Archive for the ‘Administrative Law’ Category

The (Still Yet) Unfulfilled Promise of Automated Government Decision-Making

posted by Danielle Citron

In Technological Due Process, 85 Wash. U. L. Rev. 1249 (2008), I explored the promise and perils of the increasing automation of administrative decision-making.  The automated administrative state took root after the convergence of a number of trends — the budget shortfalls of the 1990s, the falling costs and increased performance of information systems, and the emergence of the Internet.  Government officials saw computerized automation as an efficient way to reduce operating costs: Automated systems meant less paperwork and fewer staff.  Today, all states now automate a significant portion of the administration of their public benefit programs.  More than fifty federal agencies execute policy with data-matching and data-mining programs.  As a result, agencies increasingly use information systems to make decisions about important individual rights.

Technological Due Process identified three central problems with administrative automated systems.  First, when programmers translate policy into code, they inevitably distort it, thus embedding incorrect policy into systems.  Second, data matching programs misidentify individuals because they use crude algorithms that cannot distinguish between similar names.  Last, automated systems often have problems providing notice to individuals, often because they lack audit trails that capture why government agencies take particular action.

Colorado’s automated public benefits system, known as CBMS, served as an important case study for my work.  Responses to open-sunshine requests revealed that from September 2004 to April 2007, programmers embedded over 900 incorrect rules regarding Medicaid, food stamps, and other public benefits into CBMS.  As a result, CBMS terminated Medicaid benefits of patients with breast cancer based on income and asset limits unauthorized by federal or state law.  It denied food stamps to individuals with prior drug convictions in violation of Colorado law.  And it demanded that eligibility workers ask applicants if they were “beggars,” even though neither federal law nor state law required an answer to that question for the provision of public benefits.  Moreover, because CBMS lacked audit trails, individuals often received wholly deficient notice when the system cut or terminated their benefits.  At times, individuals received no notice.

The past four years has seen little progress.  Although state officials in 2009 thought that entering into a $48.6 million, four-year contract with Deloitte Consulting would help fix these problems, matters have arguably gotten worse.  CBMS, for instance, has delayed processing applications for benefits in 70% of cases (in violation of federal law).  It continues to terminate individuals’ public benefits without notice.  (One case led to the death of a nine-year old boy after a pharmacy would not fill his asthma prescription despite proof that his family qualified for Medicaid help).  Business school professor Don McCubbrey, who I interviewed for Tech Due Process, recently explained to the Denver Post that the recent failures cannot be due to the thousands of new Medicaid and other benefit applications from the recession.  In his view, a “system that large should be able to scale.”  According to Ed Kahn of the Colorado Center on Law and Policy, the system hasn’t just failed to fulfill its federal and state requirements but has “regressed.” Read the rest of this post »

  February 28, 2011 at 12:30 pm   Posted in: Administrative Law, Architecture, Technology   Print This Post   One Comment

Nondelegation and the Bank

posted by Gerard Magliocca

I’m going to observe a “no individual mandate” posting policy for a while. That issue has been flogged to death and there’ll really be nothing new to say until the circuit courts issue their opinions.

So let’s try out something on the nondelegation doctrine.  Most people don’t know that the first major controversy where this argument was made involved the Second Bank of the United States.  Consider these portions of Andrew Jackson’s Veto of the Bank:

“The Government is the only ‘proper’ judge where its agents should reside and keep their offices, because it best knows where their presence will be ‘necessary.’ It can not, therefore, be ‘necessary’ or ‘proper’ to authorize the bank to locate branches where it pleases to perform the public service, without consulting the Government, and contrary to its will. . . . The power which this act gives to establish two branches in any State, without the injunction or request of the Government and for other than public purposes, is not ‘necessary’ to the due execution of the powers delegated to Congress.”

“It is maintained by some that the bank is a means of executing the constitutional power ‘to coin money and regulate the value thereof.’ Congress have established a mint to coin money and passed laws to regulate the value thereof. . . . But if they have other power to regulate the currency, it was conferred to be exercised by themselves, and not to be transferred to a corporation. If the bank be established for that purpose, with a charter unalterable without its consent, Congress have parted with their power for a term of years, during which the Constitution is a dead letter. It is neither necessary nor proper to transfer its legislative power to such a bank, and therefore unconstitutional.”

Both of these passages (especially the latter one) make a nondelegation claim. Indeed, a similar point was advanced by the lawyers for Maryland in McCulloch, but Chief Justice Marshall ignored the issue in his opinion.

  February 7, 2011 at 2:02 pm   Posted in: Administrative Law, Uncategorized   Print This Post   No Comments

Linnaean Regulation in Health Insurance and Information Technology

posted by Frank Pasquale

I was recently listening to Health Affairs’s “Newsmaker Breakfast with Karen Pollitz.” She gave a fascinating presentation on the challenges she faces as she develops HealthCare.Gov as a portal for information about health insurance. As I noted a few years ago, health insurers can easily mislead consumers about the nature of their coverage, and disclosure charts can be very helpful.

But even disclosure charts run up against the slipperiness of language. Pollitz noted that for some plans, a “deductible” was not really a deductible; you could easily spend much more out-of-pocket on health care than the stated “deductible level” before coverage kicked in.

