Politics Without Romance: Implications of Public Choice Theory for Statutory Interpretation

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1 Yale L aw Sc hool hool L hol ars hi p R eposit ory Yale L egal Sc aw Sc Yale L Faculty Scholarship S l Faculty Scholarship eries aw Schoo 1988 Politics Without R omance: I mplic ations of Public Choice Theor y for S tatutory Interpretation idge Jr. William N. Eskr aw Sc hool Yale L https://d igitalcommon s.law.yale.edu/f Follow thi s and additional works at: ss_papers Part of the Law Common s Recomme nded Citation omance: Implications of P tatutory Interpretation" (1988). ory for S ublic Choice The . Jr., "Politics Without R idge, William N Eskr Faculty Sc holarship Ser ies . 3824. igitalcommon https://d ss_papers/3824 s.law.yale.edu/f l Faculty Scholarship a n access by the Y s brought to you for f ree and ope ale L aw Schoo This Article i ory. It eposit l Legal Scholarship R aw Schoo t Yale L ized admini eries by an author ale L en accepted for inclusion in F has be aw Schoo l Legal Scholarship R eposit ory. For strator of Y aculty Scholarship S . .edu [email protected] lease contact mation, p more infor

2 POLITICS WITHOUT IMPLICATIONS OF ROMANCE: PUBLIC CHOICE THEORY STATUTORY FOR INTERPRETATION William Eskridge, N. Jr.* N IMPORTANT A QUESTION of and positive normative legis- lation theory is what courts role should assume they when in- terpret statutes (as opposed to the Constitution and common the One law). can imagine the range of roles as a continuum. At one an pole is "archeological approach," in which a court's role is to unearth enforce and the original expectations intent or the of legis- lature that created statute. the Under this approach, statutory in- terpretation is an effort to discern original the answer put into the statute. At the other pole is a "free inquiry approach," in which the court's role is to reach the result, best formally unconstrained (though perhaps influenced persuaded) or by the statute's and text legislative history. These two poles different represent aspirations for statutory interpretation. The archeological approach appeals to formal legitimacy (the nonelected judge not exercising is any dis- cretion but is merely out carrying the will of the majoritarian legis- lature), while the inquiry free appeals approach to functional legit- 1 imacy (justice or good results). Traditional theories of statutory interpretation take something close an to archeological approach, though without admitting that 2 results good thereby are sacrificed. Traditional theorists accom- plish this by feat assuming (with varying degrees of explicitness) a * Visiting Associate Professor of Law, Georgetown University Law Center. grateful I am generous for and constructive comments a on draft previous James from Buchanan, Ronald Daniel Cass, Philip Farber, Frickey, Vicki Jackson, Jonathan Macey, Jerry Mashaw, Posner, Richard Edward Rubin, and Warren Schwartz. Any errors and omis- are sions own fault. (I my thank Professor also Buchanan permitting for me to use as part of the title to this Article a he has phrase sum used to the public up choice vision of politics.) I The archeological metaphor used in this paragraph was suggested to me Professor by T. Alexander Aleinikoff. The free inquiry metaphor taken from is Geny, M6thode F. d'Interpr~tation et Sources en Droit Priv6 Positif (1899). 2 See Dickerson, R. The Interpretation and Application of Statutes 87-102 (1975) (focus- ing on legislative purpose); H. Hart & A. Sacks, The Legal Process: Basic Problems in the Making and Application of Law 1201 (tent. ed. 1958) (statutory interpretation should be a HeinOnline -- 74 Va. L. Rev. 275 1988

3 Virginia Law Review 74:275 [Vol. politics, vision be traced back to the which romanticized of can political of thought Madison. James "Optimistic pluralists" posit the that legislature, filled with reasonable people acting reasona- bly, will tend to public-seeking pass so laws, as the legislators long the follow deliberative procedures required by the Constitution. viewpoint This the framed context within which post-World War II legal scholars thought about statutory interpretation. Optimistic pluralism offers most appealing a vision, because it suggests that typically there is tension no between effect giving the expecta- to 3 tions of Congress accomplishing and good policy. This of legislation vision has fallen under sustained and persua- criticism sive the in last three decades, Public however. the- choice ory, which analyzes political the process using principles of eco- nomics, posits very a different vision legislation. of Professor James Buchanan "politics it calls without and romance" suggests that "[p]ublic choice theory has the become avenue through which a romantic illusory and notions of set the about workings of gov- ernments" been has replaced with more realistic notions." As pub- choice lic has theory deromanticized the political process, legal scholars have reexamined traditional the statutory interpretation that theory rested on the now-questioned political assumptions. Important contributions have been made Judge Richard by Pos- 5 6 Judge ner, Easterbrook, Frank Daniel Professors Farber and "calculus to serve the ultimate purposes" of the law); 2A Sutherland Statutory Construction § 45.05, at 20-21 (4th ed. 1984) legislature). of (intent 3 This idea explored is in more detail in Part I, infra pp. 280-83, and in Eskridge & Legislation Frickey, Scholarship Pedagogy in and Post-Legal the Process U. Era, 48 Pitt. L. Rev. 694-99 691, (1987). ' Buchanan, Politics Without Romance: A Sketch of Positive Public Choice Theory and Normative Its Implications, in Theory The of Public Choice-I, at 11 (J. Buchanan & R. Tollison eds. 1984). Posner, See 5 R. Courts Federal The Posner, 286-93 (1985); Economics, and Politics, the Reading and of Statutes the Constitution, Chi. L. 49 Rev. U. [hereinafter (1982) 263 Posner, Economics, Politics]; Interpretation-in Statutory Posner, the Classroom and in the Court- Chi. room, 50 U. (1983) L. Rev. 800 Posner, [hereinafter Statutory Interpretation]; Posner, Formalism, Legal Realism Legal the Interpretation and and of Statutes 37 Constitution, the Case L. Res. Rev. W. 179 (1986-87) [hereinafter Formalism]. Posner, Legal 6 See Easterbrook, Statutes' U. Chi. 50 Domains, L. Rev. 533 (1983); Easterbrook, The Supreme Court, 1983 Term-Foreword: The the and Court Economic System, 98 Harv. L. Rev. (1984) [hereinafter 4 Easterbrook, Foreword]. HeinOnline -- 74 Va. L. Rev. 276 1988

4 Statutory Interpretation 1988] 7 Frickey, Jonathan Macey," each of whom has and Philip Professor theory of interpretation tied at least a suggested general statutory such theory. Other scholars, choice insights public of the part to in 9 as Justice have Scalia, Antonin used choice arguments public to illuminate specific such as the issues, proper his- of use legislative interpretation. tory in statutory choice public affect the doctrine and practice How might theory Probably main impact of public interpretation? of statutory the negative: its descriptive vision of the legislative choice theory is wedge a the aspirations of traditional statu- process drives between policy) and its legitimizing methodol- interpretation tory (rational legislative ogy or purpose). Part I of this Article (original intent this impact. Public choice theory indicates that explores negative will the few laws that serve truly public produce legislature too many This that serve private ends. too is a Madiso- ends, and laws a public theory is correct, choice court that nightmare. nian If enforce the original "deal" embodied in a statute could sought to to only nightmare. Although a positive (descriptive) contribute the choice has at least one normative implication: public thus theory, of politics undermines our faith in the its ap- vision archeological to interpretation, as it traditionally has statutory ar- proach been and defended. ticulated public choice theory tell us anything more affirmative Does statutory about issue is explored in Parts II interpretation? This of this In my view, public choice theory does not and III Article. theory interpretation, statutory general but does support any of useful of inquiry. Although public choice theory some suggest lines the operation and dysfunctions of legislatures and has explored public literature the on the operation of courts is agencies, choice To focuses judicial common law making. on meager and mainly meaningfully contribute theories to legal interpreta- statutory of See 7 Farber & Frickey, Legislative Intent and Public Choice, 74 Va. L. Rev. 423 (1988). See Macey, Promoting Public-Regarding Legislation Through Statutory Interpretation: 8 Interest An 86 Colum. L. Rev. 223 (1986) [hereinafter Macey, Public-Regard- Group Model, Macey, the Costs and the Normative Elements of Legislation]; Public ing Transaction An Model: Choice Application Theory, 74 to Constitutional Rev. L. (1988) [herein- Va. 471 after Macey, Constitutional Ordering]. See, e.g., Hirschey v. Federal Energy Regulatory Comm'n, 777 F.2d 1, 7-8 & n.1 (D.C. I a 1985) concurring) (committee reports offer only J., very uncertain reflection of (Scalia, Cir. true intent of legislators); see also Farber & Frickey, supra note 7 (analyzing public the and themes the opinions of Justice Scalia in other recently appointed judges). choice HeinOnline -- 74 Va. L. Rev. 277 1988

5 278 Virginia Law Review 74:275 [Vol. tion, public choice would to have provide us insights with about comparative the competence of courts make to law, or to supple- or ment correct the law by made Congress the and agencies. Although the existing public choice literature on legal theory does offer not full a theory comparative of competence, germ the of such a theory may nevertheless discernible. be Part posits II three hypotheses and tests them against public choice arguments. The hypotheses are: the pure archeological approach statutory to inter- pretation, an intermediate dynamic approach, and free the inquiry approach. Three of public lines choice inquiry are used to test those hypotheses: Which hypothesis best reflects the comparative institutional competence of Congress, agencies, and courts make to legal rules? What would be the effects of each approach on politi- actors, cal including interest groups and Congress? Under which approach does our political system work "best"? At this point, public choice theory affords no us definitive answers to these three inquiries. On the whole, though, the theory does tentative offer support for the intermediate hypothesis-for dynamic interpreta- 10 tion-and suggests that the archeological hypothesis be rejected. This conclusion runs against the assumed wisdom about the impli- cations public of choice theory statutory for interpretation. Public choice theory, however, suffers from more a serious limi- tation its on usefulness in legal discussions statutory of interpreta- That tion. limitation derives from the controversial nature of the theory itself. Critics argue that public choice theory's conclusions are indeterminate and incomplete and-worse even-that the the- ory's conclusions undermine our sense of political community. In Part III, assume I critics the right. are Does public theory choice nevertheless offer useful insights for statutory interpreters uncom- fortable with or skeptical of theory? the argue I that does. it To begin by with, envisioning legislative politics at worst, its public choice alerts judges occasions to when legislative the process has likely most been misdirected; the theory, moreover, suggests the which ways in the legislative process likely has miscarried. Miscar- riage least is where likely statute a establishes "symmetrical" obli- gations and benefits the (i.e., groups benefiting from law a are of 10 For my earlier development "dynamic of statutory interpretation" literary from and historiographical theory, see Eskridge, Dynamic Statutory Interpretation, 135 U. Pa. L. Rev. 1479 (1987). HeinOnline -- 74 Va. L. Rev. 278 1988

6 279 Statutory Interpretation 1988] size comparable those to and clout political upon law the whom costs), for imposes in political the instances those has process worked probably well as it as Statutes can. balanced with evenly unfortunately benefits, seldom updated costs and however, are too legislature. the by courts Hence, ought to consider adopting a broad interpretive strategy towards these "symmetrical" statutes, time over them updating circumstances. meet to changed the On a where establishes "asymmetrical" obligations hand, other statute beneficiaries and the law have either more or benefits (i.e., the of than clout political less the cost payers), there is of a danger legis- administrative which a court might deal with lative or dysfunction, a through public-seeking or narrow interpretation statute. the of More public importantly, choice to attention calls theory dy- the and thereby emphasizes namic consequences nature of statutes the of different interpretations or interpretational po- The strategies. incentives litical and structures identified theory by public choice and deleterious ways for statutes to evolve; ju- suggest both useful encourage useful ways and discourage can dicial interpreters the the least in deleterious ways, at example, For some cases. regula- enforcing agencies tory asymmetrical statutes that, for in- (statutes stance, protect at benefits public the more a of concen- expense trated tend group) regulated regulated to by be the influenced degree interest group influence varies, The time. over interests of thwart but it tends to the of original, stated goals the statute. Knowing courts developed have this, for monitoring strategies agency and enforcement agency correcting missteps. most Perhaps the public of lesson important theory for choice statutory interpretation that is deepens our it understanding the of court is often court-legislature to finesse a dialogue. A tempted choice "leaving it to the legislature." by hard interpretational This the worst frequently is leave the choice. place to that, doing Before to the ought consider court the legislature's incentives act (and to to act constructively) or example, the to act. not For might court "losers" of the interpretational lawsuit will consider the whether access the legislature to seek to Public have effective clarification. choice rules of thumb theory's rough interest predicting for group formation legislative deliberation and in response to controversial judicial interpretations should be to judges encourage more selec- leaving it only to the legislature or agencies to carry on tive about dialogue instinct in statutes. policy the HeinOnline -- 74 Va. L. Rev. 279 1988

7 280 Virginia Law Review [Vol. 74:275 PUBLIC I. CHOICE THEORY MADISONIAN A AS NIGHTMARE James Madison's on essays "factions" and the desirability of representative government in the Federalist" The have been the point starting for much political American theory. Self-interested factions are inevitable, and Madison believed government that must structured be to minimize their influence. Madison Although 1 2 believed self-government in by "the body great people, of the he opposed direct democracy because feared he factions that would dominate and displace permanent "the and aggregate interests of s 13 the community. Decision by direct vote of the people might re- flect nothing than more temporary majorities, formed out of in- flamed passions transient or coalitions. Madison argued a that bet- ter to way effectuate "[t]he of regulation various these and 1 4 interfering interests" was representative government. "[T]he public voice, pronounced by the representatives of the people, will be more consonant to the public good than if pronounced by the 5 purpose.' the for convened themselves, people Madison believed that structural features legislature of the would prevent the representatives themselves from domi- being nated by factions. a As republic, large the United States would have many representatives, each having a broad constituency. This would protect many representatives against being captured any by one faction. More important protections, moreover, would come from bicameralism the executive and veto. Bicameralism would not only provide double a review of proposed legislation, also but 6 would assure two distinct perspectives. The House of Representa- tives, with members from smaller districts and subject to electoral " relevant For commentary The Federalist, on D. see, e.g., Epstein, The Political Theory of The Federalist (1984); Ackerman, Storrs Lectures: The Discovering the Constitution, 93 Yale L.J. (1984); 1013 Sunstein, Groups Interest American in Public Law, 38 Stan. Rev. L. (1985). 29 2 The Federalist No. 39, at 240 (J. Madison) (C. Rossiter ed. 1961). 13 Federalist The 10, No. (J. Madison) at 78 Rossiter (C. ed. 1961). 14 Id. at 79. Id. at 82. 5 The Federalist 16 No. 51 (J. "In Madison). republican government," noted Madison, "the legislative necessarily authority The predominates. remedy for this inconveniency is to di- vide the legislature into different branches; to and render them, by different modes of elec- tion and different principles of action, as little connected with each other as the of nature their common functions and their common dependence on the society will admit." Id. at 322 (C. Rossiter ed. 1961). HeinOnline -- 74 Va. L. Rev. 280 1988

8 Statutory 1988] Interpretation scrutiny two every years, would an "immediate have dependence 17 on, intimate and an sympathy with, the The people." Senate, whose members originally were elected state by legislatures for six- year terms, would have greater leisure to acquaint themselves with 1 8 the issues and discuss them deliberatively. Finally, the Presi- dent's veto would power give official the with the largest constitu- ency power the to block factional legislation even it got if through 9 both chambers Congress." of The genius Madison's of thought in lay reconciliation its our of potentially antipodal desires for legitimate both majoritarian gov- ernment rational and public-seeking government. The former was assured by vesting policymaking authority the popularly in elected legislature. The latter abetted was by a constitutional framework assuring deliberative lawmaking and checking factional domina- tion. Madison's ideas had have continuing a influence in American political thought. After World II, War prevailing the political the- 0 ory optimistic an was pluralism tied to Madison's ideas. Although the pluralists the of 1950's accepted interest group domination of government, they were optimistic that the role interest of groups would not result in mere shifting, temporary majorities. Groups, it hoped, was would emerge on all sides of each and issue the protec- tive procedures of lawmaking (bicameralism, veto, the committee review) ensure would rational accommodation of interest group needs. The most influential work statutory on interpretation the in 1950's was the legal process materials Professors of Henry Hart 2 and Albert Sacks. 1 Their approach brilliant was a application of Madison's reconciliation-updated-to modern statutory interpre- tation. While occasionally acknowledging most that statutes are 2 2 passed in response interest to group pressure, Hart Sacks and The " No. Federalist 52, at 327 (J. (C. Madison) 1961). ed. Rossiter " The Federalist No. 62 (J. Madison); The see Federalist (A. 71 No. Hamilton). " The Federalist (J. No. 51 Madison). Professor 20 Theodore Lowi calls this "interest-group liberalism." T. Lowi, The End of Liberalism ed. 51 (2d Examples 1979). of optimistic pluralists are W. Binkley Moos, & M. A Grammar of American Politics Dahl, (1949); R. A Preface to Democratic Theory D. (1956); The Truman, Governmental Process (1951). All of these political philosophers start with Madison, and Dahl's is an extended book analysis of Madisonian theory. 21 H. Hart & Sacks, A. supra note 2. For a more elaborate analysis of Hart and Sacks' political theory, see Eskridge & Frickey, supra 3, note at 694-99. 22 See, e.g., H. & A. Hart supra Sacks, note 2, at 829. HeinOnline -- 74 Va. L. Rev. 281 1988

