Reconstructing the Administrative State

Blake Emerson –

In the early weeks of the Trump presidency, Steve Bannon declared that one of its principal tasks would be the “deconstruction of the administrative state.” Though Bannon has since left the White House, this project has so far proved one of its most enduring preoccupations. Administrative bodies such as the Environmental Protection Agency, Departments of Health and Human Services, Justice, and Education, and Federal Communications Commission have reversed course on key progressive initiatives such as reductions in carbon emissions, healthcare insurance enrollment, police reform, redress of campus sexual harassment and assault, and net neutrality.

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The tenured civil service is being sidelined, or even targeted by opposition research firms hired by their own departments. The recently enacted tax bill promises to starve the government of the resources to sustain the remaining pillars of the welfare state, namely Medicare, Medicaid and Social Security. And the appointment of Justice Gorsuch to the Supreme Court casts doubt on the future of a core principle of administrative law—that courts should defer to agencies’ reasonable interpretations of statutory ambiguities.

This effort to rein-in the regulatory state has been at the center of the conservative agenda since the 1930s, and ascendant since Reagan. It overlaps with a broader neoliberal policy framework that many centrist Democrats share, which remains skeptical of the public provision of goods and services, and “command-and-control” regulation. Bill Clinton’s bipartisan mantra that “the era of big government is over” has steadily eroded regulatory and welfare institutions, and fulfilled its own prophecy that bureaucrats are incapable of promoting the public good.

As we near the pinnacle of this era of governance, Bannon’s declaration throws into relief a constituent feature of any viable counter-movement. If we are to develop a political program capable of rescuing the American polity from private domination, economic inequality, and caste hierarchy, we must think through what kind of administrative apparatus could carry that program into action. One that sees its role primarily as correcting market failures, “nudging” individuals to make decisions the expert deems wise, and maximizing aggregate social welfare, is likely to simply reproduce the logic of private enterprise within government.

The hegemonic framework for policy reasoning today—cost-benefit analysis—attempts to approximate market pricing where it does not exist, asking, for example, how much people are “willing to pay” to avoid certain kinds of harms. Such methods can be useful in ensuring that decision-makers fully take into account the economic effects of proposed courses of action. But they instill a regulatory ideology where the model of formally free, reciprocal, and competitive exchange predominates over the practice of joint action motivated by a common aim. We come to approach even political rights and obligations as priced commodities rather than as products of either reasoned agreement or social struggle. Instead of a cost-benefit state, we need a state that simulates an egalitarian society and stimulates a democratic politics.

We need not start from scratch. As K. Sabeel Rahman has shown, Progressives like John Dewey and Justice Brandeis developed a substantively and procedurally democratic model of the regulatory state in the early twentieth century. Legislative action would aim to thwart social domination, while the administrative process would engage the people in interpreting and implementing those laws.

The Progressive movement did not develop these ideas out of whole cloth, however. Hegel’s thought proved particularly influential on American progressive state theory, providing American thinkers with a trenchant critique of the marketplace and contrasting ideals of political community. The Hegelian ideal of the state incorporated but fundamentally transformed liberal constitutional norms. Hegel recognized that rights of property and contract provided a kind of “abstract,” formal freedom, commanding subjects to “be a person and respect others as persons.” But he argued that when these rights were exercised in the context of the market, they often operated to deprive people of their freedom. He recognized that “private use of property also has external relations . . . which can wrong or harm other people.” Complex industrial economies are “dependent on external circumstances and remote combinations whose full implications cannot be grasped by . . . individuals.” The “system of needs” of the market place created endemic poverty, as some members would fall inevitably fall below the social minimum necessary to survive without charitable support.

The liberal legal regime therefore did not live up to its promise of protecting freedom, because individuals could not be autonomous agents where the social world confronted them as perilous, alien, and beyond their control. “The state,” Hegel argued, would remedy these failures, making freedom a “concrete” reality for all citizens. It was defined by “the law which permeates all relations within it and also the customs and consciousness of the individuals who belong to it.” This state, constituted by a sense of mutual obligation and interdependence, would address the failures and excesses of the economic marketplace. Such welfare and regulatory services would be authorized by statutory law, but would be carried out by a “universal class” of well-educated, principled, and socially conscious civil servants.

