Charles H. Koch, Jr., the Devolution of Implementing Policymaking in Network Governments

• Publication year: 2007

THE DEVOLUTION OF IMPLEMENTING POLICYMAKING IN NETWORK GOVERNMENTS

Charles H. Koch, Jr.^*

An undeniable, but often lamented, reality of modern government is that substantial policymaking must take place at the implementation stage. Legislative and executive authorities simply cannot resolve all policy issues, and they often find it politically inadvisable to do so. The danger, of course, is that efficiency or expediency will overwhelm the legitimate allocation of responsibility between the political authorities and the administrative authorities. The balance between democratic legitimacy and effective government thus dictates the delegation of the implementing authority. The more complex the society and the more complicated the demands on government, the more elusive this balance becomes.

Legal principles regulating delegations of authority suggest that authority should be delegated based on hierarchy. Yet even in hierarchical systems, influence moves not only up and down but also horizontally among the decisionmakers and institutions within the system. Moreover, policy is made at the lower levels of the hierarchy without the participation of the hierarchy's upper reaches. Regardless, not all governments, especially supranational ones, can be understood as mere hierarchies. Instead, the realities of governmental policymaking are complicated by questions of legitimacy.

Even more complexity is added when several governmental systems combine in some sort of federal organization. Recently, there has been a strong movement toward such organizations. Regions and ethnic groups in established nations and emerging nations alike are insisting on more autonomy. Nations are coming together to form a variety of supranational organizations, some quite broad in their mandates. These coordinated governments raise increasingly complex implementation and devolution issues. Traditional federal systems, such as the United States, have allocated shared authority through a divided federalism in which central and subunit administrative hierarchies are formally segregated and their respective powers are more or less clearly defined.¹

In contrast to this traditional federal organizational concept, the European Union (E.U.) is built around commingled responsibilities.²From the beginning, the member states have been integrally involved in the policymaking from the foundational legislation to implementation.³Their engagement has only increased over the years, as E.U. institutions tend to give the member states implementing discretion through framework measures and "soft" laws.⁴For these reasons, the E.U. system is most accurately characterized as a network, comprised of webs of interrelationships among E.U., national, and non-governmental institutions. Walter van Gerven observed, "While public authority was traditionally organized pyramidally along hierarchical lines, it is now also organized through numerous networks of public and private nuclei of power, making power move both vertically and horizontally."⁵Policymaking influences may combine in a nearly infinite variety of forms with policy moving down from the central authority, up from the member state governments, and horizontally among the member states and their institutions. Even within the E.U. and national institutions, policy development is not necessarily hierarchical.⁶

The E.U. network system requires innovations in the concepts and strategies of federalism. It exposes challenges in carrying out a unified, effective, and legitimate implementation of shared programs. Even though the U.S. Constitution aspired to a "more perfect union" among the several states,⁷ it has been held to establish an adversarial relationship between the central government and its states.⁸This divided federalism combined with the generally hierarchical allocation of authority presents a useful contrast to the E.U. network federalism. Network organization might have advantages and, regardless, may best describe many existing and emerging federal systems, both national and supranational.⁹Hence, the E.U. and U.S. experiences and mechanisms offer insights into how to design other federal systems.¹⁰

I. IMPLEMENTING POLICYMAKING

Beyond the separation of powers issue, governmental entities must also consider the legitimacy of delegations from the political bodies to the implementing bodies. The E.U. has somewhat paralleled the U.S. in accepting the necessity of delegating implementing policy. The evolution of the U.S. acceptance of that necessity goes back some distance and probably presages the ultimate development of E.U. delegation doctrine.