9 [Vol. 74:275 Virginia Law Review posited that the legislative process would work well long so as proper procedures were followed. In their ideal, legislative proce- dure would an be "informed process" (decisions would be made only a after thorough factual context had been established) a and "deliberative process" (legislators and experts would publicly dis- 2 the cuss consequences various of policy alternatives). " Hart and Sacks' belief that "the best criterion sound of legislation is the test 2 ' 4 of whether it is the product a sound of process enactment" of was similar to Madison's idea that procedural structures can ensure de- liberation and check factions. The result of deliberative this process, argued and Hart Sacks, 2 5 would rational, be purposive statutory law. This would render the Madisonian reconciliation applicable statutory to interpretation: once was it established that the legislature had made rational pol- icy, the of role courts interpreting statutes would carry be to forth that rational process to hard questions not specifically addressed the by statutory language. Hart and Sacks could have moved then either in two of directions. most Like prior scholarship statu- on tory interpretation, could they have emphasized legislative intent. The public statements of legislators committee (in reports and on the floor the of legislature) clues are the to rational consensus pro- 26 process. deliberative the in duced The preferred methodological approach for Hart and Sacks, however, was that one promised more creativity the for interpreter. Because "every statute . . has . some kind of purpose objec- or tive," Hart and Sacks argued that ambiguities could be resolved, first, by identifying that (presumably) rational purpose and, then, by deducing the result most consonant with that purpose. As a surrogate for legislative intent, legislative purpose seemed majoritarian, but as a more flexible concept it enabled judges to expand rational the policies the of statute into new situations, un- foreseen the at time of the statute's passage. 23 Id. at 715-16. 24 Id. at 715. at 25 Id. 1156-57. statute "Every must conclusively be presumed to a be purposive act. The idea of statute a without an intelligible purpose foreign is the to idea of law and inad- missible," the archly materials observe. Id. at 1156. 21 Indeed, much of the Hart and Sacks materials is a sophisticated introduction to the use legislative of history to uncover the presumedly rational legislative intent. 17 H. Hart & A. Sacks, supra note at 2, 166-67. Hart and Sacks posited that a statutory interpreter must assume "that legislature the was made up of reasonable persons pursuing reasonable purposes reasonably." Id. at 1415. HeinOnline -- 74 Va. L. Rev. 282 1988

10 Statutory Interpretation 1988] long So as political subscribed theory something to like the opti- mistic pluralism the of 1950's avoided (or the issue), reconciliation of majoritarianism and rational policy was safe. the Since 1950's, however, optimistic pluralism has substantially been discredited, in large part through descriptive the contribution of public choice theory. Public choice theory indicts this highly romantic vision of 28 the political process on three counts. First, decisionmaking by majority rule yields arbitrary and discriminatory results. Second, interest groups skew public decisionmaking toward private rent- seeking and away from public interest statutes. Third, the proceduralism of Madison, and Hart Sacks, and provides scant protection against the of ills rent-seeking government. The gritty realism of public choice exposes both the incoherence of the Madisonian reconciliation and political the mythology underlying and Hart Sacks' theory of statutory interpretation. A. Arbitrariness The of Majority Rule One branch of public choice theory examines legislation and vot- ing a as game which in rational behavior the by game players yields unhappy results for the group as a whole. Consider a three- person legislature that does nothing but allocate tax money to build roads, with one project being voted on each year. Legislator A wants new a road for her district (Decision Legislator 1). B wants to repair a road in his district and invest the surplus funds (Decision 2) or, failing that, to build A's road, which pass will through B's district. Legislator C, whose district has good roads, wants to invest all money the (Decision What 3). will the legisla- ture do with the money, under majority voting rules? answer The is indeterminate, for the three decisions form "ma- a jority cycle." A pairwise vote on Decision 1 versus Decision would 2 yield Decision 2 (B and in C majority). the A vote Decision on 2 versus Decision 3 would yield Decision 3 (A and C in majority). the Yet a vote on Decision 3 (the winner 2 in versus against 3) Deci- sion 1 (the loser in 1 versus would 2) yield Decision 1 (A and in B There 21 are different two types of public choice analysis. Social choice theory focuses on how decisions are made under various social rules. Interest theory group focuses on the incidence and influence of interest groups. This Article draws of its most analysis from the latter. HeinOnline -- 74 Va. L. Rev. 283 1988

11 Virginia Law Review [Vol. 74:275 other majority)! on the order of pairwise the words, In depending of any voting, can decisions adopted. the be Duncan Professors Black and Kenneth argued Arrow majority that cycling is the typi- 2 9 cal phenomenon choices complex when Majority made. be must cycling at least, that suggests, results achieved under "democratic" rules voting are that arbitrary. The fact mere Decision I is adopted mean may nothing more than that Legislator the A controls 30 agenda the chair (e.g., holds proceedings). the during gets worse. It Expand the hypothetical the potential to consider social from majority voting, loss Buchanan James as Professors and Gordon classic their Tullock did in Con- work The of Calculus 31 sent. Assume that Legislator so that controls A agenda, the Deci- the last sion 1 is winning to pair up, against addi- 3. Decision In tion, assume the social that the benefit (55% 100 of Decision 1 is which of accrues to District A and and District to 45% B) that the social benefit of Decision is 3 120 (shared equally by the three Dis- tricts). Obviously, from the collective of view, point best the deci- is Decision sion 3 (no projects this year), yet a coalition of and A B will This is Decision for vote 1. C to not (which only unfair gets no even though benefit is but taxes), it pays collectively wasteful as tune (to 20).2 well the of A significant theory game lesson from the Buchanan and Tullock importance is study the of symmetrical costs and sim- benefits. In games, voting ple there tendency strong a toward is waste social See 2 Individual K. Arrow, Choice and Social Black, D. Values (2d ed. 1963); Theo- The Committees ries of W. (1958); Elections and Riker, Liberalism against Populism (1982); A. Social Collective Sen, Choice and Welfare (1970); McKelvey, Intransitivities Multidimen- in Voting Models and sional Control, Some Implications for Agenda 472 Theory Econ. J. 12 (1976); cf. Niemi, Majority Decision-Making Unidimensionality, with Partial 63 Pol. Am. Rev. 488, Sci. are decisions (social (1969) possible 494-95 through voting majority simple if necessarily all-voters most-not preferences their array uniform criteria). along or group 20 The person might controlling the agenda also the pro- to arbitrary be subject cess of cycling. The See K. Shepsle, (1978). Puzzle Jigsaw Giant 31 J. Buchanan Tullock, The & G. Consent of Calculus 131-69 (1962); see Tullock, Problems 67 of Majority Voting, Pol. Econ. 571 (1959). J. Tullock "2 As Buchanan and this can be of dynamics the note, side changed by allowing payments avoid closed (logrolling). To being can to B up to 40 C out entirely, offer persuade change its vote to Decision 3. B to an important caveat to the horrible This is de- results scribed but in text, the and Tullock Buchanan demonstrate also that with even pay- side coalitions ments, winning will often form for decisions in which collective gains will the total than less (or be total expenditures gains another decision). potential the of Buchanan See J. Tullock, supra note 31, at 155-57. G. & HeinOnline -- 74 Va. L. Rev. 284 1988

12 Statutory Interpretation 1988] when and costs benefits are when asymmetrical-as a political a on in my hypothetical) in decision costs minority (C concentrates 3 order distributed widely give to more (to A and benefits B). Such 3 when costs and less are symmetrical-as waste is likely benefits decision distributes both benefits and costs when the political population broadly concentrates benefits and costs across the or 4 3 narrowly. very Group Market for The B. Dysfunctional Interest Legislation public Subsequent broadened choice scholarship has the lessons group analyzing the dynamics of interest theory gov- game by of choice Public ernment. treat theorists typically an legislation as in transaction groups form the demand which economic interest 5 side, form and the legislators whole, supply the On side. this branch of public choice theory demonstrates for the that market legislation badly functioning is a one. market That is, the system- too few laws that atically "public goods" (i.e., laws yields provide contribute the overall efficiency of society by providing a that to that probably not arise from individuals benefit collective would And it acting separately). too many systematically yields that laws are "rent-seeking" that distribute (i.e., laws resources a desig- to group without nated contribution any to society's overall efficiency). demand The determined is legislation for the incidence by and activity interest of groups. The optimistic pluralists that believed groups interest response to form would in in true disturbances the environment social hence, and, would normally press legitimate would bring grievances variety of socioeconomic perspectives and a 3 6 debates. the political Public choice theory sug- into subsequent 33 See id. at 164-67. 31 See id. at 167-68. Some 35 scholars, however, analyze the transaction as one in which one interest group benefits at the expense of other groups or society as a whole; legislators are treated obtains brokers as who or transfer. effectuate agents the McCormick R. Tollison, R. E.g., & Politi- and the Economy (1981). The more common analysis, and cians, one em- Legislation the here, legislation as a sale by legislators to treats groups. ployed interest sources for the analysis Important this Part are M. Hayes, Lobbyists in Legislators and Political Olson, Logic of Collective Action (1965); J.Q. M. The Organizations (1981); Wilson, Salisbury, An Exchange Theory (1973); Interest Groups, 13 Midwest J. of Sci. (1969). 1 Pol. See, e.g., D. Truman, supra note 20, at 26-43. 36 HeinOnline -- 74 Va. L. Rev. 285 1988

13 Virginia Law Review [Vol. 74:275 gests, however, that interest groups more form selectively and, therefore, the that demand legislation for is highly biased. 3 7 Professor Mancur Olson's "logic collective of action" helps to explain why interest groups form selectively. so argues He that in- terest group formation involves a classic rider "free problem." Leg- islation a is "nonexcludable" public good that will benefit all mem- bers the of affected group even if they do contribute not its to enactment. Because group members have will incentives to free (i.e., ride collect benefit the without contributing to the effort), not enough members contribute, will the and good public will not be provided. free The rider problem is most acute for groups large in which individual stakes will usually be very small, for there the tendency rely to others on to carry the ball quite will be substan- tial. The problem is acute less for small groups, especially where potential the for gain each beneficiary is larger, because in those groups there is more opportunity the for members to work out a collective deal, and riders free can more easily be monitored and perhaps excluded from the law's benefits. This is most likely if the small group enjoys consensus about its for goals, consensus sub- stantially reduces transaction the of costs group formation. The rider free problem means social that economic and difficul- ties will always not stimulate group formation, especially for large, diffuse groups like consumers and taxpayers, and (in that contrast) small, elite groups might easily more organize, though for no other reason than raid to the public fisc. These conclusions however, are, expressed in probabilities only. Olson recognized that large groups could form there if were selective benefits for their members (e.g., the information sharing and cooperative economic action that farm organizations offer their members), or members if were coerced to join (e.g., professional associations). Additionally, subsequent pub- lic choice scholarship has demonstrated that large groups will sometimes be fueled by shared ideological interests, well-recog- 8 nized threats, and historical factors." Nonetheless, main Olson's point, that different groups will enjoy highly variant abilities to '7 See supra Olson, M. note 35. '8 T. See Moe, Organization The Interests of Hansen, (1980); The Political Economy of Group Membership, 79 Am. Pol. 79 Sci. Rev. (1985); Smith, A Theoretical Analysis of the "Green Lobby," 79 Am. Sci. Pol. Rev. 132 (1985). HeinOnline -- 74 Va. L. Rev. 286 1988

14 Statutory Interpretation 1988] free rider has received some empirical sup- the overcome problem, 9 port is widely and accepted in the public choice literature. Formal organization interest an of is group important if that 40 group wield to is substantial influence in the political arena. Groups that are formally organized and willing to spend money to obtain or block legislation will tend monopolize to attention the of legislators, at the expense groups of that are not organized. The latter will only not to fail their press of point but view, will also be subject to manipulation: they may not recognize the they harms will suffer from proposed legislation even and, if informed, may be falsely reassured symbolic by Notably, action. however, unorgan- ized may interests have still an impact if their preferences are strong and commonly held, public for opinion itself works as an 4 important legislative on constraint ' action. In a very way, rough may plot one probable demand legisla- for 42 tion by looking at incidence the of costs and benefits. asso- Costs ciated with legislation may broadly be distributed, as through a general tax or a increase rule applicable to whole the population, or narrowly concentrated, such as through user a fee or a license charge. legislation Similarly, may benefits offer broadly that are distributed, as such roads other or public goods, or concentrated, such a subsidy as or monopoly a specific to grant group. Under Olson's one theory, expect would concentrated benefits and, espe- cially, concentrated costs to stimulate more group interest forma- because tion, the smaller and more focused groups will normally be better able to surmount the free rider problem. Conversely, distrib- uted costs or benefits will presumably to produce tend not as much organizational activity. The supply of legislation depends on the responses of legislators to these demand Optimistic patterns. pluralists paid little atten- tion to incentive the of structures elected representatives gen- and erally assumed just that the representatives' policy choices repre- sented kind some amalgam of of constituency preferences and reasonable judgment. Public choice theorists, however, suggest that 39 See, e.g., Kim & Walker, The Free Rider Problem: Experimental Evidence, 43 Pub. Choice 3 (1984). See M. Edelman, 10 Symbolic The Uses (1964); Politics of M. supra Hayes, 68- 35, note at 71. 41 See Denzau & Munger, Legislators and Interest Groups: How Unorganized Interests Get Represented, 80 Am. Rev. 89 Sci. Pol. (1986). 42 J.Q. Wilson, note 35; see M. supra supra note 35. Hayes, HeinOnline -- 74 Va. L. Rev. 287 1988

15 Virginia Law Review [Vol. 74:275 representatives' supply legislation of is driven by desire a avoid to controversy and, hence, skewed is toward nondecision rent- and seeking. Public choice theory argues that legislative behavior is driven by 43 one central goal-the legislator's desire to reelected. be A legisla- tor seeking reelection faces "dilemma the the of ungrateful electo- rate": the good things a legislator does an for interest group are forgotten more easily than the bad things are forgiven. To avoid dilemma, this legislator a typically will try to avoid finesse or "con- flictual" demand patterns. On the hand, one legislator the will seek out "consensual" demand patterns-issues which on her constitu- is ency not divided. Thus, legislator a will spend great a deal of time doing "casework" one (no hurt is this by and constituents for whom favors are are done obviously happy) "pork and barreling" (from which the district receives tangible goodies, for paid out of general revenues). same the At time, legislator the will avoid try to taking hard positions on those issues that divide constituents. her on those But issues around which important and organized groups have formed, the legislator will to try help the groups, though in ways that will-she hopes-escape the notice of the legislator's other constituents. On the other hand, when legislator a cannot avoid conflictual demand patterns, she will try to satisfy the all relevant interest groups through a compromise statute acceptable to concerned. all If this cannot be accomplished, the legislator's next-best strategy will support be to an ambiguous law, with de- tails be to filled in later by courts or agencies. that In way, the legislator will be able to assure group each that it and won, then will able be blame to a court or agency if subsequent developments belie assurance. that One can predict what sort of legislative output is likely, again, 4 4 based on the incidence of costs benefits. and Legisla- tion-whether symbolic or substantive-is unlikely there where is organized little demand (distributed benefits), where or demand is 11 See M. Fiorina, Congress: Keystone of the Washington Establishment (1977); D. May- hew, Congress: The Electoral Connection (1974). Contrast this view with R. Fenno, Con- gressmen Committees in (1973), which states that legislators have goals: three reelection, prestige within the legislature, and desire a to contribute policy to debates constructively. See " M. Hayes, supra note 35, at 93-126; Hayes, Semi-Sovereign The Pressure Groups: Critique A of Current Theory and an Alternative Typology, J. Pol. 40 134 (1978). HeinOnline -- 74 Va. L. Rev. 288 1988

16 Statutory Interpretation 19881 4 strong by met of opposition (because And costs). concentrated " if such legislation enacted, is because demand is weak, so the legisla- will tion generally not subsequently be updated to reflect changed circumstances. In situations of consensual demand patterns (pri- marily concentrated benefit, distributed cost measures), legislators will tend to distribute benefits to organized groups, or to grant those groups self-regulatory authority. In conflictual demand situa- tions (concentrated cost measures), legislators will often seek to delegate regulation of the group to an agency. If legislation the dis- tributes benefits at the expense a concentrated of group, the cost payers will tend, over time, to organize themselves effectively to influence the agency. This phenomenon, together with natural bu- e ' 4 capture." "agency called often is in what results forces, reaucratic (If the legislation concentrates both benefits and costs, agency the will become a battleground the for competing interests.) Table 1, below, summarizes demand the and supply patterns for legislation. C. The Inefficacy Proceduralism of Madison anticipated both that majorities might be unstable and that interest groups might raid public the fisc, though public choice theory suggests that he severely underestimated poten- the tial for havoc. But Madison's safe harbor, the one that endeared him pluralists to in the 1950's, was proceduralism. Temporary ma- jorities and factionalism could be controlled procedural by struc- tures such as large constituencies, bicameralism, and the veto. Public choice theory does provide some support Madison's for be- lief that the problems of collective decisionmaking can be amelio- rated structures by of legislative procedure, but the on whole pub- lic choice theorists are more pessimistic about the efficacy of proceduralism than Madison, and much more pessimistic than Madison's heirs of the 1950's. One 11 anomaly mild interest of group theory is why distributed benefit, concentrated cost statutes should be enacted all, at since there ought in most cases be to weak demand and organized opposition such to laws. In the main, public the choice response hearkens back the to Buchanan and Tullock game theory argument that large will groups typically want to press costs onto a smaller See group. supra 284-85. pp. The " seminal work is Stigler, The Theory of Economic Regulation, 2 Bell J. Econ. & Mgmt. 3 Sci. (1971); see also Downs, A. Inside Bureaucracy (1967); Niskanen, W. Bureau- cracy Representative and Government (1971); Peltzman, Toward a More General Theory of Regulation, 19 J.L. Econ. & (1976); 211 Peters, Insiders and Outsiders: The Politics Pres- of sure Group Influence on Bureaucracy, 9 Admin. & Soc'y 191 (1977). HeinOnline -- 74 Va. L. Rev. 289 1988

17 [Vol. 74:275 Virginia Law Review 1 TABLE INTEREST AN GROUP MODEL LEGISLATION OF Distributed benefit/ Distributed benefit/ distributed cost concentrated cost Usually interest little group Opposition tend groups to be formation on issue. Unless stronger than support ones. is there consensus strong on Conflictual demand pattern: no likely issue, legislative action is delegation bill or agency to or symbolic no bill action. If regulation. If the latter, agency law enacted, is the legislature tends to become "captured" will generally fail to monitor over time by interests of the legislation's the performance regulated group. effectively, or update to it. Concentrated benefit/ Concentrated benefit/ distributed cost concentrated cost Often strong interest group ac- Interest groups will tend to tivity supporting action. Con- on form both sides of issue. sensual demand pattern if pub- Conflictual demand pattern: no lic is ill-informed: Distribution bill or delegation to agency benefits of to organized inter- regulation where the organized self-regulation est(s) or for interests the continue can their organized interest. Classic rent- clash. seeking legislation. HeinOnline -- 74 Va. L. Rev. 290 1988

