Crisis bureaucracy: Homeland Security and the political design of legal mandates.

• Author: Cohen, Dara Kay

INTRODUCTION I. THE EVOLUTION OF HOMELAND SECURITY AFTER SEPTEMBER A. The Status Quo Before September 11 B. Shocks and Responses: The Immediate Aftermath C. Initial White House Resistance to Reorganization D. Shaping a Reorganization and Striking Legislative Bargains E. The Final Bill II. UPDATING POLITICAL THEORIES OF BUREAUCRATIC ORGANIZATION AND PERFORMANCE: THE POLITICAL-BUREAUCRATIC SYSTEM A. A Theory of Legislation: Inconsistent Objectives B. The Political-Bureaucratic System: Institutional Solutions to Delegation Problems 1. The imprint of legislative and executive politics on the delegation of statutory authority to bureaucracies 2. Two theoretical refinements C. Theoretical Conclusion:. Policies May Not Be Designed to Succeed III. APPLYING THE THEORY: THE ARCHITECTURE OF THE DEPARTMENT OF HOMELAND SECURITY A. The Political Influence of Congress B. The Political Influence of the White House C. The Role of the Post-September 11 Crisis D. Budget Politics and Legacy Mandates E. The Consequences of Reorganization IV. IMPLICATIONS A. Structural Politics and Agency Legal Interpretations B. Parallels with Previous Reorganizations CONCLUSION APPENDIX INTRODUCTION

Modern governments implement most legal mandates through bureaucracies. Politicians delegate authority by crafting legislative compromises, which lawyers and judges then seek to interpret. But bureaucratic agencies are often the entities that most directly wield the power to spend money, impose penalties, provide public services, and regulate individuals and organizations. Consequently, a central question in public law concerns who exactly controls the bureaucracy's power to interpret and execute law. Although legal scholars are consumed by normative debates concerning who should exercise such control, those debates are difficult to resolve or even follow in the abstract without some knowledge of the techniques used in the political process to control bureaucratic power over legal interpretations and over the execution of regulatory mandates. (1)

Surprisingly, the creation or reorganization of bureaucratic units--such as the new Department of Homeland Security (DHS)--remains among the least-understood techniques for controlhng bureaucracies. (2) We know politicians may create or reorganize agencies for multiple reasons: to appear as if they are addressing a salient policy, (3) to please organized interests most likely to be directly impacted by the agencies, (4) to create procedures that bias agency policy in particular directions, (5) and (perhaps more occasionally) genuinely to address a major problem of public concern in a prescriptively defensible manner. (6) We know far less, however, about how these different potential motivations interact, how agency structure is affected by major crises such as the September 11 terrorist attacks, or why politicians allocate different chunks of legal responsibility to distinct bureaucratic units. (7)

These gaps are evident in the persistence of many unsolved puzzles about the largest government reorganization in a half-century--the creation of the DHS. (8) For instance, why did the President support the creation of DHS after initially opposing it? Why did the Department become so vast, including in the reorganization a wide range of components with little or no responsibility for homeland security? We also understand little about whether the crisis enabled or forced politicians to forge a bureaucracy that actually enhanced the government's capacity to undertake security-related functions. Even as the creation and operation of DHS continues to inspire controversy, policymakers and scholars have yet to address these questions. (9) Nor have they been resolved in the wide-ranging criticisms leveled at DHS following the Katrina disaster, or in light of the national security threats the Department was nominally designed to address. (10)

The colossal new DHS melded the functions of twenty-two previously existing agencies, from Treasury's Customs Service, to Agriculture's Plum Island Animal Disease Center, to the previously independent Federal Emergency Management Agency (FEMA). Upon its creation, the Department gained regulatory authority over transportation security and matters as disparate as marine ecosystems and refugee admissions. Its ranks swelled with nearly a quarter of a million federal employees ranging from border inspectors to environmental compliance officers. Nothing of this scope had happened in the United States since the creation of the Department of Defense a half-century earlier. (11)

