the case for gridlock, cato policy analysis no. 672

8/7/2019 The Case for Gridlock, Cato Policy Analysis No. 672

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Executive Summary

In the wake of the 2010 elections, Presi-dent Obama declared that voters did not givea mandate to gridlock. His statement reflectsover a century of Progressive hostility to theinefficient and slow system of government cre-ated by the American Framers. Convinced thatthe government created by the Constitutionfrustrates their goals, Progressives have longsought ways around its checks and balances.

Perhaps the most important of their methodsis delegating power to administrative agencies,an arrangement that greatly transformed U.S.government during and after the New Deal. Forgenerations, Progressives have supported thefalse premise that administrative action in thehands of experts will realize the public interestmore effectively than the constitutional system

and its multiple vetoes over policy changes. Thepolitical effect of empowering the administra-tive state has been quite different: it fosters poli-cies that reflect the interests of those with well-organized power. A large and growing body of evidence makes it clear that the public interestis most secure when governmental institutionsare inefficient decisionmakers. An arrangementthat brings diverse interests into a complex,

sluggish decisionmaking process is generally unattractive to special interests. Gridlock alsoneutralizes some political benefits that produc-er groups and other well-heeled interests inher-ently enjoy. By fostering gridlock, the U.S. Con-stitution increases the likelihood that policieswill reflect broad, unorganized interests insteadof the interests of narrow, organized groups.

The Case for Gridlockby Marcus E. Ethridge

No. 672 January 27, 2011

Marcus E. Ethridge is professor of political science at the University of Wisconsin–Milwaukee and the author of The Case for Gridlock: Democracy, Organized Power, and the Legal Foundations of AmericanGovernment (Lanham: Lexington Books, 2010).



Introduction

It has been clear for some time now thatthe second half of President Obama’s first

term will be marked by deep gridlock. Giv-en the composition of the 112th Congress,passing major legislation will be very dif-ficult. However, while the congressional-presidential system is in gridlock, a greatdeal of energetic lawmaking will take placeoutside the constitutional system. By con-tinuing—and expanding—the delegation of legislative power to “unicameral” executiveagencies, the Obama administration and itsallies in Congress will use a highly efficientway to make policy. The contrast between

these two processes for producing legisla-tion will give us an excellent opportunity to appreciate the virtues of the protracted,frustrating institutional arrangement setforth by the Framers.

According to one expert, the Dodd-FrankFinancial Reform Act will lead to at least243 separate instances of administrativerulemaking, involving nine different agen-cies and commissions.1 The Obama admin-istration has already used administrative“legislation” to make policy on off-shore oil

drilling, stem-cell research, and a variety of environmental issues. And the Departmentof Health and Human Services has grantedmore than 200 waivers from key provisionsof the new health care reform. In deeply im-portant ways, non-elected officials are mak-ing the public’s policies.

Ever since the time of Woodrow Wilson,Progressives have argued that policymakingby expert executive agencies is far superiorto the “antique” legislative process craftedby the Constitution’s Framers. Just as they

argued a century ago, modern Progressivescontend that moving legislative authority outside the congressional-presidential sys-tem will lead to more efficient and informedpolicymaking. But they also argue that, by circumventing the gridlock-prone institu-tional arrangement, policies that advancesocial equality and progress will no longer

be obstructed by commercial interests. Re-ducing the role of gridlock-prone institu-tions will thus lead to a more just and pro-gressive society.

However, the Progressive vision is pro-

foundly wrong. Decades of experience andresearch on interest groups and the work-ings of administrative policymaking clearlydemonstrate that the more efficiently re-sponsive the government is, the greater theinfluence of interests that enjoy the politi-cal advantages of superior organization. Areturn to the frustrating, sluggish, gridlock-prone system of legislation set forth in theConstitution will actually enhance repre-sentation of broad, unorganized, public in-terests.

Progressivism and Gridlock

In 2006, Nobel laureate Paul Krugmanspoke for many politicians and academ-ics, including several who would becomeinfluential members of the Obama admin-istration, when he offered this assessmentof contemporary U.S. inequality: “It is nothard to foresee, in the current state of ourpolitical and economic scene, the outline

of a transformation into a permanently un-equal society—one that locks in and perpet-uates the drastic economic polarization thatis already dangerously far advanced.”2 Krug-man’s complaint was remarkably consistentwith the views of Progressive commenta-tors from previous generations.3 TheodoreRoosevelt argued that big business was aspecial interest that enjoyed disproportion-ate power.4 A quarter-century later, FranklinRoosevelt remarked: “For too many of usthe political equality we once had was mean-

ingless in the face of economic inequality.”Equality, depending on the way it is mea-

sured, has varied considerably over the lastcentury. But the Progressive argument that(a) inequality has reached intolerable lev-els, and (b) the political power of wealthyinterests obstructs efforts to reduce it, hasremained unchanged for generations.

2

The moreefficiently

responsivegovernment is,

the greater theinfluence of

interests thatenjoy thepolitical

advantages of superior

organization.



The persistence of the Progressive com-plaint about social and economic equality isperplexing in light of the policies and pro-grams that were adopted between the timeof Teddy Roosevelt and Paul Krugman. In

the decades between 1910 and today, U.S.society experienced the imposition of andmassive expansion of the income tax, exten-sive government regulation of the privatesector, and a series of entitlement programsenacted during the New Deal and the GreatSociety eras that now account for most of a very large government budget. If a timemachine could bring TR to the present, hewould doubtlessly be stunned to find con-temporary commentators writing bitterly about “savage inequalities” and a “perma-

nent lower class” after the successful adop-tion of so many landmark Progressive ini-tiatives.

How can such inequalities persist after somany Progressive programs were implement-ed? The answer is not simply that Progres-sive policies have unintended consequencesor that they are based on flawed ideas abouteconomics (although such criticisms are fre-quently on target). The deeper problem isthat the institutional changes made to craftand implement these policies increased the

political power of the well organized. Mov-ing much of the legislative process to execu-tive branch agencies certainly made lawmak-ing more efficient, but it also had politicalconsequences that undermined Progressivegoals. Contrary to heated statements fromProgressives from TR to Krugman, the casefor gridlock is the case for equality and therepresentation of broad interests.

A 1984 Supreme Court decision, aston-ishing in its frankness, provides a compel-ling illustration of the power of organized

interests in efficiently responsive institu-tional settings. In Block v. Community Nu-trition Institute, a group advocating for theinterests of the poor challenged an Agri-culture Department “milk-market order.”For decades, agricultural interests had per-suaded the department to use the statutory authority granted by Congress to raise milk

prices, enriching them at the expense of consumers. The community group wantedthe Department to consider the effect of itsaction on consumers, especially the poor. Justice Sandra Day O’Connor rejected their

claims as she wrote for a unanimous court:

Congress intended that judicial rev-iew of market orders ordinarily beconfined to suits by [dairy] handlers.. . . Allowing consumers to sue theSecretary would severely disrupt the Act’s complex and delicate adminis-trative scheme . . . [T]he congressio-nal intent to preclude consumer suitsis “fairly discernible” in the detail of the legislative scheme. The Act contem-

plates a cooperative venture among theSecretary, producers, and handlers; consumer participation is not provided for or desired under that scheme.5

This case not only reveals that interest-group power can influence policy, but itshows how it does so most effectively in anefficient institutional context . The AgricultureDepartment adopted its milk-market ordersin a setting without bicameralism, withoutinterinstitutional competition, and with

the participation of a clearly targeted in-terest. Progressives strongly supported theexpansion of the Agriculture Department’spowers during the New Deal. But the effi-cient responsiveness that their reforms cre-ated frequently undercut Progressive policy goals.

A generation of research on the way or-ganized interests influence government am-ply demonstrates that the gridlock-proneconstitutional system obstructs “rent seek-ing” and other forms of influence by privi-

leged political organizations far more thanit obstructs influence by the unorganized.6 The tragedy of Progressivism is that, in itsfrustration with the existence of social andpolitical inequality, it demands the estab-lishment of institutions that amplify thepolitical advantages of superior organiza-tion.