18 Statutory Interpretation 19881 example, For Buchanan and Tullock agree with Madison that bi- cameralism will discourage rent-seeking legislation, because pro- posals that must gather majorities two in different chambers hav- ing distinct constituencies will harder be to obtain and/or more 7 costly. They admit, though, that the overlapping constituencies of Senate the and the House of Representatives dilute the advan- tage of bicameralism and that, among the constituencies of the 4 Senate, farmers and western states overrepresented. are Indeed, the thrust their of analysis is that the procedural protections that might have been appropriate in 1789, when the country was much smaller and government more limited, are wholly inadequate to- day. Hence, new constitutional rules should developed be to reduce 49 the rent-seeking potential government. for Public choice insights support an even more pessimistic analysis, a veritable paradox of proceduralism: procedural obstacles to legis- lation will exacerbate the tendency of the legislature not to pass public goods legislation, but will much not impede its ability to pass rent-seeking laws. This is because procedural obstacles often prove deadly for conflictual or weak-demand patterns (the context in which laws for the public benefit usually emerge). In contrast, procedural obstacles do little to impede consensual demand pat- terns (where bring laws concentrated benefits and dispersed costs). Current efforts to balance the federal budget illustrate the first prong of the paradox-the obstacles to public goods legislation raised procedural by requirements. Proposals raise to general tax revenues and cut federal spending have generated unusual an amount of demand, in part because the potential consequences of deficit the are alarming to several well-organized groups (e.g., bankers). Yet significant no inroads were made between 1982 and 1987, due to procedural hurdles: hostility in committee, threatened presidential vetoes, potential filibusters. Procedural hurdles not only kill most distributed benefit legislation, but also dilute the measures that somehow get through. For example, the Civil Rights '7 Buchanan See J. G. Tullock, & supra note 31, at 233-48. 48 Id. at 246-48. 4" Id. at 286-91. See Buchanan, Constitutional Restrictions on the Power of Government, in Theory The of Public Choice-II, note supra 4, at 439; Tullock, The Backward Society. Static Inefficiency, Rent Seeking, and the Rule Law, of in The Theory of Public Choice-iH, supra note 4, at 224. HeinOnline -- 74 Va. L. Rev. 291 1988

19 292 Virginia Law Review 74:275 [Vol. "discrimination" based on race, Act broadly of prohibits 196450 national color, origin, and to employment) (as Notwithstand- sex. ing strong for demand this legislation, including proposals by three Presidents, it took eight years of intense public to effort pass a meaningful statute. Even then, law the was riddled with com- promises (especially the in employment title) that detracted from Act's the anti-discriminatory purpose, but which were probably 1 necessary to attract support the needed for the legislation. classic A example of the second prong the of paradox-the in- ability of procedures to prevent rent-seeking-is the Smoot- Hawley Tariff of Act the 1930,52 history of which mocks Madiso- 5 nian procedural protections. Essentially, unreasonably the high schedules tariff were drafted by industry beneficiaries and touched 5 4 by up Congress. Of course, the rent-seeking process rarely is so baldly apparent as was it the in case the of Smoot-Hawley Tariff Act. Typically, an interest group groups or seek to public avert de- bate by cloaking their rent-seeking objectives in public-regarding terms; hence, they raise a public justification for distributing bene- them to fits and, by bearing that justification before can them, smooth over opposition. example, For Agricultural the Marketing Agreement Act of 193755 essentially permits regional milk produc- agree ers to on minimum prices, enforced by the Secretary Agri- of culture. Although this seems a, classic rent-seeking scheme, it was justified to Congress necessary as to avoid low the prices farm that arguably contributed to, deepened, and the Great Depression. 50 L. Pub. 88-352, No. 78 Stat. (codified 241 as amended U.S.C. 28 at 1447, § U.S.C. 42 §§ 1975a-1975d, 1971, 2000a-2000h-6 (1982)). 81 background For Civil on the Rights Act, see B. Whalen & C. Whalen, The Longest Debate: Legislative A History Civil of the Act Rights see (1985); W. Eskridge also P. & Frickey, and Statutes Creation the Policy Public of (1987). 2-28 82 June Law of 1930, 17, 46 497, ch. (repealed Stat. 590 in part amended and 1974). See E. Schattschneider, Politics, Pressures Tariff and the (1935). That study summa- is in W. rized Eskridge & P. Frickey, supra 51, note 40-46. at key The measure's the to enactment was a of process "reciprocal noninterference" by interest the groups involved. That is, furniture makers tacitly agreed not oppose to higher lumber tariffs return in for the lumber industry's active support for its own increases. Be- ordinary cause consumers were effectively marginalized the in process, and the relevant in- terest were groups happy to logroll, demand the configuration consensual. was The tariff bill through breezed committees, over sailing procedural the hurdles that supposed are to ensure public deliberation. See E. Schattschneider, supra note 53, at 37-52, n.5. 222 Ch. 53 296, 50 Stat. 246 (codified as amended at 7 U.S.C. §§ 601-674 (1982 & Supp. IV 1986)). HeinOnline -- 74 Va. L. Rev. 292 1988

20 Statutory Interpretation 19881 diffused was justification, and the by Opposition a public-sounding the statute only become apparent over ills rent-seeking of have time. legislation arouse some legislative rent-seeking does Even when conflictual demand pattern), legisla- opposition (producing a more 6 manipulated to sidestep the opposition. be may procedures tive key committee and/or leadership figures can carry The support of past otherwise opposition. Manipula- the legislation troublesome critical procedural also possible if is commit- the tion safeguards of with allies of the important interest groups. Most tees are stacked 7 are to their committee of choice." of members assigned Congress The committee seek is often one where they cater they the can to of constituencies, especially organized constituencies. needs their may Hence, frequently are, dominated by a be, committees and of the Agriculture Com- group representatives: narrowly interested of farmers, the Energy Committee by mittee by representatives to those with ties energy forth. so and producers, To the extent committees control the agenda, which they often that these appear 5s they can produce systematically biased results. This is to do, the nightmare. of more Madisonian of this phenomenon is section 1323 of the Alaska An example Interest Lands (Alaska Lands) Act of National Conservation 9 statute 1980." The generally transferred substantial portions of land in Alaska to the state; a bill compromising the con- federal of cerns industry, and environmentalists passed the the state, Senate committee, western senator proposed an House." In a The 56 most manipulability complete examination of the is congressional of procedures T. Success and Influence in Sullivan, (1984), and the points Procedural Structure: Congress text suggested to me were that work. in made by 57 See Gertzog, The Routinization of Committee Assignments in the U.S. House of Repre- J. sentatives, Sci. 693 (1976). 20 Am. Pol. Denzau & MacKay, Gatekeeping and " Power of Committees: An Analysis See Monopoly Sincere Sophisticated Behavior, 27 Am. J. and Sci. 740 (1983) (committees have of Pol. power over the legislative agenda and resource advantages over likely substantial opponents). " No. 96-487, Pub. L. 2371 (codified amended 94 Stat. as sections 16 and scattered in of 43 U.S.C.). passed On 1979, the House of Representatives 16, H.R. 39, the bill addressing 60 May wilderness lands. However, the original text of H.R. 39 had been replaced by an Colorado substitute in of a substitute. The nature amendment, offered by Represen- the amendment Udall of Arizona, was originally the text of H.R. 3651, a measure supported by the tative 125 Committee Interior and Insular Affairs. See on Cong. Rec. 11,051-128, 11,457-59 House (1979). HeinOnline -- 74 Va. L. Rev. 293 1988

21 Review Law Virginia [Vol. 74:275 1323) grant easements apparently (section amendment to designed or forest by federal surrounded landowners private to necessity by 1 was amendment The in States. United the lands public anywhere landown- western to interests property of federal giveaway great a more environmentally the passed could not have ers likely and 2 it have been approved nor would its merits, on House concerned was the provision alone. But had it stood Carter President by and was swept bill to the complicated last minute at added the public examination. no with virtually through is market the of legislative model group the interest Although of terms in expressed and caveats with necessarily hedged mar- legislative grim. The pretty is thrust its general probabilities, government that goods The public badly. works that ket is one distributed benefit, distributed providing-especially to ought be because de- legislature, the passed by seldom measures-are cost little too gain and legislators strong not usually is them mand for not will enacted, they are laws such if them. Even sponsoring from fail often will the legislature because long, for useful very remain reflect to or problem of the forms new to them address update to policies. national changed concentrated bene- statutes-primarily, rent-seeking Conversely, dis- This is most inevitable. measures-seem cost fit, distributed such imposed by social costs significant the because of tressing, 6 3 costs, typically creates legislation rent-seeking statutes. First, Wilder- See Montana Melcher, of Montana. by Senator offered The amendment was 61 § of (legislative history 955-57 nn.5-11 & at generally id. F.2d at 956 n.8. See ness, 655 Cong. Code U.S. 1980 in (1980), reprinted 310 Sess. 2d Cong., No. 96th 413, 1323); S. Rep. of report the noted be that should the section). It of (discussion 5254 News Admin. & 5070, analysis of §§ 1323 and 1324; its of its analyses reversed cited supra, committee, Senate the n.6. at 955 655 F.2d Montana Wilderness, here apposite. See therefore, 1324 is, § House the by critically been scrutinized have would giveaway federal thing, the For one 02 (Morris Udall of of the committee chair Affairs. The and Interior Insular on Committee ardent were 1980 in Democrats the committee's of proportion and a substantial Arizona) forfeiture national sweeping a skeptical of been certainly would have who environmentalists The of Almanac G. & D. Matthews, Barone, Ujifusa See M. generally of federal rights. vote on 1978 to a key and Matthews looked Barone, Ujifusa, 1980 Politics (1979). American environmental on stand each representative's measure a as of protection wilderness Alaska (in- 19 1980, in Affairs Committee Interior and Insular of the the members Among issues. 11 of and (5 in 1978, protections the wilderness of in voted favor Democrats) 17 cluding 988. xxi, at id. See protections. against voted the Democrats) whom were G. & Tollison (J. Buchanan, R. Society the of Theory Rent-Seeking Towards See a 0" and and Tollison, by McCormick Krueger, contributions the eds. 1980) (especially Tullock HeinOnline -- 74 Va. L. Rev. 294 1988

22 Statutory Interpretation 19881 which accrued benefited by are the on and group imposed society. interest, special The however, usually squanders virtually all of its on benefit to efforts obtain the rent-seeking leav- legislation, thus ing society with complete a deadweight loss. rent-seek- Second, as ing increases, behavior is interests not only it the benefits seeking that must expend resources. Unregulated move must interests also defensively, to expending resources resist that might rent-seeking hurt broadens only This them. the most social loss. Third, and sig- prospect nificantly, the creates of itself regulation a social loss: rent-seeking society systematically will tend resources divert to from their efficient if-as most uses often the is most case-those are uses rendered less attractive by regulation. WITHOUT II. POLITICS ROMANCE: CHOICE PUBLIC THEORY'S IMPLI- CATIONS STATUTORY FOR INTERPRETATION one If choice public accepts the Madisonian critique of the rec- onciliation, how should approach one statutory interpretation? Merely rejecting the Madisonian does tradition not establish that should courts go beyond the archeological approach. For example, one can maintain courts that should ferret and out enforce the original "devil's embodied bargains" in statutes, based a upon strong adherence to legislative supremacy. choice Public theory only requires candor in that the legislative recognizing is policy often fragmentary Professor irrational. and Indeed, Buchanan's the role work on of the "contractarian judge" on as- the whole that sumes interpretation statutory original simply enforces the 64 Judge bargains, and Posner's statutory on early articles interpre- 5 tation reflected a similar view. Corcoran Tullock); Rent-Seeking & Karels, Behavior in 46 the Long-Run, 227 Pub. Choice Political Krueger, (1985); The of the Rent-Seeking Society, Economy Rev. 291 Am. 64 Econ. Posner, (1974); The of Monopoly and Social Costs 83 Pol. Econ. 807 (1975); Regulation, J. Tullock, The Welfare Costs of Tariffs, Monopolies, Theft, 5 W. Econ. J. 224 (1967); and see also Macey, Constitutional note Ordering, 474-85 (describing 8, supra at choice the public literature greater in detail). See J. Contractarian Political Buchanan, Constitutional Economy and Interpretation (draft, a session of the American prepared for Association, Economic Chicago, Ill., Dec. 1987) (copy on file the Virginia Law Review with Association). " See Posner, Landes & Independent The Judiciary in an Interest-Group Perspective, 18 Econ. 875 J.L. & (1975) (arguing that the archeological to statutory approach interpretation is with interest group consistent politics); Posner, Economics, Politics, note 5; Posner, supra Interpretation, supra note 5. Statutory HeinOnline -- 74 Va. L. Rev. 295 1988

23 296 Virginia Law Review 74:275 [Vol. Although public choice theory is logically compatible with the archeological approach, the systemic legislative dysfunctions it ex- poses make one restive. The current literature applying public choice theory to statutory interpretation reflects uneasiness. that Judge Posner's more recent work, for example, posits that the archeological approach has little contribute to the to interpretation 66 Act. Sherman the as such statutes phrased generally older, of These statutes, Judge argues, Posner ought be to interpreted a in common law fashion. If Congress drops an important problem in the judiciary's with lap, scant instructions how on to deal with it, then it makes sense as a matter policy of for courts simply to make 6 7 of Most reasonable. seems what to according case-by-case, law the statutes Judge Posner would call "common law statutes" are distributed benefit, distributed cost statutes. His liberal interpre- tation such of statutes makes public choice sense, because these precisely are the statutes Congress that will generally fail to up- date to reflect modern policy developments. A limitation Judge of Posner's theory that is only attacks it the first public choice dysfunction-the failure the of legislature to up- date public interest laws-but not second, the more and troubling, dysfunction-the existence too of many rent-seeking laws. Judge Easterbrook's theory, on the other hand, is concerned about this second dysfunction. His seminal article statutory on interpretation argues that the "unless statute plainly courts hands the power to create revise and form a of common law, the domain the statute of should be restricted to cases anticipated by its framers and ex- pressly resolved the in legislative process," preferably through ex- 6 8 press textual treatment. Although Judge Easterbrook has not 69 pursued the implications of his theory, its exacting textualism 66 See Posner, The Decline as Law of Autonomous an Discipline: 1962-1987, Harv. 100 L. 761, Rev. 774-77 (1987); Legal Posner, Formalism, note supra 5. Posner, 87 Formalism, Legal supra at note 5, 199-201. as Easterbrook, Statutes' Domains, supra 6, 544; note at see also at id. 544-45 ap- (this proach overlaps "clear the statement" principle of statutory construction). Indeed, "' Easterbrook, Foreword, supra.note retreats 6, the theory from earlier the of article. Following Judge Judge Posner, Easterbrook liberal urges interpretation of "public interest statutes" such as the Sherman Act. As to "private interest statutes," a judge "im- plements the bargain a as faithful agent but without enthusiasm; asked extend to the scope of back-room a he deal, unless refuses proof the the of deal's is compelling." scope Id. 15. at this In later article, Judge Easterbrook seems more willing to allow "devil's bargains" to be enforced than the he was in article. first id. at See 49-51. HeinOnline -- 74 Va. L. Rev. 296 1988

24 Statutory Interpretation 1988] provides useful one way rent-seeking limit to legislation. By refus- to ing validate interest group deals not manifested the in clear statutory text, approach this hinder would enforcement the of backdoor bargains, would and force interest groups to spend more money and time procure to explicit statutory language sanctioning their deals. Like approach, Judge Posner's Easterbrook's Judge however, fal- ters when a court, rather than offering its own interpretation of a reviewing is statute, agency's an interpretation of the statute in question. statutory Most interpretation today done is, after all, by agencies departments, and with courts merely serving as "supervi- sory institutions," rather than "primary as institu- implementation 7 0 ' The tions. original Posnerian deal such in statutes typically is to delegate extensive power rulemaking agencies to departments; or operative the Easterbrookian language these in therefore cases gives generally agencies (and the courts) not the power create to and revise of common a form law. Yet choice public teaches theory us that, over time, these and agencies departments to are subject powerful rent-seeking pressures. Is there any for way courts to counterbalance this? Professor Macey's theory offers one useful re- sponse this to problem. argues He courts that enforce should the original public-regarding justifications for a as a statute, check interest against subsequent efforts groups' stat- the manipulate to 1 7 ends. private their serve to ute What seems most about striking dialogue the among public choice-inspired theorists legal writing about statutory interpreta- is piecemeal tion their the archeological abandonment of approach. Indeed, of the each legal theorists contributes distinct, a valuable insight, suggesting interpretive methods that might courts use to aspect some offset the legislative of dysfunction suggested by pub- lic The insight choice. of each can be scholar in expressed terms of the configurations and demand supply in Part developed I of this Article. Posner's Judge common law approach a useful is often strategy interpreting for distributed distributed benefit, stat- cost utes, which serve public policies susceptible are but to evasion and 70 Rubin, Legislation E. the in Administrative State (draft Sept. (copy 1987) on file with the Virginia Law Review see Diver, Association); Statutory Interpretation in the Adminis- 549 State, Pa. L. Rev. U. (1985). 133 trative 71 See Macey, Public-Regarding Legislation, supra note 8, at 250-52. HeinOnline -- 74 Va. L. Rev. 297 1988