U.S. acceptance evolved through a long process. The earliest U.S. case on the need to delegate power to the implementing bodies is the 1892 opinion in Marshall Field & Co. v. Clark.¹¹Relying on a case decided early in U.S. history, The Cargo of the Brig Aurora v. United States,¹²the Supreme Court upheld a statute that gave the President authority to impose retaliatory tariffs if he "deemed" that American business was being treated unfairly. Justice

Harlan and a majority of the Court claimed that the President could do nothing under this statute but execute the acts of Congress. He claimed that the President "was the mere agent of the law-making department to ascertain and declare the event upon which its expressed will was to take effect."¹³While

Harlan's opinion suggested limits on the power to delegate, the case is seen as early recognition that Congress may delegate policymaking authority.¹⁴

The evolution of a generous delegation doctrine was slow but inevitable. In 1904, the Supreme Court in Buttfield v. Stranahan¹⁵upheld the delegation of power in the Tea Inspection Act to the Secretary of the Treasury to establish standards of tea purity. Subsequently, in United States v. Grimaud,¹⁶the Court-while analyzing the power of the Secretary of Agriculture to make forestry conservation rules-decided to lay down, as a criterion for delegation, the notion that Congress may establish a general statutory standard and delegate to the executive the power to "fill up the details" by regulation.¹⁷And finally, in J.W. Hampton, Jr. & Co. v. United States,¹⁸the Court in 1928 upheld another tariff statute and established the principle under which delegations are approved today: "If Congress shall lay down by legislative act an intelligible principle to which the person or body authorized to fix such rates is directed to conform, such legislative action is not a forbidden delegation of legislative power."¹⁹Over the years, the Court has accepted very general language as satisfying the "intelligible principle" requirement, so that no challenge is realistically available.²⁰A vigorous nondelegation doctrine has had judicial advocates over the years.²¹But, as Justice Blackmun found in Mistretta v. United States,²²"Applying this 'intelligible principle' test to congressional delegations, our jurisprudence has been driven by a practical understanding that in our increasingly complex society, replete with ever changing and more technical problems, Congress simply cannot do its job absent an ability to delegate power under broad general directives."²³By assuming the role to monitor the implementing authority, democratic accountability is permissibly removed by one level.²⁴

The potential for the same devolution of authority in supranational organizations can be demonstrated by examining the evolution of delegated authority in the E.U. Like in the U.S., the rejection of delegated authority, consistent with basic law, failed. Early in the E.U.'s history, delegation of policymaking authority seemed to be prohibited.²⁵In the 1958 case of Meroni

Id.

v. High Authority,²⁶the European Court of Justice (ECJ) severely limited authority delegations.²⁷Having been decided very early in the history of the European Community, this case set the parameters for delegation in a much simpler governmental context. Specifically, the court held that institutions may not "confer upon the authority, powers different from those which the delegating authority itself received under the Treaty."²⁸It also held that the delegation must involve "clearly defined executive powers the exercise of which can, therefore, be subject to strict review in the light of criteria determined by the delegating authority."²⁹The court dictated that the exercise of this power "must be entirely subject to the supervision of the [delegating institution]."³⁰Feeling that the delegation would upset the institutional balance envisioned in the Treaty unless all these conditions were met,³¹the court ruled that the delegation "gives those agencies a degree of latitude which implies a wide margin of discretion and cannot be considered as compatible with the requirements of the Treaty."³²

Still, scholars of European Law argue that limitations on delegation are not overly restrictive in reality. In fact, "the Meroni opinion might suggest to U.S. administrative lawyers no more restriction than the current state of the U.S. nondelegation doctrine."³³For example, if the court is interpreted to require "criteria determined by the delegating authority,"³⁴this requirement would be analogous to the "intelligible principle" requirement announced by the Supreme Court at the beginning of the twentieth century.³⁵However, Meroni could be interpreted to require that the delegating institution itself ultimately make the decision. This interpretation would explain the court's choice to include the language "subject to strict review . . . by the delegating authority."³⁶In short, Meroni's restriction may be interpreted in a variety of ways.

Yet, the Meroni decision's practical impact is overstated. As Geradin and Petit assert: "the implications of the Meroni doctrine should not be exaggerated."³⁷Geradin and Petit explain that the court's reliance on institutional balance naturally leads to acceptance of delegation to improve the quality of the decisionmaking body both...