Courts and regulatory capture

Preventing Regulatory Capture: Special Interest Influence and How to Limit it

Volumn 9781107036086, Issue , 2013, Pages 397-419

  Magill, M Elizabeth ^a,b  

^a HARVARD LAW SCHOOL   (United States)

^b DOWNING COLLEGE   (United Kingdom)

Author keywords

[No Author keywords available]

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EID: 84928074218     PISSN: None     EISSN: None     Source Type: Book    
DOI: 10.1017/CBO9781139565875.020     Document Type: Chapter

References (65)

1. Dean and Richard E. Lang Professor, Stanford Law School. Thanks to Dan Carpenter, Jake Gersen, Stephen Griffin, Daryl Levinson, DavidMoss, KeithWerhan, anonymous reviewers, and participants in the Tobin Project 7project for their comments. Nicole DeMoss and Sam Guthrie provided excellent research assistance. Errors are mine.
2. Administrative Procedure Act, Pub. L. No. 79-404, 60 Stat. 237 (codified as amended in scattered sections of 5 U.S.C.). 3 5 U.S.C. § 553. This is commonly referred to as “notice and comment rulemaking” or informal rulemaking.
3. Anne Joseph O’Connell, “Political Cycles of Rulemaking: An Empirical Portrait of the Modern Administrative State,” Virginia Law Review 94 (2008): 889, 964 (finding that “the average duration of completed rulemakings for nine of the ten agencies [analyzed in the article] was under two years”)
4. Sidney A. Shapiro and Randy Rabinowitz, “Voluntary Regulatory Compliance in Theory and Practice: The Case of OSHA,” Administrative Law Review 52 (2000): 97, 98 (analyzing the Occupational Safety and Health Administration, which “has completed only a few rules in less than three years, and has taken between four and seven years to complete most rules”).
5. U.S.C. § 553(b) (stating exceptions to the “notice and comment” rulemaking, including policy statements and interpretive rules).
6. 5 U.S.C. §§ 554, 556-58 (formal adjudication); 5 U.S.C. § 555 (informal adjudication).
7. 5 U.S.C. § 706 (2)(E); Universal Camera Corp. v. National Labor Relations Board, 340 U.S. 474, 477 (1951).
8. 5 U.S.C. § 706 (2)(A).
9. United States v. Mead Corp., 533 U.S. 218, 226-27 (2001)
10. Chevron U.S.A., Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837, 843-44 (1984).
11. United States v. Mead Corp., 533 U.S. 218, 231-34 (2001).
12. Motor Vehicle Manufacturers Association of the U.S., Inc. v. State Farm Mutual Automobile Insurance Company, 463 U.S. 29, 44 n.9 (1983) (stating that the Court does not “view as equivalent the presumption of constitutionality afforded legislation drafted by Congress and the presumption of regularity afforded an agency in fulfilling its statutory mandate”).
13. George J. Stigler, “The Theory of Economic Regulation,” Bell Journal of Economics and Management Science 2 (1971): 3.
14. Steven P. Croley, Regulation and Public Interests: The Possibility of Good Regulatory Government (Princeton: Princeton University Press, 2008), 10-11, 254, 256 (stating that some measures of “socially beneficial regulation” include cost-benefit analysis, distributive consequences, expert opinion, and public support)
15. Michael E. Levine and Jennifer L. Florence, “RegulatoryCapture, Public Interest and the PublicAgenda:Toward a Synthesis,” Journal of Law, Economics, and Organization 6 (1990): 167 (discussing possible meanings andmeasures of “public” versus “private” interest and “special” versus “general” interest).
16. For commentary about the role of intensity of preference in the legitimacy of government, see Wojciech Sadurski, “Legitimacy, Political Equality, and Majority Rule,” Ratio Juris 21 (2008): 39
17. Sherman J. Clark, “A Populist Critique of Direct Democracy,” Harvard Law Review 112 (1998): 434.
18. See Croley, Regulation and Public Interests, 14-18
19. Rachel E. Barkow, “Insulating Agencies: Avoiding Capture through Institutional Design,” Texas Law Review 89 (2010): 15, 21-24.
20. 549 U.S. 497 (2007).