How can an individual make an informed choice when words lose their meaning in a tangle of qualifications and conditions? At what point does a deductible cease being a deductible? While this might seem like a relatively technical question of insurance regulation, it is reflects a more general information-gathering problem that will confront regulators in coming years. Scientists could only predict and control aspects of the natural world when they could be named and classified. Any successful regime of healthcare reform will depend, at a bare minimum, on a flexible yet standardized classification system that can map what health insurers are doing. Like Linnaeus patiently organizing a welter of living forms, regulators will need to taxonomize pullulating permutations of insurer practices.
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  January 22, 2011 at 10:47 pm   Posted in: Administrative Law, Health Law   Print This Post   No Comments

Heckuva Job, OIRA

posted by Frank Pasquale

Remember the massive 500 million egg recall back in August? At least 2,000 people reported illness from the eggs; countless others may have mistakenly blamed their misery on some other source of food poisoning. We are now beginning to understand how regulatory pathologies beyond the usual capture story allowed this entirely preventable outbreak of salmonella.

Lyndsey Layton’s article on salmonella-tainted eggs offers an excellent case study of the toxic consequences of deregulatory ideology and a broken “cost-benefit analysis” apparatus. Layton describes years of controversy over bad eggs, which appeared to finally resolve in the late 1990s as the most responsible egg producers realized the terrible reputational consequences they were suffering because of their wild west competitors:

In the spring of 2000, a deal was struck. The egg industry agreed that the federal government would for the first time set rules for egg farms. At a private meeting on the eighth floor of a sleek office building overlooking Washington’s Union Station, Klippen, representing the egg farmers, shook hands with Richard Wood of Farm Animals Care Trust, who was negotiating on behalf of consumer groups. The regulators looked on, approvingly.

“This is how government and industry are supposed to work together,” Judy Riggins, a policymaker at the USDA, whispered to Klippen. And then, nothing. For the next nine years, the government failed to deliver the rules.

Old battles between the USDA and FDA explain some of the lethargy. But I found most remarkable this intervention from the OMB, whose Office of Information and Regulatory Affairs performs cost-benefit analysis on proposed regulations:
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  December 12, 2010 at 12:09 pm   Posted in: Administrative Law, Economic Analysis of Law, Health Law, Law and Inequality   Print This Post   No Comments

Health Reform and Accountable Care Organizations

posted by Frank Pasquale

Critics of the ACA have frequently complained that the legislation does not do enough to improve quality or to cut costs. However, the Act did create incentives for new alliances of hospitals and doctors, known as “Accountable Care Organizations.” Now provider lobbies are demanding some pretty dramatic changes to health care regulation in order to implement ACOs. In this post, I want to explain what ACOs are, and why they challenge traditional health care regulatory models.
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  November 22, 2010 at 12:28 pm   Posted in: Administrative Law, Antitrust, Health Law   Print This Post   No Comments

Liar Loans: White-Out & Scotch Tape at the Subprime Art Department

posted by Frank Pasquale

Doug Henwood has a good eye for the best of recent business analysis. Henwood’s interview with Michael W. Hudson (about Hudson’s new book, “The Monster”) is a must-hear for those interested in the subprime mess. From the book website:

This book tells the story of . . . subprime by chronicling the rise and fall of two corporate empires: Ameriquest and Lehman Brothers. . . . By the height of the nation’s mortgage boom, Orange County was home to four of the nation’s six biggest subprime lenders. Together, these four lenders—Ameriquest, Option One, Fremont Investment & Loan, and New Century—accounted for nearly a third of the subprime market. . . .

Under its pugnacious CEO, Richard Fuld, Lehman helped bankroll many of the nation’s shadiest subprime lenders, including Ameriquest. “Lehman never saw a subprime lender they didn’t like,” one consumer lawyer who fought the industry’s abuses said. Lehman and other Wall Street powers provided the financial backing and sheen of respectability that transformed subprime from a tiny corner of the mortgage market into an economic behemoth capable of triggering the worst economic crisis since the Great Depression. . . .

[Helped by Lehman,] Ameriquest Mortgage unleashed an army of salespeople on America. They numbered in the thousands. They were young, hungry, and relentless in their drive to sell loans and earn big commissions. One Ameriquest manager summed things up in an e-mail to his sales force: “We are all here to make as much f****** money as possible. Bottom line. Nothing else matters.” [This activity] helped fuel the mortgage empire that in 2004 produced $1.3 billion in profits [for Ameriquest's CEO].

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  November 14, 2010 at 8:25 pm   Posted in: Administrative Law, Corruption, Economic Analysis of Law, Law and Inequality, Property Law   Print This Post   One Comment

Emory Law Journal, Vol. 60, Issue 1 (October 2010)

posted by Emory Law Journal

  October 19, 2010 at 10:25 am   Posted in: Administrative Law, Articles and Books, Constitutional Law, Current Events, Law Rev (Emory)   Print This Post   No Comments

Structural Fragmentation

posted by Abigail Moncrieff

First, I too will add to the chorus of thanks to Frank and Glenn for inviting me to participate.  Healthcare fragmentation is an important — and difficult — topic, and the new book, The Fragmentation of U.S. Health Care: Causes and Solutions, is an important contribution in tackling the issue.  I’m honored to be contributing to the discussion.

