That One Time I Agreed with Ian Millhiser (on Constitutional Law, No Less!)

by Chris Walker — Tuesday, Mar. 6, 2018@chris_j_walker

constitutional coupI have long admired Jon Michaels’ work on separation of powers and government privatization, so I was thrilled to learn he had further synthesized these strands of his research in a book-length treatment: Constitutional Coup: Privatization’s Threat to the American Republic. And I’m excited we’re hosting this symposium on the book here at the Notice and Comment blog.

As others have already weighed in on the privatization angle (here and here), I’ll focus on Michaels’ contribution to our understanding of separation of powers within the administrative state.

Count me among those who worry about the modern administrative state’s place within our separation-of-powers framework. I mean that not just in the formal sense of nondelegation of Article I legislative power and nonintrusion on Article III judicial power. I also worry about separation of powers in the related Blackstone-Locke-Montesquieu sense concerning the dangers of consolidating law-making and law-executing powers in the same government actor.

Michaels advances a new theory of separation of powers—one that differs from the traditional model—that attempts to modernize separation of powers for an era where lawmaking by regulation predominates. Jeff Pojanowski has a nice summary of Michaels’ theory of internal separation of powers in his forthcoming Michigan Law Review review of the book (footnotes omitted):

Michaels offers a reconstruction in which separation-of-powers principles deep within our constitutional DNA re-express themselves in the apparatus of the administrative state. Agency leaders, who answer to the President are, literally, “the administrative standard-bearers” for the head of the Executive Branch. Standing in for the Judicial Branch, in an admittedly more metaphorical fashion, are civil servants who enjoy tenured employment and are insulated from politics as they go about their reasoned, steady application of expertise to their legal mandate.” Finally, civil society, empowered through the APA’s notice-and-comment rulemaking proceedings, plays the role of Congress, as its input helps shape the rules forged in the interaction between presidential appointees and civil servants.

Michaels’ approach, especially as to the latter Blackstone-Locke-Montesquieu separation-of-powers concerns, has a lot to offer.

After all, it identifies additional internal protections against the dangers of one government actor—the federal agency—exercising both law-making and law-executing powers. To be sure, the agency still has both powers, so the separation-of-powers concerns aren’t eliminated. But to exercise those powers there exist internal checks between the political appointees and the career civil servants at the agency, with the public also being able to provide input (at least in the rulemaking context)—input that must be considered by the agency, subject to judicial review. These internal checks may also elevate issues to Congress (and the President), which can also intervene to address the danger of consolidated governmental powers.

I’m convinced that this internal separation of powers has significant statutory force. It is built into the DNA of the Administrative Procedure Act (APA) and related statutes, and courts have fleshed out these internal separation-of-powers considerations through administrative common law. The doctrine that agencies must respond to significant comments made during the comment period comes immediately to mind. Hard look review is perhaps another example, as are the series of Supreme Court opinions (Fox v. FCC, Encino Motocars, etc.) that seem to underscore that an agency’s change in position must be justified by something more than just a mere change in presidential administration.

In other words, Congress has set forth a statutory framework for the modern administrative state (the APA), and federal courts have interpreted that framework in ways that advance this internal separation of powers and thus attempt to account for the federal bureaucracy’s democratic deficits. Or, as Ian Millhiser put it in his review of the book over at the Take Care blog, “As a policy matter, this framework strikes me as insightful and correct.”

But Michaels does not just argue that this internal separation of powers is our statutory law and good policy. Nor does he just argue that this separated powers framework is constitutionally permissible. The main thrust of his argument is that the framework is constitutionally obligated. On that argument, I find myself agreeing with Millhiser’s bottom line (though not with everything in his review!):

Unlike the separation of powers among the three constitutional branches, there is no textual hook in the Constitution for Michaels’ administrative separation of powers. Nor is the history Michaels recounts in his book consistent with an originalist case supporting his framework. Michaels is correct that the early American government’s reliance on privateers, tax weasels, Pinkertons and other private contractors speaks more to the very different conditions that existed in the early United States than it does to a requirement that government use private contractors today. But, at the very least, this early history suggests that the Constitution was not originally understood to offer civil service protections to government workers.

. . .

