Interest groups and the problem with incrementalism.

• Author: Levmore, Saul

Incrementalism, as opposed to dramatic change, is conventionally lauded in law as the prudent path of change--a path that gives credit to history and precedent. The conventional view, however, pays little attention to interest groups. Step-by-step change poses a serious problem when it rearranges the constellation of supporters and opponents of further moves. The core problem is that once an interest group loses and becomes subject to some regulation, it has reason to turn on its competitors and see to it that they also be regulated. The laws that emerge on the incrementalist's path therefore may not mark progress toward socially desirable or democratic outcomes. Examples of incrementalist laws include environmental standards, smoking bans, disability accommodations, and minimum-age legislation. Nearly all law, however, can be seen as incrementalist, just as most tradeoffs can be described as sliding on slippery slopes. The incrementalism problem is most striking when a prior regulatory step is costly to reverse from the perspective of those who must comply. The problem is alleviated when there is real learning from experience; it is exacerbated when advocates of change implement a divide-and-conquer strategy to separate defending interests. Compensation policies or even moratoria on certain kinds of regulation could possibly decrease wasteful rent seeking and minimize the interest-group problem.

INTRODUCTION I. I. INCREMENTALISM AND IRREVERSIBILITY A. The Incrementalism Problem B. Irreversibility C. Reversibility by Compensation II. LEARNING ON THE SLOPES III. COMPENSATION AND INTEREST-GROUP POLITICS A. Undercompensation and Overcompensation B. Power Politics C. Discretionary Compensation and Unproblematic Minimum-Age Legislation D. Incrementalism and Rent Seeking IV. DISCLOSE OR DELIMIT CONCLUSION INTRODUCTION

It is easy to encourage lawmakers to be moderate, or incrementalist. The case for incrementalism--under which regulation can provide for experimental stopping points that do not necessarily portend further movement along a slippery slope--is built on claims about unintended consequences, expectations, risk aversion, and learning by doing. Meanwhile, any proposal for sweeping change can be derided as the product of impatience and an inadequate appreciation of history and precedent. Incrementalists favor leaps over baby steps only when systems are regarded as beyond repair or bad habits need to be broken with shoves rather than nudges. The presence of multiple sources of law and interactive lawmaking may also encourage incrementalism. Since legislatures, courts, executive officers, administrative agencies, and even voters interact, incremental lawmaking is often the strategy most respectful of each player's role. In this stew, each cook is told to fear that drastic action will spoil the broth.

Leading commentators encourage incrementalism. (1) Most of the encouragement is directed at judges, but the arguments used in favor of incrementalism are equally applicable to regulators and legislators. Incrementalism might also mean different things to different observers: one person's moderation is another's drastic change, and every new law can be seen as a step toward far-reaching change. For present purposes, however, a proposal is incrementalist if advocates of more drastic change will support the proposal both because they approve the change it represents and because it may be a step toward their larger goal. It is, for example, incrementalist to propose a limitation on gun ownership or a smoking ban in limited areas with the aim of eventually prohibiting all firearms or smoking in all public places.

The conventional view of incrementalism pays little attention to interest groups. (2) There is a serious problem with piecemeal change, however, when it rearranges the constellation of supporters and opponents of further moves and gives organized interest groups reason to realign themselves in response to the incremental change. I begin with such matters as the prohibition of smoking in restaurants (while smoking remained legal in bars and hotels) and the requirement of ramps and other disability accommodations (initially in new buildings and then in some older structures). One can almost freely substitute, however, the imposition of progressively more exacting fuel-economy standards on automobile manufacturers and the establishment of incentives to achieve targeted reductions in the production of heat-trapping gases. (3) Incrementalism is everywhere--though certainly not everywhere alike. There is little reason to be confident that the laws that emerge on the incrementalist's path represent progress toward socially desirable or democratic outcomes--though I will make the realistic assumption in most of the examples here that we are uncertain about the location of the social optimum. Part I describes representative cases and explores what I call the "incrementalism problem." This problem is especially interesting when a prior regulatory step is irreversible from the perspective of those who must comply. Part II suggests that a common defense of incrementalism--that policymakers learn from experience and therefore from small, prior steps--is rather weak. The discussion extends the scope of the incrementalism problem to minimum-age legislation and to the larger topic of slippery (and nonslippery) slopes. Part III explores the idea of using compensation to solve the incrementalism problem. Compensation could push interest groups to form coalitions that can optimally defend against the divide-and-conquer strategy that is at the core of the incrementalism problem. This is an offshoot of the claim that, in a world with overachieving interest groups, we need organized groups to oppose one another in order to obtain desirable results. (4) This coalition-formation, or power-politics, approach to incrementalism, however, proves difficult to implement. One problem is specifying the conditions that trigger compensation; virtually every proposed law can be framed as embedded in a larger picture such that every law becomes a sly incrementalist move. Another problem becomes apparent when the focus shifts from power politics to rent seeking (i.e., resource-consuming activity undertaken to gain a profit or government-sponsored advantage). The possibility of obtaining compensation is likely to increase wasteful rent seeking by those who gain from influencing lawmakers. The problems with most things compensatory suggest a solution, sketched in Part IV, that begins with upfront disclosure of regulatory aims and then provides for a moratorium on regulation beyond a specified limit. Again, the problem is more apparent than the solution. A brief conclusion follows and suggests that incrementalism in lawmaking should be feared as often as it is welcomed. As the discussion works toward this conclusion, it has two aims, one positive and one normative. The positive aim is to develop a tool of analysis; the incrementalism problem and its possible solutions can help us to understand the path of lawmaking and the role of interest groups in forging that path. The normative aim is to argue against those who believe in moderation in all, or most, things. My claim is that this view of optimal change ignores the presence of interest groups.

1. INCREMENTALISM AND IRREVERSIBILITY

   1. The Incrementalism Problem

      Consider a case in which the American Association of People with Disabilities, or perhaps an advocate for disabled veterans, seeks to impose new building requirements in a jurisdiction that previously required accessibility only in new construction. The proposal mandates wheelchair-accommodating ramps in all commercial buildings, which would require substantial retrofitting. (5) Owners of these buildings are opposed, if only because compliance will be costly. These owners did not choose to install ramps before the law required them to do so, even though it might have helped them generate more revenue since most other buildings remained inaccessible. They will argue that disabled persons can work and shop in other buildings where ramps have been voluntarily constructed or where ramps have been required by law in new construction. These vulnerable property owners would like to gain political support from other groups, including their tenants, owners of multifamily residential buildings, small shop owners whose structures are likely excluded from the "commercial buildings" category, and perhaps even owners of single-family homes. But even the most sophisticated members of these groups are unsure whether to devote resources to opposing or supporting the proposal. From the perspective of shop owners, for example, the proposal will increase their competitors' costs, much as the previous legislation benefited many of them indirectly by raising the costs of new construction. Sophisticated owners recognize that advocates or lawmakers who champion the cause of mandated accommodations will likely advance their agenda step-by-step. Store owners and even homeowners might wonder whether lawmakers will eventually require them to modify their properties at significant cost and with a very small prospect of offsetting revenues.

      In the most straightforward version of what I will call the "incrementalism problem," the accommodation advocates consider only the benefits--not the costs--of accommodations and aim to push the law as far as they can. Perhaps they favor government-mandated access ramps wherever there are stairs and no lifts. Of course, doors could be widened and products on shelves made more accessible. These advocates, as I will call those who wish to alter the status quo, perceive that if these aspirations were packaged into a law and proposed in one fell swoop--in dramatic rather than incremental fashion--then they would be defeated. The loss would occur because of the combined resistance of owners, especially those who could be...