The Heritage Foundation
REPORT Political Process
From Administrative State to Constitutional Government
Joseph Postell
2017-18 Visiting Fellow in American Political Thought
Over the past 100 years, our government has been transformed from a limited, constitutional, federal republic to a centralized administrative state that for the most part exists outside the structure of the Constitution and wields nearly unlimited power.
This administrative state has been constructed because of a massive expansion of the national government’s power.
When the Founders created our Constitution, they entrusted only limited powers to the national government and specifically enumerated those powers in the Constitution itself.
A government that only had to carry out a limited number of functions could do so through the institutions and procedures established by the Constitution.
But as the national government expanded and began to focus more and more on every aspect of citizens’ lives, the need for a new kind of government—one focused on regulating the numerous activities of citizens rather than on protecting their individual rights—became apparent.
In the United States, this new form of government is the administrative state. In Democracy in America , Alexis de Tocqueville warned that under such a government, citizens would become“nothing more than a herd of timid and industrious animals, of which the government is the shepherd.” [1]
As the modern administrative state has grown and metastasized over the past decades, it has taken many forms, to the point of becoming the primary method of politics and policymaking.
The myriad agencies and departments that make up this administrative state operate as a“fourth branch” of government that typically combines the powers of the other three and makes policy with little regard for the rights and views of citizens.
In terms of actual policy, most of the action is located in administrative agencies and departments, not in the Congress and the President as is commonly thought. Unelected bureaucrats—not elected representatives—are running the show.
One of the greatest long-term challenges facing the United States is the restoration of limited constitutional government. Central to that objective, and an essential aspect of changing America’s course, is the dismantling of the administrative state that so threatens our self-governing republic. [2]
The Constitution vs. the Administrative State
Central to the idea of American constitutionalism are the concepts of representation, the rule of law, and the separation of powers. The administrative state does damage to all of these principles. A few examples demonstrate how these principles are violated by the administrative state.
We often think that the laws of this country are passed by Congress. Since Members of Congress are elected by the people, we assume that we have therefore indirectly consented to the laws that we must follow.
The reality is much different. Most federal law is created by the agencies and departments that make up the national bureaucracy, not by Congress.
Congress passes laws delegating its legislative power to these agencies and departments, and they in turn develop the laws with which we must comply.
When Nancy Pelosi famously declared that we would have to pass the Patient Protection and Affordable Care Act (popularly known as “Obamacare”) so that we could find out what is in it, she was not referring to the length of the bill.
Rather, she was referring to the fact that most of the laws—such as the infamous Health and Human Services (HHS) requirement that all insurance providers cover contraception, abortion drugs (day after pills), and sterilization—would be made by HHS, not found in the statute that Congress was passing.
Similarly, in March 2011, the Environmental Protection Agency (EPA) announced that the Clean Air Act suddenly allowed it to regulate mercury emissions from coal plants.
The EPA announced that the rule would cost $10.9 billion annually over the next 10 years so that older plants could be retrofitted for the new technology.
In announcing the rule, the EPA acknowledged that many coal plants would have to be shut down, and several power companies testified that the rule would result in rolling blackouts and unreliable energy supply. [3]
Why is an agency run by unelected officials making such massive decisions affecting the U.S. economy? And why is it doing this under a mandate, created decades ago, that was designed to deal with a completely different problem?
This is fundamentally contrary to the idea of republican government and the principle that all laws must be passed by our elected representatives.
The administrative state also undermines the rule of law. Bureaucrats regularly make exemptions to the regulations that they create. By its own count, HHS has granted over 1,700 waivers from its own regulations under Obamacare. [4]
Bureaucrats therefore write the laws and, because they execute them, are also able to exempt politically powerful groups and industries from those same laws. This violates the idea that we are all to be treated equally under the law, rich and poor, powerful, and weak alike.
Finally, the administrative state violates the principle of the separation of powers by breaking down the divisions between the constitutional branches of government.
Power is transferred from Congress to agencies and departments, which are then influenced by all three branches of government but not directly accountable to any, and the effect of checks and balances is reversed.
All of the branches work together to control the unwieldy administrative apparatus that often combines all three powers of government—legislative, executive, and judicial.
The National Labor Relations Board is a perfect example of this combination of powers. In its infamous decision to sue to block airline manufacturer Boeing from moving some of its facilities to South Carolina, which is a “right to work” state, the NLRB acted as lawmaker, investigator, prosecutor, judge, jury, and executioner.
This is clear from the facts of the decision. The machinist’s union notified the NLRB that Boeing was moving some of its production to South Carolina from Washington State, and this prompted the NLRB’s lawsuit.
