that this fundamental operation of the Department is old and one that has never been subject to the usual constraints of administrative procedure.
119. See Kristin E. Hickman, A Problem of Remedy: Responding to Treasury's (Lack of) Compliance with Administrative Procedure Act Rulemaking Requirements, 76 GEO. WASH. L. REV. 1153, 1157(2008) ("[S]tatutory provisions and the courts' own jurisprudence combined discourage procedural challenges against Treasury regulations to the point of denying taxpayers an adequate judicial remedy to vindicate procedural rights granted in the APA.").
120. Hickman, supra note 17, at 1799;
121. see also Coverdale, supra note 53;
122. Nina A. Mendelson, Regulatory Beneficiaries and Informal Agency Policymaking, 92 CORNELL L. REV. 397, 398-99 (2007) (explaining that administrative agencies often create "guidance documents" rather than notice-and-comment rules to avoid the requirements of the APA, and using the Treasury Department's Examination Handbook on the operation of thrift institutions as an example of such a document).
123. Hickman, supra note 17, at 1748 (finding that 40.9 percent of the 232 rulemaking projects studied did not follow notice-and-comment procedures under the APA). Hickman also notes critics of Treasury's lack of compliance with notice-and-comment procedures.
124. Id. at 1730 n. 12.
125. This chart has been adapted from the complete version which can be found at US Department of Treasury Organization Chart'Top Level, NETAGE. COM, http://www.netage.com/economics/gov/USTreasury-chart-top.html (last visited Oct. 22, 2010).
126. A more recent version of this chart has been posted on the Department of the Treasury's website. Treasury Organization Chart, U. S. DEPARTMENT TREASURY, http://www.ustreas.gov/open/docs/DAS%20with% 20bureaus%20org%20chart%208.12. 2010.pdf (last visited Oct. 22, 2010).
127. See OFFICE OF THE CURATOR, DEP'T OF THE TREASURY, DEPARTMENT OF THE TREASURY 16(2006), available at http://www.treasury.gov/education/history/ brochure/brochure.pdf (outlining the structure of Treasury).
128. See id. at 15.
129. See id. at 1
130. (detailing Treasury's historical roots).
131. See Office of Domestic Finance, U. S. DEPARTMENT TREASURY, http://www.treasury.gov/offices/domestic-finance/(last updated Apr. 15, 2010).
132. 5 U. S. C. § 553 (a) (1) (2006) (exempting functions involving the military or foreign affairs from administrative procedure requirements).
133. See OFFICE OF THE CURATOR, supra note 77, at 15.
134. See id. at 14.
135. See Treasury Organization Chart, supra note 76.
136. Tax is a notable exception, and its own phenomenon'one that this Article will largely leave to the ministrations of tax scholars.
137. See OFFICE OF THE CURATOR, supra note 77, at 14-15.
138. Federal Employment Statistics, U. S. OFF. PERSONNEL MGMT. (Jan. 2009), http://www.opm.gov/feddata/html/2009/January/table15.asp.
139. Id.
140. It is worth noting that nothing in the argument of this Article turns on the idiosyncratic, elaborate, and massive tax regime that has its own independent bureau only nominally within Treasury, its own rules, its own courts, and its own bar. Still, tax's idiosyncrasy is both instructive and replicated elsewhere in the Department.
141. For the Federal Management Service, which is comprised of many of the remaining employees of the Department, the APA is much less relevant than the Red Book, which governs the federal government's fiscal outlays.
142. See infra Part I. C.1.a (discussing banking regulation).
143. See 5 U. S. C. § 553 (a) (2) (2006) (excepting from APA "matter[s] relating to agency management or personnel or to public property, loans, grants, benefits or contracts"). Indeed, some early versions of the APA specifically exempted the fiscal operations of the Treasury from review entirely.
144. Foster H. Sherwood, The Federal Administrative Procedure Act, 41 AM. POL. SCI. REV. 271, 276(1947).
145. See 5 U. S. C. § 553 (a) (1) (2006).
146. Bush: 'We Will Starve the Terrorists,' CNN.com (Sept. 24, 2001), http://archives.cnn.com/2001/US/09/24/ret.bush.transcript/.
147. See, e.g., Treasury Organization Chart, supra note 76 (displaying international Treasury officers serving under the Under Secretary for International Affairs).
148. See Office of Domestic Finance, supra note 80 (outlining duties of the office).
149. See OFFICE OF THE CURATOR, supra note 77, at 2-6 (outlining the early financial duties of Treasury).
150. This review is admittedly broad-brush; multivolume treatises have been written about the details of banking regulation.
151. See, e.g., HENRY J. BAILEY & RICHARD B. HAGEDORN, BRADY ON BANK CHECKS (2010) (multivolume treatise on regulation and case law related to bank checks and commercial paper);
152. INTERNATIONAL BANKING LAW AND REGULATION (Dennis Campbell ed., 2000) (two-volume treatise on international banking regulation);
153. MICHAEL P. MALLOY, BANKING LAW AND REGULATION (1994) (three-volume treatise on banking regulation);
154. MICHIE ON BANKS AND BANKING (P. A. Ernest ed., 2004) (thirteen-volume comprehensive treatise on banking law and regulation);
155. WILLIAM H. SCHLICHTING ET AL., BANKING LAW (2010) (regularly updated nine-volume treatise on banking law).
156. See, e.g., Binyamin Appelbaum & Ellen Nakashima, Regulator Let IndyMac Bank Falsify Report, WASH. POST, Dec. 23, 2008, at A1 (noting regulators' conference calls with bank officials).
157. Dodd-Frank Wall Street Reform and Consumer Protection Act, Pub. L. No. 111-203, §§ 311-319, 124 Stat. 1376, 1520-28 (2010).
158. About the OCC, OFF. COMPTROLLER CURRENCY, http://www.occ.treas.gov/ aboutocc.htm (last visited Oct. 22, 2010);
159. About the OTS, OFF. THRIFT SUPERVISION, http://www.ots.treas.gov/?p= AboutOTS (last visited Oct. 22, 2010). Bank holding companies, however, are regulated by the Federal Reserve.
160. See Federal Reserve Board Frequently Asked Questions: Banking Information, FED. RES. BOARD, http://www.federalreserve.gov/generalinfo/faq/ faqbkinfo.htm (last updated July 16, 2010). Because the largest and most important banks include bank holding companies, it is fair to say that these institutions have two regulators, which may not always, at least when it comes to the details, get along.
161. Who is the FDIC?, FED. DEPOSIT INS. CORP., http://www.fdic.gov/about/ learn/symbol/WhoistheFDIC.pdf (last visited Oct. 22, 2010).
162. See, e.g., About the OCC, supra note 100 (outlining OCC's preventative measures, including removing failing banks' officers and changing banking practices).
163. See id.
164. (noting OCC's supervisory activities);
165. see also About the OTS, supra note 100 (explaining OTS's role in supervision).
166. See Howell E. Jackson, The Expanding Obligations of Financial Holding Companies, 107 HARV. L. REV. 507, 523-28 (1994) (describing judicial oversight over the enforceability of capital maintenance commitments);
167. Kieran J. Fallon, Note, Source of Strength or Source of Weakness?: A Critique of the "Source-of-Strength" Doctrine in Banking Reform, 66 N. Y. U. L. REV. 1344, 1372-80 (1991) (describing judicial oversight of the Federal Reserve Board's source-of-strength policy).