My goal here is to highlight a meta-problem in the American healthcare system that overlies many of the fragmentation issues identified in the book and in my colleagues’ blog posts so far:  structural fragmentation in the healthcare regulatory complex.  If we want a coherent system that operates coherently, we must have a simple answer to one simple question: Who’s in charge?  For healthcare, we have no answer.

The general problem is that the U.S. government is self-consciously layered with overlapping jurisdictions and competing regulatory bodies, intended to slow the growth of government and to check the rise of tyranny.  We’ve created a governmental system in which states compete with the national government, states compete with one another, courts compete with executive agencies, executive agencies compete with legislatures, and legislatures… are legislatures.  Some legal fields have smoothed this chaos in our regulatory structure, defining authority clearly among the competing institutions.  Healthcare?  Not so much.  I’ll list and elaborate a few discrete examples of this problem within two categories — federalism and separation of powers — but there are far too many examples to cover all of them in this short blog post.

Federalism

One cause of structural fragmentation for healthcare regulation is in the federalist division of labor for various healthcare programs.  Here, the first thought is Medicaid.  The “cooperative” federalism structure for Medicaid is not cooperative at all; it’s barely coordinated.  The federal Medicaid Act, which started out with 22 requirements for state plans to qualify for federal funding, now lists literally hundreds of such statutory requirements, not including countless others in the Federal Register.  But very few of them are enforced.  Does this structure lead to a “race to the bottom” among the states in providing public health insurance to the poor?  Maybe, maybe not.  Either way, the program is a many-headed beast that functions poorly, due in part to fragmented regualtory authority.  A retort from within healthcare might be the State Children’s Health Insurance Program (SCHIP), which is also a “cooperative” federalist program that has had greater success.  Why?  In part because it uses block grants instead of entitlement grants — fewer federal strings attached — and in part because it’s still just very small.  Another federalism problem is the problem of Healthcare’s Federalization Snowball: The federal government pays for 40% of healthcare utilization in the United States, leaving any given state with something less than a full financial incentive to curb over-utilization of healthcare.  (Fragmentation in payment systems – even if single payer isn’t a panacea, it would at least solve this problem.)  Unfortunately, PPACA failed to resolve the existing federal fragmentation and added a few more instances of it:  The Exchanges in the final bill are strange beasts for federalism; the states are required to implement their own (50 fragmented exchanges instead of 1 cohesive one), but if any state fails to implement an exchange by 2014, the national government will create one for it.  (Who’s in charge??)  PPACA requires the exchanges to include some insurance plans that are sold nation-wide and imposes new federal requirements for all private plans, taking a first step in nationalizing the private market for health insurance, but it doesn’t get us all the way there.  Instead, it adds some national oversight authority in the Department of Health and Human Services (HHS) without abolishing state authority, creating further fragmentation and jurisdictional overlap.  And let’s not forget the Employment Retirement Income Security Act (ERISA), which still preempts a lot of state authority without creating a national regulatory regime in its place and which contributes significantly to fragmentation among insurance markets (creating a unique regulatory space for employer-sponsored large-group plans).  In short, the fragmented world of healthcare regulation is further fragmented by complicated and often incoherent divisions of labor between the state and national governments.

Separation of Powers

Another important cause of structural fragmentation is in the odd divisions of labor among branches of government and even within single branches of government.  Most obviously, we’re still not sure whether we want courts or agencies to be in charge of healthcare regulation.  Medical malpractice is still primarily a matter for judicial (common law) regualtion, but CMS and private insurers (regulated by executive insurance commissioners and now exchanges) are getting more and more involved in quality control.  And the courts’ authority to review decision-making in Medicare and Medicaid is in flux as the Supreme Court grapples with the scope of Section 1983 and with the general rules for judicial deference to agency interpretations.  In short, authority has been migrating from courts to agencies (not just in healthcare), but for the moment, we’re in an uncomfortable position of “neither here nor there.”  Perhaps because of that uncomfortable position, the jurisdictional structure within the national executive is messy.  To give two examples:  (1) The Department of Labor, the Department of Health and Human Services, and the Treasury Department all have some degree of authority over Employer-Sponsored Insurance, and (2) the Food and Drug Administration and the Attorney General (not to mention the Patent and Trademark Office and CMS) have overlapping authority in regulating drugs and other controlled substances.  This is to say nothing of the multitudinous state agencies that share authority among themselves and with the national agencies in these regimes and others.  In addition to the well-known conflicts between courts and agencies, there are also conflicts between courts and legislatures, which are less frequently considered as separation of powers problems.  The general questions of statutory interpretation and judicial deference to agency delegations, however, is a separation of powers question that has been significant for healthcare regulation.