3

Thegridlock-proneconstitutionalsystem obstruct“rent seeking”far more thanit obstructsinfluence by theunorganized.



4

The vast majority of laws are now

made inunicameral

administrativebodies.

Progressivism’s Claim that InstitutionalEfficiency Advances Social Equality

The idea that the Constitution’s gridlock-prone institutions worsen social equality is a bedrock Progressive principle, made explicit

in James Allen Smith’s The Spirit of Ameri-can Government in 1906. For Smith, CharlesBeard, and other Progressives of their time,the constitutional arrangement of govern-ment institutions was a critical obstacle toprogress.7 Later Progressives developed theidea. Following mid-century pluralists likeDavid Truman, they accepted the idea thatnearly all interests—including the poor, la-bor, consumers, and even taxpayers—can berepresented by effective political organiza-tions.8 Consequently, if the political system

fails to achieve social equality, there must besomething in the design of governmentalinstitutions that stands in the way of prog-ress. Progressive thinkers attributed thisfailure to the gridlock-prone institutionalarrangement that the Framers left us. Thus,most Progressives believe that it is not nec-essary to have a thoroughgoing revolutionas Marxists and other radicals claimed—cir-cumventing gridlock would naturally pro-duce a more progressive and just society.

Some of the most cited political scientists

of the century agreed. James MacGregorBurns’s The Deadlock of Democracy (1963) ex-pressed frustration with a system that hadto be forcibly attacked by activist presidentsto produce results: “Even the strongest andablest presidents have been, in the end, morethe victims of the Madisonian system thanthe masters of it.”9 His criticism of institu-tional gridlock clearly embodied the Pro-gressive view that, if only the archaic checksand balances were removed (or circumvent-ed), majority interests would flourish. Simi-

larly, in what became a mid-century classicof political science, Robert Dahl argued that“Madison’s nicely contrived system of con-stitutional checks” prevented the poor fromhaving “anything like equal control overgovernment policy.”10

New Dealer James Landis argued thatthe frustrations and delays produced by the

Madisonian system could be circumventedan approach far easier than explicit consti-tutional change. In 1938, he wrote The Ad-ministrative Process, a book that legitimizedmuch of what FDR had done, while laying

the foundation for continued support forthe Progressive way of thinking for subse-quent generations:

So much in the way of hope for therealization of claims to a better liveli-hood has, since the turn of the centu-ry, been made to rest upon the admin-istrative process. To arm it with themeans to effectuate those hopes is butto preserve the current of Americanliving. . . . The administrative pro-

cess springs from the inadequacy of a simple tripartite form of governmentto deal with modern problems. . . .[O]ur age must tolerate much morelightly the inefficiencies in the art of government.11

Following this logic, Progressives workedsuccessfully to change American institutionsdramatically during the last century. The vast majority of laws are now made in uni-cameral administrative bodies, as Congress

delegates many difficult decisions to agen-cies, and courts evolved a strong doctrine ofdeference to administrative judgments. TheProgressive vision succeeded dramatically increating a system in which government poli-cymaking could be more efficient than theantique system designed by the Framers.

The Obama administration and its al-lies in Congress have fully embraced theProgressive approach. Even with strongDemocratic majorities, it was difficult toenact the President’s major legislative ac-

complishments (health care reform and theDodd-Frank Financial Reform Act). If thebills had included provisions that explicitlydecided virtually all the major policy choic-es involved, their passage would not havebeen possible. Consequently, all of Obama’ssignificant legislative successes providedfor the delegation of legislative authority to a



5

variety of executive branch commissionsand agencies, side-stepping some of thedifficult political decisions. Moving someimportant legislative tasks outside the grid-lock-prone constitutional system made it

possible to pass these landmark bills.With a breathtaking disregard for theConstitution’s first section (“All legislativePowers herein granted shall be vested in a Congress of the United States, which shallconsist of a Senate and House of Represen-tatives”), members of Congress were put onnotice that if they failed to pass the admin-istration’s favored climate-change legisla-tion, the Environmental Protection Agency would resolve the issue by using its power torestrict carbon-dioxide emissions as a “pol-

lutant.”12

It is a stunning demonstration of Progressivism’s hold that so few citizens orcommentators found this explicit assault onbasic constitutional provisions noteworthy.

But Progressives have long contendedthat undermining or ignoring the legis-lative vesting clause is necessary in orderto achieve progress and social equality. Inlarge measure, the failure of Progressivismto achieve its goals is a function of Progres-sive delusions regarding how organized in-terests attempt to influence government.

James Madison understood the problemquite well, and research by political scien-tists and economists has confirmed that his view remains more useful than the oppos-ing arguments set out by Smith, Landis, andKrugman.

Why Progressive Institutions Fail:The Interest Group System Can Not BeRepresentative

In 1965, Mancur Olson Jr. wrote a land-mark book (The Logic of Collective Action)

that provided a theoretical explanation forwhat many citizens and political insidershad long appreciated: some interests are farmore capable than others of producing ef-fective organizations to advance their goals,and these fortunate interests are never thelargest ones (they are not consumers, tax-payers, or the poor).13 If Olson is correct, the

Progressive devotion to the administrativestate cannot be reconciled with their con-cern for equality.

Olson argued that individuals will notnormally contribute to a collective effort to

advance their interests, even if those inter-ests are important to them. Since a singlecontributor’s effort and resources will haveno real impact on the chances that the col-lective effort will be successful, and sincenoncontributors will receive benefits fromany collective effort that is successful, therational individual will not contribute. Themost important implication of this idea (still largely unappreciated by Olson’s nu-merous critics), is that there is no necessary correspondence between the array of politi-

cal interests in society and the array of orga-nized political forces working to influencegovernment.

Several analysts have argued that theexistence of organized political forces notanticipated by Olson undercuts his ba-sic idea. The Sierra Club, the NAACP, andNOW are important political actors, eventhough they depend on voluntary collectiveaction.14 While the mere founding of someof these organizations seems inconsistentwith Olson’s logic, such a criticism ignores

the crucial point. When evaluating the dis-tributive impact of institutional change, itis the relative political influence of compet-ing interests that becomes critical. Even if we can identify a wide variety of politicalorganizations that have somehow managedto exist and to set up lobbying operationsin Washington, the free-rider problem sug-gests that groups will vary dramatically withrespect to how much collective effort they get from those who share their collectiveinterests: “More than 50 million Americans

. . . value a wholesome environment, but ina typical year probably fewer than one ina hundred pays dues to any organizationwhose main activity is lobbying for a betterenvironment. The proportion of physiciansin the American Medical Association, orautomobile workers in the United Automo-bile Workers union, or farmers in the Farm

There is nonecessary correspondencebetween the arra

of politicalinterests insociety and thearray of organizedpolitical forcesworking toinfluencegovernment.



6

The efficientinstitutionalarrangement

Progressivismgave us produced

disturbinginstances of

special interestinfluence on

agency policy decisions.

Bureau, or manufacturers in trade associa-tions is incomparably greater.”15 Olson’s in-sight suggests that the array of organizedlobbies active at any given time will not mir-ror the array of interests in society.

The critical issue for evaluating the Pro-gressive position on the Constitution’s law-making process is the extent to which theforces of organized political life, taken to-gether, are democratically representative.Even if analysts are able to identify politicalorganizations whose existence seems to chal-lenge the validity of the free-rider problem,the conclusion that the balance of organizedforces will not mirror the balance of politicalinterests is unavoidable.16

Three Failed Progressive Reform EffortsGiven the inherent organizational ad-

vantages that certain interests enjoy, it wasinevitable that the efficient institutional ar-rangement that Progressivism gave us wouldproduce disturbing instances of special in-terest influence on agency policy decisions.Progressives advocated reforms intended tobring a broader range of interests into agen-cy decisionmaking, hoping that the efficientsystem they created to circumvent gridlockcould be preserved. Although each of these

reforms has failed, the fact that they were(and are) advocated by Progressives revealsthat their understanding of political life re-mains inferior to that of the Framers.