168. For analyses of rules-based versus principles-based regulations
169. see generally Lawrence A. Cunningham, A Prescription to Retire the Rhetoric of "Principles-Based Systems" in Corporate Law, Securities Regulation, and Accounting, 60 VAND. L. REV. 1411(2007);
170. Kathleen M. Sullivan, Foreword: The Justices of Rules and Standards, 106 HARV. L. REV. 22(1992).
171. See, e.g., Appelbaum & Nakashima, supra note 98 (discussing principles-based regulators' tendency to regulate through conference calls). There are few principles-based regulators in the federal government. Those that do exist'such as the Commodities Futures Trading Commission (CFTC) 'enjoy a more limited relationship with the judiciary and possibly with their executive and congressional supervisors than the more rules-based and enforcement-oriented agencies.
172. See, e.g., Jill E. Fisch, Top Cop or Regulatory Flop? The SEC at 75, 95 VA. L. REV. 785, 795(2009) (comparing the CFTC's principles-based regulation to the rules-based SEC);
173. DEP'T OF TREASURY, THE DEPARTMENT OF THE TREASURY BLUEPRINT FOR A MODERNIZED FINANCIAL REGULATORY STRUCTURE 11(2008), available at
174. David Zaring, Informal Procedure, Hard and Soft, in International Administration, 5 CHI. J. INT'L L. 547, 573(2005).
175. See About the OCC, supra note 100 (describing on-site reviews).
176. See, e.g., Appelbaum & Nakashima, supra note 98 (describing OTS as behaving more like "consultants, not cops").
177. See id.
178. (noting that banks classified by Treasury as "well capitalized" are able to receive deposits from brokers).
179. See id.
180. (questioning the Agency's cozy "relationship with the companies it regulates").
181. See id.
182. (stating that "OTS fail[s] to enforce its own rules" with respect to regulated banks).
183. See Lloyd H. Mayer, The Much Maligned 527 and Institutional Choice, 87 B. U. L. REV. 625, 671(2007) ("The Treasury Department... [has] numerous structural and practical constraints preventing... capture.").
184. But see Johnson, supra note 4, at 52 (discussing the American financial sector and noting "[f]rom this confluence of campaign finance, personal connections, and ideology there flowed, in just the past decade, a river of deregulatory policies").
185. See Office of Domestic Finance, supra note 80 (listing the office's duties).
186. Office of Fiscal Service: About the Office of Fiscal Service, U. S. DEPARTMENT TREASURY, http://www.ustreas.gov/offices/domestic-finance/fiscal- service/(last modified Dec. 5, 2008).
187. Id.
188. See id.
189. In performing this role, for what it is worth, Domestic Finance has stayed true to its light, principles-based approach. It has regulated the markets for the sale of its debt with a much lighter touch than that exercised by other American capital markets regulators.
190. See Edward W. Little, Jr., Comment, Legislating in Secret: The Treasury Department's Thirty-Five Percent Rule and the "Public Contracts" Exemption to the Administrative Procedure Act, 6 ADMIN. L. J. AM. U. 545, 545(1992) (describing Treasury's authorization to oversee government debt).
191. See Lincoln v. Vigil, 508 U. S. 182, 193-94 (1993) (holding that the Indian Health Service's decision to discontinue a program providing services to handicapped Indian children was not subject to judicial review because Congress gave the Agency a lump sum appropriation which it had discretion to allocate).
192. Section 553 (a) (2) exempts from rulemaking "a matter relating to agency management or personnel or to public property, loans, grants, benefits, or contracts." 5 U. S. C. § 553 (a) (2) (2006).
193. See United States v. MacCollom, 426 U. S. 317, 321(1976) ("The established rule is that the expenditure of public funds is proper only when authorized by Congress, not that public funds may be expended unless prohibited by Congress."
194. (citing Reeside v. Walker, 52 U. S. (11 How.) 272, 291(1850))).
195. U. S. GEN. ACCOUNTING OFFICE, PRINCIPLES OF FEDERAL APPROPRIATIONS LAW (3d ed. 2004).
196. Id.
197. See Treasury Organization Chart, supra note 76.
198. 5 U. S. C. § 553 (a) (1) (2006). For further discussion of this exemption
199. see Oona A. Hathaway, Presidential Power over International Law: Restoring the Balance, 119 YALE L. J. 140, 241-42 (2009).
200. See Zaring, supra note 107, at 597-600 (discussing democratic oversight of international regulatory cooperation);
201. see also Robert D. Putnam, Diplomacy and Domestic Politics: The Logic of Two-Level Games, 42 INT'L ORG. 427, 454-56 (1988) (discussing reverberation between international and domestic negotiations).
202. See Office of International Affairs: Offices, U. S. DEPARTMENT TREASURY, http://www.ustreas.gov/offices/international-affairs/offices.shtml (last updated Aug. 4, 2010) (discussing the role of the Office of Development Policy and Debt in advising the U. S. government on its international economic development efforts).
203. See REBECCA M. NELSON, CONG. RESEARCH SERV., THE G-20 AND INTERNATIONAL ECONOMIC COOPERATION: BACKGROUND AND IMPLICATIONS FOR CONGRESS 8(2009), available at http://www.fas.org/sgp/crs/row/R40977.pdf (noting Treasury's role in coordinating with various federal agencies to prepare for the G20 summit).
204. See infra notes 128-30 and accompanying text.
205. See Jonathan Sedlak, Comment, Sovereign Debt Restructuring: Statutory Reform or Contractual Solution?, 152 U. PA. L. REV. 1483, 1484(2004) (noting Treasury's advocacy for inclusion of collective action clauses in lenders' debt instruments).
206. See generally Zaring, supra note 107, at 573-80 (noting the involvement of American regulators, including the Treasury's OCC, in the capital accord negotiation process).
207. Cf. Nelson, supra note 126, at 8, 12 (noting Treasury's role in representing the United States in the G20 and enumerating targeted regulatory reforms).
208. ANNE-MARIE SLAUGHTER, A NEW WORLD ORDER 14(2004).
209. Id. at 51-52
210. (categorizing regulatory government networks as information, enforcement, and harmonization networks).
211. See Putnam, supra note 124, at 454-56.
212. The new Financial Stability Board is an example of this response.
213. See History, FIN. STABILITY BOARD, http://www.financialstabilityboard. org/about/history.htm (last visited Oct. 22, 2010) (discussing creation of the Financial Stability Board by G20 nations to improve international financial regulation and promote financial stability).
214. See, e.g., Zaring, supra note 107, at 565 (noting, for example, that the International Organization of Securities Commissions' administrative procedures are not subject to the notice-and-comment requirements of the APA).
215. NELSON, supra note 126.
216. For a discussion of the G20
217. see generally David Zaring, International Institutional Performance in Crisis, 10 CHI. J. INT'L L. 475, 493-99 (2010).
218. See id.
219. See Peter I. Hajnal & John J. Kirton, The Evolving Role and Agenda of the G7/G8: A North American Perspective, 7 NIRA Rev. 5, 6(2000), available at http://www.g7.utoronto.ca/scholar/hajnal-nira.pdf.
220. See Zaring, supra note 137, at 493 ("[The G20] has come to be the basis of the initial policymaking response to the crisis that we have seen at a global level.").