A Final Note

What are the most successful and most beloved healthcare programs in the United States?  The first answer that pops to mind is probably Medicare.  We could add to the list the Military Health System (MHS) (including VA healthcare and TRICARE for members on active duty) and the Federal Employees Health Benefits Plan (FEHBP).  What do these programs have in common, aside from being publicly funded insurance programs (which also describes the unsuccessul and unpopular Medicaid)?  I don’t want to oversell my thesis, but I find it telling that each of these programs has a single, well-defined head.  Not that they’re monolithic; Medicare contracts with private administrators to manage benefits and even to make variable local coverage determinations.  But authority over Medicare resides comfortably within HHS; authority over the MHS resides comfortably within the Department of Defense; and authority over FEHBP resides comfortably within the Office of Personnel Management. 

We need to defragment our regulatory structure.  In my opinion, that’s step one.

  October 14, 2010 at 2:03 pm   Posted in: Administrative Law, Constitutional Law, Health Law, Politics, Symposium (Health Care Fragmentation)   Print This Post   2 Comments

Rejecting Refugees

posted by Jaya Ramji-Nogales

The New York Times today reports on my most recent co-authored empirical study of the U.S. asylum system, Rejecting Refugees: Homeland Security’s Administration of the One-Year Bar to Asylum, forthcoming in the William and Mary Law Review. As the title suggests, this article focuses on asylum law’s one-year filing deadline, which was created by the 1996 Illegal Immigration Reform and Immigrant Responsibility Act (IIRIRA). Scholars and practitioners have long expressed concern that refugees have been denied asylum due solely for failure to apply within a year of entry, and fear that the bar has had a significant impact on the U.S. asylum system. Our article is the first systematic empirical study of the effects of the deadline on asylum seekers and the asylum system.
We focus on decision-making by the Department of Homeland Security, which adjudicates most applications for asylum in the first instance. The findings are troubling. Most notably, it is likely that since the one-year bar came into effect, in April 1998, through June 2009, DHS rejected on the deadline more than 15,000 asylum applications (affecting more than 21,000 refugees) that would otherwise have been granted.
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  September 30, 2010 at 6:45 am   Posted in: Administrative Law, Immigration   Print This Post   6 Comments

Why Don’t You Need IRB Approval to Talk About People in Cases?

posted by Dave Hoffman

Legal archaeology is a term sometimes used to refer to scholarship that brings a rich context to famous cases.   If you were a legal researcher seeking to enrich a modern classic – e.g., Pepsico [contracts], Lawrence [con law], Liebeck [torts], Twombly [civ pro] – you might proceed by interviewing the parties and their attorneys, examining prior and related cases, and boning up on the briefs and exhibits.  It seems pretty clear to me that before undertaking such research, a prudent professor would check in with their IRB.  The interviewing of the parties and their attorneys in particular doesn’t appear to be clearly covered by any exemption, and I imagine that at least expedited review would be indicated.

But how about simply writing about living parties – or judges – in modern cases? It would seem inconceivable to go to the IRB before writing about, say, Yaser Hamdi.  Well, you never know how your local IRB will deal with novelty.  So let’s go back to the basics.   Is this research under Section 46.102? Arguably: it is a “systemic investigation . . . designed to contribute to generalizable knowledge.”  Is it research regarding human subjects? Well, under 46.102(f), human subjects are people you collect data from through actual contact or those who you collect data that is otherwise private.   Private information “includes information about behavior that occurs in a context in which an individual can reasonably expect that no observation or recording is taking place, and information which has been provided for specific purposes by an individual and which the individual can reasonably expect will not be made public (for example, a medical record).”  Are their facts about behavior disclosed in judicial opinions which fit this definition?  I can think of many: disclosure of facts from police reports, medical records, taxes, etc.  Indeed, most opinions disclose facts about individuals that they’d never, ever, want told to the public, and were forced to disclose only through contentious discovery.  Quite often, the discovery contained stipulations of confidentiality that bind the parties, but not the court.

Nevertheless, it’s clear that writing about such personal facts in released opinions is in fact exempt from IRB review, since a judicial opinion is, under 46.101(b)(4), a public record.  So you might think that this entire exercise is academic.  And for some IRBs, it would be.  But most IRBs would take the position – if asked – that researchers must submit an application to them, so that the board can evaluate the claim for exemption.  This is a slam dunk case for exemption, but that doesn’t mean that the professor gets to decide for herself that no application is necessary.  Of course, I’ve never heard of a law professor submitting to an IRB before writing an article about a recent case of interest, even when discussing the most personal facts relating to the parties or the judge. In fact, some articles about particular judges  have created political scandals of some note.  Unless I’m mistaken about any of the previous analysis, I think that means that most law professors, some of the time, are not in technical compliance with a set of (very silly and possibly unconstitutional as applied) regulations.  Ironically, it is probably constitutional law professors, who write about recent cases involving individual parties most often,  who are the prime violators.  If your law school has not reached a general understanding with your local IRB about how to proceed, it should.

Thoughts?