Progressive theorists embraced this Hegelian ideal of the bureaucratic state. W.E.B. Du Bois, for example, was educated in the Hegelian tradition of bureaucratic reform during his study with Gustav Schmoller and Rudolf von Gneist in Berlin. In his account of Reconstruction in The Souls of Black Folk, he argued that the federal provision of welfare benefits and legal protections for African Americans in the wake of the Civil War provided a model for a “permanent Freedmen’s Bureau” that would give freed people the capacity to participate as equals in society. Economists like Richard T. Ely likewise embraced Hegelian visions of the state as an “ethical agency” that would constitute and secure individuals’ freedom against the inequality, domination, and bodily injury caused by the industrial economy. Henry Carter Adams similarly argued “that the individual is a part of the State, and that he realizes his individuality, in some degree at least, because the State exists.” As Ajay Mehrotra has shown, Progressives like Adams and Edwin Seligman maintained that, because the political community constituted each citizen’s identity and interests, it made no sense to think of tax as payment for discrete benefits received. Instead, contribution to public expenditures should be governed by principles of equity and justice, or each person’s relative “ability to pay.”

The Progressive theory of the state did not merely parrot Hegelianism, however. Rather, it redressed one of the most fundamental failures of his theory—his rejection of popular sovereignty and democratic principles. Hegel had sought to insulate the state from public opinion, arguing that public opinion was prone to error, and that tenured civil servants alone could hold the impartial perspective from which to govern antagonistic social groups. The Progressives sought to democratize this ideal, arguing for deep and pervasive public participation in the administrative process. John Dewey, for instance, insisted that “[n]o government by experts in which the masses do not have a chance to inform the experts as to their needs can be anything but an oligarchy managed in the interests of the few. And the enlightenment must proceed in a way which forces the administrative specialist to take account of the needs.” Follett likewise argued that “administrative responsibility and expert service are as necessary a part of genuine democracy as popular control is a necessary compliment of administrative responsibility.” She proposed “experience meetings” between experts and the public that would inform civil servants of public needs and understandings, while at the same time improving public comprehension of the problem at hand.

This vision was not a castle in the clouds. Rather, it reflected certain aspects of Progressive Era administrative practice. As Follett argued, Progressive regulatory agencies created a kind of “circular response” between civil society and regulatory laws. The Federal Trade Commission, for example, would solicit the opinions of affected firms within an industry to determine if a given trade practice was “unfair.” The Forest Service likewise held intensive deliberative hearings with cattle ranchers in setting grazing quotas on federal lands. This project was carried forward during the New Deal, as The Tennessee Valley Authority, the Agricultural Adjustment Administration, and the Bureau of Agricultural Economics determined land use policy in consultation with farmers.

The Hegelian Progressive legacy is worth recovering for a future progressive political agenda. We need to reconstruct an administrative state that engages with the persons it affects in implementing the laws that bind them. In this way, the people can be at once subject and authors of the regulations that provide for their collective welfare. This practice of consultation should go far beyond the routine “notice-and-comment” process required by the Administrative Procedure Act, which is primarily responsive to technical and inaccessible legal and policy arguments. At the same time, administrative procedure must be structured so as to counterbalance the inequalities of money, power, and influence that pervade society and the marketplace. The ranks of the civil service must possess a complementary professional culture that prizes social equality as a substantive end to be advanced in the exercise of their discretion. For the legal academy, this means teaching regulatory state and administrative law courses in a way that underscore the democratic, rather than formally legalistic, functions of the administrative process. This will inform the thinking and practice of students who might one day serve in an agency’s Office of General Counsel, or a public interest organization that is in constant dialogue (or conflict) with agencies. Without these procedural and professional adjustments, it is likely that the administrative state will simply reproduce the very pathologies it ought to remedy.

For scholars and practitioners of administrative law, the Trump Administration presents immediate challenges: to contest unlawful executive action, to protect successful elements of our current regulatory framework, and to shield the civil service from evisceration. At the same time, however, we need to keep our eye on the horizon, and develop a transformative institutional and ideological vision for a progressive future. In future posts, I hope to examine some highly contested policy areas from an administrative law perspective—areas such as immigration enforcement and internet regulation—to show how we might address them in a more inclusive, rational, and egalitarian fashion.

Blake Emerson is Assistant Professor of Law at UCLA School of Law.