Citizen Participation. Prompted by the in-creasing importance of administrative deci-sions, Progressives have long advocated pro-cedures providing for citizen participationin agency rulemaking. It is difficult to arguethat procedures designed to ensure open-ness and accountability are valueless. How-ever, those observing the workings of citizen

involvement in administrative hearings haveconsistently found that the procedures thatprovide for these inputs are generally help-ful only to those who already enjoy the po-litical advantages of superior organization.For example, over 30 years ago, studies of citizen participation in environmental poli-cy hearings concluded that the most typical

participants were officials from other agen-cies or representatives of political organiza-tions that already enjoyed on-going access.17

More recent research indicates that thingsare little changed. McKay and Yackee ana-

lyzed data from several agencies, measuringthe extent to which policy change was as-sociated with the level of organized interestinvolvement. Their conclusions are striking

We find strong evidence that federalbureaucrats listen to interest groupsand tend to favor the more dominantside. . . . [W]hen federal agency officialsreceive strong, loud, and united mes-sages from interest groups, they areresponsive.18

Agency officials are responsive—they arenot always aloof technocrats making deci-sions only on the basis of professional stan-dards and technical calculations. However,the responsiveness produced by requiredprocedures for open hearings and otherreforms is not responsiveness to broad in-terests. There are exceptions, of course, butdecades of experience confirm that the pub-lic hearing requirement creates only the ap-pearance of “participatory democracy.”19

A 2008 report, “Transparency and PublicParticipation in the Rulemaking Process,”was hopeful regarding the prospects forpublic involvement in agency decisionmak-ing, but it found that the familiar problemsdo exist. A group of 13 leading scholarsfound that agencies are insufficiently trans-parent when they begin the rulemaking pro-cess, that “agencies too often fail to reachout to all interest groups in an even-handedmanner,” and that they frequently do notcreate a process in which “dialogue and in-

teraction” take place. The task force recom-mended that agencies take steps to ensurethat “all interests are represented in therulemaking process” and that they shouldmaintain “‘open-door’ policies.”20

Some expected the expansion of e-rule-making, in which citizens can submit their views electronically, would promote broader



7

representation in agency decisions. How-ever, the initial reports are not favorable.Recent studies concluded that e-rulemakinghas made public participation neither morerepresentative nor more persuasive.21 Simi-

larly, Cary Coglianese completed an exten-sive empirical analysis of e-rulemaking, lead-ing to his stark assessment that “regulatory agencies continue to garner only the mostmodest, if not trivial, level of involvementby ordinary citizens. . . . The chief barriers tocitizen participation in rulemakings are nottechnological.”22

The Legislative Veto. Although it firstappeared in the 1930s, the legislative vetobecame an increasingly popular statutory provision during the 1960s and 1970s. Leg-

islative veto provisions took several differ-ent forms, including the power to veto ad-ministrative decisions by one house or evenone committee. Even when legislative vetoprovisions required a joint House-Senateresolution, presentment to the presidentwas not required. Thus, the characteristicelement of the legislative veto was the useof legislative power to reverse or block anadministrative decision without having toenact a statute. The Supreme Court held in1983 that the legislative veto was unconsti-

tutional because it allowed Congress to actwithout observing the principles of bicam-eralism and presentment to the president.23

Proponents of the legislative veto arguedthat the mechanism is an effective methodthrough which legislators can superviseadministrators more effectively. They con-tended that the device helped to restore a balance of power between agencies and thelegislature, because agencies, unlike leg-islatures, can make decisions quickly andquietly. When these choices are contrary

to legislative intent or in excess of legisla-tive authority, a legislature that can only block agency actions through statutory re- vision will be unable to “correct” many suchchoices (or even to threaten to do so). Theostensible political rationale for the legisla-tive veto was that it was an efficient mecha-nism for “reining in” lawless or overzealous

administrative officials.24 In general terms,the increasing popularity of legislative vetoprovisions was consistent with the sameemerging anti-bureaucratic mood that wasapparent in court cases like Office of Com-

munication of the United Church of Christ v. FCC (a 1966 case that required the FCC toallow public interest groups to “intervene”in licensing hearings) and Citizens to PreserveOverton Park v. Volpe in 1971 (which forcedthe Secretary of Transportation to explainhow his approval of a state freeway plan wasconsistent with federal law).25

However, it would be simplistic and in-complete to see the legislative veto entirely as a result of legislative frustration withimperialistic bureaucrats. As in the case of

procedural complexity, administrators andtheir academic advocates would come tosupport the legislative veto and, more im-portant, organized interests would come toprofit from its existence. In an era of weak-ened faith in bureaucratic independence,the presence of a legislative veto provisionin a statute containing a grant of power toan agency or commission apparently madeCongress more comfortable with the idea of delegation. Since administrative actionswould typically be presented to Congress

(in the form of proposed rules) so that onehouse or committee could scrutinize, andpotentially veto, any actions deemed unwiseor inappropriate, the legislative veto madeadministrative power seem more benign.

Thus, while the legislative veto was advocated as a means of checking specific ap-plications of administrative discretion, it islikely that by lowering the perceived costsof delegation, the veto led Congress to del-egate more. Among administrators, the con- ventional wisdom about the legislative veto

was fervently expressed in a critical essay in the Public Administration Review by LouisFisher, who argued that the legislative vetowas an important and valuable tool that cre-ated necessary flexibility for both legislatorsand administrators.26 Even as early as 1938, James Landis recognized that the existenceof legislative veto powers could actually

The legislative veto madeadministrativepower seem morbenign.



8

strengthen the scope of authority grantedto administrators.27 While it doubtlessly ap-peared threatening to agency autonomy insome contexts, the professional administra-tive community came to support the legis-

lative veto device because, like proceduralcomplexity, it made legislative grants of ad-ministrative power more palatable.

There are good reasons to suppose thatthe legislative veto enhanced the political po-sition of organized interests. Veto provisionsproliferated in statutes during the same pe-riod in which interest groups became morenumerous and diverse. Why would this bethe case? Inevitably, meaningful competi-tion among diverse organized interests pro-duced situations in which groups that had

been previously unopposed in their “sub-system” relationships with administrativeagencies encountered occasionally effectiveresistance. Contrary to the typical situationsin the “iron triangles” of an earlier period, a single organized interest rarely enjoys exclu-sive dominance in contemporary “issue net-works.” Existing rent-producing restrictionswere sometimes challenged, while in othercases groups demanded regulations whichwould actually promote more meaningfulcompetition.

Rent seekers finding themselves in op-position to these policy changes and unwel-come requirements sometimes lobby Con-gress to reverse them. In a few cases, suchgroups were notably successful in obtainingreversals of agency actions through legisla-tion.28 However, moving Congress to reverseagency policies is difficult and expensive.29 A rent-seeking interest that has increasingly encountered sporadic administrative deci-sions made in response to the demands of organized opponents will find favor in a se-

lectively applied tool such as the legislative veto. Just as such interests benefit from ef-ficiently responsive institutional authority when seeking profitable applications of gov-ernment power; they can best preserve bene-ficial policies by having a specifically target-ed, relatively flexible mechanism available tocheck particular administrative actions. The

mechanism enabled legislators to respondefficiently to influential interests disturbedby the occasionally unwanted regulatoryinitiative. It also served the interests of legis-lators: it allowed them to benefit politically

by enacting broad regulatory powers and byreserving a response option to be selectivelyapplied when effectively demanded.30

The legislative veto was the subject of sev-eral empirical studies during the 1970s and1980s, and it is striking that virtually all ofthem assessed its political impact as adverseto broad public interests.31 The efficient de-cisionmaking made possible by the mecha-nism was especially useful to opponentsof public-interest-group positions becausepublic-interest groups tend to exhaust their

resources in initial agency hearings (leavingthem outgunned in subsequent proceed-ings), and because congressional committeehearings are even more exclusively accessibleto insiders than agency hearings. Anotherobserver reached the same conclusion someyears later:

Powerful, well-organized special inter-ests, confident of their ability to main-tain an effective, well-financed politicalcoalition, will place a high premium on

a legislative veto because such groupswill expect to be able to control futureCongresses or congressional commit-tees. . . . Without the legislative veto,special interest legislation will be lessattractive to powerful special interestgroups.32

“Hard Look” Judicial Review. As therepresentational problems created by Pro-gressive institutional reform became in-creasingly apparent, some argued that the

courts could correct errant administrativedecisions—reversing or modifying decisionsthat agencies made as a result of interest-group pressure. But Progressives wouldfind that courts have not been consistent intheir approach to deference, and sometimestheir application of deference (or their with-holding of it) has had policy impacts Pro-

The legislative veto enhanced the

political positionof organized

interests.