  September 1, 2010 at 3:04 pm   Posted in: Administrative Law, Bioethics, Constitutional Law, Empirical Analysis of Law, Law School (Scholarship)   Print This Post   6 Comments

Anti-Business? Or Anti-The Worst Businesses?

posted by Frank Pasquale

A good, socially responsible business can’t make a profit if its competitors are free to trash the environment, impoverish and injure their workers, and evade the law. Don Blankenship knows that, and that’s why he’s on the warpath against the Obama Administration:

As CEO of Massey Energy, [Blankenship] has presided over a coal company that had thousands of violations in recent years, leading up to the April explosion that killed 29 of his miners. . . . [At the National Press Club, the] CEO was asked what he could have done to prevent the deadly explosion. “I probably should’ve sued MSHA” — that’s the federal Mine Safety and Health Administration — “rather than waiting” until now, he said. In the future, he added, “you’ll see not only coal companies but many companies resist the efforts of EPA and others that are impeding their ability to pursue their careers, or their happiness.” . . . .”There’s 42,000 people killed a year on the highways,” the coal boss offered as a way to put his miners’ deaths in perspective.

As James K. Galbraith noted in his book, The Predator State, there are too many members of our political class who want to help Mr. Blankenship pursue his law of the jungle vision of capitalism. Promoters of carte blanche deregulation are not “pro-business;” rather, they’re helping one, irresponsible part of the private sector outcompete other parts of it. As Galbraith argues,

Imposing standards, and enforcing them, is . . . the general policy response to . . . the reactionary forces within business who see to maintain competitiveness without technological improvement, without environmental control, without attending to product or workplace safety. They are the forces behind deregulation.

The business community is diverse; some companies care a great deal about their workers, whereas other treat them as little more than an expendable human resource. For example, in one time period, BP had over 700 “egregious, willful” OSHA violations, and Exxon had only one. A civilized society does not allow companies like BP and Massey to gain a competitive edge by endangering workers and the environment. Only a kakistocracy accepts a kakisteconomy.

Image Credit: Poster for the film The Corporation, which includes an interview with an inspirational figure for sustainable business, Ray Anderson (the CEO of Interface, the world’s largest carpet manufacturer).

  July 25, 2010 at 9:43 am   Posted in: Administrative Law, Economic Analysis of Law, Technology, Uncategorized   Print This Post   9 Comments

Seeing the Law Through Crude-Colored Glasses

posted by Frank Pasquale

As might be expected in such a politically charged situation, groups are charging that the district court judge who “struck down the Obama Administration’s six-month moratorium on new deep water drilling” had oil-related interests that could have influenced his decision. Now the WSJ Law Blog reports that the Alliance for Justice has prepared a report on the oil ties of two of the three judges on the appellate panel that will review the district court judge’s finding.

I imagine all these judges might point to the Scalia non-recusal in Cheney v. United States District Court to justify their own decisions to hear the case. Michael Dorf had an interesting perspective on that controversy, where the underlying litigation concerned a “2001 advisory committee on energy policy that Vice President Cheney headed.” Here are some lines from Justice Scalia’s memorandum refusing to recuse himself:

For five years or so, I have been going to Louisiana during the Court’s long December-January recess, to the duck-hunting camp of a friend whom I met through two hunting companions. . . Our friend and host, Wallace Carline . . . runs his own company that provides services and equipment rental to oil rigs in the Gulf of Mexico.

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  July 11, 2010 at 10:29 pm   Posted in: Administrative Law, Corruption, Politics, Supreme Court   Print This Post   3 Comments

Some Realism About Interventionism

posted by Frank Pasquale

(This is Part 2 of a review of Ian Bremmer, The End of the Free Market: Who Wins the War Between States and Corporations? (Portfolio, 2010); Part 1 appears here.)

Throughout his book, Bremmer contrasts “state capitalist” regimes (where the government is the lead economic actor) with “free market” nations which preserve more room for private initiative. While virtually every country has a few state-owned enterprises (SOE’s), in state capitalist regimes like China SOE’s predominate in “diverse sectors” and are used to enhance the political power of government (65). Such regimes also intervene in the economy pervasively. For example, Russia in 2008 “identified forty-two ‘strategic’ economic sectors in which restrictions applied for foreign investment” (109). In a chapter entitled “State Capitalism Around the World,” Bremmer piles up a litany of suspect interventions in places ranging from Nigeria to Mexico to Saudi Arabia.

Bremmer paints a stark contrast between the economies of liberal democracies and the state capitalist other. But at least since legal realist Robert Hale published his Coercion and Distribution in a Supposedly Non-Coercive State in 1923, the question of what constitutes state “intervention” in the market has been contestable. For example: at what point does licensing of doctors move from being a natural aspect of any competent health system to being termed a suspect “intervention”? If there is to be free trade in services, don’t we at least need some information about what constitutes genuine medical care? “Perfect information” is a cornerstone of idealized markets—isn’t some baseline of information necessary to any actual market?