221. Id. at 496.
222. The G8: Questions About the G8, G8'SOMMET EVIAN SUMMIT 2003, http://www.g8.fr/evian/english/navigation/the-g8/questions-about-the-g8. html#question5 (last visited Oct. 22, 2010) (noting that the G8 has no official language because it is not an international organization).
223. After all, while the G20 may be what political scientists call a regime, in that it creates "sets of governing arrangements" that include "networks of rules, norms, and procedures that regularize behavior and control its effects, "
224. ROBERT D. KEOHANE & JOSEPH S. NYE, POWER AND INTERDEPENDENCE 19(1977), it was never a "regime invested with any of the trappings of legal formality, or even quasi-legal network-like status, "
225. Zaring, supra note 137, at 496.
226. See also Stephen Krasner, Structural Causes and Regime Consequences: Regimes as Intervening Variables (1982)
227. reprinted in INTERNATIONAL REGIMES 1, 2 (Stephen D. Krasner ed., 1983) (defining "regimes").
228. See Zaring, supra note 107, at 597.
229. OFAC "administers and enforces economic and trade sanctions based on U. S. foreign policy and national security goals." Office of Foreign Assets Control: Mission, U. S. DEPARTMENT TREASURY, http://www.ustreas.gov/ offices/enforcement/ofac/index.shtml (last visited Oct. 22, 2010).
230. "FinCEN's mission is to enhance U. S. national security, deter and detect criminal activity, and safeguard financial systems from abuse by promoting transparency in the U. S. and international financial systems." FIN. CRIMES ENFORCEMENT NETWORK, http://www.fincen. gov/(last visited Oct. 22, 2010).
231. CFIUS determines the effect on national security of "transactions that could result in control of a U. S. business by a foreign person. " Office of Investment Security: Committee on Foreign Investment in the United States (CFIUS), U. S. DEPARTMENT TREASURY, http://www.treas.gov/offices/ international-affairs/cfius/(last updated Feb. 20, 2009).
232. Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism (USA PATRIOT) Act of 2001, Pub. L. No. 107-56, §§ 301-377, 115 Stat. 272, 296-342 (codified as amended in scattered titles of the U. S. C.). This section of the USA PATRIOT Act is also known as the "International Money Laundering Abatement and Financial Anti-Terrorism Act of 2001."
233. Id. § 301.
234. For a discussion of these new powers, see Zaring, supra note 40, at 95-97. As the 9/11 Commission has observed, "the use of administrative orders with few due process protections, particularly against our own citizens, raises significant civil liberty concerns and risks a substantial backlash."
235. NAT'L COMM'N ON TERRORIST ATTACKS UPON THE U. S., MONOGRAPH ON TERRORIST FINANCING 50(2004), available at http://govinfo.library.unt.edu/911/staff- statements/911-TerrFin-Monograph.pdf [hereinafter 9/11 Commission Monograph].
236. See Terrorism and Financial Intelligence: Mission, U. S. DEPARTMENT TREASURY, http://www.ustreas.gov/offices/enforcement/(last updated Aug. 4, 2010).
237. See, e.g., David Zaring & Elena Baylis, Sending the Bureaucracy to War, 92 IOWA L. REV. 1359, 1361(2007) (highlighting the use of new powers pursuant to the USA PATRIOT Act).
238. See Organization Chart, U. S. DEPARTMENT TREASURY, http://www.ustreas. gov/offices/enforcement/pdf/org-chart.pdf (last visited Oct. 22, 2010).
239. See Zaring, supra note 40, at 84-85 (detailing the transaction review procedure followed by CFIUS).
240. Trading with the Enemy Act, ch. 106, 40 Stat. 411(1917) (codified as amended at 12 U. S. C. § 95a (2006)).
241. See Zaring & Baylis, supra note 149, at 1405.
242. See id. at 1400.
243. Id. at 1394.
244. Some of OFAC's terrorism regulation predates 9/11, however. The Antiterrorism and Effective Death Penalty Act of 1996 (AEDPA), for example, authorizes the Secretary of State to designate an organization as a Foreign Terrorist Organization (FTO).
245. See 8 U. S. C. § 1189 (a) (2006). Such a designation is significant because it allows OFAC to freeze all assets of the designated organization that are in the United States or controlled by a U. S. financial institution.
246. See id. § 1189 (a) (2) (C);
247. Zaring & Baylis, supra note 149, at 1394 n. 142 (discussing other consequences of FTO designation).
248. Exec. Order No. 13, 224, 66 Fed. Reg. 49, 079, 49, 079 (Sept. 25, 2001).
249. OFAC acted "under presidential wartime and national emergency powers and authority granted by specific legislation to impose controls on transactions and freeze foreign assets under U. S. jurisdiction. " The Oil-for-Food Program: Tracking the Funds: Hearing Before the H. Comm. on Int'l Relations, 108th Cong. 53(2004) (statement of Herbert A. Biern, Senior Associate Director, Division of Banking Supervision and Regulation, Federal Reserve Board), available at http://www.federalreserve.gov/boarddocs/testimony/2004/ 20041117/default.htm.
250. Exec. Order No. 13, 224, § 1 (d) (i), 66 Fed. Reg. at 49, 080. The authority for these freezes came from the International Emergency Economic Powers Act (IEEPA).
251. U. S. C. §§ 1701-1706 (2006). For more
252. see Nina J. Crimm, High Alert: The Government's War on the Financing of Terrorism and Its Implications for Donors, Domestic Charitable Organizations, and Global Philanthropy, 45 WM. & MARY L. REV. 1341, 1370-73 (2004) (explaining specially designated global terrorist classifications).
253. See Zaring & Baylis, supra note 149, at 1397 (discussing how the director of OFAC initiates asset freezes). These lists are subject to review under the APA, but also subject to the usual deference courts afford the Executive in national security matters.
254. See id. at 1398 (stating that challenges to OFAC blocking orders rarely succeed).
255. The USA PATRIOT Act permits OFAC to investigate, block during the pendency of an investigation, regulate, direct and compel, nullify, void, prevent or prohibit, any acquisition, holding, withholding, use, transfer, withdrawal, transportation, importation or exportation of, or dealing in, or exercising any right, power, or privilege with respect to, or transactions involving, any property in which any foreign country or a national thereof has any interest by any person, or with respect to any property, subject to the jurisdiction of the United States.
256. U. S. C. § 1702 (a) (1) (B) (2006) (emphasis added).
257. Pursuant to the pre-9/11 IEEPA, the President was granted the authority "to deal with any unusual and extraordinary threat... to the national security, foreign policy, or economy of the United States, if the President declares a national emergency with respect to such threat."
258. Id. § 1701 (a). IEEPA gave the president the ability to freeze the assets of nations with whom the United States is either at war, or that he had designated to be a national enemy.
259. Id. § 1702 (a) (1). The statute also provides for the sanctioning of supporters and nationals of the enemy.
260. Id. § 1702 (a) (1) (C).
261. For a discussion of how the USA PATRIOT Act altered the IEEPA, see Crimm, supra note 158, at 1357-59.
262. OFAC maintains this list on its website. Office of Foreign Assets Control: Specially Designated Nationals List, U. S. DEPARTMENT TREASURY, http://www.ustreas.gov/offices/enforcement/ofac/sdn/(last updated Oct. 19, 2010);
263. see also Exec. Order No. 13, 224, § 1, 66 Fed. Reg. 49, 079, 49, 079-80 (Sept. 25, 2001).