9

A century of Progressivesuccess intransferringlegislative poweoutside theMadisoniansystem has leftthe proponents

of socialequality severelydisappointed.

gressives view as unhelpful to social equal-ity.

It is very unlikely that judicial review willshape public policy in any consistent direc-tion. Two important administrative defer-

ence cases, NLRB v. Hearst (1944) and Chev-ron v. Natural Resources Defense Council (1984),illustrate the problem.33 In both cases, thecourts deferred to the judgments of agency officials. In the earlier case, Progressiveslauded judicial affirmation of the NationalLabor Relations Board’s desire to extendits jurisdiction.34 However, Progressives de-cried Chevron’s judicial deference to theEPA’s decisions because they implementedthe Reagan administration’s agenda regard-ing environmental policy.35 There are other

cases that illustrate that judicial review of administrative choices has politically incon-sistent policy impacts.36

Progressives have thus been frustratedby judicial decisions regarding agency poli-cymaking—they want courts to defer to ad-ministrative decisions when those decisionsadvance Progressive goals and to reverse orobstruct agency decisions they oppose. Theproblem is that courts, at least some of thetime, operate under the dictates of principle,and thus we have both Hearst and Chevron.

The decisions are consistent at the level of principle, but only one of them satisfies Pro-gressives. Decades of experience have dem-onstrated that courts will not, and cannot,use their power to move agency decisionsconsistently in a particular direction, or toforce agencies to act on broadly representa-tive influences. Making judicial review morethorough and searching will not, therefore,correct the systematic advantages enjoyedby powerfully organized interests.

The Progressive assault on the Constitu-

tion’s intentionally difficult system of poli-cymaking is based on the idea that a moreefficient process would remove opportuni-ties for obstruction. Believing that the forc-es of obstruction are naturally against socialequality, Progressives have long believed thata process less prone to gridlock must there-fore produce efficiency and equality. Suf-

ficient evidence has accumulated to dem-onstrate that Progressives are profoundly wrong: interests that enjoy the political advantages of superior organization becomemore influential when government can be

more efficiently moved to action, and thoseinterests are not often the ones demandinggreater social equality.

Thus, a century of Progressive success intransferring legislative power outside theMadisonian system has left the proponentsof social equality severely disappointed.Failed efforts to increase the representationof broad, unorganized interests in agency decisionmaking (citizen participation, thelegislative veto, and “hard look” judicialreview) are themselves indications of the

weakness in the Progressive case for efficientdecisionmaking. Frustrated with the choic-es made by their efficient, expert agencies,and disappointed by the failures of their re-forms, some modern Progressives finally re-sorted to patently unrealistic approaches to judicial review. One scholar suggested that judges can encourage more acceptable agen-cy policymaking by reviewing agency deci-sions on the basis of “good governance.”37 Cass Sunstein, currently administrator of the White House Office of Information and

Regulatory Affairs, wrote that judges shouldforce agencies to enhance the role of “de-liberation” in their decisionmaking.38 TheConstitution’s system of gridlock-prone in-stitutions is a more realistic approach to theproblem of managing factional interests.

The Case for Gridlock

The Constitution’s most important in-novation—the separation of legislative and

executive powers—was based on the Fram-ers’ understanding of how political interestsbehave. This understanding is sufficiently basic to term it the Constitutional Prin-ciple: The public interest is most secure when governmental institutions are inefficient decision-makers. When public policies are made withgreat specificity and efficiency, broad public



10

Gridlock-proneinstitutions

counteract amajor source of

social inequality.

interests are undermined and rent seekingis encouraged. In contrast, an arrangementthat brings diverse interests into a complex,sluggish decisionmaking process is general-ly unattractive to rent seekers. The gridlockthat Progressives abhor neutralizes some of

the political benefits that producer groupsand other well-heeled interests inherently enjoy.39

It has long been argued, at least since theFederalist Papers, that the cumbersome law-making process prescribed in the Constitu-tion prevents the adoption of ill-consideredlegislation. Erecting barriers to legislationcreates more opportunities to block poorly conceived proposals. The case for gridlockamplifies this notion by showing how basicideas drawn from interest-group theory lead

to predictions regarding the political effectof a deliberative, divided decisionmakingprocess. It is not simply that the Madiso-nian design makes it more difficult to en-act legislation. The case for gridlock showshow special interests devote fewer resourcesto rent seeking under such an arrangement,because it is less likely to be profitable andmore expensive. Thus, gridlock-prone insti-tutions counteract a major source of socialinequality.

Geoffrey Brennan and Nobel Laureate

James M. Buchanan captured the essenceof the Constitutional Principle in theirdistinction between decisions among rulesand decisions within rules.40 Consider theextremes depicted in Figure 1. When theconstitutional amendment process is un-derway, deliberations are highly visible, thedecision takes a very long time, it involves a

diverse array of participants, and everyoneknows that a successfully passed amend-ment will remain in effect for years. In con-trast, when the Environmental Protection Agency makes rules regarding the size oallowable debris fields generated by trans-

porting logs through public waterways, fewpeople know about the issue, fewer still par-ticipate, the process is relatively fast, andthe outcome is easily adjusted.

Interest groups have substantial con-cerns about decisions made in both kindsof settings. However, the pursuit of self-interest will lead a group to adopt differentpolitical objectives when the decisional set-ting is more constitutional. We do not needto discover some way to get rent seekersto abandon their self-interests in order to

minimize their impact on society and pol-icy. Institutional changes within the realmof administrative and constitutional lawcan alter the decisional context in ways thatmake it tend toward the politics of making“decisions among rules,” in which, as wewill see below, rent seeking is less likely tooccur. Derived from a large body of theo-retical work and empirical experience, theConstitutional Principle is based on thisdifference.

Why Gridlock Inhibits Rent SeekingThe assumption that people will seek

to maximize their wealth has served politi-cal and economic theory well, and we haveno reason to disturb it. However, this mo-tivation does not produce the same behav-ior in all institutional settings. Students ofinterest-group politics have often noted

Figure 1

The Constitutional Character of Government Decisionmaking

More Less

Constitutional Constitutional

Constitutional Statute Earmarks in Executive or Administrative

Amendment Making Statutes Legislative Rule Making/

Process Interventions in Adjudication

Agency Decisions



11

Broad, enduringpoliticalchoices are lessdominated by

organized groupinfluence.

that special-interest influence is less domi-nant in enduring, broad policy choices: “theinfluence of interest groups on the contentof the U.S. Constitution was less than theinfluence of such groups on the content of

ordinary, day-to-day legislation.”

41

The same contrast holds when we leavethe realm of actual constitutional choicesand consider different varieties of subcon-stitutional policy decisions. Comparing as-sorted acts of Congress, federal judge FrankEasterbrook pointed out that interest-groupinfluence was greater in highly specific stat-utes than in general statutes.42 In a quanti-tative analysis from the 1980s, two politicalscientists found that group influence inCongress is likely to be strongest when the

group’s goals are narrow and when they donot generate much visibility.43 A few yearslater, one of these scholars simply conclud-ed that “organizations can ordinarily havegreater influence on single, discrete amend-ments to bills than on entire pieces of legis-lation.”44

Why would this be the case? On first im-pression, one would assume that interest-group energies would be more ardently ap-plied to constitutional decisionmaking thanto in-period politics, since constitutional

decisions involve larger stakes. Yet, the factssuggest that broad, enduring political choic-es are less dominated by organized groupinfluence. This often-observed pattern isa function of three related political conse-quences of fashioning institutions in ac-cordance with the Constitutional Principle.When government actions are enacted in a slow-moving decisional context in which of-ficial acts are broad in scope and likely to berelatively permanent:

● political actors are less certain that thecoercive restrictions they seek will beprofitable to them;

● the lobbying costs of acquiring coer-cive redistributions are higher; and

● the participation of unorganized citi-zens becomes more significant and ef-fective.