Bremmer does not talk much about health care in his book, but it appears to be one important sector where the relative role of the government in state capitalist and “free market” regimes is flipped. On a cursory reading of Blumenthal and Hsiao‘s 2005 article in the NEJM, the US would appear to be more interventionist than China:
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  July 5, 2010 at 8:17 pm   Posted in: Administrative Law, Corruption, Current Events, Economic Analysis of Law, Philosophy of Social Science, Politics, Sociology of Law   Print This Post   No Comments

Book Review: Kysar’s Regulating From Nowhere

posted by Jamison Colburn

Regulating From Nowhere: Environmental Law and the Search for Objectivity.  By Douglas A. Kysar.  New Haven, CT: Yale University Press.  2010.  Pp. vii, 314.  $45.00

Regulating From Nowhere is a beautifully written book that would pay dividends even to the casual reader looking for a sharp treatment of the state of environmental regulation in America.  Beneath the surface, though, it is a powerful argument that our environmental law’s “redacted script”—wherein all our legislated texts of the 1970s, ‘80s, and ‘90s lead inexorably to welfare economics and its reigning orthodoxy, cost-benefit analysis—is leading us away from our ideals.  Kysar makes this argument energetically, even passionately at times.  He shows how, time after time, in context after context, cost-benefit analysis as it’s been structured has failed us in our search for any truly objective measurement of our national commitment to environmental quality as against, say, individual autonomy.  The ideologues who keep insisting still today that “willingness to pay” surveys or the other crude tools economists are taught to use as metrics of valuation are all we have to interpret these statutes will find this book disconcerting, I’m sure.  For it makes no apologies in arguing that we among the living and powerful today have deeper obligations—obligations to other cultures, future generations, and to nonhuman life—than our ‘willingness to pay’ will ever reflect.

Still further below the surface is an incipient attack on the “value monism” inherent in any conception of “public welfare” yet devised.  This is easily the boldest aspect of a bold book and I hope it gets a wider audience than, say, the few hundred legal and economics academics who dwell on the use of cost-benefit analysis in regulation today.  A value monist, in Kysar’s view, sees “environmental values” like clean streams, biodiversity, or functioning wetlands, as fungible benefits that can and ought to be liquidated in some way so that they can be allocated to the highest bidder (usually, the highest bidder of money).  Pluralist or “expressivist” versions of value deny that any such translatability can be achieved, in theory or in practice.  Places and times are unique in their valuations of “organic unities” like clean streams, estuaries, or biodiversity, an argument made by philosophers like G.E. Moore and David Ross many, many years ago.  The problem, of course, is that that mode of valuation is essentially inaccessible to the modern administrative agency.  How would an agency like EPA, the legal embodiment of a large, aggregative jurisdiction, sort out the organic unities that are to be valued as wholes from the commodities or commodity storehouses (like coal mines, corn fields, and cows) on which our modern economy rests?  If EPA’s actual record of regulation prior to the onset of its now enveloping cost-benefit neuroses is any measure, administrative agencies like EPA are just not the kind of institution where organic unities go to be properly valued. Read the rest of this post »

  July 5, 2010 at 5:59 pm   Posted in: Administrative Law, Book Reviews, Environmental Law   Print This Post   3 Comments

Welcome to the Blogosphere, Pareto Commons

posted by Frank Pasquale

I just wanted to highlight the new blog in town, Pareto Commons, which will be focusing on regulation. I’m not a huge fan of Pareto, but I’ll forgive the name when it comes to great content like this:

Lawrence Baxter on hedge fund tax breaks.
Kim Krawiec on “rogue traders.”
Lawrence Baxter on BP.

It looks like Jennifer S. Taub has also joined the blog. Taub is an invaluable guide to the financial crisis, and I really look forward to more posts like this. Krawiec’s coverage of the saga of Kerviel (both at Pareto Commons and the Faculty Lounge) will also be an informative read for anyone intrigued by books like Adam Haslett’s Union Atlantic.

  June 22, 2010 at 10:20 pm   Posted in: Administrative Law, Blogging, Corporate Law, Economic Analysis of Law, Politics   Print This Post   No Comments

Outsourcing Safety. . . to the Marshall Islands

posted by Frank Pasquale

Just when you thought the BP mess could not get more surreal, this comes up:

The Deepwater Horizon oil rig that exploded in the Gulf of Mexico was built in South Korea. It was operated by a Swiss company under contract to a British oil firm. Primary responsibility for safety and other inspections rested not with the U.S. government but with the Republic of the Marshall Islands — a tiny, impoverished nation in the Pacific Ocean. And the Marshall Islands, a maze of tiny atolls, many smaller than the ill-fated oil rig, outsourced many of its responsibilities to private companies.

Now, as the government tries to figure out what went wrong in the worst environmental catastrophe in U.S. history, this international patchwork of divided authority and sometimes conflicting priorities is emerging as a crucial underlying factor in the explosion of the rig.

Sounds a bit like asking a government to certify the safety of investments—and having it effectively delegate the job to Nationally Recognized Statistical Rating Organizations. Keeping authority in the US may have just made matters worse:

MMS depends largely on the self-reporting of oil and gas companies to determine how much they owe in royalties — a system the Interior Department’s former inspector general, Earl Devaney, described as “basically an honor system” in congressional testimony in 2007. . . . The MMS commonly negotiates settlements with petroleum companies over disputed royalties — but the process is often shrouded in secrecy. A 1996 inspector general report found that MMS officials kept no documents on nine out of 10 royalty settlements, to prevent disclosure under the Freedom of Information Act. In one case, the MMS could provide no records to explain why the agency reduced its estimate of a company’s royalty debt by $360 million. . . . [More errors] sparked outrage in Congress and yet another probe by Devaney, the inspector general. He later called the oversight a “jaw-dropping example of bureaucratic bungling” and said it could cost the government as much as $10 billion.