264. See, e.g., Holy Land Found. for Relief & Dev. v. Ashcroft, 219 F. Supp. 2d 57, 64 (D. D. C. 2002)
265. aff'd, 333 F.3d 156 (D. C. Cir. 2003) (describing the freezing of the group's assets as well as the seizure of documents, computers, and furniture from the group's offices);
266. Zaring & Baylis, supra note 149, at 1398 n. 159
267. (noting the government's argument that an asset freeze does not fall within the purview of the Fourth Amendment because it does not search the frozen property).
268. Mariano-Florentino Cuéllar, The Mismatch Between State Power and State Capacity in Transnational Law Enforcement, 22 BERKELEY J. INT'L L. 15, 39 n. 90(2004).
269. 9/11 COMMISSION MONOGRAPH, supra note 147, at 99, 112. "This provision lets the government shut down an organization without any formal determination of wrongdoing. It requires a single piece of paper, signed by a midlevel government official."
270. Id. at 112.
271. As one court quoted when discussing OFAC, when an "agency's reasons and policy choices... 'conform to certain minimal standards of rationality'... the rule is reasonable and must be upheld." Holy Land, 219 F. Supp. 2d at 67
272. (quoting Small Refiner Lead Phase-Down Task Force v. EPA, 705 F.2d 506, 521 (D. C. Cir. 1983)). In that case, the charities alleged that OFAC's actions violated the Due Process Clause, the Takings Clause, the Fourth Amendment ban on unreasonable search and seizure, the First Amendment rights to freedom of speech and association, the Religious Freedom Restoration Act, and the APA.
273. Id. at 75.
274. OFFICE OF FOREIGN ASSETS CONTROL, U. S. DEP'T OF THE TREASURY, TERRORIST ASSETS REPORT 2(2008), available at http://www.ustreas.gov/offices/enforcement/ ofac/reports/tar2008.pdf.
275. See Zaring & Baylis, supra note 149, at 1413 (noting that U. S. banks spent approximately $125 million in both 2003 and 2004 to comply with Fin-CEN regulations and that "[h]igh-end estimates have placed the total costs of the money-laundering laws as $7 billion in 2003").
276. See id. at 1414-15
277. (describing FinCEN's expansion of discretion and power).
278. See id. at 1409-18
279. (discussing FinCEN in more detail).
280. Bank Secrecy Act of 1970, Pub. L. No. 91-508, 84 Stat. 1114
281. (codified as amended at 12 U. S. C. §§ 1951-1959 (2006)
282. U. S. C. §§ 321, 5311-5314, 5316-5322 (2006)).
283. See Cal. Bankers Ass'n v. Shultz, 416 U. S. 21, 26-30 (1974) (discussing the prevention of money laundering and other purposes of the BSA).
284. See 31 U. S. C. §§ 5311-5314, 5316-5322 (allowing Treasury to require reporting under a number of different circumstances).
285. See, e.g., 18 U. S. C. § 1956(2006) (expanding the number of predicate penalties for a money laundering charge);
286. id. § 1956 (c) (7) (D) (2006) (adding the provision of monetary support to the list of crimes under the Antiterrorism Act);
287. id. § 1960(2006) (deeming the operation of an unlicensed money transfer business a crime of general, rather than specific, intent);
288. U. S. C. § 5332(2006) (criminalizing the transportation of bulk cash).
289. See 18 U. S. C. § 1956 (b). For a description of this provision
290. see Zaring & Baylis, supra note 149, at 1410 n. 228.
291. See Robert W. Helm & Kevin K. Babikian, Creating, Managing and Distributing Offshore Investment Products: A Legal Perspective, in NUTS & BOLTS OF FINANCIAL PRODUCTS 2005: UNDERSTANDING THE EVOLVING WORLD OF CAPITAL MARKET & INVESTMENT MANAGEMENT PRODUCTS 715, 964 (PLI Corp. Law & Practice, Course Handbook Ser. No. B-1471, 2005).
292. See The Financial War on Terrorism and the Administration's Implementation of Title III of the USA PATRIOT Act: Hearings Before the S. Comm. on Banking, Hous., and Urban Affairs, 107th Cong. 60(2002) (statement of Michael Chertoff, Assistant Att'y Gen., Criminal Division, Department of Justice) ("Title III of the USA PATRIOT Act has provided law enforcement with important new authority to investigate and prosecute the financing of crime, including terrorism.").
293. Mission, FIN. CRIMES ENFORCEMENT NETWORK, http://www.fincen. gov/about-fincen/wwd/mission.html (last visited Oct. 22, 2009) (declaring FinCEN's mission as "[s]upporting law enforcement, intelligence, and regulatory agencies through sharing and analysis of financial intelligence").
294. See FIN. CRIMES ENFORCEMENT NETWORK, ANNUAL REPORT FISCAL YEAR 2009, at 4(2009), available at http://www.fincen. gov/news-room/rp/files/annual-report- fy2009.pdf (indicating that approximately 16.7 million BSA-required reports were filed in fiscal year 2009).
295. 31 U. S. C. § 5312 (a) (2), (c) (2006).
296. There have been some efforts to develop a safe harbor, or "white list, " of safe transactions and transactors.
297. Cf. Robert E. O'Leary, Improving the Terrorist Finance Sanctions Process, 42 N. Y. U. J. INT'L L. & POL. 549, 583-84 (2010) (discussing Treasury white lists and charities).
298. 31 U. S. C. § 5312 (a) (2) (Z) (2006) (allowing for regulation of "any other business designated by the [Treasury] Secretary whose cash transactions have a high degree of usefulness in criminal, tax, or regulatory matters").
299. See Mariano-Florentino Cuéllar, Rethinking Regulatory Democracy, 57 ADMIN. L. REV. 411, 443-45 (2005) (describing a notice-and-comment process for feedback and development as opposed to public hearings or legislative involvement).
300. See 31 U. S. C. § 5318 (g) (2006) (outlining the requirements for reporting suspicious transactions).
301. 31 U. S. C. § 5318 (h) (outlining the requirements for an institution's anti-money laundering program);
302. see also Lester Joseph, Anti-Money Laundering Update, in ADVANCED CORPORATE COMPLIANCE WORKSHOP 2003, at 627, 633 (PLI Corp. Law & Practice, Course Handbook Ser. No. B-1378, 2003) (providing further description of the anti-money laundering requirements).
303. See 31 U. S. C. § 5318 (l) (requiring financial institutions to make efforts to verify new customers, maintain records of the information used for verification, and consult terrorist lists);
304. Jeffrey P. Taft & Christina A. LaVera, The Changing Landscape of Federal Money Laundering Laws: An Overview of the USA PATRIOT ACT and Related Developments, 57 CONSUMER FIN. L. Q. REP. 109, 111-12 (2003) (providing more information on Customer Identification Verification). In addition to the previously described regulations, financial institutions are required to file Currency Transaction Reports, which include reports on "coins and currency received in a nonfinancial trade or business."
