The Administrative State at Work and Play

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More and more, our administrative state looks like something dreamt up in a late-night meeting between Carl Schmitt and Evita Peron. I’m teaching something called, fraudulently, administrative “law.” Believe you me: nothing in that corpus juris poses any meaningful constraint on government. E.g., I’m supposed to teach and therefore do teach that judges must bow to any bureaucrat’s take on the law (unless it’s completely nuts) because otherwise the D.C. Circuit might end up running the country and good sense and lawful government might break out.

(That, mind you, is the dominant conservative position. The dominant liberal position is that behavioral economics will guide and constrain administrators. If you don’t believe that you probably suffer from excessive risk aversion or some other perception bias. Repair to Harvard Law School: Doctor Sunstein will cure you in an instant.)

I don’t know what to do about the pathologies of the administrative state. But I know just the forum to explore them.

For some years now, my buddy Michael Zoeller and I have run a project called the Transatlantic Law Forum. Michael is truly one of a kind: a German (!) sociologist (!) of a decided classical-liberal bent—erudite and entrepreneurial to boot. (He founded and runs the Council on Public Policy, an independent think tank. No small matter, in a country where political parties monopolize and therefore stifle expertise and thinking.) Our objective is to create a transatlantic community of scholars, judges, lawyers, and legal journalists who take constitutionalism seriously.

Go ahead: lol. But there a transatlantic something for everyone, from government officials to antitrust lawyers to the defenders of transgendered toads: why can’t we have our own? As Danny Webster might have said and in fact did say, it’s a small institution, but there are those of us who like it.

TLF’s conferences alternate between Washington and Hamburg, Germany—my hometown and, more important for present purposes, home to our host institution, Bucerius Law School: Germany’s only private law school, and therefore its very best.

This year’s conference, on “The Rule of Law and the Administrative State in Crisis,” will be held at George Mason Law School’s Law & Economics Center. We’ve managed to assemble a terrific crowd of thinkers and practitioners. The program conveys a sense of the range of questions. Here are some:

  • For decades, American conservatives have wailed about independent agencies—a “headless Fourth Branch” of government. But that isn’t really how the modern administrative state operates—is it? Major extra-legal initiatives—a “Dream Act” through non-enforcement, a global warming program under a statute built for very different purposes—are run more or less directly from the White House. Similarly, during the financial crisis, everything ran together in Mr. Paulson’s office. He was the Secretary of the Treasury, and he did what he would have done at Goldman Sachs: buy, sell, crush kneecaps, keep the markets guessing. He did all this practically at the feet of the President: the “unitary executive,” anyone? Judicial “deference,” anybody (none of the decisions were or are reviewable in any meaningful way)? The Dodd-Frank Act has on most accounts institutionalized this m.o. Government at long last run like a business: Happy now?
  • Legislators around the world have been incapacitated. In Europe, their job is to “transpose” directives from the EU; in the U.S., it’s to get really good at Sudoku (especially if you’re a Senator) and let the sprawling executive apparatus do its thing. Is that a good thing, for all the usual public choice reasons? A bad thing, for all the antiquated constitutional reasons? An inevitable concomitant of modern government, and therefore not worth worrying about?
  • There’s one hugely powerful argument for the administrative state, and it appears in Plato’s Republic: Democracy is the rule of the many. The many are stupid. Therefore, democracy is stupid. Okay: it’s a bit more subtle. Point is, though, there are some things where you want stability, and therefore “undemocratic” institutions. Here’s the catch: we’re deliberately creating completely independent government institutions, such as the Consumer Financial Protection Board, with a mission to de-stabilize private arrangements that work perfectly well (or would work well if government and its sponsored agencies hadn’t messed them up). Meanwhile, the institutions that you really want to be beyond democratic demands, like central banks, manage the stock markets and bankroll the politicians on a day-to-day basis. Eventually, they’ll inherit the instabilities they are supposed to contain, as when the Fed runs a $3 trillion book on something like $50 billion equity. Am I the only one to find this unsettling?

Just asking. I’m looking forward to the conference.