The decisional context that perfectly em-bodies the Constitutional Principle is, of course, the process for amending the Con-stitution itself. This process is so prone togridlock that it has only been successful on

a bit more than two dozen occasions sincethe Founding (and ten of these occurred atone time). However, decisional settings thathave no formal constitutional status may bemore, or less, constitutional in the sense inwhich the term is employed here.

Uncertainty. A simple example (adaptedfrom James Buchanan) is helpful in illustrat-ing the way in which constitutional and in-period political choices differ with respectto the level of certainty particular actors canhave regarding their profitability.45 Two per-

sons, A1 and A2, both have apples to sell to10 persons, B1, B2 . . . B10 each of whom isable to pay for apples with some other good valued by the As, such as bananas. After ac-cumulating some market experience, A1 and A2 will happen upon the idea of limit-ing their trading rights, such that A1 sellsapples only to B1 through B5, and A2 sellsonly to B6 through B10. If this restriction isenacted, each of the As would thus have a lo-cal monopoly, giving both of them substan-tial rents and thus greater wealth than they

would have if buyers could contract with ei-ther seller.

However, behind the “veil of ignorance”(here meaning that one does not know whether he or she will be an A or a B whenthe market begins operating), no one wouldrationally support the establishment of the agreement that the As made. With-out knowledge of one’s future status, self-interest would oppose such a restriction.The rule—resulting in the social costs of monopoly and the wasted resources devoted

to creating and defending it—would be at-tractive to the As only if they could be cer-tain of its redistributive effect on them.

Certainty is diminished when the veil ob-scures one’s future status, but, by a similarlogic, it is also diminished when decisionsare made at a more general level with moreparticipants and creating rules of greater



12

Framing politicalchoice at a

constitutionallevel would

transform rentseekers into

zealous defendersof consumerism.

durability. As Buchanan noted, “the moregeneral rules are and the longer the periodover which they are expected to be in effect,the less certain people can be about the par-ticular ways in which alternative rules will

affect them. They will therefore be inducedto adopt a more impartial perspective and,consequently, they will be more likely toreach agreement.”46 The relationship be-tween the durability or generality of deci-sions and the degree of certainty regardingtheir impact is an important issue in consti-tutional politics.

As set out above, the fully informed deci-sion by the As to engage in a system of mar-ket restrictions was an in-period politicalchoice. They altered no rules that would ap-

ply to other actors or situations. The As knew the reach of their agreement, and they weretherefore reasonably confident that they could predict its full impact on them. How-ever, if the decisional setting were such thatthe establishment of their desired agreementwould be part of a broader enactment, or if it would be difficult to alter, the As wouldbe far less certain that the policy that gavethem the desired restriction would producea net gain, even if they could somehow seethrough the veil enough to know that they

would continue to be apple sellers. It couldeven result in a net loss for them, by facili-tating retaliation by the Bs or by restrictingtheir future choices in unwanted ways.

Consider a somewhat more complicatedworld, populated not only by As and Bs, butalso by Cs, Ds, Es, Fs, and Gs, producing andselling carrots, doughnuts, eggs, frankfurt-ers, and grapes, respectively. If the As couldpursue an agreement only applying to re-strictions on apple selling, they would sup-port it, as it would help them monopolize

and enjoy monopoly rents. If, however, sucha restriction could only be enacted as partof a general law authorizing officially sanc-tioned and governmentally enforced traderestraints, the As would realize that their ex-pected gains from monopoly sales of appleswould be more than offset by the disadvan-tages of having to buy from six other mo-

nopolists. Framing the political choice at aconstitutional level would transform the Aswho were rent seekers when the decisionalcontext made narrowly targeted restrictionspossible, into zealous defenders of consum-

erism, although they would still be motivat-ed only by self-interest. A less abstract example may be usefu

here. Imagine the position of used car deal-ers’ associations on a proposal submittedto a “Used Car Dealers Board” regardingthe enactment of more stringent licensingrequirements for sellers of used cars. Sincethe proposed standards would by assump-tion be requirements already met by themembers of the group (or requirementsthey could satisfy with little cost), the asso-

ciation would support the proposal, antici-pating increased profits as a consequenceof restrictions on their present and futurecompetitors. The dealers’ group would devote considerable energy and, if necessarysignificant shares of their productive re-sources to promoting the proposal becauseit would help protect them from competi-tors, and because, as enacted by this insti-tution, the coercive power of governmentwould be precisely targeted and fully subjectto their influence as future needs change.

Now, consider this same organization’sapproach to a proposal that would enact thesame restrictions, but in this case its propos-al is merely one part of a much more generallegislative package. Framed more constitu-tionally, the proposed policy choice wouldbe an action by a broader official body (thelegislature, or perhaps a regulatory commis-sion with a comprehensive jurisdiction) thatwould produce an omnibus empowermentto establish cartelizing restrictions. Whilethe organization could be relatively certain

about the effect of a specific rule on its in-terests, it is profoundly uncertain regardingthe net profitability of having achieved thesame set of restrictions as but one part of aconstitutional decision.

The dealers would recognize that whilethey would profit from governmental re-striction of future competitors in the used



13

Congressionallobbying effortsare usually more

uncertain thanthe outcomeof an effort toinfluence anadministrativeagency.

car market, they could be injured by cartel-ization of their suppliers and by carteliza-tion of the dozens of industries producinggoods and services that they consume.47

Moreover, they might consider whether a

cartelizing restriction that would be help-ful now would be damaging later (perhapsit would obstruct expansion plans or the useof profitable emerging technologies), and, if the restriction were enacted by a unit withbroader jurisdiction governmental unit, itwould be much more difficult to adjust.48

The changed decisional context produces a different political demand out of the samerational self-interest. As one observer not-ed, “groups that enjoy the protection of ananti-competitive regulatory environment

for their own industries are harmed by thehigher air fares that result from the regu-lation of airlines. . . . Even special-interestgroups that might benefit from some spe-cific, discrete legislative wealth transfersare likely to object to general constitutionalprovisions that facilitate rent seeking.”49 Thus, particular economic interests wouldnot consider a general cartelization action as valuable to them as the highly focused deci-sions made and implemented by functional-ly specific boards, and, ceteris paribus, they

would expend fewer resources in support of the enactment of such a broad policy choice.

The breadth and durability of the de-cisional context alters the interest group’spolitical posture because of the divergencebetween its immediate, particular interestsand its preferences regarding more general,enduring policy choices. The in-period andconstitutional interests of the group are inconflict, and it is this conflict that makesthe Constitutional Principle a potential so-lution to the problems of rent seeking and

other maladies of interest-group politics. Amore constitutional institutional context,one that frames government choices in moregeneral terms, leaves special interests withless certainty regarding the net profitability of the coercive measure that would (amongother effects) facilitate the taking of the par-ticular rents each such interest seeks. Broad-

er decisional contexts “thicken” the “veil of ignorance,” so to speak, making the politi-cal actor more doubtful about the overallprofitability of turning to government asan approach to wealth maximization.50 As

one observer concluded, interests “behindthe veil do not know if they will be on thepaying or the receiving end of transfers andthus have an incentive to choose constitu-tional rules restricting government’s powerto transfer wealth.”51

Moreover, beyond the uncertainty creat-ed by the breadth and relative permanenceof policy choices in more constitutionaldecisional settings, congressional lobbyingefforts are usually more uncertain than theoutcome of an effort to influence an ad-

ministrative agency because of the impactof national partisan politics on the former.Partisan shifts in Congress, or shifts in pres-idential-congressional relations, can createuncertainty regarding the actions that may be taken regarding virtually all policies, in-cluding those most important to rent seek-ers. When this political uncertainty is great-est, organized interests have an additionalreason to prefer more insular, administra-tive forums. Hence, the Progressive innova-tion of independent administrative power

provides a solution to two kinds of uncer-tainty that would otherwise dampen theardor of rent-seeking interests: such powertakes policymaking away from the political vicissitudes of partisan conflict in the elec-toral branches, and it facilitates the enact-ment of decisions that, by virtue of theirspecificity and ease of adjustment, are morecertain to be profitable.