25 [Vol. 74:275 Virginia Law Review Judge by Congress. seldom updated are they because obsolescence is strategy for nar- a Easterbrook's exacting textualism legitimate rowing the damage concentrated done by benefit, distributed cost is approach Professor Macey's statutes. rent-seeking) worst (the often which most to create best concentrated cost statutes, suited original articulated public regulatory bureaucracies, because the purpose concept an is elastic limiting bureau- of evolution the the cracy toward Cumulatively, goals. private these theories be can for the theory viewed "dynamic statutory as different strategies of 72 an earlier article. in Professors have I interpretation" defended in this Symposium articulate the core lesson in Farber and Frickey arguing a statutory interpretation involves an as- related way, that current of each possible interpretation, as sessment effects the of 7 3 a Table 2 outlines legislative original expectations. well as the dynamic statutory interpretation. public choice version of insights in 2 synthesizes the Table of forth set approach The offers different strategies for dealing prior dif- theories, and with in legislative-administrative process. The ferent dysfunctions the worth this it an approach make con- of synthesis practical virtues shares an overall problem with sidering, of the theories but it each it borrows-it which from fails to explain and justify the institu- of division the courts, Congress, and the agen- tional labor among 7 4 approach affords the courts sig- cies. intermediate, This dynamic power. But, public choice or given lawbending, nificant lawmaking, assumptions, do courts have a comparative Con- over advantage creative assume such a the role? Even if gress agencies to and a comparative advantage in courts respects, what do have some accrue judicial creativity were openly en- disadvantages might if would dysfunctions of interest group example, dorsed? For the themselves, moving from legislative politics simply replicate supra Eskridge, 10. 72 See note and Farber 73 Frickey that the best statutory argue that one that maxi- interpretation is product the value times the probability that Congress intended that very mizes of social put interpretation the rational judge should choose the they -x- that interpretation; as it, interpretation v(x), p(x) is the probability that the . is the one in- p(x) maximizes where Congress and v(x) is the value or usefulness of that interpretation. See Farber & tended by note at 462-65. 7, Frickey, supra Article does not explore the constitutional justifications for dynamic statutory in- 74 This Eskridge, a of that issue, see treatment supra note 10. for terpretation; HeinOnline -- 74 Va. L. Rev. 298 1988

26 "299 19881 Statutory Interpretation 2 TABLE STATUTORY DYNAMIC INTERPRETATION Distributed benefit/ benefit/ Distributed distributed cost concentrated cost law Interpret in a common to Interpret effectuate stated fashion, limited by the statu- public purposes and to reflect language, tory changing updating to re- or constitutional legal flect changed circumstances. frame values, within the of (Similar Posner's theory.) to ongoing agency implementa- to Macey's the- tion. (Similar ory.) Concentrated benefit/ Concentrated benefit/ distributed concentrated cost cost narrowly Interpret Interpret refuse and effectuate original to provide to un- benefits special deal among interest groups ef- less clearly statute. required by stated the fectuating public the- purposes of (Similar statute within Easterbrook's to the ory,) of ongoing agency the frame to Ma- (Similar interpretation. cey's theory.) HeinOnline -- 74 Va. L. Rev. 299 1988

27 [Vol. 74:275 Virginia Law Review chambers chambers? Contrariwise, to judicial make can courts if "better" rules than Congress the or agencies, why go not all the way to free a inquiry approach? Or would that approach, too, en- counter institutional disadvantages? These are questions that any general theory of statutory inter- pretation ought to address, whether inspired by public choice or not. Because public choice theory offers structured a framework for discussing different "constitutional" arrangements for our pub- 7 5 lic institutions and for anticipating dysfunctions, it is surprising that so little has been done-by either legal scholars or econo- mists-to use public choice theory a as basis for exploring the po- tential consequences of different approaches to statutory interpre- tation. In the remainder this of Part, I should like to suggest the beginnings of such an inquiry through the use of a public choice thought experiment. Let us consider intermediate, the dynamic ap- proach to statutory interpretation, outlined in Table 2, as hy- a pothesis competing with the archeological and free inquiry ap- proaches. Public choice theory frames three inquiries by which to compare the competing approaches. First, which approach best re- flects the comparative institutional advantages of Congress, the agencies, courts and to make legal rules? Second, what effects would each approach have on the political actors, including inter- est groups and Congress? Third, what would the be consequences each of approach for the general dynamics of our political system? In undertaking each inquiry, shall I first ask whether the interme- diate, dynamic approach advantages has over the archeological ap- proach and, then, whether the free inquiry approach advan- has tages the over other two. Unhappily, the questions suggested by public choice theory are more satisfying than the answers. My conclusion below that is the existing theoretical and empirical public choice literature-still in its rudimentary stages-offers no determinative resolution even for this rather simplified thought experiment. The public choice litera- ture does, however, indicate that courts have some comparative ad- vantages over the legislature in making legal rules, because they 11 Public choice literature talks about "constitutional" rules as those setting forth the specific institutional and roles constraints, opposed as to the "positive" rules, which are the products yielded by the institutions operating under constitutional rules. See, e.g., J. Buchanan, supra note 64. HeinOnline -- 74 Va. L. Rev. 300 1988

28 1988] Statutory Interpretation directly less interest group pressures. Moreover, accountable are to also choice public theory final frank, a suggests that abandonment of archeological the would in approach only marginally practice These conclusions, of course, just reshape our political system. of- fer intermediate, for tentative support the approach, dynamic and they thus the need for public suggest develop choice scholars to sophisticated more of ways analyzing issues. these of Courts, Legislatures, and Relative The A. Competence Legal Rules Agencies to Make The initial-and the perhaps most important-question is courts whether have a advantage comparative in over legislatures creating updating legal or analysis Public rules. choice would as- courts, like legislatures, sume subject to analysis based that are demand supply incentives. Is there reason to believe that upon and courts not to be will susceptible that same the dysfunctions public choice has highlighted in the If legislature? courts are sub- in fact ject or same dysfunctions, to the similar be to seems there scant to prefer the intermediate, reason dynamic approach tradi- the to confined archeological approach. more tional, a small industry arguing about the relative effi- cottage There is 6 common the of ciency law,7 scholars have few but systematically 7 7 Most perspective. choice a public from behavior judicial analyzed literature supports the of the proposition that courts to create tend efficient legal excellent rules. An Professor article Paul by Rubin, questioned however, both has that the and proposition strong con- trast-consistently the efficiency made in the literature-between and the of judicial rules inefficiency of legislative ones.", Citing contends he historical examples, groups as that, interest have been Chapters " 19 13 Judge Richard Posner's and of Analysis Law (3d Economic of 1986) ed. argue the relative efficiency of the common for also Landes & Posner, Adjudication law. See (adjudication a 8 J. Legal Stud. 235 (1979) Good, in the courts tends to produce as Private results). Several authors have argued that the common law is efficient because inef- efficient ficient precedents more often, are litigated The Law Process Priest, Common e.g., and the Efficient Rules, 6 J. Legal Stud. 65 (1977); Rubin, Why Is the Selection Law of Common 6 Legal Stud. 51 (1977), though this J. been critiqued in Cooter & Korn- Efficient?, has Can Litigation Improve the Law Without the Help of Judges?, 9 J. Legal Stud. 139 hauser, (1980). 77 see W. Landes & R. Posner, The Economic exceptions, of Tort Law ch. 1 For Structure G. Tullock, (1987); on Trial ch. Trials (1980). 12 See Rubin, Common Law and Statute Law, 78 J. Legal Stud. 205, 207 (1982). 11 HeinOnline -- 74 Va. L. Rev. 301 1988

29 302 Virginia Law Review 74:275 [Vol. in the legislative process, they have able greater to influence exert played increasingly an prominent in role litigation as The well. same concentrated groups that employ lobbyists to secure favorable legislative also treatment typically employ lawyers ob- to tain favorable judicial In treatment. Rubin's view, legisla- much as tive decisionmaking organized favor will groups, too will judicial so decisionmaking, especially if there is no effective counterpoise to organized the groups. Generally, "the party with inter- ongoing the [is] the est party to prevail in obtaining court favorable rulings and favorable also legislation (or lack the effective of unfavorable 7 9 legislation)." Rubin's argument, however, lacks a hard empirical foundation 80 and on relies controversial examples. Hence, not it is the final word influence on the interest of groups in the judicial arena. Nonetheless, his thesis makes a good of deal public sense choice and bottom, seems, at many to be correct in cases. exam- recent A of ple interest groups' impact in litigation was Court's the Supreme leading statutory case Term. last v. In Johnson Transportation 8 Agency, Santa Clara ' County, the Supreme reaffirmed Court its interpretation that title VII of the Rights Civil 196482 Act of per- mits voluntary affirmative action employment in and few, imposes any, if limits on such (thus programs expanding arguably on prior 8 3 decisions). Justice in Scalia, chided dissent, for the Court sacrific- interests ing the a of powerless, relatively diffuse group (blue-collar white males) to political the of preferences powerful, those well- organized groups that support now affirmative action (blacks, 8 4 and women, even many employers and unions). Though Justice Scalia's point is controversial, true it is Court's the that holding created special exception a to the general duty not to discriminate basis on the sex, and race of and that this result was enthusiasti- see 11 at 217; Id. the Why Galanter, Come Out "Haves" Ahead: Speculations on the Lim- Legal of its Soc'y Change, & 9 Law (1974). 95 Rev. so Rubin's main example of modern common rent-seeking law is the unconscionability doctrine. Rubin, See supra note 78, at 209-10. A characterization unconscionability the of doctrine as rent-seeking of controversial. course, is, Si 107 Ct. 1442 S. (1987). See Rights Civil § Act of 1964, U.S.C. 42 703(a), § 2000e-2(a) (1982). See Johnson, S. at 1449-56; Ct. 107 id. at 1466 (Scalia, J., dissenting) that (suggesting Johnson further expanded interpretation the to VII title of race- and sex-specific allow plans). 1475-76 (Scalia, J., dissenting). "' Id. at HeinOnline -- 74 Va. L. Rev. 302 1988

30 Statutory Interpretation 303 19881 the by are best organized (in both the supported groups cally that judicial and legislative on this fora) issue. Although Professor suggests Rubin interest that group pressures sometimes are important judicial for lawmaking, he posit does not are that courts always pressures. to subject these points he Indeed where out that, there are symmetrical interests an side on either of courts time, over issue presumably efficient will reach It results."' is when only the interests are asymmetrical his arguments that strictly apply. Hence, thesis his may support application the of a dynamic interpretation to distributed distributed benefit, cost statutes, symmetrical usually which involve According interests. to public choice these legal theory, be efficient tend will rules to at genesis, their whether by made the legislature or courts. Public the choice theory though, out, points that these statutes tend to grow obsolete over time, since legislators-too often obsessed with re- election-generally neglect of types these and laws can (because of buffers) procedural all easily avoid too dealing the them. with On other the hand, life federal tenure of judges frees from them hav- to ing to cater and constituencies, special jurisdic- the mandatory federal of tion cases makes it for difficult judges-unlike legisla- avoid tors-to the task of updating policy. statutory Litigants before a decision, are entitled to court a the and devices to avoid merits of (such as questions standing) in are invoked only excep- cases. tional Rubin's article therefore the supports that view courts behaving a common in manner law a comparative have advantage over Con- in updating gress symmetrical, public goods laws (the legisla- first dysfunction). tive On his the other hand, serious article raises doubts that courts can against police rent-seeking any rules better Congress than second legislative can (the ar- Rubin's dysfunction). gument however, is, overstated this respect. in Although he is surely correct that interest groups are sometimes to able obtain rent-seeking courts from results courts, types struc- enjoy three of tural suggest that that advantages the less judiciary will be prone results than Congress. to rent-seeking The first courts' advantage lies structures. in demand Although interest groups in play a role process, judicial the it appears that and influence the incidence behavior group of different in the are Rubin, supra note 78, at 214-16. 85 See HeinOnline -- 74 Va. L. Rev. 303 1988

31 Virginia Law Review [Vol. 74:275 judicial (in comparison to the legislative) arena. To begin with, there less is to likely the be high same degree asymmetry of of viewpoints litigation in there that routinely is in legislation. Courts generally have least at parties two representing opposing interests in a litigated case, and a court refuse will hear to that a case does not reflect truly a adversarial controversy. Lines of alliance and opposition in tend, judicial the arena, to both be more clearly and more sharply drawn. arrayed Thus in full opposition, parties to a litigation generally do everything possible to bring all their argu- ments before the court. If court a is not satisfied that parties the have adequately canvassed the arguments, may it out-and seek in 88 any event will often receive-amicus briefs. Hence, although there will often some be bias the in courtroom because party one has greater litigation experience resources, or there is not the utter of dearth opposing viewpoints that one frequently finds leg- the in islative process. Additionally, the groups that opt for litigation to effect their policy goals are often more broadly based. "Encompassing groups" (those including many people and usually more broadly represen- tative of the overall public interest) will sometimes more have of a in role litigation than legislation, in because the rider free problem is more easily overcome litigation. in The action, class in particu- lar, is a good way encompassing an for group organized be to on an issue: if even each group member's stake small, is class a action can organized be by entrepreneurial counsel, who can muster re- the sources to contend effectively with traditionally well-organized 7 groups." Many encompassing groups (e.g., consumer and environ- mental groups) are active in both the legislative judicial and arenas, and may one prefer arena over another at different times. 86 When the Supreme Court decides important an issue statutory of interpretation such as affirmative action, it typically receives number a of briefs amici of curiae reflecting a variety viewpoints. of This phenomenon occurs also (obviously, less often) in lower courts. See, e.g., Cartledge v. Miller, 457 F. Supp. 1146, 1149 (S.D.N.Y. 1978). 8 Rubin concedes that class actions sometimes can ensure symmetry a greater of inter- ests being represented, but argues that such classes tend also (in other circumstances) to about bring the same inefficient results do as lobbying groups. Rubin, See note supra 78, at Note 219-22. class that actions themselves have problems of heterogeneity, the class so that counsel may not adequately represent the interests of all class members. Rhode, See Class Conflicts in Class Actions, Stan. 34 Rev. L. 1183, 1204-15 (1982). Courts supposed are to monitor this through difficulty the class certification procedures Fed. R. of P. 23(a)-(b) Civ. and the settlement procedures Fed. of R. Civ. P. 23(e). HeinOnline -- 74 Va. L. Rev. 304 1988

32 305 Interpretation Statutory 1988] judicial the on balance, to be somewhat eas- to arena Access seems, is demand suggestive: because the only The ier. analysis broadly judicial greater to tends process attract viewpoints, symmetry of variety greater a and interests gain consideration, of thus less it is group likely that one narrow will given special treatment be not public interest. the by justified larger Rubin's article deals with demand structures in- careful in a and disagreement my and way, telligent him only with is matter of a degree. the think I substantial more problem argu- Rubin's with ment is its failure consider to supply structures judiciary. for the second, This is the and advantage more significant, courts that legislatures. over have self-interest, Judges' unlike legislators', will generally not or the warp direction "supply" decisions. judicial of tenure of interest Lifetime makes functionally independent judges group legislators influence that in ways Although rarely are. judges appointed may be some political with about expectations their per- 8 formance, is no there way to enforce those expectations." The very nonaccountability gives judges of legislators-the them-unlike freedom policy choices without falling athwart the to make hard dilemma of the electorate. ungrateful relative nonac- Their countability them with few leaves also to incentives to cozy up in- 9 terest most groups, who can in good. them instances do no In precisely short, because subject are they not pres- to reelection sures, judges major force skewing avoid a views. legislators' judges? Public choice literature has not ex- What does motivate not definitively), but thoroughly (and certainly this issue plored Professor '6 in Robert and Public Tollison, Choice 339, Rev. L. Va. 74 Legislation, 346 argues that legislative (1988), control of judicial judicial salaries will constrain I behavior. of the Constitution prevents Congress Article lowering judicial salaries doubt it. HI from discriminating against judges and prove to be too creative. A judge (implicitly) from who incentive has little creative, be conduct to because not her be not alone will probably stimulate enough to the reprisals congressional against whole. judiciary Macey, as a See Constitutional 8, at 497-98. supra Ordering, note federal has in the the Also, judiciary last been increasingly creative, 20 years supra Eskridge, at 1482-97, see note 10, though even in salaries have real dollars judges' the Posner, supra declined. See, e.g., R. 36-37 at 5, note that (indicating salaries federal declined judges' real have as since 1969). The as much 40% salary club not appear to does weighty one. a be very say "in most instances" because, 89 1 judges federal though (unlike legislators) not do contributions, votes and need campaign do can groups interest still espe- some judges good, when cially those groups employ substantial numbers Public praise for, or crit- of attorneys. a by an interested judge icism of, the bar can enhance or segment of judge's the lower prestige. HeinOnline -- 74 Va. L. Rev. 305 1988

33 [Vol. 74:275 Virginia Law Review several observations are relatively uncontroversial. are Judges ap- parently primarily not motivated by a desire to maximize leisure time, the for most casual inquiry reveals them to industrious an be Nor lot. money does to seem a be dominant motivation, fed- since eral judges could make much more their than public salary were they resign to and to enter private practice. Promotion is a possi- ble motivation for district court judges, but for not the appellate judges who make final the rulings matters on statutory of interpre- tation, for the vast majority those of appellate judges see their positions terminal. as Public choice theorists, their in search for the motivations shaping judges' behavior, emphasized have such factors prestige, as the ability influence to the law, and auton- 9 0 omy. How judges do maximize these intangibles? Different strat- egies are possible, but the successful most ones generally impel judges to avoid rent-seeking results. For example, though a judge might curry favor with certain interest so groups they that would "talk up" the judge within bar, the strategy this would as just backfire likely if were viewed-and it criticized-as action incon- 9 1 sistent with "judicial a temperament." A better strategy for building is prestige to write decisions judicial appeal that to a vari- of ety viewpoints that and cannot be attacked as careless subjec- or tive. Judges seeking to write such decisions generally must heed the views of encompassing groups rather than the views of narrow ones, must and consider the third-party (public) ramifications of 9 2 legal rules. This strategy, then, lends judges a motivational ad- vantage over legislators, who tend to neglect third-party ramifications. also Rubin neglects a third theoretical advantage of judge- created rules: process structures. It is hard to evaluate the impor- See 90 R. Posner, supra note 76, at 505-07 maximize (judges their influence and op- the portunities to impose their preferences legal on Cooter, parties); The Objectives of Private Public and 41 Judges, Choice Pub. 107, 129 (1983) (judges seek to tend to maximize their "prestige" among litigants). Contrast " the confirmation recent difficulties of Judge Bork, was perceived who by some have to "campaigned" for the Court by appeasing conservative interest groups, with the clear-sledding Judge of Kennedy, who was perceived as "balanced," even less if brilliant than Judge Bork. My impression is that are there not big differences in their respective voting records. 92 Judge Posner argues that will judges prefer efficient results. Inefficient judicial rules diminish the power of judges, parties because will tend to contract them around and Con- gress might overrule them. Posner, R. See supra note 76, at 505-07. HeinOnline -- 74 Va. L. Rev. 306 1988

