Facing the Limits of the Administrative State

A non political professional administrative state was the most lasting legacy of the progressives in the first progressive era, but it was based on two assumptions that proved false and one constitutional issue that the courts are adjusting to.

The first assumption was that there is a general will as opposed to political interests, and that the administration of government was beyond debate and this could be handled by professional NON Partisan administrators. The second assumption was that the administrators would be competent enough to design and overrule market systems and mechanisms.  The administrative state has clearly become politicized especially with the allowance of public sector unions under Kennedy.

The knowledge deficit has become worse.  Economics and sociology has studied the inability of any select group to possibly understand the decision matrices of a modern market.  Experts can know more than any of us, but not more than all of us.  Decision biases affect the brightest around us.  The Best and the Brightest by David Halberstam was the story of the disasters visited on us by some of our most credentialed leaders and advisors.

“The curious task of economics is to demonstrate to men how little they really know about what they imagine they can design”. Friedrich August von Hayek

The constitutional question is the more serious one. The Founders were conservative in the sense that they took man as he was with all of his virtues and weaknesses and understood the seduction of power.  This is why they divided power and why Madison observed that the epitome of tyranny is the combination of the executive, legislative and judicial functions in a single branch.  That is essentially the state of our current administrative state and explains how my experience with the EPA became possible.  Challenges to the legislative acts of the administrative state will be the most serious challenge to be handled  by SCOTUS.  It is coming.

The other danger of delegating the details of legislation it that it removes Congress from accountability and makes for sloppy legislation.  Legislators are allowed to govern by theory, proposing an idea and then delegating the details to an agency charged to “make” it work.  Similarly they have made SCOTUS political depending on an activist court to press their legislative agenda, forgetting that it was an activist court that delivered the Dred Scott decision.  How comfortable will we be with an activist court loaded with Trump nominees?

This leads to a rethinking of the Administrative State in line with lessons learned and new thinking on how such organizations function.  Regulators are OK for executing clear laws, but terrible at designing systems and regulations  to advance unproven political theories.



Pal Review

from Steve Milloy at the WSJ, A Step Toward Scientific Integrity at the EPA:

The most prominent of the EPA’s myriad boards of outside advisers are the Science Advisory Board and the Clean Air Scientific Advisory Committee, or CASAC. Mostly made up of university professors, these boards also frequently draw members from consulting firms and activist groups. Only rarely do members have backgrounds in industry. All EPA boards are governed by the Federal Advisory Committee Act, which requires that they be balanced and unbiased. While the EPA is required by law to convene the SAB and CASAC, the agency is not bound by law to heed their advice.

In 1996 two-thirds of the CASAC panel had no financial connection to the EPA. By the mid-2000s, the agency had entirely flipped the composition of the advisory board so two-thirds of its members were agency grantees. Lo and behold, CASAC suddenly agreed with the EPA’s leadership that fine particulates in outdoor air kill. During the Obama years, the EPA packed the CASAC panel. Twenty-four of its 26 members are now agency grantees, with some listed as principal investigators on EPA research grants worth more than $220 million.

HKO

This is the consequence of political consensus ruling over scientific inquiry. Scientific objectivity is thwarted by intellectual McCarthyism. Dissent is demonized, careers are destroyed.  It is more like religious fanaticism than science.  Yet they have been able to brand the right with the pejorative of being anti-science.  Moral superiority justifies illiberalism. Obvious conflicts of interests are ignored.

Read the whole article.



Biogenic Carbon

Old MacDonald Had a . . . Climate Offender, from Bruce Dale at The Wall Street Journal

A basic fact about agricultural products such as grains and oilseeds is that the carbon in them, called biogenic carbon, came from the atmosphere. Biogenic carbon will return to the atmosphere when these products are consumed, such as when human beings eat bread and then breathe out the carbon dioxide resulting from the breakdown of bread in the body. Biogenic carbon therefore cannot contribute to climate change.