In specific cases where an employee alleges that an employer is engaging in “unfair labor practices” (a vague phrase that is defined, of course, by NLRB rules), the employee’s allegation is typically resolved in a hearing before an NLRB administrative law judge.
These administrative law judges issue decisions on behalf of the agency. Employers who receive an adverse decision by the NLRB’s administrative law judge can appeal to…the NLRB. [5]
The NLRB itself decides several hundred cases per year, and only about 65 of those cases are appealed to an independent court. While the circuit courts are called upon to review the NRLB’s orders, the agency boasts on its website that “The majority [of cases]—nearly 80%—are decided in the Board’s favor.” [6]
The NLRB, in short, makes rules governing employer–labor relations, investigates violations of the rules that it issues, decides particular cases involving employers and employees, and enforces the decisions that it orders. This combination of legislative, executive, and judicial power inevitably causes objectionable bureaucratic decisions. When we create institutions that violate our basic constitutional principles, we lay the groundwork for tyrannical decisions.
The problem, in other words, is not necessarily the specific people running the NLRB. The agency was set up to act in a dysfunctional manner.
In sum, the administrative state centralizes power in Washington and then consolidates that power in the hands of agencies and departments that violate republican government, the rule of law, and the separation of powers.
As a result, citizens find themselves at the mercy of government agencies and departments over which they have no control. With the removal of these controls, bureaucrats often overreach and cause profound damage with little accountability or public awareness.
Examples of bureaucrats gone wild abound. For example, the U.S. Fish and Wildlife Service (FWS), in pursuance of the lawmaking powers delegated to it by the Endangered Species Act (ESA), is authorized to list a species as either “threatened” or “endangered.” The agency also designates “critical habitat” for all listed species.
Anyone affecting the habitat of a threatened or endangered species in any way is subject to substantial fines and even criminal charges.
Once a species is listed, in other words, FWS bureaucrats assume control over the use of all private property in the area where the threatened species lives.
In New Jersey, a 77-year-old woman “was prohibited from building a home on land she had bought for her retirement because the FWS ruled that there was a federally protected plan species ‘within five miles of the proposed project site.’” [7]
Under the broad powers delegated to it by the ESA (endangered species act), the FWS has delayed the building of schools and hospitals, dictated to landowners how their land is to be used, and generally prohibited development when any listed species may be affected in any way.
For example, after “negotiations” between the FWS and biologist consultants hired by the Napa Valley Unified School District in California, the district was required to purchase 317 acres of vacant open space at a price of $4.6 million to mitigate risks to the California Red-Legged Frog. [8]
To save the same frog, the city of San Francisco proposed a series of projects to preserve a public golf course (the Sharp Park Golf Course) that would cost from $6 million to $10 million by relocating Red-Legged Frog egg masses to safer areas under the supervision of FWS authorities.
However, environmental groups are using the ESA to sue the city of San Francisco, saying that these relocation measures are insufficient and that nothing short of shutting down the course is acceptable. [9] The California Red-Legged Frog and the California Tiger Salamander have caused similar problems for the Northern California wine industry. [10]
In each of these cases, the rights of citizens were threatened by administrative agencies that have been given the power to make laws; investigate, prosecute, and enforce laws; and even in many cases to judge violations of their laws.
In fact, most of the “laws” of this country are made, executed, and applied by administrative agencies and departments. They operate under the radar, largely insulated from the control of the people. They often combine the powers of government, and their personnel are primarily unelected.
This is the predominant feature of our new form of government, the administrative state, and it’s where the action is.
When our elected representatives (Congress) fail to enact policies because of popular opposition, they know that the institutions of the administrative state can carry these very policies out without resistance, using the powers delegated to them by Congress.
Elections do not matter very much if agencies can make policy without the support of our elected representatives. Yet today, whether or not Congress makes law, administrative agencies and departments already have the power to make new rules, rendering the concept of representation irrelevant.
A little history….
The administrative state was not created all at once in America. Its roots go back to the late 19th century, when changes in the American economy spurred by the Industrial Revolution created a political crisis.
Starting in the 1870s, farmers in Western and Midwestern states began to clamor for government intervention to control railroads, which farmers used to ship crops to markets; banks, which loaned money to farmers for land and equipment; and other powerful economic entities.
This “Granger” (farmer/homesteader) movement took hold in many states, and railroad commissions were created at the state level to dictate rates at which railroads could haul goods to markets.
In response to these concerns, the first federal administrative agency—the Interstate Commerce Commission (ICC)—was created in 1887.
But the Grangers were wary of entrusting bureaucrats in centralized agencies with too much power. They were fearful of bureaucracy as much as they were fearful of powerful economic interests.
Thus, the ICC’s power was carefully limited. In the same spirit, the Sherman Anti-Trust Act of 1890, which was intended to break up powerful economic combinations called “trusts,” did not create a federal bureaucracy.