34 307 Statutory 1988] Interpretation this seems to reinforce the supply and demand of factor; tance it reasons courts why be less will Congress than likely adopt to rent- seeking rules. Apart the from process advantage arising from relative courts' inability to set their own judicial agenda, the pro- against also cess works because results rent-seeking is rea- it open, 9 3 incremental soned, and the On in its rulemaking. ap- there whole, to be systematic pears more and open experimentation judicial in lawmaking than there legislative in is lawmaking, because of the hierarchical structure federal of the court system. may Legal issues treated first be district by circuit and which courts, justify their by positions setting published rationales forth in opinions. one If position widely is acceptable, it, other courts will follow and liti- tend gants will issue. the stop to arguing If the lower courts split on the the issue, Supreme Court resolve will often it, the with ben- of efit years educated of of discussion the the issue. If makes Court in a mistake the resolving is issue, subject it to external criticism subsequent narrowing and trial-and-error in decision, of the fash- Although ion. issues course, percolate may, of similarly legis- in the lature extended periods, for an issue attention the given leg- in the over is, islature time, typically less sustained and deliberative than is it in judicial system. the In short, public choice provides theory tentative sup- theoretical that the for port view lawmaking has judicial advan- important tages legislative over lawmaking, at least insofar as judiciary the is more likely to update distributed laws benefit to meet changed cir- cumstances. The is public evidence choice equivocal more regard- ing the that courts proposition to rent-seek- able better are avoid ing rules, but provides substantial theoretical that support for proposition well. as But in courts if fact do a better at job avoiding the main public choice dysfunctions the plague that be- legislature, question the adopt not Why comes: the free inquiry pure approach to statutory in which interpretation, law? common becomes law all An initial problem this with is approach that the legislature performs a vital role in the creation of public policy, the under even most cynical incremental theory. The judicial of nature lawmaking and the in- dependence judges from political of courts groups suggest that are See 93 S. Burton, An Introduction to Law and Legal Reasoning (1985); Fiss, The Supreme Court, 1978 The Forms Term-Foreword: 93 Harv. L. Rev. of Justice, (1979). 1 HeinOnline -- 74 Va. L. Rev. 307 1988

35 Virginia Law Review [Vol. 74:275 often not effective as as Congress responding in to problems public that require expeditious detailed or action (not mention to public funding and bureaucracy). a Even distributed benefit, distributed cost statutes (which are analogous the to common and law hence are most susceptible to case-by-case development) often require ju- dicial deference legislative to policy judgments to assure that the common law evolution of statute the not does wander too far afield 94 desires. popular from free A inquiry approach would likely prove most impractical for concentrated cost regulatory statutes, since these require very de- tailed factfinding and constant updating or fine-tuning that even Congress cannot do-and certainly courts cannot, under con- their ventional resource limitations. Agencies and executive departments administer these regulatory statutes, enjoy and some of the courts' same comparative advantages over Congress. Bureaucrats are unelected (as judges are), though their lack of lifetime tenure makes them more susceptible interest to group influence. Agency procedures are open, reasoned, and incremental judicial like proce- dures, though this an is ideal attained practice in less often by agencies than by courts. Notwithstanding these institutional ad- vantages agencies, of public choice theorists argue that agency an tends to "captured" be over time, as interest group demands grow increasingly asymmetrical and the agency loses outside political support and institutional momentum. Although traditional process theorists, such Professor as Colin Diver, have argued continued for 95 judicial deference agency to rules, time over the probable rent- seeking nature of many agency rules would make this approach 9 6 less attractive to a public choice theorist. Still, the massive fac- investigations tual and political judgments needed to create such rules render a free inquiry approach but all impossible for courts. The intermediate, dynamic approach, which would generally hold '4 For early observations along these lines, see Pound, Common Law and Legislation, 21 Harv. L. Rev. 383 (1908); Landis, Statutes Sources and of Law, in Harvard Legal Essays 213 (1934); Stone, Common The Law in the United States, Harv. 50 L. Rev. 4 (1936). 11 See Diver, supra note 582-93. at 70, 96 Diver, in view, my underestimates the effect that special interests and can do have on agencies. For example, Diver mentions an unsophisticated form of the "capture" theory, id. n.194, 581 at but explore to fails the many and ways subtle agencies biased are influenced or time over by the barrage of special interest pressure. Compare the treatment of similar is- sues Stewart, in The Reformation of American Administrative Law, 88 L. Harv. Rev. 1669, 1760-70 (1975). HeinOnline -- 74 Va. L. Rev. 308 1988

36 Statutory Interpretation agencies to stated purposes public and open procedures, plau- is a sible public choice position. compromise further problem A the with inquiry free it approach is that undermine might the checking function of the Courts' judiciary. institutional illuminated advantages-as public by choice the- ory-are strongest at their when court a is supplementing or legislative checking or administrative dysfunctions, for the ju- then diciary the serves that role same bicameralism in (at least theory) does: an additional it is through filter which or rule a law must Because pass. courts responsive are different to than concerns are legislatures agencies, or can they sometimes work out problems not caught in legislative the administrative or processes. But if courts were to primary seize a the role in process, lawmaking much of the beneficial "filtering" be lost. If courts would the adopting in- free quiry approach to misstep, were "review" those decisions of would be Congress left to an (through amendment to the statute) to and the agencies (through shrewd circumvention the courts' of hold- Both ings). Congress and the agencies are, however, ill-suited to the task. It is generally very difficult to sufficient organize interest in the legislature a court to "overrule" decision, agency's and an enforcement scheme to tends become checkered incoherent and if seeks agency the to maneuver around central, a contradictory court opinion. Finally, free inquiry approach the tend to introduce would more explicitly political on courts. the pressure If to a were courts adopt primary in role the lawmaking process, there be great would pres- sure make to them more "accountable," perhaps through extensive confirmation novel salary hearings, incentives, and the like. The effect of this is unpredictable, probably but some advan- of the tages of judicial independence would be lost. of Impact B. Rules of Statutory Interpretation on Congress, Agencies, Interest Groups and Assuming that judiciary is competent the supplement to legisla- tive lawmaking, public choice theory asks what would be the insti- tutional political and effects of explicitly adopting dynamic a ap- proach in place of the archeological approach. Would it any yield likely benefits, given the institutional dynamics of our polity? Would those benefits be offset by corresponding disadvantages? HeinOnline -- 74 Va. L. Rev. 309 1988

37 Virginia Law Review [Vol. 74:275 On a theoretical level, one should expect least at three conse- quences, each of indeterminate magnitude. First, if courts were to adopt an interpretative strategy aimed at narrowing or circumventing privately motivated statutory "deals," one would expect less such of rent-seeking legislation, because in- terest groups would have to work harder, both pass to the legisla- 9 7 tion and to ensure that it survived judicial review. To avoid judi- cial narrowing, concentrated benefit, distributed cost laws would have to be drafted with greater detail. To avoid judicial enforce- ment of public-regarding purposes, distributed benefit, concen- trated cost laws would have to be drafted or amended to protect interest group capture more openly and explicitly. All this extra detail and explicitness would expose the legislation to greater op- position and risk of defeat, because the public, or other groups, would better be alerted to the costs raised by legislation.", Such laws could less easily be sold to an unwitting legislature/populace as public interest measures. And even with more explicit drafting, a private-regarding bargain might still be nullified, forcing the in- terest group to start all over again. The effect of all this would be raise to the overall costs of rent-seeking legislation-drafting and lobbying costs as well the as risk of total defeat in either the legis- lature or the courts-to groups seeking a slice of the public pie. Because interest groups seeking rents will generally not spend more than the anticipated reward in order to obtain the statutes they desire, raising the costs of such statutes would discourage some rent-seeking legislation, though obviously not all of it. Second, one would expect more litigation over statutory issues if federal courts openly abandoned the archeological approach. Inter- pretation of statute-once a it had broken free of its archeological framework-could substantially reshape the statute's meaning over time. Interest groups would have every incentive to litigate aggres- sively, in the hopes of reshaping the statute in their favor. This 97 See Macey, Public-Regarding Legislation, supra note 8, at 224-25. Compare Easter- brook, Statutes' Domains, supra note (favoring 6 narrow interpretation of rent-seeking stat- utes) with R. Posner, supra note 5, at 292-93 (opposing Easterbrook's position because, by limiting statutes' scopes and lives, it would "make Congress work twice hard as to pass laws"). 98 Professor Gary Becker, in Public Policies, Pressure Groups and Dead Weight Costs, 28 J. Pub. Econ. 329, 330-36 (1985), sets forth a model of competition among interest groups for political influence, in which perceived deadweight costs generated by rent-seeking will tend to stimulate opposition taxpayers by and other interest groups. HeinOnline -- 74 Va. L. Rev. 310 1988

38 Statutory Interpretation 19881 some have Distributed benefit, distributed positive might effects. develop statutes Concentrated ben- cost more would expeditiously. might further discouraged, be- cost distributed efit, statutes be litigation extra the cause would their raise cost even more. Unfortunately, this phenomenon have also effects. would ill Or- ganized had the in that lost groups have process political would their incentives to take The battles to court. resulting of storm liti- gation away would draw and-given resources societial ac- the the knowledged in certain institutional disadvantages of courts contexts-misplace that some issues in Con- are handled better bypass agencies. groups might even the Congress al- or gress Some together, and courts urge create special the to them exceptions for distributed even in statutes. benefit The affirmative of proponents Civil action, when the for Rights Act of example, did not prevail but 1964 won their point through creative judi- was written, later 99 cial of interpretation the the described For statute. reasons in the however, previous ought generally to be able to re- Section, courts sist to this impulse statutes. carve up expect Third, would one non-rent-seeking diminishment some of legislation spillover effect of adopting as a approach dynamic a to statutory interpretation. all Not distributed concentrated benefit, legislation cost is rent-seeking, but is hard to distinguish be- it tween what what is not. is and are the For example, various civil rent-seeking? laws rights of their provisions provide Many concen- well-organized racial or ethnic groups and are trated benefits to 100 hand, terms. in On the other efficiency the civil to justify hard rights effort to laws' long-term large but unmeasurable reduce the costs discrimination suggests of that reasons public-regarding of ef- ficiency as justice may well as social as public goods. justify them explicit The the intermediate, adoption of approach dynamic broader would, courts to then, choices, but broader uncer- open the raise turn, in would, the Uncertainty courts within as tainty, well. e.g., United 91 See, Steelworkers v. Weber, 443 193 U.S. (1979). Easterbrook, e.g., 100 See, note 6, at 56 & n.141. Foreword, supra minority set-aside The the Public Works provision the in of 1977, § 103(f)(2), Employment Act § U.S.C. 42 6705(f)(2) (1982), has received some attention this respect. See Fullilove v. Klutznick, in 448 U.S. (1980) (Stevens, J., dissenting) (the minority set-aside "creates monopoly priv- 532 448, a ileges in $400 for market class of investors million a solely by racial characteris- defined W. Eskridge tics"); P. Frickey, supra note 51, at 354-58 & history of the set- (legislative aside). HeinOnline -- 74 Va. L. Rev. 311 1988

39 Virginia Law Review [Vol. 74:275 be litigation the courts groped toward costs: protracted would as answer an on each issue. Overall possibly of costs rent-seeking pro- posals, therefore, might be increased somewhat, thereby making harder them to enact. Potentially more (but important in- wholly determinate) be would the that effect a approach dynamic judi- to cial would interpretation Congress' have on willingness to legislate distributed benefit might Congress laws. well reluctant more be to such enact laws, less could it because easily predict courts what would the other do with them. On as is hand, it just possible that Congress would to continue for enact them same the reason con- it to tinues delegate enormous lawmaking authority agencies: to members Congress of claim could done have to something con- structive, but shifting by decisions political to another branch, offending avoid they would those groups that ultimately lost the political battle. This theoretical analysis suggests the that approach dynamic to yield ought less rent-seeking activity general, in but at an inde- terminate The cost. cost not would substantial, be likely for a sim- practical ple reason: federal courts already interpret statutes dy- namically many in cases, with no discernible ill effects. For example, now commonplace it is Court to for the Supreme inter- phrased distributed generally pret benefit, distributed stat- cost utes-the Sherman Act, section 1983, habeas corpus law-in a 011 common fashion. law The one Court or the of concurring Jus- tices sometimes is open quite poor the about fit between the interpretation Court's of statutes such and any original legislative 02 expectations. Notwithstanding this extensive, and relatively open, lawmaking, judicial there has been cry hue no and among legislators or interest to groups stop Members it. of Congress seem happy enough that Court is the many making policy hard judg- in gaps ments and filling open-ended found in these statutes. "'1 e.g., v. Smith See, Ct. Murray, 106 S. (habeas (1986) 2661 corpus); Pembaur of v. City U.S. 475 Cincinnati, 469 (§ (1986) Southern 1983); Motor Carriers Rate v. Conference United 471 States, U.S. 48 (1985) (Sherman Jefferson Act); Pharmaceuticals County Ass'n v. Abbott Laboratories, (1983) U.S. 460 150 (Robinson-Patman American Act); Soc'y of Eng'rs Hydrolevel v. Mechanical 556 (1982) Corp., 456 U.S. (Sherman v. Piphus, Carey Act); 247 (1978) (§ 1983). 435 U.S. 102 e.g., See, Murray S. v. Carrier, 106 (1986) 2639, Ct. 2653-55 (Stevens, J., concurring); Pembaur v. Cincinnati, 475 U.S. 469, 487 n.1 City of J., United concurring); (1986) (Stevens, States v. United States Gypsum U.S. 422, Co., 438 (1978) 438-39 (Burger, C.J.). HeinOnline -- 74 Va. L. Rev. 312 1988

40 313 Statutory Interpretation 19881 in Court goes out of its way to impose some the Similarly, areas concentrated benefit, distributed on interpretation a narrowing most the antitrust notably exemptions special to cost measures, 10 3 to laws. that believe Court's aggressive There is little reason the antitrust against stance has curbed exemptions useful legislative moreover, may have discouraged in- activity; the Court's hostility, such groups in the first place. In terest from seeking exemptions of benefit, concen- interpretation distributed contrast, the Court's all but impossible to characterize, beyond trated cost statutes is any regulatory agency usually gets its that conclusion bland the however, been an array of decisions opening up way. There has, procedurally administrative overturning errant the process and public purposes. the Court's law- departures agency from Again, no have in Congress. activities great making stir caused routinely does Court The not public choice consider conse- construes quences when it statutes fault would (I the for Court of its decisions reflect an implicit awareness of this), but many and dysfunctions willingness to interpret statutes public choice a mark significant departure for the Court would dynamically. It a the archeological rhetoric that still domi- to abandon completely statutory interpretation. change would hardly be one nates its The bestir to Congress interest groups, and for, even if the intermedi- approach were adopted, Congress and interest groups ate, dynamic count still to enforce clear statutory language when could on courts supportive legislative On the other hand, if up backed by history. the the to a free inquiry approach, all conse- the Court went way even quences would be less My predictable. guess the that is if statutory language and history to Court consistently disregarded of Lochnerism would surface, and inter- curb rent-seeking, charges seek have statutory controversies resolved by would to est groups Union Labor Life Ins. Co. v. Pireno, 458 U.S. 103 (1982) (interpretation of See, e.g., 119 for of insurance"); Arizona v. "business County Medical Soc'y, exception statutory Maricopa 332, 354-55 (1982) (only Congress should create special exemptions to antitrust 457 U.S. Life Group Ins. Co. v. Royal Drug Co., 440 U.S. 205 (1979) (narrow inter- laws); & Health of Mktg. National Broiler "business Ass'n v. United States, 436 pretation of insurance"); farmers). (1978) of statutory exemption for interpretation For other exam- 816 U.S. (narrow arguably rent-seeking statutes the Court has interpreted narrowly, see, e.g., Silkwood ples of Western Corp., 238 (1984) (Atomic Energy Act of 1954); Watt v. U.S. v. 464 Kerr-McGee Nuclear, 462 U.S. 36 (1983) (Stock-Raising Inc., of 1916); Pacific Homestead Act Gas & 461 State Energy Resources Conservation & Dev. Comm'n, Co. U.S. 190, 220-23 Elec. v. (1983) (Atomic Energy Act). HeinOnline -- 74 Va. L. Rev. 313 1988

41 314 Virginia Review Law [Vol. 74:275 means, other unreviewable as such agency action or arbitration. reduction The rent-seeking, in though welcome, would therefore not likely political the justify turmoil would that or sooner later accompany adoption inquiry free of a approach. C. Rules Statutory of Interpretation the and Overall Opera- tion of Our System Political third A focuses inquiry on the of creative a role judiciary within our system. political recent a In lecture, Professor Jerry Mashaw argued a that public choice theorist who accepts legislative supremacy will take view a rigid statutory of interpretation greatly 1 0 4 at with odds judicial creativity. a theorist Such ought take a to narrowly positivist of law, view emphasize the formal literal of text statutes, be and distinctly reluctant to extend the reach of statutes gap-filling, by judicial Mashaw Indeed, argued. of most the initial wave of influential public choice theorists who have about written statutory interpretation-Judge Posner, Professor Buchanan, and Easterbrook-have Judge tended toward positivism, formalism, or literalism. But this phenomenon not is inevitable. The work of Judge for Posner, has example, away moved this triad from of vir- tues, and younger scholars using public choice theory to talk about statutory interpretation-Professors Farber, Frickey, and Macey, and I-do not Mashaw fit the description as as well pioneers the do. The reason for this derives differing from normative assump- tions political about our system. early of scholars The wave ac- the cepted assumption normative that government is, should and be, just the of interest sum group politics. For even example, celebrated though the Landes Posner and explaining model the of importance an independent to judiciary the functioning of inter- 10 5 est group only politics is model, a positive public choice writers 10 often treat the argument normative a as one. The new wave of '0' J. Positive Mashaw, and Theory at 24-26 Public Law, Lectures, (Rosenthal Northwest- Law Univ. ern (draft School) Feb. 1986) (copy on with the Virginia file Law Review Association). 115 See Landes & Posner, supra note 65, at 894 of the (purpose model is to show how an independent judiciary can be defended an "as essential component in a system interest- of group politics"). 106 E.g., Macey, Public-Regarding Legislation, supra note 8, at 233-34 (describing the Landes and Posner model as one accepting the Constitution as "designed to promote inter- est group domination of the legislative process"). HeinOnline -- 74 Va. L. Rev. 314 1988