21. U.S.C. §701.
22. See Norton v. Southern Utah Wilderness Alliance, 542 U.S. 55 (2004).
23. See Lujan v. National Wildlife Federation, 487 U.S. 871 (1990).
24. I am admittedly assuming that if judges detect regulatory capture, they will try to do something about it, an assumption I cannot defend here.
25. Barkow, “Insulating Agencies,” 15, 27-30.
26. The president’s “directive” authority is a controversial topic. Some argue that unless Congress made explicit the President’s authority, then he does not have it. See, for exmaple, Kevin M. Stack, “The president’s Statutory Powers to Administer the Laws,” Columbia Law Review 106 (2006): 263, 277 (stating that “ … delegations to executive officials alone-‘simple delegations’-should not be read to grant directive authority to the President”). On the other hand, some argue that it is reasonable to interpret a delegation of authority from Congress to an agency as including the president as one who may use that authority.
27. See, for example, Elena Kagan, “Presidential Administration,” Harvard Law Review 114 (2001): 2245, 2326-31.
28. See generally Peter L. Strauss, “Overseer, or ‘The Decider’? The President in Administrative Law,” George Washington Law Review 75 (2007): 696.
29. Ronald M. Levin, “‘Vacation’ at Sea: Judicial Remedies and Equitable Discretion inAdministrative Law,” Duke Law Journal 53 (2003): 291 (discussing the remedial options a court has in a successful challenge to administrative action).
30. Croley, Regulation and Public Interests, 140-42 (stating that “[d]ifferences in economic or political-electoral resources therefore do not translate into different interest groups’ relative ability to subject agency action to judicial review. Therefore, such disparities in interest group resources or political clout do not translate into equal disparities in regulatory influence in the way they may in the legislative arena”).
31. An excellent example can be found in American Horse Protection Association, Inc. v. Lyng, 812 F.2d 1, 5-7 (D.C. Cir. 1987).
32. Jonathan R.Macey, “Promoting Public-Regarding Legislation through Statutory Interpretation: An Interest Group Model,” Columbia Law Review 85 (1986): 223, 263-64.
33. Cary Coglianese points out that the Environmental Protection Agency (EPA), for example, issued 1,568 rules between 1987 and 1991, and yet the EPA was named in a lawsuit only 411 times-a 26 percent litigation rate. Cary Coglianese, “Assessing Consensus: The Promise and Performance of Negotiated Rulemaking,” Duke Law Journal 46 (1997): 1255, 1296-301. Agencies take thousands of other actions that are not rulemakings, few of which are challenged.
34. Cary Coglianese, “Litigating within Relationships: Disputes and Disturbance in the Regulatory Process,” Law and Society Review 30 (1996): 735, 744 (“Organizations most active in rulemaking tend to be most active in litigation.”).
35. Norton v. Southern Utah Wilderness Alliance, 542 U.S. 55 2004
36. Joseph O’Connell, “Political Cycles of Rulemaking,” 889, 918-20
37. M. Elizabeth Magill, “The FirstWord,” William and Mary Bill of Rights Journal 16 (2007): 27, 30-35.
38. Citizens to Preserve Overton Park, Inc. v. Volpe, 401 U.S. 402, 410 (1971) (stating the rebuttable presumption of judicial review of agency action)
39. Abbott Labs. v. Gardner, 387 U.S. 136 (1967), which established this presumption.
40. U.S.C. § 701(a)(1).
41. Ronald M. Levin, “Understanding Unreviewability in Administrative Law,”Minnesota Law Review 74 (1990): 689, 739-40 (discussing an apparent hierarchy the Court uses regarding preclusion).
42. U.S.C. § 701(a)(2).
43. Heckler v. Chaney, 470 U.S. 821, 832-38 (1985) (stating that “an agency’s decision not to take enforcement action should be presumed immune from judicial review under § 701(a)(2)” of the APA and that “[t]he general exception to reviewability provided by § 702(a)(2) for action ‘committed to agency discretion’ remains a narrow one … but within that exception are included agency refusals to institute investigative or enforcement proceedings, unless Congress has indicated otherwise”)