305. William J. Sweet, Jr. et al., Summary of the USA PATRIOT ACT of 2001 Anti-Money Laundering Provisions, in NEW RESPONSIBILITIES & OBLIGATIONS UNDER THE MONEY LAUNDERING ABATEMENT & FINANCIAL ANTI-TERRORISM ACT OF 2001, at 55, 68 (PLI Corp. Law & Practice, Course Handbook Ser. Number B-1289, 2002). Further, FinCEN increased regulation on insurance companies by requiring them to implement anti-money laundering programs and file Suspicious Activity Reports. Press Release, Fin. Crimes Enforcement Network, Insurance Companies Required to Establish Anti-Money Laundering Programs and File Suspicious Activity Reports (Oct. 31, 2005), available at http://www.fincen. gov/newsrelease10312005.pdf.
306. See Karen E. Hoffman, AML Security Emphasis Detection and Prevention, BANKING STRATEGIES, Jan./Feb. 2005, at 54, 56 (indicating that in both 2003 and 2004 banks spent $125 million a year on FinCEN regulatory compliance); Zaring & Baylis, supra note 149, at 1413 (noting that the moneylaundering laws may have total costs around $7 billion).
307. See Zaring & Baylis, supra note 149, at 1406-07 (discussing the role of consultants).
308. See, e.g., In re Wachovia Bank, No. 2010-1, FinCEN Assessment of Civil Money Penalty (Mar. 12, 2010), available at http://www.fincen. gov/news-room/ea/files/100316095447.pdf (assessing a $110 million fine);
309. In re Doha Bank, No. 2009-1, FinCEN Assessment of Civil Money Penalty (Apr. 20, 2009), available at http://www.fincen. gov/news-room/ea/files/Doha.pdf (assessing a $5 million fine);
310. In re United Bank of Africa, No. 2008-3, FinCEN Assessment of Civil Money Penalty (Apr. 22, 2008), available at http://www.fincen. gov/news-room/ea/ files/UBAAssessment.pdf (assessing a $15 million fine);
311. In re El Noa Noa Corp., No. 2008-2, FinCEN Assessment of Civil Money Penalty (Apr. 14, 2008), available at http://www.fincen. gov/news-room/ea/files/ ElNoaNoa.pdf (assessing a $12, 000 fine);
312. In re Sigue Corp. & Sigue, LLC, No. 2008-1, Fin-CEN Assessment of Civil Money Penalty (Jan. 24, 2008), available at http://www.fincen. gov/news-room/ea/files/sigue-assement-final.pdf (assessing a $12 million fine). A list of other enforcement actions are available on FinCEN's website.
313. Enforcement Actions, FIN. CRIMES ENFORCEMENT NETWORK, http://www.fincen. gov/news-room/ea/(last visited Oct. 22, 2010).
314. See Zaring, supra note 40, at 83 (describing the role of CFIUS);
315. Office of Investment Security: Committee on Foreign Investment in the United States (CFIUS), U. S. DEPARTMENT TREASURY, http://www.treas.gov/offices/ international-affairs/cfius/members.shtml (last updated Feb. 19, 2009) (identifying the members of CFIUS and offices that participate in CFIUS's activities).
316. In addition to CFIUS, Treasury is a member of other interagency committees. E.g., Federal Interagency Committee on Indoor Air Quality, U. S. ENVTL. PROTECTION AGENCY, http://www.epa.gov/iaq/ciaq/index.html#CIAQ-Members (last visited Oct. 22, 2010);
317. About the Interagency Coordinating Council on Emergency Preparedness and Individuals with Disabilities, U. S. DEPARTMENT HOMELAND SECURITY, http://www.dhs.gov/files/committees/editorial-0592.shtm (last modified Oct. 6, 2008).
318. See Jennifer Cooke, Finding the Right Balance of Sovereign Wealth Fund Regulation: Open Investment vs. National Security, 2009 COLUM. BUS. L. REV. 728, 772 (asserting a complete absence of judicial review of CFIUS);
319. Zaring, supra note 40, at 98 ("CFIUS's evolving legal authority is a story about substantive flexibility....").
320. See Zaring, supra note 40, at 107 n. 111 (describing the oft threatened use of a blocked transaction).
321. Eric Lipton, Chinese Withdraw Offer for Nevada Gold Concern, N. Y. TIMES, Dec. 22, 2009, at B3, available at 2009 WLNR 25712705.
322. See supra note 192 and accompanying text.
323. See generally Zaring, supra note 40.
324. See supra note 192 and accompanying text (describing the lack of judicial review over CFIUS).
325. David Zaring, What Exactly Can Foreign Sovereigns Purchase in America?, THE CONGLOMERATE (Apr. 11, 2008), http://www.theconglomerate.org/2008/04/what- exactly-ca.html;
326. see also Regulations Pertaining to Mergers, Acquisitions, and Takeovers by Foreign Persons, 72 Fed. Reg. 70, 702, 70, 705 (Nov. 21, 2008) (stating that the Committee will address national security concerns raised by "particular transaction[s], " "rather than identifying certain sectors in which foreign investment is prohibited, restricted, or discouraged"); Zaring, supra note 40, at 84.
327. See, e.g., Webster v. Doe, 486 U. S. 592, 601(1988) (concluding that, as a statutory matter, employment decisions by the director of the CIA are not subject to judicial review, and suggesting that employment in a national security agency is essentially unreviewable). Still, the question of how Webster's statutory national security exemption applies in other contexts is contested.
328. See Zaring, supra note 40, at 84 n. 8
329. (questioning the scope of Webster). The terms that trigger CFIUS investigations, such as "covered transaction, " "foreign person, " "U. S. person, " "critical infrastructure, " and "national security, " are either defined broadly or left undefined.
330. See Regulations Pertaining to Mergers, Acquisitions, and Takeovers by Foreign Persons, 73 Fed. Reg. 21, 861, 21, 861-68 (Apr. 23, 2008) (codified at 31 C. F. R. pt. 800) (providing a lengthy discussion of covered transactions and definitions). CFIUS's proposed definitions of these terms generally offer examples of terms but maintain flexibility to reach other, dissimilar matters.
331. Id.
332. See Richard J. Pierce, Jr., The Role of Constitutional and Political Theory in Administrative Law, 64 TEX. L. REV. 469, 489-507 (1985) (describing the U. S. delegation doctrine as "moribund" and critiquing efforts to revive it).
333. 50 App. U. S. C. § 2170 (b) (2006).
334. This grant of substantive power is increasingly common following Chevron, U. S. A., Inc. v. Natural Res. Def. Council, 467 U. S. 837, 864-66 (1984).
335. 50 App. U. S. C. § 2170 (b) (3) (B), (d).
336. The agreements are so labeled because the acquirer agrees to take steps to "mitigate" the threat to national security.
337. Id. § 2170 (l) (1).
338. Id.
339. See Zaring, supra note 40, at 117-21 (discussing "boilerplate" agreements).
340. See Council on Foreign Relations, Global FDI Policy: Correcting a Protectionist Drift (June 26, 2008) (transcript available at http://www.cfr.org/publication/16695/global-fdi-policy.html) (discussing how companies get approval from members of Congress before engaging in transactions). For more on Congress's role
341. see Jonathan C. Stagg, Note, Scrutinizing Foreign Investment: How Much Congressional Involvement Is Too Much? 93 IOWA L. REV. 325, 342(2007) ("Congress has chosen to take action in several instances where it considered a transaction a threat to national security, even after CFIUS conducted an investigation and approved the deal.").