42 315 Statutory Interpretation 19881 scholars finds anomalous it that anyone positive whose vision of interest group government so is pessimistic should be willing ac- to cept the normative proposition that interest group government is we all should aspire toward. Just Buchanan as and Tullock have argued that public choice dysfunctions might be combated through 1 7 0 restructuring government decisionmaking rules, we believe that more a aggressive approach to statutory interpretation can amelio- these rate dysfunctions. Does public choice theory give us insights any into this norma- tive debate? think I it does. To understand how the earlier public choice scholars could readily so accept normative pluralism, one can distinguish two different goals the of political market. The im- mediate goal of a political market may be rational policy, but the longer-range goal of a pluralist system is often defined as modera- 1 8 tion and stability. From the long-range perspective, is it not so important that fair results emerge from the political process. Rather, a pluralist might contend that is it more important that all politically salient groups engage in peaceful the political game. This vision of politics certainly militates against accepting the free inquiry model statutory of interpretation. If legislative deals among interest groups, or victories for some groups, were not en- forced the by courts, groups would have much incentive less to en- gage in the stability-enhancing pluralist game. Though many groups would simply transpose the game to the courts, others would drop out and engage in destabilizing activity. This is the pluralist nightmare. If completely accepted, argument this might support the archeo- logical approach to statutory interpretation. But one cannot accept such an argument without making many controversial historical and political assumptions. To begin with, the historical case for this sort commitment of to a strong form of stability-enhancing pluralism has not been made. There always have been powerfully antipluralist strains American in politics, and modern constitu- tional scholars argue that the tradition republican of government committed to deliberative rational policy is just as strong tradi- a J7 j. Buchanan & G. Tullock, supra note 31, at 283-95. 108 Miller, See Pluralism and Social Choice, 77 Am. Pol. Rev. Sci. 734, 734-38 (1983). HeinOnline -- 74 Va. L. Rev. 315 1988

43 Virginia Law Review [Vol. 74:275 109 tion as the pluralist one. Recall that framers the of the Constitu- tion, particularly authors the The of Federalist, were highly am- 1 1 bivalent about role the of "factions." In Federalist the No. 10, Madison accepted inevitability the of factions but argued that their pernicious influence could contained be by deliberative legis- lative procedures. Although Madison did not talk much about the role courts of dealing in with factions, his colleague Alexander Hamilton did. Hamilton, in the Federalist No. argued 78, that the judiciary ought to serve as a check on factions, by "mitigating the severity and confining the operation of [unjust and partial] laws. It only not serves moderate to the immediate mischiefs of those which have been passed it but operates as check a upon the legisla- body tive in passing them. . .. political In and philosophical circles, strong a form of pluralism is hardly uncontroversial. Its philosophical roots in nineteenth-cen- tury atomistic liberalism render it vulnerable now that more com- 2 munity-oriented visions our of polity have emerged." Most impor- tantly, strong pluralism's emphasis on stability over rational policy represents a value-packed choice-favoring existing power and property arrangements over social restructuring, the status quo 13 over reform, and on. so Interestingly, public choice theory itself has a contribution to offer to this value debate. Professor Olson has recently advanced the thesis that interest group government explains economic the decline the of United States and those other developed countries that have had stable democracies for long a time."" In any given country, interest 109 See J.G.A. Pocock, The Machiavellian Moment: Florentine Political Thought and the Atlantic Republican Tradition 462-506 (1975); Ackerman, supra note 11, 1025-72; at Michelman, The Supreme Court, 1985 Term-Foreword: Traces of Self-Government, 100 Harv. 17-55 L. 4, Rev. (1986). 110 See generally D. Epstein, supra note 11. The Federalist No. at 78, 470 (A. Hamilton) Rossiter (C. ed. 1961). See '2 M. Sandel, Liberalism and Limits the of Justice (1982) (communitarianism); Michelman, note supra 109 (republicanism). 13 See The of Bias Pluralism (W. Connolly ed. Cunningham, 1969); Pluralism Class and Struggle, Sci. 39 & Soc'y (1975-76). 385 Even many pluralist thinkers reject the strong ver- sion of the theory these for reasons. See, R. e.g., Dilemmas Dahl, of Pluralist Democracy 40- 43 (1982). " Olson published the thesis book, a as The Rise and Decline of Nations: Economic Growth, Stagflation, Social and Rigidities (1982), but the thesis circulated as an unpub- lished paper for several before years that. The paper was the subject symposium, of a the results of which were published as The Political Economy of Growth (D. Mueller 1983) ed. [hereinafter Economy of Growth]. HeinOnline -- 74 Va. L. Rev. 316 1988

44 317 Statutory Interpretation 1988] groups asymmetrically, will form which that means interests the of will many unrepresented go by any organized group, the that and groups that will form have do varying widely degrees political of influence. Stable societies unchanged with boundaries-such the as United States-tend to accumulate interest more groups and inter- coalitions est group time. over This has consequences disastrous for the because society, the proliferation of interest group activity (1) confers benefits well-organized on at groups expense the the of often public, reallocating resources to inefficient uses; deflects (2) attention society's productive from endeavors to efforts to partici- pate in distributional politics; contributes and (3) to cumbersome which regulations, over time impede innovation by both discourag- ing the development of new technology and by raising barriers to the efficient diffusion of technology. Olson argues this that is what now is occurring the in United States, this that and main is the reason West and Japan (whose Germany interest group structures were wiped out World in War II) have shown higher growth rates in the last twenty years. Olson's has thesis a generated deal great of controversy. Some scholars object exaggerates that Olson the rent-seeking features of 11 5 government the in United States, while others contend that his 6 explanation is unpersuasively unidimensional." the On other hand, there is empirical support for general his proposition that a 17 stable interest group society a not is one.1 healthy very At the See "I Becker, supra at 98, note 344-45 (there competition more is among interest groups admits, Olson than large subsidies and to groups taxpayer stimulate will resistance). example, "' For there societal be may cultural and reasons for Japan's and Germany's economic success (both countries were industrializing the before rapidly that cannot be war) rigorously tested. 117 Particularly strong support can be found in Weede, Democracy, Creeping Socialism, Ideological and Socialism in Rent-Seeking Societies, Pub. Choice 44 349 (1984). Other em- pirical supporting tests Olson's thesis include Statistical A Choi, Test of Olson's in Model, Economy of Growth, supra note 114, at 57; Maitland, Interest Groups and Economic Growth Pol. 47 Rates, J. Murrell, (1985); 44 The Comparative the Structure of of Growth the West and German British Manufacturing in Industries, Growth, of Economy note supra Murrell, 109; at 114, Examination An of the Factors Formation the Affecting of Interest Groups in Countries, OECD Pub. 43 151 Choice test A (1984). supporting not Olson's thesis can found Pryor, be in Quasi-test A of Hypotheses, Olson's in Economy of Growth, supra note 90. at 114, Tests refined a suggesting version of Olson's Asselain include thesis & Mor- risson, Economic Growth and Interest Groups: The French Experience, in Economy of Growth, supra note 157; at 114, Lehner, Pressure Politics and Economic Growth: Olson's Theory and Experience, the Swiss Economy in of Growth, supra note 114, at 203. HeinOnline -- 74 Va. L. Rev. 317 1988

45 318 Virginia Review [Vol. 74:275 Law Olson's thesis least, pluralism normative places It defensive. on the normative some the explores of consequences of public choice the- and turns the case for pluralism ory's itself. gloomy vision against Rather than good, being unalloyed an to shown the is stability be seed of society's decay. A is not vibrant society that one sacrifices everything for stability and, it apparently, that one not is uncriti- cally accepts pluralist premises. choice indictment The public strong the of of form is, pluralism of many-edged a course, It discredit sword. may the archeological to statutory approach but interpretation, provides it good equally adopt the free inquiry approach, in which rent-seeking reasons to simply are statutes favor of the in ignored If law. common legisla- administrative tive and presumptively rules are rent-seeking, why get rid of them, root and branch? This public choice position is not logical as it is radical, but thus far only Professor Richard Ep- as 1 18 stein has it in the legal broached literature. other Perhaps public choice thinkers reluctant to compromise are political our traditions drastically, suggesting that that pluralist values of stability, the moderation, and so forth are not easily abandoned. (Note that, though Olson not treat Third does countries in World any detailed one political way, lesson that chronic is there learned instability can be yet to a polity more deadly stability.) than stagnating do the choice lines In inquiry public not give us summary, of answers about the definite "optimal" approach statutory to inter- pretation, do offer three they but if tentative, even interesting, First, public choice theory provides quite substantial conclusions. justification for efforts to address the first legislative dys- judicial problem of function-the statutory updating-by following a com- mon law approach to distributed benefit, distributed cost statutes. Second, theory provides public choice equivocal, though some, evi- dence that courts can ameliorate second dysfunction the by nar- rowly interpreting rent-seeking statutes and by adopting public-re- garding interpretations of regulatory statutes. Third, public choice theory suggests that' more judicial lawmaking will change the dy- can namics political system, probably not in ways that our be of 18 See R. Epstein, Takings: Private Property and the Power of Eminent Domain (1985); Epstein, Toward a Revitalization of the Contract Clause, 51 U. Chi. L. Rev. 703, 711-15 (1984). HeinOnline -- 74 Va. L. Rev. 318 1988

46 Statutory Interpretation 1988] precisely anticipated or measured. But our if polity preserve to is its vitality, this a set is risks of we ought to willing be to assume. III. PUBLIC CHOICE WITHOUT ROMANCE: STILL ANY IMPLICATIONS FOR STATUTORY INTERPRETATION? Thus far, the argument has been that the dreary picture of stat- utory law painted public by choice theory be can brightened-at least somewhat-by adopting an approach statutory to interpreta- tion oriented more toward current policies and problems. For many the of same reasons, public choice theory provides some ten- tative arguments against any purely archeological approach stat- to utory interpretation. The discussion has been premised upon the assumption that public choice theory offers an accurate vision of legislation, which can be usefully deployed by legal scholars and judges. This may what be economists a call "strong" (i.e., unrealis- tic) assumption. The critics of public choice contend that the- its ory (if hard is not impossible) to determinatively, use that offers it an inaccurate vision of society, and that it can be deeply 11 9 misleading. First (the critics urge), the public choice theorists have over- stated their claim politics that can be reduced kind to a of exact "science." Although public choice articles are replete with magic mathematics and deductive analytics, critics the contend that the analyses are not rigorous as as appear they to be. For example, the central concept of "rent-seeking" is very fuzzy in its application. Not all legislation sought by interest groups is, in fact, rent-seek- ing. The railroads' exemption from antitrust regulation may be rent-seeking, it for frees an industry to form price cartels. But the exemption may instead be an efficient rule (as the industry ar- gues), because railroads need to exchange price information or- in der to have a unified national set of rates. Conversely, though laws that protect the environment appear be to public goods rules, if they "too go far" may they simply be the product of rent-seeking by who elites are imposing the costs of their enjoyment of envi- the ronment on others, outside the elite group. As these examples show, clever economists can almost always devise arguments for or against any measure. How, then, are lawyers and judges, with only "19 See, e.g., S. Kelman, Making Public Policy: A Hopeful View of American Government 234-39 (1987); Farber & Frickey, Jurisprudence The of Public 65 Choice, Tex. L. 873, Rev. (1987); 901-06 J. Mashaw, supra note 104. HeinOnline -- 74 Va. L. Rev. 319 1988

47 [Vol. 74:275 Virginia Law Review choice apply public to of economics, understanding rudimentary a models? that premise choice the public that charge critics the Second, reelection- between of transactions is just series a legislation groups is oversim- interest private-seeking and legislators minded by influenced behavior is side, legislators' supply the plified. On legisla- Though to be reelected. desire raw the than other factors process institutional reelected, be to strong incentives do have tors rich a by influenced also is behavior legislators' that argue scholars sound to contribute to desire their including factors, other array of 1 2 to the Contrary legislature. the respect within gain to policy and been have scholars many assumptions, theorists' choice public the in spirit" "public and of ideology significance by the struck 12 1 study the most comprehensive demand side, On the legislature. on legislation influence that their concluded interest groups of upon depending "insignificant," to "determinative" from ranged 2 2 of studies Case working. were the groups which in context the the (especially public figures that found have generally legislation groups private interest than important more are much President) 3 2 1 agenda. political nation's the setting in their criticism is that this to response theorists' choice Public superior yields it if premises simplified with away can get theory 25 2 not. does it say that however, critics, The ' results. predictive explana- reasonable to be a seems theory public choice Although expla- a satisfying is less Tariff it Act, for the tion Smoot-Hawley the Civil including developments, statutory recent many nation for 1970's and of the movement deregulation the 1964, Act of Rights (most re- and statutes, law environmental of the evolution 1980's, 888-90. 119, at Frickey, supra note see Farber & 1; at note supra 43, Fenno, 120 R. the Common Congress and Maass, at 58-66; A. supra note 119, S. e.g., Kelman, See, 121 (1984). Good (1986). Democracy 317 and American Organized Interests Tierney, Schlozman & J. K. 122 when influential most be tend to interest groups that concluded study the authors of The and public issues low have the legislation, (2) block enact than rather to are trying they (1) they (3) and can groups, to the forums in friendly being are addressed and media visibility figures. key and/or political relevant groups, other public sentiment, support from on count 314-17. Id. at 72-74 (1984). Policies and Public Alternatives, Agendas, See J. Kingdon, 12 5 (1979). Public Choice D. 124 See Mueller, Legisla- of Models Panning, Formal at 895-901; 119, note supra Frickey, & 125 See Farber & M. Loewenberg, S. Patterson Research 669 (G. of Legislative Handbook in Processes, tive 1985). eds. Jewell HeinOnline -- 74 Va. L. Rev. 320 1988

48 Statutory Interpretation 19881 dramatically) and reform enacted in 1986.126 Public the cently tax choice theory is strikingly insufficient its in ability to explain why these statutes were enacted all: at the Civil Rights Act passed was legislators by who faced great electoral risks in voting for such a strong and sweeping law, deregulation flew in the face of public choice arguments that regulated groups will continue receive to protection, and the environmental and tax reform statutes were opposed by classic the array omnipotent of interest groups. In each case, ideological and historical factors seem essential to an under- standing what of happened. Public choice theory is only part of the overall story. Building on the two, first the criticism third of public choice the- ory is that its of view politics as simple a marketplace distorts analysis by implicitly denying the capacity of and law politics to 12 7 articulate national values and to transform preferences. The Civil Rights Act can analyzed be public in choice terms, either as a measure intended to eliminate inefficiencies the caused by discrim- ination, or rent-seeking a as measure that benefits various minori- ties. But this mechanistic view trivializes the Act, its for enactment and subsequent history are incomprehensible without under- an standing how of our society transformed was by the public debate. This is not only positively true, but normatively important. By an- alyzing the political process as a relatively narrow calculus in which individuals seek only their own advantage, public choice may imperil the fragile norm of "public spirit" that informs vig- a 2 8 orous politic. body The realistic most view of politics may be one ... anti-public For choice theory accounts of these statutes, accounts that emphasize the importance public of opinion, personalities, historical accident, and deliberative debate, see Birnbaum J. A. & Murray, Showdown Gucci at Gulch: Lawmakers, Lobbyists, and the Un- likely Triumph of Tax Reform (Tax (1987) Reform of Act J. 1986); Kingdon, note supra 123, at 9-13 (deregulation measures the in 1970's); late B. Whalen & C. Whalen, supra note 51 (Civil Rights Act); Elliott, Ackerman Millian, & Toward a Theory Statutory of Evolution: The Federalization of Environmental Law, Econ. J.L. 1 & Org. 313, 333-35 (1985) (clean air legislation). 227 See Sunstein, Legal Interference with Private Preferences, 53 U. Chi. L. Rev. 1129 (1986); Mashaw, J. supra 104. note 128 Compare Kelman, "Public Choice" and Public Spirit, Pub. Interest, Spring 1987, at 80, 93-94 ("Cynical descriptive conclusions about behavior in government threaten to under- mine the norm prescribing spirit.") public with Brennan Buchanan, & Is Public Choice Im- moral? Case The the for "Nobel" Lie, Va. 74 Rev. 179 L. (1988) (defending public choice as more realistic than a public-spirited of view governance). See also J. Mashaw, supra note 104, 3-4 at ("Beliefs about states of the world and about the possibilities for molding human conduct influence, just not we how our pursue but what ends, we ends choose."). HeinOnline -- 74 Va. L. Rev. 321 1988