Given that the Constitution demands such a precise allocation in this one context, it strikes me as very odd to claim that the Constitution also mandates an implicit balance of powers within agencies, that this balance is defined nowhere in the text of the Constitution, and that this administrative separation of powers flows from the fact that agency heads, civil servants, and the public all bear some resemblance to the president, judges, and Congress, respectively.

If the Constitution did provide for an administrative separation of powers, one would expect the precise allocation of those powers to be defined very particularly—just as they are defined very particularly with respect to the executive, the legislature, and the judiciary.

Michaels responds:

One reason why I think it makes sense to continue talking about the constitutional underpinnings of the administrative state is because the constitutionality of the administrative state remains, at least in some circles, a debatable proposition. And I’m not sure we have put the administrative state’s best foot forward, relying as we have for generations on what some—including some progressive justices—may characterize as a legal fiction (namely, that agencies aren’t actually lawmaking). For that reason, if no other, I see the need not only to continue discussing the constitutionality of the administrative state but to furnish what I think is a more compelling justification—one that has the added feature of having something specific to say about the privatization revolution of the past several decades.

Michaels’ response to Millhiser is worth unpacking.

It is certainly true that the constitutionality of certain aspects of the administrative state are debatable. Just this Term, the Supreme Court will determine (in Oil States) whether an agency can extinguish patent rights via adjudication (without an Article III court and jury trial) and (in Lucia) whether administrative law judges (ALJs) at the SEC are unconstitutionally appointed. The latter case, as Jenn Mascott explains, could lead the Court to consider whether the statutory removal protections for SEC ALJs are unconstitutional. This issue has potentially sweeping implications for the career civil servants that Michaels perceives as the judges in the internal separation-of-powers framework. Finally, earlier this week the Court granted cert (in Gundy) on whether Congress’s delegation of certain rulemaking authority to the Attorney General under the Sex Offender Notification and Registration Act violates the nondelegation doctrine.

Similarly, there is much to be said for Michaels’ assertion that some regulatory progressives have grounded the constitutionality of the modern administrative state on the (precarious) legal fiction that agencies aren’t exercising Article I legislative power when regulating (or, for that matter, Article III judicial power when adjudicating private rights). A defense of the constitutionally problematic aspects of the administrative state is in search of a more compelling justification. Bonus points if, as Michaels’ theory does, this justification addresses the problem of “pretend privatization.”

For me, though, that constitutional theory has to have a firm grounding in the text and structure of the actual constitution, not just in the quasi-constitution of the administrative state (the APA). Michaels’ theory finds strong support in the latter, but (at least for me) finds little support as a matter of constitutional obligation in the former.

So what is the compelling justification for the modern administrative state? If I had the answer, I’d be writing a book! As I have argued elsewhere, however, part of the answer has to include Congress reasserting its proper role in legislating regularly and better constraining its bureaucratic agents. Josh Chafetz’s new book Congress’s Constitution provides the toolbox for such congressional efforts.

These criticisms should not detract from the important contribution Constitutional Coup makes with respect to debates on separation of powers and the future of the administrative state. I fully concur in the final lines of Pojanowski’s review: “Constitutional Coup offers a fresh take on the important public question of privatization and does so in a way that departs from the usual grooves of argument between originalist critics and functionalist defenders of the administrative state. Not bad for 297 pages of clear, lively prose. I recommend reading them.”

 


This post is part of a symposium reviewing Constitutional Coup: Privatization’s Threat to the American Republic, a new book by Jon D. Michaels, Professor of Law at UCLA School of Law. All of the posts can be read here.

Cite As: Author Name, Title, 36 Yale J. on Reg.: Notice & Comment (date), URL.

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About Chris Walker

Christopher Walker is a law professor at The Ohio State University Moritz College of Law. Prior to joining the law faculty, Professor Walker clerked for Justice Anthony Kennedy of the U.S. Supreme Court and worked on the Civil Appellate Staff at the U.S. Department of Justice. His publications have appeared in the California Law Review, Michigan Law Review, Stanford Law Review, and University of Pennsylvania Law Review, among others. Outside the law school, he serves as one of forty Public Members of the Administrative Conference of the United States and on the Governing Council for the American Bar Association’s Section on Administrative Law and Regulatory Practice. He blogs regularly at the Yale Journal on Regulation.

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