From 1887–1900, the federal government tried to regulate the new industrial economy without enacting full-scale bureaucracies, but the precedent of the ICC would be used by a new group of reformers, called the Progressives, to create the first batch of federal programs and agencies that would become the administrative state.
The Progressives were led by reformers such as Theodore Roosevelt; Woodrow Wilson; Herbert Croly, co-founder of The New Republic and author of The Promise of American Life ; and Frank Goodnow, a prominent professor of public administration who taught at Columbia University and was later president of Johns Hopkins University.
Like the Grangers, these Progressives aimed to expand national power, but their ends were very different from those of the Grangers. Many of them were educated in 19th century German philosophy, particularly Hegelian idealism. (Government evolves, thesis, antithesis, and synthesis) The Progressives were heavily influenced by this new philosophy of government and sought to implement that new philosophy in America.
In a nutshell, these American Progressives applied the political philosophy of Hegelian idealism to mean the following:
- Individuals do not possess natural rights; rights and liberty are granted by government.
- The purpose of rights is not to promote the pursuit of individual happiness, but to allow individuals to dedicate themselves to the collective good of the whole society.
- For government to assist in achieving this dedication to the collective good, it had to be centralized at the national level, expanded dramatically, and involved in regulating most (if not all) of the economic and social decisions made by citizens.
- In order to administer this dramatically expanded government, federalism, limited government, and the separation of powers had to be scrapped in favor of rule by enlightened, intelligent experts located in administrative agencies.
These Progressive reformers seized upon the public’s desire for regulation and enacted laws creating new bureaucracies and strengthening the ICC.
In 1906, Theodore Roosevelt used his“bully pulpit” to force Congress to pass the Hepburn Act, which dramatically expanded the ICC’s power to set railroad rates and regulate the railroads.
After Woodrow Wilson’s important victory in the 1912 presidential election, the wave of Progressive reform became a tsunami.
The Federal Reserve Act, creating the Federal Reserve System, was passed late in 1913, and the Clayton Anti-Trust Act was passed in 1914, strengthening the antitrust powers held by the Federal Trade Commission, which had been created that same year.
The FTC was empowered to eliminate “unfair competition,” an open-ended phrase defined, of course, by the FTC commissioners. These commissioners, furthermore, would be appointed by the President upon confirmation by the Senate, but they could not be removed by him except in extreme cases of wrongdoing or incompetence. The same was true of the commissioners of the ICC.
Other major bureaucracies were created during the Progressive Era as well. In addition to the ICC, the FTC, and the Federal Reserve, the Food and Drug Administration was created in 1906 by the Pure Food and Drug Act, and the Federal Radio Commission (precursor to the Federal Communications Commission) and Federal Power Commission were created in 1927 and 1930, respectively.
The first wave of the creation of the administrative state established new and unprecedented principles about how government should work. These agencies had broad delegations of authority that gave them the power to make law, not simply execute it.
The Federal Communications Act of 1934, for example, created the Federal Communications Commission and directed it to grant broadcast licenses to applicants “if public convenience, interest, or necessity will be served thereby.”
Additionally, the heads of these agencies would not be accountable to the President, which meant that they existed as a “fourth branch” of government, not directly accountable to any of the three constitutional branches.
This new administrative state was expanded in two later periods in American history: the New Deal of the 1930s and the regulatory explosion of the 1960s and 1970s.
In the New Deal, the administrative state created by the Progressives was expanded massively. Huge new agencies such as the Securities and Exchange Commission, the National Labor Relations Board, and the Federal Communications Commission were created during Franklin Roosevelt’s presidency.
The Great Society went even further, establishing agencies with broad authority to regulate the environment (the Environmental Protection Agency); consumer products (the Consumer Product Safety Commission); highway safety (the National Highway Traffic Safety Administration); and workplace safety (the Occupational Safety and Health Administration).
In addition, although the Great Society is associated with Lyndon Johnson, Richard Nixon also contributed significantly to the expansion of government and bureaucracy during his tenure in office (1969–1974).
President Nixon instituted wage and price controls in 1971 and 1973, showing that he was no believer in limited government or economic freedom. He also supported the Clean Air Act and created the Environmental Protection Agency as well as the Occupational Safety and Health Administration. With the creation of EPA and OSHA under his watch, Nixon ranks as one of the greatest expanders of bureaucracy in American history.
So, what can be done? Three simple solutions.
- Provide a period of time before agency rules become effective, during which time Congress can strike them down, or
- Do not allow agency rules to become effective unless Congress affirmatively approves them.
- Hold Congress accountable to do their jobs. If they don’t, vote them out.