49 [Vol. 74:275 Law Review Virginia which people in both selfish and public-spirited ways, and in in act at (and perhaps but also issues interest, of involves which politics the possibil- denies Any theory that same of value. the issues time) reality. obscures behaviors of both ity that critics public choice the- I part, agree with the the For most us an incomplete view of the legislative process. The the- ory gives however, does, an interesting analytic for understand- ory provide and evaluating strategies for improving it. legislation, ing for theory offers a useful way to think about legislation, Public choice its worst (or what I con- is process at shows the because precisely often public-regarding in actors act its public Though worst). sider and historical/ideological factors play ways, decisive role in shap- a ing passing legislation, a great deal of what goes on in the leg- and process is succinctly and horrifically by public islative captured makes and where, what can go wrong, on Its theory. choice focus beacon to judicial inter- theory an excellent warning choice public by dysfunctions identified Indeed, the primary legislative preters. choice theory-a tendency of Congress to neglect general in- public statutes of terest Congress and agencies to create special rules and benefits groups-are borne out by more well-organized for and 12 9 studies and theories. traditional institutional process up- and spend too little time enacting public choice notion that legislatures the Thus, 129 can supported statutes garbage Kingdon's is by benefit, cost distributed distributed dating theory. See J. Kingdon, supra note 123, at 89-94 (citing Cohen, March & Olson, A Garbage Can Model Choice, 17 Admin. Sci. Q. 1 (1972)). Because the legislature is of Organizational a general public problem be accomplished only when will anarchy," "organized things an salient at the same time that a becomes solution is available and politically well-considered political is ripe for change. Although climate is optimistic that the legislature the Kingdon the common good in these statutes, his theory suggests that the legislature will not, seeks emphasize Other See id. institutional theorists function often. cannot, very perform this and structure hurdles the generally decentralized power and in the legislature, the procedural prevent the legislature from acting frequently to address general public problems which Oleszek, Congress W. See, e.g., R. Davidson & policy integrated solutions. up-to-date with and Process Congress: R. Ripley, 1985) (procedural obstacles); (2d ed. Members Its and 4-21 1983) (decentralized nature of Congress). ed. (3d Policy supports the public choice insights that legislatures will often avoid Institutional theory favor in of regulated biased choices (which may become to agencies political defer or hard of expense the at groups distribute advantages to often that groups), will legislatures and decentralized the that argue Franklin Grace Ripley and Randall public. the Scholars as such legislative decisionmaking has encouraged policymaking by "subgovernments" nature of in par- groups interested and lobbying legislators, bureaucrats, subcommittee consisting of Policy Public and Bureaucracy 9- the Franklin, G. & Ripley Congress, R. ticular issues. See which 12, (3d ed. 1984). Routine legislation (in 55-66 the President, the media, and political HeinOnline -- 74 Va. L. Rev. 322 1988

50 Statutory Interpretation 1988] the in Hence, complicated of world interpretation, statutory choice public can theory help to alert the interpreter to problems, if provide does not it even theory complete a of An interpretation. analogy is appeals that to me the light lighthouse. Its beacon can- itself, not, of harbor, to the bring sailor and illumi- but location its nation and dangers the mark shoals navigator. the for experienced Public choice the for that does theory judicial interpreter-alerting her to possible and biases inequities in statutory the scheme and to the of various consequences options. interpretational short, In rather than general engendering any of interpreta- theory statutory tion, choice public theory at is most present to interpreters useful as a perspective that can creative guide statutory interpretation dangers. obvious away from Public source choice is one for intelli- gent inquiry, judicial theory. determinative a not of the in- Some which quiries for theory choice public has are the useful insights following: Is the statute one that the legislature likely is update? to a If statute is created result a as of public-spirited a response a per- to ceived social or economic problem, and it distributes benefits the legislature widely, well may neglect over statute time, the implicating thereby interstitial, facilitating the role of the judici- ary. the other On hand, a statute creating or benefits concentrated concentrated imposing likely to is costs more this be amended; type of statute is not therefore as likely to judicial require updat- ing. Thus, might judges willing more be update to a common (in fashion) a law distributed benefit, distributed the like law cost Sherman the Uniform Act or Commercial Code, a concen- but not concentrated benefit, trated like the National cost one Rela- Labor tions Act. Does statute entail symmetrical the and rights duties, or bene- and costs? fits Symmetrical rights/duties benefits/costs or evi- are legislative dence that the reasonably worked process has well; the function Hamiltonian checking judiciary of not, the is impli- then, cated. Asymmetrical rights/duties or benefits/costs, on the other do not become actively parties is effectively controlled involved) these by subgovernments, time to push government which tend over their favored policy toward interests. Legislation that is more public-benefiting will typically compromises reflect these with subgovernments and delegation of future policymaking responsibilities them, often with a similar eventual to result. HeinOnline -- 74 Va. L. Rev. 323 1988

51 Virginia Law Review [Vol. 74:275 judges should statute that may represent advan- hand, to alert a tage-taking: should judges consider the possibility interpreting of such narrowly statutes (especially the if law concentrated entails and benefits costs) distributed according or elastic to an public- regarding purpose (for laws imposing distributed benefits and con- centrated The same costs). inquiry judges useful be might when are responding interpretations agency to of regulatory statutes. Does the agency's interpretation expand special subsidies or self- regulation the beyond statutory original entitlement? Does the interpretation agency's undercut the public-regarding justifications the for If statute? so, might judges less be deferential to the agency's interpretations. Will one interpretation statute of the penalize who people have effective no the access to political process? whatever In manner a court interprets a with statute concentrated benefits costs, and the losing often side obtain may legislative reconsideration of the what court has This done. useful. seems possibility The legislative of re- consideration substantially is less, however, if the court's interpre- tation hurts group diffuse a (such consumers). or taxpayers as Public theory choice does thus the courts afford direction, some though complexities the dynamics of the of government mean that public a choice analysis used should be beacon, a as a of warning danger, rather than as a determinative statutory guide to interpre- light tation. In this more of role limited public choice of theory, the simple approach discussed in Part sufficient. II is not Table 3 outlines below the dangers and consequences entailed differ- in the of types ent statutes outlined and Part offers in I, suggestions about judicial strategies that might be considered. remainder The this of indicates Part the how public choice perspective might have illuminated the statutory in analysis three recent decisions. judicial case In each was result the and curious methodology the curiouser. Had the Court in each case considered the highlighted dangers by public choice theory, it would have approached the statutes in question differently, satisfactorily. more and HeinOnline -- 74 Va. L. Rev. 324 1988

52 325 Statutory Interpretation 19881 3 TABLE DYNAMIC STATUTORY INTERPRETATION (REVISED "LIGHTHOUSE" VERSION) Distributed benefit/ Distributed benefit/ cost distributed concentrated cost Danger: The legislature's fail- Danger: Regulated groups' to ure the update society as law evasion of duties; agencies as and the underlying problem "captured" are groups, by regu- change. becomes lation means a ex- to Response: Courts can help clude competition. maintain a statute's usefulness Response: Courts can monitor by expanding to it situa- new agency enforcement and private tions and by developing the compliance, and open can up statute in common law fashion. procedures to allow excluded Caveat: Courts should be re- groups to be heard. Courts create to luctant special excep- seek should the make to origi- tions organized for groups. nal work. goal public Concentrated benefit/ Concentrated benefit/ distributed cost concentrated cost spe- by Rent-seeking Danger: The statutory "deal" Danger: cial interest the at groups, ex- often grows unexpectedly lop- the of pense general public. over sided time. Response: Courts can nar- Response: Courts fine- can construe rowly the statute to the tune statutory arrangement minimize the benefits. Courts to reflect new circumstances. should err in favor of stinginess Caveat: Err against very much with public largesse. updating, judicial unless af- Caveat: stinginess Rule of not fected groups systematically are applicable statute if really unable get to legislative atten- serves a public purpose. tion. HeinOnline -- 74 Va. L. Rev. 325 1988

53 Virginia Law Review [Vol. 74:275 Case The A. Checkerboard In Montana Wilderness Association v. United Forest States 130 Service, United the States Court Appeals of Ninth the for Cir- cuit section interpreted the 1323(a) National of Alaska Interest Conservation Lands Act (Alaska Lands) of 1980.131 The provision assures that the Secretary Agriculture of "shall provide access such to nonfederally owned land the within boundaries the of National Forest System the Secretary as adequate deems to secure the to 3 2 owner reasonable the use and enjoyment thereof.' This provi- sion a was response land to federal policy in century. last the In the nineteenth much century, land federal distributed was to pri- vate parties, frequently return in public a for service as (such the building transcontinental railroad). The resulting configuration was a "checkerboard" often pattern, which in federal land alter- with nated private land, creating thereby mutual For enclosure. al- most one years, hundred Departments the of Agriculture and the Interior, which federal managed and forest lands public (respec- tively), granted routinely checkerboard private holders of rights ac- cess across federal land, and expected private holders give to the government access 1979, well. as In however, the Supreme Court that held the federal did government a have not general common law right statutory or of access through private checkerboard par- 13 3 and cels, Attorney the General in interpreted 1980 Court's the decision right to deny private holders a federal through access of checkerboard parcels well." as Section 1323(a) clearly made the Attorney General's inapplicable opinion to federal checkerboard forest lands in Alaska. in issue The Wilderness Montana was whether statutory the also abrogation to applies all forest national lands. Ninth The Circuit held it that does. language The structure and suggest statute the of section that 1323(a) is limited to Alaska only lands. Not are the all other provi- 655 130 F.2d Cir. 1981), (9th 951 455 cert. denied, (1982). 989 U.S. earlier There an is opinion other the out coming No. way, 80-3374 Cir. (9th May 1981), 14, was which with- by drawn the court. I was for intervening on brief an defendant party this in case. 1s Pub. L. Stat. 2371 (codified No. 96-487, 94 in scattered sections as amended and 16 of U.S.C.). 43 Alaska Lands 132 Act § 1323(a), 16 U.S.C. 3210(a) § (1982). Sheep Co. v. Leo 133 440 U.S. United States, (1979). 681-82 668, Rights-of-Way 134 Nat'l Forests, Across Op. Att'y 43 26, at Gen. No. 23, (June 17-18 1980). HeinOnline -- 74 Va. L. Rev. 326 1988

54 Interpretation Statutory 1988] the sions to Alaska, but section 1323(b), which is statute of limited with section and applies to "public lands" pari in materia 1323(a) the by administered Department Interior, its of by applies terms 3 5 only Alaska." The Ninth to evidence Circuit believed that this "tentative provided support" section the that for view ap- 1323(a) 6 to Alaskan plies only drawing Nonetheless, lands." on contempo- and raneous subsequent history, legislative that court sec- the held tion 1323(a) applies nationwide. The Circuit noted Ninth that the responsible senator 1323(a) stated section for apply that it would (though nationwide after the remarks his came Con- passed bill 7 1 3 the of and House made similar state- gress), members several 138 body's What of the bill. that during was de- ments consideration the court, cisive for though, subsequent was legislative history. Congress Three weeks after the Alaska Lands passed the Act, con- ference committee Colorado involving act on an wilderness areasS" interpreted apply to 1323 section to therefore Colorado, and de- 140 provision leted a similar act in Colorado the unnecessary. as The Ninth Circuit's interpretation 1323(a) is hardly of section inevitable one; the language statutory tilts the court's the against and interpretation, subsequent in history legislative favor it. of Ninth The written have could Circuit an opinion faithfully invok- 4 meaning ing the ' and wagging its finger against efforts plain rule "15 See 16 U.S.C. § 3210(b) (1982). "Public lands" is defined in 102(3) § of the Act, 16 § 3102(3), to apply U.S.C. to only in Alaska." The lands "situated Forest term "National defined not System" in is the the agreed that to Act. case All parties are §§ 1323(a) and (b) materia-if in pari applies nationwide, so should one the Ass'n, other. Montana Wilderness at 655 F.2d 954. Ass'n, F.2d at 955. Wilderness 1' Montana 655 137 126 Cong. Rec. 30,369-70 (1980) (statement of Sen. Melcher). id. 118 24,911-12 (Rep. Weaver); id. at 29,022-23 (Rep. Seiberling); id. at 29,262-63 See at AuCoin). Udall, (Rep. Representative of interpretation, opponent this an set forth his view at 29,282-83, but the sincerity of his position was undercut when in joined the confer- id. he report the Colorado wilderness act, quoted infra for 140. ence note 39 See Act of 19, Dec. 1980, Pub. L. No. 96-560, 94 Stat. (codified 3265 scattered in sec- U.S.C.); see also 1980 U.S. Code Cong. tions Admin. News (94 Stat.) 3274 (chroni- of 16 & passage of the cling regarding Colorado the act lands). wilderness allowing Colorado originally had a Senate provision bill private access 110 wilderness The through land, but in checkerboard federal conference that was deleted "because lan- similar ha[d] guage already passed Section of the Alaska in 1323 Congress National Interest Lands H.R. Conf. Conservation No. 1521, 96th Cong., 2d Sess. 20 (1980), quoted in Act." Rep. Wilderness Ass'n, 655 F.2d at 957. Montana (1982); See, Griffin v. Oceanic Contractors, Inc., 458 U.S. 564, 570 e.g., TVA v. Hill, "I 437 U.S. 153, 173-74 (1978). HeinOnline -- 74 Va. L. Rev. 327 1988

55 328 Virginia [Vol. 74:275 Law Review 1 42 bring subsequent to in history. legislative not. it Yet did The wrote court an reluctantly opinion enforcing the legislative deal, apparently on the assumption this that what was the majoritarian system somehow "wanted." Given the substantial indeterminacy of Montana Wilderness, the public choice perspective would have most been valuable. Sec- tion a 1323 is concentrated benefit, distributed cost statute, appar- added ently the at behest western of landowning interests. The statute creates asymmetrical rights duties: and private checker- board holders guaranteed have a right access of across government lands, but the government and citizenry its have reciprocal no right. As is often case, the however, is it clear not whether this apparently rent-seeking statute really is inefficient. The statute ar- guably solves a classic bilateral monopoly problem: government the and private a checkerboard holder will both often monopolize a good (here, access) that other the wants. Each monop- can a charge oly to price the other, but has incentive an to bargain to obtain reciprocal bargaining The rights. process can be quite expensive. By setting forth a right access of for holders, private section 1323 probably reduces those transaction costs and facilitates private development land in the West. The statute focuses private on of rights because access most of the government land being not is actively (indeed, used much designated is as "wilderness" land) perhaps, and, because the government has superior a bargaining 14 3 position any in to due event, its power domain. of eminent There three are problems with this story. the First, Departments Agriculture of the and Interior have rarely acted like bilateral mo- nopolists, they because have sympathetic been western to land- owning interests. Even the after Supreme 1979 Court decision de- nying government the guaranteed access across private the checkerboard parcels, the Departments continued the to take posi- that tion private parties had guaranteed rights across govern- the 4 4 ment's parcels.1 Second, in Montana Wilderness, those seeking See, 14 e.g., South Carolina v. 465 Regan, U.S. 367, (1984); 378 n.17 Consumer Prod. Safety GTE v. Comm'n Sylvania, Inc., U.S. 447 102, (1980). 117-18 143 private That is, a could not force holder the government access it grant to the (before was statute whereas passed), the government could-and can-force the holder private to by access grant "taking" the property one Thus right. argue that might just § 1323 was evening bilateral up the positions. bargaining 144 e.g., See, Montana Wilderness Ass'n, F.2d 655 953. at HeinOnline -- 74 Va. L. Rev. 328 1988

56 Statutory Interpretation 1988] not were (the government, in fact, government access officials sided with private the holders in case), the but instead were envi- ronmentalists committed a to vigorous statutory wilderness policy. In last the several years has it in fact been private citizens who have been denied access across private checkerboard lands, or have 145 been forced to pay monopoly prices for such access. Third, a more efficient rule this in situation would probably have been to grant rights of access to private holders if they were willing to grant reciprocal rights across their lands. To sure, be the public choice analysis section of 1323(a) yields clear no analysis about the statute's overall worth, but the asym- metry rights of makes me suspicious. These suspicions are rein- forced by the procedural background of the provision-added at last the minute, apparently at the behest a well-organized of group, without much public a of justification or meaningful any delibera- tion. Such statutes ought to be interpreted narrowly possi- where ble. Nevertheless, although the court might have favored narrow a interpretation of section 1323(a), the Circuit Ninth constrained felt by the archeological evidence supporting a broader reading of the 14 6 statute. Yet a narrow interpretation would have no done dam- and age, would have sent a useful message rent-seekers. to The groups involved could very probably have kept the issue on the legislative agenda, though something as broad would likely not have survived much public scrutiny and debate. the If issue had been deliberated, it seems likely that a more balanced position 47 1 emerged. have would Had the statute been drafted more clearly to nationwide create of rights the access, public choice perspective would have had little to add, for conventional of rules statutory interpretation-with the ambiguity gone-would have dictated only one result. As is often Slocum, See N'B Battle in the West: Public Lacks Much Access to Public as Ranch- Land ers Bar Way, Wall Jan. St. J., 1986, 2, at 1, col. 1. 14' Indeed, court the an issued earlier opinion construing to § 1323 apply only to Alaska lands. supra See 130. note was It the conference committee report to the act regarding Colo- rado wilderness lands, see 327, supra p. impelled that the court to withdraw the original opinion and issue that the one became final. See generally Montana Wilderness 655 Ass'n, F.2d at 957 conference (the report "tip[ped] the balance decidedly in favor of the broader interpretation § of 1323"). M For example, a statute could solve the problem orderly of land development most effi- ciently by assuring private holders of reasonable access they if willing were to grant the government similar rights. HeinOnline -- 74 Va. L. Rev. 329 1988

57 330 Virginia Review [Vol. 74:275 Law case, however, the the substantial court leeway had interpreta- for and the public choice aspects of the have should tion, considered question. reach the issue the Should ought Supreme Court, it to different reach a result. Order Case Milk Review The B. 4 5 In Institute, Block the Supreme v. Community Nutrition Court the judicial review provisions of the narrowly interpreted Marketing Act of 1937.149 Enacted during Agricultural Agreement (which Depression the thought was caused many or prolonged by the statute essentially permits milk low to agree prices), producers minimum on regulate this prices. To the Act authorizes conduct, Secretary of Agriculture to issue the marketing orders" set- "milk ting minimum prices that handlers (who process dairy prod- the 150 must producers (dairy farmers). pay The Secretary does ucts) to one through this of several mechanisms, each of for in- which calls put both and handlers, producers from consent the and of at least 1 51 two groups. one of The the in Community Nutrition lawsuit was brought challenging by consumers refusal Secretary's to the revise in orders issued regulating the sale and 1964 reconstituted (pow- of milk; dered) orders the discouraged effectively the use of powdered as a milk competitive substitute, because they required compensa- tory payments by handlers to producers when purchased handlers 152 milk to powdered for sale Supreme consumers. The unani- Court mously held the Secretary's that subject was decision not judi- to at cial behest of consumers. review the 467 340 (1984). 148 U.S. Ch. 50 Stat. 246 (codified O19 296, amended at 7 U.S.C. §§ as 601-674 (1982 Supp. IV & 1986)). See 7 608c U.S.C. § (1982 IV 1986). & Supp. Secretary must conduct a 151 The proceeding, with public rulemaking and hearing com- ment, before a milk market order. issuing § Id. To be effective, an order 608c(3). not only has to be supported by evidence in the record, id. § 608c(4), but must be approved by the handlers of least 50% of the volume of milk covered by the order and at least two-thirds at the id. producers in the region, of § 608c(5), (8). If the handlers withhold their affected consent, the can still issue the Secretary order, an administrative finding upon that the "order is the only practical means of advancing the interests of the producers." Id. § 608c(9)(B). 152 Complaint 1 23-39, Community Nutrition Institute v. Bergland, Civ. No. 80-3077 (D.D.C. Sept. 29, 1981), rev'd, 698 F.2d 1239 (D.C. Cir. 1983), rev'd, 467 U.S. 340 (1984); see Community Nutrition, 467 U.S. at 344. HeinOnline -- 74 Va. L. Rev. 330 1988