It is thus too simple to think of rent seek-ing and excessive special-interest influenceas problems caused by agencies becoming

“captured,” or by the establishment of “irontriangles” or rigid issue networks.52 Rent-seeking interest groups want regular accessto government officials, but they also want a larger degree of certainty that their politicalinfluence will bear fruit. This is why the in-stitutional arrangement favored by Progres-sives encourages special interests to invest



14

The rentseeker’s political

advantages aredecisive when a

policy is made inselective settings

with narrow impacts.

substantial resources in political efforts toobtain economic advantages through gov-ernment action. An institutional settingdesigned in accordance with the Constitu-tional Principle would produce governmen-

tal policy choices less certain to be profit-able to specific economic interests, andwould therefore not entice them to expendas many of their resources on rent seeking.

Lobbying Costs. An institutional settingin which decisions are made at a more con-stitutional level also raises lobbying costs.Such costs rise with the constitutional char-acter of the institutional context for tworeasons. First, decisions made at a broaderlevel of generality involve a wider range of decisionmakers, requiring that more offi-

cials and government units be influenced.In such decisions, it is thus more likely thatdivergent and incompatible interests andinstitutions will have to be accommodated,making the lobbying effort more difficultand expensive. Second, constitutional de-cisions are often characterized by the exis-tence of multiple clearances and substantiveconstraints that must be overcome or cir-cumvented, increasing lobbying costs stillfurther.

As a leading scholar of institutions and

economics explained, under the convention-al regulatory arrangement established by Progressive thinking, economic minoritiesseeking regulatory policies harmful to majority interests need only influence a smallcommission and not the complex systemof dispersed lawmaking power that distin-guishes the constitutionally derived sys-tem.53 If decisions on these matters had tobe made in a broader institutional setting,the “political cost of redistribution” wouldbe significantly higher, thus reducing redis-

tribution’s profitability.54 When institution-al arrangements are less constitutional, rentseekers thus receive a doubled enticement:the enactments they seek become more cer-tainly profitable and cheaper to obtain.

Public Involvement. Rent seekers are alsoencouraged by less constitutional decision-making venues because there is normally

less involvement by the general public inthem. Rent seekers lose their command-ing access when decisions become morebasic and general in scope because citizensare much more likely to become involved

in such decisions. This involvement, to theextent it actually occurs, should make rent-seeking initiatives less attractive.55

Consider the interests of a member of thegeneral public in, say, regulations restrict-ing the production of oranges. Despite thefact that consumption of oranges is wide-spread, and that Agriculture Departmentregulations on orange growing cost the aver-age consumer some $15–25 annually whilebenefitting only a few persons and corpo-rations, the typical consumer will not find

it rational to spend much time or effort tooppose the regulations. He or she will prob-ably not make a voting decision on the ba-sis of such a small issue, even if completelyaware of it. However, it would take littleimagination to envision the generalized po-litical energies that would be unleashed asa result of a proposal to adopt, as a consti-tutional policy choice, the extensive arrayof restrictive agricultural and professionallicensing regulations that are currently in ef-fect. Consumer watchdogs would calculate

the total consumer cost of such a sweepingenactment, generating substantial opposi-tion. Such a decision would be also be muchmore visible in terms of media coverage. Therent seeker’s political advantages are deci-sive when a policy is made in more selectivesettings with narrower impacts, and thus,such actors are more likely to devote scarceresources to political action in them than inbroader institutional contexts.

The late Jack Walker, one of the leadingpolitical scientists of the last century, came

to the following conclusion following hisextensive empirical study of interest-groupbehavior and influence in Washington:

Once the president and congressio-nal leaders become directly involvedin debate over an issue, the contro- versy naturally attracts the attention



15

An institutionalsetting prone togridlock createsa constitutionaldecisionalcontext thatdampens thenegative effectsof self-interested

political action.

of larger numbers of people. The massmedia begin to transmit informationabout the policy questions and person-alities involved, and members of thepublic are tempted to make their pref-

erences known to their elected repre-sentatives. In Schattschneider’s terms,possibilities increase for a widening of the scope of conflict to include groupsand citizens outside subgovernmentsand outside Washington itself.56

This widened conflict reduces the politicaladvantages enjoyed by rent seekers, thusdiscouraging them from devoting their re-sources to lobbying.

The Constitutional Principle simply

holds that the institutional setting in whichimportant policy decisions are made shouldbe sufficiently broad to create a noteworthy increase in lobbying costs and uncertainty encountered by rent seekers and “distribu-tional coalitions.” Because their costs arelower where the decisionmaking setting isless visible and when it involves a less diverserange of participants, an institutional shifttoward the Constitutional Principle shouldthus reduce rent-seeking behavior.57 It isnot surprising that rent seekers have rarely

felt threatened by the prospect of publicparticipation in hearings in which the de-cisions they demand are considered. Butthey did adamantly oppose Congressionalforays into regulatory policy, not only be-cause they objected to the particular policy choices made, but because the commissionsand agencies they had worked with wouldhave less independent authority over futurepolicy changes.58

Taken together, these three consequencesof increasing the constitutional character of

decisional settings suggest that institutionalfactors affect the amount of special-interestinfluence over public policy—rent seeking isnot simply a function of the extent to whichinterest groups have achieved effective or-ganization. A Progressive institutional set-ting encourages rent seeking by (a) facilitat-ing the enactment of highly specific, easily

adjusted coercive government actions, whichmakes special interests more certain aboutthe net profitability of the particular poli-cies they seek; (b) decreasing the costs of lob-bying for such actions; and (c) minimizing

the participation of unorganized interests. An institutional setting more prone to grid-lock creates a more constitutional decisionalcontext that dampens the negative effects of self-interested political action.

Conclusion

We can thus begin to understand why a contemporary Progressive like Paul Krug-man found himself parroting Theodore

Roosevelt’s 1912 assessment of political andeconomic inequality in the United States.The epoch-defining expansion of the role of government that occurred during the cen-tury between their statements may or may not have had positive impacts, but it surely encouraged the formation of rent-seekinginterests and amplified their power. Somepublic programs have been great successes,but the Progressive’s insistence on an insti-tutional arrangement that facilitates rentseeking has kept the Progressive goal of

greater social equality from being realized.In 1982, Olson reflected on a lifetime of re-search on economic policy:

A very large part of the activities of governments, even in the developeddemocracies, is of no special help tothe poor and many of these activitiesactually harm them. In the UnitedStates there are subsidies to the own-ers of private airplanes and yachts,most of whom are not poor. The

intervention of the professions andthe government in the medical caresystem . . . mainly helps physiciansand other providers, most of whomare well heeled. . . . The reason thatgovernment and other institutionsthat intervene in markets are not ingeneral any less inegalitarian than



16

Social equality has not

emerged fromthe efficiently

responsive kindof government

that Progressivesfavor.

competitive markets is that . . . there is greater inequality . . . in the opportunity tocreate distributional coalitions than thereis in the inherent productive abilities of people.59

The institutional arrangements Progres-sives have sought would only work if all in-terests had influence proportionate to theirrespective memberships, or if citizens weresomehow freed from their self interests. Itis time to reach a general conclusion aboutProgressivism’s approach to institutions:social equality has not, and cannot, emergefrom the efficiently responsive kind of gov-ernment that Progressives favor and thatthe Founders rejected.