Why is the Environmental Protection Agency denying this basic fact of climate science? The EPA is counting biogenic-carbon emissions as if they were the same as fossil-carbon emissions. They are not the same. Carbon atoms emitted by burning fossil fuels are, in effect, on a one-way trip from the ground to the atmosphere, where they will stay for hundreds of millions of years. In contrast, carbon atoms taken from the atmosphere to make agricultural products are on a round trip from the atmosphere to farms then back to the atmosphere.

The EPA intends to penalize American farmers and those who make modern energy and bioproducts such as plastics from agricultural feedstocks by treating biogenic carbon like fossil carbon. As part of its approach, the EPA is now attempting to regulate “sustainability” in the farm field.

The EPA is trying to put itself in charge of regulating farms—an outstanding example of “mission creep” and bureaucratic overreach. Regulating agriculture is not the EPA’s job—we already have an Agriculture Department. The EPA’s approach would demand proof of exactly which farm produced every pound of corn, wheat, soy or cottonseed used by customers of those farms—a practical impossibility in the U.S. agricultural system.

HKO

Should we be surprised that a bureaucracy who sees their mission to save the world have a problem with understanding any limit on their mission or power.



The Dangers of Comprehensive Reform

In 1991 our company received a letter from the EPA that we were a ‘PRP’ which stands for a ‘Potentially Responsible Party’ for an environmental cleanup near Tampa, Florida. In 1980 Congress passed the act which created the Superfund, which was a pool of funds administered by a new bureaucracy.

This new bureaucracy decided that since we had sold lead batteries to a lead recycling firm that, according to the new law, we were therefore responsible for their downstream liability.  The recycler disposed of the lead acid improperly, causing water pollution in a nearby swamp.

But we sold the batteries two years before the law was enacted. Didn’t matter; we were held retroactively liable.  We could not explain our innocence to a jury because there was no jury; just a ruling from the Department of Justice.  We were directed to participate in the cleanup or face fines of $25,000 per day.  My daughter then a new born would be held liable as a descendent of a targeted business.

We were one of thousands of scrap yards that sent batteries to the site; but one of a few dozen that were actually viable enough to fund a cleanup. We were held jointly and severally liable for the cleanup, so if one of the other PRPs went bankrupt we had to cover their share.

When we found out that an environmental remediation company had damaged the site prior to our involvement we sought to sue them for their liability only to find out that they had worked for the EPA and were indemnified for their negligence and incompetence. This meant that even if we proved their negligence in court that the cost of their action would be charged back to US as an ongoing site expense.

Over the next 15 years our ‘cleanup group’ spent more on legal bills than we spend on the cleanup. An entire industry of environmental lawyers grew to respond to the Kafkaesque world created by the EPA and Superfund.  As one of the other PRPs noted, ” Our grandparents left countries because of laws like this.”

When the Superfund bill was passed it enjoyed widespread support from both parties to address the very real concern over the funding to clean up about 1400 identified sites.  But like other such ‘comprehensive’ laws the details are rarely identified in the bill itself.  The details are written and enforced by a bureaucracy that writes rules that our elected representatives never see, that are never debated at town hall meetings, that are never joked about by John Stewart or Bill Maher, that never hear the scorn from Bill O’Reily or Glenn Beck or Rush Limbaugh, and are too complicated to be addressed by the great unwashed sending in their letter to the editors.

This is why the details and hot points about the still to be seen Health Care Bill are irrelevant and distracting.  Once the government is able to establish a bureaucracy to write the rules and govern the use of our health care system the real damage will be beyond the scope of the Tea Parties, Twitterers, and even our own legislators.  This is the real truth about how the laws work in this country, especially when we seek ‘comprehensive ‘reform.   “Comprehensive reforms” create bureaucracies that are unaccountable and indestructible.  They relegate our basic systems of justice to the dustbins of history.

Instead of trying to recreate an entire system we should identify the broken parts and fix them, one at a time if necessary. It would be much easier to get a bipartisan agreement and actually get something passed.  We agree that there are parts of the system that need change, but in our rush to ‘do something’ we attempt to do everything and end up with nothing.

But amidst the arguments and controversies this bill will be compromised at any cost as long as the end result is the establishment of a government bureaucracy to control our health care system. That is when the real damage will be done.