It has become fashionable of late to contrast enlightened, US-style “free market capitalism” with the “state capitalism” of petro-states like Russia. Anyone familiar with the work of David Cay Johnston or James K. Galbraith would suspect that analysis. Recent oil debacles complicate the distinction even further.

  June 18, 2010 at 12:23 pm   Posted in: Accounting, Administrative Law, Economic Analysis of Law   Print This Post   No Comments

On the Colloquy: Military Sexual Status Regulation, Artificial Intelligence, Black Holes, and more…

posted by Northwestern University Law Review

In the past month, the Northwestern University Law Review Colloquy has published essays relevant to current events and debates.

Professor Zachary Kramer writes in his essay that the U.S. military should not be in the business of regulating sexual status. Rather, the military should focus on regulation of sexual conduct for both hetero- and homosexuals.

Professor John McGinnis discusses a recent major media interest, Artificial Intelligence, and what the best government response to its development should be. He argues that, rather than prohibition or heavy regulation, the government should support the development of so-called “friendly AI,” to both prevent potential threats and develop the many benefits of it.

Several legal scholars, notably Professor Adrian Vermeule, contend that the APA is replete with procedural exceptions, which generate “black holes” where federal agencies are free to act outside the constraints of legal order. Unlike Professor Vermeule, Professor Evan Criddle argues that such black holes are not institutional inevitabilities. Rather, administrative law should be reformed to promote a culture of justification, based on the principle that public officials and agencies serve as fiduciaries for the public.

Finally, in Professor Martin Redish’s new book, Wholesale Justice, he provides a thorough analysis of the constitutional implications of the class action mechanism. In his book review, Douglas Smith expands upon these ideas and discusses other ways in which Professor Redish’s theories may be applied in practice or in which the constitutional concerns he identifies may already be recognized.

For more, go to the Colloquy archives page, and remember to check back each week for new content.

  April 28, 2010 at 4:34 pm   Posted in: Administrative Law, Constitutional Law, Current Events, Law Rev (Northwestern), Law Rev Forum, Science Fiction   Print This Post   One Comment

Data Mining for Juvenile Offenders

posted by Danielle Citron

Suppose that a fifteen-year old girl is convicted of theft.  After time in the juvenile justice system, the girl is obliged to participate in a rehabilitation program.  If she lives in Florida, a data mining program will suggest a particular program for her.  Florida State Department of Juvenile Justice recently announced that will be using IBM predictive analytics software to reduce recidivism.  According to IBM, the software helps identify at-risk youth who “can then be placed in programs specific to the best course of treatment to ensure offenders do not re-enter the juvenile justice system.”  It analyzes “key predictors such as past offense history, home life environment, gang affiliation, and peer associations to better understand and predict which youths have a higher likelihood to re-offend.”  The Vice President of predictive analytics at IBM explained that “[p]redictive analytics gives government organizations worldwide a highly-sophisticated and intelligent source to create safer communities by identifying, predicting, responding to, and preventing criminal activities.  It gives the criminal justice system the ability to draw upon the wealth of data available to detect patters, make reliable projections, and then take the appropriate action in real time to combat crime.”  Florida’s hope is that if youth are “rehabilitated with effective prevention, intervention, and treatment services early in life, juveniles will not enter the adult corrections system.”

Providing well-tailored rehabilitation services to juvenile offenders like our fifteen year old can be valuable if it indeed delivers on its promise.  Nonetheless, as states further automate important government decision-making in this way, they ought to address potential troubling uses of the program’s recommendations.  Mission creep is surely possible.  Although initially used to recommend a rehabilitation program, the program’s findings could be shared with other agencies.  For instance, a finding that a youngster has a high likelihood of recidivism may impact that person’s educational opportunities.  The United Kingdom’s Ministry of Justice uses IBM’s analytics software to “assess the likelihood of prisoners re-offending upon their release to help improve public safety.”  It is unclear if the Ministry employs the data mining program to tailor rehabilitation programs or if law enforcement instead has more far-reaching use, such as the monitoring of recently released offenders apart from their parole.  Michael Pinard has done important work on the damaging collateral consequences of convictions: flagging someone as likely to re-offend has great potential to add to that problem.

  April 21, 2010 at 3:56 pm   Posted in: Administrative Law, Criminal Law, Current Events, Privacy   Print This Post   One Comment

FOIA in a Holder World: Cloudy with a Chance of Rain

posted by Danielle Citron

A little over a year ago, Attorney General Eric Holder issued a memorandum requiring agencies to administer FOIA with a “clear presumption of openness.”  This changed the playing field considerably, at least on paper.  Under the prior Administration’s policy,  agencies could disclose information only after “full and deliberate consideration of the institutional, commercial, and personal privacy interests that could be implicated.”  By contrast, the current Administration told agencies to err on the side of disclosure even where an exemption applied and to consider partial disclosure if it could not make full disclosure of a record.  The Holder memo explained that the DOJ would defend a denial of a FOIA request only if an agency “reasonably foresees that disclosure would harm an interest protected by a statutory exemption.”  (The Ashcroft memo declared its commitment to defending FOIA denials unless they lacked a sound legal basis).  At the time, FOIA guru Dan Metcalfe, impressed with President Obama’s “transformative” commitment to transparency, noted that the real issue was how agencies put the memo into practice.