342. See Yvonne C. L. Lee, The Governance of Contemporary Sovereign Wealth Funds, 6 HASTINGS BUS. L. J. 197, 209(2010) (citing examples of foreign investments facing opposition from Congress despite executive approval);
343. Stagg, supra note 206, at 340 n. 116 (noting, for example, that in 2004 CFIUS only recommended blocking one out of forty-five such transactions).
344. See Lee, supra note 207.
345. OFFICE OF THE CURATOR, supra note 77, at 1.
346. See, e.g., Eric Lichtblau & James Risen, Bank Data Sifted in Secret by U. S. to Block Terror, N. Y. TIMES, June 23, 2006, at A1, available at 2006 WLNR 10871009.
347. See Jack Balkin & Sanford Levinson, Understanding the Constitutional Revolution, 87 VA. L. REV. 1045, 1056(2001) ("Criminal procedure has been in retrenchment from the days of the Warren Court almost continuously since the 1970s."). (Pubitemid 33656658)
348. Of course, the extent of unreviewability on the basis of national security and executive branch prerogative has, in other contexts, spawned a large legal literature and series of Supreme Court cases'as exemplified by the extensive litigation over executive detentions, extraordinary renditions, and conditions of confinement for potential terrorists since 9/11.
349. See, e.g., Hamdan v. Rumsfeld, 548 U. S. 557, 593 n. 23(2006) ("[The President] may not disregard limitations that Congress has, in proper exercise of its own war powers, placed on his powers.").
350. See generally David J. Barron & Martin S. Lederman, The Commander in Chief at the Lowest Ebb'A Constitutional History, 121 HARV. L. REV. 941(2008) (examining whether the President possesses inherent war powers that may be used against the will of Congress);
351. Cass R. Sunstein, Clear Statement Principles and National Security: Hamdan and Beyond, 2006 SUP. CT. REV. 1 (discussing the tendency of the judiciary to require clear direction from Congress before allowing serious executive intrusion into fundamental liberties);
352. Posner & Vermuele, supra note 4 (comparing emergency governance during the 9/11 attacks and the 2008 financial crisis).
353. See supra notes 53-58 and accompanying text (explaining how Treasury rarely follows standard administrative procedures).
354. See Lawson, supra note 4, at 57-58 (arguing that Congress and the President were out of control when they handed Treasury unprecedented emergency authority).
355. See U. S. SEC. & EXCH. COMM'N, SEC'S OVERSIGHT OF BEAR STEARNS AND RELATED ENTITIES: THE CONSOLIDATED SUPERVISED ENTITY PROGRAM (2008), available at http://www.sec.gov/about/oig/audit/2008/446-a.pdf (noting SEC's role in supervising investment banks);
356. FDIC Mission, Vision, and Values, FED. DEPOSIT INS. CORP., http://www.fdic.gov/about/mission/index.html (last updated May 4, 2009) (discussing the FDIC's mission of "examining and supervising financial institutions for safety and soundness and consumer protection").
357. See Neil Irwin, On the Money at Treasury; Working Behind the Scenes, Paulson Had His Department Ready to Confront the Credit Crisis, WASH. POST, Nov. 20, 2007, at D01 (discussing Paulson's Goldman Sachs background and Treasury's use of dealmaking).
358. See Davidoff & Zaring, supra note 28, at 467 (explaining that Treasury acted as a dealmaker whose primary focus was not on strict compliance with contract, securities, and corporate law).
359. Robert N. Sobol, Enhanced Cash "Yield Plus" Funds: The Treasurer's New Cash Management Complement to Money Market Funds, 7 J. INVESTMENT COMPLIANCE 60, 60(2006) (stating that Bruce Bent invented money market funds in 1970 and offered them to the public in 1971);
360. Bruce Weber, Henry B. R. Brown, Who Opened Money Markets to Masses, Dies at 82, N. Y. TIMES, Aug. 15, 2008, at B5, available at 2008 WLNR 15305678 (stating that Henry B. R. Brown and Bruce Bent collaborated in starting the first money market fund, the Reserve).
361. See Sobol, supra note 218, at 61 (describing how MMFs are known for their relative stability).
362. Id. at 61 (noting these asset classes, their traditional safety, and the general willingness of funds to protect their investors' principal).
363. Weber, supra note 218.
364. See id.
365. (noting total MMF assets at nearly $3.6 trillion in 2008).
366. 17 C. F. R. § 270.2a-7 (2010).
367. See id.;
368. Sobol, supra note 218, at 61 (referring to these requirements).
369. Diana B. Henriques, Money Market Fund Warns Its Customers Face Losses, N. Y. TIMES, Sept. 17, 2008, at C1, available at 2008 WLNR 17634393 (noting the rareness of MMFs breaking the buck). The one other instance of an MMF breaking the buck occurred in 1994, when Community Bankers Mutual Fund in Denver liquidated.
370. See Christopher Condon, Reserve Primary Money Fund Falls Below $1 a Share, BLOOMBERG. COM, Sept. 16, 2008, http://www.bloomberg.com/apps/news?pid= 20601087&sid=a5O2y1go1GRU (stating that Community Bankers Mutual Fund liquidated because of investments in interest-rate derivatives).
371. Tara Siegel Bernard, Money Market Funds Enter a World of Surprising Risk, N. Y. TIMES, Sept. 18, 2008, at C13, available at 2008 WLNR 17703966.
372. John Waggoner, Money Market Fund Breaks a Buck, USA TODAY, Sept. 17, 2008, at 4B, available at 2008 WLNR 17632868.
373. INV. CO. INST., REPORT OF THE MONEY MARKET WORKING GROUP 54-55 (2009), available at http://www.ici.org/pdf/ppr-09-mmwg.pdf (describing how the growth in its commercial paper assets increased the Primary Fund's yield, doubling its assets from $30 billion to $67 billion).
374. Diana B. Henriques, Professional Money Fund Is Closed by Putnam, N. Y. TIMES, Sept. 19, 2008, at C1, available at 2008 WLNR 17804319.
375. Diana B. Henriques, Treasury to Guarantee Money Market Funds, N. Y.
376. See Press Release, U. S. Dep't of the Treasury, Treasury Announces Guaranty Program for Money Market Funds (Sept. 19, 2008), available at http://www.treasury.gov/press/releases/hp1147.htm (describing MMFs as "a fundamental source of financing for our capital markets and financial institutions").
377. Henriques, supra note 230 ("The Treasury Department announced that, at least temporarily, it would guarantee money market funds against losses up to $50 billion. ");
378. Press Release, U. S. Dep't of the Treasury, supra note 231 (announcing the guaranty program and stating that the assets for the program will come from the Exchange Stabilization Fund that was established by the Gold Reserve Act of 1934).
379. Press Release, U. S. Dep't of the Treasury, supra note 231;
380. see also Davidoff & Zaring, supra note 28, at 506-07 (discussing Treasury's attempt to stabilize the market).
381. Mark Jewell, Money-Market Funds Flock to Guarantee Program, USA TODAY, Oct. 10, 2008, http://www.usatoday.com/money/economy/2008-10-10-3754594472-x. htm.
382. Press Release, U. S. Dep't of the Treasury, supra note 231;
383. Exchange Stabilization Fund: Introduction, U. S. DEPARTMENT TREASURY, http://www.treas.gov/offices/international-affairs/esf/(last updated Aug. 6, 2007).