58 19881 Statutory Interpretation The Court started rule the with that judicial is presump- review 1 5 available, tively unless relevant the precludes statute it. The Court noted the Act that contemplates "cooperative a venture" among the Secretary, handlers, nowhere and producers; the does Act consumers formally bring order marketing proceed- the into ings, although statute the does forth set consumer a welfare as gen- 1 5 4 eral purpose of the scheme. Indeed, explicitly the Act allows 55 to handlers judicial seek orders. milk marketing review of Con- sumers are not afforded "In the same right. a of scheme complex this type," the Court reasoned, "the omission a of such provision is sufficient reason that Congress believe to intended to foreclose 5 6 consumer participation in the process." regulatory The Court further noted that creation a new review of mechanism would thwart the for statutory scheme petitions, handler review because 5 7 handlers also could claim be to consumers. event, In any the said Court, consumer preclusion of threaten suits not would the stat- ute's objectives, handlers because have the interest same as con- sumers-"obtaining reliable supplies of milk at possi- the cheapest "I Nutrition, Community at 348-49; 467 U.S. see Dunlop v. Bachowski, 421 560, U.S. 567 (1975); Abbott v. Gardner, Laboratories 136, 387 U.S. (1967). 140-41 This presumption of not as robust as reviewability is it was; Bachowski, in 1975, probably once marked its high- point. Cf. Heckler water Chaney, v. 470 821 (1985) U.S. not (FDA's decision to certain take enforcement actions not subject held to judicial Southern review); v. Seaboard Ry. Allied Milling Corp., 442 U.S. 444 (1979) (ICC decision not to investigate lawfulness of proposed in railroad increase shipping subject rates review); to not judicial 432 Gressette, Morris v. 491 (1977) U.S. (Attorney General's failure to object proposed to a change in voting rules under Rights Act of 1965 the Voting subject was judicial not to review). "It is I' the declared be to of Congress," policy 2 says the § of "[t]o protect Act, the interest of the consumer by approaching (a) the of level which it declared prices is the be to of Congress policy in subsection to establish .. . (b) authorizing no action (1) and which has for purpose the maintenance of prices its farmers to [those established] above in subsection of this section." 1 7 U.S.C. § 602(2) The "policy (1982). Congress" of also di- rected that Secretary use the "the [commodity market ordering] powers conferred .. . chapter ... as under this in interests of producers provide, the will and consumers, an of the orderly [of flow supply commodity-here, milk]. . . to the avoid unreasonable fluctu- in ations and prices." Id. § 602(4). supplies 7 U.S.C. 608c(15)(B). § Community Nutrition, at U.S. (citing Barlow v. 467 347 Collins, U.S. 159, 168, 169 397 n.2, 175 & n.9 (1970) (opinion of Brennan, J.); Switchmen v. National Bd., Mediation 320 U.S. 300-01 (1943); 297, (most of all) and v. Morris Gressette, 432 491 U.S. The (1977)). Court that "when a statute noted contains a detailed mechanism for judicial consideration of particular at behest issues the particular persons, of review judicial of those issues at the behest other persons of [is] implicitly precluded." Id. at 349. I'l Id. at 348-52. HeinOnline -- 74 Va. L. Rev. 331 1988

59 332 Virginia [Vol. 74:275 Law Review prices. ble . . Handlers therefore can expected be challenge to unlawful agency action to and that ensure the statute's objectives ' not will frustrated." be Supreme The Court's is decision and logical competently rea- soned, but hardly the inevitable one, given the strong presumption reviewability of the and repeatedly Act's purpose stated "[t]o pro- '159 tect interest the the of consumer. Moreover, Court the once had expanded before upon the "detailed mechanism" for review in the Act, permit to producers (who, like consumers, not are provided a right to seek review the of Secretary's orders) seek to review of deductions made by Secretary the from "producer a settlement 160 fund" established in connection with marketing orders. The Court's justification for reaching a different in result Community Nutrition was that handlers had incentive no to seek review of de- ductions from a producers' fund (hence producers' a was suit the only real remedy), but handlers have do an incentive to seek low prices milk (and serve thus as acceptable surrogates for 1 consumers)." This excellent is an example how public of choice theory would help the Court ask the right questions. The equation drawn the by between Court handlers' the the and consumers' interests was 2 6 taken straight the from government's brief; consumers' the brief did not significantly challenge this point. in Yet the reality equa- tion is questionable. The reconstituted rule milk in Community Nutrition was effect in for almost decades two without being chal- lenged handlers-even by though it very clearly created monopoly price One abuses. wonders why, public and choice offers theory a plausible answer. The marketing orders penalizing of sales cheap reconstituted are milk to protect efforts monopoly local prices charged by producers. If cheap "powdered milk" could be shipped the from cheaper-price Midwest higher-price to markets, would it force producers cut to prices. their Why don't handlers object to monopoly these prices? Economic suggests theory that they may Id. at (citation 352 omitted). See 7 U.S.C. § 602(2) (1982) supra (quoted note 154); id. 602(4). § Stark v. See Wickard, U.S. 321 288, (1944). 308-10 Community 161 Nutrition, U.S. 467 at 351-53. "[TIhe 162 interests consumers of entirely are derivative the of interests of handlers and in protected be can handler-initiated proceedings." review Petitioners Brief for the [Govern- ment] at 13, Community Nutrition; id. see 29-30, at 31. HeinOnline -- 74 Va. L. Rev. 332 1988

60 19881 Statutory Interpretation bought off be producers, by cede who them their of a share monop- 1 6 profits oly . bill, The consumers the foot yet Nutri- Community that tion holds the they are only ones who cannot sue for review of the Secretary's orders! result The in Community been should Nutrition have permit to review judicial of consumers. the at behest functional The purpose of such review be would up open to a scheme statutory that has become petrified and increasingly rent-seeking over time. Perhaps the 1930's in the milk scheme of statutory a minima price served useful purpose (to dairy industry save the assure steady sup- and a milk), but ply of statutory scheme the over time has become rent- seeking, costing country an the estimated per million to $60 $100 1 6 4 year. This the is natural evolution of regulatory a scheme with asymmetrical costs and benefits: concentrated the beneficiaries have (dairy farmers) with alliances regulators built the De- in the partment of Agriculture (itself a notoriously captured agency any- way) and off the main concentrated have bought of cost group pay- handlers). is (the This ers "capture" scenario. the classic a such In situation, the Court seek to open up the should process regulatory wherever possible. judicial Affording review diffuse to the pay- cost ers (milk consumers) be a useful would procedural reform by which perhaps check-and to rent-seeking. reverse-the Easterbrook Judge endorsed has the Nutri- result Community in he though tion, even the rent-seeking is critical of it arrangement perpetuates. "Perhaps the devil's bargain the was that producers agreed accept to the mild supervision the by Secretary rather than supervision effective in exchange courts by the some for permitting ' additional run of competition in the doubt any- I things." that one, years fifty after enactment, could identify precise the "bar- gain" the found in statute. In event, why any should care? we The justification public for the review judicial procedures in the Act "establish was to equitable expeditious an and test- for procedure ' 6 of [milk the ing validity marketing] orders." The assumption of justification has always that as been, Community Nutrition explic- See 'e' Easterbrook, Foreword, supra note 49-51. 6, at 49 n.114. Id. at Id. at 50. 'e S. No. 1011, 74th Cong., 1st Sess. Rep. (1935), in Brief for the quoted 14 Petitioners [Government] 20, Community at Nutrition. HeinOnline -- 74 Va. L. Rev. 333 1988

61 Virginia 334 Law Review 74:275 [Vol. itly stated, that would handlers effective be surrogates for pub- the lic. are, They longer however, no (and perhaps never were) effec- tive surrogates, because their coincide to tend interests with those of producers. The interest groups the supporting Act its and regu- apparatus latory should held to be agreement their to afford an "equitable" procedure for challenging the orders. Allowing con- suits sumer would therefore be best the to open way up the inter- est group closure perpetuated last over the fifty Moreover, years. it be also would best way effectuate the the to balanced system that Congress originally envisioned. C. Affirmative The Case Action Consider, finally, the Court's Supreme decision Johnson in v. 67 Transportation Agency, Santa County, Clara California, de- scribed above. decision The interpreted 703(a) of the section Civil Rights Act of 1964, which prohibits "discriminat[ion] against any with individual respect to his compensation, terms, conditions, or privileges of employment, because such of race, individual's color, 6 5 religion, sex, national or origin."' issue was The section whether protects 703(a) white males deprived who are employment of op- portunities of because voluntary affirmative action plans that favor female applicants. had Court The earlier approved plans of favor- 6 9 black ing applicants in Weber.1 v. Steelworkers United The Court in Johnson not only reaffirmed and followed Weber, but ex- it panded affirmative to justify action plans whenever there are manifest racial or sexual imbalances traditionally within segre- 170 categories. job gated Justice O'Connor in concurred the judg- 7 ment, not in the but Three Weber.' of expansion ' Justices dis- the sented; dissenting main opinion was written by Justice Scalia. The Court's expansion Weber of seems questionable in light of its public choice consequences, Justice as argued Scalia some in 7 2 detail. On section face, its itself 703(a) a distributed is benefit, 107 S. 167 1442 (1987); see Ct. 302-03. supra pp. 2000e-2(a) (1982). 168 42 U.S.C. § (1979). 169 443 U.S. 193 170 107 S. Ct. at 1452-53. at 1461-62 Id. concurring (O'Connor, J., in the judgment). Id. 172 1471-76 at dissenting). (Scalia, J., have I In other examined articles, Weber and Johnson detail in greater here. See than I do Eskridge, supra note 10, 1488-96; at Eskridge, Overruling Statutory L.J. Precedents, 76 Geo. 1988). April (forthcoming HeinOnline -- 74 Va. L. Rev. 334 1988

62 19881 Statutory Interpretation distributed law, protects for cost it for who all a work covered en- and tity against sexual racial discrimination, and it applies most to employers, and joint labor-management unions, committees the in however, country. It can also, concentrated be analyzed as a cost law, target of group the because and companies, unions though nu- merous, is (like farmers) and relatively well-defined One cohesive. problem that these with is laws a to subject are they process of erosion as exceptions of them; are carved out cre- 703 section itself 7 " to appease labor ates of loopholes and manage- a number unions' 4 17 troubling is the tendency of cost ment. to displace Most bearers some of the costs onto others, or all some extent and to has this 5 17 VII. title under occurred Employers title fearing unions and liability because of their VII or even own of hard-to-explain con- past discrimination, because tinuing imbalances can effectively in workforces, their liabil- avoid (and potential backpay ity them) by awards against voluntarily adopting affirmative action plans plans. shift These much of the costs white male employees. onto "This situation is more to likely obtain," Justice the Court, Scalia reminded to "with respect the jobs-perversely skilled least an incentive creating to discriminate against members precisely those the nonfavored of groups least to have profited from societal discrimination in the past."' likely group, This though diffuse is numerous, unorga- and politically By nized. expanding statutory a upon exception hurts that that being unfair group, ways that Congress will not the Court is in the likely groups-civil rights orga- correct, because best-organized nizations, unions, employers-are and by the with de- large happy 7 7 the In cision. short, public eloquently perspective choice articu- 173 E.g., Civil Act 1964, § 703(h), 42 U.S.C. Rights of (1982) (exception § 2000e-2(h) for bona seniority see Firefighters arrangements); fide Local v. Stotts, Union No. 1784 U.S. 467 (1984) 561, 577 arrangement to upheld (seniority be court, a showing of discrim- a absent by behind the inatory intent arrangement). ,71 E.g., Civil Rights Act of 1964, 703(e)(1), § 42 U.S.C. 2000e-2(e)(1) § (1982) (defense for fide bona occupational qualifications). 175 Section 703(a) can also be analyzed as a concentrated benefit statute. Although all technically employees against race and sex discrimination, the effective pro- are protected tection concentrated groups-blacks is for Both women. are more likely and groups to or- politically (as indeed they have) and, consequently, might be prone to extract special ganize benefits for themselves over time. 1475 S. 178 at Johnson, (Scalia, J., dissenting). 107 Ct. The Johnson Court hardly responded to Justice Scalia's public choice concern. Com- 177 to id. 1450 n.7 (Congress' failure to react can, at some extent, be taken as an implicit pare HeinOnline -- 74 Va. L. Rev. 335 1988

63 336 Virginia Law Review 74:275 [Vol. that the Court's expansive lated Scalia by suggests Justice approach affirmative to action might be politically unfair. Should overruled? be Weber Not necessarily, because the public choice consequences counterbalanced are only not by stability- the of-law and reliance concerns decisis, of stare by but also concerns regarding evolution the statutory of policy. Section 703(a)'s prohi- bition of "discrimination" term not (a the in defined es- Act) has been sentially developed common a in law fashion by the Court, and that evolution the has taken beyond statute far the limits orig- inally imagined Congress. by assumption The 1964 in that was once color- and sex-blind hiring decisions were legally mandated, blacks, and women, minorities other would assume rightful their places the in workforce. But unanticipated problems, as such the continuing effects of past discrimination stereotypes, and have un- dercut that original assumption. The has Court responded in a pragmatic, common law fashion interpreting by 703(a) section to get at employment that practices exclude effectively certain groups and, possible, whenever to encourage voluntary redress of problems 1 7 8 by employers unions and themselves. Indeed, in both Weber and Johnson, facts the indicated that blacks women and might well have continued be to had excluded there not been affirmative an plan action in place. least At now, for voluntary action affirmative plans probably are necessary make to statutory the scheme "work." Hence, Justice Scalia's public choice arguments, though are valid, perspective just one that must one bring bear to when interpreting the statute. Given competing these concerns, should how 703(a) section have been be) interpreted? (or Justice O'Connor's concurring opinion is the that opinion only openly considered both concerns. She sug- that gested statute the permits voluntary affirmative "only action remedial a as device to actual eliminate or apparent discrimination 17 ' 9 or the lingering effects of this discrimination. opinion Her was approval Court's the of decision) with at id. (Scalia, 1472-73 dissenting) J., (simple inertia well explain may Congress' inaction). 178 Alexander See, e.g., v. Gardner-Denver 36, U.S. 415 Co., (1974) (Congress 44 favored voluntary compliance); v. Griggs Duke Power Co., 401 U.S. (1971) 424 test in (employment applicants). black most effect barred Johnson, 179 107 at S. Ct. 1461 (O'Connor, J., concurring the judgment). in According to Justice O'Connor, "the employer had must have firm basis for a believing that remedial action was required. An employer would have such a it can firm basis if statistical a to point HeinOnline -- 74 Va. L. Rev. 336 1988

64 Statutory Interpretation 19881 attempt sensitive something from each perspective, and to a take to hence a limited approve affirmative of use action. best The les- public of son theory choice is that here the temporary nature of such voluntary plans is the critical: scheme statutory some requires affirmative action, but the Court should be mindful ef- such that should forts not give employers and unions permanent a and un- restricted carte to blanche costs shift to the lower-level, nonfa- vored employees typically hurt by these efforts at affirmative action. CONCLUSION In this unfortunately decade, the neglected field of statutory in- terpretation enjoyed has something of an intellectual renaissance. Exploration of field has the been enriched by insights from other disciplines, particularly by models of the political process. There is, at this uncontroversial no point, model political the of process, though it settled is but all the that political optimistic assumptions of the 1950's were each wrong. Still, leading the of political process models has something constructive to offer legal theory statu- of tory interpretation. two After of decades empirical theoretical and development, public theory choice have may the most to offer, de- spite limitations. its Its implications statutory for interpretation likely will occupy scholars next for the decade. Where will inquiry this As lead? I have suggested Article, this in not think I do public choice theory will rigorously any of support the traditional foundationalist approaches statutory to interpreta- (based tion original on intent, text, and original purpose). Rather than teaching statutory that us interpretation puzzle is a that can be determinatively resolved, public theory choice teach will us that statutory interpretation is more complicated we once than thought it, for the inquiries suggested by public choice theory are compli- cating rather than simplifying. instance, For do courts in fact have comparative institutional advantages that permit them to trans- or update form statutes through interpretation? If which so, stat- disparity sufficient to support a prima facie claim under Title by the employee VII benefi- ciaries the affirmative of action plan of pattern or practice a of discrimination." claim Id. HeinOnline -- 74 Va. L. Rev. 337 1988

65 338 Virginia Law Review [Vol. 74:275 utes should be transformed, and which left alone? Can courts de- velop strategies that encourage Congress and agencies to reduce the incidence of rent-seeking in public law? The most exciting element of public the choice influence stat- on utory interpretation will be its emphasis the on dynamics of statu- tory law-a concept that courts must recognize in this age of stat- utes. As statutory law has become profoundly complex and important, we can no longer afford to interpret statutes static, as unrelated incidents. statute A must be interpreted with an eye to what it is becoming, not what it was originally. As important an insight on the evolution of statutes, and especially on the dysfunc- tions in that evolution, public choice theory will become an in- creasingly useful tool of statutory analysis. HeinOnline -- 74 Va. L. Rev. 338 1988

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