YALE LAW LIBRARY SERIES IN LEGAL HISTORY AND REFERENCE This page intentionally left blank jerry l. mashaw C reating the Administrative C onstitution the lost one hundred years of american administrative law new haven and london Published with support from the Lillian Goldman Law Library, Yale Law School. Copyright © 2012 by Jerry L. Mashaw. All rights reserved. This book may not be reproduced, in w hole or in part, including illustrations, in any form (beyond that copying permitted by Sections 107 and 108 of the U.S. Copyright Law and except by reviewers for the public press), without written per- mission from the publishers. Yale University Press books may be purchased in quantity for educational, busi- ness, or promotional use. For information, please e-mail [email protected] (U.S. offi ce) or [email protected] (U.K. offi ce). Set in Scala and Scala Sans by Westchester Book Group Printed in the United States of America Library of Congress Cataloging- in- Publication Data Mashaw, Jerry L. Creating the administrative constitution : the lost one hundred years of American administrative law / Jerry L. Mashaw. p. cm. — (Yale law library series in legal history and reference) Includes bibliographical references and index. ISBN 978- 0- 300- 17230- 0 (hardback) — ISBN 978- 0- 300- 18002- 2 (pbk.) 1. Administrative law— United States— History. 2. Administrative procedure— United States—H istory. I. Title. KF5402.M37 2012 342.73'06—dc23 2011042673 A cata logue record for this book is available from the British Library. This paper meets the requirements of ANSI/NISO Z39.48- 1992 (Permanence of Paper). 10 9 8 7 6 5 4 3 2 1 CONTENTS Preface and Acknowledgments vii Introduction 1 Recovering American Administrative Law 3 PART I Federalist Foundations, 1787– 1801 2 Pragmatic State- Building 29 3 “To see that the laws are faithfully executed”: Managerial and Hierarchical Control in the Early Republic 53 4 Legal Accountability: The Common Law Model 65 PART II Reluctant Nationalists, 1801– 1829 5 Federalist State- Building Meets Republican Small- State Ideology 81 6 Administering the Embargo: An Exercise in Regulatory Hubris 91 7 Bureaucratizing Land 119 vi contents PART III Administration and “The Democracy,” 1829– 1861 8 Democracy and Administration 147 9 The Bank War and Sub- Treasury System 156 10 Democracy, Offi ce, and the Reform of Administrative Or ga ni za tion 175 11 Regulating Steamboats 187 12 The Administrative Constitution of “The Democracy” 209 PART IV Administrative Government in the Gilded Age 13 Nation, State, and Administration in the Gilded Age 227 14 Mass Administrative Adjudication: Case Studies in the Development of Internal Administrative Law 251 PART V Rethinking the Administrative Constitution 15 The Administrative Constitution: Then and Now 285 Notes 317 Index 415 PREFACE AND ACKNOWLEDGMENTS This book, like many such projects, began as something entirely diff erent. During the winter and spring of 2003 my wife and I were in residence, fi rst at Victoria University in Wellington, New Zealand, and then for a substan- tially longer period at the Research School for Social Sciences at the Austra- lian National University in Canberra. During our time in the Antipodes I was invited to give lectures in Wellington, Auckland, Melbourne, Sydney, and Canberra. In the usual fashion of traveling academics I presumed little or no overlap in the attendees at these widely separated venues and off ered up the same lecture for each audience. The working title of the lecture was “Prometheus Bound: The Building and Binding of the American Administrative State.” As one audience mem- ber gently chided me, it was a “rough ride over uneven ground,” a sixty- minute excursion over two hundred years of American public administration and administrative law. Following conventional historiography, my lecture gave nineteenth- century federal administration and administrative law de- velopments about ten minutes and spent the remainder of the hour on the twentieth and very early twenty- fi rst centuries. At the inevitable post- lecture dinners more than one participant— whether from an excess of hospitality or Australian or New Zealand wine I know not— suggested that this over- view of American institutional and legal developments would make a use- ful short book. Nothing of the kind existed, and the potential audience was both foreigners interested in American legal and po litic al development and American students of law, politics, and public administration. While on leave Down Under I was working on other projects, but returned to the short- book idea when we were resettled in New Haven. Because I felt viii preface and acknowledgments I knew the twentieth- century developments fairly well, I decided to begin at the beginning, and, from some perverse instinct, pulled out the fi rst vol- ume of the U.S. Statutes at Large. The experience was something like Alice dropping down the rabbit hole, or perhaps the Narnia kids going through the back of the wardrobe. According to the secondary literature that I knew, the topography of American administrative institutions should have resem- bled a largely open and unpopulated plain, dotted here and there with