384. OFFICE OF INSPECTOR GEN., DEP'T OF THE TREASURY, OIG-10-027, AUDIT OF THE EXCHANGE STABILIZATION FUND'S FISCAL YEARS 2009 AND 2008 FINANCIAL STATEMENTS 2, 13(2009), available at http://www.treas.gov/offices/international-affairs/ esf/congress-reports/(follow "ESF Annual Report for Fiscal Year 2009" hyperlink). The appropriated capital was later reduced to $200 million.
385. Id. at 2.
386. Press Release, U. S. Dep't of the Treasury, supra note 231.
387. 31 U. S. C. § 5302 (a) (1), (b) (2000) (emphasis added).
388. See id. § 5302 (b) (listing a series of assets that conspicuously omits U. S. dollars).
389. Id.
390. see also Davidoff & Zaring, supra note 28, at 507.
391. Diana B. Henriques, Treasury to Support a Frozen Money Fund, N. Y. TIMES, Nov. 21, 2008, at B6, available at 2008 WLNR 22234562. The agreement was a condition of the insurance program.
392. See id. ("The purchase agreement was a condition that the Treasury Department imposed on the fund before accepting it into the temporary money fund insurance program.... If the fund had been insured with no strings attached, it could have simply dumped its remaining $6.1 billion in government securities without worrying that such a fire sale would cause its per-share value to fall below a dollar because the Treasury would have been required to cover any shortfall.").
393. Press Release, U. S. Dep't of Treasury, Treasury Announces Expiration of Guarantee Program for Money Market Funds (Sept. 18, 2009), available at http://www.ustreas.gov/press/releases/tg293.htm.
394. See 17 C. F. R. § 270.2a-7 (2010) (regulating MMFs under the auspices of the SEC).
395. For example, the Sarbanes-Oxley Act, which created the Public Company Accounting Oversight Board (PCAOB), was enacted in 2002, but the Supreme Court did not rule on the PCAOB's constitutionality until 2010. See Sarbanes-Oxley Act of 2002, Pub. L. No. 107-204, §§ 101-109, 116 Stat. 745
396. (codified at 15 U. S. C. § 7201(2006));
397. David Zaring, Previewing the Business Case Decisions Tomorrow, THE CONGLOMERATE (June 27, 2010), http://www.theconglomerate.org/2010/06/previewing- the-business-case-decisions-tomorrow.html (discussing a Supreme Court case assessing the constitutionality of the PCAOB).
398. Emergency Economic Stabilization Act of 2008, Pub. L. No. 110-343, § 119, 122 Stat. 3782, 3787
399. (codified at 12 U. S. C. § 5229(2006)).
400. See supra note 24 and accompanying text.
401. Congress provided in section 119 of the EESA that "[a]ctions by the Secretary pursuant to the authority of this Act shall be subject to chapter 7 of title 5, United States Code, including that such final actions shall be held unlawful and set aside if found to be arbitrary, capricious, an abuse of discretion, or not in accordance with law." Emergency Economic Stabilization Act § 119 (a) (1). It confusingly added that "[n]o injunction or other form of equitable relief shall be issued against the Secretary for actions pursuant to section 101 [the power granting section]... other than to remedy a violation of the Constitution. " § 119 (a) (2) (A) (emphasis added). But because arbitrary and capricious review is generally thought of as equitable relief, it was never entirely clear what exactly Congress wanted the courts to do when reviewing an admittedly broad swath of Treasury's bailout implementation actions. For more on this, see Davidoff & Zaring
402. supra note 28, at 520.
403. Wachovia Corp. v. Citigroup, Inc., 634 F. Supp. 2d 445 (S. D. N. Y. 2009) (denying Citigroup's motion for judgment on the merger and holding that EESA could retroactively disrupt exclusivity agreement between the parties);
404. Citigroup, Inc. v. Wachovia Corp., 613 F. Supp. 2d 485 (S. D. N. Y. 2009) (holding that the bank's state law claims against two competitors were not completely preempted by EESA).
405. See Wachovia Corp., 634 F. Supp. 2d 445;
406. Citigroup, Inc., 613 F. Supp. 2d 485.
407. This claim was dismissed, somewhat bizarrely, for lack of standing. In re Chrysler LLC, 405 B. R. 79, 83 (S. D. N. Y. 2009) (dismissing a claim that TARP could not be used to bail out an auto manufacturer).
408. *1 (D. Ariz. May 22, 2009) (dismissing a pro se claim that EESA obligated a bank to renegotiate a mortgage);
409. *1 (D. Ariz. June 22, 2009);
410. *2-3 (E. D. Cal. Nov. 6, 2009);
411. *1 (Fed. Cl. Oct. 30, 2009).
412. See Murray v. Geithner, 624 F. Supp. 2d 667 (E. D. Mich. 2009) (permitting a taxpayer claim that the bailout of AIG, which has Sharia compliant products, violated the Establishment Clause).
413. See, e.g., In re Bear Stearns Cos. S'holder Litig., C. A. No. 3643-VCP, 2008 WL 959992 (Del. Ch. Apr. 9, 2008);
414. In re Bear Stearns Litig., 870 N. Y. S.2d 709 (N. Y. Sup. Ct. 2008).
415. See Davidoff & Zaring, supra note 28, at 483, 535 ("[T]hose state officials with the capacity to act... either got[] out of the way of or cooperated with federal officials.").
416. This has been a longstanding project of Jerry Mashaw.
417. See, e.g., Jerry L. Mashaw, Explaining Administrative Process: Normative, Positive, and Critical Stories of Legal Development, 6 J. L. ECON. & ORG. 267(1990). Frederick Schauer has made analogous claims about constitutional law'that the subject concerns only a subset (and in his view a relatively minor subset) of government.
418. See Frederick Schauer, Foreword: The Court's Agenda'and the Nation's, 120 HARV. L. REV. 4, 8(2006).
419. See, e.g, NetCoalition v. SEC, Nos. 09-1042, 09-1045, 2010 WL 3063632 (D. C. Cir. 2010) (petitioning for review of an SEC order);
420. Our Children's Earth Found. v. EPA, 527 F.3d 842 (9th Cir. 2008) (alleging that the EPA has failed to comply with the Clean Water Act).
421. Zaring & Baylis, supra note 149, at 1372 n. 48 (describing the "interest representation" model).
422. See Barbara L. Bezdeck, Contractual Welfare: Non-Accountability and Diminished Democracy in Local Government Contracts for Welfare-to-Work Services, 28 FORDHAM URB. L. J. 1559, 1559(2001) (discussing the movement of welfare policy to the state and local levels);
423. Tim Iglesias, Housing Impact Assessments: Opening New Doors for State Housing Regulation While Localism Persists, 82 OR. L. REV. 433, 484(2003) (discussing the role of local housing movements in influencing HUD policy).
424. Wendy Bach, Welfare Reform, Privatization and Power: Reconfiguring Administrative Law Structures from the Ground Up, 74 BROOK. L. REV. 275, 277(2009) (noting that contracting out is a growing trend in welfare administration).
425. See, e.g., Bezdeck, supra note 258, at 1559 (discussing the use of block grants in welfare administration).
426. See generally Dominique Custos & John Reitz, Public-Private Partnerships, 58 AM. J. COMP. L. 555 (Supp. 2010) (discussing public-private partnerships, the contracting out of government functions, and the lack of oversight).