Now, just over a year later, we have some evidence regarding the Holder memo’s efficacy.  The National Security Archive at GWU recently released an audit of federal agencies’ administration of FOIA since this Administration issued its transparency directive.  As the audit entitled “Sunshine and Shadows: The Clear Obama Message For Freedom of Information Meets Mixed Results” noted, while some progress has been made in increasing transparency, more pressure and leadership is needed to that end.  For instance, “[a]ncient requests — as old as 18 years — still persist in the FOIA system” and only four of the 90 agencies show increases in releases and decreases in denials.

The audit’s most significant findings involved agencies’ actual response to the Holder memo, either by explicitly changing their internal policies or training employees.  The good news: 38 out of 90 agencies did something.  Thirteen agencies have implemented concrete changes in practice as a result of the memo; 14 have made changes in staff training; and 11 agencies circulated and discussed the memo.  The bad news: 52 agencies either told the auditors that they have no records that demonstrate how they implemented the Holder memo (35) or provided no response at all (17).

Without training and discussion of the Holder memo’s impact, agency employees will likely continue past practices.  This may indeed be the case as there isn’t a clear upward trend in disclosure as compared to the past.  While four agencies showed an increased rate of disclosure and a decreased rate of withholdings, five agencies released less and withheld more than they did a year ago and 18 of the 28 agencies that handle more than 90 percent of FOIA requests governmentwide had a mix of increased or decreased releases or withholdings.  Of course, this could be just a matter of having enough time to get the backlog cleaned up and then turning in earnest to training staff.   Senators Leahy and Cornyn have introduced legislation to bring this process along, at least in terms of agency responsiveness to FOIA requests.  Their proposed Faster FOIA Act would establish an advisory panel to examine agency backlogs in processing requests.  On a broader level, many aspects of this Administration aren’t as different from the previous one as one might suspect and so it is interesting to think about this issue in terms of the President’s broader transparency agenda.  But as to this specific issue, it will be interesting to see if the Holder memo is as transformative in practice as it is in theory.

  April 7, 2010 at 5:14 pm   Posted in: Administrative Law   Print This Post   One Comment

Fordham Law Review Symposium on April 16 & 17: The Adequacy of the Presidential Succession System in the 21st Century

posted by Fordham Law Review

The Fordham Law Review is organizing this event along with former Fordham Law School Dean John D. Feerick, a preeminent scholar on the Twenty-Fifth Amendment, and former Senator Birch Bayh, framer of the Twenty-Fifth Amendment.

The event is a two-day symposium, bringing together leading thinkers and experienced practitioners in the area of presidential succession: Former Senator Birch Bayh, who, as framer of the Twenty-Fifth Amendment and chairman of the Senate Subcommittee on Constitutional Amendments, oversaw the hearings and debate on the topic; those who were on the front lines in developing the presidential succession structure (Fred Fielding, former White House Counsel to Presidents Ronald Reagan and George W. Bush, and Benton Becker who served as Counsel to President Ford); those who have written on the subject from a variety of perspectives (Professors Akhil Amar, John Feerick, Edward Foley, Joel Goldstein, Robert Gilbert, and Rose McDermott); Dr. John Fortier and Norman Ornstein, whose work on the Continuity in Government Commission has evaluated the adequacy of this system in a post-9/11 world; Constitutional Law scholars Dean William Treanor, Professor James Fleming, and Robert Kaczorowski; as well as Bill Baker, President Emeritus of WNET.ORG.

The Fordham Law Review will publish the symposium in its December 2010 issue.

Among a number of topics that will be discussed are the ambiguities in the existing constitutional provisions (for example, can presidents invoke the inability provision of the Twenty-Fifth Amendment to temporarily step down during moments of political crisis?); analysis of the constitutionality of the current Succession Act, which puts members of Congress in the line of succession; recommendations for handling a double vacancy in the Presidency and Vice Presidency and the constitutionality of current proposals for dealing with such a dilemma; important gaps and conflicts at various stages of transition (for example, disability or death prior to election or inauguration and potential conflict of interests arising in confirmation hearings of an appointed Vice President); and the constitutionality of informal—extraconstitutional and extrastatutory—arrangements between Presidents and their Vice Presidents, members of their cabinet, and members of Congress.

WHEN:
Friday, April 16 from 9:30 to 5:00 and Saturday, April 17 from 9:30 to 1:00
WHERE:
Fordham Law School
McNally Amphitheatre
140 West 62nd Street
New York, NY 10023
This event is free and open to the public.
Full Schedule here.

  April 6, 2010 at 12:23 am   Posted in: Administrative Law, Conferences, Constitutional Law, Current Events, Law Rev (Fordham), Politics   Print This Post   No Comments

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