an Executive Department that attended mostly to house keeping or infrastruc- ture matters. Beyond customs collection and the delivery of the mail, my existing mental map revealed little national administrative activity. I quickly realized that my map was defective. Volume one of the Statutes at Large re- vealed unexpected national initiatives, including multiple regulatory schemes, and not a few benefi ts programs. Moreover, these initiatives were some- times administered through extra- departmental boards and commissions that issued rules and adjudicated cases pursuant to broad delegations of statutory authority. This was not going to be a quick romp through a nine- teenth century populated largely by self- executing laws enforced in court, and therefore of modest interest to a student of administration and admin- istrative law. Eight years later a short book on two centuries of American administra- tive institutions and administrative law had become a not- so- short book devoted to the national government’s fi rst one hundred years. What I had imagined as a concise exposition of a relatively conventional story of Ameri- can institutional and legal development became a decidedly contrarian es- say, for this book describes how much was built in those fi rst one hundred years rather than how little national administrative institutions mattered in the early Republic’s governance. As with any contrarian case, I emphasize in these pages aspects of Amer- ican institutional and legal development that others have largely ignored. The congresses, presidents, and federal administrative offi cials who popu- lated the fi rst century of American governance fi lled a yawning gap in the Constitution of 1787. They created an administrative constitution, much of it enduring. Understanding the contours of that constitution is important to understanding American po liti cal development and, as the following pages will suggest, to analyzing contemporary normative claims concerning the structure and legitimacy of American administrative institutions. I must hasten to add that my contrarian story hardly displaces much of conventional historiography concerning the dramatic rise of the American administrative state in the twentieth century. Nevertheless, I argue, indeed I believe I demonstrate, that some of that conventional understanding is preface and acknowledgments ix wrong. And, because it is wrong, normative legal arguments built on these conventional originalist foundations are unpersuasive. To return to the topo- graphic meta phor, the national administrative space was much more densely settled and complexly developed than we have heretofore been led to believe. Staring at that map hardly permits us to fully anticipate the urban/suburban sprawl of the national administrative institutions of the twentieth century. Instead this revised cartography permits a better understanding of which of those developments were truly novel and which simply built on the institu- tions and legal understandings that emerged in what I now think of as the “Lost One Hundred Years of American Administrative Law.” An author engaged in a project of this length and scope incurs many debts— debts that can only be acknowledged, not repaid. Indeed, I fear that from myopia or simple forgetfulness I will fail even to acknowledge many who have contributed to this project both directly and indirectly. But names must be named. I owe a major debt, of course, to my home institution. The Yale Law School’s support for scholarship is the stuff of fables. I have often described life as a Yale Law School faculty member as the modern equivalent of living at the Court of the Medici, but without the obligations of a courtier. Many of my colleagues have commented on earlier drafts and on articles that have been integrated into the current text. I must give special thanks to Bruce Ackerman and Akhil Amar who have read every page and commented on most of them. That their comments seldom overlapped has simply made them all the more useful. I benefi ted enormously from a one-d ay conference at Albany Law School or ga nized by Professor Timothy Lytton. Tim assembled a remarkable group of interdisciplinary scholars from all over the country. That group included Ray Brescia, Daniel Carpenter, Daniel Ernst, Lawrence Friedman, Robert Gordon, Robert Kagan, Richard Merrill, William Novak, Nicholas Parrillo, Robert Raban, Peter Schuck, Jed Shugerman, Peter Strauss, Stephen Sugar- man, and Richard Stewart. Each of the attendees read the whole of an ear- lier version of the manuscript and spent a day and an eve ning peppering me with their questions and comments. It was an exhilarating and su- premely useful extended seminar. My thanks to all who participated (some of whom I fear I have omitted) and particularly to Tim, who or ga nized the conference, and to the Albany and Yale Law Schools that supported it. In addition I have had the benefi t of faculty seminars, not only at Yale, but at Boston University, the University of Arizona, Harvard, Williamette, Cardoza, Michigan State University, the University of Pennsylvania, and the University of California at Berkeley. The participants in these workshops