44. Eric Biber, “Two Sides of the Same Coin: Judicial Review of Administrative Agency Action and Inaction,” Virginia Environmental Law Journal 26 (2008): 461.
45. 549 U.S. 497 (2007).
46. For a discussion of Massachusetts v. EPA
47. Ronald A. Cass, “Massachusetts v. EPA
48. The Inconvenient Truth about Precedent,” Virginia Law Review 93 (2007): 75, 80-81.
49. For an attempt to clarify the status of judicial review of action/inaction, see Biber, “Two Sides of the Same Coin.”
50. Daniel T. Deacon, “Deregulation through Nonenforcement,” New York University LawReview85 (2010): 795, 802-04 (discussing Chaney’s holding that “an agency’s decision not to prosecute or enforce … is a decision generally committed to an agency’s absolute discretion” has not been widely adopted in the context of agency refusal to promulgate rules, as exhibited by the Massachusetts v. EPA decision).
51. Stigler, “The Theory of Economic Regulation,” 3, 4-5.
52. Heckler v. Chaney, 470 U.S. 821, 832-33 (1985) (stating that “an agency’s decision not to take enforcement action should be presumed immune from judicial review under § 701(a)(2)” of the APA)
53. Deacon, “Deregulation through Nonenforcement,” 795, 804.
54. 5U.S.C. § 702. For example, 47U.S.C. § 402(b)(6), the Federal Communications Commission, allows “any other person who is aggrieved or whose interests are adversely affected by any order of the Commission” to seek an appeal. Similarly, the Occupational Safety and Health Act of 1970 allows for “person[s] adversely affected or aggrieved” to obtain judicial review (29 U.S.C. § 660).
55. National Credit Union Administration v. First National Bank and Trust Company, 522 U.S. 479, 492 (1998)
56. Association of Data Processing Service Organizations, Inc. v. Camp, 397 U.S. 150, 152 (1970).
57. Lujan v. Defenders of Wildlife, 504 U.S. 555, 562-63 (1992) (stating that “the desire to use or observe an animal species, even for purely esthetic purposes, is undeniably a cognizable interest for the purpose of standing”)
58. Sierra Club v. Morton, 405 U.S. 727, 734 (1972)
59. Animal LegalDefense Fund v. Glickman, 154 F.3d 426, 437 (D.C. Cir. 1998) (en banc) (there is a “myriad [of] cases recognizing individual plaintiffs’ injury in fact based on affronts to their aesthetic interests in observing animals living in humane habitats, or in using pristine environmental areas that have not been despoiled”).
60. The first citizen suit provision was contained in the Clean Air Act of 1970, Pub. L. No. 91-604, 84 Stat. 1676 (codified as amended in scattered sections of 42 U.S.C.). There are also similar provisions in a number of statutes, including the Endangered Species Act of 1973 (16 U.S.C. § 1540(g)); the Surface Mining Control and Reclamation Act of 1977 (30 U.S.C. § 1234-1328)and the Emergency Planning and Community Right-to-Know Act (EPCRA) (scattered sections of 42 U.S.C.).
61. Lujan v. Defenders ofWildlife, 504 U.S. 555, 568-71 (1992) (discussing the requirement of redressability, specifically that even if a decision were made in the environmental group’s favor, the injury complained of would not be redressed).
62. Lujan v. Defenders ofWildlife, 561-62
63. Block v. Community Nutrition Institute, 467 U.S. 340, 346-47 (1984)
64. Karl S. Coplan, “Ideological Plaintiffs, Administrative Lawmaking, Standing, and the Petition Clause,”Maine Law Review61 (2009): 377, 404-08
65. Glen Staszewski,” The Federal Inaction Commission,” Emory Law Journal 59 (2009): 369, 370-71 (“Simply put, regulated entities have access to legal relief when they challenge unduly aggressive agency action, whereas regulatory beneficiaries do not have access to legal relief when they allege that an agency has failed to implement its statutory mandate.”).