Even for reorganizations of smaller scope than that of the DHS or the Defense Department, the structural changes are unlikely to be solely symbolic, devoid of legal and policy consequences. Such an assumption ignores the aggressive infighting over structure among legislators, the executive branch, and organized interests. (12) Ignoring the significance of changes in bureaucratic structure also neglects the findings of work in political science and sociology, (13) and the legal doctrines vesting valuable discretion to interpret statutes in specific administrative agencies. (14) Yet we are only beginning to understand precisely how changes in structure shape the implementation of legal mandates, and how those changes would affect legislative bargaining over the contours of agencies such as DHS.

We propose to address these questions by combining a detailed analysis of the legislative process creating DHS with a new theory of the impact of bureaucratic structure on the execution of legal mandates. Our theoretical approach extends existing accounts of bureaucratic structure to address key features of the DHS case that also arise in other cases of bureaucratic change, especially the role of crises in loosening the constraints of organizational interests and the impact of senior legislators guarding their committee jurisdiction. (15) In the process, our analysis fills several gaps in the legal and political science literature concerning some matters, such as how reorganizations differ from familiar procedural techniques for controlling the bureaucracy, including environmental impact requirements or cost benefit analyses; how reorganizations may be enacted despite their adverse impact on the performance of widely held goals; and how Presidents, legislators, and organized interests sometimes bargain about bureaucratic structure in the shadow of an engaged, rather than disconnected, mass public.

As crises enlarge windows of opportunity for legislative action, policy changes in the area of concern--in our case, homeland security--can be driven by the efforts of politicians trying to affect regulatory and administrative activities in a different domain. Changes in the nature and scope of security policy may powerfully affect other legal and policy domains, such as the Coast Guard's environmental regulatory functions or the application of immigration laws. Moreover, politicians use the occasion of legislation to force changes in other areas having little to do with the principal issue being addressed. (16) While these themes are particularly relevant in the context of national and homeland security, they also hold important implications for the more-often-studied aspects of bureaucratic politics, affecting domains such as pharmaceutical and environmental regulation. In fact, politicians may endeavor to achieve policy- or control-related goals by strategically mixing security and nonsecurity functions within the same bureaucracy.

Against this theoretical backdrop, our account also yields answers to the DHS-specific questions. We argue that the President changed his mind about the reorganization in part because he did not want to be on the losing side of a major issue. But, more importantly, the Administration appears to have supported reorganization on such a massive scale to further domestic policy priorities independent of homeland security. By moving a large set of agencies to the new Department and giving them new homeland security responsibilities without the promise of additional budgets, the President all but forced these agencies to draw resources away from their legacy mandates.

Though such changes have unquestionably become part of the President's own legacy, fixing the precise extent to which he and his top advisers consciously schemed to weaken domestic legacy mandates without regard for a corresponding homeland security benefit must await the judgment of history. But our analysis does establish three crucial realities. First, the Administration eventually pressed for the largest possible Department despite the security-related risks of the merger identified by some of the Administration's own aides. Second, many of the key players participating in or affected by the Department's creation--including legislators and bureau employees-explicitly grasped how the merger threatened legacy mandates. Third, key features of the legislative progression culminating in the creation of DHS--in particular, the President's pledge of revenue neutrality and the White House's willingness to consider including agencies such as the Nuclear Regulatory Commission and the Federal Aviation Administration--make little sense without assuming that the White House harbored the goal of affecting the performance of legacy mandates, even if doing so failed to yield a corresponding security benefit. At a minimum, these realities suggest that the Administration became the fertile soil in which arguments supporting reorganization became deeply rooted--arguments that had glaring prescriptive problems, yet happened to serve many of the White House's political objectives.

From a prescriptive point of view, our conclusions are sobering. Our analysis shows how the merger adversely affected even those legal mandates plainly relevant to homeland security. (17) More generally, we explain how decisions about whether to create a new security...