Gridlock, so often derided by politicians,the press, scholars, and citizens, is naturally frustrating. But an institutional arrange-ment that is not frustrating and protractedwill be dominated by interests with superiororganizations and political skills. The ques-tion Progressives should be asking is “underwhat kind of institutional arrangement is thepublic interest less likely to be undermined?”The failure of Progressive institutions to advance the Progressive goal of social equality is, in large part, a consequence of Progressiv-

ism’s success in circumventing gridlock.

Notes1. These figures are from a note sent by Davis,Polk, and Wardwell to its clients, as reported in“The Uncertainty Principle,” Wall Street Journal ,

July 14, 2010.

2. Paul Krugman, “The Great Wealth Transfer,” Rolling Stone, December 22, 2006, http://www.informationclearinghouse.info/article15923.htm.

3. Will Wilkinson, “Thinking Clearly about Ec-onomic Inequality,” Cato Institute Policy Analy-sis no. 640, June 14, 2009, http://www.cato.org/pubs/pas/pa640.pdf. Wilkinson thoroughly ex-plains why the relevant economic facts do notsupport Krugman’s conclusion that contempo-rary America has entered a new “gilded age” withthe least prosperous suffering brutal poverty.

4. Theodore Roosevelt made these remarksduring the 1912 presidential election.

5. Block v. Community Nutrition Institute, 467 US. 340 (1984): 348–52.

6. “Rent seeking” is the effort to expand wealthby devoting resources to establish governmentalor other restrictions that make it possible to reapprofits higher than would be obtained in a more

competitive environment. Thus, all economicactors face a choice between investing in pro-duction (e.g., more efficient manufacturing ordistribution techniques) and investing in effortsto obtain government regulations that reducecompetition. Rent seeking leads to a significantloss of national wealth, although the magnitudeof this loss is a matter of some debate. Howeverwhen the nature and size of government makesit easier to obtain the restrictions rent seekerswant, firms and producer interest groups areencouraged to devote more of their resources torent seeking. The foundational works are Gor-don Tullock, “The Welfare Costs of Tariffs, Mo-nopolies, and Theft,” Western Economic Journal 5(1967): 224–32; and Anne Krueger, “The Politi-cal Economy of the Rent-Seeking Society,” American Economic Review 64 (1967): 291–303.

7. James Allen Smith, The Spirit of American Government (New York: Macmillan, 1907), pp. 207293. See also Charles Beard, An Economic Inter

pretation of the Constitution of the United States (New York: Macmillan, 1913).

8. David Truman, The Governmental Process (New York: Knopf, 1951).

9. James M. Burns, The Deadlock of Democracy

(Englewood Cliffs, NJ: Prentice-Hall, 1967), p. 710. Robert A. Dahl, A Preface to Democratic Theo-ry (Chicago: University of Chicago Press, 1956),p. 81.

11. James Landis, The Administrative Process (NewHaven, CT: Yale University Press, 1938), pp. 146, 122.

12. EPA Administrator Lisa Jackson was quotedin the Washington Post (December 8, 2009) as say-ing that EPA regulation is not the “preferred out-come,” and that her agency and other adminis-tration officials would still prefer that Congress

acted before they did. Amazingly, congressionalreluctance to pass a bill carries little weight interms of administrative policy choices.

13. Mancur Olson Jr., The Logic of Collective Action(Cambridge: Harvard University Press, 1965).

14. See, for example, James Q. Wilson, PoliticaOrganizations (New York: Basic Books, 1973)and John M. Hansen, “The Political Economyof Group Membership,” American Political Science



17

Review 79 (1985): 79–96.

15. Olson, The Rise and Decline of Nations (New Haven, CT: Yale University Press, 1982), pp. 34–35n, emphasis added).

16. Those analysts who argue that the simple

existence of political organizations disproves Ol-son’s theory attack what has come to be knownas the “strong” free-rider hypothesis—the idea that no collective action can be produced with-out coercion or substantial selective incentives.The “weak” free-rider hypothesis predicts thatwhile many kinds of groups may form, thoseforming without coercion or selective incentiveswill be very small (relative to the size of theirpotential memberships) while those organiza-tions fortunate enough to have access to somemethod of coercion will succeed in getting mostor nearly all of those for whom they act to jointhe collective effort. See Gerald Marwell andRuth E. Ames, “Experiments on the Provision of

Public Goods I: Resources, Interest, Group Size,and the Free-Rider Problem,” American Journal of Sociology 84 (1979): 1335–60. In other words,the “weak” free-rider hypothesis suggests thatthe impact of free riding is revealed by compar-ing the ratio of actual contributors to potentialcontributors in different collective efforts. Tocontinue with Olson’s example, this ratio wouldbe < .01 for environmental organizations, but itwould be much higher, nearly 1.0, for U.S. steelworkers. The “weak” free-rider hypothesis sim-ply explains this enormous discrepancy amonggroups with respect to their collective politicalenergies, and thus, it leads to the conclusion that

the political influence exerted by the array of ac-tive political organizations will not even roughly approximate the array of interests in society. Theempirical evidence universally confirms this hy-pothesis.

17. See Walter A. Rosenbaum, “The Paradoxes of Public Participation,” Administration and Society 8(1976): 355–83; and D. Stephen Cupps, “Emerg-ing Problems of Citizen Participation,” Public Ad-ministration Review 37 (1976): 478–87.

18. Amy McKay and Susan Webb Yackee, “In-terest Group Competition on Federal Agency Rules,” American Politics Research 35 (2007): 349–

50.

19. David Fontana, “Reforming the Adminis-trative Procedure Act: Democracy Index Rule-making,” Fordham Law Review 74 (2005): 125.

20. Coglianese, Cary, Heather Kilmartin, andEvan Mendelson, “Transparency and Public Par-ticipation in the Rulemaking Process,” Reportof a Nonpartisan Presidential Task Force, Uni-

versity of Pennsylvania, 2008, www.hks.harvard.

edu/hepg/Papers/transparencyReport.pdf.

21. See Steven J. Balla and Benjamin M. Daniels,“Information Technology and Public Agency Regulation,” Regulation and Governance 1 (2007):46–67; and Beth Simone Noveck, “The Electron-ic Revolution in Rule-Making,” Emory Law Jour-

nal 53 (2004): 433–522.

22. Cary Coglianese, “Citizen Participation inRulemaking: Past, Present, and Future,” Duke

Law Journal 55 (2006): 964–65.

23. INS v. Chadha, 462 U.S. 919, 1983. How-ever, according to one observer’s count, Con-gress added 200 new legislative veto provisionsbetween Chadha and the end of 1990. See LouisFisher, Constitutional Conflicts between Congress andthe President , 3rd ed. (Lawrence, KS: University Press of Kansas, 1991), p. 150.

24. One of the strongest advocates for the legis-

lative veto was former Congressman Elliott Levi-tas (D-GA). The idea that the legislative veto wassimply a way to restrain over-zealous agencieswas the theme of a cover story in Industry Weekprominently featuring Levitas. See John H. Sher-idan, “Can Congress Control the Regulators?”

Industry Week 181 (March 29, 1976): 20–27.

25. Office of Communication of United Church of Christ v. FCC , 359 F. 2d 994 (1966), and Citizensto Preserve Overton Park, Inc., v. Volpe, 335 F. Supp.873 (1971).

26. Louis Fisher, “Judicial Misjudgments about

the Lawmaking Process: The Legislative VetoCase,” Public Administration Review 45 (1985): 705–11.

27. See Landis, The Administrative Process, p. 77:“In English administrative law two techniqueshave been developed which might be adapted toour needs. Both require proposed regulations tobe laid before Parliament. The first requires that a regulation becomes effective within a given peri-od of time, unless prior thereto Parliament shall,by resolution, have disapproved it. The secondprovides that a regulation shall not become effec-tive until Parliament by resolution approves it.”

28. For a discussion of several important courtdecisions and cases surrounding these issues, seeCass R. Sunstein, “Deregulation and the HardLook Doctrine,” Supreme Court Review (1983):177–213; and Richard J. Pierce, Jr., Sidney A.Shapiro, and Paul R. Verkuil, Administrative Lawand Process, 4th ed. (New York: Foundation Press,2004), ch. 7.