427. See United States v. Curtiss-Wright Exp. Corp., 299 U. S. 304, 319(1936) (explaining that the "President is the sole organ of the nation in its external relations" (citation omitted));
428. see also Charles A. Lofgren, United States v. Curtiss-Wright Export Corporation: An Historical Reassessment, 83 YALE L. J. 1, 3-6 (1973)
429. (discussing Curtiss-Wright and its role with respect to foreign affairs).
430. See 5 U. S. C. § 553 (a) (1) (2006) (exempting foreign affairs activities from notice-and-comment procedures). The DOJ'the other classic old-line agency in addition to Defense'is a somewhat different case, though as much as it shapes policy for other agencies, it too does not make policy through the APA. Its important criminal law function is regulated by the courts through criminal, rather than administrative, procedure.
431. See The Federal Courts and the Other Branches of Government: How Does the Executive Branch Interact with the Federal Courts?, FED. JUD. CENTER, http://www.fjc.gov/federal/courts.nsf (follow "The Federal Courts and the Other Branches of Government" hyperlink; then follow "How does the Executive Branch interact with the Federal Courts?" hyperlink) (last visited Oct. 22, 2010) (noting that the DOJ "is the most frequent litigator in the federal courts"). The four original departments in the executive branch were Treasury, Foreign Affairs (which later became the State Department), War (which later became the Department of Defense), and Justice. GIDDENS-WHITE, supra note 35, at 13.
432. Justice is heavily lawyered, of course, and in many cases does follow many of the dictates of administrative procedure; its extraordinary role in administrative procedure lies in its performance supervision over those agencies subject to judicial review because of the role it plays in representing those agencies in that review.
433. See Appellate Staff, U. S. DEPARTMENT JUST., http://www.justice.gov/ civil/appellate.htm (last visited Oct. 22, 2010). It does not do so for every agency; some have their own appellate review staffs, such as the Federal Energy Regulatory Committee and EPA.
434. See Russell L. Weaver, Appellate Review in Executive Departments and Agencies, 48 ADMIN. L. REV. 251, 253-59, 287(1996). Department of Justice lawyers cannot be fired and therefore can exercise a great deal of discretion over the positions and policies of their clients, the agencies that they represent. (Pubitemid 126408801)
435. See, e.g., John T. Noonan, Immigration Law 2006, 55 CATH. U. L. REV. 905, 913(2006) (explaining that, in the immigration context, since DOJ lawyers are "[f]reed to exercise discretion, " they could "transform the litigation and mediation of immigration cases").
436. The Department of War, which later became the Department of Defense, has existed since the creation of the country. GIDDENS-WHITE, supra note 35, at 13.
437. Am. Fed'n of Gov't Emps. v. Hoffmann, 427 F. Supp. 1048, 1079 (N. D. Ala. 1976) (explaining that judicial review of "military matters and national defense" is "properly circumscribed").
438. See, e.g., Rothe Dev. Corp. v. U. S. Dep't of Defense, 262 F.3d 1306 (Fed. Cir. 2001) (holding that strict scrutiny applies to an unsuccessful bidder's equal protection claim regarding a Department of Defense contract). But if the oldest of government agencies look like Treasury, the financial regulation work that Treasury does need not be insulated from court oversight or notice-and-comment. The CFTC and SEC are financial regulators that are often subject to litigation as enforcers over a recalcitrant capital market establishment.
439. See, e.g., NetCoalition v. SEC, Nos. 09-1042, 09-1045, 2010 WL 3063632 (D. C. Cir. 2010);
440. Compania de Salvadorena de Cafe v. Commodities Futures Trading Comm'n, 446 F. Supp. 687 (S. D. N. Y. 1978). The CFTC explicitly pursues a more principles-based approach to regulation, perhaps comparably to Treasury.
441. Fisch, supra note 106, at 795.
442. Note the proliferation of international offices and counterterrorism programs across agencies, including OSHA and HUD.
443. See Zaring & Baylis, supra note 149, at 1425.
444. See Joel Seligman, Let the S. E. C. Help Itself, N. Y. TIMES, Feb. 27, 2010, at A21, available at 2010 WLNR 4145159 (arguing that the SEC should be able to fund itself like the Federal Reserve does);
445. see also Erik Gerding, Funding the SEC: Dependent on the Kindness of the Regulated?, THE CONGLOMERATE (Feb. 27, 2010), http://www.theconglomerate.org/ 2010/02/funding-the-sec-tie-to-market-levels-but-dont-rely-on-fees.html (agreeing that the SEC should not be funded through congressional appropriations, but rather should be tied to market levels).
446. Ossification is often thought to be a function of the Vermont Yankee decision, which meant that rulemaking procedures alone would be the basis for judicial review; the possibly predictable effect was that such procedures ballooned in size and scope.
447. Vermont Yankee Nuclear Power Corp. v. Natural Res. Def. Council, Inc., 435 U. S. 519(1978) (limiting judicial review of rulemakings to the rulemaking record);
448. Gillian E. Metzger, The Story of Vermont Yankee: A Cautionary Tale of Judicial Review and Nuclear Waste, in ADMINISTRATIVE LAW STORIES 124, 126 (Peter L. Strauss ed., 2006) (describing the growth of rulemaking records).
449. JERRY L. MASHAW & DAVID L. HARFST, THE STRUGGLE FOR AUTO SAFETY 103-04 (1990) (describing the malign influence of the courts in slowing an agency from enacting appropriate auto safety regulations).
450. As Shepherd explained regarding the enactment of the APA: The APA was an important and clear example of an attempt to influence outcomes by means of procedural requirements. The debates over the APA were not primarily a search for scientific efficiency, as others have argued. Instead, opposing political and economic forces fought fiercely over the APA for seventeen years because all knew and intended that the APA would influence policy outcomes profoundly.
451. George B. Shepherd, Fierce Compromise: The Administrative Procedure Act Emerges from New Deal Politics, 90 NW. U. L. REV. 1557, 1681(1996).
452. Jerry L. Mashaw, Reluctant Nationalists: Federal Administration and Administrative Law in the Republican Era, 1801-1829, 116 Yale L. J. 1636, 1739(2007).
453. See, e.g., David Broder, Permanent Government, Intractable Problems, WASH. POST, Jan. 23, 1992, at C7 (discussing the difficulties faced by the Department of Health and Human Services in making positive changes within congressional limitations on appropriations).
454. See generally Elena Kagan, Presidential Administration, 114 HARV. L. REV. 2245(2001) (describing the growth of presidential oversight and influence over agency decisionmaking). This Article should serve as a counterpoint to Kagan's, because the President, despite purportedly occupying a central role in agency oversight, actually does not play such a strict supervisory role over Treasury'and certainly did not during the financial crisis.
455. See Mashaw, supra note 272, at 1724 ("By 1816 the House had established six standing committees on expenditures'one each for the Departments of State, Treasury, War, Navy, and the Post Office, and one on public buildings.").
456. Id. at 1720.
457. Id.
458. Moreover, this is a form of supervision with historical pedigree. Treasury would sometimes be reviewed by boards of eminent officers. For example, the Chief Justice, the Treasury Secretary, the Secretary of State, and the Attorney General all inspected coinage of the mint. Mashaw, supra note 34, at 1301. And the Treasury Secretary, along with the Secretaries of War and State, oversaw the allocation of public land in the territories.
459. Id. at 1302.