29. See Marcus Ethridge, “Minority Power andMadisonianism,” American Journal of Political Sci-



18

ence 35 (1991): 335–56, for a formal analysis anda few examples.

30. Mathew McCubbins and Thomas Schwartz,“Congressional Oversight Overlooked: Police Pa-trols versus Fire Alarms,” American Journal of Politi-cal Science 28 (1984): 165–79.

31. This author observed an instructive instanceof the legislative veto at the state level in Tennes-see during the 1970s. In an unusual pro-consum-er move, the state’s Alcoholic Beverage Commis-sion voted to rescind its decades-long restrictionon advertising the retail price of liquor. Beforethe rescission could go into effect, the retailers’association succeeded in getting a friendly legis-lative committee to use a legislative veto to over-turn the agency. Similar patterns have been ob-served at the federal level. See Barbara H. Craig,The Legislative Veto (Boulder: Westview Press,1983; Harold Bruff and Ernest Gellhorn, “Con-gressional Control of Administrative Regulation:

A Case Study of Legislative Vetoes,” Harvard Law Review 90 (1977): 1369–1440; John R. Bolton, The Legislative Veto: Un-Separating the Powers (Washing-ton: American Enterprise Institute, 1977); andRobert S. Gilmour, “The Congressional Veto:Shifting the Balance of Administrative Control,”

Journal of Policy Analysis and Management 2 (1982):13–25.

32. Jonathan R. Macey, “Separated Powers andPositive Political Theory—The Tug of War Over

Administrative Agencies,” Georgetown Law Journal 80 (1992): 694–97.

33. 322 U.S. 111 (1944), and 467 U.S. 837 (1984).34. Hearst , p. 131.

35. Chevron, pp. 842–43.

36. See, for example, Citizens to Preserve Overton Park, Inc., v. Volpe, 335 F. Supp. 873 (1971); Motor Vehicle Manufacturers Association of the United States,

Inc. v. State Farm Mutual Insurance Company, et al. ,463 U.S. 29 (1983); Rust v. Sullivan, 500 U.S. 173(1991); and Vermont Yankee Nuclear Power Corp.v. Natural Resources Defense Council , 435 U.S. 519(1978).

37. Christopher Edley, Administrative Law (New Haven, CT: Yale University Press, 1990).

38. Cass Sunstein, “Factions, Self-Interest, andthe APA: Four Lessons since 1946,” Virginia Law

Review 62 (1986): 271–96.

39. For an interesting formal analysis of thetendency for gridlock created by the institu-tional arrangement set forth in the Constitu-tion, see Keith Krehbiel, Pivotal Politics: A Theory of

U.S. Lawmaking (Chicago: University of ChicagoPress, 1998).

40. This definition is adapted from GeoffreyBrennan and James M. Buchanan, The Reasonof Rules (Cambridge, UK: Cambridge UniversityPress, 1985).

41. Jonathan R. Macey, “Promoting Public-Regarding Legislation through Statutory Inter-pretation: An Interest Group Model,” Columbia

Law Review 86 (1986): 249–50.

42. Frank H. Easterbrook. “Foreword: TheCourt and the Economic System,” Harvard Law

Review 98 (1984): 4–60.

43. Kay Lehman Schlozman and John T. Tierney, Organized Interests and American Democracy(New York: Harper and Row, 1986), p. 317.

44. John T. Tierney, “Organized Interests and

the Nation’s Capitol,” in The Politics of Interestsed. Mark P. Petracca (Boulder: Westview Press1992), p. 217.

45. James M. Buchanan, The Economics and the Ethics of Constitutional Order (Ann Arbor: Univer-sity of Michigan Press, 1991), pp. 127–28.

46. Ibid., p. 56. Also see Buchanan, “The Consti-tution of Economic Policy,” American Economi

Review 77 (1987): 243–50.

47. Of course, when the government enactssuch policies, driven perhaps by ideological orpartisanship reasons (as in the case of the Na-tional Industrial Recovery Act in the 1930s)such interests would be expected to demandtheir cartelizing restrictions anyway: other in-dustries would cartelize whatever the choice ofan individual economic interest.

48. Administrative rulemaking can be very slowsometimes much slower than congressional pol-icymaking, but administrative agencies can usu-ally be much more efficient in making specificpolicy changes than the Madisonian lawmakingsystem can be.

49. Jonathan R. Macey, “Promoting Public-

Regarding Legislation through Statutory Inter-pretation: An Interest Group Model,” Columbia Law Review 86 (1986): 246–67.

50. An important theoretical work on the sociacosts of monopoly amplifies the point. Hillmanand Katz (1984) demonstrated that rent seek-ers will spend resources in rent seeking up tothe amount of the value of the rent sought onlywhen they are risk-neutral. See Arye L. Hillmanand Eliakim Katz, “Risk-Averse Rent-Seekers and



19

the Social Cost of Monopoly Power,” Economic Journal 94 (1984): 104–10. If they are risk averse,rent seekers spend less on acquiring rents than issuggested by the most pessimistic predictions inthe literature. See Keith Cowling and Dennis C.Mueller, “The Social Costs of Monopoly Power,”

Economic Journal 88 (1978): 727–48, for a particu-

larly stark estimate. While the degree of a givenpolitical actor’s risk averseness is a function of his or her preferences and interests, a consti-tutional arrangement makes it more difficultfor political actors to estimate the probability of success. Expending scarce resources on rentseeking becomes a riskier investment strategy asinstitutional design decreases certainty regard-ing the net profitability of rent-seeking efforts.Investment in productive activity becomes cor-respondingly more valuable.

51. Daniel Sutter, “Durable Constitutional Rulesand Rent-Seeking,” Public Finance Review 31 (2003):425.

52. Two classic works on “capture” are Mar- ver Bernstein, Regulating Business by Independent Commission (Princeton, NJ: Princeton University Press, 1955), and J. Leiper Freeman, The Politi-cal Process, rev. ed. (New York: Random House,1965). The term “issue networks” was coined by Hugh Heclo to indicate the more fluid, open,but still patterned relationships between inter-est groups and governmental institutions (seeHeclo, “Issue Networks and the Executive Estab-lishment,” in The New American Political System,ed. Anthony King (Washington: American En-terprise Institute, 1978): 87–124.

53. Lance E. Davis and Douglass C. North, In- stitutional Change and American Economic Growth (New York: Cambridge University Press, 1971),p. 260.

54. Ibid., p. 30.

55. Robert E. McCormick and Robert D. Tolli-son, Politicians, Legislation, and the Economy (Bos-ton: Martinus Nijhoff, 1981), p. 127.

56. Jack L. Walker Jr., Mobilizing Interest Groups in

America (Ann Arbor, MI: University of MichiganPress, 1991), pp. 127–28.

57. In an interesting study of the differencesamong electoral systems, two economists con-cluded that rent seeking is most prevalent whenthe institutional arrangement makes it difficultfor voters to determine which elected leaders areto blame for wasteful actions. See Torsten Pers-son and Guido Tabellini, “Constitutions andEconomic Policy,” Journal of Economic Perspectives18 (2004): 75–98.

58. One legal analyst makes the point this way:“by simultaneously dividing power among the

three branches and institutionalizing methodsthat allow each branch to check the others, theConstitution reduces the likelihood that one fac-tion or interest group that has managed to ob-tain control of one branch will be able to imple-ment its agenda in contravention of the wisdomof the public.” See Martin H. Redish, The Con-

stitution as Political Structure (New York: OxfordUniversity Press, 1995), p. 4. Thus, the Constitu-tional Principle achieves broadened involvementnot by energizing masses of citizens into a socialmovement, but by denying any one part of theinstitutional system exclusive control over deci-sionmaking. This produces a genuinely broader

involvement than requirements for public hear-ings when a unicameral agency makes rules.

59. Olson, The Rise and Decline of Nations, pp.174–75, emphasis added.



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